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TABLE OF CONTENTS
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
PART C Other information

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As filed with the Securities and Exchange Commission on May 22, 2019

Registration No. 333-230351


U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549


FORM N-2

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

ý PRE-EFFECTIVE AMENDMENT NO. 1

o POST-EFFECTIVE AMENDMENT NO.

ARES CAPITAL CORPORATION
(Exact Name of Registrant as Specified in Charter)

245 Park Avenue, 44 th  Floor
New York, New York 10167
(Address of Principal Executive Offices)

Registrant's Telephone Number, including Area Code: (212) 750-7300

Joshua M. Bloomstein
General Counsel
Ares Capital Corporation
245 Park Avenue, 44 th  Floor
New York, New York 10167
(212) 750-7300
(Name and Address of Agent for Service)

Copies of information to:

Monica J. Shilling
Christopher J. Wu
Kirkland & Ellis LLP
333 South Hope Street, 29th Floor
Los Angeles, California 90071
(310) 552-4200

Approximate Date of Proposed Public Offering:
From time to time after the effective date of this Registration Statement.

                     If any securities being registered on this form will be offered on a delayed or continuous basis in reliance on Rule 415 under the Securities Act of 1933, other than securities offered in connection with a dividend reinvestment plan, check the following box.     ý

                     It is proposed that this filing will become effective (check appropriate box):

                      o when declared effective pursuant to section 8(c).

CALCULATION OF REGISTRATION FEE UNDER THE SECURITIES ACT OF 1933

               
 
Title of Securities Being
Registered

  Amount Being
Registered

  Proposed Maximum
Offering Price
Per Unit

  Proposed Maximum
Aggregate Offering
Price(1)

  Amount of
Registration Fee

 

Common Stock, $0.001 par value per share(2)(3)

               
 

Preferred Stock, $0.001 par value per share(2)

               
 

Subscription Rights(2)

               
 

Warrants(4)

               
 

Debt Securities(5)

               
 

Units(6)

               
 

Total

          $3,000,000,000(7)   $363,600(8)

 

(1)
Estimated pursuant to Rule 457(o) solely for the purpose of determining the registration fee. The proposed maximum offering price per security will be determined from time to time, by the Registrant in connection with the sale by the Registrant of the securities registered under this registration statement.

(2)
Subject to Note 7 below, there is being registered hereunder an indeterminate number of shares of common stock or preferred stock, or subscription rights to purchase shares of common stock as may be sold, from time to time separately or as units in combination with other securities registered hereunder.

(3)
Includes such indeterminate number of shares of common stock as may, from time to time, be issued upon conversion or exchange of other securities registered hereunder, to the extent any such securities are, by their terms, convertible or exchangeable for common stock.

(4)
Subject to Note 7 below, there is being registered hereunder an indeterminate number of warrants as may be sold, from time to time separately or as units in combination with other securities registered hereunder, representing rights to purchase common stock, preferred stock or debt securities.

(5)
Subject to Note 7 below, there is being registered hereunder an indeterminate principal amount of debt securities as may be sold, from time to time separately or as units in combination with other securities registered hereunder. If any debt securities are issued at an original issue discount, then the offering price shall be in such greater principal amount as shall result in an aggregate price to investors not to exceed $3,000,000,000.

(6)
Subject to Note 7 below, there is being registered hereunder an indeterminate number of units. Each unit may consist of a combination of any one or more of the securities being registered hereunder and may also include securities issued by third parties, including the U.S. Treasury.

(7)
In no event will the aggregate offering price of all securities issued from time to time pursuant to this registration statement exceed $3,000,000,000.

(8)
Previously paid.

                      THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY DETERMINE.

   


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The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

Subject to Completion, dated May 22, 2019

PROSPECTUS

$3,000,000,000

LOGO

Common Stock
Preferred Stock
Debt Securities
Subscription Rights
Warrants
Units


               Ares Capital Corporation is a specialty finance company that is a closed-end, non-diversified management investment company incorporated in Maryland. We have elected to be regulated as a business development company under the Investment Company Act of 1940. Our investment objective is to generate both current income and capital appreciation through debt and equity investments. We invest primarily in first lien senior secured loans (including "unitranche" loans, which are loans that combine both senior and mezzanine debt, generally in a first lien position), second lien senior secured loans and mezzanine debt, which in some cases includes an equity component. To a lesser extent, we also make preferred and/or common equity investments.

               We are externally managed by our investment adviser, Ares Capital Management LLC, a subsidiary of Ares Management Corporation, a publicly traded, leading global asset manager. Ares Operations LLC, a subsidiary of Ares Management Corporation, provides certain administrative and other services necessary for us to operate.

               Our common stock is traded on The NASDAQ Global Select Market under the symbol "ARCC." On May 21, 2019 the last reported sales price of our common stock on The NASDAQ Global Select Market was $17.96 per share. The net asset value per share of our common stock at March 31, 2019 (the last date prior to the date of this prospectus on which we determined net asset value) was $17.21.

                Investing in our securities involves risks that are described in the "Risk Factors" section beginning on page 23 of this prospectus, including the risk of leverage.

                We may offer, from time to time, in one or more offerings or series, up to $3,000,000,000 of our common stock, preferred stock, debt securities, subscription rights to purchase shares of our common stock, warrants representing rights to purchase shares of our common stock, preferred stock or debt securities, or units comprised of any combination of the foregoing, which we refer to, collectively, as the "securities." The preferred stock, debt securities, subscription rights and warrants (including as part of a unit) offered hereby may be convertible or exchangeable into shares of our common stock. The securities may be offered at prices and on terms to be described in one or more supplements to this prospectus. In the event we offer common stock, the offering price per share of our common stock less any underwriting commissions or discounts will generally not be less than the net asset value per share of our common stock at the time we make the offering. However, we may issue shares of our common stock pursuant to this prospectus at a price per share that is less than our net asset value per share (a) in connection with a rights offering to our existing stockholders, (b) with the prior approval of the majority of our common stockholders or (c) under such circumstances as the SEC may permit. This prospectus describes some of the general terms that may apply to an offering of our securities. We will provide the specific terms of these offerings and securities in one or more supplements to this prospectus. We may also authorize one or more free writing prospectuses to be provided to you in connection with these offerings. The accompanying prospectus supplement and any related free writing prospectus may also add, update, or change information contained in this prospectus. You should carefully read this prospectus, the accompanying prospectus supplement, any related free writing prospectus and the documents incorporated by reference herein, before investing in our securities. We file annual, quarterly and current reports, proxy statements and other information with the SEC. This information is available free of charge by calling us collect at (310) 201-4200 or on our website at www.arescapitalcorp.com . The SEC also maintains a website at www.sec.gov that contains such information.


                Neither the SEC nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

                This prospectus may not be used to consummate sales of securities unless accompanied by a prospectus supplement.


The date of this prospectus is                            , 2019.


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              You should rely only on the information contained in this prospectus, the accompanying prospectus supplement, any related free writing prospectus, the documents incorporated by reference in this prospectus and the applicable prospectus supplement, or any other information to which we have referred you. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in, or incorporated by reference in, this prospectus, the accompanying prospectus supplement or any such free writing prospectus is, or will be, accurate only as of the dates on their respective covers. Our business, financial condition, results of operations and prospects may have changed since any such date.


TABLE OF CONTENTS

 
  Page

Prospectus Summary

  1

The Company

  1

Offerings

  11

Fees and Expenses

  14

Selected Condensed Consolidated Financial Data of Ares Capital

  19

Risk Factors

  23

Forward-Looking Statements

  54

Use of Proceeds

  56

Price Range of Common Stock and Distributions

  58

Management's Discussion and Analysis of Financial Condition and Results of Operations

  60

Senior Securities

  98

Business

  102

Portfolio Companies

  119

Management

  152

Certain Relationships and Related Transactions

  184

Control Persons and Principal Stockholders

  186

Determination of Net Asset Value

  188

Dividend Reinvestment Plan

  190

Certain Material U.S. Federal Income Tax Considerations

  192

Description of Securities

  202

Description of Our Capital Stock

  203

Description of Our Preferred Stock

  211

Description of Our Subscription Rights

  212

Description of Our Warrants

  214

Description of Our Debt Securities

  216

Description of Our Units

  229

Sales of Common Stock Below Net Asset Value

  230

Issuance of Warrants or Securities to Subscribe For or Convertible Into Shares of Our Common Stock

  236

Regulation

  237

Custodian, Transfer and Dividend Paying Agent and Registrar

  244

Brokerage Allocation and Other Practices

  245

Plan of Distribution

  246

Legal Matters

  248

Independent Registered Public Accounting Firm

  249

Available Information

  250

Incorporation of Certain Information By Reference

  251

Financial Statements

  F-1

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ABOUT THIS PROSPECTUS

              This prospectus is part of a registration statement that we have filed with the U.S. Securities and Exchange Commission (the "SEC"), using the "shelf" registration process. Under the shelf registration process, we may offer, from time to time, in one or more offerings or series, up to $3,000,000,000 of our common stock, preferred stock, debt securities, subscription rights to purchase shares of our common stock, warrants representing rights to purchase shares of our common stock, preferred stock or debt securities, or units comprised of any combination of the foregoing, on terms to be determined at the time of the offering. The securities may be offered at prices and on terms described in one or more supplements to this prospectus. This prospectus provides you with a general description of the securities that we may offer. Each time we use this prospectus to offer securities, we will provide a prospectus supplement that will contain specific information about the terms of that offering. We may also authorize one or more free writing prospectuses to be provided to you that may contain material information relating to these offerings. Such prospectus supplement and/or free writing prospectus (collectively referred to hereinafter as the "prospectus supplement") may also add, update or change information contained in this prospectus or in the documents we incorporate by reference herein. This prospectus and the prospectus supplement, together with any documents incorporated by reference herein, will include all material information relating to the applicable offering. Please carefully read this prospectus and the prospectus supplement, together with any documents incorporated by reference in this prospectus and the applicable prospectus supplement, any exhibits and the additional information described under the headings "Available Information," "Incorporation of Certain Information By Reference," "Prospectus Summary" and "Risk Factors" before you make an investment decision.

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PROSPECTUS SUMMARY

               This summary highlights some of the information contained elsewhere in this prospectus. It is not complete and may not contain all of the information that you may want to consider. You should read carefully the more detailed information set forth under "Risk Factors" and the other information included in this prospectus and the accompanying prospectus supplement. Except where the context suggests otherwise, the terms "we," "us," "our," "the Company" and "Ares Capital" refer to Ares Capital Corporation and its consolidated subsidiaries; "Ares Capital Management" and "our investment adviser" refer to Ares Capital Management LLC; "Ares Operations" and "our administrator" refer to Ares Operations LLC; and "Ares" and "Ares Management" refer to Ares Management Corporation (NYSE: ARES) and its affiliated companies (other than portfolio companies of its affiliated funds).


THE COMPANY

Overview

              Ares Capital, a Maryland corporation, is a specialty finance company that is a closed-end, non-diversified management investment company. We have elected to be regulated as a business development company, or a "BDC," under the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder or the "Investment Company Act." We were founded on April 16, 2004, were initially funded on June 23, 2004 and completed our initial public offering ("IPO") on October 8, 2004. As of March 31, 2019, we were the largest BDC in the United States with approximately $14.0 billion of total assets.

              We are externally managed by our investment adviser, Ares Capital Management, a subsidiary of Ares Management, a publicly traded, leading global alternative asset manager, pursuant to our investment advisory and management agreement. Our administrator, Ares Operations, a subsidiary of Ares Management, provides certain administrative and other services necessary for us to operate.

              Our investment objective is to generate both current income and capital appreciation through debt and equity investments. We invest primarily in U.S. middle-market companies, where we believe the supply of primary capital is limited and the investment opportunities are most attractive. However, we may from time to time invest in larger or smaller companies. We generally use the term "middle-market" to refer to companies with annual EBITDA between $10 million and $250 million. As used herein, EBITDA represents net income before net interest expense, income tax expense, depreciation and amortization.

              We invest primarily in first lien senior secured loans (including "unitranche" loans, which are loans that combine both senior and mezzanine debt, generally in a first lien position), second lien senior secured loans and mezzanine debt, which in some cases includes an equity component. First and second lien senior secured loans generally are senior debt instruments that rank ahead of subordinated debt of a given portfolio company. Mezzanine debt is subordinated to senior loans and is generally unsecured. Our investments in corporate borrowers generally range between $30 million and $500 million each and investments in project finance/power generation projects generally range between $10 million and $200 million. However, the investment sizes may be more or less than these ranges and may vary based on, among other things, our capital availability, the composition of our portfolio and general micro-and macro-economic factors.

              To a lesser extent, we also make preferred and/or common equity investments, which have generally been non-control equity investments of less than $20 million (usually in conjunction with a concurrent debt investment). However, we may increase the size or change the nature of these investments.

              The proportion of these types of investments will change over time given our views on, among other things, the economic and credit environment in which we are operating. In pursuit of our

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investment objective we generally seek to self-originate investments and lead the investment process, which may result in us making commitments with respect to indebtedness or securities of a potential portfolio company in excess of our final investment. In such situations, while we may initially agree to fund up to a certain dollar amount of an investment, we may subsequently syndicate or sell a portion of such amount (including, without limitation, to vehicles managed by our portfolio company, Ivy Hill Asset Management, L.P. ("IHAM")), such that we are left with a smaller investment than what was reflected in our original commitment. In addition to originating investments, we may also acquire investments in the secondary market (including purchases of a portfolio of investments).

              The first and second lien senior secured loans in which we invest generally have stated terms of three to 10 years and the mezzanine debt investments in which we invest generally have stated terms of up to 10 years, but the expected average life of such first and second lien loans and mezzanine debt is generally between three and seven years. However, we may invest in loans and securities with any maturity or duration. The instruments in which we invest typically are not rated by any rating agency, but we believe that if such instruments were rated, they would be below investment grade (rated lower than "Baa3" by Moody's Investors Service, lower than "BBB–" by Fitch Ratings or lower than "BBB–" by Standard & Poor's Ratings Services), which, under the guidelines established by these entities, is an indication of having predominantly speculative characteristics with respect to the issuer's capacity to pay interest and repay principal. Bonds that are rated below investment grade are sometimes referred to as "high yield bonds" or "junk bonds." We may invest without limit in debt or other securities of any rating, as well as debt or other securities that have not been rated by any nationally recognized statistical rating organization.

              We believe that our investment adviser, Ares Capital Management, is able to leverage the current investment platform, resources and existing relationships of Ares Management with financial sponsors, financial institutions, hedge funds and other investment firms to provide us with attractive investment opportunities. In addition to deal flow, the Ares investment platform assists our investment adviser in analyzing, structuring and monitoring investments. Ares has been in existence for over 20 years and its partners have an average of approximately 24 years of experience in leveraged finance, private equity, distressed debt, commercial real estate finance, investment banking and capital markets. We have access to Ares' investment professionals and administrative professionals, who provide assistance in accounting, finance, legal, compliance, operations, information technology and investor relations. As of March 31, 2019, Ares had approximately 420 investment professionals and approximately 650 administrative professionals.

              While our primary focus is to generate current income and capital appreciation through investments in first and second lien senior secured loans and mezzanine debt and, to a lesser extent, equity securities of eligible portfolio companies, we also may invest up to 30% of our portfolio in non-qualifying assets, as permitted by the Investment Company Act. See "Regulation." Specifically, as part of this 30% basket, we may invest in entities that are not considered "eligible portfolio companies" (as defined in the Investment Company Act), including companies located outside of the United States, entities that are operating pursuant to certain exceptions under the Investment Company Act, and publicly traded entities whose public equity market capitalization exceeds the levels provided for under the Investment Company Act.

Senior Direct Lending Program

              We have established a joint venture with Varagon Capital Partners ("Varagon") to make certain first lien senior secured loans, including certain stretch senior and unitranche loans, primarily to U.S. middle-market companies. Varagon was formed in 2013 as a lending platform by American International Group, Inc. and other partners. The joint venture is called the Senior Direct Lending Program (the "SDLP"). The SDLP may generally commit and hold individual loans of up to $300 million. We may directly co-invest with the SDLP to accommodate larger transactions. The SDLP

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is capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of ours and Varagon (with approval from a representative of each required).

              We provide capital to the SDLP in the form of subordinated certificates (the "SDLP Certificates"), and Varagon and its clients provide capital to the SDLP in the form of senior notes, intermediate funding notes and the SDLP Certificates. As of March 31, 2019, we and a client of Varagon owned 87.5% and 12.5%, respectively, of the outstanding SDLP Certificates. The SDLP Certificates pay a coupon of the London Interbank Offered Rate ("LIBOR") plus a stated spread and also entitle the holders thereof to receive a portion of the excess cash flow from the loan portfolio, which may result in a return to the holders of the SDLP Certificates that is greater than the stated coupon. The SDLP Certificates are junior in right of payment to the senior notes and intermediate funding notes.

              As of March 31, 2019, we and Varagon and its clients had agreed to make capital available to the SDLP of $6.2 billion in the aggregate, of which $3.3 billion has been funded. As of March 31, 2019, we agreed to make available to the SDLP (subject to the approval of the SDLP as described above) $1.4 billion, of which $792 million was funded. As of March 31, 2019, the SDLP had commitments to fund delayed draw loans to certain of its portfolio companies of $243 million, which had been approved by the investment committee of the SDLP as described above, of which $58 million was committed by us.

              For more information on the SDLP, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Portfolio and Investment Activity—Senior Direct Lending Program" and Note 4 to our consolidated financial statements for the three months ended March 31, 2019.

Ivy Hill Asset Management, L.P.

              As of March 31, 2019, our portfolio company, IHAM, an SEC-registered investment adviser, managed 21 vehicles and served as the sub-manager/sub-servicer for two other vehicles (such vehicles, the "IHAM Vehicles"). As of March 31, 2019, IHAM had assets under management of approximately $4.6 billion. As of March 31, 2019, the amortized cost and fair value of our investment in IHAM was $444 million and $534 million, respectively. In connection with IHAM's registration as a registered investment adviser, on March 30, 2012, we received exemptive relief from the SEC allowing us to, subject to certain conditions, own directly or indirectly up to 100% of IHAM's outstanding equity interests and make additional investments in IHAM. From time to time, IHAM or certain IHAM Vehicles may purchase investments from us or sell investments to us, in each case for a price equal to the fair market value of such investments determined at the time of such transactions.

Ares Capital Management LLC

              Ares Capital Management, our investment adviser, is served by an origination, investment and portfolio management team of approximately 105 U.S.-based investment professionals as of March 31, 2019, and led by certain partners of the Ares Credit Group: Kipp deVeer, Mitchell Goldstein and Michael Smith. Ares Capital Management leverages off of Ares' investment platform and benefits from the significant capital markets, trading and research expertise of Ares' investment professionals. Ares Capital Management's investment committee has eight members primarily comprised of certain of the U.S.-based partners of the Ares Credit Group.

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MARKET OPPORTUNITY

              We believe that current market conditions present attractive opportunities for us to invest in middle-market companies, specifically:

COMPETITIVE ADVANTAGES

              We believe that we have the following competitive advantages over other capital providers to middle-market companies:

The Ares Platform

              Ares operates three distinct but complementary investment groups, including the Ares Credit Group, the Ares Private Equity Group and the Ares Real Estate Group. We believe our affiliation with Ares provides a distinct competitive advantage through Ares' originations, due diligence, and marketing activities. In particular, we believe that the Ares platform provides us with an advantage through its deal flow generation and investment evaluation process. Ares' asset management platform also provides additional market information, company knowledge and industry insight that benefit our investment

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and due diligence process. Ares' professionals maintain extensive financial sponsor and intermediary relationships, which provide valuable insight and access to transactions and information.

Seasoned Management Team

              The investment professionals in the Ares Credit Group and members of our investment adviser's investment committee also have significant experience investing across market cycles. This experience also provides us with a competitive advantage in identifying, originating, investing in and managing a portfolio of investments in middle-market companies.

Broad Origination Strategy

              We focus on self-originating most of our investments by pursuing a broad array of investment opportunities in middle-market companies and power generation projects across multiple channels. We also leverage off of the extensive relationships of the broader Ares platform, including relationships with the portfolio companies in the IHAM Vehicles, to identify investment opportunities. Additionally, our size and scale provide the opportunity to source attractive investments in some of our existing portfolio companies. Collectively, we believe these advantages allow for enhanced asset selectivity as we believe there is a significant relationship between proprietary deal origination and credit performance. We believe that our focus on generating proprietary deal flow and lead investing also gives us greater control over capital structure, deal terms, pricing and documentation and enables us to actively manage our portfolio investments. Moreover, by leading the investment process, we are often able to secure controlling positions in credit tranches, thereby providing additional control in investment outcomes. We also have originated substantial proprietary deal flow from middle-market intermediaries, which often allows us to act as the sole or principal source of institutional capital to the borrower.

Scale and Flexible Transaction Structuring

              We believe that being one of the largest BDCs makes us a more desirable and flexible capital provider, especially in competitive markets. We are flexible with the types of investments we make and the terms associated with those investments. We believe this approach and experience enables our investment adviser to identify attractive investment opportunities throughout economic cycles and across a company's capital structure so we can make investments consistent with our stated investment objective and preserve principal while seeking appropriate risk adjusted returns. In addition, we have the flexibility to provide "one stop" financing with the ability to invest capital across the balance sheet and syndicate and hold larger investments than many of our competitors. We believe that the ability to underwrite, syndicate and hold larger investments benefits our stockholders by (a) potentially increasing net income and earnings through leadership of the investment process and making commitments in excess of our final investment, (b) increasing originated deal flow flexibility, (c) broadening market relationships and deal flow, (d) allowing us to optimize our portfolio composition and (e) allowing us to provide capital to a broader spectrum of middle-market companies, which we believe currently have limited access to capital from traditional lending sources. In addition, we believe that the ability to provide capital at every level of the balance sheet provides a strong value proposition to middle-market borrowers and our senior debt capabilities provide superior deal origination and relative value analysis capabilities compared to junior capital focused lenders.

Experience with and Focus on Middle-Market Companies

              Ares has historically focused on investments in middle-market companies and we benefit from this experience. In sourcing and analyzing deals, our investment adviser benefits from Ares' extensive network of relationships focused on middle-market companies, including management teams, members of the investment banking community, private equity groups and other investment firms with whom Ares has had long-term relationships. We believe this network enables us to identify well-positioned

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prospective portfolio company investments. The Ares Credit Group works closely with Ares' other investment professionals. As of March 31, 2019, Ares oversaw a portfolio of investments in approximately 1,700 companies, approximately 520 structured assets and approximately 170 properties across approximately 60 industries, which provides access to an extensive network of relationships and insights into industry trends and the state of the capital markets.

Disciplined Investment Philosophy

              In making its investment decisions, our investment adviser has adopted Ares' long-standing, consistent, credit-based investment approach that was developed over 20 years ago by its founders. Specifically, our investment adviser's investment philosophy, portfolio construction and portfolio management involve an assessment of the overall macroeconomic environment and financial markets and company-specific research and analysis. Its investment approach emphasizes capital preservation, low volatility and minimization of downside risk. In addition to engaging in extensive due diligence from the perspective of a long-term investor, our investment adviser's approach seeks to reduce risk in investments by focusing on:

Extensive Industry Focus

              We seek to concentrate our investing activities in industries with a history of predictable and dependable cash flows and in which the Ares investment professionals have had extensive investment experience. Ares investment professionals have developed long-term relationships with management teams and management consultants in approximately 60 industries, and have accumulated substantial information and identified potential trends within these industries. In turn, we benefit from these relationships, information and identification of potential trends in making investments.

OPERATING AND REGULATORY STRUCTURE

              Our investment activities are managed by our investment adviser, Ares Capital Management, which is a subsidiary of Ares, and supervised by our board of directors, a majority of whom are independent of Ares and its affiliates. Ares Capital Management is registered under the Investment Advisers Act of 1940, or the "Advisers Act." Under our Amended and Restated Investment Advisory and Management Agreement with Ares Capital Management, referred to herein as our "investment advisory and management agreement," we have agreed to pay Ares Capital Management base management fees based on our total assets, as defined under the Investment Company Act (other than cash and cash equivalents, but including assets purchased with borrowed funds) ("base management fees"), fees based on our net investment income ("income based fees") and fees based on our net capital gains ("capital gains incentive fees"). See "Management—Investment Advisory and Management Agreement." Ares Operations provides us with certain administrative and other services necessary for us to operate pursuant to an Amended and Restated Administration Agreement, referred to herein as our "administration agreement." See "Management—Administration Agreement."

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              As a BDC, we are required to comply with certain regulatory requirements. For example, we are not generally permitted to co-invest in any portfolio company in which a fund managed by Ares or any of its downstream affiliates (other than us and our downstream affiliates) is also co-investing. On January 18, 2017, we received an order from the SEC that permits us and other BDCs and registered closed-end management investment companies managed by Ares to co-invest in portfolio companies with each other and with affiliated investment funds (the "Co-investment Exemptive Order"). Co-investments made under the Co-investment Exemptive Order are subject to compliance with certain conditions and other requirements, which could limit our ability to participate in a co-investment transaction. We may also otherwise co-invest with funds managed by Ares or any of its downstream affiliates, subject to compliance with existing regulatory guidance, applicable regulations and our allocation procedures.

              Also, while we may borrow funds to make investments, our ability to use debt is limited in certain significant aspects. See "Business—Operating and Regulatory Structure" and "Regulation." In particular, under the provisions of the Investment Company Act, BDCs must have at least 200% asset coverage calculated pursuant to the Investment Company Act (i.e., we are permitted to borrow one dollar for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us) in order to incur debt or issue preferred stock (which we refer to collectively as "senior securities") unless the BDC obtains approval (either stockholder approval or approval of a "required majority" of its board of directors) to apply the modified asset coverage requirements set forth in Section 61(a)(2) of the Investment Company Act, as amended by the Small Business Credit Availability Act (the "SBCAA"), reducing the required asset coverage ratio applicable to the BDC from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us).

              Currently, our asset coverage requirement applicable to senior securities is 200%. On June 21, 2018, our board of directors, including a "required majority" of our board of directors, approved the application of the modified asset coverage requirement set forth in Section 61(a)(2) of the Investment Company Act, as amended by the SBCAA. As a result, effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150%. In October 2018, we entered into certain amendments for our Revolving Credit Facility (as defined below) and Revolving Funding Facility (as defined below) to reduce the asset coverage requirements specified therein to 150%. See "Risk Factors—Risks Relating to Our Business—Effective on June 21, 2019, our asset coverage requirement will reduce from 200% to 150%, which may increase the risk of investing with us" and "Management's Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition, Liquidity and Capital Resources."

              As of March 31, 2019, our asset coverage was 215%.

              In addition, as a consequence of us being a regulated investment company ("RIC") under the Internal Revenue Code of 1986, as amended (the "Code"), for U.S. federal income tax purposes, our asset growth is dependent on our ability to raise equity capital through the issuance of common stock. RICs generally must distribute substantially all of their investment company taxable income (as defined under the Code) to stockholders as dividends in order to preserve their status as a RIC and not to be subject to additional U.S. federal corporate-level income taxes. This requirement, in turn, generally prevents us from using our earnings to support our operations, including making new investments. See "Certain Material U.S. Federal Income Tax Considerations."

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ACQUISITION OPPORTUNITIES

              We believe that there may be opportunity for further consolidation in our industry. From time to time, we evaluate potential strategic opportunities, including acquisitions of:

              We have been in, and from time to time may engage in, discussions with counterparties in respect of various potential strategic acquisition and investment transactions, including potential acquisitions of other finance companies, business development companies and asset managers. Some of these transactions could be material to our business and, if completed, could be difficult to integrate, result in increased leverage or dilution and/or subject us to unexpected liabilities. However, none of these discussions has progressed to the point at which the completion of any such transaction could be deemed to be probable or reasonably certain as of the date of this prospectus. Completion of any such transaction would be subject to completion of due diligence, finalization of key business and financial terms (including price) and negotiation of final definitive documentation as well as a number of other factors and conditions including, without limitation, the approval of our board of directors, any required third party consents and, in certain cases, the approval of our stockholders. We cannot predict how quickly the terms of any such transaction could be finalized, if at all. Accordingly, there can be no assurance that such transaction would be completed. In connection with evaluating potential strategic acquisition and investment transactions, we may incur significant expenses for the evaluation and due diligence investigation of these potential transactions.

INDEBTEDNESS

              As of March 31, 2019, we had approximately $6.3 billion in aggregate principal amount of total outstanding indebtedness, approximately $3.6 billion aggregate principal amount of which was unsecured indebtedness of Ares Capital, approximately $2.0 billion aggregate principal amount of which was secured indebtedness at the Ares Capital level and approximately $725 million aggregate principal amount of which was secured indebtedness of our consolidated subsidiaries.

              For more information on our debt, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition, Liquidity and Capital Resources."

RECENT DEVELOPMENTS

              In April 2019, we amended and restated the Revolving Credit Facility (as defined below) to, among other things, (a) increase the total size under the Revolving Credit Facility from approximately $2.1 billion to approximately $3.4 billion, (b) increase the size of the letter of credit sub-facility from $150 million to $200 million, with our ability to increase incrementally by $75 million on an uncommitted basis, (c) extend the expiration of the revolving period with respect to all commitments of the lenders under the credit facility to March 30, 2023, during which period we, subject to certain conditions, may make borrowings under the credit facility, and (d) extend the stated maturity date with respect to all commitments of the lenders under the credit facility to March 30, 2024.

              On April 24, 2019, at an in-person meeting, our board of directors approved the form of Second Amended and Restated Advisory and Management Agreement to be entered into by us and our investment adviser, effective as of June 6, 2019. The Second Amended and Restated Advisory and Management Agreement will reduce the rate used in calculating the base management fee calculated

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thereunder from 1.50% to 1.00% per annum with respect to assets financed using leverage over 1.0x debt to equity.

              On April 24, 2019, our board of directors appointed (i) Lisa Morgan as Chief Compliance Officer of the Company, replacing Miriam Krieger who had served in such capacity since July 2011, and (ii) Miriam Krieger as Vice President of the Company.

RISK FACTORS

              Investing in Ares Capital involves risks. The following is a summary of the principal risks that you should carefully consider before investing in our securities. In addition, see "Risk Factors" beginning on page 23 for a more detailed discussion of the principal risks as well as certain other risks you should carefully consider before deciding to invest in our securities.

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OUR CORPORATE INFORMATION

              Our administrative offices are located at 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067, telephone number (310) 201-4200, and our principal executive offices are located at 245 Park Avenue, 44th Floor, New York, New York 10167, telephone number (212) 750-7300.

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OFFERINGS

              We may offer, from time to time, in one or more offerings or series, up to $3,000,000,000 of our common stock, preferred stock, debt securities, subscription rights to purchase shares of our common stock, warrants representing rights to purchase shares of our common stock, preferred stock or debt securities, or units comprised of any combination of the foregoing, on terms to be determined at the time of the offering. We will offer our securities at prices and on terms to be set forth in one or more supplements to this prospectus. The offering price per share of our common stock, less any underwriting commissions or discounts, generally will not be less than the net asset value per share of our common stock at the time of an offering. However, we may issue shares of our common stock pursuant to this prospectus at a price per share that is less than our net asset value per share (a) in connection with a rights offering to our existing stockholders, (b) with the prior approval of the majority of our common stockholders or (c) under such other circumstances as the SEC may permit. Any such issuance of shares of our common stock below net asset value may be dilutive to the net asset value of our common stock. See "Risk Factors—Risks Relating to Offerings Pursuant to this Prospectus."

              Pursuant to approval granted at a special meeting of stockholders held on May 14, 2018, we were permitted to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors. Such stockholder approval expired on May 14, 2019. On April 10, 2019, we filed a definitive proxy statement (the "2019 Special Meeting Proxy Statement") for a special meeting of the stockholders, currently expected to take place on June 10, 2019. The 2019 Special Meeting Proxy Statement sets forth a proposal to be voted upon at the special meeting that, if approved by stockholders, would authorize us to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors, for a twelve-month period expiring on the one-year anniversary of the date of the special meeting.

              We may offer our securities directly to one or more purchasers, including existing stockholders in a rights offering, through agents that we designate from time to time or to or through underwriters or dealers. The prospectus supplement relating to each offering will identify any agents or underwriters involved in the sale of our securities, and will set forth any applicable purchase price, fee, commission or discount arrangement between us and our agents or underwriters or among our underwriters or the basis upon which such amount may be calculated. See "Plan of Distribution." We may not sell any of our securities through agents, underwriters or dealers without delivery of a prospectus supplement describing the method and terms of the offering of our securities.

              Set forth below is additional information regarding offerings of our securities:

Use of proceeds

  Unless otherwise specified in a prospectus supplement, we intend to use the net proceeds from the sale of our securities for general corporate purposes, which include, among other things, (a)  investing in portfolio companies in accordance with our investment objective and (b) repaying indebtedness. Each supplement to this prospectus relating to an offering will more fully identify the use of the proceeds from such offering. See "Use of Proceeds."

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Distributions

 

We currently intend to pay dividends or make other distributions to our stockholders on a quarterly basis out of assets legally available for distribution. We may also pay additional dividends or make additional distributions to our stockholders from time to time. Our quarterly and additional dividends or distributions, if any, will be determined by our board of directors. For more information, see "Price Range of Common Stock and Distributions."

Taxation

 

We have elected to be treated as a RIC for U.S. federal income tax purposes. As a RIC, we generally will not pay U.S. federal corporate-level income taxes on any income and gain that we distribute to our stockholders as dividends on a timely basis. Among other things, in order to maintain our RIC status, we must meet specified source of income and asset diversification requirements and distribute annually generally an amount equal to at least 90% of our investment company taxable income, out of assets legally available for distribution. See "Risk Factors—Risks Relating to Our Business—We may be subject to additional corporate-level income taxes if we fail to maintain our status as a RIC" and "Price Range of Common Stock and Distributions."

Dividend reinvestment plan

 

We have a dividend reinvestment plan for our stockholders. This is an "opt out" dividend reinvestment plan. As a result, if we declare a cash dividend, then stockholders' dividends will be automatically reinvested in additional shares of our common stock, unless they specifically "opt out" of the dividend reinvestment plan so as to receive cash. Stockholders whose cash dividends are reinvested in additional shares of our common stock will be subject to the same U.S. federal, state and local tax consequences as stockholders who elect to receive their dividends in cash. See "Dividend Reinvestment Plan."

The NASDAQ Global Select Market symbol

 

"ARCC"

Anti-takeover provisions

 

Our board of directors is divided into three classes of directors serving staggered three-year terms. This structure is intended to provide us with a greater likelihood of continuity of management, which may be necessary for us to realize the full value of our investments. A staggered board of directors also may serve to deter hostile takeovers or proxy contests, as may certain other measures adopted by us. See "Description of Our Capital Stock."

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Leverage

 

We borrow funds to make additional investments. We use this practice, which is known as "leverage," to attempt to increase returns to our stockholders, but it involves significant risks. See "Risk Factors," "Senior Securities" and "Regulation—Indebtedness and Senior Securities." We are currently allowed to borrow amounts such that our asset coverage, as calculated pursuant to the Investment Company Act, equals at least 200% after such borrowing. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition, Liquidity and Capital Resources." The amount of leverage that we employ at any particular time will depend on our investment adviser's and our board of directors' assessments of market and other factors at the time of any proposed borrowing.

Management arrangements

 

Ares Capital Management serves as our investment adviser. Ares Operations serves as our administrator. For a description of Ares Capital Management, Ares Operations, Ares and our contractual arrangements with these companies, see "Management—Investment Advisory and Management Agreement," and "—Administration Agreement."

Available information

 

We are required to file periodic reports, proxy statements and other information with the SEC. This information is available free of charge by calling us collect at (310) 201-4200 or on our website at www.arescapitalcorp.com. Information contained on our website is not incorporated into this prospectus and you should not consider such information to be part of this prospectus. Such information is also available from the EDGAR database on the SEC's website at www.sec.gov .

Incorporation of certain information by reference

 

This prospectus is part of a registration statement that we have filed with the SEC. In accordance with the SBCAA, we are allowed to "incorporate by reference" the information that we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to comprise a part of this prospectus from the date we file any such document. Any reports filed by us with the SEC subsequent to the date of this prospectus and before the date that any offering of any securities by means of this prospectus and any supplement thereto is terminated will automatically update and, where applicable, supersede any information contained in this prospectus or incorporated by reference in this prospectus. See "Incorporation of Certain Information by Reference."

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FEES AND EXPENSES

              The following table is intended to assist you in understanding the costs and expenses that an investor in our common stock will bear, directly or indirectly, based on the assumptions set forth below. We caution you that some of the percentages indicated in the table below are estimates and may vary. Except where the context suggests otherwise, whenever this table contains a reference to our fees or expenses, we will pay such fees and expenses out of our net assets and, consequently, stockholders will indirectly bear such fees or expenses as investors in Ares Capital.

Stockholder transaction expenses (as a percentage of offering price):

     

Sales load

       (1)

Offering expenses

       (2)

Dividend reinvestment plan expenses

  Up to $15
Transaction Fee

     (3)

Total stockholder transaction expenses paid

       (4)

Annual expenses (as a percentage of consolidated net assets attributable to common stock)(5):

     

Base management fees

  2.75% (6)

Income based fees and capital gains incentive fees (excluding the Fee Waiver (as defined below))

  2.72% (7)

Interest payments on borrowed funds

  3.70% (8)

Other expenses

  0.81% (9)

Acquired fund fees and expenses

  1.67% (10)

Total annual expenses

  11.65% (11)

Fee Waiver

  (0.41) %(12)

Total annual expenses after the Fee Waiver

  11.24 %(11)(12)

(1)
In the event that the securities to which this prospectus relates are sold to or through underwriters, a corresponding prospectus supplement will disclose the applicable sales load (underwriting discount or commission). Purchases of shares of our common stock on the secondary market are not subject to sales charges but may be subject to brokerage commissions or other charges. The table does not include any sales load that stockholders may have paid in connection with their purchase of shares of our common stock.

(2)
The related prospectus supplement will disclose the estimated amount of offering expenses, the offering price and the offering expenses borne by us as a percentage of the offering price.

(3)
The expenses of the dividend reinvestment plan are included in "Other expenses." The plan administrator's fees under the plan are paid by us. If a participant elects by notice to the plan administrator in advance of termination to have the plan administrator sell part or all of the shares held by the plan administrator in the participant's account and remit the proceeds to the participant, the plan administrator is authorized to deduct a transaction fee of up to $15 plus a $0.12 per share fee from the proceeds. See "Dividend Reinvestment Plan" for more information.

(4)
The related prospectus supplement will disclose the offering price and the total stockholder transaction expenses as a percentage of the offering price.

(5)
The "consolidated net assets attributable to common stock" used to calculate the percentages in this table is our average net assets of $7.3 billion for the three months ended March 31, 2019.

(6)
Our base management fee is currently calculated at an annual rate of 1.5% of our total assets (other than cash and cash equivalents but including assets purchased with borrowed funds). Our

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(7)
This item represents our investment adviser's income based fees and capital gains incentive fees estimated by annualizing income based fees for the three months ended March 31, 2019 without taking into account the Fee Waiver, and the capital gains incentive fee expense accrued in accordance with U.S. generally accepted accounting principles ("GAAP") for the three months ended March 31, 2019, even though no capital gains incentive fee was actually payable under the investment advisory and management agreement as of March 31, 2019.


GAAP requires that the capital gains incentive fee accrual consider the cumulative aggregate unrealized capital appreciation in the calculation, as a capital gains incentive fee would be payable if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the Investment Company Act or the investment advisory and management agreement. This GAAP accrual is calculated using the aggregate cumulative realized capital gains and losses and aggregate cumulative unrealized capital depreciation included in the calculation of the capital gains incentive fee actually payable under the investment advisory and management agreement plus the aggregate cumulative unrealized capital appreciation. If such amount is positive at the end of a period, then GAAP requires us to record a capital gains incentive fee equal to 20% of such cumulative amount, less the aggregate amount of actual capital gains incentive fees paid or capital gains incentive fees accrued under GAAP in all prior periods. The resulting accrual for any capital gains incentive fee under GAAP in a given period may result in an additional expense if such cumulative amount is greater than in the prior period or a reversal of previously recorded expense if such cumulative amount is less than in the prior period. If such cumulative amount is negative, then there is no accrual. There can be no assurance that such unrealized capital appreciation will be realized in the future or that the amount accrued for will ultimately be paid.



For purposes of this table, we have assumed that these fees will be payable (in the case of the capital gains incentive fee) and that they will remain constant, although they are based on our performance and will not be paid unless we achieve certain goals. We expect to invest or otherwise utilize all of the net proceeds from securities registered under the registration statement of which this prospectus is a part pursuant to a particular prospectus supplement within three months of the date of the offering pursuant to such prospectus supplement and may have capital gains and interest income that could result in the payment of these fees to our investment adviser in the first year after completion of offerings pursuant to this prospectus. Since our IPO through March 31, 2019, the average quarterly fees accrued related to income based fees and capital gains incentive fees (including capital gains incentive fees accrued under GAAP even though they may not be payable) have been approximately 0.64% of our weighted average net assets for such period (2.56% on an annualized basis). For more detailed information on the calculation of our income based fees and capital gains incentive fees, please see below. For more detailed information about income based fees and capital gains incentive fees previously incurred by us, please see Note 3 to

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Income based fees are payable quarterly in arrears in an amount equal to 20% of our pre-incentive fee net investment income (including interest that is accrued but not yet received in cash), subject to a 1.75% quarterly (7.0% annualized) hurdle rate and a "catch-up" provision measured as of the end of each calendar quarter. Under this provision, in any calendar quarter, our investment adviser receives no income based fees until our net investment income equals the hurdle rate of 1.75% but then receives, as a "catch-up," 100% of our pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 2.1875%. The effect of this provision is that, if pre-incentive fee net investment income exceeds 2.1875% in any calendar quarter, our investment adviser will receive 20% of our pre-incentive fee net investment income as if a hurdle rate did not apply.



Capital gains incentive fees are payable annually in arrears in an amount equal to 20% of our realized capital gains on a cumulative basis from inception through the end of the year, if any, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of capital gains incentive fees paid in all prior years.



We will defer cash payment of any income based fees and capital gains incentive fees otherwise earned by our investment adviser if, during the most recent four full calendar quarter period ending on or prior to the date such payment is to be made, the sum of (a) our aggregate distributions to our stockholders and (b) our change in net assets (defined as total assets less indebtedness and before taking into account any income based fees or capital gains incentive fees accrued during the period) is less than 7.0% of our net assets (defined as total assets less indebtedness) at the beginning of such period. Any deferred income based fees and capital gains incentive fees are carried over for payment in subsequent calculation periods to the extent such payment is payable under the investment advisory and management agreement.



These calculations will be adjusted for any share issuances or repurchases.



See "Management—Investment Advisory and Management Agreement."

(8)
"Interest payments on borrowed funds" represents our interest expenses estimated by annualizing our actual interest and credit facility expenses incurred for the three months ended March 31, 2019. During the three months ended March 31, 2019, our average outstanding borrowings were approximately $5.8 billion and cash paid for interest expense was $95 million. We had outstanding borrowings of approximately $6.3 billion (with a carrying value of approximately $6.2 billion) as of March 31, 2019. This item is based on the assumption that our borrowings and interest costs after an offering will remain similar to those prior to such offering. The amount of leverage that we may employ at any particular time will depend on, among other things, our investment adviser's and our board of directors' assessment of market and other factors at the time of any proposed borrowing. See "Risk Factors—Risks Relating to Our Business—We borrow money, which magnifies the potential for gain or loss on amounts invested and may increase the risk of investing with us." We are currently allowed to borrow amounts such that our asset coverage, as calculated pursuant to the Investment Company Act, equals at least 200% after such borrowing. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). See "Risk Factors—Risks Relating to Our Business—Effective on June 21, 2019, our asset coverage requirement will reduce from 200% to 150%, which may increase the risk of investing with us."

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(9)
Includes our overhead expenses, including payments under our administration agreement based on our allocable portion of overhead and other expenses incurred by Ares Operations in performing its obligations under the administration agreement, and income taxes. Such expenses are estimated by annualizing actual "Other expenses" for the three months ended March 31, 2019. The holders of shares of our common stock (and not the holders of our debt securities or preferred stock, if any) indirectly bear the cost associated with our annual expenses. See "Management—Administration Agreement."

(10)
Our stockholders indirectly bear the expenses of underlying funds or other investment vehicles that would be investment companies under section 3(a) of the Investment Company Act but for the exceptions to that definition provided for in sections 3(c)(1) and 3(c)(7) of the Investment Company Act ("Acquired Funds") in which we invest. Such underlying funds or other investment vehicles are referred to in this prospectus as "Acquired Funds." This amount is estimated based on the estimated annual fees and operating expenses of Acquired Funds in which the Company is invested as of March 31, 2019. Certain of these Acquired Funds are subject to management fees, which generally range from 1% to 2.5% of total net assets, or incentive fees, which generally range between 15% and 25% of net profits. When applicable, fees and operating expenses estimates are based on historic fees and operating expenses for the Acquired Funds. For those Acquired Funds with little or no operating history, fees and operating expenses are estimates based on expected fees and operating expenses stated in the Acquired Funds' offering memorandum, private placement memorandum or other similar communication without giving effect to any performance. Future fees and operating expenses for these Acquired Funds may be substantially higher or lower because certain fees and operating expenses are based on the performance of the Acquired Funds, which may fluctuate over time. Also included with the amount is an estimate of the annual fees and operating expenses of the SDLP. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Portfolio and Investment Activity—Co-Investment Program—Senior Direct Lending Program" and Note 4 to our consolidated financial statements for the year ended December 31, 2018 and the three months ended March 31, 2019 for more information on the SDLP. The annual fees and operating expenses of the SDLP were estimated based on the funded portfolio of the SDLP as of March 31, 2019 and include interest payments on the senior notes and intermediate funding notes provided by Varagon and its clients, which represent 90% of such expenses.

(11)
"Total annual expenses" as a percentage of consolidated net assets attributable to common stock are higher than the total annual expenses percentage would be for a company that is not leveraged. We borrow money to leverage and increase our total assets. The SEC requires that the "Total annual expenses" percentage be calculated as a percentage of net assets (defined as total assets less indebtedness and before taking into account any income based fees or capital gains incentive fees accrued during the period), rather than the total assets, including assets that have been funded with borrowed monies.

(12)
In connection with our acquisition of American Capital, Ltd. ("American Capital") (the "American Capital Acquisition"), our investment adviser has agreed to waive up to $100 million in income based fees from us for the first ten calendar quarters beginning with the second quarter of 2017 and ending with the third quarter of 2019, in an amount equal to the lesser of (1) $10 million of income based fees and (2) the amount of income based fees for each such quarter, in each case, to the extent payable by us in such quarter pursuant to and as calculated under our investment advisory and management agreement (the "Fee Waiver"). This item represents the estimated adjustment of $30 million for 2019 to our investment adviser's income based fees to take into account the Fee Waiver.

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Example

              The following example demonstrates the projected dollar amount of total cumulative expenses over various periods with respect to a hypothetical investment in our common stock. In calculating the following expense amounts, we have assumed that we would have no additional leverage, that none of our assets are cash or cash equivalents and that our annual operating expenses would remain at the levels set forth in the table above. Income based fees and the capital gains incentive fees under the investment advisory and management agreement, which, assuming a 5% annual return, would either not be payable or have an insignificant impact on the expense amounts shown below, are not included in the example, except as specifically set forth below. Transaction expenses are not included in the following example. In the event that shares to which this prospectus relates are sold to or through underwriters, a corresponding prospectus supplement will restate this example to reflect the applicable sales load.

 
  1 year   3 years   5 years   10 years  

You would pay the following expenses on a $1,000 common stock investment, assuming a 5% annual return (none of which is subject to the capital gains incentive fee)(1)

  $ 50   $ 45.93   $ 42.19   $ 34.12  

You would pay the following expenses on a $1,000 common stock investment, assuming a 5% annual return resulting entirely from net realized capital gains (all of which is subject to the capital gains incentive fee)(2)

  $ 50   $ 44.95   $ 40.28   $ 30.11  

(1)
Assumes that we will not realize any capital gains computed net of all realized capital losses and unrealized capital depreciation.

(2)
Assumes no unrealized capital depreciation and a 5% annual return resulting entirely from net realized capital gains and not otherwise deferrable under the terms of the investment advisory and management agreement and therefore subject to the capital gains incentive fee.

              The foregoing table is to assist you in understanding the various costs and expenses that an investor in our common stock will bear directly or indirectly. While the example assumes, as required by the SEC, a 5% annual return, our performance will vary and may result in a return greater or less than 5%. If we were to achieve sufficient returns on our investments, including through the realization of capital gains, to trigger income based fees or capital gains incentive fees of a material amount, our expenses, and returns to our investors, would be higher. In addition, while the example assumes reinvestment of all dividends and distributions at net asset value, if our board of directors authorizes and we declare a cash dividend, participants in our dividend reinvestment plan who have not otherwise elected to receive cash will receive a number of shares of our common stock determined by dividing the total dollar amount of the dividend payable to a participant by the market price per share of our common stock at the close of trading on the valuation date for the dividend. See "Dividend Reinvestment Plan" for additional information regarding our dividend reinvestment plan.

               This example and the expenses in the table above should not be considered a representation of our future expenses as actual expenses (including the cost of debt, if any, and other expenses) that we may incur in the future and such actual expenses may be greater or less than those shown.

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SELECTED CONDENSED CONSOLIDATED FINANCIAL DATA OF ARES CAPITAL

              The following selected financial and other data as of and for the years ended December 31, 2018, 2017, 2016, 2015 and 2014 are derived from our consolidated financial statements, which have been audited by KPMG LLP, an independent registered public accounting firm whose report thereon is included elsewhere in this prospectus. The selected financial and other data as of and for the three months ended March 31, 2019 and March 31, 2018 and other quarterly financial information is derived from our unaudited financial statements, but in the opinion of management, reflects all adjustments (consisting only of normal recurring adjustments) that are necessary to present fairly the results of such interim periods. Interim results as of and for the three months ended March 31, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The data should be read in conjunction with our consolidated financial statements and notes thereto and "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Senior Securities," which are included elsewhere in this prospectus or the accompanying prospectus supplement.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES
SELECTED FINANCIAL DATA
As of and For the Three Months Ended March 31, 2019 and March 31, 2018 and
As of and For the Years Ended December 31, 2018, 2017, 2016, 2015 and 2014
(dollar amounts in millions, except per share data and as otherwise indicated)

 
  As of and For the
Three Months Ended
March 31,
  As of and For the Years Ended
December 31,
 
 
  2019   2018   2018   2017   2016   2015   2014  
 
  (unaudited)
  (unaudited)
   
   
   
   
   
 

Total Investment Income

  $ 373   $ 317   $ 1,337   $ 1,160   $ 1,012   $ 1,025   $ 989  

Total Expenses, Net of Waiver of Income Based Fees

    168     168     624     630     497     499     533  

Net Investment Income Before Income Taxes

    205     149     713     530     515     526     456  

Income Tax Expense, Including Excise Tax

    4     5     19     19     21     18     18  

Net Investment Income

    201     144     694     511     494     508     438  

Net Realized and Unrealized Gains (Losses) on Investments, Foreign Currencies and Other Transactions and Extinguishment of Debt

    13     98     164     156     (20 )   (129 )   153  

Net Increase in Stockholders' Equity Resulting from Operations

  $ 214   $ 242   $ 858   $ 667   $ 474   $ 379   $ 591  

Per Share Data:

                                           

Net Increase in Stockholders' Equity Resulting from Operations:

                                           

Basic

  $ 0.50   $ 0.57   $ 2.01   $ 1.57   $ 1.51   $ 1.20   $ 1.94  

Diluted

  $ 0.50   $ 0.57   $ 2.01   $ 1.57   $ 1.51   $ 1.20   $ 1.94  

Cash Dividends Declared and Payable(1)

  $ 0.42   $ 0.38   $ 1.54   $ 1.52   $ 1.52   $ 1.57   $ 1.57  

Net Asset Value

  $ 17.21   $ 16.84   $ 17.12   $ 16.65   $ 16.45   $ 16.46   $ 16.82  

Total Assets(2)

  $ 13,962   $ 12,693   $ 12,895   $ 12,347   $ 9,245   $ 9,507   $ 9,454  

Total Debt (Carrying Value)(2)

  $ 6,197   $ 5,118   $ 5,214   $ 4,854   $ 3,874   $ 4,114   $ 3,881  

Total Debt (Principal Amount)

  $ 6,293   $ 5,212   $ 5,297   $ 4,943   $ 3,951   $ 4,197   $ 3,999  

Total Stockholders' Equity

  $ 7,339   $ 7,178   $ 7,300   $ 7,098   $ 5,165   $ 5,173   $ 5,284  

Other Data:

                                           

Number of Portfolio Companies at Period End(3)

    345     360     344     314     218     218     205  

Principal Amount of Investments Purchased(4)

  $ 1,941   $ 1,619   $ 7,176   $ 7,263   $ 3,490   $ 3,905   $ 4,534  

Principal Amount of Investments Acquired as part of the American Capital Acquisition on January 3, 2017

  $   $   $   $ 2,543   $   $   $  

Principal Amount of Investments Sold and Repayments

  $ 1,289   $ 1,378   $ 6,440   $ 7,107   $ 3,655   $ 3,651   $ 3,213  

Total Return Based on Market Value(5)

    12.7 %   3.4 %   8.9 %   4.5 %   26.4 %   1.3 %   (3.3 )%

Total Return Based on Net Asset Value(6)

    3.0 %   3.4 %   12.1 %   10.5 %   9.2 %   7.2 %   11.8 %

Weighted Average Yield of Debt and Other Income Producing Securities at Fair Value(7)

    10.5 %   10.1 %   10.3 %   9.8 %   9.4 %   10.3 %   10.1 %

Weighted Average Yield of Debt and Other Income Producing Securities at Amortized Cost(7)

    10.4 %   10.1 %   10.2 %   9.7 %   9.3 %   10.1 %   10.1 %

Weighted Average Yield of Total Investments at Fair Value(8)

    9.5 %   9.3 %   9.3 %   8.7 %   8.5 %   9.2 %   9.1 %

Weighted Average Yield of Total Investments at Amortized Cost(8)

    9.3 %   9.0 %   9.0 %   8.7 %   8.3 %   9.1 %   9.3 %

(1)
Includes an additional dividend of $0.02 per share paid in the quarter ended March 31, 2019, an additional dividend of $0.05 per share paid in the year ended December 31, 2015 and an additional dividend of $0.05 per share paid in the year ended December 31, 2014.

(2)
Certain prior year amounts have been reclassified to conform to the 2016 presentation. In particular, unamortized debt issuance costs were previously included in other assets and were reclassified to long-term debt as a result of the adoption of Accounting Standards Update ("ASU") 2015-03, Interest—Imputation of Interest (Topic 835): Simplifying the Presentation of Debt Issuance Costs, during the first quarter of 2016.

(3)
Includes commitments to portfolio companies for which funding had yet to occur.

(4)
Excludes $2.5 billion of investments acquired as part of the American Capital Acquisition on January 3, 2017.

(5)
For the three months ended March 31, 2019, the total return based on market value equaled the increase of the ending market value at March 31, 2019 of $17.14 per share from the ending market value at December 31, 2018 of $15.58 per share plus the declared and payable dividends of $0.42 per share for the three months ended March 31, 2019, divided by

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    the market value at December 31, 2018. For the three months ended March 31, 2018, the total return based on market value equaled the increase of the ending market value at March 31, 2018 of $15.87 per share from the ending market value at December 31, 2017 of $15.72 per share plus the declared and payable dividends of $0.38 per share for the three months ended March 31, 2018, divided by the market value at December 31, 2017. For the year ended December 31, 2018, the total return based on market value equaled the decrease of the ending market value at December 31, 2018 of $15.58 per share from the ending market value at December 31, 2017 of $15.72 per share plus the declared and payable dividends of $1.54 per share for the year ended December 31, 2018, divided by the market value at December 31, 2017. For the year ended December 31, 2017, the total return based on market value equaled the decrease of the ending market value at December 31, 2017 of $15.72 per share from the ending market value at December 31, 2016 of $16.49 per share plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2017, divided by the market value at December 31, 2016. For the year ended December 31, 2016, the total return based on market value equaled the increase of the ending market value at December 31, 2016 of $16.49 per share from the ending market value at December 31, 2015 of $14.25 per share plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2016, divided by the market value at December 31, 2015. For the year ended December 31, 2015, the total return based on market value equaled the decrease of the ending market value at December 31, 2015 of $14.25 per share from the ending market value at December 31, 2014 of $15.61 per share plus the declared and payable dividends of $1.57 per share for the year ended December 31, 2015, divided by the market value at December 31, 2014. For the year ended December 31, 2014, the total return based on market value equaled the decrease of the ending market value at December 31, 2014 of $15.61 per share from the ending market value at December 31, 2013 of $17.77 per share plus the declared and payable dividends of $1.57 per share for the year ended December 31, 2014, divided by the market value at December 31, 2013. Our shares fluctuate in value. Our performance changes over time and currently may be different than that shown. Past performance is no guarantee of future results.

(6)
For the three months ended March 31, 2019, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $0.42 per share for the three months ended March 31, 2019, divided by the beginning net asset value for the period. For the three months ended March 31, 2018, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $0.38 per share for the three months ended March 31, 2018, divided by the beginning net asset value for the period. For the year ended December 31, 2018, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.54 per share for the year ended December 31, 2018, divided by the beginning net asset value for the period. For the year ended December 31, 2017, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2017, divided by the beginning net asset value for the period. For the year ended December 31, 2016, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2016, divided by the beginning net asset value for the period. For the year ended December 31, 2015, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.57 per share for the year ended December 31, 2015, divided by the beginning net asset value for the period. For the year ended December 31, 2014, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.57 per share for the year ended December 31, 2014 divided by the beginning net asset value for the period. These calculations are adjusted for shares issued in connection with the dividend reinvestment plan and the issuance of common stock in connection with any equity offerings and the equity components of any convertible notes issued during the period. Our performance changes over time and currently may be different than that shown. Past performance is no guarantee of future results.

(7)
"Weighted average yield of debt and other income producing securities" is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of original issue discount and market discount or premium earned on accruing debt and other income producing securities, divided by (b) the total accruing debt and other income producing securities at amortized cost or at fair value, as applicable.

(8)
"Weighted average yield on total investments" is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of original issue discount and market discount or premium earned on accruing debt and other income producing securities, divided by (b) the total investments at amortized cost or at fair value, as applicable.

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SELECTED QUARTERLY DATA (Unaudited)
(dollar amounts in millions, except per share data)

 
  2019  
 
  Q4   Q3   Q2   Q1  

Total investment income

              $ 373  

Net investment income before net realized and unrealized gains and income based fees and capital gains incentive fees, net of waiver of income based fees

              $ 241  

Income based fees and capital gains incentive fees, net of waiver of income based fees

              $ 40  

Net investment income before net realized and unrealized gains

              $ 201  

Net realized and unrealized gains

              $ 13  

Net increase in stockholders' equity resulting from operations

              $ 214  

Basic and diluted earnings per common share

              $ 0.50  

Net asset value per share as of the end of the quarter

              $ 17.21  

 

 
  2018  
 
  Q4   Q3   Q2   Q1  

Total investment income

  $ 345   $ 342   $ 333   $ 317  

Net investment income before net realized and unrealized gains and income based fees and capital gains incentive fees, net of waiver of income based fees

  $ 229   $ 225   $ 210   $ 192  

Income based fees and capital gains incentive fees, net of waiver of income based fees

  $ 26   $ 40   $ 48   $ 48  

Net investment income before net realized and unrealized gains (losses)

  $ 203   $ 185   $ 162   $ 144  

Net realized and unrealized gains (losses)

  $ (50 ) $ 24   $ 92   $ 98  

Net increase in stockholders' equity resulting from operations

  $ 153   $ 209   $ 254   $ 242  

Basic and diluted earnings per common share

  $ 0.36   $ 0.49   $ 0.60   $ 0.57  

Net asset value per share as of the end of the quarter

  $ 17.12   $ 17.16   $ 17.05   $ 16.84  

 

 
  2017  
 
  Q4   Q3   Q2   Q1  

Total investment income

  $ 307   $ 294   $ 284   $ 275  

Net investment income before net realized and unrealized gains and income based fees and capital gains incentive fees, net of waiver of income based fees

  $ 185   $ 175   $ 154   $ 142  

Income based fees and capital gains incentive fees, net of waiver of income based fees

  $ 45   $ 22   $ 30   $ 48  

Net investment income before net realized and unrealized gains (losses)

  $ 140   $ 153   $ 124   $ 94  

Net realized and unrealized gains (losses)

  $ 92   $ (14 ) $ 54   $ 24  

Net increase in stockholders' equity resulting from operations

  $ 232   $ 139   $ 178   $ 118  

Basic and diluted earnings per common share

  $ 0.54   $ 0.33   $ 0.42   $ 0.28  

Net asset value per share as of the end of the quarter

  $ 16.65   $ 16.49   $ 16.54   $ 16.50  

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RISK FACTORS

               You should carefully consider the risk factors described below, together with all of the other information included in this prospectus, the accompanying prospectus supplement and any documents incorporated by reference herein, including our consolidated financial statements and the related notes thereto, before you decide whether to make an investment in our securities. The risks described in such documents and set out below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results. If any of the following events occur, our business, financial condition and results of operations could be materially adversely affected. In such case, the net asset value of our common stock and the trading price, if any, of our securities could decline, and you may lose all or part of your investment.

RISKS RELATING TO OUR BUSINESS

The capital markets may experience periods of disruption and instability. Such market conditions may materially and adversely affect debt and equity capital markets, which may have a negative impact on our business and operations.

              From time to time, capital markets may experience periods of disruption and instability. For example, between 2008 and 2009, the global capital markets were unstable as evidenced by periodic disruptions in liquidity in the debt capital markets, significant write-offs in the financial services sector, the re-pricing of credit risk in the broadly syndicated credit market and the failure of major financial institutions. Despite actions of the U.S. federal government and foreign governments, these events contributed to worsening general economic conditions that materially and adversely impacted the broader financial and credit markets and reduced the availability of debt and equity capital for the market as a whole and financial services firms in particular. While market conditions have largely recovered from the events of 2008 and 2009, there have been continuing periods of volatility, some lasting longer than others. For example, continued uncertainty surrounding the referendum by British voters to exit the European Union ("Brexit") in June 2016 and uncertainty between the United States and other countries with respect to trade policies, treaties, and tariffs, among other factors, have caused disruption in the global markets, including the markets in which we participate. There can be no assurance these market conditions will not continue or worsen in the future.

              Equity capital may be difficult to raise during periods of adverse or volatile market conditions because, subject to some limited exceptions, as a BDC, we are generally not able to issue additional shares of our common stock at a price less than net asset value without first obtaining approval for such issuance from our stockholders and our independent directors. We generally seek approval from our stockholders so that we have the flexibility to issue up to 25% of our then outstanding shares of our common stock at a price below net asset value. Pursuant to approval granted at a special meeting of stockholders held on May 14, 2018, we were permitted to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors. Such stockholder approval expired on May 14, 2019. On April 10, 2019, we filed the 2019 Special Meeting Proxy Statement for a special meeting of the stockholders, currently expected to take place on June 10, 2019. The 2019 Special Meeting Proxy Statement sets forth a proposal to be voted upon at the special meeting that, if approved by stockholders, would authorize us to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors, for a twelve-month period expiring on the one-year anniversary of the date of the special meeting.

              Volatility and dislocation in the capital markets can also create a challenging environment in which to raise or access debt capital. The reappearance of market conditions similar to those experienced from 2008 through 2009 for any substantial length of time could make it difficult to extend

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the maturity of or refinance our existing indebtedness or obtain new indebtedness with similar terms and any failure to do so could have a material adverse effect on our business. The debt capital that will be available to us in the future, if at all, may be at a higher cost and on less favorable terms and conditions than what we currently experience, including being at a higher cost due to a rising rate environment. If we are unable to raise or refinance debt, then our equity investors may not benefit from the potential for increased returns on equity resulting from leverage and we may be limited in our ability to make new commitments or to fund existing commitments to our portfolio companies.

              Significant changes or volatility in the capital markets may also have a negative effect on the valuations of our investments. While most of our investments are not publicly traded, applicable accounting standards require us to assume as part of our valuation process that our investments are sold in a principal market to market participants (even if we plan on holding an investment through its maturity). Significant changes in the capital markets may also affect the pace of our investment activity and the potential for liquidity events involving our investments. Thus, the illiquidity of our investments may make it difficult for us to sell such investments to access capital if required, and as a result, we could realize significantly less than the value at which we have recorded our investments if we were required to sell them for liquidity purposes. An inability to raise or access capital could have a material adverse effect on our business, financial condition or results of operations.

Uncertainty about the financial stability of the United States, China and several countries in Europe could have a significant adverse effect on our business, financial condition and results of operations.

              Due to federal budget deficit concerns, Standard & Poor's Financial Services LLC ("S&P") downgraded the federal government's credit rating from AAA to AA+ for the first time in history on August 5, 2011. Further, Moody's Investor Services, Inc. ("Moody's") and Fitch Ratings, Inc. ("Fitch") had warned that they may downgrade the federal government's credit rating under certain circumstances. Further downgrades or warnings by S&P or other rating agencies, and the United States government's credit and deficit concerns in general, could cause interest rates and borrowing costs to rise, which may negatively impact both the perception of credit risk associated with our debt portfolio and our ability to access the debt markets on favorable terms. In addition, a decreased U.S. government credit rating could create broader financial turmoil and uncertainty, which may weigh heavily on our financial performance and the value of our common stock.

              Deterioration in the economic conditions in the Eurozone and globally, including instability in financial markets, may pose a risk to our business. In recent years, financial markets have been affected at times by a number of global macroeconomic and political events, including the following: large sovereign debts and fiscal deficits of several countries in Europe and in emerging markets jurisdictions, levels of non-performing loans on the balance sheets of European banks, the potential effect of any European country leaving the Eurozone, the potential effect of the United Kingdom leaving the European Union, the potential effect of Scotland leaving the United Kingdom, and market volatility and loss of investor confidence driven by political events, including the general elections in the United Kingdom in June 2017 and in Germany in September 2017 and referenda in the United Kingdom in June 2016 and Italy in December 2016. Market and economic disruptions have affected, and may in the future affect, consumer confidence levels and spending, personal bankruptcy rates, levels of incurrence and default on consumer debt and home prices, among other factors. We cannot assure you that market disruptions in Europe, including the increased cost of funding for certain governments and financial institutions, will not impact the global economy, and we cannot assure you that assistance packages will be available, or if available, be sufficient to stabilize countries and markets in Europe or elsewhere affected by a financial crisis. To the extent uncertainty regarding any economic recovery in Europe negatively impacts consumer confidence and consumer credit factors, our business, financial condition and results of operations could be significantly and adversely affected.

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              In the second quarter of 2015, stock prices in China experienced a significant drop, resulting primarily from continued sell-off of shares trading in Chinese markets. In addition, in August 2015, Chinese authorities sharply devalued China's currency. Since then, the Chinese capital markets have continued to experience periods of instability. The current political climate has also intensified concerns about a potential trade war between the United States and China in connection with each country's recent or proposed tariffs on the other country's products. These market and economic disruptions and the potential trade war with China have affected, and may in the future affect, the U.S. capital markets, which could adversely affect our business, financial condition or results of operations.

              Although the Federal Reserve elected not to raise the federal funds rate at its first quarter 2019 meeting, it had previously raised the federal funds rate nine times during the period between December 2015 and December 2018. Any future adjustments to the federal funds rate, the United States government's credit and deficit concerns, the European sovereign debt crisis, the economic slowdown in China and the potential trade war with China could cause interest rates to be volatile, which may negatively impact our ability to access the debt markets on favorable terms.

A failure on our part to maintain our status as a BDC may significantly reduce our operating flexibility.

              If we fail to maintain our status as a BDC, we might be regulated as a closed-end investment company that is required to register under the Investment Company Act, which would subject us to additional regulatory restrictions and significantly decrease our operating flexibility. In addition, any such failure could cause an event of default under our outstanding indebtedness, which could have a material adverse effect on our business, financial condition or results of operations.

We are dependent upon certain key personnel of Ares for our future success and upon their access to other Ares investment professionals.

              We depend on the diligence, skill and network of business contacts of certain key personnel of the Ares Credit Group. We also depend, to a significant extent, on access to the investment professionals of other groups within Ares and the information and deal flow generated by Ares' investment professionals in the course of their investment and portfolio management activities. Our future success depends on the continued service of certain key personnel of the Ares Credit Group. The departure of any of these individuals, or of a significant number of the investment professionals or partners of Ares, could have a material adverse effect on our business, financial condition or results of operations. In addition, we cannot assure you that Ares Capital Management will remain our investment adviser or that we will continue to have access to Ares' investment professionals or its information and deal flow. Further, there can be no assurance that Ares Capital will replicate its own or Ares' historical success, and we caution you that our investment returns could be substantially lower than the returns achieved by other Ares-managed funds.

Our financial condition and results of operations depend on our ability to manage future growth effectively.

              Our ability to achieve our investment objective depends on our ability to acquire suitable investments and monitor and administer those investments, which depends, in turn, on our investment adviser's ability to identify, invest in and monitor companies that meet our investment criteria.

              Accomplishing this result on a cost-effective basis is largely a function of the structuring of our investment process and the ability of our investment adviser to provide competent, attentive and efficient services to us. Our executive officers and the members of our investment adviser's investment committee have substantial responsibilities in connection with their roles at Ares and with the other Ares funds, as well as responsibilities under the investment advisory and management agreement. They may also be called upon to provide significant managerial assistance to certain of our portfolio

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companies. These demands on their time, which will increase as the number of investments grow, may distract them or slow the rate of investment. In order to grow, Ares will need to hire, train, supervise, manage and retain new employees. However, we cannot assure you that Ares will be able to do so effectively. Any failure to manage our future growth effectively could have a material adverse effect on our business, financial condition and results of operations.

Our ability to grow depends on our ability to raise capital.

              We will need to periodically access the capital markets to raise cash to fund new investments in excess of our repayments, and we may also need to access the capital markets to refinance existing debt obligations to the extent such maturing obligations are not repaid with availability under our revolving credit facilities or cash flows from operations. We have elected to be treated as a RIC and operate in a manner so as to qualify for the U.S. federal income tax treatment applicable to RICs. Among other things, in order to maintain our RIC status, we must distribute to our stockholders on a timely basis generally an amount equal to at least 90% of our investment company taxable income, and, as a result, such distributions will not be available to fund investment originations or repay maturing debt. We must continue to borrow from financial institutions and issue additional securities to fund our growth. Unfavorable economic or capital market conditions may increase our funding costs, limit our access to the capital markets or could result in a decision by lenders not to extend credit to us. An inability to successfully access the capital markets may limit our ability to refinance our existing debt obligations as they come due and/or to fully execute our business strategy and could limit our ability to grow or cause us to have to shrink the size of our business, which could decrease our earnings, if any.

              In addition, we are currently allowed to borrow amounts or issue debt securities or preferred stock, which we refer to collectively as "senior securities," such that our asset coverage, as calculated pursuant to the Investment Company Act, equals at least 200% immediately after such borrowing. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). Such requirement, in certain circumstances, may restrict our ability to borrow or issue debt securities or preferred stock. The amount of leverage that we employ will depend on our investment adviser's and our board of directors' assessments of market and other factors at the time of any proposed borrowing or issuance of senior securities. We cannot assure you that we will be able to maintain or increase the amount available to us under our current Facilities (as defined below), obtain other lines of credit or issue senior securities at all or on terms acceptable to us.

Regulations governing our operation as a BDC affect our ability to, and the way in which we, raise additional capital.

              We may issue senior securities or borrow money from banks or other financial institutions, up to the maximum amount permitted by the Investment Company Act. Under the provisions of the Investment Company Act, we are currently permitted, as a BDC, to incur indebtedness or issue senior securities only in amounts such that our asset coverage, as calculated pursuant to the Investment Company Act, equals at least 200% after each such incurrence or issuance. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). If the value of our assets declines, we may be unable to satisfy this test, which may prohibit us from paying dividends and could prevent us from maintaining our status as a RIC or may prohibit us from repurchasing shares of our common stock. In addition, our inability to satisfy this test could cause an event of default under our existing indebtedness. If we cannot satisfy this test, we may be required to sell a portion of our investments at a

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time when such sales may be disadvantageous and, depending on the nature of our leverage, repay a portion of our indebtedness. Accordingly, any failure to satisfy this test could have a material adverse effect on our business, financial condition or results of operations. As of March 31, 2019, our asset coverage calculated in accordance with the Investment Company Act was 215%. Also, to generate cash for funding new investments, we may in the future seek to issue additional debt or to securitize certain of our loans. The Investment Company Act may impose restrictions on the structure of any such securitization.

              We are not generally able to issue and sell our common stock at a price below net asset value per share. We may, however, sell our common stock, or warrants, options or rights to acquire our common stock, at a price below the current net asset value per share of our common stock if our board of directors determines that such sale is in our best interests and the best interests of our stockholders, and our stockholders approve such sale. Any such sale would be dilutive to the net asset value per share of our common stock. In any such case, the price at which our securities are to be issued and sold may not be less than a price that, in the determination of our board of directors, closely approximates the market value of such securities (less any commission or discount). If our common stock trades at a discount to net asset value, this restriction could adversely affect our ability to raise capital.

              Pursuant to approval granted at a special meeting of stockholders held on May 14, 2018, we were permitted to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors. Such stockholder approval expired on May 14, 2019. On April 10, 2019, we filed the 2019 Special Meeting Proxy Statement for a special meeting of the stockholders, currently expected to take place on June 10, 2019. The 2019 Special Meeting Proxy Statement sets forth a proposal to be voted upon at the special meeting that, if approved by stockholders, would authorize us to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors, for a twelve-month period expiring on the one-year anniversary of the date of the special meeting.

We borrow money, which magnifies the potential for gain or loss on amounts invested and may increase the risk of investing with us.

              Borrowings, also known as leverage, magnify the potential for gain or loss on amounts invested and, therefore, increase the risks associated with investing in our securities. We currently borrow under the Facilities and have issued or assumed other senior securities, and in the future may borrow from, or issue additional senior securities to, banks, insurance companies, funds, institutional investors and other lenders and investors. Lenders and holders of such senior securities have fixed dollar claims on our consolidated assets that are superior to the claims of our common stockholders or any preferred stockholders. If the value of our consolidated assets increases, then leveraging would cause the net asset value per share of our common stock to increase more sharply than it would have had we not incurred leverage.

              Conversely, if the value of our consolidated assets decreases, leveraging would cause net asset value to decline more sharply than it otherwise would have had we not incurred leverage. Similarly, any increase in our consolidated income in excess of consolidated interest payable on the borrowed funds would cause our net income to increase more than it would had we not incurred leverage, while any decrease in our consolidated income would cause net income to decline more sharply than it would have had we not incurred leverage. Such a decline could negatively affect our ability to make common stock dividend payments. There can be no assurance that a leveraging strategy will be successful.

              As of March 31, 2019, we had approximately $2.7 billion of outstanding borrowings under the Facilities, approximately $791 million in aggregate principal amount of the Convertible Unsecured Notes (as defined below) and approximately $2.8 billion in aggregate principal amount outstanding of

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the Unsecured Notes (as defined below). In order for us to cover our annual interest payments on our outstanding indebtedness at March 31, 2019, we must achieve annual returns on our March 31, 2019 total assets of at least 1.9%. The weighted average stated interest rate charged on our principal amount of outstanding indebtedness as of March 31, 2019 was 4.1%. We intend to continue borrowing under the Facilities in the future and we may increase the size of the Facilities or issue additional debt securities or other evidences of indebtedness (although there can be no assurance that we will be successful in doing so). For more information on our indebtedness, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition, Liquidity and Capital Resources." Our ability to service our debt depends largely on our financial performance and is subject to prevailing economic conditions and competitive pressures. The amount of leverage that we employ at any particular time will depend on our investment adviser's and our board of directors' assessments of market and other factors at the time of any proposed borrowing. We are currently allowed to borrow amounts such that our asset coverage, as calculated pursuant to the Investment Company Act, equals at least 200% after such borrowing. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). Accordingly, our interest expense as a percentage of our total assets will be higher if we use increased leverage permitted under our modified asset coverage requirement applicable to senior securities.

              The Facilities, the Convertible Unsecured Notes and the Unsecured Notes impose financial and operating covenants that restrict our business activities, including limitations that could hinder our ability to finance additional loans and investments or to make the distributions required to maintain our status as a RIC. A failure to renew the Facilities or to add new or replacement debt facilities or to issue additional debt securities or other evidences of indebtedness could have a material adverse effect on our business, financial condition and results of operations.

              The following table illustrates the effect on return to a holder of our common stock of the leverage created by our use of borrowing at the weighted average stated interest rate of 4.1% as of March 31, 2019, together with (a) our total value of net assets as of March 31, 2019; (b) approximately $6.3 billion in aggregate principal amount of indebtedness outstanding as of March 31, 2019 and (c) hypothetical annual returns on our portfolio of minus 15% to plus 15%.

Assumed Return on Portfolio (Net of Expenses)(1)

    –15.00 %   –10.00 %   –5.00 %   %   5.00 %   10.00 %   15.00 %

Corresponding Return to Common Stockholders(2)

    –32.08 %   –22.57 %   –13.05 %   –3.54 %   5.97 %   15.48 %   25.00 %

(1)
The assumed portfolio return is required by SEC regulations and is not a prediction of, and does not represent, our projected or actual performance. Actual returns may be greater or less than those appearing in the table. Pursuant to SEC regulations, this table is calculated as of March 31, 2019. As a result, it has not been updated to take into account any changes in assets or leverage since March 31, 2019.

(2)
In order to compute the "Corresponding Return to Common Stockholders," the "Assumed Return on Portfolio" is multiplied by the total value of our assets at March 31, 2019 to obtain an assumed return to us. From this amount, the interest expense (calculated by multiplying the weighted average stated interest rate of 4.1% by the approximately $6.3 billion of principal debt outstanding) is subtracted to determine the return available to stockholders. The return available to stockholders is then divided by the total value of our net assets as of March 31, 2019 to determine the "Corresponding Return to Common Stockholders."

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Effective on June 21, 2019, our asset coverage requirement will reduce from 200% to 150%, which may increase the risk of investing with us.

              On June 21, 2018, our board of directors, including a "required majority" of our board of directors, approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the Investment Company Act, as amended by the SBCAA. As a result, effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us), and the risks associated with an investment in us may increase.

In addition to regulatory requirements that restrict our ability to raise capital, the Facilities, the Convertible Unsecured Notes and the Unsecured Notes contain various covenants that, if not complied with, could accelerate repayment under the Facilities, the Convertible Unsecured Notes and the Unsecured Notes, thereby materially and adversely affecting our liquidity, financial condition and results of operations.

              The agreements governing the Facilities, the Convertible Unsecured Notes and the Unsecured Notes require us to comply with certain financial and operational covenants. These covenants may include, among other things:

    restrictions on the level of indebtedness that we are permitted to incur in relation to the value of our assets;

    restrictions on our ability to incur liens; and

    maintenance of a minimum level of stockholders' equity.

              As of the date of this prospectus, we are in compliance in all material respects with the covenants of the Facilities, the Convertible Unsecured Notes and the Unsecured Notes. However, our continued compliance with these covenants depends on many factors, some of which are beyond our control. For example, depending on the condition of the public debt and equity markets and pricing levels, unrealized depreciation in our portfolio may increase in the future. Any such increase could result in our inability to comply with our obligation to restrict the level of indebtedness that we are able to incur in relation to the value of our assets or to maintain a minimum level of stockholders' equity.

              Accordingly, although we believe we will continue to be in compliance, there are no assurances that we will continue to comply with the covenants in the Facilities, the Convertible Unsecured Notes and the Unsecured Notes. Failure to comply with these covenants could result in a default under the Facilities, the Convertible Unsecured Notes or the Unsecured Notes, that, if we were unable to obtain a waiver from the lenders or holders of such indebtedness, as applicable, such lenders or holders could accelerate repayment under such indebtedness and thereby have a material adverse impact on our business, financial condition and results of operations.

We operate in a highly competitive market for investment opportunities.

              A number of entities compete with us to make the types of investments that we make in middle-market companies. We compete with other BDCs, public and private funds, commercial and investment banks, commercial financing companies, insurance companies, hedge funds, and, to the extent they provide an alternative form of financing, private equity funds. Many of our competitors are substantially larger and have considerably greater financial, technical and marketing resources than we do. Some competitors may have a lower cost of funds and access to funding sources that are not available to us. In addition, some of our competitors may have higher risk tolerances or different risk

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assessments, which could allow them to consider a wider variety of investments and establish more relationships than us. Furthermore, many of our competitors are not subject to the regulatory restrictions that the Investment Company Act imposes on us as a BDC and that the Code imposes on us as a RIC. We cannot assure you that the competitive pressures we face will not have a material adverse effect on our business, financial condition and results of operations. Also, as a result of this competition, we may not be able to pursue attractive investment opportunities from time to time.

              We do not seek to compete primarily based on the interest rates we offer and we believe that some of our competitors may make loans with interest rates that are comparable to or lower than the rates we offer. Rather, we compete with our competitors based on our existing investment platform, seasoned investment professionals, experience and focus on middle-market companies, disciplined investment philosophy, extensive industry focus and flexible transaction structuring. For a more detailed discussion of these competitive advantages, see "Business—Competitive Advantages."

              We may lose investment opportunities if we do not match our competitors' pricing, terms and structure. The loss of such investment opportunities may limit our ability to grow or cause us to have to shrink the size of our portfolio, which could decrease our earnings. If we match our competitors' pricing, terms and structure, we may experience decreased net interest income and increased risk of credit loss. As a result of operating in such a competitive environment, we may make investments that are on less favorable terms than what we may have originally anticipated, which may impact our return on these investments.

There are significant potential conflicts of interest that could impact our investment returns.

              Conflicts may arise in allocating and structuring investments, time, services, expenses or resources among the investment activities of Ares funds, Ares, other Ares-affiliated entities and the employees of Ares. Certain of our executive officers and directors, and members of the investment committee of our investment adviser, serve or may serve as officers, directors or principals of other entities and affiliates of our investment adviser and investment funds managed by our investment adviser or its affiliates. Accordingly, they may have obligations to investors in those entities, the fulfillment of which might not be in our or our stockholders' best interests or may require them to devote time to services for other entities, which could interfere with the time available to provide services to us. Members of our investment adviser's investment committee may have significant responsibilities for other Ares funds. Similarly, although the professional staff of our investment adviser will devote as much time to the management of us as appropriate to enable our investment adviser to perform its duties in accordance with the investment advisory and management agreement, the investment professionals of our investment adviser may have conflicts in allocating their time and services among us, on the one hand, and investment vehicles managed by our investment adviser or one or more of its affiliates, on the other hand. These activities could be viewed as creating a conflict of interest insofar as the time and effort of the professional staff of our investment adviser and its officers and employees will not be devoted exclusively to our business but will instead be allocated between our business and the management of these other investment vehicles.

              In addition, certain Ares funds may have investment objectives that compete or overlap with, and may from time to time invest in asset classes similar to those targeted by, Ares Capital. Consequently, we, on the one hand, and these other entities, on the other hand, may from time to time pursue the same or similar capital and investment opportunities. Ares and our investment adviser endeavor to allocate investment opportunities in a fair and equitable manner, and in any event consistent with any fiduciary duties owed to Ares Capital. Nevertheless, it is possible that we may not be given the opportunity to participate in certain investments made by investment funds managed by investment managers affiliated with Ares (including our investment adviser). In addition, there may be conflicts in the allocation of investments among us and the funds managed by investment managers affiliated with Ares (including our investment adviser) or one or more of our controlled affiliates or

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among the funds they manage, including investments made pursuant to the Co-investment Exemptive Order. Further, such other Ares-managed funds may hold positions in portfolio companies in which Ares Capital has also invested. Such investments may raise potential conflicts of interest between Ares Capital and such other Ares-managed funds, particularly if Ares Capital and such other Ares-managed funds invest in different classes or types of securities or investments of the same underlying portfolio company. In that regard, actions may be taken by such other Ares-managed funds that are adverse to Ares Capital's interests, including, but not limited to, during a restructuring, bankruptcy or other insolvency proceeding or similar matter occurring at the underlying portfolio company.

              We have from time to time sold assets to IHAM and certain of the IHAM Vehicles and, as part of our investment strategy, we may offer to sell additional assets to vehicles managed by one or more of our affiliates (including IHAM) or we may purchase assets from vehicles managed by one or more of our affiliates (including IHAM). In addition, vehicles managed by one or more of our affiliates (including IHAM) may offer assets to or may purchase assets from one another. While assets may be sold or purchased at prices that are consistent with those that could be obtained from third parties in the marketplace, and although these types of transactions generally require approval of one or more independent parties, there may be an inherent conflict of interest in such transactions between us and funds managed by one of our affiliates (including our investment adviser).

              We pay a base management fee, an income based fee and a capital gains incentive fee to our investment adviser, and reimburse our investment adviser for certain expenses it incurs. Ares, from time to time, incurs fees, costs, and expenses on behalf of more than one fund. To the extent such fees, costs, and expenses are incurred for the account or benefit of more than one fund, each such fund will typically bear an allocable portion of any such fees, costs, and expenses in proportion to the size of its investment in the activity or entity to which such expense relates (subject to the terms of each fund's governing documents) or in such other manner as Ares considers fair and equitable under the circumstances such as the relative fund size or capital available to be invested by such funds. Where a fund's governing documents do not permit the payment of a particular expense, Ares will generally pay such fund's allocable portion of such expense. In addition, investors in our common stock will invest on a gross basis and receive distributions on a net basis after expenses, resulting in, among other things, a lower rate of return than one might achieve if distributions were made on a gross basis.

              Our investment adviser's base management fee is based on a percentage of our total assets (other than cash or cash equivalents but including assets purchased with borrowed funds) and, consequently, our investment adviser may have conflicts of interest in connection with decisions that could affect our total assets, such as decisions as to whether to incur indebtedness or to make future investments. We are currently allowed to borrow amounts such that our asset coverage, as calculated pursuant to the Investment Company Act, equals at least 200% after such borrowing. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). Accordingly, our investment adviser may have conflicts of interest in connection with decisions to use increased leverage permitted under our modified asset coverage requirement applicable to senior securities, as the incurrence of such additional indebtedness would result in an increase in the base management fees payable to our investment adviser and may also result in an increase in the income based fees and capital gains incentive fees payable to our investment adviser.

              The income based fees payable by us to our investment adviser that relate to our pre-incentive fee net investment income is computed and paid on income that may include interest that is accrued but not yet received in cash. If a portfolio company defaults on a loan that is structured to provide accrued interest, it is possible that accrued interest previously used in the calculation of such fee will

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become uncollectible. Our investment adviser is not under any obligation to reimburse us for any part of the income based fees it received that were based on accrued interest that we never actually receive.

              Our investment advisory and management agreement renews for successive annual periods if approved by our board of directors or by the affirmative vote of the holders of a majority of our outstanding voting securities, including, in either case, approval by a majority of our directors who are not "interested persons" of us as defined in Section 2(a)(19) of the Investment Company Act. However, both we and our investment adviser have the right to terminate the agreement without penalty upon 60 days' written notice to the other party. Moreover, conflicts of interest may arise if our investment adviser seeks to change the terms of our investment advisory and management agreement, including, for example, the terms for compensation to our investment adviser. While any material change to the investment advisory and management agreement must be submitted to stockholders for approval under the Investment Company Act, we may from time to time decide it is appropriate to seek stockholder approval to change the terms of the agreement.

              We are party to an administration agreement with our administrator, Ares Operations, a subsidiary of Ares Management, pursuant to which our administrator furnishes us with administrative services and we pay our administrator at cost our allocable portion of overhead and other expenses (including travel expenses) incurred by our administrator in performing its obligations under our administration agreement, including our allocable portion of the compensation, rent, and other expenses of certain of our officers (including our chief compliance officer, chief financial officer, chief accounting officer, general counsel, secretary, treasurer and assistant treasurer) and their respective staffs, but not investment professionals.

              Our portfolio company, IHAM, is party to an administration agreement, referred to herein as the "IHAM administration agreement," with Ares Operations. Pursuant to the IHAM administration agreement, our administrator provides IHAM with administrative services and IHAM reimburses our administrator for all of the actual costs associated with such services, including its allocable portion of our administrator's overhead and the cost of our administrator's officers and respective staff in performing its obligations under the IHAM administration agreement. Prior to entering into the IHAM administration agreement, IHAM was party to a services agreement with our investment adviser, pursuant to which our investment adviser provided similar services.

              As a result of the arrangements described above, there may be times when the management team of Ares Management (including those members of management focused primarily on managing Ares Capital) has interests that differ from those of yours, giving rise to a conflict.

              Our stockholders may have conflicting investment, tax and other objectives with respect to their investments in us. The conflicting interests of individual stockholders may relate to or arise from, among other things, the nature of our investments, the structure or the acquisition of our investments, and the timing of dispositions of our investments. As a consequence, conflicts of interest may arise in connection with decisions made by our investment adviser, including with respect to the nature or structuring of our investments, that may be more beneficial for one stockholder than for another stockholder, especially with respect to stockholders' individual tax situations. In selecting and structuring investments appropriate for us, our investment adviser will consider the investment and tax objectives of the Company and our stockholders, as a whole, not the investment, tax or other objectives of any stockholder individually.

We may be subject to additional corporate-level income taxes if we fail to maintain our status as a RIC.

              We have elected to be treated as a RIC under the Code and operate in a manner so as to qualify for the U.S. federal income tax treatment applicable to RICs. As a RIC, we generally will not pay U.S. federal corporate-level income taxes on our income and net capital gains that we distribute to our stockholders as dividends on a timely basis. We will be subject to U.S. federal corporate-level income tax on any undistributed income and/or gains. To maintain our status as a RIC, we must meet certain source of income, asset diversification and annual distribution requirements. We may also be subject to certain U.S. federal excise taxes, as well as state, local and foreign taxes.

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              To maintain our RIC status, we must timely distribute an amount equal to at least 90% of our investment company taxable income (as defined by the Code, which generally includes net ordinary income and net short term capital gains) to our stockholders (the "Annual Distribution Requirement"). We have the ability to pay a large portion of our dividends in shares of our stock, and as long as a portion of such dividend is paid in cash and other requirements are met, such stock dividends will be taxable as a dividend for U.S. federal income tax purposes. This may result in our U.S. stockholders having to pay tax on such dividends, even if no cash is received, and may result in our non-U.S. stockholders being subject to withholding tax in respect of amounts distributed in our stock. Because we use debt financing, we are subject to certain asset coverage ratio requirements under the Investment Company Act and financial covenants under our indebtedness that could, under certain circumstances, restrict us from making distributions necessary to qualify as a RIC. If we are unable to obtain cash from other sources, we may fail to maintain our status as a RIC and, thus, may be subject to corporate-level income tax on all of our income and/or gains.

              To maintain our status as a RIC, in addition to the Annual Distribution Requirement, we must also meet certain annual source of income requirements at the end of each taxable year and asset diversification requirements at the end of each calendar quarter. Failure to meet these requirements may result in our having to (a) dispose of certain investments quickly or (b) raise additional capital to prevent the loss of RIC status. Because most of our investments are in private companies and are generally illiquid, any such dispositions may be at disadvantageous prices and may result in losses. Also, the rules applicable to our qualification as a RIC are complex with many areas of uncertainty. Accordingly, no assurance can be given that we have qualified or will continue to qualify as a RIC. If we fail to maintain our status as a RIC for any reason and become subject to regular "C" corporation income tax, the resulting corporate-level income taxes could substantially reduce our net assets, the amount of income available for distribution and the amount of our distributions. Such a failure would have a material adverse effect on us and on any investment in us. Certain provisions of the Code provide some relief from RIC disqualification due to failures of the source of income and asset diversification requirements, although there may be additional taxes due in such cases. We cannot assure you that we would qualify for any such relief should we fail the source of income or asset diversification requirements.

We may have difficulty paying our required distributions under applicable tax rules if we recognize income before or without receiving cash representing such income.

              For U.S. federal income tax purposes, we generally are required to include in income certain amounts that we have not yet received in cash, such as original issue discount, which may arise, for example, if we receive warrants in connection with the making of a loan, or payment in kind ("PIK") interest representing contractual interest added to the loan principal balance and due at the end of the loan term. Such original issue discount or PIK interest is included in income before we receive any corresponding cash payments. We also may be required to include in income certain other amounts that we will not receive in cash, including, for example, amounts attributable to hedging and foreign currency transactions.

              Since, in certain cases, we may recognize income before or without receiving cash in respect of such income, we may have difficulty meeting the U.S. federal income tax requirement to distribute generally an amount equal to at least 90% of our investment company taxable income to maintain our status as a RIC. Accordingly, we may have to sell some of our investments at times we would not consider advantageous, raise additional debt or equity capital or reduce new investment originations to meet these distribution requirements. If we are not able to obtain cash from other sources, we may fail to qualify as a RIC and thus be subject to additional corporate-level income taxes. Such a failure could have a material adverse effect on us and on any investment in us. See "Certain Material U.S. Federal Income Tax Considerations—Taxation as a RIC."

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We are exposed to risks associated with changes in interest rates.

              General interest rate fluctuations may have a substantial negative impact on our investments and investment opportunities and, accordingly, may have a material adverse effect on our investment objective and rate of return on invested capital. Because we borrow money and may issue debt securities or preferred stock to make investments, our net investment income is dependent upon the difference between the rate at which we borrow funds or pay interest or dividends on such debt securities or preferred stock and the rate at which we invest these funds. From time to time, we may also enter into certain hedging transactions to mitigate our exposure to rising borrowing costs.

              In the past, we have entered into certain hedging transactions, such as interest rate swap agreements, to mitigate our exposure to adverse fluctuations in interest rates, and we may do so again in the future. In addition, we may increase our floating rate investments to position the portfolio for rate increases. However, we cannot assure you that such transactions will be successful in mitigating our exposure to interest rate risk. Hedging transactions may also limit our ability to participate in the benefits of lower interest rates with respect to our indebtedness. There can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income.

              Trading prices tend to fluctuate more for fixed-rate securities that have longer maturities. Although we have no policy governing the maturities of our investments, under current market conditions we expect that we will invest in a portfolio of debt generally having maturities of up to 10 years. Trading prices for debt that pays a fixed rate of return tend to fall as interest rates rise. This means that we are subject to greater risk (other things being equal) than a fund invested solely in shorter-term securities. A decline in the prices of the debt we own could adversely affect the trading price of our common stock. Also, an increase in interest rates available to investors could make an investment in our common stock less attractive if we are not able to increase our dividend rate, which could reduce the value of our common stock.

Most of our portfolio investments are not publicly traded and, as a result, the fair value of these investments may not be readily determinable.

              A large percentage of our portfolio investments are not publicly traded. The fair value of investments that are not publicly traded may not be readily determinable. We value these investments quarterly at fair value as determined in good faith by our board of directors based on, among other things, the input of our management and audit committee and independent valuation firms that have been engaged at the direction of our board of directors to assist in the valuation of each portfolio investment without a readily available market quotation at least once during a trailing 12-month period (with certain de minimis exceptions). The valuation process is conducted at the end of each fiscal quarter, with a portion (based on value) of our valuations of portfolio companies without readily available market quotations subject to review by an independent valuation firm each quarter. However, we may use these independent valuation firms to review the value of our investments more frequently, including in connection with the occurrence of significant events or changes in value affecting a particular investment. In addition, our independent registered public accounting firm obtains an understanding of, and performs select procedures relating to, our investment valuation process within the context of performing the integrated audit.

              The types of factors that may be considered in valuing our investments include the enterprise value of the portfolio company (the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time), the nature and realizable value of any collateral, the portfolio company's ability to make payments and its earnings and discounted cash flows, the markets in which the portfolio company does business, a comparison of the portfolio company's securities to similar publicly traded securities,

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changes in the interest rate environment and the credit markets generally that may affect the price at which similar investments would trade in their principal markets and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate our valuation. Because such valuations, and particularly valuations of private investments and private companies, are inherently uncertain, may fluctuate over short periods of time and may be based on estimates, our determinations of fair value may differ materially from the values that would have been used if a ready market for these investments existed and may differ materially from the values that we may ultimately realize. Our net asset value per share could be adversely affected if our determinations regarding the fair value of these investments are higher than the values that we realize upon disposition of such investments.

The lack of liquidity in our investments may adversely affect our business.

              As we generally make investments in private companies, substantially all of these investments are subject to legal and other restrictions on resale or are otherwise less liquid than publicly traded securities. The illiquidity of our investments may make it difficult for us to sell such investments if the need arises. In addition, if we are required to liquidate all or a portion of our portfolio quickly, we could realize significantly less than the value at which we have recorded our investments or could be unable to dispose of our investments in a timely manner. In addition, we may face other restrictions on our ability to liquidate an investment in a portfolio company to the extent that we or an affiliated manager of Ares has material non-public information regarding such portfolio company.

We may experience fluctuations in our quarterly results.

              We could experience fluctuations in our quarterly operating results due to a number of factors, including the interest rates payable on the debt investments we make, the default rates on such investments, the level of our expenses, variations in and the timing of the recognition of realized and unrealized gains or losses, the degree to which we encounter competition in our markets and general economic conditions. As a result of these factors, results for any period should not be relied upon as being indicative of performance in future periods.

Our financial condition and results of operations could be negatively affected if a significant investment fails to perform as expected.

              Our investment portfolio includes investments that may be significant individually or in the aggregate. If a significant investment in one or more companies fails to perform as expected, such a failure could have a material adverse effect on our business, financial condition and operating results, and the magnitude of such effect could be more significant than if we had further diversified our portfolio.

We are dependent on information systems and systems failures could significantly disrupt our business, which may, in turn, negatively affect our liquidity, financial condition or results of operations.

              Our business is dependent on our and third parties' communications and information systems. Further, in the ordinary course of our business we or our investment adviser may engage certain third party service providers to provide us with services necessary for our business. Any failure or interruption of those systems or services, including as a result of the termination or suspension of an agreement with any third-party service providers, could cause delays or other problems in our business activities. Our financial, accounting, data processing, backup or other operating systems and facilities may fail to operate properly or become disabled or damaged as a result of a number of factors

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including events that are wholly or partially beyond our control and adversely affect our business. There could be:

    sudden electrical or telecommunications outages;

    natural disasters such as earthquakes, tornadoes and hurricanes;

    disease pandemics;

    events arising from local or larger scale political or social matters, including terrorist acts; and

    cyber-attacks.

              These events, in turn, could have a material adverse effect on our business, financial condition and operating results and negatively affect the market price of our common stock and our ability to pay dividends to our stockholders.

Cybersecurity risks and cyber incidents may adversely affect our business or the business of our portfolio companies by causing a disruption to our operations or the operations of our portfolio companies, a compromise or corruption of our confidential information or the confidential information of our portfolio companies and/or damage to our business relationships or the business relationships of our portfolio companies, all of which could negatively impact the business, financial condition and operating results of us or our portfolio companies.

              A cyber incident is considered to be any adverse event that threatens the confidentiality, integrity or availability of the information resources of us or our portfolio companies. These incidents may be an intentional attack or an unintentional event and could involve gaining unauthorized access to our information systems or those of our portfolio companies for purposes of misappropriating assets, stealing confidential information, corrupting data or causing operational disruption. We and our investment adviser's employees have been and expect to continue to be the target of fraudulent calls, emails and other forms of activities. The result of these incidents may include disrupted operations, misstated or unreliable financial data, liability for stolen assets or information, increased cybersecurity protection and insurance costs, litigation and damage to business relationships. The costs related to cyber or other security threats or disruptions may not be fully insured or indemnified by other means. As our and our portfolio companies' reliance on technology has increased, so have the risks posed to our information systems, both internal and those provided by Ares Management and third-party service providers, and the information systems of our portfolio companies. Ares Management has implemented processes, procedures and internal controls to help mitigate cybersecurity risks and cyber intrusions, but these measures, as well as our increased awareness of the nature and extent of a risk of a cyber incident, do not guarantee that a cyber incident will not occur and/or that our financial results, operations or confidential information will not be negatively impacted by such an incident. In addition, cybersecurity has become a top priority for regulators around the world, and some jurisdictions have enacted laws requiring companies to notify individuals of data security breaches involving certain types of personal data. If we fail to comply with the relevant laws and regulations, we could suffer financial losses, a disruption of our business, liability to investors, regulatory intervention or reputational damage.

Ineffective internal controls could impact our business and operating results.

              Our internal control over financial reporting may not prevent or detect misstatements because of its inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud. Even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements. If we fail to maintain the adequacy of our internal controls, including any failure to implement required new or improved controls, or if we

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experience difficulties in their implementation, our business and operating results could be harmed and we could fail to meet our financial reporting obligations.

Changes in laws or regulations governing our operations or the operations of our portfolio companies, changes in the interpretation thereof or newly enacted laws or regulations, such as the Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), Public Law No. 115-97 (the "Tax Cuts and Jobs Act") and the SBCAA, could require changes to certain business practices of us or our portfolio companies, negatively impact the operations, cash flows or financial condition of us or our portfolio companies, impose additional costs on us or our portfolio companies or otherwise adversely affect our business or the business of our portfolio companies.

              We and our portfolio companies are subject to regulation by laws and regulations at the local, state, federal and, in some cases, foreign levels. These laws and regulations, as well as their interpretation, may be changed from time to time, and new laws and regulations may be enacted. Accordingly, any change in these laws or regulations, changes in their interpretation, or newly enacted laws or regulations could require changes to certain business practices of us or our portfolio companies, negatively impact the operations, cash flows or financial condition of us or our portfolio companies, impose additional costs on us or our portfolio companies or otherwise adversely affect our business or the business of our portfolio companies.

              On July 21, 2010, President Obama signed into law the Dodd-Frank Act. Many of the provisions of the Dodd-Frank Act have had extended implementation periods and delayed effective dates and have required extensive rulemaking by regulatory authorities. While many of the rules required to be written have been promulgated, some have not yet been implemented. Although the full impact of the Dodd-Frank Act on us and our portfolio companies may not be known for an extended period of time, the Dodd-Frank Act, including the rules implementing its provisions and the interpretation of those rules relating to capital, margin, trading and clearance and settlement of derivatives, may negatively impact the operations, cash flows or financial condition of us or our portfolio companies, impose additional costs on us or our portfolio companies, intensify the regulatory supervision of us or our portfolio companies or otherwise adversely affect our business or the business of our portfolio companies.

              On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act, which significantly changed the Code, including, a reduction in the corporate income tax rate, a new limitation on the deductibility of interest expense, and significant changes to the taxation of income earned from foreign sources and foreign subsidiaries. The Tax Cuts and Jobs Act also authorizes the IRS to issue regulations with respect to the new provisions. We cannot predict how the changes in the Tax Cuts and Jobs Act, or regulations or other guidance issued under it, might affect us, our business or the business of our portfolio companies.

              On February 3, 2017, President Trump signed Executive Order 13772 announcing the new Administration's policy to regulate the U.S. financial system in a manner consistent with certain "Core Principles," including regulation that is efficient, effective and appropriately tailored. The Executive Order directed the Secretary of the Treasury, in consultation with the heads of the member agencies of the Financial Stability Oversight Council, to report to the President on the extent to which existing laws, regulations and other government policies promote the Core Principles and to identify any laws, regulations or other government policies that inhibit federal regulation of the U.S. financial system. On June 12, 2017, the U.S. Department of the Treasury published the first of several reports in response to the Executive Order on the depository system covering banks and other savings institutions. On October 6, 2017, the Treasury released a second report outlining ways to streamline and reform the U.S. regulatory system for capital markets, followed by a third report, on October 26, 2017, examining the current regulatory framework for the asset management and insurance industries. The Treasury released a fourth report on July 31, 2018 describing recommendations relating to non-bank financial

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institutions, financial technology and innovation. Subsequent reports are expected to address retail and institutional investment products and vehicles.

              On May 24, 2018, President Trump signed into law the Economic Growth, Regulatory Relief, and Consumer Protection Act, which increased from $50 billion to $250 billion the asset threshold for designation of "systemically important financial institutions" or "SIFIs" subject to enhanced prudential standards set by the Federal Reserve, staggering application of this change based on the size and risk of the covered bank holding company. On May 30th, the Federal Reserve voted to consider changes to the Volcker Rule that would loosen compliance requirements for all banks. On July 17, 2018, the House of Representatives passed the JOBS and Investor Confidence Act, which includes 32 pieces of legislation intended to help small businesses, entrepreneurs and investors by reforming capital markets. The proposed legislation includes provisions to expand the definition of "accredited investors," extend on-ramp exemptions for emerging growth companies (EGCs) and ease securities regulations on initial public offerings. The legislation was forwarded to the Senate for consideration, where no further action was taken, although it may be reintroduced in the future. At this time it is not possible to determine the potential impact of these new laws and proposals on us.

              On March 23, 2018, the SBCAA was signed into law. The SBCAA, among other things, modifies the applicable provisions of the Investment Company Act to reduce the required asset coverage ratio applicable to a BDC from 200% to 150% subject to certain approval, time and disclosure requirements (including either stockholder approval or approval of a "required majority" of its board of directors). On June 21, 2018, our board of directors, including a "required majority" of our board of directors, approved the application of the modified asset coverage requirement set forth in Section 61(a)(2) of the Investment Company Act, as amended by the SBCAA. As a result, effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us), and the risks associated with an investment in us may increase.

Changes to United States tariff and import/export regulations may have a negative effect on our portfolio companies and, in turn, harm us.

              There has been ongoing discussion and commentary regarding potential significant changes to United States trade policies, treaties and tariffs. The current administration, along with Congress, has created significant uncertainty about the future relationship between the United States and other countries with respect to such trade policies, treaties and tariffs. These developments, or the perception that any of them could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between the impacted nations and the United States. Any of these factors could depress economic activity and restrict our portfolio companies' access to suppliers or customers and have a material adverse effect on their business, financial condition and results of operations, which in turn would negatively impact us.

Uncertainty relating to the LIBOR calculation process may adversely affect the value of our portfolio of the LIBOR-indexed, floating-rate debt securities in our portfolio or the cost of our borrowings.

              Concerns have been publicized that some of the member banks surveyed by the British Bankers' Association ("BBA") in connection with the calculation of LIBOR across a range of maturities and currencies may have been under-reporting or otherwise manipulating the inter-bank lending rate applicable to them in order to profit on their derivatives positions or to avoid an appearance of capital insufficiency or adverse reputational or other consequences that may have resulted from reporting inter-bank lending rates higher than those they actually submitted. A number

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of BBA member banks have entered into settlements with their regulators and law enforcement agencies with respect to alleged manipulation of LIBOR, and investigations by regulators and governmental authorities in various jurisdictions are ongoing.

              On July 27, 2017, the United Kingdom's Financial Conduct Authority, which regulates LIBOR, announced that it intends to phase out LIBOR by the end of 2021. It is unclear if at that time whether or not LIBOR will cease to exist or if new methods of calculating LIBOR will be established such that it continues to exist after 2021. The U.S. Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, is considering replacing U.S. dollar LIBOR with a new index calculated by short-term repurchase agreements, backed by Treasury securities. The future of LIBOR at this time is uncertain. Potential changes, or uncertainty related to such potential changes, may adversely affect the market for LIBOR-based securities, including our portfolio of LIBOR-indexed, floating-rate debt securities, or the cost of our borrowings. In addition, changes or reforms to the determination or supervision of LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR, which could have an adverse impact on the market for LIBOR-based securities, including the value of the LIBOR-indexed, floating-rate debt securities in our portfolio, or the cost of our borrowings. Additionally, if LIBOR ceases to exist, we may need to renegotiate the credit agreements extending beyond 2021 with our portfolio companies that utilize LIBOR as a factor in determining the interest rate and certain of our existing credit facilities to replace LIBOR with the new standard that is established.

Our investment adviser's liability is limited under the investment advisory and management agreement, and we are required to indemnify our investment adviser against certain liabilities, which may lead our investment adviser to act in a riskier manner on our behalf than it would when acting for its own account.

              Our investment adviser has not assumed any responsibility to us other than to render the services described in the investment advisory and management agreement, and it will not be responsible for any action of our board of directors in declining to follow our investment adviser's advice or recommendations. Pursuant to the investment advisory and management agreement, our investment adviser and its members and their respective officers, managers, partners, agents, employees, controlling persons and members and any other persons affiliated with it will not be liable to us for their acts under the investment advisory and management agreement, absent willful misfeasance, bad faith, gross negligence or reckless disregard in the performance of their duties. We have agreed to indemnify, defend and protect our investment adviser and its members and their respective officers, managers, partners, agents, employees, controlling persons and members and any other persons or entities affiliated with it with respect to all damages, liabilities, costs and expenses arising out of or otherwise based upon the performance of any of our investment adviser's duties or obligations under the investment advisory and management agreement or otherwise as an investment adviser for us, and not arising out of willful misfeasance, bad faith, gross negligence or reckless disregard in the performance of their duties under the investment advisory and management agreement. These protections may lead our investment adviser to act in a riskier manner when acting on our behalf than it would when acting for its own account. See "Risk Factors—Risks Relating to Our Investments—Our investment adviser's fee structure may induce it to make certain investments on our behalf, including speculative investments."

We may be obligated to pay our investment adviser certain fees even if we incur a loss.

              Our investment adviser is entitled to income based fees for each fiscal quarter in an amount equal to a percentage of the excess of our pre-incentive fee net investment income for that quarter (before deducting any income based fee and capital gains incentive fees and certain other items) above a threshold return for that quarter. Our pre-incentive fee net investment income for income based fee

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purposes excludes realized and unrealized capital losses or depreciation and income taxes related to realized gains that we may incur in the fiscal quarter, even if such capital losses or depreciation and income taxes related to realized gains result in a net loss on our statement of operations for that quarter. Thus, we may be required to pay our investment adviser income based fees for a fiscal quarter even if there is a decline in the value of our portfolio or the net asset value of our common stock or we incur a net loss for that quarter.

              Under the investment advisory and management agreement, we will defer cash payment of any income based fee and the capital gains incentive fee otherwise earned by our investment adviser if, during the most recent four full calendar quarter periods ending on or prior to the date such payment is to be made, the sum of (a) our aggregate distributions to our stockholders and (b) our change in net assets (defined as total assets less indebtedness and before taking into account any income based fees or capital gains incentive fees accrued during the period) is less than 7.0% of our net assets (defined as total assets less indebtedness) at the beginning of such period. These calculations will be adjusted for any share issuances or repurchases. Any such deferred fees will be carried over for payment in subsequent calculation periods to the extent such payment can then be made under the investment advisory and management agreement.

              If a portfolio company defaults on a loan that is structured to provide interest, it is possible that accrued and unpaid interest previously used in the calculation of income based fees will become uncollectible. Our investment adviser is not under any obligation to reimburse us for any part of income based fees it received that was based on accrued income that we never receive.

RISKS RELATING TO OUR INVESTMENTS

Declines in market prices and liquidity in the corporate debt markets can result in significant net unrealized depreciation of our portfolio, which in turn would reduce our net asset value.

              As a BDC, we are required to carry our investments at market value or, if no market value is ascertainable, at fair value as determined in good faith by or under the direction of our board of directors. We may take into account the following types of factors, if relevant, in determining the fair value of our investments: the enterprise value of a portfolio company (the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time), the nature and realizable value of any collateral, the portfolio company's ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company's securities to similar publicly traded securities, changes in the interest rate environment and the credit markets generally that may affect the price at which similar investments would trade in their principal markets and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we use the pricing indicated by the external event to corroborate our valuation. While most of our investments are not publicly traded, applicable accounting standards require us to assume as part of our valuation process that our investments are sold in a principal market to market participants (even if we plan on holding an investment through its maturity). As a result, volatility in the capital markets can also adversely affect our investment valuations. Decreases in the market values or fair values of our investments are recorded as unrealized depreciation. The effect of all of these factors on our portfolio can reduce our net asset value (and, as a result our asset coverage calculation) by increasing net unrealized depreciation in our portfolio. Depending on market conditions, we could incur substantial realized and/or unrealized losses, which could have a material adverse effect on our business, financial condition or results of operations.

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Economic recessions or downturns could impair our portfolio companies and harm our operating results.

              Many of our portfolio companies may be susceptible to economic downturns or recessions and may be unable to repay our loans during these periods. Therefore, during these periods our non-performing assets may increase and the value of our portfolio may decrease if we are required to write down the values of our investments. Adverse economic conditions may also decrease the value of collateral securing some of our loans and the value of our equity investments. Economic slowdowns or recessions could lead to financial losses in our portfolio and a decrease in revenues, net income and assets. Unfavorable economic conditions also could increase our funding costs, limit our access to the capital markets or result in a decision by lenders not to extend credit to us. These events could prevent us from increasing investments and harm our operating results. We experienced to some extent such effects as a result of the economic downturn that occurred from 2008 through 2009 and may experience such effects again in any future downturn or recession.

              A portfolio company's failure to satisfy financial or operating covenants imposed by us or other lenders could lead to defaults and, potentially, acceleration of the time when the loans are due and foreclosure on its assets representing collateral for its obligations, which could trigger cross defaults under other agreements and jeopardize our portfolio company's ability to meet its obligations under the debt investments that we hold and the value of any equity securities we own. We may incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with a defaulting portfolio company.

Investments in privately held middle-market companies involve significant risks.

              We primarily invest in privately held U.S. middle-market companies. Investments in privately held middle-market companies involve a number of significant risks, including the following:

    these companies may have limited financial resources and may be unable to meet their obligations, which may be accompanied by a deterioration in the value of any collateral and a reduction in the likelihood of us realizing our investment;

    they typically have shorter operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render them more vulnerable to competitors' actions and market conditions, as well as general economic downturns;

    they typically depend on the management talents and efforts of a small group of persons; therefore, the death, disability, resignation or termination of one or more of these persons could have a material adverse effect on such portfolio company and, in turn, on us;

    there is generally little public information about these companies. These companies and their financial information are generally not subject to the Exchange Act (as defined below) and other regulations that govern public companies, and we may be unable to uncover all material information about these companies, which may prevent us from making a fully informed investment decision and cause us to lose money on our investments;

    they generally have less predictable operating results and may require substantial additional capital to support their operations, finance expansion or maintain their competitive position;

    we, our executive officers, directors and our investment adviser may, in the ordinary course of business, be named as defendants in litigation arising from our investments in our portfolio companies and may, as a result, incur significant costs and expenses in connection with such litigation;

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    changes in laws and regulations (including the Tax Cuts and Jobs Act), as well as their interpretations, may adversely affect their business, financial structure or prospects; and

    they may have difficulty accessing the capital markets to meet future capital needs.

Our debt investments may be risky and we could lose all or part of our investment.

              The debt that we invest in is typically not initially rated by any rating agency, but we believe that if such investments were rated, they would be below investment grade (rated lower than "Baa3" by Moody's Investors Service, lower than "BBB–" by Fitch Ratings or lower than "BBB–" by Standard & Poor's Ratings Services), which under the guidelines established by these entities is an indication of having predominantly speculative characteristics with respect to the issuer's capacity to pay interest and repay principal. Bonds that are rated below investment grade are sometimes referred to as "high yield bonds" or "junk bonds." Therefore, our investments may result in an above average amount of risk and volatility or loss of principal. While the debt we invest in is often secured, such security does not guarantee that we will receive principal and interest payments according to the terms of the loan, or that the value of any collateral will be sufficient to allow us to recover all or a portion of the outstanding amount of the loan should we be forced to enforce our remedies.

              We also may invest in assets other than first and second lien and mezzanine debt investments, including high-yield securities, U.S. government securities, credit derivatives and other structured securities and certain direct equity investments. These investments entail additional risks that could adversely affect our investment returns.

Investments in equity securities, many of which are illiquid with no readily available market, involve a substantial degree of risk.

              We may purchase common and other equity securities. Although common stock has historically generated higher average total returns than fixed income securities over the long-term, common stock also has experienced significantly more volatility in those returns. The equity securities we acquire may fail to appreciate and may decline in value or become worthless and our ability to recover our investment will depend on the underlying portfolio company's success. Investments in equity securities involve a number of significant risks, including:

    any equity investment we make in a portfolio company could be subject to further dilution as a result of the issuance of additional equity interests and to serious risks as a junior security that will be subordinate to all indebtedness (including trade creditors) or senior securities in the event that the issuer is unable to meet its obligations or becomes subject to a bankruptcy process;

    to the extent that the portfolio company requires additional capital and is unable to obtain it, we may not recover our investment; and

    in some cases, equity securities in which we invest will not pay current dividends, and our ability to realize a return on our investment, as well as to recover our investment, will be dependent on the success of the portfolio company. Even if the portfolio company is successful, our ability to realize the value of our investment may be dependent on the occurrence of a liquidity event, such as a public offering or the sale of the portfolio company. It is likely to take a significant amount of time before a liquidity event occurs or we can otherwise sell our investment. In addition, the equity securities we receive or invest in may be subject to restrictions on resale during periods in which it could be advantageous to sell them.

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              There are special risks associated with investing in preferred securities, including:

    preferred securities may include provisions that permit the issuer, at its discretion, to defer distributions for a stated period without any adverse consequences to the issuer. If we own a preferred security that is deferring its distributions, we may be required to report income for tax purposes before we receive such distributions;

    preferred securities are subordinated to debt in terms of priority to income and liquidation payments, and therefore will be subject to greater credit risk than debt;

    preferred securities may be substantially less liquid than many other securities, such as common stock or U.S. government securities; and

    generally, preferred security holders have no voting rights with respect to the issuing company, subject to limited exceptions.

              Additionally, when we invest in first lien senior secured loans (including unitranche loans), second lien senior secured loans or mezzanine debt, we may acquire warrants or other equity securities as well. Our goal is ultimately to dispose of such equity interests and realize gains upon our disposition of such interests. However, the equity interests we receive may not appreciate in value and, in fact, may decline in value. Accordingly, we may not be able to realize gains from our equity interests and any gains that we do realize on the disposition of any equity interests may not be sufficient to offset any other losses we experience.

              We may invest, to the extent permitted by law, in the equity securities of investment funds that are operating pursuant to certain exceptions to the Investment Company Act and in advisers to similar investment funds and, to the extent we so invest, will bear our ratable share of any such company's expenses, including management and performance fees. We will also remain obligated to pay the base management fee, income based fee and capital gains incentive fee to our investment adviser with respect to the assets invested in the securities and instruments of such companies. With respect to each of these investments, each of our common stockholders will bear his or her share of the base management fee, income based fee and capital gains incentive fee due to our investment adviser as well as indirectly bearing the management and performance fees and other expenses of any such investment funds or advisers.

There may be circumstances in which our debt investments could be subordinated to claims of other creditors or we could be subject to lender liability claims.

              If one of our portfolio companies were to go bankrupt, even though we may have structured our interest as senior debt, depending on the facts and circumstances, a bankruptcy court might recharacterize our debt holding as an equity investment and subordinate all or a portion of our claim to that of other creditors. In addition, lenders can be subject to lender liability claims for actions taken by them where they become too involved in the borrower's business or exercise control over the borrower. For example, we could become subject to a lender's liability claim, if, among other things, we actually render significant managerial assistance.

Our portfolio companies may incur debt or issue equity securities that rank equally with, or senior to, our investments in such companies.

              Our portfolio companies may have, or may be permitted to incur, other debt, or issue other equity securities, that rank equally with, or senior to, our investments. By their terms, such instruments may provide that the holders are entitled to receive payment of dividends, interest or principal on or before the dates on which we are entitled to receive payments in respect of our investments. These debt instruments would usually prohibit the portfolio companies from paying interest on or repaying our investments in the event and during the continuance of a default under such debt. Also, in the

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event of insolvency, liquidation, dissolution, reorganization or bankruptcy of a portfolio company, holders of securities ranking senior to our investment in that portfolio company typically are entitled to receive payment in full before we receive any distribution in respect of our investment. After repaying such holders, the portfolio company may not have any remaining assets to use for repaying its obligation to us. In the case of securities ranking equally with our investments, we would have to share on an equal basis any distributions with other security holders in the event of an insolvency, liquidation, dissolution, reorganization or bankruptcy of the relevant portfolio company.

              The rights we may have with respect to the collateral securing any junior priority loans we make to our portfolio companies may also be limited pursuant to the terms of one or more intercreditor agreements (including agreements governing "first out" and "last out" structures) that we enter into with the holders of senior debt. Under such an intercreditor agreement, at any time that senior obligations are outstanding, we may forfeit certain rights with respect to the collateral to the holders of the senior obligations. These rights may include the right to commence enforcement proceedings against the collateral, the right to control the conduct of such enforcement proceedings, the right to approve amendments to collateral documents, the right to release liens on the collateral and the right to waive past defaults under collateral documents. We may not have the ability to control or direct such actions, even if as a result our rights as junior lenders are adversely affected.

When we are a debt or minority equity investor in a portfolio company, we are often not in a position to exert influence on the entity, and other equity holders and management of the company may make decisions that could decrease the value of our investment in such portfolio company.

              When we make debt or minority equity investments, we are subject to the risk that a portfolio company may make business decisions with which we disagree and the other equity holders and management of such company may take risks or otherwise act in ways that do not serve our interests. As a result, a portfolio company may make decisions that could decrease the value of our investment.

Our portfolio companies may be highly leveraged.

              Some of our portfolio companies may be highly leveraged, which may have adverse consequences to these companies and to us as an investor. These companies may be subject to restrictive financial and operating covenants and the leverage may impair these companies' ability to finance their future operations and capital needs. As a result, these companies' flexibility to respond to changing business and economic conditions and to take advantage of business opportunities may be limited. Further, a leveraged company's income and net assets will tend to increase or decrease at a greater rate than if borrowed money were not used.

Our investment adviser's fee structure may induce it to make certain investments on our behalf, including speculative investments.

              The fees payable by us to our investment adviser may create an incentive for our investment adviser to make investments on our behalf that are risky or more speculative than would be the case in the absence of such compensation arrangement. The way in which income based fees payable to our investment adviser are determined, which are calculated as a percentage of the return on invested capital, may encourage our investment adviser to use leverage to increase the return on our investments. Under certain circumstances, the use of leverage may increase the likelihood of default, which would disfavor the holders of our common stock and the holders of securities convertible into our common stock. In addition, our investment adviser will receive the capital gains incentive fee based, in part, upon net capital gains realized on our investments. Unlike income based fees, there is no hurdle rate applicable to the capital gains incentive fee. As a result, our investment adviser may have a tendency to invest more in investments that are likely to result in capital gains as compared to income producing securities. Such a practice could result in our investing in more speculative securities than would otherwise be the case, which could result in higher investment losses, particularly during economic downturns.

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              The income based fees are computed and paid on income that has been accrued but not yet received in cash, including as a result of investments with a deferred interest feature such as debt instruments with PIK interest, preferred stock with PIK dividends and zero coupon securities. If a portfolio company defaults on a loan that is structured to provide accrued interest, it is possible that accrued interest previously used in the calculation of the income based fee will become uncollectible. Our investment adviser is not under any obligation to reimburse us for any part of the fees it received that were based on such accrued interest that we never actually received.

              Because of the structure of the income based fees, it is possible that we may have to pay income based fees in a quarter during which we incur a loss. For example, if we receive pre-incentive fee net investment income in excess of the hurdle rate for a quarter, we will pay the applicable income based fees even if we have incurred a loss in that quarter due to realized and/or unrealized capital losses. In addition, if market interest rates rise, our investment adviser may be able to invest our funds in debt instruments that provide for a higher return, which would increase our pre-incentive fee net investment income and make it easier for our investment adviser to surpass the fixed hurdle rate and receive income based fees. Additionally, the Fee Waiver is scheduled to end following the third quarter of 2019. Once the Fee Waiver has expired, the income based fees we pay to our investment adviser will effectively be higher.

Our investments in foreign companies may involve significant risks in addition to the risks inherent in U.S. investments.

              Our investment strategy contemplates potential investments in foreign companies. Investing in foreign companies may expose us to additional risks not typically associated with investing in U.S. companies. These risks include changes in exchange control regulations, political and social instability, expropriation, imposition of foreign taxes (potentially at confiscatory levels), less liquid markets, less available information than is generally the case in the United States, higher transaction costs, less government supervision of exchanges, brokers and issuers, less developed bankruptcy laws, difficulty in enforcing contractual obligations, lack of uniform accounting and auditing standards and greater price volatility.

              Although we expect most of our investments will be U.S. dollar denominated, our investments that are denominated in a foreign currency will be subject to the risk that the value of a particular currency will change in relation to one or more other currencies. Among the factors that may affect currency values are trade balances, the level of short-term interest rates, differences in relative values of similar assets in different currencies, long-term opportunities for investment and capital appreciation and political developments. We may employ hedging techniques to minimize these risks, but we cannot assure you that such strategies will be effective or without risk to us.

We may expose ourselves to risks if we engage in hedging transactions.

              We have and may in the future enter into hedging transactions, which may expose us to risks associated with such transactions. We may utilize instruments such as forward contracts, currency options and interest rate swaps, caps, collars and floors to seek to hedge against fluctuations in the relative values of our portfolio positions from changes in currency exchange rates and market interest rates. Use of these hedging instruments may include counter-party credit risk.

              Hedging against a decline in the values of our portfolio positions does not eliminate the possibility of fluctuations in the values of such positions or prevent losses if the values of such positions decline. However, such hedging can establish other positions designed to gain from those same developments, thereby offsetting the decline in the value of such portfolio positions. Such hedging transactions may also limit the opportunity for gain if the values of the underlying portfolio positions should increase. Moreover, it may not be possible to hedge against an exchange rate or interest rate

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fluctuation that is so generally anticipated that we are not able to enter into a hedging transaction at an acceptable price.

              The success of our hedging transactions will depend on our ability to correctly predict movements in currencies and interest rates. Therefore, while we may enter into such transactions to seek to reduce currency exchange rate and interest rate risks, unanticipated changes in currency exchange rates or interest rates may result in poorer overall investment performance than if we had not engaged in any such hedging transactions. In addition, the degree of correlation between price movements of the instruments used in a hedging strategy and price movements in the portfolio positions being hedged may vary. Moreover, for a variety of reasons, we may not seek to (or be able to) establish a perfect correlation between such hedging instruments and the portfolio holdings being hedged. Any such imperfect correlation may prevent us from achieving the intended hedge and expose us to risk of loss. In addition, it may not be possible to hedge fully or perfectly against currency fluctuations affecting the value of securities denominated in non-U.S. currencies because the value of those securities is likely to fluctuate as a result of factors not related to currency fluctuations. See also "Risk Factors—Risks Relating to Our Business—We are exposed to risks associated with changes in interest rates."

We may initially invest a portion of the net proceeds of offerings pursuant to this prospectus primarily in high-quality short-term investments, which will generate lower rates of return than those expected from the interest generated on first and second lien senior secured loans and mezzanine debt.

              We may initially invest a portion of the net proceeds of offerings pursuant to this prospectus primarily in cash, cash equivalents, U.S. government securities and other high-quality short-term investments. These securities generally earn yields substantially lower than the income that we anticipate receiving once we are fully invested in accordance with our investment objective. As a result, we may not, for a time, be able to achieve our investment objective and/or we may need to, for a time, decrease the amount of any dividend that we may pay to our stockholders to a level that is substantially lower than the level that we expect to pay when the net proceeds of offerings are fully invested in accordance with our investment objective. If we do not realize yields in excess of our expenses, we may incur operating losses and the market price of our shares may decline.

RISKS RELATING TO OFFERINGS PURSUANT TO THIS PROSPECTUS

Our shares of common stock have traded at a discount from net asset value and may do so again, which could limit our ability to raise additional equity capital.

              Shares of closed-end investment companies frequently trade at a market price that is less than the net asset value that is attributable to those shares. This characteristic of closed-end investment companies is separate and distinct from the risk that our net asset value per share may decline. It is not possible to accurately predict whether any shares of our common stock will trade at, above, or below net asset value. In the recent past, the stocks of BDCs as an industry, including at times shares of our common stock, have traded below net asset value and during much of 2009 traded at near historic lows as a result of concerns over liquidity, leverage restrictions and distribution requirements. See "Risk Factors—Risks Relating to Our Business—The capital markets may experience periods of disruption and instability. Such market conditions may materially and adversely affect debt and equity capital markets, which may have a negative impact on our business and operations." When our common stock is trading below its net asset value per share, we will generally not be able to issue additional shares of our common stock at its market price without first obtaining approval for such issuance from our stockholders and our independent directors. Pursuant to approval granted at a special meeting of stockholders held on May 14, 2018, we were permitted to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors. Such stockholder approval expired on

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May 14, 2019. On April 10, 2019, we filed the 2019 Special Meeting Proxy Statement for a special meeting of the stockholders, currently expected to take place on June 10, 2019. The 2019 Special Meeting Proxy Statement sets forth a proposal to be voted upon at the special meeting that, if approved by stockholders, would authorize us to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors, for a twelve-month period expiring on the one-year anniversary of the date of the special meeting.

There is a risk that investors in our common stock may not receive dividends or that our dividends may not grow over time and that investors in our debt securities may not receive all of the interest income to which they are entitled.

              We intend to make distributions on a quarterly basis to our stockholders out of assets legally available for distribution. We cannot assure you that we will achieve investment results that will allow us to make a specified level of cash distributions or year-to-year increases in cash distributions. If we declare a dividend and if more stockholders opt to receive cash distributions rather than participate in our dividend reinvestment plan, we may be forced to sell some of our investments in order to make cash dividend payments.

              In addition, due to the asset coverage test applicable to us as a BDC, we may be limited in our ability to make distributions. Certain of the Facilities may also limit our ability to declare dividends if we default under certain provisions. Further, if we invest a greater amount of assets in non-income producing securities, it could reduce the amount available for distribution and may also inhibit our ability to make required interest payments to holders of our debt, which may cause a default under the terms of our debt agreements. Such a default could materially increase our cost of raising capital, as well as cause us to incur penalties under the terms of our debt agreements. See "Price Range of Common Stock and Distributions."

Provisions of the Maryland General Corporation Law and of our charter and bylaws could deter takeover attempts and have an adverse effect on the price of our common stock.

              The Maryland General Corporation Law (the "MGCL"), our charter and our bylaws contain provisions that may discourage, delay or make more difficult a change in control of Ares Capital or the removal of our directors. We are subject to the Maryland Business Combination Act (the "Business Combination Act"), subject to any applicable requirements of the Investment Company Act. Our board of directors has adopted a resolution exempting from the Business Combination Act any business combination between us and any other person, subject to prior approval of such business combination by our board, including approval by a majority of our disinterested directors. If the resolution exempting business combinations is repealed or our board or disinterested directors do not approve a business combination, the Business Combination Act may discourage third parties from trying to acquire control of us and may increase the difficulty of consummating such an offer. Our bylaws exempt from the Maryland Control Share Acquisition Act (the "Control Share Acquisition Act") acquisitions of our stock by any person. If we amend our bylaws to repeal the exemption from the Control Share Acquisition Act, subject to any applicable requirements of the Investment Company Act, the Control Share Acquisition Act also may make it more difficult for a third party to obtain control of us and may increase the difficulty of consummating such an offer.

              We have also adopted measures that may make it difficult for a third party to obtain control of us, including provisions of our charter classifying our board of directors into three classes serving staggered three-year terms, and provisions of our charter authorizing our board of directors to classify or reclassify shares of our stock into one or more classes or series, to cause the issuance of additional shares of our stock, and to amend our charter from time to time, without stockholder approval, to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any

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class or series that we have authority to issue. These provisions, as well as other provisions of our charter and bylaws, may discourage, delay, defer, make more difficult or prevent a transaction or a change in control that might otherwise be in your best interest.

Our bylaws designate the Circuit Court for Baltimore City, Maryland as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers or other employees.

              Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Circuit Court for Baltimore City, Maryland, or, if that Court does not have jurisdiction, the United States District Court for the District of Maryland, Baltimore Division, will be the sole and exclusive forum for: (i) any derivative action or proceeding brought on our behalf, (ii) any Internal Corporate Claim, as such term is defined in Section 1-101(p) of the MGCL, including, without limitation, (a) any action asserting a claim of breach of any duty owed by any of our directors or officers or other employees to us or to our stockholders or (b) any action asserting a claim against us or any of our directors or officers or other employees arising pursuant to any provision of the MGCL or our charter or bylaws or (iii) any action asserting a claim against us or any of our directors or officers or other employees that is governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring or holding any interest in our shares shall be deemed to have notice of and to have consented and waived any objection to this exclusive forum provision of our bylaws, as the same may be amended from time to time. Our board of directors, without stockholder approval, adopted this exclusive forum provision so that we can respond to such litigation more efficiently, reduce the costs associated with our responses to such litigation, particularly litigation that might otherwise be brought in multiple forums, and make it less likely that plaintiffs' attorneys will be able to employ such litigation to coerce us into otherwise unjustified settlements. However, this exclusive forum provision may limit a stockholder's ability to bring a claim in a judicial forum that such stockholder believes is favorable for disputes with us or our directors, officers or other employees, if any, and may discourage lawsuits against us and our directors, officers or other employees, if any. We believe the risk of a court declining to enforce this exclusive forum provision is remote, as the General Assembly of Maryland has specifically amended the MGCL to authorize the adoption of such provision. However, if a court were to find such provision inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings notwithstanding that the MGCL expressly provides that the charter or bylaws of a Maryland corporation may require that any Internal Corporate Claim be brought only in courts sitting in one or more specified jurisdictions, we may incur additional costs that we do not currently anticipate associated with resolving such matters in other jurisdictions, which could adversely affect our business, financial condition and results of operations.

Investing in our common stock may involve an above average degree of risk.

              The investments we make in accordance with our investment objective may result in a higher amount of risk than alternative investment options and volatility or loss of principal. Our investments in portfolio companies may be highly speculative and aggressive and, therefore, an investment in our securities may not be suitable for someone with lower risk tolerance.

The market price of our common stock may fluctuate significantly.

              The capital and credit markets have experienced periods of extreme volatility and disruption over the past several years. The market price and liquidity of the market for shares of our common

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stock may be significantly affected by numerous factors, some of which are beyond our control and may not be directly related to our operating performance. These factors include:

    significant volatility in the market price and trading volume of securities of publicly traded RICs, BDCs or other companies in our sector, which are not necessarily related to the operating performance of these companies;

    price and volume fluctuations in the overall stock market from time to time;

    the inclusion or exclusion of our common stock from certain indices;

    changes in law, regulatory policies or tax guidelines, or interpretations thereof, particularly with respect to RICs or BDCs;

    loss of our RIC status;

    our ability to manage our capital resources effectively;

    changes in our earnings or variations in our operating results;

    changes in the value of our portfolio of investments;

    any shortfall in investment income or net investment income or any increase in losses from levels expected by investors or securities analysts;

    departure of Ares' key personnel;

    operating performance of companies comparable to us;

    short-selling pressure with respect to shares of our common stock or BDCs generally;

    future sales of our securities convertible into or exchangeable or exercisable for our common stock or the conversion of such securities, including the Convertible Unsecured Notes;

    uncertainty surrounding the strength of the U.S. economy;

    concerns regarding European sovereign debt;

    concerns regarding volatility in the Chinese stock market and Chinese currency;

    uncertainty between the U.S. and other countries with respect to trade policies, treaties, and tariffs;

    general economic trends and other external factors; and

    loss of a major funding source.

              In the past, following periods of volatility in the market price of a company's securities, securities class action litigation has often been brought against that company. If our stock price fluctuates significantly, we may be the target of securities litigation in the future. Securities litigation could result in substantial costs and divert management's attention and resources from our business.

We may in the future determine to issue preferred stock, which could adversely affect the market value of our common stock.

              The issuance of shares of preferred stock with dividend or conversion rights, liquidation preferences or other economic terms favorable to the holders of preferred stock could adversely affect the market price for our common stock by making an investment in the common stock less attractive. In addition, the dividends on any preferred stock we issue must be cumulative. Payment of dividends and repayment of the liquidation preference of preferred stock must take preference over any

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dividends or other payments to our common stockholders, and holders of preferred stock are not subject to any of our expenses or losses and are not entitled to participate in any income or appreciation in excess of their stated preference (other than convertible preferred stock that converts into common stock). In addition, under the Investment Company Act, preferred stock constitutes a "senior security" for purposes of the asset coverage test.

The net asset value per share of our common stock may be diluted if we sell shares of our common stock in one or more offerings at prices below the then current net asset value per share of our common stock or securities to subscribe for or convertible into shares of our common stock.

              At a special meeting of stockholders held on May 14, 2018, subject to certain determinations required to be made by our board of directors, our stockholders approved our ability to sell or otherwise issue shares of our common stock, in an amount not exceeding 25% of our then outstanding common stock, at a price below the then current net asset value per share during a period that began on May 14, 2018 and expired on May 14, 2019. On April 10, 2019, we filed the 2019 Special Meeting Proxy Statement for a special meeting of the stockholders, currently expected to take place on June 10, 2019. The 2019 Special Meeting Proxy Statement sets forth a proposal to be voted upon at the special meeting that, if approved by stockholders, would authorize us to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors, for a twelve-month period expiring on the one-year anniversary of the date of the special meeting.

              In addition, at our 2009 annual stockholders meeting, our stockholders approved a proposal authorizing us to sell or otherwise issue warrants or securities to subscribe for or convertible into shares of our common stock subject to certain limitations (including, without limitation, that the number of shares issuable does not exceed 25% of our then outstanding common stock and that the exercise or conversion price thereof is not, at the date of issuance, less than the greater of the market value per share and the net asset value per share of our common stock). The authorization granted to sell or issue warrants or securities to subscribe for or convertible into shares of our common stock has no expiration.

              Any decision to sell shares of our common stock below its then current net asset value per share or securities to subscribe for or convertible into shares of our common stock would be subject to the determination by our board of directors that such issuance is in our and our stockholders' best interests.

              If we were to sell shares of our common stock below its then current net asset value per share, such sales would result in an immediate dilution to the net asset value per share of our common stock. This dilution would occur as a result of the sale of shares at a price below the then current net asset value per share of our common stock and a proportionately greater decrease in the stockholders' interest in our earnings and assets and their voting interest in us than the increase in our assets resulting from such issuance. Because the number of shares of common stock that could be so issued and the timing of any issuance is not currently known, the actual dilutive effect cannot be predicted.

              In addition, if we issue warrants or securities to subscribe for or convertible into shares of our common stock, subject to certain limitations, the exercise or conversion price per share could be less than net asset value per share at the time of exercise or conversion (including through the operation of anti-dilution protections). Because we would incur expenses in connection with any issuance of such securities, such issuance could result in a dilution of the net asset value per share at the time of exercise or conversion. This dilution would include reduction in net asset value per share as a result of the proportionately greater decrease in the stockholders' interest in our earnings and assets and their voting interest than the increase in our assets resulting from such issuance.

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              Further, if our current stockholders do not purchase any shares to maintain their percentage interest when we issue new shares, regardless of whether such offering is above or below the then current net asset value per share, their voting power will be diluted. For additional information and hypothetical examples of these risks, see "Sales of Common Stock Below Net Asset Value" and the prospectus supplement pursuant to which such sale is made.

Your interest in us may be diluted if you do not fully exercise your subscription rights in any rights offering. In addition, if the subscription price is less than our net asset value per share, then you will experience an immediate dilution of the aggregate net asset value of your shares.

              In the event we issue subscription rights, stockholders who do not fully exercise their subscription rights should expect that they will, at the completion of a rights offering pursuant to this prospectus, own a smaller proportional interest in us than would otherwise be the case if they fully exercised their rights. We cannot state precisely the amount of any such dilution in share ownership because we do not know at this time what proportion of the shares will be purchased as a result of such rights offering.

              In addition, if the subscription price is less than the net asset value per share of our common stock, then our stockholders would experience an immediate dilution of the aggregate net asset value of their shares as a result of the offering. The amount of any decrease in net asset value is not predictable because it is not known at this time what the subscription price and net asset value per share will be on the expiration date of a rights offering or what proportion of the shares will be purchased as a result of such rights offering. Such dilution could be substantial. See "Risk Factors—Risks Relating to Offerings Pursuant to this Prospectus—The net asset value per share of our common stock may be diluted if we sell shares of our common stock in one or more offerings at prices below the then current net asset value per share of our common stock or securities to subscribe for or convertible into shares of our common stock" and "Sales of Common Stock Below Net Asset Value."

Investors in offerings of our common stock will likely incur immediate dilution upon the closing of such offering.

              We generally expect the public offering price of any offering of shares of our common stock to be higher than the book value per share of our outstanding common stock (unless we offer shares pursuant to a rights offering or after obtaining prior approval for such issuance from our stockholders and our independent directors). Accordingly, investors purchasing shares of our common stock in offerings pursuant to this prospectus may pay a price per share that exceeds the tangible book value per share after such offering.

Our stockholders will experience dilution in their ownership percentage if they opt out of our dividend reinvestment plan.

              All dividends declared in cash payable to stockholders that are participants in our dividend reinvestment plan are automatically reinvested in shares of our common stock. As a result, our stockholders that opt out of our dividend reinvestment plan will experience dilution in their ownership percentage of our common stock over time.

Our stockholders may experience dilution upon the conversion of the Convertible Unsecured Notes.

              The 2022 Convertible Notes (as defined below) are convertible into shares of our common stock beginning on August 1, 2021 or, under certain circumstances, earlier. The 2024 Convertible Notes (as defined below) are convertible into shares of our common stock beginning on December 1, 2023 or, under certain circumstances, earlier. Upon conversion of the 2022 Convertible Notes or the 2024 Convertible Notes, we have the choice to pay or deliver, as the case may be, at our election, cash,

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shares of our common stock or a combination of cash and shares of our common stock. As of March 31, 2019, the conversion price of the 2022 Convertible Notes was effectively $19.32 per share and the conversion price of the 2024 Convertible Notes was effectively $19.88 per share, in each case taking into account certain de minimis adjustments that will be made on the conversion date and subject to further adjustment in certain circumstances. If we elect to deliver shares of common stock upon a conversion at the time our tangible book value per share exceeds the conversion price in effect at such time, our stockholders may incur dilution. In addition, our stockholders will experience dilution in their ownership percentage of common stock upon our issuance of common stock in connection with the conversion of the Convertible Unsecured Notes and any dividends paid on our common stock will also be paid on shares issued in connection with such conversion after such issuance.

Our stockholders may receive shares of our common stock as dividends, which could result in adverse cash flow consequences to them.

              In order to satisfy the Annual Distribution Requirement applicable to RICs, we have the ability to declare a large portion of a dividend in shares of our common stock instead of in cash. As long as a portion of such dividend is paid in cash (which portion could be as low as 20%) and certain requirements are met, the entire distribution would be treated as a dividend for U.S. federal income tax purposes. As a result, a stockholder would be taxed on 100% of the fair market value of the shares received as part of the dividend on the date a stockholder received it in the same manner as a cash dividend, even though most of the dividend was paid in shares of our common stock.

Sales of substantial amounts of our common stock in the public market may have an adverse effect on the market price of our common stock.

              Sales of substantial amounts of our common stock, or the availability of such common stock for sale (including as a result of the conversion of our Convertible Unsecured Notes into common stock), could adversely affect the prevailing market prices for our common stock. If this occurs and continues, it could impair our ability to raise additional capital through the sale of securities should we desire to do so.

The trading market or market value of our publicly issued debt securities may fluctuate.

              Our publicly issued debt securities may or may not have an established trading market. We cannot assure you that a trading market for our publicly issued debt securities will ever develop or be maintained if developed. In addition to our creditworthiness, many factors may materially adversely affect the trading market for, and market value of, our publicly issued debt securities. These factors include, but are not limited to, the following:

    the time remaining to the maturity of these debt securities;

    the outstanding principal amount of debt securities with terms identical to these debt securities;

    the ratings assigned by national statistical ratings agencies;

    the general economic environment;

    the supply of such debt securities trading in the secondary market, if any;

    the redemption or repayment features, if any, of these debt securities;

    the level, direction and volatility of market interest rates generally; and

    market rates of interest higher or lower than rates borne by the debt securities.

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              You should also be aware that there may be a limited number of buyers if and when you decide to sell your debt securities. This too may materially adversely affect the market value of the debt securities or the trading market for the debt securities.

Terms relating to redemption may materially adversely affect your return on any debt securities that we may issue.

              If your debt securities are redeemable at our option, we may choose to redeem your debt securities at times when prevailing interest rates are lower than the interest rate paid on your debt securities. In addition, if your debt securities are subject to mandatory redemption, we may be required to redeem your debt securities also at times when prevailing interest rates are lower than the interest rate paid on your debt securities. In this circumstance, you may not be able to reinvest the redemption proceeds in a comparable security at an effective interest rate as high as your debt securities being redeemed.

Our credit ratings may not reflect all risks of an investment in our debt securities.

              Our credit ratings are an assessment by third parties of our ability to pay our obligations. Consequently, real or anticipated changes in our credit ratings will generally affect the market value of our debt securities. Our credit ratings, however, may not reflect the potential impact of risks related to market conditions generally or other factors discussed above on the market value of or trading market for the publicly issued debt securities.

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FORWARD-LOOKING STATEMENTS

               Some of the statements in this prospectus and the prospectus supplement, including the documents we incorporate by reference herein, constitute forward-looking statements, which relate to future events or our future performance or financial condition. The forward-looking statements contained in this prospectus and the prospectus supplement, including the documents we incorporate by reference herein, involve a number of risks and uncertainties, including statements concerning :

    our, or our portfolio companies', future business, operations, operating results or prospects;

    the return or impact of current and future investments;

    the impact of a protracted decline in the liquidity of credit markets on our business;

    the impact of fluctuations in interest rates on our business;

    the impact of changes in laws or regulations (including the interpretation thereof), including the Tax Cuts and Jobs Act and the SBCAA, governing our operations or the operations of our portfolio companies or the operations of our competitors;

    the valuation of our investments in portfolio companies, particularly those having no liquid trading market;

    our ability to recover unrealized losses;

    our ability to successfully invest any capital raised in an offering;

    market conditions and our ability to access alternative debt markets and additional debt and equity capital and our ability to manage our capital resources effectively;

    our contractual arrangements and relationships with third parties, including parties to our co-investment program;

    the general economy and its impact on the industries in which we invest;

    uncertainty surrounding the financial stability of the United States, Europe and China;

    the social, geopolitical, financial, trade and legal implications of Brexit;

    Middle East turmoil and the potential for volatility in energy prices and its impact on the industries in which we invest;

    the financial condition of and ability of our current and prospective portfolio companies to achieve their objectives;

    our expected financings and investments;

    our ability to successfully complete and integrate any other acquisitions;

    the outcome and impact of any litigation;

    the adequacy of our cash resources and working capital;

    the timing, form and amount of any dividend distributions;

    the timing of cash flows, if any, from the operations of our portfolio companies; and

    the ability of our investment adviser to locate suitable investments for us and to monitor and administer our investments.

              We use words such as "anticipates," "believes," "expects," "intends," "will," "should," "may" and similar expressions to identify forward-looking statements, although not all forward-looking statements include these words. Our actual results and condition could differ materially from those

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implied or expressed in the forward-looking statements for any reason, including the factors set forth in "Risk Factors" and the other information included in this prospectus and the prospectus supplement, including the documents we incorporate by reference herein.

              You should not place undue reliance on these forward-looking statements, which are based on information available to us as of the date of this prospectus or the prospectus supplement, as applicable, including any documents incorporated by reference. Except as required by the federal securities laws, we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise.

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USE OF PROCEEDS

              Unless otherwise specified in a prospectus supplement, we intend to use the net proceeds from the sale of our securities for general corporate purposes, which include investing in portfolio companies in accordance with our investment objective. We also expect to use the net proceeds of an offering to repay or repurchase outstanding indebtedness, which may include indebtedness (approximately $6.3 billion aggregate principal amount outstanding as of March 31, 2019) under (a) the Revolving Credit Facility ($2.0 billion outstanding as of March 31, 2019), (b) the Revolving Funding Facility ($620 million outstanding as of March 31, 2019), (c) the SMBC Funding Facility ($105 million outstanding as of March 31, 2019), (d) the 2022 Convertible Notes (approximately $388 million aggregate principal amount outstanding as of March 31, 2019), (e) the 2024 Convertible Notes (approximately $403 million aggregate principal amount outstanding as of March 31, 2019), (f) the 2020 Notes (as defined below) (approximately $600 million aggregate principal amount outstanding as of March 31, 2019), (g) the 2022 Notes (as defined below) (approximately $600 million aggregate principal amount outstanding as of March 31, 2019), (h) the 2023 Notes (as defined below) (approximately $750 million aggregate principal amount outstanding as of March 31, 2019), (i) the 2025 Notes (as defined below) (approximately $600 million aggregate principal amount outstanding as of March 31, 2019) and (j) the 2047 Notes (as defined below) (approximately $230 million aggregate principal amount outstanding as of March 31, 2019).

              The interest charged on the indebtedness incurred under the Revolving Credit Facility is based on LIBOR (one-, two-, three- or six-month) plus an applicable spread of either 1.75% or 1.875% or an "alternate base rate" (as defined in the agreements governing the Revolving Credit Facility) plus an applicable spread of either 0.75% or 0.875%, in each case, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. As of March 31, 2019, the one-, two-, three- and six-month LIBOR was 2.49%, 2.56%, 2.60% and 2.66%, respectively. As of March 31, 2019, the Revolving Credit Facility consists of a $414 million term loan tranche with a stated maturity date of March 30, 2023 and a $1.7 billion revolving tranche. As of March 31, 2019, for $1.6 billion of the revolving tranche of the Revolving Credit Facility, the expiration date is March 30, 2023, for $50 million of the revolving tranche of the Revolving Credit Facility, the expiration date is January 4, 2022 and for the remaining $45 million, the expiration date is May 4, 2020. The interest rate charged on the indebtedness incurred under the Revolving Funding Facility is based on LIBOR plus 2.00% per annum or a "base rate" (as defined in the agreements governing the Revolving Funding Facility) plus 1.00% per annum. The Revolving Funding Facility is scheduled to expire on January 3, 2024 (subject to extension exercisable upon mutual consent). The interest rate charged on the indebtedness incurred under the SMBC Funding Facility is based on an applicable spread of either 1.75% or 2.00% over LIBOR or 0.75% or 1.00% over a "base rate" (as defined in the agreements governing the SMBC Funding Facility), in each case, determined monthly based on the amount of the average borrowings outstanding under the SMBC Funding Facility. The SMBC Funding Facility is scheduled to expire on September 14, 2024 (subject to two one-year extension options exercisable upon mutual consent).

              The interest charged on the Convertible Unsecured Notes and the Unsecured Notes is as follows: (a) 3.75% in the case of the 2022 Convertible Notes, (b) 4.625% in the case of the 2024 Convertible Notes, (c) 3.875% in the case of the 2020 Notes, (d) 3.625% in the case of the 2022 Notes, (e) 3.500% in the case of the 2023 Notes, (f) 4.250% in the case of the 2025 Notes and (g) 6.875% in the case of the 2047 Notes. The 2022 Convertible Notes and the 2024 Convertible Notes mature on February 1, 2022 and March 1, 2024, respectively. The 2020 Notes, the 2022 Notes, the 2023 Notes, the 2025 Notes and the 2047 Notes mature on January 15, 2020, January 19, 2022, February 10, 2023, March 1, 2025 and April 15, 2047, respectively. The supplement to this prospectus relating to an offering may more fully identify the use of the proceeds from such offering.

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              We anticipate that substantially all of the net proceeds of an offering of securities pursuant to this prospectus and its related prospectus supplement will be used for the above purposes within three months of any such offering, depending on the availability of appropriate investment opportunities consistent with our investment objective, but no longer than within six months of any such offerings.

              While our primary focus is to generate current income and capital appreciation through investments in first and second lien senior secured loans and mezzanine debt and, to a lesser extent, equity securities of eligible portfolio companies, we also may invest up to 30% of our portfolio in non-qualifying assets, as permitted by the Investment Company Act. See "Regulation." Specifically, as part of this 30% basket, we may invest in entities that are not considered "eligible portfolio companies" (as defined in the Investment Company Act), including companies located outside of the United States, entities that are operating pursuant to certain exceptions under the Investment Company Act, and publicly traded entities whose public equity market capitalization exceeds the levels provided for under the Investment Company Act. Pending such investments, we will invest a portion of the net proceeds primarily in cash, cash equivalents, U.S. government securities and other high-quality short-term investments. These securities generally earn yields substantially lower than the income that we anticipate receiving once we are fully invested in accordance with our investment objective. As a result, we may not, for a time, be able to achieve our investment objective and/or we may need to, for a time, decrease the amount of any dividend that we may pay to our stockholders to a level that is substantially lower than the level that we expect to pay when the net proceeds of offerings are fully invested in accordance with our investment objective. If we do not realize yields in excess of our expenses, we may incur operating losses and the market price of our common stock and debt securities may decline. See "Regulation—Temporary Investments" for additional information about temporary investments we may make while waiting to make longer-term investments in pursuit of our investment objective.

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PRICE RANGE OF COMMON STOCK AND DISTRIBUTIONS

              Our common stock is traded on The NASDAQ Global Select Market under the symbol "ARCC." Our common stock has historically traded at prices both above and below our net asset value per share. It is not possible to predict whether our common stock will trade at, above or below net asset value. See "Risk Factors—Risks Relating to Offerings Pursuant to this Prospectus—Our shares of common stock have traded at a discount from net asset value and may do so again in the future, which could limit our ability to raise additional equity capital."

              The following table sets forth, for the first two quarters of the year ending December 31, 2019 and each fiscal quarter for the fiscal years ended December 31, 2018 and 2017, the net asset value per share of our common stock, the range of high and low closing sales prices of our common stock, the closing sales price as a premium (discount) to net asset value and the dividends or distributions declared by us. On May 21, 2019, the last reported closing sales price of our common stock on The NASDAQ Global Select Market was $17.96 per share, which represented a premium of approximately 4.4% to the net asset value per share reported by us as of March 31, 2019.

 
   
   
   
  High
Sales Price
Premium
(Discount)
to Net Asset
Value(2)
  Low
Sales Price
Premium
(Discount)
to Net Asset
Value(2)
   
 
 
   
  Price Range   Cash
Dividend
Per
Share(3)
 
 
  Net Asset
Value(1)
 
 
  High   Low  

Year ended December 31, 2017

                                     

First Quarter

  $ 16.50   $ 17.81   $ 16.42     7.94 %   (0.48 )% $ 0.38  

Second Quarter

  $ 16.54   $ 17.64   $ 16.18     6.65 %   (2.18 )% $ 0.38  

Third Quarter

  $ 16.49   $ 16.52   $ 15.67     (0.18 )%   (5.07 )% $ 0.38  

Fourth Quarter

  $ 16.65   $ 16.61   $ 15.69     (0.24 )%   (5.77 )% $ 0.38  

Year ended December 31, 2018

                                     

First Quarter

  $ 16.84   $ 16.28   $ 15.25     (3.33 )%   (9.44 )% $ 0.38  

Second Quarter

  $ 17.05   $ 17.09   $ 15.90     0.23 %   (6.75 )% $ 0.38  

Third Quarter

  $ 17.16   $ 17.51   $ 16.45     2.04 %   (4.14 )% $ 0.39  

Fourth Quarter

  $ 17.12   $ 17.58   $ 14.71     2.69 %   (14.08 )% $ 0.39  

Year ended December 31, 2019

                                     

First Quarter

  $ 17.21   $ 17.48   $ 15.28     1.57 %   (11.21 )% $ 0.48 (4)

Second Quarter (through May 16, 2019)

    *   $ 18.00   $ 17.22     *     *   $ 0.40  

(1)
Net asset value per share is determined as of the last day in the relevant quarter and therefore may not reflect the net asset value per share on the date of the high and low closing sales prices. The net asset values shown are based on outstanding shares at the end of the relevant quarter.

(2)
Calculated as the respective high or low closing sales price less net asset value, divided by net asset value (in each case, as of the applicable quarter).

(3)
Represents the dividend or distribution declared in the relevant quarter.

(4)
Consists of a quarterly dividend of $0.40 per share and additional dividends of $0.02 per share, all of which were declared in the first quarter of 2019, payable on March 28, 2019, June 28, 2019, September 30, 2019 and December 27, 2019, subject to the satisfaction of certain Maryland Law requirements.

*
Net asset value has not yet been calculated for this period.

              We currently intend to distribute dividends or make distributions to our stockholders on a quarterly basis out of assets legally available for distribution. We may also distribute additional dividends or make additional distributions to our stockholders from time to time. Our quarterly and additional dividends or distributions, if any, will be determined by our board of directors.

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              The following table summarizes our dividends or distributions declared and payable for the fiscal years ended December 31, 2017, 2018 and 2019:

Date Declared
  Record Date   Payment Date   Amount  

February 22, 2017

  March 15, 2017   March 31, 2017   $ 0.38  

May 3, 2017

  June 15, 2017   June 30, 2017   $ 0.38  

August 2, 2017

  September 15, 2017   September 29, 2017   $ 0.38  

November 2, 2017

  December 15, 2017   December 29, 2017   $ 0.38  

Total declared and payable for 2017

          $ 1.52  

February 13, 2018

  March 15, 2018   March 30, 2018   $ 0.38  

May 2, 2018

  June 15, 2018   June 29, 2018   $ 0.38  

August 1, 2018

  September 14, 2018   September 28, 2018   $ 0.39  

October 31, 2018

  December 14, 2018   December 28, 2018   $ 0.39  

Total declared and payable for 2018

          $ 1.54  

February 12, 2019

  March 15, 2019   March 28, 2019   $ 0.40  

February 12, 2019

  March 15, 2019   March 28, 2019   $ 0.02 (1)

February 12, 2019

  June 14, 2019   June 28, 2019   $ 0.02 (1)

February 12, 2019

  September 16, 2019   September 30, 2019   $ 0.02 (1)

February 12, 2019

  December 16, 2019   December 27, 2019   $ 0.02 (1)

April 30, 2019

  June 14, 2019   June 28, 2019   $ 0.40  

Total declared and payable for 2019

          $ 0.88  

(1)
Represents an additional dividend.

              Of the $1.54 per share in dividends declared and payable for the year ended December 31, 2018, $1.54 per share was comprised of ordinary income and no amounts were comprised of long-term capital gains. Of the $1.52 per share in dividends declared and payable for the year ended December 31, 2017, $1.45 per share was comprised of ordinary income and $0.07 was comprised of long-term capital gains.

              To maintain our RIC status under the Code, we must timely distribute an amount equal to at least 90% of our investment company taxable income (as defined by the Code, which generally includes net ordinary income and net short term capital gains) to our stockholders. In addition, we generally will be required to pay an excise tax equal to 4% on certain undistributed taxable income unless we distribute in a timely manner an amount at least equal to the sum of (i) 98% of our ordinary income recognized during a calendar year, (ii) 98.2% of our capital gain net income, as defined by the Code, recognized for the one year period ending October 31st in that calendar year, and (iii) any income recognized, but not distributed, in preceding years (to the extent that income tax was not imposed on such amounts). The taxable income on which we pay excise tax is generally distributed to our stockholders in the next tax year. Depending on the level of taxable income earned in a tax year, we may choose to carry forward such taxable income for distribution in the following year, and pay any applicable excise tax. For the three months ended March 31, 2019, we recorded an excise tax expense of $4 million. For the years ended December 31, 2018 and 2017, we recorded a net excise tax expense of $14 million and $12 million, respectively. The net expense for the year ended December 31, 2017 included a net reduction in expense related to the recording of a requested refund resulting from the overpayment of the prior year's excise tax of $1 million. We cannot assure you that we will achieve results that will permit the payment of any cash distributions. We maintain an "opt out" dividend reinvestment plan for our common stockholders. As a result, if we declare a cash dividend, stockholders' cash dividends will be automatically reinvested in additional shares of our common stock, unless they specifically "opt out" of the dividend reinvestment plan so as to receive cash dividends. See "Dividend Reinvestment Plan."

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

               The information contained in this section should be read in conjunction with the "Selected Condensed Consolidated Financial Data of Ares Capital" and our financial statements and notes thereto appearing elsewhere in this prospectus or the accompanying prospectus supplement. Further, the financial information and other data set forth below subsequent to the completion of our acquisition of American Capital, Ltd. ("American Capital") (the "American Capital Acquisition") on January 3, 2017, reflect the results of the combined company and the financial information and other data prior to the completion of the American Capital Acquisition and does not give effect to the American Capital Acquisition, unless otherwise noted. For this reason, period to period comparisons may not be meaningful.

OVERVIEW

              We are a specialty finance company that is a closed-end, non-diversified management investment company incorporated in Maryland. We have elected to be regulated as a BDC under the Investment Company Act.

              We are externally managed by Ares Capital Management, a subsidiary of Ares Management, a publicly traded, leading global alternative asset manager, pursuant to our investment advisory and management agreement. Our administrator, a subsidiary of Ares Management, provides certain administrative and other services necessary for us to operate, pursuant to our administration agreement.

              Our investment objective is to generate both current income and capital appreciation through debt and equity investments. We invest primarily in first lien senior secured loans (including unitranche loans), second lien senior secured loans and mezzanine debt, which in some cases includes an equity component like warrants.

              To a lesser extent, we also make preferred and/or common equity investments, which have generally been non-control equity investments, of less than $20 million (usually in conjunction with a concurrent debt investment). However, we may increase the size or change the nature of these investments.

              Since our IPO on October 8, 2004 through March 31, 2019, our exited investments resulted in an asset level realized gross internal rate of return to us of approximately 14% (based on original cash invested, net of syndications, of approximately $25.4 billion and total proceeds from such exited investments of approximately $32.5 billion). Internal rate of return is the discount rate that makes the net present value of all cash flows related to a particular investment equal to zero. Internal rate of return is gross of expenses related to investments as these expenses are not allocable to specific investments. Investments are considered to be exited when the original investment objective has been achieved through the receipt of cash and/or non-cash consideration upon the repayment of a debt investment or sale of an investment or through the determination that no further consideration was collectible and, thus, a loss may have been realized. Approximately 62% of these exited investments resulted in an asset level realized gross internal rate of return to us of 10% or greater.

              Additionally, since the closing of the American Capital Acquisition on January 3, 2017 through March 31, 2019, exited investments acquired in the American Capital Acquisition resulted in an asset level realized gross internal rate of return to us of approximately 36% (based on original amounts invested of approximately $1.7 billion and total proceeds from such exited investments of approximately $2.3 billion).

              Additionally, since our IPO on October 8, 2004 through March 31, 2019, our realized gains have exceeded our realized losses by approximately $1.0 billion (excluding a one-time gain on the acquisition of Allied Capital Corporation ("Allied Capital") and realized gains/losses from the

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extinguishment of debt and other transactions). For this same time period, our average annualized net realized gain rate was approximately 1.2% (excluding realized gains/losses from the extinguishment of debt and other transactions). Net realized gain/loss rates for a particular period are the amount of net realized gains/losses during such period divided by the average quarterly investments at amortized cost in such period.

              Information included herein regarding internal rates of return, realized gains and losses and annualized net realized gain rates are historical results relating to our past performance and are not necessarily indicative of future results, the achievement of which cannot be assured.

              As a BDC, we are required to comply with certain regulatory requirements. For instance, we generally have to invest at least 70% of our total assets in "qualifying assets," including securities and indebtedness of private U.S. companies and certain public U.S. companies, cash, cash equivalents, U.S. government securities and high-quality debt investments that mature in one year or less. We also may invest up to 30% of our portfolio in non-qualifying assets, as permitted by the Investment Company Act. Specifically, as part of this 30% basket, we may invest in entities that are not considered "eligible portfolio companies" (as defined in the Investment Company Act), including companies located outside of the United States, entities that are operating pursuant to certain exceptions under the Investment Company Act, and publicly traded entities whose public equity market capitalization exceeds the levels provided for under the Investment Company Act.

              We have elected to be treated as a RIC under the Code and operate in a manner so as to qualify for the tax treatment applicable to RICs. To qualify as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements and timely distribute to our stockholders generally at least 90% of our investment company taxable income, as defined by the Code, for each year. Pursuant to this election, we generally will not have to pay U.S. federal corporate-level taxes on any income that we distribute to our stockholders provided that we satisfy those requirements.

American Capital Acquisition

              On May 23, 2016, we entered into a definitive agreement to acquire American Capital, a Delaware corporation, in a cash and stock transaction valued at approximately $4.2 billion. At January 3, 2017, the total cash and stock consideration paid by us was $3.3 billion. In connection with the stock consideration, we issued approximately 112 million shares of our common stock to American Capital's then-existing stockholders (including holders of outstanding in-the-money American Capital stock options), thereby resulting in our then-existing stockholders owning approximately 73.7% of the combined company and then-existing American Capital stockholders owning approximately 26.3% of the combined company.

Fee Waiver

              In connection with the American Capital Acquisition, Ares Capital Management agreed to waive, for each of the first ten calendar quarters beginning with the second quarter of 2017 and ending with the third quarter of 2019, the lesser of (x) $10 million of income based fees and (y) the amount of income based fees for such quarter, in each case, to the extent payable by us in such quarter pursuant to and as calculated under our investment advisory and management agreement.

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PORTFOLIO AND INVESTMENT ACTIVITY

              Our investment activity for the three months ended March 31, 2019 and 2018 and for the years ended December 31, 2018, 2017 and 2016 is presented below.

 
  For the Three Months
Ended March 31,
  For the Years
Ended
December 31,
 
(dollar amounts in millions)
  2019   2018   2018   2017   2016  

New investment commitments(1)(5)(10):

                               

New portfolio companies

  $ 1,015   $ 716   $ 3,754   $ 2,155   $ 2,107  

Existing portfolio companies

    938     1,076     4,291     3,734     1,596  

Total new investment commitments(2)

  $ 1,953   $ 1,792     8,045     5,889     3,703  

Less:

                               

Investment commitments exited(3)

    1,353     1,342     6,476     5,593     3,844  

Net investment commitments

  $ 600   $ 450   $ 1,569   $ 296   $ (141 )

Principal amount of investments funded(5)(10):

                               

First lien senior secured loans

  $ 851   $ 691   $ 4,465   $ 3,442   $ 1,965  

Second lien senior secured loans

    727     305     1,607     1,491     987  

Subordinated certificates of the SDLP(4)

    142     44     252     222     272  

Subordinated certificates of the SSLP

                        3  

Senior subordinated loans

        358     376     273     173  

Preferred equity securities

    147     2     130     120     37  

Other equity securities

    74     219     346     116     53  

Total

  $ 1,941   $ 1,619   $ 7,176   $ 5,664   $ 3,490  

Principal amount of investments sold or repaid(6):

                               

First lien senior secured loans

  $ 882   $ 751   $ 3,762   $ 2,394   $ 2,522  

Second lien senior secured loans

    390     399     1,657     1,536     903  

Subordinated certificates of the SDLP(4)

    2     52     88     4     2  

Subordinated certificates of the SSLP(5)

                    474      

Senior subordinated loans

        163     718     269     189  

Collateralized loan obligations

    1     6     71     150      

Preferred equity securities

    1     1     80     275     4  

Other equity securities

    13     6     64     476     35  

Total

  $ 1,289   $ 1,378   $ 6,440   $ 5,578   $ 3,655  

Principal amount of investments acquired as part of the American Capital Acquisition on January 3, 2017:

                               

First lien senior secured loans

                    $ 550        

Second lien senior secured loans

                      855        

Senior subordinated loans

                      244        

Collateralized loan obligations

                      265        

Preferred equity securities

                      109        

Other equity securities

                      520        

Total

                    $ 2,543        

Number of new investment commitments(5)(7)(10)

    37     34     172     155     82  

Average new investment commitment amount(5)(10)

  $ 53   $ 53   $ 47   $ 38   $ 45  

Weighted average term for new investment commitments (in months)(5)(10)

    90     73     76     75     80  

Percentage of new investment commitments at floating rates(5)(10)

    94 %   82 %   94 %   94 %   91 %

Percentage of new investment commitments at fixed rates(5)(10)

    2 %   6 %   2 %   4 %   6 %

Weighted average yield of debt and other income producing securities(5)(8)(10):

                               

Funded during the period at amortized cost

    10.3 %   9.6 %   9.0 %   9.0 %   9.3 %

Funded during the period at fair value(9)

    10.3 %   9.6 %   9.1 %   9.0 %   9.2 %

Exited or repaid during the period at amortized cost

    8.9 %   8.9 %   9.2 %   8.9 %   8.5 %

Exited or repaid during the period at fair value(9)

    8.9 %   8.9 %   9.2 %   8.9 %   8.4 %

Weighted average yield of debt and other income producing securities acquired as part of the American Capital Acquisition on January 3, 2017(8):

                               

Funded during the period at amortized cost

                    10.0 %    

Funded during the period at fair value(9)

                    10.0 %    

(1)
New investment commitments include new agreements to fund revolving loans or delayed draw loans. See "Off Balance Sheet Arrangements" as well as Note 7 to our consolidated financial statements for the three months ended March 31, 2019 and the year ended December 31, 2018, for more information on our commitments to fund revolving loans or delayed draw loans.

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(2)
Includes both funded and unfunded commitments. Of these new investment commitments, we funded $1.7 billion and $1.5 billion for the three months ended March 31, 2019 and 2018, respectively, and $6.6 billion, $5.1 billion and $3.3 billion for the years ended December 31, 2018, 2017 and 2016, respectively.

(3)
Includes both funded and unfunded commitments. For the three months ended March 31, 2019 and 2018, investment commitments exited included exits of unfunded commitments of $133 million and $31 million, respectively. For the years ended December 31, 2018, 2017 and 2016, investment commitments exited included exits of unfunded commitments of $385 million, $301 million and $341 million, respectively.

(4)
See "Senior Direct Lending Program" below and Note 4 to our consolidated financial statements for the three months ended March 31, 2019 and the year ended December 31, 2018 for more information on the SDLP (as defined below).

(5)
In July 2017, in connection with the effective termination of Senior Secured Loan Fund LLC (d/b/a the "Senior Secured Loan Program" or the "SSLP"), we purchased $1.6 billion in aggregate principal amount of first lien senior secured loans outstanding at par plus accrued and unpaid interest and fees from the SSLP (the "SSLP Loan Sale") and assumed the SSLP's remaining unfunded loan commitments totaling $50 million. The loans purchased from the SSLP included loans to 10 different borrowers with a weighted average yield at amortized cost and fair value of 7.1% and 7.1%, respectively. Upon completion of the SSLP Loan Sale, the SSLP made a liquidation distribution to the holders of the subordinated certificates of the SSLP (the "SSLP Certificates"), of which Ares Capital received $1.5 billion. The impact of these transactions is excluded from the information presented in the table. See "Senior Secured Loan Program" below and Note 4 to our consolidated financial statements for the year ended December 31, 2018 for more information on the SSLP.

(6)
For the years ended December 31, 2018 and 2017, the principal amount of investments sold or repaid included $0.9 billion and $1.1 billion, respectively, of investments acquired as part of the American Capital Acquisition.

(7)
Number of new investment commitments represents each commitment to a particular portfolio company or a commitment to multiple companies as part of an individual transaction (e.g., the purchase of a portfolio of investments).

(8)
"Weighted average yield of debt and other income producing securities" is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of original issue discount and market discount or premium earned on accruing debt and other income producing securities, divided by (b) the total accruing debt and other income producing securities at amortized cost or at fair value, as applicable.

(9)
Represents fair value for investments in the portfolio as of the most recent prior quarter end, if applicable.

(10)
Excludes investments acquired as part of the American Capital Acquisition on January 3, 2017. See Note 16 to our consolidated financial statements for the year ended December 31, 2018 for additional information regarding the American Capital Acquisition.

              As of March 31, 2019 and December 31, 2018, our investments consisted of the following:

 
  As of  
 
  March 31, 2019   December 31, 2018  
(in millions)
  Amortized
Cost
  Fair
Value
  Amortized
Cost
  Fair
Value
 

First lien senior secured loans

  $ 5,953   $ 5,785   $ 5,976   $ 5,836  

Second lien senior secured loans

    4,220     3,976     3,878     3,657  

Subordinated certificates of the SDLP(1)

    792     792     652     652  

Senior subordinated loans

    726     742     717     727  

Collateralized loan obligations

    43     43     44     45  

Preferred equity securities

    734     601     576     444  

Other equity securities

    972     1,125     911     1,056  

Total

  $ 13,440   $ 13,064   $ 12,754   $ 12,417  

(1)
The proceeds from these certificates were applied to co-investments with Varagon and its clients to fund first lien senior secured loans to 22 and 21 different borrowers as of March 31, 2019 and December 31, 2018, respectively.

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              The weighted average yields at amortized cost and fair value of the following portions of our portfolio as of March 31, 2019 and December 31, 2018 were as follows:

 
  As of  
 
  March 31, 2019   December 31, 2018  
 
  Amortized
Cost
  Fair
Value
  Amortized
Cost
  Fair
Value
 

Debt and other income producing securities(1)

    10.4 %   10.5 %   10.2 %   10.3 %

Total portfolio(2)

    9.3 %   9.5 %   9.0 %   9.3 %

First lien senior secured loans(2)

    8.6 %   8.9 %   8.4 %   8.7 %

Second lien senior secured loans(2)

    10.5 %   11.2 %   10.4 %   11.1 %

Subordinated certificates of the SDLP(2)(3)

    14.8 %   14.8 %   15.0 %   15.0 %

Senior subordinated loans(2)

    13.1 %   12.8 %   12.7 %   12.5 %

Collateralized loan obligations

    22.7 %   22.9 %   22.7 %   22.2 %

Income producing equity securities(2)

    13.1 %   12.7 %   13.5 %   13.4 %

(1)
"Weighted average yield of debt and other income producing securities" is computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of original issue discount and market discount or premium earned on accruing debt and other income producing securities, divided by (b) the total accruing debt and other income producing securities at amortized cost or at fair value as applicable.

(2)
"Weighted average yields" are computed as (a) the annual stated interest rate or yield earned plus the net annual amortization of original issue discount and market discount or premium earned on the relevant accruing debt and other income producing securities, divided by (b) the total relevant investments at amortized cost or at fair value as applicable.

(3)
The proceeds from these certificates were applied to co-investments with Varagon and its clients to fund first lien senior secured loans.

              Ares Capital Management, our investment adviser, employs an investment rating system to categorize our investments. In addition to various risk management and monitoring tools, our investment adviser grades the credit risk of all investments on a scale of 1 to 4 no less frequently than quarterly. This system is intended primarily to reflect the underlying risk of a portfolio investment relative to our initial cost basis in respect of such portfolio investment (i.e., at the time of origination or acquisition), although it may also take into account under certain circumstances the performance of the portfolio company's business, the collateral coverage of the investment and other relevant factors. Under this system, investments with a grade of 4 involve the least amount of risk to our initial cost basis. The trends and risk factors for this investment since origination or acquisition are generally favorable, which may include the performance of the portfolio company or a potential exit. Investments graded 3 involve a level of risk to our initial cost basis that is similar to the risk to our initial cost basis at the time of origination or acquisition. This portfolio company is generally performing as expected and the risk factors to our ability to ultimately recoup the cost of our investment are neutral to favorable. All investments or acquired investments in new portfolio companies are initially assessed a grade of 3. Investments graded 2 indicate that the risk to our ability to recoup the initial cost basis of such investment has increased materially since origination or acquisition, including as a result of factors such as declining performance and non-compliance with debt covenants; however, payments are generally not more than 120 days past due. An investment grade of 1 indicates that the risk to our ability to recoup the initial cost basis of such investment has substantially increased since origination or acquisition, and the portfolio company likely has materially declining performance. For debt investments with an investment grade of 1, most or all of the debt covenants are out of compliance and payments are substantially delinquent. For investments graded 1, it is anticipated that we will not

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recoup our initial cost basis and may realize a substantial loss of our initial cost basis upon exit. For investments graded 1 or 2, our investment adviser enhances its level of scrutiny over the monitoring of such portfolio company. The grade of a portfolio investment may be reduced or increased over time.

              Set forth below is the grade distribution of our portfolio companies as of March 31, 2019 and December 31, 2018:

 
  As of  
 
  March 31, 2019   December 31, 2018  
(dollar amounts in millions)
  Fair Value   %   Number of
Companies
  %   Fair
Value
  %   Number of
Companies
  %  

Grade 1

  $ 103     0.8 %   21     6.1 % $ 107     0.9 %   18     5.2 %

Grade 2

    536     4.1 %   12     3.5 %   455     3.7 %   12     3.5 %

Grade 3

    10,999     84.2 %   297     86.1 %   10,680     85.9 %   300     87.2 %

Grade 4

    1,426     10.9 %   15     4.3 %   1,175     9.5 %   14     4.1 %

Total

  $ 13,064     100.0 %   345     100.0 % $ 12,417     100.0 %   344     100.0 %

              As of March 31, 2019 and December 31, 2018, the weighted average grade of the investments in our portfolio at fair value was 3.1 and 3.0, respectively.

              As of March 31, 2019, investments on non-accrual status represented 2.3% and 0.4% of the total investments at amortized cost and at fair value, respectively. As of December 31, 2018, investments on non-accrual status represented 2.5% and 0.6% of the total investments at amortized cost and at fair value, respectively.

Co-Investment Program

      Senior Direct Lending Program

              We have established a joint venture with Varagon to make certain first lien senior secured loans, including certain stretch senior and unitranche loans, primarily to U.S. middle market companies. Varagon was formed in 2013 as a lending platform by American International Group, Inc. and other partners. The joint venture is called the SDLP. In July 2016, we and Varagon and its clients completed the initial funding of the SDLP. The SDLP may generally commit and hold individual loans of up to $300 million. The SDLP is capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of ours and Varagon (with approval from a representative of each required).

              We provide capital to the SDLP in the form of the SDLP Certificates, and Varagon and its clients provide capital to the SDLP in the form of senior notes, intermediate funding notes and the SDLP Certificates. As of March 31, 2019, we and a client of Varagon owned 87.5% and 12.5%, respectively, of the outstanding SDLP Certificates.

              As of March 31, 2019 and December 31, 2018, we and Varagon and its clients had agreed to make capital available to the SDLP of $6.2 billion and $6.4 billion, respectively, in the aggregate, of which $1,444 million and $1,444 million, respectively, is to be made available from us. This capital will

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only be committed to the SDLP upon approval of transactions by the investment committee of the SDLP. Below is a summary of the funded capital and unfunded capital commitments of the SDLP.

 
  As of    
 
(in millions)
  March 31,
2019
  December 31,
2018
 

Total capital funded to the SDLP(1)

  $ 3,331   $ 3,104  

Total capital funded to the SDLP by the Company(1)

  $ 792   $ 652  

Total unfunded capital commitments to the SDLP(2)

  $ 243   $ 187  

Total unfunded capital commitments to the SDLP by the Company(2)

  $ 58   $ 39  

(1)
At principal amount.

(2)
These commitments have been approved by the investment committee of the SDLP and will be funded as the transactions are completed.

              The SDLP Certificates pay a coupon of LIBOR plus 8.0% and also entitle the holders thereof to receive a portion of the excess cash flow from the loan portfolio, after expenses, which may result in a return to the holders of the SDLP Certificates that is greater than the stated coupon. The SDLP Certificates are junior in right of payment to the senior notes and intermediate funding notes.

              The amortized cost and fair value of the SDLP Certificates held by us were $792 million and $792 million, respectively, as of March 31, 2019 and $652 million and $652 million, respectively, as of December 31, 2018. Our yield on our investment in the SDLP at amortized cost and fair value was 14.8% and 14.8%, respectively, as of March 31, 2019 and 15.0% and 15.0%, respectively, as of December 31, 2018. For the three months ended March 31, 2019 and 2018, we earned interest income of $27 million and $18 million, respectively, from our investment in the SDLP Certificates. We are also entitled to certain fees in connection with the SDLP. For the three months ended March 31, 2019 and 2018, in connection with the SDLP, we earned capital structuring service and other fees totaling $4 million and $2 million, respectively.

              As of March 31, 2019 and December 31, 2018, the portfolio was comprised of all first lien senior secured loans primarily to U.S. middle-market companies and were in industries similar to the companies in our portfolio. As of March 31, 2019 and December 31, 2018, none of the loans were on non-accrual status. Below is a summary of the SDLP's portfolio as of March 31, 2019 and December 31, 2018:

 
  As of    
 
(dollar amounts in millions)
  March 31,
2019
  December 31,
2018
 

Total first lien senior secured loans(1)

  $ 3,322   $ 3,086  

Weighted average yield on first lien senior secured loans(2)

    8.4 %   8.4 %

Largest loan to a single borrower(1)

  $ 249   $ 249  

Total of five largest loans to borrowers(1)

  $ 1,178   $ 1,132  

Number of borrowers in the SDLP

    22     21  

Commitments to fund delayed draw loans(3)

  $ 243   $ 187  

(1)
At principal amount.

(2)
Computed as (a) the annual stated interest rate on accruing first lien senior secured loans, divided by (b) total first lien senior secured loans at principal amount.

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(3)
As discussed above, these commitments have been approved by the investment committee of the SDLP.

              Selected financial information for the SDLP as of March 31, 2019 and December 31, 2018 and for the three months ended March 31, 2019 and 2018, was as follows:

 
  As of    
 
(in millions)
  March 31,
2019
  December 31,
2018
 

Selected Balance Sheet Information:

             

Investments at fair value (amortized cost of $3,322 and $3,086)

  $ 3,271   $ 3,043  

Other assets

    87     92  

Total assets

  $ 3,358   $ 3,135  

Senior notes

  $ 2,349   $ 2,189  

Intermediate funding notes

    77     171  

Other liabilities

    57     54  

Total liabilities

    2,483     2,414  

Subordinated certificates and members' capital

    875     721  

Total liabilities and members' capital

  $ 3,358   $ 3,135  

 

 
  For the Three
Months Ended
March 31,
 
(in millions)
  2019   2018  

Selected Statement of Operations Information:

             

Total interest and other income

  $ 67   $ 50  

Interest expense

    33     25  

Other expenses

    6     2  

Total expenses

    39     27  

Net investment income

    28     23  

Net realized and unrealized losses on investments

    (8 )    

Net increase in members' capital resulting from operations

  $ 20   $ 23  


SDLP Loan Portfolio as of March 31, 2019

(dollar amounts in millions)
Portfolio Company
  Business Description   Maturity
Date
  Stated
Interest
Rate(1)
  Principal
Amount
  Fair
Value(2)
 

42 North Dental, LLC(3)

  Dental services provider     5/2022     8.5 % $ 132.5   $ 132.5  

ADCS Clinics Intermediate Holdings, LLC(3)

  Dermatology practice     5/2022     8.2 %   78.4     76.9  

AEP Holdings, Inc.(3)(4)

  Distributor of non-discretionary, mission-critical aftermarket replacement parts     8/2021     8.7 %   159.5     151.6  

BakeMark Holdings, Inc.

  Manufacturer and distributor of specialty bakery ingredients     8/2023     7.7 %   247.1     247.1  

Center for Autism and Related Disorders, LLC(3)

  Autism treatment and services provider specializing in applied behavior analysis therapy     11/2024     6.5 %   118.7     117.5  

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(dollar amounts in millions)
Portfolio Company
  Business Description   Maturity
Date
  Stated
Interest
Rate(1)
  Principal
Amount
  Fair
Value(2)
 

Chariot Acquisition, LLC(3)

  Aftermarket golf cart parts and accessories     9/2021     9.1 %   102.2     101.2  

Chesapeake Research Review, LLC(3)

  Provider of central institutional review boards over clinical trials     11/2023     8.4 %   249.5     249.5  

D4C Dental Brands, Inc.(3)(4)

  Dental services provider     12/2022     8.9 %   165.6     165.6  

Emergency Communications Network, LLC(3)

  Provider of mission critical emergency mass notification solutions     6/2023     8.8 %   220.9     212.0  

EN Engineering, L.L.C.(3)

  National utility services firm providing engineering and consulting services to natural gas, electric power and other energy and industrial end markets     6/2021     7.0 %   86.1     86.1  

Excelligence Learning Corporation(3)

  Developer, manufacturer and retailer of educational products     4/2023     8.5 %   147.5     123.9  

FS Squared Holding Corp.(3)(4)

  Provider of on-site vending and micro-market solutions to employers     3/2025     7.8 %   183.0     181.2  

Infogix, Inc.(3)(4)

  Enterprise data analytics and integrity software solutions provider     4/2024     8.6 %   126.5     126.5  

ISS Compressors Industries, Inc.

  Provider of repairs, refurbishments and services to the broader industrial end user markets     6/2020     9.8 %   76.2     76.2  

KeyImpact Holdings, Inc.(4)

  Foodservice sales and marketing agency     11/2021     8.6 %   74.6     74.6  

Nordco Inc.(3)

  Railroad maintenance-of-way machinery     8/2020     9.3 %   110.1     105.7  

Pegasus Intermediate Holdings, LLC(3)

  Provider of plant maintenance and scheduling software     11/2022     8.5 %   175.7     175.7  

Penn Detroit Diesel Allison, LLC

  Distributor of aftermarket parts to the heavy-duty truck industry     12/2021     8.7 %   78.2     78.2  

SM Wellness Holdings, Inc.(3)(4)

  Breast cancer screening provider     8/2024     8.0 %   212.4     212.4  

TDG Group Holding Company(3)(4)

  Operator of multiple franchise concepts primarily related to home maintenance or repairs     5/2024     8.1 %   248.2     248.2  

Towne Holdings, Inc.

  Parking management and hospitality services provider     5/2022     8.0 %   131.0     131.0  

Woodstream Group, Inc.(3)

  Pet products manufacturer     5/2022     9.0 %   197.6     197.6  

                  $ 3,321.5   $ 3,271.2  

(1)
Represents the weighted average annual stated interest rate as of March 31, 2019. All interest rates are payable in cash.

(2)
Represents the fair value in accordance with Accounting Standards Codification 820-10, Fair Value Measurements and Disclosures ("ASC 820"). The determination of such fair value is not included in our board of directors valuation process described elsewhere herein.

(3)
We also hold a portion of this company's first lien senior secured loan.

(4)
We hold an equity investment in this company.


SDLP Loan Portfolio as of December 31, 2018

(dollar amounts in millions)
Portfolio Company
  Business Description   Maturity
Date
  Stated
Interest
Rate(1)
  Principal
Amount
  Fair
Value(2)
 

42 North Dental, LLC (fka Gentle Communications, LLC)(3)

  Dental services provider     5/2022     8.4 %   126.8   $ 126.8  

ADCS Billings Intermediate Holdings, LLC(3)

  Dermatology practice     5/2022     8.3 %   78.6     76.3  

AEP Holdings, Inc.(3)(4)

  Distributor of non-discretionary, mission-critical aftermarket replacement parts     8/2021     8.5 %   160.0     156.8  

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(dollar amounts in millions)
Portfolio Company
  Business Description   Maturity
Date
  Stated
Interest
Rate(1)
  Principal
Amount
  Fair
Value(2)
 

BakeMark Holdings, Inc.(3)

  Manufacturer and distributor of specialty bakery ingredients     8/2023     7.8 %   247.8     247.7  

Center for Autism and Related Disorders, LLC(3)

  Autism treatment and services provider specializing in applied behavior analysis therapy     12/2022     6.5 %   119.0     117.8  

Chariot Acquisition, LLC(3)

  Aftermarket golf cart parts and accessories     9/2021     9.3 %   102.5     101.5  

Chesapeake Research Review, LLC(3)

  Provider of central institutional review boards over clinical trials     11/2023     8.6 %   198.4     198.4  

D4C Dental Brands, Inc.(3)

  Dental services provider     12/2022     9.0 %   161.1     161.1  

Emergency Communications Network, LLC(3)

  Provider of mission critical emergency mass notification solutions     6/2023     8.8 %   221.2     214.7  

EN Engineering, LLC(3)

  National utility services firm providing engineering and consulting services to natural gas, electric power and other energy and industrial end markets     6/2021     7.0 %   86.4     86.4  

Excelligence Holdings Corporation(3)

  Developer, manufacturer and retailer of educational products     4/2023     8.5 %   147.6     127.2  

Infogix, Inc.(3)(4)

  Enterprise data analytics and integrity software solutions provider     4/2024     8.8 %   126.8     126.8  

ISS Compressors Industries, Inc. 

  Provider of repairs, refurbishments and services to the broader industrial end user markets     6/2020     9.4 %   76.4     76.4  

KeyImpact Holdings, Inc.(4)

  Foodservice sales and marketing agency     11/2021     8.7 %   74.8     74.8  

Nordco Inc.(3)

  Railroad maintenance-of-way machinery     8/2020     8.9 %   110.1     105.7  

Pegasus Intermediate Holdings, LLC(3)

  Provider of plant maintenance and scheduling software     11/2022     8.5 %   176.2     176.2  

Penn Detroit Diesel Allison LLC

  Distributor of aftermarket parts to the heavy-duty truck industry     12/2021     8.8 %   78.4     78.4  

SM Wellness Holdings, Inc. and SM Holdco, Inc.(3)(4)

  Breast cancer screening provider     8/2024     8.0 %   213.0     211.9  

TDG Group Holding Company(3)(4)

  Operator of multiple franchise concepts primarily related to home maintenance or repairs     5/2024     8.3 %   248.8     246.3  

Towne Holdings, Inc. 

  Parking management and hospitality services provider     5/2022     7.8 %   131.3     131.3  

Woodstream Corporation(3)

  Pet products manufacturer     5/2022     8.9 %   201.0     200.9  

                  $ 3,086.2   $ 3,043.4  

(1)
Represents the weighted average annual stated interest rate as of December 31, 2018. All interest rates are payable in cash.

(2)
Represents the fair value in accordance with ASC 820-10. The determination of such fair value is not included in our board of directors valuation process described elsewhere herein.

(3)
We also hold a portion of this company's first lien senior secured loan.

(4)
We hold an equity investment in this company.

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RESULTS OF OPERATIONS

For the three months ended March 31, 2019 and 2018

              Operating results for the three months ended March 31, 2019 and 2018 were as follows:

 
  For the Three
Months Ended
March 31,
 
(in millions)
  2019   2018  

Total investment income

  $ 373   $ 317  

Total expenses, net of waiver of income based fees

    168     168  

Net investment income before income taxes

    205     149  

Income tax expense, including excise tax

    4     5  

Net investment income

    201     144  

Net realized gains (losses) on investments and foreign currency transactions

    56     (12 )

Net unrealized gains (losses) on investments, foreign currency and other transactions

    (43 )   110  

Net increase in stockholders' equity resulting from operations

  $ 214   $ 242  

              Net income can vary substantially from period to period due to various factors, including acquisitions, the level of new investment commitments, the recognition of realized gains and losses and unrealized appreciation and depreciation. As a result, comparisons of net increase in stockholders' equity resulting from operations may not be meaningful.

Investment Income

 
  For the Three
Months Ended
March 31,
 
(in millions)
  2019   2018  

Interest income from investments

  $ 289   $ 254  

Capital structuring service fees

    45     29  

Dividend income

    31     22  

Other income

    8     12  

Total investment income

  $ 373   $ 317  

              The increase in interest income from investments for the three months ended March 31, 2019 from the comparable period in 2018 was primarily due to an increase in the average size of our portfolio and an increase in the weighted average yield of our portfolio. The size of our portfolio increased from an average of $12.0 billion at amortized cost for the three months ended March 31, 2018 to an average of $13.1 billion at amortized cost for the comparable period in 2019. The weighted average yield at amortized cost of our portfolio increased from 8.8% for the three months ended March 31, 2018 to 9.4% for the comparable period in 2019. The increase in the weighted average yield at amortized cost was primarily due to an increase in LIBOR during the period. The increase in capital structuring service fees for the three months ended March 31, 2019 from the comparable period in 2018 was primarily due to the increase in the weighted average capital structuring service fees received on new investment commitments, which increased from 1.6% for the three months ended March 31, 2018 to 2.3% for the comparable period in 2019, as well as the increase in new investment commitments, which increased from $1.8 billion for the three months ended March 31, 2018 to $2.0 billion for the comparable period in 2019. Dividend income for the three months ended March 31,

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2019 and 2018 included dividends received from IHAM totaling $15 million and $13 million, respectively. Dividend income for the three months ended March 31, 2019 included other recurring dividends of $15 million compared to $6 million for the comparable period in 2018. The decrease in other income for the three months ended March 31, 2019 from the comparable period in 2018 was primarily attributable to lower amendment fees, partially offset by higher administrative agent fees and unfunded commitment fees for the three months ended March 31, 2019 from the comparable period in 2018.

Operating Expenses

 
  For the Three
Months Ended
March 31,
 
(in millions)
  2019   2018  

Interest and credit facility fees

  $ 67   $ 60  

Base management fees

    49     46  

Income based fees

    48     38  

Capital gains incentive fees

    2     20  

Administrative fees

    4     3  

Other general and administrative

    8     11  

Total operating expenses

    178     178  

Waiver of income based fees

    (10 )   (10 )

Total expenses, net of waiver of income based fees

  $ 168   $ 168  

              Interest and credit facility fees for the three months ended March 31, 2019 and 2018, were comprised of the following:

 
  For the Three
Months Ended
March 31,
 
(in millions)
  2019   2018  

Stated interest expense

  $ 60   $ 50  

Facility fees

    1     5  

Amortization of debt issuance costs

    4     4  

Net accretion of discount on notes payable

    2     1  

Total interest and credit facility fees

  $ 67   $ 60  

              Stated interest expense for the three months ended March 31, 2019 increased from the comparable period in 2018 primarily due to the increase in the average principal amount of debt outstanding. For the three months ended March 31, 2019, our average principal debt outstanding increased to $5.8 billion as compared to $4.9 billion for the comparable period in 2018. The weighted average stated interest rate on our outstanding debt was 4.1% for the three months ended March 31, 2019 as compared to 4.1% for the comparable period in 2018. Facility fees for the three months ended March 31, 2019 decreased from the comparable period in 2018 primarily due to the higher utilization of our revolving facilities resulting in lower unused commitment fees.

              The increase in base management fees for the three months ended March 31, 2019 from the comparable period in 2018 was primarily due to the increase in the average size of our portfolio for the three months ended March 31, 2019 compared to the comparable period in 2018. The increase in income based fees for the three months ended March 31, 2019 from the comparable periods in 2018 was primarily due to the pre-incentive fee net investment income, as defined in the investment advisory and management agreement, for the three months ended March 31, 2019 being higher than in the

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comparable period in 2018. The results for the three months ended March 31, 2019 and 2018 both reflect the Fee Waiver of $10 million.

              For the three months ended March 31, 2019 and 2018, the capital gains incentive fee calculated in accordance with GAAP was $2 million and $20 million, respectively. The capital gains incentive fee expense accrual for the three months ended March 31, 2019 changed from the comparable period in 2018 primarily due to the decrease in net gains on investments, foreign currency and other transactions for the three months ended March 31, 2019 to $13 million for the three months ended March 31, 2019 compared to $98 million for the three months ended March 31, 2018. The capital gains incentive fee accrued under GAAP includes an accrual related to unrealized capital appreciation, whereas the capital gains incentive fee actually payable under our investment advisory and management agreement does not. There can be no assurance that such unrealized capital appreciation will be realized in the future. The accrual for any capital gains incentive fee under GAAP in a given period may result in an additional expense if such cumulative amount is greater than in the prior period or a reduction of previously recorded expense if such cumulative amount is less than in the prior period. If such cumulative amount is negative, then there is no accrual. As of March 31, 2019, the total capital gains incentive fee accrual calculated in accordance with GAAP was $64 million. As of March 31, 2019, there was no capital gains incentive fee actually payable under our investment advisory and management agreement. See Note 3 to our consolidated financial statements for the three months ended March 31, 2019 for more information on the base management fees, income based fees and capital gains incentive fees.

              Administrative fees represent fees paid to Ares Operations for our allocable portion of overhead and other expenses incurred by Ares Operations in performing its obligations under the administration agreement, including our allocable portion of the compensation, rent and other expenses of certain of our executive officers and their respective staffs.

              Other general and administrative expenses includes, among other costs, professional fees, insurance, fees and expenses related to evaluating and making investments in portfolio companies and independent directors' fees.

Income Tax Expense, Including Excise Tax

              We have elected to be treated as a RIC under the Code and operate in a manner so as to qualify for the tax treatment applicable to RICs. To qualify as a RIC, we must (among other requirements) meet certain source-of-income and asset diversification requirements and timely distribute to our stockholders at least 90% of our investment company taxable income, as defined by the Code, for each year. We have made and intend to continue to make the requisite distributions to our stockholders, which will generally relieve us from U.S. federal corporate-level income taxes.

              Depending on the level of taxable income earned in a tax year, we may choose to carry forward such taxable income in excess of current year dividend distributions from such current year taxable income into the next tax year and pay a 4% excise tax on such income, as required. To the extent that we determine that our estimated current year taxable income will be in excess of estimated dividend distributions for the current year from such income, we accrue excise tax, if any, on estimated excess taxable income as such taxable income is earned. For the three months ended March 31, 2019 and 2018, we recorded a net expense of $4 million and $4 million, respectively, for U.S. federal excise tax.

              Certain of our consolidated subsidiaries are subject to U.S. federal and state income taxes. For the three months ended March 31, 2019 and 2018, we recorded a net tax expense of approximately $0 million and $1 million for these subsidiaries, respectively. The income tax expense for our taxable consolidated subsidiaries will vary depending on the level of realized gains from the exits of investments held by such taxable subsidiaries during the respective periods.

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Net Realized Gains/Losses

              The net realized gains from the sales, repayments or exits of investments during the three months ended March 31, 2019 and 2018 were comprised of the following:

 
  For the Three
Months Ended
March 31,
 
(in millions)
  2019   2018  

Sales, repayments or exits of investments(1)

  $ 1,286   $ 1,368  

Net realized gains on investments:

             

Gross realized gains

    10     11  

Gross realized losses

    (3 )   (11 )

Total net realized gains on investments

  $ 7   $  

(1)
Includes $287 million of investments sold to IHAM and certain vehicles managed by IHAM during the three months ended March 31, 2019. A net realized loss of $1 million was recorded on these transactions with IHAM during the three months ended March 31, 2019. See Note 4 to our consolidated financial statements for the three months ended March 31, 2019 for more detail on IHAM and its managed vehicles.

              The net realized gains (losses) on investments during the three months ended March 31, 2019 consisted of the following:

(in millions)
Portfolio Company
  Net Realized
Gains (Losses)
 

PDI TA Holdings, Inc.

  $ 4  

Other, net

    3  

Total

  $ 7  

              During the three months ended March 31, 2019, we recognized net realized gains on foreign currency transactions of $3 million. We also recognized a net realized gain of $46 million in connection with the receipt of a litigation judgment payment related to a former portfolio company of American Capital. See Note 14 to our consolidated financial statements for the three months ended March 31, 2019 for more information on the judgment.

              The net realized gains (losses) on investments during the three months ended March 31, 2018 consisted of the following:

(in millions)
Portfolio Company
  Net Realized
Gains (Losses)
 

EcoMotors, Inc.

  $ (9 )

Other, net

    9  

Total

  $  

              During the three months ended March 31, 2018, we recognized net realized losses on foreign currency transactions of $12 million.

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Net Unrealized Gains/Losses

              We value our portfolio investments quarterly and the changes in value are recorded as unrealized gains or losses in our consolidated statement of operations. Net unrealized gains and losses on investments for the three months ended March 31, 2019 and 2018 were comprised of the following:

 
  For the Three
Months Ended
March 31,
 
(in millions)
  2019   2018  

Unrealized appreciation

  $ 73   $ 181  

Unrealized depreciation

    (114 )   (97 )

Net unrealized (appreciation) depreciation reversed related to net realized gains or losses(1)

    2     12  

Total net unrealized gains (losses)

  $ (39 ) $ 96  

(1)
The net unrealized (appreciation) depreciation reversed related to net realized gains or losses represents the unrealized appreciation or depreciation recorded on the related asset at the end of the prior period.

              The changes in net unrealized appreciation and depreciation on investments during the three months ended March 31, 2019 consisted of the following:

(in millions)
Portfolio Company
  Net Unrealized
Appreciation
(Depreciation)
 

Ivy Hill Asset Management, L.P.

  $ 16  

American Academy Holdings, LLC

    8  

Soil Safe, Inc.

    5  

athenahealth, Inc.

    (5 )

New Trident Holdcorp, Inc.

    (5 )

Teasdale Foods, Inc.

    (5 )

Rug Doctor, LLC

    (7 )

Absolute Dental Management LLC

    (8 )

Alcami Corporation

    (8 )

Singer Sewing Company

    (8 )

Other, net

    (24 )

Total

  $ (41 )

              During the three months ended March 31, 2019, we also recognized net unrealized losses on foreign currency and other transactions of $4 million.

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              The changes in net unrealized appreciation and depreciation on investments during the three months ended March 31, 2018 consisted of the following:

(in millions)
Portfolio Company
  Net Unrealized
Appreciation
(Depreciation)
 

Alcami Holdings, LLC

  $ 87  

CCS Intermediate Holdings, LLC

    13  

Ivy Hill Asset Management, L.P.

    12  

Intermedix Corporation

    9  

Columbo MidCo Limited

    (4 )

Singer Sewing Company

    (8 )

Eckler Industries, Inc.

    (8 )

NECCO Holdings, Inc.

    (9 )

Instituto de Banca y Comercio, Inc.

    (9 )

Indra Holdings Corp.

    (9 )

Other, net

    10  

Total

  $ 84  

              During the three months ended March 31, 2018, we also recognized net unrealized gains on foreign currency and other transactions of $14 million.

For the years ended December 31, 2018, 2017 and 2016

              Operating results for the years ended December 31, 2018, 2017 and 2016 were as follows:

 
  For the Years Ended
December 31,
 
(in millions)
  2018   2017   2016  

Total investment income

  $ 1,337   $ 1,160   $ 1,012  

Total expenses, net of waiver of income based fees

    624     630     497  

Net investment income before income taxes

    713     530     515  

Income tax expense, including excise tax

    19     19     21  

Net investment income

    694     511     494  

Net realized gains on investments and foreign currency transactions

    419     24     110  

Net unrealized gains (losses) on investments, foreign currency and other transactions

    (255 )   136     (130 )

Realized losses on extinguishment of debt

        (4 )    

Net increase in stockholders' equity resulting from operations

  $ 858   $ 667   $ 474  

              Net income can vary substantially from period to period due to various factors, including acquisitions, the level of new investment commitments, the recognition of realized gains and losses and unrealized appreciation and depreciation. As a result, comparisons of net increase in stockholders' equity resulting from operations may not be meaningful.

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Investment Income

 
  For the Years Ended
December 31,
 
(in millions)
  2018   2017   2016  

Interest income from investments

  $ 1,041   $ 951   $ 806  

Capital structuring service fees

    143     105     99  

Dividend income

    97     76     75  

Other income

    56     28     32  

Total investment income

  $ 1,337   $ 1,160   $ 1,012  

              The increase in interest income from investments for the year ended December 31, 2018 from the comparable period in 2017 was primarily due to an increase in the average size of our portfolio and an increase in the weighted average yield of our portfolio. The size of our portfolio increased from an average of $11.4 billion at amortized cost for the year ended December 31, 2017 to an average of $11.9 billion at amortized cost for the comparable period in 2018. The weighted average yield of our total portfolio increased from 8.5% for the year ended December 31, 2017 to 9.0% for the comparable period in 2018 primarily due to an increase in LIBOR during the period. The increase in capital structuring service fees for the year ended December 31, 2018 from the comparable period in 2017 was primarily due to the increase in new investment commitments (excluding investments acquired in the American Capital Acquisition and investments acquired in the SSLP Loan Sale in 2017), which increased from $5.9 billion for year ended December 31, 2017 to $8.0 billion for the comparable period in 2018. The weighted average capital structuring fees received on new investment commitments remained steady at 1.8% for the year ended December 31, 2018 from the comparable period in 2017. Dividend income for the years ended December 31, 2018 and 2017 included dividends received from IHAM, a wholly owned portfolio company, totaling $58 million and $40 million, respectively. Also during the year ended December 31, 2018, we received $12 million in other non-recurring dividends from non-income producing equity securities compared to $19 million for the comparable period in 2017. The increase in other income for the year ended December 31, 2018 from the comparable period in 2017 was primarily due to higher amendment fees and administrative agent fees.

              The increase in interest income from investments for the year ended December 31, 2017 from the comparable period in 2016 was primarily due to an increase in the average size of our portfolio, partially offset by a decrease in the weighted average yield of our portfolio. The size of our portfolio increased from an average of $9.0 billion at amortized cost for the year ended December 31, 2016 to an average of $11.4 billion at amortized cost for the comparable period in 2017, which was largely due to the investments acquired as part of the American Capital Acquisition. The weighted average yield of our total portfolio decreased from 9.0% for the year ended December 31, 2016 to 8.5% for the comparable period in 2017. The decline in the weighted average yield was primarily due to the declining yield of the SSLP Certificates up until the SSLP made a liquidation distribution to the holders of the SSLP Certificates (the "SSLP Liquidation Distribution") and the effective termination of the SSLP, during the year ended December 31, 2017. The increase in capital structuring service fees for the year ended December 31, 2017 from the comparable period in 2016 was due to the increase in new investment commitments (excluding investments acquired from the American Capital Acquisition and investments acquired from the SSLP Loan Sale in 2017), which increased from $3.7 billion for year ended December 31, 2016 to $5.9 billion for the comparable period in 2017. This increase was partially offset by a decrease in weighted average capital structuring fees received on new investment commitments, which decreased from 2.7% for the year ended December 31, 2016 to 1.8% for the comparable period in 2017. This decline was primarily due to having a higher percentage of new investment commitments made to existing portfolio companies during the year ended December 31, 2017 as compared to the comparable period in 2016. Dividend income for the years ended

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December 31, 2017 and 2016 included dividends received from IHAM, a wholly owned portfolio company, totaling $40 million and $40 million, respectively. Also during the year ended December 31, 2017, we received $19 million in other non-recurring dividends from non-income producing equity securities compared to $20 million for the comparable period in 2016. The decrease in other income for the year ended December 31, 2017 from the comparable period in 2016 was primarily attributable to the decrease in sourcing fees from the SSLP for the year ended December 31, 2017 from the comparable period in 2016 resulting from the continued decrease in the size of the SSLP portfolio and eventually the effective termination of the SSLP in July 2017. This decrease was partially offset by higher amendment fees and administrative agent fees for the year ended December 31, 2017 from the comparable period in 2016.

Operating Expenses

 
  For the Years Ended
December 31,
 
(in millions)
  2018   2017   2016  

Interest and credit facility fees

  $ 240   $ 225   $ 186  

Base management fees

    180     171     137  

Income based fees

    169     134     123  

Capital gains incentive fees

    33     41     (5 )

Administrative fees

    13     12     14  

Professional fees and other costs related to the American Capital Acquisition

    3     45     15  

Other general and administrative

    26     32     27  

Total operating expenses

  $ 664   $ 660   $ 497  

Waiver of income based fees

    (40 )   (30 )    

Total expenses, net of waiver of income based fees

  $ 624   $ 630   $ 497  

              Interest and credit facility fees for the years ended December 31, 2018, 2017 and 2016, were comprised of the following:

 
  For the Years Ended
December 31,
 
(in millions)
  2018   2017   2016  

Stated interest expense

  $ 200   $ 189   $ 161  

Facility fees

    17     12     5  

Amortization of debt issuance costs

    18     18     14  

Net accretion of discount on notes payable

    5     6     6  

Total interest and credit facility fees

  $ 240   $ 225   $ 186  

              Stated interest expense for the year ended December 31, 2018 increased from the comparable period in 2017 primarily due to the increase in our average principal amount of debt outstanding. For the year ended December 31, 2018, our average debt outstanding increased to $4.8 billion as compared to $4.6 billion for the comparable period in 2017. The weighted average stated interest rate on our outstanding debt was 4.1% for both the year ended December 31, 2018 and for the comparable period in 2017. Facility fees for the year ended December 31, 2018 increased from the comparable period in 2017 primarily due to lower utilization of our revolving facilities resulting in higher unused commitment fees.

              Stated interest expense for the year ended December 31, 2017 increased from the comparable period in 2016 primarily due to the increase in our average principal amount of debt outstanding. For

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the year ended December 31, 2017, our average debt outstanding increased to $4.6 billion as compared to $3.9 billion for the comparable period in 2016, which was largely a result of the American Capital Acquisition. The weighted average stated interest rate on our outstanding debt was 4.1% for both the year ended December 31, 2017 and for the comparable period in 2016. Facility fees for the year ended December 31, 2017 increased from the comparable period in 2016 primarily due to the increased commitments under our revolving facilities resulting in higher unused commitment fees. Amortization of debt issuance costs for the year ended December 31, 2017 increased from the comparable period in 2016 primarily due to the increase in debt issuance costs in connection with the amendments to the Revolving Credit Facility and Revolving Funding Facility.

              The increase in base management fees for the year ended December 31, 2018 from the comparable period in 2017 was primarily due to the increase in the average size of the portfolio for the year ended December 31, 2018 as compared to the year ended December 31, 2017. The increase in base management fees for the year ended December 31, 2017 from the comparable period in 2016 was primarily due to the increase in the average size of the portfolio for the year ended December 31, 2017 (including the approximately $2.5 billion in investments acquired in the American Capital Acquisition) as compared to the year ended December 31, 2016. The increase in income based fees for the year ended December 31, 2018 from the comparable period in 2017 was primarily due to the pre-incentive fee net investment income, as defined in the investment advisory and management agreement, for the year ended December 31, 2018 being higher than in the comparable period in 2017. The increase in income based fees for the year ended December 31, 2017 from the comparable period in 2016 was primarily due to the pre-incentive fee net investment income, as defined in the investment advisory and management agreement, for the year ended December 31, 2017 being higher than in the comparable period in 2016. As discussed earlier, the years ended December 31, 2018 and 2017 also reflect the Fee Waiver of $40 million and $30 million, respectively.

              For the years ended December 31, 2018 and 2017, the capital gains incentive fee expense calculated in accordance with GAAP was $33 million and $41 million, respectively. The capital gains incentive fee expense accrual for the year ended December 31, 2017 included an $11 million accrual related to the American Capital Acquisition as a result of the fair value of the net assets acquired exceeding the fair value of the merger consideration paid by us. For the year ended December 31, 2016, the reduction in capital gains incentive fees calculated in accordance with GAAP was $5 million. The capital gains incentive fee expense accrual for the year ended December 31, 2018 changed from the comparable period in 2017 primarily due to the $11 million accrual related to the American Capital Acquisition during the year ended December 31, 2017 as discussed above, partially offset by higher net gains on investments, foreign currency and other transactions and the extinguishment of debt during the year ended December 31, 2018 of $164 million compared to net gains of $156 million during the year ended December 31, 2017. The capital gains incentive fee expense accrual for the year ended December 31, 2017 changed from the comparable period in 2016 primarily due to net gains on investments, foreign currency and other transactions and the extinguishment of debt during the year ended December 31, 2017 of $156 million compared to net losses of $20 million during the year ended December 31, 2016. The capital gains incentive fee accrued under GAAP includes an accrual related to unrealized capital appreciation, whereas the capital gains incentive fee actually payable under our investment advisory and management agreement does not. There can be no assurance that such unrealized capital appreciation will be realized in the future. The accrual for any capital gains incentive fee under GAAP in a given period may result in an additional expense if such cumulative amount is greater than in the prior period or a reduction of previously recorded expense if such cumulative amount is less than in the prior period. If such cumulative amount is negative, then there is no accrual. As of December 31, 2018, 2017 and 2016, the total capital gains incentive fee accrual calculated in accordance with GAAP was $112 million, $79 million and $38 million, respectively. As of December 31, 2018, the capital gains incentive fee actually payable under our investment advisory and management agreement was $50 million. As of December 31, 2017, there was no capital gains incentive fee actually

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payable under our investment advisory and management agreement. See Note 3 to our consolidated financial statements for the year ended December 31, 2018, for more information on the base management fees, income based fees and capital gains incentive fees.

              Administrative fees represent fees paid to Ares Operations for our allocable portion of overhead and other expenses incurred by Ares Operations in performing its obligations under the administration agreement, including our allocable portion of the compensation, rent and other expenses of certain of our executive officers and their respective staffs. Administrative fees incurred related specifically to the American Capital Acquisition are included in professional fees and other costs related to the American Capital Acquisition as discussed below.

              For the years ended December 31, 2018, 2017 and 2016, the Company incurred $3 million, $45 million and $15 million, respectively, in professional fees and other costs related to the American Capital Acquisition. For the year ended December 31, 2017, these costs also included $18 million in one-time investment banking fees incurred in January 2017 upon the closing of the American Capital Acquisition.

              Other general and administrative expenses includes, among other costs, professional fees, insurance, fees and expenses related to evaluating and making investments in portfolio companies and independent directors' fees.

Income Tax Expense, Including Excise Tax

              We have elected to be treated as a RIC under the Code and intend to operate so as to qualify for RIC status. To qualify as a RIC, we must generally (among other requirements) timely distribute to our stockholders at least 90% of our investment company taxable income, as defined by the Code, for each year. To maintain our RIC status, we have made and intend to continue to make the requisite distributions to our stockholders which will generally relieve us from U.S. federal corporate-level income taxes.

              Depending on the level of taxable income earned in a tax year, we may choose to carry forward such taxable income in excess of current year dividend distributions from such current year taxable income into the next tax year and pay a 4% excise tax on such income, as required. If we determine that our estimated current year taxable income will exceed our estimated dividend distributions for the current year from such income, we accrue excise tax on estimated excess taxable income as such taxable income is earned. For the years ended December 31, 2018, 2017 and 2016, we recorded a net expense of $14 million, $12 million and $12 million, respectively, for U.S. federal excise tax. The net expense for the years ended December 31, 2017 and 2016 each included a reduction in expense related to the recording of a requested refund resulting from the overpayment of the prior year's excise tax of $1 million and $1 million, respectively.

              Certain of our consolidated subsidiaries are subject to U.S. federal and state income taxes. For the years ended December 31, 2018, 2017 and 2016, we recorded a net tax expense of approximately $5 million, $7 million and $9 million, respectively, for these subsidiaries. The net income tax expense for our taxable consolidated subsidiaries will vary depending on the level of realized gains from the exits of investments held by such taxable subsidiaries during the respective periods.

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Net Realized Gains/Losses

              The net realized gains from the sales, repayments or exits of investments during the years ended December 31, 2018, 2017 and 2016 were comprised of the following:

 
  For the Years Ended
December 31,
 
(in millions)
  2018   2017   2016  

Sales, repayments or exits of investments(1)

  $ 6,780   $ 7,037 (2) $ 3,749 (3)

Net realized gains on investments:

                   

Gross realized gains

  $ 465   $ 281   $ 121  

Gross realized losses

    (59 )   (237 )   (11 )

Total net realized gains on investments

  $ 406 (4) $ 44 (4) $ 110  

(1)
Includes $472 million, $134 million and $472 million of investments sold to IHAM and certain vehicles managed by IHAM during the years ended December 31, 2018, 2017 and 2016, respectively. A net realized loss of $0 million was recorded on these transactions with IHAM during the year ended December 31, 2018. A net realized loss of $0 million was recorded on these transactions with IHAM during the year ended December 31, 2017. A net realized gain of $1 million was recorded on these transactions with IHAM for the year ended December 31, 2016. See Note 4 to our consolidated financial statements for the year ended December 31, 2018 for more detail on IHAM and its managed vehicles.

(2)
Includes the $1.5 billion of proceeds from the SSLP Liquidation Distribution discussed above.

(3)
Includes $474 million of investments sold to the SDLP in conjunction with the initial funding of the SDLP. No realized gains or losses were recorded on these transactions with the SDLP.

(4)
Includes approximately $342 million and $85 million of net realized gains on investments acquired as part of the American Capital Acquisition during the years ended December 31, 2018 and 2017, respectively.

              The net realized gains on investments during the year ended December 31, 2018 consisted of the following:

(in millions)
Portfolio Company
  Net Realized
Gains (Losses)
 

Alcami Holdings, LLC

  $ 324  

Accruent, LLC

    27  

Varsity Brands Holding Co., Inc. 

    14  

Imperial Capital Private Opportunities, LP

    12  

Acrisure, LLC

    8  

EcoMotors, Inc. 

    (9 )

Things Remembered, Inc. 

    (16 )

Other, net

    46  

Total, net

  $ 406  

              During the year ended December 31, 2018, we also recognized net realized gains on foreign currency and other transactions of $13 million.

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              The net realized gains on investments during the year ended December 31, 2017 consisted of the following:

(in millions)
Portfolio Company
  Net Realized
Gains (Losses)
 

Bellotto Holdings Limited

  $ 58  

10th Street, LLC

    34  

Community Education Centers, Inc. 

    24  

Tectum Holdings, Inc. 

    17  

American Broadband Holding Company

    15  

NECCO Realty Investments LLC

    13  

GHX Ultimate Parent Corporation

    11  

Wilcon Holdings LLC

    10  

La Paloma Generating Company, LLC

    (9 )

Pegasus Community Energy, LLC

    (9 )

The Greeley Company, Inc. 

    (12 )

Senior Secured Loan Fund LLC

    (18 )

Competitor Group, Inc. 

    (21 )

Infilaw Holding, LLC

    (140 )

Other, net

    71  

Total, net

  $ 44  

              During the year ended December 31, 2017, we also recognized net realized losses on foreign currency and other transactions of $20 million.

              During the year ended December 31, 2017, we redeemed the entire $183 million in aggregate principal amount outstanding of the unsecured notes that were scheduled to mature on October 1, 2022 (the "October 2022 Notes") in accordance with the terms of the indenture governing the October 2022 Notes. The October 2022 Notes bore interest at a rate of 5.875% per year, payable quarterly. The October 2022 Notes were redeemed at par plus accrued and unpaid interest for a total redemption price of approximately $185 million, which resulted in a realized loss on the extinguishment of debt of $4 million.

              The net realized gains on investments during the year ended December 31, 2016 consisted of the following:

(in millions)
Portfolio Company
  Net Realized
Gains (Losses)
 

The Step2 Company, LLC

  $ 18  

Napa Management Services Corporation

    16  

UL Holding Co., LLC

    13  

Physiotherapy Associates Holdings, Inc. 

    8  

Q9 Holdings Inc. 

    (9 )

Other, net

    64  

Total, net

  $ 110  

Net Unrealized Gains/Losses

              We value our portfolio investments quarterly and the changes in value are recorded as unrealized gains or losses in our consolidated statement of operations. Net unrealized gains and losses

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on investments for the years ended December 31, 2018, 2017 and 2016, were comprised of the following:

 
  For the Years Ended
December 31,
 
(in millions)
  2018   2017   2016  

Unrealized appreciation

  $ 137   $ 331   $ 168  

Unrealized depreciation

    (275 )   (301 )   (306 )

Net unrealized (appreciation) depreciation reversed related to net realized gains or losses(1)

    (133 )   113     13  

Total net unrealized gains (losses)

  $ (271 ) $ 143   $ (125 )

(1)
The net unrealized (appreciation) depreciation reversed related to net realized gains or losses represents the unrealized appreciation or depreciation recorded on the related asset at the end of the prior period.

              The changes in net unrealized appreciation and depreciation on investments during the year ended December 31, 2018 consisted of the following:

(in millions)
Portfolio Company
  Net Unrealized
Appreciation
(Depreciation)
 

OTG Management, LLC

  $ 25  

PERC Holdings 1 LLC

    11  

Absolute Dental Management LLC

    (9 )

SCM Insurance Services Inc. 

    (10 )

ADF Capital, Inc. 

    (11 )

Teasdale Foods, Inc. 

    (11 )

R3 Education Inc. 

    (12 )

Eckler Industries, Inc. 

    (13 )

Indra Holdings Corp. 

    (15 )

Singer Sewing Company

    (15 )

New Trident Holdcorp, Inc. 

    (49 )

Other, net

    (29 )

Total, net

  $ (138 )

              During the year ended December 31, 2018, we also recognized net unrealized gains on foreign currency and other transactions of $16 million.

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              The changes in net unrealized appreciation and depreciation on investments during the year ended December 31, 2017 consisted of the following:

(in millions)
Portfolio Company
  Net Unrealized
Appreciation
(Depreciation)
 

Alcami Holdings, LLC

  $ 167  

Ivy Hill Asset Management, L.P. 

    13  

Columbo MidCo Limited

    13  

CCS Intermediate Holdings, LLC

    12  

Imperial Capital Private Opportunities, LP

    11  

Ciena Capital LLC

    11  

Singer Sewing Company

    (9 )

Shock Doctor, Inc. 

    (9 )

Indra Holdings Corp. 

    (15 )

ADF Capital, Inc. 

    (16 )

Instituto de Banca y Comercio, Inc. 

    (23 )

New Trident Holdcorp, Inc. 

    (45 )

Other, net

    (80 )

Total, net

  $ 30  

              During the year ended December 31, 2017, we also recognized net unrealized losses on foreign currency and other transactions of $7 million.

              The changes in net unrealized appreciation and depreciation on investments during the year ended December 31, 2016 consisted of the following:

(in millions)
Portfolio Company
  Net Unrealized
Appreciation
(Depreciation)
 

Senior Secured Loan Fund LLC

  $ 26  

UL Holding Co., LLC

    20  

Community Education Centers, Inc. 

    19  

ADF Capital, Inc. 

    (9 )

10th Street, LLC

    (9 )

Indra Holdings Corp. 

    (11 )

CCS Intermediate Holdings, LLC

    (22 )

Instituto de Banca y Comercio, Inc. 

    (52 )

Infilaw Holdings, LLC

    (127 )

Other, net

    27  

Total, net

  $ (138 )

              During the year ended December 31, 2016, we also recognized net unrealized losses on foreign currency transactions of $5 million.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

              Our liquidity and capital resources are generated primarily from the net proceeds of public offerings of equity and debt securities, advances from the Revolving Credit Facility, the Revolving Funding Facility and the SMBC Funding Facility (each as defined below, and together, the "Facilities"), net proceeds from the issuance of other securities, including unsecured notes, as well as cash flows from operations.

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              As of March 31, 2019, we had $572 million in cash and cash equivalents and $6.3 billion in total aggregate principal amount of debt outstanding ($6.2 billion at carrying value). Subject to leverage, borrowing base and other restrictions, we had approximately $0.8 billion available for additional borrowings under the Facilities as of March 31, 2019.

              We may from time to time seek to retire or repurchase our common stock through cash purchases, as well as retire, cancel or purchase our outstanding debt through cash purchases and/or exchanges, in open market purchases, privately negotiated transactions or otherwise. Such purchases or exchanges, if any, will depend on prevailing market conditions, our liquidity requirements, contractual and regulatory restrictions and other factors. The amounts involved may be material. In addition, we may from time to time enter into additional debt facilities, increase the size of existing facilities or issue additional debt securities, including unsecured debt and/or debt securities convertible into common stock. Any such incurrence or issuance would be subject to prevailing market conditions, our liquidity requirements, contractual and regulatory restrictions and other factors. In accordance with the Investment Company Act, we are currently allowed to borrow amounts such that our asset coverage, calculated pursuant to the Investment Company Act, is at least 200% after such borrowings. On June 21, 2018, our board of directors, including a "required majority" (as such term is defined in Section 57(o) of the Investment Company Act) of our board of directors, approved the application of the modified asset coverage requirement set forth in Section 61(a)(2) of the Investment Company Act, as amended by the SBCAA. As a result, effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). As of March 31, 2019, the aggregate principal amount outstanding of the senior securities issued by us was $6.3 billion. As of March 31, 2019, our asset coverage was 215%.

Equity Capital Activities

              As of March 31, 2019 and December 31, 2018, our total equity market capitalization was $7.3 billion and $6.6 billion, respectively. There were no issuances of our equity securities during the three months ended March 31, 2019 and 2018.

              We are authorized under our stock repurchase program to purchase up to $500 million in the aggregate of our outstanding common stock in the open market at certain thresholds below our net asset value per share, in accordance with the guidelines specified in Rule 10b-18 under the Exchange Act. The timing, manner, price and amount of any share repurchases will be determined by us, in our discretion, based upon the evaluation of economic and market conditions, stock price, applicable legal and regulatory requirements and other factors. The program does not require us to repurchase any specific number of shares, and we cannot assure stockholders that any shares will be repurchased under the program. The expiration date of the stock repurchase program is February 15, 2020. The program may be suspended, extended, modified or discontinued at any time.

              As of March 31, 2019, we had repurchased a total of 0.5 million shares of our common stock in the open market under the stock repurchase program since its inception in September 2015, at an average price of $13.92 per share, including commissions paid, leaving approximately $493 million available for additional repurchases under the program. During the three months ended March 31, 2019, we did not repurchase any shares of our common stock under the stock repurchase program.

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Debt Capital Activities

              Our debt obligations consisted of the following as of March 31, 2019 and December 31, 2018:

 
  As of  
 
  March 31, 2019   December 31, 2018  
(in millions)
  Total
Aggregate
Principal
Amount
Available/
Outstanding(1)
  Principal
Amount
Outstanding
  Carrying
Value
  Total
Aggregate
Principal
Amount
Available/
Outstanding(1)
  Principal
Amount
Outstanding
  Carrying
Value
 

Revolving Credit Facility

  $ 2,133 (2) $ 1,997   $ 1,997   $ 2,133   $ 1,064   $ 1,064  

Revolving Funding Facility

    1,000     620     620     1,000     520     520  

SMBC Funding Facility

    400     105     105     400     245     245  

2019 Convertible Notes

                300     300     300 (3)

2022 Convertible Notes

    388     388     374 (3)   388     388     372 (3)

2024 Convertible Notes

    403     403     386 (3)           (3)

2020 Notes

    600     600     599 (4)   600     600     598 (4)

2022 Notes

    600     600     595 (5)   600     600     595 (5)

2023 Notes

    750     750     745 (6)   750     750     744 (6)

2025 Notes

    600     600     593 (7)   600     600     593 (7)

2047 Notes

    230     230     183 (8)   230     230     183 (8)

Total

  $ 7,104   $ 6,293   $ 6,197   $ 7,001   $ 5,297   $ 5,214  

(1)
Subject to borrowing base, leverage and other restrictions. Represents the total aggregate amount committed or outstanding, as applicable, under such instrument.

(2)
Provides for a feature that allows us, under certain circumstances, to increase the size of the Revolving Credit Facility (as defined below) to a maximum of $3.1 billion.

(3)
Represents the aggregate principal amount outstanding of the Convertible Unsecured Notes. As of March 31, 2019, the total unamortized debt issuance costs and the unaccreted discount for the 2022 Convertible Notes and the 2024 Convertible Notes were $14 million and $17 million, respectively. As of December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount for the 2019 Convertible Notes (as defined below) and the 2022 Convertible Notes were $0 million and $16 million, respectively.

(4)
Represents the aggregate principal amount outstanding of the 2020 Notes (as defined below) less unamortized debt issuance costs and the net unaccreted discount recorded upon the issuances of the 2020 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the net unaccreted discount were $1 million and $2 million, respectively.

(5)
Represents the aggregate principal amount outstanding of the 2022 Notes less unamortized debt issuance costs and the net unaccreted discount recorded upon the issuances of the 2022 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the net unaccreted discount were $5 million and $5 million, respectively.

(6)
Represents the aggregate principal amount outstanding of the 2023 Notes, less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2023 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount was $5 million and $6 million, respectively.

(7)
Represents the aggregate principal amount outstanding of the 2025 Notes, less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2025 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount was $7 million and $7 million, respectively.

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(8)
Represents the aggregate principal amount outstanding of the 2047 Notes (as defined below) less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2047 Notes. As of March 31, 2019 and December 31, 2018, the total unaccreted purchased discount was $47 million and $47 million, respectively.

              The weighted average stated interest rate and weighted average maturity, both on aggregate principal amount outstanding, of all our debt outstanding as of March 31, 2019 were 4.1% and 4.7 years, respectively, and as of December 31, 2018 were 4.1% and 4.8 years, respectively.

The ratio of total principal amount of debt outstanding to stockholders' equity as of March 31, 2019 was 0.86:1.00 compared to 0.73:1.00 as of December 31, 2018.

Revolving Credit Facility

              We are party to a senior secured revolving credit facility (as amended and restated, the "Revolving Credit Facility"), that as of March 31, 2019 allowed us to borrow up to $2.1 billion at any one time outstanding. As of March 31, 2019, the Revolving Credit Facility consisted of a $414 million term loan tranche with a stated maturity date of March 30, 2023 and a $1.7 billion revolving tranche. For $1.6 billion of the revolving tranche, the end of the revolving period and the stated maturity date was March 30, 2022 and March 30, 2023, respectively. For $50 million of the revolving tranche, the end of the revolving period and the stated maturity date was January 4, 2021 and January 4, 2022, respectively. For the remaining $45 million of the revolving tranche, the end of the revolving period and the stated maturity date was May 4, 2019 and May 4, 2020, respectively. The Revolving Credit Facility also provides for a feature that allows us, under certain circumstances, to increase the overall size of the Revolving Credit Facility to a maximum of $3.1 billion as of March 31, 2019. The interest rate charged on the Revolving Credit Facility is based on an applicable spread of either 1.75% or 1.875% over LIBOR or 0.75% or 0.875% over an "alternate base rate" (as defined in the agreements governing the Revolving Credit Facility), in each case, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. As of March 31, 2019, the interest rate in effect was LIBOR plus 1.75%. We are also required to pay a letter of credit fee of either 2.00% or 2.125% per annum on letters of credit issued, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. Additionally, we are required to pay a commitment fee of 0.375% per annum on any unused portion of the Revolving Credit Facility. As of March 31, 2019, there was $1,997 million outstanding under the Revolving Credit Facility and we were in compliance in all material respects with the terms of the Revolving Credit Facility. See "Recent Developments," as well as Note 15 to our consolidated financial statements for the three months ended March 31, 2019 for a subsequent event relating to the Revolving Credit Facility.

Revolving Funding Facility

              Our consolidated subsidiary, Ares Capital CP Funding LLC ("Ares Capital CP"), is party to the Revolving Funding Facility, which allows Ares Capital CP to borrow up to $1.0 billion at any one time outstanding. The Revolving Funding Facility is secured by all of the assets held by, and the membership interest in, Ares Capital CP. The end of the reinvestment period and the stated maturity date for the Revolving Funding Facility are January 3, 2022 and January 3, 2024, respectively. The interest rate charged on the Revolving Funding Facility is based on LIBOR plus 2.00% per annum or a "base rate" (as defined in the agreements governing the Revolving Funding Facility) plus 1.00% per annum. Ares Capital CP is also required to pay a commitment fee of between 0.50% and 1.50% per annum depending on the size of the unused portion of the Revolving Funding Facility. As of March 31, 2019,

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there was $620 million outstanding under the Revolving Funding Facility and we and Ares Capital CP were in compliance in all material respects with the terms of the Revolving Funding Facility.

SMBC Funding Facility

              Our consolidated subsidiary, Ares Capital JB Funding LLC ("ACJB"), is party to a revolving funding facility (as amended, the "SMBC Funding Facility") with ACJB, as the borrower, and Sumitomo Mitsui Banking Corporation ("SMBC"), as the administrative agent, collateral agent and lender, that allows ACJB to borrow up to $400 million at any one time outstanding. The SMBC Funding Facility is secured by all of the assets held by ACJB. The end of the reinvestment period and the stated maturity date for the SMBC Funding Facility are September 14, 2019 and September 14, 2024, respectively. The reinvestment period and the stated maturity date are both subject to two one-year extensions by mutual agreement. The interest rate charged on the SMBC Funding Facility is based on an applicable spread of either 1.75% or 2.00% over LIBOR or 0.75% or 1.00% over a "base rate" (as defined in the agreements governing the SMBC Funding Facility), in each case, determined monthly based on the amount of the average borrowings outstanding under the SMBC Funding Facility. As of March 31, 2019, the interest rate in effect was LIBOR plus 1.75%. ACJB is required to pay a commitment fee of between 0.35% and 0.875% per annum depending on the size of the unused portion of the SMBC Funding Facility. As of March 31, 2019, there was $105 million outstanding under the SMBC Funding Facility and we and ACJB were in compliance in all material respects with the terms of the SMBC Funding Facility.

Convertible Unsecured Notes

              We have issued $388 million in aggregate principal amount of unsecured convertible notes that mature on February 1, 2022 (the "2022 Convertible Notes") and $403 million in aggregate amount of unsecured convertible notes that mature on March 1, 2024 (the "2024 Convertible Notes" and together with the 2022 Convertible Notes, the "Convertible Unsecured Notes"). The Convertible Unsecured Notes mature upon their respective maturity dates unless previously converted or repurchased in accordance with their terms. We do not have the right to redeem the Convertible Unsecured Notes prior to maturity. The 2022 Convertible Notes and the 2024 Convertible Notes bear interest at a rate of 3.75% and 4.625%, respectively, per year, payable semi-annually.

              In certain circumstances, assuming the respective conversion date below has not already passed, the Convertible Unsecured Notes will be convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, at our election, at their respective conversion rates (listed below as of March 31, 2019) subject to customary anti-dilution adjustments and the requirements of their respective indenture (the "Convertible Unsecured Notes Indentures"). Prior to the close of business on the business day immediately preceding their respective conversion date (listed below), holders may convert their Convertible Unsecured Notes only under certain circumstances set forth in the Convertible Unsecured Notes Indentures. On or after their respective conversion dates until the close of business on the scheduled trading day immediately preceding the maturity date for the 2022 Convertible Notes and the second scheduled trading day immediately preceding the maturity date for the 2024 Convertible Notes, holders may convert their Convertible Unsecured Notes at any time. In addition, if we engage in certain corporate events as described in their respective Convertible Unsecured Notes Indenture, holders of the Convertible Unsecured Notes may require us to repurchase for cash all or part of the Convertible Unsecured Notes at a repurchase price equal to 100% of the principal amount of the Convertible Unsecured Notes to be repurchased, plus accrued and unpaid interest through, but excluding, the required repurchase date.

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              Certain key terms related to the convertible features for each of the Convertible Unsecured Notes as of March 31, 2019 are listed below.

 
  2022 Convertible
Notes
  2024 Convertible
Notes

Conversion premium

  15.0%   15.0%

Closing stock price at issuance

  $16.86   $17.29

Closing stock price date

  January 23, 2017   March 5, 2019

Conversion price(1)

  $19.32   $19.88

Conversion rate (shares per one thousand dollar principal amount)(1)

  51.7581   50.2930

Conversion dates

  August 1, 2021   December 1, 2023

(1)
Represents conversion price and conversion rate, as applicable, as of March 31, 2019, taking into account any applicable de minimis adjustments that will be made on the conversion date.

              In January 2019, we repaid in full the $300 million in aggregate principal amount of unsecured convertible notes due in January 2019 (the "2019 Convertible Notes") upon their maturity. The 2019 Convertible Notes bore interest at a rate of 4.375% per year, payable semi-annually.

Unsecured Notes

2020 Notes

              We have issued $600 million in aggregate principal amount of unsecured notes, which bear interest at a rate of 3.875% per year and mature on January 15, 2020 (the "2020 Notes"). The 2020 Notes require payment of interest semi-annually, and all principal is due upon maturity. These notes are redeemable in whole or in part at any time at our option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2020 Notes, and any accrued and unpaid interest.

2022 Notes

              We have issued $600 million in aggregate principal amount of unsecured notes, which bear interest at a rate of 3.625% per year and mature on January 19, 2022 (the "2022 Notes"). The 2022 Notes require payment of interest semi-annually, and all principal is due upon maturity. These notes are redeemable in whole or in part at any time at our option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2022 Notes, and any accrued and unpaid interest.

2023 Notes

              We have issued $750 million in aggregate principal amount of unsecured notes, that mature on February 10, 2023 (the "2023 Notes"). The 2023 Notes bear interest at a rate of 3.500% per year, payable semi annually and all principal is due upon maturity. The 2023 Notes may be redeemed in whole or in part at any time at our option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2023 Notes, and any accrued and unpaid interest.

2025 Notes

              We have issued $600 million in aggregate principal amount of unsecured notes that mature on March 1, 2025 (the "2025 Notes"). The 2025 Notes bear interest at a rate of 4.250% per year, payable semi-annually and all principal is due upon maturity. The 2025 Notes may be redeemed in whole or in

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part at any time at our option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2025 Notes, and any accrued and unpaid interest.

2047 Notes

              As part of the acquisition of Allied Capital Corporation (the "Allied Acquisition"), we assumed $230 million in aggregate principal amount of unsecured notes which bear interest at a rate of 6.875% and mature on April 15, 2047 (the "2047 Notes" and together with the 2020 Notes, the 2022 Notes, the 2023 Notes and the 2025 Notes, the "Unsecured Notes"). The 2047 Notes require payment of interest quarterly, and all principal is due upon maturity. These notes are redeemable in whole or in part at any time or from time to time at our option, at a par redemption price of $25.00 per security plus accrued and unpaid interest.

              As of March 31, 2019, we were in compliance in all material respects with the terms of the Convertible Unsecured Notes Indentures and the indentures governing the Unsecured Notes.

              The Convertible Unsecured Notes and the Unsecured Notes are our senior unsecured obligations and rank senior in right of payment to any future indebtedness that is expressly subordinated in right of payment to the Convertible Unsecured Notes and the Unsecured Notes; equal in right of payment to our existing and future unsecured indebtedness that is not expressly subordinated; effectively junior in right of payment to any of our secured indebtedness (including existing unsecured indebtedness that we later secure) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by our subsidiaries, financing vehicles or similar facilities.

              See Note 5 to our consolidated financial statements for the three months ended March 31, 2019 for more information on our debt obligations.

CONTRACTUAL OBLIGATIONS

              A summary of the maturities of our principal amounts of debt and other contractual payment obligations as of December 31, 2018 are as follows:

 
  Payments Due by Period  
(in millions)
  Total   Less than
1 year
  1-3 years   3-5 years   After
5 years
 

Revolving Credit Facility

  $ 1,064   $   $ 17   $ 1,047 (1) $  

Revolving Funding Facility

    520             — (2 )   520  

SMBC Funding Facility

    245                 245 (3)

2019 Convertible Notes

    300     300              

2022 Convertible Notes

    388             388      

2020 Notes

    600         600          

2022 Notes

    600             600      

2023 Notes

    750             750      

2025 Notes

    600                 600  

2047 Notes

    230                 230  

Operating lease obligations(4)

    159     25     48     49     37  

  $ 5,456   $ 325   $ 665   $ 2,834   $ 1,632  

(1)
The Revolving Credit Facility consists of a $414 million term loan tranche with a stated maturity date of March 30, 2023 and a $1,719 million revolving tranche. For $1,624 million of the revolving tranche, the end of the revolving period and the stated maturity date are March 30, 2022 and

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    March 30, 2023, respectively. For $50 million of the revolving tranche, the end of the revolving period and the stated maturity date are January 4, 2021 and January 4, 2022, respectively. For the remaining $45 million of the revolving tranche, the end of the revolving period and the stated maturity date are May 4, 2019 and May 4, 2020, respectively. We are required to repay any outstanding principal amounts under such revolving tranche on a monthly basis equal to 1/12th of the outstanding principal amount at the end of the revolving period.

(2)
As of December 31, 2018, the end of the reinvestment period for the Revolving Funding Facility was January 3, 2022. Subsequent to the end of this reinvestment period and prior to the stated maturity date of January 3, 2024, any principal proceeds from sales and repayments of loan assets held by Ares Capital CP will be used to repay the aggregate principal amount outstanding.

(3)
As of December 31, 2018, the end of the reinvestment period for the SMBC Funding Facility was September 14, 2019. Subsequent to the end of this reinvestment period and prior to the stated maturity date of September 14, 2024, any principal proceeds from sales and repayments of loan assets held by ACJB will be used to repay the aggregate principal amount outstanding.

(4)
We are obligated under a number of operating leases and subleases to pay for office spaces with terms ranging from less than one year to more than 5 years. See Note 7 to our consolidated financial statements for the year ended December 31, 2018 for more information on our lease obligations.

OFF BALANCE SHEET ARRANGEMENTS

              We have various commitments to fund investments in our portfolio, as described below.

              As of March 31, 2019 and December 31, 2018, we had the following commitments to fund various revolving and delayed draw senior secured and subordinated loans, including commitments to fund which are at (or substantially at) our discretion:

 
  As of    
 
(in millions)
  March 31,
2019
  December 31,
2018
 

Total revolving and delayed draw loan commitments

  $ 1,872   $ 1,915  

Less: drawn commitments

    (405 )   (377 )

Total undrawn commitments

    1,467     1,538  

Less: commitments substantially at our discretion

    (8 )   (6 )

Less: unavailable commitments due to borrowing base or other covenant restrictions

         

Total net adjusted undrawn revolving and delayed draw loan commitments

  $ 1,459   $ 1,532  

              Included within the total revolving and delayed draw loan commitments as of March 31, 2019 and December 31, 2018 were delayed draw loan commitments totaling $520 million and $627 million, respectively. Our commitment to fund delayed draw loans is triggered upon the satisfaction of certain pre-negotiated terms and conditions. Generally, the most significant and uncertain term requires the borrower to satisfy a specific use of proceeds covenant. The use of proceeds covenant typically requires the borrower to use the additional loans for the specific purpose of a permitted acquisition or permitted investment, for example. In addition to the use of proceeds covenant, the borrower is generally required to satisfy additional negotiated covenants (including specified leverage levels).

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              Also included within the total revolving and delayed draw loan commitments as of March 31, 2019 were commitments to issue up to $325 million in letters of credit through a financial intermediary on behalf of certain portfolio companies. As of March 31, 2019, we had $39 million in letters of credit issued and outstanding under these commitments on behalf of the portfolio companies. For all these letters of credit issued and outstanding, we would be required to make payments to third parties if the portfolio companies were to default on their related payment obligations. Of these letters of credit, $27 million expire in 2019 and $12 million expire in 2020. As of March 31, 2019, we recorded a liability of $1 million for certain letters of credit issued and outstanding and none of the other letters of credit issued and outstanding were recorded as a liability on our balance sheet as such other letters of credit are considered in the valuation of the investments in the portfolio company.

              We also have commitments to co-invest in the SDLP for our portion of the SDLP's commitments to fund delayed draw loans to certain portfolio companies of the SDLP. See "Senior Direct Lending Program" above and Note 4 to our consolidated financial statements for the three months ended March 31, 2019 for more information.

              As of March 31, 2019 and December 31, 2018, we were party to subscription agreements to fund equity investments in private equity investment partnerships as follows:

 
  As of    
 
(in millions)
  March 31,
2019
  December 31,
2018
 

Total private equity commitments

  $ 115   $ 114  

Less: funded private equity commitments

    (69 )   (73 )

Total unfunded private equity commitments

    46     41  

Less: private equity commitments substantially our discretion

    (46 )   (41 )

Total net adjusted unfunded private equity commitments

  $   $  

              In the ordinary course of business, we may sell certain of our investments to third party purchasers. In particular, in connection with the sale of certain controlled portfolio company equity investments (as well as certain other sales), we have, and may continue to do so in the future, agreed to indemnify such purchasers for future liabilities arising from the investments and the related sale transaction. Such indemnification provisions have given rise to liabilities in the past and may do so in the future.

              In addition, in the ordinary course of business, we may guarantee certain obligations in connection with our portfolio companies (in particular, certain controlled portfolio companies). Under these guarantee arrangements, payments may be required to be made to third parties if such guarantees are called upon or if the portfolio companies were to default on their related obligations, as applicable.

RECENT DEVELOPMENTS

              In April 2019, we amended and restated the Revolving Credit Facility to, among other things, (a) increase the total size under the Revolving Credit Facility from approximately $2.1 billion to approximately $3.4 billion, (b) increase the size of the letter of credit sub-facility from $150 million to $200 million, with our ability to increase incrementally by $75 million on an uncommitted basis, (c) extend the expiration of the revolving period with respect to all commitments of the lenders under the credit facility to March 30, 2023, during which period we, subject to certain conditions, may make borrowings under the credit facility, and (d) extend the stated maturity date with respect to all commitments of the lenders under the credit facility to March 30, 2024.

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              From April 1, 2019 through April 24, 2019, we made new investment commitments of approximately $183 million, of which $130 million were funded. Of these new commitments, 51% were in first lien senior secured loans, 48% were in second lien senior secured loans and 1% were in the subordinated certificates of the SDLP. Of the approximately $183 million of new investment commitments, 100% were floating rate. The weighted average yield of debt and other income producing securities funded during the period at amortized cost was 9.8%. We may seek to sell all or a portion of these new investment commitments, although there can be no assurance that we will be able to do so.

              From April 1, 2019 through April 24, 2019, we exited approximately $747 million of investment commitments. Of the total investment commitments, 88% were first lien senior secured loans, 11% were senior subordinated loans and 1% were other equity securities. Of the approximately $747 million of exited investment commitments, 99% were floating rate and 1% were non-interest bearing. The weighted average yield of debt and other income producing securities exited or repaid during the period at amortized cost was 9.3% and the weighted average yield on total investments exited or repaid during the period at amortized cost was 9.3%. On the approximately $747 million of investment commitments exited from April 1, 2019 through April 24, 2019, we recognized total net realized gains of approximately $14 million.

              In addition, as of April 24, 2019, we had an investment backlog and pipeline of approximately $1,055 million and $195 million, respectively. Investment backlog includes transactions approved by our investment adviser's investment committee and/or for which a formal mandate, letter of intent or a signed commitment have been issued, and therefore we believe are likely to close. Investment pipeline includes transactions where due diligence and analysis are in process, but no formal mandate, letter of intent or signed commitment have been issued. The consummation of any of the investments in this backlog and pipeline depends upon, among other things, one or more of the following: satisfactory completion of our due diligence investigation of the prospective portfolio company, our acceptance of the terms and structure of such investment and the execution and delivery of satisfactory transaction documentation. In addition, we may sell all or a portion of these investments and certain of these investments may result in the repayment of existing investments. We cannot assure you that we will make any of these investments or that we will sell all or any portion of these investments.

              On April 24, 2019, at an in-person meeting, our board of directors approved the form of Second Amended and Restated Advisory and Management Agreement to be entered into by us and our investment adviser, effective as of June 6, 2019. The Second Amended and Restated Advisory and Management Agreement will reduce the rate used in calculating the base management fee calculated thereunder from 1.50% to 1.00% per annum with respect to assets financed using leverage over 1.0x debt to equity.

              On April 24, 2019, our board of directors appointed (i) Lisa Morgan as Chief Compliance Officer of the Company, replacing Miriam Krieger who had served in such capacity since July 2011, and (ii) Miriam Krieger as Vice President of the Company.

CRITICAL ACCOUNTING POLICIES

              See Note 2 to our consolidated financial statements for the three months ended March 31, 2019, which describes our critical accounting policies.

Investments

              Investment transactions are recorded on the trade date. Realized gains or losses are measured by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries.

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Unrealized gains or losses primarily reflect the change in investment values, including the reversal of previously recorded unrealized gains or losses when gains or losses are realized.

              Investments for which market quotations are readily available are typically valued at such market quotations. In order to validate market quotations, we look at a number of factors to determine if the quotations are representative of fair value, including the source and nature of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available (i.e., substantially all of our investments) are valued at fair value as determined in good faith by our board of directors, based on, among other things, the input of our investment adviser, audit committee and independent third-party valuation firms that have been engaged at the direction of our board of directors to assist in the valuation of each portfolio investment without a readily available market quotation at least once during a trailing 12-month period (with certain de minimis exceptions) and under a valuation policy and a consistently applied valuation process. The valuation process is conducted at the end of each fiscal quarter, and a portion of our investment portfolio at fair value is subject to review by an independent valuation firm each quarter. In addition, our independent registered public accounting firm obtains an understanding of, and performs select procedures relating to, our investment valuation process within the context of performing the integrated audit.

              As part of the valuation process, we may take into account the following types of factors, if relevant, in determining the fair value of our investments: the enterprise value of a portfolio company (the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time), the nature and realizable value of any collateral, the portfolio company's ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company's securities to any similar publicly traded securities, changes in the interest rate environment and the credit markets, which may affect the price at which similar investments would trade in their principal markets and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate our valuation.

              Because there is not a readily available market value for most of the investments in our portfolio, we value substantially all of our portfolio investments at fair value as determined in good faith by our board of directors, as described herein. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of our investments may fluctuate from period to period. Additionally, the fair value of our investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that we may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we could realize significantly less than the value at which we have recorded it.

              In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected in the valuations currently assigned.

              Our board of directors undertakes a multi-step valuation process each quarter, as described below:

    Our quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals responsible for the portfolio investment in conjunction with our portfolio management team.

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    Preliminary valuations are reviewed and discussed with our investment adviser's management and investment professionals, and then valuation recommendations are presented to our board of directors.

    The audit committee of our board of directors reviews these valuations, as well as the input of third parties, including independent third-party valuation firms who have reviewed a portion of the investments in our portfolio at fair value.

    Our board of directors discusses valuations and ultimately determines the fair value of each investment in our portfolio without a readily available market quotation in good faith based on, among other things, the input of our investment adviser, audit committee and, where applicable, independent third-party valuation firms.

Fair Value of Financial Instruments

              We follow ASC 825-10, which provides companies the option to report selected financial assets and liabilities at fair value. ASC 825-10 also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect of the company's choice to use fair value on its earnings. ASC 825-10 also requires entities to display the fair value of the selected assets and liabilities on the face of the balance sheet. We have not elected the ASC 825-10 option to report selected financial assets and liabilities at fair value. With the exception of the line items entitled "other assets" and "debt," which are reported at amortized cost, all assets and liabilities approximate fair value on the balance sheet. The carrying value of the lines titled "interest receivable," "receivable for open trades," "payable for open trades," "accounts payable and other liabilities," "base management fees payable," "income based fees payable," "capital gains incentive fees payable" and "interest and facility fees payable" approximate fair value due to their short maturity.

              We also follow ASC 820-10, which expands the application of fair value accounting. ASC 820-10 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosure of fair value measurements. ASC 820-10 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires us to assume that the portfolio investment is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market, which may be a hypothetical market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. In accordance with ASC 820-10, we have considered its principal market as the market in which we exit our portfolio investments with the greatest volume and level of activity. ASC 820-10 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. In accordance with ASC 820-10, these inputs are summarized in the three broad levels listed below:

    Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access.

    Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

    Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

              In addition to using the above inputs in investment valuations, we continue to employ the net asset valuation policy approved by our board of directors that is consistent with ASC 820-10. Consistent with our valuation policy, we evaluate the source of inputs, including any markets in which our investments are trading (or any markets in which securities with similar attributes are trading), in

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determining fair value. Our valuation policy considers the fact that because there is not a readily available market value for most of the investments in our portfolio, the fair value of the investments must typically be determined using unobservable inputs.

              Our portfolio investments (other than as described below in the following paragraph) are typically valued using two different valuation techniques. The first valuation technique is an analysis of the enterprise value ("EV") of the portfolio company. Enterprise value means the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time. The primary method for determining EV uses a multiple analysis whereby appropriate multiples are applied to the portfolio company's EBITDA (generally defined as net income before net interest expense, income tax expense, depreciation and amortization). EBITDA multiples are typically determined based upon review of market comparable transactions and publicly traded comparable companies, if any. We may also employ other valuation multiples to determine EV, such as revenues or, in the case of certain portfolio companies in the power generation industry, kilowatt capacity. The second method for determining EV uses a discounted cash flow analysis whereby future expected cash flows of the portfolio company are discounted to determine a present value using estimated discount rates (typically a weighted average cost of capital based on costs of debt and equity consistent with current market conditions). The EV analysis is performed to determine the value of equity investments, the value of debt investments in portfolio companies where we have control or could gain control through an option or warrant security, and to determine if there is credit impairment for debt investments. If debt investments are credit impaired, an EV analysis may be used to value such debt investments; however, in addition to the methods outlined above, other methods such as a liquidation or wind-down analysis may be utilized to estimate enterprise value. The second valuation technique is a yield analysis, which is typically performed for non-credit impaired debt investments in portfolio companies where the we do not own a controlling equity position. To determine fair value using a yield analysis, a current price is imputed for the investment based upon an assessment of the expected market yield for a similarly structured investment with a similar level of risk. In the yield analysis, we consider the current contractual interest rate, the maturity and other terms of the investment relative to the risk of the company and the specific investment. A key determinant of risk, among other things, is the leverage through the investment relative to the enterprise value of the portfolio company. As debt investments held by us are substantially illiquid with no active transaction market, we depend on primary market data, including newly funded transactions, as well as secondary market data with respect to high yield debt instruments and syndicated loans, as inputs in determining the appropriate market yield, as applicable.

              For other portfolio investments such as investments in the SDLP Certificates, discounted cash flow analysis is the primary technique utilized to determine fair value. Expected future cash flows associated with the investment are discounted to determine a present value using a discount rate that reflects estimated market return requirements.

              See Note 8 to our consolidated financial statements for the three months ended March 31, 2019 for more information on our valuation process.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

              We are subject to financial market risks, including changes in interest rates and the valuations of our investment portfolio.

Interest Rate Risk

              Interest rate sensitivity refers to the change in our earnings that may result from changes in the level of interest rates. Because we fund a portion of our investments with borrowings, our net investment income is affected by the difference between the rate at which we invest and the rate at

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which we borrow. As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income.

              As of March 31, 2019, 85% of the investments at fair value in our portfolio bore interest at variable rates, 6% bore interest at fixed rates, 9% were non-interest earning and 0% were on non-accrual status. Additionally, for the variable rate investments, 100% of these investments contained interest rate floors (representing 85% of total investments at fair value). Also, as of March 31, 2019, all the loans made through the SDLP contained interest rate floors. The Facilities all bear interest at variable rates with no interest rate floors, while the Unsecured Notes and the Convertible Unsecured Notes bear interest at fixed rates.

              We regularly measure our exposure to interest rate risk. We assess interest rate risk and manage our interest rate exposure on an ongoing basis by comparing our interest rate sensitive assets to our interest rate sensitive liabilities. Based on that review, we determine whether or not any hedging transactions are necessary to mitigate exposure to changes in interest rates.

              In December 2017, in connection with $395 million of the term loan tranche of our Revolving Credit Facility, we entered into a three-year interest rate swap agreement for a total notional amount of $395 million. Under the interest rate swap agreement, we pay a fixed interest rate of 2.06% and receive a floating rate based on the prevailing one-month LIBOR. See Note 5 to our consolidated financial statements for the three months ended March 31, 2019 for more information on the Revolving Credit Facility and see Note 6 to our consolidated financial statements for the three months ended March 31, 2019 for more information on the interest rate swap.

              The below sensitivity analyses do not include our collateralized loan obligation ("CLO") equity investments. CLO equity investments are levered structures that are collateralized primarily with first lien floating rate loans that may have LIBOR floors and are levered primarily with floating rate debt that does not have a LIBOR floor. The residual cash flows available to the equity holders of the CLOs will decline as interest rates increase until interest rates surpass the LIBOR floors on the floating rate loans. However, the revenue recognized on our CLO equity investments is calculated using the effective interest method which incorporates a forward LIBOR curve in the projected cash flows. Any change to interest rates that is not in-line with the forward LIBOR curve used in the projections, in either the timing or magnitude of the change, will cause actual distributions to differ from the current projections and will impact the related revenue recognized from these investments.

              Based on our March 31, 2019, balance sheet, the following table shows the annual impact on net income of base rate changes in interest rates (considering interest rate floors for variable rate instruments) assuming no changes in our investment and borrowing structure and reflecting the effect of our interest rate swap agreement discussed in the paragraph above:

(in millions)
Basis Point Change
  Interest
Income
  Interest
Expense(1)
  Net
Income(2)
 

Up 300 basis points

  $ 324   $ 70   $ 254  

Up 200 basis points

  $ 220   $ 47   $ 173  

Up 100 basis points

  $ 110   $ 23   $ 87  

Down 100 basis points

  $ (110 ) $ (23 ) $ (87 )

Down 200 basis points

  $ (171 ) $ (47 ) $ (124 )

Down 300 basis points

  $ (163 ) $ (58 ) $ (105 )

(1)
Includes the impact of the interest rate swap (discussed above) as a result of changes in interest rates.

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(2)
Excludes the impact of income based fees. See Note 3 to our consolidated financial statements for the three months ended March 31, 2019 for more information on the income based fees.

              Based on our December 31, 2018 balance sheet, the following table shows the annual impact on net income of base rate changes in interest rates (considering interest rate floors for variable rate instruments) assuming no changes in our investment and borrowing structure and reflecting the effect of our interest rate swap agreement discussed in the paragraph above:

(in millions)
Basis Point Change
  Interest
Income
  Interest
Expense(1)
  Net
Income(2)
 

Up 300 basis points

  $ 316   $ 43   $ 273  

Up 200 basis points

  $ 214   $ 29   $ 185  

Up 100 basis points

  $ 107   $ 14   $ 93  

Down 100 basis points

  $ (107 ) $ (14 ) $ (93 )

Down 200 basis points

  $ (188 ) $ (29 ) $ (159 )

Down 300 basis points

  $ (173 ) $ (36 ) $ (137 )

(1)
Includes the impact of the interest rate swap (discussed above) as a result of changes in interest rates.

(2)
Excludes the impact of income based fees. See Note 3 to our consolidated financial statements for the three months ended March 31, 2019 for more information on the income based fees.

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SENIOR SECURITIES
(dollar amounts in thousands, except per unit data)

              Information about our senior securities (including preferred stock, debt securities and other indebtedness) is shown in the following tables as of the end of the last ten fiscal years and as of March 31, 2019. The report of our independent registered public accounting firm, KPMG LLP, on the senior securities table as of December 31, 2018, is attached as an exhibit to the registration statement of which this prospectus is a part. The "—"indicates information that the SEC expressly does not require to be disclosed for certain types of senior securities.

Class and Year
  Total Amount
Outstanding
Exclusive of
Treasury
Securities(1)
  Asset
Coverage
Per Unit(2)
  Involuntary
Liquidating
Preference
Per Unit(3)
  Average
Market Value
Per Unit(4)
 

Revolving Credit Facility

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 1,997,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 1,063,750   $ 2,362   $     N/A  

Fiscal 2017

  $ 395,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 571,053   $ 2,296   $     N/A  

Fiscal 2015

  $ 515,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 170,000   $ 2,292   $     N/A  

Fiscal 2013

  $   $   $     N/A  

Fiscal 2012

  $   $   $     N/A  

Fiscal 2011

  $ 395,000   $ 2,393   $     N/A  

Fiscal 2010

  $ 146,000   $ 3,079   $     N/A  

Fiscal 2009

  $ 474,144   $ 2,294   $     N/A  

Revolving Funding Facility

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 620,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 520,000   $ 2,362   $     N/A  

Fiscal 2017

  $ 600,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 155,000   $ 2,296   $     N/A  

Fiscal 2015

  $ 250,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 324,000   $ 2,292   $     N/A  

Fiscal 2013

  $ 185,000   $ 2,547   $     N/A  

Fiscal 2012

  $ 300,000   $ 2,721   $     N/A  

Fiscal 2011

  $ 463,000   $ 2,393   $     N/A  

Fiscal 2010

  $ 242,050   $ 3,079   $     N/A  

Fiscal 2009

  $ 221,569   $ 2,294   $     N/A  

Revolving Funding II Facility

                         

Fiscal 2009

  $   $   $     N/A  

SMBC Revolving Funding Facility

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 105,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 245,000   $ 2,362   $     N/A  

Fiscal 2017

  $ 60,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 105,000   $ 2,296   $     N/A  

Fiscal 2015

  $ 110,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 62,000   $ 2,292   $     N/A  

Fiscal 2013

  $   $   $     N/A  

Fiscal 2012

  $   $   $     N/A  

SBA Debentures

                         

Fiscal 2017

  $   $   $     N/A  

Fiscal 2016

  $ 25,000   $ 2,296   $     N/A  

Fiscal 2015

  $ 22,000   $ 2,213   $     N/A  

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Class and Year
  Total Amount
Outstanding
Exclusive of
Treasury
Securities(1)
  Asset
Coverage
Per Unit(2)
  Involuntary
Liquidating
Preference
Per Unit(3)
  Average
Market Value
Per Unit(4)
 

Debt Securitization

                         

Fiscal 2011

  $ 77,531   $ 2,393   $     N/A  

Fiscal 2010

  $ 155,297   $ 3,079   $     N/A  

Fiscal 2009

  $ 273,752   $ 2,294   $     N/A  

February 2016 Convertible Notes

                         

Fiscal 2015

  $ 575,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 575,000   $ 2,292   $     N/A  

Fiscal 2013

  $ 575,000   $ 2,547   $     N/A  

Fiscal 2012

  $ 575,000   $ 2,721   $     N/A  

Fiscal 2011

  $ 575,000   $ 2,393   $     N/A  

June 2016 Convertible Notes

                         

Fiscal 2015

  $ 230,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 230,000   $ 2,292   $     N/A  

Fiscal 2013

  $ 230,000   $ 2,547   $     N/A  

Fiscal 2012

  $ 230,000   $ 2,721   $     N/A  

Fiscal 2011

  $ 230,000   $ 2,393   $     N/A  

2017 Convertible Notes

                         

Fiscal 2016

  $ 162,500   $ 2,296   $     N/A  

Fiscal 2015

  $ 162,500   $ 2,213   $     N/A  

Fiscal 2014

  $ 162,500   $ 2,292   $     N/A  

Fiscal 2013

  $ 162,500   $ 2,547   $     N/A  

Fiscal 2012

  $ 162,500   $ 2,721   $     N/A  

2018 Convertible Notes

                         

Fiscal 2017

  $ 270,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 270,000   $ 2,296   $     N/A  

Fiscal 2015

  $ 270,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 270,000   $ 2,292   $     N/A  

Fiscal 2013

  $ 270,000   $ 2,547   $     N/A  

Fiscal 2012

  $ 270,000   $ 2,721   $     N/A  

2019 Convertible Notes

                         

Fiscal 2018

  $ 300,000   $ 2,362   $     N/A  

Fiscal 2017

  $ 300,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 300,000   $ 2,296   $     N/A  

Fiscal 2015

  $ 300,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 300,000   $ 2,292   $     N/A  

Fiscal 2013

  $ 300,000   $ 2,547   $     N/A  

2022 Convertible Notes

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 388,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 388,000   $ 2,362   $     N/A  

Fiscal 2017

  $ 388,000   $ 2,415   $     N/A  

2024 Convertible Notes

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 402,500   $ 2,151   $     N/A  

2011 Notes

                         

Fiscal 2010

  $ 300,584   $ 3,079   $   $ 1,018  

2012 Notes

                         

Fiscal 2010

  $ 161,210   $ 3,079   $   $ 1,018  

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Class and Year
  Total Amount
Outstanding
Exclusive of
Treasury
Securities(1)
  Asset
Coverage
Per Unit(2)
  Involuntary
Liquidating
Preference
Per Unit(3)
  Average
Market Value
Per Unit(4)
 

2018 Notes

                         

Fiscal 2017

  $ 750,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 750,000   $ 2,296   $     N/A  

Fiscal 2015

  $ 750,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 750,000   $ 2,292   $     N/A  

Fiscal 2013

  $ 600,000   $ 2,547   $     N/A  

2020 Notes

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 600,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 600,000   $ 2,362   $     N/A  

Fiscal 2017

  $ 600,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 600,000   $ 2,296   $     N/A  

Fiscal 2015

  $ 600,000   $ 2,213   $     N/A  

Fiscal 2014

  $ 400,000   $ 2,292   $     N/A  

2022 Notes

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 600,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 600,000   $ 2,362   $     N/A  

Fiscal 2017

  $ 600,000   $ 2,415   $     N/A  

Fiscal 2016

  $ 600,000   $ 2,296   $     N/A  

February 2022 Notes

                         

Fiscal 2014

  $ 143,750   $ 2,292   $   $ 1,024  

Fiscal 2013

  $ 143,750   $ 2,547   $   $ 1,043  

Fiscal 2012

  $ 143,750   $ 2,721   $   $ 1,035  

October 2022 Notes

                         

Fiscal 2016

  $ 182,500   $ 2,296   $   $ 1,017  

Fiscal 2015

  $ 182,500   $ 2,213   $   $ 1,011  

Fiscal 2014

  $ 182,500   $ 2,292   $   $ 1,013  

Fiscal 2013

  $ 182,500   $ 2,547   $   $ 993  

Fiscal 2012

  $ 182,500   $ 2,721   $   $ 986  

2040 Notes

                         

Fiscal 2014

  $ 200,000   $ 2,292   $   $ 1,040  

Fiscal 2013

  $ 200,000   $ 2,547   $   $ 1,038  

Fiscal 2012

  $ 200,000   $ 2,721   $   $ 1,041  

Fiscal 2011

  $ 200,000   $ 2,393   $   $ 984  

Fiscal 2010

  $ 200,000   $ 3,079   $   $ 952  

2023 Notes

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 750,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 750,000   $ 2,362   $     N/A  

Fiscal 2017

  $ 750,000   $ 2,415   $     N/A  

2025 Notes

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 600,000   $ 2,151   $     N/A  

Fiscal 2018

  $ 600,000   $ 2,362   $     N/A  

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Class and Year
  Total Amount
Outstanding
Exclusive of
Treasury
Securities(1)
  Asset
Coverage
Per Unit(2)
  Involuntary
Liquidating
Preference
Per Unit(3)
  Average
Market Value
Per Unit(4)
 

2047 Notes

                         

Fiscal 2019 (as of March 31, 2019, unaudited)

  $ 229,557   $ 2,151   $   $ 1,013  

Fiscal 2018

  $ 229,557   $ 2,362   $   $ 1,013  

Fiscal 2017

  $ 229,557   $ 2,415   $   $ 1,021  

Fiscal 2016

  $ 229,557   $ 2,296   $   $ 1,015  

Fiscal 2015

  $ 229,557   $ 2,213   $   $ 1,011  

Fiscal 2014

  $ 229,557   $ 2,292   $   $ 985  

Fiscal 2013

  $ 230,000   $ 2,547   $   $ 972  

Fiscal 2012

  $ 230,000   $ 2,721   $   $ 978  

Fiscal 2011

  $ 230,000   $ 2,393   $   $ 917  

Fiscal 2010

  $ 230,000   $ 3,079   $   $ 847  

(1)
Total amount of each class of senior securities outstanding at principal value at the end of the period presented.

(2)
The asset coverage ratio for a class of senior securities representing indebtedness is calculated as our consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by total senior securities representing indebtedness. This asset coverage ratio is multiplied by $1,000 to determine the "Asset Coverage Per Unit" (including for the February 2022 Notes, the October 2022 Notes, the 2040 Notes and the 2047 Notes, which were issued in $25 increments). In June 2016, Ares Capital received exemptive relief from the SEC allowing it to modify the asset coverage requirements to exclude SBA Debentures from this calculation. As such, the asset coverage ratio beginning with Fiscal 2016 excludes the SBA Debentures. Certain prior year amounts have been reclassified to conform to the 2016 and 2017 presentation. In particular, unamortized debt issuance costs were previously included in other assets and were reclassified to long-term debt as a result of the adoption of ASU 2015-03, Interest—Imputation of Interest (Topic 835): Simplifying the Presentation of Debt Issuance Costs during the first quarter of 2016.

(3)
The amount to which such class of senior security would be entitled upon our involuntary liquidation in preference to any security junior to it.

(4)
Not applicable, except for with respect to the 2011 Notes, the 2012 Notes, the February 2022 Notes, the October 2022 Notes, the 2040 Notes and the 2047 Notes, as other senior securities are not registered for public trading on a stock exchange. The average market value per unit for each of the 2011 Notes, the 2012 Notes, the February 2022 Notes, the October 2022 Notes, the 2040 Notes and the 2047 Notes is based on the average daily prices of such notes and is expressed per $1,000 of indebtedness (including for the February 2022 Notes, the October 2022 Notes, the 2040 Notes and the 2047 Notes, which were issued in $25 increments).

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BUSINESS

Ares Capital

              Ares Capital, a Maryland corporation, is a specialty finance company that is a closed-end, non-diversified management investment company. We have elected to be regulated as a BDC under the Investment Company Act. We were founded on April 16, 2004, were initially funded on June 23, 2004 and completed our IPO on October 8, 2004. As of March 31, 2019, we were the largest BDC in the United States with approximately $14.0 billion of total assets.

              We are externally managed by our investment adviser, Ares Capital Management, a subsidiary of Ares Management, a publicly traded, leading global alternative asset manager, pursuant to our investment advisory and management agreement. Our administrator, Ares Operations, a subsidiary of Ares Management, provides certain administrative and other services necessary for us to operate.

              Our investment objective is to generate both current income and capital appreciation through debt and equity investments. We invest primarily in U.S. middle-market companies, where we believe the supply of primary capital is limited and the investment opportunities are most attractive. However, we may from time to time invest in larger or smaller companies. We generally use the term "middle-market" to refer to companies with annual EBITDA between $10 million and $250 million. As used herein, EBITDA represents net income before net interest expense, income tax expense, depreciation and amortization.

              We invest primarily in first lien senior secured loans (including "unitranche" loans, which are loans that combine both senior and mezzanine debt, generally in a first lien position), second lien senior secured loans and mezzanine debt, which in some cases includes an equity component. First and second lien senior secured loans generally are senior debt instruments that rank ahead of subordinated debt of a given portfolio company. Mezzanine debt is subordinated to senior loans and is generally unsecured. Our investments in corporate borrowers generally range between $30 million and $500 million each and, investments in project finance/power generation projects generally range between $10 million and $200 million. However, the investment sizes may be more or less than these ranges and may vary based on, among other things, our capital availability, the composition of our portfolio and general micro-and macro-economic factors.

              To a lesser extent, we also make preferred and/or common equity investments, which have generally been non-control equity investments of less than $20 million (usually in conjunction with a concurrent debt investment). However, we may increase the size or change the nature of these investments.

              The proportion of these types of investments will change over time given our views on, among other things, the economic and credit environment in which we are operating. In pursuit of our investment objective we generally seek to self-originate investments and lead the investment process, which may result in us making commitments with respect to indebtedness or securities of a potential portfolio company in excess of our final investment. In such situations, while we may initially agree to fund up to a certain dollar amount of an investment, we may subsequently syndicate or sell a portion of such amount (including, without limitation, to vehicles managed by our portfolio company, IHAM), such that we are left with a smaller investment than what was reflected in our original commitment. In addition to originating investments, we may also acquire investments in the secondary market (including purchases of a portfolio of investments).

              The first and second lien senior secured loans in which we invest generally have stated terms of three to 10 years and the mezzanine debt investments in which we invest generally have stated terms of up to 10 years, but the expected average life of such first and second lien loans and mezzanine debt is generally between three and seven years. However, we may invest in loans and securities with any maturity or duration. The instruments in which we invest typically are not rated by any rating agency,

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but we believe that if such instruments were rated, they would be below investment grade (rated lower than "Baa3" by Moody's Investors Service, lower than "BBB–" by Fitch Ratings or lower than "BBB–" by Standard & Poor's Ratings Services), which, under the guidelines established by these entities, is an indication of having predominantly speculative characteristics with respect to the issuer's capacity to pay interest and repay principal. Bonds that are rated below investment grade are sometimes referred to as "high yield bonds" or "junk bonds." We may invest without limit in debt or other securities of any rating, as well as debt or other securities that have not been rated by any nationally recognized statistical rating organization.

              We believe that our investment adviser, Ares Capital Management, is able to leverage the current investment platform, resources and existing relationships of Ares with financial sponsors, financial institutions, hedge funds and other investment firms to provide us with attractive investment opportunities. In addition to deal flow, the Ares investment platform assists our investment adviser in analyzing, structuring and monitoring investments. Ares has been in existence for over 20 years and its partners have an average of approximately 24 years of experience in leveraged finance, private equity, distressed debt, commercial real estate finance, investment banking and capital markets. We have access to Ares' investment professionals and administrative professionals, who provide assistance in accounting, finance, legal, compliance, operations, information technology and investor relations. As of March 31, 2019, Ares had approximately 420 investment professionals and approximately 650 administrative professionals.

              While our primary focus is to generate current income and capital appreciation through investments in first and second lien senior secured loans and mezzanine debt and, to a lesser extent, equity securities of eligible portfolio companies, we also may invest up to 30% of our portfolio in non-qualifying assets, as permitted by the Investment Company Act. Specifically, as part of this 30% basket, we may invest in entities that are not considered "eligible portfolio companies" (as defined in the Investment Company Act), including companies located outside of the United States, entities that are operating pursuant to certain exceptions under the Investment Company Act, and publicly traded entities whose public equity market capitalization exceeds the levels provided for under the Investment Company Act.

Ares Management Corporation

              Ares is a publicly traded, leading global alternative asset manager. As of March 31, 2019, Ares had over 1,000 employees in over 15 principal and originating offices across the United States, Europe, Asia and Australia. Since its inception in 1997, Ares has adhered to a disciplined investment philosophy that focuses on delivering strong risk-adjusted investment returns throughout market cycles. Ares believes each of its three distinct but complementary investment groups in Credit, Private Equity and Real Estate is a market leader based on investment performance. Ares was built upon the fundamental principle that each group benefits from being part of the greater whole.

Ares Capital Management LLC

              Ares Capital Management, our investment adviser, is served by an origination, investment and portfolio management team of approximately 105 U.S.-based investment professionals as of March 31, 2019 and led by certain partners of the Ares Credit Group: Kipp deVeer, Mitchell Goldstein and Michael Smith. Ares Capital Management leverages off of Ares' investment platform and benefits from the significant capital markets, trading and research expertise of Ares' investment professionals. Ares Capital Management's investment committee has eight members primarily comprised of certain of the U.S.-based partners of the Ares Credit Group.

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MARKET OPPORTUNITY

              We believe that current market conditions present attractive opportunities for us to invest in middle-market companies, specifically:

    We believe that many commercial and investment banks have, in recent years, de-emphasized their service and product offerings to middle-market businesses in favor of lending to large corporate clients and managing capital markets transactions. In addition, these lenders may be constrained in their ability to underwrite and hold bank loans and high yield securities for middle-market issuers as they seek to meet existing and future regulatory capital requirements. These factors may result in opportunities for alternative funding sources to middle-market companies and therefore more new-issue market opportunities for us.

    We believe disruption and volatility that occurs periodically in the credit markets, reduces capital available to certain capital providers, causing a reduction in competition. When these volatile market conditions occur, they often create opportunities to achieve attractive risk-adjusted returns.

    We believe that there is a lack of market participants that are willing to hold meaningful amounts of certain middle-market loans. As a result, we believe our ability to minimize syndication risk for a company seeking financing by being able to hold our loans without having to syndicate or sell them is a competitive advantage.

    We believe that middle-market companies have faced difficulty in raising debt through the capital markets. This approach to financing may become more difficult to the extent institutional investors seek to invest in larger, more liquid offerings, leaving less competition and fewer financing alternatives for middle-market companies.

    We believe there is a large pool of un-invested private equity capital for middle-market businesses. We expect private equity firms will seek to leverage their investments by combining equity capital with senior secured loans and mezzanine debt from other sources such as us.

    We believe the middle-market represents a significant portion of the overall economy, and the demand for capital by middle-market companies reflects generally stronger growth trends and financial performance. In addition, due to the fragmented nature of the middle-market and the lack of publicly available information, we believe lenders have an opportunity to originate and underwrite investments with more favorable terms, including stronger covenant and reporting packages, as well as better call protection and change of control provisions as compared to the large, broadly syndicated loan market.

COMPETITIVE ADVANTAGES

              We believe that we have the following competitive advantages over other capital providers to middle-market companies:

The Ares Platform

              Ares operates three distinct but complementary investment groups, including the Ares Credit Group, the Ares Private Equity Group and the Ares Real Estate Group. We believe our affiliation with Ares provides a distinct competitive advantage through Ares' originations, due diligence, and marketing activities. In particular, we believe that the Ares platform provides us with an advantage through its deal flow generation and investment evaluation process. Ares' asset management platform also provides additional market information, company knowledge and industry insight that benefit our investment

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and due diligence process. Ares' professionals maintain extensive financial sponsor and intermediary relationships, which provide valuable insight and access to transactions and information.

Seasoned Management Team

              The investment professionals in the Ares Credit Group and members of our investment adviser's investment committee also have significant experience investing across market cycles. This experience also provides us with a competitive advantage in identifying, originating, investing in and managing a portfolio of investments in middle-market companies.

Broad Origination Strategy

              We focus on self-originating most of our investments by pursuing a broad array of investment opportunities in middle-market companies and power generation projects across multiple channels. We also leverage off of the extensive relationships of the broader Ares platform, including relationships with the portfolio companies in the IHAM Vehicles, to identify investment opportunities. Additionally, our size and scale provide the opportunity to source attractive investments in some of our existing portfolio companies. Collectively, we believe these advantages allow for enhanced asset selectivity as we believe there is a significant relationship between proprietary deal origination and credit performance. We believe that our focus on generating proprietary deal flow and lead investing also gives us greater control over capital structure, deal terms, pricing and documentation and enables us to actively manage our portfolio investments. Moreover, by leading the investment process, we are often able to secure controlling positions in credit tranches, thereby providing additional control in investment outcomes. We also have originated substantial proprietary deal flow from middle-market intermediaries, which often allows us to act as the sole or principal source of institutional capital to the borrower.

Scale and Flexible Transaction Structuring

              We believe that being one of the largest BDCs makes us a more desirable and flexible capital provider, especially in competitive markets. We are flexible with the types of investments we make and the terms associated with those investments. We believe this approach and experience enables our investment adviser to identify attractive investment opportunities throughout economic cycles and across a company's capital structure so we can make investments consistent with our stated investment objective and preserve principal while seeking appropriate risk adjusted returns. In addition, we have the flexibility to provide "one stop" financing with the ability to invest capital across the balance sheet and syndicate and hold larger investments than many of our competitors. We believe that the ability to underwrite, syndicate and hold larger investments benefits our stockholders by (a) potentially increasing net income and earnings through leadership of the investment process and making commitments in excess of our final investment, (b) increasing originated deal flow flexibility, (c) broadening market relationships and deal flow, (d) allowing us to optimize our portfolio composition and (e) allowing us to provide capital to a broader spectrum of middle-market companies, which we believe currently have limited access to capital from traditional lending sources. In addition, we believe that the ability to provide capital at every level of the balance sheet provides a strong value proposition to middle-market borrowers and our senior debt capabilities provide superior deal origination and relative value analysis capabilities compared to junior capital focused lenders.

Experience with and Focus on Middle-Market Companies

              Ares has historically focused on investments in middle-market companies and we benefit from this experience. In sourcing and analyzing deals, our investment adviser benefits from Ares' extensive network of relationships focused on middle-market companies, including management teams, members of the investment banking community, private equity groups and other investment firms with whom Ares has had long-term relationships. We believe this network enables us to identify well-positioned

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prospective portfolio company investments. The Ares Credit Group works closely with Ares' other investment professionals. As of March 31, 2019, Ares oversaw a portfolio of investments in approximately 1,700 companies, approximately 520 structured assets and approximately 170 properties across approximately 60 industries, which provides access to an extensive network of relationships and insights into industry trends and the state of the capital markets.

Disciplined Investment Philosophy

              In making its investment decisions, our investment adviser has adopted Ares' long-standing, consistent, credit-based investment approach that was developed over 20 years ago by its founders. Specifically, our investment adviser's investment philosophy, portfolio construction and portfolio management involve an assessment of the overall macroeconomic environment and financial markets and company-specific research and analysis. Its investment approach emphasizes capital preservation, low volatility and minimization of downside risk. In addition to engaging in extensive due diligence from the perspective of a long-term investor, our investment adviser's approach seeks to reduce risk in investments by focusing on:

    businesses with strong franchises and sustainable competitive advantages;

    industries with positive long-term dynamics;

    businesses and industries with cash flows that are dependable and predictable;

    management teams with demonstrated track records and appropriate economic incentives;

    rates of return commensurate with the perceived risks;

    securities or investments that are structured with appropriate terms and covenants; and

    businesses backed by experienced private equity sponsors.

Extensive Industry Focus

              We seek to concentrate our investing activities in industries with a history of predictable and dependable cash flows and in which the Ares investment professionals have had extensive investment experience. Ares investment professionals have developed long-term relationships with management teams and management consultants in approximately 60 industries, and have accumulated substantial information and identified potential trends within these industries. In turn, we benefit from these relationships, information and identification of potential trends in making investments.

OPERATING AND REGULATORY STRUCTURE

              Our investment activities are managed by our investment adviser and supervised by our board of directors, a majority of whom are independent of Ares and its affiliates. Our investment adviser is registered under the Advisers Act. Under our investment advisory and management agreement we have agreed to pay our investment adviser base management fees, income based fees and capital gains incentive fees. See "—Investment Advisory and Management Agreement." Ares Operations provides us with certain administrative and other services necessary for us to operate pursuant to the administration agreement. See "—Administration Agreement."

              As a BDC, we are required to comply with certain regulatory requirements. For example, we are not generally permitted to co-invest in any portfolio company in which a fund managed by Ares or any of its downstream affiliates (other than us and our downstream affiliates) is also co-investing. On January 18, 2017, we received an order from the SEC that permits us and other BDCs and registered closed-end management investment companies managed by Ares to co-invest in portfolio companies with each other and with affiliated investment funds. Co-investments made under the Co-investment

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Exemptive Order are subject to compliance with certain conditions and other requirements, which could limit our ability to participate in a co-investment transaction. We may also otherwise co-invest with funds managed by Ares or any of its downstream affiliates, subject to compliance with existing regulatory guidance, applicable regulations and our allocation procedures.

              Also, while we may borrow funds to make investments, our ability to use debt is limited in certain significant aspects. See "Regulation." In particular, under the provisions of the Investment Company Act, BDCs must have at least 200% asset coverage calculated pursuant to the Investment Company Act (i.e., we are permitted to borrow one dollar for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us) in order to incur debt or issue preferred stock (which we refer to collectively as "senior securities"), unless the BDC obtains approval (either stockholder approval or approval of a "required majority" of its board of directors) to apply the modified asset coverage requirements set forth in Section 61(a)(2) of the Investment Company Act, as amended by the SBCAA, reducing the required asset coverage ratio applicable to the BDC from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us).

              Currently, our asset coverage requirement applicable to senior securities is 200%. On June 21, 2018, our board of directors, including a "required majority" of our board of directors, approved the application of the modified asset coverage requirement set forth in Section 61(a)(2) of the Investment Company Act, as amended by the SBCAA. As a result, effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150%. In October 2018, we entered into certain amendments for our Revolving Credit Facility and Revolving Funding Facility to reduce the asset coverage requirements specified therein to 150%. See "Risk Factors—Risks Relating to Our Business—Effective on June 21, 2019, our asset coverage requirement will reduce from 200% to 150%, which may increase the risk of investing with us" and "Management's Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition, Liquidity and Capital Resources."

              As of March 31, 2019, our asset coverage was 215%.

              In addition, as a consequence of us being a RIC under the Code for U.S. federal income tax purposes, our asset growth is dependent on our ability to raise equity capital through the issuance of common stock. RICs generally must distribute substantially all of their investment company taxable income (as defined under the Code) to stockholders as dividends in order to preserve their status as a RIC and not to be subject to additional U.S. federal corporate-level income taxes. This requirement, in turn, generally prevents us from using our earnings to support our operations, including making new investments.

INVESTMENTS

Ares Capital Corporation Portfolio

              We have built an investment portfolio of primarily first and second lien senior secured loans, mezzanine debt and, to a lesser extent, equity investments in private middle-market companies. Our portfolio is well diversified by industry sector and its concentration to any single issuer is limited.

              Our debt investments in corporate borrowers generally range between $30 million and $500 million each and investments in project finance/power generation projects generally range between $10 million and $200 million each. However, the sizes of our investments may be more or less than these ranges and may vary based on, among other things, our capital availability, the composition of our portfolio and general micro- and macro-economic factors.

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              Our preferred and/or common equity investments have generally been non-control equity investments of less than $20 million (usually in conjunction with a concurrent debt investment). However, we may increase the size or change the nature of these investments.

              In addition, the proportion of these types of investments will change over time given our views on, among other things, the economic and credit environment in which we are operating. In pursuit of our investment objective we generally seek to self-originate investments and lead the investment process, which may result in us making commitments with respect to indebtedness or securities of a potential portfolio company in excess of our expected final hold size. In such situations, while we may initially agree to fund up to a certain dollar amount of an investment, we may subsequently syndicate or sell a portion of such amount such that we are left with a smaller investment than what was reflected in our original commitment. In addition to originating investments, we may also acquire investments in the secondary market (including purchases of a portfolio of investments).

              We make senior secured loans primarily in the form of first lien loans (including unitranche loans) and second lien loans. Our senior secured loans generally have terms of three to ten years. In connection with our senior secured loans we generally receive a security interest in certain of the assets of the borrower and consequently such assets serve as collateral in support of the repayment of such senior secured loans. Senior secured loans are generally exposed to the least amount of credit risk because they typically hold a senior position with respect to scheduled interest and principal payments and security interests in assets of the borrower. However, unlike mezzanine debt, senior secured loans typically do not receive any stock, warrants to purchase stock or other yield enhancements. Senior secured loans may include both revolving lines of credit and term loans.

              Structurally, mezzanine debt usually ranks subordinate in priority of payment to senior secured loans and is often unsecured. However, mezzanine debt ranks senior to preferred and common equity in a borrower's capital structure. Mezzanine debt investments generally offer lenders fixed returns in the form of interest payments and will often provide lenders an opportunity to participate in the capital appreciation of a borrower, if any, through an equity interest. This equity interest typically takes the form of an equity co-investment and/or warrants. Due to its higher risk profile and often less restrictive covenants as compared to senior secured loans, mezzanine debt generally bears a higher stated interest rate than senior secured loans. The equity co-investment and warrants (if any) associated with a mezzanine debt investment typically allow lenders to receive repayment of their principal on an agreed amortization schedule while retaining their equity interest in the borrower. Equity issued in connection with mezzanine debt also may include a "put" feature, which permits the holder to sell its equity interest back to the borrower at a price determined through an agreed formula.

              In making an equity investment, in addition to considering the factors discussed under "—Investment Selection" below, we also consider the anticipated timing of a liquidity event, such as a public offering, sale of the company or redemption of our equity securities.

              While our primary focus is to generate current income and capital appreciation through investments in first and second lien senior secured loans and mezzanine debt and, to a lesser extent, equity securities of eligible portfolio companies, we also may invest up to 30% of our portfolio in non-qualifying assets, as permitted by the Investment Company Act. See "Regulation." Specifically, as part of this 30% basket, we may invest in entities that are not considered "eligible portfolio companies" (as defined in the Investment Company Act), including companies located outside of the United States, entities that are operating pursuant to certain exceptions under the Investment Company Act, and publicly traded entities whose public equity market capitalization exceeds the levels provided for under the Investment Company Act.

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Senior Direct Lending Program

              We have established a joint venture with Varagon to make certain first lien senior secured loans, including certain stretch senior and unitranche loans, primarily to U.S. middle-market companies. Varagon was formed in 2013 as a lending platform by American International Group, Inc. and other partners. The joint venture is called the SDLP. The SDLP may generally commit and hold individual loans of up to $300 million. We may directly co-invest with the SDLP to accommodate larger transactions. The SDLP is capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of ours and Varagon (with approval from a representative of each required).

              We provide capital to the SDLP in the form of the SDLP Certificates, and Varagon and its clients provide capital to the SDLP in the form of senior notes, intermediate funding notes and the SDLP Certificates. As of March 31, 2019, we and a client of Varagon owned 87.5% and 12.5%, respectively, of the outstanding SDLP Certificates. The SDLP Certificates pay a coupon of LIBOR plus a stated spread and also entitle the holders thereof to receive a portion of the excess cash flow from the loan portfolio, which may result in a return to the holders of the SDLP Certificates that is greater than the stated coupon. The SDLP Certificates are junior in right of payment to the senior notes and intermediate funding notes.

              As of March 31, 2019, we and Varagon and its clients had agreed to make capital available to the SDLP of $6.2 billion in the aggregate, of which $3.3 billion has been funded. As of March 31, 2019, we agreed to make available to the SDLP (subject to the approval of the SDLP as described above) $1.4 billion, of which $792 million was funded. As of March 31, 2019, the SDLP had commitments to fund delayed draw loans to certain of its portfolio companies of $243 million, which had been approved by the investment committee of the SDLP as described above, of which $58 million was committed by us.

              For more information on the SDLP, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Portfolio and Investment Activity—Senior Direct Lending Program" and Note 4 to our consolidated financial statements for the three months ended March 31, 2019.

Ivy Hill Asset Management, L.P.

              As of March 31, 2019, our portfolio company, IHAM, an SEC-registered investment adviser, managed 21 vehicles and served as the sub-manager/sub-servicer for two other vehicles. As of March 31, 2019, IHAM had assets under management of approximately $4.6 billion. As of March 31, 2019, the amortized cost and fair value of our investment in IHAM was $444 million and $534 million, respectively. In connection with IHAM's registration as a registered investment adviser, on March 30, 2012, we received exemptive relief from the SEC allowing us to, subject to certain conditions, own directly or indirectly up to 100% of IHAM's outstanding equity interests and make additional investments in IHAM. From time to time, IHAM or certain IHAM Vehicles may purchase investments from us or sell investments to us, in each case for a price equal to the fair market value of such investments determined at the time of such transactions.

Industry Composition

              We generally seek to invest in companies in the industries in which Ares' investment professionals have direct expertise. The following is a representative list of the industries in which we may invest:

    Aerospace and Defense

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    Automotive Services

    Business Services

    Consumer Products

    Containers and Packaging

    Education

    Financial Services

    Food and Beverage

    Healthcare Services

    Investment Funds and Vehicles

    Manufacturing

    Oil and Gas

    Other Services

    Power Generation

    Restaurant and Food Services

    Telecommunications

    Wholesale Distributions

              However, we may invest in other industries if we are presented with attractive opportunities.

              The industrial and geographic compositions of our portfolio at fair value as of March 31, 2019 and December 31, 2018 were as follows:

 
  As of  
Industry
  March 31,
2019
  December 31,
2018
 

Healthcare Services

    22.2 %   21.7 %

Business Services

    17.2     17.9  

Consumer Products

    7.7     8.3  

Investment Funds and Vehicles(1)

    6.9     6.2  

Financial Services

    6.4     6.6  

Other Services

    5.3     5.7  

Manufacturing

    5.3     6.1  

Power Generation

    5.0     4.8  

Automotive Services

    3.9     2.8  

Restaurants and Food Services

    3.6     3.8  

Food and Beverage

    3.5     2.9  

Oil and Gas

    2.9     3.0  

Wholesale Distribution

    2.3     2.3  

Containers and Packaging

    1.9     1.5  

Education

    1.9     2.2  

Other

    4.0     4.2  

Total

    100.0 %   100.0 %

(1)
Includes the Company's investment in the SDLP, which made first lien senior secured loans to 22 and 21 different borrowers as of March 31, 2019 and December 31, 2018,

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    respectively. The portfolio companies in the SDLP are in industries similar to the companies in the Company's portfolio.

 
  As of  
Geographic Region
  March 31,
2019
  December 31,
2018
 

Midwest

    27.1 %   31.4 %

West(1)

    24.3     24.0  

Southeast

    20.8     18.8  

Mid Atlantic

    17.5     18.2  

Northeast

    7.8     5.4  

International

    2.5     2.2  

Total

    100.0 %   100.0 %

(1)
Includes the Company's investment in the SDLP, which represented 6.1% and 5.3% of the total investment portfolio at fair value as of March 31, 2019 and December 31, 2018, respectively.

              As of March 31, 2019, 2.3% of total investments at amortized cost (or 0.4% of total investments at fair value) were on non-accrual status. As of December 31, 2018, 2.5% of total investments at amortized cost (or 0.6% of total investments at fair value) were on non-accrual status.

              Since our IPO on October 8, 2004 through March 31, 2019, our exited investments resulted in an asset level realized gross internal rate of return to us of approximately 14% (based on original cash invested, net of syndications, of approximately $25.4 billion and total proceeds from such exited investments of approximately $32.5 billion). Internal rate of return is the discount rate that makes the net present value of all cash flows related to a particular investment equal to zero. Internal rate of return is gross of expenses related to investments as these expenses are not allocable to specific investments. Investments are considered to be exited when the original investment objective has been achieved through the receipt of cash and/or non-cash consideration upon the repayment of a debt investment or sale of an investment or through the determination that no further consideration was collectible and, thus, a loss may have been realized. Approximately 62% of these exited investments resulted in an asset level realized gross internal rate of return to us of 10% or greater.

              Additionally, since our IPO on October 8, 2004 through March 31, 2019, our realized gains exceeded our realized losses by approximately $1.0 billion (excluding a one-time gain on the Allied Acquisition) and realized gains/losses from the extinguishment of debt and other assets. For this same time period, our average annualized net realized gain rate was approximately 1.2% (excluding a one-time gain on the Allied Acquisition and realized gains/losses from the extinguishment of debt and other assets). Net realized gain/loss rates for a particular period are the amount of net realized gains/losses during such period divided by the average quarterly investments at amortized cost in such period.

              Information included herein regarding internal rates of return, realized gains and losses and annualized net realized gain rates are historical results relating to our past performance and are not necessarily indicative of future results, the achievement of which cannot be assured.

INVESTMENT SELECTION

              Ares' investment philosophy was developed over 20 years ago and has remained consistent and relevant throughout a number of economic cycles. We are managed using a similar investment philosophy used by the investment professionals of Ares in respect of its other investment funds.

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              This investment philosophy involves, among other things:

    an assessment of the overall macroeconomic environment and financial markets and how such assessment may impact industry and asset selection;

    company-specific research and analysis; and

    with respect to each individual company, an emphasis on capital preservation, low volatility and minimization of downside risk.

              The foundation of Ares' investment philosophy is intensive credit investment analysis, a portfolio management discipline based on both market technicals and fundamental value-oriented research, and diversification strategy. We follow a rigorous investment process based on:

    a comprehensive analysis of issuer creditworthiness, including a quantitative and qualitative assessment of the issuer's business;

    an evaluation of management and its economic incentives;

    an analysis of business strategy and industry trends; and

    an in-depth examination of capital structure, financial results and projections.

              We seek to identify those companies exhibiting superior fundamental risk-reward profiles and strong defensible business franchises while focusing on the relative value of the investment across the industry as well as for the specific company.

Intensive Due Diligence

              The process through which an investment decision is made involves extensive research into the target company, its industry, its growth prospects and its ability to withstand adverse conditions. If the senior investment professional responsible for the potential transaction determines that an investment opportunity should be pursued, we will engage in an intensive due diligence process. Approximately 30-40% of the investments initially reviewed by us proceed to this phase. Though each transaction will involve a somewhat different approach, the regular due diligence steps generally undertaken include:

    meeting with the target company's management team to get a detailed review of the business, and to probe for potential weaknesses in business prospects;

    checking management's backgrounds and references;

    performing a detailed review of historical financial performance, including performance through various economic cycles, and the quality of earnings;

    reviewing both short and long term projections of the business, and sensitizing them for both upside and downside risk;

    visiting headquarters and company operations and meeting with top and middle-level executives;

    contacting customers and vendors to assess both business prospects and standard practices;

    conducting a competitive analysis, and comparing the issuer to its main competitors on an operating, financial, market share and valuation basis;

    researching the industry for historic growth trends and future prospects as well as to identify future exit alternatives (including available Wall Street research, industry association literature and general news);

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    assessing asset value and the ability of physical infrastructure and information systems to handle anticipated growth; and

    investigating legal risks and financial and accounting systems.

Selective Investment Process

              After an investment has been identified and preliminary diligence has been completed, a credit research and analysis report is prepared. This report is reviewed by the senior investment professional in charge of the potential investment. If such senior and other investment professionals are in favor of the potential investment, then it is first presented to the investment committee on a preliminary basis.

              After the investment committee approves continued work on the potential investment, a more extensive due diligence process is employed by the transaction team. Additional due diligence with respect to any investment may be conducted on our behalf by attorneys, independent accountants, and other third party consultants and research firms prior to the closing of the investment, as appropriate on a case-by-case basis. Approximately 7-10% of all investments initially reviewed by us will be presented to the investment committee. Approval of an investment for funding requires the approval of the majority of the investment committee of our investment adviser, although unanimous consent is sought.

Issuance of Formal Commitment

              Once we have determined that a prospective portfolio company is suitable for investment, we work with the management and/or sponsor of that company and its other capital providers, including senior, junior and equity capital providers, if any, to finalize the structure of the investment. Approximately 3-5% of the investments initially reviewed by us eventually result in the issuance of formal commitments and the closing of such transactions.

Debt Investments

              We invest in portfolio companies primarily in the form of first lien senior secured loans (including unitranche loans), second lien senior secured loans and mezzanine debt. The first and second lien senior secured loans generally have terms of three to ten years. In connection with our first and second lien senior secured loans we generally receive security interests in certain assets of our portfolio companies that could serve as collateral in support of the repayment of such loans. First and second lien senior secured loans generally have floating interest rates, which may have LIBOR floors, and also may provide for some amortization of principal and excess cash flow payments, with the remaining principal balance due at maturity.

              We structure our mezzanine investments primarily as unsecured subordinated loans that provide for relatively higher fixed interest rates. The mezzanine debt investments generally have terms of up to ten years. These loans typically have interest-only payments, with amortization of principal, if any, deferred to the later years of the mezzanine investment. In some cases, we may enter into loans that, by their terms, convert into equity or additional debt or defer payments of interest (or at least cash interest) for the first few years after our investment. Also, in some cases our mezzanine debt will be secured by a subordinated lien on some or all of the assets of the borrower.

              In some cases, our debt investments may provide for a portion of the interest payable to be PIK interest. To the extent interest is PIK, it will be payable through the increase of the principal amount of the loan by the amount of interest due on the then-outstanding aggregate principal amount of such loan.

              In the case of our first and second lien senior secured loans and mezzanine debt, we tailor the terms of the investment to the facts and circumstances of the transaction and the prospective portfolio

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company, negotiating a structure that aims to protect our rights and manage our risk while creating incentives for the portfolio company to achieve its business plan and improve its profitability. For example, in addition to seeking a senior position in the capital structure of our portfolio companies, we will seek, where appropriate, to limit the downside potential of our investments by:

    targeting a total return on our investments (including both interest and potential equity appreciation) that compensates us for credit risk;

    incorporating "put" rights, call protection and LIBOR floors for floating rate loans, into the investment structure; and

    negotiating covenants in connection with our investments that afford our portfolio companies as much flexibility in managing their businesses as possible, consistent with preservation of our capital. Such restrictions may include affirmative and negative covenants, default penalties, lien protection, change of control provisions and board rights, including either observation or participation rights.

              We generally require financial covenants and terms that require an issuer to reduce leverage, thereby enhancing credit quality. These methods include: (a) maintenance leverage covenants requiring a decreasing ratio of indebtedness to cash flow over time, (b) maintenance cash flow covenants requiring an increasing ratio of cash flow to the sum of interest expense and capital expenditures and (c) indebtedness incurrence prohibitions, limiting a company's ability to take on additional indebtedness. In addition, by including limitations on asset sales and capital expenditures we may be able to prevent a borrower from changing the nature of its business or capitalization without our consent.

              Our debt investments may include equity features, such as warrants or options to buy a minority interest in the portfolio company. Warrants we receive with our debt investments may require only a nominal cost to exercise, and thus, as a portfolio company appreciates in value, we may achieve additional investment return from this equity interest. We may structure the warrants to provide provisions protecting our rights as a minority-interest holder, as well as puts, or rights to sell such securities back to the portfolio company, upon the occurrence of specified events. In many cases, we also obtain registration rights in connection with these equity interests, which may include demand and "piggyback" registration rights.

              We believe that our focus on generating proprietary deal flow and lead investing gives us greater control over the capital structures and investment terms described above and enables us to actively manage our investments. Moreover, by leading the investment process, we are often able to secure controlling positions in loan tranches, thereby providing additional control in investment outcomes.

Equity Investments

              To a lesser extent, we also make preferred and/or common equity investments, which have generally been non-control equity investments, of less than $20 million (usually in conjunction with a concurrent debt investment). However, we may increase the size or change the nature of these investments.

ACQUISITION OPPORTUNITIES

              We believe that there may be opportunity for further consolidation in our industry. From time to time, we evaluate potential strategic opportunities, including acquisitions of:

    asset portfolios;

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    other private and public finance companies, business development companies and asset managers; and

    selected secondary market assets.

              We have been in, and from time to time may engage in, discussions with counterparties in respect of various potential strategic acquisition and investment transactions, including potential acquisitions of other finance companies, business development companies and asset managers. Some of these transactions could be material to our business and, if completed, could be difficult to integrate, result in increased leverage or dilution and/or subject us to unexpected liabilities. However, none of these discussions has progressed to the point at which the completion of any such transaction could be deemed to be probable or reasonably certain as of the date of this prospectus. Completion of any such transaction would be subject to completion of due diligence, finalization of key business and financial terms (including price) and negotiation of final definitive documentation as well as a number of other factors and conditions including, without limitation, the approval of our board of directors, any required third party consents and, in certain cases, the approval of our stockholders. We cannot predict how quickly the terms of any such transaction could be finalized, if at all. Accordingly, there can be no assurance that such transaction would be completed. In connection with evaluating potential strategic acquisition and investment transactions, we may incur significant expenses for the evaluation and due diligence investigation of these potential transactions.

ON-GOING RELATIONSHIPS WITH AND MONITORING OF PORTFOLIO COMPANIES

              We closely monitor each investment we make, maintain a regular dialogue with both the management team and other stakeholders and seek specifically tailored financial reporting. In addition, senior investment professionals may take board seats or obtain board observation rights in connection with our portfolio companies. As of March 31, 2019, of our 345 portfolio companies, we were entitled to board seats or board observation rights on 25% of these companies and these companies represented approximately 40% of our portfolio at fair value.

              We seek to exert significant influence post-investment, in addition to covenants and other contractual rights and through board participation, when appropriate, by actively working with management on strategic initiatives. We often introduce managers of companies in which we have invested to other portfolio companies to capitalize on complementary business activities and best practices.

              We believe that our focus on generating proprietary deal flow gives us greater control over capital structure and investment terms and lead investing enhances our ability to closely monitor each investment we make and to exert significant influence post-investment.

              Our investment adviser employs an investment rating system to categorize our investments. In addition to various risk management and monitoring tools, our investment adviser grades the credit risk of all investments on a scale of 1 to 4 no less frequently than quarterly. This system is intended primarily to reflect the underlying risk of a portfolio investment relative to our initial cost basis in respect of such portfolio investment (i.e., at the time of origination or acquisition), although it may also take into account under certain circumstances the performance of the portfolio company's business, the collateral coverage of the investment and other relevant factors. Under this system, investments with a grade of 4 involve the least amount of risk to our initial cost basis. The trends and risk factors for this investment since origination or acquisition are generally favorable, which may include the performance of the portfolio company or a potential exit. Investments graded 3 involve a level of risk to our initial cost basis that is similar to the risk to our initial cost basis at the time of origination or acquisition. This portfolio company is generally performing as expected and the risk factors to our ability to ultimately recoup the cost of our investment are neutral to favorable. All investments or acquired investments in new portfolio companies are initially assessed a grade of 3. Investments graded 2

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indicate that the risk to our ability to recoup the initial cost basis of such investment has increased materially since origination or acquisition, including as a result of factors such as declining performance and non-compliance with debt covenants; however, payments are generally not more than 120 days past due. An investment grade of 1 indicates that the risk to our ability to recoup the initial cost basis of such investment has substantially increased since origination or acquisition, and the portfolio company likely has materially declining performance. For debt investments with an investment grade of 1, most or all of the debt covenants are out of compliance and payments are substantially delinquent. For investments graded 1, it is anticipated that we will not recoup our initial cost basis and may realize a substantial loss of our initial cost basis upon exit. For investments graded 1 or 2, our investment adviser enhances its level of scrutiny over the monitoring of such portfolio company. The grade of a portfolio investment may be reduced or increased over time.

              As of March 31, 2019, the weighted average grade of our portfolio at fair value was 3.1. For more information, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Portfolio and Investment Activity."

MANAGERIAL ASSISTANCE

              As a BDC, we must offer, and must provide upon request, significant managerial assistance to certain of our portfolio companies. This assistance could involve, among other things, monitoring the operations of our portfolio companies, participating in board and management meetings, consulting with and advising officers of portfolio companies and providing other organizational and financial guidance. Ares Operations may provide all or a portion of this assistance pursuant to our administration agreement, the costs of which will be reimbursed by us. We may receive fees for these services.

COMPETITION

              Our primary competitors include public and private funds, commercial and investment banks, commercial finance companies, other BDCs and private equity funds, each of which we compete with for financing opportunities. Many of our competitors are substantially larger and have considerably greater financial and marketing resources than we do. For example, some competitors may have access to funding sources that are not available to us. In addition, some of our competitors may have higher risk tolerances or different risk assessments, which could allow them to consider more investments and establish more relationships than we do. Furthermore, many of our competitors are not subject to the regulatory restrictions that the Investment Company Act imposes on us as a BDC. For additional information concerning the competitive risks we face, see "Risk Factors—Risks Relating to Our Business—We operate in a highly competitive market for investment opportunities."

              We believe that the relationships of the members of our investment adviser's investment committee and of the partners of Ares enable us to learn about, and compete effectively for, financing opportunities with attractive middle-market companies in the industries in which we seek to invest. We believe that Ares' professionals' deep and long-standing direct sponsor relationships and the resulting proprietary transaction opportunities that these relationships often present, provide valuable insight and access to transactions and information. We use the industry information of Ares' investment professionals to which we have access to assess investment risks and determine appropriate pricing for our investments in portfolio companies.

STAFFING

              We do not currently have any employees and do not expect to have any employees. Services necessary for our business are provided by individuals who are employees or affiliates of our investment adviser, Ares Capital Management, and our administrator, Ares Operations, each of which is a

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subsidiary of Ares Management, pursuant to the terms of our investment advisory and management agreement and our administration agreement, respectively, each as described below. Each of our executive officers is an employee or affiliate of our investment adviser or our administrator. Our day-to-day investment activities are managed by our investment adviser. Most of the services necessary for the origination of our investment portfolio are provided by investment professionals employed by Ares Capital Management. Ares Capital Management had approximately 105 U.S.-based investment professionals as of March 31, 2019 who focus on origination, transaction development, investment and the ongoing monitoring of our investments. See "Management—Investment Advisory and Management Agreement" below. We reimburse both our investment adviser and our administrator for a certain portion of expenses incurred in connection with such staffing, as described in more detail below. Because we have no employees, Ares Capital does not have a formal employee relations policy.

PROPERTIES

              We do not own any real estate or other physical properties materially important to our operation. Our headquarters are currently located at 245 Park Avenue, 44th Floor, New York, New York 10167. We are party to office leases pursuant to which we are leasing office facilities from third parties. For certain of these office leases, we have also entered into separate subleases with Ares Management LLC, pursuant to which Ares Management LLC, the sole member of Ares Capital Management, subleased the full amount of such leases from us.

LEGAL PROCEEDINGS

              We are party to certain lawsuits in the normal course of business. In addition, American Capital and Allied Capital were involved in various legal proceedings that we assumed in connection with the American Capital Acquisition and the Allied Acquisition, respectively. Furthermore, third parties may try to seek to impose liability on us in connection with our activities or the activities of our portfolio companies. While the outcome of any such legal proceedings cannot at this time be predicted with certainty, we do not expect that these legal proceedings will materially affect our business, financial condition or results of operations.

              On May 20, 2013, we were named as one of several defendants in an action filed in the United States District Court for the Eastern District of Pennsylvania by the bankruptcy trustee of DSI Renal Holdings LLC ("DSI Renal") and two affiliate companies. On March 17, 2014, the motion by us and the other defendants to transfer the case to the United States District Court for the District of Delaware (the "Delaware Court") was granted. On May 6, 2014, the Delaware Court referred the matter to the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). The complaint alleges, among other things, that each of the named defendants participated in a purported fraudulent transfer involving the restructuring of a subsidiary of DSI Renal. Among other things, the complaint seeks, jointly and severally from all defendants, (1) damages of approximately $425 million, of which the complaint states our individual share is approximately $117 million, (2) interest thereon according to law, and (3) punitive damages. The defendants filed a motion to dismiss all claims on August 5, 2013. On July 20, 2017, the Bankruptcy Court issued an order granting the motion to dismiss certain claims and denying the motion to dismiss certain other claims, including the purported fraudulent transfer claims. The defendants answered the complaint on August 31, 2017. Under the operative scheduling order, discovery ended on March 29, 2019 with dispositive motions due on April 30, 2019. No trial date has been set. We are currently unable to assess with any certainty whether we may have any exposure in this matter. However, we believe the plaintiff's claims are without merit and we intend to vigorously defend ourselves in this matter.

              On August 3, 2017, American Capital and one of its former portfolio companies were awarded a judgment plus prejudgment interest by the United States District Court for the District of Maryland (the "District Court") following a bench trial in a case first filed by one of American Capital's

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insurance companies concerning coverage for bodily injury claims against American Capital and/or its former portfolio company. The District Court found that the carrier breached its duty to defend American Capital and its former portfolio company against more than 1,000 bodily injury claims and awarded American Capital damages plus prejudgment interest. American Capital's carrier filed a notice of appeal to the United States Court of Appeals for the Fourth Circuit (the "Court of Appeals"); thereafter, American Capital and its former portfolio company filed a notice of cross appeal, including cross claims. The appeal was fully briefed and oral argument on the appeal took place on September 6, 2018. On February 6, 2019, the Court of Appeals entered a judgment affirming the District Court judgment in all respects in the amount of approximately $89 million. The carrier filed petitions for rehearing and rehearing en banc , both of which were denied by the Court of Appeals on March 7, 2019. On March 15, 2019, the carrier paid the approximately $89 million judgment in full, of which the American Capital share was approximately $53 million. American Capital also intends to petition the District Court for recovery of its reasonable legal fees and costs in connection with the litigation. The extent of American Capital's recovery of such fees and costs is not yet known. We expect that the earliest this matter will be resolved is the end of the second quarter of 2019.

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PORTFOLIO COMPANIES

              The following table describes each of the businesses included in our portfolio and reflects data as of March 31, 2019. Percentages shown for class of investment securities held by us represent percentage of the class owned and do not necessarily represent voting ownership. Percentages shown for equity securities, other than warrants or options, represent the actual percentage of the class of security held before dilution. Percentages shown for warrants and options held represent the percentage of class of security we may own assuming we exercise our warrants or options before dilution.

              We have indicated by footnote portfolio companies (a) where we directly or indirectly own more than 25% of the outstanding voting securities of such portfolio company and, therefore, are presumed to be "controlled" by us under the Investment Company Act and (b) where we directly or indirectly own 5% to 25% of the outstanding voting securities of such portfolio company or where we hold one or more seats on the portfolio company's board of directors and, therefore, are deemed to be an "affiliated person" under the Investment Company Act. We directly or indirectly own less than 5% of the outstanding voting securities of all other portfolio companies (or have no other affiliations with such portfolio companies) listed on the table. We offer to make significant managerial assistance to certain of our portfolio companies. Where we do not hold a seat on the portfolio company's board of directors, we may receive rights to observe such board meetings.

              Where we have indicated by footnote the amount of undrawn commitments to portfolio companies to fund various revolving and delayed draw senior secured and subordinated loans, such undrawn commitments are presented net of (i) standby letters of credit treated as drawn commitments because they are issued and outstanding, (ii) commitments substantially at our discretion and (iii) commitments that are unavailable due to borrowing base or other covenant restrictions.

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PORTFOLIO COMPANIES
As of March 31, 2019
(dollar amounts in millions)
(Unaudited)

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  

1A Smart Start, LLC

  Provider of ignition interlock   First lien senior secured   7.00% (Libor + 4.50%/M)   8/21/2020         $ 0.9 (6)

500 E Dallas Road

  devices   revolving loan                      

Suite 100

                             

Grapevine, TX 76051

                             

                             

42 North Dental, LLC

  Dental services provider   First lien senior secured       5/27/2022           (7)

(fka Gentle Communications, LLC)

      revolving loan                      

200 5th Avenue

                             

Suite 3

                             

Waltham, MA 02451

                             

                             

A.U.L. Corp.

  Provider of vehicle service   First lien senior secured       6/5/2023           (8)

1250 Main Street

  contracts and limited   revolving loan                      

Suite 300

  warranties for passenger   First lien senior secured loan   7.00% (Libor + 4.50%/M)   6/5/2023           7.0  

Napa, CA 94559

  vehicles                          

                             

Absolute Dental Management LLC and ADM

  Dental services provider   First lien senior secured loan       1/5/2022           7.1  

Equity, LLC

      First lien senior secured loan   11.00% (Base Rate + 5.50%/Q)   1/5/2022           0.8  

526 South Tonopah Drive

      Class A preferred units             8.46 %    

Suite 200

      Class A common units             8.46 %    

Las Vegas, NV 89106

                             

                             

ACAS Equity Holdings Corporation(4)(5)

  Investment company   Common stock             100.00 %   0.4  

2000 Avenue of the Stars

                             

12th Floor

                             

Los Angeles, CA 90067

                             

                             

ACAS Real Estate Holdings Corporation(4)

  Real estate holding company   Common stock             100.00 %   2.6  

2000 Avenue of the Stars

                             

12th Floor

                             

Los Angeles, CA 90067

                             

                             

Accommodations Plus Technologies LLC and

  Provider of outsourced crew   First lien senior secured       5/11/2023           (9)

Accommodations Plus Technologies

  accommodations and logistics   revolving loan                      

Holdings LLC

  management solutions to the   Class A common units             0.10 %   6.5  

265 Broadhollow Road

  airline industry                          

Melville, NY 11747

                             

                             

Acessa Health Inc. (fka HALT Medical, Inc.)

  Medical supply provider   Common stock             1.18 %    

121 Sand Creek Road

                             

Suite B

                             

Brentwood, CA 94513

                             

                             

Achilles Acquisition LLC

  Benefits broker and   First lien senior secured       10/11/2023           (10)

200 Galleria Parkway

  outsourced   revolving loan                      

Atlanta, GA 30339

  workflow automation   First lien senior secured loan       10/13/2025           (11)

  platform provider for brokers   First lien senior secured loan   6.50% (Libor + 4.00%/M)   10/13/2025           16.7  

      First lien senior secured loan   6.50% (Libor + 4.00%/M)   10/13/2025           21.3  

                             

ADCS Billings Intermediate Holdings, LLC

  Dermatology practice   First lien senior secured   10.25% (Base Rate + 4.75%/Q)   5/18/2022           1.2 (12)

151 South Lane

      revolving loan                      

Suite 300

                             

Maitland, FL 32751

                             

                             

ADF Capital, Inc., ADF Restaurant

  Restaurant owner and   First lien senior secured loan       12/18/2018           (13)

Group, LLC, and ARG Restaurant

  operator   First lien senior secured loan   20.61% PIK (Libor + 18.00%/Q)   12/18/2018           4.1  

Holdings, Inc.(4)

      First lien senior secured loan       12/18/2018            

165 Passaic Avenue

      Promissory note       12/18/2023     1.86 %    

Fairfield, NJ 07004

      Warrant       12/18/2023     95.00 %   (2)

                             

ADG, LLC and RC IV GEDC Investor LLC

  Dental services provider   First lien senior secured   7.25% (Libor + 4.75%/M)   9/28/2022           3.0 (14)

29777 Telegraph Road

      revolving loan                      

Suite 3000

      First lien senior secured   9.25% (Base Rate + 3.75%/Q)   9/28/2022           10.1 (14)

Southfeild, MI 48304

      revolving loan                      

      Second lien senior secured   11.88% (Libor + 9.00%/S)   3/28/2024           75.3  

      loan                      

      Membership units             0.92 %   0.8  

                             

AEP Holdings, Inc. and Arrowhead Holdco

  Distributor of   First lien senior secured   8.62% (EURIBOR + 6.00%/Q)   8/31/2021           0.1  

Company

  non-discretionary, mission-   loan                      

3787 95th Avenue

  critical aftermarket   First lien senior secured loan   8.74% (EURIBOR + 6.00%/Q)   8/31/2021           25.4  

Blaine, MN 55104

  replacement parts   Common stock             1.17 %   2.0  

                             

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Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  

Aimbridge Acquisition Co., Inc.

  Hotel operator   Second lien senior secured   9.99% (Libor + 7.50%/M)   2/1/2027           14.0  

5851 Legacy Circle

  loan                          

Suite 400

                             

Plano, TX 75024

                             

                             

Air Medical Group Holdings, Inc. and Air

  Emergency air medical   Senior subordinated loan   10.36% (Libor + 7.88%/M)   3/13/2026           179.9  

Medical Buyer Corp.

  services provider   Warrant             0.08 %   1.4 (2)

209 Highway 121 Bypass

                             

Suite 21

                             

Lewisville, TX 75067

                             

                             

Alcami Corporation and

  Outsourced drug   First lien senior secured   6.25% (Libor + 3.75%/M)   7/12/2023           1.7 (15)

ACM Holdings I, LLC

  development services   revolving loan                      

2320 Scientific Park Drive

  provider   First lien senior secured   6.23% (Libor + 3.75%/M)   7/12/2023           1.7 (15)

Wilmington, NC 28405

      revolving loan                      

      First lien senior secured loan   6.73% (Libor + 4.25%/M)   7/14/2025           29.1  

      Second lien senior secured loan   10.48% (Libor + 8.00%/M)   7/13/2026           73.6  

      Common units             9.20 %   21.1  

                             

Alera Group Intermediate Holdings, Inc.

  Insurance service provider   First lien senior secured loan       8/1/2025           (16)

3 Parkway North

      Second lien senior secured       3/5/2026           (17)

Deerfield, IL 60015

      loan                      

      Second lien senior secured loan   11.00% (Libor + 8.50%/M)   3/5/2026           25.9  

                             

Alphabet Energy, Inc.

  Technology developer to   First lien senior secured loan       8/1/2017            

26225 Eden Landing Road

  convert waste-heat into   First lien senior secured loan       8/1/2017            

Suite D

  electricity   Series 1B preferred stock             0.19 %    

Hayward, CA 94545

      Warrant       12/12/2023     0.88 %   (2)

                             

Alteon Health, LLC

  Provider of physician   First lien senior secured loan   9.00% (Libor + 6.50%/M)   9/1/2022           2.5  

350 Motor Parkway

  management services                          

Suite 309

                             

Hauppauge, NY 11788

                             

                             

AMCP Clean Intermediate, LLC

  Provider of janitorial and   First lien senior secured       10/1/2024           (18)

150 East 42nd Street

  facilities management services   revolving loan                      

New York, NY 10017

      First lien senior secured loan   8.29% (Libor + 5.50%/Q)   10/1/2024           13.7  

                             

American Academy Holdings, LLC

  Provider of education,   First lien senior secured   10.75% (Base Rate + 5.25%/M)   12/15/2022           0.9 (19)

2233 S Presidents Dr

  training, certification,   revolving loan                      

Suite F

  networking, and consulting   First lien senior secured loan   10.75% (Base Rate + 5.25%/M)   12/15/2022           85.8  

Salt Lake City, UT 84120

  services to medical coders   First lien senior secured loan   10.75% (Base Rate + 5.25%/M)   12/15/2022           92.3  

  and other healthcare professionals   Senior subordinated loan   18.50% (Libor + 7.00% Cash, 6.00% PIK/Q)   6/15/2023           85.2  

                             

American Residential Services L.L.C.

  Heating, ventilation and air   Second lien senior secured   10.50% (Libor + 8.00%/M)   12/31/2022           69.3  

965 Ridge Lake Blvd

  conditioning services provider   loan                      

Memphis, TN 38120

                             

                             

American Seafoods Group LLC and

  Harvester and processor of   Class A units             0.24 %   0.2  

American Seafoods Partners LLC

  seafood   Warrant       8/19/2035     3.36 %   15.6 (2)

2025 First Avenue

                             

Suite 900

                             

Seattle, WA 98121

                             

                             

Amynta Agency Borrower Inc.

  Insurance service provider   First lien senior secured loan   7.00% (Libor + 4.50%/M)   2/28/2025           10.5  

and Amynta Warranty Borrower Inc.

      First lien senior secured loan   7.00% (Libor + 4.50%/M)   2/28/2025           15.8  

60 Broad Street

                             

New York, NY 10004

                             

                             

AMZ Holding Corp.

  Specialty chemicals   First lien senior secured       6/27/2022           (20)

4800 State Road 60 East

  manufacturer   revolving loan                      

Mulberry, FL 33860

      First lien senior secured loan   9.50% (Base Rate + 4.00%/Q)   6/27/2022            

      First lien senior secured loan   7.50% (Libor + 5.00%/M)   6/27/2022           12.0  

                             

Apex Clean Energy Holdings, LLC

  Developer, builder and owner   First lien senior secured       9/12/2019           (21)

310 4th Street, N.E

  of utility-scale wind and   revolving loan                      

Suite 200

  solar power facilities   First lien senior secured loan   9.35% (Libor + 6.75%/Q)   9/24/2022           94.7  

Charlottesville, VA 22902

                             

                             

Apptio, Inc.

  Provider of cloud-based   First lien senior secured       1/10/2025           (22)

11100 NE 8th Street

  technology business   revolving loan                      

Suite 600

  management solutions   First lien senior secured loan   9.74% (Libor + 7.25%/M)   1/10/2025           50.3  

Bellevue, WA 98004

                             

                             

Ares IIIR/IVR CLO Ltd.(5)

  Investment vehicle   Subordinated notes       4/16/2021           0.1  

P.O. Box 1093 South Church Street

                             

GT Queensgate House

                             

George Town, Grand Cayman

                             

Cayman Islands

                             

                             

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Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  

athenahealth, Inc., VVC Holding Corp.,

  Revenue cycle management   First lien senior secured       2/12/2024           (23)

Virence Intermediate Holding Corp., and

  provider to the physician   revolving loan                      

Virence Holdings LLC

  practices and acute care   First lien senior secured loan   7.20% (Libor + 4.50%/Q)   2/11/2026           31.6  

311 Arsenal Street

  hospitals   Second lien senior secured   11.20% (Libor + 8.50%/Q)   2/11/2027           206.1  

Watertown, MA 02472

      loan                      

      Senior preferred stock   13.62% PIK (Libor + 11.13%)         20.30 %   121.8  

      Class A interests             0.00 %   9.0  

                             

Athletic Club Holdings, Inc.

  Premier health club operator   First lien senior secured loan   11.13% (Libor + 8.50%/Q)   10/31/2020           3.2  

5201 East Tudor Road

                             

Anchorage, AL 99507

                             

                             

Avetta, LLC

  Supply chain risk   First lien senior secured       4/10/2024           (24)

17671 Cowan

  management SaaS platform   revolving loan                      

Suite 150

  for global enterprise   First lien senior secured loan       4/10/2024           (25)

Irvine, CA 92614

  clients   First lien senior secured loan   7.98% (Libor + 5.50%/M)   4/10/2024           51.8  

                             

Badger Sportswear Acquisition, Inc.

  Provider of team uniforms   Second lien senior secured   11.50% (Libor + 9.00%/M)   3/11/2024           55.1  

111 Badger Lane

  and athletic wear   loan                      

Statesville, NC 28625

                             

                             

Bambino CI Inc.

  Manufacturer and provider of   First lien senior secured   7.99% (Libor + 5.50%/M)   10/17/2022           0.1 (26)

747 West 4170

  single-use obstetrics products   revolving loan                      

South Murray, UT 84123

      First lien senior secured revolving loan   7.98% (Libor + 5.50%/Q)   10/17/2022           1.1 (26)

      First lien senior secured revolving loan   10.00% (Base Rate + 4.50%/Q)   10/17/2022           1.1 (26)

      First lien senior secured loan   7.99% (Libor + 5.50%/M)   10/17/2023           30.8  

                             

Beacon RNG LLC

  Owner of natural gas   Class B units             57.57 %   35.0  

7913 Westpark Drive

  facilities                          

Suite 101

                             

Mclean, VA 22102

                             

                             

Blue Angel Buyer 1, LLC and

  Distributor of OEM   First lien senior secured       1/2/2024           (27)

Blue Angel Holdco, LLC(3)

  appliance   revolving loan                      

One City Palace

  aftermarket parts   First lien senior secured loan       1/2/2025           (28)

St. Louis, MO 63141

      First lien senior secured loan   7.06% (Libor + 4.25%/Q)   1/2/2025           9.7  

      Class A preferred units   8.00% PIK         5.45 %   9.7  

                             

Blue Campaigns Intermediate Holding Corp.

  Provider of fundraising and   First lien senior secured       8/18/2023           (29)

and Elevate Parent, Inc. (dba EveryAction)

  organizing efforts and digital   revolving loan                      

1445 New York Avenue. NW

  services to non-profits and   First lien senior secured loan   9.39% (Libor + 6.75%/Q)   8/18/2023           27.5  

Suite 200

  political campaigns   Series A preferred stock             1.60 %   1.7  

Washington DC, DC 20005

                             

                             

Blue Wolf Capital Fund II, L.P.(3)(5)

  Investment partnership   Limited partnership interest             8.50 %   2.5  

48 Wall Street

                             

31st Floor

                             

New York, NY 10005

                             

                             

Bragg Live Food Products, LLC and

  Health food company   First lien senior secured       3/11/2024           (30)

SPC Investment Co., L.P.(3)

      revolving loan                      

PO Box 7

      First lien senior secured loan   8.35% (Libor + 5.75%/Q)   3/11/2024           36.6  

Santa Barbara, CA 93102

      Common units             8.80 %   14.9  

                             

BRG Sports, Inc.

  Designer, manufacturer and   Preferred stock             1.65 %   0.2  

669 Sugar Lane

  licensor of branded   Common stock             1.28 %    

Elyria, OH 44035

  sporting goods                          

                             

Cadence Aerospace, LLC

  Aerospace precision   First lien senior secured   9.10% (Libor + 6.50%/Q)   11/14/2022           0.7 (31)

2600 94th Street SW

  components manufacturer   revolving loan                      

Suite 150

      First lien senior secured   11.00% (Base Rate + 5.50%/Q)   11/14/2022           3.0 (31)

Everett, WA 98204

      revolving loan                      

      First lien senior secured loan   9.09% (Libor + 6.50%/Q)   11/14/2023           31.8  

      First lien senior secured loan   9.10% (Libor + 6.50%/Q)   11/14/2023           9.9  

                             

CallMiner, Inc.

  Provider of cloud-based   Warrant       7/23/2024     1.83 %   (2)

200 West Street

  conversational analytics                          

Waltham, MA 02452

  solutions                          

                             

Capstone Logistics Acquisition, Inc.

  Outsourced supply chain   First lien senior secured       4/7/2021           (32)

6525 The Corners Parkway

  solutions provider to   revolving loan                      

Suite 520

  operators of distribution                          

Peachtree Corners, GA 30092

  centers                          

                             

Care Hospice, Inc

  Provider of hospice services   First lien senior secured   7.38% (Libor + 4.75%/Q)   4/12/2022           0.6 (33)

500 Faulconer Drive

      revolving loan                      

Suite 200

      First lien senior secured   7.23% (Libor + 4.75%/M)   4/12/2022           0.3 (33)

Charlottesville, VA 22903

      revolving loan                      

      First lien senior secured revolving loan   7.23% (Libor + 4.75%/M)   4/12/2022           0.3 (33)

                             

122


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  

Carlyle Global Market Strategies CLO 2015-3(5)

  Investment vehicle   Subordinated notes   16.00%   7/28/2028           14.0  

190 Elgin Avenue

                             

George Town, Grand Cayman KY1-9005

                             

Cayman Islands

                             

                             

CB Trestles OpCo, LLC

  Apparel retailer   First lien senior secured   8.45% (Libor + 5.75%/Q)   10/26/2024           4.0 (34)

5935 Darwin Ct

      revolving loan                      

Carlsbad, CA 92008

      First lien senior secured loan   8.51% (Libor + 5.75%/S)   10/26/2024           26.2  

                             

CCS-CMGC Holdings, Inc.

  Correctional facility   First lien senior secured   8.00% (Libor + 5.50%/M)   10/2/2023           1.8 (35)

1283 Murfreesboro Rd

  healthcare operator   revolving loan                      

Suite 500

      First lien senior secured loan   8.00% (Libor + 5.50%/M)   10/1/2025           34.6  

Nashville, TN 37217

                             

                             

Center for Autism and Related

  Autism treatment and   First lien senior secured       11/21/2023           (36)

Disorders, LLC

  services provider specializing   revolving loan                      

21600 Oxnard Street

  in applied behavior analysis                          

Suite 1800

  therapy                          

Woodland Hills, CA 91367

                             

                             

Centric Brands Inc. (fka Differential Brands

  Designer, marketer and   First lien senior secured   10.00% (Base Rate + 4.50%/Q)   4/29/2023           (37)

Group Inc.)(5)

  distributor of licensed   revolving loan                      

350 5th Avenue

  and owned apparel   First lien senior secured loan   8.75% (Libor + 6.00%/Q)   10/29/2023           58.1  

6th Floor

      Common stock                   24.6  

New York, NY 10118

                             

                             

CFW Co-Invest, L.P. and NCP Curves, L.P.

  Health club franchisor   Limited partnership interest             12.24 %   11.9  

100 Ritchie Road

      Limited partnership interest             7.41 %   (5)

Waco, TX 76712

                             

                             

ChargePoint, Inc.

  Developer and operator of   Warrant       12/24/2024     3.70 %   3.0 (2)

1692 Dell Avenue

  electric vehicle charging                          

Campbell, CA 95008

  stations                          

                             

Chariot Acquisition, LLC

  Manufacturer of aftermarket   First lien senior secured       9/30/2021           (38)

3510 Port Jacksonville Pkwy

  golf cart parts and accessories   revolving loan                      

Jacksonville, FL 32226

      First lien senior secured loan   9.10% (Libor + 6.50%/Q)   9/30/2021           18.0  

      First lien senior secured loan   9.10% (Libor + 6.50%/Q)   9/30/2021           9.1  

                             

Chesapeake Research Review, LLC

  Provider of central   First lien senior secured       11/7/2023           (39)

and Schulman Associates

  institutional   revolving loan                      

Institutional Review Board, Inc.

  review boards over clinical   First lien senior secured loan   8.35% (Libor + 5.75%/Q)   11/7/2023           3.8  

6940 Columbia Gateway Drive

  trials                          

Suite 110

                             

Columbia, MD 21046

                             

                             

CHG PPC Parent LLC

  Diversified food products   Second lien senior secured   10.25% (Libor + 7.75%/M)   3/30/2026           33.8  

2201 Broadway

  manufacturer   loan                      

San Antonio, TX 78215

      Second lien senior secured loan   10.00% (Libor + 7.50%/M)   3/30/2026           59.6  

                             

Cipriani USA, Inc.

  Manager and operator of   First lien senior secured loan   10.50% (Libor + 6.00% Cash,   5/30/2023           3.0  

110 E 42nd Street

  banquet facilities,       2.00% PIK/Q)                  

New York, NY 10017

  restaurants, hotels and   First lien senior secured loan   10.50% (Libor + 6.00% Cash,   5/30/2023           12.1  

  other leisure properties       2.00% PIK/Q)                  

      First lien senior secured loan   10.50% (Libor + 6.00% Cash, 2.00% PIK/Q)   5/30/2023           3.0  

      First lien senior secured loan   10.50% (Libor + 6.00% Cash, 2.00% PIK/Q)   5/30/2023           68.1  

                             

Clearwater Analytics, LLC

  Provider of integrated   First lien senior secured       9/1/2022           (40)

777 W. Main Street

  cloud-based investment   revolving loan                      

Suite 900

  portfolio management,                          

Boise, ID 83702

  accounting, reporting                          

  and analytics software                          

                             

CMW Parent LLC (fka Black Arrow, Inc.)

  Multiplatform media firm   Series A units             0.00 %    

65 North San Pedro

                             

San Jose, CA 95110

                             

                             

CoLTs 2005-1 Ltd.(4)(5)

  Investment vehicle   Preferred shares                    

P.O. Box 908 Mary Street

                             

GT Walker House

                             

George Town, Grand Cayman

                             

Cayman Islands

                             

                             

CoLTs 2005-2 Ltd.(4)(5)

  Investment vehicle   Preferred shares                    

P.O. Box 908 Mary Street

                             

GT Walker House

                             

George Town, Grand Cayman

                             

Cayman Islands

                             

                             

123


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  

Command Alkon Incorporated

  Software solutions provider to   First lien senior secured   9.50% (Base Rate + 4.00%/M)   9/1/2022           4.0 (41)

1800 International Park Drive

  the ready-mix concrete   revolving loan                      

Suite 400

  industry   First lien senior secured loan   7.49% (Libor + 5.00%/M)   9/1/2023           19.7  

Birmingham, AL 35243

      Second lien senior secured loan   11.49% (Libor + 9.00%/M)   3/1/2024           31.7  

                             

Commercial Credit Group, Inc.

  Commercial equipment   Senior subordinated loan   12.24% (Libor + 9.75%/M)   8/31/2022           28.0  

227 Waste trade Street

  finance and leasing company                          

Suite 1450

                             

Charlotte, NC 28202

                             

                             

Comprehensive EyeCare Partners, LLC

  Vision care practice   First lien senior secured   7.31% (Libor + 4.50%/Q)   2/14/2024           0.1 (42)

1256 Main Street

  management company   revolving loan                      

Suite 256

      First lien senior secured   7.31% (Libor + 4.50%/Q)   2/14/2024           0.2 (42)

South Lake, TX 76092

      revolving loan                      

      First lien senior secured loan       2/14/2024           (43)

      First lien senior secured loan   7.12% (Libor + 4.50%/Q)   2/14/2024           2.4  

      First lien senior secured loan   7.12% (Libor + 4.50%/Q)   2/14/2024           5.4  

                             

Compuware Parent, LLC

  Web and mobile cloud   Class A-1 common stock             0.41 %   2.2  

777 Mariners Island Blvd

  performance testing and   Class B-1 common stock             0.41 %   0.4  

San Mateo, CA 94404

  monitoring services provider   Class C-1 common stock             0.41 %   0.3  

      Class A-2 common stock             0.41 %    

      Class B-2 common stock             0.41 %    

      Class C-2 common stock             0.41 %    

                             

Consumer Health Parent LLC

  Developer and marketer of   Preferred units             0.94 %   0.3  

8515 E. Anderson Dr.

  over-the-counter cold remedy   Series A units             0.94 %    

Scottsdale, AZ 85255

  products                          

                             

Corepoint Health, LLC

  Provider of data integration   First lien senior secured       2/17/2020           (44)

3010 Gaylord Parkway

  and health information   revolving loan                      

Suite 320

  exchange solutions to the                          

Frisco, TX 75034

  healthcare industry                          

                             

Cozzini Bros., Inc. and BH-Sharp Holdings LP

  Provider of commercial knife   First lien senior secured   8.06% (Libor + 5.50%/Q)   3/10/2023           2.0 (45)

350 Howard Avenue

  sharpening and cutlery   revolving loan                      

Des Plaines, IL 60018

  services in the restaurant   First lien senior secured   10.00% (Base Rate + 4.50%/Q)   3/10/2023           1.5 (45)

  industry   revolving loan                      

      First lien senior secured loan   8.06% (Libor + 5.50%/Q)   3/10/2023           11.6  

      Common units             3.24 %   3.7  

                             

CPV Maryland Holding Company II, LLC

  Gas turbine power generation   Senior subordinated loan   12.00% PIK   12/31/2020           49.5  

c/o Competitive Power Ventures, Inc.

  facilities operator                          

8403 Colesville Road

                             

Suite 915

                             

Silver Spring, MD 20910

                             

                             

CREST Exeter Street Solar 2004-1(5)

  Investment vehicle   Preferred shares                    

P.O. Box 908 Mary Street

                             

GT Walker House

                             

George Town, Grand Cayman

                             

Cayman Islands

                             

                             

Crown Health Care Laundry Services, LLC

  Provider of outsourced   First lien senior secured       12/20/2021           (46)

and Crown Laundry Holdings, LLC(3)

  healthcare linen management   revolving loan                      

1501 North Guillemard Street

  solutions   First lien senior secured loan       12/20/2021           (47)

Pensacola, FL 32501

      First lien senior secured loan   8.75% (Libor + 6.25%/M)   12/20/2021           11.8  

      First lien senior secured loan   8.75% (Libor + 6.25%/M)   12/20/2021           11.9  

      First lien senior secured loan   8.75% (Libor + 6.25%/M)   12/20/2021           10.1  

      First lien senior secured loan   8.75% (Libor + 6.25%/M)   12/20/2021           11.0  

      Class A preferred units             10.59 %   3.4  

      Class B common units             10.59 %   1.3  

                             

CST Buyer Company (d/b/a Intoxalock)

  Provider of ignition interlock   First lien senior secured       3/1/2023           (48)

11035 Aurora Ave

  devices   revolving loan                      

Des Moines, IA 50325

                             

                             

D4C Dental Brands HoldCo, Inc.

  Dental services provider   First lien senior secured       12/21/2022           (49)

and Bambino Group Holdings, LLC

      revolving loan                      

1350 Spring Street NW

      Class A preferred units   8.00% PIK         0.64 %   1.0  

Suite 600

                             

Atlanta, GA 30353

                             

                             

Datix Bidco Limited(5)

  Global healthcare software   First lien senior secured loan   7.28% (Libor + 4.50%/S)   4/28/2025           2.9  

11 Worple Road

  company that provides   First lien senior secured loan   7.28% (Libor + 4.50%/S)   4/28/2025           2.9  

Wimbledon, London SW19 4JS

  software solutions for patient                          

United Kingdom

  safety and risk management                          

                             

DCA Investment Holding, LLC

  Multi-branded dental practice   First lien senior secured   9.75% (Base Rate + 4.25%/Q)   7/2/2021           0.1 (50)

6240 Lake osprey drive

  management   revolving loan                      

Sarasota, FL 34240

      First lien senior secured loan   7.85% (Libor + 5.25%/Q)   7/2/2021           18.5  

                             

124


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  

DecoPac, Inc.

  Supplier of cake decorating   First lien senior secured       9/29/2023           (51)

3500 Thurston Avenue

  solutions and products to   revolving loan                      

Anoka, MN 55303

  in-store bakeries                          

                             

Dent Wizard International Corporation and

  Automotive reconditioning   Second lien senior secured   10.50% (Libor + 8.00%/M)   10/7/2020           45.0  

DWH Equity Investors, L.P.

  services   loan                      

4710 Earth City Expressway

      Class A common stock             0.44 %   0.7  

Bridgeton, MO 63044

      Class B common stock             0.37 %   1.5  

                             

DFC Global Facility Borrower II LLC(5)

  Non-bank provider of   First lien senior secured   13.24% (Libor + 10.75%/M)   9/27/2022           94.6 (52)

74 E Swedesford Road

  alternative financial services   revolving loan                      

Suite 150

                             

Malvern, PA 19355

                             

                             

DFS Holding Company, Inc.

  Distributor of maintenance,   First lien senior secured loan   8.25% (Libor + 5.75%/M)   3/1/2022           4.5  

607 W Dempster Street

  repair, and operations parts,   First lien senior secured loan   8.25% (Libor + 5.75%/M)   2/17/2022           64.3  

Mount Prospect, IL 60056

  supplies, and equipment to   First lien senior secured loan   8.25% (Libor + 5.75%/M)   2/17/2022           91.4  

  the foodservice industry   First lien senior secured loan   8.25% (Libor + 5.75%/M)   2/17/2022           19.5  

                             

DGH Borrower LLC

  Developer, owner and   First lien senior secured loan       6/8/2023           (53)

358 North Shore Drive

  operator of quick start, small-   First lien senior secured loan   9.10% (Libor + 6.50%/Q)   6/8/2023           52.3  

Suite 201

  scale natural gas-fired power                          

Pittsburgh, PA 15212

  generation projects                          

                             

Directworks, Inc. and Co-Exprise

  Provider of cloud-based   First lien senior secured loan       4/1/2018            

Holdings, Inc.

  software solutions for direct   Warrant       12/19/2024     4.76 %   (2)

6021 Wallace Road

  materials sourcing and                          

Suite 300

  supplier management for                          

Wexford, PA 15090

  manufacturers                          

                             

Display Holding Company, Inc.,

  Provider of visual   First lien senior secured   9.25% (Base Rate + 3.75%/Q)   3/13/2024           0.1 (54)

Saldon Holdings, Inc.

  communications solutions   revolving loan                      

and Fastsigns Holdings Inc.

      First lien senior secured loan   7.25% (Libor + 4.75%/M)   3/13/2025           16.3  

2542 Highlander Way

      Common units             60.00 %   0.6  

Carrollton, TX 75006

                             

                             

Dorner Holding Corp.

  Manufacturer of precision   First lien senior secured       3/15/2022           (55)

975 Cottonwood Avenue

  unit conveyors   revolving loan                      

Hartland, WI 53029

                             

                             

Doxim Inc.(5)

  Enterprise content   First lien senior secured loan       2/28/2024           (56)

1380 Rodick Road

  management provider   First lien senior secured loan   8.48% (Libor + 6.00%/M)   2/28/2024           0.6  

Suite 102

      First lien senior secured loan   8.61% (Libor + 6.00%/Q)   2/28/2024           4.2  

Markham, ON L3R 4G5

      First lien senior secured loan   8.60% (Libor + 6.00%/Q)   2/28/2024           10.2  

Canada

                             

                             

DRB Holdings, LLC

  Provider of integrated   First lien senior secured   8.61% (Libor + 6.00%/Q)   10/6/2023           3.3 (57)

3245 Pickle Road

  technology solutions   revolving loan                      

Akron, OH 44312

  to car wash operators   First lien senior secured revolving loan   10.50% (Base Rate + 5.00%/S)   10/6/2023           2.0 (57)

      First lien senior secured loan   8.60% (Libor + 6.00%/Q)   10/6/2023           23.7  

                             

DTI Holdco, Inc. and

  Provider of legal process   First lien senior secured   7.00% (Libor + 4.50%/M)   9/30/2021           0.9 (58)

OPE DTI Holdings, Inc.

  outsourcing and managed   revolving loan                      

2 Ravinia Drive

  services   First lien senior secured   6.99% (Libor + 4.50%/M)   9/30/2021           1.3 (58)

Suite 850

      revolving loan                      

Atlanta, GA 30346

      Class A common stock             0.86 %   7.4  

      Class B common stock             0.86 %    

                             

Eaton Vance CDO X plc(5)

  Investment vehicle   Subordinated notes       2/22/2027            

85 Merrion Square

                             

Dublin 2

                             

Ireland

                             

                             

ECI Purchaser Company, LLC

  Manufacturer of equipment   First lien senior secured loan   9.13% (Libor + 6.25%/S)   12/31/2019           21.5  

890 Winter Street

  to safely control pressurized   First lien senior secured loan   9.15% (Libor + 6.25%/S)   12/31/2019           87.8  

Suite 130

  gases   First lien senior secured loan   9.15% (Libor + 6.25%/S)   12/31/2019           74.0  

Waltham, MA 02451

      First lien senior secured loan   9.13% (Libor + 6.25%/S)   12/31/2019           0.3  

      First lien senior secured loan   9.13% (Libor + 6.25%/S)   12/31/2019           0.2  

                             

Eckler Industries, Inc. and

  Restoration parts and   First lien senior secured   12.00% PIK   5/25/2022           2.8 (59)

Eckler Purchaser LLC(4)

  accessories provider for   revolving loan                      

5200 S. Washington Ave

  classic automobiles   First lien senior secured loan   12.00% PIK   5/25/2022           18.8  

Titusville, FL 32780

      Class A preferred units             67.97 %   0.5  

      Class A common units             67.97 %    

                             

Edward Don & Company, LLC and

  Distributor of foodservice   Membership units             2.02 %   4.2  

VCP-EDC Co-Invest, LLC

  equipment and supplies                          

9801 Adam Don Pkwy

                             

Woodridge, IL 60517

                             

                             

Emergency Communications Network, LLC

  Provider of mission critical   First lien senior secured       6/1/2022           (60)

780 W Granada Blvd

  emergency mass notification   revolving loan                      

Ormond Beach, FL 32174

  solutions   First lien senior secured loan   8.75% (Libor + 6.25%/M)   6/1/2023           24.1  

      First lien senior secured loan   8.75% (Libor + 6.25%/M)   6/1/2023           18.9  

                             

125


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  

Emerus Holdings, Inc.

  Freestanding 24-hour   First lien senior secured       9/1/2020           (61)

82330 North Loop 1604 W

  emergency care   revolving loan                      

San Antonio, TX 78249

  micro-hospitals operator   First lien senior secured loan   14.00%   2/28/2022           16.5  

                             

EN Engineering, L.L.C.

  National utility services firm   First lien senior secured       6/30/2021           (62)

28100 Torch Parkway

  providing engineering and   revolving loan                      

Suite 400

  consulting services to natural                          

Warrenville, IL 60555

  gas, electric power and other                          

  energy and industrial end                          

  markets                          

                             

Entertainment Partners, LLC and

  Provider of entertainment   First lien senior secured       5/8/2023           (63)

Entertainment Partners Canada Inc.

  workforce and production   revolving loan                      

2835 North Naomi Street

  management solutions   First lien senior secured loan       5/8/2023           (64)

Burbank, CA 91504

      First lien senior secured loan   7.47% (CIBOR + 5.50%/M)   5/8/2022           2.6 (5)

      First lien senior secured loan   7.69% (CIBOR + 5.50%/Q)   5/8/2022           0.9 (5)

      First lien senior secured loan   7.85% (CIBOR + 5.50%/S)   5/8/2022           2.6 (5)

      First lien senior secured loan   8.25% (Libor + 5.75%/M)   5/8/2023           21.8  

      First lien senior secured loan   8.49% (Libor + 5.75%/Q)   5/8/2023           26.4  

      First lien senior secured loan   8.59% (Libor + 5.75%/Q)   5/8/2023           26.4  

                             

Episerver Inc. and Goldcup 17308 AB

  Provider of web content   First lien senior secured       12/3/2019           (65)

542A Amherst Street

  management and digital   revolving loan                      

Route 101A

  commerce solutions   First lien senior secured       10/9/2024           (66)

Nashua, NH 03063

      revolving loan                      

      First lien senior secured loan   8.25% (Libor + 5.75%/M)   10/9/2024           27.4  

      First lien senior secured loan   8.61% (EURIBOR + 6.00%/Q)   10/9/2024           6.1 (5)

                             

ESCP PPG Holdings, LLC(3)

  Distributor of new equipment   Class A units             7.91 %   2.8  

8330 State Road

  and aftermarket parts to the                          

Philadelphia, PA 19136

  heavy-duty truck industry                          

                             

European Capital UK SME Debt LP(3)(5)

  Investment partnership   Limited partnership interest             45.00 %   39.6  

1st James's Market

                             

London LSW1Y 4AH

                             

United Kingdom

                             

                             

Everspin Technologies, Inc.

  Designer and manufacturer   Warrant       10/7/2026     3.98 %   (2)

1347 N Alma School Road

  of computer memory                          

Suite 220

  solutions                          

Chandler, AZ 85224

                             

                             

Excelligence Holdings Corp.

  Developer, manufacturer and   First lien senior secured loan   8.50% (Libor + 6.00%/M)   4/18/2023           7.8  

2 Lower Ragsdale Drive

  retailer of educational                          

#215

  products                          

Monterey, CA 93940

                             

                             

Extenet Systems, Inc.

  Provider of antenna networks   First lien senior secured   8.25% (Base Rate + 2.75%/Q)   11/13/2022           0.8 (67)

3030 Warrenville Road DuPage

  for use by wireless service   revolving loan                      

Suite 340

  providers, government                          

DuPage, IL 60532

  agencies, healthcare organizations and other commercial enterprises                          

                             

Feradyne Outdoors, LLC and Bowhunter Holdings, LLC

  Provider of branded archery and bowhunting accessories   Common units             3.20 %   0.2  

110 Beasley Road

                             

Cartersville, GA 30120

                             

                             

Ferraro Fine Foods Corp. and Italian Fine Foods Holdings L.P.

  Specialty Italian food distributor   First lien senior secured revolving loan   6.95% (Libor + 4.25%/Q)   5/9/2023           0.3 (68)

287 South Randolphville Road

      First lien senior secured   8.75% (Base Rate + 3.25%/Q)   5/9/2023           0.5 (68)

Piscataway, NJ 08854

      revolving loan                      

      First lien senior secured loan   6.85% (Libor + 4.25%/Q)   5/9/2024           0.7  

      First lien senior secured loan   6.95% (Libor + 4.25%/Q)   5/9/2024           9.4  

      Class A common units             1.12 %   3.5  

                             

Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.(3)

  Debt collection services provider   Common stock             18.00 %    

1967 Lakeside Parkway

                             

Suite 402

                             

Tucker, GA 30084

                             

                             

First Insight, Inc.

  Software company providing   Warrant       3/20/2024     0.88 %   (2)

1606 Carmody Court

  merchandising and pricing                          

Suite 106

  solutions to companies                          

Sewickley, PA 15143

  worldwide                          

126


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Flinn Scientific, Inc. and WCI-Quantum Holdings, Inc.   Distributor of instructional products, services and   First lien senior secured revolving loan       8/31/2023           (69)
770 N. Raddant Rd   resources   First lien senior secured loan   7.53% (Libor + 4.75%/Q)   8/31/2023           20.8  
Batavia, IL 60510       First lien senior secured loan   7.35% (Libor + 4.75%/Q)   8/31/2023           0.1  
        First lien senior secured loan   7.53% (Libor + 4.75%/S)   8/31/2023           25.4  
        First lien senior secured loan   7.58% (Libor + 4.75%/A)   8/31/2023           1.2  
        Series A preferred stock             1.27 %   1.0  
                             
Flow Control Solutions, Inc.   Distributor and manufacturer   First lien senior secured       11/21/2024           (70)
7869 Route 98   of flow control systems   revolving loan                      
Arcade, NY 14009   components   First lien senior secured loan       11/21/2024           (71)
        First lien senior secured loan   7.85% (Libor + 5.25%/Q)   11/21/2024           13.6  
                             
FM: Systems Group LLC   Provider of facilities and   First lien senior secured       1/31/2022           (72)
2301 Sugar Bush Road   space management software   revolving loan                      
Suite 500   solutions                          
Raleigh, NC 27612                              
                             
Foundation Risk Partners, Corp.   Full service independent   First lien senior secured   7.35% (Libor + 4.75%/Q)   11/10/2023           3.6 (73)
4634 Gulfstarr Drive   insurance agency   revolving loan                      
Destin, FL 32541       First lien senior secured loan   7.35% (Libor + 4.75%/Q)   11/10/2023           22.2  
        Second lien senior secured loan   11.20% (Libor + 8.50%/Q)   11/10/2024           6.3  
        Second lien senior secured loan   11.10% (Libor + 8.50%/Q)   11/10/2024           15.4  
        Second lien senior secured loan   11.10% (Libor + 8.50%/Q)   11/10/2024           19.1  
        Second lien senior secured loan   11.10% (Libor + 8.50%/Q)   11/10/2024           27.5  
                             
Frontline Technologies Group Holding LLC,   Provider of human capital   First lien senior secured loan       9/18/2023           (74)
Frontline Technologies Blocker Buyer, Inc.,   management and SaaS-based   First lien senior secured loan   9.10% (Libor + 6.50%/Q)   9/18/2023           1.9  
Frontline Technologies Holdings, LLC and   software solutions to   Class A preferred units   9.00% PIK         0.62 %   5.7  
Frontline Technologies Parent, LLC   employees and administrators   Class B common units             0.62 %    
1400 Atwater Drive   of K-12 school organizations                          
Malvern, PA 19355                              
                             
FS Squared Holding Corp. and   Provider of on-site vending   First lien senior secured       3/28/2024           (75)
FS Squared, LLC   and micro market solutions   revolving loan                      
6005 Century Oaks Dr #100       First lien senior secured loan       3/28/2025           (76)
Chattanooga, TN 37416       First lien senior secured loan   9.75% (Base Rate + 4.25%/Q)   3/28/2025           4.3  
        First lien senior secured loan   9.75% (Base Rate + 4.25%/Q)   3/28/2025           0.1  
        Class A units             3.62 %   10.0  
                             
FWR Holding Corporation   Restaurant owner, operator,   First lien senior secured   8.00% (Libor + 5.50%/M)   8/21/2023           0.5 (77)
8027 Cooper Creed Boulevard   and franchisor   revolving loan                      
#103       First lien senior secured loan       8/21/2023           (78)
University Park, FL 34201       First lien senior secured loan   8.00% (Libor + 5.50%/M)   8/21/2023           0.8  
        First lien senior secured loan   7.99% (Libor + 5.50%/M)   8/21/2023           0.5  
        First lien senior secured loan   8.00% (Libor + 5.50%/M)   8/21/2023           0.5  
        First lien senior secured loan   8.00% (Libor + 5.50%/M)   8/21/2023           4.0  
                             
Garden Fresh Restaurant Corp. and   Restaurant owner and   First lien senior secured       2/1/2022           (79)
GFRC Holdings LLC   operator   revolving loan                      
15822 Bernardo Center Drive       First lien senior secured loan   10.63% (Libor + 8.00%/Q)   2/1/2022           23.4  
Suite A                              
San Diego, CA 92127                              
                             
GB Auto Service Holdings, LLC   Automotive parts and repair   First lien senior secured       10/19/2024           (80)
2910 North Swan Road   services retailer   revolving loan                      
Suite 110       First lien senior secured loan       10/19/2024           (81)
Tucson, AZ 85712       First lien senior secured loan   8.49% (Libor + 6.00%/M)   10/19/2024           22.1  
        Common units             92.50 %   4.6  
                             
Gehl Foods, LLC and GF Parent LLC   Producer of low-acid, aseptic   Class A             2.58 %    
4757 Nexus Center Drive   food and beverage products   preferred units                      
San Diego, CA 92121       Class A common units             2.58 %    
        Class B common units             2.58 %    
                             
Genesis Acquisition Co. and   Child care management   First lien senior secured       7/31/2024           (82)
Genesis Holding Co.   software and services   revolving loan                      
1 West Main Street   provider   First lien senior secured loan       7/31/2024           (83)
Ste 201       First lien senior secured loan   6.60% (Libor + 4.00%/Q)   7/31/2024           5.5  
Medford, OR 97501       Second lien senior secured loan       7/31/2025           (84)
        Second lien senior secured loan   10.24% (Libor + 7.50%/Q)   7/31/2025           25.8  
        Class A common stock             7.99 %   0.8  
                             
Genomatica, Inc.   Developer of a biotechnology   Warrant       3/28/2023     0.70 %   (2)
100 Acorn Park Drive   platform for the production                          
Cambridge Discovery Park 5th Floor   of chemical products                          
Cambridge, MA 02140                              
                             

127


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
GHX Ultimate Parent Corporation, Commerce   On-demand supply chain   Second lien senior secured   10.60% (Libor + 8.00%/Q)   6/30/2025           34.5  
Parent, Inc. and Commerce Topco, LLC   automation solutions provider   loan                      
1315 W Century Drive   to the healthcare industry   Series A preferred stock   13.55% PIK (Libor + 10.95%)         64.15 %   138.1  
Suite 100       Class A units             1.34 %   16.7  
Louisville, CO 80027                              
                             
Gordian Group, LLC   Provider of products, services   Common stock             5.00 %    
950 Third Avenue   and software to organizations                          
17th Floor   pursuing efficient and                          
New York, NY 10022   effective procurement and                          
    information solutions                          
                             
Graphpad Software, LLC   Provider of data analysis,   First lien senior secured       12/21/2023           (85)
7825 Fay Avenue #230   statistics, and visualization   revolving loan                      
La Jolla, CA 92037   software solutions for                          
    scientific research applications                          
                             
Green Energy Partners, Stonewall LLC and   Gas turbine power generation   First lien senior secured loan   8.10% (Libor + 5.50%/Q)   11/13/2021           24.6  
Panda Stonewall Intermediate   facilities operator   Senior subordinated loan   13.25%   12/31/2021           20.6  
Holdings II LLC       Senior subordinated loan   13.25%   12/31/2021           96.5  
12 Paoli Pike                              
Suite 5                              
Paoli, PA 19301                              
                             
Greenphire, Inc. and   Software provider for clinical   Limited partnership interest       12/29/2024     99.90 %   3.3  
RMCF III CIV XXIX, L.P   trial management                          
640 Freedom Business Center Drive                              
Suite 201                              
King of Prussia, PA 19406                              
                             
GS Pretium Holdings, Inc.   Manufacturer and supplier of   Common stock             0.41 %   1.1  
15450 South Outer Forty Drive   high performance plastic                          
Suite 120   containers                          
Chesterfield, MO 63017                              
                             
GTCR-Ultra Holdings III, LLC and   Provider of payment   First lien senior secured       8/1/2022           (86)
GTCR-Ultra Holdings LLC   processing and merchant   revolving loan                      
12120 Sunset Hills Road   acquiring solutions   First lien senior secured loan   7.75% (Libor + 5.25%/M)   8/1/2024           6.5  
500 Reston, VA 20190       Class A-2 units             0.83 %   1.3  
        Class B units             0.82 %    
                             
H-Food Holdings, LLC and   Food Contract Manufacturer   First lien senior secured loan   6.50% (Libor + 4.00%/M)   5/23/2025           19.6  
Matterhorn Parent, LLC       Second lien senior secured   9.50% (Libor + 7.00%/M)   3/2/2026           71.6  
3500 Lacey Road       loan                      
Suite 300       Common units             0.43 %   5.8  
Downers Grove, IL 60515                              
                             
HAI Acquisition Corporation and Aloha   Professional employer   First lien senior secured       11/1/2023           (87)
Topco, LLC   organization offering human   revolving loan                      
6600 Kalanianaole Hwy   resources, compliance and   First lien senior secured loan   8.74% (Libor + 6.00%/Q)   11/1/2024           66.0  
Suite 200   risk management services   Class A units             0.82 %   2.1  
Honolulu, HI 96825                              
                             
Halex Holdings, Inc.(4)   Manufacturer of flooring   First lien senior secured       12/31/2018           (88)
4200 Santa Ana Street   installation products   revolving loan                      
Ontario, CA 91761       Common stock             100.00 %    
                             
Harvey Tool Company, LLC   Manufacturer of cutting tools   First lien senior secured   7.00% (Libor + 4.50%/M)   10/12/2023           0.4 (89)
428 Newburyport Turnpike   to the metalworking industry   revolving loan                      
Rowley, MA 01969       First lien senior secured loan       10/12/2024           (90)
        First lien senior secured loan   7.62% (Libor + 4.75%/S)   10/12/2024           4.9  
        First lien senior secured loan   7.35% (Libor + 4.75%/Q)   10/12/2024           30.6  
        Second lien senior secured loan       10/12/2025           (91)
        Second lien senior secured loan   11.30% (Libor + 8.50%/Q)   10/12/2025           43.7  
                             
HCI Equity, LLC(4)(5)   Investment company   Member interest             100.00 %   0.1  
2000 Avenue of the Stars                              
12th Floor                              
Los Angeles, CA 90067                              
                             
Help/Systems Holdings, Inc.   Provider of IT operations   First lien senior secured       3/29/2023           (92)
6455 City West ParkWay   management and   revolving loan                      
Eden Prairie, MN 55344   cybersecurity software                          
                             
Herbert Park B.V.(5)   Investment vehicle   Subordinated notes       10/20/2026            
238 Herikerbergweg                              
Luna Arena, 1101 CM                              
Amsterdam, Zuidoost                              
The Netherlands                              
                             

128


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Heritage Food Service Group, Inc. and   Distributor of repair and   Second lien senior secured   11.06% (Libor + 8.50%/Q)   10/20/2022           31.6  
WCI-HFG Holdings, LLC   replacement parts for   loan                      
5130 Executive Boulevard   commercial kitchen   Preferred units   8.00% PIK         2.50 %   4.5  
Fort Wayne, IN 46808   equipment                          
                             
Hometown Food Company   Food distributor   First lien senior secured   7.75% (Libor + 5.25%/M)   8/31/2023           0.2 (93)
500 W Madison street       revolving loan                      
Chicago, IL 60661       First lien senior secured loan   7.75% (Libor + 5.25%/M)   8/31/2023           9.0  
                             
Hygiena Borrower LLC
941 Avenida Acaso
  Adenosine triphosphate
testing technology provider
  First lien senior secured
revolving loan
      8/26/2022           (94)
Carmarillo, CA 93012       First lien senior secured loan       8/26/2022           (95)
        First lien senior secured loan   6.60% (Libor + 4.00%/Q)   8/26/2022           9.5  
        Second lien senior secured loan       8/26/2023           (96)
        Second lien senior secured loan   10.35% (Libor + 7.75%/Q)   8/26/2023           11.1  
        Second lien senior secured loan   10.35% (Libor + 7.75%/Q)   8/26/2023           0.6  
        Second lien senior secured loan   10.35% (Libor + 7.75%/Q)   8/26/2023           2.5  
        Second lien senior secured loan   10.35% (Libor + 7.75%/Q)   8/26/2023           10.7  
                             
IfByPhone Inc.   Voice-based marketing   Warrant       10/15/2022     5.00 %   0.1 (2)
300 W. Adams Street   automation software provider                          
Suite 900                              
Chicago, IL 60606                              
                             
Imaging Business Machines, L.L.C. and   Provider of high-speed   Senior subordinated loan   14.00%   6/15/2022           8.3  
Scanner Holdings Corporation(4)   intelligent document scanning   Senior subordinated loan   14.00%   6/15/2022           8.3  
2750 Crestwood Blvd   hardware and software   Series A preferred stock             85.81 %   7.0  
Birmingham, AL 35210       Class A common stock             8.19 %    
        Class B common stock             8.19 %    
                             
IMIA Holdings, Inc.   Marine preservation   First lien senior secured       10/26/2024           (97)
7884 Spanish Fort Blvd   maintenance company   revolving loan                      
Spanish Fort, AL 36527       First lien senior secured loan   7.10% (Libor + 4.50%/Q)   10/26/2024           2.8  
        First lien senior secured loan   7.10% (Libor + 4.50%/Q)   10/26/2024           18.0  
                             
Implementation Management Assistance, LLC   Revenue cycle consulting   First lien senior secured   7.10% (Libor + 4.50%/Q)   12/13/2023           10.1 (98)
3 Dickinson Drive   firm to the   revolving loan                      
Suite 200   healthcare industry   First lien senior secured loan       12/13/2023           (99)
Chadds Ford, PA 19317       First lien senior secured loan   7.10% (Libor + 4.50%/Q)   12/13/2023           16.6  
                             
Implus Footcare, LLC   Provider of footwear and   First lien senior secured loan   9.35% (Libor + 6.75%/Q)   4/30/2021           14.1  
2001 T.W. Alexander Drive   other accessories   First lien senior secured loan   9.35% (Libor + 6.75%/Q)   4/30/2021           5.0  
Box 13925       First lien senior secured loan   9.35% (Libor + 6.75%/Q)   4/30/2021           64.8  
Durham, NC 27709-3925       First lien senior secured loan   9.35% (Libor + 6.75%/Q)   4/30/2021           30.7  
        First lien senior secured loan   9.38% (Libor + 6.75%/Q)   4/30/2021           0.2  
                             
Indra Holdings Corp.   Designer, marketer, and   First lien senior secured loan   6.83% (Libor + 4.25%/Q)   5/1/2021           6.1  
9655 International Blvd   distributor of rain   Second lien senior secured       11/1/2021           15.0  
Cincinnati, OH 45246   and cold weather products   loan                      
                             
Infilaw Holding, LLC   Operator of for-profit law   First lien senior secured       2/1/2018           (100)
1100 5th Avenue South   schools   revolving loan                      
Suite 301                              
Naples, FL 34102                              
                             
Infinite Electronics, Inc.   Manufacturer and   First lien senior secured       7/3/2023           (101)
17802 Fitch   distributor of radio   revolving loan                      
Irvine, CA 92614   frequency and microwave   First lien senior secured loan   6.50% (Libor + 4.00%/M)   7/2/2025           10.3  
    electronic components                          
                             
Infogix, Inc. and Infogix Parent Corporation   Enterprise data analytics and   First lien senior secured       4/30/2024           (102)
1240 E. Diehl Rd   integrity software solutions   revolving loan                      
Suite 400   provider   Series A preferred stock   9.00% PIK         1.47 %   2.5  
Naperville, IL 60563       Common stock             1.47 %    
                             
Inmar, Inc.   Technology-driven solutions   First lien senior secured loan   6.60% (Libor + 4.00%/Q)   5/1/2024           25.4  
2601 Pilgrim CourtWinston   provider for retailers,   Second lien senior secured   10.60% (Libor + 8.00%/Q)   5/1/2025           27.4  
Salem, NC 27106   wholesalers and   loan                      
    manufacturers                          
                             
Instituto de Banca y Comercio, Inc. &   Private school operator   First lien senior secured loan   11.74% (Libor + 9.00%/Q)   10/31/2020           12.3  
Leeds IV Advisors, Inc.       Series B preferred stock             5.00 %    
1660 Calle Santa Ana       Series C preferred stock             3.98 %    
Santurce, Puerto Rico 00909       Series B preferred stock                    
        Series C preferred stock                    
        Senior preferred series A-1 shares             83.50 %   18.8  
        Common stock                    
        Common stock             4.02 %    
                             

129


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
InterVision Systems, LLC and   Provider of cloud based IT   First lien senior secured loan   10.26% (Libor + 7.77%/M)   5/31/2022           15.5  
InterVision Holdings, LLC   solutions, infrastructure and   First lien senior secured loan   10.97% (Libor + 8.47%/M)   5/31/2022           23.5  
2270 Martin Avenue   services   First lien senior secured loan   10.97% (Libor + 8.47%/M)   5/31/2022           9.5  
Santa Clara, CA 95050       Class A membership units             2.50 %   0.4  
                             
IntraPac International LLC and   Manufacturer of diversified   First lien senior secured   8.06% (Libor + 5.50%/Q)   1/13/2025           0.8 (103)
IntraPac Canada Corporation   packaging solutions and   revolving loan                      
136 Fairview Road   plastic injection molded   First lien senior secured   8.20% (Libor + 5.50%/Q)   1/13/2025           2.5 (103)
Suite 320   products   revolving loan                      
Mooresville, NC 28117       First lien senior secured loan   8.20% (Libor + 5.50%/M)   1/12/2026           22.8 (5)
        First lien senior secured loan   8.20% (Libor + 5.50%/M)   1/12/2026           44.7  
                             
Invoice Cloud, Inc.   Provider of electronic   First lien senior secured       2/11/2024           (104)
35 Braintree Hill   payment processing   revolving loan                      
Office Park   solutions   First lien senior secured loan       2/11/2024           (105)
Braintree, MA 02184       First lien senior secured loan   9.20% (Libor + 6.50%/Q)   2/11/2024           32.1  
                             
Ioxus, Inc.(3)   Energy storage devices   First lien senior secured loan       12/30/2019           1.4  
18 Stadium Circle       First lien senior secured loan   9.00% Cash, 3.00% PIK   12/30/2019           5.7  
Oneonta, NY 13820       Series CC preferred stock                    
        Warrant       1/27/2026     19.49 %   (2)
        Warrant       8/24/2026     19.49 %   (2)
        Warrant       1/27/2027     5.51 %   (2)
                             
iParadigms Holdings, LLC   Anti-plagiarism software   Second lien senior secured   9.85% (Libor + 7.25%/Q)   7/29/2022           32.5  
1111 Broadway   provider to the education   loan                      
3rd Floor   market                          
Oakland, CA 94607                              
                             
iPipeline, Inc., Internet Pipeline, Inc., iPipeline   Provider of SaaS-based   First lien senior secured       8/4/2021           (106)
Limited and iPipeline Holdings, Inc.   software solutions to the   revolving loan                      
222 Valley Creek Blvd   insurance and financial   First lien senior secured loan   7.25% (Libor + 4.75%/M)   8/4/2022           11.4 (5)
Suite 300   services industry   First lien senior secured loan   7.25% (Libor + 4.75%/M)   8/4/2022           7.4  
Exton, PA 19341       First lien senior secured loan   7.25% (Libor + 4.75%/M)   8/4/2022           5.0  
        First lien senior secured loan   7.25% (Libor + 4.75%/M)   8/4/2022           16.2  
        First lien senior secured loan   7.25% (Libor + 4.75%/M)   8/4/2022           14.5  
        Preferred stock             0.73 %   5.2  
        Common stock             0.64 %   0.1  
                             
IRI Holdings, Inc., IRI Group Holdings, Inc.   Market research company   First lien senior secured loan   7.13% (Libor + 4.50%/Q)   11/30/2025           30.9  
and IRI Parent, L.P.   focused on the consumer   First lien senior secured loan   7.13% (Libor + 4.50%/Q)   11/30/2025           34.2  
150 North Clinton Street   packaged goods industry   Second lien senior secured   10.63% (Libor + 8.00%/Q)   11/30/2026           85.1  
Chicago, IL 60661       loan                      
        Series A-1 preferred shares   13.39% PIK (Libor + 10.79%)         23.45 %   49.0  
        Class A-1 common units             1.26 %   9.1  
                             
Ivy Hill Asset Management, L.P.(4)(5)   Asset management services   Member interest             100.00 %   534.0  
245 Park Avenue                              
44th Floor                              
New York, NY 10167                              
                             
Javlin Three LLC, Javlin Four LLC, and   Asset-backed financial   First lien senior secured loan       6/24/2017           8.5  
Javlin Five LLC(5)   services company                          
1414 Harney Street                              
Suite 440                              
Omaha, NE 68102                              
                             
JDC Healthcare Management, LLC   Dental services provider   First lien senior secured   10.24% (Libor + 7.75%/M)   4/11/2022           0.8 (107)
3030 Lyndon B Johnson       revolving loan                      
Fwy #1400       First lien senior secured   10.25% (Libor + 7.75%/M)   4/11/2022           0.8 (107)
Dallas, TX 75231       revolving loan                      
        First lien senior secured loan       4/10/2023           (108)
        First lien senior secured loan   10.24% (Libor + 6.75% Cash, 1.00% PIK/Q)   4/10/2023           3.9  
        First lien senior secured loan   10.25% (Libor + 6.75% Cash, 1.00% PIK/Q)   4/10/2023           9.2  
        First lien senior secured loan   10.25% (Libor + 6.75% Cash, 1.00% PIK/Q)   4/10/2023           18.3  
                             
Jim N Nicks Management, LLC   Restaurant owner and   First lien senior secured   7.85% (Libor + 5.25%/Q)   7/10/2023           2.7 (109)
3755 Corporate Woods Drive   operator   revolving loan                      
Birmingham, AL 35242       First lien senior secured loan       7/10/2023           (110)
        First lien senior secured loan   7.85% (Libor + 5.25%/Q)   7/10/2023           1.1  
        First lien senior secured loan   7.85% (Libor + 5.25%/Q)   7/10/2023           13.5  
                             
Joule Unlimited Technologies, Inc. and   Renewable fuel and chemical   First lien senior secured loan       10/1/2018            
Stichting Joule Global Foundation   production developer   First lien senior secured loan       10/1/2018            
18 Crosby Drive       Warrant       7/25/2023     0.99 %   (2)(5)
Bedford, MA 01730                              
                             

130


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Joyce Lane Capital LLC and   Specialty finance company   First lien senior secured loan       12/27/2022           (111)
Joyce Lane Financing SPV LLC       First lien senior secured loan   6.60% (Libor + 4.00%/Q)   12/27/2022           0.8  
(fka Ciena Capital LLC)(4)(5)       Equity interests             100.00 %   2.9  
1633 Broadway                              
39th Floor                              
New York, NY 10019                              
                             
JWC/KI Holdings, LLC   Foodservice sales and   Membership units             5.13 %   7.1  
1701 Crossroads Drive   marketing agency                          
Odenton, MD 21113                              
                             
Kaufman, Hall & Associates, LLC   Provider of specialty advisory   First lien senior secured   7.49% (Libor + 5.00%/M)   11/9/2023           0.5 (112)
5202 Old Orchard Rd   services and software   revolving loan                      
700 Skokie, IL 60077   solutions to the   First lien senior secured loan   7.74% (Libor + 5.25%/M)   5/9/2025           5.4  
    healthcare market   First lien senior secured loan   7.74% (Libor + 5.25%/M)   5/9/2025           8.1  
        First lien senior secured loan   7.93% (Libor + 5.25%/S)   5/9/2025           4.5  
        First lien senior secured loan   7.93% (Libor + 5.25%/S)   5/9/2025           6.7  
                             
KBHS Acquisition, LLC   Provider of behavioral health   First lien senior secured   7.48% (Libor + 5.00%/M)   3/17/2022           0.9 (113)
(d/b/a Alita Care, LLC)   services   revolving loan                      
160 Chubb Avenue       First lien senior secured   7.49% (Libor + 5.00%/M)   3/17/2022           0.9 (113)
Suite 206       revolving loan                      
Lyndhurst, NJ 07071       First lien senior secured   7.48% (Libor + 5.00%/M)   3/17/2022           0.2 (113)
        revolving loan                      
        First lien senior secured   7.49% (Libor + 5.00%/M)   3/17/2022           0.5 (113)
        revolving loan                      
        First lien senior secured revolving loan   7.50% (Libor + 5.00%/M)   3/17/2022           2.0 (113)
        First lien senior secured revolving loan   9.50% (Base Rate + 4.00%/Q)   3/17/2022           0.2 (113)
                             
KC Culinarte Intermediate, LLC   Manufacturer of fresh   Second lien senior secured   10.25% (Libor + 7.75%/M)   8/24/2026           35.3  
330 Lynnway   refrigerated and frozen   loan                      
Lynn, MA 01901   food products                          
                             
Key Surgical LLC   Provider of sterile processing,   First lien senior secured       6/1/2022           (114)
8101 Wallas Road   operating room and   revolving loan                      
Minneapolis, MN 55344   instrument care supplies   First lien senior secured loan   5.75% (EURIBOR + 4.75%/Q)   6/1/2023           16.6  
    for hospitals                          
                             
KHC Holdings, Inc. and Kele Holdco, Inc.   Catalog-based distribution   First lien senior secured   6.75% (Libor + 4.25%/M)   10/30/2020           0.4 (115)
3300 Brother Blvd   services provider for building   revolving loan                      
Bartlett, TN 38133   automation systems   First lien senior secured loan   8.60% (Libor + 6.00%/Q)   10/30/2022           65.9  
        Common stock             2.71 %   3.8  
                             
KPS Global LLC and Cool Group LLC   Walk-in cooler and   First lien senior secured loan   5.11% (Libor + 2.63%/M)   4/5/2022           1.6  
4201 N Beach Street   freezer systems   First lien senior secured loan   9.67% (Libor + 7.19%/M)   4/5/2022           4.3  
Fort Worth, TX 76137       First lien senior secured loan   9.62% (Libor + 7.14%/M)   4/5/2022           10.5  
        First lien senior secured loan   9.62% (Libor + 7.14%/M)   4/5/2022           5.2  
        Class A units             1.60 %   1.5  
                             
Labstat International Inc.(5)   Lab testing services for   First lien senior secured       6/25/2024           (116)
262 Manitou Drive   nicotine containing   revolving loan                      
Kitchener, ON N2C 1L3   products   First lien senior secured loan   8.27% (CIBOR + 6.25%/Q)   6/25/2024           5.1  
        First lien senior secured loan   8.27% (CIBOR + 6.25%/Q)   6/25/2024           19.6  
                             
LBP Intermediate Holdings LLC   Manufacturer of paper and   First lien senior secured       7/10/2020           (117)
1325 S Cicero Ave   corrugated foodservice   revolving loan                      
Cicero, IL 60804   packaging   First lien senior secured loan   8.10% (Libor + 5.50%/Q)   7/10/2020           11.4  
        First lien senior secured loan   8.10% (Libor + 5.50%/Q)   7/10/2020           11.8  
        First lien senior secured loan   8.10% (Libor + 5.50%/Q)   7/10/2020           4.9  
                             
Liaison Acquisition, LLC   Provider of centralized   First lien senior secured       2/8/2022           (118)
311 Arsenal Street   applications services to   revolving loan                      
Watertown, MA 02472   educational associations   Second lien senior secured loan   11.74% (Libor + 9.25%/M)   8/8/2023           3.3  
                             
LLSC Holdings Corporation   Marketing services provider   Series A preferred stock             100.00 %   0.4  
(dba Lawrence Merchandising Services)(4)       Common stock             100.00 %    
3500 Holly Lane                              
North Suite 10                              
Plymouth, MN 55447                              
                             
Lone Wolf Real Estate Technologies Inc.(5)   Provider of accounting and   First lien senior secured       7/5/2021           (119)
231 Shearson Crescent   front-office solutions for real   revolving loan                      
Suite 310   estate brokers and agents                          
Cambridge, ON N1T 1J5                              
Canada                              
                             
LS DE LLC and LM LSQ Investors LLC(5)   Asset based lender   Senior subordinated loan   10.50%   6/25/2021           3.0  
2600 Lucien Way       Senior subordinated loan   10.50%   3/13/2024           37.0  
Suite 100       Membership units             2.12 %   5.0  
Maitland, FL 32751                              

131


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
LTG Acquisition, Inc.   Designer and manufacturer   Class A membership units             5.08 %   4.0  
900 Klein Road   of display, lighting and                          
Plano, TX 75074   passenger communication systems for mass transportation markets                          
                             
Mac Lean-Fogg Company and MacLean-Fogg   Manufacturer and supplier   First lien senior secured   7.00% (Base Rate + 1.50%/Q)   12/21/2023           (120)
Holdings, L.L.C.   for the power utility and   revolving loan                      
1000 Allanson Road   automotive markets   First lien senior secured loan       12/22/2025           (121)
Mundelein, IL 60060   worldwide   First lien senior secured loan   7.24% (Libor + 4.75%/M)   12/22/2025           12.5  
        First lien senior secured loan   7.25% (Libor + 4.75%/M)   12/22/2025           165.0  
        First lien senior secured loan   7.25% (Libor + 4.75%/M)   12/22/2025           12.4  
        Preferred units   4.50% Cash, 9.25% PIK         93.58 %   81.0  
                             
Magento, Inc.   eCommerce platform   First lien senior secured       11/2/2020           (122)
54 N. Central Ave.   provider for the retail   revolving loan                      
Suite 200   industry                          
Campbell, CA 95008                              
                             
Masergy Holdings, Inc.   Provider of software-defined   First lien senior secured       12/15/2021           (123)
2740 North Dallas Parkway   solutions for enterprise global   revolving loan                      
Plano, TX 75093   networks, cyber security, and cloud communications                          
                             
Massage Envy, LLC and ME Equity LLC   Franchisor in the massage   First lien senior secured       9/26/2020           (124)
14350 N 87th Street   industry   revolving loan                      
Suite 200, 205 and 230       First lien senior secured loan       7/19/2020           (125)
Scottdale, AZ 85260       First lien senior secured loan   9.24% (Libor + 6.75%/M)   12/31/2024           0.5  
        First lien senior secured loan   9.24% (Libor + 6.75%/M)   12/31/2024           1.0  
        First lien senior secured loan   9.24% (Libor + 6.75%/M)   12/31/2024           0.3  
        First lien senior secured loan   9.25% (Libor + 6.75%/M)   12/31/2024           1.7  
        First lien senior secured loan   9.31% (Libor + 6.75%/Q)   12/31/2024           0.4  
        First lien senior secured loan   9.31% (Libor + 6.75%/Q)   12/31/2024           1.5  
        First lien senior secured loan   9.55% (Libor + 6.75%/Q)   7/19/2020           2.4  
        First lien senior secured loan   9.25% (Libor + 6.75%/M)   7/19/2020           0.4  
        First lien senior secured loan   9.23% (Libor + 6.75%/M)   7/19/2020           0.9  
        First lien senior secured loan   9.31% (Libor + 6.75%/Q)   7/19/2020           0.2  
        First lien senior secured loan   9.24% (Libor + 6.75%/M)   9/28/2020           0.6  
        First lien senior secured loan   9.24% (Libor + 6.75%/M)   9/28/2020           0.5  
        First lien senior secured loan   9.31% (Libor + 6.75%/Q)   9/26/2020           0.3  
        First lien senior secured loan   9.24% (Libor + 6.75%/M)   9/28/2020           0.3  
        First lien senior secured loan   9.31% (Libor + 6.75%/Q)   9/28/2020           0.1  
        First lien senior secured loan   9.23% (Libor + 6.75%/M)   9/28/2020           1.0  
        First lien senior secured loan   9.31% (Base Rate + 5.50%/Q)   9/26/2020           38.0  
        First lien senior secured loan   9.31% (Base Rate + 5.50%/Q)   9/26/2020           18.5  
        Common stock             1.62 %   6.3  
                             
Mavis Tire Express Services Corp.   Auto parts retailer   Second lien senior secured loan       3/20/2026           (126)
and Mavis Tire Express Services TopCo, L.P.       Second lien senior secured loan   9.98% (Libor + 7.50%/M)   3/20/2026           0.7  
385 Saw Mill River Road       Second lien senior secured loan   9.98% (Libor + 7.50%/M)   3/20/2026           0.3  
Suite 17       Second lien senior secured loan   9.98% (Libor + 7.50%/M)   3/20/2026           0.3  
Millwood, NY 10546       Second lien senior secured loan   9.98% (Libor + 7.50%/M)   3/20/2026           152.4  
        Class A units             0.91 %   13.0  
                             
MB Aerospace Holdings II Corp.
39 Bradley Park Road
East Granby, CT 06026
  Aerospace engine components manufacturer   Second lien senior secured loan   11.10% (Libor + 8.50%/Q)   1/22/2026           67.7  
                             
MB2 Dental Solutions, LLC   Dental services provider   First lien senior secured   9.25% (Base Rate + 3.75%/Q)   9/29/2023           1.9 (127)
2403 Lacy Lane       revolving loan                      
Carrollton, TX 75006       First lien senior secured loan   7.35% (Libor + 4.75%/Q)   9/29/2023           7.0  
                             
MCH Holdings, Inc. and MC Acquisition   Healthcare professional   First lien senior secured loan   7.98% (Libor + 5.50%/M)   1/17/2020           19.5  
Holdings I, LLC   provider   First lien senior secured loan   8.00% (Libor + 5.50%/M)   1/17/2020           19.4  
825 East Gate Blvd.       First lien senior secured loan   7.98% (Libor + 5.50%/M)   1/17/2020           39.6  
Garden City, NY 11530       First lien senior secured loan   8.00% (Libor + 5.50%/M)   1/17/2020           39.4  
        First lien senior secured loan   7.98% (Libor + 5.50%/M)   1/17/2020           15.2  
        First lien senior secured loan   8.00% (Libor + 5.50%/M)   1/17/2020           15.1  
        Class A units             0.56 %   1.1  
                             
Mckenzie Sports Products, LLC   Designer, manufacturer and   First lien senior secured   6.25% (Libor + 3.75%/M)   9/18/2020           0.9 (128)
1910 Saint Luke's Church Road   distributor of hunting-related   revolving loan                      
Salisbury, NC 28146   supplies   First lien senior secured   10.25% (Base Rate + 4.75%/Q)   9/18/2020           0.5 (128)
        revolving loan                      
        First lien senior secured loan   8.25% (Libor + 5.75%/M)   9/18/2020           1.5  
        First lien senior secured loan   8.25% (Libor + 5.75%/M)   9/18/2020           4.0  
        First lien senior secured loan   8.25% (Libor + 5.75%/M)   9/18/2020           84.5  
                             

132


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Microstar Logistics LLC, Microstar Global   Keg management solutions   Second lien senior secured loan   10.00% (Libor + 7.50%/M)   8/2/2021           42.5  
Asset Management LLC,   provider   Second lien senior secured loan   10.00% (Libor + 7.50%/M)   8/2/2021           75.0  
and MStar Holding Corporation       Second lien senior secured loan   10.00% (Libor + 7.50%/M)   8/2/2021           10.0  
5299 DTC Blvd       Common stock             3.47 %   8.2  
Suite 510
Greenwood Village, CO 80111
                             
                             
Ministry Brands, LLC and MB Parent   Software and payment   First lien senior secured       12/2/2022           (129)
HoldCo, L.P.   services provider to faith-   revolving loan                      
(dba Community Brands)   based institutions   First lien senior secured loan   6.50% (Libor + 4.00%/M)   12/2/2022           4.9  
14488 Old Stage Rd       First lien senior secured loan   6.50% (Libor + 4.00%/M)   12/2/2022           10.5  
Lenoir City, TN 37772       First lien senior secured loan   6.50% (Libor + 4.00%/M)   12/2/2022           14.5  
        Second lien senior secured loan       6/2/2023           (130)
        Second lien senior secured loan   11.88% (Libor + 9.25%/Q)   6/2/2023           16.6  
        Second lien senior secured loan   11.88% (Libor + 9.25%/Q)   6/2/2023           2.5  
        Second lien senior secured loan   11.88% (Libor + 9.25%/Q)   6/2/2023           15.4  
        Second lien senior secured loan   11.88% (Libor + 9.25%/Q)   6/2/2023           4.7  
        Second lien senior secured loan   10.50% (Libor + 8.00%/M)   6/2/2023           0.2  
        Second lien senior secured loan   10.50% (Libor + 8.00%/M)   6/2/2023           2.2  
        Second lien senior secured loan   10.63% (Libor + 8.00%/Q)   6/2/2023           7.0  
        Second lien senior secured loan   10.63% (Libor + 8.00%/Q)   6/2/2023           0.8  
        Second lien senior secured loan   11.88% (Libor + 9.25%/Q)   6/2/2023           9.2  
        Second lien senior secured loan   10.63% (Libor + 8.00%/Q)   6/2/2023           38.6  
        Second lien senior secured loan   11.88% (Libor + 9.25%/Q)   6/2/2023           75.0  
        Second lien senior secured loan   11.88% (Libor + 9.25%/Q)   6/2/2023           15.0  
        Class A units             0.55 %   6.4  
                             
Movati Athletic (Group) Inc.(5)   Premier health club operator   First lien senior secured loan       10/5/2022           (131)
33 University Avenue       First lien senior secured loan   6.81% (CIBOR + 4.50%/Q)   10/5/2022           0.6  
Windsor, ON N9A 5N8
Canada
      First lien senior secured loan   6.81% (CIBOR + 4.50%/Q)   10/5/2022           2.8  
                             
Moxie Patriot LLC
4100 Spring Valley Road
Suite 1001
Dallas, TX 75244
  Gas turbine power generation facilities operator   First lien senior secured loan   8.55% (Libor + 5.75%/Q)   12/19/2020           31.5  
                             
MPH Energy Holdings, LP
225 S. Main Street
Rutland, VT 05701
  Operator of municipal recycling facilities   Limited partnership interest             3.13 %    
                             
MSHC, Inc.   Heating, ventilation and air   First lien senior secured   6.74% (Libor + 4.25%/M)   7/29/2022           1.1 (132)
214 N Tryon Street   conditioning services provider   revolving loan                      
Suite 2425       First lien senior secured   8.75% (Base Rate + 3.25%/Q)   7/29/2022           0.6 (132)
Charlotte, NC 28202       revolving loan                      
        First lien senior secured loan       7/31/2023           (133)
        First lien senior secured loan   7.03% (Libor + 4.25%/Q)   7/31/2023           0.3  
        First lien senior secured loan   6.85% (Libor + 4.25%/Q)   7/31/2023           0.2  
        First lien senior secured loan   6.85% (Libor + 4.25%/Q)   7/31/2023           0.9  
        Second lien senior secured loan       12/31/2025           (134)
        Second lien senior secured loan       12/31/2025           (135)
        Second lien senior secured loan   10.85% (Libor + 8.25%/Q)   12/31/2025           2.8  
        Second lien senior secured loan   11.03% (Libor + 8.25%/Q)   12/31/2025           5.9  
        Second lien senior secured loan   10.99% (Libor + 8.25%/Q)   12/31/2025           7.9  
        Second lien senior secured loan   10.88% (Libor + 8.25%/Q)   12/31/2025           9.8  
        Second lien senior secured loan   10.85% (Libor + 8.25%/Q)   12/31/2025           2.7  
        Second lien senior secured loan   10.85% (Libor + 8.25%/Q)   12/31/2025           4.8  
        Second lien senior secured loan   10.85% (Libor + 8.25%/Q)   12/31/2025           46.0  
                             
Murchison Oil and Gas, LLC and   Exploration and production   First lien senior secured loan       10/26/2023           (136)
Murchison Holdings, LLC   company   First lien senior secured loan   10.60% (Libor + 8.00%/Q)   10/26/2023           5.0  
7250 Legacy Tower One, Dallas Parkway       First lien senior secured loan   10.60% (Libor + 8.00%/Q)   10/26/2023           5.0  
Suite 1400       First lien senior secured loan   10.60% (Libor + 8.00%/Q)   10/26/2023           5.0  
Plano, TX 75024       First lien senior secured loan   10.60% (Libor + 8.00%/Q)   10/26/2023           21.5  
        Preferred units   8.00% PIK         33.33 %   22.1  
                             
MVL Group, Inc.(4)
1061 E. Indiantown Road
Suite 300
Jupiter, FL 33477
  Marketing research provider   Common stock             56.10 %    
                             
MW Dental Holding Corp.   Dental services provider   First lien senior secured   9.35% (Libor + 6.75%/Q)   4/12/2021           6.0 (137)
680 Hehli Way       revolving loan                      
PO Box 69       First lien senior secured loan       4/12/2021           (138)
Mondovi, WI 54755       First lien senior secured loan   9.35% (Libor + 6.75%/Q)   4/12/2021           18.7  
        First lien senior secured loan   9.35% (Libor + 6.75%/Q)   4/12/2021           104.3  
        First lien senior secured loan   9.35% (Libor + 6.75%/Q)   4/12/2021           19.1  
                             
My Health Direct, Inc.
4322 Harding Pike
Nashville, TN 37205
  Healthcare scheduling exchange software solution provider   Warrant       9/18/2024     4.85 %   (2)
                             

133


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
NAS, LLC, Nationwide Marketing   Buying and marketing   Second lien senior secured loan   11.35% (Libor + 8.75%/Q)   12/1/2021           24.1  
Group, LLC and Nationwide Administrative   services organization for   Second lien senior secured loan   11.35% (Libor + 8.75%/Q)   12/1/2021           7.0  
Services, Inc.
110 Oakwood Drive
Suite 200
Winston-Salem, NC 27103
  appliance, furniture and consumer electronics dealers                          
                             
National Intergovernmental Purchasing Alliance Company
840 Crescent Centre Dr #600
Franklin, TN 37067
  Leading group purchasing organization ("GPO") for public agencies and educational institutions in the U.S   First lien senior secured revolving loan       5/23/2023           (139)
                             
Navisun LLC and Navisun Holdings LLC(4)   Owner and operater of   First lien senior secured loan       11/15/2023           (140)
39 Grace Street   commercial and industrial   First lien senior secured loan       11/15/2023           (141)
New Canaan, CT 06840   solar projects   First lien senior secured loan   8.00% PIK   11/15/2023           43.9  
        Series A preferred units   10.50% PIK         100.00 %   5.0  
        Class A units             55.00 %   0.2  
                             
NECCO Holdings, Inc. and New England Confectionery Company, Inc.(4)   Producer and supplier of candy   First lien senior secured revolving loan       1/31/2018           2.9 (142)
135 American Legion       First lien senior secured loan       8/31/2018           (143)
Revere, MA 02151       First lien senior secured loan       8/31/2018            
        First lien senior secured loan       1/31/2018           1.6  
        First lien senior secured loan       11/9/2018           0.1  
        Common stock             100.00 %    
                             
NECCO Realty Investments LLC(4)
135 American Legion Highway
Revere, MA 02151
  Real estate holding company   Membership units             100.00 %    
                             
New Trident Holdcorp, Inc. and Trident   Outsourced mobile diagnostic   Second lien senior secured loan       7/31/2022            
Holding Company, LLC   healthcare service provider   Second lien senior secured loan       7/31/2020            
505 Hamilton Ave
Suite 200
Palo Alto, CA 94301
      Senior subordinated loan       7/31/2020            
                             
NM GRC HOLDCO, LLC   Regulatory compliance   First lien senior secured loan       2/9/2024           (144)
1370 Broadway   services provider to financial   First lien senior secured loan   8.60% (Libor + 6.00%/Q)   2/9/2024           19.2  
12th Floor
New York, NY 10018
  institutions   First lien senior secured loan   8.60% (Libor + 6.00%/Q)   2/9/2024           41.0  
                             
NMC Skincare Intermediate Holdings II, LLC   Developer, manufacturer and marketer of skincare products   First lien senior secured revolving loan   7.25% (Libor + 4.75%/M)   10/31/2024           1.6 (145)
5200 New Horizons Blvd       First lien senior secured loan       10/31/2024           (146)
Amityville, NY 11701       First lien senior secured loan   7.25% (Libor + 4.75%/M)   10/31/2024           1.7  
        First lien senior secured loan   7.25% (Libor + 4.75%/M)   10/31/2024           24.6  
                             
NMN Holdings III Corp. and NMN   Provider of complex rehab   First lien senior secured       11/13/2023           (147)
Holdings LP   technology solutions for   revolving loan                      
155 Franklin Road
Brentwood, TN 37027
  patients with mobility loss   Partnership units             0.76 %   3.1  
                             
NMSC Holdings, Inc. and ASP NAPA   Anesthesia management   Second lien senior secured loan   12.50% (Libor + 10.00%/M)   10/19/2023           72.8  
Holdings, LLC
68 South Service Road
Suite 350
Melville, NY 11747
  services provider   Class A units             0.68 %   1.3  
                             
Nodality, Inc.   Biotechnology company   First lien senior secured loan       8/12/2016            
170 Harbor Way       First lien senior secured loan       8/12/2016            
Suite 200       First lien senior secured loan       8/25/2016            
San Francisco, CA 94080       First lien senior secured loan       8/25/2016            
        Warrant       3/15/2026     51.00 %   (2)
                             
Nordco Inc.
245 West Forest Hill Avenue
Oak Creek, WI 53154
  Manufacturer of railroad maintenance-of-way machinery   First lien senior secured revolving loan   11.00% (Base Rate + 5.50%/Q)   8/26/2020           2.5 (148)
                             
Novetta Solutions, LLC   Provider of advanced   First lien senior secured loan   7.50% (Libor + 5.00%/M)   10/17/2022           8.3  
7921 Jones Branch Drive
5th Floor
McLean, VA 22102
  analytics solutions for the government, defense and commercial industries   Second lien senior secured loan   11.00% (Libor + 8.50%/M)   10/16/2023           28.5  
                             
NSM Insurance Group, LLC
555 North Lane
Suite 6060
Conshohocken, PA 19428
  Insurance program administrator   First lien senior secured loan   7.10% (Libor + 4.50%/Q)   5/11/2024           13.1  
                             
NSM Sub Holdings Corp.
320 Premier Court
Suite 220
Franklin, TN 37067
  Provider of customized mobility, rehab and adaptive seating systems   First lien senior secured revolving loan       10/3/2022           (149)
                             

134


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
nThrive, Inc. (fka Precyse Acquisition Corp.)
100 North Point Center East
Suite 200
Alpharetta, GA 30022
  Provider of healthcare information management technology and services   Second lien senior secured loan   12.25% (Libor + 9.75%/M)   4/20/2023           9.8  
                             
NueHealth Performance, LLC   Developer, builder and   First lien senior secured       9/27/2023           (150)
11221 Roe Ave   manager of specialty surgical   revolving loan                      
Suite 300   hospitals and ambulatory   First lien senior secured loan       9/27/2023           (151)
Leawood, KS 66211   surgery centers   First lien senior secured loan   9.00% (Libor + 6.50%/M)   9/27/2023           1.5  
        First lien senior secured loan   9.00% (Libor + 6.50%/M)   9/27/2023           9.9  
                             
OHA Credit Partners XI(5)
190 Elgin Avenue
George Town, Grand Cayman KY1-9005
Cayman Islands
  Investment vehicle   Subordinated notes   13.90%   1/20/2032           13.8  
                             
OmniSYS Acquisition Corporation, OmniSYS, LLC, and OSYS Holdings, LLC
15950 Dallas Parkway
Suite 350
Dallas, TX 75248
  Provider of technology-enabled solutions to pharmacies   Limited liability company membership interest             1.57 %   0.8  
                             
Orion Foods, LLC(4)   Convenience food service   First lien senior secured loan       9/1/2015           0.4  
2930 W. Maple Street   retailer   Second lien senior secured loan       9/1/2015            
Sioux Falls, SD 57118       Preferred units             93.53 %    
        Class A common units             100.00 %    
        Class B common units             25.00 %    
                             
OTG Management, LLC
352 Park Avenue South
  Airport restaurant operator   First lien senior secured revolving loan   9.64% (Libor + 7.00%/Q)   8/26/2021           1.6 (152)
New York, NY 10010       First lien senior secured revolving loan   9.60% (Libor + 7.00%/Q)   8/26/2021           8.4 (152)
        First lien senior secured loan       8/26/2021           (153)
        First lien senior secured loan   9.69% (Libor + 7.00%/Q)   8/26/2021           2.5  
        First lien senior secured loan   9.69% (Libor + 7.00%/Q)   8/26/2021           1.6  
        First lien senior secured loan   9.74% (Libor + 7.00%/Q)   8/26/2021           2.2  
        First lien senior secured loan   9.69% (Libor + 7.00%/Q)   8/26/2021           2.2  
        First lien senior secured loan   9.60% (Libor + 7.00%/Q)   8/26/2021           3.6  
        First lien senior secured loan   9.60% (Libor + 7.00%/Q)   8/26/2021           2.6  
        First lien senior secured loan   9.74% (Libor + 7.00%/Q)   8/26/2021           4.9  
        First lien senior secured loan   9.69% (Libor + 7.00%/Q)   8/26/2021           0.6  
        First lien senior secured loan   9.60% (Libor + 7.00%/Q)   8/26/2021           0.7  
        First lien senior secured loan   9.61% (Libor + 7.00%/Q)   8/26/2021           1.8  
        First lien senior secured loan   9.60% (Libor + 7.00%/Q)   8/26/2021           1.0  
        First lien senior secured loan   9.80% (Libor + 7.00%/Q)   8/26/2021           0.3  
        First lien senior secured loan   9.69% (Libor + 7.00%/Q)   8/26/2021           0.7  
        First lien senior secured loan   9.60% (Libor + 7.00%/Q)   8/26/2021           1.9  
        First lien senior secured loan   9.61% (Libor + 7.00%/Q)   8/26/2021           0.7  
        First lien senior secured loan   9.74% (Libor + 7.00%/Q)   8/26/2021           48.9  
        First lien senior secured loan   9.80% (Libor + 7.00%/Q)   8/26/2021           48.9  
        Senior subordinated loan   13.00% PIK   2/26/2022           30.7  
        Class A preferred units   14.50% PIK         20.00 %   40.8  
        Common units             3.79 %   8.7  
        Warrant       6/19/2018     8.33 %   19.2 (2)
                             
Panda Liberty LLC (fka Moxie   Gas turbine power generation   First lien senior secured loan   9.10% (Libor + 6.50%/Q)   8/21/2020           42.8  
Liberty LLC)
4100 Spring Valley Road
Suite 1001
Dallas, TX 75244
  facilities operator   First lien senior secured loan   9.30% (Libor + 6.50%/Q)   8/21/2020           29.3  
                             
Panda Temple Power, LLC and T1 Power   Gas turbine power generation   Second lien senior secured loan   10.48% PIK (Libor + 8.00%/Q)   2/7/2023           9.2  
Holdings LLC(3)
2892 Panda Drive
Temple, TX 76501
  facilities operator   Class A Common units             6.16 %   12.3  
                             
Paper Source, Inc. and Pine Holdings, Inc.
410 N Milwaukee
  Retailer of fine and artisanal paper products   First lien senior secured revolving loan   10.50% (Base Rate + 5.00%/M)   9/23/2019           0.7 (154)
Chicago, IL 60654       First lien senior secured loan   8.85% (Libor + 6.25%/Q)   9/23/2019           9.2  
        Class A common stock             3.64 %   3.0  
                             
Park Place Technologies, LLC
5910 Landerbrook Drive
Mayfield Heights, OH 44124
  Provides hardware maintenance and support services for IT data centers   First lien senior secured revolving loan       3/29/2023           (155)
                             
Partnership Capital Growth Fund I, L.P.(3)(5)
1 Embarcadero Center
Suite 3810
San Francisco, CA 94111
  Investment partnership   Limited partnership interest             25.00 %    
                             

135


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Partnership Capital Growth Investors III, L.P.(5)
1 Embarcadero Center
Suite 3810
San Francisco, CA 94111
  Investment partnership   Limited partnership interest             2.50 %   4.2  
                             
Pathway Vet Alliance LLC and Pathway Vet   Operator of freestanding   First lien senior secured       12/21/2023           (156)
Alliance Holding LLC   veterinary hospitals   revolving loan                      
3930 Bee Cave Road       First lien senior secured loan       12/20/2024           (157)
Suite 9       First lien senior secured loan   7.00% (Libor + 4.50%/M)   12/20/2024           2.1  
Austin, TX 78746       First lien senior secured loan   7.00% (Libor + 4.50%/M)   12/20/2024           68.8  
        Second lien senior secured loan       12/19/2025           (158)
        Second lien senior secured loan   11.00% (Libor + 8.50%/M)   12/19/2025           162.3  
        Preferred subscription units             0.84 %   4.4  
                             
Patterson Medical Supply, Inc.
28100 Torch Parkway
Suite 700
Warrenville, IL 60555
  Distributor of rehabilitation supplies and equipment   Second lien senior secured loan   11.24% (Libor + 8.50%/Q)   8/28/2023           67.9  
                             
PayNearMe, Inc.
292 Gibralter Drive
Suite 104
Sunnyvale, IL 60555
  Electronic cash payment system provider   Warrant       3/11/2023     1.11 %   (2)
                             
PCG-Ares Sidecar Investment II, L.P.(3)(5)   Investment partnership   Limited partnership interest             100.00 %   16.8  
1 Embarcadero Center
Suite 3810
San Francisco, CA 94111
                             
                             
PCG-Ares Sidecar Investment, L.P.(3)(5)   Investment partnership   Limited partnership interest             100.00 %   4.4  
1 Embarcadero Center
Suite 3810
San Francisco, CA 94111
                             
                             
PDI TA Holdings, Inc., Peachtree   Provider of enterprise   First lien senior secured       10/24/2024           (159)
Parent, Inc. and Insight PDI Holdings, LLC   management software for the   revolving loan                      
4001 Central Pointe Parkway   convenience retail and   First lien senior secured loan       10/24/2024           (160)
Temple, TX 76504   petroleum wholesale market   First lien senior secured loan       10/24/2024           (161)
        First lien senior secured loan   7.13% (Libor + 3.50%/Q)   10/24/2024           54.9  
        Second lien senior secured loan       10/24/2025           (162)
        Second lien senior secured loan       10/24/2025           (163)
        Second lien senior secured loan   11.28% (Libor + 8.50%/Q)   10/24/2025            
        Second lien senior secured loan   11.13% (Libor + 8.50%/Q)   10/24/2025           70.0  
        Series A preferred shares   13.25% PIK         8.00 %   13.7  
        Class A units             0.50 %   1.9  
                             
Pegasus Intermediate Holdings, LLC
1101 Haynes Street
#218
Raleigh, NC 27604
  Plant maintenance and scheduling process software provider   First lien senior secured revolving loan       11/7/2022           (164)
                             
Pelican Products, Inc.
23215 Early Avenue
Torrance, CA 90505
  Manufacturer of flashlights   Second lien senior secured loan   10.23% (Libor + 7.75%/M)   5/1/2026           27.3  
                             
Penn Virginia Holding Corp.(5)
14701 St. Mary's Lane
Suite 275
Houston, TX 77079
  Oil and gas exploration and production company   Second lien senior secured loan   9.50% (Libor + 7.00%/M)   9/29/2022           90.1  
                             
PERC Holdings 1 LLC
2215 So. York Road
Suite 202
Oak Brook, IL 60523
  Operator of recycled energy, combined heat and power, and energy efficiency facilities   Class B common units             18.94 %   21.8  
                             
Perforce Software, Inc.   Developer of software used   First lien senior secured       12/28/2022           (165)
400 North 1st Avenue   for application development   revolving loan                      
Suite 200
Minneapolis, MN 55401
      First lien senior secured loan   9.00% (Base Rate + 3.50%/M)   12/27/2024           47.6  
                             
PetIQ, LLC
500 East Shore Drive
Suite 120
Eagle, ID 83616
  Distributor and manufacturer of pet prescription medications and health products   First lien senior secured loan   7.74% (Libor + 5.25%/M)   1/17/2023           17.8  
                             
Petroflow Energy Corporation and TexOak   Oil and gas exploration and   First lien senior secured loan       6/29/2019            
Petro Holdings LLC(3)   production company   Second lien senior secured loan       12/30/2019            
525 S. Main       Second lien senior secured loan       12/30/2019            
Suite 1120
Tulsa, OK 74103
      Common units             20.20 %    
                             

136


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
PHL Investors, Inc., and PHL Holding Co.(4)
50 Weston Street
Hartford, CT 06120
  Mortgage services   Class A common stock             100.00 %    
                             
PHNTM Holdings, Inc. and Planview   Provider of project and   Second lien senior secured loan   12.25% (Libor + 9.75%/M)   7/27/2023           62.0  
Parent, Inc.   portfolio management   Class A common shares             0.19 %   1.8  
12301 Research Blvd, Research Park Plaza V
Suite 101
Austin, TX 78759
  software   Class B common shares             0.19 %   0.3  
                             
Phylogeny, LLC and Conversant   Provider of biospecimen   First lien senior secured       3/29/2024           (166)
Biologics, LLC (fka WSHP FC   products for pharma research   revolving loan                      
Acquisition LLC)       First lien senior secured loan       3/29/2024           (167)
1476 Manning Parkway       First lien senior secured loan   9.10% (Libor + 6.50%/Q)   3/29/2024           6.0  
Powell, OH 43065       First lien senior secured loan   9.10% (Libor + 6.50%/M)   3/29/2024           4.7  
        First lien senior secured loan   9.10% (Libor + 6.50%/Q)   3/29/2024           28.4  
                             
PhyMED Management LLC
110 29th Avenue North
Suite 301
Nashville, TN 37203
  Provider of anesthesia services   Second lien senior secured loan   11.38% (Libor + 8.75%/Q)   5/18/2021           47.2  
                             
PIH Corporation and Primrose Holding   Franchisor of education-based   First lien senior secured   8.00% (Libor + 5.50%/M)   12/15/2020           1.0 (168)
Corporation(3)   early childhood centers   revolving loan                      
3660 Cedarcrest Road
Acworth, GA 30101
      Common stock             8.46 %   22.7  
                             
Piper Jaffray Merchant Banking Fund I, L.P.(5)
800 Nicollet Mall
Suite 800
Minneapolis, MN 55402
  Investment partnership   Limited partnership interest             2.00 %   1.5  
                             
Plantation Products, LLC, Seed   Provider of branded lawn and   Second lien senior secured loan   10.08% (Libor + 7.34%/Q)   6/23/2021           56.0  
Holdings, Inc. and Flora Parent, Inc.   garden products   Second lien senior secured loan   10.08% (Libor + 7.34%/Q)   6/23/2021           10.0  
202 South Washington Street
Norton, MA 02766
      Common stock             2.56 %   6.3  
                             
Plaskolite PPC Intermediate II LLC and   Manufacturer of specialized   First lien senior secured loan   6.73% (Libor + 4.25%/M)   12/15/2025           24.4  
Plaskolite PPC Blocker LLC   acrylic and polycarbonate   Second lien senior secured loan   10.24% (Libor + 7.75%/M)   12/14/2026           54.6  
400 W Nationwide Blvd
Suite 400
Columbus, OH 43215
  sheets   Co-Invest units             0.09 %   0.6  
                             
Poplicus Incorporated
1061 Market Street
Floor 6
San Francisco, CA 94103
  Business intelligence and market analytics platform for companies that sell to the public sector   Warrant       6/25/2025     3.23 %   (2)
                             
Practice Insight, LLC   Revenue cycle management   First lien senior secured       8/23/2022           (169)
1 Greenway Plaza   provider to the emergency   revolving loan                      
Suite 350
Houston, TX 77046
  healthcare industry   First lien senior secured loan   7.50% (Libor + 5.00%/M)   8/23/2022           12.4  
                             
Premise Health Holding Corp. and OMERS   Provider of employer-   First lien senior secured   6.09% (Libor + 3.50%/Q)   7/10/2023           3.0 (170)
Bluejay Investment Holdings LP   sponsored onsite health and   revolving loan                      
5500 Maryland Way   wellness clinics and   First lien senior secured loan       7/10/2025           (171)
400 Brentwood, TN 37027   pharmacies   First lien senior secured loan   6.35% (Libor + 3.75%/Q)   7/10/2025           0.8  
        First lien senior secured loan   6.35% (Libor + 3.75%/Q)   7/10/2025           10.8  
        Second lien senior secured loan   10.10% (Libor + 7.50%/Q)   7/10/2026           66.4  
        Class A units             1.53 %   10.4  
                             
Production Resource Group, L.L.C.   Provider of rental equipment,   First lien senior secured loan   9.65% (Libor + 7.00%/Q)   8/21/2024           20.2  
200 Business Parl Dr.   labor, production   First lien senior secured loan   9.65% (Libor + 7.00%/Q)   8/21/2024           76.8  
Suite 109
Armonk, NY 10504
  management, scenery, and other products to various entertainment end-markets                          
                             
Project Alpha Intermediate Holding, Inc.   Provider of data visualization   Class A common shares             0.42 %   10.7  
and Qlik Parent, Inc.
150 N. Radnor Chester Road
Suite E220
Radnor, PA 19087
  software for data analytics   Class B common shares             0.42 %   0.1  
                             
ProVation Medical, Inc.
800 Washington Avenue North
Suite 400
Minneapolis, MN 55401
  Provider of documentation and coding software for GI physicians   First lien senior secured loan   9.55% (Libor + 6.75%/Q)   3/8/2024           13.0  

137


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Pyramid Management Advisors, LLC and   Hotel operator   First lien senior secured   9.23% (Libor + 6.75%/M)   7/15/2021           1.7 (172)
Pyramid Investors, LLC       revolving loan                      
1 Post Office Square       First lien senior secured   9.25% (Libor + 6.75%/M)   7/15/2021           0.1 (172)
Suite 1900       revolving loan                      
Boston, MA 02109       First lien senior secured loan   9.25% (Libor + 6.75%/M)   7/15/2021           1.5  
        First lien senior secured loan   9.25% (Libor + 6.75%/M)   7/15/2021           17.0  
        Preferred membership units             1.40 %   1.2  
                             
QC Supply, LLC   Specialty distributor and   First lien senior secured   8.50% (Libor + 6.00%/M)   12/29/2021           1.5 (173)
574 Road 11   solutions provider to the   revolving loan                      
Schuyler, NE 68661   swine and poultry markets   First lien senior secured revolving loan   8.50% (Libor + 6.00%/M)   12/29/2021           1.8 (173)
        First lien senior secured revolving loan   8.50% (Libor + 6.00%/M)   12/29/2021           2.1 (173)
        First lien senior secured revolving loan   8.50% (Libor + 6.00%/M)   12/29/2021           3.7 (173)
        First lien senior secured loan   8.50% (Libor + 6.00%/M)   12/29/2022           7.9  
        First lien senior secured loan   8.50% (Libor + 6.00%/M)   12/29/2022           10.1  
        First lien senior secured loan   8.50% (Libor + 6.00%/M)   12/29/2022           13.4  
                             
R1 RCM Inc.
401 North Michigan Avenue
Suite 2700
Chicago, Il 60611
  Revenue cycle management provider to the emergency healthcare industry   First lien senior secured revolving loan       5/8/2023           (174)
                             
R2 Acquisition Corp.
207 NW Park Ave
Portland, OR 97209
  Marketing services   Common stock             0.32 %   0.2  
                             
R3 Education Inc., Equinox EIC   Medical school operator   Common membership             15.76 %   15.1  
Partners LLC and Sierra Education       interest                      
Finance Corp.
1750 W Broadway Street
#222
Oviedo, FL 32765
      Warrant       11/10/2019     10.00 %   8.2 (2)
                             
Radius Aerospace, Inc.
7445 E Lancaster Avenue
  Metal fabricator in the aerospace industry   First lien senior secured revolving loan       3/29/2025           (175)
Fort Worth, TX 76112       First lien senior secured loan   8.35% (Libor + 5.75%/Q)   3/29/2025           8.9  
                             
Ranpak Corp.
7990 Auburn Road
P.O. Box 8004
Concord Township, OH 44077
  Manufacturer and marketer of paper-based protective packaging systems and materials   Second lien senior secured loan   9.73% (Libor + 7.25%/M)   10/3/2022           8.0  
                             
Raptor Technologies, LLC and Rocket Parent, LLC   Provider of SaaS-based safety and security software to the   First lien senior secured revolving loan       12/17/2023           (176)
631 West 22nd St   K-12 school market   First lien senior secured loan       12/17/2024           (177)
Houston, TX 77270       First lien senior secured loan   8.60% (Libor + 6.00%/Q)   12/17/2024           15.9  
        Class A common units             2.27 %   2.4  
                             
RE Community Holdings GP, LLC and RE   Operator of municipal   Limited partnership interest             2.86 %    
Community Holdings, LP   recycling facilities   Limited partnership interest             2.49 %    
809 West Hill Street
Charlotte, NC 28208
                             
                             
RecoveryDirect Acquisition, L.L.C.
2803 Greystone Commercial Boulevard
  Outpatient physical therapy provider   First lien senior secured revolving loan       1/3/2023           (178)
Suite 18       First lien senior secured loan   6.50% (Libor + 4.00%/M)   1/3/2024           6.9  
Birmingham, AL 35242       First lien senior secured loan   6.50% (Libor + 4.25%/M)   1/3/2024           30.7  
                             
Regent Education, Inc.   Provider of software solutions   Warrant       12/23/2026     0.27 %   (2)
340 E. Patrick Street
Suite 201
Frederick, MD 21701
  designed to optimize the financial aid and enrollment processes   Warrant       12/28/2026     8.00 %   (2)
                             
Research Now Group, LLC and Survey Sampling International, LLC
5800 Tennyson Parkway
Suite 600
Plano, TX 75024
  Provider of outsourced data collection to the market research industry   First lien senior secured loan   8.00% (Libor + 5.50%/M)   12/20/2024           56.8  
                             
Respicardia, Inc.   Developer of implantable   Warrant       6/28/2022     0.19 %   (2)
12400 Whitewater Drive   therapies to improve                          
Suite 150   cardiovascular health                          
Minnetonka, MN 55343                              
                             
Retriever Medical/Dental
Payments LLC
  Provider of payment processing services   First lien senior secured revolving loan       2/3/2023           (179)
115 E Stevens Ave   and software to healthcare   First lien senior secured loan   7.30% (Libor + 4.50%/Q)   2/3/2023           2.0  
Valhalla, NY 10595   providers                          
                             

138


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
RF HP SCF Investor, LLC(5)
71 West 23rd Street
New York, NY 10010
  Branded specialty food company   Membership interest             10.08 %   16.7  
                             
Rialto Management
Group, LLC(5)
  Investment and asset management   First lien senior secured revolving loan       12/2/2024           (180)
790 NW 107th Avenue
Suite 400
Miami, FL 33172
  platform focused on real estate   First lien senior secured loan   7.00% (Libor + 4.50%/M)   12/2/2024           1.0  
                             
Riverview Power LLC
2200 Atlantic Street
Suite 800
Stamford, CT 06902
  Operator of natural gas and oil fired power generation facilities   First lien senior secured loan   10.60% (Libor + 8.00%/Q)   12/29/2022           81.2  
                             
RMP Group, Inc
4135 South Stream Blvd
  Revenue cycle management provider to the emergency   First lien senior secured revolving loan       3/2/2022           (181)
Suite 400
Charlotte, NC 28217
  healthcare industry                          
                             
RTI Surgical, Inc.
11621 Research Circle
Alachua, FL 32615
  Manufacturer of biologic, metal and synthetic implants/devices   Second lien senior secured loan   11.24% (Libor + 8.75%/M)   12/5/2023           89.9  
                             
Rug Doctor, LLC and RD
Holdco Inc.(4)
  Manufacturer and marketer of carpet cleaning machines   Second lien senior secured loan   12.43% (Libor + 9.75%/S)   10/31/2019           16.9  
4701 Old Shepard Place       Common stock             45.86 %   4.4  
Plano, TX 75093       Warrant       12/23/2023     46.98 %   (2)
                             
S Toys Holdings LLC   Toy manufacturer   Common units             1.77 %   0.3  
(fka The Step2 Company, LLC)(4)       Class B common units             100.00 %    
10010 Aurora-Hudson Road       Warrant             5.00 %   (2)
Streetsboro, OH 44241                              
                             
Salter Labs
100 Sycamore Rd.
Arvin, CA 93203
  Developer, manufacturer and supplier of consumable products for medical device customers   First lien senior secured revolving loan   7.01% (Libor + 4.25%/Q)   3/11/2020           0.6 (182)
                             
Sanders Industries Holdings, Inc.
and SI Holdings, Inc.
  Manufacturer of elastomeric parts, mid-sized composite   First lien senior secured revolving loan       5/30/2019           (183)
3701 Conany Street   structures, and composite   First lien senior secured loan   9.30% (Libor + 6.50%/Q)   5/30/2020           40.2  
Long Beach, CA 90809   tooling   First lien senior secured loan   9.30% (Libor + 6.50%/Q)   5/30/2020           23.1  
        Common stock             1.83 %   2.1  
                             
Saw Mill PCG Partners LLC   Manufacturer of metal   Common units             66.67 %    
8751 Old State Road 60
Sellersburg, IN 47172
  precision engineered components                          
                             
SCI PH Parent, Inc.
1540 Greenwood Avenue
Montebello, CA 90640
  Industrial container manufacturer, reconditioner and servicer   Series B shares             1.03 %   1.8  
                             
SCM Insurance Services Inc.
5083 Windermere Boulevard
  Provider of claims management,   First lien senior secured revolving loan   7.95% (Base Rate + 4.00%/Q)   8/29/2022           4.0 (184)
SW #101 Edmonton,   claims investigation &   First lien senior secured loan   6.97% (CIBOR + 5.00%/M)   8/29/2024           19.5 (5)
AB T6W 0J5 Canada   support and risk management   Second lien senior secured   10.97% (CIBOR + 9.00%/M)   3/1/2025           54.5 (5)
    solutions for the Canadian   loan                      
    property and casualty insurance industry                          
                             
SCSG EA Acquisition
Company, Inc.
3100 West End Avenue
Suite 800
Nashville, TN 37203
  Provider of outsourced clinical services to hospitals and health systems   First lien senior secured revolving loan       9/1/2022           (185)
                             
SecurAmerica, LLC, ERMC LLC,   Provider of outsourced   First lien senior secured   5.74% (Libor + 3.00%/Q)   6/21/2023           (186)
ERMC Of America, LLC,   manned security guard   revolving loan                      
SecurAmerica Corporation,   services, outsourced   First lien senior secured   5.68% (Libor + 3.00%/Q)   6/21/2023           (186)
ERMC Aviation LLC,   facilities management   revolving loan                      
American Security Programs, Inc.,   and outsourced   First lien senior secured   5.50% (Libor + 3.00%/M)   6/21/2023           (186)
USI LLC and Argenbright   aviation services   revolving loan                      
Holdings IV, LLC       First lien senior secured loan       12/21/2023           (187)
3399 Peachtree Rd       First lien senior secured loan       12/21/2023           (188)
NE—Suite 1500       First lien senior secured loan       12/21/2023           (189)
Atlanta, GA 30326       First lien senior secured loan   9.25% (Libor + 6.75%/M)   12/21/2023           2.2  
        First lien senior secured loan   9.24% (Libor + 6.75%/M)   12/21/2023           25.8  
                             
Securelink, Inc.   Provider of a SaaS   First lien senior secured       8/15/2022           (190)
11402 Bee Cave Road   third-party remote access   revolving loan                      
Austin, TX 78738   software platform                          
                             

139


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Senior Direct Lending Program, LLC(4)(5)   Co-investment vehicle   Subordinated certificates   10.6% (Libor + 8.00%/Q)   12/31/2036           791.9  
2000 Avenue of the Stars       Member interest             87.50 %    
12th Floor                              
Los Angeles, CA 90067                              
                             
Severin Acquisition, LLC   Provider of student   First lien senior secured   5.98% (Libor + 3.25%/Q)   8/1/2023           0.4 (191)
150 Parkshore Drive   information   revolving loan                      
Folsom, CA 95630   system software solutions   First lien senior secured   5.88% (Libor + 3.25%/Q)   8/1/2023           0.7 (191)
    to the K-12 education market   revolving loan                      
        First lien senior secured   5.86% (Libor + 3.25%/Q)   8/1/2023           0.7 (191)
        revolving loan                      
        Second lien senior secured loan   9.49% (Libor + 6.75%/Q)   8/1/2026           79.2  
                             
SFE Intermediate Holdco LLC   Provider of outsourced   First lien senior secured       7/31/2023           (192)
9366 East Raintree Drive   foodservice to K-12   revolving loan                      
Suite 101   school districts   First lien senior secured loan   7.35% (Libor + 4.75%/Q)   7/31/2024           10.7  
Scottdale, AZ 85260       First lien senior secured loan   7.49% (Libor + 4.75%/Q)   7/31/2024           6.7  
                             
Shift PPC LLC   Digital solutions provider   First lien senior secured       12/22/2021           (193)
348 East Maple Road       revolving loan                      
Birmingham, MI 48009       First lien senior secured loan   7.00% (Libor + 4.50%/M)   12/22/2021           1.0  
        First lien senior secured loan   7.38% (Libor + 4.50%/S)   12/22/2021           1.0  
                             
SHO Holding I Corporation   Manufacturer and distributor   Second lien senior secured   11.24% (Libor + 8.50%/Q)   4/27/2023           92.0  
250 S. Australian Avenue   of slip resistant footwear   loan                      
West Palm Beach, FL 33401                              
                             
Shock Doctor, Inc.   Developer, marketer and   Second lien senior secured   13.78% (Libor + 11.00%/Q)   10/22/2021           77.8  
and Shock Doctor   distributor of sports   loan                      
Holdings, LLC(3)   protection equipment   Class A preferred units             3.74 %   0.4  
110 Cheshire Lane   and accessories   Class C preferred units             12.20 %   0.4  
Suite120
Minnetonka, MN 55305
                             
                             
Simpson Performance Products, Inc.   Provider of motorsports   First lien senior secured loan   10.08% (Libor + 7.48%/Q)   2/20/2020           28.3  
328 FM 306
New Braunels, TX 78130
  safety equipment                          
                             
Singer Sewing Company,   Manufacturer of consumer   First lien senior secured   11.49% (Libor + 9.00%/Q)   3/16/2023           2.0 (194)
SVP-Singer Holdings, LLC   sewing machines   revolving loan                      
and SVP-Singer Holdings LP(4)       First lien senior secured   11.58% (Libor + 9.00%/Q)   3/16/2023           1.0 (194)
1224 Heil Quaker Boulevard       revolving loan                      
La Vergne, TN 37086       First lien senior secured   11.57% (Libor + 9.00%/M)   3/16/2023           1.5 (194)
        revolving loan                      
        First lien senior secured   11.80% (Libor + 9.00%/Q)   3/16/2023           71.9 (194)
        revolving loan                      
        First lien senior secured   11.80% (Libor + 9.00%/Q)   3/16/2023           3.5 (194)
        revolving loan                      
        First lien senior secured   11.79% (Libor + 9.00%/Q)   3/16/2023           2.0 (194)
        revolving loan                      
        First lien senior secured   11.78% (Libor + 9.00%/Q)   3/16/2023           1.0 (194)
        revolving loan                      
        First lien senior secured   13.50% (Base Rate + 8.00%/M)   3/16/2023           1.5 (194)
        revolving loan                      
        First lien senior secured loan   5.00% (Libor + 2.40%/Q)   3/16/2023           151.0  
        Class A common units             65.00 %    
                             
SiroMed Physician Services, Inc.   Outsourced anesthesia   First lien senior secured   9.25% (Base Rate + 3.75%/Q)   3/26/2024           2.7 (195)
and SiroMed Equity   provider   revolving loan                      
Holdings, LLC       First lien senior secured loan   7.35% (Libor + 4.75%/Q)   3/26/2024           16.5  
1000 Winter Street       Common units             4.81 %   2.7  
Suite 4300                              
Waltham, MA 02451                              
                             
Siteworx Holdings, LLC &   Provider of design,   First lien senior secured   6.75% (Base Rate + 1.25%/M)   1/2/2020           0.7 (196)
Siteworx LLC   web content management,   revolving loan                      
11480 Commerce Park Dr   eCommerce solutions and   First lien senior secured   6.75% (Base Rate + 1.25%/M)   1/2/2020           0.7 (197)
Suite 300   system integration   revolving loan                      
Reston, VA 20191       First lien senior secured loan   5.50%   1/2/2020           0.9  
        First lien senior secured loan   5.50%   1/2/2020           0.9  
                             
SK SPV IV, LLC   Collision repair site operator   Series A common stock             76.92 %   2.1  
600 N Central Expressway       Series B common stock             76.92 %   2.1  
Suite #4000
Richardson, TX 75080
                             
                             

140


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
SM Wellness Holdings, Inc.   Breast cancer screening   First lien senior secured       8/1/2024           (198)
and SM Holdco, Inc.   provider   revolving loan                      
15601 Dallas Parkway       First lien senior secured loan       8/1/2024           (199)
Suite 500       First lien senior secured loan   8.00% (Libor + 5.50%/M)   8/1/2024           0.7  
Addison, TX 75001       First lien senior secured loan   8.00% (Libor + 5.50%/M)   8/1/2024           7.1  
        Series A preferred stock   13.05% PIK (Libor + 10.45%)         99.94 %   48.9  
        Series A units             2.28 %   0.1  
        Series B units             2.28 %   8.4  
                             
SocialFlow, Inc.   Social media optimization   Warrant       1/29/2026     0.30 %   (2)
52 Vanderbilt Avenue   platform provider                          
12th Floor                              
New York, NY 10017                              
                             
Soil Safe, Inc. and   Provider of soil treatment,   First lien senior secured       1/1/2020           (200)
Soil Safe Acquisition Corp.(4)   recycling and placement   revolving loan                      
6700 Alexander Bell Drive   services   First lien senior secured loan   8.75% (Libor + 6.25%/M)   1/1/2020           17.0  
Suite 300       Second lien senior secured   10.75% (Libor + 7.75%/M)   6/30/2020           12.7  
Columbia, MD 21046       loan                      
        Senior subordinated loan   16.50% PIK   12/31/2020           45.2  
        Senior subordinated loan   14.50% PIK   12/31/2020           37.8  
        Senior subordinated loan       12/31/2020           15.2  
        Common stock             90.00 %    
                             
Sonny's Enterprises, LLC   Manufacturer and supplier of   First lien senior secured   6.75% (Libor + 4.25%/M)   12/1/2022           0.5 (201)
5605 Hiatus Road   car wash equipment, parts   revolving loan                      
Tamarac, FL 33321   and supplies to the conveyorized car wash market   First lien senior secured revolving loan   6.75% (Libor + 4.25%/M)   12/1/2022           1.2 (201)
                             
SoundCloud Limited(5)   Platform for receiving,   Common stock             0.23 %   0.7  
76/77 Rheinsberger Str   sending, and distributing                          
Berlin, 10115 Germany   music                          
                             
Sovos Brands Intermediate, Inc.   Food and beverage platform   First lien senior secured       11/20/2023           (202)
1901 Fourth St #200       revolving loan                      
Berkeley, CA 94710       First lien senior secured loan   7.50% (Libor + 5.00%/M)   11/20/2025           9.9  
        First lien senior secured loan   7.50% (Libor + 5.00%/M)   11/20/2025           6.8  
                             
SpareFoot, LLC   PMS solutions and web   First lien senior secured   6.74% (Libor + 4.25%/M)   4/13/2023           0.3 (203)
3300 Interstate Hwy 35   services for the self-storage   revolving loan                      
Suite 200   industry.   First lien senior secured loan   6.74% (Libor + 4.25%/M)   4/13/2024           1.2  
Austin, TX 78705       First lien senior secured loan   6.74% (Libor + 4.25%/M)   4/13/2024           4.7  
        First lien senior secured loan   6.75% (Libor + 4.25%/Q)   4/13/2024           0.5  
        Second lien senior secured loan   10.75% (Libor + 8.25%/M)   4/13/2025           4.2  
        Second lien senior secured loan   10.75% (Libor + 8.25%/M)   4/13/2025           6.1  
                             
Sparta Systems, Inc.,   Quality management software   First lien senior secured       8/22/2022           (204)
Project Silverback Holdings Corp.   provider   revolving loan                      
and Silverback Holdings, Inc.       Second lien senior secured   10.75% (Libor + 8.25%/M)   8/21/2025           16.8  
2000 Waterview Drive       loan                      
Suite 300       Series B preferred shares             0.32 %    
Hamilton, NJ 08691                              
                             
Spectra Finance, LLC   Venue management and food   First lien senior secured   6.49% (Libor + 4.00%/M)   4/3/2023           4.8 (205)
3601 S. Broad Street   and beverage provider   revolving loan                      
Philadelphia, PA 19148       First lien senior secured loan   6.85% (Libor + 4.25%/Q)   4/2/2024           19.0  
                             
Spin HoldCo Inc.   Laundry service and   Second lien senior secured   10.14% (Libor + 7.50%/Q)   5/14/2023           152.6  
303 Sunnyside Blvd   equipment provider   loan                      
Suite 70                              
Plainview, NY 11803                              
                             
St. Croix Hospice Acquisition Corp.   Provider of hospice services   First lien senior secured       9/29/2022           (206)
7200 Hudson Boulevard North       revolving loan                      
Suites 230 and 100                              
Oakdale, MN 55128                              
                             
Startec Equity, LLC(4)   Communication services   Member interest             100.00 %    
2000 Avenue of the Stars                              
12th Floor                              
Los Angeles, CA 90067                              
                             
Storm UK Holdco Limited and   Provider of water   First lien senior secured       5/5/2022           (207)
Storm US Holdco Inc.(5)   infrastructure software   revolving loan                      
Jacobs Well West Street   solutions for municipalities /                          
Newbury, Berkshire RG14 1BD   utilities and engineering                          
United Kingdom   consulting firms                          
                             
Sundance Energy, Inc.   Oil and gas producer   Second lien senior secured   10.61% (Libor + 8.00%/Q)   4/23/2023           60.7  
633 17th Street       loan                      
Suite 1950                              
Denver, CO 80202                              
                             

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Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Sunk Rock Foundry Partners LP,   Manufacturer of metal   First lien senior secured   7.35% (Libor + 4.75%/Q)   10/31/2022           2.4 (208)
Hatteras Electrical Manufacturing   castings, precision   revolving loan                      
Holding Company and Sigma Electric   machined components   First lien senior secured loan   7.35% (Libor + 4.75%/Q)   10/31/2023           1.6  
Manufacturing Corporation   and sub-assemblies in the   First lien senior secured loan   7.35% (Libor + 4.75%/Q)   10/31/2023           1.7  
120 Sigma Drive   electrical products, power                          
Garner, NC 27529   transmission and distribution                          
    and general industrial markets                          
                             
Sunshine Sub, LLC   Premier health club operator   First lien senior secured       5/27/2024           (209)
4776 New Broad Street       revolving loan                      
Suite 195       First lien senior secured loan   7.25% (Libor + 4.75%/M)   5/27/2024           5.7  
Orlando, FL 32814       First lien senior secured loan   7.25% (Libor + 4.75%/M)   5/27/2024           9.7  
                             
Symmetry Surgical, Inc   Marketer and distributor of   First lien senior secured       7/1/2021           (210)
3034 Owen Drive   medical devices focused on   revolving loan                      
Antioch, TN 37013   the general surgery market                          
                             
Synergy HomeCare   Franchisor of private-pay   First lien senior secured       4/2/2024           (211)
Franchising, LLC and   home care for the elderly   revolving loan                      
NP/Synergy Holdings, LLC       First lien senior secured loan   8.35% (Libor + 5.75%/Q)   4/2/2024           16.0  
500 North Roosevelt       Common units             1.61 %   0.7  
Chandler, AZ 85226                              
                             
Taymax Group Acquisition, LLC   Planet Fitness franchisee   First lien senior secured   7.25% (Libor + 4.75%/M)   7/31/2024           0.1 (212)
and TCP Fit Parent, L.P.       revolving loan                      
5 Industrial Way       First lien senior secured   6.72% (Libor + 4.75%/M)   7/31/2024           0.1 (212)
Unit 3B       revolving loan                      
Salem, NH 03079       First lien senior secured   6.72% (Libor + 4.75%/M)   7/31/2024           0.1 (212)
        revolving loan                      
        First lien senior secured revolving loan   6.72% (Libor + 4.75%/M)   7/31/2024           0.1 (212)
        First lien senior secured revolving loan   7.25% (Libor + 4.75%/M)   7/31/2024           0.1 (212)
        First lien senior secured revolving loan   7.25% (Libor + 4.75%/M)   7/31/2024           0.1 (212)
        First lien senior secured loan       7/31/2025           (213)
        First lien senior secured loan   7.35% (Libor + 4.75%/Q)   7/31/2025           4.3  
        Class A units             1.53 %   3.6  
                             
TDG Group Holding Company   Operator of multiple   First lien senior secured   8.00% (Libor + 5.50%/Q)   5/31/2024           (214)
and TDG Co-Invest, LP   franchise concepts primarily   revolving loan                      
524 W. Waco Drive   related to home maintenance   First lien senior secured   8.06% (Libor + 5.50%/Q)   5/31/2024           (214)
Waco, TX 76701   or repairs   revolving loan                      
        First lien senior secured loan       5/31/2024           (215)
        First lien senior secured loan   8.10% (Libor + 5.50%/Q)   5/31/2024           6.1  
        First lien senior secured loan   8.10% (Libor + 5.50%/Q)   5/31/2024           9.3  
        Preferred units             10.00 %   3.1  
        Common units             10.00 %   0.2  
                             
Teasdale Foods, Inc. and   Provider of beans, sauces   First lien senior secured   8.24% (Libor + 5.75%/M)   10/28/2020           0.1 (216)
Familia Group Holdings Inc.   and hominy to the retail,   revolving loan                      
901 Packers Street   foodservice and wholesale   First lien senior secured   8.24% (Libor + 5.75%/M)   10/28/2020           0.1 (216)
P.O. Box 814   channels   revolving loan                      
Atwater, CA 95301       First lien senior secured loan   8.55% (Libor + 5.25%/Q)   10/28/2020           0.5  
        Second lien senior secured loan   12.56% PIK (Libor + 10.00%/Q)   10/28/2022           26.8  
        Second lien senior secured loan   12.56% PIK (Libor + 10.00%/Q)   10/28/2022           18.1  
        Second lien senior secured loan   12.56% PIK (Libor + 10.00%/Q)   10/28/2022           28.5  
        Warrant                   (2)
                             
Telestream Holdings Corporation   Provider of digital video tools   First lien senior secured       3/24/2022           (217)
848 Gold Flat Road   and workflow solutions to the   revolving loan                      
Nevada City, CA 95959   media and entertainment industries                          
                             
Teligent, Inc.   Pharmaceutical company that   First lien senior secured   6.50% (Libor + 3.75%/Q)   12/13/2023           (218)
105 Lincoln Avenue   develops, manufactures and   revolving loan                      
Buena, NJ 08310   markets injectable   First lien senior secured   6.35% (Libor + 3.75%/Q)   12/13/2023           (218)
    pharmaceutical products   revolving loan                      
        Second lien senior secured loan       6/13/2024           (219)
        Second lien senior secured loan       6/13/2024           (220)
        Second lien senior secured loan   11.35% (Libor + 7.75% Cash, 1.00% PIK/Q)   6/13/2024           18.7  
        Second lien senior secured loan   11.25% PIK (Libor + 8.75%/Q)   6/13/2024           46.3  
                             

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Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
TerSera Therapeutics LLC   Acquirer and developer of   First lien senior secured loan   7.85% (Libor + 5.25%/Q)   3/30/2024           1.1  
150 N. Two Conway Park   specialty therapeutic   First lien senior secured loan   7.85% (Libor + 5.25%/Q)   3/30/2024           1.1  
Suite 195   pharmaceutical products   First lien senior secured loan   7.85% (Libor + 5.25%/Q)   3/30/2024           2.2  
Lake Forest, IL 60045       First lien senior secured loan   7.85% (Libor + 5.25%/Q)   3/30/2023           2.1  
        First lien senior secured loan   7.85% (Libor + 5.25%/Q)   3/30/2023           5.2  
                             
The Teaching Company   Education publications   Preferred stock             1.77 %    
Holdings, Inc.   provider   Common stock             3.64 %    
4151 Lafayette Center Drive                              
#100 Chantilly, VA 20151                              
                             
The Ultimus Group Midco, LLC,   Provider of asset-servicing   First lien senior secured       2/1/2024           (221)
The Ultimus Group, LLC, and   capabilities for fund   revolving loan                      
The Ultimus Group   managers   First lien senior secured loan   6.74% (Libor + 4.25%/M)   2/1/2026           15.6  
Aggregator, LP       First lien senior secured loan   6.74% (Libor + 4.25%/M)   2/1/2026           15.5  
80 Arkay Drive       Class A units             0.53 %   0.2  
Ste 110       Class B units             0.53 %    
Hauppauge, NY 11788       Class A units             0.42 %   1.1  
        Class B units             0.42 %    
                             
Tidi Products, LLC   Manufacturer and supplier of   First lien senior secured       7/1/2020           (222)
570 Enterprise Drive   single-use infection   revolving loan                      
Neenah, WI 54956   prevention products in the medical, dental, and food service markets                          
                             
Total Community Options, Inc.   Service provider for the   First lien senior secured       5/13/2021           (223)
8950 East Lowry Boulevard   elderly and other disabled   revolving loan                      
Denver, CO 80230   individuals in need of care and support                          
                             
Touchstone Acquisition, Inc.   Manufacturer of consumable   First lien senior secured   7.00% (Base Rate + 1.50%/S)   11/15/2023           (224)
and Touchstone Holding, L.P.   products in the dental,   revolving loan                      
5949 Commerce Blvd   medical, cosmetic and CPG/   First lien senior secured loan       11/17/2025           (225)
Morristown, TN 37814   industrial end-markets   First lien senior secured loan   7.25% (Libor + 4.75%/M)   11/17/2025           40.7  
        Class A preferred units   8.00% PIK         1.81 %   2.2  
                             
TowerCo IV Finance LLC   Owner and operator of   First lien senior secured   6.24% (Libor + 3.75%/M)   10/12/2021           0.4 (226)
5000 Valleystone Drive Cary   cellular telecommunications   revolving loan                      
Suite 200   towers   First lien senior secured   6.24% (Libor + 3.75%/M)   10/12/2021           7.3 (226)
Cary, NC 27519       revolving loan                      
        First lien senior secured revolving loan   6.25% (Libor + 3.75%/M)   10/12/2021           1.3 (226)
                             
TU BidCo, Inc.   Provider of outsourced   First lien senior secured       10/1/2023           (227)
3221 Donald Douglas Loop S   customer service management   revolving loan                      
Santa Monica, CA 90405   solutions and back-office   First lien senior secured loan       10/1/2023           (228)
    support services to   First lien senior secured loan   6.50% (Libor + 4.00%/M)   10/1/2023           17.9  
    e-commerce, software and tech-enabled services industries                          
                             
Tyden Group Holding Corp.(5)   Producer and marketer of   Preferred stock             3.84 %   0.4  
P.O. Box 908 Mary Street   global cargo security, product   Common stock             3.84 %   5.3  
GT Walker House   identification and traceability                          
George Town, Grand Cayman   products and utility meter                          
Cayman Islands   products                          
                             
U.S. Acute Care Solutions, LLC   Provider of physician   First lien senior secured       1/1/2022           (229)
4535 Dressler Road   management services   revolving loan                      
Canton, OH 44718                              
                             
U.S. Anesthesia Partners, Inc.   Anesthesiology service   Second lien senior secured   9.75% (Libor + 7.25%/M)   6/23/2025           71.1  
2411 Fountain View Drive   provider   loan                      
Suite 200                              
Houston, TX 77057                              
                             
UL Holding Co., LLC(3)   Provider of collection and   Senior subordinated loan   10.00% PIK   5/2/2020           3.2  
2824 N Ohio   landfill avoidance solutions   Senior subordinated loan       5/2/2020           0.4  
Wichita, KS 67201   for food waste and   Senior subordinated loan   10.00% PIK   5/2/2020           6.9  
    unsold food products   Senior subordinated loan       5/2/2020           0.5  
        Senior subordinated loan   10.00% PIK   5/2/2020           27.7  
        Senior subordinated loan       5/2/2020           3.8  
        Class A common units             8.85 %   0.2  
        Class B-5 common units             40.50 %   0.1  
        Class C common units             8.77 %    
        Warrant             10.44 %   (2)
        Warrant             10.44 %   (2)
        Warrant             10.44 %   (2)
        Warrant             10.44 %   (2)
        Warrant             10.44 %   (2)
        Warrant             10.44 %   (2)
        Warrant             10.44 %   (2)
                             

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Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
Unison Software, Inc. (fka   Provider of enterprise   Second lien senior secured   11.44% (Libor + 8.75%/Q)   11/8/2021           51.0  
Compusearch Software Systems, Inc.)   software and services for   loan                      
21251 Ridgetop Circle   organizations in the public                          
Suite 100   sector                          
Dulles, VA 20166                              
                             
United Digestive MSO Parent, LLC   Gastroenterology physician   First lien senior secured       12/14/2023           (230)
550 Peachtree Street   group   revolving loan                      
N.E Suite 1600       First lien senior secured loan       12/16/2024           (231)
Atlanta, GA 30308       First lien senior secured loan   7.24% (Libor + 4.50%/Q)   12/16/2024           12.4  
                             
Urgent Cares of America Holdings I, LLC   Operator of urgent care   First lien senior secured       2/15/2022           (232)
and FastMed Holdings I, LLC   clinics   revolving loan                      
935 Shotwell Road       Preferred units       6/11/2022     20.00 %   5.4  
Suite 108       Series A common units             1.12 %    
Clayton, NC 27520       Series C common units             20.00 %    
                             
Urology Management Associates, LLC   Urology private practice   First lien senior secured loan   7.50% (Libor + 5.00%/M)   8/31/2024           9.8  
and JWC/UMA Holdings, L.P.       Limited partnership interests             3.64 %   5.0  
1515 Broad Street                              
Suite 120                              
Bloomfield, NJ 07003                              
                             
Utility Pipeline, Ltd.   Natural gas distribution   First lien senior secured       4/18/2022           (233)
140 Broadway   management company   revolving loan                      
New York, NY 10005                              
                             
Varsity Brands Holding Co., Inc.   Leading manufacturer and   Second lien senior secured   10.75% (Libor + 8.25%/M)   12/15/2025           21.1  
and BCPE Hercules Holdings, LP   distributor of textiles,   loan                      
6745 Lenox Center Court   apparel & luxury goods   Second lien senior secured   10.75% (Libor + 8.25%/M)   12/15/2025           47.7  
Memphis, TN 38115       loan                      
        Second lien senior secured   10.75% (Libor + 8.25%/M)   12/15/2025           75.0  
        loan                      
        Class A units             0.17 %   1.5  
                             
Vela Trading Technologies, LLC   Provider of market data   First lien senior secured   7.69% (Libor + 5.00%/Q)   6/30/2022           0.5 (234)
211 East 43rd Street   software and content   revolving loan                      
5th Floor   to global financial services   First lien senior secured loan   7.78% (Libor + 5.00%/Q)   6/30/2022           4.8  
New York, NY 10017   clients                          
                             
Velocity Holdings Corp.   Hosted enterprise resource   Common units             2.00 %   3.6  
13432 Wards Rd   planning application                          
Lynchburg, VA 24501   management services provider                          
                             
Verscend Holding Corp.   Healthcare analytics solutions   First lien senior secured       8/28/2023           (235)
201 Jones Road   provider   revolving loan                      
4th Floor       First lien senior secured loan   7.00% (Libor + 4.50%/M)   8/27/2025           66.4  
Waltham, MA 02451                              
                             
VistaPharm, Inc. and   Manufacturer and distributor   Preferred shares   8.00%         0.35 %   0.5 (5)
Vertice Pharma UK Parent Limited   of generic pharmaceutical                          
630 Central Avenue   products                          
New Providence, NJ 07974                              
                             
Visual Edge Technology, Inc.   Provider of outsourced office   First lien senior secured loan       8/31/2022           (236)
3874 Highland Park   solutions with a focus on   First lien senior secured loan   8.24% (Libor + 5.75%/M)   8/31/2022           6.0  
North Canton, OH 44720   printer and copier equipment   First lien senior secured loan   8.25% (Libor + 5.75%/M)   8/31/2022           3.4  
    and other parts and supplies   First lien senior secured loan   8.25% (Libor + 5.75%/M)   8/31/2022           6.2  
        First lien senior secured loan   8.25% (Libor + 5.75%/M)   8/31/2022           16.7  
        Senior subordinated loan   12.50% PIK   9/2/2024           54.2  
        Warrant       8/31/2027     4.64 %   (2)
        Warrant       8/31/2027     4.64 %   3.9 (2)
                             
Vitesse CLO, Ltd.(5)   Investment vehicle   Preferred shares                    
P.O. Box 1093 Boundary Hall Cricket Square                              
Grand Cayman KY1-1102                              
Cayman Islands                              
                             
VLS Recovery Services, LLC   Provider of commercial and   First lien senior secured   8.48% (Libor + 6.00%/M)   10/17/2023           0.5 (237)
17020 Premium Drive   industrial waste processing   revolving loan                      
Hockley, TX 77447   and disposal services   First lien senior secured   8.48% (Libor + 6.00%/M)   10/17/2023           1.1 (237)
        revolving loan                      
        First lien senior secured   8.49% (Libor + 6.00%/M)   10/17/2023           0.5 (237)
        revolving loan                      
        First lien senior secured revolving loan   8.49% (Libor + 6.00%/M)   10/17/2023           1.1 (237)
        First lien senior secured revolving loan   8.49% (Libor + 6.00%/M)   10/17/2023           0.5 (237)
        First lien senior secured loan       10/17/2023           (238)
                             
Voya CLO 2014-4 Ltd.(5)   Investment vehicle   Subordinated notes   12.50%   7/14/2031           14.6  
P.O. Box 1093 Boundary Hall Cricket Square                              
Grand Cayman KY1-1102                              
Cayman Islands                              
                             

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Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
VPROP Operating, LLC and   Sand-based proppant   First lien senior secured loan   12.13% (Libor + 8.50% Cash,   8/1/2021           28.1  
Vista Proppants and   producer and distributor       1.00% PIK/Q)                  
Logistics, LLC   to the oil and natural   First lien senior secured loan   12.13% (Libor + 8.50% Cash,   8/1/2021           35.1  
4413 Carey Street   gas industry       1.00% PIK/Q)                  
Fort Worth, TX 76119       First lien senior secured loan   12.13% (Libor + 8.50% Cash, 1.00% PIK/Q)   8/1/2021           15.1  
        First lien senior secured loan   12.13% (Libor + 8.50% Cash, 1.00% PIK/Q)   8/1/2021           75.1  
        Common units             8.22 %   10.8  
                             
VRC Companies, LLC   Provider of records and   First lien senior secured   9.00% (Libor + 6.50%/M)   3/31/2022           0.8 (239)
5400 Meltech Blvd   information management   revolving loan                      
Memphis, TN 38118   services   First lien senior secured   11.00% (Base Rate + 5.50%/Q)   3/31/2022           0.2 (239)
        revolving loan                      
        First lien senior secured loan       3/31/2023           (240)
        First lien senior secured loan   9.00% (Libor + 6.50%/M)   3/31/2023           0.2  
        First lien senior secured loan   9.00% (Libor + 6.50%/M)   3/31/2023           1.6  
        First lien senior secured loan   9.00% (Libor + 6.50%/M)   3/31/2023           9.1  
                             
VSC Investors LLC(5)   Investment company   Membership interest             1.95 %   0.9  
401 Vance Street                              
Los Angeles, CA 90272                              
                             
Wand Newco 3, Inc.   Collision repair company   Second lien senior secured   9.73% (Libor + 7.25%/M)   2/5/2027           178.4  
(dba Caliber Collision)       loan                      
401 E Corporate Drive                              
Suite 150                              
Lewisville, TX 75057                              
                             
WASH Multifamily   Laundry service and   Second lien senior secured   9.50% (Libor + 7.00%/M)   5/12/2023           3.6  
Acquisition Inc. and   equipment provider   loan                      
Coinamatic Canada Inc.       Second lien senior secured   9.50% (Libor + 7.00%/M)   5/15/2023           20.6  
3690 Redondo Beach Ave       loan                      
Redondo Beach, CA 90278                              
                             
Watchfire Enterprises, Inc.   Manufacturer of LED   First lien senior secured       4/2/2020           (241)
1015 Maple Street   electronic message   revolving loan                      
Danville, IL 61832   centers and digital billboards                          
                             
West Dermatology, LLC   Dermatology practice   First lien senior secured   8.30% (Libor + 5.50%/Q)   4/28/2022           0.8 (242)
680 Newport Center Drive   platform   revolving loan                      
Suite 150       First lien senior secured   8.13% (Libor + 5.50%/Q)   4/28/2022           0.6 (242)
Newport Beach, CA 92660       revolving loan                      
        First lien senior secured   8.11% (Libor + 5.50%/Q)   4/28/2022           3.7 (242)
        revolving loan                      
        First lien senior secured loan       4/28/2023           (243)
        First lien senior secured loan   8.28% (Libor + 5.50%/Q)   4/28/2023           0.9  
        First lien senior secured loan   8.13% (Libor + 5.50%/Q)   4/28/2023           1.3  
        First lien senior secured loan   8.10% (Libor + 5.50%/Q)   4/28/2023           0.8  
        First lien senior secured loan   8.11% (Libor + 5.50%/Q)   4/28/2023           5.7  
        First lien senior secured loan   8.29% (Libor + 5.50%/Q)   4/28/2023           0.8  
        First lien senior secured loan   8.25% (Libor + 5.50%/Q)   4/28/2023           0.1  
        First lien senior secured loan   8.13% (Libor + 5.50%/Q)   4/28/2023           1.3  
        First lien senior secured loan   8.11% (Libor + 5.50%/Q)   4/28/2023           0.2  
        First lien senior secured loan   8.11% (Libor + 5.50%/Q)   4/28/2023           2.9  
        First lien senior secured loan   8.11% (Libor + 5.50%/Q)   4/28/2023           7.6  
                             
WIRB—Copernicus Group, Inc.   Provider of regulatory,   First lien senior secured       8/15/2022           (244)
202 Carnegie Center   ethical, and safety review   revolving loan                      
Suite 107   services for clinical                          
Princeton, NJ 08540   research involving human subjects                          
                             
Woodstream Group, Inc.   Pet products manufacturer   First lien senior secured loan       5/29/2021           (245)
and Woodstream Corporation       First lien senior secured loan   8.89% (Libor + 6.25%/Q)   5/29/2022           2.7  
69 N Locust Street       First lien senior secured loan   8.86% (Libor + 6.25%/Q)   5/29/2022           4.4  
Lititz, PA 17543       First lien senior secured loan   9.10% (Libor + 6.25%/S)   5/29/2022           4.6  
                             
WorldPay Group PLC(5)   Payment processing company   C2 shares             0.13 %    
25 Walbrook                              
London, EC4N 8AF                              
United Kingdom                              
                             
Worldwide Facilities, LLC   Specialty insurance wholesale   First lien senior secured   6.75% (Libor + 4.25%/M)   4/26/2024           0.4 (246)
725 S. Figueroa Street   broker   revolving loan                      
19th Floor                              
Los Angeles, CA 90017                              
                             
Wrench Group LLC   Provider of essential home   First lien senior secured loan       12/31/2024           (247)
3314 Bear Creek Drive   services to residential                          
Melissa, TX 75454   customers                          
                             

145


Table of Contents

Issuer
  Business Description   Investment   Interest(1)   Maturity Date   % of
Class
Held at
3/31/2019
  Fair Value  
XIFIN, Inc.   Revenue cycle management   First lien senior secured       11/20/2020           (248)
12225 El Camino Real   provider to labs   revolving loan                      
Suite 300                              
San Diego, CA 92130                              
                             
Zemax Software Holdings, LLC   Provider of optical   First lien senior secured       6/25/2024           (249)
10230 NE Points Drive   illumination design   revolving loan                      
Suite 540   software to design engineers   First lien senior secured loan   8.35% (Libor + 5.75%/Q)   6/25/2024           17.0  
Kirkland, WA 98033                              
                             
Zywave, Inc.   Provider of software and   First lien senior secured   7.50% (Libor + 5.00%/M)   11/17/2022           6.3 (250)
10100 W Innovation Drive   technology-enabled content   revolving loan                      
Suite 300   and analytical solutions   Second lien senior secured   11.49% (Libor + 9.00%/M)   11/17/2023           27.0  
Milwaukee, WI 53226   to insurance brokers   loan                      

(1)
All interest is payable in cash unless otherwise indicated. A majority of the variable rate loans to our portfolio companies bear interest at a rate that may be determined by reference to either LIBOR or an alternate Base Rate (commonly based on the Federal Funds Rate or the Prime Rate), at the borrower's option, which resets daily (D), monthly (M), bimonthly (B), quarterly (Q) or semiannually (S). For each such loan, we have provided the current interest rate in effect as of March 31, 2019.

(2)
Percentages shown for warrants or convertible preferred stock held represents the percentages of common stock we may own on a fully diluted basis, assuming we exercise our warrants or convert our preferred stock to common stock.

(3)
As defined in the Investment Company Act, we are an "Affiliate" of this portfolio company because we own 5% or more of the portfolio company's outstanding voting securities.

(4)
As defined in the Investment Company Act, we are an "Affiliate" of this portfolio company because we own 5% or more of the portfolio company's outstanding voting securities or we have the power to exercise control over the management or policies of such portfolio company (including through a management agreement). In addition, as defined in the Investment Company Act, we "Control" this portfolio company because we own more than 25% of the portfolio company's outstanding voting securities or we have the power to exercise control over the management or policies of such portfolio company (including through a management agreement).

(5)
This portfolio company is not a qualifying asset under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of the Company's total assets. Pursuant to Section 55(a) of the Investment Company Act, 15% of the Company's total assets are represented by investments at fair value and other assets that are considered "non-qualifying assets" as of March 31, 2019.

(6)
$2.6 of total commitment of $3.5 remains undrawn as of March 31, 2019

(7)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(8)
Total commitment of $1.2 remains undrawn as of March 31, 2019

(9)
Total commitment of $4.1 remains undrawn as of March 31, 2019

(10)
Total commitment of $10.5 remains undrawn as of March 31, 2019

(11)
Total commitment of $1.9 remains undrawn as of March 31, 2019

(12)
$3.8 of total commitment of $5.0 remains undrawn as of March 31, 2019

(13)
Total commitment of $1.3 remains undrawn as of March 31, 2019

(14)
$0.0 of total commitment of $13.7 remains undrawn as of March 31, 2019

(15)
$25.5 of total commitment of $29.0 remains undrawn as of March 31, 2019

(16)
Total commitment of $7.5 remains undrawn as of March 31, 2019

(17)
Total commitment of $24.4 remains undrawn as of March 31, 2019

(18)
$4.6 of total commitment of $6.1 remains undrawn as of March 31, 2019

(19)
$6.1 of total commitment of $7.0 remains undrawn as of March 31, 2019

(20)
Total commitment of $3.4 remains undrawn as of March 31, 2019

(21)
$0.0 of total commitment of $5.0 remains undrawn as of March 31, 2019

(22)
Total commitment of $4.2 remains undrawn as of March 31, 2019

(23)
Total commitment of $33.1 remains undrawn as of March 31, 2019

(24)
Total commitment of $4.2 remains undrawn as of March 31, 2019

(25)
Total commitment of $2.8 remains undrawn as of March 31, 2019

(26)
$7.2 of total commitment of $9.6 remains undrawn as of March 31, 2019

(27)
Total commitment of $5.5 remains undrawn as of March 31, 2019

(28)
Total commitment of $3.1 remains undrawn as of March 31, 2019

(29)
Total commitment of $3.0 remains undrawn as of March 31, 2019

(30)
Total commitment of $4.4 remains undrawn as of March 31, 2019

(31)
$10.2 of total commitment of $14.3 remains undrawn as of March 31, 2019

(32)
$1.3 of total commitment of $2.0 remains undrawn as of March 31, 2019

146


Table of Contents

(33)
$1.1 of total commitment of $2.3 remains undrawn as of March 31, 2019

(34)
$28.2 of total commitment of $32.2 remains undrawn as of March 31, 2019

(35)
$2.5 of total commitment of $12.0 remains undrawn as of March 31, 2019

(36)
$8.1 of total commitment of $8.5 remains undrawn as of March 31, 2019

(37)
$0.0 of total commitment of $0.0 remains undrawn as of March 31, 2019

(38)
Total commitment of $1.0 remains undrawn as of March 31, 2019

(39)
Total commitment of $5.8 remains undrawn as of March 31, 2019

(40)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(41)
$2.1 of total commitment of $6.3 remains undrawn as of March 31, 2019

(42)
$1.6 of total commitment of $1.9 remains undrawn as of March 31, 2019

(43)
Total commitment of $1.8 remains undrawn as of March 31, 2019

(44)
Total commitment of $4.3 remains undrawn as of March 31, 2019

(45)
$11.5 of total commitment of $15.0 remains undrawn as of March 31, 2019

(46)
$9.1 of total commitment of $10.0 remains undrawn as of March 31, 2019

(47)
Total commitment of $3.0 remains undrawn as of March 31, 2019

(48)
Total commitment of $4.2 remains undrawn as of March 31, 2019

(49)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(50)
$5.7 of total commitment of $5.8 remains undrawn as of March 31, 2019

(51)
Total commitment of $8.1 remains undrawn as of March 31, 2019

(52)
$20.4 of total commitment of $115.0 remains undrawn as of March 31, 2019

(53)
Total commitment of $17.2 remains undrawn as of March 31, 2019

(54)
$2.2 of total commitment of $2.3 remains undrawn as of March 31, 2019

(55)
Total commitment of $3.3 remains undrawn as of March 31, 2019

(56)
Total commitment of $1.2 remains undrawn as of March 31, 2019

(57)
$4.6 of total commitment of $9.9 remains undrawn as of March 31, 2019

(58)
$6.6 of total commitment of $8.8 remains undrawn as of March 31, 2019

(59)
$2.8 of total commitment of $5.6 remains undrawn as of March 31, 2019

(60)
Total commitment of $6.5 remains undrawn as of March 31, 2019

(61)
Total commitment of $4.5 remains undrawn as of March 31, 2019

(62)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(63)
Total commitment of $8.0 remains undrawn as of March 31, 2019

(64)
Total commitment of $20.0 remains undrawn as of March 31, 2019

(65)
Total commitment of $0.8 remains undrawn as of March 31, 2019

(66)
Total commitment of $9.5 remains undrawn as of March 31, 2019

(67)
$1.2 of total commitment of $2.0 remains undrawn as of March 31, 2019

(68)
$9.0 of total commitment of $9.8 remains undrawn as of March 31, 2019

(69)
Total commitment of $10.0 remains undrawn as of March 31, 2019

(70)
Total commitment of $6.0 remains undrawn as of March 31, 2019

(71)
Total commitment of $8.4 remains undrawn as of March 31, 2019

(72)
Total commitment of $1.5 remains undrawn as of March 31, 2019

(73)
$12.3 of total commitment of $15.8 remains undrawn as of March 31, 2019

(74)
Total commitment of $6.5 remains undrawn as of March 31, 2019

(75)
Total commitment of $9.6 remains undrawn as of March 31, 2019

(76)
Total commitment of $1.6 remains undrawn as of March 31, 2019

(77)
$1.5 of total commitment of $2.1 remains undrawn as of March 31, 2019

(78)
Total commitment of $1.2 remains undrawn as of March 31, 2019

(79)
$4.0 of total commitment of $7.5 remains undrawn as of March 31, 2019

147


Table of Contents

(80)
Total commitment of $3.8 remains undrawn as of March 31, 2019

(81)
Total commitment of $30.6 remains undrawn as of March 31, 2019

(82)
Total commitment of $1.5 remains undrawn as of March 31, 2019

(83)
Total commitment of $1.5 remains undrawn as of March 31, 2019

(84)
Total commitment of $6.6 remains undrawn as of March 31, 2019

(85)
Total commitment of $1.1 remains undrawn as of March 31, 2019

(86)
Total commitment of $2.0 remains undrawn as of March 31, 2019

(87)
Total commitment of $19.0 remains undrawn as of March 31, 2019

(88)
$0.1 of total commitment of $2.0 remains undrawn as of March 31, 2019

(89)
$16.3 of total commitment of $16.8 remains undrawn as of March 31, 2019

(90)
Total commitment of $0.4 remains undrawn as of March 31, 2019

(91)
Total commitment of $11.0 remains undrawn as of March 31, 2019

(92)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(93)
$3.7 of total commitment of $3.9 remains undrawn as of March 31, 2019

(94)
$7.2 of total commitment of $7.4 remains undrawn as of March 31, 2019

(95)
Total commitment of $1.4 remains undrawn as of March 31, 2019

(96)
Total commitment of $3.5 remains undrawn as of March 31, 2019

(97)
$9.5 of total commitment of $9.9 remains undrawn as of March 31, 2019

(98)
$1.8 of total commitment of $12.1 remains undrawn as of March 31, 2019

(99)
Total commitment of $4.5 remains undrawn as of March 31, 2019

(100)
$0.0 of total commitment of $6.2 remains undrawn as of March 31, 2019

(101)
$3.0 of total commitment of $3.0 remains undrawn as of March 31, 2019

(102)
Total commitment of $5.3 remains undrawn as of March 31, 2019

(103)
$17.0 of total commitment of $20.3 remains undrawn as of March 31, 2019

(104)
Total commitment of $3.2 remains undrawn as of March 31, 2019

(105)
Total commitment of $15.1 remains undrawn as of March 31, 2019

(106)
Total commitment of $4.0 remains undrawn as of March 31, 2019

(107)
$4.2 of total commitment of $5.8 remains undrawn as of March 31, 2019

(108)
Total commitment of $3.9 remains undrawn as of March 31, 2019

(109)
$3.3 of total commitment of $6.1 remains undrawn as of March 31, 2019

(110)
Total commitment of $3.5 remains undrawn as of March 31, 2019

(111)
Total commitment of $1.3 remains undrawn as of March 31, 2019

(112)
$7.5 of total commitment of $8.0 remains undrawn as of March 31, 2019

(113)
$0.1 of total commitment of $5.0 remains undrawn as of March 31, 2019

(114)
Total commitment of $2.8 remains undrawn as of March 31, 2019

(115)
$6.5 of total commitment of $6.9 remains undrawn as of March 31, 2019

(116)
Total commitment of $3.8 remains undrawn as of March 31, 2019

(117)
$0.8 of total commitment of $0.9 remains undrawn as of March 31, 2019

(118)
Total commitment of $3.9 remains undrawn as of March 31, 2019

(119)
Total commitment of $3.0 remains undrawn as of March 31, 2019

(120)
$0.0 of total commitment of $0.0 remains undrawn as of March 31, 2019

(121)
Total commitment of $8.4 remains undrawn as of March 31, 2019

(122)
$7.3 of total commitment of $7.5 remains undrawn as of March 31, 2019

(123)
$2.5 of total commitment of $2.5 remains undrawn as of March 31, 2019

(124)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(125)
Total commitment of $2.7 remains undrawn as of March 31, 2019

(126)
Total commitment of $23.3 remains undrawn as of March 31, 2019

148


Table of Contents

(127)
$2.7 of total commitment of $4.6 remains undrawn as of March 31, 2019

(128)
$3.2 of total commitment of $4.5 remains undrawn as of March 31, 2019

(129)
Total commitment of $10.9 remains undrawn as of March 31, 2019

(130)
Total commitment of $14.5 remains undrawn as of March 31, 2019

(131)
Total commitment of $2.4 remains undrawn as of March 31, 2019

(132)
$0.9 of total commitment of $2.6 remains undrawn as of March 31, 2019

(133)
Total commitment of $1.5 remains undrawn as of March 31, 2019

(134)
Total commitment of $2.0 remains undrawn as of March 31, 2019

(135)
Total commitment of $16.8 remains undrawn as of March 31, 2019

(136)
Total commitment of $10.0 remains undrawn as of March 31, 2019

(137)
$4.1 of total commitment of $10.0 remains undrawn as of March 31, 2019

(138)
Total commitment of $5.2 remains undrawn as of March 31, 2019

(139)
Total commitment of $9.0 remains undrawn as of March 31, 2019

(140)
Total commitment of $3.0 remains undrawn as of March 31, 2019

(141)
Total commitment of $13.5 remains undrawn as of March 31, 2019

(142)
$5.1 of total commitment of $25.0 remains undrawn as of March 31, 2019

(143)
Total commitment of $0.0 remains undrawn as of March 31, 2019

(144)
Total commitment of $1.4 remains undrawn as of March 31, 2019

(145)
$7.5 of total commitment of $9.1 remains undrawn as of March 31, 2019

(146)
Total commitment of $6.6 remains undrawn as of March 31, 2019

(147)
Total commitment of $12.5 remains undrawn as of March 31, 2019

(148)
$9.9 of total commitment of $12.5 remains undrawn as of March 31, 2019

(149)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(150)
Total commitment of $3.3 remains undrawn as of March 31, 2019

(151)
Total commitment of $3.8 remains undrawn as of March 31, 2019

(152)
$0.0 of total commitment of $10.0 remains undrawn as of March 31, 2019

(153)
Total commitment of $6.0 remains undrawn as of March 31, 2019

(154)
$1.8 of total commitment of $2.5 remains undrawn as of March 31, 2019

(155)
Total commitment of $5.4 remains undrawn as of March 31, 2019

(156)
$9.2 of total commitment of $9.7 remains undrawn as of March 31, 2019

(157)
Total commitment of $21.1 remains undrawn as of March 31, 2019

(158)
Total commitment of $54.9 remains undrawn as of March 31, 2019

(159)
Total commitment of $7.6 remains undrawn as of March 31, 2019

(160)
Total commitment of $1.1 remains undrawn as of March 31, 2019

(161)
Total commitment of $2.9 remains undrawn as of March 31, 2019

(162)
Total commitment of $1.3 remains undrawn as of March 31, 2019

(163)
Total commitment of $4.0 remains undrawn as of March 31, 2019

(164)
Total commitment of $5.0 remains undrawn as of March 31, 2019

(165)
Total commitment of $1.4 remains undrawn as of March 31, 2019

(166)
Total commitment of $5.8 remains undrawn as of March 31, 2019

(167)
Total commitment of $5.9 remains undrawn as of March 31, 2019

(168)
$2.3 of total commitment of $3.3 remains undrawn as of March 31, 2019

(169)
Total commitment of $2.9 remains undrawn as of March 31, 2019

(170)
$33.0 of total commitment of $36.0 remains undrawn as of March 31, 2019

(171)
Total commitment of $4.0 remains undrawn as of March 31, 2019

(172)
$3.6 of total commitment of $5.5 remains undrawn as of March 31, 2019

(173)
$0.0 of total commitment of $10.0 remains undrawn as of March 31, 2019

149


Table of Contents

(174)
Total commitment of $10.0 remains undrawn as of March 31, 2019

(175)
Total commitment of $1.8 remains undrawn as of March 31, 2019

(176)
Total commitment of $1.6 remains undrawn as of March 31, 2019

(177)
Total commitment of $8.5 remains undrawn as of March 31, 2019

(178)
Total commitment of $8.0 remains undrawn as of March 31, 2019

(179)
Total commitment of $3.5 remains undrawn as of March 31, 2019

(180)
Total commitment of $1.0 remains undrawn as of March 31, 2019

(181)
Total commitment of $1.8 remains undrawn as of March 31, 2019

(182)
$1.1 of total commitment of $1.7 remains undrawn as of March 31, 2019

(183)
Total commitment of $10.0 remains undrawn as of March 31, 2019

(184)
$0.0 of total commitment of $4.0 remains undrawn as of March 31, 2019

(185)
$3.7 of total commitment of $4.0 remains undrawn as of March 31, 2019

(186)
$0.0 of total commitment of $0.0 remains undrawn as of March 31, 2019

(187)
Total commitment of $7.5 remains undrawn as of March 31, 2019

(188)
Total commitment of $2.1 remains undrawn as of March 31, 2019

(189)
Total commitment of $9.0 remains undrawn as of March 31, 2019

(190)
Total commitment of $3.0 remains undrawn as of March 31, 2019

(191)
$7.1 of total commitment of $9.0 remains undrawn as of March 31, 2019

(192)
Total commitment of $10.2 remains undrawn as of March 31, 2019

(193)
Total commitment of $4.4 remains undrawn as of March 31, 2019

(194)
$4.3 of total commitment of $90.0 remains undrawn as of March 31, 2019

(195)
$4.3 of total commitment of $7.1 remains undrawn as of March 31, 2019

(196)
$0.0 of total commitment of $0.8 remains undrawn as of March 31, 2019

(197)
$0.0 of total commitment of $0.8 remains undrawn as of March 31, 2019

(198)
Total commitment of $9.1 remains undrawn as of March 31, 2019

(199)
Total commitment of $1.4 remains undrawn as of March 31, 2019

(200)
$6.9 of total commitment of $10.5 remains undrawn as of March 31, 2019

(201)
$1.9 of total commitment of $3.6 remains undrawn as of March 31, 2019

(202)
Total commitment of $4.3 remains undrawn as of March 31, 2019

(203)
$1.1 of total commitment of $1.4 remains undrawn as of March 31, 2019

(204)
Total commitment of $6.5 remains undrawn as of March 31, 2019

(205)
$19.2 of total commitment of $24.1 remains undrawn as of March 31, 2019

(206)
Total commitment of $2.0 remains undrawn as of March 31, 2019

(207)
Total commitment of $1.1 remains undrawn as of March 31, 2019

(208)
$7.4 of total commitment of $10.0 remains undrawn as of March 31, 2019

(209)
Total commitment of $5.8 remains undrawn as of March 31, 2019

(210)
Total commitment of $3.1 remains undrawn as of March 31, 2019

(211)
Total commitment of $4.2 remains undrawn as of March 31, 2019

(212)
$1.1 of total commitment of $1.6 remains undrawn as of March 31, 2019

(213)
Total commitment of $1.6 remains undrawn as of March 31, 2019

(214)
$0.2 of total commitment of $0.3 remains undrawn as of March 31, 2019

(215)
Total commitment of $14.3 remains undrawn as of March 31, 2019

(216)
$0.6 of total commitment of $0.8 remains undrawn as of March 31, 2019

(217)
$2.2 of total commitment of $2.3 remains undrawn as of March 31, 2019

(218)
$0.0 of total commitment of $0.0 remains undrawn as of March 31, 2019

(219)
Total commitment of $13.7 remains undrawn as of March 31, 2019

(220)
Total commitment of $9.1 remains undrawn as of March 31, 2019

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(221)
Total commitment of $6.9 remains undrawn as of March 31, 2019

(222)
Total commitment of $2.3 remains undrawn as of March 31, 2019

(223)
Total commitment of $4.2 remains undrawn as of March 31, 2019

(224)
$0.0 of total commitment of $0.0 remains undrawn as of March 31, 2019

(225)
Total commitment of $11.2 remains undrawn as of March 31, 2019

(226)
$8.0 of total commitment of $17.0 remains undrawn as of March 31, 2019

(227)
$15.2 of total commitment of $15.3 remains undrawn as of March 31, 2019

(228)
Total commitment of $3.2 remains undrawn as of March 31, 2019

(229)
Total commitment of $1.7 remains undrawn as of March 31, 2019

(230)
Total commitment of $8.4 remains undrawn as of March 31, 2019

(231)
Total commitment of $8.8 remains undrawn as of March 31, 2019

(232)
Total commitment of $10.0 remains undrawn as of March 31, 2019

(233)
Total commitment of $3.0 remains undrawn as of March 31, 2019

(234)
$3.0 of total commitment of $3.5 remains undrawn as of March 31, 2019

(235)
Total commitment of $22.5 remains undrawn as of March 31, 2019

(236)
Total commitment of $0.8 remains undrawn as of March 31, 2019

(237)
$8.0 of total commitment of $12.1 remains undrawn as of March 31, 2019

(238)
Total commitment of $8.5 remains undrawn as of March 31, 2019

(239)
$0.6 of total commitment of $1.5 remains undrawn as of March 31, 2019

(240)
Total commitment of $4.2 remains undrawn as of March 31, 2019

(241)
Total commitment of $2.0 remains undrawn as of March 31, 2019

(242)
$2.0 of total commitment of $7.0 remains undrawn as of March 31, 2019

(243)
Total commitment of $7.2 remains undrawn as of March 31, 2019

(244)
$3.0 of total commitment of $3.0 remains undrawn as of March 31, 2019

(245)
Total commitment of $4.7 remains undrawn as of March 31, 2019

(246)
$0.9 of total commitment of $1.3 remains undrawn as of March 31, 2019

(247)
Total commitment of $2.8 remains undrawn as of March 31, 2019

(248)
$4.5 of total commitment of $4.6 remains undrawn as of March 31, 2019

(249)
Total commitment of $4.1 remains undrawn as of March 31, 2019

(250)
$5.2 of total commitment of $11.5 remains undrawn as of March 31, 2019

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MANAGEMENT

              Our business and affairs are managed under the direction of our board of directors. The responsibilities of the board of directors include, among other things, the quarterly valuation of our investments. The size of our board of directors is set at nine members and currently consists of four directors who are "interested persons" of Ares Capital as defined in Section 2(a)(19) of the Investment Company Act and five directors who are not such "interested persons." We refer to the directors who are non-interested persons as our "independent directors." We refer to our directors who are "interested persons" as our "interested directors." Our board of directors elects our officers, who serve at the discretion of the board of directors. The board of directors maintains an audit committee and nominating and governance committee, and may establish additional committees from time to time as necessary.

              Under our charter and bylaws, our directors are divided into three classes. Directors are elected for staggered terms of three years each, with the term of office of only one of these three classes of directors expiring each year. Each director will hold office for the term to which he or she is elected and until his or her successor is duly elected and qualifies.

BOARD OF DIRECTORS, EXECUTIVE OFFICERS AND CERTAIN OTHER OFFICERS

Name, Address and Age(1)
  Position(s)
Held with
Fund
  Term of
Office and
Length of
Time Served
  Principal Occupation(s)
During Past 5 Years
  Number of
Portfolios in
Fund
Complex
Overseen by
Director
  Other Directorships
of Public or
Registered Investment
Companies Held by
Director During
Past 5 Years
Independent Directors                    

Steve Bartlett, 71

 

Director

 

Class II Director since 2012 (re-election in 2021)

 

Since 2012, Mr. Bartlett has been providing strategic independent consulting services to several U.S. corporations. From 1999 to 2012, Mr. Bartlett served as President and Chief Executive Officer of the Financial Services Roundtable.

 

One(2)

 

Intersections Inc.

Ann Torre Bates, 61

 

Director

 

Class I Director since 2010 (re-election in 2020)

 

Ms. Bates currently dedicates her time serving on boards of directors of several companies in the financial sector. From 1997 to 2012, Ms. Bates was a strategic and financial consultant, principally with respect to corporate finance matters.

 

One(2)

 

Navient Corporation, SLM Corporation, United Natural Foods, Inc., 19 investment companies in the Franklin Templeton Group of Mutual Funds

Daniel G. Kelly, Jr., 67

 

Director

 

Class III Director since 2016 (re-election in 2019)

 

Since 2016, Mr. Kelly has been retired. From 1999 to 2015, Mr. Kelly was a Partner of the law firm of Davis Polk & Wardwell LLP.

 

One(2)

 

American Shared Hospital Services

Steven B. McKeever, 58

 

Director

 

Class I Director since 2012 (re-election in 2020)

 

Since 1997, Mr. McKeever has been Chief Executive Officer of Hidden Beach Recordings, an independent record label based in Los Angeles, California.

 

One(2)

 

 

Eric B. Siegel, 61

 

Director

 

Class III Director since 2004 (re-election in 2019)

 

Since 2005, Mr. Siegel has served as Special Advisor to the Chairman of the Milwaukee Brewers Baseball Club and a member of the Club's Board of Advisors. Mr. Siegel is a director and Chairman of the Executive Committee and Nominating and Governance Committee and member of the Audit Committee and Security Committee of El Paso Electric Company, a NYSE publicly traded utility company.

 

One(2)

 

El Paso Electric Company

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Name, Address and Age(1)
  Position(s)
Held with
Fund
  Term of
Office and
Length of
Time Served
  Principal Occupation(s)
During Past 5 Years
  Number of
Portfolios in
Fund
Complex
Overseen by
Director
  Other Directorships
of Public or
Registered Investment
Companies Held by
Director During
Past 5 Years
Interested Directors                    

Michael J Arougheti, 46(3)

 

Co-Chairman and Director; Executive Vice President

 

Class I Director since February 2009 (re-election in 2020); Executive Vice President since October 2014 (indefinite term)

 

Since October 2014, Mr. Arougheti has served as an Executive Vice President of the Company, since July 2014, he has served as Co-Chairman of the Board and since February 2009, he has served as a director of the Company. Mr. Arougheti previously served as Chief Executive Officer of the Company from May 2013 to July 2014 and President of the Company from May 2004 to May 2013. Mr. Arougheti is a Co-Founder and the Chief Executive Officer and President, as well as a Director, of Ares. He is also a member of the Ares Executive Management Committee and the Management Committee of Ares. Mr. Arougheti is a member of the Investment Committee of the Ares Credit Group's U.S. Direct Lending Investment Committee and the Ares Equity Income Opportunity Strategy Portfolio Review Committee.

 

One(2)

 

Ares Management Corporation, Ares Commercial Real Estate Corporation

R. Kipp deVeer, 46(6)

 

Director and Chief Executive Officer

 

Class III Director since 2015 (re-election in 2019); Chief Executive Officer since July 2014 (indefinite term)

 

Since July 2014, Mr. deVeer has served as Chief Executive Officer of the Company. Mr. deVeer previously served as President of the Company from May 2013 to July 2014. Mr. deVeer joined Ares in May 2004 and currently serves as a Partner of Ares and a member of the Ares Executive Management Committee. He is a Partner in and Head of the Ares Credit Group and also a member of the Management Committee of Ares. Mr. deVeer is a member of the Investment Committees of our investment adviser and the Ares Credit Group's U.S. Direct Lending and European Direct Lending Investment Committees and other select Ares Credit Group investment committees. Mr. deVeer is also a director of Ares Management Limited, a subsidiary of Ares overseeing the European activities of Ares.

 

One(2)

 

 

Robert L. Rosen, 72(4)

 

Director

 

Class II Director since 2004 (re-election in 2021)

 

Since August 2005, Mr. Rosen has served as the managing partner of RLR Capital Partners, which invests principally in the securities of publicly traded North American companies. From 1987 to the present, Mr. Rosen has been Chief Executive Officer of RLR Partners, LLC, a private investment firm with interests in financial services, healthcare, media and multi-industry companies. From 2013 to 2016, Mr. Rosen was an Operating Advisor to the Ares Management Private Equity Group. From February 2016 to February 2018, Mr. Rosen was a Partner of Ares. Since February 2018, Mr. Rosen has been party to a strategic advisory agreement with Ares.

 

One(2)

 

Ares Commercial Real Estate Corporation, Sapient Corporation

Bennett Rosenthal, 55(5)

 

Co-Chairman and Director

 

Class II Director since 2004 (re-election in 2021)

 

Since July 2014, Mr. Rosenthal has served as Co-Chairman of the Board, and previously as Chairman of the Board since 2004. Mr. Rosenthal is a Co-Founder of Ares and a Director and Partner of Ares and a member of the Ares Executive Management Committee. He is Co-Head of and a Partner in the Ares Private Equity Group and also serves as a member of the Management Committee of Ares. Mr. Rosenthal is also a member of the Investment Committees of certain funds managed by the Ares Private Equity Group.

 

One(2)

 

Ares Management Corporation, Nortek, Inc.

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Name, Address and Age(1)
  Position(s)
Held with
Fund
  Term of
Office and
Length of
Time Served
  Principal Occupation(s)
During Past 5 Years
  Number of
Portfolios in
Fund
Complex
Overseen by
Director
  Other Directorships
of Public or
Registered Investment
Companies Held by
Director During
Past 5 Years
Executive Officers and Certain Other Officers Who Are Not Directors        

Joshua M. Bloomstein, 45

 

General Counsel, Vice President and Secretary

 

General Counsel since January 2010; Secretary since December 2010; Vice President since November 2006 (indefinite terms)

 

Since January 2010, Mr. Bloomstein has served as General Counsel of the Company, since December 2010, Mr. Bloomstein has served as Secretary of the Company, and since November 2006, Mr. Bloomstein has served as Vice President of the Company. Additionally, he is Vice President and Assistant Secretary of CION Ares Diversified Credit Fund and Vice President and Assistant Secretary of Ares Commercial Real Estate Corporation. He joined Ares in November 2006 and currently serves as a Partner and Co-General Counsel (Credit) and Deputy General Counsel (Corporate) of Ares Management.

 

 

 

 

Mitchell Goldstein, 52

 

Co-President

 

Since July 2014 (indefinite term)

 

Since July 2014, Mr. Goldstein has served as a Co-President of the Company. Mr. Goldstein previously served as an Executive Vice President of the Company from May 2013 to July 2014. He joined Ares in May 2005 and currently serves as a Partner and Co-Head of the Ares Credit Group, and Vice President of CION Ares Diversified Credit Fund. He is a member of the Management Committee of Ares. Mr. Goldstein is a member of the Investment Committees of our investment adviser, the Board of Managers of Ivy Hill Asset Management GP, LLC, the General Partner of Ivy Hill Asset Management, L.P., select Ares Credit Group U.S. Direct Lending investment committees, the Ivy Hill Asset Management Investment Committee and the Ares Commercial Finance Investment Committee.

 

 

 

 

Miriam Krieger, 42

 

Vice President

 

Since April 2019 (indefinite term)

 

Since April 2019, Ms. Krieger has served as Vice President of the Company. Ms. Krieger previously served as Chief Compliance Officer of the Company from June 2011 to April 2019. She joined Ares in 2010 and is a Partner and Global Chief Compliance Officer of Ares and is a member of the Management Committee of Ares. She also serves as Chief Compliance Officer of Ivy Hill Asset Management, L.P.

 

 

 

 

Scott C. Lem, 41

 

Chief Accounting Officer, Vice President and Treasurer

 

Chief Accounting Officer since December 2013; Vice President and Treasurer since May 2013 (indefinite terms)

 

Since December 2013, Mr. Lem has served as Chief Accounting Officer of the Company and since May 2013, Mr. Lem has served as Vice President and Treasurer of the Company. Mr. Lem previously served as Assistant Treasurer of the Company from May 2009 to May 2013. He also serves as Chief Financial Officer of Ares Dynamic Credit Allocation Fund, Inc. and Chief Financial Officer of CION Ares Diversified Credit Fund. Additionally, he is a Partner and Chief Accounting Officer, Credit (Direct Lending) in the Ares Finance Department.

 

 

 

 

Lisa A. Morgan, 43

 

Chief Compliance Officer

 

Since April 2019 (indefinite term)

 

Since April 2019, Ms. Morgan has served as Chief Compliance Officer of the Company. She joined Ares in September 2017 as Managing Director and Head of Regulatory Compliance in the Ares Compliance Group. From January 2015 to September 2017, Ms. Morgan was a Partner of the law firm of Eversheds Sutherland (US) LLP, and from January 2012 to December 2014, she was Counsel at Eversheds Sutherland (US) LLP.

 

 

 

 

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Name, Address and Age(1)
  Position(s)
Held with
Fund
  Term of
Office and
Length of
Time Served
  Principal Occupation(s)
During Past 5 Years
  Number of
Portfolios in
Fund
Complex
Overseen by
Director
  Other Directorships
of Public or
Registered Investment
Companies Held by
Director During
Past 5 Years
Penni F. Roll, 53   Chief Financial Officer   Since December 2010 (indefinite term)   Since December 2010, Ms. Roll has served as Chief Financial Officer of the Company. Ms. Roll serves as the Treasurer of CION Ares Diversified Credit Fund and Chief Financial Officer, Vice President and Treasurer of Ivy Hill Asset Management, L.P. and Treasurer of Ares Dynamic Credit Allocation Fund, Inc. She joined Ares in 2010 and now serves as a Partner and Chief Financial Officer of the Ares Credit Group and is a member of the Management Committee of Ares.        

Michael L. Smith, 48

 

Co-President

 

Since July 2014 (indefinite term)

 

Since July 2014, Mr. Smith has served as a Co-President of the Company. Mr. Smith previously served as an Executive Vice President of the Company from May 2013 to July 2014. Mr. Smith joined Ares in May 2004 and currently serves as a Partner and Co-Head of the Ares Credit Group and a member of the Management Committee of Ares. Mr. Smith is a member of the Investment Committees of Ares Capital Management, Ares Credit Group's U.S. Direct Lending and Commercial Finance Investment Committees, the Ares Private Equity Group's Special Opportunities Investment Committee, the Infrastructure and Power Group Funds Investment Committee and the Ivy Hill Asset Management Investment Committee.

 

 

 

 

Michael D. Weiner, 66

 

Vice President

 

Since September 2006 (indefinite term)

 

Since September 2006, Mr. Weiner has been Vice President of the Company. He is Executive Vice President and Chief Legal Officer of Ares Management Corporation, a Partner and Co-General Counsel in the Ares Legal Group and a member of the Management Committee of Ares. Mr. Weiner has also served as Vice President and General Counsel of Ares Commercial Real Estate Corporation since 2012, Vice President and Assistant Secretary of Ares Dynamic Credit Allocation Fund, Inc. and Vice President and Assistant Secretary of CION Ares Diversified Credit Fund. He additionally is a member of the Ares Enterprise Risk Committee.

 

 

 

 

(1)
The business address of Messrs. Arougheti, Bloomstein, deVeer, Goldstein, Rosen and Smith and Ms. Roll is c/o Ares Capital Corporation, 245 Park Avenue, 44th Floor, New York, New York 10167. The business address of Mmes. Krieger and Morgan is c/o Ares Capital Corporation, 1001 19th Street, North Suite 1200, Arlington, Virginia 22209. The business address of each other director, executive officer and listed officer is c/o Ares Capital Corporation, 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067.

(2)
Including the Company.

(3)
Mr. Arougheti is an interested director because he is an Executive Vice President of the Company, is a Co-Founder and the Chief Executive Officer and President of Ares, is a member of the Ares Executive Management Committee, is on the Investment Committee of our investment adviser and serves on the Board of Directors and the Management Committee of Ares.

(4)
Mr. Rosen is an interested director because RLR Capital Partners and Mr. Rosen are parties to a strategic advisory agreement with Ares and Mr. Rosen owns certain equity interests in Ares and its affiliates.

(5)
Mr. Rosenthal is an interested director because he is a Co-Founder of Ares, a Partner of Ares Management Corporation and a member of the Ares Executive Management Committee and serves on the Board of Directors and the Management Committee of Ares.

(6)
Mr. deVeer is an interested director because he is the Chief Executive Officer of the Company, is on the Investment Committee of our investment adviser, is a Partner of Ares Management Corporation and is a member of the Ares Executive Management Committee and serves on the Management Committee of Ares.

Biographical Information and Discussion of Experience and Qualifications, etc.

Directors

              As described below under "Committees of the Board of Directors—Nominating and Governance Committee," the board of directors has identified certain desired attributes for director nominees. Each of our directors has demonstrated high character and integrity, superior credentials and recognition in his or her respective field and the relevant expertise and experience upon which to be

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able to offer advice and guidance to our management. Each of our directors also has sufficient time available to devote to the affairs of the Company, is able to work with the other members of the board of directors and contribute to the success of the Company and can represent the long-term interests of the Company's stockholders as a whole. Our directors have been selected such that the board of directors represents a range of backgrounds and experience. Set forth below is biographical information of each director, including a discussion of such director's particular experience, qualifications, attributes or skills that lead us and our board of directors to conclude, as of the date of this prospectus, that such individual should serve as a director, in light of the Company's business and structure.

Independent Directors

               Steve Bartlett , 71, has served as a director of the Company since 2012 and currently serves on the audit committee. Mr. Bartlett has been a consultant since 2012, providing strategic independent consulting services to several U.S. corporations. From 1999 to 2012, Mr. Bartlett served as President and Chief Executive Officer of the Financial Services Roundtable. In 2001, Mr. Bartlett served on the President's Commission on Excellence in Special Education. Mr. Bartlett previously served as the Mayor of Dallas, Texas from 1991 to 1995, a member of the United States Congress from 1983 to 1991, and a member of the Dallas City Council from 1977 to 1981. Mr. Bartlett also founded Meridian Products Corporation, a manufacturer of injection molded plastics in 1976. Mr. Bartlett previously served on the Board of Governors of the National YMCA, the board of directors of BIPAC and Easter Seals of Greater Washington, D.C., and the board of directors for the following companies: Centene Corporation (NYSE), IMCO Recycling, Inc. (NYSE), KB Home Corporation (NYSE), Sun Coast Industries (NYSE), Intersections Inc. (NASDAQ), Dallas Can! and Grace Presbyterian Village. Mr. Bartlett also served as co-chair of Character Counts of Dallas and chair of the Trinity Trails. Mr. Bartlett also served on the Dallas Fort Worth International Airport Board. Mr. Bartlett graduated from the University of Texas at Austin in 1971, later serving as a guest lecturer at the Lyndon B. Johnson School of Public Affairs. We believe that Mr. Bartlett's experience serving as President and Chief Executive Officer of the Financial Services Roundtable, his experience in politics (including serving as the Mayor of Dallas, Texas, a member of the United States Congress and a member of the Dallas City Council) and his service as a director of public and private companies provides the board of directors with key experience and insight to the Company, especially with respect to issues specific to boards of directors of public companies and companies in the financial services industry.

               Ann Torre Bates , 61, has served as a director of the Company since 2010 and is currently the chairperson of the audit committee. Ms. Bates currently dedicates her time serving on the boards of directors of several companies primarily in the financial sector. From 1997 to 2012, Ms. Bates was a strategic and financial consultant, principally with respect to corporate finance matters. From 1995 to 1997, Ms. Bates served as Executive Vice President, Chief Financial Officer and Treasurer of NHP, Inc., a national real estate services firm. From 1991 to 1995, Ms. Bates was Vice President and Treasurer of US Airways, and held various finance positions from 1988 to 1991. She currently serves on the board of directors of United Natural Foods, Inc. and is a director or trustee of 19 investment companies in the Franklin Templeton Group of Mutual Funds. She previously served as a director of Allied Capital Corporation from 2003 to 2010, SLM Corporation from 1997 to 2014 and Navient Corporation from 2014 to 2016. Ms. Bates holds a B.B.A in Accountancy from the University of Notre Dame and an M.B.A. in Finance and Economics from Cornell University. We believe that Ms. Bates' experience serving as a director of other public companies in the financial sector, as well as her past experience as a chief financial officer, provides the board of directors and, specifically, the audit committee of the board of directors with valuable knowledge and insight in the financial services sector as well as experience in financial and accounting matters.

               Daniel G. Kelly, Jr. , 67, has served as a director of the Company since May 2016 and currently serves on the nominating and governance committee. Mr. Kelly was a Partner of Davis Polk &

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Wardwell LLP, an international law firm, from 1999 to 2015, co-founding its Silicon Valley office in 1999. During his time at Davis Polk, Mr. Kelly had an extensive corporate practice representing companies, private equity funds and financial institutions in a broad array of complex transactions, and also acted as a senior advisor to boards and special committees on numerous sensitive matters. He currently serves on the board of directors of American Shared Hospital Services, which is a publicly traded healthcare company, and as a Trustee of Choate Rosemary Hall and on the board of directors of Equality Now, a global organization dedicated to creating a world in which women and girls have the same legal rights as men and boys. Prior to joining Davis Polk, Mr. Kelly was a senior officer of a major investment banking firm, the chief legal officer of a New York Stock Exchange ("NYSE") listed corporation and a partner involved in management of two other law firms. Mr. Kelly graduated magna cum laude with a B.A. in History from Yale University and received his J.D. from Columbia University School of Law where he served as Notes and Comments Editor of the Columbia Law Review. We believe that Mr. Kelly's experience practicing as a corporate lawyer, including his substantial experience in providing advice and counsel on corporate governance and securities law matters to numerous public company clients in a wide variety of industries, provides the board of directors with unique insight on its duties and responsibilities.

               Steven B. McKeever , 58, has served as a director of the Company since 2012 and is currently the chairperson of the nominating and governance committee. Mr. McKeever is the CEO of Hidden Beach Recordings, an independent record label based in Los Angeles, California, which Mr. McKeever founded in 1997. From 1991 to 1995, Mr. McKeever was with Motown Records, where he served as Executive Vice President of Talent and Creative Affairs from 1993 to 1995 and Senior Vice President of Artists and Repertoire from 1991 to 1993. In 1992, Mr. McKeever created MoJAZZ Records, a subsidiary of Motown Records and served as its President. In 1993, he was instrumental in the sale of Motown Records to PolyGram Records. Mr. McKeever eventually left Motown Records in 1995 to work on his own entrepreneurial projects. Mr. McKeever began his career at the law firm of Irell & Manella LLP in Los Angeles as an entertainment lawyer. In 2011, Mr. McKeever served as the Executive Producer of Entertainment for the dedication of the Martin Luther King, Jr. Memorial in Washington, D.C. Mr. McKeever currently serves as a director of several organizations, including College Bound (Chairman), African Ancestry.com and The Pacific Institute Spirit Board. He served as a Governor of the Los Angeles Chapter of The National Academy of Recording Arts and Sciences (a/k/a The GRAMMYs) from 2001 to 2003 and 2008 to 2010 and gives generous time to various charitable organizations such as The City of Hope. Mr. McKeever received his B.S. from the University of Illinois at Urbana Champaign and received his J.D. from Harvard Law School. We believe that Mr. McKeever's diversity of experiences, in particular his small business and entrepreneurial experience, provides the board of directors with unique insight and expertise into the management of small and middle-market companies.

               Eric B. Siegel , 61, has served as a director of the Company since 2004 and has been the lead independent director of the board of directors since 2010. Mr. Siegel currently serves on the audit committee and the nominating and governance committee. Since 2005, Mr. Siegel has served as Special Advisor to the Chairman of the Milwaukee Brewers Baseball Club and a member of the Club's Board of Advisors. Mr. Siegel is a director and Chairman of the Executive Committee and Nominating and Governance Committee and member of the Audit Committee and Security Committee of El Paso Electric Company, a NYSE publicly traded utility company. Mr. Siegel is also a past member of the boards of directors of a number of public and private companies, including Kerzner International Ltd. Mr. Siegel is a retired limited partner of Apollo Advisors, L.P. and Lion Advisors, L.P., private investment management firms. Mr. Siegel is a member of the board of directors of the Friends of the Los Angeles Saban Free Clinic and a past member of the Board of Trustees of the Marlborough School. Mr. Siegel holds his B.A. summa cum laude and Phi Beta Kappa and J.D. Order of the Coif from the University of California at Los Angeles. We believe that Mr. Siegel's experience practicing as a corporate lawyer provides valuable insight to the board of directors on regulatory and risk

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management issues and his experience as a partner in investment firms and over 25 years of experience serving as a director for both public and private companies provide industry specific knowledge and expertise to the board of directors.

Interested Directors

               Michael J Arougheti , 46, has served as Co-Chairman of the board of directors since July 2014, as a director of the Company since 2009 and as an Executive Vice President of the Company since October 2014. Mr. Arougheti previously served as Chief Executive Officer of the Company from May 2013 to July 2014, and President of the Company from May 2004 to May 2013. Mr. Arougheti is a Co-Founder and the Chief Executive Officer and President, as well as a Director of Ares. He is a member of the Ares Executive Management Committee, the seven-member governing body which controls Ares and the Management Committee of Ares. In addition, Mr. Arougheti is a member of the Investment Committee of the investment adviser, the Ares Credit Group's U.S. Direct Lending Investment Committee, the Ares Equity Income Opportunity Strategy Portfolio Review Committee and the Management Committee of Ares. Mr. Arougheti may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. From 2001 to 2004, Mr. Arougheti was employed by Royal Bank of Canada, where he was a Managing Partner of the Principal Finance Group of RBC Capital Partners and a member of the firm's Mezzanine Investment Committee. At RBC Capital Partners, Mr. Arougheti oversaw an investment team that originated, managed and monitored a diverse portfolio of middle-market leveraged loans, senior and junior subordinated debt, preferred equity and common stock and warrants on behalf of RBC and other third party institutional investors. Mr. Arougheti joined Royal Bank of Canada in October 2001 from Indosuez Capital, where he was a Principal, responsible for originating, structuring and executing leveraged transactions across a broad range of products and asset classes. Mr. Arougheti also sat on the firm's Investment Committee. Prior to joining Indosuez in 1994, Mr. Arougheti worked at Kidder, Peabody & Co., where he was a member of the firm's Mergers and Acquisitions Group. In addition to serving as chairman of the board of directors of Ares Commercial Real Estate Corporation, Mr. Arougheti also serves on the board of directors of Investor Group Services, Riverspace Arts and Operation HOPE. Mr. Arougheti received a B.A. in Ethics, Politics and Economics, cum laude, from Yale University. We believe that Mr. Arougheti's depth of experience in investment management, leveraged finance and financial services, as well as his intimate knowledge of the Company's business and operations, not only gives the board of directors valuable industry-specific knowledge and expertise on these and other matters but also position him well to continue to serve as Co-Chairman of the board of directors. Mr. Arougheti is an interested director because he is an Executive Vice President of the Company, is a Co-Founder and the Chief Executive Officer and President of Ares, is a member of the Ares Executive Management Committee and serves on the Board of Directors and the Management Committee of Ares.

               R. Kipp deVeer , 46, has served as a director of the Company since 2015 and currently serves as Chief Executive Officer of the Company. Mr. deVeer previously served as President of the Company from May 2013 to July 2014. He joined Ares in May 2004 and currently serves as a Partner of Ares Management Corporation. He is a member of the Ares Executive Management Committee, the seven-member governing body which controls Ares. He is also a Partner in and Head of the Ares Credit Group and a member of the Management Committee of Ares. Mr. deVeer may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. Mr. deVeer is a member of the Investment Committee of our investment adviser, the Ares Credit Group's U.S. and European Direct Lending Investment Committees and other select Ares Credit Group investment committees. Mr. deVeer is also a director of Ares Management Limited, a subsidiary of Ares Management overseeing the European activities of Ares. Prior to joining Ares, Mr. deVeer was a partner at RBC Capital Partners, a division of Royal Bank of Canada, which led the firm's middle market financing and principal investment

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business. Mr. deVeer joined RBC in October 2001 from Indosuez Capital, where he was Vice President in the Merchant Banking Group. Previously, Mr. deVeer worked at J.P. Morgan and Co., both in the Special Investment Group of J.P. Morgan Investment Management, Inc. and the Investment Banking Division of J.P. Morgan Securities Inc. Mr. deVeer received a B.A. from Yale University and an M.B.A. from Stanford University's Graduate School of Business. We believe that Mr. deVeer's depth of experience in investment management, leveraged finance and financial services, as well as his intimate knowledge of our business and operations, gives the board of directors valuable industry specific knowledge and expertise on these and other matters. Mr. deVeer is an interested director because he is the Chief Executive Officer of the Company, a Partner of Ares Management Corporation, an officer of and on the Investment Committee of our investment adviser and a member of the Ares Executive Management Committee and serves on the Management Committee of Ares.

               Robert L. Rosen , 72, has served as a director of the Company since 2004 and was a Partner in the Ares Real Estate Group until 2018. Since February 2018, Mr. Rosen has been party to a strategic advisory agreement with Ares. Mr. Rosen is the Managing Partner of RLR Capital Partners, which invests principally in the securities of publicly traded North American companies. From 2016 to 2018, Mr. Rosen was a Partner of Ares, from 2013 to 2016, Mr. Rosen was an Operating Advisor to the Ares Management Private Equity Group and, from 2010 to 2013, Mr. Rosen was party to a strategic advisory agreement with Ares. From 2005 to 2008, Mr. Rosen was a Managing Partner of RLR Focus Fund LP, an "active value" hedge fund. From 1995 to 2001, Mr. Rosen served as an exclusive consultant to Apollo Management, L.P. In 1998, Mr. Rosen founded National Financial Partners (NYSE: NFP), an independent provider of financial services to high net worth individuals and small to medium sized corporations. He served as NFP's CEO from 1998 to 2000 and as its Chairman until January 2002. From 1987 to 1993, Mr. Rosen was a Managing Partner of Ballantrae Partners, L.P., an investment partnership. From 1989 to 1993, Mr. Rosen was Chairman and CEO of Damon Corporation, a leading healthcare and laboratory testing company that was ultimately sold to Quest Diagnostics. From 1983 to 1987, Mr. Rosen was Vice Chairman of Maxxam Group. Prior to that, Mr. Rosen spent 12 years at Shearson American Express in positions in research, investment banking and senior management, and for two years was Assistant to Sanford Weill, the then Chairman and CEO of Shearson. Mr. Rosen previously served on the boards of directors of Ares Commercial Real Estate Corporation and Sapient Corporation. Mr. Rosen is a member of the Council on Foreign Relations. Mr. Rosen holds a B.A. from the City University of New York in Economics and an M.B.A. from the New York University Leonard N. Stern School of Business in Finance. We believe that Mr. Rosen's over 35 years of experience as a senior executive of financial services, healthcare services and private equity funds brings broad financial industry and specific investment management insight and experience to the board of directors and that his expertise in finance provides valuable knowledge to the board of directors. Mr. Rosen is an interested director because RLR Capital Partners and Mr. Rosen are parties to a strategic advisory agreement with Ares and Mr. Rosen owns certain equity interests in Ares and its affiliates.

               Bennett Rosenthal , 55, has served as Co-Chairman of our board of directors since 2014, and previously as Chairman of our board of directors since 2004. Mr. Rosenthal is a Co-Founder of Ares and a Director and Partner of Ares Management Corporation. He is a member of the Ares Executive Management Committee, the seven-member governing body which controls Ares. He is Co-Head and a Partner in the Ares Private Equity Group and serves as a member of the Board of Directors and Management Committee of Ares. Mr. Rosenthal also is a member of the Investment Committees of certain funds managed by the Ares Private Equity Group. Mr. Rosenthal may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. Mr. Rosenthal joined Ares in 1998 from Merrill Lynch & Co., where he served as a Managing Director in the Global Leveraged Finance Group. Mr. Rosenthal currently serves on the Board of Directors of City Ventures, LLC, Jacuzzi Brands Corporation, and the parent entities of CHG Healthcare Holdings L.P., CPG International Inc., Dawn

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Holdings, Inc., DuPage Medical Group, National Veterinary Associates, Inc., Aspen Dental Management, Inc. and several other private companies. Mr. Rosenthal's previous board of directors experience includes Maidenform Brands, Inc., Hanger, Inc. and Nortek, Inc. Mr. Rosenthal also serves on the Board of Trustees of the Windward School in Los Angeles, and on the Graduate Executive Board of the Wharton School of Business. Mr. Rosenthal graduated summa cum laude with a B.S. in Economics from the University of Pennsylvania's Wharton School of Business where he also received his M.B.A. with distinction. We believe that Mr. Rosenthal's intimate knowledge of the business and operations of Ares, extensive experience in the financial industry as well as the management of private equity and debt investments in particular and experience as a director of other public and private companies not only give the board of directors valuable insight but also position him well to continue to serve as Co-Chairman of the board of directors. Mr. Rosenthal is an interested director because he is a Co-Founder of Ares, Partner of Ares Management Corporation and a member of the Ares Executive Management Committee and serves on the Board of Directors and the Management Committee of Ares.

Executive Officers and Certain Other Officers Who Are Not Directors

               Joshua M. Bloomstein , 45, serves as the General Counsel, Vice President and Secretary of the Company. He joined Ares in November 2006 and currently serves as a Partner and Co General Counsel (Credit) and Deputy General Counsel (Corporate) of Ares Management, and may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. Mr. Bloomstein also currently serves as Vice President and Assistant Secretary of CION Ares Diversified Credit Fund and Vice President and Assistant Secretary of Ares Commercial Real Estate Corporation. Mr. Bloomstein also serves on the Advisory Board of the Naomi Berrie Diabetes Center at Columbia University. Prior to joining Ares, Mr. Bloomstein was an attorney with Latham & Watkins LLP specializing in leveraged buyouts and private equity investments as well as general partnership and corporate matters. Mr. Bloomstein graduated magna cum laude with a B.A. in Political Science from the State University of New York at Albany and received a J.D. degree, magna cum laude, from the University of Miami, where he was elected to the Order of the Coif.

               Mitchell Goldstein , 52, serves as a Co-President of the Company. Mr. Goldstein previously served as an Executive Vice President of the Company from May 2013 to July 2014. He joined Ares in May 2005 and currently serves as a Partner in and Co-Head of the Ares Credit Group, and Vice President of CION Ares Diversified Credit Fund. He is a member of the Management Committee of Ares, and may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. Mr. Goldstein is a member of the Investment Committees of the investment adviser, select Ares Credit Group U.S. Direct Lending investment committees and the Ivy Hill Asset Management Investment Committee and the Ares Commercial Finance Investment Committee. Prior to joining Ares, Mr. Goldstein worked at Credit Suisse First Boston ("CSFB"), where he was a Managing Director in the Financial Sponsors Group. At CSFB, Mr. Goldstein was responsible for providing investment banking services to private equity funds and hedge funds with a focus on M&A and restructurings as well as capital raisings, including high yield, bank debt, mezzanine debt, and IPOs. Mr. Goldstein joined CSFB in 2000 at the completion of the merger with Donaldson, Lufkin & Jenrette. From 1998 to 2000, Mr. Goldstein was at Indosuez Capital, where he was a member of the Investment Committee and a Principal, responsible for originating, structuring and executing leveraged transactions across a broad range of products and asset classes. From 1993 to 1998, Mr. Goldstein worked at Bankers Trust. He also serves on the Board of Managers of Ivy Hill Asset Management GP, LLC, the general partner of Ivy Hill Asset Management L.P. Mr. Goldstein graduated summa cum laude from the State University of New York at Binghamton with a B.S. in Accounting, received an M.B.A. from Columbia University's Graduate School of Business and is a Certified Public Accountant.

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               Miriam Krieger , 42, serves as Vice President of the Company. Ms. Krieger previously served as Chief Compliance Officer of the Company from June 2011 to April 2019. She joined Ares in April 2010 and is a Partner and Global Chief Compliance Officer of Ares, as well as Ares' Global Anti-Money Laundering Officer and Global Anti-Corruption Officer and is a member of the Ares Operations Management Group and the Management Committee of Ares. She also serves as the Chief Compliance Officer of Ivy Hill Asset Management, L.P. She may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. From March 2008 until joining Ares, Ms. Krieger was Chief Compliance Officer and Corporate Secretary of Allied Capital Corporation, where she also served as Executive Vice President from August 2008 until April 2010 and as Senior Vice President from March 2008 to August 2008. Ms. Krieger also served as Senior Vice President and Chief Compliance Officer at MCG Capital Corporation, a publicly traded business development company, from 2006 to 2008 and Vice President and Assistant General Counsel from 2004 to 2006. From 2001 to 2004, Ms. Krieger was an associate in the Financial Services Group of the law firm of Sutherland Asbill & Brennan LLP. Ms. Krieger graduated with a B.A. in Economics and Political Science from Wellesley College and received a J.D. and an M.A. in Economics from Duke University.

               Scott C. Lem , 41, serves as Chief Accounting Officer, Vice President and Treasurer of the Company. Mr. Lem previously served as Assistant Treasurer of the Company from May 2009 to May 2013. Mr. Lem also currently serves as Chief Financial Officer of Ares Dynamic Credit Allocation Fund, Inc. (NYSE:ARDC) and Chief Financial Officer of CION Ares Diversified Credit Fund. He is a Partner and Chief Accounting Officer, Credit (Direct Lending) in the Ares Finance Department. He may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. From July 2003 to December 2008, Mr. Lem served as Controller of Ares Management. Prior to joining Ares in July 2003, Mr. Lem was with Ernst & Young LLP and Arthur Andersen LLP, most recently as a Senior Associate conducting audits for clients across several industries including entertainment, hospitality and real estate. Mr. Lem graduated summa cum laude with a B.S. in Accounting from the University of Southern California's Leventhal School of Accounting and summa cum laude with a B.S. in Business Administration from the University of Southern California's Marshall School of Business. Mr. Lem has also received an M.B.A. in Finance from UCLA's Anderson School of Management. Mr. Lem is a Certified Public Accountant (Inactive).

               Lisa A. Morgan , 43, serves as the Chief Compliance Officer of the Company. She joined Ares Management in September 2017 as Managing Director and Head of Regulatory Compliance in the Ares Compliance Group. Prior to joining Ares Management in 2017, Ms. Morgan was a Partner in the Business Practices Group at Eversheds Sutherland (US) LLP, where she focused on the formation, regulation and operation of public and private funds, including business development companies. Ms. Morgan began her legal career at Eversheds Sutherland (US) LLP in 2003. Ms. Morgan holds a B.A. from Providence College in Sociology and Spanish, and a J.D. from the University of North Carolina at Chapel Hill.

               Penni F. Roll , 53, serves as the Chief Financial Officer of the Company. She joined Ares Management in 2010 and now serves as a Partner and Chief Financial Officer of the Ares Credit Group, and is a member of the Management Committee of Ares. She also serves as the Treasurer of Ares Dynamic Credit Allocation Fund (NYSE:ARDC) and CION Ares Diversified Credit Fund. Ms. Roll is also Chief Financial Officer, Vice President and Treasurer of IHAM and Chief Financial Officer of Ivy Hill Asset Management GP, LLC, IHAM's General Partner, where she also serves on the Board of Managers. She may additionally from time to time serve as an officer, director or principal of other entities affiliated with Ares Management or of other investment funds managed by Ares Management and its affiliates. Ms. Roll also serves as a member of the Ares Inclusion and Diversity Council. Prior to joining Ares Management, Ms. Roll served as Chief Financial Officer of Allied

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Capital Corporation from 1998 until April 2010. Ms. Roll joined Allied Capital Corporation in 1995 as its Controller after serving as a Manager in KPMG LLP's financial services practice. Ms. Roll graduated magna cum laude with a B.S.B.A. in Accounting from West Virginia University.

               Michael L. Smith , 48, serves as a Co-President of the Company. Mr. Smith previously served as an Executive Vice President of the Company from May 2013 to July 2014. Mr. Smith joined Ares in May 2004 and currently serves as a Partner in and Co-Head of the Ares Credit Group and a member of the Management Committee of Ares. From time to time, he may serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. Mr. Smith is a member of the Investment Committees of our investment adviser, select Ares Credit Group U.S. Direct Lending investment committees and Commercial Finance Investment Committee, the Ares Private Equity Group's Special Opportunities Investment Committee, the Infrastructure and Power Group Funds Investment Committee, the Ivy Hill Asset Management Investment Committee and other select Ares Credit Group Investment Committees. Prior to joining Ares, Mr. Smith was a Partner at RBC Capital Partners, a division of Royal Bank of Canada, which led the firm's middle market financing and principal investment business. Mr. Smith joined RBC in October 2001 from Indosuez Capital, where he was a Vice President in the Merchant Banking Group. Previously, Mr. Smith worked at Kenter, Glastris & Company, and at Salomon Brothers Inc., in their Debt Capital Markets Group and Financial Institutions Group. Mr. Smith received a B.S. in Business Administration, cum laude, from the University of Notre Dame and a Masters in Management from Northwestern University's Kellogg Graduate School of Management.

               Michael D. Weiner , 66, serves as a Vice President of the Company. Mr. Weiner serves as Executive Vice President and Chief Legal Officer of Ares Management Corporation, a Partner and Co-General Counsel in the Ares Legal Group and Global Privacy Officer and a member of the Management Committee of Ares. He may from time to time serve as an officer, director or principal of entities affiliated with Ares Management or of investment funds managed by Ares Management and its affiliates. Mr. Weiner has also served as Vice President and General Counsel of Ares Commercial Real Estate Corporation since 2012, Vice President and Assistant Secretary of Ares Dynamic Credit Allocation Fund, Inc. and Vice President and Assistant Secretary of CION Ares Diversified Credit Fund. From September 2006 to January 2010, Mr. Weiner served as General Counsel of the Company. He additionally is a member of the Ares Operations Management Group and the Ares Enterprise Risk Committee. Mr. Weiner joined Ares in September 2006. Previously, Mr. Weiner served as General Counsel to Apollo Management, L.P. and had been an officer of the corporate general partners of Apollo since 1992. Prior to joining Apollo, Mr. Weiner was a partner in the law firm of Morgan, Lewis & Bockius specializing in corporate and alternative financing transactions, securities law as well as general partnership, corporate and regulatory matters. Mr. Weiner has served on the boards of directors of several corporations. Mr. Weiner currently serves on the Board of Governors of the Cedars Sinai Medical Center in Los Angeles. Mr. Weiner graduated with a B.S. in Business and Finance from the University of California at Berkeley and a J.D. from the University of Santa Clara.

BOARD LEADERSHIP STRUCTURE

              Our board of directors monitors and performs an oversight role with respect to the business and affairs of the Company, including with respect to investment practices and performance, compliance with regulatory requirements and the services, expenses and performance of service providers to the Company. Among other things, our board of directors approves the appointment of our investment adviser, administrator and officers, reviews and monitors the services and activities performed by our investment adviser, administrator and officers and approves the engagement, and reviews the performance of, our independent registered public accounting firm.

              Under the Company's bylaws, our board of directors may designate a chairman to preside over the meetings of the board of directors and meetings of the stockholders and to perform such other

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duties as may be assigned to him by the board of directors. We do not have a fixed policy as to whether the chairman of the board of directors should be an independent director and believe that our flexibility to select our chairman and reorganize our leadership structure from time to time is in the best interests of the Company and its stockholders.

              Presently, Mr. Arougheti and Mr. Rosenthal serve as co-chairs of our board of directors. Mr. Arougheti is an interested director because he is an Executive Vice President of the Company, is a Co-Founder and the Chief Executive Officer and President of Ares, is a member of the Ares Executive Management Committee and serves on the Board of Directors and the Management Committee of Ares. The Company believes that Mr. Arougheti's depth of experience in investment management, leveraged finance and financial services, as well as his intimate knowledge of the Company's business and operations, gives our board of directors valuable industry-specific knowledge and expertise on these and other matters. Mr. Rosenthal is an interested director because he is a Co-Founder of Ares, Partner of Ares and a member of the Ares Executive Management Committee and serves on the Board of Directors and the Management Committee of Ares. The Company believes that Mr. Rosenthal's history with the Company, familiarity with the Ares investment platform and extensive experience in the management of private equity and debt investments qualifies him to serve as co-chairman of our board of directors. Moreover, we believe that we are best served through our existing leadership structure with Mr. Arougheti and Mr. Rosenthal as co-chairs of our board of directors, as Mr. Arougheti and Mr. Rosenthal's relationships with our investment adviser provide an effective bridge between our board of directors and our investment adviser, thus ensuring an open dialogue between our board of directors and our investment adviser and that both groups act with a common purpose.

              The independent directors have designated a lead independent director whose duties include, among other things, chairing executive sessions of the independent directors, acting as a liaison between the independent directors and the co-chairs of the board of directors and between the independent directors and officers of the Company and our investment adviser, facilitating communication among the independent directors and the Company's counsel, reviewing and commenting on board of director and committee meeting agendas and calling additional meetings of the independent directors as appropriate. In August 2010, the board of directors designated and appointed Mr. Siegel as the lead independent director and Mr. Siegel has served as lead independent director since that time.

              We believe that board leadership structures must be evaluated on a case-by-case basis and that our existing board leadership structure is appropriate. However, we continually re-examine our corporate governance policies on an ongoing basis to ensure that they continue to meet the Company's needs.

BOARD'S ROLE IN RISK OVERSIGHT

              Our board of directors performs its risk oversight function and fulfills its risk oversight responsibilities primarily (1) through its three standing committees, which report to the entire board of directors and are comprised solely of independent directors and (2) by working with our Chief Compliance Officer to monitor risk in accordance with our compliance policies and procedures.

              As described below in more detail under "Committees of the Board of Directors," the audit committee and the nominating and governance committee assist the board of directors in performing its risk oversight function and fulfilling its risk oversight responsibilities. The audit committee's risk oversight responsibilities include overseeing the Company's accounting and financial reporting processes, assisting the board of directors in fulfilling its oversight responsibilities relating to the Company's systems of internal controls over financial reporting, audits of the Company's financial statements and disclosure controls and procedures, assisting the board of directors in determining the fair value of securities that are not publicly traded or for which current market values are not readily

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available, and discussing with management the Company's major financial risk exposures and the steps management has taken to monitor and control such exposures, including the Company's risk assessment and risk management policies. The nominating and governance committee's risk oversight responsibilities include developing, reviewing and updating certain policies regarding the nomination of directors, identifying, evaluating and nominating directors to fill vacancies on the board of directors or to stand for election by our stockholders, reviewing the Company's policies relating to corporate governance, and overseeing the evaluation of our board of directors and its committees.

              Our board of directors also performs its risk oversight function and fulfills its risk oversight responsibilities by working with our Chief Compliance Officer to monitor risk in accordance with the Company's policies and procedures. Our Chief Compliance Officer prepares a written report annually discussing the adequacy and effectiveness of the compliance policies and procedures of the Company and certain of its service providers. Our Chief Compliance Officer's report, which is reviewed by and discussed with our board of directors, addresses at a minimum (1) the operation of the compliance policies and procedures of the Company and certain of its service providers since the last report; (2) any material changes to such policies and procedures since the last report; (3) any recommendations for material changes to such policies and procedures as a result of our Chief Compliance Officer's annual review; and (4) any compliance matter that has occurred since the date of the last report about which our board of directors would reasonably need to know to oversee the Company's compliance activities and risks. In addition, our Chief Compliance Officer reports to our board of directors on a quarterly basis with respect to material compliance matters and meets separately in executive session with the independent directors periodically, but in no event less than once each year.

              We believe that our board of directors' role in risk oversight is effective and appropriate given the extensive regulation to which we are already subject as a BDC. Specifically, as a BDC we must comply with certain regulatory requirements and restrictions that control the levels of risk in our business and operations. For example, our ability to incur indebtedness is currently limited such that our asset coverage must equal at least 200% immediately after each time we incur indebtedness (though effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us)), we generally have to invest at least 70% of our total assets in "qualifying assets" and, subject to certain exceptions, we are subject to restrictions on our ability to engage in transactions with Ares and its affiliates. See "Regulation." In addition, we have elected to be treated as a RIC under the Code. As a RIC we must, among other things, meet certain source of income and asset diversification requirements. See "Certain Material U.S. Federal Income Tax Considerations."

              We believe that the extent of our board of directors' (and its committees') role in risk oversight complements our board of directors' leadership structure because it allows our independent directors, through the three fully independent board committees, a lead independent director, executive sessions with each of our Chief Compliance Officer, our independent registered public accounting firm and independent valuation providers and otherwise, to exercise oversight of risk without any conflict that might discourage critical review.

              We believe that our board of directors' role in risk oversight must be evaluated on a case-by-case basis and that our board of directors' existing role in risk oversight is appropriate. However, our board of directors re-examines the manner in which it administers its risk oversight function on an ongoing basis to ensure that it continues to meet the Company's needs.

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COMMITTEES OF THE BOARD OF DIRECTORS

              Our board of directors has established an audit committee, a nominating and governance committee and a co-investment committee. We do not have a compensation committee because our executive officers do not receive any direct compensation from us. During 2018, the board of directors held 14 formal meetings, the audit committee held five formal meetings, the nominating and governance committee held three formal meetings, and the co-investment committee held 24 formal meetings. We encourage, but do not require, the directors to attend our annual meeting of stockholders in person.

Audit Committee

              The members of the audit committee are Ms. Bates and Messrs. Bartlett and Siegel, each of whom is independent for purposes of the Investment Company Act and The NASDAQ Global Select Market's corporate governance regulations. Ms. Bates currently serves as chairperson of the audit committee.

              The role of the audit committee is to assist our board of directors in fulfilling its oversight responsibilities by: (1) overseeing the Company's accounting and financial reporting processes and the audits of the Company's financial statements and internal control over financial reporting and (2) reviewing the financial reports and other financial information provided by the Company to the public. The audit committee is also responsible for approving our independent registered public accounting firm and recommending them to our board of directors (including a majority of the independent directors) for approval and submission to our stockholders for ratification, reviewing with our independent registered public accounting firm the plans and results of the audit engagement, approving professional services provided by our independent registered public accounting firm, reviewing the independence of our independent registered public accounting firm and reviewing the adequacy of our internal controls and procedures.

              The audit committee also assists our board of directors in determining the fair value of debt and equity securities that are not publicly traded or for which current market values are not readily available, and in connection therewith recommends valuation policies to the board of directors, considers valuation issues with respect to liquid securities and reviews valuations of illiquid securities proposed by the investment adviser. The audit committee also receives input from independent valuation firms that have been engaged at the direction of the board of directors to value certain portfolio investments. In addition, the audit committee is responsible for discussing with the Company's officers and management of our investment adviser the Company's major financial risk exposures and the steps that the Company has taken to monitor and control such exposures, including the Company's risk assessment and risk management policies. The audit committee also reviews and approves all transactions with related persons of the Company that are brought to the audit committee's attention, including each annual renewal of our investment advisory and management agreement and our administration agreement.

              This description of the audit committee's role and responsibilities is summary in nature, is not exhaustive and is qualified in its entirety by reference to the charter of the audit committee, which can be accessed via the Company's website at www.arescapitalcorp.com . The contents of the Company's website are not incorporated by reference into this prospectus or the accompanying prospectus supplement, and any references to the Company's website are intended to be inactive textual references only.

              Our board of directors has determined that Ms. Bates is an "audit committee financial expert" within the meaning of the rules of the SEC.

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Nominating and Governance Committee

              The members of the nominating and governance committee are Messrs. Kelly, McKeever and Siegel, each of whom is independent for purposes of the Investment Company Act and The NASDAQ Global Select Market's corporate governance regulations. Mr. McKeever currently serves as chairman of the nominating and governance committee. The nominating and governance committee is responsible for (1) developing, reviewing and, as appropriate, updating certain policies regarding the nomination of directors and recommending such policies or any changes in such policies to the board of directors for approval, (2) identifying individuals qualified to become directors, (3) evaluating and recommending to the board of directors nominees to fill vacancies on the board of directors or committees thereof or to stand for election by the stockholders of the Company, (4) reviewing the Company's policies relating to corporate governance at least annually and recommending any changes in such policies to the board of directors, and (5) overseeing the evaluation of the board of directors (including its leadership structure) and its committees.

              In considering possible candidates for election as a director, the nominating and governance committee takes into account, in addition to such other factors as it deems relevant, the desirability of selecting directors who:

    are of high character and integrity;

    are accomplished in their respective fields, with superior credentials and recognition;

    have relevant expertise and experience upon which to be able to offer advice and guidance to the Company's officers and management of the investment adviser and the administrator;

    have sufficient time available to devote to the affairs of the Company;

    are able to work with the other members of the board of directors and contribute to the success of the Company;

    can represent the long-term interests of the Company's stockholders as a whole; and

    are selected such that the board of directors represents a range of backgrounds and experience.

              The nominating and governance committee also considers all applicable legal and regulatory requirements that govern the composition of the board of directors.

              The nominating and governance committee may consider recommendations for nomination of directors from our stockholders when such recommendations are submitted in accordance with our bylaws and any applicable law, rule or regulation regarding director nominations. Nominations made by stockholders must be delivered to or mailed (setting forth the information required by our bylaws) and received at our principal executive offices not earlier than the 150th day and not later than 5:00 p.m., New York time, on the 120th day prior to the first anniversary of the date on which we first mailed our proxy materials for the previous year's annual meeting of stockholders; provided , however , that if the date of the annual meeting has changed by more than 30 days from the first anniversary of the date of the prior year's annual meeting, the nomination must be received not earlier than the 150th day prior to the date of such annual meeting and not later than 5:00 p.m., New York time, on the later of (1) the 120th day prior to the date of such annual meeting, as originally convened, or (2) the 10th day following the day on which public announcement of such meeting date is first made.

              This description of the nominating and governance committee's role and responsibilities is summary in nature, is not exhaustive and is qualified in its entirety by reference to the charter of the nominating and governance committee, which can be accessed via the Company's website at www.arescapitalcorp.com . The contents of the Company's website are not intended to be incorporated

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by reference into this prospectus or the accompanying prospectus supplement, and any references to the Company's website are intended to be inactive textual references only.

Compensation Committee

              The role of the compensation committee is performed by the audit committee, which is comprised entirely of independent directors for purposes of the NASDAQ corporate governance requirements and rules and regulations of the SEC, including the compensation committee requirements of NASDAQ Marketplace Rule 5605(d) and Rule 5605(a)(2). The Company's executive officers do not receive any direct compensation from us. The audit committee charter contains all of the provisions that a compensation committee charter would be required to include under the NASDAQ corporate governance listing requirements and the rules and regulations of the SEC. In addition, pursuant to the audit committee charter, the amounts payable to our investment adviser and our administrator pursuant to our investment advisory and management agreement and administration agreement, respectively, are separately approved by the audit committee. The compensation payable to our investment adviser pursuant to the investment advisory and management agreement is also separately approved by a majority of our independent directors in accordance with Section 15(c) of the Investment Company Act.

              The specific responsibilities of the audit committee, including those related to compensation, are set forth in the charter of the audit committee, which can be accessed via the Company's website at www.arescapitalcorp.com . The contents of the Company's website are not intended to be incorporated by reference into this prospectus or the accompanying prospectus supplement, and any references to the Company's website are intended to be inactive textual references only.

Co-Investment Committee

              The members of the co-investment committee are Ms. Bates and Messrs. Bartlett, Kelly, McKeever and Siegel, each of whom is independent for purposes of the Investment Company Act and The NASDAQ Global Select Market's corporate governance regulations. The co-investment committee is primarily responsible for reviewing and making certain findings in respect of co-investment transactions pursuant to the Co-investment Exemptive Order the Company received from the Commission on January 18, 2017.

BENEFICIAL OWNERSHIP OF OUR DIRECTORS

              The following table sets forth the dollar range of our equity securities based on the closing price of our common stock on May 16, 2019 and the number of shares beneficially owned by each of

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our directors as of December 31, 2018. We are not part of a "family of investment companies," as that term is defined in the Investment Company Act.

Name of Director
  Dollar Range of Equity
Securities in the
Company(1)(2)

Independent Directors(3)

   

Steve Bartlett(4)

  Over $100,000

Ann Torre Bates

  Over $100,000

Daniel G. Kelly, Jr. 

  Over $100,000

Steven B. McKeever

  Over $100,000

Eric B. Siegel

  Over $100,000

Interested Directors

   

Michael J Arougheti

  Over $100,000

R. Kipp deVeer(5)

  Over $100,000

Robert L. Rosen

  Over $100,000

Bennett Rosenthal

  Over $100,000

(1)
The dollar ranges are as follows: none, $1-$10,000, $10,001-$50,000, $50,001-$100,000 or over $100,000.

(2)
Beneficial ownership determined in accordance with Rule 16a-1(a)(2) under the Exchange Act.

(3)
As of December 31, 2018, to the best of our knowledge, except as listed above, none of the independent directors, nor any of their immediate family members, had any interest in us, our investment adviser or any person or entity directly or indirectly controlling, controlled by or under common control with us or our investment adviser.

(4)
The shares of our common stock held by Mr. Bartlett have been pledged as security in connection with a line of credit with a third party financial institution unaffiliated with the Company.

(5)
The shares of the Company's common stock held by Mr. deVeer have been pledged as security in connection with a line of credit with a third party financial institution unaffiliated with the Company.

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COMPENSATION TABLE

              The following table shows information regarding the compensation earned or actually received by our directors, none of whom is our employee, for services as a director for the fiscal year ended December 31, 2018. No compensation is paid by us to interested directors. No information has been provided with respect to our executive officers who are not directors since our executive officers do not receive any direct compensation from us.

Name
  Fees Earned or
Paid in
Cash(1)
  Total  

Independent Directors

             

Steve Bartlett

  $ 221,000   $ 221,000  

Ann Torre Bates

  $ 231,500   $ 231,500  

Daniel G. Kelly, Jr. 

  $ 221,000   $ 221,000  

Steven B. McKeever

  $ 223,000   $ 223,000  

Eric B. Siegel

  $ 242,000   $ 242,000  

Interested Directors

             

Michael J Arougheti(2)

    None     None  

R. Kipp deVeer(2)

    None     None  

Robert L. Rosen(3)

    None     None  

Bennett Rosenthal(2)

    None     None  

(1)
For a discussion of the independent directors' compensation, see below.

(2)
Each of Messrs. Arougheti, deVeer and Rosenthal is compensated by Ares Management and its affiliates in connection with his services as an officer, partner, director and/or principal of Ares Management, entities affiliated with Ares Management and of investment funds managed by Ares Management and its affiliates. Such director's compensation arrangement with Ares Management and its affiliates existed prior to his service as a director of the Company.

(3)
Mr. Rosen was compensated by Ares Management and its affiliates in connection with his services as an officer, director and/or principal of entities affiliated with Ares Management and of investment funds managed by Ares Management and its affiliates for the fiscal year ended December 31, 2018. However, under such compensation arrangement, Mr. Rosen did not receive any compensation or other payment from Ares Management or any of its affiliates in connection with his service as a director of the Company.

              For the fiscal year ended December 31, 2018, the independent directors received an annual fee of $160,000. They also received $2,500 plus reimbursement of reasonable out-of-pocket expenses incurred in connection with attending each board meeting and received $1,000 plus reimbursement of reasonable out-of-pocket expenses incurred in connection with attending each committee meeting. In addition, the chairperson of the audit committee received an additional annual fee of $10,000, the lead independent director received an additional annual fee of $15,000, and each chairperson of any other committee received an additional annual fee of $2,000 for his or her additional services in these capacities. In addition, we purchased directors' and officers' liability insurance on behalf of our directors and officers.

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              In October 2018, while evaluating our Board compensation program for 2019, the nominating and governance committee engaged Meridian Compensation Partners, LLC ("Meridian"), a nationally recognized compensation consulting firm, to undertake a review of our Board compensation program. In February 2019, Meridian met with the nominating and governance committee to provide recommendations regarding our Board compensation program for 2019. Following a recommendation from the nominating and governance committee, the Board approved an increase in the annual fees payable to our independent directors for service as members of the Board, effective as of January 1, 2019, taking into account Meridian's recommendations. As a result of this increase, effective as of January 1, 2019, our independent directors receive an annual fee of $200,000, the chairperson of the audit committee receives an additional annual fee of $25,000, the chairperson of the nominating and governance committee receives an additional annual fee of $10,000 and the lead independent director receives an additional annual fee of $35,000. Our directors also receive $2,500 plus reimbursement of reasonable out-of-pocket expenses incurred in connection with attending each board meeting and receive $1,000 plus reimbursement of reasonable out-of-pocket expenses incurred in connection with attending each committee meeting.

PORTFOLIO MANAGERS

              We consider the members of the Investment Committee of Ares Capital Management to be our portfolio managers. The following individuals function as portfolio managers primarily responsible for the day-to-day management of our portfolio.

Name
  Position   Length of
Service with
Ares (years)
  Principal Occupation(s) During Past 5 Years

Mark Affolter

  Partner and Portfolio Manager of the Ares Credit Group     11   Mr. Affolter is a Partner and Portfolio Manager in the Ares Credit Group, Central Region Head for U.S. Direct Lending and a member of the Management Committee of Ares. Additionally, Mr. Affolter serves as a member of the Ares Credit Group's U.S. Direct Lending Investment Committee.

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Name
  Position   Length of
Service with
Ares (years)
  Principal Occupation(s) During Past 5 Years

Michael J Arougheti

 

Co-Chairman of the board of directors of the Company; Executive Vice President of the Company

    15  

Since October 2014, Mr. Arougheti has served as an Executive Vice President of the Company, since July 2014, he has served as Co-Chairman of the Company's board of directors and since February 2009, he has served as a director of the Company. Mr. Arougheti previously served as Chief Executive Officer of the Company from May 2013 to July 2014 and President of the Company from May 2004 to May 2013. Mr. Arougheti is a Co-Founder and the Chief Executive Officer and President of Ares and is a member of the Ares Executive Management Committee. He is also a member of the Board of Directors and Management Committee of Ares. Mr. Arougheti is a member of the Investment Committee of the Ares Credit Group's U.S. Direct Lending Investment Committees, the Ares Equity Income Opportunity Strategy Portfolio Review Committee and the Ares Operations Management Group.

R. Kipp deVeer

 

Chief Executive Officer of the Company; Partner in and Head of the Ares Credit Group

   
15
 

Since July 2014, Mr. deVeer has served as Chief Executive Officer of the Company. Mr. deVeer previously served as President of the Company from May 2013 to July 2014. Mr. deVeer joined Ares in May 2004 and currently serves as a Partner of Ares Management Corporation and is a member of the Ares Executive Management Committee. He is a Partner in and Head of the Ares Credit Group and also a member of the Management Committee of Ares. Mr. deVeer is a member of the Investment Committees of Ares Capital Management and the Ares Credit Group's U.S. and European Direct Lending Investment Committees. Mr. deVeer is also a director of Ares Management Limited, a subsidiary of Ares overseeing the European activities of Ares.

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Name
  Position   Length of
Service with
Ares (years)
  Principal Occupation(s) During Past 5 Years

Mitchell Goldstein

 

Co-President of the Company; Partner in and Co-Head of the Ares Credit Group

    15  

Since July 2014, Mr. Goldstein has served as a Co-President of the Company. Mr. Goldstein previously served as an Executive Vice President of the Company from May 2013 to July 2014. Mr. Goldstein has served as an officer of Ares Capital Management since 2005. Mr. Goldstein joined Ares in May 2005 and currently serves as a Partner of the Ares Credit Group. Mr. Goldstein also serves as a Vice President of CION Ares Diversified Credit Fund. Mr. Goldstein is a member of the Investment Committees of Ares Capital Management, the Ares Credit Group's U.S. Direct Lending and Commercial Finance Investment Committees and the Ivy Hill Asset Management Investment Committee, and is a member of the Management Committee of Ares.

Jim Miller

 

Partner and Portfolio Manager of the Ares Credit Group

   
13
 

Mr. Miller is a Partner and Portfolio Manager in the Ares Credit Group, as well as the East Region Co-Head for U.S. Direct Lending and a member of the Management Committee of Ares. Additionally, Mr. Miller serves on the Ares Credit Group's U.S. Direct Lending and Commercial Finance Investment Committees.

Kort Schnabel

 

Partner and Portfolio Manager of the Ares Credit Group

   
18
 

Mr. Schnabel is a Partner and Portfolio Manager in the Ares Credit Group, as well as the West Region Head for U.S. Direct Lending and a member of the Management Committee of Ares. Additionally, Mr. Schnabel serves on Ares Credit Group's U.S. Direct Lending Investment Committee.

David Schwartz

 

Partner and Portfolio Manager of the Ares Credit Group

   
15
 

Mr. Schwartz is a Partner and Portfolio Manager in the Ares Credit Group, East Region Co-Head for U.S. Direct Lending and a member of the Management Committee of Ares. Additionally, Mr. Schwartz serves as a member of the Ares Credit Group's U.S. Direct Lending Investment Committee.

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Name
  Position   Length of
Service with
Ares (years)
  Principal Occupation(s) During Past 5 Years

Michael L. Smith

 

Co-President of the Company; Partner in and Co-Head of the Ares Credit Group

    15  

Since July 2014, Mr. Smith has served as a Co-President of the Company. Mr. Smith previously served as an Executive Vice President of the Company from May 2013 to July 2014. Mr. Smith has served as an officer of Ares Capital Management since 2004. Mr. Smith joined Ares in May 2004 and currently serves as a Partner of the Ares Credit Group. Mr. Smith is a member of the Investment Committees of Ares Capital Management, the Ares Credit Group's U.S. Direct Lending Investment Committee, the Ivy Hill Asset Management Investment Committee, the Ares Commercial Finance Investment Committee and the Management Committee of Ares.

              None of the individuals listed above is primarily responsible for the day-to-day management of the portfolio of any other account, except that Messrs. Affolter, deVeer, Goldstein, Miller, Schnabel, Schwartz and Smith are each Partners of the Ares Credit Group. All such individuals have responsibilities with respect to certain funds and managed accounts, which as of March 31, 2019 had approximately $101.1 billion (including the Company) of assets under management, a portion of which is used to calculate Ares' advisory fees related to such funds and managed accounts. See "Risk Factors—Risks Relating to Our Business—There are significant potential conflicts of interest that could impact our investment returns."

              Each of Messrs. Affolter, Arougheti, deVeer, Goldstein, Miller, Schnabel, Schwartz and Smith is responsible for deal origination, execution and portfolio management. In addition to their deal origination, execution and portfolio management responsibilities, (1) Mr. Arougheti also spends a portion of his time on corporate and administrative activities in his capacity as Chief Executive Officer and President of Ares Management, (2) Mr. deVeer also spends a portion of his time on corporate and administrative activities in his capacity as the Company's Chief Executive Officer and as a Partner in and Head of the Ares Credit Group, (3) Messrs. Goldstein and Smith also spend portions of their time on corporate and administrative activities in their capacities as Co-Presidents of the Company and as Partners of the Ares Credit Group and (4) Messrs. Affolter, Miller, Schnabel and Schwartz are each a Partner in the Ares Credit Group. Each of Messrs. Affolter, Arougheti, deVeer, Goldstein, Miller, Schnabel, Schwartz and Smith receives a compensation package that includes some combination of fixed draw and variable incentive compensation based on our performance. None of the portfolio managers receives any direct compensation from us.

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              The following table sets forth the dollar range of our equity securities based on the closing price of our common stock on May 16, 2019 and the number of shares beneficially owned by each of the portfolio managers described above as of December 31, 2018 unless otherwise indicated below.

Name
  Aggregate Dollar Range
of Equity Securities in
Ares Capital(1)

Mark Affolter

  None

Michael J Arougheti

  Over $1,000,000

R. Kipp deVeer

  Over $1,000,000

Mitchell Goldstein

  Over $1,000,000

Jim Miller

  $100,001-$500,000

Kort Schnabel

  None

David Schwartz

  $10,001-$50,000

Michael L. Smith

  Over $1,000,000

(1)
Dollar ranges are as follows: none, $1-$10,000, $10,001-$50,000, $50,001-$100,000, $100,001-$500,000, $500,001-$1,000,000 or over $1,000,000.

INVESTMENT ADVISORY AND MANAGEMENT AGREEMENT

Management Services

              Ares Capital Management serves as our investment adviser and is registered as an investment adviser under the Advisers Act. Subject to the overall supervision of our board of directors, our investment adviser manages the day-to-day operations of, and provides investment advisory and management services to, Ares Capital. Under the terms of the investment advisory and management agreement, our investment adviser:

    determines the composition of our portfolio, the nature and timing of the changes to our portfolio and the manner of implementing such changes;

    identifies, evaluates and negotiates the structure of the investments we make (including performing due diligence on our prospective portfolio companies);

    closes and monitors the investments we make;

    determines the investments and other assets that we purchase, retain or sell; and

    provides us with such other investment advisory and research and related services as we may from time to time reasonably require.

              Ares Capital Management's services to us under the investment advisory and management agreement are not exclusive, and it is free to furnish similar services to other entities. Similarly, our investment adviser or its affiliates may directly or indirectly manage funds or other investment vehicles with investment objectives similar to ours. Accordingly, we may compete with these Ares funds or other investment vehicles managed by our investment adviser and its affiliates for capital and investment opportunities. Ares Capital Management endeavors to allocate investment opportunities in a fair and equitable manner, and in any event consistent with any fiduciary duties owed to Ares Capital. Nevertheless, it is possible that we may not be given the opportunity to participate in certain investments made by investment funds or other investment vehicles managed by our investment adviser or its affiliates. See "Risk Factors—Risks Relating to Our Business—There are significant potential conflicts of interest that could impact our investment returns."

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Base Management Fee

              Pursuant to the investment advisory and management agreement and subject to the overall supervision of our board of directors, our investment adviser provides investment advisory and management services to us. For providing these services, our investment adviser receives fees from us consisting of a base management fee, an income based fee and a capital gains incentive fee.

              The base management fee is currently calculated at an annual rate of 1.5% based on the average value of our total assets (other than cash or cash equivalents but including assets purchased with borrowed funds) at the end of the two most recently completed calendar quarters. The base management fee is payable quarterly in arrears. Effective June 6, 2019, the base management fee will be calculated at an annual rate of 1.5% based on the average value of our total assets (other than than cash or cash equivalents but including assets purchased with borrowed funds) at the end of the two most recently completed calendar quarters; provided, however, the base management fee will be calculated at an annual rate of 1.0% on the average value of our total assets (other than than cash or cash equivalents but including assets purchased with borrowed funds) that exceeds the product of (A) 200% and (B) our net asset value at the end of the most recently completed calendar quarter.

Income Based Fee

              The income based fee is calculated and payable quarterly in arrears based on our net investment income excluding income based fees and capital gains incentive fees ("pre-incentive fee net investment income") for the quarter. Pre-incentive fee net investment income means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring, diligence and consulting fees or other fees that we receive from portfolio companies but excluding fees for providing managerial assistance) accrued during the calendar quarter, minus operating expenses for the quarter (including the base management fee, any expenses payable under the administration agreement, and any interest expense and dividends paid on any outstanding preferred stock, but excluding the income based fee and capital gains incentive fee accrued under GAAP). Pre-incentive fee net investment income includes, in the case of investments with a deferred interest feature such as market discount, debt instruments with PIK interest, preferred stock with PIK dividends and zero coupon securities, accrued income that we have not yet received in cash. Our investment adviser is not under any obligation to reimburse us for any part of the income based fees it received that were based on accrued interest that we never actually received. See "Risk Factors—Risks Relating to Our Business—There are significant potential conflicts of interest that could impact our investment returns" and "Risk Factors—Risks Relating to Our Business—We may be obligated to pay our investment adviser certain fees even if we incur a loss."

              Pre-incentive fee net investment income does not include any realized capital gains, realized capital losses, unrealized capital appreciation, unrealized capital depreciation or income tax expense related to realized gains and losses. Because of the structure of the income based fee, it is possible that we may pay such fees in a quarter where we incur a loss. For example, if we receive pre-incentive fee net investment income in excess of the hurdle rate for a quarter, we will pay the applicable income based fee even if we have incurred a loss in that quarter due to realized and/or unrealized capital losses.

              Pre-incentive fee net investment income, expressed as a rate of return on the value of our net assets (defined as total assets less indebtedness and before taking into account any income based fees and capital gains incentive fees payable during the period) at the end of the immediately preceding calendar quarter, is compared to a fixed "hurdle rate" of 1.75% per quarter. If market credit spreads rise, we may be able to invest our funds in debt instruments that provide for a higher return, which may increase our pre-incentive fee net investment income and make it easier for our investment adviser to surpass the fixed hurdle rate and receive an income based fee based on such net investment income.

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To the extent we have retained pre-incentive fee net investment income that has been used to calculate the income based fee, it is also included in the amount of our total assets (other than cash and cash equivalents but including assets purchased with borrowed funds) used to calculate the base management fee.

              We pay our investment adviser an income based fee with respect to our pre-incentive fee net investment income in each calendar quarter as follows:

    No income based fee in any calendar quarter in which our pre-incentive fee net investment income does not exceed the hurdle rate;

    100% of our pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 2.1875% in any calendar quarter. We refer to this portion of our pre-incentive fee net investment income (which exceeds the hurdle rate but is less than 2.1875%) as the "catch-up" provision. The "catch-up" is meant to provide our investment adviser with 20% of the pre-incentive fee net investment income as if a hurdle rate did not apply if this net investment income exceeded 2.1875% in any calendar quarter; and 20% of the amount of our pre-incentive fee net investment income, if any, that exceeds 2.1875% in any calendar quarter.

              The following is a graphical representation of the calculation of the income based fee:

Quarterly Income Based Fee Based on Net Investment Income

Pre-incentive fee net investment income return
(expressed as a percentage of the value of net assets)

GRAPHIC

Percentage of pre-incentive fee net investment income
allocated to income based fee

              These calculations are adjusted for any share issuances or repurchases during the quarter.

              In connection with the American Capital Acquisition, our investment adviser has agreed to waive, for each of the first ten calendar quarters beginning with the second calendar quarter of 2017 and ending with the third calendar quarter of 2019, the lesser of (1) $10 million of income based fees and (2) the amount of income based fees for such quarter, in each case, to the extent payable by us in such quarter pursuant to and as calculated under the investment advisory and management agreement.

Capital Gains Incentive Fee

              The capital gains incentive fee is determined and payable in arrears as of the end of each calendar year (or, upon termination of our investment advisory and management agreement, as of the termination date) and is calculated at the end of each applicable year by subtracting (1) the sum of our cumulative aggregate realized capital losses and aggregate unrealized capital depreciation from (2) our cumulative aggregate realized capital gains, in each case calculated from October 8, 2004 (the date we completed our IPO). Realized capital gains and losses include gains and losses on investments and foreign currencies, gains and losses on extinguishment of debt and from other assets, as well as any

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income tax and other expenses related to net realized gains and losses. If such amount is positive at the end of such year, then the capital gains incentive fee for such year is equal to 20% of such amount, less the aggregate amount of capital gains incentive fees paid in all prior years. If such amount is negative, then there is no capital gains incentive fee for such year.

              The cumulative aggregate realized capital gains are calculated as the sum of the differences, if positive, between (1) the net sales price of each investment in our portfolio when sold and (2) the accreted or amortized cost basis of such investment.

              The cumulative aggregate realized capital losses are calculated as the sum of the amounts by which (1) the net sales price of each investment in our portfolio when sold is less than (2) the accreted or amortized cost basis of such investment.

              The aggregate unrealized capital depreciation is calculated as the sum of the differences, if negative, between (1) the valuation of each investment in our portfolio as of the applicable capital gains incentive fee calculation date and (2) the accreted or amortized cost basis of such investment.

              Notwithstanding the foregoing, as a result of an amendment to the capital gains incentive fee under the investment advisory and management agreement that was adopted on June 6, 2011, if we are required by GAAP to record an investment at its fair value as of the time of acquisition instead of at the actual amount paid for such investment by us (including, for example, as a result of the application of the asset acquisition method of accounting), then solely for the purposes of calculating the capital gains incentive fee, the "accreted or amortized cost basis" of an investment shall be an amount (the "Contractual Cost Basis") equal to (1) (A) the actual amount paid by us for such investment plus (B) any amounts recorded in our financial statements as required by GAAP that are attributable to the accretion of such investment plus (C) any other adjustments made to the cost basis included in our financial statements, including PIK interest or additional amounts funded (net of repayments) minus (2) any amounts recorded in our financial statements as required by GAAP that are attributable to the amortization of such investment, whether such calculated Contractual Cost Basis is higher or lower than the fair value of such investment (as determined in accordance with GAAP) at the time of acquisition.

              We defer cash payment of any income based fee and the capital gains incentive fee otherwise earned by our investment adviser if during the most recent four full calendar quarter period ending on or prior to the date such payment is to be made the sum of (1) the aggregate distributions to our stockholders and (2) the change in net assets (defined as total assets less indebtedness and before taking into account any income based fees and capital gains incentive fees payable during the period) is less than 7.0% of our net assets (defined as total assets less indebtedness) at the beginning of such period. Any deferred income based fees and capital gains incentive fees are carried over for payment in subsequent calculation periods to the extent such payment is payable under our investment advisory and management agreement.

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Examples of Fee Calculation

Example 1—Income Based Fee(1):

Assumptions

    •    Hurdle rate(2) = 1.75%    
    •    Management fee(3) = 0.375%    
    •    Other expenses (legal, accounting, custodian, transfer agent, etc.)(4) = 0.20%    
    •    All assets financed using leverage equal to or under 1.0x debt to equity.    

(1)
The hypothetical amount of pre-incentive fee net investment income shown is based on a percentage of total net assets. In addition, the example assumes that during the most recent four full calendar quarter period ending on or prior to the date the payment set forth in the example is to be made, the sum of (1) our aggregate distributions to our stockholders and (2) our change in net assets (defined as total assets less indebtedness and before taking into account any income based fees or capital gains incentive fees accrued during the period) is at least 7% of our net assets (defined as total assets less indebtedness) at the beginning of such period (as adjusted for any share issuances or repurchases).

(2)
Represents a quarter of the 7.0% annualized hurdle rate.

(3)
Represents a quarter of the 1.5% annualized management fee.

(4)
Excludes offering expenses.

Alternative 1

Additional Assumptions

    •    Investment income (including interest, dividends, fees, etc.) = 1.25%    
    •    Pre-incentive fee net investment income
            (investment income – (management fee + other expenses)) = 0.675%
   
    Pre-incentive fee net investment income does not exceed the hurdle rate,
therefore there is no income based fee.
   

Alternative 2

Additional Assumptions

    •    Investment income (including interest, dividends, fees, etc.) = 2.70%    
    •    Pre-incentive fee net investment income
            (investment income – (management fee + other expenses)) = 2.125%
   
    Pre-incentive fee net investment income exceeds hurdle rate, therefore there is an income based fee.    
    Income Based Fee   =   100% × "Catch-Up" + the greater of 0% AND (20% × (pre-incentive fee net investment income – 2.1875%))    
        =   (100% × (2.125% – 1.75%)) + 0%    
        =   100% × 0.375%    
        =   0.375%    

Alternative 3

Additional Assumptions

    •    Investment income (including interest, dividends, fees, etc.) = 3.50%    
    •    Pre-incentive fee net investment income
            (investment income – (management fee + other expenses)) = 2.925%
   
    Pre-incentive fee net investment income exceeds hurdle rate, therefore there is an income based fee.    
    Income Based Fee   =   100% × "Catch-Up" + the greater of 0% AND (20% × (pre-incentive fee net investment income – 2.1875%))    
        =   (100% × (2.1875% – 1.75%)) + (20% × (2.925% – 2.1875%))    
        =   0.4375% + (20% × 0.7375%)    
        =   0.4375% + 0.1475%    
        =   0.585%    

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Example 2—Capital Gains Incentive Fee:

Alternative 1:

Assumptions

    Year 1: $20 million investment made in Company A ("Investment A"), and $30 million investment made in Company B ("Investment B")
    Year 2: Investment A is sold for $50 million and fair value ("FV") of Investment B determined to be $32 million
    Year 3: FV of Investment B determined to be $25 million
    Year 4: Investment B sold for $31 million

The capital gains incentive fee, if any, would be:

    Year 1: None (No sales transactions)
    Year 2: $6 million (20% multiplied by $30 million realized capital gains on sale of Investment A)
    Year 3: None; $5 million (20% multiplied by ($30 million realized cumulative capital gains less $5 million cumulative capital depreciation)) less $6 million (previous capital gains incentive fee paid in Year 2)
    Year 4: $200,000; $6.2 million (20% multiplied by $31 million cumulative realized capital gains) less $6 million (capital gains incentive fee paid in Year 2)

Alternative 2

Assumptions

    Year 1: $20 million investment made in Company A ("Investment A"), $30 million investment made in Company B ("Investment B") and $25 million investment made in Company C ("Investment C")
    Year 2: Investment A sold for $50 million, FV of Investment B determined to be $25 million and FV of Investment C determined to be $25 million
    Year 3: FV of Investment B determined to be $27 million and Investment C sold for $30 million
    Year 4: FV of Investment B determined to be $35 million
    Year 5: Investment B sold for $20 million

The capital gains incentive fee, if any, would be:

    Year 1: None (No sales transactions)
    Year 2: $5 million (20% multiplied by $25 million ($30 million realized capital gains on Investment A less $5 million unrealized capital depreciation on Investment B))
    Year 3: $1.4 million ($6.4 million (20% multiplied by $32 million ($35 million cumulative realized capital gains less $3 million unrealized capital depreciation)) less $5 million (capital gains incentive fee paid in Year 2))
    Year 4: None (No sales transactions)
    Year 5: None ($5 million (20% multiplied by $25 million (cumulative realized capital gains of $35 million less realized capital losses of $10 million)) less $6.4 million (cumulative capital gains incentive fee paid in Year 2 and Year 3))

              For the three months ended March 31, 2019, we incurred $49 million in base management fees and $38 million in income based fees. The income based fees for the three months ended March 31, 2019 were net of the Fee Waiver of $10 million. There was no capital gains incentive fee earned by our investment adviser as calculated under the investment advisory and management agreement for the three months ended March 31, 2019. However, in accordance with GAAP, the Company had cumulatively accrued a capital gains incentive fee of $64 million as of March 31, 2019, none of which was due under the investment advisory and management agreement.

              For the year ended December 31, 2018, we incurred $180 million in base management fees and $129 million in income based fees. The income based fees for year ended December 31, 2018 were net of the Fee Waiver of $40 million. The capital gains incentive fee payable to our investment adviser as

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calculated under the investment advisory and management agreement for the year ended December 31, 2018 was $50 million. In accordance with GAAP, the Company had cumulatively accrued a capital gains incentive fee of $112 million as of December 31, 2018, $62 million of which was not due under the investment advisory and management agreement.

              For the year ended December 31, 2017, we incurred $171 million in base management fees, and $134 million in income based fees. The income based fees for the year ended December 31, 2017 were net of the Fee Waiver of $30 million. There was no capital gains incentive fee earned by our investment adviser as calculated under the investment advisory and management agreement for the year ended December 31, 2017. However, in accordance with GAAP, the Company has cumulatively accrued a capital gains incentive fee of $79 million as of December 31, 2017, none of which was due under the investment advisory and management agreement.

              For the year ended December 31, 2016, we incurred $137 million in base management fees, and $123 million in income based fees. There was no capital gains incentive fee earned by our investment adviser as calculated under the investment advisory and management agreement for the year ended December 31, 2016. However, in accordance with GAAP, the Company has cumulatively accrued a capital gains incentive fee of $38 million as of December 31, 2016, none of which was due under the investment advisory and management agreement.

              GAAP requires that the capital gains incentive fee accrual consider the cumulative aggregate unrealized capital appreciation in the calculation, as a capital gains incentive fee would be payable if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the investment advisory and management agreement. This GAAP accrual is calculated using the aggregate cumulative realized capital gains and losses and aggregate cumulative unrealized capital depreciation included in the calculation of the capital gains incentive fee actually payable under the investment advisory and management agreement plus the aggregate cumulative unrealized capital appreciation, net of any expense associated with cumulative unrealized capital depreciation or appreciation. If such amount is positive at the end of a period, then GAAP requires the Company to record a capital gains incentive fee equal to 20% of such cumulative amount, less the aggregate amount of actual capital gains incentive fees paid or capital gains incentive fees accrued under GAAP in all prior periods. As of March 31, 2019, the Company has paid capital gains incentive fees since inception totaling $108 million. The resulting accrual for any capital gains incentive fee under GAAP in a given period may result in an additional expense if such cumulative amount is greater than in the prior period or a reversal of previously recorded expense if such cumulative amount is less than in the prior period. If such cumulative amount is negative, then there is no accrual. There can be no assurance that such unrealized capital appreciation will be realized in the future.

Payment of Our Expenses

              The services of all investment professionals and staff of our investment adviser, when and to the extent engaged in providing investment advisory and management services to us and routine overhead expenses of such personnel allocable to such services, are provided and paid for by our investment adviser. Under the investment advisory and management agreement, we bear all other costs and expenses of our operations and transactions, including, but not limited to, those relating to: organization; calculation of our net asset value (including, but not limited to, the cost and expenses of any independent valuation firm); expenses incurred by our investment adviser payable to third parties, including agents, consultants or other advisers, in monitoring our financial and legal affairs and in monitoring our investments (including the cost of consultants hired to develop information technology systems designed to monitor our investments) and performing due diligence on our prospective portfolio companies; interest payable on indebtedness, if any, incurred to finance our investments (including payments to third party vendors for financial information services); offerings of our common

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stock and other securities; investment advisory and management fees; administration fees; fees payable to third parties, including agents, consultants or other advisers, relating to, or associated with, evaluating and making investments in portfolio companies, regardless of whether such transactions are ultimately consummated; transfer agent and custodial fees; registration fees; listing fees; taxes; independent directors' fees and expenses; costs of preparing and filing reports or other documents with the SEC; the costs of any reports, proxy statements or other notices to stockholders, including printing costs; to the extent we are covered by any joint insurance policies, our allocable portion of the insurance premiums for such policies; direct costs and expenses of administration, including auditor and legal costs; and all other expenses incurred by us or our administrator in connection with administering our business as described in more detail under "—Administration Agreement" below.

Duration, Termination and Amendment

              At an in-person meeting of our board of directors on March 16, 2011, the form of our current investment advisory and management agreement, including two proposed amendments to our then existing investment advisory and management agreement, was approved by our board of directors with the recommendation that our stockholders vote to approve the proposed amendments. On June 6, 2011, our stockholders approved the proposed amendments, and we entered into a restated investment advisory and management agreement, reflecting such amendments on June 6, 2011. At an in-person meeting of our board of directors on April 24, 2019, our board of directors, including a majority of the directors who are not "interested persons" of the Company as defined in the Investment Company Act, voted to approve the Second Amended and Restated Advisory and Management Agreement and the continuation of the Second Amended and Restated Advisory and Management Agreement to June 6, 2020. A discussion regarding the basis for our board of directors' approval of the 2011 adoption of the form of our current investment advisory and management agreement is available in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

              Unless terminated earlier, the investment advisory and management agreement will automatically renew for successive annual periods if approved annually by our board of directors or by the affirmative vote of the holders of a majority of our outstanding voting securities, and, in either case, approval by a majority of our directors who are not "interested persons" of the Company (as defined in the Investment Company Act). The investment advisory and management agreement will automatically terminate in the event of its assignment (as defined in the Investment Company Act). The investment advisory and management agreement may be terminated by either party without penalty upon 60 days' written notice to the other party.

              Conflicts of interest may arise if our investment adviser seeks to change the terms of our investment advisory and management agreement, including, for example, the amount of the base management fee, the income based fee, the capital gains incentive fee or other compensation terms. Material amendments to our investment advisory and management agreement must be approved by the affirmative vote of the holders of a majority of our outstanding voting securities and by a majority of our independent directors, and we may from time to time decide it is appropriate to seek the requisite approval to change the terms of the agreement.

              Effective June 6, 2019, the base management fee will be calculated at an annual rate of 1.5% based on the average value of our total assets (other than than cash or cash equivalents but including assets purchased with borrowed funds) at the end of the two most recently completed calendar quarters; provided, however, the base management fee will be calculated at an annual rate of 1.0% on the average value of our total assets (other than than cash or cash equivalents but including assets purchased with borrowed funds) that exceeds the product of (A) 200% and (B) our net asset value at the end of the most recently completed calendar quarter.

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Indemnification

              The investment advisory and management agreement provides that, absent willful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of the reckless disregard of its duties and obligations, our investment adviser, its members and their respective officers, managers, partners, agents, employees, controlling persons and members and any other persons affiliated with it are entitled to indemnification from us for any damages, liabilities, costs and expenses (including reasonable attorneys' fees and amounts reasonably paid in settlement) arising from the rendering of our investment adviser's services under the investment advisory and management agreement or otherwise as our investment adviser.

Organization of our Investment Adviser

              Our investment adviser is a Delaware limited liability company that is registered as an investment adviser under the Advisers Act. The principal executive offices of Ares Capital Management are located at 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067.

ADMINISTRATION AGREEMENT

              We are also party to an administration agreement with Ares Operations, an affiliate of our investment adviser and a subsidiary of Ares Management. Our board of directors approved the continuation of our administration agreement on April 24, 2019, which extended the term of the agreement until June 1, 2020. Pursuant to the administration agreement, Ares Operations furnishes us with office equipment and clerical, bookkeeping and record keeping services at our office facilities. Under the administration agreement, Ares Operations also performs, or oversees the performance of, our required administrative services, which include, among other things, providing assistance in accounting, legal, compliance, operations, technology and investor relations, being responsible for the financial records that we are required to maintain and preparing reports to our stockholders and reports filed with the SEC. In addition, Ares Operations assists us in determining and publishing our net asset value, assists us in providing managerial assistance to our portfolio companies, oversees the preparation and filing of our tax returns and the printing and dissemination of reports to our stockholders, and generally oversees the payment of our expenses and the performance of administrative and professional services rendered to us by others. Payments under the administration agreement are equal to an amount based upon our allocable portion of Ares Operations' overhead and other expenses (including travel expenses) incurred by Ares Operations in performing its obligations under the administration agreement, including our allocable portion of the compensation, rent and other expenses of certain of our officers (including our chief compliance officer, chief financial officer, chief accounting officer, general counsel, secretary, treasurer and assistant treasurer) and their respective staffs. The administration agreement may be terminated by either party without penalty upon 60 days' written notice to the other party.

              For the three months ended March 31, 2019, the Company incurred $4 million in administrative fees, all of which were unpaid and included in "accounts payable and other liabilities" in the accompanying March 31, 2019 consolidated balance sheet. For each of the years ended December 31, 2018, 2017 and 2016, we incurred $13 million, $12 million and $14 million, respectively, in administrative fees. As of December 31, 2018 and 2017, $3 million and $4 million of the administrative fees were unpaid and included in "accounts payable and other liabilities" in the accompanying December 31, 2018 and 2017 consolidated balance sheets, respectively. In addition, for the year ended December 31, 2017, we incurred an additional $8 million in administrative fees related to the integration of the American Capital Acquisition. These acquisition-related expenses are included in "professional fees and other costs related to the American Capital Acquisition" in the consolidated statement of operations.

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Indemnification

              The administration agreement provides that, absent willful misfeasance, bad faith or negligence in the performance of its duties or by reason of the reckless disregard of its duties and obligations, Ares Operations, its members and their respective officers, managers, partners, agents, employees, controlling persons and members and any other persons or entities affiliated with it are entitled to indemnification from us for any damages, liabilities, costs and expenses (including reasonable attorneys' fees and amounts reasonably paid in settlement) arising from the rendering of Ares Operations' services under the administration agreement or otherwise as our administrator.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

              We have procedures in place for the review, approval and monitoring of transactions involving us and certain persons related to us. For example, we have a code of conduct that generally prohibits any of our officers or directors from engaging in any transaction where there is a conflict between such individual's personal interest and our interests. Waivers to the code of conduct can generally only be obtained from the Chief Compliance Officer, the co-chairs of the board of directors or the chairperson of the audit committee and are publicly disclosed as required by applicable law and regulations. In addition, the audit committee is required to review and approve all related-party transactions (as defined in Item 404 of Regulation S-K, as promulgated under the Securities Act).

              As a BDC, we are also subject to certain regulatory requirements that restrict our ability to engage in certain related-party transactions. We have separate policies and procedures that have been adopted to ensure that we do not enter into any such prohibited transactions without seeking necessary approvals.

              We are party to an investment advisory and management agreement with Ares Capital Management, a subsidiary of Ares Management, an entity in which certain of our directors and officers and members of the investment committee of our investment adviser may have indirect ownership and pecuniary interests. Certain of our directors and officers and members of the investment committee of our investment adviser also serve as officers or principals of other investment managers affiliated with Ares Management that currently, and may in the future, manage investment funds with investment objectives similar to our investment objective. In addition, certain of our directors and officers and members of the investment committee of our investment adviser serve or may serve as officers, directors or principals of entities that operate in the same or related line of business as we do or of investment funds managed by our affiliates. Accordingly, we may not be made aware of and/or be given the opportunity to participate in certain investments made by investment funds managed by advisers affiliated with Ares Management. However, our investment adviser intends to allocate investment opportunities in a fair and equitable manner in accordance with our investment adviser's investment allocation policy. See "Risk Factors—Risks Relating to Our Business—There are significant potential conflicts of interest that could impact our investment returns."

              In connection with the American Capital Acquisition, our investment adviser has agreed to waive, for each of the first ten calendar quarters beginning with the second quarter of 2017 and ending with the third quarter of 2019, the lesser of (i) $10 million of income based fees and (ii) the amount of income based fees for such quarter, in each case, to the extent payable by us in such quarter pursuant to and as calculated under the investment advisory and management agreement.

              Pursuant to the terms of the administration agreement between Ares Operations and us, Ares Operations, a subsidiary of Ares Management, currently provides us with certain administrative and other services necessary to conduct our day-to-day operations, and we reimburse Ares Operations, at cost, for our allocable portion of overhead and other expenses (including travel expenses) incurred by Ares Operations in performing its obligations under our administration agreement, including our allocable portion of the compensation, rent and other expenses of certain of our officers (including our chief compliance officer, chief financial officer, chief accounting officer, general counsel, secretary, treasurer and assistant treasurer) and their respective staffs, but not investment professionals.

              Our portfolio company, IHAM, is party to an administration agreement with Ares Operations, pursuant to which Ares Operations provides IHAM with, among other things, office facilities, equipment, clerical, bookkeeping and record keeping services, services relating to the marketing and sale of interests in vehicles managed by IHAM, services of, and oversight of, custodians, depositories, accountants, attorneys, underwriters and such other persons in any other capacity deemed to be necessary. Under the IHAM administration agreement, IHAM reimburses Ares Operations for all of the actual costs associated with such services, including its allocable portion of the compensation, rent

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and other expenses of its overhead and the cost of Ares Operations' officers and respective staff in performing its obligations under the IHAM administration agreement.

              We are party to office leases pursuant to which we are leasing office facilities from third parties. For certain of these office leases, we had also entered into separate subleases with Ares Management LLC, the sole member of the investment adviser, and IHAM, pursuant to which Ares Management LLC and IHAM subleased office space from us. In October 2018, we terminated all of our existing office space subleases with Ares Management LLC and IHAM. We then entered into a new sublease solely with Ares Management LLC, whereby Ares Management LLC subleased the full amount of certain of our office leases.

              Prior to April 1, 2018, Ares Management LLC was also a party to separate subleases with us, pursuant to which we subleased certain office leases from Ares Management LLC. These subleases are no longer in place.

              We have entered into agreements with Ares Management LLC and IHAM, pursuant to which Ares Management LLC and IHAM are entitled to use our proprietary portfolio management software. For the fiscal year ended December 31, 2018, amounts payable by Ares Management LLC and IHAM to us under these agreements totaled $0 million.

              We have also entered into a license agreement with Ares Management LLC pursuant to which Ares Management LLC has granted us a non-exclusive, royalty-free license to use the name "Ares." Under this agreement, we will have a right to use the Ares name for so long as Ares Capital Management remains our investment adviser. Other than with respect to this limited license, we have no legal right to the "Ares" name.

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CONTROL PERSONS AND PRINCIPAL STOCKHOLDERS

              To our knowledge, as of May 16, 2019, there were no persons that owned 25% or more of our outstanding voting securities and no person would be deemed to control us, as such term is defined in the Investment Company Act.

              The following table sets forth, as of May 16, 2019 (unless otherwise noted), the number of shares of our common stock beneficially owned by each of our current directors and named executive officers, all directors, executive officers and certain other officers as a group and certain beneficial owners, according to information furnished to us by such persons or publicly available filings.

              Beneficial ownership is determined in accordance with the rules of the SEC and includes voting or investment power with respect to the securities. Ownership information for those persons who beneficially own 5% or more of the outstanding shares of our common stock is based upon Schedule 13D, Schedule 13G, Form 13F or other filings by such persons with the SEC and other information obtained from such persons. To our knowledge, as of May 16, 2019, there were no persons that owned 5% or more of the outstanding shares of our common stock. Except as otherwise noted below, each person named in the following table has sole voting and investment power with respect to all shares of our common stock that he or she beneficially owns.

              The address for Messrs. Arougheti, Bloomstein, deVeer, Goldstein, Rosen and Smith, Ms. Roll and certain other officers is c/o Ares Capital Corporation, 245 Park Avenue, 44th Floor, New York, New York 10167. The address for Mmes. Krieger and Morgan is 1001 19th Street North, Suite 1200, Arlington, Virginia 22209. The address for each of the other directors, executive officers and certain other officers is c/o Ares Capital Corporation, 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067.

Name of Beneficial Owner
  Amount and
Nature of
Beneficial
Ownership
  Percent of
Class(1)
 

Directors and Named Executive Officers:

             

Interested Directors

             

Michael J Arougheti

    1,106,416     *  

R. Kipp deVeer

    225,000 (2)   *  

Robert L. Rosen

    38,006     *  

Bennett Rosenthal

    255,138 (3)   *  

Independent Directors

             

Steve Bartlett

    11,600 (4)   *  

Ann Torre Bates

    32,000 (5)   *  

Daniel G. Kelly, Jr. 

    19,445     *  

Steven B. McKeever

    13,730     *  

Eric B. Siegel

    46,942 (6)   *  

Named Executive Officers Who Are Not Directors

             

Mitchell Goldstein

    243,611 (7)   *  

Michael L. Smith

    151,012     *  

Penni F. Roll

    67,452 (8)   *  

All Directors, Executive Officers and Certain Other Officers as a Group (17 persons)

    2,298,224 (9)   *  

*
Represents less than 1%.

(1)
Based on 426,298,200 shares of common stock outstanding as of May 16, 2019.

(2)
The shares of our common stock held by Mr. deVeer have been pledged as security in connection with a line of credit with a third party financial institution unaffiliated with us.

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(3)
Consists of 255,138 shares of common stock indirectly beneficially owned by Mr. Rosenthal through BAR Holdings, LLC of which Mr. Rosenthal is the manager.

(4)
The shares of our common stock held by Mr. Bartlett have been pledged as security in connection with a line of credit with a third party financial institution unaffiliated with us.

(5)
Consists of (i) 24,000 shares of common stock owned directly; and (ii) 8,000 shares of common stock indirectly beneficially owned by Ms. Bates through her spouse.

(6)
Consists of (i) 36,704 shares of common stock owned directly; (ii) 8,166 shares of common stock indirectly beneficially owned by Mr. Siegel through his spouse; and (iii) 2,072 shares of common stock indirectly beneficially owned by Mr. Siegel as a custodian for the account of one of his children. Mr. Siegel has shared voting and investment authority with respect to shares held by his spouse. Mr. Siegel disclaims beneficial ownership of the 2,072 shares of common stock indirectly beneficially owned by Mr. Siegel as a custodian for the account of one of his children, except to the extent of his pecuniary interest therein.

(7)
139,869 shares of our common stock held by Mr. Goldstein have been pledged as security in connection with margin trading accounts.

(8)
Consists of (i) 11,147 shares of common stock owned directly; and (ii) 56,305 shares of common stock indirectly beneficially owned by Ms. Roll through a trust for the benefit of Ms. Roll, her spouse and her children.

(9)
Includes shares owned by our officers that are not "Named Executive Officers," as defined in Item 402 of Regulation S-K, as promulgated under the Securities Act.

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DETERMINATION OF NET ASSET VALUE

              The net asset value per share of our outstanding shares of common stock is determined quarterly by dividing the value of total assets minus liabilities by the total number of shares outstanding.

              Investments for which market quotations are readily available are typically valued at such market quotations. In order to validate market quotations, we look at a number of factors to determine if the quotations are representative of fair value, including the source and nature of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available ( i.e. , substantially all of our investments) are valued at fair value as determined in good faith by our board of directors, based on, among other things, the input of our investment adviser, audit committee and independent third-party valuation firms that have been engaged at the direction of our board of directors to assist in the valuation of each portfolio investment without a readily available market quotation at least once during a trailing 12-month period (with certain de minimis exceptions) and under a valuation policy and a consistently applied valuation process. We follow ASC 820-10, which expands the application of fair value accounting for investments (see Note 8 to the consolidated financial statements for the year ended December 31, 2018). ASC 820-10 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosure of fair value measurements. ASC 820-10 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date. The valuation process is conducted at the end of each fiscal quarter, and a portion of the Company's investment portfolio at fair value is subject to review by an independent valuation firm each quarter. In addition, our independent registered public accounting firm obtains an understanding of, and performs select procedures relating to, our investment valuation process within the context of performing the integrated audit.

              As part of the valuation process, we may take into account the following types of factors, if relevant, in determining the fair value of our investments: the enterprise value of a portfolio company (the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time), the nature and realizable value of any collateral, the portfolio company's ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company's securities to similar publicly traded securities, changes in the interest rate environment and the credit markets, which may affect the price at which similar investments would trade in their principal markets and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate our valuation.

              Because there is not a readily available market value for most of the investments in our portfolio, we value substantially all of our portfolio investments at fair value as determined in good faith by our board of directors, as described herein. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of our investments may fluctuate from period to period. Additionally, the fair value of our investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that we may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we may realize significantly less than the value at which we have previously recorded it.

              In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected in the valuations currently assigned.

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              Our board of directors undertakes a multi-step valuation process each quarter, as described below:

    Our quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals responsible for the portfolio investment in conjunction with our portfolio management team.

    Preliminary valuations are reviewed and discussed with our investment adviser's management and investment professionals, and then valuation recommendations are presented to the board of directors.

    The audit committee of our board of directors reviews these valuations, as well as the input of third parties, including independent third-party valuation firms who have reviewed a portion of the investments in the Company's portfolio at fair value.

    The board of directors discusses valuations and ultimately determines the fair value of each investment in our portfolio without a readily available market quotation in good faith based on, among other things, the input of our investment adviser, audit committee and, where applicable, independent third-party valuation firms.

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DIVIDEND REINVESTMENT PLAN

              We have adopted a dividend reinvestment plan that provides for reinvestment of any distributions we declare in cash on behalf of our stockholders, unless a stockholder elects to receive cash as provided below. As a result, if our board of directors authorizes, and we declare, a cash dividend, then our stockholders who have not "opted out" of our dividend reinvestment plan will have their cash dividends automatically reinvested in additional shares of our common stock, rather than receiving the cash dividends.

              No action is required on the part of a registered stockholder to have their cash dividend reinvested in shares of our common stock. A registered stockholder may elect to receive an entire cash dividend in cash by notifying Computershare Trust Company, N.A. ("Computershare"), the plan administrator and our transfer agent and registrar, in writing so that such notice is received by the plan administrator no later than the record date fixed by the board of directors for dividends to stockholders. The plan administrator will set up an account for shares acquired through the dividend reinvestment plan for each stockholder who has not elected to receive dividends in cash and hold such shares in non-certificated form. Upon request by a stockholder participating in the dividend reinvestment plan, received in writing no later than 10 days prior to the record date, the plan administrator will, instead of crediting fractional shares to the participant's account, issue a check for any fractional share.

              Those stockholders whose shares are held by a broker or other financial intermediary may receive dividends in cash by notifying their broker or another financial intermediary of their election.

              To implement the dividend reinvestment plan, we may use newly issued shares or we may purchase shares in the open market, in each case to the extent permitted under applicable law, whether our shares are trading at, above or below net asset value. If newly issued shares are used to implement the dividend reinvestment plan, the number of shares to be issued to a stockholder shall be determined by dividing the total dollar amount of the dividend payable to such stockholder by the market price per share of our common stock at the close of regular trading on The NASDAQ Global Select Market on the dividend payment date. Market price per share on that date shall be the closing price for such shares on The NASDAQ Global Select Market or, if no sale is reported for such day, at the average of their reported bid and asked prices. If shares are purchased in the open market to implement the dividend reinvestment plan, the number of shares to be issued to a stockholder shall be determined by dividing the dollar amount of the cash dividend payable to such stockholder by the weighted average price per share for all shares purchased by the plan administrator in the open market in connection with the dividend. The number of shares of our common stock to be outstanding after giving effect to payment of the dividend cannot be established until the value per share at which additional shares will be issued has been determined and elections of our stockholders have been tabulated.

              There are no brokerage charges or other charges to stockholders who participate in the dividend reinvestment plan. The plan administrator's fees under the plan are paid by us. If a participant elects by notice to the plan administrator in advance of termination to have the plan administrator sell part or all of the shares held by the plan administrator in the participant's account and remit the proceeds to the participant, the plan administrator is authorized to deduct a transaction fee of up to $15 plus a $0.12 per share fee from the proceeds.

              Stockholders whose cash dividends are reinvested in shares of our common stock are subject to the same U.S. federal, state and local tax consequences as are stockholders who elect to receive their dividends in cash. A stockholder's initial basis for determining gain or loss upon the sale of stock received in a dividend from us will be equal to the total dollar amount of the dividend payable to the stockholder. Any stock received on reinvestment of a cash dividend will have a new holding period for tax purposes commencing on the day following the day on which the shares are credited to the U.S. stockholder's account. See "Certain Material U.S. Federal Income Tax Considerations."

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              Participants may terminate their accounts under the dividend reinvestment plan by notifying the plan administrator via its website at www.computershare.com/investor , by filling out the transaction request form located at bottom of their statement and sending it to the plan administrator at P.O. Box 505000, Louisville, KY 40233-5000 or by calling the plan administrator's hotline at 1-866-365-2497.

              The dividend reinvestment plan may be terminated by us upon notice in writing mailed to each participant at least 30 days prior to any record date for the payment of any dividend by us. All correspondence concerning the dividend reinvestment plan should be directed to the plan administrator via the Internet at www.computershare.com/investor , by mail at P.O. Box 505000, Louisville, KY 40233-5000 or by telephone at 1-866-365- 2497.

              Additional information about the dividend reinvestment plan may be obtained by contacting the plan administrator via the Internet at www.computershare.com/investor , by mail at P.O. Box 505000, Louisville, KY 40233-5000 or by telephone at 1-866-365- 2497.

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CERTAIN MATERIAL U.S. FEDERAL INCOME TAX CONSIDERATIONS

              The following discussion is a general summary of certain material U.S. federal income tax considerations relating to the acquisition, ownership, and disposition of shares of our preferred stock or common stock and our qualification and taxation as a RIC for U.S. federal income tax purposes. This discussion does not purport to be a complete description of all of the tax considerations relating thereto. In particular, we have not described certain considerations that may be relevant to certain types of stockholders subject to special treatment under U.S. federal income tax laws, including stockholders subject to the alternative minimum tax, tax-exempt organizations, insurance companies, stockholders that are treated as partnerships for U.S. federal income tax purposes, dealers in securities, traders in securities that elect to use a mark-to-market method of accounting for securities holdings, pension plans and trusts, financial institutions, a person that holds shares in our preferred stock or common stock as part of a straddle or a hedging or conversion transaction, real estate investment trusts ("REITs"), RICs, U.S. stockholders (as defined below) whose functional currency is not the U.S. dollar, non-U.S. stockholders (as defined below) engaged in a trade or business in the United States, persons who have ceased to be U.S. citizens or to be taxed as residents of the United States, "controlled foreign corporations," and passive foreign investment companies ("PFICs"). This summary is limited to stockholders that hold our preferred stock or common stock as capital assets (within the meaning of the Code), and does not address owners of a stockholder. This discussion is based upon the Code, its legislative history, existing and proposed U.S. Treasury regulations, published rulings and court decisions, each as of the date of this prospectus and all of which are subject to change, possibly retroactively, which could affect the continuing validity of this discussion. We have not sought and will not seek any ruling from the Internal Revenue Service (the "IRS") regarding the offerings pursuant to this prospectus or pursuant to the accompanying prospectus supplement unless expressly stated therein. This summary does not discuss any aspects of U.S. estate or gift tax or foreign, state or local tax. It does not discuss the special treatment under U.S. federal income tax laws that could result if we invest in tax-exempt securities or certain other investment assets. It also does not discuss the tax aspects of common or preferred stock sold in units with the other securities being registered.

              If we issue preferred stock that may be convertible into or exercisable or exchangeable for securities or other property or preferred stock with other terms that may have different U.S. federal income tax consequences than those described in this summary, the U.S. federal income tax consequences of that preferred stock will be described in the relevant prospectus supplement. This summary does not discuss the consequences of an investment in our subscription rights, debt securities or warrants representing rights to purchase shares of our preferred stock, common stock, debt securities, or in units of more than one of our securities. The U.S. federal income tax consequences of such an investment will be discussed in the relevant prospectus supplement.

              A "U.S. stockholder" is a beneficial owner of shares of our preferred stock or common stock that is for U.S. federal income tax purposes:

    an individual who is a citizen or resident of the United States;

    a corporation, or other entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States or any state thereof or the District of Columbia;

    a trust, if a court within the United States is able to exercise primary supervision over its administration and one or more U.S. persons (as defined in the Code) have the authority to control all of its substantial decisions, or if the trust has a valid election in effect under applicable U.S. Treasury regulations to be treated as a domestic trust for U.S. federal income tax purposes; or

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    an estate, the income of which is subject to U.S. federal income taxation regardless of its source.

              A "non-U.S. stockholder" is a beneficial owner of shares of our preferred stock or common stock that is not a U.S. stockholder or an entity that is treated as a partnership for U.S. federal income tax purposes.

An investment in shares of our preferred stock or common stock is complex, and certain aspects of the U.S. tax treatment of such investment are not certain. Tax matters are very complicated and the tax consequences to a stockholder of an investment in the shares of our preferred stock or common stock will depend on the facts of such stockholder's particular situation. Stockholders are strongly encouraged to consult their own tax advisor regarding the U.S. federal income tax consequences of the acquisition, ownership and disposition of our preferred stock or common stock, as well as the effect of state, local and foreign tax laws and the effect of any possible changes in tax laws.

ELECTION TO BE TAXED AS A RIC

              As a BDC, we have elected to be treated and intend to operate in a manner so as to continuously qualify annually as a RIC under the Code. As a RIC, we generally will not pay corporate-level U.S. federal income taxes on our net ordinary income or capital gains that we timely distribute (or are deemed to distribute) to our stockholders as dividends. Instead, dividends we distribute (or are deemed to timely distribute) generally will be taxable to stockholders, and any net operating losses, foreign tax credits and most other tax attributes generally will not pass through to stockholders. We will be subject to U.S. federal corporate-level income tax on any undistributed income and gains. To continue to qualify as a RIC, we must, among other things, meet certain source of income and asset diversification requirements (as described below). In addition, we must distribute to our stockholders, for each taxable year at least 90% of our "investment company taxable income," as defined by the Code (the "Annual Distribution Requirement"). See "Risk Factors—Risks Relating to Our Business—We may be subject to additional corporate-level income taxes if we fail to maintain our status as a RIC."

TAXATION AS A RIC

              If we:

    qualify as a RIC; and

    satisfy the Annual Distribution Requirement;

then we will not be subject to U.S. federal income tax on the portion of our investment company taxable income and net capital gain (realized net long-term capital gain in excess of realized net short-term capital loss) that we timely distribute (or are deemed to timely distribute) to stockholders. We will be subject to U.S. federal income tax at the regular corporate rates on any net income or capital gains not distributed (or deemed distributed) to our stockholders.

              We will be subject to a 4% nondeductible U.S. federal excise tax on certain undistributed income unless we distribute in a timely manner an amount at least equal to the sum of (1) 98% of our ordinary income for each calendar year, (2) 98.2% of our capital gain net income for each calendar year and (3) any income realized, but not distributed, in preceding years (to the extent that U.S. federal income tax was not imposed on such amounts) less certain over-distributions in the prior year (collectively, the "Excise Tax Requirement"). We have paid in the past, and can be expected to pay in the future, such excise tax on a portion of our income.

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              Moreover, our ability to dispose of assets to meet our distribution requirements may be limited by (1) the illiquid nature of our portfolio and (2) other requirements relating to our status as a RIC, including the Diversification Tests (as defined below). If we dispose of assets to meet the Annual Distribution Requirement, the Diversification Tests, or the Excise Tax Requirement, we may make such dispositions at times that, from an investment standpoint, are not advantageous.

              To qualify as a RIC for U.S. federal income tax purposes, we generally must, among other things:

    qualify to be treated as a BDC at all times during each taxable year;

    derive in each taxable year at least 90% of our gross income from (a) dividends, interest, payments with respect to certain securities loans, gains from the sale of stock or other securities or foreign currencies or other income derived with respect to our business of investing in such stock, securities or foreign currencies, or (b) net income derived from an interest in a "qualified publicly traded partnership," or "QPTP" (collectively, the "90% Income Test"); and

    diversify our holdings so that at the end of each quarter of the taxable year:

    at least 50% of the value of our assets consists of cash, cash equivalents, U.S. government securities, securities of other RICs and other securities that, with respect to any issuer, do not represent more than 5% of the value of our assets or more than 10% of the outstanding voting securities of that issuer; and

    no more than 25% of the value of our assets is invested in the securities, other than U.S. government securities or securities of other RICs, of (i) one issuer, (ii) two or more issuers that are controlled, as determined under the Code, by us and that are engaged in the same or similar or related trades or businesses, or (iii) securities of one or more QPTPs (collectively, the "Diversification Tests").

              We may be required to recognize taxable income for U.S. federal income tax purposes in circumstances in which we do not receive a corresponding payment in cash. For example, if we hold debt obligations that are treated under applicable tax rules as having original issue discount, or "OID" (such as debt instruments with "payment-in-kind" interest or, in certain cases, that have increasing interest rates or that are issued with warrants), we must include in income each year a portion of the original issue discount that accrues over the life of the obligation, regardless of whether cash representing such income is received by us in the same taxable year. Because any original issue discount or other amounts accrued will be included in our investment company taxable income for the year of accrual, we may be required to make a distribution to our stockholders in order to satisfy the Annual Distribution Requirement and the Excise Tax Requirement, even though we will not have received any corresponding cash amount. In order to enable us to make distributions to stockholders that will be sufficient to enable us to satisfy the Annual Distribution Requirement and the Excise Tax Requirement we may need to liquidate or sell some of our assets at times or at prices that are not advantageous, raise additional equity or debt capital, take out loans, forego new investment opportunities or otherwise take actions that are disadvantageous to our business (or be unable to take actions that are advantageous to our business). If we borrow money, we may be prevented by loan covenants from declaring and paying dividends in certain circumstances. Even if we are authorized to borrow funds and to sell assets in order to satisfy distribution requirements, under the Investment Company Act, we are generally not permitted to make distributions to our stockholders while our debt obligations and senior securities are outstanding unless certain "asset coverage" tests or other financial covenants are met. Limits on our payment of dividends may prevent us from meeting the Annual Distribution Requirement, and may, therefore, jeopardize our qualification for taxation as a RIC, or subject us to the 4% excise tax on undistributed income.

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              A portfolio company in which we invest may face financial difficulty that requires us to work-out, modify or otherwise restructure our investment in the portfolio company. Any such restructuring could, depending on the specific terms of the restructuring, cause us to recognize taxable income without a corresponding receipt of cash, which could affect our ability to satisfy the Annual Distribution Requirement or the Excise Tax Requirement, or result in unusable capital losses and future non-cash income. Any such reorganization could also result in our receiving assets that give rise to non-qualifying income for purposes of the 90% Income Test.

              Certain of our investment practices may be subject to special and complex U.S. federal income tax provisions that may, among other things, (a) disallow, suspend or otherwise limit the allowance of certain losses or deductions, (b) convert long-term capital gain (currently taxed at lower rates for non-corporate taxpayers) into higher taxed short-term capital gain or ordinary income, (c) convert an ordinary loss or a deduction into a capital loss (the deductibility of which is more limited), (d) adversely affect the time as to when a purchase or sale of stock or securities is deemed to occur, (e) adversely alter the characterization of certain complex financial transactions, (f) treat dividends that would otherwise constitute qualified dividend income as non-qualified dividend income, (g) cause us to recognize income or gain without receipt of a corresponding cash payment, and (h) produce income that will not be qualifying income for purposes of the 90% Income Test. We will monitor our transactions and may make certain tax elections in order to mitigate the effects of these provisions; however, no assurance can be given that we will be eligible for any such tax elections or that any elections we make will fully mitigate the effects of these provisions.

              Gain or loss recognized by us from warrants acquired by us as well as any loss attributable to the lapse of such warrants generally will be treated as capital gain or loss. Such gain or loss generally will be long-term or short-term, depending on how long we held a particular warrant.

              Our investment in non-U.S. securities may be subject to non-U.S. income, withholding and other taxes. In that case, our yield on those securities would be decreased. Stockholders will generally not be entitled to claim a U.S. foreign tax credit or deduction with respect to non-U.S. taxes paid by us.

              If we purchase shares in a PFIC, we may be subject to U.S. federal income tax on a portion of any "excess distribution" received on, or gain from the disposition of, such shares, even if such income is distributed as a taxable dividend by us to our stockholders. Additional charges in the nature of interest may be imposed on us in respect of deferred taxes arising from such distributions or gains. If we invest in a PFIC and elect to treat the PFIC as a "qualified electing fund" under the Code (a "QEF"), in lieu of the foregoing requirements, we will be required to include in income each year a portion of the ordinary earnings and net capital gain of the QEF, even if such income is not distributed to us. The IRS and U.S. Treasury Department have issued proposed Treasury regulations that, if adopted, provide that the income inclusion from a QEF does not constitute qualifying income for purposes of the 90% Income Test unless we receive a distribution from such entity in the same year out of earnings and profits attributable to the included income. Alternatively, we may elect to mark-to-market at the end of each taxable year our shares in such PFIC; in this case, we will recognize as ordinary income any increase in the value of such shares, and as ordinary loss any decrease in such value to the extent it does not exceed prior increases included in income. Our ability to make either election will depend on factors beyond our control, and we are subject to restrictions that may limit the availability or benefit of these elections. Under either election, we may be required to recognize in any year income in excess of our distributions from PFICs and our proceeds from dispositions of PFIC stock during that year, and such income will nevertheless be subject to the Annual Distribution Requirement and will be taken into account for purposes of determining whether we satisfy the Excise Tax Requirement.

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              Our functional currency is the U.S. dollar for U.S. federal income tax purposes. Under Section 988 of the Code, gains or losses attributable to fluctuations in exchange rates between the time we accrue income, expenses or other liabilities denominated in a foreign currency and the time we actually collect such income or pay such expenses or liabilities may be treated as ordinary income or loss. Similarly, gains or losses on foreign currency forward contracts, the disposition of debt denominated in a foreign currency and other financial transactions denominated in foreign currency, to the extent attributable to fluctuations in exchange rates between the acquisition and disposition dates, may also be treated as ordinary income or loss.

              Some of the income and fees that we recognize, such as management fees, may not satisfy the 90% Income Test. In order to ensure that such income and fees do not disqualify us as a RIC for a failure to satisfy the 90% Income Test, we may be required to recognize such income or fees through one or more entities treated as U.S. corporations for U.S. federal income tax purposes. While we expect that recognizing such income through such corporations will assist us in satisfying the 90% Income Test, no assurance can be given that this structure will be respected for U.S. federal income tax purposes, which could result in such income not being counted towards satisfying the 90% Income Test. If the amount of such income were too great and we were otherwise unable to mitigate this effect, it could result in our disqualification as a RIC. If, as we expect, the structure is respected, such corporations will be required to pay U.S. corporate income tax on their earnings, which ultimately will reduce the yield on such income and fees.

              We are limited in our ability to deduct expenses in excess of our investment company taxable income. If our expenses in a given year exceed our investment company taxable income, we will have a net operating loss for that year. However, we are not permitted to carry forward our net operating losses to subsequent years, so these net operating losses generally will not pass through to our stockholders. In addition, expenses can be used only to offset investment company taxable income, and may not be used to offset net capital gain. As a RIC, we may not use any net capital losses (that is, realized capital losses in excess of realized capital gains) to offset our investment company taxable income, but may carry forward those losses, and use them to offset future capital gains, indefinitely. Further, our deduction of net business interest expense is limited to 30% of our "adjusted taxable income" plus "floor plan financing interest expense." Due to these limits on the deductibility of expenses, net capital losses and business interest expenses, we may have aggregate taxable income that we are required to distribute and that is taxable to stockholders even if this income is greater than the aggregate net income we actually earned during those years.

FAILURE TO QUALIFY AS A RIC

              If we fail to satisfy the 90% Income Test for any taxable year or the Diversification Tests for any quarter of the taxable year, we may still continue to be taxed as a RIC for the relevant taxable year if we are eligible for relief provisions if the failures are due to reasonable cause and not willful neglect and if a penalty tax is paid with respect to each failure to satisfy the applicable requirements. Additionally, relief is provided for certain de minimis failures of the diversification requirements where we correct the failure within a specified period. If the applicable relief provisions are not available or cannot be met, all of our income would be subject to corporate-level income tax as described below. We cannot provide assurance that we would qualify for any such relief should we fail the 90% Income Test or the Diversification Tests.

              If we were to fail to meet the RIC requirements for more than two consecutive years and then seek to requalify as a RIC, we would be required to pay corporate level tax on the unrealized appreciation recognized during the succeeding five-year period unless we make a special election to recognize gain to the extent of any unrealized appreciation in our assets at the time of requalification.

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              If we are unable to qualify for treatment as a RIC, and relief is not available as discussed above, we would be subject to tax on all of our taxable income at the regular corporate U.S. federal income tax rate (and we also would be subject to any applicable state and local taxes). We would not be able to deduct distributions to stockholders and would not be required to make distributions for U.S. federal income tax purposes. Distributions generally would be taxable to our stockholders as ordinary dividend income to the extent of our current and accumulated earnings and profits. Subject to certain limitations under the Code, corporate U.S. stockholders would be eligible for the dividends-received deduction. Distributions in excess of our current and accumulated earnings and profits would be treated first as a return of capital to the extent of the stockholder's adjusted tax basis in its shares of our preferred stock or common stock, and any remaining distributions would be treated as capital gains. See "Election to Be Taxed as a RIC" above and "Risk Factors—Risks Relating to Our Business—We may be subject to additional corporate-level income taxes if we fail to maintain our status as a RIC." The following discussion assumes that we qualify as a RIC.

TAXATION OF U.S. STOCKHOLDERS

              The following summary generally describes certain material U.S. federal income tax consequences of an investment in shares of our preferred stock and common stock beneficially owned by U.S. stockholders (as defined above). If you are not a U.S. stockholder, this section does not apply to you.

              Whether an investment in the shares of our preferred stock or common stock is appropriate for a U.S. stockholder will depend upon that person's particular circumstances. An investment in the shares of our preferred stock or common stock by a U.S. stockholder may have adverse tax consequences. U.S. stockholders should consult their own tax advisors about the U.S. tax consequences of investing in shares of our preferred stock or common stock.

      Distributions on Our Preferred Stock and Common Stock

              Distributions by us generally are taxable as ordinary income or capital gain. To the extent such distributions we pay to non-corporate U.S. stockholders (including individuals) are attributable to dividends from U.S. corporations and certain qualified foreign corporations, such distributions ("qualified dividends") generally are taxable to U.S. stockholders at the preferential rates applicable to long-term capital gains. A portion of our ordinary dividends, but not capital gain dividends, paid to U.S. corporate stockholders may, if certain conditions are met, qualify for the dividends-received deduction to the extent that we have received dividends from certain corporations during the taxable year. However, it is anticipated that distributions paid by us generally will not be attributable to dividends and, therefore, generally will not qualify for the preferential rates applicable to qualified dividends or the dividends-received deduction available to corporations under the Code. A corporate U.S. stockholder may be required to reduce its basis in our preferred stock or common stock with respect to certain "extraordinary dividends," as defined in Section 1059 of the Code. Corporate U.S. stockholders should consult their own tax advisors in determining the application of these rules in their particular circumstances. We first allocate our earnings and profits to distributions to our preferred stockholders and then to distributions to our common stockholders based on priority in our capital structure. Distributions of our investment company taxable income will be taxable as ordinary income to U.S. stockholders to the extent of our current and accumulated earnings and profits, whether paid in cash or reinvested in additional shares of our common stock. Distributions of our net capital gain properly reported by us as "capital gain dividends" will be taxable to a U.S. stockholders as long-term capital gains (which, under current law, are taxed at preferential rates) in the case of individuals, trusts or estates. This is true regardless of the U.S. stockholder's holding period in our preferred stock or common stock and regardless of whether the dividend is paid in cash or reinvested in additional common stock. Distributions in excess of our earnings and profits first will reduce a U.S. stockholder's

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adjusted tax basis in such U.S. stockholder's preferred stock or common stock and, after the adjusted tax basis is reduced to zero, will constitute capital gain to such U.S. stockholder. We have made distributions in excess of our earnings and profits and may continue to do so in the future. As a result, a U.S. stockholder will need to consider the effect of our distributions on such U.S. stockholder's adjusted tax basis in our preferred stock or common stock in their individual circumstances.

              Although we currently intend to distribute our net capital gain for each taxable year on a timely basis, we may in the future decide to retain some or all of our net capital gain, and may designate the retained amount as a "deemed dividend." In that case, among other consequences: we will pay U.S. federal corporate income tax on the retained amount; each U.S. stockholder will be required to include their pro rata share of the deemed distribution in income as if it had been actually distributed to them; and the U.S. stockholder will be entitled to claim a credit equal to their pro rata share of the tax paid thereon by us. The amount of the deemed distribution net of such tax will be added to the U.S. stockholder's adjusted tax basis in our preferred stock or common stock.

              For purposes of determining (1) whether the Annual Distribution Requirement is satisfied for any year and (2) the amount of capital gains dividends paid for that year, we may, under certain circumstances, elect to treat a dividend that is paid during the following taxable year as if it had been paid during the taxable year in question. If we make such an election, a U.S. stockholder will still be treated as receiving the dividend in the taxable year in which the distribution is made. However, any dividend declared by us in October, November or December of any calendar year, payable to stockholders of record on a specified date in such a month and actually paid during January of the following year, will be treated as if it had been received by a U.S. stockholders on December 31 of the year in which the dividend was declared.

              We have the ability to declare a large portion of a dividend in shares of our stock. As long as a portion of such dividend is paid in cash and certain requirements are met, the entire distribution will be treated as a dividend for U.S. federal income tax purposes. As a result, a U.S. stockholder will be taxed on 100% of the fair market value of the dividend on the date the dividend is received in the same manner as a cash dividend, even if most of the dividend was paid in shares of our stock. If stockholders purchase shares of our preferred stock or common stock shortly before the record date of a distribution, the price of the shares will include the value of the distribution and such U.S. stockholder will be subject to tax on the distribution even though it economically represents a return of his, her or its investment.

              Distributions out of our current and accumulated earnings and profits will not be eligible for the 20% pass-through deduction under Section 199A of the Code, although under recently proposed regulations (that have not yet been finalized) qualified REIT dividends earned by us may qualify for the 20% pass-through deduction under Section 199A deduction.

      Sale or Other Disposition of Our Preferred Stock or Common Stock

              A U.S. stockholder generally will recognize taxable gain or loss if the U.S. stockholder sells or otherwise disposes of such stockholder's shares of our preferred stock or common stock. The amount of gain or loss will be measured by the difference between a U.S. stockholder's adjusted tax basis in our preferred stock or common stock sold or otherwise disposed of and the amount of the proceeds received in exchange. Any gain or loss arising from such sale or other disposition generally will be treated as long-term capital gain or loss if a U.S. stockholder has held our preferred stock or common stock for more than one year. Otherwise, such gain or loss will be classified as short-term capital gain or loss. However, any capital loss arising from the sale or disposition of shares of our preferred stock or common stock in which a U.S. stockholder has a holding period of six months or less will be treated as long-term capital loss to the extent of the amount of capital gain dividends received, or undistributed capital gain deemed received, with respect to such shares. In addition, all or a portion of any loss

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recognized upon a disposition of shares of our preferred stock or common stock may be disallowed if substantially identical stock or securities are purchased (whether through reinvestment of distributions or otherwise) within 30 days before or after the disposition.

              In general, U.S. stockholders that are individuals, trusts or estates are taxed at preferential rates on their net capital gain. Such rate is lower than the maximum rate on ordinary income currently payable by individuals. Corporate U.S. stockholders currently are subject to U.S. federal income tax on net capital gain at the maximum rate that also applies to ordinary income. Non-corporate U.S. stockholders with net capital losses for a year (i.e., capital loss in excess of capital gain) generally may deduct up to $3,000 of such losses against their ordinary income each year; any net capital losses of a non-corporate U.S. stockholder in excess of $3,000 generally may be carried forward and used in subsequent years as provided in the Code. Corporate U.S. stockholders generally may not deduct any net capital losses for a year, but may carry back such losses for three years or carry forward such losses for five years.

      Information Reporting and Backup Withholding

              We will send to each of our U.S. stockholders, after the end of each calendar year, a notice providing, on a per share and per distribution basis, the amounts includible in such U.S. stockholder's taxable income for such year as ordinary income and as long-term capital gain. In addition, the U.S. federal tax status of each year's distributions generally will be reported to the IRS. Distributions may also be subject to additional state, local and foreign taxes depending on a U.S. stockholder's particular situation.

              We may be required to withhold U.S. federal income tax ("backup withholding") from all taxable distributions to a U.S. stockholder (1) who fails to furnish us with a correct taxpayer identification number or a certificate that such stockholder is exempt from backup withholding or (2) with respect to whom the IRS notifies us that such stockholder is subject to backup withholding. An individual's taxpayer identification number is his or her social security number. Backup withholding is not an additional tax. Any amount withheld under backup withholding is allowed as a credit against the U.S. stockholder's U.S. federal income tax liability and may entitle such stockholder to a refund, provided that proper information is timely provided to the IRS.

      Medicare Tax on Net Investment Income

              Non-corporate U.S. stockholders generally are subject to a 3.8% Medicare surtax on their "net investment income," the calculation of which includes interest income and OID, any taxable gain from the disposition of our preferred stock or common stock and any distributions on our preferred stock or common stock (including the amount of any deemed distribution) to the extent such distribution is treated as a dividend or as capital gain (as described above under "Taxation of U.S. Stockholders—Distributions on Our Preferred Stock or Common Stock"). Non-corporate U.S. stockholders should consult their own tax advisors on the effect of acquiring, holding and disposing of our preferred stock or common stock, on the computation of "net investment income" in their individual circumstances.

      Disclosure of Certain Recognized Losses.

              Under U.S. Treasury regulations, if a U.S. stockholder recognizes a loss with respect to either our preferred stock or common stock of $2 million or more for a non-corporate U.S. stockholder or $10 million or more for a corporate U.S. stockholder in any single taxable year, such stockholder must file with the IRS a disclosure statement on Form 8886. Direct stockholders of certain "portfolio securities" in many cases are excepted from this reporting requirement, but under current guidance, equity owners of a RIC are not excepted. The fact that a loss is reportable under these regulations does not affect the legal determination of whether the taxpayer's treatment of the loss is proper.

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Significant monetary penalties apply to a failure to comply with this reporting requirement. States may also have a similar reporting requirement. U.S. stockholders should consult their own tax advisors to determine the applicability of these regulations in light of their individual circumstances.

TAXATION OF NON-U.S. STOCKHOLDERS

              The following discussion applies only to persons that are non-U.S. stockholders. If you are not a non-U.S. stockholder, this discussion does not apply to you.

              Whether an investment in our preferred stock or common stock is appropriate for a non-U.S. stockholder will depend upon that stockholder's particular circumstances. An investment in our preferred stock or common stock by a non-U.S. stockholder may have adverse tax consequences and, accordingly, may not be appropriate for a non-U.S. stockholder. Non-U.S. stockholders should consult their own tax advisors as to the tax consequences of acquiring, holding and disposing of our preferred stock or common stock before investing.

      Distributions on, and Sale or Other Disposition of, Our Preferred Stock or Common Stock

              Distributions of our investment company taxable income to non-U.S. stockholders will be subject to U.S. withholding tax at a rate of 30% (unless lowered or eliminated by an applicable income tax treaty) to the extent payable from our current and accumulated earnings and profits unless an exception applies.

              Actual or deemed distributions of our net capital gain to a non-U.S. stockholder, and gains recognized by a non-U.S. stockholder upon the sale of our preferred stock or common stock, will not be subject to withholding of U.S. federal income tax and generally will not be subject to U.S. federal income tax unless the non-U.S. stockholder is an individual, has been present in the United States for 183 days or more during the taxable year, and certain other conditions are satisfied. Non-U.S. stockholders of our preferred stock or common stock are encouraged to consult their own advisors as to the applicability of an income tax treaty in their individual circumstances.

              In general, no U.S. source withholding taxes will be imposed on dividends paid by RICs to non- U.S. stockholders to the extent the dividends are designated as "interest-related dividends" or "short-term capital gain dividends." Under this exemption, interest-related dividends and short-term capital gain dividends generally represent distributions of interest or short-term capital gain that would not have been subject to U.S. withholding tax at the source if they had been received directly by a non-U.S. stockholder, and that satisfy certain other requirements. We expect that a portion of our dividends will qualify as interest-related dividends, although we cannot assure you the exact proportion that will so qualify.

              If we distribute our net capital gain in the form of deemed rather than actual distributions (which we may do in the future), a non-U.S. stockholder will be entitled to a U.S. federal income tax credit or tax refund equal to the non-U.S. stockholder's allocable share of the tax we pay on the capital gain deemed to have been distributed. In order to obtain the refund, the non-U.S. stockholder must obtain a U.S. taxpayer identification number (if one has not been previously obtained) and file a U.S. federal income tax return even if the non-U.S. stockholder would not otherwise be required to obtain a U.S. taxpayer identification number or file a U.S. federal income tax return.

              We have the ability to declare a large portion of a dividend in shares of our common stock. As long as a portion of such dividend is paid in cash and certain requirements are met, the entire distribution will be treated as a dividend for U.S. federal income tax purposes. As a result, our non-U.S. stockholders will be taxed on 100% of the fair market value of the dividend on the date the dividend is received in the same manner as a cash dividend (including the application of withholding tax rules described above), even if most of the dividend is paid in shares of our common stock. In such

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a circumstance, we may be required to withhold all or substantially all of the cash we would otherwise distribute to a non-U.S. stockholder.

      Information Reporting and Backup Withholding

              A non-U.S. stockholder who is otherwise subject to withholding of U.S. federal income tax, may be subject to information reporting and backup withholding of U.S. federal income tax on dividends unless the non-U.S. stockholder provides us or the dividend paying agent with an IRS Form W-8BEN or IRS Form W-8BEN-E (or an acceptable substitute form) or otherwise meets documentary evidence requirements for establishing that it is a non-U.S. stockholder or otherwise establishes an exemption from backup withholding.

WITHHOLDING AND INFORMATION REPORTING ON FINANCIAL ACCOUNTS

              Pursuant to Sections 1471 to 1474 of the Code and the U.S. Treasury regulations thereunder, the relevant withholding agent generally will be required to withhold 30% of any dividends paid on our preferred stock or common stock to: (i) a foreign financial institution unless such foreign financial institution agrees to verify, report and disclose its U.S. accountholders and meets certain other specified requirements or (ii) a non-financial foreign entity that is the beneficial owner of the payment unless such entity certifies that it does not have any substantial U.S. owners or provides the name, address and taxpayer identification number of each substantial U.S. owner and such entity meets certain other specified requirements or is subject to an applicable "intergovernmental agreement." If payment of this withholding tax is made, non-U.S. stockholders that are otherwise eligible for an exemption from, or reduction of, U.S. federal withholding taxes with respect to such dividends or proceeds will be required to seek a credit or refund from the IRS to obtain the benefit of such exemption or reduction. In certain cases, the relevant foreign financial institution or non-financial foreign entity may qualify for an exemption from, or be deemed to be in compliance with, these rules. Certain jurisdictions have entered into agreements with the United States that may supplement or modify these rules. Non-U.S. stockholders should consult their own tax advisers regarding the particular consequences to them of this legislation and guidance. We will not pay any additional amounts in respect of any amounts withheld.

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DESCRIPTION OF SECURITIES

              This prospectus contains a summary of the common stock, preferred stock, subscription rights, debt securities, warrants and units. These summaries are not meant to be a complete description of each security. However, this prospectus and the accompanying prospectus supplement will contain the material terms and conditions for each security.

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DESCRIPTION OF OUR CAPITAL STOCK

               The following description is based on relevant portions of the Maryland General Corporation Law and on our charter and bylaws. This summary is not necessarily complete, and we refer you to the Maryland General Corporation Law and our charter and bylaws for a more detailed description of the provisions summarized below.

STOCK

              Our authorized stock consists of 600,000,000 shares of stock, par value $0.001 per share, all of which are currently designated as common stock. Our common stock trades on The NASDAQ Global Select Market under the symbol "ARCC." On May 21, 2019, the last reported sales price of our common stock on The NASDAQ Global Select Market was $17.96 per share. There are no outstanding options or warrants to purchase our stock. No stock has been authorized for issuance under any equity compensation plans. Under Maryland law, our stockholders generally are not personally liable for our indebtedness or obligations.

              Under our charter, our board of directors is authorized to classify any unissued shares of stock and reclassify any previously classified but unissued shares of stock into one or more classes or series of stock and authorize the issuance of shares of stock without obtaining stockholder approval. As permitted by the Maryland General Corporation Law, our charter provides that a majority of the entire board of directors, without any action by our stockholders, may amend the charter from time to time to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that we have authority to issue.

Common Stock

              All shares of our common stock have equal rights as to earnings, assets, dividends and voting and, when they are issued, will be duly authorized, validly issued, fully paid and nonassessable. Distributions may be paid to the holders of our common stock if, as and when authorized by our board of directors and declared by us out of funds legally available therefor. Shares of our common stock have no preemptive, exchange, conversion or redemption rights and are freely transferable, except where their transfer is restricted by federal and state securities laws or by contract.

              In the event of our liquidation, dissolution or winding up, each share of our common stock would be entitled to share ratably in all of our assets that are legally available for distribution after we pay off all indebtedness and other liabilities and subject to any preferential rights of holders of our preferred stock, if any preferred stock is outstanding at such time.

              Each share of our common stock is entitled to one vote on all matters submitted to a vote of stockholders, including the election of directors. Except as provided with respect to any other class or series of stock, the holders of our common stock will possess exclusive voting power. There is no cumulative voting in the election of our directors, which means that holders of a majority of the outstanding shares of common stock can elect all of our directors.

              The following are our outstanding classes of capital stock as of May 16, 2019:

(1)
Title of Class
  (2)
Amount Authorized
  (3)
Amount Held by
Registrant
or for its
Account
  (4)
Amount Outstanding
Exclusive of Amount
Shown Under
Column (3)
 

Common Stock

    600,000,000         426,298,200  

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Preferred Stock

              Our charter authorizes our board of directors to classify any unissued shares of stock and reclassify any previously classified but unissued shares of stock into other classes or series of stock, including preferred stock. Prior to issuance of shares of each class or series, the board of directors is required by Maryland law and by our charter to set the terms, preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption for each class or series. Thus, our board of directors could authorize the issuance of shares of our preferred stock with terms and conditions that could have the effect of delaying, deferring or preventing a transaction or a change in control that might involve a premium price for holders of our common stock or otherwise be in their best interest.

              You should note, however, that any issuance of preferred stock must comply with the requirements of the Investment Company Act. The Investment Company Act requires, among other things, that (a) immediately after issuance and before any dividend or other distribution is made with respect to our common stock and before any purchase of common stock is made, such preferred stock together with all other indebtedness and senior securities must not exceed an amount equal to 50% of our total assets after deducting the amount of such dividend, distribution or purchase price, as the case may be and (b) the holders of shares of preferred stock, if any are issued, must be entitled as a class to elect two directors at all times and to elect a majority of the directors if dividends on such preferred stock are in arrears by two years or more. Certain matters under the Investment Company Act require the separate vote of the holders of any issued and outstanding preferred stock. For example, holders of preferred stock would vote separately from the holders of common stock on a proposal to cease operations as a BDC. We believe that the availability for issuance of preferred stock may provide us with increased flexibility in structuring future financings and acquisitions.

LIMITATION ON LIABILITY OF DIRECTORS AND OFFICERS; INDEMNIFICATION AND ADVANCE OF EXPENSES

              Maryland law permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty established by a final adjudication as being material to the cause of action. Our charter contains such a provision, which eliminates directors' and officers' liability to the maximum extent permitted by Maryland law, subject to the requirements of the Investment Company Act.

              Our charter authorizes us to obligate ourselves, and our bylaws obligate us, to the maximum extent permitted by Maryland law and subject to the requirements of the Investment Company Act, to indemnify any present or former director or officer or any individual who, while a director or officer and at our request, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee, from and against any claim or liability to which that person may become subject or which that person may incur by reason of his or her service in that capacity and to pay or reimburse his or her reasonable expenses in advance of final disposition of a proceeding. The charter and bylaws also permit us to indemnify and advance expenses to any person who served a predecessor of us in any of the capacities described above and any of our employees or agents or any employees or agents of our predecessor. In accordance with the Investment Company Act, we will not indemnify any person for any liability to which such person would be subject by reason of such person's willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office.

              In addition to the indemnification provided for in our bylaws, we have entered into indemnification agreements with each of our current directors and certain of our officers and with

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members of our investment adviser's investment committee and we intend to enter into indemnification agreements with each of our future directors, members of our investment committee and certain of our officers. The indemnification agreements attempt to provide these directors, officers and other persons the maximum indemnification permitted under Maryland law and the Investment Company Act. The agreements provide, among other things, for the advancement of expenses and indemnification for liabilities that such person may incur by reason of his or her status as a present or former director or officer or member of our investment adviser's investment committee in any action or proceeding arising out of the performance of such person's services as a present or former director or officer or member of our investment adviser's investment committee.

              Maryland law requires a corporation (unless its charter provides otherwise, which our charter does not) to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made or threatened to be made a party by reason of his or her service in that capacity. Maryland law permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made or are threatened to be made a party by reason of their service in those or other capacities unless it is established that (a) the act or omission of the director or officer was material to the matter giving rise to the proceeding and (i) was committed in bad faith or (ii) was the result of active and deliberate dishonesty, (b) the director or officer actually received an improper personal benefit in money, property or services or (c) in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. However, under Maryland law, a Maryland corporation may not indemnify for an adverse judgment in a suit by or in the right of the corporation or for a judgment of liability on the basis that a personal benefit was improperly received, unless in either case a court orders indemnification, and then only for expenses. In addition, Maryland law permits a corporation to advance reasonable expenses to a director or officer upon the corporation's receipt of (x) a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation and (y) a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the standard of conduct was not met.

PROVISIONS OF THE MARYLAND GENERAL CORPORATION LAW AND OUR CHARTER AND BYLAWS

              The Maryland General Corporation Law and our charter and bylaws contain provisions that could make it more difficult for a potential acquiror to acquire us by means of a tender offer, proxy contest or otherwise. These provisions are expected to discourage certain coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of us to negotiate first with our board of directors. We believe that the benefits of these provisions outweigh the potential disadvantages of discouraging any such acquisition proposals because, among other things, the negotiation of such proposals may improve their terms.

Classified Board of Directors

              Our board of directors is divided into three classes of directors serving staggered three-year terms, with the term of office of only one of the three classes expiring each year. A classified board may render a change in control of us or removal of our incumbent management more difficult. We believe, however, that the longer time required to elect a majority of a classified board of directors helps to ensure the continuity and stability of our management and policies.

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Election of Directors

              Our bylaws provide that the affirmative vote of the majority of the votes cast at a meeting of stockholders duly called and at which a quorum is present shall be sufficient to elect each director; provided, that if the number of nominees for director exceeds the number of directors to be elected, directors will be elected by a plurality of votes cast. Pursuant to the charter, our board of directors may amend the bylaws to alter the vote required to elect directors.

Number of Directors; Vacancies; Removal

              Our charter provides that the number of directors will be set only by the board of directors in accordance with our bylaws. Our bylaws provide that a majority of our entire board of directors may at any time increase or decrease the number of directors. However, unless our bylaws are amended, the number of directors may never be less than four or more than eleven. Our charter sets forth our election, subject to certain requirements, to be subject to the provision of Subtitle 8 of Title 3 of the Maryland General Corporation Law regarding the filling of vacancies on the board of directors. Accordingly, except as may be provided by the board of directors in setting the terms of any class or series of preferred stock, any and all vacancies on the board of directors may be filled only by the affirmative vote of a majority of the remaining directors in office, even if the remaining directors do not constitute a quorum, and any director elected to fill a vacancy will serve for the remainder of the full term of the directorship in which the vacancy occurred and until a successor is elected and qualifies, subject to any applicable requirements of the Investment Company Act.

              Our charter provides that a director may be removed only for cause, as defined in our charter, and then only by the affirmative vote of stockholders entitled to cast at least two-thirds of the votes entitled to be cast generally in the election of directors.

Action by Stockholders

              Under the Maryland General Corporation Law and our charter, stockholder action can be taken only at an annual or special meeting of stockholders or by unanimous written or electronically transmitted consent instead of a meeting. These provisions, combined with the requirements of our bylaws regarding the calling of a stockholder-requested special meeting of stockholders discussed below, may have the effect of delaying consideration of a stockholder proposal until the next annual meeting.

Advance Notice Provisions for Stockholder Nominations and Stockholder Proposals

              Our bylaws provide that with respect to an annual meeting of stockholders, nominations of individuals for election to the board of directors and the proposal of business to be considered by stockholders may be made only (a) pursuant to our notice of the meeting, (b) by or at the direction of the board of directors or (c) by a stockholder who is a stockholder of record at the record date set by our board of directors for the purpose of determining stockholders entitled to vote at the meeting, at the time of giving the advance notice required by the bylaws and at the time of the meeting (and any adjournment or postponement thereof), is entitled to vote at the meeting in the election of each individual so nominated or on any such other business and has complied with the advance notice procedures of the bylaws. With respect to special meetings of stockholders, only the business specified in our notice of the meeting may be brought before the meeting. Nominations of individuals for election to the board of directors at a special meeting may be made only (a) by or at the direction of the board of directors or (b) provided that the special meeting has been called in accordance with the bylaws for the purpose of electing directors, by a stockholder who is a stockholder of record at the time of giving the advance notice required by the bylaws and at the time of the meeting, who is entitled to vote at the meeting in the election of each individual so nominated and who has complied with the advance notice provisions of the bylaws.

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              The purpose of requiring stockholders to give us advance notice of nominations and other business is to afford our board of directors a meaningful opportunity to consider the qualifications of the proposed nominees and the advisability of any other proposed business and, to the extent deemed necessary or desirable by our board of directors, to inform stockholders and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings of stockholders. Although our bylaws do not give our board of directors any power to disapprove stockholder nominations for the election of directors or proposals recommending certain action, they may have the effect of precluding a contest for the election of directors or the consideration of stockholder proposals if proper procedures are not followed and of discouraging or deterring a third party from conducting a solicitation of proxies to elect its own slate of directors or to approve its own proposal without regard to whether consideration of such nominees or proposals might be harmful or beneficial to us and our stockholders.

Calling of Special Meetings of Stockholders

              Our bylaws provide that special meetings of stockholders may be called by our board of directors and certain of our officers. Additionally, our bylaws provide that, subject to the satisfaction of certain procedural and informational requirements by the stockholders requesting the meeting, a special meeting of stockholders must be called by the secretary of the corporation to act on any matter that may properly be considered at a meeting of stockholders upon the written request of stockholders entitled to cast not less than a majority of all the votes entitled to be cast on such matter at such meeting.

Approval of Extraordinary Corporate Action; Amendment of Charter and Bylaws

              Under Maryland law, a Maryland corporation generally cannot dissolve, amend its charter, merge, convert, sell all or substantially all of its assets, engage in a share exchange or engage in similar transactions outside the ordinary course of business, unless approved by the affirmative vote of stockholders entitled to cast at least two-thirds of the votes entitled to be cast on the matter. See "Risk Factors—Risks Relating to Offerings Pursuant to this Prospectus—Provisions of the Maryland General Corporation Law and of our charter and bylaws could deter takeover attempts and have an adverse effect on the price of our common stock." However, a Maryland corporation may provide in its charter for approval of these matters by a lesser percentage, but not less than a majority of all of the votes entitled to be cast on the matter. Our charter generally provides for approval of charter amendments and extraordinary transactions by the stockholders entitled to cast at least a majority of the votes entitled to be cast on the matter. Our charter also provides that certain charter amendments and any proposal for our conversion, whether by merger or otherwise, from a closed-end company to an open-end company or any proposal for our liquidation or dissolution requires the approval of the stockholders entitled to cast at least 80 percent of the votes entitled to be cast on such matter. However, if such amendment or proposal is approved by at least two-thirds of our continuing directors (as defined below) (in addition to approval by our board of directors), such amendment or proposal may be approved by a majority of the votes entitled to be cast on such a matter. The "continuing directors" are defined in our charter as our current directors as well as those directors whose nomination for election by the stockholders or whose election by the directors to fill vacancies is approved by a majority of the continuing directors then on the board of directors.

              Our charter and bylaws provide that the board of directors will have the exclusive power to adopt, alter or repeal any provision of our bylaws and to make new bylaws.

No Appraisal Rights

              Except with respect to appraisal rights arising in connection with the Control Share Acquisition Act discussed below, as permitted by the Maryland General Corporation Law, our charter provides that

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stockholders will not be entitled to exercise appraisal rights unless a majority of our board of directors determines that such rights will apply, with respect to all or any classes or series of stock, to one or more transactions occurring after the date of such determination in connection with which stockholders would otherwise be entitled to exercise appraisal rights.

Control Share Acquisitions

              The Control Share Acquisition Act provides that control shares of a Maryland corporation acquired in a control share acquisition have no voting rights except to the extent approved by a vote of at least two-thirds of the votes entitled to be cast on the matter. Shares owned by the acquiror, by officers or by employees who are directors of the corporation are excluded from shares entitled to vote on the matter. Control shares are voting shares of stock that, if aggregated with all other shares of stock owned by the acquiror or in respect of which the acquiror is able to exercise or direct the exercise of voting power (except solely by virtue of a revocable proxy), would entitle the acquiror to exercise voting power in electing directors within one of the following ranges of voting power:

    one-tenth or more but less than one-third;

    one-third or more but less than a majority; or

    a majority or more of all voting power.

              The requisite stockholder approval must be obtained each time an acquiror crosses one of the thresholds of voting power set forth above. Control shares do not include shares the acquiring person is then entitled to vote as a result of having previously obtained stockholder approval. A control share acquisition means the acquisition of issued and outstanding control shares, subject to certain exceptions.

              A person who has made or proposes to make a control share acquisition may compel the board of directors of the corporation to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the shares. The right to compel the calling of a special meeting is subject to the satisfaction of certain conditions, including an undertaking to pay the expenses of the meeting. If no request for a meeting is made, the corporation may itself present the question at any stockholders meeting.

              If voting rights are not approved at the meeting or if the acquiring person does not deliver an acquiring person statement as required by the statute, then the corporation may redeem for fair value any or all of the control shares, except those for which voting rights have previously been approved. The right of the corporation to redeem control shares is subject to certain conditions and limitations, including, as provided in our bylaws, compliance with the Investment Company Act, which will prohibit any such redemption other than in limited circumstances. Fair value is determined, without regard to the absence of voting rights for the control shares, as of the date of any meeting of stockholders at which the voting rights of the shares are considered and not approved or, if no such meeting is held, as of the date of the last control share acquisition by the acquiror. If voting rights for control shares are approved at a stockholders meeting and the acquiror becomes entitled to vote a majority of the shares entitled to vote, all other stockholders may exercise appraisal rights. The fair value of the shares as determined for purposes of appraisal rights may not be less than the highest price per share paid by the acquiror in the control share acquisition.

              The Control Share Acquisition Act does not apply (a) to shares acquired in a merger, consolidation or share exchange if the corporation is a party to the transaction or (b) to acquisitions approved or exempted by the charter or bylaws of the corporation.

              Our bylaws contain a provision exempting from the Control Share Acquisition Act any and all acquisitions by any person of our shares of stock and, as a result, any control shares of the Company

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will have the same voting rights as all of the other shares of the Company's common stock. Such provision could be amended or eliminated at any time in the future. However, we will amend our bylaws to be subject to the Control Share Acquisition Act only if the board of directors determines that it would be in our best interests and we determine (after consultation with the SEC staff) that our being subject to the Control Share Acquisition Act does not conflict with the Investment Company Act.

Business Combinations

              Under Maryland law, "business combinations" between a Maryland corporation and an interested stockholder or an affiliate of an interested stockholder are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include a merger, consolidation, share exchange or, in circumstances specified in the statute, an asset transfer or issuance or reclassification of equity securities. An interested stockholder is defined as:

    any person who, directly or indirectly, beneficially owns 10% or more of the voting power of the corporation's outstanding voting stock; or

    an affiliate or associate of the corporation who, at any time within the two-year period prior to the date in question, was the beneficial owner, directly or indirectly, of 10% or more of the voting power of the then outstanding stock of the corporation.

              A person is not an interested stockholder under this statute if the board of directors approved in advance the transaction by which such person otherwise would have become an interested stockholder. However, in approving a transaction, the board of directors may provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by the board.

              After the five-year prohibition, any business combination between the corporation and an interested stockholder generally must be recommended by the board of directors of the corporation and approved by the affirmative vote of at least:

    80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation; and

    two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other than shares held by the interested stockholder with whom or with whose affiliate the business combination is to be effected or held by an affiliate or associate of the interested stockholder.

              These super-majority vote requirements do not apply if the corporation's common stockholders receive a minimum price, as defined under Maryland law, for their shares in the form of cash or other consideration in the same form as previously paid by the interested stockholder for its shares.

              The statute permits various exemptions from its provisions, including business combinations that are exempted by the board of directors before the time that the interested stockholder becomes an interested stockholder. Our board of directors has adopted a resolution that any business combination between us and any other person is exempted from the provisions of the Business Combination Act, provided that the business combination is first approved by the board of directors, including a majority of the independent directors. This resolution, however, may be altered or repealed in whole or in part at any time. If this resolution is repealed, or the board of directors does not otherwise approve a business combination, the statute may discourage others from trying to acquire control of us and increase the difficulty of consummating any offer.

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Conflict with the Investment Company Act

              Our bylaws provide that, if and to the extent that any provision of the Maryland General Corporation Law, including the Control Share Acquisition Act (if we amend our bylaws to be subject to such act) and the Business Combination Act, or any provision of our charter or bylaws conflicts with any provision of the Investment Company Act, the applicable provision of the Investment Company Act will control.

Exclusive Forum

              Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the Circuit Court for Baltimore City, Maryland, or, if that Court does not have jurisdiction, the United States District Court for the District of Maryland, Baltimore Division, will be the sole and exclusive forum for: (i) any derivative action or proceeding brought on our behalf, (ii) any Internal Corporate Claim, as such term is defined in Section 1-101(p) of the MGCL, including, without limitation, (a) any action asserting a claim of breach of any duty owed by any of our directors or officers or other employees to us or to our stockholders or (b) any action asserting a claim against us or any of our directors or officers or other employees arising pursuant to any provision of the MGCL or our charter or bylaws, or (iii) any action asserting a claim against us or any of our directors or officers or other employees that is governed by the internal affairs doctrine. Any person or entity purchasing or otherwise acquiring or holding any interest in our shares shall be deemed to have notice of and to have consented and waived any objection to this exclusive forum provision of our bylaws, as the same may be amended from time to time.

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DESCRIPTION OF OUR PREFERRED STOCK

              In addition to shares of common stock, our charter authorizes the issuance of preferred stock. If we offer preferred stock under this prospectus, we will issue an appropriate prospectus supplement. We may issue preferred stock from time to time in one or more classes or series, without stockholder approval. Prior to issuance of shares of each class or series, our board of directors is required by Maryland law and by our charter to set, subject to the express terms of any of our then outstanding classes or series of stock, the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption for each class or series. Any such an issuance must adhere to the requirements of the Investment Company Act, Maryland law and any other limitations imposed by law.

              The Investment Company Act currently requires, among other things, that (a) immediately after issuance and before any distribution is made with respect to common stock, the liquidation preference of the preferred stock, together with all other senior securities, must not exceed an amount equal to 50% of our total assets (taking into account such distribution), (b) the holders of shares of preferred stock, if any are issued, must be entitled as a class to elect two directors at all times and to elect a majority of the directors if dividends on the preferred stock are in arrears by two years or more and (c) such class of stock have complete priority over any other class of stock as to distribution of assets and payment of dividends, which dividends shall be cumulative.

              For any class or series of preferred stock that we may issue, our board of directors will determine and the articles supplementary and the prospectus supplement relating to such class or series will describe:

    the designation and number of shares of such class or series;

    the rate and time at which, and the preferences and conditions under which, any dividends will be paid on shares of such class or series, as well as whether such dividends are participating or non-participating;

    any provisions relating to convertibility or exchangeability of the shares of such class or series, including adjustments to the conversion price of such class or series;

    the rights and preferences, if any, of holders of shares of such class or series upon our liquidation, dissolution or winding up of our affairs;

    the voting powers, if any, of the holders of shares of such class or series;

    any provisions relating to the redemption of the shares of such class or series;

    any limitations on our ability to pay dividends or make distributions on, or acquire or redeem, other securities while shares of such class or series are outstanding;

    any conditions or restrictions on our ability to issue additional shares of such class or series or other securities;

    if applicable, a discussion of certain U.S. federal income tax considerations; and

    any other relative powers, preferences and participating, optional or special rights of shares of such class or series, and the qualifications, limitations or restrictions thereof.

              All shares of preferred stock that we may issue will be identical and of equal rank except as to the particular terms thereof that may be fixed by our board of directors, and all shares of each class or series of preferred stock will be identical and of equal rank except as to the dates from which dividends, if any, thereon will be cumulative. You should read the accompanying prospectus supplement, as well as the complete articles supplementary that contain the terms of the applicable class or series of preferred stock.

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DESCRIPTION OF OUR SUBSCRIPTION RIGHTS

GENERAL

              We may issue subscription rights to our stockholders to purchase common stock. Subscription rights may be issued independently or together with any other offered security and may or may not be transferable by the person purchasing or receiving the subscription rights. In connection with a subscription rights offering to our stockholders, we would distribute certificates evidencing the subscription rights and a prospectus supplement to our stockholders on the record date that we set for receiving subscription rights in such subscription rights offering. You should read the prospectus supplement related to any such subscription rights offering.

              The applicable prospectus supplement would describe the following terms of subscription rights in respect of which this prospectus is being delivered:

    the period of time the offering would remain open (which shall be open a minimum number of days such that all record holders would be eligible to participate in the offering and shall not be open longer than 120 days);

    the title of such subscription rights;

    the exercise price for such subscription rights (or method of calculation thereof);

    the ratio of the offering (which, in the case of transferable rights, will require a minimum of three shares to be held of record before a person is entitled to purchase an additional share);

    the number of such subscription rights issued to each stockholder;

    the extent to which such subscription rights are transferable and the market on which they may be traded if they are transferable;

    if applicable, a discussion of certain U.S. federal income tax considerations applicable to the issuance or exercise of such subscription rights;

    the date on which the right to exercise such subscription rights shall commence, and the date on which such right shall expire (subject to any extension);

    the extent to which such subscription rights include an over-subscription privilege with respect to unsubscribed securities and the terms of such over-subscription privilege;

    any termination right we may have in connection with such subscription rights offering; and

    any other terms of such subscription rights, including exercise, settlement and other procedures and limitations relating to the transfer and exercise of such subscription rights.

              We will not offer any subscription rights to purchase shares of our common stock under this prospectus or an accompanying prospectus supplement without first filing a new post-effective amendment to the registration statement.

EXERCISE OF SUBSCRIPTION RIGHTS

              Each subscription right would entitle the holder of the subscription right to purchase for cash such amount of shares of common stock at such exercise price as shall in each case be set forth in, or be determinable as set forth in, the prospectus supplement relating to the subscription rights offered thereby. Subscription rights may be exercised at any time up to the close of business on the expiration date for such subscription rights set forth in the prospectus supplement. After the close of business on the expiration date, all unexercised subscription rights would become void.

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              Subscription rights may be exercised as set forth in the prospectus supplement relating to the subscription rights offered thereby. Upon receipt of payment and the subscription rights certificate properly completed and duly executed at the corporate trust office of the subscription rights agent or any other office indicated in the prospectus supplement we will forward, as soon as practicable, the shares of common stock purchasable upon such exercise. To the extent permissible under applicable law, we may determine to offer any unsubscribed offered securities directly to persons other than stockholders, to or through agents, underwriters or dealers or through a combination of such methods, as set forth in the applicable prospectus supplement.

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DESCRIPTION OF OUR WARRANTS

              The following is a general description of the terms of the warrants we may issue from time to time. Particular terms of any warrants we offer will be described in the prospectus supplement relating to such warrants. You should read the prospectus supplement related to any warrants offering.

              We may issue warrants to purchase shares of our common stock, preferred stock or debt securities. Such warrants may be issued independently or together with shares of common stock, preferred stock or debt securities and may be attached or separate from such securities. We will issue each series of warrants under a separate warrant agreement to be entered into between us and a warrant agent. The warrant agent will act solely as our agent and will not assume any obligation or relationship of agency for or with holders or beneficial owners of warrants.

              A prospectus supplement will describe the particular terms of any series of warrants we may issue, including the following:

    the title of such warrants;

    the aggregate number of such warrants;

    the price or prices at which such warrants will be issued;

    the currency or currencies, including composite currencies, in which the price of such warrants may be payable;

    if applicable, the designation and terms of the securities with which the warrants are issued and the number of warrants issued with each such security or each principal amount of such security;

    in the case of warrants to purchase debt securities, the principal amount of debt securities purchasable upon exercise of one warrant and the price at which and the currency or currencies, including composite currencies, in which this principal amount of debt securities may be purchased upon such exercise;

    in the case of warrants to purchase common stock or preferred stock, the number of shares of common stock or preferred stock, as the case may be, purchasable upon exercise of one warrant and the price at which and the currency or currencies, including composite currencies, in which these shares may be purchased upon such exercise;

    the date on which the right to exercise such warrants shall commence and the date on which such right will expire;

    whether such warrants will be issued in registered form or bearer form;

    if applicable, the minimum or maximum amount of such warrants that may be exercised at any one time;

    if applicable, the date on and after which such warrants and the related securities will be separately transferable;

    information with respect to book-entry procedures, if any;

    the terms of the securities issuable upon exercise of the warrants;

    if applicable, a discussion of certain U.S. federal income tax considerations; and

    any other terms of such warrants, including terms, procedures and limitations relating to the exchange and exercise of such warrants.

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              We and the warrant agent may amend or supplement the warrant agreement for a series of warrants without the consent of the holders of the warrants issued thereunder to effect changes that are not inconsistent with the provisions of the warrants and that do not materially and adversely affect the interests of the holders of the warrants.

              Prior to exercising their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable upon such exercise, including, in the case of warrants to purchase debt securities, the right to receive principal, premium, if any, or interest payments, on the debt securities purchasable upon exercise or to enforce covenants in the applicable indenture or, in the case of warrants to purchase common stock or preferred stock, the right to receive dividends, if any, or payments upon our liquidation, dissolution or winding up or to exercise any voting rights.

              Under the Investment Company Act, we may generally only offer warrants provided that (a) the warrants expire by their terms within ten years, (b) the exercise or conversion price is not less than the current market value at the date of issuance, (c) our stockholders authorize the proposal to issue such warrants, and our board of directors approves such issuance on the basis that the issuance is in the best interests of Ares Capital and its stockholders and (d) if the warrants are accompanied by other securities, the warrants are not separately transferable unless no class of such warrants and the securities accompanying them has been publicly distributed. The Investment Company Act also provides that the amount of our voting securities that would result from the exercise of all outstanding warrants, as well as options and rights, at the time of issuance may not exceed 25% of our outstanding voting securities.

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DESCRIPTION OF OUR DEBT SECURITIES

              We may issue debt securities in one or more series. The specific terms of each series of debt securities will be described in the particular prospectus supplement relating to that series. The prospectus supplement may or may not modify the general terms found in this prospectus and will be filed with the SEC. For a complete description of the terms of a particular series of debt securities, you should read this prospectus and the prospectus supplement relating to that particular series.

              As required by federal law for all bonds and notes of companies that are publicly offered, the debt securities are governed by a document called an "indenture." An indenture is a contract between us and U.S. Bank National Association, a financial institution acting as trustee on your behalf, and is subject to and governed by the Trust Indenture Act of 1939, as amended. The trustee has two main roles. First, the trustee can enforce your rights against us if we default. There are some limitations on the extent to which the trustee acts on your behalf, described in the second paragraph under "Events of Default—Remedies if an Event of Default Occurs." Second, the trustee performs certain administrative duties for us.

              Because this section is a summary, it does not describe every aspect of the debt securities and the indenture. We urge you to read the indenture because it, and not this description, defines your rights as a holder of debt securities. For example, in this section, we use capitalized words to signify terms that are specifically defined in the indenture. Some of the definitions are repeated in this prospectus, but for the rest you will need to read the indenture. We have filed the form of the indenture with the SEC. See "Available Information" for information on how to obtain a copy of the indenture.

              The prospectus supplement, which will accompany this prospectus, will describe the particular series of debt securities being offered, including, among other things:

    the designation or title of the series of debt securities;

    the total principal amount of the series of debt securities;

    the percentage of the principal amount at which the series of debt securities will be offered;

    the date or dates on which principal will be payable;

    the rate or rates (which may be either fixed or variable) and/or the method of determining such rate or rates of interest, if any;

    the date or dates from which any interest will accrue, or the method of determining such date or dates, and the date or dates on which any interest will be payable;

    the terms for redemption, extension or early repayment, if any;

    the currencies in which the series of debt securities are issued and payable;

    whether the amount of payments of principal, premium or interest, if any, on a series of debt securities will be determined with reference to an index, formula or other method (which could be based on one or more currencies, commodities, equity indices or other indices) and how these amounts will be determined;

    the place or places, if any, other than or in addition to the City of New York, of payment, transfer, conversion and/or exchange of the debt securities;

    the denominations in which the offered debt securities will be issued;

    the provision for any sinking fund;

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    any restrictive covenants;

    any Events of Default;

    whether the series of debt securities is issuable in certificated form;

    any provisions for defeasance or covenant defeasance;

    if applicable, U.S. federal income tax considerations relating to original issue discount;

    whether and under what circumstances we will pay additional amounts in respect of any tax, assessment or governmental charge and, if so, whether we will have the option to redeem the debt securities rather than pay the additional amounts (and the terms of this option);

    any provisions for convertibility or exchangeability of the debt securities into or for any other securities;

    whether the debt securities are subject to subordination and the terms of such subordination;

    the listing, if any, on a securities exchange; and

    any other terms.

              The debt securities may be secured or unsecured obligations. Unless the prospectus supplement states otherwise, principal (and premium, if any) and interest, if any, will be paid by us in immediately available funds.

              We are currently permitted, under specified conditions, to issue multiple classes of indebtedness if our asset coverage, calculated pursuant to the Investment Company Act, is at least equal to 200% immediately after each such issuance. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). In addition, while any indebtedness and senior securities remain outstanding, we must make provisions to prohibit the distribution to our stockholders or the repurchase of such securities or shares unless we meet the applicable asset coverage ratios at the time of the distribution or repurchase. Specifically, prior to June 21, 2019 (or such earlier date), we may be precluded from declaring dividends or repurchasing shares of our common stock unless our asset coverage is at least 200% (and at least 150% on and after June 21, 2019 (or on or after such earlier date)). We may also borrow amounts up to 5% of the value of our total assets for temporary or emergency purposes without regard to asset coverage. For a discussion of the risks associated with leverage, see "Risk Factors—Risks Relating to Our Business—Regulations governing our operation as a BDC affect our ability to, and the way in which we, raise additional capital."

GENERAL

              The indenture provides that any debt securities proposed to be sold under this prospectus and the accompanying prospectus supplement ("offered debt securities") and any debt securities issuable upon the exercise of warrants or upon conversion or exchange of other offered securities ("underlying debt securities") may be issued under the indenture in one or more series.

              For purposes of this prospectus, any reference to the payment of principal of or premium or interest, if any, on debt securities will include additional amounts if required by the terms of the debt securities.

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              The indenture does not limit the amount of debt securities that may be issued thereunder from time to time. Debt securities issued under the indenture, when a single trustee is acting for all debt securities issued under the indenture, are called the "indenture securities." The indenture also provides that there may be more than one trustee thereunder, each with respect to one or more different series of indenture securities. See "Resignation of Trustee" below. At a time when two or more trustees are acting under the indenture, each with respect to only certain series, the term "indenture securities" means the one or more series of debt securities with respect to which each respective trustee is acting. In the event that there is more than one trustee under the indenture, the powers and trust obligations of each trustee described in this prospectus will extend only to the one or more series of indenture securities for which it is trustee. If two or more trustees are acting under the indenture, then the indenture securities for which each trustee is acting would be treated as if issued under separate indentures.

              The indenture does not contain any provisions that give you protection in the event we issue a large amount of debt or we are acquired by another entity.

              We refer you to the prospectus supplement for information with respect to any deletions from, modifications of or additions to the Events of Default or our covenants that are described below, including any addition of a covenant or other provision providing event risk or similar protection.

              We have the ability to issue indenture securities with terms different from those of indenture securities previously issued and, without the consent of the holders thereof, to reopen a previous issue of a series of indenture securities and issue additional indenture securities of that series unless the reopening was restricted when that series was created.

              We expect that we will usually issue debt securities in book entry only form represented by global securities.

CONVERSION AND EXCHANGE

              If any debt securities are convertible into or exchangeable for other securities, the prospectus supplement will explain the terms and conditions of the conversion or exchange, including the conversion price or exchange ratio (or the calculation method), the conversion or exchange period (or how the period will be determined), if conversion or exchange will be mandatory or at the option of the holder or us, provisions for adjusting the conversion price or the exchange ratio and provisions affecting conversion or exchange in the event of the redemption of the underlying debt securities. These terms may also include provisions under which the number or amount of other securities to be received by the holders of the debt securities upon conversion or exchange would be calculated according to the market price of the other securities as of a time stated in the prospectus supplement.

PAYMENT AND PAYING AGENTS

              We will pay interest to the person listed in the applicable trustee's records as the owner of the debt security at the close of business on a particular day in advance of each due date for interest, even if that person no longer owns the debt security on the interest due date. That day, usually about two weeks in advance of the interest due date, is called the "record date." Because we will pay all the interest for an interest period to the holders on the record date, holders buying and selling debt securities must work out between themselves the appropriate purchase price. The most common manner is to adjust the sales price of the debt securities to prorate interest fairly between buyer and seller based on their respective ownership periods within the particular interest period. This prorated interest amount is called "accrued interest."

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Payments on Global Securities

              We will make payments on a global security in accordance with the applicable policies of the depositary as in effect from time to time. Under those policies, we will make payments directly to the depositary, or its nominee, and not to any indirect holders who own beneficial interests in the global security. An indirect holder's right to those payments will be governed by the rules and practices of the depositary and its participants.

Payments on Certificated Securities

              We will make payments on a certificated debt security as follows. We will pay interest that is due on an interest payment date by check mailed on the interest payment date to the holder at his or her address shown on the trustee's records as of the close of business on the regular record date. We will make all payments of principal and premium, if any, by check at the office of the applicable trustee in New York, NY and/or at other offices that may be specified in the prospectus supplement or in a notice to holders against surrender of the debt security.

              Alternatively, if the holder asks us to do so, we will pay any amount that becomes due on the debt security by wire transfer of immediately available funds to an account at a bank in New York City, on the due date. To request payment by wire, the holder must give the applicable trustee or other paying agent appropriate transfer instructions at least 15 business days before the requested wire payment is due. In the case of any interest payment due on an interest payment date, the instructions must be given by the person who is the holder on the relevant regular record date. Any wire instructions, once properly given, will remain in effect unless and until new instructions are given in the manner described above.

Payment When Offices Are Closed

              If any payment is due on a debt security on a day that is not a business day, we will make the payment on the next day that is a business day. Payments made on the next business day in this situation will be treated under the indenture as if they were made on the original due date, except as otherwise indicated in the accompanying prospectus supplement. Such payment will not result in a default under any debt security or the indenture, and no interest will accrue on the payment amount from the original due date to the next day that is a business day.

               Book-entry and other indirect holders should consult their banks or brokers for information on how they will receive payments on their debt securities.

EVENTS OF DEFAULT

              You will have rights if an Event of Default occurs in respect of the debt securities of your series and is not cured, as described later in this subsection.

              The term "Event of Default" in respect of the debt securities of your series means any of the following (unless the prospectus supplement relating to such debt securities states otherwise):

    We do not pay the principal of, or any premium on, a debt security of the series on its due date, and do not cure this default within 5 days.

    We do not pay interest on a debt security of the series when due, and such default is not cured within 30 days.

    We do not deposit any sinking fund payment in respect of debt securities of the series on its due date, and do not cure this default within 5 days.

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    We remain in breach of a covenant in respect of debt securities of the series for 60 days after we receive a written notice of default stating we are in breach. The notice must be sent by either the trustee or holders of at least 25% of the principal amount of debt securities of the series.

    We file for bankruptcy or certain other events of bankruptcy, insolvency or reorganization occur and remain undischarged or unstayed for a period of 60 days.

    On the last business day of each of twenty-four consecutive calendar months, we have an asset coverage of less than 100%.

    Any other Event of Default in respect of debt securities of the series described in the applicable prospectus supplement occurs.

              An Event of Default for a particular series of debt securities does not necessarily constitute an Event of Default for any other series of debt securities issued under the same or any other indenture. The trustee may withhold notice to the holders of debt securities of any default, except in the payment of principal, premium or interest, if it considers the withholding of notice to be in the best interests of the holders.

Remedies if an Event of Default Occurs

              If an Event of Default has occurred and has not been cured, the trustee or the holders of at least 25% in principal amount of the debt securities of the affected series may declare the entire principal amount of all the debt securities of that series to be due and immediately payable. This is called a declaration of acceleration of maturity. In certain circumstances, a declaration of acceleration of maturity may be canceled by the holders of a majority in principal amount of the debt securities of the affected series.

              The trustee is not required to take any action under the indenture at the request of any holders unless the holders offer the trustee reasonable protection from expenses and liability (called an "indemnity") (Section 315 of the Trust Indenture Act of 1939). If reasonable indemnity is provided, the holders of a majority in principal amount of the outstanding debt securities of the relevant series may direct the time, method and place of conducting any lawsuit or other formal legal action seeking any remedy available to the trustee. The trustee may refuse to follow those directions in certain circumstances. No delay or omission in exercising any right or remedy will be treated as a waiver of that right, remedy or Event of Default.

              Before you are allowed to bypass your trustee and bring your own lawsuit or other formal legal action or take other steps to enforce your rights or protect your interests relating to the debt securities, the following must occur:

    You must give your trustee written notice that an Event of Default has occurred and remains uncured.

    The holders of at least 25% in principal amount of all outstanding debt securities of the relevant series must make a written request that the trustee take action because of the default and must offer reasonable indemnity to the trustee against the cost and other liabilities of taking that action.

    The trustee must not have taken action for 60 days after receipt of the above notice and offer of indemnity.

    The holders of a majority in principal amount of the debt securities must not have given the trustee a direction inconsistent with the above notice during that 60 day period.

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              However, you are entitled at any time to bring a lawsuit for the payment of money due on your debt securities on or after the due date.

              Holders of a majority in principal amount of the debt securities of the affected series may waive any past defaults other than:

    the payment of principal, any premium or interest; or

    in respect of a covenant that cannot be modified or amended without the consent of each holder.

               Book-entry and other indirect holders should consult their banks or brokers for information on how to give notice or direction to or make a request of the trustee and how to declare or cancel an acceleration of maturity.

              Each year, we will furnish to each trustee a written statement of certain of our officers certifying that to their knowledge we are in compliance with the indenture and the debt securities, or else specifying any default.

MERGER OR CONSOLIDATION

              Under the terms of the indenture, we are generally permitted to consolidate or merge with another entity. We are also permitted to sell all or substantially all of our assets to another entity. However, unless the prospectus supplement relating to certain debt securities states otherwise, we may not take any of these actions unless all the following conditions are met:

    Where we merge out of existence or sell our assets, the resulting entity must agree to be legally responsible for our obligations under the debt securities.

    Immediately after giving effect to such transaction, no Default or Event of Default shall have happened and be continuing.

    Under the indenture, no merger or sale of assets may be made if as a result any of our property or assets or any property or assets of one of our subsidiaries, if any, would become subject to any mortgage, lien or other encumbrance unless either (a) the mortgage, lien or other encumbrance could be created pursuant to the limitation on liens covenant in the indenture without equally and ratably securing the indenture securities or (b) the indenture securities are secured equally and ratably with or prior to the debt secured by the mortgage, lien or other encumbrance.

    We must deliver certain certificates and documents to the trustee.

    We must satisfy any other requirements specified in the prospectus supplement relating to a particular series of debt securities.

MODIFICATION OR WAIVER

              There are three types of changes we can make to the indenture and the debt securities issued thereunder.

Changes Requiring Your Approval

              First, there are changes that we cannot make to your debt securities without your specific approval. The following is a list of those types of changes:

    change the stated maturity of the principal of or interest on a debt security;

    reduce any amounts due on a debt security;

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    reduce the amount of principal payable upon acceleration of the maturity of a security following a default;

    adversely affect any right of repayment at the holder's option;

    change the place (except as otherwise described in the prospectus or prospectus supplement) or currency of payment on a debt security;

    impair your right to sue for payment;

    adversely affect any right to convert or exchange a debt security in accordance with its terms;

    modify the subordination provisions in the indenture in a manner that is adverse to holders of the debt securities;

    reduce the percentage of holders of debt securities whose consent is needed to modify or amend the indenture;

    reduce the percentage of holders of debt securities whose consent is needed to waive compliance with certain provisions of the indenture or to waive certain defaults;

    modify any other aspect of the provisions of the indenture dealing with supplemental indentures, modification and waiver of past defaults, changes to the quorum or voting requirements or the waiver of certain covenants; and

    change any obligation we have to pay additional amounts.

Changes Not Requiring Approval

              The second type of change does not require any vote by the holders of the debt securities. This type is limited to clarifications and certain other changes that would not adversely affect holders of the outstanding debt securities in any material respect. We also do not need any approval to make any change that affects only debt securities to be issued under the indenture after the change takes effect.

Changes Requiring Majority Approval

              Any other change to the indenture and the debt securities would require the following approval:

    If the change affects only one series of debt securities, it must be approved by the holders of a majority in principal amount of that series.

    If the change affects more than one series of debt securities issued under the same indenture, it must be approved by the holders of a majority in principal amount of all of the series affected by the change, with all affected series voting together as one class for this purpose.

              The holders of a majority in principal amount of all of the series of debt securities issued under an indenture, voting together as one class for this purpose, may waive our compliance with some of our covenants in that indenture. However, we cannot obtain a waiver of a payment default or of any of the matters covered by the bullet points included above under "—Changes Requiring Your Approval."

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Further Details Concerning Voting

              When taking a vote, we will use the following rules to decide how much principal to attribute to a debt security:

    For original issue discount securities, we will use the principal amount that would be due and payable on the voting date if the maturity of these debt securities were accelerated to that date because of a default.

    For debt securities whose principal amount is not known (for example, because it is based on an index), we will use a special rule for that debt security described in the prospectus supplement.

    For debt securities denominated in one or more foreign currencies, we will use the U.S. dollar equivalent.

              Debt securities will not be considered outstanding, and therefore not eligible to vote, if we have deposited or set aside in trust money for their payment or redemption. Debt securities will also not be eligible to vote if they have been fully defeased as described later under "Defeasance—Full Defeasance."

              We will generally be entitled to set any day as a record date for the purpose of determining the holders of outstanding indenture securities that are entitled to vote or take other action under the indenture. If we set a record date for a vote or other action to be taken by holders of one or more series, that vote or action may be taken only by persons who are holders of outstanding indenture securities of those series on the record date and must be taken within eleven months following the record date.

               Book-entry and other indirect holders should consult their banks or brokers for information on how approval may be granted or denied if we seek to change the indenture or the debt securities or request a waiver.

DEFEASANCE

              The following provisions will be applicable to each series of debt securities unless we state in the applicable prospectus supplement that the provisions of covenant defeasance and full defeasance will not be applicable to that series.

Covenant Defeasance

              If certain conditions are satisfied, we can make the deposit described below and be released from some of the restrictive covenants in the indenture under which the particular series was issued. This is called "covenant defeasance." In that event, you would lose the protection of those restrictive covenants but would gain the protection of having money and government securities set aside in trust to repay your debt securities. If applicable, you also would be released from the subordination provisions described under "Indenture Provisions—Subordination" below. In order to achieve covenant defeasance, we must do the following:

    If the debt securities of the particular series are denominated in U.S. dollars, we must deposit in trust for the benefit of all holders of such debt securities a combination of money and U.S. government or U.S. government agency notes or bonds that will generate enough cash to make interest, principal and any other payments on the debt securities on their various due dates.

    We must deliver to the trustee a legal opinion of our counsel confirming that, under current U.S. federal income tax law, we may make the above deposit without causing you

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      to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt securities ourselves at maturity.

              We must deliver to the trustee a legal opinion of our counsel stating that the above deposit does not require registration by us under the Investment Company Act and a legal opinion and officers' certificate stating that all conditions precedent to covenant defeasance have been complied with.

              If we accomplish covenant defeasance, you can still look to us for repayment of the debt securities if there were a shortfall in the trust deposit or the trustee is prevented from making payment. For example, if one of the remaining Events of Default occurred (such as our bankruptcy) and the debt securities became immediately due and payable, there might be a shortfall. Depending on the event causing the default, you may not be able to obtain payment of the shortfall.

Full Defeasance

              If there is a change in U.S. federal tax law, as described below, we can legally release ourselves from all payment and other obligations on the debt securities of a particular series (called "full defeasance") if we put in place the following other arrangements for you to be repaid:

    If the debt securities of the particular series are denominated in U.S. dollars, we must deposit in trust for the benefit of all holders of such debt securities a combination of money and U.S. government or U.S. government agency notes or bonds that will generate enough cash to make interest, principal and any other payments on the debt securities on their various due dates.

    We must deliver to the trustee a legal opinion confirming that there has been a change in current U.S. federal tax law or an IRS ruling that allows us to make the above deposit without causing you to be taxed on the debt securities any differently than if we did not make the deposit and just repaid the debt securities ourselves at maturity. Under current U.S. federal tax law, the deposit and our legal release from the debt securities would be treated as though we paid you your share of the cash and notes or bonds at the time the cash and notes or bonds were deposited in trust in exchange for your debt securities and you would recognize gain or loss on the debt securities at the time of the deposit.

    We must deliver to the trustee a legal opinion of our counsel stating that the above deposit does not require registration by us under the Investment Company Act and a legal opinion and officers' certificate stating that all conditions precedent to defeasance have been complied with.

              If we ever did accomplish full defeasance, as described above, you would have to rely solely on the trust deposit for repayment of the debt securities. You could not look to us for repayment in the unlikely event of any shortfall. Conversely, the trust deposit would most likely be protected from claims of our lenders and other creditors if we ever became bankrupt or insolvent. If applicable, you would also be released from the subordination provisions described later under "Indenture Provisions—Subordination."

FORM, EXCHANGE AND TRANSFER OF CERTIFICATED REGISTERED SECURITIES

              Holders may exchange their certificated securities, if any, for debt securities of smaller denominations or combined into fewer debt securities of larger denominations, as long as the total principal amount is not changed.

              Holders may exchange or transfer their certificated securities, if any, at the office of their trustee. We have appointed the trustee to act as our agent for registering debt securities in the names

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of holders transferring debt securities. We may appoint another entity to perform these functions or perform them ourselves.

              Holders will not be required to pay a service charge to transfer or exchange their certificated securities, if any, but they may be required to pay any tax or other governmental charge associated with the transfer or exchange. The transfer or exchange will be made only if our transfer agent is satisfied with the holder's proof of legal ownership.

              If we have designated additional transfer agents for your debt security, they will be named in your prospectus supplement. We may appoint additional transfer agents or cancel the appointment of any particular transfer agent. We may also approve a change in the office through which any transfer agent acts.

              If any certificated securities of a particular series are redeemable and we redeem less than all the debt securities of that series, we may block the transfer or exchange of those debt securities during the period beginning 15 days before the day we mail the notice of redemption and ending on the day of that mailing, in order to freeze the list of holders to prepare the mailing. We may also refuse to register transfers or exchanges of any certificated securities selected for redemption, except that we will continue to permit transfers and exchanges of the unredeemed portion of any debt security that will be partially redeemed.

RESIGNATION OF TRUSTEE

              Each trustee may resign or be removed with respect to one or more series of indenture securities provided that a successor trustee is appointed to act with respect to these series. In the event that two or more persons are acting as trustee with respect to different series of indenture securities under the indenture, each of the trustees will be a trustee of a trust separate and apart from the trust administered by any other trustee.

INDENTURE PROVISIONS—SUBORDINATION

              Upon any distribution of our assets upon our dissolution, winding up, liquidation or reorganization, the payment of the principal of (and premium, if any) and interest, if any, on any indenture securities denominated as subordinated debt securities is to be subordinated to the extent provided in the indenture in right of payment to the prior payment in full of all Senior Indebtedness (as defined below), but our obligation to you to make payment of the principal of (and premium, if any) and interest, if any, on such subordinated debt securities will not otherwise be affected. In addition, no payment on account of principal (or premium, if any), sinking fund or interest, if any, may be made on such subordinated debt securities at any time unless full payment of all amounts due in respect of the principal (and premium, if any), sinking fund and interest on Senior Indebtedness has been made or duly provided for in money or money's worth.

              In the event that, notwithstanding the foregoing, any payment by us is received by the trustee in respect of subordinated debt securities or by the holders of any of such subordinated debt securities before all Senior Indebtedness is paid in full, the payment or distribution must be paid over to the holders of the Senior Indebtedness or on their behalf for application to the payment of all the Senior Indebtedness remaining unpaid until all the Senior Indebtedness has been paid in full, after giving effect to any concurrent payment or distribution to the holders of the Senior Indebtedness. Subject to the payment in full of all Senior Indebtedness upon this distribution by us, the holders of such subordinated debt securities will be subrogated to the rights of the holders of the Senior Indebtedness to the extent of payments made to the holders of the Senior Indebtedness out of the distributive share of such subordinated debt securities.

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              By reason of this subordination, in the event of a distribution of our assets upon our insolvency, certain of our senior creditors may recover more, ratably, than holders of any subordinated debt securities. The indenture provides that these subordination provisions will not apply to money and securities held in trust under the defeasance provisions of the indenture. "Senior Indebtedness" is defined in the indenture as the principal of (and premium, if any) and unpaid interest on:

    our indebtedness (including indebtedness of others guaranteed by us), whenever created, incurred, assumed or guaranteed, for money borrowed (other than indenture securities issued under the indenture and denominated as subordinated debt securities), unless in the instrument creating or evidencing the same or under which the same is outstanding it is provided that this indebtedness is not senior or prior in right of payment to the subordinated debt securities, and

    renewals, extensions, modifications and refinancings of any of this indebtedness.

              If this prospectus is being delivered in connection with the offering of a series of indenture securities denominated as subordinated debt securities, the accompanying prospectus supplement will set forth the approximate amount of our Senior Indebtedness outstanding as of a recent date.

THE TRUSTEE UNDER THE INDENTURE

              U.S. Bank National Association will serve as the trustee under the indenture.

CERTAIN CONSIDERATIONS RELATING TO FOREIGN CURRENCIES

              Debt securities denominated or payable in foreign currencies may entail significant risks. These risks include the possibility of significant fluctuations in the foreign currency markets, the imposition or modification of foreign exchange controls and potential illiquidity in the secondary market. These risks will vary depending upon the currency or currencies involved and will be more fully described in the applicable prospectus supplement.

BOOK-ENTRY DEBT SECURITIES

              The Depository Trust Company ("DTC"), New York, NY, will act as securities depository for the debt securities. The debt securities will be issued as fully registered securities registered in the name of Cede & Co. (DTC's partnership nominee) or such other name as may be requested by an authorized representative of DTC. One fully registered certificate will be issued for the debt securities, in the aggregate principal amount of such issue, and will be deposited with DTC. If, however, the aggregate principal amount of any issue exceeds $500 million, one certificate will be issued with respect to each $500 million of principal amount, and an additional certificate will be issued with respect to any remaining principal amount of such issue.

              DTC, the world's largest securities depository, is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code, and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. DTC holds and provides asset servicing for over 3.5 million issues of U.S. and non-U.S. equity, corporate and municipal debt issues, and money market instruments from over 100 countries that DTC's participants ("Direct Participants") deposit with DTC. DTC also facilitates the post-trade settlement among Direct Participants of sales and other securities transactions in deposited securities through electronic computerized book-entry transfers and pledges between Direct Participants' accounts. This eliminates the need for physical movement of securities certificates. Direct Participants include both U.S. and non-U.S. securities brokers and dealers, banks,

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trust companies, clearing corporations, and certain other organizations. DTC is a wholly owned subsidiary of The Depository Trust & Clearing Corporation ("DTCC").

              DTCC is the holding company for DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies. DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others such as both U.S. and non-U.S. securities brokers and dealers, banks, trust companies and clearing corporations that clear through or maintain a custodial relationship with a Direct Participant, either directly or indirectly ("Indirect Participants"). DTC has a Standard & Poor's rating of AA+. The DTC Rules applicable to its Participants are on file with the SEC. More information about DTC can be found at www.dtcc.com .

              Purchases of debt securities under the DTC system must be made by or through Direct Participants, which will receive a credit for the debt securities on DTC's records. The ownership interest of each actual purchaser of each security ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect Participants' records. Beneficial Owners will not receive written confirmation from DTC of their purchase. Beneficial Owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the Direct or Indirect Participant through which the Beneficial Owner entered into the transaction. Transfers of ownership interests in the debt securities are to be accomplished by entries made on the books of Direct and Indirect Participants acting on behalf of Beneficial Owners. Beneficial Owners will not receive certificates representing their ownership interests in debt securities, except in the event that use of the book-entry system for the debt securities is discontinued.

              To facilitate subsequent transfers, all debt securities deposited by Direct Participants with DTC are registered in the name of DTC's partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of debt securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual Beneficial Owners of the debt securities; DTC's records reflect only the identity of the Direct Participants to whose accounts such debt securities are credited, which may or may not be the Beneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of their holdings on behalf of their customers.

              Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants to Indirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.

              Redemption notices shall be sent to DTC. If less than all of the debt securities within an issue are being redeemed, DTC's practice is to determine by lot the amount of the interest of each Direct Participant in such issue to be redeemed.

              Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to the debt securities unless authorized by a Direct Participant in accordance with DTC's Procedures. Under its usual procedures, DTC mails an Omnibus Proxy to us as soon as possible after the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those Direct Participants to whose accounts the debt securities are credited on the record date (identified in a listing attached to the Omnibus Proxy).

              Redemption proceeds, distributions, and dividend payments on the debt securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC's practice is to credit Direct Participants' accounts upon DTC's receipt of funds and corresponding detail information from us or the trustee on the payment date in accordance with their respective holdings shown on DTC's records. Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices, as is the case with securities held for the

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accounts of customers in bearer form or registered in "street name," and will be the responsibility of such Participant and not of DTC or its nominee, the trustee, or us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment of redemption proceeds, distributions, and dividend payments to Cede & Co. (or such other nominee as may be requested by an authorized representative of DTC) is the responsibility of us or the trustee, but disbursement of such payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to the Beneficial Owners will be the responsibility of Direct and Indirect Participants.

              DTC may discontinue providing its services as depository with respect to the debt securities at any time by giving reasonable notice to us or the trustee. Under such circumstances, in the event that a successor depository is not obtained, certificates are required to be printed and delivered. We may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor securities depository). In that event, certificates will be printed and delivered to DTC.

              The information in this section concerning DTC and DTC's book-entry system has been obtained from sources that we believe to be reliable, but we take no responsibility for the accuracy thereof.

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DESCRIPTION OF OUR UNITS

              The following is a general description of the terms of the units we may issue from time to time. Particular terms of any units we offer will be described in the prospectus supplement relating to such units. For a complete description of the terms of particular units, you should read this prospectus and the prospectus supplement relating to those particular units.

              We may issue units comprised of one or more of the other securities described in this prospectus in any combination. Each unit may also include debt obligations of third parties, such as U.S. Treasury securities. Each unit will be issued so that the holder of the unit is also the holder of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder of each included security.

              A prospectus supplement will describe the particular terms of any series of units we may issue, including the following:

    the designation and terms of the units and of the securities comprising the units, including whether and under what circumstances the securities comprising the units may be held or transferred separately;

    a description of the terms of any unit agreement governing the units;

    a description of the provisions for the payment, settlement, transfer or exchange of the units; and

    whether the units will be issued in fully registered or global form.

              We will not offer any units under this prospectus or an accompanying prospectus supplement without first filing a new post-effective amendment to the registration statement.

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SALES OF COMMON STOCK BELOW NET ASSET VALUE

              Pursuant to approval granted at a special meeting of stockholders held on May 14, 2018, we were permitted to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors. Such stockholder approval expired on May 14, 2019. On April 10, 2019, we filed the 2019 Special Meeting Proxy Statement for a special meeting of the stockholders, currently expected to take place on June 10, 2019. The 2019 Special Meeting Proxy Statement sets forth a proposal to be voted upon at the special meeting that, if approved by stockholders, would authorize us to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors, for a twelve-month period expiring on the one-year anniversary of the date of the special meeting.

              In order to sell shares of common stock pursuant to this authorization, no additional authorization from our stockholders has to be solicited, but a majority of our directors who have no financial interest in the sale and a majority of our independent directors must (a) find that the sale is in our best interests and in the best interests of our stockholders and (b) in consultation with any underwriter or underwriters of the offering, make a good faith determination as of a time either immediately prior to the first solicitation by us or on our behalf of firm commitments to purchase such shares of common stock, or immediately prior to the issuance of such common stock, that the price at which such shares of common stock are to be sold is not less than a price that closely approximates the market value of those shares of common stock, less any distributing commission or discount.

              In making a determination that an offering of common stock below its net asset value per share is in our and our stockholders' best interests, our board of directors will consider a variety of factors including:

    the effect that an offering below net asset value per share would have on our stockholders, including the potential dilution to the net asset value per share of our common stock our stockholders would experience as a result of the offering;

    the amount per share by which the offering price per share and the net proceeds per share are less than our most recently determined net asset value per share;

    the relationship of recent market prices of par common stock to net asset value per share and the potential impact of the offering on the market price per share of our common stock;

    whether the estimated offering price would closely approximate the market value of shares of our common stock;

    the potential market impact of being able to raise capital during the current financial market difficulties;

    the nature of any new investors anticipated to acquire shares of our common stock in the offering;

    the anticipated rate of return on and quality, type and availability of investments; and

    the leverage available to us.

              Our board of directors will also consider the fact that sales of shares of common stock at a discount will benefit our investment adviser as our investment adviser will earn additional investment management fees on the proceeds of such offerings, as it would from the offering of any other of our securities or from the offering of common stock at premium to net asset value per share.

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              We will not sell shares of our common stock pursuant to stockholder approval (or any rights, warrants or units to purchase shares of our common stock) under this prospectus or an accompanying prospectus supplement without first filing a new post-effective amendment to the registration statement if the cumulative dilution to our net asset value per share from offerings under the registration statement, as amended by such post-effective amendment, exceeds 15%. This would be measured separately for each offering pursuant to the registration statement, as amended by this post-effective amendment, by calculating the percentage dilution or accretion to aggregate net asset value from that offering and then summing the percentage from each offering. For example, if our most recently determined net asset value per share at the time of the first offering is $15.00 and we have 30 million shares of common stock outstanding, the sale of 6 million shares of common stock at net proceeds to us of $7.50 per share (a 50% discount) would produce dilution of 8.33%. If we subsequently determined that our net asset value per share increased to $15.75 on the then 36 million shares of common stock outstanding and then made an additional offering, we could, for example, sell approximately an additional 7.2 million shares of common stock at net proceeds to us of $9.45 per share, which would produce dilution of 6.67%, before we would reach the aggregate 15% limit.

              Sales by us of our common stock at a discount from net asset value per share pose potential risks for our existing stockholders whether or not they participate in the offering, as well as for new investors who participate in the offering. Any sale of common stock at a price below net asset value per share would result in an immediate dilution to existing common stockholders who do not participate in such sale on at least a pro rata basis. See "Risk Factors—Risks Relating to Offerings Pursuant to this Prospectus—The net asset value per share of our common stock may be diluted if we sell shares of our common stock in one or more offerings at prices below the then current net asset value per share of our common stock or securities to subscribe for or convertible into shares of our common stock."

              The following three headings and accompanying tables explain and provide hypothetical examples on the impact of an offering of our common stock at a price less than net asset value per share on three different types of investors:

    existing stockholders who do not purchase any shares in the offering;

    existing stockholders who purchase a relatively small amount of shares in the offering or a relatively large amount of shares in the offering; and

    new investors who become stockholders by purchasing shares in the offering.

Impact on Existing Stockholders Who Do Not Participate in the Offering

              Our existing stockholders who do not participate in an offering below net asset value per share or who do not buy additional shares in the secondary market at the same or lower price as we obtain in the offering (after expenses and commissions) face the greatest potential risks. These stockholders will experience an immediate dilution in the net asset value of the shares of common stock they hold and their net asset value per share. These stockholders will also experience a disproportionately greater decrease in their participation in our earnings and assets and their voting power than the increase we will experience in our assets, potential earning power and voting interests due to such offering. These stockholders may also experience a decline in the market price of their shares, which often reflects to some degree announced or potential increases and decreases in net asset value per share. This decrease could be more pronounced as the size of the offering and level of discounts increases. Further, if current stockholders do not purchase any shares to maintain their percentage interest, regardless of whether such offering is above or below the then current net asset value, their voting power will be diluted.

              The following chart illustrates the level of net asset value dilution that would be experienced by a nonparticipating stockholder in three different hypothetical offerings of different sizes and levels of

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discount from net asset value per share. It is not possible to predict the level of market price decline that may occur.

              The examples assume that the issuer has 30 million shares outstanding, $600 million in total assets and $150 million in total liabilities. The current net asset value and net asset value per share are thus $450 million and $15.00. The chart illustrates the dilutive effect on Stockholder A of (a) an offering of 1.5 million shares of common stock (5% of the outstanding shares) at $14.25 per share after offering expenses and commissions (a 5% discount from net asset value), (b) an offering of 3 million shares of common stock (10% of the outstanding shares) at $13.50 per share after offering expenses and commissions (a 10% discount from net asset value), (c) an offering of 6 million shares of common stock (20% of the outstanding shares) at $12.00 per share after offering expenses and commissions (a 20% discount from net asset value) and (d) an offering of 7.5 million shares of common stock (25% of the outstanding shares) at $11.25 per share after offering expenses and commissions (a 25% discount from net asset value). The prospectus supplement pursuant to which any discounted offering is made will include a chart based on the actual number of shares of common stock in such offering and the actual discount to the most recently determined net asset value. It is not possible to predict the level of market price decline that may occur.

 
   
  Example 1   Example 2   Example 3   Example 4  
 
   
  5% Offering at
5% Discount
  10% Offering at
10% Discount
  20% Offering at
20% Discount
  25% Offering at
25% Discount
 
 
  Prior to Sale
Below NAV
  Following
Sale
  %
Change
  Following
Sale
  %
Change
  Following
Sale
  %
Change
  Following
Sale
  %
Change
 

Offering Price

                                                       

Price per Share to Public

        $ 15.00       $ 14.21       $ 12.63       $ 11.84      

Net Proceeds per Share to Issuer

        $ 14.25       $ 13.50       $ 12.00       $ 11.25      

Decrease to Net Asset Value

                                                       

Total Shares Outstanding

    30,000,000     31,500,000     5.00 %   33,000,000     10.00 %   36,000,000     20.00 %   37,500,000     25.00 %

Net Asset Value per Share

  $ 15.00   $ 14.96     (0.24 )% $ 14.86     (0.91 )% $ 14.50     (3.33 )% $ 14.25     (5.00 )%

Dilution to Nonparticipating Stockholder

                                                       

Shares Held by Stockholder A

    30,000     30,000     0.00 %   30,000     0.00 %   30,000     0.00 %   30,000     0.00 %

Percentage Held by Stockholder A

    0.10 %   0.10 %   (4.76 )%   0.09 %   (9.09 )%   0.08 %   (16.67 )%   0.08 %   (20.00 )%

Total Net Asset Value Held by Stockholder A

  $ 450,000   $ 448,929     (0.24 )% $ 445,909     (0.91 )% $ 435,000     (3.33 )% $ 427,500     (5.00 )%

Total Investment by Stockholder A (Assumed to Be $15.00 per Share)

  $ 450,000   $ 450,000         $ 450,000         $ 450,000         $ 450,000        

Total Dilution to Stockholder A (Total Net Asset Value Less Total Investment)

        $ (1,071 )       $ (4,091 )       $ (15,000 )       $ (22,500 )      

Investment per Share Held by Stockholder A (Assumed to be $15.00 per Share on Shares Held Prior to Sale)

  $ 15.00   $ 15.00     0.00 % $ 15.00     0.00 % $ 15.00     0.00 % $ 15.00     0.00 %

Net Asset Value per Share Held by Stockholder A

        $ 14.96         $ 14.86         $ 14.50         $ 14.50        

Dilution per Share Held by Stockholder A (Net Asset Value per Share Less Investment per Share)

        $ (0.04 )       $ (0.14 )       $ (0.50 )       $ (0.75 )      

Percentage Dilution to Stockholder A (Dilution per Share Divided by Investment per Share)

                (0.24 )%         (0.91 )%         (3.33 )%         (5.00 )%

Impact on Existing Stockholders Who Do Participate in the Offering

              Our existing stockholders who participate in an offering below net asset value per share or who buy additional shares in the secondary market at the same or lower price as we obtain in the offering (after expenses and commissions) will experience the same types of net asset value dilution as the nonparticipating stockholders, although at a lower level, to the extent they purchase less than the same

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percentage of the discounted offering as their interest in shares of our common stock immediately prior to the offering. The level of net asset value dilution will decrease as the number of shares such stockholders purchase increases. Existing stockholders who buy more than such percentage will experience net asset value dilution but will, in contrast to existing stockholders who purchase less than their proportionate share of the offering, experience accretion in net asset value per share over their investment per share and will also experience a disproportionately greater increase in their participation in our earnings and assets and their voting power than our increase in assets, potential earning power and voting interests due to such offering. The level of accretion will increase as the excess number of shares such stockholder purchases increases. Even a stockholder who over-participates will, however, be subject to the risk that we may make additional discounted offerings in which such stockholder does not participate, in which case such a stockholder will experience net asset value dilution as described above in such subsequent offerings. These stockholders may also experience a decline in the market price of their shares, which often reflects to some degree announced or potential increases and decreases in net asset value per share. This decrease could be more pronounced as the size of the offering and level of discounts increases.

              The following chart illustrates the level of dilution and accretion in the hypothetical 20% discount offering from the prior chart (Example 3) for a stockholder that acquires shares equal to (a) 50% of its proportionate share of the offering (i.e., 3,000 shares, which is 0.05% of an offering of 6 million shares) rather than its 0.10% proportionate share and (b) 150% of such percentage (i.e., 9,000 shares, which is 0.15% of an offering of 6 million shares rather than its 0.10% proportionate share). The prospectus supplement pursuant to which any discounted offering is made will include a chart for these examples based on the actual number of shares in such offering and the actual discount from the most recently determined net asset value per share. It is not possible to predict the level of market price decline that may occur.

 
   
  50% Participation   150% Participation  
 
  Prior to Sale
Below NAV
  Following
Sale
  %
Change
  Following
Sale
  %
Change
 

Offering Price

                               

Price per Share to Public

        $ 12.63         $ 12.63        

Net Proceeds per Share to Issuer

        $ 12.00         $ 12.00        

Decrease/Increase to Net Asset Value

                               

Total Shares Outstanding

    30,000,000     36,000,000     20 %   36,000,000     20 %

Net Asset Value per Share

  $ 15.00   $ 14.50     (3.33 )% $ 14.50     (3.33 )%

Dilution/Accretion to Participating Stockholder Shares Held by Stockholder A

    30,000     33,000     10 %   39,000     30 %

Percentage Held by Stockholder A

    0.10 %   0.09 %   (8.33 )%   0.11 %   8.33 %

Total Net Asset Value Held by Stockholder A

  $ 450,000   $ 478,500     6.33 % $ 565,500     25.67 %

Total Investment by Stockholder A (Assumed to be $15.00 per Share on Shares Held Prior to Sale)

        $ 487,895         $ 563,684        

Total Dilution/Accretion to Stockholder A (Total Net Asset Value Less Total Investment)

        $ (9,395 )       $ 1,816        

Investment per Share Held by Stockholder A (Assumed to Be $15.00 on Shares Held Prior to Sale)

  $ 15.00   $ 14.78     (1.44 )% $ 14.45     (3.64 )%

Net Asset Value per Share Held by Stockholder A

        $ 14.50         $ 14.50        

Dilution/Accretion per Share Held by Stockholder A (Net Asset Value per Share Less Investment per Share)

        $ (0.28 )       $ 0.05     0.40 %

Percentage Dilution/Accretion to Stockholder A (Dilution per Share Divided by Investment per Share)

                (1.96 )%         0.32 %

Impact on New Investors

              Investors who are not currently stockholders and who participate in an offering of shares of our common stock below net asset value, but whose investment per share is greater than the resulting net asset value per share due to selling compensation and expenses paid by us, will experience an

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immediate decrease, although small, in the net asset value of their shares and their net asset value per share compared to the price they pay for their shares. Investors who are not currently stockholders and who participate in an offering of shares of our common stock below net asset value per share and whose investment per share is also less than the resulting net asset value per share due to selling compensation and expenses paid by us being significantly less than the discount per share, will experience an immediate increase in the net asset value of their shares and their net asset value per share compared to the price they pay for their shares. These investors will experience a disproportionately greater participation in our earnings and assets and their voting power than our increase in assets, potential earning power and voting interests due to such offering. These investors will, however, be subject to the risk that we may make additional discounted offerings in which such new stockholder does not participate, in which case such new stockholder will experience dilution as described above in such subsequent offerings. These investors may also experience a decline in the market price of their shares, which often reflects to some degree announced or potential increases and decreases in net asset value per share. This decrease could be more pronounced as the size of the offering and level of discounts increases.

              The following chart illustrates the level of dilution or accretion for new investors that would be experienced by a new investor in the same hypothetical 5%, 10%, 20% and 25% discounted offerings as described in the first chart above. The illustration is for a new investor who purchases the same percentage (0.10%) of the shares in the offering as Stockholder A in the prior examples held immediately prior to the offering. The prospectus supplement pursuant to which any discounted offering is made will include a chart for these examples based on the actual number of shares in such

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offering and the actual discount from the most recently determined net asset value per share. It is not possible to predict the level of market price decline that may occur.

 
   
  Example 1   Example 2   Example 3   Example 4  
 
   
  5% Offering at
5% Discount
  10% Offering at
10% Discount
  20% Offering at
20% Discount
  25% Offering at
25% Discount
 
 
  Prior to Sale
Below NAV
  Following
Sale
  %
Change
  Following
Sale
  %
Change
  Following
Sale
  %
Change
  Following
Sale
  %
Change
 

Offering Price

                                                       

Price per Share to Public

        $ 15.00         $ 14.21         $ 12.63         $ 11.84        

Net Proceeds per Share to Issuer

        $ 14.25         $ 13.50         $ 12.00         $ 11.25        

Decrease/Increase to Net Asset Value

                                                       

Total Shares Outstanding

    30,000,000     31,500,000     5 %   33,000,000     10 %   36,000,000     20 %   37,500,000     25.00 %

Net Asset Value per Share

  $ 15.00   $ 14.96     (0.24 )% $ 14.86     (0.91 )% $ 14.50     (3.33 )% $ 14.25     (5.00 )%

Dilution/Accretion to New Investor A

                                                       

Shares Held by Investor A

    0     1,500           3,000           6,000           7,500        

Percentage Held by Investor A

    0.00 %   0.00 %         0.01 %         0.02 %         0.02 %      

Total Net Asset Value Held by Investor A

  $ 0   $ 22,446         $ 44,591         $ 87,000         $ 106,875        

Total Investment by Investor A (At Price to Public)

        $ 22,500         $ 42,632         $ 75,789         $ 88,816        

Total Dilution/Accretion to Investor A (Total Net Asset Value Less Total Investment)

        $ (54 )       $ 1,959         $ 11,211         $ 18,059        

Investment per Share Held by Investor A

  $ 0   $ 15.00         $ 14.21         $ 12.63         $ 11.84        

Net Asset Value per Share Held by Investor A

        $ 14.96         $ 14.86         $ 14.50         $ 14.25        

Dilution/Accretion per Share Held by Investor A (Net Asset Value per Share Less Investment per Share)

        $ (0.04 )       $ 0.65         $ 1.87         $ 2.41        

Percentage Dilution/Accretion to Investor A (Dilution per Share Divided by Investment per Share)

                (0.24 )%         4.60 %         14.79 %         20.33 %

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ISSUANCE OF WARRANTS OR SECURITIES TO SUBSCRIBE FOR
OR CONVERTIBLE INTO SHARES OF OUR COMMON STOCK

              At our 2008 annual stockholders meeting, our stockholders approved our ability to sell or otherwise issue warrants or securities to subscribe for or convertible into shares of our common stock, not exceeding 25% of our then outstanding common stock, at an exercise or conversion price that, at the date of issuance, will not be less than the greater of the market value per share of our common stock and the net asset value per share of our common stock. The authorization granted to sell or otherwise issue warrants or securities to subscribe for or convertible into shares of our common stock has no expiration. Any exercise of warrants or securities to subscribe for or convertible into shares of our common stock at an exercise or conversion price that is below net asset value at the time of such exercise or conversion would result in an immediate dilution to existing common stockholders. This dilution would include reduction in net asset value as a result of the proportionately greater decrease in the stockholders' interest in our earnings and assets and their voting interest than the increase in our assets resulting from such offering.

              As a result of obtaining this authorization, in order to sell or otherwise issue such securities, (a) the exercise, conversion or subscription rights in such securities must expire by their terms within 10 years, (b) with respect to any warrants, options or rights to subscribe or convert to our common stock that are issued along with other securities, such warrants, options or rights must not be separately transferable, (c) the exercise or conversion price of such securities must not be less than the greater of the market value per share of our common stock and the net asset value per share of our common stock at the date of issuance of such securities, (d) the issuance of such securities must be approved by a majority of the board of directors who have no financial interest in the transaction and a majority of the independent directors on the basis that such issuance is in the best interests of the Company and its stockholders and (e) the number of shares of our common stock that would result from the exercise or conversion of such securities and all other securities convertible, exercisable or exchangeable into shares of our common stock outstanding at the time of issuance of such securities must not exceed 25% of our outstanding common stock at such time.

              We could also sell shares of common stock below net asset value per share in certain other circumstances, including through subscription rights issued in rights offerings. See "Description of Our Subscription Rights" and "Risk Factors—Risks Relating to Offerings Pursuant to this Prospectus—Your interest in us may be diluted if you do not fully exercise your subscription rights in any rights offering. In addition, if the subscription price is less than our net asset value per share, then you will experience an immediate dilution of the aggregate net asset value of your shares."

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REGULATION

              We have elected to be regulated as a BDC under the Investment Company Act and have elected to be treated as a RIC under the Code. As with other companies regulated by the Investment Company Act, a BDC must adhere to certain substantive regulatory requirements. The Investment Company Act contains prohibitions and restrictions relating to certain transactions between BDCs and certain affiliates (including any investment advisers or sub-advisers), principal underwriters and certain affiliates of those affiliates or underwriters. Among other things, we generally cannot co-invest in any portfolio company in which a fund managed by Ares or any of its downstream affiliates (other than us and our downstream affiliates) is also co-investing. On January 18, 2017, we received an order from the SEC that permits us and other business development companies and registered closed-end management investment companies managed by Ares to co-invest in portfolio companies with each other and with affiliated investment funds. Co-investments made under the Co-investment Exemptive Order are subject to compliance with certain conditions and other requirements contained in the Co-investment Exemptive Order, which could limit our ability to participate in a co-investment transaction. We may also otherwise co-invest with funds managed by Ares or any of its downstream affiliates, subject to compliance with existing regulatory guidance, applicable regulations and our allocation procedures.

              The Investment Company Act contains certain restrictions on certain types of investments we may make. Specifically, we may only invest up to 30% of our portfolio in entities that are not considered "eligible portfolio companies" (as defined in the Investment Company Act), including companies located outside of the United States, entities that are operating pursuant to certain exceptions under the Investment Company Act, and publicly traded entities whose public equity market capitalization exceeds the levels provided for under the Investment Company Act.

              The Investment Company Act also requires that a majority of our directors be persons other than "interested persons," as that term is defined in Section 2(a)(19) of the Investment Company Act, referred to herein as "independent directors." In addition, the Investment Company Act provides that we may not change the nature of our business so as to cease to be, or to withdraw our election as, a BDC unless that change is approved by holders of at least a majority of our outstanding voting securities. Under the Investment Company Act, the vote of holders of at least a "majority of outstanding voting securities" means the vote of the holders of the lesser of: (a) 67% or more of the outstanding shares of our common stock present at a meeting or represented by proxy if holders of more than 50% of the shares of our common stock are present or represented by proxy or (b) more than 50% of the outstanding shares of our common stock.

              Under the Investment Company Act, we are not generally able to issue and sell our common stock at a price below net asset value per share. We may, however, sell our common stock, or warrants, options or rights to acquire our common stock, at a price below the current net asset value per share of our common stock if our board of directors determines that such sale is in our best interests and the best interests of our stockholders, and our stockholders approve such sale. Pursuant to approval granted at a special meeting of stockholders held on May 14, 2018, we were permitted to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors. Such stockholder approval expired on May 14, 2019. On April 10, 2019, we filed the 2019 Special Meeting Proxy Statement for a special meeting of the stockholders, currently expected to take place on June 10, 2019. The 2019 Special Meeting Proxy Statement sets forth a proposal to be voted upon at the special meeting that, if approved by stockholders, would authorize us to sell or otherwise issue shares of our common stock at a price below net asset value, subject to certain limitations and determinations that must be made by our board of directors, for a twelve-month period expiring on the one-year anniversary of the date of the special meeting.

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              We may invest up to 100% of our assets in securities acquired directly from issuers in privately negotiated transactions. Our intention is to not write (sell) or buy put or call options to manage risks associated with the publicly traded securities of our portfolio companies. We may enter into hedging transactions to manage the risks associated with interest rate and currency fluctuations. We may purchase or otherwise receive warrants or options to purchase the common stock of our portfolio companies in connection with acquisition financings or other investments. In connection with such an acquisition, we may acquire rights to require the issuers of acquired securities or their affiliates to repurchase them under certain circumstances. We also do not intend to acquire securities issued by any investment company that exceed the limits imposed by the Investment Company Act. Under these limits, we generally cannot acquire more than 3% of the voting stock of any investment company (as defined in the Investment Company Act), invest more than 5% of the value of our total assets in the securities of one investment company or invest more than 10% of the value of our total assets in the securities of investment companies in the aggregate. With regard to that portion of our portfolio invested in securities issued by investment companies, it should be noted that such investments might subject our stockholders to additional expenses.

              We are currently allowed to borrow amounts or issue debt securities or preferred stock, which we refer to collectively as "senior securities," such that our asset coverage, as calculated pursuant to the Investment Company Act, equals at least 200% immediately after such borrowing. On June 21, 2018, our board of directors, including a "required majority" of our board of directors, approved the application of the modified asset coverage requirement set forth in Section 61(a)(2) of the Investment Company Act, as amended by the SBCAA. As a result, effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us).

QUALIFYING ASSETS

              A BDC must have been organized and have its principal place of business in the United States and must be operated for the purpose of making investments in the types of securities described in (1), (2) or (3) below. Thus, under the Investment Company Act, a BDC may not acquire any asset other than assets of the type listed in Section 55(a) of the Investment Company Act, which are referred to as qualifying assets, unless, at the time the acquisition is made, qualifying assets represent at least 70% of the company's total assets. The principal categories of qualifying assets relevant to our business are the following:

    (1)
    Securities purchased in transactions not involving any public offering from the issuer of such securities, which issuer (subject to certain limited exceptions):

    (a)
    is an eligible portfolio company, or from any person who is, or has been during the preceding 13 months, an affiliated person of an eligible portfolio company, or from any other person, subject to such rules as may be prescribed by the SEC. An eligible portfolio company is defined in the Investment Company Act as any issuer that:

    (i)
    is organized under the laws of, and has its principal place of business in, the United States;

    (ii)
    is not an investment company (other than a small business investment company wholly owned by the BDC) or a company that would be an investment company but for certain exclusions under the Investment Company Act; and

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        (iii)
        does not have any class of securities listed on a national securities exchange;

      (b)
      is a company that meets the requirements of (a)(i) and (ii) above, but is not an eligible portfolio company because it has issued a class of securities on a national securities exchange, if:

      (i)
      at the time of the purchase, we own at least 50% of the (x) greatest number of equity securities of such issuer and securities convertible into or exchangeable for such securities; and (y) the greatest amount of debt securities of such issuer, held by us at any point in time during the period when such issuer was an eligible portfolio company; and

      (ii)
      we are one of the 20 largest holders of record of such issuer's outstanding voting securities; or

      (c)
      is a company that meets the requirements of (a)(i) and (ii) above, but is not an eligible portfolio company because it has issued a class of securities on a national securities exchange, if the aggregate market value of such company's outstanding voting and non-voting common equity is less than $250 million.

    (2)
    Securities of any eligible portfolio company that we control.

    (3)
    Securities purchased in a private transaction from a U.S. issuer that is not an investment company or from an affiliated person of the issuer, or in transactions incident thereto, if the issuer is in bankruptcy and subject to reorganization or if the issuer, immediately prior to the purchase of its securities, was unable to meet its obligations as they came due without material assistance other than conventional lending or financing arrangements.

    (4)
    Securities of an eligible portfolio company purchased from any person in a private transaction if there is no ready market for such securities and we already own 60% of the outstanding equity of the eligible portfolio company.

    (5)
    Securities received in exchange for or distributed on or with respect to securities described in (1) through (4) above, or pursuant to the exercise of warrants or rights relating to such securities.

    (6)
    Cash, cash items, U.S. Government securities or high-quality debt securities maturing in one year or less from the time of investment.

MANAGERIAL ASSISTANCE TO PORTFOLIO COMPANIES

              BDCs generally must offer to make available to the issuer of portfolio securities significant managerial assistance, by either offering, and providing if accepted, significant guidance and counsel concerning the management operations or business objectives of the portfolio company or by exercising a controlling influence over the management or policies of a portfolio company, except in circumstances where either (i) the BDC does not treat such issuer of securities as an eligible portfolio company, or (ii) the BDC purchases such securities in conjunction with one or more other persons acting together and one of the other persons in the group makes available such managerial assistance.

TEMPORARY INVESTMENTS

              Pending investment in other types of "qualifying assets," as described above, our investments may consist of cash, cash items, U.S. Government securities or high-quality debt securities maturing in one year or less from the time of investment, which we refer to, collectively, as "temporary investments," so that 70% of our assets are qualifying assets. Typically, we will invest in U.S. Treasury

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bills or in repurchase agreements, provided that such agreements are fully collateralized by cash or securities issued by the U.S. Government or its agencies. A repurchase agreement involves the purchase by an investor, such as us, of a specified security and the simultaneous agreement by the seller to repurchase it at an agreed-upon future date and at a price that is greater than the purchase price by an amount that reflects an agreed-upon interest rate. There is no percentage restriction on the proportion of our assets that may be invested in such repurchase agreements. However, if more than 25% of our total assets constitute repurchase agreements from a single counterparty, we may not meet the Diversification Tests in order to qualify as a RIC. Thus, we do not intend to enter into repurchase agreements with a single counterparty in excess of this limit. Our investment adviser will monitor the creditworthiness of the counterparties with which we enter into repurchase agreement transactions.

INDEBTEDNESS AND SENIOR SECURITIES

              We are currently permitted, under specified conditions, to issue multiple classes of indebtedness and one class of stock senior to our common stock if our asset coverage, calculated pursuant to the Investment Company Act, is at least equal to 200% immediately after each such issuance. Effective on June 21, 2019, our asset coverage requirement applicable to senior securities will be reduced from 200% to 150% (i.e., the revised regulatory leverage limitation permits BDCs to double the amount of borrowings, such that we would be able to borrow up to two dollars for every dollar we have in assets less all liabilities and indebtedness not represented by senior securities issued by us). In addition, while certain types of indebtedness and senior securities remain outstanding, we may be required to make provisions to prohibit distributions to our stockholders or the repurchase of such securities or shares unless we meet the applicable asset coverage ratios at the time of the distribution or repurchase. Specifically, prior to June 21, 2019 (or such earlier date), we may be precluded from declaring dividends or repurchasing shares of our common stock unless our asset coverage is at least 200% (and at least 150% on and after June 21, 2019 (or on or after such earlier date)). We may also borrow amounts up to 5% of the value of our total assets for temporary or emergency purposes without regard to asset coverage. For a discussion of the risks associated with leverage, see "Risk Factors—Risks Relating to Our Business—Regulations governing our operation as a BDC affect our ability to, and the way in which we, raise additional capital."

CODE OF ETHICS

              We and Ares Capital Management have each adopted a code of ethics pursuant to Rule 17j-1 under the Investment Company Act that establishes procedures for personal investments and restricts certain personal securities transactions. Personnel subject to each code may invest in securities for their personal investment accounts, including securities that may be purchased or held by us, so long as such investments are made in accordance with the code's requirements. Our code of ethics is filed as an exhibit to our registration statement of which this prospectus is a part. For information on how to obtain a copy of the code of ethics, see "Available Information."

PROXY VOTING POLICIES AND PROCEDURES

              SEC-registered advisers that have the authority to vote (client) proxies (which authority may be implied from a general grant of investment discretion) are required to adopt policies and procedures reasonably designed to ensure that the adviser votes proxies in the best interests of its clients. Registered advisers also must maintain certain records on proxy voting. In most cases, we invest in securities that do not generally entitle us to voting rights in our portfolio companies. When we do have voting rights, we delegate the exercise of such rights to Ares Capital Management. Ares Capital Management's proxy voting policies and procedures are summarized below:

              In determining how to vote, officers of our investment adviser consult with each other and other investment professionals of Ares, taking into account our and our investors' interests as well as

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any potential conflicts of interest. Our investment adviser consults with legal counsel to identify potential conflicts of interest. Where a potential conflict of interest exists, our investment adviser may, if it so elects, resolve it by following the recommendation of a disinterested third party, by seeking the direction of our independent directors or, in extreme cases, by abstaining from voting. While our investment adviser may retain an outside service to provide voting recommendations and to assist in analyzing votes, our investment adviser will not delegate its voting authority to any third party.

              An officer of Ares Capital Management keeps a written record of how all such proxies are voted. Our investment adviser retains records of (a) proxy voting policies and procedures, (b) all proxy statements received (or it may rely on proxy statements filed on the SEC's EDGAR system in lieu thereof), (c) all votes cast, (d) investor requests for voting information and (e) any specific documents prepared or received in connection with a decision on a proxy vote. If it uses an outside service, our investment adviser may rely on such service to maintain copies of proxy statements and records, so long as such service will provide a copy of such documents promptly upon request.

              Our investment adviser's proxy voting policies are not exhaustive and are designed to be responsive to the wide range of issues that may be subject to a proxy vote. In general, our investment adviser votes our proxies in accordance with these guidelines unless: (a) it has determined otherwise due to the specific and unusual facts and circumstances with respect to a particular vote, (b) the subject matter of the vote is not covered by these guidelines, (c) a material conflict of interest is present or (d) our investment adviser finds it necessary to vote contrary to its general guidelines to maximize stockholder value or the best interests of Ares Capital. In reviewing proxy issues, our investment adviser generally uses the following guidelines:

              Elections of Directors:     In general, our investment adviser will vote proxies in favor of the management-proposed slate of directors. If there is a proxy fight for seats on a portfolio company's board of directors, or our investment adviser determines that there are other compelling reasons for withholding our vote, it will determine the appropriate vote on the matter. Our investment adviser may withhold votes for directors when it (a) believes a direct conflict of interest exists between the interests of the director and the stockholders, (b) concludes that the actions of the director are unlawful, unethical or negligent or (c) believes the board is entrenched in or dealing inadequately with performance problems, and/or acting with insufficient independence between the board and management. Finally, our investment adviser may withhold votes for directors of non-U.S. issuers where there is insufficient information about the nominees disclosed in the proxy statement.

              Appointment of Auditors:     We believe that a portfolio company remains in the best position to choose its independent auditors and our investment adviser will generally support management's recommendation in this regard.

              Changes in Capital Structure:     Changes in a portfolio company's charter or bylaws may be required by state or federal regulation. In general, our investment adviser will cast our votes in accordance with the management on such proposals. However, our investment adviser will consider carefully any proposal regarding a change in corporate structure that is not required by state or federal regulation.

              Corporate Restructurings, Mergers and Acquisitions:     We believe proxy votes dealing with corporate reorganizations are an extension of the investment decision. Accordingly, our investment adviser will analyze such proposals on a case-by-case basis and vote in accordance with its perception of our interests.

              Proposals Affecting Stockholder Rights:     We will generally vote in favor of proposals that give stockholders a greater voice in the affairs of a portfolio company and oppose any measure that seeks to limit such rights. However, when analyzing such proposals, our investment adviser will balance the

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financial impact of the proposal against any impairment of stockholder rights as well as of our investment in the portfolio company.

              Corporate Governance:     We recognize the importance of good corporate governance. Accordingly, our investment adviser will generally favor proposals that promote transparency and accountability within a portfolio company.

              Anti-Takeover Measures:     Our investment adviser will evaluate, on a case-by-case basis, any proposals regarding anti-takeover measures to determine the measure's likely effect on stockholder value dilution.

              Stock Splits:     Our investment adviser will generally vote with management on stock split matters.

              Limited Liability of Directors:     Our investment adviser will generally vote with management on matters that could adversely affect the limited liability of directors.

              Social and Corporate Responsibility:     Our investment adviser will review proposals related to social, political and environmental issues to determine whether they may adversely affect stockholder value. Our investment adviser may abstain from voting on such proposals where they do not have a readily determinable financial impact on stockholder value.

              Stockholders may obtain information regarding how we voted proxies with respect to our portfolio securities during the twelve-month period ended December 31, 2018 free of charge by making a written request for proxy voting information to our Investor Relations Department at Ares Capital Corporation, 245 Park Avenue, 44th Floor, New York, New York 10167, by calling us at (888) 818-5298 or on the SEC's website at www.sec.gov .

PRIVACY PRINCIPLES

              We endeavor to maintain the privacy of our recordholders and to safeguard their non-public personal information. The following information is provided to help you understand what personal information we collect, how we protect that information and why, in certain cases, we may share information with select other parties.

              Generally, we will not receive any non-public personal information about recordholders of our common stock, although certain of our recordholders' non-public information may become available to us. The non-public personal information that we may receive falls into the following categories:

    information we receive from recordholders, whether we receive it orally, in writing or electronically. This includes recordholders' communications to us concerning their investment;

    information about recordholders' transactions and history with us; and

    other general information that we may obtain about recordholders, such as demographic and contact information such as address.

              We disclose non-public personal information about recordholders:

    to our affiliates (such as our investment adviser and administrator) and their employees for everyday business purposes;

    to our service providers (such as our accountants, attorneys, custodians, transfer agent, underwriters and proxy solicitors) and their employees as is necessary to service recordholder accounts or otherwise provide the applicable service;

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    to comply with court orders, subpoenas, lawful discovery requests, or other legal or regulatory requirements; or

    as allowed or required by applicable law or regulation.

              When we share non-public recordholder personal information referred to above, the information is made available for limited business purposes and under controlled circumstances designed to protect our recordholders' privacy. The Company does not permit use of recordholder information for any non-business or marketing purpose, nor do we permit third parties to rent, sell, trade or otherwise release or disclose information to any other party.

              The Company's service providers, such as its adviser, administrator, and transfer agent, are required to maintain physical, electronic, and procedural safeguards to protect recordholder non-public personal information; to prevent unauthorized access or use; and to dispose of such information when it is no longer required.

              Personnel of affiliates may access recordholder information only for business purposes. The degree of access is based on the sensitivity of the information and on personnel need for the information to service a recordholder's account or comply with legal requirements.

              If a recordholder ceases to be a recordholder, we will adhere to the privacy policies and practices as described above. We may choose to modify our privacy policies at any time. Before we do so, we will notify recordholders and provide a description of our privacy policy.

              In the event of a corporate change in control resulting from, for example, a sale to, or merger with, another entity, or in the event of a sale of assets, we reserve the right to transfer non-public personal information of holders of our securities to the new party in control or the party acquiring assets.

OTHER

              We have designated a chief compliance officer and established a compliance program pursuant to the requirements of the Investment Company Act. We are periodically examined by the SEC for compliance with the Investment Company Act.

              We are required to provide and maintain a bond issued by a reputable fidelity insurance company to protect us against larceny and embezzlement. Furthermore, as a BDC, we are prohibited from protecting any director or officer against any liability to us or our stockholders arising from willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person's office.

Compliance with the Sarbanes-Oxley Act of 2002 and The NASDAQ Global Select Market Corporate Governance Regulations

              The Sarbanes-Oxley Act of 2002 (the "Sarbanes-Oxley Act") imposes a wide variety of regulatory requirements on publicly held companies and their insiders. Many of these requirements affect us. The Sarbanes-Oxley Act has required us to review our policies and procedures to determine whether we comply with the Sarbanes-Oxley Act and the regulations promulgated thereunder. We will continue to monitor our compliance with all future regulations that are adopted under the Sarbanes-Oxley Act and will take actions necessary to ensure that we are in compliance therewith.

              In addition, The NASDAQ Global Select Market has adopted various corporate governance requirements as part of its listing standards. We believe we are in compliance with such corporate governance listing standards. We will continue to monitor our compliance with all future listing standards and will take actions necessary to ensure that we are in compliance therewith.

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CUSTODIAN, TRANSFER AND DIVIDEND PAYING AGENT AND REGISTRAR

              Our securities are held under a custody agreement by U.S. Bank National Association. The address of the custodian is Corporate Trust Services, One Federal Street, 3rd Floor, Boston, MA 02110. Computershare acts as the transfer agent, dividend paying agent and registrar for our common stock. The principal business address of Computershare is 250 Royall Street, Canton, MA 02021.

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BROKERAGE ALLOCATION AND OTHER PRACTICES

              Since we generally acquire and dispose of our investments in privately negotiated transactions, we infrequently use brokers in the normal course of business.

              Subject to policies established by our board of directors, our investment adviser, Ares Capital Management, is primarily responsible for the execution of the publicly traded securities portion of our portfolio transactions and the allocation of brokerage commissions. Our investment adviser does not expect to execute transactions through any particular broker or dealer, but seeks to obtain the best net results for us, taking into account such factors as price (including the applicable brokerage commission or dealer spread), size of order, difficulty of execution, and operational facilities of the firm and the firm's risk and skill in positioning blocks of securities.

              While our investment adviser generally seeks reasonably competitive trade execution costs, we will not necessarily pay the lowest spread or commission available. Subject to applicable legal requirements, our investment adviser may select a broker based partly upon brokerage or research services provided to our investment adviser and us and any other clients. In return for such services, we may pay a higher commission than other brokers would charge if our investment adviser determines in good faith that such commission is reasonable in relation to the services provided.

              We also pay brokerage commissions incurred in connection with open-market purchases pursuant to our dividend reinvestment plan.

              The aggregate amount of brokerage commissions paid by us during the three most recent fiscal years is $0.1 million.

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PLAN OF DISTRIBUTION

              We may offer, from time to time, in one or more offerings or series, up to $3,000,000,000 of our common stock, preferred stock, debt securities, subscription rights to purchase shares of our common stock or warrants representing rights to purchase shares of our common stock, preferred stock or debt securities, or units comprised of any combination of the foregoing, in one or more underwritten public offerings, at-the-market offerings, negotiated transactions, block trades, best efforts or a combination of these methods. We may sell the securities through underwriters or dealers, directly to one or more purchasers, including existing stockholders in a rights offering, through agents or through a combination of any such methods of sale. In the case of a rights offering, the applicable prospectus supplement will set forth the number of shares of our common stock issuable upon the exercise of each right and the other terms of such rights offering. Any underwriter or agent involved in the offer and sale of the securities will be named in the applicable prospectus supplement. A prospectus supplement or supplements will also describe the terms of the offering of the securities, including: the purchase price of the securities and the proceeds we will receive from the sale; any over-allotment options under which underwriters may purchase additional securities from us; any agency fees or underwriting discounts and other items constituting agents' or underwriters' compensation; the public offering price; any discounts or concessions allowed or re-allowed or paid to dealers; and any securities exchange or market on which the securities may be listed. Only underwriters named in the prospectus supplement will be underwriters of the securities offered by the prospectus supplement.

              The distribution of the securities may be effected from time to time in one or more transactions at a fixed price or prices, which may be changed, at prevailing market prices at the time of sale, at prices related to such prevailing market prices, or at negotiated prices, provided, however, that the offering price per share of our common stock, less any underwriting commissions or discounts, must equal or exceed the net asset value per share of our common stock at the time of the offering except (a) in connection with a rights offering to our existing stockholders, (b) with the consent of the majority of our common stockholders or (c) under such circumstances as the SEC may permit. The price at which securities may be distributed may represent a discount from prevailing market prices.

              In connection with the sale of the securities, underwriters or agents may receive compensation from us or from purchasers of the securities, for whom they may act as agents, in the form of discounts, concessions or commissions. Underwriters may sell the securities to or through dealers and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for whom they may act as agents. Underwriters, dealers and agents that participate in the distribution of the securities may be deemed to be underwriters under the Securities Act, and any discounts and commissions they receive from us and any profit realized by them on the resale of the securities may be deemed to be underwriting discounts and commissions under the Securities Act. Any such underwriter or agent will be identified and any such compensation received from us will be described in the applicable prospectus supplement. The maximum aggregate commission or discount to be received by any member of FINRA or independent broker-dealer will not be greater than 8% of the gross proceeds of the sale of securities offered pursuant to this prospectus and any applicable prospectus supplement. We may also reimburse the underwriter or agent for certain fees and legal expenses incurred by it.

              Any underwriter may engage in over-allotment, stabilizing transactions, short-covering transactions and penalty bids in accordance with Regulation M under the Exchange Act. Over-allotment involves sales in excess of the offering size, which create a short position. Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum price. Syndicate-covering or other short-covering transactions involve purchases of the securities, either through exercise of the over-allotment option or in the open market after the distribution is completed, to cover short positions. Penalty bids permit the underwriters to reclaim a selling concession from a dealer when the securities originally sold by the dealer are

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purchased in a stabilizing or covering transaction to cover short positions. Those activities may cause the price of the securities to be higher than it would otherwise be. If commenced, the underwriters may discontinue any of the activities at any time.

              Any underwriters that are qualified market makers on the NASDAQ Global Market may engage in passive market making transactions in our common stock on the NASDAQ Global Market in accordance with Regulation M under the Exchange Act, during the business day prior to the pricing of the offering, before the commencement of offers or sales of our common stock. Passive market makers must comply with applicable volume and price limitations and must be identified as passive market makers. In general, a passive market maker must display its bid at a price not in excess of the highest independent bid for such security; if all independent bids are lowered below the passive market maker's bid, however, the passive market maker's bid must then be lowered when certain purchase limits are exceeded. Passive market making may stabilize the market price of the securities at a level above that which might otherwise prevail in the open market and, if commenced, may be discontinued at any time.

              We may sell securities directly or through agents we designate from time to time. We will name any agent involved in the offering and sale of securities and we will describe any commissions we will pay the agent in the prospectus supplement. Unless the prospectus supplement states otherwise, our agent will act on a best-efforts basis for the period of its appointment.

              Unless otherwise specified in the applicable prospectus supplement, each class or series of securities will be a new issue with no trading market, other than our common stock, which is traded on The NASDAQ Global Select Market. We may elect to list any other class or series of securities on any exchanges, but we are not obligated to do so. We cannot guarantee the liquidity of the trading markets for any securities.

              Under agreements that we may enter, underwriters, dealers and agents who participate in the distribution of shares of our securities may be entitled to indemnification by us against certain liabilities, including liabilities under the Securities Act, or contribution with respect to payments that the agents or underwriters may make with respect to these liabilities. Underwriters, dealers and agents may engage in transactions with, or perform services for, us in the ordinary course of business.

              If so indicated in the applicable prospectus supplement, we will authorize underwriters or other persons acting as our agents to solicit offers by certain institutions to purchase our securities from us pursuant to contracts providing for payment and delivery on a future date. Institutions with which such contracts may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and others, but in all cases such institutions must be approved by us. The obligations of any purchaser under any such contract will be subject to the condition that the purchase of our securities shall not at the time of delivery be prohibited under the laws of the jurisdiction to which such purchaser is subject. The underwriters and such other agents will not have any responsibility in respect of the validity or performance of such contracts. Such contracts will be subject only to those conditions set forth in the prospectus supplement, and the prospectus supplement will set forth the commission payable for solicitation of such contracts.

              We may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement indicates, in connection with those derivatives, the third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of stock. The third parties in such sale transactions will be underwriters and, if not identified in this prospectus, will be identified in the applicable prospectus supplement.

              In order to comply with the securities laws of certain states, if applicable, our securities offered hereby will be sold in such jurisdictions only through registered or licensed brokers or dealers.

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LEGAL MATTERS

              The legality of the securities offered hereby will be passed upon for the Company by Kirkland & Ellis LLP, Los Angeles, California and New York, New York, and Venable LLP, Baltimore, Maryland. Certain legal matters in connection with the offering will be passed upon for the underwriters, if any, by the counsel named in the prospectus supplement.

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INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

              KPMG LLP, located at 550 South Hope Street, Suite 1500, Los Angeles, California 90071, is the independent registered public accounting firm of the Company.

              The audited financial statements and the senior securities table of the Company included in this prospectus have been so included in reliance on the reports of KPMG LLP, an independent registered public accounting firm whose reports thereon are included elsewhere in this prospectus, given on the authority of said firm as experts in auditing and accounting.

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AVAILABLE INFORMATION

              We have filed with the SEC a registration statement on Form N-2, together with all amendments and related exhibits, under the Securities Act, with respect to the securities offered by this prospectus. The registration statement contains additional information about us and the securities being offered by this prospectus.

              We file with or submit to the SEC annual, quarterly and current periodic reports, proxy statements and other information meeting the informational requirements of the Exchange Act. This information is available free of charge by calling us collect at (310) 201-4200 or on our website at www.arescapitalcorp.com. Information contained on our website is not incorporated into this prospectus and you should not consider such information to be part of this document. You also may inspect and copy these reports, proxy statements and other information, as well as the registration statement and related exhibits and schedules, after paying a duplicating fee, by sending a request by e-mail to publicinfo@sec.gov or by writing the SEC's Public Reference Branch, Office of Consumer Affairs and Information Services, Securities and Exchange Commission, Washington, D.C. 20549.

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INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

              This prospectus is part of a registration statement that we have filed with the SEC. Pursuant to the SBCAA, we are allowed to "incorporate by reference" the information that we file with the SEC, which means that we can disclose important information to you by referring you to such information incorporated by reference. The information incorporated by reference is considered to comprise a part of this prospectus from the date we file any such document. Any reports filed by us with the SEC subsequent to the date of this prospectus and before the date that any offering of any securities by means of this prospectus and any accompanying prospectus supplement is terminated will automatically update and, where applicable, supersede any information contained in this prospectus or incorporated by reference in this prospectus.

              We incorporate by reference into this prospectus our filings listed below and any future filings that we may file with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, subsequent to the date of this prospectus until all of the securities offered by this prospectus and any accompanying prospectus supplement have been sold or we otherwise terminate the offering of those securities; provided, however, that information "furnished" under Item 2.02 or Item 7.01 of Form 8-K or other information "furnished" to the SEC which is not deemed filed is not incorporated by reference in this prospectus and any accompanying prospectus supplement. Information that we file with the SEC subsequent to the date of this prospectus will automatically update and may supersede information in this prospectus, any accompanying prospectus supplement and other information previously filed with the SEC.

              The prospectus incorporates by reference the documents set forth below that have been previously filed with the SEC:

    our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, filed with the SEC on February 12, 2019, including the information specifically incorporated by reference into the Form 10-K from our Definitive Proxy Statement on Schedule 14A, filed with the SEC on April 10, 2019;

    our Quarterly Report on Form 10-Q for the three months ended March 31, 2019, filed with the SEC on April 30, 2019; and

    our Current Reports on Form 8-K filed with the SEC on April 2, 2019, March 20, 2019 and March 8, 2019.

              See "Available Information" for information on how to obtain a copy of these filings.

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INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

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Report of Independent Registered Public Accounting Firm

To the stockholders and board of directors
Ares Capital Corporation:

Opinion on the Consolidated Financial Statements

        We have audited the accompanying consolidated balance sheets of Ares Capital Corporation and subsidiaries (the "Company"), including the consolidated schedules of investments, as of December 31, 2018 and 2017, the related consolidated statements of operations, stockholders' equity, and cash flows for each of the years in the three-year period ended December 31, 2018, and the related notes (collectively, the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2018 and 2017, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2018, in conformity with U.S. generally accepted accounting principles.

        We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the Company's internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated February 12, 2019 expressed an unqualified opinion on the effectiveness of the Company's internal control over financial reporting.

Basis for Opinion

        These consolidated financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

        We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Such procedures also included confirmation of investments owned as of December 31, 2018 by correspondence with custodians, portfolio companies or agents. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

GRAPHIC

We have served as the Company's auditor since 2004.

Los Angeles, California
February 12, 2019

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Report of Independent Registered Public Accounting Firm

The stockholders and board of directors
Ares Capital Corporation:

Opinion on Internal Control Over Financial Reporting

        We have audited Ares Capital Corporation and subsidiaries' (the "Company") internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2018, based on criteria established in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

        We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) ("PCAOB"), the consolidated balance sheets of the Company, including the consolidated schedules of investments, as of December 31, 2018 and 2017, and the related consolidated statements of operations, stockholders' equity, and cash flows, for each of the years in the three-year period ended December 31, 2018, and the related notes (collectively, the "consolidated financial statements"), and our report dated February 12, 2019, expressed an unqualified opinion on those consolidated financial statements.

Basis for Opinion

        The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

        We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

        A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide

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reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

        Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

GRAPHIC

Los Angeles, California
February 12, 2019

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(in millions, except per share data)

 
  As of December 31,  
 
  2018   2017  

ASSETS

             

Investments at fair value

             

Non-controlled/non-affiliate company investments

  $ 10,478   $ 10,010  

Non-controlled affiliate company investments

    292     216  

Controlled affiliate company investments

    1,647     1,615  

Total investments at fair value (amortized cost of $12,754 and $11,905, respectively)

    12,417     11,841  

Cash and cash equivalents

    296     316  

Interest receivable

    91     93  

Receivable for open trades

    12     1  

Other assets

    79     96  

Total assets

  $ 12,895   $ 12,347  

LIABILITIES

             

Debt

  $ 5,214   $ 4,854  

Base management fees payable

    45     44  

Income based fees payable

    36     27  

Capital gains incentive fees payable

    112     79  

Accounts payable and other liabilities

    99     181  

Interest and facility fees payable

    64     64  

Payable for open trades

    25      

Total liabilities

    5,595     5,249  

Commitments and contingencies (Note 7)

             

STOCKHOLDERS' EQUITY

             

Common stock, par value $0.001 per share, 600 common shares authorized; 426 and 426 common shares issued and outstanding, respectively

         

Capital in excess of par value

    7,173     7,192  

Accumulated undistributed (overdistributed) earnings

    127     (94 )

Total stockholders' equity

    7,300     7,098  

Total liabilities and stockholders' equity

  $ 12,895   $ 12,347  

NET ASSETS PER SHARE

  $ 17.12   $ 16.65  

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS

(in millions, except per share data)

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

INVESTMENT INCOME:

                   

From non-controlled/non-affiliate company investments:

                   

Interest income from investments (excluding payment-in-kind ("PIK") interest)

  $ 834   $ 711   $ 515  

PIK interest income from investments

    42     42     34  

Capital structuring service fees

    130     95     90  

Dividend income

    35     26     35  

Other income

    38     19     14  

Total investment income from non-controlled/non-affiliate company investments

    1,079     893     688  

From non-controlled affiliate company investments:

                   

Interest income from investments (excluding PIK interest)

    16     13     12  

PIK interest income from investments

    4     4     4  

Capital structuring service fees

            1  

Dividend income

    4     1      

Total investment income from non-controlled affiliate company investments

    24     18     17  

From controlled affiliate company investments:

                   

Interest income from investments (excluding PIK interest)

    123     162     238  

PIK interest income from investments

    22     19     3  

Capital structuring service fees

    13     10     8  

Dividend income

    58     49     40  

Other income

    18     9     18  

Total investment income from controlled affiliate company investments

    234     249     307  

Total investment income

    1,337     1,160     1,012  

EXPENSES:

                   

Interest and credit facility fees

    240     225     186  

Base management fees

    180     171     137  

Income based fees

    169     134     123  

Capital gains incentive fees

    33     41     (5 )

Administrative fees

    13     12     14  

Professional fees and other costs related to the American Capital Acquisition

    3     45     15  

Other general and administrative

    26     32     27  

Total expenses

    664     660     497  

Waiver of income based fees

    (40 )   (30 )    

Total expenses, net of waiver of income based fees

    624     630     497  

NET INVESTMENT INCOME BEFORE INCOME TAXES

    713     530     515  

Income tax expense, including excise tax

    19     19     21  

NET INVESTMENT INCOME

    694     511     494  

REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS, FOREIGN CURRENCY AND OTHER TRANSACTIONS:

                   

Net realized gains (losses):

                   

Non-controlled/non-affiliate company investments

    90     (56 )   66  

Non-controlled affiliate company investments

            14  

Controlled affiliate company investments

    316     100     30  

Foreign currency and other transactions

    13     (20 )    

Net realized gains

    419     24     110  

Net unrealized gains (losses):

                   

Non-controlled/non-affiliate company investments

    (85 )   (42 )   (179 )

Non-controlled affiliate company investments

    4     (2 )   14  

Controlled affiliate company investments

    (190 )   187     40  

Foreign currency and other transactions

    16     (7 )   (5 )

Net unrealized gains (losses)

    (255 )   136     (130 )

Net realized and unrealized gains (losses) on investments, foreign currency and other transactions

    164     160     (20 )

REALIZED LOSSES ON EXTINGUISHMENT OF DEBT

        (4 )    

NET INCREASE IN STOCKHOLDERS' EQUITY RESULTING FROM OPERATIONS

  $ 858   $ 667   $ 474  

BASIC AND DILUTED EARNINGS PER COMMON SHARE (see Note 10)

  $ 2.01   $ 1.57   $ 1.51  

WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING (see Note 10)

    426     425     314  

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of December 31, 2018
(dollar amounts in millions)

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Healthcare Services                                      
Absolute Dental Management LLC and ADM Equity, LLC   Dental services provider   First lien senior secured loan ($19.1 par due 1/2022)         1/5/2016   $ 19.1   $ 11.8 (2)(14)      
        First lien senior secured loan ($5.1 par due 1/2022)         1/5/2016     5.1     3.1 (4)(14)      
        Class A preferred units (4,000,000 units)         1/5/2016     4.0     (2)      
        Class A common units (4,000,000 units)         1/5/2016         (2)      
                        28.2     14.9        
                                       
Acessa Health Inc. (fka HALT Medical, Inc.)   Medical supply provider   Common stock (569,823 shares)         6/22/2017     0.1            
                                       
ADCS Billings Intermediate Holdings, LLC(19)   Dermatology practice   First lien senior secured revolving loan ($1.3 par due 5/2022)   10.25%
(Base Rate + 4.75%/Q)
    5/18/2016     1.3     1.2 (2)(15)      
                                       
ADG, LLC and RC IV GEDC Investor LLC(19)   Dental services provider   First lien senior secured revolving loan ($3.1 par due 9/2022)   7.27%
(Libor + 4.75%/M)
    9/28/2016     3.1     3.0 (2)(15)      
        First lien senior secured revolving loan ($8.1 par due 9/2022)   9.25%
(Base Rate + 3.75%/M)
    9/28/2016     8.1     7.8 (2)(15)      
        Second lien senior secured loan ($87.5 par due 3/2024)   11.88%
(Libor + 9.00%/Q)
    9/28/2016     87.5     77.0 (2)(15)      
        Membership units (3,000,000 units)         9/28/2016     3.0     1.0 (2)      
                        101.7     88.8        
                                       
Air Medical Group Holdings, Inc. and Air Medical Buyer Corp.   Emergency air medical services provider   Senior subordinated loan ($182.7 par due 3/2026)   10.38%
(Libor + 7.88%/M)
    3/14/2018     182.7     182.7 (2)(15)      
        Warrant to purchase up to 115,733 units of common stock (expires 3/2028)         3/14/2018     0.9     1.6 (2)      
                        183.6     184.3        
                                       
Alcami Corporation and ACM Holdings I, LLC(19)   Outsourced drug development services provider   First lien senior secured revolving loan ($1.8 par due 7/2023)   6.26%
(Libor + 3.75%/M)
    7/12/2018     1.8     1.8 (2)(15)      
        First lien senior secured revolving loan ($1.7 par due 7/2023)   6.21%
(Libor + 3.75%/M)
    7/12/2018     1.7     1.7 (2)(15)      
        First lien senior secured loan ($30.1 par due 7/2025)   6.71%
(Libor + 4.25%/M)
    7/12/2018     30.0     29.8 (3)(15)      
        Second lien senior secured loan ($77.5 par due 7/2026)   10.51%
(Libor + 8.00%/M)
    7/12/2018     76.8     76.0 (2)(15)      
        Common units (3,269,900 units)         7/12/2018     32.7     26.1 (2)      
                        143.0     135.4        
                                       
Alteon Health, LLC   Provider of physician management services   First lien senior secured loan ($3.0 par due 9/2022)   9.02%
(Libor + 6.50%/M)
    5/15/2017     3.0     2.5 (2)(15)      
                                       
American Academy Holdings, LLC(19)   Provider of education, training, certification, networking, and consulting services to medical coders and other healthcare professionals   First lien senior secured revolving loan ($0.9 par due 12/2022)   9.05%
(Libor + 6.25%/Q)
    12/15/2017     0.9     0.9 (2)(15)      
        First lien senior secured loan ($85.8 par due 12/2022)   9.05%
(Libor + 6.25%/Q)
    12/15/2017     85.8     85.8 (2)(15)      
        First lien senior secured loan ($92.4 par due 12/2022)   9.05%
(Libor + 6.25%/Q)
    12/15/2017     92.4     92.4 (3)(15)      
        Senior subordinated loan ($79.9 par due 6/2023)   16.33%
(Libor + 8.00% Cash, 6.00% PIK/Q)
    12/15/2017     79.9     79.9 (2)(15)      
                        259.0     259.0        
                                     

F-7


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Bambino CI Inc.(19)   Manufacturer and provider of single-use obstetrics products   First lien senior secured revolving loan ($0.3 par due 12/2023)   7.93%
(Libor + 5.50%/M)
    10/17/2017     0.3     0.3 (2)(15)      
        First lien senior secured loan ($2.5 par due 12/2024)   8.02%
(Libor + 5.50%/M)
    10/17/2017     2.5     2.5 (2)(15)      
        First lien senior secured loan ($30.9 par due 12/2024)   8.02%
(Libor + 5.50%/M)
    10/17/2017     30.9     30.9 (3)(15)      
                        33.7     33.7        
                                       
Care Hospice, Inc(19)   Provider of hospice services   First lien senior secured revolving loan ($0.3 par due 4/2022)   7.22%
(Libor + 4.75%/M)
    2/8/2018     0.3     0.3 (2)(15)(18)      
                                       
CCS-CMGC Holdings, Inc.(19)   Correctional facility healthcare operator   First lien senior secured revolving loan ($1.9 par due 10/2023)   8.02%
(Libor + 5.50%/M)
    10/1/2018     1.9     1.8 (2)(15)(18)      
        First lien senior secured loan ($35.0 par due 10/2025)   8.02%
(Libor + 5.50%/M)
    9/25/2018     34.7     34.8 (3)(15)      
                        36.6     36.6        
                                       
Center for Autism and Related Disorders, LLC(19)   Autism treatment and services provider specializing in applied behavior analysis therapy   First lien senior secured revolving loan       11/21/2018         (17)      
                                       
Comprehensive EyeCare Partners, LLC(19)   Vision care practice management company   First lien senior secured revolving loan ($0.2 par due 2/2024)   9.00%
(Base Rate + 3.50%/Q)
    2/14/2018     0.2     0.2 (2)(15)      
        First lien senior secured loan ($2.4 par due 2/2024)   7.30%
(Libor + 4.50%/Q)
    2/14/2018     2.4     2.4 (2)(15)      
        First lien senior secured loan ($5.4 par due 2/2024)   7.30%
(Libor + 4.50%/Q)
    2/14/2018     5.4     5.4 (2)(15)      
                        8.0     8.0        
                                       
CSHM LLC(7)   Dental services provider   Class A membership units (1,979 units)         1/3/2017                
                                       
D4C Dental Brands HoldCo, Inc. and Bambino Group Holdings, LLC(19)   Dental services provider   First lien senior secured revolving loan ($3.3 par due 12/2022)   10.75%
(Base Rate + 5.25%/Q)
    12/21/2016     3.3     3.3 (2)(15)      
        Class A preferred units (1,000,000 units)         12/21/2016     1.0     1.3 (2)      
                        4.3     4.6        
                                       
Datix Bidco Limited(8)   Global healthcare software company that provides software solutions for patient safety and risk management   First lien senior secured loan ($5.8 par due 4/2025)   7.28%
(Libor + 4.50%/S)
    4/27/2018     5.7     5.8 (2)(15)      
                                       
DCA Investment Holding, LLC(19)   Multi-branded dental practice management   First lien senior secured revolving loan ($0.4 par due 7/2021)   9.75%
(Base Rate + 4.25%/Q)
    7/2/2015     0.4     0.4 (2)(15)(18)      
        First lien senior secured loan ($18.5 par due 7/2021)   8.05%
(Libor + 5.25%/Q)
    7/2/2015     18.5     18.5 (4)(15)      
                        18.9     18.9        
                                       
Emerus Holdings, Inc.(19)   Freestanding 24-hour emergency care micro-hospitals operator   First lien senior secured revolving loan ($3.0 par due 9/2020)   7.31%
(Libor + 4.50%/Q)
    3/14/2017     3.0     2.9 (2)(15)      
        First lien senior secured loan ($3.2 par due 9/2021)   7.31%
(Libor + 4.50%/Q)
    3/14/2017     2.9     3.1 (2)(15)      
                        5.9     6.0        
                                       
GHX Ultimate Parent Corporation, Commerce Parent, Inc. and Commerce Topco, LLC   On-demand supply chain automation solutions provider to the healthcare industry   Second lien senior secured loan ($34.5 par due 6/2025)   10.81%
(Libor + 8.00%/Q)
    6/30/2017     34.2     34.5 (2)(15)      
        Series A preferred stock (110,425 shares)   13.55% PIK
(Libor + 10.75%/Q)
    6/30/2017     133.5     133.5 (2)(15)      
        Class A units (14,013,303 units)         6/30/2017     14.0     16.9 (2)      
                        181.7     184.9        
                                       
Greenphire, Inc. and RMCF III CIV XXIX, L.P   Software provider for clinical trial management   Limited partnership interest (99.90% interest)         12/19/2014     1.0     3.0 (2)      
                                     

F-8


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Hygiena Borrower LLC(19)   Adenosine triphosphate testing technology provider   First lien senior secured revolving loan       8/26/2016         (17)      
        First lien senior secured loan ($9.5 par due 8/2022)   6.80%
(Libor + 4.00%/Q)
    6/29/2018     9.5     9.4 (2)(15)      
        Second lien senior secured loan ($11.1 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    6/29/2018     11.1     11.0 (2)(15)      
        Second lien senior secured loan ($0.6 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    6/29/2018     0.6     0.6 (2)(15)      
        Second lien senior secured loan ($10.0 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    8/26/2016     10.0     9.9 (2)(15)      
        Second lien senior secured loan ($10.7 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    2/27/2017     10.7     10.6 (2)(15)      
                        41.9     41.5        
                                       
JDC Healthcare Management, LLC(19)   Dental services provider   First lien senior secured revolving loan ($0.8 par due 4/2022)   12.25%
(Base Rate + 6.75%/Q)
    4/10/2017     0.8     0.8 (2)(15)      
        First lien senior secured loan ($4.1 par due 4/2023)   10.01%
(Libor + 7.75%/A)
    4/10/2017     4.1     4.1 (2)(15)      
        First lien senior secured loan ($9.9 par due 4/2023)   10.27%
(Libor + 7.75%/M)
    4/10/2017     9.9     9.7 (2)(15)      
        First lien senior secured loan ($19.7 par due 4/2023)   10.27%
(Libor + 7.75%/M)
    4/10/2017     19.7     19.3 (4)(15)      
                        34.5     33.9        
                                       
KBHS Acquisition, LLC (d/b/a Alita Care, LLC)(19)   Provider of behavioral health services   First lien senior secured revolving loan ($0.2 par due 3/2022)   7.38%
(Libor + 5.00%/M)
    3/17/2017     0.2     0.2 (2)(15)      
        First lien senior secured revolving loan ($0.3 par due 3/2022)   7.42%
(Libor + 5.00%/M)
    3/17/2017     0.3     0.3 (2)(15)      
        First lien senior secured revolving loan ($0.8 par due 3/2022)   7.46%
(Libor + 5.00%/M)
    3/17/2017     0.8     0.8 (2)(15)      
        First lien senior secured revolving loan ($0.6 par due 3/2022)   7.47%
(Libor + 5.00%/M)
    3/17/2017     0.6     0.6 (2)(15)      
        First lien senior secured revolving loan ($0.3 par due 3/2022)   7.50%
(Libor + 5.00%/M)
    3/17/2017     0.3     0.3 (2)(15)      
        First lien senior secured revolving loan ($0.3 par due 3/2022)   7.43%
(Libor + 5.00%/M)
    3/17/2017     0.3     0.3 (2)(15)      
        First lien senior secured revolving loan ($2.1 par due 3/2022)   7.52%
(Libor + 5.00%/M)
    3/17/2017     2.1     2.0 (2)(15)      
                        4.6     4.5        
                                       
Key Surgical LLC(19)   Provider of sterile processing, operating room and instrument care supplies for hospitals   First lien senior secured loan ($17.0 par due 6/2023)   5.75%
(EURIBOR + 4.75%/Q)
    6/1/2017     16.6     17.0 (2)(15)      
        First lien senior secured loan ($9.3 par due 6/2023)   7.28%
(Libor + 4.75%/Q)
    10/31/2018     9.3     9.3 (2)(15)      
                        25.9     26.3        
                                       
MB2 Dental Solutions, LLC(19)   Dental services provider   First lien senior secured revolving loan ($2.7 par due 9/2023)   9.25%
(Base Rate + 3.75%/Q)
    9/29/2017     2.7     2.7 (2)(15)      
        First lien senior secured loan ($5.8 par due 9/2023)   7.57%
(Libor + 4.75%/Q)
    9/29/2017     5.8     5.8 (2)(15)      
                        8.5     8.5        
                                     

F-9


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
MCH Holdings, Inc. and MC Acquisition Holdings I, LLC   Healthcare professional provider   First lien senior secured loan ($25.7 par due 1/2020)   7.96%
(Libor + 5.50%/M)
    7/26/2017     25.7     25.7 (2)(15)      
        First lien senior secured loan ($26.2 par due 1/2020)   8.02%
(Libor + 5.50%/M)
    7/26/2017     26.2     26.2 (2)(15)      
        First lien senior secured loan ($39.6 par due 1/2020)   7.96%
(Libor + 5.50%/M)
    7/26/2017     39.6     39.6 (3)(15)      
        First lien senior secured loan ($40.5 par due 1/2020)   8.02%
(Libor + 5.50%/M)
    7/26/2017     40.5     40.5 (3)(15)      
        First lien senior secured loan ($9.0 par due 1/2020)   7.96%
(Libor + 5.50%/M)
    7/26/2017     9.0     9.0 (4)(15)      
        First lien senior secured loan ($9.2 par due 1/2020)   8.02%
(Libor + 5.50%/M)
    7/26/2017     9.2     9.2 (4)(15)      
        Class A units (1,438,643 shares)         1/17/2014     1.5     1.2 (2)      
                        151.7     151.4        
                                       
MW Dental Holding Corp.(19)   Dental services provider   First lien senior secured revolving loan ($7.0 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    4/12/2011     7.0     7.0 (2)(15)      
        First lien senior secured loan ($16.9 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    3/19/2018     16.9     16.9 (2)(15)      
        First lien senior secured loan ($104.5 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    4/12/2011     104.5     104.5 (3)(15)      
        First lien senior secured loan ($19.1 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    4/12/2011     19.1     19.1 (4)(15)      
                        147.5     147.5        
                                       
My Health Direct, Inc.   Healthcare scheduling exchange software solution provider   Warrant to purchase up to 4,548 shares of Series D preferred stock (expires 9/2024)         9/18/2014         (2)      
                                       
New Trident Holdcorp, Inc. and Trident Holding Company, LLC   Outsourced mobile diagnostic healthcare service provider   Second lien senior secured loan ($24.9 par due 7/2022)         8/1/2013     19.4     5.0 (2)(14)      
        Second lien senior secured loan ($78.4 par due 7/2020)         8/1/2013     67.8     (2)(14)      
        Senior subordinated loan ($9.1 par due 7/2020)         11/29/2017     8.8     (2)(14)      
                        96.0     5.0        
                                       
NMC Skincare Intermediate Holdings II, LLC(19)   Developer, manufacturer and marketer of skincare products   First lien senior secured loan ($24.9 par due 10/2024)   7.27%
(Libor + 4.75%/M)
    10/31/2018     24.9     24.6 (3)(15)      
                                       
NMN Holdings III Corp. and NMN Holdings LP(19)   Provider of complex rehab technology solutions for patients with mobility loss   Partnership units (30,000 units)         11/13/2018     3.0     2.9 (2)      
                                       
NMSC Holdings, Inc. and ASP NAPA Holdings, LLC   Anesthesia management services provider   Second lien senior secured loan ($72.8 par due 10/2023)   12.59%
(Libor + 10.00%/Q)
    4/19/2016     72.8     71.3 (2)(15)      
        Class A units (25,277 units)         4/19/2016     2.5     1.2 (2)      
                        75.3     72.5        
                                       
Nodality, Inc.   Biotechnology company   First lien senior secured loan ($3.1 par due 8/2016)         11/12/2015     2.1     (2)(14)      
        First lien senior secured loan ($14.7 par due 8/2016)         4/25/2014     9.7     (2)(14)      
        Warrant to purchase up to 3,736,255 shares of common stock (expires 3/2026)         5/1/2016         (2)      
                        11.8            
                                       
NSM Sub Holdings Corp.(19)   Provider of customized mobility, rehab and adaptive seating systems   First lien senior secured loan ($0.2 par due 10/2022)   6.66%
(Libor + 4.25%/Q)
    6/1/2018     0.2     0.2 (2)(15)      
        First lien senior secured loan ($0.4 par due 10/2022)   6.73%
(Libor + 4.25%/Q)
    6/1/2018     0.4     0.4 (2)(15)      
        First lien senior secured loan ($4.9 par due 10/2022)   7.05%
(Libor + 4.25%/Q)
    6/1/2018     4.9     4.9 (2)(15)      
                        5.5     5.5        
                                       
nThrive, Inc. (fka Precyse Acquisition Corp.)   Provider of healthcare information management technology and services   Second lien senior secured loan ($10.0 par due 4/2023)   12.27%
(Libor + 9.75%/M)
    4/20/2016     9.8     9.8 (2)(15)      
                                     

F-10


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
NueHealth Performance, LLC(19)   Developer, builder and manager of specialty surgical hospitals and ambulatory surgery centers   First lien senior secured loan ($1.5 par due 9/2023)   9.02%
(Libor + 6.50%/M)
    9/27/2018     1.5     1.5 (2)(15)      
        First lien senior secured loan ($10.0 par due 9/2023)   9.02%
(Libor + 6.50%/M)
    9/27/2018     10.0     10.0 (2)(15)      
                        11.5     11.5        
                                       
OmniSYS Acquisition Corporation, OmniSYS, LLC, and OSYS Holdings, LLC   Provider of technology-enabled solutions to pharmacies   Limited liability company membership interest (1.57%)         11/21/2013     1.0     0.8 (2)      
                                       
Pathway Vet Alliance LLC(19)   Operator of freestanding veterinary hospitals   First lien senior secured loan ($264.5 par due 12/2024)   6.98%
(Libor + 4.50%/M)
    12/21/2018     261.8     261.8 (2)(15)      
        Second lien senior secured loan ($175.1 par due 12/2025)   10.98%
(Libor + 8.50%/Q)
    12/21/2018     175.1     173.4 (2)(15)      
        Preferred subscription units (1,507,384 units)         12/21/2018     4.9     4.9        
                        441.8     440.1        
                                       
Patterson Medical Supply, Inc.   Distributor of rehabilitation supplies and equipment   Second lien senior secured loan ($78.0 par due 8/2023)   11.03%
(Libor + 8.50%/Q)
    9/2/2015     76.7     67.9 (2)(15)      
                                       
PhyMED Management LLC   Provider of anesthesia services   Second lien senior secured loan ($47.2 par due 5/2021)   11.46%
(Libor + 8.75%/Q)
    12/18/2015     46.9     47.2 (2)(15)      
                                       
Practice Insight, LLC(19)   Revenue cycle management provider to the emergency healthcare industry   First lien senior secured loan ($12.4 par due 8/2022)   7.52%
(Libor + 5.00%/M)
    8/23/2017     12.4     12.4 (4)(15)      
                                       
Premise Health Holding Corp. and OMERS Bluejay Investment Holdings LP(19)   Provider of employer-sponsored onsite health and wellness clinics and pharmacies   First lien senior secured revolving loan ($6.0 par due 7/2023)   6.09%
(Libor + 3.50%/S)
    7/10/2018     6.0     5.9 (2)(15)      
        First lien senior secured loan ($0.8 par due 7/2025)   6.55%
(Libor + 3.75%/Q)
    7/10/2018     0.8     0.8 (2)(15)      
        First lien senior secured loan ($20.0 par due 7/2025)   6.55%
(Libor + 3.75%/Q)
    7/10/2018     19.9     19.8 (4)(15)      
        Second lien senior secured loan ($67.1 par due 7/2026)   10.30%
(Libor + 7.50%/Q)
    7/10/2018     66.5     66.1 (2)(15)      
        Class A units (9,775 units)         7/10/2018     9.8     9.8 (2)      
                        103.0     102.4        
                                       
ProVation Medical, Inc.   Provider of documentation and coding software for GI physicians   First lien senior secured loan ($13.0 par due 3/2024)   9.42%
(Libor + 7.00%/Q)
    3/9/2018     12.8     13.0 (2)(15)      
                                       
RecoveryDirect Acquisition, L.L.C.(19)   Outpatient physical therapy provider   First lien senior secured loan ($6.9 par due 1/2024)   6.77%
(Libor + 4.25%/M)
    1/3/2018     6.9     6.9 (2)(15)      
        First lien senior secured loan ($14.8 par due 1/2024)   6.77%
(Libor + 4.25%/M)
    1/3/2018     14.8     14.8 (2)(15)      
        First lien senior secured loan ($19.8 par due 1/2024)   6.77%
(Libor + 4.25%/M)
    1/3/2018     19.8     19.8 (4)(15)      
                        41.5     41.5        
                                       
Respicardia, Inc.   Developer of implantable therapies to improve cardiovascular health   Warrant to purchase up to 99,094 shares of Series C preferred stock (expires 6/2022)         6/28/2012         (2)      
                                       
Salter Labs(19)   Developer, manufacturer and supplier of consumable products for medical device customers   First lien senior secured revolving loan ($0.6 par due 3/2020)   6.76%
(Libor + 4.25%/Q)
    2/8/2018     0.6     0.6 (2)(15)(18)      
        First lien senior secured revolving loan ($0.4 par due 3/2020)   7.05%
(Libor + 4.25%/Q)
    2/8/2018     0.4     0.4 (2)(15)(18)      
                        1.0     1.0        
                                     

F-11


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
SCSG EA Acquisition Company, Inc.(19)   Provider of outsourced clinical services to hospitals and health systems   First lien senior secured revolving loan       9/1/2017         (17)      
                                       
SiroMed Physician Services, Inc. and SiroMed Equity Holdings, LLC(19)   Outsourced anesthesia provider   First lien senior secured loan ($17.4 par due 3/2024)   7.55%
(Libor + 4.75%/Q)
    3/26/2018     17.4     17.1 (3)(15)      
        Common units (171,784 units)         3/26/2018     4.6     3.2 (2)      
                        22.0     20.3        
                                       
SM Wellness Holdings, Inc. and SM Holdco, Inc.(19)   Breast cancer screening provider   First lien senior secured loan ($0.7 par due 8/2024)   8.02%
(Libor + 5.50%/M)
    8/1/2018     0.7     0.7 (2)(15)      
        First lien senior secured loan ($7.1 par due 8/2024)   8.02%
(Libor + 5.50%/M)
    8/1/2018     7.1     7.1 (2)(15)      
        Series A preferred stock (44,975 shares)   13.05%
(Libor + 10.25%/Q)
    8/1/2018     47.4     47.4 (2)(15)      
        Series A units (7,475 units)         8/1/2018     7.5     0.1 (2)      
        Series B units (747,500 units)         8/1/2018         7.4 (2)      
                        62.7     62.7        
                                       
Synergy HomeCare Franchising, LLC and NP/Synergy Holdings, LLC(19)   Franchisor of private-pay home care for the elderly   First lien senior secured loan ($16.0 par due 4/2024)   8.55%
(Libor + 5.75%/Q)
    4/2/2018     16.0     16.0 (2)(15)      
        Common units (550 units)         4/2/2018     0.6     0.7        
                        16.6     16.7        
                                       
Teligent, Inc.(19)   Pharmaceutical company that develops, manufactures and markets injectable pharmaceutical products   Second lien senior secured loan ($18.3 par due 6/2024)   13.25%
(Base Rate + 7.75%/Q)
    12/13/2018     18.3     18.1 (2)(15)      
        Second lien senior secured loan ($45.5 par due 6/2024)   11.53%
(Libor + 8.75%/Q)
    12/13/2018     45.5     45.0 (2)(15)      
                        63.8     63.1        
                                       
TerSera Therapeutics LLC   Acquirer and developer of specialty therapeutic pharmaceutical products   First lien senior secured loan ($2.2 par due 3/2024)   8.06%
(Libor + 5.25%/Q)
    7/12/2018     2.2     2.2 (2)(15)      
        First lien senior secured loan ($2.2 par due 3/2024)   8.05%
(Libor + 5.25%/Q)
    7/12/2018     2.2     2.2 (2)(15)      
        First lien senior secured loan ($2.1 par due 3/2023)   8.05%
(Libor + 5.25%/Q)
    9/27/2018     2.1     2.1 (2)(15)      
        First lien senior secured loan ($5.2 par due 3/2023)   8.05%
(Libor + 5.25%/Q)
    5/3/2017     5.2     5.2 (4)(15)      
                        11.7     11.7        
                                       
U.S. Anesthesia Partners, Inc.   Anesthesiology service provider   Second lien senior secured loan ($71.8 par due 6/2025)   9.77%
(Libor + 7.25%/M)
    6/16/2017     70.9     70.4 (2)(15)      
                                       
United Digestive MSO Parent, LLC(19)   Gastroenterology physician group   First lien senior secured loan ($12.6 par due 12/2024)   7.02%
(Libor + 4.50%/M)
    12/14/2018     12.6     12.5 (2)(15)      
                                       
Urgent Cares of America Holdings I, LLC and FastMed Holdings I, LLC(19)   Operator of urgent care clinics   Preferred units (7,696,613 units)         6/11/2015     7.7     5.4        
        Series A common units (2,000,000 units)         6/11/2015     2.0            
        Series C common units (5,288,427 units)         6/11/2015                
                        9.7     5.4        
                                       
Urology Management Associates, LLC and JWC/UMA Holdings, L.P.   Urology private practice   First lien senior secured loan ($9.8 par due 8/2024)   7.52%
(Libor + 5.00%/M)
    8/31/2018     9.7     9.8 (2)(15)      
        Limited partnership interests (3.64% interest)         8/31/2018     4.8     4.8 (2)      
                        14.5     14.6        
                                       
Verscend Holding Corp.(19)   Healthcare analytics solutions provider   First lien senior secured loan ($99.8 par due 8/2025)   7.02%
(Libor + 4.50%/M)
    8/27/2018     99.0     97.8 (2)(15)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
VistaPharm, Inc. and Vertice Pharma UK Parent Limited   Manufacturer and distributor of generic pharmaceutical products   Preferred shares (40,662 shares)         12/21/2015     0.3     0.6 (8)      
                                       
West Dermatology, LLC(19)   Dermatology practice platform   First lien senior secured revolving loan ($0.7 par due 4/2022)   7.93%
(Libor + 5.50%/Q)
    2/8/2018     0.7     0.7 (2)(15)      
        First lien senior secured revolving loan ($0.6 par due 4/2022)   8.21%
(Libor + 5.50%/Q)
    2/8/2018     0.6     0.6 (2)(15)      
        First lien senior secured revolving loan ($3.7 par due 4/2022)   8.31%
(Libor + 5.50%/Q)
    2/8/2018     3.7     3.7 (2)(15)      
        First lien senior secured loan ($1.4 par due 4/2023)   7.90%
(Libor + 5.50%/Q)
    4/2/2018     1.4     1.4 (2)(15)      
        First lien senior secured loan ($0.3 par due 4/2023)   7.91%
(Libor + 5.50%/Q)
    4/2/2018     0.3     0.3 (2)(15)      
        First lien senior secured loan ($0.9 par due 4/2023)   7.94%
(Libor + 5.50%/Q)
    4/2/2018     0.9     0.9 (2)(15)      
        First lien senior secured loan ($0.1 par due 4/2023)   8.11%
(Libor + 5.50%/Q)
    4/2/2018     0.1     0.1 (2)(15)      
        First lien senior secured loan ($1.3 par due 4/2023)   8.21%
(Libor + 5.50%/Q)
    4/2/2018     1.3     1.3 (2)(15)      
        First lien senior secured loan ($0.8 par due 4/2023)   8.26%
(Libor + 5.50%/Q)
    4/2/2018     0.8     0.8 (2)(15)      
        First lien senior secured loan ($4.1 par due 4/2023)   8.31%
(Libor + 5.50%/Q)
    4/2/2018     4.1     4.1 (2)(15)      
        First lien senior secured loan ($1.3 par due 4/2023)   8.21%
(Libor + 5.50%/Q)
    9/5/2018     1.3     1.3 (2)(15)      
        First lien senior secured loan ($7.7 par due 4/2023)   8.31%
(Libor + 5.50%/Q)
    4/2/2018     7.7     7.7 (2)(15)      
                        22.9     22.9        
                                       
WIRB—Copernicus Group, Inc.(19)   Provider of regulatory, ethical, and safety review services for clinical research involving human subjects   First lien senior secured revolving loan       2/8/2018         (17)      
                                       
WSHP FC Acquisition LLC(19)   Provider of biospecimen products   First lien senior secured revolving loan ($2.5 par due 3/2024)   9.30%
(Libor + 6.50%/Q)
    3/30/2018     2.5     2.5 (2)(15)      
        First lien senior secured revolving loan ($0.8 par due 3/2024)   9.32%
(Libor + 6.50%/Q)
    3/30/2018     0.8     0.8 (2)(15)      
        First lien senior secured loan ($6.0 par due 3/2024)   9.32%
(Libor + 6.50%/Q)
    3/30/2018     6.0     6.0 (2)(15)      
        First lien senior secured loan ($28.5 par due 3/2024)   9.30%
(Libor + 6.50%/Q)
    3/30/2018     28.5     28.5 (3)(15)      
                        37.8     37.8        
                        2,850.0     2,696.1     36.95 %
                                       
Business Services                                      
Accommodations Plus Technologies LLC and Accommodations Plus Technologies Holdings LLC(19)   Provider of outsourced crew accommodations and logistics management solutions to the airline industry   First lien senior secured loan ($12.5 par due 5/2024)   7.62%
(Libor + 5.00%/S)
    5/11/2018     12.5     12.5 (2)(15)      
        Class A common units (236,358 units)         5/11/2018     4.5     6.4        
                        17.0     18.9        
                                       
Achilles Acquisition LLC(19)   Benefits broker and outsourced workflow automation platform provider for brokers   First lien senior secured loan ($16.7 par due 10/2025)   6.56%
(Libor + 4.00%/M)
    10/11/2018     16.7     16.7 (2)(15)      
        First lien senior secured loan ($21.4 par due 10/2025)   6.56%
(Libor + 4.00%/M)
    10/11/2018     21.4     21.3 (2)(15)      
                        38.1     38.0        
                                     

F-13


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Blue Campaigns Intermediate Holding Corp. and Elevate Parent, Inc. (dba EveryAction)(19)   Provider of fundraising and organizing efforts and digital services to non-profits and political campaigns   First lien senior secured loan ($27.5 par due 8/2023)   9.40%
(Libor + 6.75%/Q)
    8/20/2018     27.5     27.4 (2)(15)      
        Series A preferred stock (150,000 shares)         9/26/2018     1.5     1.5        
                        29.0     28.9        
                                       
CallMiner, Inc.   Provider of cloud-based conversational analytics solutions   Warrant to purchase up to 2,350,636 shares of Series 1 preferred stock (expires 7/2024)         7/23/2014         (2)      
                                       
Chesapeake Research Review, LLC and Schulman Associates Institutional Review Board, Inc.(19)   Provider of central institutional review boards over clinical trials   First lien senior secured loan ($15.8 par due 11/2023)   8.55%
(Libor + 5.75%/Q)
    11/7/2017     15.8     15.8 (2)(15)      
                                       
CMW Parent LLC (fka Black Arrow, Inc.)   Multiplatform media firm   Series A units (32 units)         9/11/2015         (2)      
                                       
Command Alkon Incorporated(19)   Software solutions provider to the ready-mix concrete industry   First lien senior secured revolving loan ($2.9 par due 9/2022)   9.50%
(Base Rate + 4.00%/M)
    9/1/2017     2.9     2.9 (2)(15)(18)      
        First lien senior secured loan ($20.4 par due 9/2023)   7.35%
(Libor + 5.00%/M)
    9/1/2017     20.4     20.2 (2)(15)      
        Second lien senior secured loan ($33.8 par due 3/2024)   11.35%
(Libor + 9.00%/M)
    9/1/2017     33.8     33.1 (2)(15)      
                        57.1     56.2        
                                       
Compusearch Software Systems, Inc.   Provider of enterprise software and services for organizations in the public sector   Second lien senior secured loan ($51.0 par due 11/2021)   11.36%
(Libor + 8.75%/Q)
    1/3/2017     51.0     51.0 (3)(15)      
                                       
Compuware Parent, LLC   Web and mobile cloud performance testing and monitoring services provider   Class A-1 common stock (4,132 units)         12/15/2014     2.3     2.6 (2)      
        Class B-1 common stock (4,132 units)         12/15/2014     0.5     0.5 (2)      
        Class C-1 common stock (4,132 units)         12/15/2014     0.3     0.3 (2)      
        Class A-2 common stock (4,132 units)         12/15/2014         (2)      
        Class B-2 common stock (4,132 units)         12/15/2014         (2)      
        Class C-2 common stock (4,132 units)         12/15/2014         (2)      
                        3.1     3.4        
                                       
Directworks, Inc. and Co-Exprise Holdings, Inc.   Provider of cloud-based software solutions for direct materials sourcing and supplier management for manufacturers   First lien senior secured loan ($1.8 par due 4/2018)         12/19/2014     1.3     0.2 (2)(14)      
        Warrant to purchase up to 1,875,000 shares of Series 1 preferred stock (expires 12/2024)         12/19/2014         (2)      
                        1.3     0.2        
                                       
Doxim Inc.(8)(19)   Enterprise content management provider   First lien senior secured loan ($3.6 par due 2/2024)   8.79%
(Libor + 6.00%/Q)
    2/28/2018     3.6     3.6 (2)(12)(15)      
        First lien senior secured loan ($10.2 par due 2/2024)   8.80%
(Libor + 6.00%/Q)
    2/28/2018     10.0     10.2 (2)(12)(15)      
                        13.6     13.8        
                                       
DRB Holdings, LLC(19)   Provider of integrated technology solutions to car wash operators   First lien senior secured revolving loan ($3.3 par due 10/2023)   8.78%
(Libor + 6.00%/Q)
    10/6/2017     3.3     3.3 (2)(15)      
        First lien senior secured loan ($23.7 par due 10/2023)   8.80%
(Libor + 6.00%/Q)
    10/6/2017     23.7     23.7 (3)(15)      
                        27.0     27.0        
                                     

F-14


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
DTI Holdco, Inc. and OPE DTI Holdings, Inc.(19)   Provider of legal process outsourcing and managed services   First lien senior secured revolving loan ($0.9 par due 9/2021)   6.93%
(Libor + 4.50%/M)
    9/23/2016     0.9     0.9 (2)(15)      
        First lien senior secured revolving loan ($1.3 par due 9/2021)   6.97%
(Libor + 4.50%/M)
    9/23/2016     1.3     1.3 (2)(15)      
        Class A common stock (7,500 shares)         8/19/2014     7.5     7.4 (2)      
        Class B common stock (7,500 shares)         8/19/2014         (2)      
                        9.7     9.6        
                                       
Emergency Communications Network, LLC(19)   Provider of mission critical emergency mass notification solutions   First lien senior secured loan ($25.1 par due 6/2023)   8.77%
(Libor + 6.25%/M)
    6/1/2017     25.0     24.4 (2)(15)      
        First lien senior secured loan ($19.7 par due 6/2023)   8.77%
(Libor + 6.25%/M)
    6/1/2017     19.6     19.2 (4)(15)      
                        44.6     43.6        
                                       
EN Engineering, L.L.C.(19)   National utility services firm providing engineering and consulting services to natural gas, electric power and other energy and industrial end markets   First lien senior secured loan ($0.3 par due 6/2021)   7.02%
(Libor + 4.50%/M)
    6/30/2015     0.3     0.3 (2)(15)      
        First lien senior secured loan ($6.8 par due 6/2021)   7.02%
(Libor + 4.50%/M)
    6/30/2015     6.8     6.8 (2)(15)      
                        7.1     7.1        
                                       
Entertainment Partners, LLC and Entertainment Partners Canada Inc.(19)   Provider of entertainment workforce and production management solutions   First lien senior secured loan ($1.4 par due 5/2022)   7.77%
(CIBOR + 5.50%/M)
    5/8/2017     1.4     1.4 (2)(8)(15)      
        First lien senior secured loan ($2.6 par due 5/2022)   7.71%
(Libor + 5.50%/M)
    5/8/2017     2.6     2.6 (2)(8)(15)      
        First lien senior secured loan ($2.6 par due 5/2022)   7.85%
(Libor + 5.50%/M)
    5/8/2017     2.6     2.6 (2)(8)(15)      
        First lien senior secured loan ($0.3 par due 5/2023)   8.34%
(Libor + 5.75%/Q)
    5/8/2017     0.3     0.3 (2)(15)      
        First lien senior secured loan ($26.4 par due 5/2023)   8.34%
(Libor + 5.75%/Q)
    5/8/2017     26.4     26.4 (3)(15)      
        First lien senior secured loan ($0.3 par due 5/2023)   8.55%
(Libor + 5.75%/Q)
    5/8/2017     0.3     0.3 (2)(15)      
        First lien senior secured loan ($22.0 par due 5/2023)   8.55%
(Libor + 5.75%/Q)
    5/8/2017     22.0     22.0 (3)(15)      
        First lien senior secured loan ($0.3 par due 5/2023)   8.59%
(Libor + 5.75%/Q)
    5/8/2017     0.3     0.3 (2)(15)      
        First lien senior secured loan ($26.4 par due 5/2023)   8.59%
(Libor + 5.75%/Q)
    5/8/2017     26.4     26.4 (3)(15)      
                        82.3     82.3        
                                       
Episerver Inc. and Goldcup 17308 AB(8)(19)   Provider of web content management and digital commerce solutions   First lien senior secured loan ($27.7 par due 10/2024)   8.27%
(Libor + 5.75%/M)
    10/9/2018     27.7     27.4 (2)(15)      
                                       
First Insight, Inc.   Software company providing merchandising and pricing solutions to companies worldwide   Warrant to purchase up to 122,827 units of Series C preferred stock (expires 3/2024)         3/20/2014         (2)      
                                     

F-15


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Foundation Risk Partners, Corp.(19)   Full service independent insurance agency   First lien senior secured loan ($7.8 par due 11/2023)   7.10%
(Libor + 4.75%/M)
    11/10/2017     7.8     7.8 (2)(15)      
        First lien senior secured loan ($1.0 par due 11/2023)   7.17%
(Libor + 4.75%/Q)
    8/9/2018     1.0     1.0 (2)(15)      
        First lien senior secured loan ($3.4 par due 11/2023)   7.34%
(Libor + 4.75%/Q)
    8/9/2018     3.4     3.4 (2)(15)      
        First lien senior secured loan ($5.2 par due 11/2023)   7.21%
(Libor + 4.75%/Q)
    8/9/2018     5.2     5.2 (2)(15)      
        First lien senior secured loan ($22.3 par due 11/2023)   7.10%
(Libor + 4.75%/M)
    11/10/2017     22.3     22.3 (3)(15)      
        Second lien senior secured loan ($3.0 par due 11/2024)   10.92%
(Libor + 8.50%/Q)
    8/9/2018     3.0     3.0 (2)(15)      
        Second lien senior secured loan ($12.4 par due 11/2024)   11.09%
(Libor + 8.50%/Q)
    8/9/2018     12.4     12.4 (2)(15)      
        Second lien senior secured loan ($19.1 par due 11/2024)   10.96%
(Libor + 8.50%/Q)
    8/9/2018     19.1     19.1 (2)(15)      
        Second lien senior secured loan ($27.5 par due 11/2024)   10.85%
(Libor + 8.50%/M)
    11/10/2017     27.5     27.5 (2)(15)      
                        101.7     101.7        
                                       
Genesis Acquisition Co. and Genesis Holding Co.(19)   Child care management software and services provider   First lien senior secured loan ($5.5 par due 7/2024)   6.52%
(Libor + 4.00%/M)
    7/31/2018     5.5     5.4 (2)(15)      
        Second lien senior secured loan ($25.8 par due 7/2025)   10.02%
(Libor + 7.50%/M)
    7/31/2018     25.8     25.4 (2)(15)      
        Class A common stock (8 shares)         7/31/2018     0.8     0.8 (2)      
                        32.1     31.6        
                                       
GTCR-Ultra Holdings III, LLC and GTCR-Ultra Holdings LLC(19)   Provider of payment processing and merchant acquiring solutions   First lien senior secured loan ($6.5 par due 8/2024)   7.77%
(Libor + 5.25%/M)
    12/31/2018     6.5     6.5 (2)(15)      
        Class A-2 units (911 units)         8/1/2017     0.9     1.3 (2)      
        Class B units (2,878,372 units)         8/1/2017         (2)      
                        7.4     7.8        
                                       
HAI Acquisition Corporation and Aloha Topco, LLC(19)   Professional employer organization offering human resources, compliance and risk management services   First lien senior secured loan ($66.2 par due 11/2024)   8.59%
(Libor + 6.00%/Q)
    11/1/2017     66.2     65.6 (3)(15)      
        Class A units (16,980 units)         11/1/2017     1.7     1.8 (2)      
                        67.9     67.4        
                                       
Help/Systems Holdings, Inc.(19)   Provider of IT operations management and cybersecurity software   First lien senior secured revolving loan ($1.0 par due 3/2023)   6.27%
(Libor + 3.75%/M)
    3/29/2018     1.0     1.0 (2)(15)      
                                       
IfByPhone Inc.   Voice-based marketing automation software provider   Warrant to purchase up to 124,300 shares of Series C preferred stock (expires 10/2022)         10/15/2012     0.1     0.1 (2)      
                                       
Implementation Management Assistance, LLC(19)   Revenue cycle consulting firm to the healthcare industry   First lien senior secured revolving loan ($5.5 par due 12/2023)   9.00%
(Base Rate + 3.50%/Q)
    12/13/2017     5.5     5.5 (2)(15)      
        First lien senior secured loan ($17.0 par due 12/2023)   7.30%
(Libor + 4.50%/Q)
    12/13/2017     17.0     16.8 (2)(15)      
                        22.5     22.3        
                                       
Infinite Electronics, Inc.(19)   Manufacturer and distributor of radio frequency and microwave electronic components   First lien senior secured revolving loan       7/2/2018         (17)      
        First lien senior secured loan ($10.3 par due 7/2025)   6.52%
(Libor + 4.00%/M)
    7/2/2018     10.3     10.2 (2)(15)      
                        10.3     10.2        
                                     

F-16


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Infogix, Inc. and Infogix Parent Corporation(19)   Enterprise data analytics and integrity software solutions provider   Series A preferred stock (2,475 shares)         1/3/2017     2.5     2.5        
        Common stock (1,297,768 shares)         1/3/2017                
                        2.5     2.5        
                                       
Inmar, Inc.   Technology-driven solutions provider for retailers, wholesalers and manufacturers   Second lien senior secured loan ($28.3 par due 5/2025)   10.52%
(Libor + 8.00%/M)
    4/25/2017     27.9     28.3 (2)(15)      
                                       
InterVision Systems, LLC and InterVision Holdings, LLC   Provider of cloud based IT solutions, infrastructure and services   First lien senior secured loan ($16.4 par due 5/2022)   10.55%
(Libor + 8.08%/M)
    5/31/2017     16.4     15.9 (2)(15)      
        First lien senior secured loan ($24.7 par due 5/2022)   10.24%
(Libor + 7.72%/M)
    5/31/2017     24.7     24.0 (2)(15)      
        First lien senior secured loan ($10.0 par due 5/2022)   10.24%
(Libor + 7.72%/M)
    5/31/2017     10.0     9.7 (4)(15)      
        Class A membership units (1,000 units)         5/31/2017     1.0     0.6        
                        52.1     50.2        
                                       
iParadigms Holdings, LLC   Anti-plagiarism software provider to the education market   Second lien senior secured loan ($32.5 par due 7/2022)   10.05%
(Libor + 7.25%/Q)
    1/3/2017     32.0     32.5 (2)(15)      
                                       
iPipeline, Inc., Internet Pipeline, Inc., iPipeline Limited and iPipeline Holdings, Inc.(19)   Provider of SaaS-based software solutions to the insurance and financial services industry   First lien senior secured loan ($11.2 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    12/18/2017     11.8     11.2 (2)(8)(15)      
        First lien senior secured loan ($7.4 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    6/15/2017     7.4     7.4 (2)(15)      
        First lien senior secured loan ($9.0 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    9/15/2017     9.0     9.0 (2)(15)      
        First lien senior secured loan ($16.2 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    8/4/2015     16.2     16.2 (3)(15)      
        First lien senior secured loan ($14.5 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    8/4/2015     14.5     14.5 (4)(15)      
        Preferred stock (1,100 shares)         8/4/2015     1.1     4.3 (2)      
        Common stock (668,781 shares)         8/4/2015         (2)      
                        60.0     62.6        
                                       
IQMS   Provider of enterprise resource planning and manufacturing execution software for small and midsized manufacturers   First lien senior secured loan ($22.5 par due 3/2022)   12.75%
(Base Rate + 7.25%/Q)
    3/28/2017     22.5     22.5 (3)(15)      
        First lien senior secured loan ($14.9 par due 3/2022)   12.75%
(Base Rate + 7.25%/Q)
    3/28/2017     14.9     14.9 (4)(15)      
                        37.4     37.4        
                                       
IRI Holdings, Inc., IRI Group Holdings, Inc. and IRI Parent, L.P.   Market research company focused on the consumer packaged goods industry   First lien senior secured loan ($79.0 par due 11/2025)   7.02%
(Libor + 4.50%/M)
    11/30/2018     78.2     77.4 (2)(15)      
        Second lien senior secured loan ($86.8 par due 11/2026)   10.52%
(Libor + 8.00%/M)
    11/30/2018     85.3     85.1 (2)(15)      
        Series A-1 preferred shares (46,900 shares)   13.39%PIK
(Libor + 10.50%/S)
    11/30/2018     46.2     46.9 (2)(15)      
        Class A-1 common units (90,500 units)         11/30/2018     9.1     9.1 (2)      
                        218.8     218.5        
                                       
Kaufman, Hall & Associates, LLC(19)   Provider of specialty advisory services and software solutions to the healthcare market   First lien senior secured loan ($25.0 par due 5/2025)   7.64%
(Libor + 5.25%/M)
    11/9/2018     25.0     24.8 (2)(15)      
                                       
Labstat International Inc.(8)(19)   Lab testing services for nicotine containing products   First lien senior secured loan ($5.0 par due 6/2024)   8.55%
(CIBOR + 6.25%/Q)
    10/19/2018     5.2     5.0 (2)(15)      
        First lien senior secured loan ($19.2 par due 6/2024)   8.55%
(CIBOR + 6.25%/Q)
    6/25/2018     19.8     19.2 (2)(15)      
                        25.0     24.2        
                                     

F-17


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
LLSC Holdings Corporation (dba Lawrence Merchandising Services)(7)   Marketing services provider   Series A preferred stock (9,000 shares)         1/3/2017     1.8     0.4        
        Common stock (1,000 shares)         1/3/2017                
                        1.8     0.4        
                                       
Masergy Holdings, Inc.(19)   Provider of software-defined solutions for enterprise global networks, cyber security, and cloud communications   First lien senior secured revolving loan ($0.2 par due 12/2021)   6.02%
(Libor + 3.50%/M)
    2/8/2018     0.2     0.1 (2)(15)(18)      
                                       
Ministry Brands, LLC and MB Parent HoldCo, L.P. (dba Community Brands)(19)   Software and payment services provider to faith-based institutions   First lien senior secured loan ($4.9 par due 12/2022)   6.52%
(Libor + 4.00%/M)
    8/22/2017     4.9     4.9 (2)(15)      
        First lien senior secured loan ($10.5 par due 12/2022)   6.52%
(Libor + 4.00%/M)
    4/6/2017     10.5     10.5 (2)(15)      
        First lien senior secured loan ($14.5 par due 12/2022)   6.52%
(Libor + 4.00%/M)
    4/6/2017     14.4     14.5 (2)(15)      
        Second lien senior secured loan ($16.6 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    12/2/2016     16.6     16.6 (2)(15)      
        Second lien senior secured loan ($17.9 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    8/22/2017     17.9     17.9 (2)(15)      
        Second lien senior secured loan ($4.7 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    4/6/2017     4.7     4.7 (2)(15)      
        Second lien senior secured loan ($7.0 par due 6/2023)   10.52%
(Libor + 8.00%/M)
    4/18/2018     7.0     7.0 (2)(15)      
        Second lien senior secured loan ($9.2 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    4/6/2017     9.2     9.2 (2)(15)      
        Second lien senior secured loan ($38.6 par due 6/2023)   10.52%
(Libor + 8.00%/M)
    4/18/2018     38.6     38.6 (2)(15)      
        Second lien senior secured loan ($75.0 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    12/2/2016     74.5     75.0 (2)(15)      
        Second lien senior secured loan ($15.0 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    12/2/2016     14.9     15.0 (3)(15)      
        Class A units (500,000 units)         12/2/2016     5.0     6.8 (2)      
                        218.2     220.7        
                                       
MVL Group, Inc.(7)   Marketing research provider   Common stock (560,716 shares)         4/1/2010         (2)      
                                       
NAS, LLC, Nationwide Marketing Group, LLC and Nationwide Administrative Services, Inc.   Buying and marketing services organization for appliance, furniture and consumer electronics dealers   Second lien senior secured loan ($24.1 par due 12/2021)   11.15%
(Libor + 8.75%/Q)
    6/1/2015     24.1     24.1 (2)(15)      
        Second lien senior secured loan ($7.0 par due 12/2021)   11.14%
(Libor + 8.75%/Q)
    6/1/2015     7.0     7.0 (2)(15)      
                        31.1     31.1        
                                       
Novetta Solutions, LLC   Provider of advanced analytics solutions for the government, defense and commercial industries   First lien senior secured loan ($8.6 par due 10/2022)   7.53%
(Libor + 5.00%/M)
    1/3/2017     8.4     8.4 (2)(15)      
        Second lien senior secured loan ($31.0 par due 10/2023)   11.03%
(Libor + 8.50%/M)
    1/3/2017     28.8     28.5 (2)(15)      
                        37.2     36.9        
                                       
NSM Insurance Group, LLC   Insurance program administrator   First lien senior secured loan ($6.7 par due 5/2024)   7.30%
(Libor + 4.50%/Q)
    5/11/2018     6.7     6.7 (2)(15)      
        First lien senior secured loan ($10.2 par due 5/2024)   7.30%
(Libor + 4.50%/Q)
    12/3/2018     10.2     10.2 (2)(15)      
        First lien senior secured loan ($13.1 par due 5/2024)   7.30%
(Libor + 4.50%/Q)
    5/11/2018     13.1     13.1 (3)(15)      
                        30.0     30.0        
                                       
PayNearMe, Inc.   Electronic cash payment system provider   Warrant to purchase up to 195,726 shares of Series E preferred stock (expires 3/2023)         3/11/2016     0.2     (2)      
                                     

F-18


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
PDI TA Holdings, Inc.(19)   Provider of enterprise management software for the convenience retail and petroleum wholesale markets   First lien senior secured loan ($5.0 par due 10/2024)   6.90%
(Libor + 4.50%/Q)
    4/11/2018     5.0     5.0 (2)(15)      
        First lien senior secured loan ($0.4 par due 10/2024)   7.21%
(Libor + 4.50%/Q)
    4/11/2018     0.4     0.4 (2)(15)      
        First lien senior secured loan ($5.1 par due 10/2024)   6.92%
(Libor + 4.50%/Q)
    8/25/2017     5.1     5.1 (2)(15)      
        First lien senior secured loan ($2.7 par due 10/2024)   7.04%
(Libor + 4.50%/Q)
    8/25/2017     2.7     2.7 (2)(15)      
        First lien senior secured loan ($23.4 par due 10/2024)   7.30%
(Libor + 4.50%/Q)
    8/25/2017     23.4     23.4 (2)(15)      
        First lien senior secured loan ($4.3 par due 10/2024)   6.11%
(Libor + 4.50%/Q)
    10/24/2018     4.3     4.3 (2)(15)      
        First lien senior secured loan ($45.0 par due 10/2024)   7.23%
(Libor + 4.75%/Q)
    10/24/2018     45.0     45.0 (2)(15)      
        Second lien senior secured loan ($8.2 par due 10/2025)   11.04%
(Libor + 8.50%/Q)
    8/25/2017     8.2     8.2 (2)(15)      
        Second lien senior secured loan ($6.5 par due 10/2025)   10.91%
(Libor + 8.50%/Q)
    8/25/2017     6.5     6.5 (2)(15)      
        Second lien senior secured loan ($1.9 par due 10/2025)   10.98%
(Libor + 8.50%/Q)
    8/25/2017     1.9     1.9 (2)(15)      
        Second lien senior secured loan ($23.2 par due 10/2025)   11.00%
(Libor + 8.50%/Q)
    8/25/2017     23.2     23.2 (2)(15)      
        Second lien senior secured loan ($6.4 par due 10/2025)   11.11%
(Libor + 8.50%/Q)
    10/24/2018     6.4     6.4 (2)(15)      
        Second lien senior secured loan ($52.9 par due 10/2025)   10.99%
(Libor + 8.50%/Q)
    10/24/2018     52.9     52.9 (2)(15)      
        Second lien senior secured loan ($16.7 par due 10/2025)   11.17%
(Libor + 8.75%/Q)
    4/11/2018     16.7     16.7 (2)(15)      
        Second lien senior secured loan ($66.8 par due 10/2025)   11.21%
(Libor + 8.50%/Q)
    8/25/2017     66.8     66.8 (2)(15)      
                        268.5     268.5        
                                       
PHL Investors, Inc., and PHL Holding Co.(7)   Mortgage services   Class A common stock (576 shares)         7/31/2012     3.8     (2)      
                                       
PHNTM Holdings, Inc. and Planview Parent, Inc.   Provider of project and portfolio management software   First lien senior secured loan ($1.4 par due 1/2023)   7.77%
(Libor + 5.25%/M)
    1/27/2017     1.4     1.4 (2)(15)      
        Second lien senior secured loan ($62.0 par due 7/2023)   12.27%
(Libor + 9.75%/M)
    1/27/2017     61.3     62.0 (2)(15)      
        Class A common shares (990 shares)         1/27/2017     1.0     1.1 (2)      
        Class B common shares (168,329 shares)         1/27/2017         0.2 (2)      
                        63.7     64.7        
                                       
Poplicus Incorporated   Business intelligence and market analytics platform for companies that sell to the public sector   Warrant to purchase up to 2,402,991 shares of Series C preferred stock (expires 6/2025)         6/25/2015     0.1     (2)      
                                       
Production Resource Group, L.L.C.   Provider of rental equipment, labor, production management, scenery, and other products to various entertainment end-markets   First lien senior secured loan ($21.0 par due 8/2024)   9.65%
(Libor + 7.00%/Q)
    8/21/2018     21.0     20.6 (2)(15)      
        First lien senior secured loan ($80.0 par due 8/2024)   9.65%
(Libor + 7.00%/Q)
    8/21/2018     80.0     78.4 (3)(15)      
                        101.0     99.0        
                                       
Project Alpha Intermediate Holding, Inc. and Qlik Parent, Inc.   Provider of data visualization software for data analytics   Class A common shares (7,445 shares)         8/22/2016     7.4     9.6 (2)      
        Class B common shares (1,841,609 shares)         8/22/2016     0.1     0.1 (2)      
                        7.5     9.7        
                                       
R2 Acquisition Corp.   Marketing services   Common stock (250,000 shares)         5/29/2007     0.3     0.2 (2)      
                                     

F-19


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
SCM Insurance Services Inc.(8)(19)   Provider of claims management, claims investigation & support and risk management solutions for the Canadian property and casualty insurance industry   First lien senior secured revolving loan ($2.4 par due 8/2022)   7.95%
(Base Rate + 4.00%/Q)
    8/29/2017     2.5     2.4 (2)(15)      
        First lien senior secured loan ($19.5 par due 8/2024)   7.28%
(CIBOR + 5.00%/M)
    8/29/2017     21.3     18.9 (2)(15)      
        Second lien senior secured loan ($55.6 par due 3/2025)   11.28%
(CIBOR + 9.00%/M)
    8/29/2017     60.5     52.3 (2)(15)      
                        84.3     73.6        
                                       
SpareFoot, LLC(19)   PMS solutions and web services for the self-storage industry.   First lien senior secured revolving loan ($0.3 par due 4/2023)   6.77%
(Libor + 4.25%/M)
    4/13/2018     0.3     0.3 (2)(15)      
        First lien senior secured loan ($1.2 par due 4/2024)   6.77%
(Libor + 4.25%/M)
    8/31/2018     1.1     1.2 (2)(15)      
        First lien senior secured loan ($4.7 par due 4/2024)   6.77%
(Libor + 4.25%/M)
    4/13/2018     4.6     4.7 (2)(15)      
        Second lien senior secured loan ($4.2 par due 4/2025)   10.77%
(Libor + 8.25%/M)
    8/31/2018     4.1     4.2 (2)(15)      
        Second lien senior secured loan ($6.1 par due 4/2025)   10.77%
(Libor + 8.25%/M)
    4/13/2018     6.0     6.1 (2)(15)      
                        16.1     16.5        
                                       
Sparta Systems, Inc., Project Silverback Holdings Corp. and Silverback Holdings, Inc.(19)   Quality management software provider   Second lien senior secured loan ($20.0 par due 8/2025)   10.76%
(Libor + 8.25%/M)
    8/21/2017     19.7     17.4 (2)(15)      
        Series B preferred shares (10,084 shares)         8/21/2017     1.1     0.5        
                        20.8     17.9        
                                       
Syntax USA Acquisition Corporation(8)(19)   Provider of cloud ERP hosting and consulting services for Oracle users   First lien senior secured revolving loan ($1.8 par due 4/2021)   6.67%
(Libor + 4.25%/S)
    2/8/2018     1.8     1.7 (2)(15)      
                                       
Telestream Holdings Corporation(19)   Provider of digital video tools and workflow solutions to the media and entertainment industries   First lien senior secured revolving loan ($0.5 par due 3/2022)   10.95%
(Base Rate + 5.45%/Q)
    2/8/2018     0.5     0.5 (2)(15)(18)      
                                       
TU BidCo, Inc.(19)   Provider of outsourced customer service management solutions and back-office support services to e-commerce, software and tech-enabled services industries   First lien senior secured loan ($18.1 par due 10/2023)   6.80%
(Libor + 4.00%/Q)
    10/1/2018     18.1     18.0 (3)(15)      
                                     

F-20


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
UL Holding Co., LLC(6)   Provider of collection and landfill avoidance solutions for food waste and unsold food products   Senior subordinated loan ($3.2 par due 5/2020)   10.00% PIK     4/30/2012     1.1     3.2 (2)      
        Senior subordinated loan ($0.4 par due 5/2020)         4/30/2012     0.2     0.4 (2)      
        Senior subordinated loan ($6.8 par due 5/2020)   10.00% PIK     4/30/2012     2.5     6.8 (2)      
        Senior subordinated loan ($0.5 par due 5/2020)         4/30/2012     0.2     0.5 (2)      
        Senior subordinated loan ($27.1 par due 5/2020)   10.00% PIK     4/30/2012     9.9     27.1 (2)      
        Senior subordinated loan ($3.8 par due 5/2020)         4/30/2012     1.4     3.8 (2)      
        Class A common units (533,351 units)         6/17/2011     5.0     0.3 (2)      
        Class B-5 common units (272,834 units)         6/17/2011     2.5     0.2 (2)      
        Class C common units (758,546 units)         4/25/2008         (2)      
        Warrant to purchase up to 719,044 shares of Class A units         5/2/2014         (2)      
        Warrant to purchase up to 28,663 shares of Class B-1 units         5/2/2014         (2)      
        Warrant to purchase up to 57,325 shares of Class B-2 units         5/2/2014         (2)      
        Warrant to purchase up to 29,645 shares of Class B-3 units         5/2/2014         (2)      
        Warrant to purchase up to 80,371 shares of Class B-5 units         5/2/2014         (2)      
        Warrant to purchase up to 59,655 shares of Class B-6 units         5/2/2014         (2)      
        Warrant to purchase up to 1,046,713 shares of Class C units         5/2/2014         (2)      
                        22.8     42.3        
                                       
Velocity Holdings Corp.   Hosted enterprise resource planning application management services provider   Common units (1,713,546 units)         12/13/2013     4.5     3.6        
                                       
Visual Edge Technology, Inc.(19)   Provider of outsourced office solutions with a focus on printer and copier equipment and other parts and supplies   First lien senior secured loan ($15.7 par due 8/2022)   8.27%
(Libor + 5.75%/M)
    8/31/2017     15.6     15.7 (2)(15)      
        First lien senior secured loan ($16.7 par due 8/2022)   8.27%
(Libor + 5.75%/M)
    8/31/2017     16.7     16.7 (2)(15)      
        Senior subordinated loan ($56.0 par due 9/2024)   12.50% PIK     8/31/2017     52.7     56.0 (2)      
        Warrant to purchase up to 1,816,089 shares of common stock (expires 8/2027)         8/31/2017         0.8 (2)      
        Warrant to purchase up to 2,070,511 shares of preferred stock (expires 8/2027)         8/31/2017     3.9     3.9 (2)      
                        88.9     93.1        
                                     

F-21


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
VRC Companies, LLC(19)   Provider of records and information management services   First lien senior secured revolving loan ($0.6 par due 3/2022)   9.02%
(Libor + 6.50%/M)
    4/17/2017     0.6     0.6 (2)(15)      
        First lien senior secured revolving loan ($0.2 par due 3/2022)   11.00%
(Base Rate + 5.50%/M)
    4/17/2017     0.2     0.2 (2)(15)      
        First lien senior secured loan ($2.3 par due 3/2023)   9.02%
(Libor + 6.50%/M)
    3/31/2017     2.3     2.3 (2)(15)      
        First lien senior secured loan ($0.2 par due 3/2023)   9.11%
(Libor + 6.50%/S)
    9/28/2018     0.2     0.2 (2)(15)      
        First lien senior secured loan ($5.0 par due 3/2023)   9.02%
(Libor + 6.50%/S)
    9/28/2018     5.0     5.0 (2)(15)      
                        8.3     8.3        
                                       
WorldPay Group PLC(8)   Payment processing company   C2 shares (73,974 shares)         10/21/2015         (22)      
                                       
Worldwide Facilities, LLC(19)   Specialty insurance wholesale broker   First lien senior secured revolving loan ($0.4 par due 4/2024)   6.77%
(Libor + 4.25%/M)
    5/3/2018     0.4     0.4 (2)(15)      
        First lien senior secured loan ($1.3 par due 4/2024)   7.05%
(Libor + 4.25%/Q)
    5/3/2018     1.3     1.2 (2)(15)      
        First lien senior secured loan ($1.6 par due 4/2024)   7.05%
(Libor + 4.25%/Q)
    5/3/2018     1.6     1.6 (2)(15)      
                        3.3     3.2        
                                       
XIFIN, Inc.(19)   Revenue cycle management provider to labs   First lien senior secured revolving loan       2/8/2018         (17)      
                                       
Zywave, Inc.(19)   Provider of software and technology-enabled content and analytical solutions to insurance brokers   First lien senior secured revolving loan ($6.3 par due 11/2022)   7.52%
(Libor + 5.00%/M)
    11/17/2016     6.3     6.2 (2)(15)      
        Second lien senior secured loan ($27.0 par due 11/2023)   11.65%
(Libor + 9.00%/Q)
    11/17/2016     27.0     26.5 (2)(15)      
                        33.3     32.7        
                        2,214.4     2,219.0     30.41 %
                                       
Consumer Products                                      
Badger Sportswear Acquisition, Inc.   Provider of team uniforms and athletic wear   Second lien senior secured loan ($56.8 par due 3/2024)   11.51%
(Libor + 9.00%/M)
    9/6/2016     56.7     56.8 (2)(15)      
                                       
BRG Sports, Inc.   Designer, manufacturer and licensor of branded sporting goods   Preferred stock (2,009 shares)         1/3/2017                
        Common stock (6,566,655 shares)         1/3/2017         0.2        
                            0.2        
                                       
Centric Brands Inc. (fka Differential Brands Group(19)   Designer, marketer and distributor of licensed and owned apparel   First lien senior secured loan ($58.8 par due 10/2023)   8.51%
(Libor + 6.00%/Q)
    10/29/2018     58.8     58.2 (3)(15)      
        Common stock (3,077,875 shares)         10/29/2018     24.6     24.6 (2)      
                        83.4     82.8        
                                       
CB Trestles OpCo, LLC(19)   Apparel retailer   First lien senior secured loan ($26.5 par due 10/2024)   8.51%
(Libor + 5.75%/S)
    10/26/2018     26.5     26.3 (3)(15)      
                                       
Consumer Health Parent LLC   Developer and marketer of over-the-counter cold remedy products   Preferred units (1,072 units)         12/15/2017     1.1     0.9 (2)      
        Series A units (1,072 units)         12/15/2017         (2)      
                        1.1     0.9        
                                       
Feradyne Outdoors, LLC and Bowhunter Holdings, LLC   Provider of branded archery and bowhunting accessories   Common units (421 units)         4/24/2014     4.2     0.2 (2)      
                                     

F-22


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Implus Footcare, LLC   Provider of footwear and other accessories   First lien senior secured loan ($14.2 par due 4/2021)   9.55%
(Libor + 6.75%/Q)
    6/1/2017     14.2     14.2 (2)(15)      
        First lien senior secured loan ($5.0 par due 4/2021)   9.55%
(Libor + 6.75%/Q)
    7/17/2018     5.0     5.0 (2)(15)      
        First lien senior secured loan ($76.4 par due 4/2021)   9.55%
(Libor + 6.75%/Q)
    6/1/2017     76.4     76.4 (2)(15)      
        First lien senior secured loan ($19.3 par due 4/2021)   9.55%
(Libor + 6.75%/Q)
    6/1/2017     19.3     19.3 (4)(15)      
        First lien senior secured loan ($0.2 par due 4/2021)   9.55%
(Libor + 6.75%/Q)
    6/30/2016     0.2     0.2 (2)(15)      
                        115.1     115.1        
                                       
Indra Holdings Corp.   Designer, marketer, and distributor of rain and cold weather products   First lien senior secured loan ($10.0 par due 5/2021)   6.77%
(Libor + 4.25%/M)
    1/22/2018     6.8     6.2 (2)(15)      
        Second lien senior secured loan ($80.0 par due 11/2021)         5/1/2014     68.1     19.9 (2)(15)      
                        74.9     26.1        
                                       
Plantation Products, LLC, Seed Holdings, Inc. and Flora Parent, Inc.   Provider of branded lawn and garden products   Second lien senior secured loan ($56.0 par due 6/2021)   9.92%
(Libor + 7.39%/Q)
    12/23/2014     55.9     56.0 (3)(15)      
        Second lien senior secured loan ($10.0 par due 6/2021)   9.92%
(Libor + 7.39%/Q)
    12/23/2014     10.0     10.0 (4)(15)      
        Common stock (30,000 shares)         12/23/2014     3.0     6.2 (2)      
                        68.9     72.2        
                                       
Rug Doctor, LLC and RD Holdco Inc.(7)   Manufacturer and marketer of carpet cleaning machines   Second lien senior secured loan ($16.9 par due 10/2019)   12.33%
(Libor + 9.75%/Q)
    1/3/2017     16.9     16.9 (2)(15)      
        Common stock (458,596 shares)         1/3/2017     14.0     11.1        
        Warrant to purchase up to 56,372 shares of common stock (expires 12/2023)         1/3/2017                
                        30.9     28.0        
                                       
S Toys Holdings LLC (fka The Step2 Company, LLC)(7)   Toy manufacturer   Common units (1,116,879 units)         4/1/2011         0.4        
        Class B common units (126,278,000 units)         10/30/2014         (2)      
        Warrant to purchase up to 3,157,895 units         4/1/2010                
                            0.4        
                                       
SHO Holding I Corporation   Manufacturer and distributor of slip resistant footwear   Second lien senior secured loan ($100.0 par due 4/2023)   11.03%
(Libor + 8.50%/Q)
    10/27/2015     98.5     91.0 (2)(15)      
                                       
Shock Doctor, Inc. and Shock Doctor Holdings, LLC(6)   Developer, marketer and distributor of sports protection equipment and accessories   Second lien senior secured loan ($89.4 par due 10/2021)   13.49%
(Libor + 11.00%/Q)
    4/22/2015     89.4     79.6 (2)(15)      
        Class A preferred units (50,000 units)         3/14/2014     5.0     1.0 (2)      
        Class C preferred units (50,000 units)         4/22/2015     5.0     1.0 (2)      
                        99.4     81.6        
                                       
Singer Sewing Company, SVP-Singer Holdings, LLC and SVP-Singer Holdings LP(7)(19)   Manufacturer of consumer sewing machines   First lien senior secured revolving loan ($72.6 par due 3/2023)   11.39%
(Libor + 9.00%/Q)
    7/26/2017     72.6     72.6 (2)(15)(18)      
        First lien senior secured revolving loan ($4.0 par due 3/2023)   11.38%
(Libor + 9.00%/Q)
    7/26/2017     4.0     4.0 (2)(15)(18)      
        First lien senior secured loan ($180.9 par due 3/2023)   5.00%
(Libor + 2.61%/Q)
    7/26/2017     174.6     159.1 (2)(15)      
        Class A common units (6,500,000 units)         7/26/2017         (2)      
                        251.2     235.7        
                                     

F-23


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Touchstone Acquisition, Inc. and Touchstone Holding, L.P.(19)   Manufacturer of consumable products in the dental, medical, cosmetic and CPG/industrial end-markets   First lien senior secured loan ($53.7 par due 11/2025)   7.27%
(Libor + 4.75%/M)
    11/15/2018     53.7     53.2 (2)(15)      
        Class A preferred units (2,149 units)         11/15/2018     2.1     2.1 (2)      
                        55.8     55.3        
                                       
Varsity Brands Holding Co., Inc. and BCPE Hercules Holdings, LP   Leading manufacturer and distributor of textiles, apparel & luxury goods   Second lien senior secured loan ($21.1 par due 12/2025)   10.77%
(Libor + 8.25%/M)
    7/30/2018     21.1     21.1 (2)(15)      
        Second lien senior secured loan ($47.7 par due 12/2025)   10.77%
(Libor + 8.25%/M)
    12/15/2017     47.7     47.7 (2)(15)      
        Second lien senior secured loan ($75.0 par due 12/2025)   10.77%
(Libor + 8.25%/M)
    12/15/2017     75.0     75.0 (3)(15)      
        Class A units (1,400 units)         7/30/2018     1.4     1.5 (2)      
                        145.2     145.3        
                                       
Woodstream Group, Inc. and Woodstream Corporation(19)   Pet products manufacturer   First lien senior secured loan ($1.5 par due 5/2022)   8.72%
(Libor + 6.25%/Q)
    6/21/2017     1.5     1.5 (2)(15)      
        First lien senior secured loan ($0.9 par due 5/2022)   8.90%
(Libor + 6.25%/Q)
    6/21/2017     0.9     0.9 (2)(15)      
        First lien senior secured loan ($1.5 par due 5/2022)   9.04%
(Libor + 6.25%/Q)
    6/21/2017     1.5     1.5 (2)(15)      
        First lien senior secured loan ($3.1 par due 5/2022)   8.72%
(Libor + 6.25%/Q)
    6/21/2017     3.1     3.1 (4)(15)      
        First lien senior secured loan ($1.8 par due 5/2022)   8.90%
(Libor + 6.25%/Q)
    6/21/2017     1.8     1.8 (4)(15)      
        First lien senior secured loan ($3.1 par due 5/2022)   9.04%
(Libor + 6.25%/Q)
    6/21/2017     3.1     3.1 (4)(15)      
                        11.9     11.9        
                        1,123.7     1,029.8     14.11 %
                                       
Financial Services                                      
Amynta Agency Borrower Inc. and Amynta Warranty Borrower Inc.   Insurance service provider   First lien senior secured loan ($27.2 par due 2/2025)   6.52%
(Libor + 4.00%/M)
    12/21/2018     27.2     26.9 (2)(15)      
                                       
Commercial Credit Group, Inc.   Commercial equipment finance and leasing company   Senior subordinated loan ($28.0 par due 8/2022)   12.10%
(Libor + 9.75%/M)
    5/10/2012     28.0     28.0 (2)(15)      
                                       
DFC Global Facility Borrower II LLC(19)   Non-bank provider of alternative financial services   First lien senior secured revolving loan ($94.6 par due 9/2022)   13.10%
(Libor + 10.75%/M)
    9/27/2017     94.6     94.6 (2)(15)      
                                       
Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.(6)   Debt collection services provider   Common stock (180 shares)         1/11/2017         (2)      
                                       
Gordian Group, LLC   Provider of products, services and software to organizations pursuing efficient and effective procurement and information solutions   Common stock (526 shares)         11/30/2012         (2)      
                                       
Ivy Hill Asset Management, L.P.(7)(9)   Asset management services   Member interest (100.00% interest)         6/15/2009     444.0     517.9        
                                       
Javlin Three LLC, Javlin Four LLC, and Javlin Five LLC(9)   Asset-backed financial services company   First lien senior secured loan ($16.0 par due 6/2017)         6/24/2014     14.7     10.1 (2)(14)      
                                       
Joyce Lane Capital LLC and Joyce Lane Financing SPV LLC (fka Ciena Capital LLC)(7)(9)(19)   Specialty finance company   First lien senior secured revolving loan ($0.8 par due 12/2022)   6.81%
(Libor + 4.00%/Q)
    12/27/2018     0.8     0.8 (2)      
        Equity interests         11/29/2010     12.7     3.1 (2)      
                        13.5     3.9        

F-24


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
LS DE LLC and LM LSQ Investors LLC(9)   Asset based lender   Senior subordinated loan ($3.0 par due 6/2021)   10.50%     6/15/2017     3.0     3.0 (2)      
        Senior subordinated loan ($37.0 par due 3/2024)   10.50%     6/25/2015     37.0     37.0 (2)      
        Membership units (3,275,000 units)         6/25/2015     3.3     4.0        
                        43.3     44.0        
                                       
NM GRC HOLDCO, LLC(19)   Regulatory compliance services provider to financial institutions   First lien senior secured loan ($19.3 par due 2/2024)   8.80%
(Libor + 6.00%/Q)
    2/9/2018     19.3     19.3 (2)(15)      
        First lien senior secured loan ($60.6 par due 2/2024)   8.80%
(Libor + 6.00%/Q)
    2/9/2018     60.1     60.6 (2)(15)      
                        79.4     79.9        
                                       
Payment Alliance International, Inc.(19)   Reseller of ATM process services through 3rd party processing networks   First lien senior secured revolving loan ($1.3 par due 9/2021)   8.49%
(Libor + 6.05%/M)
    2/8/2018     1.3     1.3 (2)(15)      
        First lien senior secured revolving loan ($2.1 par due 9/2021)   10.30%
(Base Rate + 5.05%/M)
    2/8/2018     2.1     2.1 (2)(15)      
                        3.4     3.4        
                                       
Rialto Management Group, LLC(9)(19)   Investment and asset management platform focused on real estate   First lien senior secured loan ($1.0 par due 12/2024)   7.02%
(Libor + 4.50%/M)
    11/30/2018     1.0     1.0 (2)(15)      
                                       
Vela Trading Technologies, LLC(19)   Provider of market data software and content to global financial services clients   First lien senior secured revolving loan ($0.5 par due 6/2022)   7.65%
(Libor + 5.00%/Q)
    2/8/2018     0.5     0.5 (2)(15)      
        First lien senior secured loan ($4.9 par due 6/2022)   7.45%
(Libor + 5.00%/Q)
    4/17/2018     4.9     4.8 (2)(15)      
                        5.4     5.3        
                        754.5     815.0     11.16 %
Investment Funds and Vehicles                                      
ACAS Equity Holdings Corporation(7)(9)   Investment company   Common stock (589 shares)         1/3/2017     0.4     0.4        
                                       
Ares IIIR/IVR CLO Ltd.(7)(8)(9)   Investment vehicle   Subordinated notes ($20.0 par due 4/2021)         1/3/2017         0.1        
                                       
Blue Wolf Capital Fund II, L.P.(6)(8)(9)   Investment partnership   Limited partnership interest (8.50% interest)         1/3/2017     1.6     2.5 (22)      
                                       
Carlyle Global Market Strategies CLO 2015-3(8)(9)   Investment vehicle   Subordinated notes ($24.6 par due 7/2028)   13.70%     1/3/2017     14.7     17.1        
                                       
Centurion CDO 8 Limited(8)(9)   Investment vehicle   Subordinated notes ($5.0 par due 3/2019)         1/3/2017                
                                       
CoLTs 2005-1 Ltd.(7)(8)(9)   Investment vehicle   Preferred shares (360 shares)         1/3/2017                
                                       
CoLTs 2005-2 Ltd.(7)(8)(9)   Investment vehicle   Preferred shares (34,170,000 shares)         1/3/2017                
                                       
CREST Exeter Street Solar 2004-1(8)(9)   Investment vehicle   Preferred shares (3,500,000 shares)         1/3/2017                
                                       
Eaton Vance CDO X plc(8)(9)   Investment vehicle   Subordinated notes ($9.2 par due 2/2027)         1/3/2017         0.1        
                                       
European Capital UK SME Debt LP(6)(8)(9)(20)   Investment partnership   Limited partnership interest (45% interest)         1/3/2017     38.6     39.5        
                                       
HCI Equity, LLC(7)(8)(9)   Investment company   Member interest (100.00% interest)         4/1/2010         0.1 (22)      
                                       
Herbert Park B.V.(8)(9)   Investment vehicle   Subordinated notes ($6.1 par due 10/2026)         1/3/2017     0.9            

F-25


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Montgomery Lane, LLC and Montgomery Lane, Ltd.(7)(8)(9)   Investment company   Common stock (100 shares)         1/3/2017                
        Common stock (50,000 shares)         1/3/2017                
                                   
                                       
OHA Credit Partners XI(8)(9)   Investment vehicle   Subordinated notes ($17.8 par due 1/2032)   13.50%     1/3/2017     13.5     13.6        
                                       
Partnership Capital Growth Fund I, L.P.(6)(9)   Investment partnership   Limited partnership interest (25.00% interest)         6/16/2006         0.1 (2)(22)      
                                       
Partnership Capital Growth Investors III, L.P.(9)(20)   Investment partnership   Limited partnership interest (2.50% interest)         10/5/2011     2.5     4.2 (2)(22)      
                                       
PCG-Ares Sidecar Investment II, L.P.(6)(9)(20)   Investment partnership   Limited partnership interest (100.00% interest)         10/31/2014     6.7     17.4 (2)      
                                       
PCG-Ares Sidecar Investment, L.P.(6)(9)(20)   Investment partnership   Limited partnership interest (100.00% interest)         5/22/2014     4.5     4.4 (2)      
                                       
Piper Jaffray Merchant Banking Fund I, L.P.(9)(20)   Investment partnership   Limited partnership interest (2.00% interest)         8/16/2012     1.4     1.4 (22)      
                                       
Senior Direct Lending Program, LLC(7)(9)(21)   Co-investment vehicle   Subordinated certificates ($651.7 par due 12/2036)   10.81% (Libor + 8.00%/Q)(16)     7/27/2016     651.7     651.7 (15)      
        Member interest (87.50% interest)         7/27/2016         (15)      
                        651.7     651.7        
                                       
Vitesse CLO, Ltd.(8)(9)   Investment vehicle   Preferred shares (20,000,000 shares)         1/3/2017                
                                       
Voya CLO 2014-4 Ltd.(8)(9)   Investment vehicle   Subordinated notes ($26.7 par due 7/2031)   15.60%     1/3/2017     14.6     13.8        
                                       
VSC Investors LLC(9)   Investment company   Membership interest (1.95% interest)         1/24/2008     0.3     1.1 (2)(22)      
                        751.4     767.5     10.51 %
Manufacturing                                      
Chariot Acquisition, LLC(19)   Aftermarket golf cart parts and accessories   First lien senior secured loan ($18.2 par due 9/2021)   9.30% (Libor + 6.50%/Q)     1/3/2017     18.1     18.0 (3)(15)      
        First lien senior secured loan ($9.3 par due 9/2021)   9.30% (Libor + 6.50%/Q)     1/3/2017     9.2     9.2 (4)(15)      
                        27.3     27.2        
                                       
Dorner Holding Corp.(19)   Manufacturer of precision unit conveyors   First lien senior secured revolving loan ($0.2 par due 3/2022)   10.25% (Base Rate + 4.75%/Q)     3/15/2017     0.2     0.2 (2)(15)      
                                       
ECI Purchaser Company, LLC   Manufacturer of equipment to safely control pressurized gases   First lien senior secured loan ($21.8 par due 12/2019)   9.13% (Libor + 6.25%/Q)     7/26/2017     21.8     21.5 (2)(15)      
        First lien senior secured loan ($88.7 par due 12/2019)   8.15% (Libor + 5.25%/Q)     7/26/2017     88.7     87.8 (2)(15)      
        First lien senior secured loan ($74.8 par due 12/2019)   8.15% (Libor + 5.25%/Q)     7/26/2017     74.8     74.0 (3)(15)      
        First lien senior secured loan ($0.3 par due 12/2019)   9.13% (Libor + 6.25%/Q)     7/26/2017     0.3     0.3 (2)(15)      
        First lien senior secured loan ($0.2 par due 12/2019)   9.13% (Libor + 6.25%/Q)     7/26/2017     0.2     0.2 (3)(15)      
                        185.8     183.8        
                                       
ETG Holdings, Inc.(7)   Industrial woven products   Common stock (3,000 shares)         1/3/2017                

F-26


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Harvey Tool Company, LLC(19)   Cutting tool provider to the metalworking industry   First lien senior secured revolving loan ($0.7 par due 10/2023)   7.01% (Libor + 4.50%/M)     10/12/2017     0.7     0.7 (2)(15)(18)      
        First lien senior secured loan ($20.5 par due 10/2024)   7.55% (Libor + 4.75%/Q)     10/12/2017     20.5     20.5 (2)(15)      
        First lien senior secured loan ($19.8 par due 10/2024)   7.55% (Libor + 4.75%/Q)     10/12/2017     19.8     19.8 (4)(15)      
        Second lien senior secured loan ($43.7 par due 10/2025)   10.93% (Libor + 8.50%/Q)     10/12/2017     43.7     43.7 (2)(15)      
                        84.7     84.7        
                                       
Ioxus, Inc.(6)   Energy storage devices   First lien senior secured loan ($1.3 par due 12/2019)         4/29/2014     1.3     1.3 (2)      
        First lien senior secured loan ($5.7 par due 12/2019)   7.00% Cash, 5.00% PIK     4/29/2014     5.6     5.7 (2)      
        Series CC preferred stock (1,683,265 shares)         9/7/2017     0.7     (2)      
        Warrant to purchase up to 75,968 shares of common stock (expires 1/2026)         1/28/2016         (2)      
        Warrant to purchase up to 30,256 shares of Series BB preferred stock (expires 8/2026)         8/24/2016         (2)      
        Warrant to purchase up to 8,416,326 shares of Series CC preferred stock (expires 1/2027)         1/27/2017         (2)      
                        7.6     7.0        
                                       
KPS Global LLC and Cool Group LLC   Walk-in cooler and freezer systems   First lien senior secured loan ($1.6 par due 4/2022)   5.09% (Libor + 2.63%/M)     4/5/2017     1.6     1.6 (2)(15)      
        First lien senior secured loan ($4.4 par due 4/2022)   9.65% (Libor + 7.19%/M)     11/16/2018     4.4     4.4 (2)(15)      
        First lien senior secured loan ($10.5 par due 4/2022)   9.61% (Libor + 7.14%/M)     4/5/2017     10.5     10.5 (2)(15)      
        First lien senior secured loan ($5.2 par due 4/2022)   9.61% (Libor + 7.14%/M)     4/5/2017     5.2     5.2 (4)(15)      
        Class A units (13,292 units)         9/21/2018     1.1     1.4        
                        22.8     23.1        
                                       
Mac Lean-Fogg Company and MacLean-Fogg Holdings, L.L.C.(19)   Manufacturer and supplier for the power utility and automotive markets worldwide   First lien senior secured loan ($206.0 par due 12/2025)   7.55% (Libor + 4.75%/Q)     12/21/2018     205.0     204.0 (2)(15)      
        Preferred units (70,183 units)   4.50% Cash, 9.25% PIK     10/9/2015     79.2     79.2        
                        284.2     283.2        
                                       
Nordco Inc.(19)   Railroad maintenance-of-way machinery   First lien senior secured revolving loan ($1.3 par due 8/2020)   11.00% (Base Rate + 5.50%/M)     8/26/2015     1.3     1.2 (2)(15)(18)      
                                       
Pelican Products, Inc.   Flashlights   Second lien senior secured loan ($27.3 par due 5/2026)   10.13% (Libor + 7.75%/M)     5/4/2018     27.1     27.1 (2)(15)      
                                       
Sanders Industries Holdings, Inc. and SI Holdings, Inc.(19)   Elastomeric parts, mid-sized composite structures, and composite tooling   First lien senior secured loan ($50.2 par due 5/2020)   8.90% (Libor + 6.50%/Q)     7/21/2017     50.2     50.2 (2)(15)      
        First lien senior secured loan ($13.1 par due 5/2020)   8.90% (Libor + 6.50%/Q)     7/21/2017     13.1     13.1 (4)(15)      
        Common stock (1,500 shares)         5/30/2014     1.5     1.8 (2)      
                        64.8     65.1        
                                       
Saw Mill PCG Partners LLC   Metal precision engineered components   Common units (1,000 units)         1/30/2007     1.0     (2)      

F-27


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Sonny's Enterprises, LLC(19)   Manufacturer and supplier of car wash equipment, parts and supplies to the conveyorized car wash market   First lien senior secured revolving loan ($0.2 par due 12/2022)   6.77% (Libor + 4.25%/M)     11/30/2017     0.2     0.2 (2)(15)      
                                       
Sunk Rock Foundry Partners LP, Hatteras Electrical Manufacturing Holding Company and Sigma Electric Manufacturing Corporation(19)   Manufacturer of metal castings, precision machined components and sub-assemblies in the electrical products, power transmission and distribution and general industrial markets   First lien senior secured revolving loan ($2.4 par due 10/2022)   7.55% (Libor + 4.75%/Q)     10/31/2017     2.4     2.4 (2)(15)(18)      
        First lien senior secured loan ($11.3 par due 10/2023)   7.55% (Libor + 4.75%/Q)     10/31/2017     11.3     11.3 (2)(15)      
        First lien senior secured loan ($12.4 par due 10/2023)   7.55% (Libor + 4.75%/Q)     10/31/2017     12.4     12.4 (2)(15)      
                        26.1     26.1        
                                       
TPTM Merger Corp.(19)   Time temperature indicator products   First lien senior secured loan ($13.3 par due 9/2020)   9.02% (Libor + 6.50%/Q)     12/11/2014     13.3     13.3 (3)(15)      
        First lien senior secured loan ($9.9 par due 9/2020)   9.02% (Libor + 6.50%/Q)     12/11/2014     9.9     9.9 (4)(15)      
                        23.2     23.2        
                        756.3     752.1     10.31 %
Other Services                                      
1A Smart Start, LLC(19)   Provider of ignition interlock devices   First lien senior secured revolving loan       2/8/2018         (17)      
                                       
AMCP Clean Intermediate, LLC(19)   Provider of janitorial and facilities management services   First lien senior secured revolving loan       10/1/2018         (17)      
        First lien senior secured loan ($7.6 par due 10/2024)   8.30% (Libor + 5.50%/Q)     10/1/2018     7.6     7.5 (2)(15)      
                        7.6     7.5        
                                       
American Residential Services L.L.C.   Heating, ventilation and air conditioning services provider   Second lien senior secured loan ($67.0 par due 12/2022)   10.52% (Libor + 8.00%/M)     6/30/2014     66.8     66.3 (2)(15)      
        Second lien senior secured loan ($3.8 par due 12/2022)   10.47% (Libor + 8.00%/M)     6/30/2014     3.7     3.7 (2)(15)      
                        70.5     70.0        
                                       
Capstone Logistics Acquisition, Inc.(19)   Outsourced supply chain solutions provider to operators of distribution centers   First lien senior secured revolving loan ($0.2 par due 4/2021)   9.00% (Base Rate + 3.50%/Q)     2/8/2018     0.2     0.2 (2)(15)(18)      
                                       
Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC(6)(19)   Provider of outsourced healthcare linen management solutions   First lien senior secured revolving loan       3/13/2014         (17)      
        First lien senior secured loan ($11.9 par due 12/2021)   9.27% (Libor + 6.75%/M)     4/6/2017     11.9     11.9 (2)(15)      
        First lien senior secured loan ($12.0 par due 12/2021)   9.27% (Libor + 6.75%/M)     6/12/2018     12.0     12.0 (2)(15)      
        First lien senior secured loan ($10.1 par due 12/2021)   9.27% (Libor + 6.75%/M)     3/13/2014     10.1     10.1 (3)(15)      
        Class A preferred units (3,393,973 units)         3/13/2014     4.0     2.9 (2)      
        Class B common units (377,108 units)         3/13/2014     0.4     2.2 (2)      
                        38.4     39.1        
                                       
IMIA Holdings, Inc.(19)   Marine preservation maintenance company   First lien senior secured revolving loan       10/26/2018         (17)      
        First lien senior secured loan ($2.8 par due 10/2024)   7.30% (Libor + 4.50%/Q)     10/26/2018     2.8     2.8 (2)(15)      
        First lien senior secured loan ($18.0 par due 10/2024)   7.30% (Libor + 4.50%/Q)     10/26/2018     17.9     17.9 (3)(15)      
                        20.7     20.7        

F-28


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Magento, Inc.(19)   eCommerce platform provider for the retail industry   First lien senior secured revolving loan       2/8/2018         (17)      
                                       
Massage Envy, LLC and ME Equity LLC(19)   Franchisor in the massage industry   First lien senior secured loan ($1.0 par due 12/2024)   9.40% (Libor + 6.75%/M)     1/24/2018     1.0     1.0 (2)(15)      
        First lien senior secured loan ($0.5 par due 12/2024)   9.49% (Libor + 6.75%/M)     1/24/2018     0.5     0.5 (2)(15)      
        First lien senior secured loan ($0.3 par due 12/2024)   9.52% (Libor + 6.75%/Q)     1/24/2018     0.3     0.3 (2)(15)      
        First lien senior secured loan ($1.7 par due 12/2024)   9.53% (Libor + 6.75%/Q)     1/24/2018     1.7     1.7 (2)(15)      
        First lien senior secured loan ($0.4 par due 12/2024)   9.46% (Libor + 6.75%/Q)     1/24/2018     0.4     0.4 (2)(15)      
        First lien senior secured loan ($0.7 par due 12/2024)   9.44% (Libor + 6.75%/Q)     1/24/2018     0.7     0.7 (2)(15)      
        First lien senior secured loan ($0.7 par due 12/2024)   9.55% (Libor + 6.75%/Q)     1/24/2018     0.7     0.7 (2)(15)      
        First lien senior secured loan ($0.4 par due 7/2020)   9.53% (Libor + 6.75%/Q)     7/20/2018     0.4     0.4 (2)(15)      
        First lien senior secured loan ($0.6 par due 9/2020)   9.49% (Libor + 6.75%/Q)     7/27/2017     0.6     0.6 (2)(15)      
        First lien senior secured loan ($0.5 par due 9/2020)   9.49% (Libor + 6.75%/Q)     7/27/2017     0.5     0.5 (2)(15)      
        First lien senior secured loan ($0.3 par due 9/2020)   9.44% (Libor + 6.75%/Q)     7/27/2017     0.3     0.3 (2)(15)      
        First lien senior secured loan ($0.3 par due 9/2020)   9.49% (Libor + 6.75%/Q)     4/12/2017     0.3     0.3 (2)(15)      
        First lien senior secured loan ($0.1 par due 9/2020)   9.55% (Libor + 6.75%/Q)     4/12/2017     0.1     0.1 (2)(15)      
        First lien senior secured loan ($1.0 par due 9/2020)   9.50% (Libor + 6.75%/Q)     4/12/2017     1.0     1.0 (2)(15)      
        First lien senior secured loan ($38.1 par due 9/2020)   9.46% (Libor + 6.75%/Q)     9/27/2012     38.1     38.1 (3)(15)      
        First lien senior secured loan ($18.5 par due 9/2020)   9.46% (Libor + 6.75%/Q)     9/27/2012     18.5     18.5 (4)(15)      
        Common stock (3,000,000 shares)         9/27/2012     3.0     6.2 (2)      
                        68.1     71.3        
                                       
Mckenzie Sports Products, LLC(19)   Designer, manufacturer and distributor of hunting-related supplies   First lien senior secured revolving loan ($2.2 par due 9/2020)   6.27% (Libor + 3.75%/M)     9/18/2014     2.2     2.2 (2)(15)      
        First lien senior secured revolving loan ($0.7 par due 9/2020)   8.25% (Base Rate + 2.75%/M)     9/18/2014     0.7     0.7 (2)(15)      
        First lien senior secured loan ($5.5 par due 9/2020)   8.27% (Libor + 5.75%/M)     9/18/2014     5.5     5.5 (3)(15)      
        First lien senior secured loan ($84.5 par due 9/2020)   9.61% (Libor + 7.09%/M)     9/18/2014     84.5     84.5 (3)(11)(15)      
                        92.9     92.9        
                                       
MSHC, Inc.(19)   Heating, ventilation and air conditioning services provider   First lien senior secured revolving loan ($1.6 par due 7/2022)   8.75% (Base Rate + 3.25%/Q)     7/31/2017     1.6     1.6 (2)(15)      
        First lien senior secured loan ($1.0 par due 7/2023)   6.89% (Libor + 4.25%/Q)     7/31/2017     1.0     1.0 (2)(15)      
        Second lien senior secured loan ($7.9 par due 7/2024)   10.78% (Libor + 8.25%/Q)     6/27/2018     7.9     7.9 (2)(15)      
        Second lien senior secured loan ($9.8 par due 7/2024)   10.96% (Libor + 8.25%/Q)     6/27/2018     9.8     9.8 (2)(15)      
        Second lien senior secured loan ($4.8 par due 7/2024)   11.05% (Libor + 8.25%/Q)     7/31/2017     4.8     4.8 (2)(15)      
        Second lien senior secured loan ($46.0 par due 7/2024)   11.05% (Libor + 8.25%/Q)     7/31/2017     46.0     46.0 (2)(15)      
                        71.1     71.1        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Osmose Utilities Services, Inc.(19)   Provider of structural integrity management services to transmission and distribution infrastructure   First lien senior secured revolving loan ($1.5 par due 8/2020)   10.50% (Base Rate + 5.00%/Q)     1/3/2017     1.5     1.5 (2)(15)(18)      
        Second lien senior secured loan ($51.4 par due 8/2023)   10.55% (Libor + 7.75%/Q)     9/3/2015     50.7     51.4 (2)(15)      
        Second lien senior secured loan ($34.0 par due 8/2023)   10.55% (Libor + 7.75%/Q)     1/3/2017     33.5     34.0 (2)(15)      
                        85.7     86.9        
                                       
SecurAmerica, LLC, ERMC LLC, ERMC Of America, LLC, SecurAmerica Corporation, ERMC Aviation LLC, American Security Programs, Inc., USI LLC and Argenbright Holdings IV, LLC(19)   Provider of outsourced manned security guard services, outsourced facilities management and outsourced aviation services   First lien senior secured loan ($26.1 par due 12/2023)   9.23% (Libor + 6.75%/M)     12/21/2018     26.1     25.8 (2)(15)      
                                       
Siteworx Holdings, LLC & Siteworx LLC(19)   Provider of design, web content management, eCommerce solutions and system integration   First lien senior secured revolving loan ($1.5 par due 1/2020)   6.75% (Base Rate + 1.25%/Q)     2/16/2018     1.5     1.5 (13)(15)      
        First lien senior secured loan ($2.4 par due 1/2020)   8.31% (Libor + 5.50%/Q)     2/16/2018     2.4     2.4 (13)(15)      
                        3.9     3.9        
                                       
SocialFlow, Inc.   Social media optimization platform provider   Warrant to purchase up to 215,331 shares of Series C preferred stock (expires 1/2026)         1/13/2016         (2)      
                                       
SoundCloud Limited(8)   Platform for receiving, sending, and distributing music   Common stock (73,422 shares)         8/15/2017     0.4     0.7 (2)      
                                       
Spin HoldCo Inc.   Laundry service and equipment provider   Second lien senior secured loan ($154.2 par due 5/2023)   10.19% (Libor + 7.50%/Q)     5/14/2013     154.2     152.6 (2)(15)      
                                       
TDG Group Holding Company and TDG Co-Invest, LP(19)   Operator of multiple franchise concepts primarily related to home maintenance or repairs   First lien senior secured revolving loan ($0.0 par due 5/2024)   8.02% (Libor + 5.50%/M)     5/31/2018         (2)(15)(18)      
        First lien senior secured loan ($3.2 par due 5/2024)   8.30% (Libor + 5.50%/Q)     5/31/2018     3.2     3.2 (2)(15)      
        First lien senior secured loan ($9.3 par due 5/2024)   8.30% (Libor + 5.50%/Q)     5/31/2018     9.3     9.2 (3)(15)      
        Preferred units (2,871,000 units)         5/31/2018     2.9     2.9 (2)      
        Common units (29,000 units)         5/31/2018         (2)      
                        15.4     15.3        
                                       
Tyden Group Holding Corp.(8)   Producer and marketer of global cargo security, product identification and traceability products and utility meter products   Preferred stock (46,276 shares)         1/3/2017     0.4     0.4        
        Common stock (5,521,203 shares)         1/3/2017     2.0     5.6        
                        2.4     6.0        

F-30


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
VLS Recovery Services, LLC(19)   Provider of commercial and industrial waste processing and disposal services   First lien senior secured revolving loan ($0.5 par due 10/2023)   8.46% (Libor + 6.00%/M)     10/17/2017     0.5     0.5 (2)(15)(18)      
        First lien senior secured revolving loan ($1.1 par due 10/2023)   8.47% (Libor + 6.00%/M)     10/17/2017     1.1     1.1 (2)(15)(18)      
        First lien senior secured revolving loan ($1.1 par due 10/2023)   8.38% (Libor + 6.00%/M)     10/17/2017     1.1     1.1 (2)(15)(18)      
        First lien senior secured revolving loan ($0.5 par due 10/2023)   8.40% (Libor + 6.00%/M)     10/17/2017     0.5     0.5 (2)(15)(18)      
        First lien senior secured loan ($5.1 par due 10/2023)   8.47% (Libor + 6.00%/M)     10/17/2017     5.1     5.1 (2)(15)      
        First lien senior secured loan ($6.8 par due 10/2023)   8.46% (Libor + 6.00%/M)     10/17/2017     6.8     6.8 (2)(15)      
                        15.1     15.1        
                                       
WASH Multifamily Acquisition Inc. and Coinamatic Canada Inc.   Laundry service and equipment provider   Second lien senior secured loan ($3.7 par due 5/2023)   9.52% (Libor + 7.00%/M)     5/14/2015     3.7     3.6 (2)(15)      
        Second lien senior secured loan ($21.3 par due 5/2023)   9.52% (Libor + 7.00%/M)     5/14/2015     21.0     20.6 (2)(15)      
                        24.7     24.2        
                        697.4     703.3     9.64 %
Power Generation                                      
Alphabet Energy, Inc.   Technology developer to convert waste-heat into electricity   First lien senior secured loan ($3.5 par due 8/2017)         12/16/2013     2.9     (2)(14)      
        Series 1B preferred stock (12,976 shares)         6/21/2016     0.2     (2)      
        Warrant to purchase up to 125,000 shares of Series 2 preferred stock (expires 12/2023)         6/30/2016     0.1     (2)      
                        3.2            
                                       
Apex Clean Energy Holdings, LLC(19)   Developer, builder and owner of utility-scale wind and solar power facilities   First lien senior secured revolving loan       12/12/2018         (17)      
        First lien senior secured loan ($95.4 par due 9/2022)   9.55% (Libor + 6.75%/Q)     9/24/2018     95.4     94.5 (2)(15)      
                        95.4     94.5        
                                       
CPV Maryland Holding Company II, LLC   Gas turbine power generation facilities operator   Senior subordinated loan ($51.4 par due 12/2020)   6.00% Cash, 5.00% PIK     8/8/2014     51.4     46.8 (2)      
                                       
DGH Borrower LLC(19)   Developer, owner and operator of quick start, small-scale natural gas-fired power generation projects   First lien senior secured loan ($47.2 par due 6/2023)   9.30% (Libor + 6.50%/Q)     6/8/2018     47.2     47.2 (2)(15)      
                                       
Green Energy Partners, Stonewall LLC and Panda Stonewall Intermediate Holdings II LLC   Gas turbine power generation facilities operator   First lien senior secured loan ($24.7 par due 11/2021)   8.30% (Libor + 5.50%/Q)     11/13/2014     24.6     24.2 (2)(15)      
        Senior subordinated loan ($21.2 par due 12/2021)   8.00% Cash, 5.25% PIK     11/13/2014     21.2     20.4 (2)      
        Senior subordinated loan ($99.0 par due 12/2021)   8.00% Cash, 5.25% PIK     11/13/2014     99.0     95.3 (2)      
                        144.8     139.9        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Joule Unlimited Technologies, Inc. and Stichting Joule Global Foundation   Renewable fuel and chemical production developer   First lien senior secured loan ($7.8 par due 10/2018)         3/31/2015     5.8     (2)(14)      
        Warrant to purchase up to 32,051 shares of Series C-2 preferred stock (expires 7/2023)         7/25/2013         (2)(8)      
                        5.8            
                                       
Moxie Patriot LLC   Gas turbine power generation facilities operator   First lien senior secured loan ($32.5 par due 12/2020)   8.55% (Libor + 5.75%/Q)     12/19/2013     32.4     31.9 (2)(15)      
                                       
Navisun LLC and Navisun Holdings LLC(7)(19)   Owner and operater of commercial and industrial solar projects   First lien senior secured loan ($25.0 par due 11/2023)   8.00% PIK     11/15/2017     25.0     25.0 (2)      
        Series A preferred units   10.50% PIK     11/15/2017     2.9     2.9 (2)      
        Class A units (550 units)         11/15/2017                
                        27.9     27.9        
                                       
Panda Liberty LLC (fka Moxie Liberty LLC)   Gas turbine power generation facilities operator   First lien senior secured loan ($49.6 par due 8/2020)   9.30% (Libor + 6.50%/Q)     4/6/2018     47.0     44.7 (2)(15)      
        First lien senior secured loan ($34.0 par due 8/2020)   9.30% (Libor + 6.50%/Q)     8/21/2013     33.9     30.6 (2)(15)      
                        80.9     75.3        
                                       
Panda Temple Power, LLC and T1 Power Holdings LLC(6)   Gas turbine power generation facilities operator   Second lien senior secured loan ($9.0 par due 2/2023)   10.46% (Libor + 8.00%/M)     3/6/2015     9.0     9.0 (2)(15)      
        Class A Common units (616,122 shares)         3/6/2015     15.0     13.0 (2)      
                        24.0     22.0        
                                       
PERC Holdings 1 LLC   Operator of recycled energy, combined heat and power, and energy efficiency facilities   Class B common units (21,653,543 units)         10/20/2014     21.7     34.7 (2)      
                                       
Riverview Power LLC   Operator of natural gas and oil fired power generation facilities   First lien senior secured loan ($81.2 par due 12/2022)   10.80% (Libor + 8.00%/Q)     12/29/2016     79.7     81.2 (2)(15)      
                        614.4     601.4     8.24 %
Restaurants and Food Services                                      
ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.(7)(19)   Restaurant owner and operator   First lien senior secured loan ($4.3 par due 12/2018)   20.32% PIK (Libor + 18.00%/Q)     12/22/2016     4.3     4.3 (2)(15)      
        First lien senior secured loan ($56.6 par due 12/2018)         11/27/2006     39.9     1.2 (2)(14)      
        Promissory note ($31.8 par due 12/2023)         11/27/2006     13.8     (2)      
        Warrant to purchase up to 0.95 units of Series D common stock (expires 12/2023)         12/18/2013         (2)      
                        58.0     5.5        
                                       
Cipriani USA, Inc.   Manager and operator of banquet facilities, restaurants, hotels and other leisure properties   First lien senior secured loan ($3.0 par due 5/2023)   10.34% (Libor + 8.00%/M)     8/20/2018     3.0     3.0 (2)(15)      
        First lien senior secured loan ($12.0 par due 5/2023)   10.35% (Libor + 8.00%/M)     11/5/2018     12.0     11.9 (2)(15)      
        First lien senior secured loan ($3.0 par due 5/2023)   10.38% (Libor + 8.00%/M)     11/5/2018     3.0     3.0 (2)(15)      
        First lien senior secured loan ($67.8 par due 5/2023)   10.34% (Libor + 8.00%/M)     5/30/2018     67.8     67.1 (2)(15)      
                        85.8     85.0        

F-32


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Cozzini Bros., Inc. and BH-Sharp Holdings LP(19)   Provider of commercial knife sharpening and cutlery services in the restaurant industry   First lien senior secured revolving loan ($1.5 par due 3/2023)   8.02% (Libor + 5.50%/M)     3/10/2017     1.5     1.5 (2)(15)      
        First lien senior secured loan ($6.6 par due 3/2023)   8.02% (Libor + 5.50%/M)     3/10/2017     6.6     6.6 (2)(15)      
        First lien senior secured loan ($11.6 par due 3/2023)   8.02% (Libor + 5.50%/M)     3/10/2017     11.6     11.6 (4)(15)      
        Common units (2,950,000 units)         3/10/2017     3.0     3.4 (2)      
                        22.7     23.1        
                                       
FWR Holding Corporation(19)   Restaurant owner, operator, and franchisor   First lien senior secured revolving loan ($0.8 par due 8/2023)   10.25% (Base Rate + 4.75%/Q)     8/21/2017     0.8     0.8 (2)(15)(18)      
        First lien senior secured loan ($0.5 par due 8/2023)   8.26% (Libor + 5.75%/M)     8/21/2017     0.5     0.5 (2)(15)      
        First lien senior secured loan ($0.8 par due 8/2023)   8.26% (Libor + 5.75%/M)     8/21/2017     0.8     0.8 (2)(15)      
        First lien senior secured loan ($4.0 par due 8/2023)   8.26% (Libor + 5.75%/M)     8/21/2017     4.0     4.0 (2)(15)      
                        6.1     6.1        
                                       
Garden Fresh Restaurant Corp. and GFRC Holdings LLC(19)   Restaurant owner and operator   First lien senior secured revolving loan       2/1/2017         (17)      
        First lien senior secured loan ($23.9 par due 2/2022)   10.39% (Libor + 8.00%/S)     10/3/2013     23.9     23.9 (2)(15)      
                        23.9     23.9        
                                       
Heritage Food Service Group, Inc. and WCI-HFG Holdings, LLC   Distributor of repair and replacement parts for commercial kitchen equipment   Second lien senior secured loan ($31.6 par due 10/2022)   11.00% (Libor + 8.50%/S)     10/20/2015     31.6     31.6 (2)(15)      
        Preferred units (3,000,000 units)         10/20/2015     3.0     4.5 (2)      
                        34.6     36.1        
                                       
Jim N Nicks Management, LLC(19)   Restaurant owner and operator   First lien senior secured revolving loan ($2.8 par due 7/2023)   8.05% (Libor + 5.25%/Q)     7/10/2017     2.8     2.7 (2)(15)      
        First lien senior secured loan ($1.2 par due 7/2023)   8.05% (Libor + 5.25%/Q)     7/10/2017     1.2     1.1 (2)(15)      
        First lien senior secured loan ($14.0 par due 7/2023)   8.05% (Libor + 5.25%/Q)     7/10/2017     14.0     13.5 (4)(15)      
                        18.0     17.3        
                                       
Orion Foods, LLC(7)   Convenience food service retailer   First lien senior secured loan ($1.2 par due 9/2015)         4/1/2010     1.2     0.5 (2)(14)      
        Second lien senior secured loan ($19.4 par due 9/2015)         4/1/2010         (2)(14)      
        Preferred units (10,000 units)         10/28/2010         (2)      
        Class A common units (25,001 units)         4/1/2010         (2)      
        Class B common units (1,122,452 units)         4/1/2010         (2)      
                        1.2     0.5        

F-33


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
OTG Management, LLC(19)   Airport restaurant operator   First lien senior secured revolving loan ($1.6 par due 8/2021)   9.65% (Libor + 7.00%/Q)     8/26/2016     1.6     1.6 (2)(15)      
        First lien senior secured revolving loan ($8.4 par due 8/2021)   9.41% (Libor + 7.00%/Q)     8/26/2016     8.4     8.4 (2)(15)      
        First lien senior secured loan ($4.7 par due 8/2021)   9.61% (Libor + 7.00%/Q)     8/26/2016     4.7     4.7 (2)(15)      
        First lien senior secured loan ($2.2 par due 8/2021)   9.60% (Libor + 7.00%/Q)     8/26/2016     2.2     2.2 (2)(15)      
        First lien senior secured loan ($2.2 par due 8/2021)   9.71% (Libor + 7.00%/Q)     8/26/2016     2.2     2.2 (2)(15)      
        First lien senior secured loan ($6.1 par due 8/2021)   9.51% (Libor + 7.00%/Q)     8/26/2016     6.1     6.1 (2)(15)      
        First lien senior secured loan ($4.9 par due 8/2021)   9.54% (Libor + 7.00%/Q)     8/26/2016     4.9     4.9 (2)(15)      
        First lien senior secured loan ($0.7 par due 8/2021)   9.41% (Libor + 7.00%/Q)     8/26/2016     0.7     0.7 (2)(15)      
        First lien senior secured loan ($1.8 par due 8/2021)   9.78% (Libor + 7.00%/Q)     8/26/2016     1.8     1.8 (2)(15)      
        First lien senior secured loan ($1.0 par due 8/2021)   9.43% (Libor + 7.00%/Q)     8/26/2016     1.0     1.0 (2)(15)      
        First lien senior secured loan ($1.9 par due 8/2021)   9.41% (Libor + 7.00%/Q)     10/10/2018     1.9     1.9 (2)(15)      
        First lien senior secured loan ($0.7 par due 8/2021)   9.61% (Libor + 7.00%/Q)     10/10/2018     0.7     0.7 (2)(15)      
        First lien senior secured loan ($0.7 par due 8/2021)   9.78% (Libor + 7.00%/Q)     10/10/2018     0.7     0.7 (2)(15)      
        First lien senior secured loan ($48.9 par due 8/2021)   9.40% (Libor + 7.00%/Q)     8/26/2016     48.9     48.9 (3)(15)      
        First lien senior secured loan ($48.9 par due 8/2021)   9.54% (Libor + 7.00%/Q)     8/26/2016     48.9     48.9 (3)(15)      
        Senior subordinated loan ($30.1 par due 2/2022)   13.00% PIK     8/26/2016     30.0     30.1 (2)      
        Class A preferred units (3,000,000 units)         8/26/2016     30.0     39.5 (2)      
        Common units (3,000,000 units)         1/5/2011     3.0     9.2 (2)      
        Warrant to purchase up to 7.73% of common units         6/19/2008     0.1     20.3 (2)      
                        197.8     233.8        
                                       
SFE Intermediate Holdco LLC(19)   Provider of outsourced foodservice to K-12 school districts   First lien senior secured loan ($10.8 par due 7/2024)   7.50% (Libor + 4.75%/Q)     9/5/2018     10.8     10.8 (2)(15)      
        First lien senior secured loan ($6.7 par due 7/2024)   7.28% (Libor + 4.75%/Q)     7/31/2017     6.7     6.7 (4)(15)      
                        17.5     17.5        
                                       
Spectra Finance, LLC(19)   Venue management and food and beverage provider   First lien senior secured revolving loan ($5.4 par due 4/2023)   6.39% (Libor + 4.00%/M)     4/2/2018     5.4     5.4 (2)(15)(18)      
        First lien senior secured loan ($19.0 par due 4/2024)   7.05% (Libor + 4.25%/Q)     4/2/2018     19.0     19.0 (2)(15)      
                        24.4     24.4        
                        490.0     473.2     6.49 %
Oil and Gas                                      
Murchison Oil and Gas, LLC and Murchison Holdings, LLC(19)   Exploration and production company   First lien senior secured loan ($5.0 par due 10/2023)   10.80% (Libor + 8.00%/Q)     10/26/2018     5.0     5.0 (2)(15)      
        First lien senior secured loan ($21.7 par due 10/2023)   10.80% (Libor + 8.00%/Q)     10/26/2018     21.1     21.5 (2)(15)      
        Preferred units (21,667 units)         10/26/2018     21.7     21.7        
                        47.8     48.2        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Penn Virginia Holding Corp.   Exploration and production company   Second lien senior secured loan ($90.1 par due 9/2022)   9.53% (Libor + 7.00%/M)     9/28/2017     90.1     90.1 (2)(15)      
                                       
Petroflow Energy Corporation and TexOak Petro Holdings LLC(6)   Oil and gas exploration and production company   First lien senior secured loan ($10.3 par due 6/2019)         6/29/2016     8.5     8.3 (2)(14)      
        Second lien senior secured loan ($26.6 par due 12/2019)         6/29/2016     21.9     (2)(14)      
        Common units (202,000 units)         6/29/2016     11.1            
                        41.5     8.3        
                                       
Sundance Energy, Inc.   Oil and gas producer   Second lien senior secured loan ($60.7 par due 4/2023)   10.81% (Libor + 8.00%/Q)     4/23/2018     59.7     60.7 (2)(15)      
                                       
Utility Pipeline, Ltd.(19)   Natural gas distribution management company   First lien senior secured revolving loan ($0.1 par due 4/2022)   6.69% (Libor + 4.00%/Q)     2/8/2018     0.1     0.1 (2)(15)      
                                       
VPROP Operating, LLC and Vista Proppants and Logistics, LLC   Sand-based proppant producer and distributor to the oil and natural gas industry   First lien senior secured loan ($28.5 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     8/1/2017     28.4     28.5 (2)(15)      
        First lien senior secured loan ($35.6 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     11/9/2017     35.6     35.6 (2)(15)      
        First lien senior secured loan ($15.3 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     3/1/2017     15.3     15.3 (2)(15)      
        First lien senior secured loan ($76.3 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     3/1/2017     76.3     76.3 (3)(15)      
        Common units (997,864 units)         11/9/2017     9.7     9.6 (2)      
                        165.3     165.3        
                        404.5     372.7     5.11 %
Food and Beverage                                      
American Seafoods Group LLC and American Seafoods Partners LLC   Harvester and processor of seafood   Class A units (77,922 units)         8/19/2015     0.1     0.2 (2)      
        Warrant to purchase up to 7,422,078 Class A units (expires 8/2035)         8/19/2015     7.4     15.6 (2)      
                        7.5     15.8        
                                       
CHG PPC Parent LLC   Diversified food products manufacturer   Second lien senior secured loan ($60.5 par due 3/2026)   10.02% (Libor + 7.50%/M)     3/30/2018     60.5     59.9 (2)(15)      
                                       
Edward Don & Company, LLC and VCP-EDC Co-Invest, LLC   Distributor of foodservice equipment and supplies   Membership units (2,970,000 units)         6/9/2017     3.0     4.2        
                                       
Ferraro Fine Foods Corp. and Italian Fine Foods Holdings L.P.(19)   Specialty Italian food distributor   First lien senior secured revolving loan ($1.3 par due 5/2023)   6.85% (Libor + 4.25%/Q)     5/9/2018     1.3     1.3 (2)(15)      
        First lien senior secured loan ($0.7 par due 5/2024)   7.02% (Libor + 4.25%/Q)     12/7/2018     0.7     0.7 (2)(15)      
        First lien senior secured loan ($9.4 par due 5/2024)   6.85% (Libor + 4.25%/Q)     5/9/2018     9.4     9.4 (2)(15)      
        Class A common units (2,724,000 units)         5/9/2018     2.7     3.1 (2)      
                        14.1     14.5        
                                       
Gehl Foods, LLC and GF Parent LLC   Producer of low-acid, aseptic food and beverage products   Class A preferred units         5/13/2015     2.9     (2)      
        Class A common units (60,000 units)         5/13/2015     0.1     (2)      
        Class B common units (0.26 units)         5/13/2015         (2)      
                        3.0            
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
H-Food Holdings, LLC and Matterhorn Parent, LLC   Food contract manufacturer   First lien senior secured loan ($30.9 par due 5/2025)   6.52% (Libor + 4.00%/M)     11/25/2018     30.6     30.0 (2)(15)      
        Second lien senior secured loan ($73.0 par due 3/2026)   9.51% (Libor + 7.00%/M)     11/25/2018     73.0     71.6 (2)(15)      
        Common units (5,827 units)         11/25/2018     5.8     5.8        
                        109.4     107.4        
                                       
Hometown Food Company(19)   Food distributor   First lien senior secured loan ($9.3 par due 8/2023)   7.78% (Libor + 5.25%/M)     8/31/2018     9.1     9.2 (2)(15)      
                                       
JWC/KI Holdings, LLC   Foodservice sales and marketing agency   Membership units (5,000 units)         11/16/2015     5.0     5.3 (2)      
                                       
KC Culinarte Intermediate, LLC   Manufacturer of fresh refrigerated and frozen food products   Second lien senior secured loan ($35.7 par due 8/2026)   10.26% (Libor + 7.75%/M)     8/24/2018     35.7     35.1 (2)(15)      
                                       
NECCO Holdings, Inc. and New England Confectionery Company, Inc.(7)(19)   Producer and supplier of candy   First lien senior secured revolving loan ($19.9 par due 1/2018)       1/3/2017     7.9     2.9 (14)      
        First lien senior secured loan ($2.2 par due 8/2018)         11/20/2017     2.1     (14)      
        First lien senior secured loan ($11.6 par due 1/2018)         1/3/2017     0.9     1.6 (14)      
        First lien senior secured loan ($0.7 par due 11/2018)         11/20/2017     0.7     0.1 (14)      
        Common stock (860,189 shares)         1/3/2017                
                        11.6     4.6        
                                       
PCM Bmark, Inc. and BakeMark Holdings, Inc.   Manufacturer and distributor of specialty bakery ingredients   First lien senior secured loan ($0.6 par due 8/2023)   7.77% (Libor + 5.25%/M)     5/9/2018     0.6     0.6 (2)(15)      
                                       
RF HP SCF Investor, LLC(9)   Branded specialty food company   Membership interest (10.08% interest)         12/22/2016     12.5     16.2 (2)      
                                       
Sovos Brands Intermediate, Inc.(19)   Food and beverage platform   First lien senior secured loan ($16.9 par due 11/2025)   7.64% (Libor + 5.00%/S)     11/20/2018     16.7     16.7 (2)(15)      
                                       
Teasdale Foods, Inc.(19)   Provider of beans, sauces and hominy to the retail, foodservice and wholesale channels   First lien senior secured revolving loan ($0.6 par due 10/2020)   7.72% (Libor + 5.25%/M)     6/30/2017     0.6     0.5 (2)(15)      
        First lien senior secured revolving loan ($0.1 par due 10/2020)   9.75% (Base Rate + 4.25%/M)     6/30/2017     0.1     0.1 (2)(15)      
        First lien senior secured loan ($0.6 par due 10/2020)   7.65% (Libor + 5.25%/Q)     6/26/2018     0.6     0.6 (2)(15)      
        Second lien senior secured loan ($33.6 par due 10/2021)   11.28% (Libor + 8.75%/Q)     1/3/2017     33.6     28.9 (2)(15)      
        Second lien senior secured loan ($31.5 par due 10/2021)   11.28% (Libor + 8.75%/Q)     1/3/2017     31.5     27.1 (2)(15)      
        Second lien senior secured loan ($21.3 par due 10/2021)   11.24% (Libor + 8.75%/Q)     1/3/2017     21.3     18.3 (2)(15)      
                        87.7     75.5        
                        376.4     365.0     5.00 %
Automotive Services                                      
A.U.L. Corp.(19)   Provider of vehicle service contracts and limited warranties for passenger vehicles   First lien senior secured loan ($7.0 par due 6/2023)   7.06% (Libor + 4.50%/M)     6/7/2017     7.0     7.0 (2)(15)      
                                       
AEP Holdings, Inc. and Arrowhead Holdco Company   Distributor of non-discretionary, mission-critical aftermarket replacement parts   First lien senior secured loan ($0.1 par due 8/2021)   8.35% (Libor + 6.00%/S)     6/28/2018     0.1     0.1 (2)(15)      
        First lien senior secured loan ($27.4 par due 8/2021)   8.51% (Libor + 6.00%/S)     6/28/2018     27.3     26.8 (2)(15)      
        Common stock (3,467 shares)         8/31/2015     3.5     2.7 (2)      
                        30.9     29.6        
                                     

F-36


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
ChargePoint, Inc.   Developer and operator of electric vehicle charging stations   Warrant to purchase up to 809,126 shares of Series E preferred stock (expires 12/2024)         12/30/2014     0.3     2.8 (2)      
                                       
Dent Wizard International Corporation and DWH Equity Investors, L.P.   Automotive reconditioning services   Second lien senior secured loan ($50.0 par due 10/2020)   10.51% (Libor + 8.00%/M)     4/7/2015     50.0     50.0 (2)(15)      
        Class A common stock (10,000 shares)         4/7/2015     0.2     0.6 (2)      
        Class B common stock (20,000 shares)         4/7/2015     0.4     1.3 (2)      
                        50.6     51.9        
                                       
Eckler Industries, Inc. and Eckler Purchaser LLC(7)(19)   Restoration parts and accessories provider for classic automobiles   First lien senior secured revolving loan ($1.3 par due 5/2022)   12.00%     7/12/2012     1.3     1.3 (2)      
        First lien senior secured loan ($18.3 par due 5/2022)   12.00%     7/12/2012     18.1     18.3 (2)      
        Class A preferred units (67,972 units)         7/12/2012     15.9     3.2 (2)      
        Class A common units (67,972 units)         7/12/2012     0.5     (2)      
                        35.8     22.8        
                                       
ESCP PPG Holdings, LLC(6)   Distributor of new equipment and aftermarket parts to the heavy-duty truck industry   Class A units (3,500,000 units)         12/14/2016     3.5     2.4 (2)      
                                       
GB Auto Service Holdings, LLC(19)   Automotive parts and repair services retailer   First lien senior secured loan ($22.4 par due 10/2024)   8.47% (Libor + 6.00%/M)     10/19/2018     22.4     22.2 (3)(15)      
        Common units (3,700,000 units)         10/19/2018     4.6     4.6 (2)      
                        27.0     26.8        
                                       
Mavis Tire Express Services Corp. and Mavis Tire Express Services TopCo, L.P.(19)   Auto parts retailer   Second lien senior secured loan ($1.4 par due 3/2026)   9.97% (Libor + 7.50%/M)     3/20/2018     1.4     1.4 (2)(15)      
        Second lien senior secured loan ($153.9 par due 3/2026)   9.97% (Libor + 7.50%/M)     3/20/2018     151.7     152.4 (2)(15)      
        Class A units (12,400,000 units)         3/20/2018     12.4     13.0 (2)      
                        165.5     166.8        
                                       
Simpson Performance Products, Inc.   Provider of motorsports safety equipment   First lien senior secured loan ($28.3 par due 2/2020)   10.28% (Libor + 7.48%/Q)     2/20/2015     28.3     28.3 (3)(15)      
                                       
SK SPV IV, LLC   Collision repair site operator   Series A common stock (12,500 units)         8/18/2014     0.6     2.5 (2)      
        Series B common stock (12,500 units)         8/18/2014     0.6     2.5 (2)      
                        1.2     5.0        
                        350.1     343.4     4.71 %
Wholesale Distribution                                      
DFS Holding Company, Inc.   Distributor of maintenance, repair, and operations parts, supplies, and equipment to the foodservice industry   First lien senior secured loan ($4.6 par due 2/2022)   8.27% (Libor + 5.75%/M)     3/1/2017     4.6     4.5 (2)(15)      
        First lien senior secured loan ($85.8 par due 2/2022)   8.27% (Libor + 5.75%/M)     7/26/2017     85.8     83.2 (2)(15)      
        First lien senior secured loan ($93.5 par due 2/2022)   8.27% (Libor + 5.75%/M)     7/26/2017     93.5     90.7 (3)(15)      
                        183.9     178.4        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Flow Control Solutions, Inc.(19)   Distributor and manufacturer of flow control systems components   First lien senior secured revolving loan ($0.4 par due 11/2024)   8.05% (Libor + 5.25%/Q)     11/21/2018     0.4     0.4 (2)(15)      
        First lien senior secured loan ($13.7 par due 11/2024)   8.05% (Libor + 5.25%/Q)     11/21/2018     13.7     13.6 (3)(15)      
                        14.1     14.0        
                                       
KHC Holdings, Inc. and Kele Holdco, Inc.(19)   Catalog-based distribution services provider for building automation systems   First lien senior secured revolving loan ($0.7 par due 10/2020)   6.76% (Libor + 4.25%/M)     1/3/2017     0.7     0.7 (2)(15)      
        First lien senior secured loan ($66.0 par due 10/2022)   8.80% (Libor + 6.00%/Q)     1/3/2017     66.0     66.0 (3)(15)      
        Common stock (30,000 shares)         1/3/2017     3.1     3.3        
                        69.8     70.0        
                                       
PetIQ, LLC   Distributor and manufacturer of pet prescription medications and health products   First lien senior secured revolving loan ($17.9 par due 1/2023)   7.60% (Libor + 5.25%/M)     1/17/2018     17.9     17.9 (2)(15)      
                        285.7     280.3     3.84 %
Education                                      
Excelligence Holdings Corp.   Developer, manufacturer and retailer of educational products   First lien senior secured loan ($9.3 par due 4/2023)   8.52% (Libor + 6.00%/M)     4/17/2017     9.3     8.0 (4)(15)      
                                       
Flinn Scientific, Inc. and WCI-Quantum Holdings, Inc.(19)   Distributor of instructional products, services and resources   First lien senior secured loan ($20.9 par due 8/2023)   7.55% (Libor + 4.75%/Q)     7/26/2017     20.9     20.9 (2)(15)      
        First lien senior secured loan ($25.4 par due 8/2023)   7.53% (Libor + 4.75%/Q)     7/26/2017     25.4     25.4 (2)(15)      
        First lien senior secured loan ($0.1 par due 8/2023)   9.25% (Base Rate + 3.75%/Q)     7/26/2017     0.1     0.1 (2)(15)      
        First lien senior secured loan ($11.2 par due 8/2023)   7.58% (Libor + 4.75%/Q)     8/31/2018     11.2     11.2 (2)(15)      
        Series A preferred stock (1,272 shares)         10/24/2014     0.7     1.0 (2)      
                        58.3     58.6        
                                       
Frontline Technologies Group Holding LLC, Frontline Technologies Blocker Buyer, Inc., Frontline Technologies Holdings, LLC and Frontline Technologies Parent, LLC(19)   Provider of human capital management ("HCM") and SaaS-based software solutions to employees and administrators of K-12 school organizations   First lien senior secured loan ($19.4 par due 9/2023)   9.02% (Libor + 6.50%/M)     9/19/2017     19.1     19.4 (2)(15)      
        Class A preferred units (4,574 units)         9/18/2017     4.6     5.6        
        Class B common units         9/18/2017         0.8        
                        23.7     25.8        
                                       
Infilaw Holding, LLC(19)   Operator of for-profit law schools   First lien senior secured revolving loan ($5.0 par due 9/2022)         8/25/2011     4.2     (2)(14)(18)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Instituto de Banca y Comercio, Inc. & Leeds IV Advisors, Inc.   Private school operator   First lien senior secured loan ($12.3 par due 10/2020)         10/31/2015     12.3     12.3 (2)      
        Senior preferred series A-1 shares (163,902 shares)         10/31/2015     119.4     18.2 (2)      
        Series B preferred stock (1,401,385 shares)         8/5/2010     4.0     (2)      
        Series B preferred stock (348,615 shares)         8/5/2010     1.0     (2)      
        Series C preferred stock (1,994,644 shares)         6/7/2010     0.5     (2)      
        Series C preferred stock (517,942 shares)         6/7/2010     0.1     (2)      
        Common stock (16 shares)         6/7/2010         (2)      
        Common stock (4 shares)         6/7/2010         (2)      
                        137.3     30.5        
                                       
Liaison Acquisition, LLC(19)   Provider of centralized applications services to educational associations   Second lien senior secured loan ($5.3 par due 8/2023)   11.72% (Libor + 9.25%/M)     2/9/2017     5.2     5.3 (2)(15)      
                                       
PIH Corporation and Primrose Holding Corporation(6)(19)   Franchisor of education-based early childhood centers   First lien senior secured revolving loan ($1.0 par due 12/2020)   7.88% (Libor + 5.50%/M)     12/13/2013     1.0     1.0 (2)(15)      
        First lien senior secured loan ($1.6 par due 12/2020)   7.85% (Libor + 5.50%/M)     12/15/2017     1.6     1.6 (2)(15)      
        Common stock (7,227 shares)         1/3/2017     10.7     23.0        
                        13.3     25.6        
                                       
R3 Education Inc., Equinox EIC Partners LLC and Sierra Education Finance Corp.   Medical school operator   Common membership interest (15.76% interest)         9/21/2007     15.8     15.8 (2)      
        Warrant to purchase up to 27,890 shares (expires 11/2019)         12/8/2009         7.5 (2)      
                        15.8     23.3        
                                       
Raptor Technologies, LLC and Rocket Parent, LLC(19)   Provider of SaaS-based safety and security software to the K-12 school market   First lien senior secured loan ($16.1 par due 12/2024)   8.46% (Libor + 6.00%/M)     12/17/2018     16.1     15.9 (2)(15)      
        Class A common units (2,294,000 units)         12/17/2018     2.3     2.3        
                        18.4     18.2        
                                       
Regent Education, Inc.   Provider of software solutions designed to optimize the financial aid and enrollment processes   Warrant to purchase up to 987 shares of common stock (expires 12/2026)         12/23/2016         (2)      
        Warrant to purchase up to 5,393,194 shares of common stock (expires 12/2026)         12/23/2016         (2)      
                                   
                                       
RuffaloCODY, LLC(19)   Provider of student fundraising and enrollment management services   First lien senior secured revolving loan       5/29/2013         (2)(17)      
                                       
Severin Acquisition, LLC(19)   Provider of student information system software solutions to the K-12 education market   Second lien senior secured loan ($80.0 par due 8/2026)   9.13% (Libor + 6.75%/M)     6/12/2018     79.2     77.6 (2)(15)      
                        364.7     272.9     3.74 %

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Containers and Packaging                                      
GS Pretium Holdings, Inc.   Manufacturer and supplier of high performance plastic containers   Common stock (500,000 shares)         6/2/2014     0.5     1.0 (2)      
                                       
LBP Intermediate Holdings LLC(19)   Manufacturer of paper and corrugated foodservice packaging   First lien senior secured revolving loan       7/10/2015         (17)      
        First lien senior secured loan ($11.5 par due 7/2020)   8.12% (Libor + 5.50%/Q)     11/13/2018     11.4     11.3 (2)(15)      
        First lien senior secured loan ($11.8 par due 7/2020)   8.30% (Libor + 5.50%/Q)     7/10/2015     11.7     11.7 (3)(15)      
        First lien senior secured loan ($5.0 par due 7/2020)   8.30% (Libor + 5.50%/Q)     7/10/2015     5.0     4.9 (4)(15)      
                        28.1     27.9        
                                       
Microstar Logistics LLC, Microstar Global Asset Management LLC, and MStar Holding Corporation   Keg management solutions provider   Second lien senior secured loan ($57.5 par due 8/2021)   10.02% (Libor + 7.50%/M)     12/14/2012     57.5     57.5 (2)(15)      
        Second lien senior secured loan ($75.0 par due 8/2021)   10.02% (Libor + 7.50%/M)     12/14/2012     75.0     75.0 (3)(15)      
        Second lien senior secured loan ($10.0 par due 8/2021)   10.02% (Libor + 7.50%/M)     12/14/2012     10.0     10.0 (4)(15)      
        Common stock (54,710 shares)         12/14/2012     4.9     8.2 (2)      
                        147.4     150.7        
                                       
NSI Holdings, Inc.(6)   Manufacturer of plastic containers for the wholesale nursery industry   Series A preferred stock (2,192 shares)         1/3/2017                
                                       
Ranpak Corp.   Manufacturer and marketer of paper-based protective packaging systems and materials   Second lien senior secured loan ($8.0 par due 10/2022)   9.71% (Libor + 7.25%/M)     1/3/2017     7.8     8.0 (2)(15)      
                                       
SCI PH Parent, Inc.   Industrial container manufacturer, reconditioner and servicer   Series B shares (11.4764 shares)         8/24/2018     1.1     1.8 (2)      
                        184.9     189.4     2.60 %
Environmental Services                                      
MPH Energy Holdings, LP   Operator of municipal recycling facilities   Limited partnership interest (3.13% interest)         1/8/2014         (2)      
                                       
RE Community Holdings GP, LLC and RE Community Holdings, LP   Operator of municipal recycling facilities   Limited partnership interest (2.86% interest)         3/1/2011         (2)      
        Limited partnership interest (2.49% interest)         3/1/2011         (2)      
                                   
                                       
Soil Safe, Inc. and Soil Safe Acquisition Corp.(7)(19)   Provider of soil treatment, recycling and placement services   First lien senior secured revolving loan       1/3/2017         (17)      
        First lien senior secured loan ($18.0 par due 1/2020)   8.77% (Libor + 6.25%/M)     1/3/2017     18.0     18.0 (2)(15)      
        Second lien senior secured loan ($12.7 par due 6/2020)   10.75% (Libor + 7.75%/M)     1/3/2017     12.7     12.7 (2)(15)      
        Senior subordinated loan ($43.4 par due 12/2020)   16.50% PIK     1/3/2017     43.4     43.4 (2)      
        Senior subordinated loan ($36.5 par due 12/2020)   14.50% PIK     1/3/2017     36.5     36.5 (2)      
        Senior subordinated loan ($36.4 par due 12/2020)         1/3/2017     11.5     10.2 (2)(14)      
        Common stock (810 shares)         1/3/2017                
                        122.1     120.8        
                        122.1     120.8     1.66 %

F-40


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Aerospace and Defense                                      
Cadence Aerospace, LLC(19)   Aerospace precision components manufacturer   First lien senior secured revolving loan       11/14/2017         (17)      
        First lien senior secured loan ($32.2 par due 11/2023)   9.11% (Libor + 6.50%/Q)     11/14/2017     31.9     32.2 (3)(15)      
        First lien senior secured loan ($10.0 par due 11/2023)   8.91% (Libor + 6.50%/Q)     7/5/2018     10.0     10.0 (2)(15)      
                        41.9     42.2        

MB Aerospace Holdings II Corp.

 

Aerospace engine components manufacturer

 

Second lien senior secured loan ($68.4 par due 1/2026)

 

11.30% (Libor + 8.50%/Q)

 

 

1/22/2018

 

 

68.4

 

 

68.4

(2)(15)

 

 

 
                        110.3     110.6     1.52 %
Chemicals                                      
AMZ Holding Corp.(19)   Specialty chemicals manufacturer   First lien senior secured loan ($12.0 par due 6/2022)   7.52% (Libor + 5.00%/M)     6/27/2017     12.0     12.0 (4)(15)      
                                       
Genomatica, Inc.   Developer of a biotechnology platform for the production of chemical products   Warrant to purchase 322,422 shares of Series D preferred stock (expires 3/2023)         3/28/2013         (2)      
                                       
Plaskolite PPC Intermediate II LLC and Plaskolite PPC Blocker LLC   Manufacturer of specialized acrylic and polycarbonate sheets   First lien senior secured loan ($25.0 par due 12/2025)   6.69% (Libor + 4.25%/Q)     12/14/2018     24.5     24.5 (2)(15)      
        Second lien senior secured loan ($55.7 par due 12/2026)   10.19% (Libor + 7.75%/M)     12/14/2018     55.7     54.6 (2)(15)      
        Co-Invest units (5,969 units)         12/14/2018     0.6     0.6        
                        80.8     79.7        
                        92.8     91.7     1.26 %
Printing, Publishing and Media                                      
Connoisseur Media, LLC   Owner and operator of radio stations   First lien senior secured loan ($13.5 par due 6/2019)   8.80% (Libor + 6.38%/Q)     7/26/2017     13.5     13.5 (2)(15)      
        First lien senior secured loan ($23.6 par due 6/2019)   8.90% (Libor + 6.38%/Q)     7/26/2017     23.6     23.6 (2)(15)      
        First lien senior secured loan ($10.1 par due 6/2019)   8.90% (Libor + 6.38%/Q)     7/26/2017     10.1     10.1 (4)(15)      
                        47.2     47.2        
                                       
Roark-Money Mailer LLC   Marketer, advertiser and distributor of coupons in the mail industry   Membership units (35,000 units)         1/3/2017                
                                       
The Teaching Company Holdings, Inc.   Education publications provider   Preferred stock (10,663 shares)         9/29/2006     1.1     (2)      
        Common stock (15,393 shares)         9/29/2006         (2)      
                        1.1            
                        48.3     47.2     0.65 %
Computers and Electronics                                      
Everspin Technologies, Inc.   Designer and manufacturer of computer memory solutions   Warrant to purchase up to 18,461 shares of common stock (expires 10/2026)         10/7/2016     0.4     (2)(22)      
                                       
Imaging Business Machines, L.L.C. and Scanner Holdings Corporation(7)   Provider of high-speed intelligent document scanning hardware and software   Senior subordinated loan ($8.3 par due 6/2022)   14.00%     1/3/2017     8.1     8.3 (2)      
        Senior subordinated loan ($8.3 par due 6/2022)   14.00%     1/3/2017     8.1     8.3 (2)      
        Series A preferred stock (66,424,135 shares)         1/3/2017         8.0        
        Class A common stock (33,173 shares)         1/3/2017                
        Class B common stock (134,214 shares)         1/3/2017                
                        16.2     24.6        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Zemax Software Holdings, LLC(19)   Provider of optical illumination design software to design engineers   First lien senior secured loan ($17.0 par due 6/2024)   8.55% (Libor + 5.75%/Q)     6/25/2018     17.0     16.9 (3)(15)      
                        33.6     41.5     0.57 %
Farming and Agriculture                                      
QC Supply, LLC(19)   Specialty distributor and solutions provider to the swine and poultry markets   First lien senior secured revolving loan ($9.0 par due 12/2021)   8.52% (Libor + 6.00%/M)     12/29/2016     9.0     8.5 (2)(15)      
        First lien senior secured loan ($8.7 par due 12/2022)   8.52% (Libor + 6.00%/M)     12/29/2016     8.7     8.2 (2)(15)      
        First lien senior secured loan ($11.1 par due 12/2022)   8.52% (Libor + 6.00%/M)     12/29/2016     11.1     10.5 (2)(15)      
        First lien senior secured loan ($14.7 par due 12/2022)   8.52% (Libor + 6.00%/M)     12/29/2016     14.7     13.9 (4)(15)      
                        43.5     41.1        
                        43.5     41.1     0.56 %
                                       
Retail                                      
Paper Source, Inc. and Pine Holdings, Inc.(19)   Retailer of fine and artisanal paper products   First lien senior secured revolving loan ($1.9 par due 9/2019)   10.50% (Base Rate + 5.00%/Q)     9/23/2013     1.9     1.9 (2)(15)      
        First lien senior secured loan ($9.3 par due 9/2019)   9.05% (Libor + 6.25%/Q)     9/23/2013     9.3     9.2 (4)(15)      
        Class A common stock (36,364 shares)         9/23/2013     6.0     2.2 (2)      
                        17.2     13.3        
                        17.2     13.3     0.18 %
Health Clubs                                      
Athletic Club Holdings, Inc.   Premier health club operator   First lien senior secured loan ($3.2 par due 10/2020)   10.84% (Libor + 8.50%/Q)     10/11/2007     3.2     3.2 (3)(15)      
                                       
CFW Co-Invest, L.P. and NCP Curves, L.P.   Health club franchisor   Limited partnership interest (4,152,165 shares)         7/31/2012     4.2     10.7 (2)      
        Limited partnership interest (2,218,235 shares)         7/31/2012         (2)(8)      
                        4.2     10.7        
                                       
Movati Athletic (Group) Inc.(8)(19)   Premier health club operator   First lien senior secured loan ($0.5 par due 10/2022)   6.50% (CIBOR + 4.50%/Q)     10/5/2017     0.6     0.5 (2)(15)      
        First lien senior secured loan ($2.8 par due 10/2022)   6.50% (CIBOR + 4.50%/Q)     10/5/2017     3.0     2.8 (2)(15)      
                        3.6     3.3        
                                       
Sunshine Sub, LLC(19)   Premier health club operator   First lien senior secured loan ($9.8 par due 5/2024)   7.27% (Libor + 4.75%/M)     5/25/2018     9.8     9.7 (2)(15)      
                                       
Taymax Group Acquisition, LLC and TCP Fit Parent, L.P.(19)   Planet Fitness franchisee   First lien senior secured revolving loan ($0.1 par due 7/2024)   7.10% (Libor + 4.75%/M)     7/31/2018     0.1     0.1 (2)(15)      
        First lien senior secured revolving loan ($0.1 par due 7/2024)   6.89% (Libor + 4.75%/M)     7/31/2018     0.1     0.1 (2)(15)      
        First lien senior secured loan ($4.3 par due 7/2025)   7.55% (Libor + 4.75%/Q)     7/31/2018     4.3     4.2 (2)(15)      
        Class A units (30,000 units)         7/31/2018     3.0     3.3        
                        7.5     7.7        
                        28.3     34.6     0.47 %

F-42


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Hotel Services                                      
Pyramid Management Advisors, LLC and Pyramid Investors, LLC(19)   Hotel Operator   First lien senior secured revolving loan ($1.7 par due 7/2021)   9.21% (Libor + 6.75%/M)     4/12/2018     1.7     1.7 (2)(15)(18)      
        First lien senior secured revolving loan ($0.1 par due 7/2021)   9.27% (Libor + 6.75%/M)     4/12/2018     0.1     0.1 (2)(15)(18)      
        First lien senior secured loan ($1.5 par due 7/2021)   9.27% (Libor + 6.75%/M)     4/12/2018     1.5     1.5 (2)(15)      
        First lien senior secured loan ($17.0 par due 7/2021)   9.27% (Libor + 6.75%/M)     4/12/2018     17.0     17.0 (2)(15)      
        Preferred membership units (996,833 units)         7/15/2016     1.0     (2)      
                        21.3     20.3        
                        21.3     20.3     0.28 %
                                       
Telecommunications                                      
CHL, LTD.   Repair and service solutions provider for cable, satellite and telecommunications based service providers   Warrant to purchase up to 120,000 shares of Series A common stock (expires 5/2020)         1/3/2017                
        Warrant to purchase up to 280,000 shares of Series B common stock (expires 5/2020)         1/3/2017                
        Warrant to purchase up to 80,000 shares of Series C common stock (expires 5/2020)         1/3/2017                
                                   
                                       
Extenet Systems, Inc.(19)   Provider of antenna networks for use by wireless service providers, government agencies, healthcare organizations and other commercial enterprises   First lien senior secured revolving loan       2/8/2018         (17)      
                                       
LTG Acquisition, Inc.   Designer and manufacturer of display, lighting and passenger communication systems for mass transportation markets   Class A membership units (5,000 units)         1/3/2017     5.1     4.1        
                                       
Startec Equity, LLC(7)   Communication services   Member interest         4/1/2010                
                                       
TowerCo IV Finance LLC(19)   Owner and operator of cellular telecommunications towers   First lien senior secured revolving loan ($7.2 par due 10/2021)   6.01% (Libor + 3.50%/M)     2/8/2018     7.2     7.2 (2)(15)      
        First lien senior secured revolving loan ($1.2 par due 10/2021)   5.85% (Libor + 3.50%/M)     2/8/2018     1.2     1.2 (2)(15)      
                        8.4     8.4        
                        13.5     12.5     0.17 %
Commercial Real Estate Financial                                      
ACAS Real Estate Holdings Corporation(7)   Real estate holding company   Common stock (1,000 shares)         1/3/2017     2.6     2.0        
                                       
NECCO Realty Investments LLC(7)   Real estate holding company   Membership units (7,450 units)         1/3/2017                
                        2.6     2.0     0.03 %

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(10)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Housing and Building Materials                                      
Halex Holdings, Inc.(7)(19)   Manufacturer of flooring installation products   First lien senior secured revolving loan ($1.9 par due 12/2018)       1/24/2017     1.9            
        Common stock (51,853 shares)         1/3/2017                
                        1.9            
                        1.9         0.00 %
Total Investments                     $ 12,753.8   $ 12,416.7     170.17 %

Derivative Instruments

Foreign currency forward contracts

Description
  Notional
Amount
to be
Purchased
  Notional
Amount
to be sold
  Counterparty   Settlement Date   Unrealized
Appreciation /
(Depreciation)
 

Foreign currency forward contract

  $ 4   CAD 5   Bank of Montreal   1/4/2019   $  

Foreign currency forward contract

  $ 7   CAD 9   Bank of Montreal   1/14/2019      

Foreign currency forward contract

  $ 78   CAD 103   Bank of Montreal   2/15/2019     2  

Foreign currency forward contract

  $ 25   CAD 33   Bank of Montreal   3/22/2019      

Foreign currency forward contract

  $ 17   15   Bank of Montreal   1/14/2019      

Foreign currency forward contract

  $ 1   1   Bank of Montreal   2/15/2019      

Foreign currency forward contract

  $ 27   24   Bank of Montreal   3/6/2019      

Foreign currency forward contract

  $ 94   £ 72   Bank of Montreal   2/15/2019     2  

Total

                      $ 4  

Interest rate swap

Description
  Payment Terms   Counterparty   Maturity Date   Notional
Amount
  Value   Upfront
Payments/
Receipts
  Unrealized
Appreciation /
(Depreciation)
 

Interest rate swap

  Pay fixed 2.0642%   Receive Floating One-Month LIBOR of 2.44%   Bank of Montreal   January 4, 2021   $ 395   $ 4   $   $ 4  

Total

                                    $ 4  

(1)
Other than the Company's investments listed in footnote 7 below (subject to the limitations set forth therein), the Company does not "Control" any of its portfolio companies, for the purposes of the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the "Investment Company Act"). In general, under the Investment Company Act, the Company would "Control" a portfolio company if the Company owned more than 25% of its outstanding voting securities (i.e., securities with the right to elect directors) and/or had the power to exercise control over the management or policies of such portfolio company. All of the Company's portfolio company investments, which as of December 31, 2018 represented 170% of the Company's net assets or 96% of the Company's total assets, are subject to legal restrictions on sales.

(2)
These assets are pledged as collateral for the Revolving Credit Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company's obligations under the Revolving Credit Facility (see Note 5 to the consolidated financial statements).

(3)
These assets are owned by the Company's consolidated subsidiary Ares Capital CP Funding LLC ("Ares Capital CP"), are pledged as collateral for the Revolving Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than Ares Capital CP's obligations under the Revolving Funding Facility (see Note 5 to the consolidated financial statements).

(4)
These assets are owned by the Company's consolidated subsidiary Ares Capital JB Funding LLC ("ACJB"), are pledged as collateral for the SMBC Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than ACJB's obligations under the SMBC Funding Facility (see Note 5 to the consolidated financial statements).

(5)
Investments without an interest rate are non-income producing

(6)
As defined in the Investment Company Act, the Company is deemed to be an "Affiliated Person" because it owns 5% or more of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company (including through a management

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    agreement). Transactions as of and during the year ended December 31, 2018 in which the issuer was an Affiliated Person (but not a portfolio company that the Company is deemed to Control) are as follows:

 
  For the Year Ended December 31, 2018   As of
December 31,
2018
 
(in millions)
Company
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service
fees
  Dividend
income
  Other
income
  Net
realized
gains
(losses)
  Net
unrealized
gains
(losses)
  Fair
Value
 

Blue Wolf Capital Fund II, L.P.

  $   $ 1.4   $   $   $   $   $   $   $ 0.3   $ 2.5  

Campus Management Acquisition Corp.

  $   $   $ 10.5   $   $   $   $   $ 3.2   $ (0.5 ) $ 0.1  

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC

  $ 18.8   $ 7.3   $   $ 2.4   $   $   $ 0.2   $   $ (1.0 ) $ 39.0  

ESCP PPG Holdings, LLC

  $   $   $   $   $   $   $   $   $ (0.4 ) $ 2.4  

European Capital UK SME Debt LP

  $ 7.2   $ 9.7   $   $   $   $ 2.0   $   $   $ 0.3   $ 39.5  

Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Imperial Capital Private Opportunities, LP

  $ 0.1   $ 1.1   $   $   $   $ 2.1   $   $ 12.0   $ (13.9 ) $  

Ioxus, Inc

  $   $ 4.4   $   $ 1.0   $   $   $   $ 0.1   $ (0.1 ) $ 7.0  

NSI Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Panda Temple Power, LLC and T1 Power Holdings LLC

  $   $ 0.4   $   $ 0.7   $   $   $   $   $ 3.2   $ 21.9  

Partnership Capital Growth Fund I, L.P.

  $   $   $   $   $   $   $   $   $   $ 0.1  

PCG-Ares Sidecar Investment, L.P.

  $ 0.1   $   $   $   $   $   $   $   $ (0.9 ) $ 4.4  

PCG-Ares Sidecar Investment II, L.P.

  $   $ 0.9   $   $   $   $   $   $   $ 6.7   $ 17.4  

Petroflow Energy Corporation and TexOak Petro Holdings LLC

  $   $ 3.1   $   $ 0.1   $   $   $   $ 0.2   $ (1.0 ) $ 8.3  

PIH Corporation and Primrose Holding Corporation

  $   $   $   $ 0.2   $   $   $   $   $ 5.2   $ 25.6  

Qualium Investissement

  $   $ 0.7   $   $   $   $   $   $ 0.9   $ (0.7 ) $  

Shock Doctor, Inc. and Shock Doctor Holdings, LLC

  $   $   $   $ 12.0   $   $   $ 0.3   $   $ (4.6 ) $ 81.5  

Things Remembered, Inc. and TRM Holdco Corp.

  $ 3.0   $ 1.6   $ 17.8   $ 0.1   $   $   $   $ (15.9 ) $ 15.1   $  

UL Holding Co., LLC

  $   $   $   $ 3.5   $   $   $   $   $ (3.7 ) $ 42.2  

  $ 29.2   $ 30.6   $ 28.3   $ 20.0   $   $ 4.1   $ 0.5   $ 0.5   $ 4.0   $ 291.9  
(7)
As defined in the Investment Company Act, the Company is deemed to be both an "Affiliated Person" and "Control" this portfolio company because it owns more than 25% of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company

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(including through a management agreement). Transactions as of and during the year ended December 31, 2018 in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to Control are as follows:
 
  For the Year Ended December 31, 2018   As of
December 31, 2018
 
(in millions)
Company
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service
fees
  Dividend
income
  Other
income
  Net
realized
gains
(losses)
  Net
unrealized
gains
(losses)
  Fair Value  

ACAS Equity Holdings Corporation

  $   $   $   $   $   $   $   $   $ 0.1   $ 0.4  

ACAS Real Estate Holdings Corporation

  $   $   $   $   $   $   $   $   $ (0.2 ) $ 2.0  

ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.

  $   $   $   $ 1.0   $   $   $   $   $ (11.2 ) $ 5.5  

Alcami Holdings, LLC

  $ 4.4   $ 125.1   $ 166.1   $ 19.5   $   $   $ 8.0   $ 323.9   $ (166.8 ) $  

Ares IIIR/IVR CLO Ltd.

  $   $   $   $   $   $   $   $   $   $  

Callidus Capital Corporation

  $   $   $ 3.0   $   $   $   $   $ (0.8 ) $ 1.3   $  

Champion Parent Corporation and Calera XVI, LLC

  $   $ 0.8   $   $   $   $   $   $ (0.7 ) $ 0.6   $  

CoLTS 2005-1

  $   $   $   $   $   $   $   $   $   $  

CoLTS 2005-2

  $   $   $   $   $   $   $   $   $   $  

Columbo Midco Limited, Columbo Bidco Limited and Columbo Topco Limited

  $   $   $ 27.9   $   $   $   $   $ 6.2   $ (12.7 ) $  

CSHM LLC

  $   $   $   $   $   $   $   $   $   $  

Eckler Industries, Inc. and Eckler Purchaser LLC

  $ 1.3   $   $   $   $   $   $   $ (2.0 ) $ 5.4   $ 22.7  

ETG Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Fashion Holding Luxembourg SCA (Modacin/Camaeiu)

  $   $   $   $   $   $   $   $   $   $  

FPI Holding Corporation

  $   $ 0.4   $   $   $   $   $   $ (0.4 ) $ 1.0   $  

Halex Holdings, Inc.

  $ 0.8   $   $   $   $   $   $   $   $   $  

HCI Equity, LLC

  $   $   $   $   $   $   $   $   $   $ 0.1  

Imaging Business Machines, L.L.C. and Scanner Holdings Corporation

  $   $   $   $ 2.4   $   $   $ 0.6   $   $ 3.4   $ 24.6  

Ivy Hill Asset Management, L.P.

  $ 263.0   $ 63.0   $   $ 1.0   $   $ 58.0   $   $   $ 2.8   $ 517.9  

Joyce Lane Capital LLC

  $ 0.8   $ 26.2   $   $ 0.6   $   $   $   $ (5.9 ) $ (3.0 ) $ 3.9  

LLSC Holdings Corporation (dba Lawrence Merchandising Services)

  $   $ 17.4   $   $   $   $   $   $   $ (0.3 ) $ 0.4  

Miles 33 (Finance) Limited

  $   $ 15.0   $   $ 1.6   $   $   $   $ (4.3 ) $ (3.9 ) $  

Montgomery Lane, LLC and Montgomery Lane, Ltd.

  $   $   $   $   $   $   $   $   $ (0.6 ) $  

MVL Group, Inc.

  $   $   $   $   $   $   $   $   $   $  

Navisun LLC and Navisun Holdings LLC

  $ 23.5   $   $   $ 1.3   $ 0.3   $ 0.2   $ 0.2   $   $   $ 27.9  

NECCO Holdings, Inc. and New England Confectionery Company, Inc.

  $ 14.4   $ 14.7   $   $   $   $   $   $   $ (5.7 ) $ 4.6  

NECCO Realty Investments LLC

  $   $   $   $   $   $   $   $   $   $  

Orion Foods, LLC

  $   $   $   $   $   $   $   $   $   $ 0.4  

PHL Investors, Inc., and PHL Holding Co.

  $   $   $   $   $   $   $   $   $   $  

Rug Doctor, LLC and RD Holdco Inc.

  $   $   $   $ 2.1   $   $   $   $   $ 0.3   $ 28.1  

S Toys Holdings LLC (fka The Step2 Company, LLC)

  $   $   $   $   $   $   $   $   $ (0.1 ) $ 0.4  

Senior Direct Lending Program, LLC

  $ 252.2   $ 87.6   $   $ 86.9   $ 11.6   $   $ 4.2   $   $   $ 651.7  

Singer Sewing Company, SVP-Singer Holdings, LLC and SVP-Singer Holdings LP

  $ 98.0   $ 21.5   $   $ 13.6   $ 1.3   $   $ 4.6   $   $ (6.8 ) $ 235.6  

Soil Safe, Inc. and Soil Safe Acquisition Corp.

  $   $ 4.0   $   $ 14.8   $   $   $ 0.4   $   $ 6.2   $ 120.7  

Startec Equity, LLC

  $   $   $   $   $   $   $   $   $   $  

The Greeley Company, Inc. and HCP Acquisition Holdings, LLC

  $   $ 0.1   $   $   $   $   $   $   $   $  

  $ 658.4   $ 375.8   $ 197.0   $ 144.8   $ 13.2   $ 58.2   $ 18.0   $ 316.0   $ (190.2 ) $ 1,646.9  

*
Together with Varagon Capital Partners ("Varagon") and its clients, the Company has co-invested through the Senior Direct Lending Program LLC (d/b/a the "Senior Direct Lending Program" or the "SDLP"). The SDLP has been capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of the Company and Varagon (with approval from a representative of each required); therefore, although the Company owns more than 25% of the voting securities of the SDLP, the Company does not believe that it has control over the SDLP (for purposes of the Investment Company Act or otherwise) because, among other things, these "voting securities" do not afford the Company the right to elect directors of the SDLP or any other special rights (see Note 4 to the consolidated financial statements).
(8)
Non-U.S. company or principal place of business outside the U.S. and as a result is not a qualifying asset under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of the Company's total assets. Pursuant to Section 55(a) of the Investment Company Act, 14% of the Company's total assets are represented by investments at fair value and other assets that are considered "non-qualifying assets" as of December 31, 2018.

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(9)
Exception from the definition of investment company under Section 3(c) of the Investment Company Act and as a result is not a qualifying asset under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of the Company's total assets.

(10)
Variable rate loans to the Company's portfolio companies bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate ("LIBOR") or an alternate base rate (commonly based on the Federal Funds Rate or the Prime Rate), at the borrower's option, which reset annually (A), semi-annually (S), quarterly (Q), bi-monthly (B), monthly (M) or daily (D). For each such loan, the Company has provided the interest rate in effect on the date presented.

(11)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on $69.5 in aggregate principal amount of a "first out" tranche of the portfolio company's senior term debt previously syndicated by the Company into "first out" and "last out" tranches, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(12)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on $38.7 in aggregate principal amount of a "first out" tranche of the portfolio company's first lien senior secured loans, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(13)
The Company sold a participating interest of approximately $2.0 in aggregate principal amount of the portfolio company's first lien senior secured term loan. As the transaction did not qualify as a "true sale" in accordance with U.S. generally accepted accounting principles, the Company recorded a corresponding $2.0 secured borrowing included in "accounts payable and other liabilities" in the accompanying consolidated balance sheet.

(14)
Loan was on non-accrual status as of December 31, 2018.

(15)
Loan includes interest rate floor feature.

(16)
In addition to the interest earned based on the stated contractual interest rate of this security, the certificates entitle the holders thereof to receive a portion of the excess cash flow from the SDLP's loan portfolio, after expenses, which may result in a return to the Company greater than the contractual stated interest rate.

(17)
As of December 31, 2018, no amounts were funded by the Company under this first lien senior secured revolving loan; however, there were letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 to the consolidated financial statements for further information on letters of credit commitments related to certain portfolio companies.

(18)
As of December 31, 2018, in addition to the amounts funded by the Company under this first lien senior secured revolving loan, there were also letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 to the consolidated financial statements for further information on letters of credit commitments related to certain portfolio companies.

(19)
As of December 31, 2018, the Company had the following commitments to fund various revolving and delayed draw senior secured and subordinated loans, including commitments to issue letters of credit through a financial intermediary on behalf of certain portfolio companies. Such commitments are subject to the satisfaction of certain conditions set forth in the documents governing these loans and letters of credit and there can be no assurance that such conditions will be satisfied. See Note 7 to the consolidated financial statements for further information on revolving and delayed draw loan commitments, including commitments to issue letters of credit, related to certain portfolio companies.
(in millions)
Portfolio Company
  Total revolving
and delayed
draw loan
commitments
  Less: drawn
commitments
  Total
undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

1A Smart Start, LLC

  $ 3.5   $ (0.1 ) $ 3.4   $   $   $ 3.4  

42 North Dental, LLC (fka Gentle Communications, LLC)

    5.0         5.0             5.0  

A.U.L. Corp.

    1.2         1.2             1.2  

Accommodations Plus Technologies LLC

    4.1         4.1             4.1  

Achilles Acquisition LLC

    12.4         12.4             12.4  

ADCS Billings Intermediate Holdings, LLC

    5.0     (1.3 )   3.7             3.7  

ADF Capital, Inc.

    1.3         1.3             1.3  

ADG, LLC

    13.7     (11.2 )   2.5             2.5  

Alcami Corporation

    29.0     (3.5 )   25.5             25.5  

AMCP Clean Intermediate, LLC

    4.7     (1.2 )   3.5             3.5  

American Academy Holdings, LLC

    7.0     (0.9 )   6.1             6.1  

AMZ Holding Corp.

    3.4         3.4             3.4  

Apex Clean Energy Holdings, LLC

    5.0     (5.0 )                

Avetta, LLC

    7.0         7.0             7.0  

Bambino CI Inc.

    9.6     (0.3 )   9.3             9.3  

Blue Campaigns Intermediate Holding Corp.

    3.0         3.0             3.0  

Cadence Aerospace, LLC

    14.3     (0.5 )   13.8             13.8  

Capstone Logistics Acquisition, Inc.

    2.0     (0.9 )   1.1             1.1  

Care Hospice, Inc

    2.3     (0.3 )   2.0             2.0  

CB Trestles OpCo, LLC

    32.2         32.2             32.2  

CCS-CMGC Holdings, Inc.

    12.0     (7.9 )   4.1             4.1  

Center for Autism and Related Disorders, LLC

    8.5     (0.4 )   8.1             8.1  

Centric Brands Inc.

                         

Chariot Acquisition, LLC

    1.0         1.0             1.0  

Chesapeake Research Review, LLC

    5.8         5.8             5.8  

Clearwater Analytics, LLC

    5.0         5.0             5.0  

Command Alkon Incorporated

    6.3     (3.0 )   3.3             3.3  

Comprehensive EyeCare Partners, LLC

    3.7     (0.2 )   3.5             3.5  

Corepoint Health, LLC

    4.3         4.3             4.3  

Cozzini Bros., Inc. and BH-Sharp Holdings LP

    24.2     (1.5 )   22.7             22.7  

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(in millions)
Portfolio Company
  Total revolving
and delayed
draw loan
commitments
  Less: drawn
commitments
  Total
undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC

    7.5     (0.9 )   6.6             6.6  

CST Buyer Company

    4.2         4.2             4.2  

D4C Dental Brands, Inc.

    5.0     (3.3 )   1.7             1.7  

DCA Investment Holding, LLC

    5.8     (0.4 )   5.4             5.4  

DecoPac, Inc.

    8.1         8.1             8.1  

DFC Global Facility Borrower II LLC

    115.0     (94.6 )   20.4             20.4  

DGH Borrower LLC

    22.5         22.5             22.5  

Dorner Holding Corp.

    3.3     (0.2 )   3.1             3.1  

Doxim Inc.

    2.4         2.4             2.4  

DRB Holdings, LLC

    9.9     (3.3 )   6.6             6.6  

DTI Holdco, Inc. and OPE DTI Holdings, Inc.

    8.8     (2.2 )   6.6             6.6  

Eckler Industries, Inc.

    2.0     (1.3 )   0.7     (0.8 )       (0.1 )

Emergency Communications Network, LLC

    6.5         6.5             6.5  

Emerus Holdings, Inc.

    4.5     (3.0 )   1.5             1.5  

EN Engineering, LLC

    5.0         5.0             5.0  

Entertainment Partners, LLC and Entertainment Partners Canada Inc.

    28.0         28.0             28.0  

Episerver, Inc.

    10.3         10.3             10.3  

ExteNet Systems, Inc.

    2.0         2.0             2.0  

Ferraro Fine Foods Corp.

    9.8     (1.3 )   8.5             8.5  

Flinn Scientific, Inc.

    10.0         10.0             10.0  

Flow Control Solutions, Inc.

    14.4     (0.4 )   14.0             14.0  

FM:Systems Group, LLC

    1.4         1.4             1.4  

Foundation Risk Partners, Corp.

    25.0         25.0             25.0  

Frontline Technologies Group Holding LLC

    8.4         8.4             8.4  

FWR Holding Corporation

    2.1     (0.8 )   1.3             1.3  

Garden Fresh Restaurant Corp.

    7.5     (3.5 )   4.0             4.0  

GB Auto Service, Inc.

    34.4         34.4             34.4  

Genesis Acquisition Co.

    9.4         9.4             9.4  

GraphPAD Software, LLC

    1.1         1.1             1.1  

GTCR-Ultra Acquisition, Inc. and GTCR-Ultra Holdings, LLC

    2.0         2.0             2.0  

HAI Acquisition Corporation

    19.0         19.0             19.0  

Halex Holdings, Inc.

    2.0     (1.9 )   0.1             0.1  

Harvey Tool Company, LLC

    38.7     (0.7 )   38.0             38.0  

Help/Systems Holdings, Inc.

    5.0     (1.0 )   4.0             4.0  

Hometown Food Company

    3.9         3.9             3.9  

Hygiena Borrower LLC

    12.4     (0.2 )   12.2             12.2  

IMIA Holdings, Inc.

    9.9     (0.4 )   9.5             9.5  

Implementation Management Assistance, LLC

    16.6     (5.5 )   11.1             11.1  

Infilaw Holding, LLC

    6.2     (6.2 )                

Infinite Electronics International, Inc.

    3.0         3.0             3.0  

Infogix, Inc.

    5.3         5.3             5.3  

iPipeline, Inc.

    4.0         4.0             4.0  

JDC Healthcare Management, LLC

    9.8     (0.8 )   9.0             9.0  

Jim N Nicks Management, LLC

    9.7     (2.8 )   6.9             6.9  

Joyce Lane Capital LLC and Joyce Lane Financing SPV LLC (fka Ciena Capital LLC)

    1.3         1.3             1.3  

Kaufman, Hall & Associates, LLC

    8.0         8.0             8.0  

KBHS Acquisition, LLC (d/b/a Alita Care, LLC)

    5.0     (4.6 )   0.4             0.4  

Key Surgical LLC

    2.8         2.8             2.8  

KHC Holdings, Inc.

    6.9     (0.7 )   6.2             6.2  

Labstat International Inc.

    3.8         3.8             3.8  

LBP Intermediate Holdings LLC

    0.9     (0.1 )   0.8             0.8  

Liaison Acquisition, LLC

    3.9         3.9             3.9  

Lone Wolf Real Estate Technologies Inc.

    3.0         3.0             3.0  

Mac Lean-Fogg Company

    24.2         24.2             24.2  

Magento, Inc.

    7.5     (0.2 )   7.3             7.3  

Masergy Holdings, Inc.

    2.5     (0.2 )   2.3             2.3  

Massage Envy, LLC

    11.2         11.2             11.2  

Mavis Tire Express Services Corp.

    23.3         23.3             23.3  

MB2 Dental Solutions, LLC

    3.5     (2.7 )   0.8             0.8  

McKenzie Sports Products, LLC

    4.5     (2.9 )   1.6             1.6  

Ministry Brands, LLC

    28.6         28.6             28.6  

Movati Athletic (Group) Inc.

    2.3         2.3             2.3  

MSHC, Inc.

    18.9     (1.6 )   17.3             17.3  

Murchison Oil and Gas, LLC

    20.0         20.0             20.0  

MW Dental Holding Corp.

    17.1     (7.0 )   10.1             10.1  

National Intergovernmental Purchasing Alliance Company

    9.0         9.0             9.0  

Navisun LLC

    20.8         20.8             20.8  

NECCO Holdings, Inc.

    25.0     (19.9 )   5.1     (5.1 )        

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Table of Contents

(in millions)
Portfolio Company
  Total revolving
and delayed
draw loan
commitments
  Less: drawn
commitments
  Total
undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

NM GRC HOLDCO, LLC

    1.4         1.4             1.4  

NMC Skincare Intermediate Holdings II, LLC

    17.4         17.4             17.4  

NMN Holdings III Corp

    12.5         12.5             12.5  

Nordco Inc.

    12.5     (1.3 )   11.2             11.2  

NSM Sub Holdings Corp.

    6.6         6.6             6.6  

NueHealth Performance, LLC

    7.0         7.0             7.0  

Osmose Utilities Services, Inc.

    6.0     (2.5 )   3.5             3.5  

OTG Management, LLC

    16.3     (10.0 )   6.3             6.3  

Paper Source, Inc.

    2.5     (1.9 )   0.6             0.6  

Park Place Technologies, LLC

    5.4         5.4             5.4  

Pathway Vet Alliance LLC

    163.8         163.8             163.8  

Payment Alliance International, Inc.

    4.2     (3.4 )   0.8             0.8  

PDI TA Holdings, Inc.

    21.4         21.4             21.4  

Pegasus Intermediate Holdings, LLC

    5.0         5.0             5.0  

PIH Corporation and Primrose Holding Corporation

    3.3     (1.0 )   2.3             2.3  

Practice Insight, LLC

    2.9         2.9             2.9  

Premise Health Holding Corp.

    40.0     (6.0 )   34.0             34.0  

Pyramid Management Advisors, LLC

    5.5     (1.9 )   3.6             3.6  

QC Supply, LLC

    17.9     (9.0 )   8.9             8.9  

R1 RCM Inc.

    10.0         10.0             10.0  

Raptor Technologies, LLC

    10.1         10.1             10.1  

RecoveryDirect Acquisition, L.L.C.

    8.0         8.0             8.0  

Retriever Medical/Dental Payments LLC

    3.5         3.5             3.5  

Rialto Management Group, LLC

    1.0         1.0             1.0  

RMP Group, Inc.

    1.8         1.8             1.8  

RuffaloCODY, LLC

    7.7     (0.2 )   7.5             7.5  

Salter Labs

    1.7     (1.0 )   0.7             0.7  

Sanders Industries Holdings, Inc.

    10.0         10.0             10.0  

SCM Insurance Services Inc.

    4.0     (2.4 )   1.6             1.6  

SCSG EA Acquisition Company, Inc.

    4.0     (0.2 )   3.8             3.8  

SecurAmerica, LLC

    20.8         20.8             20.8  

Securelink, Inc

    3.0         3.0             3.0  

Severin Acquisition, LLC

    9.0         9.0             9.0  

SFE Intermediate Holdco LLC

    10.2         10.2             10.2  

Shift PPC LLC

    4.4         4.4             4.4  

Singer Sewing Company

    90.0     (77.9 )   12.1             12.1  

SiroMed Physician Services, Inc.

    7.1         7.1             7.1  

Siteworx Holdings, LLC

    1.5     (1.5 )                

SM Wellness Holdings, Inc.

    10.5         10.5             10.5  

Soil Safe, Inc. and Soil Safe Acquisition Corp.

    10.5     (3.6 )   6.9             6.9  

Sonny's Enterprises, LLC

    3.6     (0.2 )   3.4             3.4  

Sovos Brands Intermediate, Inc.

    4.3         4.3             4.3  

SpareFoot, LLC

    1.4     (0.3 )   1.1             1.1  

Sparta Systems, Inc.

    6.5         6.5             6.5  

Spectra Finance, LLC

    24.1     (5.5 )   18.6             18.6  

St. Croix Acquisition Corp.

    2.0         2.0             2.0  

Storm UK Holdco Limited and Storm US Holdco Inc.

    1.1         1.1             1.1  

Sunk Rock Foundry Partners LP

    10.0     (2.6 )   7.4             7.4  

Sunshine Sub, LLC

    7.7         7.7             7.7  

Symmetry Surgical Inc.

    3.1         3.1             3.1  

Synergy HomeCare Franchising, LLC

    4.2         4.2             4.2  

Syntax USA Acquisition Corporation

    3.3     (1.8 )   1.5             1.5  

Taymax Group Holdings, LLC

    3.2     (0.2 )   3.0             3.0  

TDG Group Holding Company

    20.7     (0.1 )   20.6             20.6  

Teasdale Foods, Inc.

    0.8     (0.7 )   0.1             0.1  

Telestream Holdings Corporation

    2.3     (0.6 )   1.7             1.7  

Teligent, Inc.

    22.8         22.8             22.8  

Tidi Products, LLC

    2.3         2.3             2.3  

Total Community Options, Inc.

    4.2         4.2             4.2  

Touchstone Acquisition, Inc.

    11.2         11.2             11.2  

Towerco IV Finance, LLC

    17.0     (8.4 )   8.6             8.6  

TPTM Merger Corp.

    4.3         4.3             4.3  

TU BidCo, Inc.

    18.5         18.5             18.5  

U.S. Acute Care Solutions, LLC

    1.7         1.7             1.7  

United Digestive MSO Parent, LLC

    17.2         17.2             17.2  

Urgent Cares of America Holdings I, LLC

    10.0         10.0             10.0  

Utility Pipeline, LTD.

    3.0     (0.1 )   2.9             2.9  

Vela Trading Technologies, LLC

    3.5     (0.5 )   3.0             3.0  

Verscend Holding Corp.

    22.5         22.5             22.5  

Veson Nautical LLC

    2.5         2.5             2.5  

Visual Edge Technology, Inc.

    0.8         0.8             0.8  

VLS Recovery Services, LLC

    20.6     (3.5 )   17.1             17.1  

VRC Companies, LLC

    3.1     (0.8 )   2.3             2.3  

F-49


Table of Contents

(in millions)
Portfolio Company
  Total revolving
and delayed
draw loan
commitments
  Less: drawn
commitments
  Total
undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

WatchFire Enterprises, Inc.

    2.0         2.0             2.0  

West Dermatology, LLC

    18.3     (5.0 )   13.3             13.3  

WIRB—Copernicus Group, Inc

    3.0         3.0             3.0  

Woodstream Group, Inc. and Woodstream Corporation

    4.7         4.7             4.7  

Worldwide Facilities LLC

    2.3     (0.4 )   1.9             1.9  

Wrench Group LLC

    2.8         2.8             2.8  

WSHP FC Acquisition LLC

    5.8     (3.3 )   2.5             2.5  

XIFIN, Inc.

    4.6         4.6             4.6  

Zemax Software Holdings, LLC

    4.1         4.1             4.1  

Zywave, Inc.

    11.5     (6.3 )   5.2             5.2  

  $ 1,915.3   $ (376.9 ) $ 1,538.4   $ (5.9 ) $   $ 1,532.5  
(20)
As of December 31, 2018, the Company was party to subscription agreements to fund equity investments in private equity investment partnerships as follows:
(in millions)
Company
  Total
private
equity
commitments
  Less:
funded
private
equity
commitments
  Total
unfunded
private
equity
commitments
  Less: private equity
commitments
substantially at
the discretion
of the Company
  Total net adjusted
unfunded private
equity
commitments
 

Partnership Capital Growth Investors III, L.P.

  $ 5.0   $ (4.9 ) $ 0.1   $   $ 0.1  

PCG-Ares Sidecar Investment, L.P. and PCG-Ares Sidecar Investment II, L.P.

    50.0     (12.4 )   37.6     (37.6 )    

Piper Jaffray Merchant Banking Fund I, L.P.

    2.0     (2.0 )            

European Capital UK SME Debt LP

    57.4     (53.9 )   3.5     (3.5 )    

  $ 114.4   $ (73.2 ) $ 41.2   $ (41.1 ) $ 0.1  
(21)
As of December 31, 2018, the Company had commitments to co-invest in the SDLP for its portion of the SDLP's commitment to fund delayed draw loans of up to $39. See Note 4 to the consolidated financial statements for more information on the SDLP.

(22)
Other than the investments noted by this footnote, the fair value of the Company's investments is determined using unobservable inputs that are significant to the overall fair value measurement. See Note 8 to the consolidated financial statements for more information regarding the fair value of the Company's investments.

(23)
As of December 31, 2018, the net estimated unrealized loss for federal tax purposes was $0.6 billion based on a tax cost basis of $13.0 billion. As of December 31, 2018, the estimated aggregate gross unrealized loss for federal income tax purposes was $0.9 billion and the estimated aggregate gross unrealized gain for federal income tax purposes was $0.3 billion.

F-50


Table of Contents


ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of December 31, 2017
(dollar amounts in millions)

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Healthcare Services                                      
Absolute Dental Management LLC and ADM Equity, LLC   Dental services provider   First lien senior secured loan ($18.8 par due 1/2022)   11.08% (Libor + 9.39%/Q)     1/5/2016   $ 18.8   $ 17.6 (2)(17)      
        First lien senior secured loan ($5.0 par due 1/2022)   11.08% (Libor + 9.39%/Q)     1/5/2016     5.0     4.7 (4)(17)      
        Class A preferred units (4,000,000 units)         1/5/2016     4.0     0.9 (2)      
        Class A common units (4,000,000 units)         1/5/2016         (2)      
                        27.8     23.2        
                                       
Acessa Health Inc. (fka HALT Medical, Inc.)   Medical supply provider   Common stock (569,823 shares)         6/22/2017     0.1            
                                       
ADCS Billings Intermediate Holdings, LLC(21)   Dermatology practice   First lien senior secured revolving loan       5/18/2016         (19)      
                                       
ADG, LLC and RC IV GEDC Investor LLC(21)   Dental services provider   First lien senior secured revolving loan ($1.0 par due 9/2022)   6.14% (Libor + 4.75%/Q)     9/28/2016     1.0     1.0 (2)(17)      
        First lien senior secured revolving loan ($1.4 par due 9/2022)   6.24% (Libor + 4.75%/Q)     9/28/2016     1.4     1.3 (2)(17)      
        First lien senior secured revolving loan ($8.5 par due 9/2022)   6.32% (Libor + 4.75%/Q)     9/28/2016     8.5     8.3 (2)(17)      
        First lien senior secured revolving loan ($0.6 par due 9/2022)   8.25% (Base Rate + 3.75%/Q)     9/28/2016     0.6     0.6 (2)(17)      
        Second lien senior secured loan ($87.5 par due 3/2024)   10.57% (Libor + 9.00%/Q)     9/28/2016     87.5     81.4 (2)(17)      
        Membership units (3,000,000 units)         9/28/2016     3.0     1.9 (2)      
                        102.0     94.5        
                                       
Alcami Holdings, LLC(8)(21)   Outsourced drug development services provider   First lien senior secured revolving loan ($2.0 par due 10/2019)   6.89% (Libor + 5.50%/Q)     1/3/2017     2.0     2.0 (2)(17)      
        First lien senior secured revolving loan ($15.9 par due 10/2019)   6.96% (Libor + 5.50%/Q)     1/3/2017     15.9     15.9 (2)(17)      
        First lien senior secured revolving loan ($7.7 par due 10/2019)   7.06% (Libor + 5.50%/Q)     1/3/2017     7.7     7.7 (2)(17)      
        First lien senior secured loan ($10.0 par due 10/2020)   7.07% (Libor + 5.50%/Q)     1/3/2017     10.0     10.0 (2)(17)      
        First lien senior secured loan ($95.7 par due 10/2020)   7.07% (Libor + 5.50%/Q)     1/3/2017     95.7     95.7 (3)(17)      
        First lien senior secured loan ($0.2 par due 10/2020)   11.00% (Base Rate + 6.50%/Q)     1/3/2017     0.2     0.2 (3)(17)      
        Senior subordinated loan ($30.0 par due 10/2020)   11.75%     1/3/2017     30.0     30.0 (2)      
        Senior subordinated loan ($30.0 par due 10/2020)   12.00%     1/3/2017     30.0     30.0 (2)      
        Senior subordinated loan ($25.0 par due 10/2020)   12.25%     1/3/2017     25.0     25.0 (2)      
        Senior subordinated loan ($36.1 par due 10/2020)   14.75% PIK     1/3/2017     36.1     36.1 (2)      
        Senior subordinated loan ($36.6 par due 10/2020)   15.25% PIK     1/3/2017     22.8     36.6 (2)      
        Series R preferred membership units (30,000 units)         1/3/2017         54.1        
        Series R-2 preferred membership units (54,936 units)         1/3/2017         99.0        
                        275.4     442.3        

F-51


Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Alegeus Technologies Holdings Corp.   Benefits administration and transaction processing provider   Preferred stock (2,997 shares)         12/13/2013     3.1     2.8        
        Common stock (3 shares)         12/13/2013                
                        3.1     2.8        
                                       
Alteon Health, LLC   Provider of physician management services   First lien senior secured loan ($3.5 par due 9/2022)   7.00% (Libor + 5.50%/Q)     5/15/2017     3.5     3.3 (2)(17)      
                                       
American Academy Holdings, LLC(21)   Provider of education, training, certification, networking, and consulting services to medical coders and other healthcare professionals   First lien senior secured revolving loan ($0.9 par due 12/2022)   9.75% (Base Rate + 5.25%/Q)     12/15/2017     0.9     0.9 (2)(17)      
        First lien senior secured loan ($0.5 par due 12/2022)   7.84% (Libor + 6.25%/Q)     12/15/2017     0.5     0.5 (2)(17)      
        First lien senior secured loan ($199.8 par due 12/2022)   8.01% (Libor + 6.25%/Q)     12/15/2017     199.8     197.8 (2)(17)      
        Senior subordinated loan ($75.0 par due 6/2023)   15.76% (Libor + 14.00%/Q)     12/15/2017     75.0     73.5 (2)(17)      
                        276.2     272.7        
                                       
Argon Medical Devices, Inc.   Manufacturer and marketer of single-use specialty medical devices   Second lien senior secured loan ($9.0 par due 6/2022)   11.07% (Libor + 9.50%/Q)     12/23/2015     8.8     9.0 (2)(17)      
                                       
AwarePoint Corporation   Healthcare technology platform developer   First lien senior secured loan ($8.1 par due 12/2019)   13.98% (Libor + 12.50%/M)     9/5/2014     8.0     6.5 (2)(15)(17)      
        Warrant to purchase up to 3,213,367 shares of Series 1 preferred stock (expires 9/2024)         11/14/2014         0.4 (2)      
                        8.0     6.9        
                                       
Bambino CI Inc.(21)   Manufacturer and provider of single-use obstetrics products   First lien senior secured revolving loan ($1.1 par due 10/2022)   7.49% (Libor + 6.00%/Q)     10/17/2017     1.1     1.1 (2)(17)      
        First lien senior secured loan ($43.7 par due 10/2023)   7.49% (Libor + 6.00%/Q)     10/17/2017     43.7     43.3 (2)(17)      
                        44.8     44.4        
                                       
CCS Intermediate Holdings, LLC and CCS Group Holdings, LLC(21)   Correctional facility healthcare operator   First lien senior secured revolving loan ($4.5 par due 7/2019)   5.69% (Libor + 4.00%/Q)     7/23/2014     4.5     4.1 (2)(17)(20)      
        First lien senior secured loan ($6.5 par due 7/2021)   5.69% (Libor + 4.00%/Q)     7/23/2014     6.5     5.9 (2)(17)      
        Second lien senior secured loan ($135.0 par due 7/2022)   9.86% (Libor + 8.38%/Q)     7/23/2014     134.2     112.0 (2)(17)      
        Class A units (1,000,000 units)         8/19/2010         0.9 (2)      
                        145.2     122.9        
                                       
Correctional Medical Group Companies, Inc.   Correctional facility healthcare operator   First lien senior secured loan ($48.8 par due 9/2021)   9.62% (Libor + 8.62%/Q)     9/29/2015     48.8     48.8 (3)(17)      
        First lien senior secured loan ($3.1 par due 9/2021)   9.62% (Libor + 8.62%/Q)     9/29/2015     3.1     3.1 (2)(17)      
                        51.9     51.9        
                                       
CSHM LLC(8)   Dental services provider   Class A membership units (1,979 units)         1/3/2017                
                                       
D4C Dental Brands HoldCo, Inc. and Bambino Group Holdings, LLC(21)   Dental services provider   Class A preferred units (1,000,000 units)         12/21/2016     1.0     1.1 (2)      
                                       
DCA Investment Holding, LLC(21)   Multi-branded dental practice management   First lien senior secured revolving loan       7/2/2015         (19)      
        First lien senior secured loan ($18.7 par due 7/2021)   6.94% (Libor + 5.25%/Q)     7/2/2015     18.6     18.4 (4)(17)      
                        18.6     18.4        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Drayer Physical Therapy Institute LLC   Outpatient physical therapy provider   First lien senior secured loan ($12.3 par due 7/2018)   10.50% (Base Rate + 6.00%/Q)     7/26/2017     12.3     12.3 (2)(17)      
        First lien senior secured loan ($114.6 par due 7/2018)   10.50% (Base Rate + 6.00%/Q)     7/26/2017     114.6     114.6 (2)(17)      
                        126.9     126.9        
                                       
Emerus Holdings, Inc.(21)   Freestanding 24-hour emergency care micro-hospitals operator   First lien senior secured revolving loan ($0.3 par due 9/2020)   8.00% (Base Rate + 3.50%/Q)     3/14/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($2.3 par due 9/2021)   6.07% (Libor + 4.50%/Q)     3/14/2017     2.0     2.1 (2)(17)      
                        2.3     2.4        
                                       
GHX Ultimate Parent Corporation, Commerce Parent, Inc. and Commerce Topco, LLC   On-demand supply chain automation solutions provider to the healthcare industry   Second lien senior secured loan ($103.7 par due 6/2025)   9.69% (Libor + 8.00%/Q)     6/30/2017     102.8     103.7 (2)(17)      
        Series A perpetual preferred stock (110,425 shares)   12.44% PIK (Libor + 10.75%/Q)     6/30/2017     117.4     117.4 (2)(17)      
        Class A units (14,013,303 units)         6/30/2017     14.0     16.9 (2)      
                        234.2     238.0        
                                       
Greenphire, Inc. and RMCF III CIV XXIX, L.P   Software provider for clinical trial management   Limited partnership interest (99.90% interest)         12/19/2014     1.0     2.4 (2)      
                                       
Heartland Dental, LLC   Detanl services provider   Second lien senior secured loan ($27.8 par due 7/2024)   9.75% (Libor + 8.50%/Q)     7/31/2017     27.4     27.8 (2)(17)      
                                       
Hygiena Borrower LLC(21)   Adenosine triphosphate testing technology provider   Second lien senior secured loan ($10.0 par due 8/2023)   10.69% (Libor + 9.00%/Q)     8/26/2016     10.0     10.0 (2)(17)      
        Second lien senior secured loan ($10.7 par due 8/2023)   10.69% (Libor + 9.00%/Q)     2/27/2017     10.7     10.7 (2)(17)      
                        20.7     20.7        
                                       
Intermedix Corporation   Revenue cycle management provider to the emergency healthcare industry   First lien senior secured loan ($72.3 par due 12/2019)   6.16% (Libor + 4.75%/Q)     7/26/2017     72.3     70.8 (2)(17)      
        First lien senior secured loan ($35.2 par due 12/2019)   6.16% (Libor + 4.75%/Q)     7/26/2017     35.2     34.5 (3)(17)      
        First lien senior secured loan ($9.3 par due 12/2019)   6.16% (Libor + 4.75%/Q)     7/26/2017     9.3     9.1 (4)(17)      
        First lien senior secured loan ($80.8 par due 12/2019)   6.35% (Libor + 4.75%/Q)     7/26/2017     80.8     79.2 (2)(17)      
        First lien senior secured loan ($39.3 par due 12/2019)   6.35% (Libor + 4.75%/Q)     7/26/2017     39.3     38.5 (3)(17)      
        First lien senior secured loan ($10.4 par due 12/2019)   6.35% (Libor + 4.75%/Q)     7/26/2017     10.4     10.2 (4)(17)      
        Second lien senior secured loan ($112.0 par due 6/2020)   9.94% (Libor + 8.25%/Q)     12/27/2012     112.0     107.5 (2)(17)      
                        359.3     349.8        
                                       
JDC Healthcare Management, LLC(21)   Dental services provider   First lien senior secured revolving loan ($1.5 par due 4/2022)   7.82% (Libor + 6.25%/Q)     4/10/2017     1.5     1.5 (2)(17)      
        First lien senior secured loan ($9.9 par due 4/2023)   7.82% (Libor + 6.25%/Q)     4/10/2017     9.9     9.7 (2)(17)      
        First lien senior secured loan ($19.9 par due 4/2023)   7.82% (Libor + 6.25%/Q)     4/10/2017     19.9     19.5 (4)(17)      
                        31.3     30.7        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
KBHS Acquisition, LLC (d/b/a Alita Care, LLC)(21)   Provider of behavioral health services   First lien senior secured revolving loan ($0.2 par due 3/2022)   6.43% (Libor + 5.00%/Q)     3/17/2017     0.2     0.2 (2)(17)      
        First lien senior secured revolving loan ($0.1 par due 3/2022)   6.46% (Libor + 5.00%/Q)     3/17/2017     0.1     0.1 (2)(17)      
        First lien senior secured revolving loan ($0.2 par due 3/2022)   6.50% (Libor + 5.00%/Q)     3/17/2017     0.2     0.2 (2)(17)      
        First lien senior secured revolving loan ($0.2 par due 3/2022)   6.56% (Libor + 5.00%/Q)     3/17/2017     0.2     0.2 (2)(17)      
        First lien senior secured revolving loan ($0.8 par due 3/2022)   6.57% (Libor + 5.00%/Q)     3/17/2017     0.8     0.8 (2)(17)      
        First lien senior secured revolving loan ($0.3 par due 3/2022)   8.50% (Base Rate + 4.00%/Q)     3/17/2017     0.3     0.3 (2)(17)      
                        1.8     1.8        
                                       
Key Surgical LLC(21)   Provider of sterile processing, operating room and instrument care supplies for hospitals   First lien senior secured revolving loan ($0.9 par due 6/2022)   6.35% (Libor + 4.75%/Q)     6/1/2017     0.9     0.9 (2)(17)      
        First lien senior secured loan ($18.0 par due 6/2023)   5.75% (EURIBOR + 4.75%/Q)     6/1/2017     16.9     18.0 (2)(17)      
        First lien senior secured loan ($4.4 par due 6/2023)   6.23% (Libor + 4.75%/Q)     6/1/2017     4.3     4.4 (4)(17)      
                        22.1     23.3        
                                       
MB2 Dental Solutions, LLC(21)   Dental services provider   First lien senior secured revolving loan ($1.3 par due 9/2023)   8.25% (Base Rate + 3.75%/Q)     9/29/2017     1.3     1.3 (2)(17)      
        First lien senior secured loan ($4.7 par due 9/2023)   6.44% (Libor + 4.75%/Q)     9/29/2017     4.7     4.7 (2)(17)      
                        6.0     6.0        
                                       
MCH Holdings, Inc. and MC Acquisition Holdings I, LLC   Healthcare professional provider   First lien senior secured loan ($65.3 par due 1/2020)   6.96% (Libor + 5.50%/Q)     7/26/2017     65.3     64.6 (2)(17)      
        First lien senior secured loan ($79.0 par due 1/2020)   7.07% (Libor + 5.50%/Q)     7/26/2017     79.0     78.3 (2)(17)      
        First lien senior secured loan ($9.0 par due 1/2020)   6.96% (Libor + 5.50%/Q)     7/26/2017     9.0     9.0 (4)(17)      
        First lien senior secured loan ($11.0 par due 1/2020)   7.07% (Libor + 5.50%/Q)     7/26/2017     11.0     10.8 (4)(17)      
        Class A units (1,438,643 shares)         1/17/2014     1.5     1.0 (2)      
                        165.8     163.7        
                                       
MW Dental Holding Corp.(21)   Dental services provider   First lien senior secured revolving loan ($9.7 par due 4/2018)   9.19% (Libor + 7.50%/Q)     4/12/2011     9.7     9.7 (2)(17)      
        First lien senior secured loan ($44.4 par due 4/2018)   9.19% (Libor + 7.50%/Q)     4/12/2011     44.4     44.4 (2)(17)      
        First lien senior secured loan ($46.8 par due 4/2018)   9.19% (Libor + 7.50%/Q)     4/12/2011     46.8     46.8 (3)(17)      
        First lien senior secured loan ($19.3 par due 4/2018)   9.19% (Libor + 7.50%/Q)     4/12/2011     19.3     19.3 (4)(17)      
                        120.2     120.2        
                                       
My Health Direct, Inc.   Healthcare scheduling exchange software solution provider   Warrant to purchase up to 4,548 shares of Series D preferred stock (expires 9/2024)         9/18/2014         (2)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
New Trident Holdcorp, Inc. and Trident Holding Company, LLC   Outsourced mobile diagnostic healthcare service provider   First lien senior secured loan ($19.9 par due 7/2019)   7.44% (Libor + 5.75%/Q)     8/1/2013     15.9     16.0 (2)(17)      
        Second lien senior secured loan ($80.0 par due 7/2020)       8/1/2013     79.3     44.2 (2)(14)(16)      
        Senior subordinated loan ($8.9 par due 7/2020)       11/29/2017     8.8     (2)(16)      
                        104.0     60.2        
                                       
NMSC Holdings, Inc. and ASP NAPA Holdings, LLC   Anesthesia management services provider   Second lien senior secured loan ($72.8 par due 10/2023)   11.69% (Libor + 10.00%/Q)     4/19/2016     72.8     67.0 (2)(17)      
        Class A units (25,277 units)         4/19/2016     2.5     1.3 (2)      
                        75.3     68.3        
                                       
Nodality, Inc.   Biotechnology company   First lien senior secured loan ($2.3 par due 8/2016)       11/12/2015     2.1     (2)(16)      
        First lien senior secured loan ($10.9 par due 8/2016)       4/25/2014     9.7     (2)(16)      
        Warrant to purchase up to 3,736,255 shares of common stock (expires 3/2026)         5/1/2016         (2)      
                        11.8            
                                       
nThrive, Inc. (fka Precyse Acquisition Corp.)   Provider of healthcare information management technology and services   Second lien senior secured loan ($10.0 par due 4/2023)   11.32% (Libor + 9.75%/Q)     4/20/2016     9.7     10.0 (2)(17)      
                                       
OmniSYS Acquisition Corporation, OmniSYS, LLC, and OSYS Holdings, LLC(21)   Provider of technology-enabled solutions to pharmacies   First lien senior secured loan ($5.9 par due 11/2018)   9.19% (Libor + 7.50%/Q)     11/21/2013     5.9     5.9 (4)(17)      
        Limited liability company membership interest (1.57%)         11/21/2013     1.0     0.8 (2)      
                        6.9     6.7        
                                       
Pathway Partners Vet Management Company LLC(21)   Owner and operator of veterinary hospitals   First lien senior secured loan ($0.3 par due 10/2024)   6.07% (Libor + 4.50%/Q)     10/4/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($6.0 par due 10/2024)   6.07% (Libor + 4.50%/Q)     10/4/2017     6.0     6.0 (2)(17)      
                        6.3     6.3        
                                       
Patterson Medical Supply, Inc.   Distributor of rehabilitation supplies and equipment   Second lien senior secured loan ($78.0 par due 8/2023)   9.98% (Libor + 8.50%/Q)     9/2/2015     76.4     72.5 (2)(17)      
                                       
PhyMED Management LLC   Provider of anesthesia services   Second lien senior secured loan ($47.2 par due 5/2021)   10.21% (Libor + 8.75%/Q)     12/18/2015     46.8     45.3 (2)(17)      
                                       
Practice Insight, LLC(21)   Revenue cycle management provider to the emergency healthcare industry   First lien senior secured revolving loan ($0.6 par due 8/2022)   8.50% (Base Rate + 4.00%/Q)     8/23/2017     0.6     0.6 (2)(17)      
        First lien senior secured loan ($12.7 par due 8/2022)   6.48% (Libor + 5.00%/Q)     8/23/2017     12.7     12.7 (2)(17)      
                        13.3     13.3        
                                       
Respicardia, Inc.   Developer of implantable therapies to improve cardiovascular health   Warrant to purchase up to 99,094 shares of Series C preferred stock (expires 6/2022)         6/28/2012         (2)      
                                       
Sarnova HC, LLC, Tri-Anim Health Services, Inc., and BEMS Holdings, LLC   Distributor of emergency medical service and respiratory products   Second lien senior secured loan ($54.0 par due 7/2022)   11.07% (Libor + 9.50%/Q)     1/29/2016     54.0     54.0 (2)(17)      
                                       
TerSera Therapeutics LLC   Acquirer and developer of specialty therapeutic pharmaceutical products   First lien senior secured loan ($5.3 par due 3/2023)   6.94% (Libor + 5.25%/Q)     5/3/2017     5.2     5.3 (4)(17)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Transaction Data Systems, Inc.   Pharmacy management software provider   Second lien senior secured loan ($35.3 par due 6/2022)   10.35% (Libor + 9.00%/Q)     6/15/2015     35.3     35.3 (2)(17)      
        Second lien senior secured loan ($3.8 par due 6/2022)   10.35% (Libor + 9.00%/Q)     12/19/2017     3.8     3.8 (2)(17)      
                        39.1     39.1        
                                       
U.S. Anesthesia Partners, Inc.   Anesthesiology service provider   Second lien senior secured loan ($71.8 par due 6/2025)   8.82% (Libor + 7.25%/Q)     6/16/2017     70.8     71.8 (2)(17)      
                                       
Urgent Cares of America Holdings I, LLC and FastMed Holdings I, LLC(21)   Operator of urgent care clinics   Preferred units (7,696,613 units)         6/11/2015     7.7     0.5        
        Series A common units (2,000,000 units)         6/11/2015     2.0            
        Series C common units (5,288,427 units)         6/11/2015                
                        9.7     0.5        
                                       
VistaPharm, Inc. and Vertice Pharma UK Parent Limited(21)   Manufacturer and distributor of generic pharmaceutical products   First lien senior secured loan ($7.8 par due 12/2021)   7.86% (Libor + 6.00%/Q)     11/6/2017     7.8     7.7 (2)(17)      
        Preferred shares (40,662 shares)         12/21/2015     0.3     0.5 (9)      
                        8.1     8.2        
                        2,622.8     2,668.6     37.60 %
Business Services                                      
Accruent, LLC, Accruent Holding, LLC and Athena Parent, Inc.(21)   Real estate and facilities management software provider   First lien senior secured revolving loan ($0.7 par due 7/2023)   6.36% (Libor + 4.75%/Q)     7/28/2017     0.7     0.7 (2)(17)      
        Second lien senior secured loan ($13.2 par due 7/2024)   10.13% (Libor + 8.75%/Q)     7/28/2017     13.2     13.2 (2)(17)      
        Second lien senior secured loan ($0.5 par due 7/2024)   10.36% (Libor + 8.75%/Q)     7/28/2017     0.5     0.5 (2)(17)      
        Second lien senior secured loan ($2.6 par due 7/2024)   10.16% (Libor + 8.75%/Q)     7/28/2017     2.6     2.6 (2)(17)      
        Second lien senior secured loan ($58.4 par due 7/2024)   10.13% (Libor + 8.75%/Q)     7/28/2017     58.4     58.4 (2)(17)      
        Senior subordinated loan ($21.2 par due 7/2025)   11.50% PIK     7/28/2017     21.2     20.4 (2)      
        Senior subordinated loan ($75.7 par due 7/2025)   11.50% PIK     7/28/2017     75.7     72.8 (2)      
        Common stock (3,464 shares)         5/16/2016     3.6     2.7 (2)      
        Warrant to purchase up to 11,380 shares of common stock (expires 7/2037)         7/28/2017         3.3 (2)      
                        175.9     174.6        
                                       
Achilles Acquisition LLC(21)   Benefits broker and outsourced workflow automation platform provider for brokers   First lien senior secured loan ($3.0 par due 6/2023)   7.69% (Libor + 6.00%/Q)     6/6/2017     3.0     3.0 (2)(17)      
        First lien senior secured loan ($10.2 par due 6/2023)   7.69% (Libor + 6.00%/Q)     6/6/2017     10.2     10.2 (4)(17)      
                        13.2     13.2        
                                       
Acrisure, LLC, Acrisure Investors FO, LLC and Acrisure Investors SO, LLC   Retail insurance advisor and brokerage   Membership interests (10,793,504 units)         11/18/2016     10.8     10.8 (2)      
        Membership interests (2,698,376 units)         11/18/2016     2.7     2.7 (2)      
                        13.5     13.5        
                                       
BeyondTrust Software, Inc.   Management software solutions provider   First lien senior secured loan ($46.2 par due 11/2023)   7.89% (Libor + 6.25%/Q)     11/21/2017     45.5     45.7 (3)(17)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Brandtone Holdings Limited(9)   Mobile communications and marketing services provider   First lien senior secured loan ($4.7 par due 11/2018)       5/11/2015     4.5     (2)(16)      
        First lien senior secured loan ($3.1 par due 2/2019)       5/11/2015     2.9     (2)(16)      
        Warrant to purchase up to 184,003 units of convertible preferred shares (expires 8/2026)         5/11/2015         (2)      
                        7.4            
                                       
CallMiner, Inc.   Provider of cloud-based conversational analytics solutions   Warrant to purchase up to 2,350,636 shares of Series 1 preferred stock (expires 7/2024)         7/23/2014         (2)      
                                       
Chesapeake Research Review, LLC and Schulman Associates Institutional Review Board, Inc.(21)   Provider of central institutional review boards over clinical trials   First lien senior secured revolving loan ($0.6 par due 11/2023)   7.14% (Libor + 5.75%/Q)     11/7/2017     0.6     0.6 (2)(17)      
        First lien senior secured loan ($30.8 par due 11/2023)   7.14% (Libor + 5.75%/Q)     11/7/2017     30.8     30.5 (2)(17)      
                        31.4     31.1        
                                       
Clearwater Analytics, LLC(21)   Provider of integrated cloud-based investment portfolio management, accounting, reporting and analytics software   First lien senior secured revolving loan ($0.4 par due 9/2022)   9.00% (Libor + 7.50%/Q)     9/1/2016     0.4     0.4 (2)(17)      
                                       
CMW Parent LLC (fka Black Arrow, Inc.)   Multiplatform media firm   Series A units (32 units)         9/11/2015         (2)      
                                       
Columbo Midco Limited, Columbo Bidco Limited and Columbo Topco Limited(8)(9)   Compliance, accounting and tax consulting services provider   Preferred stock (34,028,135 shares)         1/3/2017     2.3     9.9        
        Preferred stock (17,653,253 shares)         1/3/2017     21.6     26.0        
        Preferred stock (3,232,666 shares)         1/3/2017     4.0     4.7        
                        27.9     40.6        
                                       
Command Alkon Incorporated(21)   Software solutions provider to the ready-mix concrete industry   First lien senior secured revolving loan ($1.5 par due 9/2022)   8.50% (Base Rate + 4.00%/Q)     9/1/2017     1.5     1.5 (2)(17)(20)      
        First lien senior secured loan ($25.6 par due 9/2023)   6.48% (Libor + 5.00%/Q)     9/1/2017     25.6     25.3 (2)(17)      
        Second lien senior secured loan ($33.8 par due 3/2024)   10.48% (Libor + 9.00%/Q)     9/1/2017     33.8     33.4 (2)(17)      
                        60.9     60.2        
                                       
Compusearch Software Systems, Inc.   Provider of enterprise software and services for organizations in the public sector   Second lien senior secured loan ($51.0 par due 11/2021)   10.16% (Libor + 8.75%/Q)     1/3/2017     51.0     51.0 (2)(17)      
                                       
Compuware Parent, LLC   Web and mobile cloud performance testing and monitoring services provider   Class A-1 common stock (4,132 units)         12/15/2014     2.2     2.2 (2)      
        Class B-1 common stock (4,132 units)         12/15/2014     0.4     0.4 (2)      
        Class C-1 common stock (4,132 units)         12/15/2014     0.3     0.3 (2)      
        Class A-2 common stock (4,132 units)         12/15/2014         (2)      
        Class B-2 common stock (4,132 units)         12/15/2014         (2)      
        Class C-2 common stock (4,132 units)         12/15/2014         (2)      
                        2.9     2.9        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Convergint Technologies LLC   Integrated services provider for security, fire and life safety   Second lien senior secured loan ($25.0 par due 12/2020)   10.27% (Libor + 8.50%/Q)     12/18/2017     25.0     25.0 (2)(17)      
        Second lien senior secured loan ($3.0 par due 12/2020)   10.12% (Libor + 8.50%/Q)     1/3/2017     3.0     3.0 (2)(17)      
        Second lien senior secured loan ($6.0 par due 12/2020)   9.98% (Libor + 8.50%/Q)     1/3/2017     6.0     6.0 (2)(17)      
        Second lien senior secured loan ($14.0 par due 12/2020)   10.00% (Libor + 8.50%/Q)     1/3/2017     14.0     14.0 (2)(17)      
        Second lien senior secured loan ($8.0 par due 12/2020)   10.27% (Libor + 8.50%/Q)     1/3/2017     8.0     8.0 (2)(17)      
        Second lien senior secured loan ($8.0 par due 12/2020)   9.45% (Libor + 8.00%/Q)     1/3/2017     8.0     8.0 (2)(17)      
        Second lien senior secured loan ($11.0 par due 12/2020)   9.50% (Libor + 8.00%/Q)     1/3/2017     11.0     11.0 (2)(17)      
        Second lien senior secured loan ($75.0 par due 12/2020)   9.61% (Libor + 8.00%/Q)     1/3/2017     75.0     75.0 (2)(17)      
                        150.0     150.0        
                                       
Directworks, Inc. and Co-Exprise Holdings, Inc.   Provider of cloud-based software solutions for direct materials sourcing and supplier management for manufacturers   First lien senior secured loan ($1.8 par due 4/2018)       12/19/2014     1.3     0.2 (2)(16)      
        Warrant to purchase up to 1,875,000 shares of Series 1 preferred stock (expires 12/2024)         12/19/2014         (2)      
                        1.3     0.2        
                                       
DRB Holdings, LLC(21)   Provider of integrated technology solutions to car wash operators   First lien senior secured loan ($36.7 par due 10/2023)   7.10% (Libor + 5.75%/Q)     10/6/2017     36.7     36.3 (2)(17)      
                                       
DTI Holdco, Inc. and OPE DTI Holdings, Inc.(21)   Provider of legal process outsourcing and managed services   First lien senior secured loan ($4.1 par due 10/2023)   6.63% (Libor + 5.25%/Q)     9/23/2016     4.1     4.1 (4)(17)      
        Class A common stock (7,500 shares)         8/19/2014     7.5     6.9 (2)      
        Class B common stock (7,500 shares)         8/19/2014         (2)      
                        11.6     11.0        
                                       
Emergency Communications Network, LLC(21)   Provider of mission critical emergency mass notification solutions   First lien senior secured loan ($37.9 par due 6/2023)   7.82% (Libor + 6.25%/Q)     6/1/2017     37.7     37.5 (2)(17)      
        First lien senior secured loan ($19.9 par due 6/2023)   7.82% (Libor + 6.25%/Q)     6/1/2017     19.8     19.8 (4)(17)      
                        57.5     57.3        
                                       
EN Engineering, L.L.C.(21)   National utility services firm providing engineering and consulting services to natural gas, electric power and other energy and industrial end markets   First lien senior secured revolving loan       6/30/2015         (19)      
                                       
Entertainment Partners, LLC and Entertainment Partners Canada Inc.(21)   Provider of entertainment workforce and production management solutions   First lien senior secured loan ($7.9 par due 5/2022)   6.85% (Libor + 5.50%/Q)     5/8/2017     7.3     7.9 (2)(9)(17)      
        First lien senior secured loan ($4.2 par due 5/2023)   7.15% (Libor + 5.75%/Q)     5/8/2017     4.2     4.1 (2)(17)      
        First lien senior secured loan ($26.1 par due 5/2023)   7.15% (Libor + 5.75%/Q)     5/8/2017     26.1     25.8 (3)(17)      
        First lien senior secured loan ($3.6 par due 5/2023)   7.44% (Libor + 5.75%/Q)     5/8/2017     3.6     3.6 (2)(17)      
        First lien senior secured loan ($22.5 par due 5/2023)   7.44% (Libor + 5.75%/Q)     5/8/2017     22.5     22.2 (3)(17)      
        First lien senior secured loan ($4.2 par due 5/2023)   7.34% (Libor + 5.75%/Q)     5/8/2017     4.2     4.1 (2)(17)      
        First lien senior secured loan ($26.1 par due 5/2023)   7.34% (Libor + 5.75%/Q)     5/8/2017     26.1     25.8 (3)(17)      
                        94.0     93.5        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
First Insight, Inc.   Software company providing merchandising and pricing solutions to companies worldwide   Warrant to purchase up to 122,827 units of Series C preferred stock (expires 3/2024)         3/20/2014         (2)      
                                       
Flexera Software LLC   Provider of software and software applications that manages application usage, compliance and security risk   Second lien senior secured loan ($5.0 par due 4/2021)   8.57% (Libor + 7.00%/Q)     1/3/2017     4.8     5.0 (2)(17)      
                                       
Foundation Risk Partners, Corp.(21)   Full service independent insurance agency   First lien senior secured loan ($23.5 par due 11/2023)   6.16% (Libor + 4.75%/Q)     11/10/2017     23.5     23.3 (3)(17)      
        Second lien senior secured loan ($27.5 par due 11/2024)   9.91% (Libor + 8.50%/Q)     11/10/2017     27.5     27.2 (2)(17)      
                        51.0     50.5        
                                       
Graphpad Software, LLC(21)   Provider of data analysis, statistics, and visualization software solutions for scientific research applications   First lien senior secured revolving loan ($0.6 par due 12/2023)   7.66% (Libor + 6.00%/Q)     12/21/2017     0.6     0.6 (2)(17)      
        First lien senior secured loan ($8.8 par due 12/2023)   7.66% (Libor + 6.00%/Q)     12/21/2017     8.8     8.7 (2)(17)      
                        9.4     9.3        
                                       
GTCR-Ultra Acquisition, Inc. and GTCR-Ultra Holdings, LLC(21)   Provider of payment processing and merchant acquiring solutions   First lien senior secured loan ($8.9 par due 8/2024)   7.37% (Libor + 6.00%/Q)     8/1/2017     8.9     8.9 (4)(17)      
        Class A-2 units (911 units)         8/1/2017     0.9     1.0 (2)      
        Class B units (2,878,372 units)         8/1/2017         (2)      
                        9.8     9.9        
                                       
HAI Acquisition Corporation and Aloha Topco, LLC(21)   Professional employer organization provider of human resources, compliance and risk management services   First lien senior secured revolving loan ($4.7 par due 11/2023)   7.38% (Libor + 6.00%/Q)     11/1/2017     4.7     4.7 (2)(17)      
        First lien senior secured loan ($81.4 par due 11/2024)   9.50% (Base Rate + 5.00%/Q)     11/1/2017     81.4     80.6 (2)(17)      
        Class A units (16,980 units)         11/1/2017     1.7     1.7 (2)      
                        87.8     87.0        
                                       
IfByPhone Inc.   Voice-based marketing automation software provider   Warrant to purchase up to 124,300 shares of Series C preferred stock (expires 10/2022)         10/15/2012     0.1     0.1 (2)      
                                       
Implementation Management Assistance, LLC(21)   Revenue cycle consulting firm to the healthcare industry   First lien senior secured loan ($8.0 par due 12/2023)   5.46% (Libor + 4.00%/Q)     12/13/2017     8.0     7.9 (2)(17)      
                                       
Infogix, Inc. and Infogix Parent Corporation   Enterprise data analytics and integrity software solutions provider   First lien senior secured loan ($51.6 par due 12/2021)   8.44% (Libor + 6.75%/Q)     1/3/2017     51.6     51.6 (2)(12)(17)      
        First lien senior secured loan ($34.9 par due 12/2021)   8.44% (Libor + 6.75%/Q)     1/3/2017     34.9     34.9 (3)(12)(17)      
        Series A preferred stock (2,475 shares)         1/3/2017     2.5     2.9        
        Common stock (1,297,768 shares)         1/3/2017         0.3        
                        89.0     89.7        
                                       
Inmar, Inc.   Technology-driven solutions provider for retailers, wholesalers and manufacturers   Second lien senior secured loan ($28.3 par due 5/2025)   9.42% (Libor + 8.00%/Q)     4/25/2017     27.9     28.3 (2)(17)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
InterVision Systems, LLC and InterVision Holdings, LLC   Provider of cloud based IT solutions, infrastructure and services   First lien senior secured loan ($24.7 par due 5/2022)   9.79% (Libor + 7.95%/Q)     5/31/2017     24.7     24.7 (2)(17)      
        First lien senior secured loan ($10.0 par due 5/2022)   9.79% (Libor + 7.95%/Q)     5/31/2017     10.0     10.0 (4)(17)      
        Class A membership units (1,000 units)         5/31/2017     1.0     1.4        
                        35.7     36.1        
                                       
iParadigms Holdings, LLC   Anti-plagiarism software provider to the education market   Second lien senior secured loan ($37.5 par due 7/2022)   8.94% (Libor + 7.25%/Q)     1/3/2017     36.8     36.7 (2)(17)      
                                       
iPipeline, Inc., Internet Pipeline, Inc., iPipeline Limited and iPipeline Holdings, Inc.(21)   Provider of SaaS-based software solutions to the insurance and financial services industry   First lien senior secured loan ($7.5 par due 8/2022)   7.74% (Libor + 6.25%/Q)     6/15/2017     7.4     7.5 (2)(17)      
        First lien senior secured loan ($9.1 par due 8/2022)   7.74% (Libor + 6.25%/Q)     9/15/2017     9.1     9.1 (2)(17)      
        First lien senior secured loan ($46.4 par due 8/2022)   8.60% (Libor + 7.25%/Q)     8/4/2015     46.4     46.4 (3)(17)      
        First lien senior secured loan ($14.7 par due 8/2022)   8.60% (Libor + 7.25%/Q)     8/4/2015     14.7     14.7 (4)(17)      
        First lien senior secured loan ($12.2 par due 8/2022)   8.07% (Libor + 6.50%/Q)     12/18/2017     12.0     12.2 (2)(9)(17)      
        Preferred stock (1,100 shares)         8/4/2015     1.1     3.5 (2)      
        Common stock (668,781 shares)         8/4/2015         (2)      
                        90.7     93.4        
                                       
IQMS   Provider of enterprise resource planning and manufacturing execution software for small and midsized manufacturers   First lien senior secured loan ($4.0 par due 3/2022)   9.82% (Libor + 8.25%/Q)     3/28/2017     4.0     4.0 (2)(17)      
        First lien senior secured loan ($18.8 par due 3/2022)   9.82% (Libor + 8.25%/Q)     3/28/2017     18.8     18.8 (3)(17)      
        First lien senior secured loan ($15.0 par due 3/2022)   9.82% (Libor + 8.25%/Q)     3/28/2017     15.0     15.0 (4)(17)      
                        37.8     37.8        
                                       
Iron Bow Technologies, LLC   Provider and value added reseller of information technology products and solutions   Second lien senior secured loan ($10.0 par due 2/2021)   13.11% (Libor + 10.00% Cash, 1.75% PIK/Q)     1/3/2017     10.0     10.0 (2)(17)      
                                       
IronPlanet, Inc.   Online auction platform provider for used heavy equipment   Warrant to purchase to up to 133,333 shares of Series C preferred stock (expires 9/2023)         9/23/2013     0.2     0.4 (2)      
                                       
LLSC Holdings Corporation (dba Lawrence Merchandising Services)(8)   Marketing services provider   Series A preferred stock (9,000 shares)         1/3/2017     19.2     18.2        
        Common stock (1,000 shares)         1/3/2017                
                        19.2     18.2        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Miles 33 (Finance) Limited(8)(9)   Software provider to the regional media industry and magazines   First lien senior secured loan ($0.4 par due 9/2018)   7.00% (EURIBOR + 3.50% Cash, 3.00% PIK/Q)     1/3/2017     0.3     0.4        
        First lien senior secured loan ($4.1 par due 9/2018)   7.00% (EURIBOR + 3.50% Cash, 3.00% PIK/Q)     1/3/2017     3.7     4.1        
        Senior subordinated loan ($17.4 par due 9/2021)   5.00% (EURIBOR + 4.50%/Q)     1/3/2017     9.9     13.4        
        Preferred stock (19,500,000 shares)         1/3/2017                
        Preferred stock (900,000 shares)         1/3/2017                
        Common stock (600,000 shares)         1/3/2017                
                        13.9     17.9        
                                       
Ministry Brands, LLC and MB Parent HoldCo, L.P.(21)   Software and payment services provider to faith-based institutions   First lien senior secured revolving loan ($10.9 par due 12/2022)   6.57% (Libor + 5.00%/Q)     12/2/2016     10.9     10.9 (2)(17)      
        First lien senior secured loan ($1.7 par due 12/2022)   6.57% (Libor + 5.00%/Q)     8/22/2017     1.7     1.7 (2)(17)      
        First lien senior secured loan ($1.4 par due 12/2022)   6.38% (Libor + 5.00%/Q)     8/22/2017     1.4     1.4 (2)(17)      
        First lien senior secured loan ($10.6 par due 12/2022)   6.38% (Libor + 5.00%/Q)     4/6/2017     10.6     10.6 (2)(17)      
        First lien senior secured loan ($16.7 par due 12/2022)   6.38% (Libor + 5.00%/Q)     4/6/2017     16.5     16.7 (2)(17)      
        Second lien senior secured loan ($4.6 par due 6/2023)   10.82% (Libor + 9.25%/Q)     8/22/2017     4.6     4.6 (2)(17)      
        Second lien senior secured loan ($1.6 par due 6/2023)   10.60% (Libor + 9.25%/Q)     8/22/2017     1.6     1.6 (2)(17)      
        Second lien senior secured loan ($5.1 par due 6/2023)   10.63% (Libor + 9.25%/Q)     8/22/2017     5.1     5.1 (2)(17)      
        Second lien senior secured loan ($16.6 par due 6/2023)   10.63% (Libor + 9.25%/Q)     12/2/2016     16.6     16.6 (2)(17)      
        Second lien senior secured loan ($4.7 par due 6/2023)   10.63% (Libor + 9.25%/Q)     4/6/2017     4.7     4.7 (2)(17)      
        Second lien senior secured loan ($9.2 par due 6/2023)   10.63% (Libor + 9.25%/Q)     4/6/2017     9.2     9.2 (2)(17)      
        Second lien senior secured loan ($90.0 par due 6/2023)   10.63% (Libor + 9.25%/Q)     12/2/2016     89.3     90.0 (2)(17)      
        Class A units (500,000 units)         12/2/2016     5.0     6.8 (2)      
                        177.2     179.9        
                                       
MVL Group, Inc.(8)   Marketing research provider   Common stock (560,716 shares)         4/1/2010         (2)      
                                       
NAS, LLC, Nationwide Marketing Group, LLC and Nationwide Administrative Services, Inc.   Buying and marketing services organization for appliance, furniture and consumer electronics dealers   Second lien senior secured loan ($24.1 par due 12/2021)   10.32% (Libor + 9.00%/Q)     6/1/2015     24.1     24.1 (2)(17)      
                                       
Novetta Solutions, LLC   Provider of advanced analytics solutions for the government, defense and commercial industries   First lien senior secured loan ($12.7 par due 10/2022)   6.70% (Libor + 5.00%/Q)     1/3/2017     12.3     12.1 (2)(17)      
        Second lien senior secured loan ($31.0 par due 10/2023)   10.20% (Libor + 8.50%/Q)     1/3/2017     28.4     27.9 (2)(17)      
                        40.7     40.0        
                                       
Palermo Finance Corporation(21)   Provider of mission-critical integrated public safety software and services to local, state and federal agencies   First lien senior secured revolving loan       4/17/2017         (19)      
        First lien senior secured loan ($11.0 par due 4/2023)   5.85% (Libor + 4.50%/Q)     4/17/2017     10.9     11.0 (4)(17)      
        Second lien senior secured loan ($54.3 par due 10/2023)   9.85% (Libor + 8.50%/Q)     4/17/2017     54.3     54.3 (2)(17)      
                        65.2     65.3        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Park Place Technologies, LLC   Provider of third party hardware maintenance and support services for IT data centers   Second lien senior secured loan ($41.5 par due 12/2022)   10.54% (Libor + 9.00%/Q)     1/3/2017     41.5     41.5 (2)(17)      
                                       
PayNearMe, Inc.   Electronic cash payment system provider   Warrant to purchase up to 195,726 shares of Series E preferred stock (expires 3/2023)         3/11/2016     0.2     (5)      
                                       
PDI TA Holdings, Inc.(21)   Provider of enterprise management software for the convenience retail and petroleum wholesale markets   First lien senior secured revolving loan ($0.9 par due 8/2023)   8.25% (Base Rate + 3.75%/Q)     8/25/2017     0.9     0.9 (2)(17)      
        First lien senior secured loan ($3.7 par due 8/2023)   6.32% (Libor + 4.75%/Q)     8/25/2017     3.7     3.7 (2)(17)      
        First lien senior secured loan ($26.4 par due 8/2023)   6.21% (Libor + 4.75%/Q)     8/25/2017     26.4     26.1 (2)(17)      
        Second lien senior secured loan ($8.2 par due 8/2024)   10.32% (Libor + 8.75%/Q)     8/25/2017     8.2     8.1 (2)(17)      
        Second lien senior secured loan ($66.8 par due 8/2024)   10.21% (Libor + 8.75%/Q)     8/25/2017     66.8     66.1 (2)(17)      
                        106.0     104.9        
                                       
PHL Investors, Inc., and PHL Holding Co.(8)   Mortgage services   Class A common stock (576 shares)         7/31/2012     3.8     (2)      
                                       
PHNTM Holdings, Inc. and Planview Parent, Inc.   Provider of project and portfolio management software   First lien senior secured loan ($5.1 par due 1/2023)   6.82% (Libor + 5.25%/Q)     12/7/2017     5.1     5.1 (2)(17)      
        First lien senior secured loan ($31.6 par due 1/2023)   6.82% (Libor + 5.25%/Q)     1/27/2017     31.1     31.6 (2)(17)      
        First lien senior secured loan ($5.0 par due 1/2023)   6.82% (Libor + 5.25%/Q)     1/27/2017     4.9     5.0 (4)(17)      
        Second lien senior secured loan ($62.0 par due 7/2023)   11.32% (Libor + 9.75%/Q)     1/27/2017     61.2     62.0 (2)(17)      
        Class A common shares (990 shares)         1/27/2017     1.0     1.1 (2)      
        Class B common shares (168,329 shares)         1/27/2017         0.2 (2)      
                        103.3     105.0        
                                       
Poplicus Incorporated   Business intelligence and market analytics platform for companies that sell to the public sector   Warrant to purchase up to 2,402,991 shares of Series C preferred stock (expires 6/2025)         6/25/2015     0.1     (5)      
                                       
PowerPlan, Inc. and Project Torque Ultimate Parent Corporation   Fixed asset financial management software provider   Second lien senior secured loan ($30.0 par due 2/2023)   10.57% (Libor + 9.00%/Q)     2/23/2015     29.8     30.0 (2)(17)      
        Second lien senior secured loan ($50.0 par due 2/2023)   10.57% (Libor + 9.00%/Q)     2/23/2015     49.7     50.0 (3)(17)      
        Class A common stock (1,697 shares)         2/23/2015     1.7     3.3 (2)      
        Class B common stock (989,011 shares)         2/23/2015         (2)      
                        81.2     83.3        
                                       
Project Alpha Intermediate Holding, Inc. and Qlik Parent, Inc.   Provider of data visualization software for data analytics   Class A common shares (7,444 shares)         8/22/2016     7.4     7.6 (2)      
        Class B common shares (1,841,608.69 shares)         8/22/2016     0.1     (2)      
                        7.5     7.6        
                                       
R2 Acquisition Corp.   Marketing services   Common stock (250,000 shares)         5/29/2007     0.2     0.3 (2)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
SCM Insurance Services Inc.(9)(21)   Provider of claims management, claims investigation & support and risk management solutions for the Canadian property and casualty insurance industry   First lien senior secured loan ($21.5 par due 8/2024)   6.35% (Libor + 5.00%/Q)     8/29/2017     21.5     21.2 (2)(17)      
        Second lien senior secured loan ($60.5 par due 3/2025)   10.35% (Libor + 9.00%/Q)     8/29/2017     60.5     59.9 (2)(17)      
                        82.0     81.1        
                                       
Shift PPC LLC(21)   Digital solutions provider   First lien senior secured loan ($1.7 par due 12/2021)   7.57% (Libor + 6.00%/Q)     12/22/2016     1.7     1.7 (4)(17)      
        First lien senior secured loan ($3.3 par due 12/2021)   7.69% (Libor + 6.00%/Q)     12/22/2016     3.3     3.3 (4)(17)      
        First lien senior secured loan ($5.0 par due 12/2021)   7.84% (Libor + 6.00%/Q)     12/22/2016     5.0     5.0 (4)(17)      
                        10.0     10.0        
                                       
Sparta Systems, Inc., Project Silverback Holdings Corp. and Silverback Holdings, Inc.(21)   Quality management software provider   Second lien senior secured loan ($20.0 par due 8/2025)   9.69% (Libor + 8.25%/Q)     8/21/2017     19.6     19.8 (2)(17)      
        Series B preferred shares (10,084 shares)         8/21/2017     1.1     1.1        
                        20.7     20.9        
                                       
Talari Networks, Inc.   Networking equipment provider   First lien senior secured loan ($6.0 par due 10/2019)   10.88% (Libor + 9.50%/M)     8/3/2015     6.0     5.7 (5)(17)      
        Warrant to purchase up to 421,052 shares of Series D-1 preferred stock (expires 8/2022)         8/3/2015     0.1     0.1 (5)      
                        6.1     5.8        
                                       
The Gordian Group, Inc.(21)   Construction software and service provider   First lien senior secured loan ($8.4 par due 7/2019)   6.14% (Libor + 4.50%/Q)     1/3/2017     8.3     8.4 (3)(17)      
        First lien senior secured loan ($3.2 par due 7/2019)   6.14% (Libor + 4.50%/Q)     1/3/2017     3.1     3.2 (4)(17)      
        First lien senior secured loan ($8.9 par due 7/2019)   5.86% (Libor + 4.50%/Q)     1/3/2017     8.8     8.9 (3)(17)      
        First lien senior secured loan ($3.4 par due 7/2019)   5.86% (Libor + 4.50%/Q)     1/3/2017     3.3     3.4 (4)(17)      
        First lien senior secured loan ($7.8 par due 7/2019)   5.95% (Libor + 4.50%/Q)     1/3/2017     7.6     7.8 (3)(17)      
        First lien senior secured loan ($2.9 par due 7/2019)   5.95% (Libor + 4.50%/Q)     1/3/2017     2.9     2.9 (4)(17)      
                        34.0     34.6        
                                       
The Greeley Company, Inc. and HCP Acquisition Holdings, LLC(8)   Healthcare compliance advisory services   Senior subordinated loan ($10.5 par due 3/2017)         3/5/2013         (2)(16)      
        Class A units (14,293,110 units)         6/26/2008         (2)      
                                   

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
UL Holding Co., LLC(7)   Provider of collection and landfill avoidance solutions for food waste and unsold food products   Senior subordinated loan ($2.8 par due 5/2020)   10.00% PIK     4/30/2012     0.9     2.8 (2)      
        Senior subordinated loan ($0.4 par due 5/2020)         4/30/2012     0.1     0.4 (2)      
        Senior subordinated loan ($6.2 par due 5/2020)   10.00% PIK     4/30/2012     1.9     6.2 (2)      
        Senior subordinated loan ($0.5 par due 5/2020)         4/30/2012     0.2     0.5 (2)      
        Senior subordinated loan ($24.5 par due 5/2020)   10.00% PIK     4/30/2012     7.6     24.5 (2)      
        Senior subordinated loan ($3.8 par due 5/2020)         4/30/2012     1.2     3.8 (2)      
        Class A common units (533,351 units)         6/17/2011     5.0     2.8 (2)      
        Class B-5 common units (272,834 units)         6/17/2011     2.5     1.4 (2)      
        Class C common units (758,546 units)         4/25/2008         (2)      
        Warrant to purchase up to 719,044 shares of Class A units         5/2/2014         (2)      
        Warrant to purchase up to 28,663 shares of Class B-1 units         5/2/2014         (2)      
        Warrant to purchase up to 57,325 shares of Class B-2 units         5/2/2014         (2)      
        Warrant to purchase up to 29,645 shares of Class B-3 units         5/2/2014         (2)      
        Warrant to purchase up to 80,371 shares of Class B-5 units         5/2/2014         (2)      
        Warrant to purchase up to 59,655 shares of Class B-6 units         5/2/2014         (2)      
        Warrant to purchase up to 1,046,713 shares of Class C units         5/2/2014         (2)      
                        19.4     42.4        
                                       
Velocity Holdings Corp.   Hosted enterprise resource planning application management services provider   Common units (1,713,546 units)         12/13/2013     4.5     3.4        
                                       
Visual Edge Technology, Inc.   Provider of outsourced office solutions with a focus on printer and copier equipment and other parts and supplies   First lien senior secured loan ($1.2 par due 8/2022)   7.32% (Libor + 5.75%/Q)     8/31/2017     1.2     1.2 (2)(17)      
        First lien senior secured loan ($3.8 par due 8/2022)   7.13% (Libor + 5.75%/Q)     8/31/2017     3.8     3.8 (2)(17)      
        First lien senior secured loan ($10.0 par due 8/2022)   7.23% (Libor + 5.75%/Q)     8/31/2017     10.0     10.0 (2)(17)      
        Senior subordinated loan ($41.5 par due 9/2024)   12.50% PIK     8/31/2017     37.6     39.0 (2)      
        Warrant to purchase up to 1,816,089 shares of common stock (expires 8/2027)         8/31/2017         0.9 (2)      
        Warrant to purchase up to 2,070,511 shares of preferred stock (expires 8/2027)         8/31/2017     4.1     4.4 (2)      
                        56.7     59.3        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
VRC Companies, LLC(21)   Provider of records and information management services   First lien senior secured revolving loan ($0.8 par due 3/2022)   10.00% (Base Rate + 5.50%/Q)     4/17/2017     0.8     0.8 (2)(17)      
        First lien senior secured loan ($1.4 par due 3/2023)   7.82% (Libor + 6.50%/Q)     4/17/2017     1.4     1.4 (2)(17)      
        First lien senior secured loan ($0.2 par due 3/2023)   8.03% (Libor + 6.50%/Q)     4/17/2017     0.2     0.2 (2)(17)      
        First lien senior secured loan ($0.4 par due 3/2023)   7.93% (Libor + 6.50%/Q)     10/3/2017     0.4     0.4 (2)(17)      
        First lien senior secured loan ($0.3 par due 3/2023)   7.98% (Libor + 6.50%/Q)     10/3/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($0.3 par due 3/2023)   8.03% (Libor + 6.50%/Q)     10/3/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($5.5 par due 3/2023)   8.12% (Libor + 6.50%/Q)     4/17/2017     5.5     5.5 (2)(17)      
                        8.9     8.9        
                                       
WorldPay Group PLC(9)   Payment processing company   C2 shares (73,974 shares)         10/21/2015         (24)      
                                       
Zywave, Inc.(21)   Provider of software and technology-enabled content and analytical solutions to insurance brokers   First lien senior secured revolving loan ($1.3 par due 11/2022)   6.57% (Libor + 5.00%/Q)     11/17/2016     1.3     1.3 (2)(17)      
        First lien senior secured revolving loan ($1.0 par due 11/2022)   8.50% (Base Rate + 4.00%/Q)     11/17/2016     1.0     1.0 (2)(17)      
        Second lien senior secured loan ($27.0 par due 11/2023)   10.42% (Libor + 9.00%/Q)     11/17/2016     27.0     27.0 (2)(17)      
                        29.3     29.3        
                        2,235.8     2,267.3     31.94 %
Consumer Products                                      
Badger Sportswear Acquisition, Inc.   Provider of team uniforms and athletic wear   Second lien senior secured loan ($56.8 par due 3/2024)   10.46% (Libor + 9.00%/Q)     9/6/2016     56.7     56.8 (2)(17)      
                                       
BRG Sports, Inc.   Designer, manufacturer and licensor of branded sporting goods   Preferred stock (2,009 shares)         1/3/2017                
        Common stock (6,566,655 shares)         1/3/2017         0.3        
                            0.3        
                                       
Consumer Health Parent LLC   Developer and marketer of over-the-counter cold remedy products   Preferred units (1,072 units)         12/15/2017     1.1     1.1 (2)      
        Series A units (1,072 units)         12/15/2017         (2)      
                        1.1     1.1        
                                       
Feradyne Outdoors, LLC and Bowhunter Holdings, LLC   Provider of branded archery and bowhunting accessories   Common units (421 units)         4/24/2014     4.2     1.0 (2)      
                                       
Implus Footcare, LLC   Provider of footwear and other accessories   First lien senior secured loan ($14.6 par due 4/2021)   8.44% (Libor + 6.75%/Q)     6/1/2017     14.6     14.6 (2)(17)      
        First lien senior secured loan ($77.5 par due 4/2021)   8.44% (Libor + 6.75%/Q)     6/1/2017     77.5     77.5 (2)(17)      
        First lien senior secured loan ($19.9 par due 4/2021)   8.44% (Libor + 6.75%/Q)     6/1/2017     19.9     19.9 (4)(17)      
                        112.0     112.0        
                                       
Indra Holdings Corp.   Designer, marketer, and distributor of rain and cold weather products   Second lien senior secured loan ($80.0 par due 11/2021)       5/1/2014     76.9     43.6 (2)(16)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Plantation Products, LLC, Seed Holdings, Inc. and Flora Parent, Inc.   Provider of branded lawn and garden products   Second lien senior secured loan ($2.0 par due 6/2021)   9.41% (Libor + 7.99%/Q)     12/23/2014     2.0     2.0 (2)(17)      
        Second lien senior secured loan ($54.0 par due 6/2021)   9.41% (Libor + 7.99%/Q)     12/23/2014     53.8     54.0 (3)(17)      
        Second lien senior secured loan ($10.0 par due 6/2021)   9.41% (Libor + 7.99%/Q)     12/23/2014     10.0     10.0 (4)(17)      
        Common stock (30,000 shares)         12/23/2014     3.0     6.0 (2)      
                        68.8     72.0        
                                       
Rug Doctor, LLC and RD Holdco Inc.(8)   Manufacturer and marketer of carpet cleaning machines   Second lien senior secured loan ($16.9 par due 12/2018)   11.42% (Libor + 9.75%/Q)     1/3/2017     16.9     16.9 (2)(17)      
        Common stock (458,596 shares)         1/3/2017     14.0     10.8        
        Warrant to purchase up to 56,372 shares of common stock (expires 12/2023)         1/3/2017                
                        30.9     27.7        
                                       
S Toys Holdings LLC (fka The Step2 Company, LLC)(8)   Toy manufacturer   Class B common units (126,278,000 units)         10/30/2014         0.5 (2)      
        Common units (1,116,879 units)         4/1/2011                
        Warrant to purchase up to 3,157,895 units         4/1/2010                
                            0.5        
                                       
SHO Holding I Corporation   Manufacturer and distributor of slip resistant footwear   Second lien senior secured loan ($100.0 par due 4/2023)   9.92% (Libor + 8.50%/Q)     10/27/2015     98.2     92.0 (2)(17)      
                                       
Shock Doctor, Inc. and Shock Doctor Holdings, LLC(7)   Developer, marketer and distributor of sports protection equipment and accessories   Second lien senior secured loan ($89.4 par due 10/2021)   11.86% (Libor + 10.50%/Q)     4/22/2015     89.4     82.3 (2)(17)      
        Class A preferred units (50,000 units)         3/14/2014     5.0     1.9 (2)      
        Class C preferred units (50,000 units)         4/22/2015     5.0     1.9 (2)      
                        99.4     86.1        
                                       
Singer Sewing Company   Manufacturer of consumer sewing machines   First lien senior secured loan ($174.5 par due 12/2017)   9.19% (Libor + 7.00% Cash, 0.50% PIK/Q)     7/26/2017     174.5     165.7 (2)(17)      
                                       
Varsity Brands Holding Co., Inc., Hercules Achievement, Inc., Hercules Achievement Holdings, Inc. and Hercules VB Holdings, Inc.   Leading manufacturer and distributor of textiles, apparel & luxury goods   Second lien senior secured loan ($122.7 par due 12/2025)   9.82% (Libor + 8.25%/Q)     12/15/2017     122.7     122.7 (2)(17)      
        Common stock (3,548,841 shares)         12/11/2014     3.8     6.1 (2)      
        Common stock (3,548,841 shares)         12/11/2014     4.3     6.1 (2)      
                        130.8     134.9        
                                       
Woodstream Group, Inc. and Woodstream Corporation(21)   Pet products manufacturer   First lien senior secured loan ($1.0 par due 5/2022)   7.69% (Libor + 6.25%/Q)     6/21/2017     1.0     1.0 (2)(17)      
        First lien senior secured loan ($2.0 par due 5/2022)   7.69% (Libor + 6.25%/Q)     6/21/2017     2.0     2.0 (4)(17)      
        First lien senior secured loan ($3.1 par due 5/2022)   7.89% (Libor + 6.25%/Q)     6/21/2017     3.1     3.1 (2)(17)      
        First lien senior secured loan ($6.2 par due 5/2022)   7.89% (Libor + 6.25%/Q)     6/21/2017     6.2     6.2 (4)(17)      
                        12.3     12.3        
                        865.8     806.0     11.36 %

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Other Services                                      
American Residential Services L.L.C.   Heating, ventilation and air conditioning services provider   Second lien senior secured loan ($67.0 par due 12/2022)   9.57% (Libor + 8.00%/Q)     6/30/2014     66.7     66.3 (2)(17)      
                                       
Associated Asphalt Partners, LLC   Provider of asphalt terminalling, storage and distribution   First lien senior secured loan ($4.2 par due 4/2024)   6.82% (Libor + 5.25%/Q)     3/30/2017     4.2     3.8 (2)(17)      
                                       
Champion Parent Corporation and Calera XVI, LLC(8)   Endurance sports media and event operator   First lien senior secured revolving loan ($0.7 par due 11/2018)       11/30/2012         (2)(16)      
        First lien senior secured loan ($5.9 par due 11/2018)       11/30/2012     0.9     0.2 (2)(16)      
        Preferred shares (18,875 shares)         3/25/2016         (2)      
        Membership units (2,522,512 units)         11/30/2012         (2)      
        Common shares (114,000 shares)         3/25/2016         (2)      
                        0.9     0.2        
                                       
Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC(7)(21)   Provider of outsourced healthcare linen management solutions   First lien senior secured revolving loan ($2.0 par due 12/2021)   7.82% (Libor + 6.25%/Q)     3/13/2014     2.0     2.0 (2)(17)(20)      
        First lien senior secured loan ($12.0 par due 12/2021)   7.82% (Libor + 6.25%/Q)     4/6/2017     12.0     12.0 (2)(17)      
        First lien senior secured loan ($5.0 par due 12/2021)   7.82% (Libor + 6.25%/Q)     3/13/2014     5.0     5.0 (2)(17)      
        First lien senior secured loan ($5.2 par due 12/2021)   7.82% (Libor + 6.25%/Q)     3/13/2014     5.2     5.2 (3)(17)      
        Class A preferred units (2,475,000 units)         3/13/2014     2.5     3.9 (2)      
        Class B common units (275,000 units)         3/13/2014     0.3     0.4 (2)      
                        27.0     28.5        
                                       
CST Buyer Company (d/b/a Intoxalock)(21)   Provider of ignition interlock devices   First lien senior secured loan ($11.3 par due 3/2023)   7.75% (Libor + 6.25%/Q)     3/1/2017     11.0     11.3 (2)(17)      
                                       
Dwyer Acquisition Parent, Inc. and TDG Group Holding Company   Operator of multiple franchise concepts primarily related to home maintenance or repairs   Senior subordinated loan ($52.7 par due 2/2020)   11.00%     8/15/2014     52.7     52.7 (2)      
        Senior subordinated loan ($23.5 par due 2/2020)   11.00%     5/1/2017     23.5     23.5 (2)      
        Senior subordinated loan ($31.5 par due 2/2020)   11.00%     6/12/2015     31.5     31.5 (2)      
        Common stock (32,843 shares)         8/15/2014     2.2     5.1 (2)      
                        109.9     112.8        
                                       
Massage Envy, LLC and ME Equity LLC(21)   Franchisor in the massage industry   First lien senior secured revolving loan ($0.5 par due 9/2020)   8.44% (Libor + 6.75%/Q)     6/28/2017     0.5     0.5 (2)(17)      
        First lien senior secured loan ($0.3 par due 9/2020)   8.23% (Libor + 6.75%/Q)     4/12/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($1.0 par due 9/2020)   8.24% (Libor + 6.75%/Q)     4/12/2017     1.0     1.0 (2)(17)      
        First lien senior secured loan ($0.1 par due 9/2020)   10.00% (Base Rate + 5.50%/Q)     4/12/2017     0.1     0.1 (2)(17)      
        First lien senior secured loan ($0.3 par due 9/2020)   8.11% (Libor + 6.75%/Q)     7/27/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($0.5 par due 9/2020)   8.23% (Libor + 6.75%/Q)     7/27/2017     0.5     0.5 (2)(17)      
        First lien senior secured loan ($38.5 par due 9/2020)   8.37% (Libor + 6.75%/Q)     9/27/2012     38.5     38.5 (3)(17)      
        First lien senior secured loan ($18.7 par due 9/2020)   8.37% (Libor + 6.75%/Q)     9/27/2012     18.7     18.7 (4)(17)      
        Common stock (3,000,000 shares)         9/27/2012     3.0     4.2 (2)      
                        62.9     64.1        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
McKenzie Sports Products, LLC(21)   Designer, manufacturer and distributor of hunting-related supplies   First lien senior secured revolving loan ($0.9 par due 9/2020)   7.25% (Base Rate + 2.75%/Q)     9/18/2014     0.9     0.9 (3)(17)      
        First lien senior secured loan ($0.8 par due 9/2020)   7.44% (Libor + 5.75%/Q)     9/18/2014     0.8     0.8 (3)(13)(17)      
        First lien senior secured loan ($2.5 par due 9/2020)   5.32% (Libor + 3.75%/Q)     9/18/2014     2.5     2.5 (3)(17)      
        First lien senior secured loan ($2.2 par due 9/2020)   5.44% (Libor + 3.75%/Q)     9/18/2014     2.2     2.2 (3)(17)      
        First lien senior secured loan ($84.5 par due 9/2020)   7.44% (Libor + 5.75%/Q)     9/18/2014     84.5     84.5 (3)(13)(17)      
                        90.9     90.9        
                                       
MSHC, Inc.(21)   Heating, ventilation and air conditioning services provider   First lien senior secured revolving loan ($0.1 par due 7/2022)   7.75% (Base Rate + 3.25%/Q)     7/31/2017     0.1     0.1 (2)(17)      
        First lien senior secured loan ($1.1 par due 7/2023)   5.92% (Libor + 4.25%/Q)     7/31/2017     1.1     1.1 (2)(17)      
        First lien senior secured loan ($3.2 par due 7/2023)   5.94% (Libor + 4.25%/Q)     7/31/2017     3.1     3.2 (2)(17)      
        Second lien senior secured loan ($46.0 par due 7/2024)   9.94% (Libor + 8.25%/Q)     7/31/2017     46.0     46.0 (2)(17)      
                        50.3     50.4        
                                       
OpenSky Project, Inc. and OSP Holdings, Inc.   Social commerce platform operator   Warrant to purchase up to 159,496 shares of Series D preferred stock (expires 4/2025)         6/29/2015         (2)      
                                       
Osmose Utilities Services, Inc.(21)   Provider of structural integrity management services to transmission and distribution infrastructure   First lien senior secured revolving loan       1/3/2017         (19)      
        Second lien senior secured loan ($25.0 par due 8/2023)   9.44% (Libor + 7.75%/Q)     9/3/2015     24.6     25.0 (2)(17)      
        Second lien senior secured loan ($34.0 par due 8/2023)   9.44% (Libor + 7.75%/Q)     1/3/2017     33.4     34.0 (2)(17)      
                        58.0     59.0        
                                       
SocialFlow, Inc.   Social media optimization platform provider   Warrant to purchase up to 215,331 shares of Series C preferred stock (expires 1/2026)         1/13/2016         (5)      
                                       
SoundCloud Limited(9)   Platform for receiving, sending, and distributing music   Common stock (73,422 shares)         8/15/2017     0.4     0.7 (2)      
                                       
Spin HoldCo Inc.   Laundry service and equipment provider   Second lien senior secured loan ($175.0 par due 5/2023)   9.21% (Libor + 7.75%/Q)     6/23/2017     175.0     175.0 (2)(17)      
                                       
Tyden Cayman Holdings Corp.(9)   Producer and marketer of global cargo security, product identification and traceability products and utility meter products   Preferred stock (46,276 shares)         1/3/2017     0.4     0.4        
        Common stock (5,521,203 shares)         1/3/2017     2.0     2.9        
                        2.4     3.3        
                                       
VLS Recovery Services, LLC(21)   Provider of commercial and industrial waste processing and disposal services   First lien senior secured revolving loan ($1.6 par due 10/2023)   7.53% (Libor + 6.00%/Q)     10/17/2017     1.6     1.6 (2)(17)(20)      
        First lien senior secured loan ($23.9 par due 10/2023)   7.53% (Libor + 6.00%/Q)     10/17/2017     23.9     23.7 (2)(17)      
        First lien senior secured loan ($7.4 par due 10/2023)   7.35% (Libor + 6.00%/Q)     10/17/2017     7.4     7.4 (2)(17)      
        First lien senior secured loan ($0.1 par due 10/2023)   9.50% (Base Rate + 5.00%/Q)     10/17/2017     0.1     0.1 (2)(17)      
                        33.0     32.8        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
WASH Multifamily Acquisition Inc. and Coinamatic Canada Inc.   Laundry service and equipment provider   Second lien senior secured loan ($3.7 par due 5/2023)   8.57% (Libor + 7.00%/Q)     5/14/2015     3.7     3.7 (2)(17)      
        Second lien senior secured loan ($21.3 par due 5/2023)   8.57% (Libor + 7.00%/Q)     5/14/2015     21.0     21.1 (2)(17)      
                        24.7     24.8        
                                       
Wrench Group LLC(21)   Provider of essential home services to residential customers   First lien senior secured loan ($4.0 par due 3/2022)   6.19% (Libor + 4.50%/Q)     1/31/2017     4.0     4.0 (2)(17)      
        First lien senior secured loan ($4.3 par due 3/2022)   5.85% (Libor + 4.50%/Q)     12/15/2017     4.3     4.3 (2)(17)      
                        8.3     8.3        
                        725.6     732.2     10.32 %
Manufacturing                                      
Chariot Acquisition, LLC(21)   Aftermarket golf cart parts and accessories   First lien senior secured loan ($18.4 par due 9/2021)   7.91% (Libor + 6.25%/Q)     1/3/2017     18.2     18.0 (3)(17)      
        First lien senior secured loan ($9.4 par due 9/2021)   7.91% (Libor + 6.25%/Q)     1/3/2017     9.3     9.2 (4)(17)      
                        27.5     27.2        
                                       
Component Hardware Group, Inc.(21)   Commercial equipment   First lien senior secured revolving loan ($1.9 par due 7/2019)   6.19% (Libor + 4.50%/Q)     7/1/2013     1.9     1.9 (2)(17)      
        First lien senior secured loan ($7.9 par due 7/2019)   6.19% (Libor + 4.50%/Q)     7/1/2013     7.9     7.9 (4)(17)      
                        9.8     9.8        
                                       
Dorner Holding Corp.(21)   Manufacturer of precision unit conveyors   First lien senior secured revolving loan ($1.3 par due 3/2022)   7.32% (Libor + 5.75%/Q)     3/15/2017     1.3     1.3 (2)(17)      
        First lien senior secured loan ($4.4 par due 3/2023)   7.32% (Libor + 5.75%/Q)     3/15/2017     4.4     4.4 (2)(17)      
                        5.7     5.7        
                                       
ECI Purchaser Company, LLC   Manufacturer of equipment to safely control pressurized gases   First lien senior secured loan ($21.8 par due 12/2018)   7.09% (Libor + 5.25%/Q)     7/26/2017     21.8     21.5 (2)(17)      
        First lien senior secured loan ($88.7 par due 12/2018)   6.92% (Libor + 5.25%/Q)     7/26/2017     88.7     87.8 (2)(17)      
        First lien senior secured loan ($74.8 par due 12/2018)   6.92% (Libor + 5.25%/Q)     7/26/2017     74.8     74.0 (3)(17)      
        First lien senior secured loan ($0.3 par due 12/2018)   7.09% (Libor + 5.25%/Q)     7/26/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($0.2 par due 12/2018)   7.09% (Libor + 5.25%/Q)     7/26/2017     0.2     0.2 (3)(17)      
                        185.8     183.8        
                                       
ETG Holdings, Inc.(8)   Industrial woven products   Common stock (3,000 shares)         1/3/2017                
                                       
Harvey Tool Company, LLC(21)   Cutting tool provider to the metalworking industry   First lien senior secured revolving loan ($1.8 par due 10/2023)   5.96% (Libor + 4.50%/Q)     10/12/2017     1.8     1.7 (2)(17)      
        First lien senior secured loan ($40.8 par due 10/2024)   6.11% (Libor + 4.75%/Q)     10/12/2017     40.8     40.4 (2)(17)      
        Second lien senior secured loan ($43.7 par due 10/2025)   10.02% (Libor + 8.50%/Q)     10/12/2017     43.7     43.2 (2)(17)      
                        86.3     85.3        
                                     

F-69


Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Ioxus, Inc(7)   Energy storage devices   First lien senior secured loan ($10.2 par due 12/2019)   12.00% PIK     4/29/2014     10.0     10.2 (2)(15)      
        First lien senior secured loan ($1.0 par due 12/2019)       4/29/2014     1.0     1.0 (2)(15)      
        Series CC preferred stock (67,330,609 shares)         1/27/2017     0.7     (2)      
        Warrant to purchase up to 3,038,730 shares of common stock (expires 1/2026)         1/28/2016         (2)      
        Warrant to purchase up to 1,210,235 shares of Series BB preferred stock (expires 8/2026)         1/28/2016         (2)      
        Warrant to purchase up to 336,653,045 shares of Series CC preferred stock (expires 1/2027)         1/27/2017         (2)      
                        11.7     11.2        
                                       
KPS Global LLC   Walk-in cooler and freezer systems   First lien senior secured loan ($1.7 par due 4/2022)   3.93% (Libor + 2.50%/Q)     4/5/2017     1.7     1.7 (2)(17)      
        First lien senior secured loan ($11.2 par due 4/2022)   7.18% (Libor + 5.75%/Q)     4/5/2017     11.2     11.0 (2)(17)      
        First lien senior secured loan ($5.6 par due 4/2022)   7.18% (Libor + 5.75%/Q)     4/5/2017     5.6     5.5 (4)(17)      
                        18.5     18.2        
                                       
MacLean-Fogg Company and MacLean-Fogg Holdings, L.L.C.   Manufacturer and supplier for the power utility and automotive markets worldwide   Senior subordinated loan ($103.0 par due 10/2025)   10.50% Cash, 3.00% PIK     10/31/2013     103.0     103.0 (2)      
        Preferred units (70,183 units)   4.50% Cash, 9.25% PIK     10/9/2015     76.3     76.3        
                        179.3     179.3        
                                       
Niagara Fiber Intermediate Corp.(21)   Insoluble fiber filler products   First lien senior secured revolving loan ($0.9 par due 5/2018)       5/8/2014         (2)(16)      
        First lien senior secured loan ($5.9 par due 5/2018)       5/8/2014     0.2     (2)(16)      
        First lien senior secured loan ($0.6 par due 5/2018)       5/8/2014         (2)(16)      
                        0.2            
                                       
Nordco Inc.(21)   Railroad maintenance-of-way machinery   First lien senior secured revolving loan       8/26/2015         (19)      
                                       
Pelican Products, Inc.   Flashlights   Second lien senior secured loan ($40.0 par due 4/2021)   9.94% (Libor + 8.25%/Q)     4/11/2014     40.0     39.6 (2)(17)      
                                       
Sanders Industries Holdings, Inc. and SI Holdings, Inc.(21)   Elastomeric parts, mid-sized composite structures, and composite tooling   First lien senior secured loan ($56.5 par due 5/2020)   7.38% (Libor + 6.00%/Q)     7/21/2017     56.5     55.4 (2)(17)      
        First lien senior secured loan ($14.8 par due 5/2020)   7.38% (Libor + 6.00%/Q)     7/21/2017     14.8     14.5 (4)(17)      
        Common stock (1,500 shares)         5/30/2014     1.5     0.8 (2)      
                        72.8     70.7        
                                       
Saw Mill PCG Partners LLC   Metal precision engineered components   Common units (1,000 units)         1/30/2007     1.0     (2)      
                                     

F-70


Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Sonny's Enterprises, LLC(21)   Manufacturer and supplier of car wash equipment, parts and supplies to the conveyorized car wash market   First lien senior secured revolving loan ($1.0 par due 12/2022)   6.30% (Libor + 4.75%/Q)     11/30/2017     1.0     1.0 (2)(17)      
        First lien senior secured loan ($0.9 par due 12/2022)   6.44% (Libor + 4.75%/Q)     12/5/2017     0.9     0.9 (2)(17)      
        First lien senior secured loan ($0.4 par due 12/2022)   6.44% (Libor + 4.75%/Q)     6/1/2017     0.4     0.4 (2)(17)      
        First lien senior secured loan ($0.2 par due 12/2022)   6.44% (Libor + 4.75%/Q)     5/3/2017     0.2     0.2 (2)(17)      
        First lien senior secured loan ($0.2 par due 12/2022)   6.44% (Libor + 4.75%/Q)     9/28/2017     0.2     0.2 (2)(17)      
                        2.7     2.7        
                                       
Sunk Rock Foundry Partners LP, Hatteras Electrical Manufacturing Holding Company and Sigma Electric Manufacturing Corporation(21)   Manufacturer of metal castings, precision machined components and sub-assemblies in the electrical products, power transmission and distribution and general industrial markets   First lien senior secured revolving loan ($1.5 par due 10/2022)   6.16% (Libor + 4.75%/Q)     10/31/2017     1.5     1.5 (2)(17)      
        First lien senior secured loan ($16.4 par due 10/2023)   6.13% (Libor + 4.75%/Q)     10/31/2017     16.4     16.2 (2)(17)      
        First lien senior secured loan ($9.3 par due 10/2023)   6.13% (Libor + 4.75%/Q)     10/31/2017     9.3     9.2 (2)(17)      
                        27.2     26.9        
                                       
TPTM Merger Corp.(21)   Time temperature indicator products   First lien senior secured loan ($10.5 par due 9/2018)   9.98% (Libor + 8.42%/Q)     9/12/2013     10.5     10.5 (3)(17)      
        First lien senior secured loan ($6.2 par due 9/2018)   9.98% (Libor + 8.42%/Q)     9/12/2013     6.2     6.2 (4)(17)      
        First lien senior secured loan ($6.5 par due 9/2018)   10.11% (Libor + 8.42%/Q)     9/12/2013     6.5     6.5 (3)(17)      
        First lien senior secured loan ($3.8 par due 9/2018)   10.11% (Libor + 8.42%/Q)     9/12/2013     3.8     3.8 (4)(17)      
                        27.0     27.0        
                                       
WP CPP Holdings, LLC   Precision engineered castings   Second lien senior secured loan ($19.7 par due 4/2021)   9.13% (Libor + 7.75%/Q)     1/3/2017     18.8     19.3 (2)(17)      
                        714.3     706.7     9.96 %
Investment Funds and Vehicles                                      
ACAS Equity Holdings Corporation(8)(10)   Investment company   Common stock (589 shares)         1/3/2017     0.5     0.4        
                                       
Ares IIIR/IVR CLO Ltd.(8)(9)(10)   Investment vehicle   Subordinated notes ($20.0 par due 4/2021)         1/3/2017         0.1        
                                       
Blue Wolf Capital Fund II, L.P.(9)(10)   Investment partnership   Limited partnership interest (8.50% interest)         1/3/2017     3.0     3.5 (24)      
                                       
Carlyle Global Market Strategies CLO 2013-3(9)(10)   Investment vehicle   Subordinated notes ($5.0 par due 10/2030)   15.00%     1/3/2017     2.6     3.2        
                                       
Cent CLO 2014-22 Limited(9)(10)   Investment vehicle   Subordinated notes ($45.4 par due 11/2026)   11.75%     1/3/2017     23.6     22.7        
                                       
Centurion CDO 8 Limited(9)(10)   Investment vehicle   Subordinated notes ($5.0 par due 3/2019)         1/3/2017                
                                       
CGMS 2015-3A(9)(10)   Investment vehicle   Subordinated notes ($24.6 par due 7/2028)   10.00%     1/3/2017     19.2     18.9        
                                       
CoLTs 2005-1 Ltd.(8)(9)(10)   Investment vehicle   Preferred shares (360 shares)         1/3/2017                
                                       
CoLTs 2005-2 Ltd.(8)(9)(10)   Investment vehicle   Preferred shares (34,170,000 shares)         1/3/2017                
                                       
CREST Exeter Street Solar 2004-1(9)(10)   Investment vehicle   Preferred shares (3,500,000 shares)         1/3/2017                
                                       
Eaton Vance CDO X plc(9)(10)   Investment vehicle   Subordinated notes ($15.0 par due 2/2027)   3.00%     1/3/2017     4.1     6.4        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
European Capital UK SME Debt LP(8)(9)(10)(22)   Investment partnership   Limited partnership interest (45% interest)         1/3/2017     41.1     41.7        
                                       
Flagship CLO V(9)(10)   Investment vehicle   Subordinated notes ($0.0 par due 9/2019)         1/3/2017                
                                       
Goldentree Loan Opportunities VII, Limited(9)(10)   Investment vehicle   Subordinated notes ($35.3 par due 4/2025)   4.25%     1/3/2017     18.7     19.1        
                                       
Halcyon Loan Advisors Funding 2015-2 Ltd.(9)(10)   Investment vehicle   Subordinated notes ($21.7 par due 7/2027)   16.35%     1/3/2017     14.0     11.3        
                                       
HCI Equity, LLC(8)(9)(10)   Investment company   Member interest (100.00% interest)         4/1/2010         0.1 (24)      
                                       
Herbert Park B.V.(9)(10)   Investment vehicle   Subordinated notes ($5.4 par due 10/2026)         1/3/2017     0.9     0.5        
                                       
Imperial Capital Private Opportunities, LP(10)   Investment partnership   Limited partnership interest (80.00% interest)         5/10/2007     1.0     15.1 (2)      
                                       
LightPoint CLO VII, Ltd.(9)(10)   Investment vehicle   Subordinated notes ($9.0 par due 5/2021)         1/3/2017                
                                       
Montgomery Lane, LLC and Montgomery Lane, Ltd.(8)(9)(10)   Investment company   Common stock (100 shares)         1/3/2017         0.6        
        Common stock (50,000 shares)         1/3/2017                
                            0.6        
                                       
OAKC 2015-11(9)(10)   Investment vehicle   Subordinated notes ($17.8 par due 10/2028)   9.50%     1/3/2017     14.3     13.0        
                                       
Partnership Capital Growth Fund I, L.P.(10)   Investment partnership   Limited partnership interest (25.00% interest)         6/16/2006         0.1 (2)(24)      
                                       
Partnership Capital Growth Investors III, L.P.(10)(22)   Investment partnership   Limited partnership interest (2.50% interest)         10/5/2011     2.5     3.5 (2)(24)      
                                       
PCG-Ares Sidecar Investment II, L.P.(10)(22)   Investment partnership   Limited partnership interest (100.00% interest)         10/31/2014     7.5     11.7 (2)      
                                       
PCG-Ares Sidecar Investment, L.P.(10)(22)   Investment partnership   Limited partnership interest (100.00% interest)         5/22/2014     4.4     5.1 (2)      
                                       
Piper Jaffray Merchant Banking Fund I, L.P.(10)(22)   Investment partnership   Limited partnership interest (2.00% interest)         8/16/2012     1.5     1.6 (24)      
                                       
Qualium Investissement(9)(10)   Investment partnership   Class A common stock (9,900,000 shares)         1/3/2017     5.9     6.5 (24)      
        Class B common stock (100,000 shares)         1/3/2017     0.1     0.1 (24)      
        Class C common stock (48,939 shares)         1/3/2017     0.1     0.1 (24)      
                        6.1     6.7        
                                       
Senior Direct Lending Program, LLC(8)(10)(23)   Co-investment vehicle   Subordinated certificates ($487.1 par due 12/2036)   9.34% (Libor + 8.00%/Q)(18)     7/27/2016     487.1     487.1        
        Member interest (87.50% interest)         7/27/2016                
                        487.1     487.1        
                                       
Vitesse CLO, Ltd.(9)(10)   Investment vehicle   Preferred shares (20,000,000 shares)         1/3/2017                
                                       
Voya CLO 2014-4 Ltd.(9)(10)   Investment vehicle   Subordinated notes ($26.7 par due 10/2026)   10.50%     1/3/2017     17.0     18.6        
                                       
VSC Investors LLC(10)   Investment company   Membership interest (1.95% interest)         1/24/2008     0.3     1.3 (2)(24)      
                        669.4     692.3     9.75 %

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Financial Services                                      
Callidus Capital Corporation(8)   Asset management services   Common stock (100 shares)         4/1/2010     3.0     1.7        
                                       
Ciena Capital LLC(8)(21)   Real estate and small business loan servicer   First lien senior secured revolving loan ($14.0 par due 12/2017)   6.00%     11/29/2010     14.0     14.0 (2)      
        Equity interests         11/29/2010     25.0     18.3 (2)      
                        39.0     32.3        
                                       
Commercial Credit Group, Inc.   Commercial equipment finance and leasing company   Senior subordinated loan ($28.0 par due 8/2022)   11.11% (Libor + 9.75%/Q)     5/10/2012     28.0     28.0 (2)(17)      
                                       
DFC Global Facility Borrower II LLC(21)   Non-bank provider of alternative financial services   First lien senior secured revolving loan ($75.0 par due 9/2022)   12.11% (Libor + 10.75%/Q)     9/27/2017     75.0     75.0 (2)(17)      
                                       
Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.(7)   Debt collection services provider   Common stock (180 shares)         1/11/2017         (2)      
                                       
Gordian Group, LLC   Provider of products, services and software to organizations pursuing efficient and effective procurement and information solutions   Common stock (526 shares)         11/30/2012         (2)      
                                       
Imperial Capital Group LLC   Investment services   Class A common units (24,945 units)         5/10/2007     6.1     10.2 (2)      
        2006 Class B common units (8,173 units)         5/10/2007         (2)      
                        6.1     10.2        
                                       
Ivy Hill Asset Management, L.P.(8)(10)   Asset management services   Member interest (100.00% interest)         6/15/2009     244.0     315.1        
                                       
Javlin Three LLC, Javlin Four LLC, and Javlin Five LLC(10)   Asset-backed financial services company   First lien senior secured loan ($18.6 par due 6/2017)   11.36% (Libor + 10.00%/Q)     6/24/2014     18.6     16.8 (2)(17)      
                                       
LS DE LLC and LM LSQ Investors LLC(10)   Asset based lender   Senior subordinated loan ($3.0 par due 6/2021)   10.50%     6/15/2017     3.0     3.0 (2)      
        Senior subordinated loan ($27.0 par due 6/2021)   10.50%     6/25/2015     27.0     27.0 (2)      
        Membership units (3,275,000 units)         6/25/2015     3.3     3.9        
                        33.3     33.9        
                        447.0     513.0     7.23 %
Food and Beverage                                      
American Seafoods Group LLC and American Seafoods Partners LLC   Harvester and processor of seafood   Second lien senior secured loan ($87.0 par due 2/2024)   9.57% (Libor + 8.13%/Q)     8/21/2017     86.8     87.0 (2)(17)      
        Class A units (77,922 units)         8/19/2015     0.1     0.1 (2)      
        Warrant to purchase up to 7,422,078 Class A units (expires 8/2035)         8/19/2015     7.4     10.1 (2)      
                        94.3     97.2        
                                       
Bakemark Holdings, Inc.   Manufacturer and distributor of specialty bakery ingredients   First lien senior secured loan ($1.7 par due 8/2023)   6.94% (Libor + 5.25%/Q)     8/14/2017     1.7     1.7 (2)(17)      
                                       
DecoPac, Inc.(21)   Supplier of cake decorating solutions and products to in-store bakeries   First lien senior secured revolving loan ($2.3 par due 9/2023)   5.94% (Libor + 4.25%/Q)     9/29/2017     2.3     2.2 (2)(17)      
        First lien senior secured revolving loan ($0.3 par due 9/2023)   5.89% (Libor + 4.25%/Q)     9/29/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($8.4 par due 9/2024)   5.94% (Libor + 4.25%/Q)     9/29/2017     8.4     8.3 (2)(17)      
                        11.0     10.8        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Eagle Family Foods Group LLC   Manufacturer and producer of milk products   First lien senior secured loan ($0.2 par due 12/2021)   5.69% (Libor + 4.00%/Q)     8/29/2017     0.2     0.2 (2)(17)      
        First lien senior secured loan ($7.9 par due 12/2021)   10.74% (Libor + 9.05%/Q)     9/11/2017     7.8     7.5 (2)(17)      
        First lien senior secured loan ($1.4 par due 12/2021)   10.74% (Libor + 9.05%/Q)     8/22/2016     1.4     1.3 (2)(17)      
        First lien senior secured loan ($20.2 par due 12/2021)   10.74% (Libor + 9.05%/Q)     8/22/2016     20.2     19.2 (3)(17)      
        First lien senior secured loan ($54.8 par due 12/2021)   10.74% (Libor + 9.05%/Q)     12/31/2015     54.5     52.0 (3)(17)      
                        84.1     80.2        
                                       
Edward Don & Company, LLC and VCP-EDC Co-Invest, LLC   Distributor of foodservice equipment and supplies   First lien senior secured loan ($47.6 par due 9/2022)   10.00% (Libor + 8.50%/Q)     3/31/2017     47.6     47.6 (2)(17)      
        Membership units (2,970,000 units)         6/9/2017     3.0     3.4        
                        50.6     51.0        
                                       
FPI Holding Corporation(8)(21)   Distributor of fruits   First lien senior secured loan ($0.7 par due 6/2018)       1/3/2017     0.4     0.4 (16)      
                                       
Gehl Foods, LLC and GF Parent LLC   Producer of low-acid, aseptic food and beverage products   First lien senior secured loan ($120.7 par due 6/2019)   7.88% (Libor + 6.50%/Q)     7/26/2017     120.7     120.7 (2)(17)      
        Class A preferred units (2,940 units)         5/13/2015     2.9     1.9 (2)      
        Class A common units (60,000 units)         5/13/2015     0.1     (2)      
        Class B common units (0.26 units)         5/13/2015         (2)      
                        123.7     122.6        
                                       
JWC/KI Holdings, LLC   Foodservice sales and marketing agency   Membership units (5,000 units)         11/16/2015     5.0     5.3 (2)      
                                       
Kettle Cuisine, LLC   Manufacturer of fresh refrigerated and frozen food products   Second lien senior secured loan ($28.5 par due 2/2022)   11.21% (Libor + 9.75%/Q)     8/21/2015     28.5     28.5 (2)(17)      
                                       
NECCO Holdings, Inc. and New England Confectionery Company, Inc.(8)(21)   Producer and supplier of candy   First lien senior secured revolving loan ($21.7 par due 1/2018)       1/3/2017     9.7     9.2 (16)      
        First lien senior secured loan ($0.6 par due 8/2018)       11/20/2017     0.6     (16)      
        First lien senior secured loan ($10.9 par due 1/2018)       1/3/2017     0.9     1.3 (16)      
        First lien senior secured loan ($0.7 par due 1/2018)       11/20/2017     0.7     0.1 (16)      
        Common stock (860,189 shares)         1/3/2017                
                        11.9     10.6        
                                       
RF HP SCF Investor, LLC(10)   Branded specialty food company   Membership interest (10.08% interest)         12/22/2016     12.5     14.4 (2)      
Teasdale Foods, Inc.(21)   Provider of beans, sauces and hominy to the retail, foodservice and wholesale channels   First lien senior secured revolving loan ($0.2 par due 10/2020)   6.18% (Libor + 4.75%/Q)     6/30/2017     0.2     0.2 (2)(17)      
        First lien senior secured revolving loan ($0.2 par due 10/2020)   8.25% (Base Rate + 3.75%/Q)     6/30/2017     0.2     0.2 (2)(17)      
        Second lien senior secured loan ($33.6 par due 10/2021)   10.44% (Libor + 8.75%/Q)     1/3/2017     33.6     33.3 (2)(17)      
        Second lien senior secured loan ($21.3 par due 10/2021)   10.11% (Libor + 8.75%/Q)     1/3/2017     21.3     21.1 (2)(17)      
        Second lien senior secured loan ($31.5 par due 10/2021)   10.13% (Libor + 8.75%/Q)     1/3/2017     31.5     31.2 (2)(17)      
                        86.8     86.0        
                        510.5     508.7     7.17 %

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Power Generation                                      
Alphabet Energy, Inc.   Technology developer to convert waste-heat into electricity   First lien senior secured loan ($3.4 par due 8/2017)         12/16/2013     3.3     0.4 (2)(16)      
        Series 1B preferred stock (12,976 shares)         6/21/2016     0.2     (2)      
        Warrant to purchase up to 125,000 shares of Series 2 preferred stock (expires 12/2023)         6/30/2016     0.1     (2)      
                        3.6     0.4        
                                       
CPV Maryland Holding Company II, LLC   Gas turbine power generation facilities operator   Senior subordinated loan ($46.1 par due 12/2020)   5.00% Cash, 5.00% PIK     8/8/2014     46.1     42.4 (2)      
        Warrant to purchase up to 4 units of common stock (expires 8/2018)         8/8/2014         (2)      
                        46.1     42.4        
                                       
DESRI VI Management Holdings, LLC   Wind power generation facility operator   Senior subordinated loan ($13.9 par due 12/2021)   10.00%     12/24/2014     13.9     13.9 (2)      
                                       
Green Energy Partners, Stonewall LLC and Panda Stonewall Intermediate Holdings II LLC   Gas turbine power generation facilities operator   First lien senior secured loan ($24.9 par due 11/2021)   7.19% (Libor + 5.50%/Q)     11/13/2014     24.8     24.4 (2)(17)      
        Senior subordinated loan ($20.2 par due 12/2021)   8.00% Cash, 5.25% PIK     11/13/2014     20.2     19.5 (2)      
        Senior subordinated loan ($94.6 par due 12/2021)   8.00% Cash, 5.25% PIK     11/13/2014     94.6     91.3 (2)      
                        139.6     135.2        
                                       
Joule Unlimited Technologies, Inc. and Stichting Joule Global Foundation   Renewable fuel and chemical production developer   First lien senior secured loan ($8.3 par due 10/2018)       3/31/2015     7.9     0.4 (2)(16)      
        Warrant to purchase up to 32,051 shares of Series C-2 preferred stock (expires 7/2023)         7/25/2013         (2)(9)      
                        7.9     0.4        
                                       
Moxie Patriot LLC   Gas turbine power generation facilities operator   First lien senior secured loan ($33.9 par due 12/2020)   7.44% (Libor + 5.75%/Q)     12/19/2013     33.8     33.4 (2)(17)      
                                       
Navisun LLC and Navisun Holdings LLC(8)(21)   Owner and operater of commercial and industrial solar projects   First lien senior secured loan ($2.6 par due 11/2023)   8.00% PIK     11/15/2017     2.6     2.6 (2)      
        Series A Preferred units (1,000 units)   10.50% PIK     11/15/2017     0.3     0.3 (2)      
        Class A units (550 units)         11/15/2017         (2)      
                        2.9     2.9        
                                       
Panda Liberty LLC (fka Moxie Liberty LLC)   Gas turbine power generation facilities operator   First lien senior secured loan ($5.0 par due 8/2020)   8.19% (Libor + 6.50%/Q)     5/8/2017     4.6     4.6 (2)(17)      
        First lien senior secured loan ($34.4 par due 8/2020)   8.19% (Libor + 6.50%/Q)     8/21/2013     34.2     31.6 (2)(17)      
                        38.8     36.2        
                                       
Panda Temple Power II, LLC   Gas turbine power generation facilities operator   First lien senior secured loan ($19.6 par due 4/2019)   7.69% (Libor + 6.00%/Q)     4/3/2013     19.6     17.4 (2)(17)      
                                       
Panda Temple Power, LLC   Gas turbine power generation facilities operator   First lien senior secured revolving loan ($2.3 par due 4/2018)   10.35% (Libor + 9.00%/Q)     4/28/2017     2.3     2.3 (2)(17)      
        First lien senior secured loan ($24.8 par due 3/2022)       3/6/2015     23.6     18.4 (2)(16)      
                        25.9     20.7        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
PERC Holdings 1 LLC   Operator of recycled energy, combined heat and power, and energy efficiency facilities   Class B common units (21,653,543 units)         10/20/2014     21.7     24.0 (2)      
                                       
Riverview Power LLC   Operator of natural gas and oil fired power generation facilities   First lien senior secured loan ($98.1 par due 12/2022)   9.69% (Libor + 8.00%/Q)     12/29/2016     95.9     98.2 (2)(17)      
                        449.7     425.1     5.99 %
Restaurants and Food Services                                      
ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.(8)(21)   Restaurant owner and operator   First lien senior secured loan ($3.7 par due 12/2018)   19.67% PIK (Libor + 18.00%/Q)     12/22/2016     3.7     3.7 (2)(17)      
        First lien senior secured loan ($49.3 par due 12/2018)       11/27/2006     39.9     12.3 (2)(16)      
        Promissory note ($29.2 par due 12/2023)         11/27/2006     13.8     (2)      
        Warrant to purchase up to 0.95 units of Series D common stock (expires 12/2023)         12/18/2013         (2)      
                        57.4     16.0        
                                       
Benihana, Inc.(21)   Restaurant owner and operator   First lien senior secured revolving loan ($0.5 par due 7/2018)   8.57% (Libor + 7.00%/Q)     8/21/2012     0.5     0.5 (2)(17)(20)      
        First lien senior secured revolving loan ($1.1 par due 7/2018)   8.69% (Libor + 7.00%/Q)     8/21/2012     1.1     1.1 (2)(17)(20)      
        First lien senior secured revolving loan ($1.0 par due 7/2018)   10.25% (Base Rate + 5.75%/Q)     8/21/2012     1.0     0.9 (2)(17)(20)      
        First lien senior secured loan ($0.3 par due 1/2019)   8.59% (Libor + 7.00%/Q)     12/28/2016     0.3     0.3 (2)(17)      
        First lien senior secured loan ($4.7 par due 1/2019)   8.59% (Libor + 7.00%/Q)     8/21/2012     4.7     4.5 (4)(17)      
                        7.6     7.3        
                                       
Cozzini Bros., Inc. and BH-Sharp Holdings LP(21)   Provider of commercial knife sharpening and cutlery services in the restaurant industry   First lien senior secured loan ($1.9 par due 3/2023)   7.07% (Libor + 5.50%/Q)     3/10/2017     1.9     1.9 (2)(17)      
        First lien senior secured loan ($1.2 par due 3/2023)   6.92% (Libor + 5.50%/Q)     3/10/2017     1.2     1.2 (2)(17)      
        First lien senior secured loan ($19.3 par due 3/2023)   6.92% (Libor + 5.50%/Q)     3/10/2017     19.3     19.3 (4)(17)      
        Common units (2,950,000 units)         3/10/2017     3.0     2.8 (2)      
                        25.4     25.2        
FWR Holding Corporation(21)   Restaurant owner, operator, and franchisor   First lien senior secured revolving loan ($0.3 par due 8/2023)   7.57% (Libor + 6.00%/Q)     8/21/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($0.2 par due 8/2023)   7.60% (Libor + 6.00%/Q)     8/21/2017     0.2     0.2 (2)(17)      
        First lien senior secured loan ($2.0 par due 8/2023)   7.32% (Libor + 6.00%/Q)     8/21/2017     2.0     2.0 (2)(17)      
        First lien senior secured loan ($2.0 par due 8/2023)   7.48% (Libor + 6.00%/Q)     8/21/2017     2.0     2.0 (2)(17)      
                        4.5     4.5        
                                       
Garden Fresh Restaurant Corp. and GFRC Holdings LLC(8)(21)   Restaurant owner and operator   First lien senior secured revolving loan ($0.1 par due 2/2022)   9.50% (Libor + 8.00%/Q)     2/1/2017     0.1     0.1 (2)(17)(20)      
        First lien senior secured loan ($24.9 par due 2/2022)   9.50% (Libor + 8.00%/Q)     10/3/2013     24.9     24.9 (2)(17)      
                        25.0     25.0        
                                       
Global Franchise Group, LLC(21)   Worldwide franchisor of quick service restaurants   First lien senior secured loan ($8.7 par due 12/2019)   7.44% (Libor + 5.75%/Q)     9/15/2017     8.7     8.6 (2)(17)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Heritage Food Service Group, Inc. and WCI-HFG Holdings, LLC   Distributor of repair and replacement parts for commercial kitchen equipment   Second lien senior secured loan ($31.6 par due 10/2022)   9.92% (Libor + 8.50%/Q)     10/20/2015     31.6     31.6 (2)(17)      
        Preferred units (3,000,000 units)         10/20/2015     3.0     3.6 (2)      
                        34.6     35.2        
                                       
Hojeij Branded Foods, LLC(21)   Leading operator of airport concessions across the U.S.   First lien senior secured loan ($0.3 par due 7/2022)   7.29% (Libor + 6.00%/Q)     7/20/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($6.3 par due 7/2022)   7.57% (Libor + 6.00%/Q)     7/20/2017     6.2     6.3 (4)(17)      
                        6.5     6.6        
                                       
Jim N Nicks Management, LLC(21)   Restaurant owner and operator   First lien senior secured revolving loan ($1.2 par due 7/2023)   6.71% (Libor + 5.25%/Q)     7/10/2017     1.2     1.2 (2)(17)      
        First lien senior secured revolving loan ($0.5 par due 7/2023)   6.64% (Libor + 5.25%/Q)     7/10/2017     0.5     0.5 (2)(17)      
        First lien senior secured loan ($0.6 par due 7/2023)   6.63% (Libor + 5.25%/Q)     7/10/2017     0.6     0.6 (2)(17)      
        First lien senior secured loan ($0.6 par due 7/2023)   6.94% (Libor + 5.25%/Q)     7/10/2017     0.6     0.6 (2)(17)      
        First lien senior secured loan ($14.1 par due 7/2023)   6.94% (Libor + 5.25%/Q)     7/10/2017     14.1     13.8 (4)(17)      
                        17.0     16.7        
                                       
Orion Foods, LLC(8)   Convenience food service retailer   First lien senior secured loan ($1.2 par due 9/2015)       4/1/2010     1.2     0.5 (2)(16)      
        Second lien senior secured loan ($19.4 par due 9/2015)       4/1/2010         (2)(16)      
        Preferred units (10,000 units)         10/28/2010         (2)      
        Class A common units (25,001 units)         4/1/2010         (2)      
        Class B common units (1,122,452 units)         4/1/2010         (2)      
                        1.2     0.5        
                                       
OTG Management, LLC(21)   Airport restaurant operator   First lien senior secured revolving loan ($8.4 par due 8/2021)   9.85% (Libor + 8.50%/Q)     8/26/2016     8.4     8.4 (2)(17)      
        First lien senior secured loan ($4.9 par due 8/2021)   9.88% (Libor + 8.50%/Q)     8/26/2016     4.9     4.9 (2)(17)      
        First lien senior secured loan ($1.6 par due 8/2021)   9.91% (Libor + 8.50%/Q)     8/26/2016     1.6     1.6 (2)(17)      
        First lien senior secured loan ($2.2 par due 8/2021)   9.98% (Libor + 8.50%/Q)     8/26/2016     2.2     2.2 (2)(17)      
        First lien senior secured loan ($97.8 par due 8/2021)   9.88% (Libor + 8.50%/Q)     8/26/2016     97.8     97.8 (3)(17)      
        Senior subordinated loan ($25.3 par due 2/2022)   17.50% PIK     8/26/2016     25.1     25.3 (2)      
        Class A preferred units (3,000,000 units)         8/26/2016     30.0     34.7 (2)      
        Common units (3,000,000 units)         1/5/2011     3.0     9.1 (2)      
        Warrant to purchase up to 7.73% of common units (expires 6/2018)         6/19/2008     0.1     (2)      
        Warrant to purchase 0.60% of the common units deemed outstanding (expires 12/2018)         8/29/2016         19.9 (2)      
                        173.1     203.9        
Restaurant Holding Company, LLC   Fast food restaurant operator   First lien senior secured loan ($31.7 par due 2/2019)   9.32% (Libor + 7.75%/Q)     3/13/2014     31.6     30.7 (3)(17)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Restaurant Technologies, Inc.(21)   Provider of bulk cooking oil management services to the restaurant and fast food service industries   First lien senior secured revolving loan ($0.2 par due 11/2021)   6.32% (Libor + 4.75%/Q)     11/23/2016     0.2     0.2 (2)(17)(20)      
        First lien senior secured revolving loan ($0.4 par due 11/2021)   6.30% (Libor + 4.75%/Q)     11/23/2016     0.4     0.4 (2)(17)(20)      
                        0.6     0.6        
                                       
SFE Intermediate Holdco LLC(21)   Provider of outsourced foodservice to K-12 school districts   First lien senior secured revolving loan ($0.8 par due 7/2022)   6.50% (Libor + 5.00%/Q)     7/31/2017     0.8     0.8 (2)(17)      
        First lien senior secured loan ($6.8 par due 7/2023)   6.38% (Libor + 5.00%/Q)     7/31/2017     6.7     6.8 (4)(17)      
                        7.5     7.6        
                        400.7     388.4     5.47 %
Automotive Services                                      
A.U.L. Corp.(21)   Provider of vehicle service contracts ("VSCs") and limited warranties for passenger vehicles   First lien senior secured revolving loan ($0.4 par due 6/2023)   9.00% (Base Rate + 4.50%/Q)     6/7/2017     0.4     0.4 (2)(17)      
        First lien senior secured loan ($7.8 par due 6/2023)   6.75% (Libor + 5.00%/Q)     6/7/2017     7.8     7.8 (2)(17)      
                        8.2     8.2        
                                       
AEP Holdings, Inc. and Arrowhead Holdco Company   Distributor of non-discretionary, mission-critical aftermarket replacement parts   First lien senior secured loan ($0.1 par due 8/2021)   7.09% (Libor + 5.75%/Q)     7/21/2017     0.1     0.1 (2)(17)      
        First lien senior secured loan ($3.0 par due 8/2021)   7.13% (Libor + 5.75%/Q)     7/21/2017     3.0     3.0 (2)(17)      
        First lien senior secured loan ($1.5 par due 8/2021)   7.23% (Libor + 5.75%/Q)     7/21/2017     1.5     1.5 (2)(17)      
        Common stock (3,467 shares)         8/31/2015     3.5     4.3 (2)      
                        8.1     8.9        
                                       
ChargePoint, Inc.   Developer and operator of electric vehicle charging stations   Warrant to purchase up to 809,126 shares of Series E preferred stock (expires 12/2024)         12/30/2014     0.3     2.1 (2)      
                                       
Dent Wizard International Corporation and DWH Equity Investors, L.P.   Automotive reconditioning services   Second lien senior secured loan ($50.0 par due 10/2020)   10.24% (Libor + 8.75%/Q)     4/7/2015     50.0     50.0 (2)(17)      
        Class A common stock (10,000 shares)         4/7/2015     0.2     0.5 (2)      
        Class B common stock (20,000 shares)         4/7/2015     0.4     1.0 (2)      
                        50.6     51.5        
                                       
Eckler Industries, Inc.(21)   Restoration parts and accessories provider for classic automobiles   First lien senior secured revolving loan ($2.0 par due 12/2017)       7/12/2012     2.0     1.5 (2)(16)      
        First lien senior secured loan ($6.6 par due 12/2017)       7/12/2012     6.6     4.9 (2)(16)      
        First lien senior secured loan ($24.3 par due 12/2017)       7/12/2012     24.3     18.0 (2)(16)      
        Series A preferred stock (1,800 shares)         7/12/2012     1.8     (2)      
        Common stock (20,000 shares)         7/12/2012     0.2     (2)      
                        34.9     24.4        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
EcoMotors, Inc.   Engine developer   First lien senior secured loan ($9.4 par due 3/2018)       9/1/2015     9.1     0.1 (2)(16)      
        Warrant to purchase up to 321,888 shares of Series C preferred stock (expires 12/2022)         12/28/2012         (2)      
        Warrant to purchase up to 70,000 shares of Series C preferred stock (expires 2/2025)         2/24/2015         (2)      
                        9.1     0.1        
                                       
ESCP PPG Holdings, LLC(7)   Distributor of new equipment and aftermarket parts to the heavy-duty truck industry   Class A units (3,500,000 units)         12/14/2016     3.5     2.8 (2)      
                                       
Mavis Tire Supply LLC   Auto parts retailer   First lien senior secured loan ($38.5 par due 10/2020)   6.67% (Libor + 5.25%/Q)     7/26/2017     38.5     38.5 (2)(17)      
        First lien senior secured loan ($2.0 par due 10/2020)   6.67% (Libor + 5.25%/Q)     10/18/2017     2.0     2.0 (2)(17)      
        First lien senior secured loan ($179.0 par due 10/2020)   6.67% (Libor + 5.25%/Q)     7/26/2017     179.0     179.0 (2)(17)      
                        219.5     219.5        
                                       
Simpson Performance Products, Inc.   Provider of motorsports safety equipment   First lien senior secured loan ($10.0 par due 2/2020)   9.25% (Libor + 7.59%/Q)     2/20/2015     10.0     10.0 (2)(17)      
        First lien senior secured loan ($18.3 par due 2/2020)   9.25% (Libor + 7.59%/Q)     2/20/2015     18.3     18.3 (3)(17)      
                        28.3     28.3        
                                       
SK SPV IV, LLC   Collision repair site operators   Series A common stock (12,500 units)         8/18/2014     0.6     3.2 (2)      
        Series B common stock (12,500 units)         8/18/2014     0.6     3.2 (2)      
                        1.2     6.4        
                        363.7     352.2     4.96 %
Education                                      
Campus Management Acquisition Corp.(7)   Education software developer   Preferred stock (485,159 shares)         2/8/2008     10.5     11.0 (2)      
                                       
Excelligence Holdings Corp.   Developer, manufacturer and retailer of educational products   First lien senior secured loan ($10.0 par due 4/2023)   7.35% (Libor + 6.00%/Q)     4/17/2017     10.0     9.6 (4)(17)      
                                       
Flinn Scientific, Inc. and WCI-Quantum Holdings, Inc.   Distributor of instructional products, services and resources   First lien senior secured loan ($32.0 par due 10/2020)   6.50% (Libor + 5.00%/Q)     7/26/2017     32.0     32.0 (2)(17)      
        First lien senior secured loan ($38.7 par due 10/2020)   6.37% (Libor + 5.00%/Q)     7/26/2017     38.7     38.7 (2)(17)      
        Series A preferred stock (1,272 shares)         10/24/2014     1.0     1.2 (2)      
                        71.7     71.9        
                                       
Frontline Technologies Group Holding LLC, Frontline Technologies Blocker Buyer, Inc., Frontline Technologies Holdings, LLC and Frontline Technologies Parent, LLC(21)   Provider of human capital management ("HCM") and SaaS-based software solutions to employees and administrators of K-12 school organizations   First lien senior secured loan ($39.6 par due 9/2023)   8.09% (Libor + 6.50%/Q)     9/19/2017     39.1     39.0 (2)(17)      
        Class A preferred units (4,574 units)         9/18/2017     4.6     4.8        
        Class B units (499,050 units)         9/18/2017                
                        43.7     43.8        
                                       
Infilaw Holding, LLC(21)   Operator of for-profit law schools   First lien senior secured revolving loan ($4.5 par due 2/2018)       8/25/2011     3.5     (2)(16)(20)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Instituto de Banca y Comercio, Inc. & Leeds IV Advisors, Inc.(21)   Private school operator   First lien senior secured revolving loan ($11.8 par due 12/2018)   12.50% (Base Rate + 8.00%/Q)     5/18/2017     11.8     11.8 (2)(17)      
        First lien senior secured loan ($3.2 par due 12/2018)   10.50% (Libor + 9.00%/Q)     10/31/2015     3.2     3.2 (2)(17)      
        Senior preferred series A-1 shares (163,902 shares)         10/31/2015     119.4     25.2 (2)      
        Series B preferred stock (1,401,385 shares)         8/5/2010     4.0     (2)      
        Series C preferred stock (1,994,644 shares)         6/7/2010     0.5     (2)      
        Series B preferred stock (348,615 shares)         8/5/2010     1.0     (2)      
        Series C preferred stock (517,942 shares)         6/7/2010     0.1     (2)      
        Common stock (16 shares)         6/7/2010         (2)      
        Common stock (4 shares)         6/7/2010         (2)      
                        140.0     40.2        
                                       
Liaison Acquisition, LLC(21)   Provider of centralized applications services to educational associations   Second lien senior secured loan ($15.0 par due 8/2023)   10.81% (Libor + 9.25%/Q)     2/9/2017     14.7     15.0 (2)(17)      
                                       
PIH Corporation and Primrose Holding Corporation(7)(21)   Franchisor of education-based early childhood centers   First lien senior secured revolving loan ($0.6 par due 12/2018)   6.63% (Libor + 5.25%/Q)     12/13/2013     0.6     0.6 (2)(17)      
        First lien senior secured revolving loan ($0.4 par due 12/2018)   8.75% (Base Rate + 4.25%/Q)     12/13/2013     0.4     0.4 (2)(17)      
        First lien senior secured loan ($1.6 par due 12/2018)   7.07% (Libor + 5.50%/Q)     12/15/2017     1.6     1.6 (2)(17)      
        Common stock (7,227 shares)         1/3/2017     10.7     17.8        
                        13.3     20.4        
                                       
R3 Education Inc., Equinox EIC Partners LLC and Sierra Education Finance Corp.   Medical school operator   Preferred stock (1,977 shares)         7/30/2008     0.5     0.5 (2)      
        Common membership interest (15.76% interest)         9/21/2007     15.8     26.2 (2)      
        Warrant to purchase up to 27,890 shares (expires 11/2019)         12/8/2009         9.1 (2)      
                        16.3     35.8        
Regent Education, Inc.   Provider of software solutions designed to optimize the financial aid and enrollment processes   Warrant to purchase up to 987 shares of common stock (expires 12/2026)         12/23/2016         (2)      
        Warrant to purchase up to 5,393,194 shares of common stock (expires 12/2026)         12/23/2016         (2)      
                                   
                                       
RuffaloCODY, LLC(21)   Provider of student fundraising and enrollment management services   First lien senior secured revolving loan       5/29/2013         (19)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Severin Acquisition, LLC(21)   Provider of student information system software solutions to the K-12 education market   Second lien senior secured loan ($38.7 par due 7/2022)   10.32% (Libor + 8.75%/Q)     2/1/2017     37.9     38.7 (2)(17)      
        Second lien senior secured loan ($3.1 par due 7/2022)   10.57% (Libor + 9.00%/Q)     10/14/2016     3.1     3.1 (17)      
        Second lien senior secured loan ($4.2 par due 7/2022)   10.32% (Libor + 8.75%/Q)     10/28/2015     4.1     4.2 (2)(17)      
        Second lien senior secured loan ($15.0 par due 7/2022)   10.32% (Libor + 8.75%/Q)     7/31/2015     14.8     15.0 (2)(17)      
        Second lien senior secured loan ($3.3 par due 7/2022)   10.82% (Libor + 9.25%/Q)     2/1/2016     3.2     3.3 (2)(17)      
        Second lien senior secured loan ($2.8 par due 7/2022)   10.82% (Libor + 9.25%/Q)     8/8/2016     2.8     2.8 (17)      
        Second lien senior secured loan ($3.1 par due 7/2022)   10.57% (Libor + 9.00%/Q)     1/3/2017     3.1     3.1 (17)      
        Second lien senior secured loan ($5.5 par due 7/2022)   10.32% (Libor + 8.75%/Q)     1/3/2017     5.5     5.5 (2)(17)      
        Second lien senior secured loan ($20.0 par due 7/2022)   10.32% (Libor + 8.75%/Q)     1/3/2017     20.0     20.0 (2)(17)      
        Second lien senior secured loan ($4.4 par due 7/2022)   10.82% (Libor + 9.25%/Q)     1/3/2017     4.4     4.4 (2)(17)      
        Second lien senior secured loan ($2.8 par due 7/2022)   10.82% (Libor + 9.25%/Q)     1/3/2017     2.8     2.8 (17)      
                        101.7     102.9        
                        425.4     350.6     4.94 %
Wholesale Distribution                                      
DFS Holding Company, Inc.   Distributor of maintenance, repair, and operations parts, supplies, and equipment to the foodservice industry   First lien senior secured loan ($4.7 par due 2/2022)   6.69% (Libor + 5.00%/Q)     3/1/2017     4.7     4.6 (2)(17)      
        First lien senior secured loan ($188.7 par due 2/2022)   7.19% (Libor + 5.50%/Q)     7/26/2017     188.7     186.8 (2)(17)      
                        193.4     191.4        
                                       
Flow Solutions Holdings, Inc.   Distributor of high value fluid handling, filtration and flow control products   Second lien senior secured loan ($6.0 par due 10/2018)   10.57% (Libor + 9.00%/Q)     12/16/2014     6.0     6.0 (2)(17)      
        Second lien senior secured loan ($29.5 par due 10/2018)   10.57% (Libor + 9.00%/Q)     12/16/2014     29.5     29.5 (2)(17)      
                        35.5     35.5        
                                       
KHC Holdings, Inc. and Kele Holdco, Inc.(21)   Catalog-based distribution services provider for building automation systems   First lien senior secured revolving loan ($0.7 par due 10/2020)   5.80% (Libor + 4.25%/Q)     1/3/2017     0.7     0.7 (2)(17)      
        First lien senior secured loan ($66.2 par due 10/2022)   7.69% (Libor + 6.00%/Q)     1/3/2017     66.2     66.2 (3)(17)      
        Common stock (30,000 shares)         1/3/2017     3.1     3.1        
                        70.0     70.0        
                        298.9     296.9     4.18 %
Oil and Gas                                      
Moss Creek Resources, LLC   Exploration and production company   Senior subordinated loan ($30.0 par due 4/2022)   9.50% (Libor + 8.00%/Q)     5/5/2017     29.7     30.0 (2)(17)      
                                       
Penn Virginia Holding Corp.   Exploration and production company   Second lien senior secured loan ($90.1 par due 9/2022)   8.57% (Libor + 7.00%/Q)     9/28/2017     90.1     88.3 (2)(17)      
                                       
Petroflow Energy Corporation and TexOak Petro Holdings LLC(7)   Oil and gas exploration and production company   First lien senior secured loan ($12.8 par due 6/2019)   3.36% (Libor + 2.00%/Q)     6/29/2016     11.7     12.4 (2)(17)      
        Second lien senior secured loan ($24.7 par due 12/2019)       6/29/2016     21.9     (2)(16)      
        Common units (202,000 units)         6/29/2016     11.1            
                        44.7     12.4        
                                     

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Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
VPROP Operating, LLC and Vista Proppants and Logistics, LLC   Sand based proppant producer and distributor to the oil and natural gas industry   First lien senior secured loan ($28.2 par due 8/2021)   10.98% (Libor + 9.50%/Q)     8/1/2017     28.1     28.2 (2)(17)      
        First lien senior secured loan ($35.3 par due 8/2021)   10.74% (Libor + 8.50% Cash, 1.00% PIK/Q)     11/9/2017     35.3     35.3 (2)(17)      
        First lien senior secured loan ($15.2 par due 3/2021)   10.98% (Libor + 8.50% Cash, 1.00% PIK/Q)     3/1/2017     15.2     15.2 (2)(17)      
        First lien senior secured loan ($75.5 par due 3/2021)   10.98% (Libor + 8.50% Cash, 1.00% PIK/Q)     3/1/2017     75.5     75.5 (3)(17)      
        Common units (997,864 units)         11/9/2017     9.7     9.7 (2)      
                        163.8     163.9        
                        328.3     294.6     4.15 %
Containers and Packaging                                      
GS Pretium Holdings, Inc.   Manufacturer and supplier of high performance plastic containers   Common stock (500,000 shares)         6/2/2014     0.5     0.8 (2)      
                                       
ICSH Parent, Inc. and Vulcan Container Services Holdings, Inc.   Industrial container manufacturer, reconditioner and servicer   Second lien senior secured loan ($63.6 par due 4/2025)   9.38% (Libor + 8.00%/Q)     4/28/2017     62.9     63.6 (2)(17)      
        Series A common stock (24,900 shares)         4/28/2017     2.5     3.3 (2)      
                        65.4     66.9        
                                       
LBP Intermediate Holdings LLC(21)   Manufacturer of paper and corrugated foodservice packaging   First lien senior secured revolving loan       7/10/2015         (19)      
        First lien senior secured loan ($11.8 par due 7/2020)   7.19% (Libor + 5.50%/Q)     7/10/2015     11.8     11.8 (3)(17)      
        First lien senior secured loan ($5.0 par due 7/2020)   7.19% (Libor + 5.50%/Q)     7/10/2015     5.0     5.0 (4)(17)      
                        16.8     16.8        
                                       
Microstar Logistics LLC, Microstar Global Asset Management LLC, and MStar Holding Corporation   Keg management solutions provider   Second lien senior secured loan ($78.5 par due 12/2018)   9.05% (Libor + 7.50%/Q)     12/14/2012     78.5     78.5 (2)(17)      
        Second lien senior secured loan ($54.0 par due 12/2018)   9.05% (Libor + 7.50%/Q)     12/14/2012     54.0     54.0 (3)(17)      
        Second lien senior secured loan ($10.0 par due 12/2018)   9.05% (Libor + 7.50%/Q)     12/14/2012     10.0     10.0 (4)(17)      
        Common stock (50,000 shares)         12/14/2012     4.0     6.8 (2)      
                        146.5     149.3        
                                       
NSI Holdings, Inc.(7)   Manufacturer of plastic containers for the wholesale nursery industry   Series A preferred stock (2,192 shares)         1/3/2017                
                                       
Ranpak Corp.   Manufacturer and marketer of paper-based protective packaging systems and materials   Second lien senior secured loan ($13.3 par due 10/2022)   8.75% (Libor + 7.25%/Q)     1/3/2017     12.8     13.3 (2)(17)      
                        242.0     247.1     3.48 %
Environmental Services                                      
MPH Energy Holdings, LP   Operator of municipal recycling facilities   Limited partnership interest (3.13% interest)         1/8/2014         (2)      
                                       
RE Community Holdings GP, LLC and RE Community Holdings, LP   Operator of municipal recycling facilities   Limited partnership interest (2.86% interest)         3/1/2011         (2)      
        Limited partnership interest (2.49% interest)         3/1/2011         (2)      
                                   

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Soil Safe, Inc. and Soil Safe Acquisition Corp.(8)(21)   Provider of soil treatment, recycling and placement services   First lien senior secured revolving loan       1/3/2017         (19)      
        First lien senior secured loan ($22.0 par due 1/2020)   8.00% (Libor + 6.25%/Q)     1/3/2017     22.0     22.0 (2)(17)      
        Second lien senior secured loan ($12.7 par due 6/2020)   10.75% (Libor + 7.75%/Q)     1/3/2017     12.7     12.7 (2)(17)      
        Senior subordinated loan ($36.7 par due 12/2020)   16.50% PIK     1/3/2017     36.7     36.7 (2)      
        Senior subordinated loan ($31.5 par due 12/2020)   14.50% PIK     1/3/2017     31.5     31.5 (2)      
        Senior subordinated loan ($30.5 par due 12/2020)       1/3/2017     11.5     4.0 (16)      
        Common stock (810 shares)         1/3/2017                
                        114.4     106.9        
                                       
Storm UK Holdco Limited and Storm US Holdco Inc.(9)(21)   Provider of water infrastructure software solutions for municipalities / utilities and engineering consulting firms   First lien senior secured revolving loan ($0.1 par due 5/2022)   9.00% (Base Rate + 4.50%/Q)     5/5/2017     0.1     0.1 (2)(17)      
        First lien senior secured loan ($1.6 par due 5/2023)   6.89% (Libor + 5.50%/Q)     5/5/2017     1.6     1.5 (2)(17)      
                        1.7     1.6        
                                       
Waste Pro USA, Inc   Waste management services   Second lien senior secured loan ($75.2 par due 10/2020)   9.05% (Libor + 7.50%/Q)     10/15/2014     75.2     75.2 (3)(17)      
                        191.3     183.7     2.59 %
Printing, Publishing and Media                                      
Connoisseur Media, LLC   Owner and operator of radio stations   First lien senior secured loan ($21.0 par due 6/2019)   7.74% (Libor + 6.38%/Q)     7/26/2017     21.0     20.8 (2)(17)      
        First lien senior secured loan ($0.1 par due 6/2019)   9.88% (Base Rate + 5.38%/Q)     7/26/2017     0.1     0.1 (2)(17)      
        First lien senior secured loan ($0.7 par due 6/2019)   8.07% (Libor + 6.38%/Q)     7/26/2017     0.7     0.6 (2)(17)      
        First lien senior secured loan ($0.3 par due 6/2019)   8.07% (Libor + 6.38%/Q)     7/26/2017     0.3     0.3 (4)(17)      
        First lien senior secured loan ($41.4 par due 6/2019)   7.76% (Libor + 6.38%/Q)     7/26/2017     41.4     41.0 (2)(17)      
        First lien senior secured loan ($17.8 par due 6/2019)   7.76% (Libor + 6.38%/Q)     7/26/2017     17.8     17.6 (4)(17)      
                        81.3     80.4        
Earthcolor Group, LLC   Printing management services   Limited liability company interests (9.30%)         5/18/2012                
                                       
EDS Group(8)(9)   Provider of print and digital services   Common stock (2,432,750 shares)         1/3/2017         2.7        
                                       
Roark-Money Mailer LLC   Marketer, advertiser and distributor of coupons in the mail industry   Membership units (35,000 units)         1/3/2017                
                                       
The Teaching Company Holdings, Inc.   Education publications provider   Preferred stock (10,663 shares)         9/29/2006     1.1     2.4 (2)      
        Common stock (15,393 shares)         9/29/2006         (2)      
                        1.1     2.4        
                        82.4     85.5     1.20 %
Chemicals                                      
AMZ Holding Corp.(21)   Specialty chemicals manufacturer   First lien senior secured loan ($12.2 par due 6/2022)   6.57% (Libor + 5.00%/Q)     6/27/2017     12.2     12.2 (4)(17)      
                                       
Genomatica, Inc.   Developer of a biotechnology platform for the production of chemical products   Warrant to purchase 322,422 shares of Series D preferred stock (expires 3/2023)         3/28/2013         (2)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
K2 Pure Solutions Nocal, L.P.(21)   Chemical producer   First lien senior secured revolving loan ($1.5 par due 2/2021)   8.70% (Libor + 7.13%/Q)     8/19/2013     1.5     1.5 (2)(17)      
        First lien senior secured loan ($40.0 par due 2/2021)   7.57% (Libor + 6.00%/Q)     8/19/2013     40.0     40.0 (3)(17)      
        First lien senior secured loan ($13.0 par due 2/2021)   7.57% (Libor + 6.00%/Q)     8/19/2013     13.0     13.0 (4)(17)      
                        54.5     54.5        
                        66.7     66.7     0.94 %
Retail                                      
Fashion Holding Luxembourg SCA (Modacin/Camaeiu)(8)(9)   Retailer of women's clothing   Preferred stock (241,776,675 shares)         1/3/2017                
                                       
Galls, LLC   Distributor of public safety, private security and defense products in the United States   Second lien senior secured loan ($2.0 par due 8/2021)   9.71% (Libor + 8.25%/Q)     8/25/2017     2.0     2.0 (2)(17)      
        Second lien senior secured loan ($7.1 par due 8/2021)   9.85% (Libor + 8.25%/Q)     8/25/2017     7.1     7.1 (2)(17)      
        Second lien senior secured loan ($1.9 par due 8/2021)   9.94% (Libor + 8.25%/Q)     8/25/2017     1.9     1.9 (2)(17)      
        Second lien senior secured loan ($14.3 par due 8/2021)   9.94% (Libor + 8.25%/Q)     1/3/2017     14.3     14.3 (2)(17)      
        Second lien senior secured loan ($26.0 par due 8/2021)   9.94% (Libor + 8.25%/Q)     1/3/2017     26.0     26.0 (2)(17)      
                        51.3     51.3        
                                       
Paper Source, Inc. and Pine Holdings, Inc.(21)   Retailer of fine and artisanal paper products   First lien senior secured loan ($9.6 par due 9/2019)   7.94% (Libor + 6.25%/Q)     9/23/2013     9.6     9.4 (4)(17)      
        Class A common stock (36,364 shares)         9/23/2013     6.0     3.1 (2)      
                        15.6     12.5        
                                       
Things Remembered, Inc. and TRM Holdco Corp.(7)(21)   Personalized gifts retailer   First lien senior secured loan ($12.3 par due 3/2020)       8/30/2016     10.5     1.5 (2)(16)      
        Common stock (10,631,940 shares)         8/30/2016     6.1     (2)      
                        16.6     1.5        
                        83.5     65.3     0.92 %
Aerospace and Defense                                      
Cadence Aerospace, LLC(21)   Aerospace precision components manufacturer   First lien senior secured revolving loan ($0.7 par due 11/2022)   7.91% (Libor + 6.50%/Q)     11/14/2017     0.7     0.7 (2)(17)(20)      
        First lien senior secured loan ($32.5 par due 11/2023)   7.91% (Libor + 6.50%/Q)     11/14/2017     32.2     32.2 (2)(17)      
                        32.9     32.9        
                                       
Jazz Acquisition, Inc.   Designer and distributor of aftermarket replacement components to the commercial airlines industry   Second lien senior secured loan ($25.0 par due 6/2022)   8.44% (Libor + 6.75%/Q)     1/3/2017     19.8     22.5 (2)(17)      
                        52.7     55.4     0.78 %
Health Clubs                                      
Athletic Club Holdings, Inc.   Premier health club operator   First lien senior secured loan ($35.0 par due 10/2020)   10.07% (Libor + 8.50%/Q)     10/11/2007     35.0     35.0 (3)(17)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
CFW Co-Invest, L.P., NCP Curves, L.P. and Curves International Holdings, Inc.   Health club franchisor   Limited partnership interest (4,152,165 shares)         7/31/2012     4.2     4.4 (2)      
        Limited partnership interest (2,218,235 shares)         7/31/2012     2.2     9.7 (2)(9)      
        Common stock (1,680 shares)         11/12/2014         (2)(9)      
                        6.4     14.1        
                                       
Movati Athletic (Group) Inc.(9)(21)   Premier health club operator   First lien senior secured loan ($0.3 par due 10/2022)   5.90% (Libor + 4.50%/Q)     10/5/2017     0.3     0.3 (2)(17)      
        First lien senior secured loan ($3.1 par due 10/2022)   5.91% (Libor + 4.50%/Q)     10/5/2017     3.0     3.0 (2)(17)      
                        3.3     3.3        
                        44.7     52.4     0.74 %
Farming and Agriculture                                      
QC Supply, LLC(21)   Specialty distributor and solutions provider to the swine and poultry markets   First lien senior secured revolving loan ($4.0 par due 12/2021)   7.57% (Libor + 6.00%/Q)     12/29/2016     4.0     3.9 (2)(17)      
        First lien senior secured loan ($2.5 par due 12/2022)   7.57% (Libor + 6.00%/Q)     12/29/2016     2.5     2.4 (2)(17)      
        First lien senior secured loan ($11.2 par due 12/2022)   7.57% (Libor + 6.00%/Q)     12/29/2016     11.2     11.0 (2)(17)      
        First lien senior secured loan ($14.9 par due 12/2022)   7.57% (Libor + 6.00%/Q)     12/29/2016     14.9     14.6 (4)(17)      
                        32.6     31.9        
                        32.6     31.9     0.45 %
Hotel Services                                      
Pyramid Management Advisors, LLC and Pyramid Investors, LLC   Hotel Operator   First lien senior secured loan ($3.0 par due 7/2021)   8.69% (Libor + 7.00%/Q)     7/15/2016     3.0     3.0 (2)(17)      
        First lien senior secured loan ($19.5 par due 7/2021)   11.37% (Libor + 10.06%/Q)     7/15/2016     19.5     19.5 (3)(17)      
        Membership units (996,833 units)         7/15/2016     1.0     0.8 (2)      
                        23.5     23.3        
                        23.5     23.3     0.33 %
Computers and Electronics                                      
Everspin Technologies, Inc.   Designer and manufacturer of computer memory solutions   Warrant to purchase up to 18,461 shares of common stock (expires 10/2026)         6/5/2015     0.4     (5)(24)      
                                       
Imaging Business Machines, L.L.C. and Scanner Holdings Corporation(8)   Provider of high-speed intelligent document scanning hardware and software   Senior subordinated loan ($8.3 par due 6/2022)   14.00%     1/3/2017     8.1     8.3 (2)      
        Senior subordinated loan ($8.3 par due 6/2022)   14.00%     1/3/2017     8.1     8.3 (2)      
        Series A preferred stock (66,424,135 shares)         1/3/2017         4.5        
        Class A common stock (33,173 shares)         1/3/2017                
        Class B common stock (134,214 shares)         1/3/2017                
                        16.2     21.1        
                        16.6     21.1     0.30 %

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Company(1)
  Business Description   Investment   Interest(6)(12)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Telecommunications                                      
Adaptive Mobile Security Limited(9)   Developer of security software for mobile communications networks   First lien senior secured loan ($0.9 par due 10/2018)   12.00% (EURIBOR + 8.00% Cash, 2.00% PIK/M)     10/17/2016     0.8     0.8 (2)(17)      
        First lien senior secured loan ($0.8 par due 7/2018)   12.00% (EURIBOR + 8.00% Cash, 2.00% PIK/M)     1/16/2015     0.7     0.7 (2)(17)      
        First lien senior secured loan ($0.3 par due 10/2018)   12.00% (EURIBOR + 8.00% Cash, 2.00% PIK/M)     1/16/2015     0.3     0.3 (2)(17)      
                        1.8     1.8        
                                       
CHL, LTD.   Repair and service solutions provider for cable, satellite and telecommunications based service providers   Warrant to purchase up to 120,000 shares of Series A common stock (expires 5/2020)         1/3/2017                
        Warrant to purchase up to 280,000 shares of Series B common stock (expires 5/2020)         1/3/2017                
        Warrant to purchase up to 80,000 shares of Series C common stock (expires 5/2020)         1/3/2017                
                                   
                                       
LTG Acquisition, Inc.   Designer and manufacturer of display, lighting and passenger communication systems for mass transportation markets   Class A membership units (5,000 units)         1/3/2017     5.1     1.7        
                                       
Startec Equity, LLC(8)   Communication services   Member interest         4/1/2010                
                        6.9     3.5     0.05 %
Commercial Real Estate Financial                                      
ACAS Real Estate Holdings Corporation(8)   Real estate holding company   Common stock (1,000 shares)         1/3/2017     2.6     2.1        
                                       
NECCO Realty Investments LLC(8)   Real estate holding company   Membership units (7,450 units)         1/3/2017                
                        2.6     2.1     0.03 %
Housing and Building Materials                                      
Halex Holdings, Inc.(8)(21)   Manufacturer of flooring installation products   First lien senior secured revolving loan ($1.1 par due 12/2018)         1/24/2017     1.1            
        Common stock (51,853 shares)         1/3/2017                
                        1.1            
                        1.1         %
Total Investments                     $ 11,904.5   $ 11,840.6     166.83 %

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Derivative Instruments

Foreign currency forward contracts

Description
  Notional
Amount
to be
Purchased
  Notional
Amount
to be Sold
  Counterparty   Settlement Date   Unrealized
Appreciation /
(Depreciation)
 

Foreign currency forward contract

  $ 3   CAD 4   Bank of Montreal   January 4, 2018   $  

Foreign currency forward contract

  $ 8   CAD 10   Bank of Montreal   January 16, 2018      

Foreign currency forward contract

  $ 81   CAD 103   Bank of Montreal   February 16, 2018     (1 )

Foreign currency forward contract

  $ 18   15   Bank of Montreal   January 16, 2018      

Foreign currency forward contract

  $ 9   8   Bank of Montreal   February 15, 2018      

Foreign currency forward contract

  $ 2   2   Bank of Montreal   March 15, 2018      

Foreign currency forward contract

  $ 90   £ 68   Bank of Montreal   February 15, 2018     (2 )

Foreign currency forward contract

  $ 12   £ 9   Bank of Montreal   February 16, 2018      

Total

                      $ (3 )

Interest rate swap

Description
  Payment Terms   Counterparty   Maturity Date   Notional
Amount
  Value   Upfront
Payments/
Receipts
  Unrealized
Appreciation /
(Depreciation)
 

Interest rate swap

  Pay Fixed 2.0642%   Receive Floating One-Month LIBOR of 1.50%   Bank of Montreal   January 4, 2021   $ 395   $ (1 ) $   $ (1 )

Total

                                    $ (1 )

(1)
Other than the Company's investments listed in footnote 8 below (subject to the limitations set forth therein), the Company does not "Control" any of its portfolio companies, for the purposes of the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the "Investment Company Act"). In general, under the Investment Company Act, the Company would "Control" a portfolio company if the Company owned more than 25% of its outstanding voting securities (i.e., securities with the right to elect directors) and/or had the power to exercise control over the management or policies of such portfolio company. All of the Company's portfolio company investments, which as of December 31, 2017 represented 167% of the Company's net assets or 96% of the Company's total assets, are subject to legal restrictions on sales.

(2)
These assets are pledged as collateral for the Revolving Credit Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company's obligations under the Revolving Credit Facility (see Note 5 to the consolidated financial statements).

(3)
These assets are owned by the Company's consolidated subsidiary Ares Capital CP Funding LLC ("Ares Capital CP"), are pledged as collateral for the Revolving Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than Ares Capital CP's obligations under the Revolving Funding Facility (see Note 5 to the consolidated financial statements).

(4)
These assets are owned by the Company's consolidated subsidiary Ares Capital JB Funding LLC ("ACJB"), are pledged as collateral for the SMBC Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than ACJB's obligations under the SMBC Funding Facility (see Note 5 to the consolidated financial statements).

(5)
These assets are owned by the Company's consolidated subsidiary Ares Venture Finance, L.P. ("AVF LP"), are pledged as collateral for the SBA-guaranteed debentures (the "SBA Debentures") and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than AVF LP's obligations (see Note 5 to the consolidated financial statements). AVF LP operates as a Small Business Investment Company ("SBIC") under the provisions of Section 301(c) of the Small Business Investment Act of 1958, as amended.

(6)
Investments without an interest rate are non-income producing.

(7)
As defined in the Investment Company Act, the Company is deemed to be an "Affiliated Person" because it owns 5% or more of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company (including through a management

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    agreement). Transactions as of and during the year ended December 31, 2017 in which the issuer was an Affiliated Person (but not a portfolio company that the Company is deemed to Control) are as follows:

 
  For the year ended December 31, 2017   As of
December 31,
2017
 
(in millions)
Company
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service
fees
  Dividend
income
  Other
income
  Net
realized
gains
(losses)
  Net
unrealized
gains
(losses)
  Fair
Value
 

Campus Management Acquisition Corp. 

  $   $   $   $   $   $   $   $   $ 0.7   $ 11.0  

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC

  $ 14.0   $ 0.8   $   $ 1.1   $ 0.1   $   $ 0.2   $   $ 1.0   $ 28.5  

ESCP PPG Holdings, LLC

  $   $   $   $   $   $   $   $   $ (0.9 ) $ 2.8  

Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.

  $ 3.0   $ 3.0   $   $   $   $   $   $   $   $  

Ioxus, Inc

  $   $   $   $ 1.3   $   $   $   $   $ (0.1 ) $ 11.2  

Multi-Ad Services, Inc.

  $   $   $   $   $   $   $   $ 0.1   $   $  

NSI Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Petroflow Energy Corporation and TexOak Petro Holdings LLC

  $   $ 2.6   $ 1.8   $ 0.4   $   $   $   $ 0.2   $ (4.8 ) $ 12.4  

PIH Corporation and Primrose Holding Corporation

  $ 17.0   $ 6.2   $   $   $   $ 1.4   $   $   $ 7.0   $ 20.4  

Shock Doctor, Inc. and Shock Doctor Holdings, LLC

  $   $   $   $ 10.7   $   $   $ 0.1   $   $ (9.1 ) $ 86.1  

Things Remembered, Inc. and TRM Holdco Corp.

  $ 5.1   $ 5.0   $ 0.3   $ 0.1   $   $   $ 0.1   $   $ (1.9 ) $ 1.5  

UL Holding Co., LLC

  $   $   $   $ 3.3   $   $   $   $   $ 6.3   $ 42.4  

  $ 39.1   $ 17.6   $ 2.1   $ 16.9   $ 0.1   $ 1.4   $ 0.4   $ 0.3   $ (1.8 ) $ 216.3  
(8)
As defined in the Investment Company Act, the Company is deemed to be both an "Affiliated Person" and "Control" this portfolio company because it owns more than 25% of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company

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    (including through a management agreement). Transactions as of and during the year ended December 31, 2017 in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to Control are as follows:

 
  For the year ended December 31, 2017   As of
December 31,
2017
 
(in millions)
Company
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service
fees
  Dividend
income
  Other
income
  Net
realized
gains
(losses)
  Net
unrealized
gains
(losses)
  Fair
Value
 

10th Street, LLC and New 10th Street, LLC

  $   $ 53.3   $ 0.6   $ 2.0   $   $   $   $ 34.5   $ (34.7 ) $  

ACAS 2007-1 CLO

  $   $   $   $   $   $   $   $   $   $  

ACAS Equity Holdings Corporation

  $ 0.5   $   $   $   $   $   $   $   $ (0.1 ) $ 0.4  

ACAS Real Estate Holdings Corporation

  $ 2.6   $   $   $   $   $   $   $   $ (0.5 ) $ 2.1  

ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.

  $   $   $   $ 0.6   $   $   $ 0.1   $   $ (15.9 ) $ 16.0  

Alcami Holdings, LLC

  $ 273.1   $ 5.5   $ 0.3   $ 29.8   $   $   $ 2.1   $   $ 166.8   $ 442.3  

AllBridge Financial, LLC

  $   $   $   $   $   $ 0.4   $   $   $ (0.4 ) $  

Ares IIIR/IVR CLO Ltd.

  $   $ 5.2   $   $ 0.4   $   $   $   $ 0.5   $ 0.1   $ 0.1  

Bellotto Holdings Limited

  $ 193.6   $ 193.6   $   $   $   $   $   $ 58.1   $   $  

Callidus Capital Corporation

  $   $   $   $   $   $   $   $   $   $ 1.7  

Ciena Capital LLC

  $   $   $ 10.0   $ 0.8   $   $   $   $   $ 10.6   $ 32.3  

CoLTS 2005-1

  $   $   $   $   $   $   $   $   $   $  

CoLTS 2005-2

  $   $   $   $   $   $   $   $   $   $  

Columbo Midco Limited, Columbo Bidco Limited and Columbo Topco Limited

  $ 27.9   $   $   $   $   $   $   $   $ 12.7   $ 40.6  

Community Education Centers, Inc. and CEC Parent Holdings LLC

  $   $ 36.2   $ 38.1   $ 1.2   $   $ 8.4   $ 0.1   $ 24.3   $ (10.9 ) $  

Competitor Group, Inc., Calera XVI, LLC and Champion Parent Corporation

  $ 0.5   $ 18.6   $ 42.8   $   $   $   $   $ (20.1 ) $ 17.3   $ 0.2  

CSHM LLC

  $   $   $   $   $   $   $   $   $   $  

EDS Group

  $ 11.8   $ 12.1   $   $ 0.4   $   $   $   $ 3.3   $ 2.7   $ 2.7  

ETG Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

European Capital Private Debt LP

  $ 97.9   $ 0.3   $ 97.7   $   $   $   $   $ 1.1   $   $  

European Capital UK SME Debt LP

  $ 46.8   $ 4.8   $ 0.8   $   $   $   $   $ 0.1   $ 0.6   $ 41.7  

Fashion Holding Luxembourg SCA (Modacin/Camaeiu)

  $   $   $   $   $   $   $   $   $   $  

FPI Holding Corporation

  $ 0.4   $   $   $   $   $   $   $   $ (1.0 ) $ 0.4  

Garden Fresh Restaurant Corp. and GFRC Holdings LLC

  $ 14.6   $ 12.3   $ 18.9   $ 3.6   $   $   $ 0.2   $   $ 2.0   $ 25.0  

Halex Holdings, Inc.

  $ 1.1   $   $   $   $   $   $   $ 2.4   $ (2.0 ) $  

HALT Medical, Inc.

  $ 0.7   $   $ 0.6   $   $   $   $   $   $   $  

Hard 8 Games, LLC

  $ 9.4   $   $ 9.4   $   $   $   $   $ 4.6   $   $  

HCI Equity, LLC

  $   $   $   $   $   $   $   $   $   $ 0.1  

Imaging Business Machines, L.L.C. and Scanner Holdings Corporation

  $ 16.1   $   $   $ 2.4   $   $   $ 0.6   $   $ 5.0   $ 21.1  

Ivy Hill Asset Management, L.P.

  $ 228.6   $ 155.5   $   $   $   $ 40.0   $   $   $ 12.8   $ 315.1  

LLSC Holdings Corporation (dba Lawrence Merchandising Services)

  $ 19.2   $   $   $   $   $   $ 0.2   $   $ (1.0 ) $ 18.2  

Miles 33 (Finance) Limited

  $ 15.2   $ 1.5   $ 0.6   $ 2.0   $   $   $   $ 0.2   $ 3.9   $ 17.9  

Montgomery Lane, LLC and Montgomery Lane, Ltd.

  $ 2.2   $ 2.3   $   $   $   $   $   $ 1.1   $ 0.6   $ 0.6  

MVL Group, Inc.

  $   $ 0.2   $   $   $   $   $   $ 0.1   $   $  

Navisun LLC and Navisun Holdings LLC

  $ 2.9   $   $   $   $   $   $   $   $   $ 2.9  

NECCO Holdings, Inc.

  $ 60.4   $ 41.9   $ 7.1   $   $   $   $   $   $ (1.3 ) $ 10.6  

NECCO Realty Investments LLC

  $ 32.7   $ 27.4   $ 6.4   $ 1.2   $   $   $   $ 13.0   $   $  

Orion Foods, LLC

  $   $   $   $   $   $   $   $   $   $ 0.5  

Pillar Processing LLC and PHL Investors, Inc.

  $   $   $   $   $   $   $   $   $   $  

Rug Doctor, LLC and RD Holdco Inc.

  $ 30.9   $   $   $ 1.9   $   $   $   $   $ (3.2 ) $ 27.7  

S Toys Holdings LLC (fka The Step2 Company, LLC)

  $   $   $   $   $   $   $   $ 6.8   $ (5.7 ) $ 0.5  

Senior Direct Lending Program, LLC

  $ 221.4   $ 2.0   $ 2.1   $ 52.3   $ 9.1   $   $ 1.5   $   $   $ 487.1  

Senior Secured Loan Fund LLC

  $   $ 1,938.4   $   $ 69.3   $ 0.9   $   $ 4.5   $ (17.5 ) $ 24.2   $  

Soil Safe, Inc. and Soil Safe Acquisition Corp.

  $ 110.6   $ 4.2   $ 1.0   $ 13.0   $   $   $ 0.1   $   $ (7.6 ) $ 106.9  

Startec Equity, LLC

  $   $   $   $   $   $   $   $   $   $  

The Greeley Company, Inc. and HCP Acquisition Holdings, LLC

  $   $   $ 12.8   $   $   $   $   $ (12.3 ) $ 12.4   $  

  $ 1,421.1   $ 2,515.3   $ 249.2   $ 180.9   $ 10.0   $ 48.8   $ 9.4   $ 100.2   $ 187.4   $ 1,614.7  

*
Together with Varagon Capital Partners ("Varagon") and its clients, the Company has co-invested through the Senior Direct Lending Program LLC (d/b/a the "Senior Direct Lending Program" or the "SDLP"). The SDLP has been capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of the Company and Varagon (with approval from a representative of each required); therefore, although the Company owns more than 25% of the voting securities of the SDLP, the Company does not believe that it has control over the SDLP (for purposes of the Investment Company Act or otherwise) because, among other things, these "voting securities" do not afford the Company the right to elect directors of the SDLP or any other special rights (see Note 4 to the consolidated financial statements).

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(9)
Non-U.S. company or principal place of business outside the U.S. and as a result is not a qualifying asset under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of the Company's total assets. Pursuant to Section 55(a) of the Investment Company Act, 12% of the Company's total assets are represented by investments at fair value and other assets that are considered "non-qualifying assets" as of December 31, 2017.

(10)
Exception from the definition of investment company under Section 3(c) of the Investment Company Act and as a result is not a qualifying asset under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of the Company's total assets.

(11)
Variable rate loans to the Company's portfolio companies bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate ("LIBOR") or an alternate base rate (commonly based on the Federal Funds Rate or the Prime Rate), at the borrower's option, which reset annually (A), semi-annually (S), quarterly (Q), bi-monthly (B), monthly (M) or daily (D). For each such loan, the Company has provided the interest rate in effect on the date presented.

(12)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 1.75% on $63 in aggregate principal amount of a "first out" tranche of the portfolio company's senior term debt previously syndicated by the Company into "first out" and "last out" tranches, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(13)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on $73 in aggregate principal amount of a "first out" tranche of the portfolio company's first lien senior secured loans, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(14)
The Company sold a participating interest of approximately $9 in aggregate principal amount of the portfolio company's second lien senior secured term loan as a "first out" tranche. As the transaction did not qualify as a "true sale" in accordance with U.S. generally accepted accounting principles, the Company recorded a corresponding $9 secured borrowing included in "accounts payable and other liabilities" in the accompanying consolidated balance sheet."

(15)
The Company is entitled to receive a fixed fee upon the occurrence of certain events as defined in the credit agreement governing the Company's debt investment in the portfolio company. The fair value of such fee is included in the fair value of the debt investment.

(16)
Loan was on non-accrual status as of December 31, 2017.

(17)
Loan includes interest rate floor feature.

(18)
In addition to the interest earned based on the stated contractual interest rate of this security, the certificates entitle the holders thereof to receive a portion of the excess cash flow from the SDLP's loan portfolio, after expenses, which may result in a return to the Company greater than the contractual stated interest rate.

(19)
As of December 31, 2017, no amounts were funded by the Company under this first lien senior secured revolving loan; however, there were letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 to the consolidated financial statements for further information on letters of credit commitments related to certain portfolio companies.

(20)
As of December 31, 2017, in addition to the amounts funded by the Company under this first lien senior secured revolving loan, there were also letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 to the consolidated financial statements for further information on letters of credit commitments related to certain portfolio companies.

(21)
As of December 31, 2017, the Company had the following commitments to fund various revolving and delayed draw senior secured and subordinated loans, including commitments to issue letters of credit through a financial intermediary on behalf of certain portfolio companies. Such commitments are subject to the satisfaction of certain conditions set forth in the documents governing these loans and letters of credit and there can be no assurance that such conditions will be satisfied. See Note 7 to the consolidated financial statements for further information on revolving and delayed draw loan commitments, including commitments to issue letters of credit, related to certain portfolio companies.
(in millions)
Portfolio Company
  Total revolving
and delayed
draw loan
commitments
  Less: drawn
commitments
  Total
undrawn
commitments
  Less:
commitments
substantially at
discretion of
the Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

A.U.L. Corp. 

  $ 1.3   $ (0.4 ) $ 0.9   $   $   $ 0.9  

Accruent, LLC, Accruent Holding, LLC and Athena Parent, Inc.

    9.9     (0.7 )   9.2             9.2  

Achilles Acquisition LLC

    1.1         1.1             1.1  

ADCS Billings Intermediate Holdings, LLC

    5.0         5.0             5.0  

ADF Pizza I LLC

    1.3         1.3             1.3  

ADG, LLC

    13.7     (11.5 )   2.2             2.2  

Alcami Holdings, LLC

    30.0     (25.6 )   4.4             4.4  

American Academy Holdings, LLC

    7.0     (0.9 )   6.1             6.1  

AMZ Holding Corp.

    3.4         3.4             3.4  

Bambino CI Inc.

    9.6     (1.1 )   8.5             8.5  

Benihana, Inc.

    3.2     (3.1 )   0.1             0.1  

Cadence Aerospace, LLC

    14.3     (1.5 )   12.8             12.8  

CCS Intermediate Holdings, LLC and CCS Group Holdings, LLC

    7.5     (6.4 )   1.1             1.1  

Chariot Acquisition, LLC

    1.0         1.0             1.0  

Chesapeake Research Review, LLC

    5.8     (0.6 )   5.2             5.2  

Ciena Capital LLC

    20.0     (14.0 )   6.0     (6.0 )        

Clearwater Analytics, LLC

    5.0     (0.5 )   4.5             4.5  

Command Alkon Incorporated

    3.3     (1.6 )   1.7             1.7  

Component Hardware Group, Inc

    3.7     (1.9 )   1.8             1.8  

Cozzini Bros., Inc. and BH-Sharp Holdings LP

    16.0         16.0             16.0  

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(in millions)
Portfolio Company
  Total revolving
and delayed
draw loan
commitments
  Less: drawn
commitments
  Total
undrawn
commitments
  Less:
commitments
substantially at
discretion of
the Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC

    5.0     (2.6 )   2.4             2.4  

CST Buyer Company

    4.2         4.2             4.2  

D4C Dental Brands, Inc.

    5.0         5.0             5.0  

DCA Investment Holding, LLC

    5.8     (0.1 )   5.7             5.7  

DecoPac, Inc.

    8.1     (2.6 )   5.5             5.5  

DFC Global Facility Borrower II LLC

    40.0         40.0             40.0  

Dorner Holding Corp.

    3.3     (1.3 )   2.0             2.0  

DRB Holdings, LLC

    9.9         9.9             9.9  

DTI Holdco, Inc. and OPE DTI Holdings, Inc.

    8.8         8.8             8.8  

Eckler Industries, Inc.

    4.0     (2.0 )   2.0     (2.0 )        

Emergency Communications Network, LLC

    6.5         6.5             6.5  

Emerus Holdings, Inc.

    2.0     (0.3 )   1.7             1.7  

EN Engineering, LLC

    5.0     (1.2 )   3.8             3.8  

Entertainment Partners, LLC and Entertainment Partners Canada Inc.

    28.0         28.0             28.0  

Foundation Risk Partners, Corp.

    19.9         19.9             19.9  

FPI Holding Corporation

    2.6         2.6             2.6  

Frontline Technologies Group Holding LLC

    8.4         8.4             8.4  

FWR Holding Corporation

    3.3     (0.3 )   3.0             3.0  

Garden Fresh Restaurant Corp.

    7.5     (2.9 )   4.6             4.6  

Gentle Communications, LLC

    5.0         5.0             5.0  

Global Franchise Group, LLC

    1.2         1.2             1.2  

GraphPAD Software, LLC

    1.1     (0.6 )   0.5             0.5  

GTCR-Ultra Acquisition, Inc. and GTCR-Ultra Holdings, LLC

    2.0         2.0             2.0  

HAI Acquisition Corporation

    19.0     (4.7 )   14.3             14.3  

Halex Holdings, Inc.

    2.0     (1.1 )   0.9             0.9  

Harvey Tool Company, LLC

    35.5     (1.8 )   33.7             33.7  

Hojeij Branded Foods, LLC

    2.9         2.9             2.9  

Hygiena Borrower LLC

    5.3         5.3             5.3  

Implementation Management Assistance, LLC

    24.1         24.1             24.1  

Infilaw Holdings, LLC

    11.5     (11.5 )                

Instituto de Banca y Comercio, Inc.

    11.8     (11.8 )                

iPipeline, Inc.

    4.0         4.0             4.0  

JDC Healthcare Management, LLC

    13.9     (1.5 )   12.4             12.4  

Jim N Nicks Management, LLC

    9.7     (1.7 )   8.0             8.0  

K2 Pure Solutions Nocal, L.P.

    5.0     (1.5 )   3.5             3.5  

KBHS Acquisition, LLC (d/b/a Alita Care, LLC)

    5.0     (1.8 )   3.2             3.2  

Key Surgical LLC

    2.8     (0.9 )   1.9             1.9  

KHC Holdings, Inc.

    6.9     (0.7 )   6.2             6.2  

Lakeland Tours, LLC

    1.9     (1.9 )                

LBP Intermediate Holdings LLC

    0.9     (0.1 )   0.8             0.8  

Liaison Acquisition, LLC

    3.9         3.9             3.9  

Massage Envy, LLC

    5.0     (0.5 )   4.5             4.5  

Massage Envy, LLC and ME Equity LLC

    0.6         0.6             0.6  

MB2 Dental Solutions, LLC

    3.5     (1.3 )   2.2             2.2  

McKenzie Sports Products, LLC

    4.5     (0.9 )   3.6             3.6  

Ministry Brands, LLC

    19.5     (10.9 )   8.6             8.6  

Movati Athletic (Group) Inc.

    2.8         2.8             2.8  

MSHC, Inc.

    9.8     (0.1 )   9.7             9.7  

MW Dental Holding Corp.

    10.0     (9.7 )   0.3             0.3  

Navisun LLC

    42.4         42.4             42.4  

NECCO Holdings, Inc.

    25.0     (21.7 )   3.3     (3.3 )        

Niagara Fiber Intermediate Corp.

    1.2     (0.9 )   0.3             0.3  

Nordco Inc.

    12.5         12.5             12.5  

NSM Sub Holdings Corp.

    5.0         5.0             5.0  

OmniSYS Acquisition Corporation, OmniSYS, LLC, and OSYS Holdings, LLC

    2.5         2.5             2.5  

Osmose Utilities Services, Inc.

    6.0     (1.0 )   5.0             5.0  

OTG Management, LLC

    13.6     (8.4 )   5.2             5.2  

Palermo Finance Corporation

    1.1     (0.2 )   0.9             0.9  

Paper Source, Inc.

    3.3         3.3             3.3  

Pathway Partners Vet Management Company LLC

    2.4         2.4             2.4  

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(in millions)
Portfolio Company
  Total revolving
and delayed
draw loan
commitments
  Less: drawn
commitments
  Total
undrawn
commitments
  Less:
commitments
substantially at
discretion of
the Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

PDI TA Holdings, Inc.

    12.5     (0.9 )   11.6             11.6  

Pegasus Intermediate Holdings, LLC

    5.0         5.0             5.0  

PIH Corporation and Primrose Holding Corporation

    3.3     (1.0 )   2.3             2.3  

Practice Insight, LLC

    2.9     (0.6 )   2.3             2.3  

QC Supply, LLC

    24.2     (4.0 )   20.2             20.2  

Restaurant Technologies, Inc.

    5.4     (1.1 )   4.3             4.3  

Retriever Medical/Dental Payments LLC

    3.5         3.5             3.5  

RuffaloCODY, LLC

    7.7     (0.2 )   7.5             7.5  

Sanders Industries Holdings, Inc.

    15.0         15.0             15.0  

SCM Insurance Services Inc.

    4.3         4.3             4.3  

SCSG EA Acquisition Company, Inc.

    4.0         4.0             4.0  

Severin Acquisition, LLC

    2.9         2.9             2.9  

SFE Intermediate Holdco LLC

    3.8     (0.8 )   3.0             3.0  

Shift PPC LLC

    3.6         3.6             3.6  

Sigma Electric Manufacturing Corporation

    10.0     (1.5 )   8.5             8.5  

Soil Safe, Inc. and Soil Safe Acquisition Corp.

    10.5     (4.6 )   5.9             5.9  

Sonny's Enterprises, LLC

    1.8     (1.0 )   0.8             0.8  

Sparta Systems, Inc.

    6.5         6.5             6.5  

Storm UK Holdco Limited and Storm US Holdco Inc.

    1.1     (0.1 )   1.0             1.0  

Teasdale Foods, Inc.

    0.8     (0.4 )   0.4             0.4  

The Gordian Group, Inc.

    1.1         1.1             1.1  

Things Remembered, Inc.

    2.4         2.4             2.4  

Towne Holdings, Inc.

    1.0         1.0             1.0  

TPTM Merger Corp.

    2.5         2.5             2.5  

Urgent Cares of America
Holdings I, LLC

    10.0         10.0             10.0  

VistaPharm, Inc.

    2.5         2.5             2.5  

VLS Recovery Services, LLC

    22.1     (1.8 )   20.3             20.3  

VRC Companies, LLC

    1.9     (0.8 )   1.1             1.1  

Woodstream Group, Inc. and Woodstream Corporation

    4.7         4.7             4.7  

Wrench Group LLC

    4.6         4.6             4.6  

Zemax, LLC

    3.0         3.0             3.0  

Zywave, Inc.

    11.4     (2.4 )   9.0             9.0  

  $ 881.5   $ (201.5 ) $ 680.0   $ (11.3 ) $   $ 668.7  
(22)
As of December 31, 2017, the Company was party to subscription agreements to fund equity investments in private equity investment partnerships as follows:
(in millions)
Company
  Total
private
equity
commitments
  Less:
funded
private
equity
commitments
  Total
unfunded
private
equity
commitments
  Less: private equity
commitments
substantially at
the discretion
of the Company
  Total net adjusted
unfunded private
equity
commitments
 

Partnership Capital Growth Investors III, L.P. 

  $ 5.0   $ (4.5 ) $ 0.5   $   $ 0.5  

PCG-Ares Sidecar Investment, L.P. and PCG-Ares Sidecar Investment II, L.P.

    50.0     (12.1 )   37.9     (37.9 )    

Piper Jaffray Merchant Banking Fund I, L.P.

    2.0     (1.8 )   0.2         0.2  

European Capital UK SME Debt LP

    54.0     (44.0 )   10.0     (10.0 )    

  $ 111.0   $ (62.4 ) $ 48.6   $ (47.9 ) $ 0.7  
(23)
As of December 31, 2017, the Company had commitments to co-invest in the SDLP for its portion of the SDLP's commitment to fund delayed draw loans of up to $19. See Note 4 to the consolidated financial statements for more information on the SDLP.

(24)
Other than the investments noted by this footnote, the fair value of the Company's investments is determined using unobservable inputs that are significant to the overall fair value measurement. See Note 8 to the consolidated financial statements for more information regarding the fair value of the Company's investments.

(25)
As of December 31, 2017, the net estimated unrealized loss for federal tax purposes was $0.8 billion based on a tax cost basis of $12.7 billion. As of December 31, 2017, the estimated aggregate gross unrealized loss for federal income tax purposes was $1.3 billion and the estimated aggregate gross unrealized gain for federal income tax purposes was $0.5 billion.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

(in millions, except per share data)

 
  Common Stock    
  Accumulated
Undistributed
(Overdistributed)
Earnings
   
 
 
  Capital in
Excess of
Par Value
  Total
Stockholders'
Equity
 
 
  Shares   Amount  

Balance at December 31, 2015

    314   $   $ 5,318   $ (145 ) $ 5,173  

Repurchases of common stock

            (5 )       (5 )

Net investment income

                494     494  

Net realized gains on investments, foreign currency transactions, extinguishment of debt and other assets

                110     110  

Net unrealized losses on investments and foreign currency transactions

                (130 )   (130 )

Dividends declared and payable ($1.52 per share)

                (477 )   (477 )

Tax reclassification of stockholders' equity in accordance with GAAP

            (21 )   21      

Balance at December 31, 2016

    314   $   $ 5,292   $ (127 ) $ 5,165  

Issuance of common stock in connection with the American Capital Acquisition

    112         1,839         1,839  

Deemed contributions from Ares Capital Management (See Note 16)

            54         54  

Shares issued in connection with dividend reinvestment plan

            6         6  

Issuance of Convertible Unsecured Notes (See Note 5)

            15         15  

Net investment income

                511     511  

Net realized gains on investments, foreign currency transactions, extinguishment of debt and other assets

                20     20  

Net unrealized gains on investments, foreign currency and other transactions

                136     136  

Dividends declared and payable ($1.52 per share)

                (648 )   (648 )

Tax reclassification of stockholders' equity in accordance with GAAP

            (14 )   14      

Balance at December 31, 2017

    426   $   $ 7,192   $ (94 ) $ 7,098  

Net investment income

                694     694  

Net realized gains on investments, foreign currency transactions, extinguishment of debt and other assets

                419     419  

Net unrealized losses on investments, foreign currency and other transactions

                (255 )   (255 )

Dividends declared and payable ($1.54 per share)

                (656 )   (656 )

Tax reclassification of stockholders' equity in accordance with GAAP

            (19 )   19      

Balance at December 31, 2018

    426   $   $ 7,173   $ 127   $ 7,300  

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(in millions)

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

OPERATING ACTIVITIES:

                   

Net increase in stockholders' equity resulting from operations

  $ 858   $ 667   $ 474  

Adjustments to reconcile net increase in stockholders' equity resulting from operations:

                   

Net realized gains on investments and foreign currency transactions

    (419 )   (24 )   (110 )

Net unrealized losses (gains) on investments, foreign currency and other transactions

    255     (136 )   130  

Realized losses on extinguishment of debt

        4      

Net accretion of discount on investments

    (12 )   (10 )   (6 )

Payment-in-kind interest and dividends

    (94 )   (79 )   (48 )

Collections of payment-in-kind interest and dividends

    39     65     12  

Amortization of debt issuance costs

    18     18     14  

Net accretion of discount on notes payable

    5     6     6  

Acquisition of American Capital, net of cash acquired

        (2,381 )    

Proceeds from sales and repayments of investments

    6,747     7,047     3,711  

Purchases of investments

    (7,109 )   (7,229 )   (3,475 )

Changes in operating assets and liabilities:

                   

Interest receivable

    2     28     26  

Other assets

    37     32     (11 )

Base management fees payable

    1     10      

Income based fees payable

    9     (5 )   1  

Capital gains incentive fees payable

    33     41     (4 )

Accounts payable and other liabilities

    (66 )   (122 )   (6 )

Interest and facility fees payable

        20     (7 )

Net cash provided by (used in) operating activities

    304     (2,048 )   707  

FINANCING ACTIVITIES:

                   

Net proceeds from issuance of common stock

        1,839      

Borrowings on debt

    6,592     12,209     9,855  

Repayments and repurchases of debt

    (6,241 )   (11,228 )   (10,104 )

Debt issuance costs

    (19 )   (37 )   (10 )

Dividends paid

    (656 )   (642 )   (477 )

Repurchases of common stock

            (5 )

Net cash provided by (used in) financing activities

    (324 )   2,141     (741 )

CHANGE IN CASH AND CASH EQUIVALENTS

    (20 )   93     (34 )

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

    316     223     257  

CASH AND CASH EQUIVALENTS, END OF PERIOD

  $ 296   $ 316   $ 223  

Supplemental Information:

                   

Interest paid during the period

  $ 201   $ 171   $ 168  

Taxes, including excise tax, paid during the period

  $ 20   $ 24   $ 18  

Dividends declared and payable during the period

  $ 656   $ 648   $ 477  

Deemed contribution from Ares Capital Management (see Note 16)

        $ 54        

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of December 31, 2018
(in millions, except per share data, percentages and as otherwise indicated;
for example, with the word "billion" or otherwise)

1.     ORGANIZATION

        Ares Capital Corporation (the "Company") is a specialty finance company that is a closed-end, non-diversified management investment company incorporated in Maryland. The Company has elected to be regulated as a business development company ("BDC") under the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the "Investment Company Act"). The Company has elected to be treated as a regulated investment company ("RIC") under the Internal Revenue Code of 1986, as amended (the "Code"), and operates in a manner so as to qualify for the tax treatment applicable to RICs.

        The Company's investment objective is to generate both current income and capital appreciation through debt and equity investments. The Company invests primarily in first lien senior secured loans (including "unitranche" loans, which are loans that combine both senior and mezzanine debt, generally in a first lien position), second lien senior secured loans and mezzanine debt, which in some cases includes an equity component. To a lesser extent, the Company also makes equity investments.

        The Company is externally managed by Ares Capital Management LLC ("Ares Capital Management" or the Company's "investment adviser"), a subsidiary of Ares Management Corporation ("Ares Management"), a publicly traded, leading global alternative asset manager, pursuant to an investment advisory and management agreement. Ares Operations LLC ("Ares Operations" or the Company's "administrator"), a subsidiary of Ares Management, provides certain administrative and other services necessary for the Company to operate.

2.     SIGNIFICANT ACCOUNTING POLICIES

    Basis of Presentation

        The accompanying consolidated financial statements have been prepared on the accrual basis of accounting in conformity with U.S. generally accepted accounting principles ("GAAP"), and include the accounts of the Company and its consolidated subsidiaries. The Company is an investment company following accounting and reporting guidance in Accounting Standards Codification ("ASC") 946. The consolidated financial statements reflect all adjustments and reclassifications that, in the opinion of management, are necessary for the fair presentation of the results of the operations and financial condition as of and for the periods presented. All significant intercompany balances and transactions have been eliminated.

    Cash and Cash Equivalents

        Cash and cash equivalents include funds from time to time deposited with financial institutions and short-term, liquid investments in a money market account. Cash and cash equivalents are carried at cost which approximates fair value. As of December 31, 2018 and 2017, there was $60 and $33, respectively, of cash denominated in foreign currencies included within "cash and cash equivalents" in the accompanying consolidated balance sheet.

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    Concentration of Credit Risk

        The Company places its cash and cash equivalents with financial institutions and, at times, cash held in money market accounts may exceed the Federal Deposit Insurance Corporation insured limit.

    Investments

        Investment transactions are recorded on the trade date. Realized gains or losses are measured by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. Unrealized gains or losses primarily reflect the change in investment values, including the reversal of previously recorded unrealized gains or losses when gains or losses are realized.

        Investments for which market quotations are readily available are typically valued at such market quotations. In order to validate market quotations, the Company looks at a number of factors to determine if the quotations are representative of fair value, including the source and nature of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available (i.e., substantially all of the Company's investments) are valued at fair value as determined in good faith by the Company's board of directors, based on, among other things, the input of the Company's investment adviser, audit committee and independent third-party valuation firms that have been engaged at the direction of the Company's board of directors to assist in the valuation of each portfolio investment without a readily available market quotation at least once during a trailing 12-month period (with certain de minimis exceptions) and under a valuation policy and a consistently applied valuation process. The valuation process is conducted at the end of each fiscal quarter, and a portion of the Company's investment portfolio at fair value is subject to review by an independent valuation firm each quarter. In addition, the Company's independent registered public accounting firm obtains an understanding of, and performs select procedures relating to, the Company's investment valuation process within the context of performing the integrated audit.

        As part of the valuation process, the Company may take into account the following types of factors, if relevant, in determining the fair value of the Company's investments: the enterprise value of a portfolio company (the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time), the nature and realizable value of any collateral, the portfolio company's ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company's securities to any similar publicly traded securities, changes in the interest rate environment and the credit markets, which may affect the price at which similar investments would trade in their principal markets and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Company considers the pricing indicated by the external event to corroborate its valuation.

        Because there is not a readily available market value for most of the investments in its portfolio, the Company values substantially all of its portfolio investments at fair value as determined in good faith by its board of directors, as described herein. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Company's investments may fluctuate from period to period. Additionally, the fair value of the Company's investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that the Company may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If the Company was required to liquidate a portfolio investment in a forced or liquidation sale, the Company could realize significantly less than the value at which the Company has recorded it.

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        In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected in the valuations currently assigned.

        The Company's board of directors undertakes a multi-step valuation process each quarter, as described below:

    The Company's quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals responsible for the portfolio investment in conjunction with the Company's portfolio management team.

    Preliminary valuations are reviewed and discussed with the Company's investment adviser's management and investment professionals, and then valuation recommendations are presented to the Company's board of directors.

    The audit committee of the Company's board of directors reviews these valuations, as well as the input of third parties, including independent third-party valuation firms who have reviewed a portion of the investments in the Company's portfolio at fair value.

    The Company's board of directors discusses valuations and ultimately determines the fair value of each investment in the Company's portfolio without a readily available market quotation in good faith based on, among other things, the input of the Company's investment adviser, audit committee and, where applicable, independent third-party valuation firms.

        See Note 8 for more information on the Company's valuation process.

    Interest and Dividend Income Recognition

        Interest income is recorded on an accrual basis and includes the accretion of discounts and amortization of premiums. Discounts from and premiums to par value on securities purchased are accreted/amortized into interest income over the life of the respective security using the effective yield method. The amortized cost of investments represents the original cost adjusted for the accretion of discounts and amortization of premiums, if any.

        Loans are generally placed on non-accrual status when principal or interest payments are past due 30 days or more or when there is reasonable doubt that principal or interest will be collected in full. Accrued and unpaid interest is generally reversed when a loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management's judgment regarding collectability. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management's judgment, are likely to remain current. The Company may make exceptions to this policy if the loan has sufficient collateral value and is in the process of collection.

        Dividend income on preferred equity securities is recorded as dividend income on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies.

    Payment-in-Kind Interest

        The Company has loans in its portfolio that contain payment-in-kind ("PIK") provisions. The PIK interest, computed at the contractual rate specified in each loan agreement, is added to the principal balance of the loan and recorded as interest income. To maintain the Company's status as a RIC, this non-cash source of income must be paid out to stockholders in the form of dividends, even though the Company has not yet collected the cash.

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    Capital Structuring Service Fees and Other Income

        In pursuit of the Company's investment objective, the Company's investment adviser seeks to provide assistance to its portfolio companies and in return the Company may receive fees for capital structuring services. These fees are fixed based on contractual terms, are generally only available to the Company as a result of the Company's underlying investments, are normally paid at the closing of the investments, are generally non-recurring and non-refundable and are recognized as revenue when earned upon closing of the investment. The services that the Company's investment adviser provides vary by investment, but generally include reviewing existing credit facilities, arranging bank financing, arranging equity financing, structuring financing from multiple lenders, structuring financing from multiple equity investors, restructuring existing loans, raising equity and debt capital, and providing general financial advice, which concludes upon closing of the investment. Any services of the above nature subsequent to the closing would generally generate a separate fee payable to the Company. In certain instances where the Company is invited to participate as a co-lender in a transaction and does not provide significant services in connection with the investment, a portion of loan fees paid to the Company in such situations will be deferred and amortized over the estimated life of the loan.

        Other income includes amendment fees that are fixed based on contractual terms and are generally non-recurring and non-refundable and are recognized as revenue when earned upon closing of the transaction. Other income also includes fees for management and consulting services, loan guarantees, commitments, and other services rendered by the Company to portfolio companies. Such fees are fixed based on contractual terms and are recognized as income as services are rendered.

    Foreign Currency Translation

        The Company's books and records are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:

    (1)
    Fair value of investment securities, other assets and liabilities—at the exchange rates prevailing at the end of the period.

    (2)
    Purchases and sales of investment securities, income and expenses—at the exchange rates prevailing on the respective dates of such transactions, income or expenses.

        Results of operations based on changes in foreign exchange rates are separately disclosed in the statement of operations, if any. Foreign security and currency translations may involve certain considerations and risks not typically associated with investing in U.S. companies and U.S. government securities. These risks include, but are not limited to, currency fluctuations and revaluations and future adverse political, social and economic developments, which could cause investments in foreign markets to be less liquid and prices more volatile than those of comparable U.S. companies or U.S. government securities.

    Derivative Instruments

        The Company does not utilize hedge accounting and as such values its derivatives at fair value with the unrealized gains or losses recorded in "net unrealized gains (losses) from foreign currency and other transactions" in the Company's consolidated statement of operations.

    Equity Offering Expenses

        The Company's offering costs are charged against the proceeds from equity offerings when proceeds are received.

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    Debt Issuance Costs

        Debt issuance costs are amortized over the life of the related debt instrument using the straight line method or the effective yield method, depending on the type of debt instrument.

    Income Taxes

        The Company has elected to be treated as a RIC under the Code and operates in a manner so as to qualify for the tax treatment applicable to RICs. To qualify as a RIC, the Company must (among other requirements) meet certain source-of- income and asset diversification requirements and timely distribute to its stockholders at least 90% of its investment company taxable income, as defined by the Code, for each year. The Company has made and intends to continue to make the requisite distributions to its stockholders, which will generally relieve the Company from U.S. federal corporate-level income taxes.

        Depending on the level of taxable income earned in a tax year, the Company may choose to carry forward taxable income in excess of current year dividend distributions from such current year taxable income into the next tax year and pay a 4% excise tax on such income, as required. To the extent that the Company determines that its estimated current year taxable income will be in excess of estimated dividend distributions for the current year, the Company accrues excise tax, if any, on estimated excess taxable income as such taxable income is earned.

        Certain of the Company's consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

    Dividends to Common Stockholders

        Dividends and distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid out as a dividend is determined by the Company's board of directors each quarter and is generally based upon the earnings estimated by management. Net realized capital gains, if any, are generally distributed, although the Company may decide to retain such capital gains for investment.

        The Company has adopted a dividend reinvestment plan that provides for reinvestment of any distributions the Company declares in cash on behalf of its stockholders, unless a stockholder elects to receive cash. As a result, if the Company's board of directors authorizes, and the Company declares, a cash dividend, then the Company's stockholders who have not "opted out" of the Company's dividend reinvestment plan will have their cash dividends automatically reinvested in additional shares of the Company's common stock, rather than receiving the cash dividend. The Company may use newly issued shares to implement the dividend reinvestment plan or, if the Company is otherwise permitted under applicable law to purchase such shares, the Company may purchase shares in the open market in connection with the Company's obligations under the dividend reinvestment plan.

    Use of Estimates in the Preparation of Financial Statements

        The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of actual and contingent assets and liabilities at the date of the financial statements and the reported amounts of income or loss and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the valuation of investments.

    Recent Accounting Pronouncements

        In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-02, Leases (Topic 842) . The objective of the guidance in this Accounting Standards Update ("ASU") is to increase transparency and comparability among organizations by recognizing lease assets and liabilities

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in the balance sheet and disclosing key information. ASU 2016-02 amends previous lease guidance, which required a lessee to categorize and account for leases as either operating leases or capital leases, and instead requires a lessee to recognize a lease liability and a right-of-use asset on the entity's balance sheet for all leases with terms that exceed one year. The lease liability and right-of-use asset are to be carried at the present value of remaining expected future lease payments. The guidance should be applied using a modified retrospective approach. ASU No. 2016-02 is effective for public entities for annual reporting periods beginning after December 15, 2018 and interim periods within those reporting periods, with early adoption permitted. The Company has completed its assessment of all leases and right-of-use terms, and estimates that the impact of the adoption of ASU 2016-02 is expected to be a recognition of operating right-of-use assets of approximately $109, operating lease liabilities of approximately $111 and a reclassification of $30 from accounts payable and other liabilities to operating lease liabilities relating to the remaining liability associated with lease abandonments assumed in the American Capital Acquisition on the accompanying consolidated balance sheet.

        In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement. The standard will modify the disclosure requirements for fair value measurements by removing, modifying, or adding certain disclosures. ASU No. 2018-13 is effective for annual reporting periods beginning after December 15, 2019, including interim periods within that reporting period. Early adoption is permitted upon issuance of this ASU. The Company is permitted to early adopt any removed or modified disclosures upon issuance of this ASU and delay adoption of the additional disclosures until their effective date. The Company has elected to early adopt ASU No. 2018-13 as of December 31, 2018.

    SEC Disclosure Update and Simplification

        In August 2018, the SEC adopted the final rule under SEC Release No. 33-10532, Disclosure Update and Simplification , amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. The amendments are intended to facilitate the disclosure of information to investors and simplify compliance. The Company adopted the final rule under SEC Release No. 33-10532 as of December 31, 2018. The Company has evaluated the impact of the amendments and determined the effect of the adoption of the simplification rules on financial statements will be limited to the modification and removal of certain disclosures.

3.     AGREEMENTS

    Investment Advisory and Management Agreement

        The Company is party to an investment advisory and management agreement (the "investment advisory and management agreement") with Ares Capital Management. Subject to the overall supervision of the Company's board of directors, Ares Capital Management provides investment advisory and management services to the Company. For providing these services, Ares Capital Management receives fees from the Company consisting of a base management fee, a fee based on the Company's net investment income ("income based fee") and a fee based on the Company's net capital gains ("capital gains incentive fee"). The investment advisory and management agreement may be terminated by either party without penalty upon 60 days' written notice to the other party.

        The base management fee is calculated at an annual rate of 1.5% based on the average value of the Company's total assets (other than cash or cash equivalents, but including assets purchased with borrowed funds) at the end of the two most recently completed calendar quarters. The base management fee is payable quarterly in arrears. In connection with the Company's board of directors approving the modification of the asset coverage requirement applicable to senior securities from 200% to 150% effective on June 21, 2019 (unless the Company receives earlier stockholder approval), the investment advisory and management agreement will be amended effective June 21, 2019 (or such

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earlier date) to reduce the Company's annual base management fee from 1.5% to 1.0% on all assets financed using leverage over 1.0x debt to equity. See Note 5 for additional information.

        The income based fee is calculated and payable quarterly in arrears based on the Company's pre-incentive fee net investment income, as defined in the investment advisory and management agreement, for the quarter. Pre-incentive fee net investment income means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring, diligence and consulting fees or other fees that the Company receives from portfolio companies but excluding fees for providing managerial assistance) accrued during the calendar quarter, minus operating expenses for the quarter (including the base management fee, any expenses payable under the administration agreement, and any interest expense and dividends paid on any outstanding preferred stock, but excluding the income based fee and capital gains incentive fee accrued under GAAP). Pre-incentive fee net investment income includes, in the case of investments with a deferred interest feature such as market discount, debt instruments with PIK interest, preferred stock with PIK dividends and zero coupon securities, accrued income that the Company has not yet received in cash. The Company's investment adviser is not under any obligation to reimburse the Company for any part of the income based fees it received that was based on accrued interest that the Company never actually received.

        Pre-incentive fee net investment income does not include any realized capital gains, realized capital losses, unrealized capital appreciation, unrealized capital depreciation or income tax expense related to realized gains and losses. Because of the structure of the income based fee, it is possible that the Company may pay such fees in a quarter where the Company incurs a loss. For example, if the Company receives pre-incentive fee net investment income in excess of the hurdle rate (as defined below) for a quarter, the Company will pay the applicable income based fee even if the Company has incurred a loss in that quarter due to realized and/or unrealized capital losses.

        Pre-incentive fee net investment income, expressed as a rate of return on the value of the Company's net assets (defined as total assets less indebtedness and before taking into account any income based fees and capital gains incentive fees payable during the period) at the end of the immediately preceding calendar quarter, is compared to a fixed "hurdle rate" of 1.75% per quarter. If market credit spreads rise, the Company may be able to invest its funds in debt instruments that provide for a higher return, which may increase the Company's pre-incentive fee net investment income and make it easier for the Company's investment adviser to surpass the fixed hurdle rate and receive an income based fee based on such net investment income. To the extent the Company has retained pre-incentive fee net investment income that has been used to calculate the income based fee, it is also included in the amount of the Company's total assets (other than cash and cash equivalents but including assets purchased with borrowed funds) used to calculate the 1.5% base management fee.

        The Company pays its investment adviser an income based fee with respect to the Company's pre-incentive fee net investment income in each calendar quarter as follows:

    No income based fee in any calendar quarter in which the Company's pre- incentive fee net investment income does not exceed the hurdle rate;

    100% of the Company's pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 2.1875% in any calendar quarter. The Company refers to this portion of its pre-incentive fee net investment income (which exceeds the hurdle rate but is less than 2.1875%) as the "catch-up" provision. The "catch-up" is meant to provide the Company's investment adviser with 20% of the pre-incentive fee net investment income as if a hurdle rate did not apply if this net investment income exceeded 2.1875% in any calendar quarter; and

    20% of the amount of the Company's pre-incentive fee net investment income, if any, that exceeds 2.1875% in any calendar quarter.

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        These calculations are adjusted for any share issuances or repurchases during the quarter.

        In connection with the Company's acquisition of American Capital, Ltd., a Delaware corporation ("American Capital") (the "American Capital Acquisition"), Ares Capital Management agreed to waive, for each of the first ten calendar quarters beginning with the second quarter of 2017 and ending with the third quarter of 2019, the lesser of (x) $10 of income based fees and (y) the amount of income based fees for such quarter, in each case, to the extent payable by the Company in such quarter pursuant to and as calculated under the Company's investment advisory and management agreement (the "Fee Waiver"). See Note 16 for additional information regarding the American Capital Acquisition.

        The capital gains incentive fee is determined and payable in arrears as of the end of each calendar year (or, upon termination of the investment advisory and management agreement, as of the termination date) and is calculated at the end of each applicable year by subtracting (a) the sum of the Company's cumulative aggregate realized capital losses and aggregate unrealized capital depreciation from (b) the Company's cumulative aggregate realized capital gains, in each case calculated from October 8, 2004 (the date the Company completed its initial public offering). Realized capital gains and losses include gains and losses on investments and foreign currencies, gains and losses on extinguishment of debt and from other assets, as well as any income tax and other expenses related to cumulative aggregate realized gains and losses. If such amount is positive at the end of such year, then the capital gains incentive fee for such year is equal to 20% of such amount, less the aggregate amount of capital gains incentive fees paid in all prior years. If such amount is negative, then there is no capital gains incentive fee for such year.

        The cumulative aggregate realized capital gains are calculated as the sum of the differences, if positive, between (a) the net sales price of each investment in the Company's portfolio when sold and (b) the accreted or amortized cost basis of such investment.

        The cumulative aggregate realized capital losses are calculated as the sum of the amounts by which (a) the net sales price of each investment in the Company's portfolio when sold is less than (b) the accreted or amortized cost basis of such investment.

        The aggregate unrealized capital depreciation is calculated as the sum of the differences, if negative, between (a) the valuation of each investment in the Company's portfolio as of the applicable capital gains incentive fee calculation date and (b) the accreted or amortized cost basis of such investment.

        Notwithstanding the foregoing, as a result of an amendment to the capital gains incentive fee under the investment advisory and management agreement that was adopted on June 6, 2011, if the Company is required by GAAP to record an investment at its fair value as of the time of acquisition instead of at the actual amount paid for such investment by the Company (including, for example, as a result of the application of the asset acquisition method of accounting), then solely for the purposes of calculating the capital gains incentive fee, the "accreted or amortized cost basis" of an investment shall be an amount (the "Contractual Cost Basis") equal to (1) (x) the actual amount paid by the Company for such investment plus (y) any amounts recorded in the Company's financial statements as required by GAAP that are attributable to the accretion of such investment plus (z) any other adjustments made to the cost basis included in the Company's financial statements, including PIK interest or additional amounts funded (net of repayments) minus (2) any amounts recorded in the Company's financial statements as required by GAAP that are attributable to the amortization of such investment, whether such calculated Contractual Cost Basis is higher or lower than the fair value of such investment (as determined in accordance with GAAP) at the time of acquisition.

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        The base management fees, income based fees and capital gains incentive fees for the years ended December 31, 2018, 2017 and 2016 were as follows:

 
  For the years ended
December 31,
 
 
  2018   2017   2016  

Base management fees

  q$ 180   $ 171   $ 137  

Income based fees

  $ 169   $ 134   $ 123  

Waiver of income based fees

    (40 )   (30 )    

Income based fees, net of Fee Waiver

  $ 129   $ 104   $ 123  

Capital gains incentive fees(1)

  $ 33   $ 41 (2) $ (5 )

(1)
Calculated in accordance with GAAP as discussed below.

(2)
Includes $11 of capital gains incentive fees recorded in connection with the American Capital Acquisition as a result of the fair value of the net assets acquired exceeding the fair value of the merger consideration paid by the Company. See Note 16 for additional information regarding the American Capital Acquisition.

        The capital gains incentive fee payable to the Company's investment adviser as calculated under the investment advisory and management agreement for the year ended December 31, 2018 was $50. There was no capital gains incentive fee earned by the Company's investment adviser as calculated under the investment advisory and management agreement for the years ended December 2017 and 2016. In addition, in accordance with GAAP, the Company had cumulatively accrued a capital gains incentive fee of $112 as of December 31, 2018, of which $62 is not currently due under the investment advisory and management agreement. GAAP requires that the capital gains incentive fee accrual consider the cumulative aggregate unrealized capital appreciation in the calculation, as a capital gains incentive fee would be payable if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the investment advisory and management agreement. This GAAP accrual is calculated using the aggregate cumulative realized capital gains and losses and aggregate cumulative unrealized capital depreciation included in the calculation of the capital gains incentive fee plus the aggregate cumulative unrealized capital appreciation, net of any expense associated with cumulative unrealized capital depreciation or appreciation. If such amount is positive at the end of a period, then GAAP requires the Company to record a capital gains incentive fee equal to 20% of such cumulative amount, less the aggregate amount of actual capital gains incentive fees paid or capital gains incentive fees accrued under GAAP in all prior periods. As of December 31, 2018, the Company has paid capital gains incentive fees since inception totaling $57, excluding the $50 payable for the year ended December 31, 2018 that will be paid in the first quarter of 2019. The resulting accrual for any capital gains incentive fee under GAAP in a given period may result in an additional expense if such cumulative amount is greater than in the prior period or a reversal of previously recorded expense if such cumulative amount is less than in the prior period. If such cumulative amount is negative, then there is no accrual. There can be no assurance that such unrealized capital appreciation will be realized in the future.

        The Company defers cash payment of any income based fees and capital gains incentive fees otherwise earned by the Company's investment adviser if during the most recent four full calendar quarter period ending on or prior to the date such payment is to be made the sum of (a) the aggregate distributions to the Company's stockholders and (b) the change in net assets (defined as total assets less indebtedness and before taking into account any income based fees and capital gains incentive fees payable during the period) is less than 7.0% of the Company's net assets (defined as total assets less indebtedness) at the beginning of such period. Any deferred income based fees and capital gains

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incentive fees are carried over for payment in subsequent calculation periods to the extent such payment is payable under the investment advisory and management agreement.

        The services of all investment professionals and staff of the Company's investment adviser, when and to the extent engaged in providing investment advisory and management services to the Company and routine overhead expenses of such personnel allocable to such services, are provided and paid for by the Company's investment adviser. Under the investment advisory and management agreement, the Company bears all other costs and expenses of its operations and transactions, including, but not limited to, those relating to: organization; calculation of the Company's net asset value (including, but not limited to, the cost and expenses of any independent valuation firm); expenses incurred by the Company's investment adviser payable to third parties, including agents, consultants or other advisers, in monitoring the Company's financial and legal affairs and in monitoring the Company's investments (including the cost of consultants hired to develop information technology systems designed to monitor the Company's investments) and performing due diligence on the Company's prospective portfolio companies; interest payable on indebtedness, if any, incurred to finance the Company's investments (including payments to third party vendors for financial information services); offerings of the Company's common stock and other securities; investment advisory and management fees; administration fees; fees payable to third parties, including agents, consultants or other advisers, relating to, or associated with, evaluating and making investments in portfolio companies, regardless of whether such transactions are ultimately consummated; transfer agent and custodial fees; registration fees; listing fees; taxes; independent directors' fees and expenses; costs of preparing and filing reports or other documents with the SEC; the costs of any reports, proxy statements or other notices to stockholders, including printing costs; to the extent the Company is covered by any joint insurance policies, the Company's allocable portion of the insurance premiums for such policies; direct costs and expenses of administration, including auditor and legal costs; and all other expenses incurred by the Company or its administrator in connection with administering the Company's business as described in more detail under "Administration Agreement" below.

    Administration Agreement

        The Company is party to an administration agreement, referred to herein as the "administration agreement", with its administrator, Ares Operations. Pursuant to the administration agreement, Ares Operations furnishes the Company with office equipment and clerical, bookkeeping and record keeping services at the Company's office facilities. Under the administration agreement, Ares Operations also performs, or oversees the performance of, the Company's required administrative services, which include, among other things, providing assistance in accounting, legal, compliance, operations, technology and investor relations, being responsible for the financial records that the Company is required to maintain and preparing reports to its stockholders and reports filed with the Securities and Exchange Commission (the "SEC"). In addition, Ares Operations assists the Company in determining and publishing its net asset value, assists the Company in providing managerial assistance to its portfolio companies, oversees the preparation and filing of the Company's tax returns and the printing and dissemination of reports to its stockholders, and generally oversees the payment of its expenses and the performance of administrative and professional services rendered to the Company by others. Payments under the administration agreement are equal to an amount based upon its allocable portion of Ares Operations' overhead and other expenses (including travel expenses) incurred by Ares Operations in performing its obligations under the administration agreement, including the Company's allocable portion of the compensation, rent and other expenses of certain of its officers (including the Company's chief compliance officer, chief financial officer, chief accounting officer, general counsel, secretary, treasurer and assistant treasurer) and their respective staffs. The administration agreement may be terminated by either party without penalty upon 60 days' written notice to the other party.

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        For the years ended December 31, 2018, 2017 and 2016, the Company incurred $13, $12 and $14, respectively, in administrative fees. In addition, for the year ended December 31, 2017, the Company incurred an additional $8 in administrative fees related to the integration of the American Capital Acquisition. These acquisition-related expenses are included in "professional fees and other costs related to the American Capital Acquisition" in the consolidated statement of operations. As of December 31, 2018, $3 of the administrative fees were unpaid and included in "accounts payable and other liabilities" in the accompanying consolidated balance sheet.

4.     INVESTMENTS

        As of December 31, 2018 and 2017, investments consisted of the following:

 
  As of December 31,  
 
  2018   2017  
 
  Amortized
Cost(1)
  Fair
Value
  Amortized
Cost(1)
  Fair
Value
 

First lien senior secured loans

  $ 5,976   $ 5,836   $ 5,337   $ 5,197  

Second lien senior secured loans

    3,878     3,657     3,885     3,744  

Subordinated certificates of the SDLP(2)

    652     652     487     487  

Senior subordinated loans

    717     727     978     995  

Collateralized loan obligations

    44     45     115     114  

Preferred equity securities

    576     444     485     532  

Other equity securities

    911     1,056     618     772  

Total

  $ 12,754   $ 12,417   $ 11,905   $ 11,841  

(1)
The amortized cost represents the original cost adjusted for the accretion of discounts and amortization of premiums, if any.

(2)
The proceeds from these certificates were applied to co-investments with Varagon and its clients to fund first lien senior secured loans to 21 and 19 different borrowers as of December 31, 2018 and 2017, respectively.

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        The industrial and geographic compositions of the Company's portfolio at fair value as of December 31, 2018 and 2017 were as follows:

 
  As of December 31,  
 
  2018   2017  

Industry

             

Healthcare Services

    21.7 %   22.5 %

Business Services

    17.9     19.2  

Consumer Products

    8.3     6.8  

Financial Services

    6.6     4.3  

Investment Funds and Vehicles(1)

    6.2     5.8  

Manufacturing

    6.1     6.0  

Other Services

    5.7     6.2  

Power Generation

    4.8     3.6  

Restaurants and Food Services

    3.8     3.3  

Oil and Gas

    3.0     2.5  

Food and Beverage

    2.9     4.3  

Automotive Services

    2.8     3.0  

Wholesale Distribution

    2.3     2.5  

Education

    2.2     3.0  

Containers and Packaging

    1.5     2.1  

Other

    4.2     4.9  

Total

    100.0 %   100.0 %

(1)
Includes the Company's investment in the SDLP, which had made first lien senior secured loans to 21 and 19 different borrowers as of December 31, 2018 and 2017, respectively. The portfolio companies in the SDLP are in industries similar to the companies in the Company's portfolio.
 
  As of December 31,  
 
  2018   2017  

Geographic Region

             

Midwest

    31.4 %   25.3 %

West(1)

    24.0     23.9  

Southeast

    18.8     28.5  

Mid Atlantic

    18.2     15.0  

Northeast

    5.4     3.9  

International

    2.2     3.4  

Total

    100.0 %   100.0 %

(1)
Includes the Company's investment in the SDLP, which represented 5.3% and 4.1% of the total investment portfolio at fair value as of December 31, 2018 and 2017, respectively.

        As of December 31, 2018, 2.5% of total investments at amortized cost (or 0.6% of total investments at fair value) were on non-accrual status. As of December 31, 2017, 3.1% of total investments at amortized cost (or 1.4% of total investments at fair value) were on non-accrual status.

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Co-Investment Programs

    Senior Direct Lending Program

        The Company has established a joint venture with Varagon to make certain first lien senior secured loans, including certain stretch senior and unitranche loans, primarily to U.S. middle market companies. Varagon was formed in 2013 as a lending platform by American International Group, Inc. and other partners. The joint venture is called the SDLP. In July 2016, the Company and Varagon and its clients completed the initial funding of the SDLP. The SDLP may generally commit and hold individual loans of up to $300. The Company and other accounts managed by the Company's investment adviser and its affiliates may directly co-invest with the SDLP to accommodate larger transactions. The SDLP is capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of the Company and Varagon (with approval from a representative of each required).

        The Company provides capital to the SDLP in the form of subordinated certificates (the "SDLP Certificates"), and Varagon and its clients provide capital to the SDLP in the form of senior notes, intermediate funding notes and SDLP Certificates. As of December 31, 2018 and 2017, the Company and a client of Varagon owned 87.5% and 12.5%, respectively, of the outstanding SDLP Certificates.

        As of December 31, 2018 and 2017, the Company and Varagon and its clients had agreed to make capital available to the SDLP of $6,400 and $2,925, respectively, in the aggregate, of which $1,444 and $591, respectively, is to be made available from the Company. The Company will continue to provide capital to the SDLP in the form of SDLP Certificates, and Varagon and its clients will provide capital to the SDLP in the form of senior notes, intermediate funding notes and SDLP Certificates. This capital will only be committed to the SDLP upon approval of transactions by the investment committee of the SDLP as discussed above. Below is a summary of the funded capital and unfunded capital commitments of the SDLP.

 
  As of December 31,  
 
  2018   2017  

Total capital funded to the SDLP(1)

  $ 3,104   $ 2,319  

Total capital funded to the SDLP by the Company(1)

  $ 652   $ 487  

Total unfunded capital commitments to the SDLP(2)

  $ 187   $ 92  

Total unfunded capital commitments to the SDLP by the Company(2)

  $ 39   $ 19  

(1)
At principal amount.

(2)
These commitments have been approved by the investment committee of the SDLP and will be funded as the transactions are completed.

        The SDLP Certificates pay a coupon of LIBOR plus 8.0% and also entitle the holders thereof to receive a portion of the excess cash flow from the loan portfolio, after expenses, which may result in a return to the holders of the SDLP Certificates that is greater than the stated coupon. The SDLP Certificates are junior in right of payment to the senior notes and intermediate funding notes.

        The amortized cost and fair value of the SDLP Certificates held by the Company were $652 and $652, respectively, as of December 31, 2018. The Company's yield on its investment in the SDLP at amortized cost and fair value was 15.0% and 15.0%, respectively, as of December 31, 2018. The amortized cost and fair value of the SDLP Certificates held by the Company were $487 and $487, respectively, as of December 31, 2017. The Company's yield on its investment in the SDLP at amortized cost and fair value was 14.5% and 14.5%, respectively, as of December 31, 2017. For the

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years ended December 31, 2018, 2017 and 2016, the Company earned interest income of $87, $52, and $13, respectively, from its investment in the SDLP Certificates. The Company is also entitled to certain fees in connection with the SDLP. For the years ended December 31, 2018, 2017 and 2016, in connection with the SDLP, the Company earned capital structuring service and other fees totaling $16, $11 and $6, respectively.

        As of December 31, 2018 and 2017, the SDLP's portfolio was comprised entirely of first lien senior secured loans to U.S. middle market companies and were in industries similar to the companies in the Company's portfolio. As of December 31, 2018 and 2017, none of the loans were on non-accrual status. Below is a summary of the SDLP's portfolio.

 
  As of December 31,  
 
  2018   2017  

Total first lien senior secured loans(1)

  $ 3,086   $ 2,316  

Largest loan to a single borrower(1)

  $ 249   $ 200  

Total of five largest loans to borrowers(1)

  $ 1,132   $ 947  

Number of borrowers in the SDLP

    21     19  

Commitments to fund delayed draw loans(2)

  $ 187   $ 92  

(1)
At principal amount.

(2)
As discussed above, these commitments have been approved by the investment committee of the SDLP.

    Senior Secured Loan Program

        The Company and General Electric Capital Corporation and GE Global Sponsor Finance LLC (collectively, "GE") had previously co-invested in first lien senior secured loans of middle market companies through the SSLP. The SSLP was capitalized as transactions were completed. All portfolio decisions and generally all other decisions in respect of the SSLP were approved by an investment committee of the SSLP consisting of representatives of the Company and GE (with approval from a representative of each required). The Company provided capital to the SSLP in the form of subordinated certificates (the "SSLP Certificates"). GE provided capital to the SSLP in the form of senior notes and the SSLP Certificates.

        As of June 30, 2017, the Company's investment in the SSLP Certificates at amortized cost and fair value was $1.9 billion and $1.9 billion, respectively. As of June 30, 2017, the SSLP had $1.2 billion in cash and GE's senior notes outstanding totaled $601. In July 2017, the SSLP made its monthly waterfall distribution from this cash, which fully repaid the senior notes of the SSLP with the remaining amounts distributed to the holders of the SSLP Certificates. From this distribution, the Company received $474 in respect of the Company's SSLP Certificates. After this distribution, the Company's amortized cost in its SSLP Certificates was $1.5 billion.

        In June 2017, the Company purchased the SSLP's entire $259 in aggregate principal amount of first lien senior secured loan investments in Implus Footcare, LLC ("Implus") at fair value of $259. As a result of the transaction, the SSLP fully exited its investment in Implus.

        In addition, in July 2017, the Company and GE agreed to an effective termination of the SSLP whereby on July 26, 2017, the Company purchased the remaining $1.6 billion in aggregate principal amount of first lien senior secured loans outstanding at par plus accrued and unpaid interest and fees from the SSLP (the "SSLP Loan Sale") and assumed the SSLP's remaining unfunded loan commitments totaling $50. Upon completion of the SSLP Loan Sale, the SSLP made a liquidation distribution to the holders of the SSLP Certificates (the "SSLP Liquidation Distribution"), of which the

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Company received $1.5 billion. In connection with the SSLP Liquidation Distribution, the Company recognized an $18 realized loss. After completion of the transactions above, the operations of the SSLP were effectively terminated pursuant to the terms of the documents governing the SSLP and the SSLP no longer has an obligation to fund existing commitments and other amounts in respect of its former portfolio companies.

        For the years ended December 31, 2017 and 2016, the Company earned interest income of $69 and $208, respectively, from its investment in the SSLP Certificates. The Company was also entitled to certain fees in connection with the SSLP. For the years ended December 31, 2017 and 2016, in connection with the SSLP, the Company earned capital structuring service, sourcing and other fees totaling $5 and $20, respectively.

    Ivy Hill Asset Management, L.P.

        Ivy Hill Asset Management, L.P. ("IHAM") is an asset management services company and an SEC-registered investment adviser. The Company has made investments in IHAM, its wholly owned portfolio company, and previously made investments in certain vehicles managed by IHAM. As of December 31, 2018, IHAM had assets under management of approximately $4.7 billion. As of December 31, 2018, IHAM managed 21 vehicles and served as the sub-manager/sub-servicer for two other vehicles (these vehicles managed or sub-managed/sub-serviced by IHAM are collectively referred to as the "IHAM Vehicles"). IHAM earns fee income from managing the IHAM Vehicles and has also invested in certain of these vehicles as part of its business strategy. As of December 31, 2018 and 2017, IHAM had total investments of $448 and $229, respectively. For the years ended December 31, 2018, 2017 and 2016, IHAM had management and incentive fee income of $25, $44 and $17, respectively, and other investment-related income of $45, $26 and $24, respectively.

        In connection with the American Capital Acquisition, which was completed on January 3, 2017 (the "Acquisition Date"), American Capital Asset Management, LLC ("ACAM"), a wholly owned portfolio company of American Capital, merged with and into IHAM, with IHAM remaining as the surviving entity as a wholly owned portfolio company of the Company. As a result of the merger of IHAM and ACAM, the Company's investment in IHAM increased by $179, which was recorded as an equity capital contribution in the amount of the fair value of the net assets of ACAM as of the Acquisition Date. In January 2017, as a result of sales of certain assets previously held by ACAM, IHAM made a distribution to the Company of $103, which was recorded as a return of the Company's equity capital contribution discussed above. See Note 14 for additional information regarding the American Capital Acquisition.

        The amortized cost and fair value of the Company's investment in IHAM was $444 and $518, respectively, as of December 31, 2018, and $244 and $315, respectively, as of December 31, 2017. For the years ended December 31, 2018, 2017 and 2016, the Company received distributions from IHAM of $58, $40 (excluding the $103 return of capital discussed above) and $40, respectively. The distributions for the years ended December 31, 2018, 2017 and 2016 included dividend income of $58, $40 and $40, respectively. Additionally, in February 2018, the Company provided a $63 subordinated revolving loan and a $200 equity capital contribution to IHAM to help support IHAM's acquisition of a portfolio of middle market loans.

        From time to time, IHAM or certain IHAM Vehicles may purchase investments from, or sell investments to, the Company. For any such sales or purchases by the IHAM Vehicles to or from the Company, the IHAM Vehicles must obtain approval from third parties unaffiliated with the Company or IHAM, as applicable. During the years ended December 31, 2018, 2017 and 2016, IHAM or certain of the IHAM Vehicles purchased $482, $137 and $495, respectively, of investments from the Company. For the year ended December 31, 2018, the Company recorded $0 of net realized losses from these sales. For the year ended December 31, 2017, the Company recorded $0 of net realized losses from these sales. For the year ended December 31, 2016, the Company recorded $1 of net realized gains from these sales.

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        IHAM is party to an administration agreement, referred to herein as the "IHAM administration agreement," with Ares Operations. Pursuant to the IHAM administration agreement, Ares Operations provides IHAM with, among other things, office facilities, equipment, clerical, bookkeeping and record keeping services, services relating to the marketing and sale of interests in vehicles managed by IHAM, services of, and oversight of, custodians, depositories, accountants, attorneys, underwriters and such other persons in any other capacity deemed to be necessary. Under the IHAM administration agreement, IHAM reimburses Ares Operations for all of the actual costs associated with such services, including Ares Operations' allocable portion of the compensation, rent and other expenses of its officers, employees and respective staff in performing its obligations under the IHAM administration agreement.

5.     DEBT

        In accordance with the Investment Company Act, the Company is currently allowed to borrow amounts such that its asset coverage, calculated pursuant to the Investment Company Act, is at least 200% after such borrowing. On June 21, 2018, the Company's board of directors, including a "required majority" (as such term is defined in Section 57(o) of the Investment Company Act) of the Company's board of directors, approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the Investment Company Act, as amended by the Small Business Credit Availability Act. As a result, effective on June 21, 2019 (unless the Company receives earlier stockholder approval), the Company's asset coverage requirement applicable to senior securities will be reduced from 200% to 150%. As of December 31, 2018, the aggregate amount outstanding of the senior securities issued by the Company was $5,298. As of December 31, 2018 the Company's asset coverage was 236%.

        The Company's outstanding debt as of December 31, 2018 and 2017 was as follows:

 
  As of December 31,  
 
  2018   2017  
 
  Total
Aggregate
Principal
Amount
Committed/
Outstanding(1)
  Principal
Amount
Outstanding
  Carrying
Value
  Total
Aggregate
Principal
Amount
Committed/
Outstanding(1)
  Principal
Amount
Outstanding
  Carrying
Value
 

Revolving Credit Facility

  $ 2,133 (2) $ 1,064   $ 1,064   $ 2,108   $ 395   $ 395  

Revolving Funding Facility

    1,000     520     520     1,000     600     600  

SMBC Funding Facility

    400     245     245     400     60     60  

SBA Debentures

            (3)   50          

2018 Convertible Notes

                270     270     270 (4)

2019 Convertible Notes

    300     300     300 (4)   300     300     298 (4)

2022 Convertible Notes

    388     388     372 (4)   388     388     368 (4)

2018 Notes

                750     750     748 (5)

2020 Notes

    600     600     598 (6)   600     600     597 (6)

2022 Notes

    600     600     595 (7)   600     600     593 (7)

2023 Notes

    750     750     744 (8)   750     750     743 (8)

2025 Notes

    600     600     593 (9)            

2047 Notes

    230     230     183 (10)   230     230     182 (10)

Total

  $ 7,001   $ 5,297   $ 5,214   $ 7,446   $ 4,943   $ 4,854  

(1)
Subject to borrowing base, leverage and other restrictions. Represents the total aggregate amount committed or outstanding, as applicable, under such instrument.

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(2)
Provides for a feature that allows the Company, under certain circumstances, to increase the size of the Revolving Credit Facility (as defined below) to a maximum of $3,133.

(3)
See below for more information on the termination of the undrawn SBA Debenture (as defined below) commitments.

(4)
Represents the aggregate principal amount outstanding of the Convertible Unsecured Notes (as defined below). As of December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount for the 2019 Convertible Notes and the 2022 Convertible Notes (each as defined below) were $0 and $16, respectively. As of December 31, 2017, the total unamortized debt issuance costs and the unaccreted discount for the 2018 Convertible Notes, the 2019 Convertible Notes and the 2022 Convertible Notes were $0, $2 and $20, respectively.

(5)
Represents the aggregate principal amount outstanding of the 2018 Notes (as defined below) less unamortized debt issuance costs and plus the net unamortized premium that was recorded upon the issuances of the 2018 Notes. As of December 31, 2017, the total unamortized debt issuance costs less the net unamortized premium was $2.

(6)
Represents the aggregate principal amount outstanding of the 2020 Notes (as defined below) less unamortized debt issuance costs and the net unaccreted discount recorded upon the issuances of the 2020 Notes. As of December 31, 2018 and 2017, the total unamortized debt issuance costs and the net unaccreted discount was $2 and $3, respectively.

(7)
Represents the aggregate principal amount outstanding of the 2022 Notes (as defined below), less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2022 Notes. As of December 31, 2018 and 2017, the total unamortized debt issuance costs and the unaccreted discount was $5 and $7, respectively.

(8)
Represents the aggregate principal amount outstanding of the 2023 Notes (as defined below), less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2023 Notes. As of December 31, 2018 and 2017, the total unamortized debt issuance costs and the unaccreted discount was $6 and $7, respectively.

(9)
Represents the aggregate principal amount outstanding of the 2025 Notes (as defined below), less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2025 Notes. As of December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount was $7.

(10)
Represents the aggregate principal amount outstanding of the 2047 Notes (as defined below) less the unaccreted purchased discount recorded as a part of the Allied Acquisition (as defined below). As of December 31, 2018 and 2017, the total unaccreted purchased discount was $47 and $48, respectively. The carrying value represents the outstanding principal amount of the 2047 Notes less the unaccreted purchased discount recorded as a part of the Allied Acquisition.

        The weighted average stated interest rate and weighted average maturity, both on aggregate principal amount outstanding, of all the Company's outstanding debt as of December 31, 2018 were 4.1% and 4.8 years, respectively, and as of December 31, 2017 were 4.1% and 4.3 years, respectively.

    Revolving Credit Facility

        The Company is party to a senior secured revolving credit facility (as amended and restated, the "Revolving Credit Facility"), which allows the Company to borrow up to $2,133 at any one time outstanding. The Revolving Credit Facility consists of a $414 term loan tranche with a stated maturity date of March 30, 2023 and a $1,719 revolving tranche. For $1,624 of the revolving tranche, the end of the revolving period and the stated maturity date are March 30, 2022 and March 30, 2023, respectively. For $50 of the revolving tranche, the end of the revolving period and the stated maturity date are

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January 4, 2021 and January 4, 2022, respectively. For the remaining $45 of the revolving tranche, the end of the revolving period and the stated maturity date are May 4, 2019 and May 4, 2020, respectively. The Revolving Credit Facility also provides for a feature that allows the Company, under certain circumstances, to increase the overall size of the Revolving Credit Facility to a maximum of $3,133. The Revolving Credit Facility generally requires payments of interest at the end of each LIBOR interest period, but no less frequently than quarterly, on LIBOR based loans, and monthly payments of interest on other loans. From the end of the revolving period to the stated maturity date as applicable for each revolving tranche, the Company is required to repay outstanding principal amounts under such revolving tranche on a monthly basis in an amount equal to 1/12th of the outstanding principal amount at the end of the revolving period.

        Under the Revolving Credit Facility, the Company is required to comply with various covenants, reporting requirements and other customary requirements for similar revolving credit facilities, including, without limitation, covenants related to: (a) limitations on the incurrence of additional indebtedness and liens, (b) limitations on certain investments, (c) limitations on certain restricted payments, (d) maintaining a certain minimum stockholders' equity, (e) maintaining a ratio of total assets (less total liabilities other than indebtedness) to total indebtedness of the Company and its consolidated subsidiaries (subject to certain exceptions) of not less than 1.5:1.0, (f) limitations on pledging certain unencumbered assets, and (g) limitations on the creation or existence of agreements that prohibit liens on certain properties of the Company and certain of its subsidiaries. These covenants are subject to important limitations and exceptions that are described in the documents governing the Revolving Credit Facility. Amounts available to borrow under the Revolving Credit Facility (and the incurrence of certain other permitted debt) are also subject to compliance with a borrowing base that applies different advance rates to different types of assets in the Company's portfolio that are pledged as collateral. As of December 31, 2018, the Company was in compliance in all material respects with the terms of the Revolving Credit Facility.

        As of December 31, 2018 and 2017, there was $1,064 and $395 outstanding, respectively, under the Revolving Credit Facility. As of December 31, 2018, the Revolving Credit Facility also provides for a sub-limit for the issuance of letters of credit for up to an aggregate amount of $150. As of December 31, 2018 and 2017, the Company had $57 and $44, respectively, in letters of credit issued through the Revolving Credit Facility. The amount available for borrowing under the Revolving Credit Facility is reduced by any letters of credit issued. As of December 31, 2018, there was $1,012 available for borrowing (net of letters of credit issued) under the Revolving Credit Facility.

        Since March 30, 2018, the interest rate charged on the Revolving Credit Facility is based on an applicable spread of either 1.75% or 1.875% over LIBOR or 0.75% or 0.875% over an "alternate base rate" (as defined in the agreements governing the Revolving Credit Facility), in each case, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. Prior to March 30, 2018, the interest rate charged on the Revolving Credit Facility was based on an applicable spread of either 1.75% or 2.00% over LIBOR or 0.75% or 1.00% over an "alternate base rate" (as defined in the agreements governing the Revolving Credit Facility), in each case, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. As of December 31, 2018, the interest rate in effect was LIBOR plus 1.75%. As of December 31, 2018, the one, two, three and six month LIBOR was 2.50%, 2.61%, 2.81% and 2.88%, respectively. As of December 31, 2017, the one, two, three and six month LIBOR was 1.56%, 1.62%, 1.69% and 1.84%, respectively. In addition to the stated interest expense on the Revolving Credit Facility, the Company is required to pay a commitment fee of 0.375% per annum on any unused portion of the Revolving Credit Facility. The Company is also required to pay a letter of credit fee of either 2.00% or 2.125% per annum on letters of credit issued, determined monthly based on the total

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amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility.

        In December 2017, the Company entered into an interest rate swap agreement to effectively fix the interest rate in connection with $395 of the term loan tranche of the Revolving Credit Facility. See Note 6 for more information on the interest rate swap.

        The Revolving Credit Facility is secured by certain assets in the Company's portfolio and excludes investments held by Ares Capital CP under the Revolving Funding Facility and those held by ACJB under the SMBC Funding Facility (as defined below), each as described below, and certain other investments.

        For the years ended December 31, 2018, 2017 and 2016, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the Revolving Credit Facility were as follows:

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

Stated interest expense

  $ 17   $ 15   $ 18  

Facility fees

    7     7     2  

Amortization of debt issuance costs

    4     4     3  

Total interest and credit facility fees expense

  $ 28   $ 26   $ 23  

Cash paid for interest expense

  $ 16   $ 15   $ 18  

Average stated interest rate

    3.93 %   2.90 %   2.29 %

Average outstanding balance

  $ 443   $ 514   $ 799  

    Revolving Funding Facility

        The Company's consolidated subsidiary, Ares Capital CP Funding LLC ("Ares Capital CP"), is party to a revolving funding facility (as amended, the "Revolving Funding Facility"), which allows Ares Capital CP to borrow up to $1,000 at any one time outstanding. The Revolving Funding Facility is secured by all of the assets held by, and the membership interest in, Ares Capital CP. The end of the reinvestment period and the stated maturity date for the Revolving Funding Facility are January 3, 2022 and January 3, 2024, respectively.

        Amounts available to borrow under the Revolving Funding Facility are subject to a borrowing base that applies different advance rates to different types of assets held by Ares Capital CP. Ares Capital CP is also subject to limitations with respect to the loans securing the Revolving Funding Facility, including restrictions on sector concentrations, loan size, payment frequency and status, collateral interests, loans with fixed rates and loans with certain investment ratings, as well as restrictions on portfolio company leverage, which may also affect the borrowing base and therefore amounts available to borrow. The Company and Ares Capital CP are also required to comply with various covenants, reporting requirements and other customary requirements for similar facilities. These covenants are subject to important limitations and exceptions that are described in the agreements governing the Revolving Funding Facility. As of December 31, 2018, the Company and Ares Capital CP were in compliance in all material respects with the terms of the Revolving Funding Facility.

        As of December 31, 2018 and 2017, there was $520 and $600 outstanding, respectively, under the Revolving Funding Facility. Since December 14, 2018, the interest rate charged on the Revolving Funding Facility was based on LIBOR plus 2.00% per annum or a "base rate" (as defined in the agreements governing the Revolving Funding Facility) plus 1.00% per annum. From October 2, 2017 to December 13, 2018, the interest rate charged on the Revolving Funding Facility was based on LIBOR

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plus 2.15% per annum or a "base rate" plus 1.15% per annum. From January 4, 2017 to October 1, 2017, the interest rate charged on the Revolving Funding Facility was based on LIBOR plus 2.30% per annum or a "base rate" plus 1.30% per annum. Prior to and including January 3, 2017, the interest rate charged on the Revolving Funding Facility was based on an applicable spread ranging from 2.25% to 2.50% over LIBOR or ranging from 1.25% to 1.50% over a "base rate" in each case, determined monthly based on the composition of the borrowing base relative to outstanding borrowings under the Revolving Funding Facility. Ares Capital CP is also required to pay a commitment fee between 0.50% and 1.50% per annum depending on the size of the unused portion of the Revolving Funding Facility.

        For the years ended December 31, 2018, 2017 and 2016, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the Revolving Funding Facility were as follows:

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

Stated interest expense

  $ 8   $ 17   $ 4  

Facility fees

    8     4     2  

Amortization of debt issuance costs

    3     3     2  

Total interest and credit facility fees expense

  $ 19   $ 24   $ 8  

Cash paid for interest expense

  $ 10   $ 14   $ 3  

Average stated interest rate

    4.16 %   3.41 %   2.80 %

Average outstanding balance

  $ 204   $ 512   $ 142  

    SMBC Funding Facility

        The Company's consolidated subsidiary, Ares Capital JB Funding LLC ("ACJB"), is party to a revolving funding facility (as amended, the "SMBC Funding Facility") with ACJB, as the borrower, and Sumitomo Mitsui Banking Corporation ("SMBC"), as the administrative agent, collateral agent, and lender, that allows ACJB to borrow up to $400 at any one time outstanding. The SMBC Funding Facility is secured by all of the assets held by ACJB. The end of the reinvestment period and the stated maturity date for the SMBC Funding Facility are September 14, 2019 and September 14, 2024, respectively. The reinvestment period and the stated maturity date are both subject to two one-year extensions by mutual agreement.

        Amounts available to borrow under the SMBC Funding Facility are subject to a borrowing base that applies an advance rate to assets held by ACJB. The Company and ACJB are also required to comply with various covenants, reporting requirements and other customary requirements for similar facilities. These covenants are subject to important limitations and exceptions that are described in the documents governing the SMBC Funding Facility. As of December 31, 2018, the Company and ACJB were in compliance in all material respects with the terms of the SMBC Funding Facility.

        As of December 31, 2018 and 2017, there was $245 and $60 outstanding, respectively, under the SMBC Funding Facility. The interest rate charged on the SMBC Funding Facility is based on an applicable spread of either 1.75% or 2.00% over LIBOR or 0.75% or 1.00% over a "base rate" (as defined in the agreements governing the SMBC Funding Facility), in each case, determined monthly based on the amount of the average borrowings outstanding under the SMBC Funding Facility. As of December 31, 2018, the interest rate in effect was LIBOR plus 1.75%. ACJB is required to pay a commitment fee of between 0.35% and 0.875% per annum depending on the size of the unused portion of the SMBC Funding Facility.

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        For the years ended December 31, 2018, 2017 and 2016, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the SMBC Funding Facility were as follows:

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

Stated interest expense

  $ 1   $ 2   $ 3  

Facility fees

    2     1     1  

Amortization of debt issuance costs

    2     1     1  

Total interest and credit facility fees expense

  $ 5   $ 4   $ 5  

Cash paid for interest expense

  $ 1   $ 2   $ 3  

Average stated interest rate

    4.11 %   2.87 %   2.29 %

Average outstanding balance

  $ 29   $ 76   $ 112  

    SBA Debentures

        In April 2015, the Company's consolidated subsidiary, Ares Venture Finance, L.P. ("AVF LP"), received a license from the Small Business Administration ("SBA") to operate as a Small Business Investment Company ("SBIC") under the provisions of Section 301(c) of the Small Business Investment Act of 1958, as amended.

        The license from the SBA allowed AVF LP to obtain leverage by issuing SBA-guaranteed debentures (the "SBA Debentures"), subject to issuance of a capital commitment by the SBA and other customary procedures. Leverage through the SBA Debentures was subject to required capitalization thresholds. The original amount committed to AVF LP by the SBA was $75. In September 2017, AVF LP fully repaid the $25 of the aggregate principal amount of the SBA Debentures outstanding at the time. In April 2018, AVF LP surrendered its license to operate as a SBIC and the undrawn SBA Debenture commitments of $50 were terminated.

        For the years ended December 2017 and 2016, the components of interest expense, cash paid for interest expense, average stated interest rate and average outstanding balances for the SBA Debentures were as follows:

 
  For the Years
Ended
December 31,
 
 
  2017   2016  

Stated interest expense

  $ 1   $ 1  

Amortization of debt issuance costs

         

Total interest and credit facility fees expense

  $ 1   $ 1  

Cash paid for interest expense

  $ 1   $ 1  

Average stated interest rate

    3.48 %   3.41 %

Average outstanding balance

  $ 17   $ 25  

    Convertible Unsecured Notes

        The Company has issued $300 in aggregate principal amount of unsecured convertible notes that mature on January 15, 2019 (the "2019 Convertible Notes") and $388 in aggregate principal amount of unsecured convertible notes that mature on February 1, 2022 (the "2022 Convertible Notes" and together with the 2019 Convertible Notes, the "Convertible Unsecured Notes"). The Convertible Unsecured Notes mature upon their respective maturity dates unless previously converted or

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repurchased in accordance with their terms. The Company does not have the right to redeem the Convertible Unsecured Notes prior to maturity. The 2019 Convertible Notes and the 2022 Convertible Notes bear interest at a rate of 4.375% and 3.75%, respectively, per year, payable semi-annually.

        In certain circumstances, assuming the respective conversion date below has not already passed, the Convertible Unsecured Notes will be convertible into cash, shares of the Company's common stock or a combination of cash and shares of its common stock, at the Company's election, at their respective conversion rates (listed below as of December 31, 2018) subject to customary anti-dilution adjustments and the requirements of their respective indenture (the "Convertible Unsecured Notes Indentures"). To the extent the 2019 Convertible Notes are converted, the Company has elected to settle with a combination of cash and shares of the Company's common stock. Prior to the close of business on the business day immediately preceding their respective conversion date (listed below), holders may convert their Convertible Unsecured Notes only under certain circumstances set forth in the Convertible Unsecured Notes Indentures. On or after their respective conversion dates until the close of business on the scheduled trading day immediately preceding their respective maturity date, holders may convert their Convertible Unsecured Notes at any time. In addition, if the Company engages in certain corporate events as described in their respective Convertible Unsecured Notes Indenture, holders of the Convertible Unsecured Notes may require the Company to repurchase for cash all or part of the Convertible Unsecured Notes at a repurchase price equal to 100% of the principal amount of the Convertible Unsecured Notes to be repurchased, plus accrued and unpaid interest through, but excluding, the required repurchase date.

        Certain key terms related to the convertible features for each of the Convertible Unsecured Notes as of December 31, 2018 are listed below.

 
  2019
Convertible Notes
  2022
Convertible Notes
 

Conversion premium

    15.0 %   15.0 %

Closing stock price at issuance

  $ 17.53   $ 16.86  

Closing stock price date

    July 15, 2013     January 23, 2017  

Conversion price(1)

  $ 19.96   $ 19.37  

Conversion rate (shares per one thousand dollar principal amount)(1)

    50.0897     51.6380  

Conversion dates

    July 15, 2018     August 1, 2021  

(1)
Represents conversion price and conversion rate, as applicable, as of December 31, 2018, taking into account certain de minimis adjustments that will be made on the conversion date.

        As of December 31, 2018, the principal amounts of each series of the Convertible Unsecured Notes exceeded the value of the underlying shares multiplied by the per share closing price of the Company's common stock.

        The Convertible Unsecured Notes Indentures contain certain covenants, including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a)(1) of the Investment Company Act and to provide financial information to the holders of the Convertible Unsecured Notes under certain circumstances. These covenants are subject to important limitations and exceptions that are described in the Convertible Unsecured Notes Indentures. As of December 31, 2018, the Company was in compliance in all material respects with the terms of the Convertible Unsecured Notes Indentures.

        The Convertible Unsecured Notes are accounted for in accordance with ASC 470-20. Upon conversion of any of the other Convertible Unsecured Notes, the Company intends to pay the outstanding principal amount in cash and to the extent that the conversion value exceeds the principal amount, the Company has the option to pay in cash or shares of the Company's common stock (or a

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combination of cash and shares) in respect of the excess amount, subject to the requirements of the Convertible Unsecured Notes Indentures. The Company has determined that the embedded conversion options in the Convertible Unsecured Notes are not required to be separately accounted for as a derivative under GAAP. In accounting for the Convertible Unsecured Notes, the Company estimated at the time of issuance separate debt and equity components for each of the Convertible Unsecured Notes. An original issue discount equal to the equity components of the Convertible Unsecured Notes was recorded in "capital in excess of par value" in the accompanying consolidated balance sheet. Additionally, the issuance costs associated with the Convertible Unsecured Notes were allocated to the debt and equity components in proportion to the allocation of the proceeds and accounted for as debt issuance costs and equity issuance costs, respectively.

        The debt and equity component percentages, the issuance costs and the equity component amounts for each of the Convertible Unsecured Notes are listed below.

 
  2019
Convertible Notes
  2022
Convertible Notes
 

Debt and equity component percentages, respectively(1)

    99.8% and 0.2 %   96.0% and 4.0 %

Debt issuance costs(1)

  $ 4   $ 9  

Equity issuance costs(1)

  $   $  

Equity component, net of issuance costs(2)

  $ 1   $ 15  

(1)
At time of issuance.

(2)
At time of issuance and as of December 31, 2018.

        In addition to the original issue discount equal to the equity component of the 2019 Convertible Notes, the 2019 Convertible Notes were issued at a discount. The Company records interest expense comprised of both stated interest expense as well as accretion of any original issue discount.

        As of December 31, 2018, the components of the carrying value of the Convertible Unsecured Notes, the stated interest rate and the effective interest rate were as follows:

 
  2019
Convertible Notes
  2022
Convertible Notes
 

Principal amount of debt

  $ 300   $ 388  

Original issue discount, net of accretion

        (10 )

Debt issuance costs

        (6 )

Carrying value of debt

  $ 300   $ 372  

Stated interest rate

    4.375 %   3.750 %

Effective interest rate(1)

    4.7 %   4.5 %

(1)
The effective interest rate of the debt component of the Convertible Unsecured Notes is equal to the stated interest rate plus the accretion of original issue discount.

        In January 2018, the Company repaid in full the $270 in aggregate principal amount of unsecured convertible notes (the "2018 Convertible Notes") upon their maturity. The 2018 Convertible Notes bore interest at a rate of 4.75% per year, payable semi-annually.

        See Note 18 for a subsequent event regarding the 2019 Convertible Notes.

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        For the years ended December 31, 2018, 2017 and 2016, the components of interest expense and cash paid for interest expense for the Convertible Unsecured Notes, as well as any other convertible unsecured notes outstanding during the periods presented are listed below.

 
  For the Years Ended December 31,  
 
  2018   2017   2016  

Stated interest expense

  $ 28   $ 41   $ 42  

Amortization of debt issuance costs

    3     4     4  

Accretion of original issue discount

    3     5     6  

Total interest expense

  $ 34   $ 50   $ 52  

Cash paid for interest expense

  $ 34   $ 37   $ 56  

    Unsecured Notes

    2018 Notes

        The Company had issued $750 in aggregate principal amount of unsecured notes that matured and were fully repaid on November 30, 2018 (the "2018 Notes"). The 2018 Notes bore interest at a rate of 4.875% per year, payable semi-annually.

    2020 Notes

        The Company has issued $600 in aggregate principal amount of unsecured notes that mature on January 15, 2020 (the "2020 Notes"). The 2020 Notes bear interest at a rate of 3.875% per year, payable semi-annually and all principal is due upon maturity. The 2020 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2020 Notes, and any accrued and unpaid interest. $400 in aggregate principal amount of the 2020 Notes were issued at a discount to the principal amount and $200 in aggregate principal amount of the 2020 Notes were issued at a premium to the principal amount.

    2022 Notes

        The Company has issued $600 in aggregate principal amount of unsecured notes that mature on January 19, 2022 (the "2022 Notes"). The 2022 Notes bear interest at a rate of 3.625% per year, payable semi-annually and all principal is due upon maturity. The 2022 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2022 Notes, and any accrued and unpaid interest. The 2022 Notes were issued at a discount to the principal amount.

    2023 Notes

        The Company has issued $750 in aggregate principal amount of unsecured notes that mature on February 10, 2023 (the "2023 Notes"). The 2023 Notes bear interest at a rate of 3.500% per year, payable semi-annually and all principal is due upon maturity. The 2023 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2023 Notes, and any accrued and unpaid interest. The 2023 Notes were issued at a discount to the principal amount.

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    2025 Notes

         The Company has issued $600 in aggregate principal amount of unsecured notes that mature on March 1, 2025 (the "2025 Notes"). The 2025 Notes bear interest at a rate of 4.250% per year, payable semi-annually and all principal is due upon maturity. The 2025 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2025 Notes, and any accrued and unpaid interest. The 2025 Notes were issued at a discount to the principal amount.

    2047 Notes

        As part of the acquisition of Allied Capital Corporation ("Allied Capital") in April 2010 (the "Allied Acquisition"), the Company assumed $230 in aggregate principal amount of unsecured notes due on April 15, 2047 (the "2047 Notes" and together with the 2018 Notes, the 2020 Notes, the 2022 Notes, the 2023 Notes and the 2025 Notes, the "Unsecured Notes"). The 2047 Notes bear interest at a rate of 6.875%, payable quarterly and all principal is due upon maturity. The 2047 Notes may be redeemed in whole or in part at any time or from time to time at the Company's option, at a par redemption price of $25.00 per security plus accrued and unpaid interest.

        For the years ended December 31, 2018, 2017 and 2016, the components of interest expense and cash paid for interest expense for the Unsecured Notes, as well as any other unsecured notes outstanding during the periods presented are listed below.

 
  For the Years Ended December 31,  
 
  2018   2017   2016  

Stated interest expense

  $ 146   $ 113   $ 93  

Amortization of debt issuance costs

    6     6     4  

Net accretion of original issue discount

    1     1      

Accretion of purchase discount

    1          

Total interest expense

  $ 154   $ 120   $ 97  

Cash paid for interest expense

  $ 140   $ 102   $ 87  

        The Unsecured Notes contain certain covenants, including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a)(1) of the Investment Company Act and to provide financial information to the holders of such notes under certain circumstances. These covenants are subject to important limitations and exceptions set forth in the indentures governing such notes. As of December 31, 2018, the Company was in compliance in all material respects with the terms of the respective indentures governing each of the Unsecured Notes.

        The Convertible Unsecured Notes and the Unsecured Notes are the Company's unsecured senior obligations and rank senior in right of payment to any future indebtedness that is expressly subordinated in right of payment to the Convertible Unsecured Notes and the Unsecured Notes; equal in right of payment to the Company's existing and future unsecured indebtedness that is not expressly subordinated; effectively junior in right of payment to any of its secured indebtedness (including existing unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company's subsidiaries, financing vehicles or similar facilities.

6.     DERIVATIVE INSTRUMENTS

        The Company enters into forward currency contracts from time to time to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the Company's

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investments denominated in foreign currencies. As of December 31, 2018 and 2017, the counterparty to these forward currency contracts was Bank of Montreal. Net unrealized gains or losses on foreign currency contracts are included in "net unrealized gains (losses) from foreign currency and other transactions" and net realized gains or losses on forward currency contracts are included in "net realized gains (losses) from foreign currency transactions" in the accompanying consolidated statement of operations.

        Forward currency contracts and interest rate swaps are considered undesignated derivative instruments.

        Certain information related to the Company's foreign currency forward contracts is presented below as of December 31, 2018 and 2017.

 
  As of December 31, 2018
Description
  Notional
Amount
  Maturity Date   Gross
Amount
of Recognized
Assets
  Gross
Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Foreign currency forward contract

  CAD 5     1/4/2019           Other Assets

Foreign currency forward contract

  CAD 9     1/14/2019           Other Assets

Foreign currency forward contract

  CAD 103     2/15/2019     2       Other Assets

Foreign currency forward contract

  CAD 33     3/22/2019           Other Assets

Foreign currency forward contract

  15     1/14/2019           Other Assets

Foreign currency forward contract

  1     2/15/2019           Accounts payable and other liabilities

Foreign currency forward contract

  24     3/6/2019           Accounts payable and other liabilities

Foreign currency forward contract

  £ 72     2/15/2019     2       Other Assets

Total

              $ 4   $    

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  As of December 31, 2017
Description
  Notional
Amount
  Maturity Date   Gross
Amount
of Recognized
Assets
  Gross
Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Foreign currency forward contract

  CAD 4     1/4/2018   $   $   Other Assets

Foreign currency forward contract

  CAD 10     1/16/2018           Other Assets

Foreign currency forward contract

  CAD 103     2/16/2018         (1 ) Accounts payable and other liabilities

Foreign currency forward contract

  15     1/16/2018           Accounts payable and other liabilities

Foreign currency forward contract

  8     2/15/2018           Accounts payable and other liabilities

Foreign currency forward contract

  2     3/15/2018           Accounts payable and other liabilities

Foreign currency forward contract

  £ 68     2/15/2018         (2 ) Accounts payable and other liabilities

Foreign currency forward contract

  £ 9     2/16/2018           Accounts payable and other liabilities

Total

              $   $ (3 )  

        In December 2017, in connection with $395 of the term loan tranche of the Revolving Credit Facility the Company entered into a three-year interest rate swap agreement to mitigate our exposure to adverse fluctuations in interest rates for a total notional amount of $395 and a maturity date of January 4, 2021. Under the interest rate swap agreement, the Company pays a fixed interest rate of 2.06% and receives a floating rate based on the prevailing one-month LIBOR. As of December 31, 2018 and 2017, the one-month LIBOR rate in effect was 2.44%% and 1.50%, respectively. For the years ended December 31, 2018 and 2017, the Company recognized $0 and $0, respectively, in realized losses and $4 and $0, respectively, in unrealized gains related to this swap agreement. As of December 31, 2018 and 2017, this swap agreement had a fair value of $4 and $(1), respectively, which is included in the "other assets" and "accounts payable and other liabilities", respectively, in the accompanying consolidated balance sheet. Net realized gains or losses on the interest rate swap are included in "net realized gains (losses) from foreign currency and other transactions" in the accompany consolidated statements of operations. Net unrealized gains or losses on the interest rate swap are included in "net unrealized gains (losses) from foreign currency and other transactions" in the accompanying consolidated statements of operations.

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        Certain information related to the Company's interest rate swap is presented below as of December 31, 2018 and 2017.

 
  As of December 31, 2018
Description
  Payment Terms   Notional
Amount
  Maturity
Date
  Gross
Amount of
Recognized
Assets
  Gross
Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Interest rate swap

    Pay fixed 2.0642 % Receive Floating One-Month LIBOR of 2.44%   $ 395     1/4/2021   $ 4   $   Other assets

Total

                        $ 4   $    

 

 
  As of December 31, 2017
Description
  Payment Terms   Notional
Amount
  Maturity
Date
  Gross
Amount
of Recognized
Assets
  Gross
Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Interest rate swap

    Pay Fixed 2.0642 % Receive Floating One-Month LIBOR of 1.50%   $ 395     1/4/2021   $   $ (1 ) Accounts payable and other liabilities

Total

                        $   $ (1 )  

7.     COMMITMENTS AND CONTINGENCIES

        The Company has various commitments to fund investments in its portfolio as described below. As of December 31, 2018 and 2017, the Company had the following commitments to fund various revolving and delayed draw senior secured and subordinated loans, including commitments to fund which are at (or substantially at) the Company's discretion:

 
  As of
December 31,
 
 
  2018   2017  

Total revolving and delayed draw loan commitments

  $ 1,915   $ 881  

Less: drawn commitments

    (377 )   (201 )

Total undrawn commitments

    1,538     680  

Less: commitments substantially at discretion of the Company

    (6 )   (11 )

Less: unavailable commitments due to borrowing base or other covenant restrictions

         

Total net adjusted undrawn revolving and delayed draw loan commitments

  $ 1,532   $ 669  

        Included within the total revolving and delayed draw loan commitments as of December 31, 2018 and 2017 were delayed draw loan commitments totaling $627 and $251, respectively. The Company's commitment to fund delayed draw loans is triggered upon the satisfaction of certain pre-negotiated terms and conditions. Generally, the most significant and uncertain term requires the borrower to satisfy a specific use of proceeds covenant. The use of proceeds covenant typically requires the borrower to use the additional loans for the specific purpose of a permitted acquisition or permitted investment, for example. In addition to the use of proceeds covenant, the borrower is generally required to satisfy additional negotiated covenants (including specified leverage levels).

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        Also included within the total revolving and delayed draw loan commitments as of December 31, 2018 were commitments to issue up to $248 in letters of credit through a financial intermediary on behalf of certain portfolio companies. As of December 31, 2018, the Company had $26 in letters of credit issued and outstanding under these commitments on behalf of portfolio companies. For all these letters of credit issued and outstanding, the Company would be required to make payments to third parties if the portfolio companies were to default on their related payment obligations. Of these letters of credit, $23 expire in 2019 and $3 expire in 2020. As of December 31, 2018, the Company recorded a liability of $1 for certain letters of credit issued and outstanding and none of the other letters of credit issued and outstanding were recorded as a liability on the Company's balance sheet as such other letters of credit are considered in the valuation of the investments in the portfolio company.

        The Company also has commitments to co-invest in the SDLP for the Company's portion of the SDLP's commitments to fund delayed draw loans to certain portfolio companies of the SDLP. See Note 4 for more information.

        As of December 31, 2018 and 2017, the Company was party to subscription agreements to fund equity investments in private equity investment partnerships as follows:

 
  As of
December 31,
 
 
  2018   2017  

Total private equity commitments

  $ 114   $ 111  

Less: funded private equity commitments

    (73 )   (62 )

Total unfunded private equity commitments

    41     49  

Less: private equity commitments substantially at discretion of the Company

    (41 )   (48 )

Total net adjusted unfunded private equity commitments

  $   $ 1  

        In the ordinary course of business, the Company may sell certain of its investments to third party purchasers. In particular, in connection with the sale of certain controlled portfolio company equity investments (as well as certain other sales) the Company has, and may continue to do so in the future, agreed to indemnify such purchasers for future liabilities arising from the investments and the related sale transaction. Such indemnification provisions have given rise to liabilities in the past and may do so in the future.

        In addition, in the ordinary course of business, the Company may guarantee certain obligations in connection with its portfolio companies (in particular, certain controlled portfolio companies). Under these guarantee arrangements, payments may be required to be made to third parties if such guarantees are called upon or if the portfolio companies were to default on their related obligations, as applicable.

    Lease Commitments

        The Company is obligated under a number of operating leases for office spaces with remaining terms ranging from less than one year to 8 years. For certain of its operating leases, the Company has entered into subleases including one with Ares Management. See Note 13 for a further description of the sublease with Ares Management. Total rent expense incurred by the Company for leases assumed as part of the American Capital Acquisition for the years ended December 31, 2018 and 2017 was $1 and $1, respectively, and is included in "professional fees and other costs related to the American Capital Acquisition" in the accompanying consolidated statement of operations. Total rent expense incurred by the Company, other than the leases assumed as part of the American Capital Acquisition, for the years ended December 31, 2018, 2017 and 2016 was $0, $3 and $4, respectively, and is included

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in "other general and administrative" expenses in the accompanying consolidated statement of operations.

        The following table shows future minimum payments under the Company's operating leases as of December 31, 2018:

For the Years Ending December 31,
  Amount  

2019

  $ 25  

2020

    24  

2021

    24  

2022

    24  

2023

    25  

Thereafter

    37  

Total

  $ 159  

        The following table shows future expected rental payments to be received under the Company's subleases where the Company is the sublessor as of December 31, 2018:

For the Years Ending December 31,
  Amount  

2019

  $ 19  

2020

    18  

2021

    18  

2022

    17  

2023

    17  

Thereafter

    31  

Total

  $ 120  

8.     FAIR VALUE OF FINANCIAL INSTRUMENTS

        The Company follows ASC 825-10, which provides companies the option to report selected financial assets and liabilities at fair value. ASC 825-10 also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect of the company's choice to use fair value on its earnings. ASC 825-10 also requires entities to display the fair value of the selected assets and liabilities on the face of the balance sheet. The Company has not elected the ASC 825-10 option to report selected financial assets and liabilities at fair value. With the exception of the line items entitled "other assets" and "debt," which are reported at amortized cost, all assets and liabilities approximate fair value on the balance sheet. The carrying value of the lines titled "interest receivable," "receivable for open trades," "payable for open trades," "accounts payable and other liabilities," "base management fees payable," "income based fees payable," "capital gains incentive fees payable" and "interest and facility fees payable" approximate fair value due to their short maturity.

        The Company also follows ASC 820-10, which expands the application of fair value accounting. ASC 820-10 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosure of fair value measurements. ASC 820-10 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Company to assume that the portfolio investment is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market, which may be a hypothetical market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are

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independent, knowledgeable, and willing and able to transact. In accordance with ASC 820-10, the Company has considered its principal market as the market in which the Company exits its portfolio investments with the greatest volume and level of activity. ASC 820-10 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. In accordance with ASC 820-10, these inputs are summarized in the three broad levels listed below:

    Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

    Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

    Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

        In addition to using the above inputs in investment valuations, the Company continues to employ the net asset valuation policy approved by the Company's board of directors that is consistent with ASC 820-10 (see Note 2). Consistent with the Company's valuation policy, it evaluates the source of inputs, including any markets in which the Company's investments are trading (or any markets in which securities with similar attributes are trading), in determining fair value. The Company's valuation policy considers the fact that because there is not a readily available market value for most of the investments in the Company's portfolio, the fair value of the investments must typically be determined using unobservable inputs.

        The Company's portfolio investments (other than as described below in the following paragraph) are typically valued using two different valuation techniques. The first valuation technique is an analysis of the enterprise value ("EV") of the portfolio company. Enterprise value means the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time. The primary method for determining EV uses a multiple analysis whereby appropriate multiples are applied to the portfolio company's EBITDA (generally defined as net income before net interest expense, income tax expense, depreciation and amortization). EBITDA multiples are typically determined based upon review of market comparable transactions and publicly traded comparable companies, if any. The Company may also employ other valuation multiples to determine EV, such as revenues or, in the case of certain portfolio companies in the power generation industry, kilowatt capacity. The second method for determining EV uses a discounted cash flow analysis whereby future expected cash flows of the portfolio company are discounted to determine a present value using estimated discount rates (typically a weighted average cost of capital based on costs of debt and equity consistent with current market conditions). The EV analysis is performed to determine the value of equity investments, the value of debt investments in portfolio companies where the Company has control or could gain control through an option or warrant security, and to determine if there is credit impairment for debt investments. If debt investments are credit impaired, an EV analysis may be used to value such debt investments; however, in addition to the methods outlined above, other methods such as a liquidation or wind-down analysis may be utilized to estimate enterprise value. The second valuation technique is a yield analysis, which is typically performed for non-credit impaired debt investments in portfolio companies where the Company does not own a controlling equity position. To determine fair value using a yield analysis, a current price is imputed for the investment based upon an assessment of the expected market yield for a similarly structured investment with a similar level of risk. In the yield analysis, the Company considers the current contractual interest rate, the maturity and other terms of the investment relative to risk of the company and the specific investment. A key determinant of risk, among other things, is the leverage through the investment relative to the enterprise value of the portfolio company. As debt investments held by the Company are substantially illiquid with no active transaction market, the Company depends on primary market data, including newly funded transactions, as well as secondary

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market data with respect to high yield debt instruments and syndicated loans, as inputs in determining the appropriate market yield, as applicable.

        For other portfolio investments such as investments in the SDLP Certificates, discounted cash flow analysis is the primary technique utilized to determine fair value. Expected future cash flows associated with the investment are discounted to determine a present value using a discount rate that reflects estimated market return requirements.

        The following tables summarize the significant unobservable inputs the Company used to value the majority of its investments categorized within Level 3 as of December 31, 2018 and 2017. The tables are not intended to be all-inclusive, but instead capture the significant unobservable inputs relevant to the Company's determination of fair values.

 
  As of December 31, 2018  
 
   
   
  Unobservable Input  
Asset Category
  Fair
Value
  Primary
Valuation Techniques
  Input   Estimated
Range
  Weighted
Average
 

First lien senior secured loans

  $ 5,836   Yield analysis   Market yield   5.4% - 17.1%     9.2 %

Second lien senior secured loans

    3,657   Yield analysis   Market yield   9.8% - 20.2%     11.9 %

Subordinated certificates of the SDLP

    652   Discounted cash flow analysis   Discount rate   12.5% - 13.5%     13.0 %

Senior subordinated loans

    727   Yield analysis   Market yield   10.0% - 16.8%     13.0 %

Collateralized loan obligations

    45   Discounted cash flow analysis   Discount rate   10.0% - 15.6%     14.1 %

            Constant prepayment rate   10.0% - 30.0%     20.0 %

            Constant default rate   1.0% - 2.5%     2.0 %

Preferred equity securities

    444   EV market multiple analysis   EBITDA multiple   4.2x - 20.0x     12.9x  

Other equity securities and other

    1,046   EV market multiple analysis   EBITDA multiple   5.0x - 22.9x     10.8x  

Total investments

  $ 12,407                    

 

 
  As of December 31, 2017  
 
   
   
  Unobservable Input  
Asset Category
  Fair
Value
  Primary
Valuation Techniques
  Input   Estimated
Range
  Weighted
Average
 

First lien senior secured loans

  $ 5,197   Yield analysis   Market yield   4.2% - 19.8%     8.7 %

Second lien senior secured loans

    3,744   Yield analysis   Market yield   8.7% - 17.5%     10.9 %

Subordinated certificates of the SDLP

    487   Discounted cash flow analysis   Discount rate   11.5% - 12.5%     12.0 %

Senior subordinated loans

    995   Yield analysis   Market yield   9.7% - 17.5%     13.2 %

Collateralized loan obligations

    114   Discounted cash flow analysis   Discount rate   4.3% - 16.4%     10.2 %

            Constant prepayment rate   18.7% - 27.1%     21.8 %

            Constant default rate   1.8% - 2.6%     2.3 %

Preferred equity securities

    532   EV market multiple analysis   EBITDA multiple   3.0x - 19.0x     11.2 x

Other equity securities and other

    755   EV market multiple analysis   EBITDA multiple   3.5x - 19.0x     10.4 x

Total investments

  $ 11,824                    

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        Changes in market yields, discount rates or EBITDA multiples, each in isolation, may change the fair value of certain of the Company's investments. Generally, an increase in market yields or discount rates or decrease in EBITDA multiples may result in a decrease in the fair value of certain of the Company's investments.

        Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Company's investments may fluctuate from period to period. Additionally, the fair value of the Company's investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that the Company may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If the Company was required to liquidate a portfolio investment in a forced or liquidation sale, it could realize significantly less than the value at which the Company has recorded it.

        In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected in the valuations currently assigned.

        The following table presents fair value measurements of cash and cash equivalents, investments and derivatives as of December 31, 2018:

 
  Fair Value Measurements Using  
 
  Total   Level 1   Level 2   Level 3  

Cash and cash equivalents

  $ 296   $ 296   $   $  

Investments not measured at net asset value

  $ 12,407   $   $   $ 12,407  

Investments measured at net asset value(1)

    10                    

Total investments

  $ 12,417                    

Derivatives

  $ 8   $   $ 8   $  

(1)
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet.

        The following table presents fair value measurements of cash and cash equivalents, investments and derivatives as of December 31, 2017:

 
  Fair Value Measurements Using  
 
  Total   Level 1   Level 2   Level 3  

Cash and cash equivalents

  $ 316   $ 316   $   $  

Investments not measured at net asset value

  $ 11,824   $   $   $ 11,824  

Investments measured at net asset value(1)

    17                    

Total investments

  $ 11,841                    

Derivatives

  $ (4 ) $   $ (4 ) $  

(1)
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet.

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        The following table presents changes in investments that use Level 3 inputs as of and for the year ended December 31, 2018:

 
  As of and For the
Year Ended
December 31, 2018
 

Balance as of December 31, 2017

  $ 11,824  

Net realized gains

    406  

Net unrealized losses

    (271 )

Purchases

    7,135  

Sales

    (2,614 )

Redemptions

    (4,179 )

Payment-in-kind interest and dividends

    94  

Net accretion of discount on securities

    12  

Net transfers in and/or out of Level 3

     

Balance as of December 31, 2018

  $ 12,407  

        As of December 31, 2018, the net unrealized depreciation on the investments that use Level 3 inputs was $353. For the year ended December 31, 2018, there were no net transfers out of Level 3.

        For the year ended December 31, 2018, the total amount of gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to the Company's Level 3 assets still held as of December 31, 2018, and reported within the net unrealized gains (losses) from investments, foreign currency and other transactions in the Company's consolidated statement of operations was $(137).

        The following table presents changes in investments that use Level 3 inputs as of and for the year ended December 31, 2017:

 
  As of and For the
Year Ended
December 31, 2017
 

Balance as of December 31, 2016

  $ 8,813  

Net realized gains

    43  

Net unrealized gains

    141  

Investments acquired as part of the American Capital Acquisition

    2,527  

Purchases

    7,228  

Sales

    (1,838 )

Redemptions

    (5,179 )

Payment-in-kind interest and dividends

    79  

Net accretion of discount on securities

    10  

Net transfers in and/or out of Level 3

     

Balance as of December 31, 2017

  $ 11,824  

        As of December 31, 2017, the net unrealized depreciation on the investments that use Level 3 inputs was $82. For the year ended December 31, 2017, the net transfers out of Level 3 were due to privately held equity investments converting to publicly traded stock.

        For the year ended December 31, 2017, the total amount of gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to the Company's Level 3 assets still held as of December 31, 2017, and reported within the net unrealized gains (losses) from investments, foreign currency and other transactions in the Company's consolidated statement of operations was $107.

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        Following are the carrying and fair values of the Company's debt obligations as of December 31, 2018 and 2017. Fair value is estimated by discounting remaining payments using applicable current market rates, which take into account changes in the Company's marketplace credit ratings, or market quotes, if available.

 
  As of December 31,  
 
  2018   2017  
 
  Carrying
value(1)
  Fair
value
  Carrying
value(1)
  Fair
value
 

Revolving Credit Facility

  $ 1,064   $ 1,064   $ 395   $ 395  

Revolving Funding Facility

    520     520     600     600  

SMBC Funding Facility

    245     245     60     60  

2018 Convertible Notes (principal amount outstanding of $0 and $270, respectively)

    (2)       270 (2)   270  

2019 Convertible Notes (principal amount outstanding of $300)

    300 (2)   300     298 (2)   307  

2022 Convertible Notes (principal amount outstanding of $388)

    372 (2) $ 388     368 (2)   398  

2018 Notes (principal amount outstanding of $0 and $750, respectively)

            748 (3)   767  

2020 Notes (principal amount outstanding of $600)

    598 (4)   602     597 (4)   611  

2022 Notes (principal amount outstanding of $600)

    595 (5)   584     593 (5)   603  

2023 Notes (principal amount outstanding of $750)

    744 (6)   711     743 (6)   740  

2025 Notes (principal amount outstanding of $600 and $0, respectively)

    593 (7)   570          

2047 Notes (principal amount outstanding of $230)

    183 (8)   224     182 (8)   231  

  $ 5,214 (9) $ 5,208   $ 4,854 (9) $ 4,982  

(1)
The Revolving Credit Facility, the Revolving Funding Facility and the SMBC Funding Facility carrying values are the same as the principal amounts outstanding.

(2)
Represents the aggregate principal amount outstanding of the Convertible Unsecured Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuances of such notes.

(3)
Represents the aggregate principal amount outstanding of the 2018 Notes less unamortized debt issuance costs plus the net unamortized premium recorded upon the issuances of the 2018 Notes.

(4)
Represents the aggregate principal amount outstanding of the 2020 Notes less unamortized debt issuance costs and the net unaccreted discount recorded upon the issuances of the 2020 Notes.

(5)
Represents the aggregate principal amount outstanding of the 2022 Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2022 Notes.

(6)
Represents the aggregate principal amount outstanding of the 2023 Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2023 Notes.

(7)
Represents the aggregate principal amount outstanding of the 2025 Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2025 Notes.

(8)
Represents the aggregate principal amount outstanding of the 2047 Notes less the unaccreted purchased discount.

(9)
Total principal amount of debt outstanding totaled $5,297 and $4,943 as of December 31, 2018 and 2017, respectively.

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        The following table presents fair value measurements of the Company's debt obligations as of December 31, 2018 and 2017:

 
  As of
December 31,
 
Fair Value Measurements Using
  2018   2017  

Level 1

  $ 224   $ 231  

Level 2

    4,984     4,751  

Total

  $ 5,208   $ 4,982  

9.     STOCKHOLDERS' EQUITY

        There were no issuances of the Company's equity securities for the years ended December 31, 2018, 2017 and 2016 except for in connection with the American Capital Acquisition. In connection with the American Capital Acquisition, the Company issued 112 shares valued at approximately $1,839. See Note 16 for additional information regarding the American Capital Acquisition. See Note 12 for information regarding shares of common stock issued or purchased in accordance with the Company's dividend reinvestment plan.

    Stock Repurchase Program

        The Company is authorized under its stock repurchase program to purchase up to $300 (as of December 31, 2018) in the aggregate of its outstanding common stock in the open market at certain thresholds below its net asset value per share, in accordance with the guidelines specified in Rule 10b-18 under the Securities Exchange Act of 1934, as amended. The timing, manner, price and amount of any share repurchases will be determined by the Company, in its discretion, based upon the evaluation of economic and market conditions, stock price, applicable legal and regulatory requirements and other factors. The program does not require the Company to repurchase any specific number of shares, and the Company cannot assure stockholders that any shares will be repurchased under the program. The expiration date of the stock repurchase program is February 28, 2019. The program may be suspended, extended, modified or discontinued at any time. See Note 18 for a subsequent event relating to the Company's stock repurchase program.

        As of December 31, 2018, the Company had repurchased a total of 0.5 shares of its common stock in the open market under the stock repurchase program since the program's inception in September 2015, at an average price of $13.92 per share, including commissions paid, leaving approximately $293 available for additional repurchases under the program. During the years ended December 31, 2018 and 2017, the Company did not repurchase any shares of the Company's common stock under the stock repurchase program.

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10.   EARNINGS PER SHARE

        The following information sets forth the computations of basic and diluted net increase in stockholders' equity resulting from operations per share for the years ended December 31, 2018, 2017 and 2016:

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

Net increase in stockholders' equity resulting from operations available to common stockholders

  $ 858   $ 667   $ 474  

Weighted average shares of common stock outstanding—basic and diluted

    426     425     314  

Basic and diluted net increase in stockholders' equity resulting from operations per share

  $ 2.01   $ 1.57   $ 1.51  

        For the purpose of calculating diluted net increase in stockholders' equity resulting from operations per share, the average closing price of the Company's common stock for the year ended December 31, 2018 was less than the conversion price for each of the Convertible Unsecured Notes outstanding as of December 31, 2018, as well as any other convertible unsecured notes outstanding during the period. For the year ended December 31, 2017, the average closing price of the Company's common stock was less than the conversion price for each of the Convertible Unsecured Notes outstanding as of December 31, 2017, as well as any other convertible unsecured notes outstanding during the period. For the year ended December 31, 2016, the average closing price of the Company's common stock was less than the conversion price for each of the Convertible Unsecured Notes outstanding as of December 31, 2016, as well as any other convertible unsecured notes outstanding during the period.Therefore, for all periods presented in the financial statements, the underlying shares for the intrinsic value of the embedded options in the Convertible Unsecured Notes and any other convertible unsecured notes outstanding during the periods presented had no impact on the computation of diluted net increase in stockholders' equity resulting from operations per share.

11.   INCOME AND EXCISE TAXES

        For U.S. federal income tax purposes, amounts distributed to the Company's stockholders as dividends are reported as ordinary income, capital gains, or a combination thereof. Dividends paid per common share for the years ended December 31, 2018, 2017 and 2016 were taxable as follows (unaudited):

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

Ordinary income(1)

  $ 1.54   $ 1.45   $ 1.26  

Capital gains

        0.07     0.26  

Total(2)

  $ 1.54   $ 1.52   $ 1.52  

(1)
For the year ended December 31, 2018, ordinary income did not include dividend income that qualified to be taxed at the maximum capital gains rate or, in case of certain eligible corporate shareholders, dividends eligible for the dividends received deduction. For the years ended December 31, 2017 and 2016, ordinary income included dividend income of approximately $0.0296 and $0.0892, per share, respectively, that qualified to be taxed at the maximum capital gains rate and, in the case of certain eligible corporate shareholders, dividends that were eligible for the dividends received deduction.

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(2)
For the years ended December 31, 2018, 2017 and 2016, the percentage of total dividends paid that constituted interest-related dividends were 85.4%, 86.8% and 81.4%, respectively.

        The following reconciles net increase in stockholders' equity resulting from operations to taxable income for the years ended December 31, 2018, 2017 and 2016:

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  
 
  (Estimated)(1)
   
   
 

Net increase in stockholders' equity resulting from operations

  $ 858   $ 667   $ 474  

Adjustments:

                   

Net unrealized losses (gains) on investments, foreign currency and other transactions

    255     (136 )   130  

Income not currently taxable

    (96 )   (114 )   (59 )

Income for tax but not book

    62     224     57  

Expenses not currently deductible

    52     96     37  

Expenses for tax but not book

    (78 )   (24 )   (6 )

Realized gain/loss differences(2)

    (433 )   (47 )   (78 )

Taxable income

  $ 620   $ 666   $ 555  

(1)
The calculation of estimated 2018 U.S. federal taxable income is based on certain estimated amounts, including information received from third parties and, as a result, actual 2018 U.S. federal taxable income will not be finally determined until the Company's 2018 U.S. federal tax return is filed in 2019 (and, therefore, such estimate is subject to change).

(2)
Certain realized gain/loss differences are the result of the realization of certain tax only capital losses on the investments acquired in the Allied Acquisition. Because the Allied Acquisition was a "tax-free" reorganization under the Code, realized losses for tax purposes can differ from GAAP. Note that unlike the Allied Acquisition, the American Capital Acquisition was treated as a taxable purchase of the American Capital assets for purposes of the Company's taxable income calculations; therefore, realized gains or losses for tax purposes are generally consistent with realized gains or losses under GAAP.

        Taxable income generally differs from net increase in stockholders' equity resulting from operations for financial reporting purposes due to temporary and permanent differences in the recognition of income and expenses, and generally excludes net unrealized gains or losses, as unrealized gains or losses are generally not included in taxable income until they are realized. In addition, on April 1, 2010, the Company acquired Allied Capital in a "tax-free" merger under the Code, which has caused certain merger-related items to vary in their deductibility for GAAP and tax purposes.

        Capital losses in excess of capital gains earned in a tax year may generally be carried forward and used to offset capital gains, subject to certain limitations. As of December 31, 2018, the Company estimates that it will have a capital loss carryforward of approximately $46 available for use in later tax years. While the Company's ability to utilize losses in the future depends on a variety of factors that cannot be known in advance, substantially all of the capital loss carryforward will be subject to limitations under Section 382 of the Code. The unused balance will be carried forward and utilized as gains are realized, subject to such limitations.

        For the year ended December 31, 2018, the Company estimated U.S. federal taxable income exceeded its distributions made from such taxable income during the year; consequently, the Company has elected to carry forward the excess for distribution to shareholders in 2019. The amount carried

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forward to 2019 is estimated to be approximately $323, all of which is expected to be ordinary income, although these amounts will not be finalized until the 2018 tax returns are filed in 2019. For the years ended December 31, 2017 and 2016, the Company had taxable income in excess of the distributions made from such taxable income during the year, and therefore, the Company elected to carry forward the excess for distribution to shareholders in 2018 and 2017, respectively. The amounts carried forward to 2018 and 2017 were $358 and $339, respectively. To the extent that the Company determines that its estimated current year annual taxable income will exceed its estimated current year dividends from such taxable income, the Company accrues excise tax on estimated excess taxable income. For the years ended December 31, 2018, 2017 and 2016, a net expense of $14, $12 and $12, respectively, was recorded for U.S. federal excise tax. The net expense for the years ended December 31, 2017 and 2016 each included a reduction in expense related to an expected refund request arising from the overpayment of the prior year's excise tax of $1 and $1, respectively.

        As of December 31, 2018, the estimated cost basis of investments for U.S. federal tax purposes was $13.0 billion resulting in estimated gross unrealized gains and losses of $0.3 billion and $0.9 billion, respectively. As of December 31, 2017, the estimated cost basis of investments for U.S. federal tax purposes was $12.7 billion resulting in estimated gross unrealized gains and losses of $0.5 billion and $1.3 billion, respectively. As of December 31, 2018 and 2017, the cost of investments for U.S. federal tax purposes was greater than the amortized cost of investments for book purposes of $12.8 billion and $11.9 billion, respectively, primarily as a result of the carryover of tax basis in excess of the related GAAP basis in connection with the Allied Acquisition. The Allied Acquisition qualified as a "tax-free" reorganization under the Code, which resulted in the assets acquired by the Company retaining Allied Capital's tax cost basis at the merger date.

        The Company may adjust the classification of stockholders' equity as a result of permanent book-to-tax differences, which may include merger-related items, differences in the book and tax basis of certain assets and liabilities, and nondeductible federal taxes, among other items. As of December 31, 2018, the tax basis of capital in excess of par value, accumulated overdistributed net investment income, accumulated undistributed net realized gains and net unrealized losses were $7,173, $(24), $491 and $(340), respectively. As of December 31, 2017, the tax basis of capital in excess of par value, accumulated overdistributed net investment income, accumulated undistributed net realized gains and net unrealized losses were $7,192, $(81), $72 and $(85), respectively. During the year ended December 31, 2018, the Company decreased capital in excess of par value by $19 and increased accumulated undistributed (overdistributed) earnings by $19. During the year ended December 31, 2017, the Company decreased capital in excess of par value by $14, increased accumulated undistributed (overdistributed) earnings by $14.

        Certain of the Company's consolidated subsidiaries are subject to U.S. federal and state income taxes. For the years ended December 31, 2018, 2017 and 2016, the Company recorded a net tax expense of approximately $5, $7 and $9, respectively, for these subsidiaries.

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12.   DIVIDENDS AND DISTRIBUTIONS

        The following table summarizes the Company's dividends declared and payable during the years ended December 31, 2018, 2017 and 2016:

Date declared
  Record date   Payment date   Per share
amount
  Total
amount
 

October 31, 2018

  December 14, 2018   December 28, 2018   $ 0.39   $ 166  

August 1, 2018

  September 14, 2018   September 28, 2018   $ 0.39   $ 166  

May 2, 2018

  June 15, 2018   June 29, 2018   $ 0.38   $ 162  

February 13, 2018

  March 15, 2018   March 30, 2018   $ 0.38   $ 162  

Total declared and payable for the year ended December 31, 2018

          $ 1.54   $ 656  

November 2, 2017

  December 15, 2017   December 29, 2017   $ 0.38   $ 162  

August 2, 2017

  September 15, 2017   September 29, 2017   $ 0.38   $ 162  

May 3, 2017

  June 15, 2017   June 30, 2017   $ 0.38   $ 162  

February 22, 2017

  March 15, 2017   March 31, 2017   $ 0.38   $ 162  

Total declared and payable for the year ended December 31, 2017

          $ 1.52   $ 648  

November 2, 2016

  December 15, 2016   December 30, 2016   $ 0.38   $ 119  

August 3, 2016

  September 15, 2016   September 30, 2016   $ 0.38   $ 119  

May 4, 2016

  June 15, 2016   June 30, 2016   $ 0.38   $ 119  

February 26, 2016

  March 15, 2016   March 31, 2016   $ 0.38   $ 120  

Total declared and payable for the year ended December 31 2016

          $ 1.52   $ 477  

        The Company has a dividend reinvestment plan, whereby the Company may buy shares of its common stock in the open market or issue new shares in order to satisfy dividend reinvestment requests. When the Company issues new shares in connection with the dividend reinvestment plan, the issue price is equal to the closing price of its common stock on the dividend payment date. Dividend reinvestment plan activity for the years ended December 31, 2018, 2017 and 2016, was as follows:

 
  For the Years Ended
December 31,
 
 
  2018   2017   2016  

Shares issued

        0.4      

Average issue price per share

  $   $ 17.38   $  

Shares purchased by plan agent to satisfy dividends declared and payable during the period for stockholders

    1.8 (1)   1.5 (2)   1.3 (3)

Average purchase price per share

  $ 16.30   $ 16.28   $ 15.14  

(1)
Shares were purchased in April 2018, July 2018, October 2018 and January 2019.

(2)
Shares were purchased in July 2017, October 2017 and January 2018.

(3)
Shares were purchased in April 2016, July 2016, October 2016 and January 2017.

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13.   RELATED PARTY TRANSACTIONS

        In accordance with the investment advisory and management agreement, the Company bears all costs and expenses of the operation of the Company and reimburses its investment adviser or its affiliates for certain of such costs and expenses paid for by the investment adviser or its affiliates on behalf of the Company. For the years ended December 31, 2018, 2017 and 2016, the Company's investment adviser or its affiliates incurred and the Company reimbursed such expenses totaling $5, $5 and $5, respectively. The Company's investment adviser reimbursed the Company approximately $0.5 for certain rent and utilities incurred by the Company during the first quarter of 2018. In addition, during the second quarter of 2018, the Company's investment adviser reimbursed the Company approximately $2.2, $3.0, $3.2 and $2.9 of rent and utilities for the years ended 2017, 2016, 2015 and 2014, respectively, for an aggregate reimbursement to the Company of $11.8. Beginning April 1, 2018, the Company's investment adviser will bear such rent and utilities expenses.

        The Company is party to office leases pursuant to which it is leasing office facilities from third parties. Prior to March 31, 2018, for certain of these office leases, the Company had entered into separate subleases with Ares Management LLC, the sole member of Ares Capital Management, and IHAM, pursuant to which Ares Management LLC and IHAM subleased office space from the Company. In October 2018, the Company terminated all of its existing office space subleases with Ares Management LLC and IHAM. The Company then entered into a new sublease solely with Ares Management LLC, whereby Ares Management LLC subleased the full amount of certain of the Company's office leases. The other office leases not subleased to Ares Management LLC are office leases assumed as part of the American Capital Acquisition.

        The Company has also entered into agreements with Ares Management LLC and IHAM, pursuant to which Ares Management LLC and IHAM are entitled to use the Company's proprietary portfolio management software. For the years ended December 31, 2018, 2017 and 2016, amounts payable to the Company under these agreements totaled $0, $0 and $0, respectively.

        As part of the American Capital Acquisition, the Company assumed a long term incentive plan liability related to certain employees of a subsidiary of ACAM, which is now a subsidiary of IHAM. The liability is determined based on the fair value of certain investments acquired in the American Capital Acquisition. As of December 31, 2018, the remaining liability amount was estimated to be $1 and is included within accounts payable and other liabilities in the Company's consolidated balance sheet. This liability is paid on an annual basis based on exited investments in a given calendar year and the value received upon their exit. During the year ended December 31, 2018, the Company paid $27 related to the long term incentive plan liability.

        See Notes 3, 4, 6 and 16 for descriptions of other related party transactions.

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14.   FINANCIAL HIGHLIGHTS

        The following is a schedule of financial highlights as of and for the years ended December 31, 2018, 2017 and 2016:

 
  As of and For the Years Ended
December 31,
 
 
  2018   2017   2016  

Per Share Data:

                   

Net asset value, beginning of period(1)

  $ 16.65   $ 16.45   $ 16.46  

Issuances of common stock

        (0.01 )    

Repurchases of common stock

             

Deemed contribution from Ares Capital Management (See Note 16)

        0.13      

Issuances of convertible notes

        0.04      

Net investment income for period(2)

    1.63     1.20     1.57  

Net realized and unrealized gains (losses) for period(2)

    0.38     0.36     (0.06 )

Net increase in stockholders' equity

    2.01     1.72     1.51  

Total distributions to stockholders(3)

    (1.54 )   (1.52 )   (1.52 )

Net asset value at end of period(1)

  $ 17.12   $ 16.65   $ 16.45  

Per share market value at end of period

  $ 15.58   $ 15.72   $ 16.49  

Total return based on market value(4)

    8.91 %   4.55 %   26.39 %

Total return based on net asset value(5)

    12.10 %   10.53 %   9.15 %

Shares outstanding at end of period

    426     426     314  

Ratio/Supplemental Data:

                   

Net assets at end of period

  $ 7,300   $ 7,098   $ 5,165  

Ratio of operating expenses to average net assets(6)(7)

    8.63 %   9.45 %   9.59 %

Ratio of net investment income to average net assets(6)(8)

    9.60 %   7.65 %   9.58 %

Portfolio turnover rate(6)

    54 %   51 %   39 %

(1)
The net assets used equals the total stockholders' equity on the consolidated balance sheet.

(2)
Weighted average basic per share data.

(3)
Includes an additional dividend of $0.05 per share for the three months ended March 31, 2015.

(4)
For the year ended December 31, 2018, the total return based on market value equaled the decrease of the ending market value at December 31, 2018 of $15.58 per share from the ending market value at December 31, 2017 of $15.72 per share plus the declared and payable dividends of $1.54 per share for the year ended December 31, 2018, divided by the market value at December 31, 2017. For the year ended December 31, 2017, the total return based on market value equaled the decrease of the ending market value at December 31, 2017 of $15.72 per share from the ending market value at December 31, 2016 of $16.49 per share plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2017, divided by the market value at December 31, 2016. For the year ended December 31, 2016, the total return based on market value equaled the increase of the ending market value at December 31, 2016 of $16.49 per share from the ending market value at December 31, 2015 of $14.25 per share plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2016, divided by the market value at December 31, 2015. The Company's shares fluctuate in value. The Company's performance changes over time and currently may be different than that shown. Past performance is no guarantee of future results.

(5)
For the year ended December 31, 2018, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.54 per

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    share for the year ended December 31, 2018, divided by the beginning net asset value for the period. For the year ended December 31, 2017, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2017, divided by the beginning net asset value for the period. For the year ended December 31, 2016, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $1.52 per share for the year ended December 31, 2016, divided by the beginning net asset value for the period. These calculations are adjusted for shares issued in connection with the dividend reinvestment plan, the issuance of common stock in connection with any equity offerings and the equity components of any convertible notes issued during the period. The Company's performance changes over time and currently may be different than that shown. Past performance is no guarantee of future results.

(6)
The ratios reflect an annualized amount.

(7)
For the year ended December 31, 2018, the ratio of operating expenses to average net assets consisted of 2.49% of base management fees, 2.24% of income based fees and capital gains incentive fees, net of the Fee Waiver (2.79% of income based fees and capital gains incentive fees excluding the Fee Waiver), 3.33% of the cost of borrowing and 0.57% of other operating expenses. For the year ended December 31, 2017, the ratio of operating expenses to average net assets consisted of 2.57% of base management fees, 2.18% of income based fees and capital gains incentive fees, net of the Fee Waiver (2.32% of income based fees and capital gains incentive fees excluding the Fee Waiver, 3.37% of the cost of borrowing and 1.33% of other operating expenses. For the year ended December 31, 2016, the ratio of operating expenses to average net assets consisted of 2.64% of base management fees, 2.29% of income based fees and capital gains incentive fees, 3.58% of the cost of borrowing and 1.08% of other operating expenses.

(8)
The ratio of net investment income to average net assets excludes income taxes related to realized gains and losses.

15.   SELECTED QUARTERLY DATA (Unaudited)

 
  2018  
 
  Q4   Q3   Q2   Q1  

Total investment income

  $ 345   $ 342   $ 333   $ 317  

Net investment income before net realized and unrealized gains (losses) and income based fees and capital gains incentive fees, net of waiver of income based fees (See Note 3)

  $ 229   $ 225   $ 210   $ 192  

Income based fees and capital gains incentive fees, net of waiver of income based fees (See Note 3)

  $ 26   $ 40   $ 48   $ 48  

Net investment income before net realized and unrealized gains (losses)

  $ 203   $ 185   $ 162   $ 144  

Net realized and unrealized gains (losses)

  $ (50 ) $ 24   $ 92   $ 98  

Net increase in stockholders' equity resulting from operations

  $ 153   $ 209   $ 254   $ 242  

Basic and diluted earnings per common share

  $ 0.36   $ 0.49   $ 0.60   $ 0.57  

Net asset value per share as of the end of the quarter

  $ 17.12   $ 17.16   $ 17.05   $ 16.84  

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  2017  
 
  Q4   Q3   Q2   Q1  

Total investment income

  $ 307   $ 294   $ 284   $ 275  

Net investment income before net realized and unrealized gains (losses) and income based fees and capital gains incentive fees, net of waiver of income based fees (See Note 3)

  $ 185   $ 175   $ 154   $ 142  

Income based fees and capital gains incentive fees, net of waiver of income based fees (See Note 3)

  $ 45   $ 22   $ 30   $ 48  

Net investment income before net realized and unrealized gains

  $ 140   $ 153   $ 124   $ 94  

Net realized and unrealized gains (losses)

  $ 92   $ (14 ) $ 54   $ 24  

Net increase in stockholders' equity resulting from operations

  $ 232   $ 139   $ 178   $ 118  

Basic and diluted earnings per common share

  $ 0.54   $ 0.33   $ 0.42   $ 0.28  

Net asset value per share as of the end of the quarter

  $ 16.65   $ 16.49   $ 16.54   $ 16.50  

 

 
  2016  
 
  Q4   Q3   Q2   Q1  

Total investment income

  $ 261   $ 258   $ 245   $ 248  

Net investment income before net realized and unrealized gains and income based fees and capital gains incentive fees

  $ 157   $ 164   $ 144   $ 147  

Income based fees and capital gains incentive fees

  $ 19   $ 27   $ 39   $ 33  

Net investment income before net realized and unrealized gains

  $ 138   $ 137   $ 105   $ 114  

Net realized and unrealized gains (losses)

  $ (63 ) $ (28 ) $ 53   $ 18  

Net increase in stockholders' equity resulting from operations

  $ 75   $ 109   $ 158   $ 132  

Basic and diluted earnings per common share

  $ 0.24   $ 0.35   $ 0.50   $ 0.42  

Net asset value per share as of the end of the quarter

  $ 16.45   $ 16.59   $ 16.62   $ 16.50  

16.   AMERICAN CAPITAL ACQUISITION

        On May 23, 2016, the Company entered into a definitive agreement (the "Merger Agreement") to acquire American Capital. On the Acquisition Date, the Company completed the American Capital Acquisition pursuant to the terms and conditions of the Merger Agreement. Pursuant to the Merger Agreement, American Capital shareholders received total consideration of approximately $18.06 per share comprised of: (i) $14.41 per share from the Company consisting of approximately $6.48 per share of cash (including a make-up dividend in the amount of $0.07 per share) and 0.483 shares of the Company's common stock for each American Capital share at a value of $7.93 per American Capital share (based on the closing price per share of the Company's common stock on the Acquisition Date), (ii) $2.45 per share of cash from American Capital's sale of American Capital Mortgage Management, LLC, and (iii) approximately $1.20 per share of cash as transaction support provided by Ares Capital Management acting solely on its own behalf. As of the Acquisition Date, the transaction was valued at approximately $4.2 billion. The total cash and stock consideration paid by the Company was $3.3 billion. In connection with the stock consideration, the Company issued approximately 112 shares of its common stock to American Capital's then-existing stockholders (including holders of outstanding in-the-money American Capital stock options), thereby resulting in the Company's then-existing stockholders owning approximately 73.7% of the combined company and then-existing American Capital stockholders owning approximately 26.3% of the combined company. In addition, in connection with the American Capital Acquisition, Ares Capital Management agreed to waive certain income based fees as described in Note 3.

        The American Capital Acquisition was accounted for in accordance with the asset acquisition method of accounting as detailed in ASC 805-50, Business Combinations—Related Issues. The fair value of the merger consideration paid by the Company was allocated to the assets acquired and liabilities

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assumed based on their relative fair values as of the date of acquisition and did not give rise to goodwill. Since the fair value of the net assets acquired exceeded the fair value of the merger consideration paid by the Company, the Company recognized a deemed contribution from Ares Capital Management.

        The following table summarizes the allocation of the purchase price to the assets acquired and liabilities assumed as a result of the American Capital Acquisition:

Common stock issued by the Company

  $ 1,839  

Cash consideration paid by the Company

    1,502  

Deemed contribution from Ares Capital Management

    54  

Total purchase price

  $ 3,395  

Assets acquired:

       

Investments(1)

  $ 2,543  

Cash and cash equivalents

    961  

Other assets(2)

    117  

Total assets acquired

    3,621  

Liabilities assumed(3)

    (226 )

Net assets acquired

  $ 3,395  

(1)
Investments acquired were recorded at fair value, which is also the Company's initial cost basis.

(2)
Other assets acquired in the American Capital Acquisition consisted of the following:

Receivable for open trades

  $ 45  

Escrows receivable

    41  

Interest receivable

    9  

Other assets

    22  

Total

  $ 117  
(3)
Liabilities assumed in the American Capital Acquisition consisted of the following:

Severance and other payroll related

  $ 95  

Lease abandonments

    55  

Long term incentive plan (see Note 13)

    31  

Escrows payable

    25  

Other liabilities

    20  

Total

  $ 226  

        During the years ended December 31, 2018 and 2017, the Company incurred $3 and $45, respectively, in professional fees and other costs related to the American Capital Acquisition. For the year ended December 31, 2017, these costs included $4 of expenses related to a long term incentive plan liability assumed in the American Capital Acquisition, including $18 in one-time investment banking fees incurred in January 2017 upon the closing of the American Capital Acquisition.

17.   LITIGATION

        The Company is party to certain lawsuits in the normal course of business. In addition, American Capital and Allied Capital were involved in various legal proceedings that the Company assumed in

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connection with the American Capital Acquisition and the Allied Acquisition, respectively. Furthermore, third parties may try to seek to impose liability on the Company in connection with the Company's activities or the activities of its portfolio companies. While the outcome of any such legal proceedings cannot at this time be predicted with certainty, the Company does not expect that these legal proceedings will materially affect its business, financial condition or results of operations.

        On May 20, 2013, the Company was named as one of several defendants in an action filed in the United States District Court for the Eastern District of Pennsylvania by the bankruptcy trustee of DSI Renal Holdings LLC ("DSI Renal") and two affiliate companies. On March 17, 2014, the motion by the Company and the other defendants to transfer the case to the United States District Court for the District of Delaware (the "Delaware Court") was granted. On May 6, 2014, the Delaware Court referred the matter to the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). The complaint alleges, among other things, that each of the named defendants participated in a purported fraudulent transfer involving the restructuring of a subsidiary of DSI Renal. Among other things, the complaint seeks, jointly and severally from all defendants, (1) damages of approximately $425, of which the complaint states the Company's individual share is approximately $117, (2) interest thereon according to law, and (3) punitive damages. The defendants filed a motion to dismiss all claims on August 5, 2013. On July 20, 2017, the Bankruptcy Court issued an order granting the motion to dismiss certain claims and denying the motion to dismiss certain other claims, including the purported fraudulent transfer claims. The defendants answered the complaint on August 31, 2017. Under the operative scheduling order, discovery will continue until early March 29, 2019 with dispositive motions due on April 30, 2019. No trial date has been set. The Company is currently unable to assess with any certainty whether it may have any exposure in this matter. However, the Company believes the plaintiff's claims are without merit and intends to vigorously defend itself in this matter.

        On August 3, 2017, American Capital and one of its former portfolio companies were awarded a judgment plus prejudgment interest by the United States District Court for the District of Maryland (the "District Court") following a bench trial in a case first filed by one of American Capital's insurance companies concerning coverage for bodily injury claims against American Capital and/or its former portfolio company. The District Court found that the carrier breached its duty to defend American Capital and its former portfolio company against more than 1,000 bodily injury claims and awarded American Capital damages plus prejudgment interest. American Capital's carrier filed a notice of appeal to the United States Court of Appeals for the Fourth Circuit (the "Court of Appeals"); thereafter, American Capital and its former portfolio company filed a notice of cross appeal, including cross claims. The appeal was fully briefed and oral argument on the appeal took place on September 28, 2018. On February 6, 2019, the Court of Appeals entered a judgment affirming the District Court judgment in all respects in the amount of approximately $88, of which the American Capital share would be approximately $53. American Capital also intends to petition the District Court for recovery of its reasonable legal fees and costs in connection with the litigation. The carriers have not advised as to whether they intend to engage in post-judgment proceedings to attempt to modify the judgment, and accordingly, American Capital's recovery in the litigation, if any, is not yet known. The Company has secured insurance to protect at least $47 of the judgment in favor of American Capital.

18.   SUBSEQUENT EVENTS

        The Company's management has evaluated subsequent events through the date of issuance of the consolidated financial statements included herein. There have been no subsequent events that occurred during such period that would require disclosure in this Form 10-K or would be required to be recognized in the consolidated financial statements as of and for the year ended December 31, 2018, except as discussed below.

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        In January 2019, the Company repaid in full the $300 in aggregate principal amount of the 2019 Convertible Notes upon their maturity. The 2019 Convertible Notes bore interest at a rate of 4.375% per year, payable semi-annually.

        In February 2019, the Company's board of directors authorized an amendment to its stock repurchase program to (a) increase the total authorization under the program from $300 to $500 and (b) extend the expiration date of the program from February 28, 2019 to February 28, 2020. Under the stock repurchase program, the Company may repurchase up to $500 in the aggregate of its outstanding common stock in the open market at a price per share that meets certain thresholds below its net asset value per share, in accordance with the guidelines specified in Rule 10b-18 of the Exchange Act. The timing, manner, price and amount of any share repurchases will be determined by the Company, in its discretion, based upon the evaluation of economic and market conditions, stock price, applicable legal and regulatory requirements and other factors.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(in millions, except per share data)

 
  As of  
 
  March 31,
2019
  December 31,
2018
 
 
  (unaudited)
   
 

ASSETS

             

Investments at fair value

             

Non-controlled/non-affiliate company investments

  $ 10,882   $ 10,478  

Non-controlled affiliate company investments

    360     292  

Controlled affiliate company investments

    1,822     1,647  

Total investments at fair value (amortized cost of $13,440 and $12,754, respectively)

    13,064     12,417  

Cash and cash equivalents

    572     296  

Interest receivable

    114     91  

Receivable for open trades

    28     12  

Operating lease right-of-use asset

    105      

Other assets

    79     79  

Total assets

  $ 13,962   $ 12,895  

LIABILITIES

             

Debt

  $ 6,197   $ 5,214  

Base management fees payable

    49     45  

Income based fees payable

    38     36  

Capital gains incentive fees payable

    64     112  

Interest and facility fees payable

    25     64  

Payable for open trades

    35     25  

Operating lease liabilities

    137      

Accounts payable and other liabilities

    78     99  

Total liabilities

    6,623     5,595  

Commitments and contingencies (Note 7)

             

STOCKHOLDERS' EQUITY

             

Common stock, par value $0.001 per share, 600 common shares authorized; 426 and 426 common shares issued and outstanding, respectively

         

Capital in excess of par value

    7,177     7,173  

Accumulated undistributed earnings

    162     127  

Total stockholders' equity

    7,339     7,300  

Total liabilities and stockholders' equity

  $ 13,962   $ 12,895  

NET ASSETS PER SHARE

  $ 17.21   $ 17.12  

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS

(in millions, except per share data)

(unaudited)

 
  For the
Three Months
Ended
March 31,
 
 
  2019   2018  

INVESTMENT INCOME:

             

From non-controlled/non-affiliate company investments:

             

Interest income from investments (excluding payment-in-kind ("PIK") interest income)

  $ 233   $ 201  

PIK interest income from investments

    12     12  

Capital structuring service fees

    39     26  

Dividend income

    15     9  

Other income

    8     6  

Total investment income from non-controlled/non-affiliate company investments

    307     254  

From non-controlled affiliate company investments:

             

Interest income from investments (excluding PIK interest income)

    5     4  

PIK interest income from investments

    1     1  

Capital structuring service fees

    2      

Dividend income

    1      

Total investment income from non-controlled affiliate company investments

    9     5  

From controlled affiliate company investments:

             

Interest income from investments (excluding PIK interest income)

    33     30  

PIK interest income from investments

    5     6  

Capital structuring service fees

    4     3  

Dividend income

    15     13  

Other income

        6  

Total investment income from controlled affiliate company investments

    57     58  

Total investment income

    373     317  

EXPENSES:

             

Interest and credit facility fees

    67     60  

Base management fees

    49     46  

Income based fees

    48     38  

Capital gains incentive fees

    2     20  

Administrative fees

    4     3  

Other general and administrative

    8     11  

Total expenses

    178     178  

Waiver of income based fees

    (10 )   (10 )

Total expenses, net of waiver of income based fees

    168     168  

NET INVESTMENT INCOME BEFORE INCOME TAXES

    205     149  

Income tax expense, including excise tax

    4     5  

NET INVESTMENT INCOME

    201     144  

REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS, FOREIGN CURRENCY AND OTHER TRANSACTIONS:

             

Net realized gains (losses):

             

Non-controlled/non-affiliate company investments

    7      

Controlled affiliate company investments

         

Foreign currency and other transactions

    49     (12 )

Net realized gains (losses)

    56     (12 )

Net unrealized gains (losses):

             

Non-controlled/non-affiliate company investments

    (33 )   16  

Non-controlled affiliate company investments

    (7 )   2  

Controlled affiliate company investments

    1     78  

Foreign currency and other transactions

    (4 )   14  

Net unrealized gains (losses)

    (43 )   110  

Net realized and unrealized gains on investments, foreign currency and other transactions

    13     98  

NET INCREASE IN STOCKHOLDERS' EQUITY RESULTING FROM OPERATIONS

  $ 214   $ 242  

BASIC AND DILUTED EARNINGS PER COMMON SHARE (see Note 10)

  $ 0.50   $ 0.57  

WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING (see Note 10)

    426     426  

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2019
(dollar amounts in millions)
(unaudited)

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Healthcare Services

               

 

                   

Absolute Dental Management LLC and ADM Equity, LLC

  Dental services provider   First lien senior secured loan ($0.8 par due 1/2022)   11.00% (Base Rate + 5.50%/Q)    

1/15/2019

  $ 0.8   $ 0.8 (2)(14)      

      First lien senior secured loan ($24.3 par due 1/2022)        

1/5/2016

    24.2     7.1 (2)(13)      

      Class A preferred units (4,000,000 units)        

1/5/2016

    4.0     (2)      

      Class A common units (4,000,000 units)        

1/5/2016

        (2)      

                      29.0     7.9        

                                     

Acessa Health Inc. (fka HALT Medical, Inc.)

  Medical supply provider   Common stock (569,823 shares)        

6/22/2017

    0.1            

                                     

ADCS Billings Intermediate Holdings, LLC(18)

  Dermatology practice   First lien senior secured revolving loan ($1.3 par due 5/2022)   10.25% (Base Rate + 4.75%/Q)    

5/18/2016

    1.3     1.2 (2)(14)      

                                     

ADG, LLC and RC IV GEDC Investor LLC(18)

  Dental services provider   First lien senior secured revolving loan ($3.1 par due 9/2022)   7.25% (Libor + 4.75%/M)    

9/28/2016

    3.1     3.0 (2)(14)      

      First lien senior secured revolving loan ($10.6 par due 9/2022)   9.25% (Base Rate + 3.75%/Q)    

9/28/2016

    10.6     10.1 (2)(14)      

      Second lien senior secured loan ($87.5 par due 3/2024)   11.88% (Libor + 9.00%/S)    

9/28/2016

    87.5     75.3 (2)(14)      

      Membership units (3,000,000 units)        

9/28/2016

    3.0     0.8 (2)      

                      104.2     89.2        

                                     

Air Medical Group Holdings, Inc. and Air Medical Buyer Corp.

  Emergency air medical services provider   Senior subordinated loan ($182.7 par due 3/2026)   10.36% (Libor + 7.88%/M)    

3/14/2018

    182.7     179.9 (2)(14)      

      Warrant to purchase up to 115,733 units of common stock (expires 3/2028)        

3/14/2018

    0.9     1.4 (2)      

                      183.6     181.3        

                                     

Alcami Corporation and ACM Holdings I, LLC(18)

  Outsourced drug development services provider   First lien senior secured revolving loan ($1.7 par due 7/2023)   6.25% (Libor + 3.75%/M)    

7/12/2018

    1.7     1.7 (2)(14)      

      First lien senior secured revolving loan ($1.7 par due 7/2023)   6.23% (Libor + 3.75%/M)    

7/12/2018

    1.7     1.7 (2)(14)      

      First lien senior secured loan ($30.0 par due 7/2025)   6.73% (Libor + 4.25%/M)    

7/12/2018

    29.9     29.1 (3)(14)      

      Second lien senior secured loan ($77.5 par due 7/2026)   10.48% (Libor + 8.00%/M)    

7/12/2018

    76.8     73.7 (2)(14)      

      Common units (3,269,900 units)        

7/12/2018

    32.7     21.1 (2)      

                      142.8     127.3        

                                     

Alteon Health, LLC

  Provider of physician management services   First lien senior secured loan ($3.0 par due 9/2022)   9.00% (Libor + 6.50%/M)    

5/15/2017

    3.0     2.5 (2)(14)      

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Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

American Academy Holdings, LLC(18)

  Provider of education, training, certification, networking, and consulting services to medical coders and other healthcare professionals   First lien senior secured revolving loan ($0.9 par due 12/2022)   10.75% (Base Rate + 5.25%/M)    

12/15/2017

    0.9     0.9 (2)(14)      

      First lien senior secured loan ($84.1 par due 12/2022)   10.75% (Base Rate + 5.25%/M)    

12/15/2017

    84.1     85.8 (2)(14)      

      First lien senior secured loan ($90.5 par due 12/2022)   10.75% (Base Rate + 5.25%/M)    

12/15/2017

    90.5     92.3 (3)(14)      

      Senior subordinated loan ($81.1 par due 6/2023)   18.50% (Libor + 7.00% Cash, 6.00% PIK/Q)    

12/15/2017

    81.1     85.2 (2)(14)      

                      256.6     264.2        

                                     

athenahealth, Inc., VVC Holding Corp., Virence Intermediate Holding Corp., and Virence Holdings LLC(18)

  Revenue cycle management provider to the physician practices and acute care hospitals   First lien senior secured loan ($32.3 par due 2/2026)   7.20% (Libor + 4.50%/Q)    

2/11/2019

    31.6     31.6 (2)(14)      

      Second lien senior secured loan ($210.3 par due 2/2027)   11.20% (Libor + 8.50%/Q)    

2/11/2019

    210.3     206.1 (2)(14)      

      Senior preferred stock (121,810 shares)   13.62% PIK (Libor + 11.13%)    

2/11/2019

    121.8     121.8 (2)(14)      

      Class A interests (0.39% interest)        

2/11/2019

    9.0     9.0 (2)      

                      372.7     368.5        

                                     

Bambino CI Inc.(18)

  Manufacturer and provider of single-use obstetrics products   First lien senior secured revolving loan ($0.1 par due 10/2022)   7.99% (Libor + 5.50%/M)    

10/17/2017

    0.1     0.1 (2)(14)      

      First lien senior secured revolving loan ($1.1 par due 10/2022)   7.98% (Libor + 5.50%/Q)    

10/17/2017

    1.1     1.1 (2)(14)      

      First lien senior secured revolving loan ($1.1 par due 10/2022)   10.00% (Base Rate + 4.50%/Q)    

10/17/2017

    1.1     1.1 (2)(14)      

      First lien senior secured loan ($30.8 par due 10/2023)   7.99% (Libor + 5.50%/M)    

10/17/2017

    30.8     30.8 (3)(14)      

                      33.1     33.1        

                                     

Care Hospice, Inc(18)

  Provider of hospice services   First lien senior secured revolving loan ($0.6 par due 4/2022)   7.38% (Libor + 4.75%/Q)    

2/8/2018

    0.6     0.6 (2)(14)(17)      

      First lien senior secured revolving loan ($0.3 par due 4/2022)   7.23% (Libor + 4.75%/M)    

2/8/2018

    0.3     0.3 (2)(14)(17)      

      First lien senior secured revolving loan ($0.3 par due 4/2022)   7.23% (Libor + 4.75%/M)    

2/8/2018

    0.3     0.3 (2)(14)(17)      

                      1.2     1.2        

                                     

CCS-CMGC Holdings, Inc.(18)

  Correctional facility healthcare operator   First lien senior secured revolving loan ($1.9 par due 10/2023)   8.00% (Libor + 5.50%/M)    

10/1/2018

    1.9     1.8 (2)(14)(17)      

      First lien senior secured loan ($34.9 par due 10/2025)   8.00% (Libor + 5.50%/M)    

9/25/2018

    34.6     34.6 (3)(14)      

                      36.5     36.4        

                                     

Center for Autism and Related Disorders, LLC(18)

  Autism treatment and services provider specializing in applied behavior analysis therapy   First lien senior secured revolving loan      

11/21/2018

        (16)      

F-145


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Comprehensive EyeCare Partners, LLC(18)

  Vision care practice management company   First lien senior secured revolving loan ($0.1 par due 2/2024)   7.31% (Libor + 4.50%/Q)    

2/14/2018

    0.1     0.1 (2)(14)      

      First lien senior secured revolving loan ($0.3 par due 2/2024)   7.31% (Libor + 4.50%/Q)    

2/14/2018

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($2.4 par due 2/2024)   7.12% (Libor + 4.50%/Q)    

2/14/2018

    2.4     2.4 (2)(14)      

      First lien senior secured loan ($5.4 par due 2/2024)   7.12% (Libor + 4.50%/Q)    

2/14/2018

    5.4     5.4 (2)(14)      

                      8.2     8.2        

                                     

D4C Dental Brands HoldCo, Inc. and Bambino Group Holdings, LLC(18)

  Dental services provider   Class A preferred units (1,000,000 units)   8.00% PIK    

12/21/2016

    1.0     1.0 (2)      

                                     

Datix Bidco Limited(8)

  Global healthcare software company that provides software solutions for patient safety and risk management   First lien senior secured loan ($2.9 par due 4/2025)   7.28% (Libor + 4.50%/S)    

4/27/2018

    2.9     2.9 (2)(14)      

      First lien senior secured loan ($2.9 par due 4/2025)   7.28% (Libor + 4.50%/S)    

4/27/2018

    2.9     2.9 (2)(14)      

                      5.8     5.8        

                                     

DCA Investment Holding, LLC(18)

  Multi-branded dental practice management   First lien senior secured revolving loan ($0.1 par due 7/2021)   9.75% (Base Rate + 4.25%/Q)    

7/2/2015

    0.1     0.1 (2)(14)(17)      

      First lien senior secured loan ($18.5 par due 7/2021)   7.85% (Libor + 5.25%/Q)    

7/2/2015

    18.4     18.5 (4)(14)      

                      18.5     18.6        

                                     

Emerus Holdings, Inc.(18)

  Freestanding 24-hour emergency care micro-hospitals operator   First lien senior secured loan ($16.5 par due 2/2022)   14.00%    

2/21/2019

    16.5     16.5 (2)      

                                     

GHX Ultimate Parent Corporation, Commerce Parent, Inc. and Commerce Topco, LLC

  On-demand supply chain automation solutions provider to the healthcare industry   Second lien senior secured loan ($34.5 par due 6/2025)   10.60% (Libor + 8.00%/Q)    

6/30/2017

    34.1     34.5 (2)(14)      

      Series A preferred stock (110,425 shares)   13.55% PIK (Libor + 10.95%)    

6/30/2017

    138.1     138.1 (2)(14)      

      Class A units (14,013,303 units)        

6/30/2017

    14.0     16.8 (2)      

                      186.2     189.4        

                                     

Greenphire, Inc. and RMCF III CIV XXIX, L.P

  Software provider for clinical trial management   Limited partnership interest (99.90% interest)        

12/19/2014

    1.0     3.3 (2)      

                                     

Hygiena Borrower LLC(18)

  Adenosine triphosphate testing technology provider   First lien senior secured revolving loan      

8/26/2016

        (16)      

      First lien senior secured loan ($9.5 par due 8/2022)   6.60% (Libor + 4.00%/Q)    

6/29/2018

    9.5     9.5 (2)(14)      

      Second lien senior secured loan ($11.1 par due 8/2023)   10.35% (Libor + 7.75%/Q)    

6/29/2018

    11.1     11.1 (2)(14)      

      Second lien senior secured loan ($0.6 par due 8/2023)   10.35% (Libor + 7.75%/Q)    

6/29/2018

    0.6     0.6 (2)(14)      

      Second lien senior secured loan ($2.5 par due 8/2023)   10.35% (Libor + 7.75%/Q)    

8/26/2016

    2.5     2.5 (2)(14)      

      Second lien senior secured loan ($10.7 par due 8/2023)   10.35% (Libor + 7.75%/Q)    

2/27/2017

    10.7     10.7 (2)(14)      

                      34.4     34.4        

F-146


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

JDC Healthcare Management, LLC(18)

  Dental services provider   First lien senior secured revolving loan ($0.8 par due 4/2022)   10.24% (Libor + 7.75%/M)    

4/10/2017

    0.8     0.8 (2)(14)      

      First lien senior secured revolving loan ($0.8 par due 4/2022)   10.25% (Libor + 7.75%/M)    

4/10/2017

    0.8     0.8 (2)(14)      

      First lien senior secured loan ($4.2 par due 4/2023)   10.24% (Libor + 6.75% Cash, 1.00% PIK/Q)    

4/10/2017

    4.2     3.9 (2)(14)      

      First lien senior secured loan ($9.9 par due 4/2023)   10.25% (Libor + 6.75% Cash, 1.00% PIK/Q)    

4/10/2017

    9.9     9.2 (2)(14)      

      First lien senior secured loan ($19.7 par due 4/2023)   10.25% (Libor + 6.75% Cash, 1.00% PIK/Q)    

4/10/2017

    19.7     18.4 (4)(14)      

                      35.4     33.1        

                                     

KBHS Acquisition, LLC (d/b/a Alita Care, LLC)(18)

  Provider of behavioral health services   First lien senior secured revolving loan ($0.9 par due 3/2022)   7.48% (Libor + 5.00%/M)    

3/17/2017

    0.9     0.9 (2)(14)      

      First lien senior secured revolving loan ($0.9 par due 3/2022)   7.49% (Libor + 5.00%/M)    

3/17/2017

    0.9     0.9 (2)(14)      

      First lien senior secured revolving loan ($0.2 par due 3/2022)   7.48% (Libor + 5.00%/M)    

3/17/2017

    0.2     0.2 (2)(14)      

      First lien senior secured revolving loan ($0.6 par due 3/2022)   7.49% (Libor + 5.00%/M)    

3/17/2017

    0.6     0.5 (2)(14)      

      First lien senior secured revolving loan ($2.1 par due 3/2022)   7.50% (Libor + 5.00%/M)    

3/17/2017

    2.1     2.0 (2)(14)      

      First lien senior secured revolving loan ($0.2 par due 3/2022)   9.50% (Base Rate + 4.00%/Q)    

3/17/2017

    0.2     0.2 (2)(14)      

                      4.9     4.7        

                                     

Key Surgical LLC(18)

  Provider of sterile processing, operating room and instrument care supplies for hospitals   First lien senior secured loan ($16.6 par due 6/2023)   5.75% (EURIBOR + 4.75%/Q)    

6/1/2017

    16.6     16.6 (2)(14)      

                                     

MB2 Dental Solutions, LLC(18)

  Dental services provider   First lien senior secured revolving loan ($1.9 par due 9/2023)   9.25% (Base Rate + 3.75%/Q)    

9/29/2017

    1.9     1.9 (2)(14)      

      First lien senior secured loan ($7.0 par due 9/2023)   7.35% (Libor + 4.75%/Q)    

9/29/2017

    7.0     7.0 (2)(14)      

                      8.9     8.9        

                                     

MCH Holdings, Inc. and MC Acquisition Holdings I, LLC

  Healthcare professional provider   First lien senior secured loan ($19.5 par due 1/2020)   7.98% (Libor + 5.50%/M)    

7/26/2017

    19.5     19.5 (2)(14)      

      First lien senior secured loan ($19.4 par due 1/2020)   8.00% (Libor + 5.50%/M)    

7/26/2017

    19.4     19.4 (2)(14)      

      First lien senior secured loan ($39.6 par due 1/2020)   7.98% (Libor + 5.50%/M)    

7/26/2017

    39.6     39.6 (3)(14)      

      First lien senior secured loan ($39.4 par due 1/2020)   8.00% (Libor + 5.50%/M)    

7/26/2017

    39.4     39.4 (3)(14)      

      First lien senior secured loan ($15.2 par due 1/2020)   7.98% (Libor + 5.50%/M)    

7/26/2017

    15.2     15.2 (4)(14)      

      First lien senior secured loan ($15.1 par due 1/2020)   8.00% (Libor + 5.50%/M)    

7/26/2017

    15.1     15.1 (4)(14)      

      Class A units (1,438,643 shares)        

1/17/2014

    1.5     1.1 (2)      

                      149.7     149.3        

F-147


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

MW Dental Holding Corp.(18)

  Dental services provider   First lien senior secured revolving loan ($6.0 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

4/12/2011

    6.0     6.0 (2)(14)      

      First lien senior secured loan ($18.7 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

3/19/2018

    18.7     18.7 (2)(14)      

      First lien senior secured loan ($104.3 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

4/12/2011

    104.3     104.3 (3)(14)      

      First lien senior secured loan ($19.1 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

4/12/2011

    19.1     19.1 (4)(14)      

                      148.1     148.1        

                                     

My Health Direct, Inc.

  Healthcare scheduling exchange software solution provider   Warrant to purchase up to 4,548 shares of Series D preferred stock (expires 9/2024)        

9/18/2014

        (2)      

                                     

New Trident Holdcorp, Inc. and Trident Holding Company, LLC

  Outsourced mobile diagnostic healthcare service provider   Second lien senior secured loan ($25.0 par due 7/2022)        

8/1/2013

    19.4     (2)(13)      

      Second lien senior secured loan ($78.4 par due 7/2020)        

8/1/2013

    67.8     (2)(13)      

      Senior subordinated loan ($9.1 par due 7/2020)        

11/29/2017

    8.8     (2)(13)      

                      96.0            

                                     

NMC Skincare Intermediate Holdings II, LLC(18)

  Developer, manufacturer and marketer of skincare products   First lien senior secured revolving loan ($1.6 par due 10/2024)   7.25% (Libor + 4.75%/M)    

10/31/2018

    1.6     1.6 (2)(14)      

      First lien senior secured loan ($1.7 par due 10/2024)   7.25% (Libor + 4.75%/M)    

10/31/2018

    1.7     1.7 (2)(14)      

      First lien senior secured loan ($24.8 par due 10/2024)   7.25% (Libor + 4.75%/M)    

10/31/2018

    24.8     24.6 (3)(14)      

                      28.1     27.9        

                                     

NMN Holdings III Corp. and NMN Holdings LP(18)

  Provider of complex rehab technology solutions for patients with mobility loss   Partnership units (30,000 units)        

11/13/2018

    3.0     3.1 (2)      

                                     

NMSC Holdings, Inc. and ASP NAPA Holdings, LLC

  Anesthesia management services provider   Second lien senior secured loan ($72.8 par due 10/2023)   12.50% (Libor + 10.00%/M)    

4/19/2016

    72.8     72.8 (2)(14)      

      Class A units (25,790 units)        

4/19/2016

    2.6     1.3 (2)      

                      75.4     74.1        

                                     

Nodality, Inc.

  Biotechnology company   First lien senior secured loan ($2.3 par due 8/2016)        

11/12/2015

    1.5     (2)(13)      

      First lien senior secured loan ($0.8 par due 8/2016)        

11/12/2015

    0.6     (2)(13)      

      First lien senior secured loan ($3.9 par due 8/2016)        

4/25/2014

    2.6     (2)(13)      

      First lien senior secured loan ($11.0 par due 8/2016)        

4/25/2014

    7.1     (2)(13)      

      Warrant to purchase up to 3,736,255 shares of common stock (expires 3/2026)        

5/1/2016

        (2)      

                      11.8            

                                     

nThrive, Inc. (fka Precyse Acquisition Corp.)

  Provider of healthcare information management technology and services   Second lien senior secured loan ($10.0 par due 4/2023)   12.25% (Libor + 9.75%/M)    

4/20/2016

    9.8     9.8 (2)(14)      

F-148


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

NueHealth Performance, LLC(18)

  Developer, builder and manager of specialty surgical hospitals and ambulatory surgery centers   First lien senior secured loan ($1.5 par due 9/2023)   9.00% (Libor + 6.50%/M)    

9/27/2018

    1.5     1.5 (2)(14)      

      First lien senior secured loan ($10.0 par due 9/2023)   9.00% (Libor + 6.50%/M)    

9/27/2018

    10.0     9.9 (2)(14)      

                      11.5     11.4        

                                     

OmniSYS Acquisition Corporation, OmniSYS, LLC, and OSYS Holdings, LLC

  Provider of technology-enabled solutions to pharmacies   Limited liability company membership interest (1.57%)        

11/21/2013

    1.0     0.8 (2)      

                                     

Pathway Vet Alliance LLC and Pathway Vet Alliance Holding LLC(18)

  Operator of freestanding veterinary hospitals   First lien senior secured revolving loan      

12/21/2018

        (16)      

      First lien senior secured loan ($2.1 par due 12/2024)   7.00% (Libor + 4.50%/M)    

12/21/2018

    2.1     2.1 (2)(14)      

      First lien senior secured loan ($69.5 par due 12/2024)   7.00% (Libor + 4.50%/M)    

12/21/2018

    68.9     68.8 (2)(14)      

      Second lien senior secured loan ($163.9 par due 12/2025)   11.00% (Libor + 8.50%/M)    

12/21/2018

    163.9     162.3 (2)(14)      

      Preferred units (1,507,384 units)        

12/21/2018

    4.9     4.4        

                      239.8     237.6        

                                     

Patterson Medical Supply, Inc.

  Distributor of rehabilitation supplies and equipment   Second lien senior secured loan ($78.0 par due 8/2023)   11.24% (Libor + 8.50%/Q)    

9/2/2015

    76.8     67.9 (2)(14)      

                                     

Phylogeny, LLC and Conversant Biologics, LLC (fka WSHP FC Acquisition LLC)(18)

  Provider of biospecimen products for pharma research   First lien senior secured loan ($6.0 par due 3/2024)   9.10% (Libor + 6.50%/Q)    

3/30/2018

    6.0     6.0 (2)(14)      

      First lien senior secured loan ($4.7 par due 3/2024)   9.10% (Libor + 6.50%/M)    

2/11/2019

    4.7     4.7 (2)(14)      

      First lien senior secured loan ($28.4 par due 3/2024)   9.10% (Libor + 6.50%/Q)    

3/30/2018

    28.4     28.4 (3)(14)      

                      39.1     39.1        

                                     

PhyMED Management LLC

  Provider of anesthesia services   Second lien senior secured loan ($47.2 par due 5/2021)   11.38% (Libor + 8.75%/Q)    

12/18/2015

    47.0     47.2 (2)(14)      

                                     

Practice Insight, LLC(18)

  Revenue cycle management provider to the emergency healthcare industry   First lien senior secured loan ($12.4 par due 8/2022)   7.50% (Libor + 5.00%/M)    

8/23/2017

    12.4     12.4 (4)(14)      

                                     

Premise Health Holding Corp. and OMERS Bluejay Investment Holdings LP(18)

  Provider of employer-sponsored onsite health and wellness clinics and pharmacies   First lien senior secured revolving loan ($3.0 par due 7/2023)   6.09% (Libor + 3.50%/Q)    

7/10/2018

    3.0     3.0 (2)(14)      

      First lien senior secured loan ($0.8 par due 7/2025)   6.35% (Libor + 3.75%/Q)    

7/10/2018

    0.8     0.8 (2)(14)      

      First lien senior secured loan ($10.9 par due 7/2025)   6.35% (Libor + 3.75%/Q)    

7/10/2018

    10.9     10.8 (4)(14)      

      Second lien senior secured loan ($67.1 par due 7/2026)   10.10% (Libor + 7.50%/Q)    

7/10/2018

    66.5     66.4 (2)(14)      

      Class A units (9,775 units)        

7/10/2018

    9.8     10.4 (2)      

                      91.0     91.4        

                                     

ProVation Medical, Inc.

  Provider of documentation and coding software for GI physicians   First lien senior secured loan ($13.0 par due 3/2024)   9.55% (Libor + 6.75%/Q)    

3/9/2018

    12.8     13.0 (2)(14)      

F-149


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

RecoveryDirect Acquisition, L.L.C.(18)

  Outpatient physical therapy provider   First lien senior secured loan ($6.9 par due 1/2024)   6.50% (Libor + 4.00%/M)    

1/3/2018

    6.9     6.9 (2)(14)      

      First lien senior secured loan ($30.7 par due 1/2024)   6.50% (Libor + 4.25%/M)    

1/3/2018

    30.7     30.7 (4)(14)      

                      37.6     37.6        

                                     

Respicardia, Inc.

  Developer of implantable therapies to improve cardiovascular health   Warrant to purchase up to 99,094 shares of Series C preferred stock (expires 6/2022)        

6/28/2012

        (2)      

                                     

Retriever Medical/Dental Payments LLC(18)

  Provider of payment processing services and software to healthcare providers   First lien senior secured loan ($2.0 par due 2/2023)   7.30% (Libor + 4.50%/Q)    

3/14/2019

    2.0     2.0 (2)(14)      

                                     

RTI Surgical, Inc.

  Manufacturer of biologic, metal and synthetic implants/devices   Second lien senior secured loan ($90.8 par due 12/2023)   11.24% (Libor + 8.75%/M)    

3/8/2019

    90.8     89.9 (2)(14)      

                                     

Salter Labs(18)

  Developer, manufacturer and supplier of consumable products for medical device customers   First lien senior secured revolving loan ($0.6 par due 3/2020)   7.01% (Libor + 4.25%/Q)    

2/8/2018

    0.6     0.6 (2)(14)(17)      

                                     

SCSG EA Acquisition Company, Inc.(18)

  Provider of outsourced clinical services to hospitals and health systems   First lien senior secured revolving loan      

9/1/2017

        (16)      

                                     

SiroMed Physician Services, Inc. and SiroMed Equity Holdings, LLC(18)

  Outsourced anesthesia provider   First lien senior secured revolving loan ($2.9 par due 3/2024)   9.25% (Base Rate + 3.75%/Q)    

3/26/2018

    2.9     2.7 (2)(14)      

      First lien senior secured loan ($17.4 par due 3/2024)   7.35% (Libor + 4.75%/Q)    

3/26/2018

    17.4     16.5 (3)(14)      

      Common units (171,784 units)        

3/26/2018

    4.6     2.7 (2)      

                      24.9     21.9        

                                     

SM Wellness Holdings, Inc. and SM Holdco, Inc.(18)

  Breast cancer screening provider   First lien senior secured loan ($0.7 par due 8/2024)   8.00% (Libor + 5.50%/M)    

8/1/2018

    0.7     0.7 (2)(14)      

      First lien senior secured loan ($7.1 par due 8/2024)   8.00% (Libor + 5.50%/M)    

8/1/2018

    7.1     7.1 (2)(14)      

      Series A preferred stock (44,975 shares)   13.05% PIK (Libor + 10.45%)    

8/1/2018

    48.9     48.9 (2)(14)      

      Series A units (7,475 units)        

8/1/2018

    7.5     0.1 (2)      

      Series B units (747,500 units)        

8/1/2018

        8.4 (2)      

                      64.2     65.2        

                                     

Synergy HomeCare Franchising, LLC and NP/Synergy Holdings, LLC(18)

  Franchisor of private-pay home care for the elderly   First lien senior secured loan ($16.0 par due 4/2024)   8.35% (Libor + 5.75%/Q)    

4/2/2018

    16.0     16.0 (2)(14)      

      Common units (550 units)        

4/2/2018

    0.6     0.7        

                      16.6     16.7        

                                     

Teligent, Inc.(18)

  Pharmaceutical company that develops, manufactures and markets injectable pharmaceutical products   Second lien senior secured loan ($18.8 par due 6/2024)   11.35% (Libor + 7.75% Cash, 1.00% PIK/Q)    

12/13/2018

    18.8     18.7 (2)(14)      

      Second lien senior secured loan ($46.8 par due 6/2024)   11.25% PIK (Libor + 8.75%/Q)    

12/13/2018

    46.8     46.3 (2)(14)      

                      65.6     65.0        

F-150


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

TerSera Therapeutics LLC

  Acquirer and developer of specialty therapeutic pharmaceutical products   First lien senior secured loan ($1.1 par due 3/2024)   7.85% (Libor + 5.25%/Q)    

7/12/2018

    1.1     1.1 (2)(14)      

      First lien senior secured loan ($1.1 par due 3/2024)   7.85% (Libor + 5.25%/Q)    

7/12/2018

    1.1     1.1 (2)(14)      

      First lien senior secured loan ($2.2 par due 3/2024)   7.85% (Libor + 5.25%/Q)    

7/12/2018

    2.2     2.2 (2)(14)      

      First lien senior secured loan ($2.1 par due 3/2023)   7.85% (Libor + 5.25%/Q)    

9/27/2018

    2.1     2.1 (2)(14)      

      First lien senior secured loan ($5.2 par due 3/2023)   7.85% (Libor + 5.25%/Q)    

5/3/2017

    5.2     5.2 (4)(14)      

                      11.7     11.7        

                                     

U.S. Anesthesia Partners, Inc.

  Anesthesiology service provider   Second lien senior secured loan ($71.8 par due 6/2025)   9.75% (Libor + 7.25%/M)    

6/16/2017

    71.0     71.1 (2)(14)      

                                     

United Digestive MSO Parent, LLC(18)

  Gastroenterology physician group   First lien senior secured loan ($12.6 par due 12/2024)   7.24% (Libor + 4.50%/Q)    

12/14/2018

    12.6     12.4 (2)(14)      

                                     

Urgent Cares of America Holdings I, LLC and FastMed Holdings I, LLC(18)

  Operator of urgent care clinics   Preferred units (7,696,613 units)        

6/11/2015

    7.7     5.4        

      Series A common units (2,000,000 units)        

6/11/2015

    2.0            

      Series C common units (5,288,427 units)        

6/11/2015

               

                      9.7     5.4        

                                     

Urology Management Associates, LLC and JWC/UMA Holdings, L.P.

  Urology private practice   First lien senior secured loan ($9.8 par due 8/2024)   7.50% (Libor + 5.00%/M)    

8/31/2018

    9.7     9.8 (2)(14)      

      Limited partnership interests (3.64% interest)        

8/31/2018

    4.8     5.0 (2)      

                      14.5     14.8        

                                     

Verscend Holding Corp.(18)

  Healthcare analytics solutions provider   First lien senior secured loan ($67.1 par due 8/2025)   7.00% (Libor + 4.50%/M)    

8/27/2018

    66.6     66.4 (2)(14)      

                                     

VistaPharm, Inc. and Vertice Pharma UK Parent Limited

  Manufacturer and distributor of generic pharmaceutical products   Preferred shares (40,662 shares)   8.00% PIK    

12/21/2015

    0.3     0.5 (8)      

F-151


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

West Dermatology, LLC(18)

  Dermatology practice platform   First lien senior secured revolving loan ($0.8 par due 4/2022)   8.30% (Libor + 5.50%/Q)    

2/8/2018

    0.8     0.8 (2)(14)      

      First lien senior secured revolving loan ($0.6 par due 4/2022)   8.13% (Libor + 5.50%/Q)    

2/8/2018

    0.6     0.6 (2)(14)      

      First lien senior secured revolving loan ($3.7 par due 4/2022)   8.11% (Libor + 5.50%/Q)    

2/8/2018

    3.7     3.7 (2)(14)      

      First lien senior secured loan ($0.9 par due 4/2023)   8.28% (Libor + 5.50%/Q)    

4/2/2018

    0.9     0.9 (2)(14)      

      First lien senior secured loan ($1.3 par due 4/2023)   8.13% (Libor + 5.50%/Q)    

4/2/2018

    1.3     1.3 (2)(14)      

      First lien senior secured loan ($0.8 par due 4/2023)   8.10% (Libor + 5.50%/Q)    

4/2/2018

    0.8     0.8 (2)(14)      

      First lien senior secured loan ($5.7 par due 4/2023)   8.11% (Libor + 5.50%/Q)    

4/2/2018

    5.7     5.7 (2)(14)      

      First lien senior secured loan ($0.8 par due 4/2023)   8.29% (Libor + 5.50%/Q)    

9/5/2018

    0.8     0.8 (2)(14)      

      First lien senior secured loan ($0.1 par due 4/2023)   8.25% (Libor + 5.50%/Q)    

9/5/2018

    0.1     0.1 (2)(14)      

      First lien senior secured loan ($1.3 par due 4/2023)   8.13% (Libor + 5.50%/Q)    

9/5/2018

    1.3     1.3 (2)(14)      

      First lien senior secured loan ($0.2 par due 4/2023)   8.11% (Libor + 5.50%/Q)    

9/5/2018

    0.2     0.2 (2)(14)      

      First lien senior secured loan ($2.9 par due 4/2023)   8.11% (Libor + 5.50%/Q)    

9/5/2018

    2.9     2.9 (2)(14)      

      First lien senior secured loan ($7.6 par due 4/2023)   8.11% (Libor + 5.50%/Q)    

4/2/2018

    7.6     7.6 (2)(14)      

                      26.7     26.7        

                                     

WIRB—Copernicus Group, Inc.(18)

  Provider of regulatory, ethical, and safety review services for clinical research involving human subjects   First lien senior secured revolving loan      

2/8/2018

        (16)      

                      3,070.2     2,894.3     39.44 %

                                     

Business Services

                                     

                                     

Accommodations Plus Technologies LLC and Accommodations Plus Technologies Holdings LLC(18)

  Provider of outsourced crew accommodations and logistics management solutions to the airline industry   Class A common units (236,358 units)        

5/11/2018

    4.5     6.5        

                                     

Achilles Acquisition LLC(18)

  Benefits broker and outsourced workflow automation platform provider for brokers   First lien senior secured loan ($16.7 par due 10/2025)   6.50% (Libor + 4.00%/M)    

10/11/2018

    16.7     16.7 (2)(14)      

      First lien senior secured loan ($21.4 par due 10/2025)   6.50% (Libor + 4.00%/M)    

10/11/2018

    21.4     21.3 (2)(14)      

                      38.1     38.0        

                                     

Alera Group Intermediate Holdings, Inc.(18)

  Insurance service provider   Second lien senior secured loan ($26.2 par due 3/2026)   11.00% (Libor + 8.50%/M)    

3/5/2019

    26.2     25.9 (2)(14)      

                                     

Apptio, Inc.(18)

  Provider of cloud-based technology business management solutions   First lien senior secured loan ($50.8 par due 1/2025)   9.74% (Libor + 7.25%/M)    

1/10/2019

    50.8     50.3 (2)(14)      

                                     

Avetta, LLC(18)

  Supply chain risk management SaaS platform for global enterprise clients   First lien senior secured loan ($51.8 par due 4/2024)   7.98% (Libor + 5.50%/M)    

4/10/2018

    51.8     51.8 (2)(14)      

F-152


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Blue Campaigns Intermediate Holding Corp. and Elevate Parent, Inc. (dba EveryAction)(18)

  Provider of fundraising and organizing efforts and digital services to non-profits and political campaigns   First lien senior secured loan ($27.5 par due 8/2023)   9.39% (Libor + 6.75%/Q)    

8/20/2018

    27.5     27.5 (2)(14)      

      Series A preferred stock (150,000 shares)        

9/26/2018

    1.5     1.7        

                      29.0     29.2        

                                     

CallMiner, Inc.

  Provider of cloud-based conversational analytics solutions   Warrant to purchase up to 2,350,636 shares of Series 1 preferred stock (expires 7/2024)        

7/23/2014

        (2)      

                                     

Chesapeake Research Review, LLC and Schulman Associates Institutional Review Board, Inc.(18)

  Provider of central institutional review boards over clinical trials   First lien senior secured loan ($3.8 par due 11/2023)   8.35% (Libor + 5.75%/Q)    

2/28/2019

    3.8     3.8 (2)(14)      

                                     

CMW Parent LLC (fka Black Arrow, Inc.)

  Multiplatform media firm   Series A units (32 units)        

9/11/2015

        (2)      

                                     

Command Alkon Incorporated(18)

  Software solutions provider to the ready-mix concrete industry   First lien senior secured revolving loan ($4.1 par due 9/2022)   9.50% (Base Rate + 4.00%/M)    

9/1/2017

    4.1     4.0 (2)(14)(17)      

      First lien senior secured loan ($20.3 par due 9/2023)   7.49% (Libor + 5.00%/M)    

9/1/2017

    20.3     19.7 (2)(14)      

      Second lien senior secured loan ($33.8 par due 3/2024)   11.49% (Libor + 9.00%/M)    

9/1/2017

    33.8     31.7 (2)(14)      

                      58.2     55.4        

                                     

Compuware Parent, LLC

  Web and mobile cloud performance testing and monitoring services provider   Class A-1 common stock (4,132 units)        

12/15/2014

    2.3     2.2 (2)      

      Class B-1 common stock (4,132 units)        

12/15/2014

    0.5     0.4 (2)      

      Class C-1 common stock (4,132 units)        

12/15/2014

    0.3     0.3 (2)      

      Class A-2 common stock (4,132 units)        

12/15/2014

        (2)      

      Class B-2 common stock (4,132 units)        

12/15/2014

        (2)      

      Class C-2 common stock (4,132 units)        

12/15/2014

        (2)      

                      3.1     2.9        

                                     

Directworks, Inc. and Co-Exprise Holdings, Inc.

  Provider of cloud-based software solutions for direct materials sourcing and supplier management for manufacturers   First lien senior secured loan ($1.8 par due 4/2018)        

12/19/2014

    1.3     (2)(13)      

      Warrant to purchase up to 1,875,000 shares of Series 1 preferred stock (expires 12/2024)        

12/19/2014

        (2)      

                      1.3            

                                     

Display Holding Company, Inc., Saldon Holdings, Inc. and Fastsigns Holdings Inc.(18)

  Provider of visual communications solutions   First lien senior secured revolving loan ($0.1 par due 3/2024)   9.25% (Base Rate + 3.75%/Q)    

3/13/2019

    0.1     0.1 (2)(14)      

      First lien senior secured loan ($16.4 par due 3/2025)   7.25% (Libor + 4.75%/M)    

3/13/2019

    16.4     16.3 (2)(14)      

      Common units (600 units)        

3/13/2019

    0.6     0.6 (2)      

                      17.1     17.0        

F-153


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Doxim Inc.(8)(18)

  Enterprise content management provider   First lien senior secured loan ($0.6 par due 2/2024)   8.48% (Libor + 6.00%/M)    

2/28/2018

    0.6     0.6 (2)(11)(14)      

      First lien senior secured loan ($4.2 par due 2/2024)   8.61% (Libor + 6.00%/Q)    

2/28/2018

    4.2     4.2 (2)(11)(14)      

      First lien senior secured loan ($10.2 par due 2/2024)   8.60% (Libor + 6.00%/Q)    

2/28/2018

    10.1     10.2 (2)(11)(14)      

                      14.9     15.0        

                                     

DRB Holdings, LLC(18)

  Provider of integrated technology solutions to car wash operators   First lien senior secured revolving loan ($3.3 par due 10/2023)   8.61% (Libor + 6.00%/Q)    

10/6/2017

    3.3     3.3 (2)(14)      

      First lien senior secured revolving loan ($2.0 par due 10/2023)   10.50% (Base Rate + 5.00%/S)    

10/6/2017

    2.0     2.0 (2)(14)      

      First lien senior secured loan ($23.7 par due 10/2023)   8.60% (Libor + 6.00%/Q)    

10/6/2017

    23.7     23.7 (3)(14)      

                      29.0     29.0        

                                     

DTI Holdco, Inc. and OPE DTI Holdings, Inc.(18)

  Provider of legal process outsourcing and managed services   First lien senior secured revolving loan ($0.9 par due 9/2021)   7.00% (Libor + 4.50%/M)    

9/23/2016

    0.9     0.9 (2)(14)      

      First lien senior secured revolving loan ($1.3 par due 9/2021)   6.99% (Libor + 4.50%/M)    

9/23/2016

    1.3     1.3 (2)(14)      

      Class A common stock (7,500 shares)        

8/19/2014

    7.5     7.4 (2)      

      Class B common stock (7,500 shares)        

8/19/2014

        (2)      

                      9.7     9.6        

                                     

Emergency Communications Network, LLC(18)

  Provider of mission critical emergency mass notification solutions   First lien senior secured loan ($25.1 par due 6/2023)   8.75% (Libor + 6.25%/M)    

6/1/2017

    24.9     24.1 (2)(14)      

      First lien senior secured loan ($19.7 par due 6/2023)   8.75% (Libor + 6.25%/M)    

6/1/2017

    19.6     18.9 (4)(14)      

                      44.5     43.0        

                                     

Entertainment Partners, LLC and Entertainment Partners Canada Inc.(18)

  Provider of entertainment workforce and production management solutions   First lien senior secured loan ($2.7 par due 5/2022)   7.47% (CIBOR + 5.50%/M)    

5/8/2017

    2.6     2.6 (2)(8)(14)      

      First lien senior secured loan ($1.0 par due 5/2022)   7.69% (CIBOR + 5.50%/Q)    

5/8/2017

    0.9     0.9 (2)(8)(14)      

      First lien senior secured loan ($2.7 par due 5/2022)   7.85% (CIBOR + 5.50%/S)    

5/8/2017

    2.6     2.6 (2)(8)(14)      

      First lien senior secured loan ($21.8 par due 5/2023)   8.25% (Libor + 5.75%/M)    

5/8/2017

    21.8     21.8 (3)(14)      

      First lien senior secured loan ($26.4 par due 5/2023)   8.49% (Libor + 5.75%/Q)    

5/8/2017

    26.4     26.4 (3)(14)      

      First lien senior secured loan ($26.4 par due 5/2023)   8.59% (Libor + 5.75%/Q)    

5/8/2017

    26.4     26.4 (3)(14)      

                      80.7     80.7        

                                     

Episerver Inc. and Goldcup 17308 AB(18)

  Provider of web content management and digital commerce solutions   First lien senior secured loan ($27.7 par due 10/2024)   8.25% (Libor + 5.75%/M)    

10/9/2018

    27.7     27.4 (2)(14)      

      First lien senior secured loan ($6.1 par due 10/2024)   8.61% (EURIBOR + 6.00%/Q)    

3/22/2019

    6.1     6.1 (2)(8)(14)      

                      33.8     33.5        

                                     

First Insight, Inc.

  Software company providing merchandising and pricing solutions to companies worldwide   Warrant to purchase up to 122,827 units of Series C preferred stock (expires 3/2024)        

3/20/2014

        (2)      

F-154


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Foundation Risk Partners, Corp.(18)

  Full service independent insurance agency   First lien senior secured revolving loan ($3.6 par due 11/2023)   7.35% (Libor + 4.75%/Q)    

11/10/2017

    3.6     3.6 (2)(14)      

      First lien senior secured loan ($22.2 par due 11/2023)   7.35% (Libor + 4.75%/Q)    

11/10/2017

    22.2     22.2 (3)(14)      

      Second lien senior secured loan ($6.3 par due 11/2024)   11.20% (Libor + 8.50%/Q)    

8/9/2018

    6.3     6.3 (2)(14)      

      Second lien senior secured loan ($15.4 par due 11/2024)   11.10% (Libor + 8.50%/Q)    

8/9/2018

    15.4     15.4 (2)(14)      

      Second lien senior secured loan ($19.1 par due 11/2024)   11.10% (Libor + 8.50%/Q)    

8/9/2018

    19.1     19.1 (2)(14)      

      Second lien senior secured loan ($27.5 par due 11/2024)   11.10% (Libor + 8.50%/Q)    

11/10/2017

    27.5     27.5 (2)(14)      

                      94.1     94.1        

                                     

Genesis Acquisition Co. and Genesis Holding Co.(18)

  Child care management software and services provider   First lien senior secured loan ($5.5 par due 7/2024)   6.60% (Libor + 4.00%/Q)    

7/31/2018

    5.5     5.5 (2)(14)      

      Second lien senior secured loan ($25.8 par due 7/2025)   10.24% (Libor + 7.50%/Q)    

7/31/2018

    25.8     25.8 (2)(14)      

      Class A common stock (8 shares)        

7/31/2018

    0.8     0.8 (2)      

                      32.1     32.1        

                                     

GTCR-Ultra Holdings III, LLC and GTCR-Ultra Holdings LLC(18)

  Provider of payment processing and merchant acquiring solutions   First lien senior secured loan ($6.5 par due 8/2024)   7.75% (Libor + 5.25%/M)    

8/1/2017

    6.5     6.5 (2)(14)      

      Class A-2 units (911 units)        

8/1/2017

    0.9     1.3 (2)      

      Class B units (2,878,372 units)        

8/1/2017

        (2)      

                      7.4     7.8        

                                     

HAI Acquisition Corporation and Aloha Topco, LLC(18)

  Professional employer organization offering human resources, compliance and risk management services   First lien senior secured loan ($66.0 par due 11/2024)   8.74% (Libor + 6.00%/Q)    

11/1/2017

    66.0     66.0 (3)(14)      

      Class A units (16,980 units)        

11/1/2017

    1.7     2.1 (2)      

                      67.7     68.1        

                                     

IfByPhone Inc.

  Voice-based marketing automation software provider   Warrant to purchase up to 124,300 shares of Series C preferred stock (expires 10/2022)        

10/15/2012

    0.1     0.1 (2)      

                                     

Implementation Management Assistance, LLC(18)

  Revenue cycle consulting firm to the healthcare industry   First lien senior secured revolving loan ($10.3 par due 12/2023)   7.10% (Libor + 4.50%/Q)    

12/13/2017

    10.3     10.1 (2)(14)      

      First lien senior secured loan ($16.9 par due 12/2023)   7.10% (Libor + 4.50%/Q)    

12/13/2017

    16.9     16.6 (2)(14)      

                      27.2     26.7        

                                     

Infinite Electronics, Inc.(18)

  Manufacturer and distributor of radio frequency and microwave electronic components   First lien senior secured revolving loan      

7/2/2018

        (16)      

      First lien senior secured loan ($10.3 par due 7/2025)   6.50% (Libor + 4.00%/M)    

7/2/2018

    10.3     10.3 (2)(14)      

                      10.3     10.3        

F-155


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Infogix, Inc. and Infogix Parent Corporation(18)

  Enterprise data analytics and integrity software solutions provider   Series A preferred stock (2,475 shares)   9.00% PIK    

1/3/2017

    2.5     2.5        

      Common stock (1,297,768 shares)        

1/3/2017

               

                      2.5     2.5        

                                     

Inmar, Inc.

  Technology-driven solutions provider for retailers, wholesalers and manufacturers   First lien senior secured loan ($26.8 par due 5/2024)   6.60% (Libor + 4.00%/Q)    

1/31/2019

    25.4     25.4 (2)(14)      

      Second lien senior secured loan ($28.3 par due 5/2025)   10.60% (Libor + 8.00%/Q)    

4/25/2017

    28.0     27.4 (2)(14)      

                      53.4     52.8        

                                     

InterVision Systems, LLC and InterVision Holdings, LLC

  Provider of cloud based IT solutions, infrastructure and services   First lien senior secured loan ($16.4 par due 5/2022)   10.26% (Libor + 7.77%/M)    

5/31/2017

    16.4     15.5 (2)(14)      

      First lien senior secured loan ($24.7 par due 5/2022)   10.97% (Libor + 8.47%/M)    

5/31/2017

    24.7     23.5 (2)(14)      

      First lien senior secured loan ($10.0 par due 5/2022)   10.97% (Libor + 8.47%/M)    

5/31/2017

    10.0     9.5 (4)(14)      

      Class A membership units (1,000 units)        

5/31/2017

    1.0     0.4        

                      52.1     48.9        

                                     

Invoice Cloud, Inc.(18)

  Provider of electronic payment processing solutions   First lien senior secured loan ($32.4 par due 2/2024)   9.20% (Libor + 6.50%/Q)    

2/11/2019

    32.4     32.1 (2)(14)      

                                     

iParadigms Holdings, LLC

  Anti-plagiarism software provider to the education market   Second lien senior secured loan ($32.5 par due 7/2022)   9.85% (Libor + 7.25%/Q)    

1/3/2017

    32.1     32.5 (2)(14)      

                                     

iPipeline, Inc., Internet Pipeline, Inc., iPipeline Limited and iPipeline Holdings, Inc.(18)

  Provider of SaaS-based software solutions to the insurance and financial services industry   First lien senior secured loan ($11.4 par due 8/2022)   7.25% (Libor + 4.75%/M)    

12/18/2017

    11.7     11.4 (2)(8)(14)      

      First lien senior secured loan ($7.4 par due 8/2022)   7.25% (Libor + 4.75%/M)    

6/15/2017

    7.4     7.4 (4)(14)      

      First lien senior secured loan ($5.0 par due 8/2022)   7.25% (Libor + 4.75%/M)    

9/15/2017

    5.0     5.0 (4)(14)      

      First lien senior secured loan ($16.2 par due 8/2022)   7.25% (Libor + 4.75%/M)    

8/4/2015

    16.2     16.2 (3)(14)      

      First lien senior secured loan ($14.5 par due 8/2022)   7.25% (Libor + 4.75%/M)    

8/4/2015

    14.5     14.5 (4)(14)      

      Preferred stock (1,100 shares)        

8/4/2015

    1.1     5.2 (2)      

      Common stock (668,781 shares)        

8/4/2015

        0.1 (2)      

                      55.9     59.8        

                                     

IRI Holdings, Inc., IRI Group Holdings, Inc. and IRI Parent, L.P.

  Market research company focused on the consumer packaged goods industry   First lien senior secured loan ($31.6 par due 11/2025)   7.13% (Libor + 4.50%/Q)    

11/30/2018

    31.3     30.9 (2)(14)      

      First lien senior secured loan ($34.9 par due 11/2025)   7.13% (Libor + 4.50%/Q)    

11/30/2018

    34.6     34.2 (3)(14)      

      Second lien senior secured loan ($86.8 par due 11/2026)   10.63% (Libor + 8.00%/Q)    

11/30/2018

    85.3     85.1 (2)(14)      

      Series A-1 preferred shares (46,900 shares)   13.39% PIK (Libor + 10.79%)    

11/30/2018

    48.3     49.0 (2)(14)      

      Class A-1 common units (90,500 units)        

11/30/2018

    9.1     9.1 (2)      

                      208.6     208.3        

F-156


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Kaufman, Hall & Associates, LLC(18)

  Provider of specialty advisory services and software solutions to the healthcare market   First lien senior secured revolving loan ($0.5 par due 11/2023)   7.49% (Libor + 5.00%/M)    

11/9/2018

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($5.5 par due 5/2025)   7.74% (Libor + 5.25%/M)    

11/9/2018

    5.5     5.4 (2)(14)      

      First lien senior secured loan ($8.2 par due 5/2025)   7.74% (Libor + 5.25%/M)    

11/9/2018

    8.2     8.1 (4)(14)      

      First lien senior secured loan ($4.5 par due 5/2025)   7.93% (Libor + 5.25%/S)    

11/9/2018

    4.5     4.5 (2)(14)      

      First lien senior secured loan ($6.8 par due 5/2025)   7.93% (Libor + 5.25%/S)    

11/9/2018

    6.8     6.7 (4)(14)      

                      25.5     25.2        

                                     

Labstat International Inc.(8)(18)

  Lab testing services for nicotine containing products   First lien senior secured loan ($5.2 par due 6/2024)   8.27% (CIBOR + 6.25%/Q)    

10/19/2018

    5.2     5.1 (2)(14)      

      First lien senior secured loan ($19.9 par due 6/2024)   8.27% (CIBOR + 6.25%/Q)    

6/25/2018

    19.6     19.6 (2)(14)      

                      24.8     24.7        

                                     

LLSC Holdings Corporation (dba Lawrence Merchandising Services)(7)

  Marketing services provider   Series A preferred stock (9,000 shares)        

1/3/2017

    1.8     0.4        

      Common stock (1,000 shares)        

1/3/2017

               

                      1.8     0.4        

                                     

Masergy Holdings, Inc.(18)

  Provider of software-defined solutions for enterprise global networks, cyber security, and cloud communications   First lien senior secured revolving loan      

2/8/2018

        (16)      

                                     

Ministry Brands, LLC and MB Parent HoldCo, L.P. (dba Community Brands)(18)

  Software and payment services provider to faith-based institutions   First lien senior secured loan ($4.9 par due 12/2022)   6.50% (Libor + 4.00%/M)    

8/22/2017

    4.9     4.9 (2)(14)      

      First lien senior secured loan ($10.5 par due 12/2022)   6.50% (Libor + 4.00%/M)    

4/6/2017

    10.5     10.5 (2)(14)      

      First lien senior secured loan ($14.5 par due 12/2022)   6.50% (Libor + 4.00%/M)    

4/6/2017

    14.4     14.5 (2)(14)      

      Second lien senior secured loan ($16.6 par due 6/2023)   11.88% (Libor + 9.25%/Q)    

12/2/2016

    16.6     16.6 (2)(14)      

      Second lien senior secured loan ($2.5 par due 6/2023)   11.88% (Libor + 9.25%/Q)    

8/22/2017

    2.5     2.5 (2)(14)      

      Second lien senior secured loan ($15.4 par due 6/2023)   11.88% (Libor + 9.25%/Q)    

8/22/2017

    15.4     15.4 (2)(14)      

      Second lien senior secured loan ($4.7 par due 6/2023)   11.88% (Libor + 9.25%/Q)    

4/6/2017

    4.7     4.7 (2)(14)      

      Second lien senior secured loan ($0.2 par due 6/2023)   10.50% (Libor + 8.00%/M)    

4/18/2018

    0.2     0.2 (2)(14)      

      Second lien senior secured loan ($2.2 par due 6/2023)   10.50% (Libor + 8.00%/M)    

4/18/2018

    2.2     2.2 (2)(14)      

      Second lien senior secured loan ($7.0 par due 6/2023)   10.63% (Libor + 8.00%/Q)    

4/18/2018

    7.0     7.0 (2)(14)      

      Second lien senior secured loan ($0.8 par due 6/2023)   10.63% (Libor + 8.00%/Q)    

4/18/2018

    0.8     0.8 (2)(14)      

      Second lien senior secured loan ($9.2 par due 6/2023)   11.88% (Libor + 9.25%/Q)    

4/6/2017

    9.2     9.2 (2)(14)      

      Second lien senior secured loan ($38.6 par due 6/2023)   10.63% (Libor + 8.00%/Q)    

4/18/2018

    38.6     38.6 (2)(14)      

      Second lien senior secured loan ($75.0 par due 6/2023)   11.88% (Libor + 9.25%/Q)    

12/2/2016

    74.5     75.0 (2)(14)      

      Second lien senior secured loan ($15.0 par due 6/2023)   11.88% (Libor + 9.25%/Q)    

12/2/2016

    14.9     15.0 (3)(14)      

      Class A units (500,000 units)        

12/2/2016

    5.0     6.4 (2)      

                      221.4     223.5        

F-157


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

MVL Group, Inc.(7)

  Marketing research provider   Common stock (560,716 shares)        

4/1/2010

        (2)      

                                     

NAS, LLC, Nationwide Marketing Group, LLC and Nationwide Administrative Services, Inc.

  Buying and marketing services organization for appliance, furniture and consumer electronics dealers   Second lien senior secured loan ($24.1 par due 12/2021)   11.35% (Libor + 8.75%/Q)    

6/1/2015

    24.1     24.1 (2)(14)      

      Second lien senior secured loan ($7.0 par due 12/2021)   11.35% (Libor + 8.75%/Q)    

6/1/2015

    7.0     7.0 (2)(14)      

                      31.1     31.1        

                                     

Novetta Solutions, LLC

  Provider of advanced analytics solutions for the government, defense and commercial industries   First lien senior secured loan ($8.6 par due 10/2022)   7.50% (Libor + 5.00%/M)    

1/3/2017

    8.4     8.3 (4)(14)      

      Second lien senior secured loan ($31.0 par due 10/2023)   11.00% (Libor + 8.50%/M)    

1/3/2017

    29.1     28.5 (2)(14)      

                      37.5     36.8        

                                     

NSM Insurance Group, LLC

  Insurance program administrator   First lien senior secured loan ($13.1 par due 5/2024)   7.10% (Libor + 4.50%/Q)    

5/11/2018

    13.1     13.1 (3)(14)      

                                     

PayNearMe, Inc.

  Electronic cash payment system provider   Warrant to purchase up to 195,726 shares of Series E preferred stock (expires 3/2023)        

3/11/2016

    0.2     (2)      

                                     

PDI TA Holdings, Inc., Peachtree Parent, Inc. and Insight PDI Holdings, LLC(18)

  Provider of enterprise management software for the convenience retail and petroleum wholesale market   First lien senior secured loan ($55.0 par due 10/2024)   7.13% (Libor + 3.50%/Q)    

3/19/2019

    55.0     54.9 (2)(14)      

      Second lien senior secured loan ($70.1 par due 10/2025)   11.13% (Libor + 8.50%/Q)    

3/19/2019

    70.1     70.0 (2)(14)      

      Series A preferred shares (13,656 shares)   13.25% PIK    

3/19/2019

    13.4     13.7 (2)      

      Class A units (1,942,225 units)        

3/19/2019

    1.9     1.9 (2)      

                      140.4     140.5        

                                     

Perforce Software, Inc.(18)

  Developer of software used for application development   First lien senior secured loan ($47.9 par due 12/2024)   9.00% (Base Rate + 3.50%/M)    

2/8/2019

    47.6     47.6 (2)(14)      

                                     

PHL Investors, Inc., and PHL Holding Co.(7)

  Mortgage services   Class A common stock (576 shares)        

7/31/2012

    3.8     (2)      

                                     

PHNTM Holdings, Inc. and Planview Parent, Inc.

  Provider of project and portfolio management software   Second lien senior secured loan ($62.0 par due 7/2023)   12.25% (Libor + 9.75%/M)    

1/27/2017

    61.4     62.0 (2)(14)      

      Class A common shares (990 shares)        

1/27/2017

    1.0     1.8 (2)      

      Class B common shares (168,329 shares)        

1/27/2017

        0.3 (2)      

                      62.4     64.1        

                                     

Poplicus Incorporated

  Business intelligence and market analytics platform for companies that sell to the public sector   Warrant to purchase up to 2,402,991 shares of Series C preferred stock (expires 6/2025)        

6/25/2015

    0.1     (2)      

F-158


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Production Resource Group, L.L.C.

  Provider of rental equipment, labor, production management, scenery, and other products to various entertainment end-markets   First lien senior secured loan ($21.0 par due 8/2024)   9.65% (Libor + 7.00%/Q)    

8/21/2018

    21.0     20.2 (2)(14)      

      First lien senior secured loan ($80.0 par due 8/2024)   9.65% (Libor + 7.00%/Q)    

8/21/2018

    80.0     76.8 (3)(14)      

                      101.0     97.0        

                                     

Project Alpha Intermediate Holding, Inc. and Qlik Parent, Inc.

  Provider of data visualization software for data analytics   Class A common shares (7,445 shares)        

8/22/2016

    7.4     10.7 (2)      

      Class B common shares (1,841,609 shares)        

8/22/2016

    0.1     0.1 (2)      

                      7.5     10.8        

                                     

R2 Acquisition Corp.

  Marketing services   Common stock (250,000 shares)        

5/29/2007

    0.3     0.2 (2)      

                                     

SCM Insurance Services Inc.(18)

  Provider of claims management, claims investigation & support and risk management solutions for the Canadian property and casualty insurance industry   First lien senior secured revolving loan ($4.1 par due 8/2022)   7.95% (Base Rate + 4.00%/Q)    

8/29/2017

    4.1     4.0 (2)(14)      

      First lien senior secured loan ($20.2 par due 8/2024)   6.97%
(CIBOR + 5.00%/M)
   

8/29/2017

    21.2     19.5 (2)(8)(14)      

      Second lien senior secured loan ($57.8 par due 3/2025)   10.97%
(CIBOR + 9.00%/M)
   

8/29/2017

    60.5     54.5 (2)(8)(14)      

                      85.8     78.0        

                                     

Shift PPC LLC(18)

  Digital solutions provider   First lien senior secured loan ($1.0 par due 12/2021)   7.00% (Libor + 4.50%/M)    

12/22/2016

    1.0     1.0 (2)(14)      

      First lien senior secured loan ($1.0 par due 12/2021)   7.38% (Libor + 4.50%/S)    

12/22/2016

    1.0     1.0 (2)(14)      

                      2.0     2.0        

                                     

SpareFoot, LLC(18)

  PMS solutions and web services for the self-storage industry   First lien senior secured revolving loan ($0.3 par due 4/2023)   6.74% (Libor + 4.25%/M)    

4/13/2018

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($1.2 par due 4/2024)   6.74% (Libor + 4.25%/M)    

8/31/2018

    1.1     1.2 (2)(14)      

      First lien senior secured loan ($4.7 par due 4/2024)   6.74% (Libor + 4.25%/M)    

4/13/2018

    4.6     4.7 (2)(14)      

      First lien senior secured loan ($0.5 par due 4/2024)   6.75% (Libor + 4.25%/Q)    

3/29/2019

    0.5     0.5 (2)(14)      

      Second lien senior secured loan ($4.2 par due 4/2025)   10.75% (Libor + 8.25%/M)    

8/31/2018

    4.1     4.2 (2)(14)      

      Second lien senior secured loan ($6.1 par due 4/2025)   10.75% (Libor + 8.25%/M)    

4/13/2018

    6.0     6.1 (2)(14)      

                      16.6     17.0        

                                     

Sparta Systems, Inc., Project Silverback Holdings Corp. and Silverback Holdings, Inc.(18)

  Quality management software provider   Second lien senior secured loan ($20.0 par due 8/2025)   10.75% (Libor + 8.25%/M)    

8/21/2017

    19.7     16.8 (2)(14)      

      Series B preferred shares (10,084 shares)        

8/21/2017

    1.1            

                      20.8     16.8        

                                     

Telestream Holdings Corporation(18)

  Provider of digital video tools and workflow solutions to the media and entertainment industries   First lien senior secured revolving loan      

2/8/2018

        (16)      

                                     

F-159


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

TU BidCo, Inc.(18)

  Provider of outsourced customer service management solutions and back-office support services to e-commerce, software and tech-enabled services industries   First lien senior secured revolving loan      

10/1/2018

        (16)      

      First lien senior secured loan ($18.0 par due 10/2023)   6.50% (Libor + 4.00%/M)    

10/1/2018

    18.0     17.9 (3)(14)      

                      18.0     17.9        

                                     

UL Holding Co., LLC(6)

  Provider of collection and landfill avoidance solutions for food waste and unsold food products   Senior subordinated loan ($3.2 par due 5/2020)   10.00% PIK    

4/30/2012

    1.2     3.2 (2)      

      Senior subordinated loan ($0.4 par due 5/2020)        

4/30/2012

    0.2     0.4 (2)      

      Senior subordinated loan ($6.9 par due 5/2020)   10.00% PIK    

4/30/2012

    2.6     6.9 (2)      

      Senior subordinated loan ($0.5 par due 5/2020)        

4/30/2012

    0.2     0.5 (2)      

      Senior subordinated loan ($27.7 par due 5/2020)   10.00% PIK    

4/30/2012

    10.6     27.7 (2)      

      Senior subordinated loan ($3.8 par due 5/2020)        

4/30/2012

    1.4     3.8 (2)      

      Class A common units (533,351 units)        

6/17/2011

    5.0     0.2 (2)      

      Class B-5 common units (272,834 units)        

6/17/2011

    2.5     0.1 (2)      

      Class C common units (758,546 units)        

4/25/2008

        (2)      

      Warrant to purchase up to 719,044 shares of Class A units        

5/2/2014

        (2)      

      Warrant to purchase up to 28,663 shares of Class B-1 units        

5/2/2014

        (2)      

      Warrant to purchase up to 57,325 shares of Class B-2 units        

5/2/2014

        (2)      

      Warrant to purchase up to 29,645 shares of Class B-3 units        

5/2/2014

        (2)      

      Warrant to purchase up to 80,371 shares of Class B-5 units        

5/2/2014

        (2)      

      Warrant to purchase up to 59,655 shares of Class B-6 units        

5/2/2014

        (2)      

      Warrant to purchase up to 1,046,713 shares of Class C units        

5/2/2014

        (2)      

                      23.7     42.8        

                                     

Unison Software, Inc. (fka Compusearch Software Systems, Inc.)

  Provider of enterprise software and services for organizations in the public sector   Second lien senior secured loan ($51.0 par due 11/2021)   11.44% (Libor + 8.75%/Q)    

1/3/2017

    51.0     51.0 (3)(14)      

                                     

Velocity Holdings Corp.

  Hosted enterprise resource planning application management services provider   Common units (1,713,546 units)        

12/13/2013

    4.5     3.6        

                                     

F-160


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Visual Edge Technology, Inc.(18)

  Provider of outsourced office solutions with a focus on printer and copier equipment and other parts and supplies   First lien senior secured loan ($6.0 par due 8/2022)   8.24% (Libor + 5.75%/M)    

8/31/2017

    6.0     6.0 (2)(14)      

      First lien senior secured loan ($3.4 par due 8/2022)   8.25% (Libor + 5.75%/M)    

8/31/2017

    3.4     3.4 (2)(14)      

      First lien senior secured loan ($6.2 par due 8/2022)   8.25% (Libor + 5.75%/M)    

8/31/2017

    6.2     6.2 (2)(14)      

      First lien senior secured loan ($16.7 par due 8/2022)   8.25% (Libor + 5.75%/M)    

8/31/2017

    16.6     16.7 (2)(14)      

      Senior subordinated loan ($57.7 par due 9/2024)   12.50% PIK    

8/31/2017

    54.5     54.2 (2)      

      Warrant to purchase up to 1,961,452 shares of preferred stock (expires 8/2027)        

8/31/2017

    3.9     3.9 (2)      

      Warrant to purchase up to 1,720,432 shares of common stock (expires 8/2027)        

8/31/2017

        (2)      

                      90.6     90.4        

                                     

VRC Companies, LLC(18)

  Provider of records and information management services   First lien senior secured revolving loan ($0.8 par due 3/2022)   9.00% (Libor + 6.50%/M)    

4/17/2017

    0.8     0.8 (2)(14)      

      First lien senior secured revolving loan ($0.2 par due 3/2022)   11.00% (Base Rate + 5.50%/Q)    

4/17/2017

    0.2     0.2 (2)(14)      

      First lien senior secured loan ($0.2 par due 3/2023)   9.00% (Libor + 6.50%/M)    

1/29/2019

    0.2     0.2 (2)(14)      

      First lien senior secured loan ($1.6 par due 3/2023)   9.00% (Libor + 6.50%/M)    

1/29/2019

    1.6     1.6 (2)(14)      

      First lien senior secured loan ($9.1 par due 3/2023)   9.00% (Libor + 6.50%/M)    

3/31/2017

    9.1     9.1 (2)(14)      

                      11.9     11.9        

                                     

WorldPay Group PLC(8)

  Payment processing company   C2 shares (73,974 shares)        

10/21/2015

        (21)      

                                     

Worldwide Facilities, LLC(18)

  Specialty insurance wholesale broker   First lien senior secured revolving loan ($0.4 par due 4/2024)   6.75% (Libor + 4.25%/M)    

5/3/2018

    0.4     0.4 (2)(14)      

                                     

XIFIN, Inc.(18)

  Revenue cycle management provider to labs   First lien senior secured revolving loan      

2/8/2018

        (16)      

                                     

Zywave, Inc.(18)

  Provider of software and technology-enabled content and analytical solutions to insurance brokers   First lien senior secured revolving loan ($6.3 par due 11/2022)   7.50% (Libor + 5.00%/M)    

11/17/2016

    6.3     6.3 (2)(14)      

      Second lien senior secured loan ($27.0 par due 11/2023)   11.49% (Libor + 9.00%/M)    

11/17/2016

    27.0     27.0 (2)(14)      

                      33.3     33.3        

                      2,249.5     2,247.8     30.63 %

Consumer Products

               

 

                   

                                     

Badger Sportswear Acquisition, Inc.

  Provider of team uniforms and athletic wear   Second lien senior secured loan ($56.8 par due 3/2024)   11.50% (Libor + 9.00%/M)    

9/6/2016

    56.7     55.1 (2)(14)      

                                     

F-161


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

BRG Sports, Inc.

  Designer, manufacturer and licensor of branded sporting goods   Preferred stock (2,009 shares)        

1/3/2017

        0.2        

      Common stock (6,566,655 shares)        

1/3/2017

               

                          0.2        

                                     

CB Trestles OpCo, LLC(18)

  Apparel retailer   First lien senior secured revolving loan ($4.0 par due 10/2024)   8.45% (Libor + 5.75%/Q)    

10/26/2018

    4.0     4.0 (2)(14)      

      First lien senior secured loan ($26.5 par due 10/2024)   8.51% (Libor + 5.75%/S)    

10/26/2018

    26.5     26.2 (3)(14)      

                      30.5     30.2        

                                     

Centric Brands Inc. (fka Differential Brands Group Inc.)(8)

  Designer, marketer and distributor of licensed and owned apparel   First lien senior secured loan ($58.7 par due 10/2023)   8.75% (Libor + 6.00%/Q)    

10/29/2018

    58.7     58.1 (3)(14)      

      Common stock (3,077,875 shares)        

10/29/2018

    24.6     24.6 (2)      

                      83.3     82.7        

                                     

Consumer Health Parent LLC

  Developer and marketer of over-the-counter cold remedy products   Preferred units (1,072 units)        

12/15/2017

    1.1     0.3 (2)      

      Series A common units (1,072 units)        

12/15/2017

        (2)      

                      1.1     0.3        

                                     

Feradyne Outdoors, LLC and Bowhunter Holdings, LLC

  Provider of branded archery and bowhunting accessories   Common units (421 units)        

4/24/2014

    4.2     0.2 (2)      

                                     

Implus Footcare, LLC

  Provider of footwear and other accessories   First lien senior secured loan ($14.1 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

6/1/2017

    14.1     14.1 (2)(14)      

      First lien senior secured loan ($5.0 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

7/17/2018

    5.0     5.0 (2)(14)      

      First lien senior secured loan ($64.8 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

6/1/2017

    64.8     64.8 (2)(14)      

      First lien senior secured loan ($30.7 par due 4/2021)   9.35% (Libor + 6.75%/Q)    

6/1/2017

    30.7     30.7 (4)(14)      

      First lien senior secured loan ($0.2 par due 4/2021)   9.38% (Libor + 6.75%/Q)    

6/30/2016

    0.2     0.2 (2)(14)      

                      114.8     114.8        

                                     

Indra Holdings Corp.

  Designer, marketer, and distributor of rain and cold weather products   First lien senior secured loan ($10.0 par due 5/2021)   6.83% (Libor + 4.25%/Q)    

1/22/2018

    7.4     6.1 (2)(14)      

      Second lien senior secured loan ($80.0 par due 11/2021)        

5/1/2014

    66.7     15.0 (2)(13)      

                      74.1     21.1        

                                     

Plantation Products, LLC, Seed Holdings, Inc. and Flora Parent, Inc.

  Provider of branded lawn and garden products   Second lien senior secured loan ($56.0 par due 6/2021)   10.08% (Libor + 7.34%/Q)    

12/23/2014

    55.9     56.0 (3)(14)      

      Second lien senior secured loan ($10.0 par due 6/2021)   10.08% (Libor + 7.34%/Q)    

12/23/2014

    10.0     10.0 (4)(14)      

      Common stock (30,000 shares)        

12/23/2014

    3.0     6.3 (2)      

                      68.9     72.3        

                                     

F-162


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Rug Doctor, LLC and RD Holdco Inc.(7)

  Manufacturer and marketer of carpet cleaning machines   Second lien senior secured loan ($16.9 par due 10/2019)   12.43% (Libor + 9.75%/S)    

1/3/2017

    16.9     16.9 (2)(14)      

      Common stock (458,596 shares)        

1/3/2017

    14.0     4.4        

      Warrant to purchase up to 56,372 shares of common stock (expires 12/2023)        

1/3/2017

               

                      30.9     21.3        

                                     

S Toys Holdings LLC (fka The Step2 Company, LLC)(7)

  Toy manufacturer   Common units (1,116,879 units)        

4/1/2011

        0.3        

      Class B common units (126,278,000 units)        

10/30/2014

        (2)      

      Warrant to purchase up to 3,157,895 units        

4/1/2010

               

                          0.3        

                                     

SHO Holding I Corporation

  Manufacturer and distributor of slip resistant footwear   Second lien senior secured loan ($100.0 par due 4/2023)   11.24% (Libor + 8.50%/Q)    

10/27/2015

    98.6     92.0 (2)(14)      

                                     

Shock Doctor, Inc. and Shock Doctor Holdings, LLC(6)

  Developer, marketer and distributor of sports protection equipment and accessories   Second lien senior secured loan ($89.4 par due 10/2021)   13.78%
(Libor + 11.00%/Q)
   

4/22/2015

    89.4     77.8 (2)(14)      

      Class A preferred units (50,000 units)        

3/14/2014

    5.0     0.4 (2)      

      Class C preferred units (50,000 units)        

4/22/2015

    5.0     0.4 (2)      

                      99.4     78.6        

                                     

Singer Sewing Company, SVP-Singer Holdings, LLC and SVP-Singer Holdings LP(7)(18)

  Manufacturer of consumer sewing machines   First lien senior secured revolving loan ($2.0 par due 3/2023)   11.49% (Libor + 9.00%/Q)    

7/26/2017

    2.0     2.0 (2)(14)(17)      

      First lien senior secured revolving loan ($1.0 par due 3/2023)   11.58% (Libor + 9.00%/Q)    

7/26/2017

    1.0     1.0 (2)(14)(17)      

      First lien senior secured revolving loan ($1.5 par due 3/2023)   11.57% (Libor + 9.00%/M)    

7/26/2017

    1.5     1.5 (2)(14)(17)      

      First lien senior secured revolving loan ($71.9 par due 3/2023)   11.80% (Libor + 9.00%/Q)    

7/26/2017

    71.9     71.9 (2)(14)(17)      

      First lien senior secured revolving loan ($3.5 par due 3/2023)   11.80% (Libor + 9.00%/Q)    

7/26/2017

    3.5     3.5 (2)(14)(17)      

      First lien senior secured revolving loan ($2.0 par due 3/2023)   11.79% (Libor + 9.00%/Q)    

7/26/2017

    2.0     2.0 (2)(14)(17)      

      First lien senior secured revolving loan ($1.0 par due 3/2023)   11.78% (Libor + 9.00%/Q)    

7/26/2017

    1.0     1.0 (2)(14)(17)      

      First lien senior secured revolving loan ($1.5 par due 3/2023)   13.50% (Base Rate + 8.00%/M)    

7/26/2017

    1.5     1.5 (2)(14)(17)      

      First lien senior secured loan ($184.0 par due 3/2023)   5.00% (Libor + 2.40%/Q)    

7/26/2017

    174.6     151.0 (2)(14)      

      Class A common units (6,500,000 units)        

7/26/2017

        (2)      

                      259.0     235.4        

                                     

F-163


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Touchstone Acquisition, Inc. and Touchstone Holding, L.P.(18)

  Manufacturer of consumable products in the dental, medical, cosmetic and CPG/industrial end-markets   First lien senior secured loan ($41.2 par due 11/2025)   7.25% (Libor + 4.75%/M)    

11/15/2018

    41.2     40.7 (2)(14)      

      Class A preferred units (2,149 units)   8.00% PIK    

11/15/2018

    2.2     2.2 (2)      

                      43.4     42.9        

                                     

Varsity Brands Holding Co., Inc. and BCPE Hercules Holdings, LP

  Leading manufacturer and distributor of textiles, apparel & luxury goods   Second lien senior secured loan ($21.1 par due 12/2025)   10.75% (Libor + 8.25%/M)    

7/30/2018

    21.1     21.1 (2)(14)      

      Second lien senior secured loan ($47.7 par due 12/2025)   10.75% (Libor + 8.25%/M)    

12/15/2017

    47.7     47.7 (2)(14)      

      Second lien senior secured loan ($75.0 par due 12/2025)   10.75% (Libor + 8.25%/M)    

12/15/2017

    75.0     75.0 (3)(14)      

      Class A units (1,400 units)        

7/30/2018

    1.4     1.5 (2)      

                      145.2     145.3        

                                     

Woodstream Group, Inc. and Woodstream Corporation(18)

  Pet products manufacturer   First lien senior secured loan ($2.7 par due 5/2022)   8.89% (Libor + 6.25%/Q)    

6/21/2017

    2.7     2.7 (4)(14)      

      First lien senior secured loan ($4.4 par due 5/2022)   8.86% (Libor + 6.25%/Q)    

6/21/2017

    4.4     4.4 (4)(14)      

      First lien senior secured loan ($4.6 par due 5/2022)   9.10% (Libor + 6.25%/S)    

6/21/2017

    4.6     4.6 (4)(14)      

                      11.7     11.7        

                      1,121.8     1,004.4     13.69 %

Investment Funds and Vehicles

               

 

                   

                                     

ACAS Equity Holdings Corporation(7)(8)

  Investment company   Common stock (589 shares)        

1/3/2017

    0.4     0.4        

                                     

Ares IIIR/IVR CLO Ltd.(8)(8)

  Investment vehicle   Subordinated notes ($20.0 par due 4/2021)        

1/3/2017

        0.1        

                                     

Blue Wolf Capital Fund II, L.P.(6)(8)

  Investment partnership   Limited partnership interest (8.50% interest)        

1/3/2017

    1.6     2.5 (21)      

                                     

Carlyle Global Market Strategies CLO 2015-3(8)

  Investment vehicle   Subordinated notes ($24.6 par due 7/2028)   16.00%    

1/3/2017

    14.2     14.0        

                                     

CoLTs 2005-1 Ltd.(7)(8)

  Investment vehicle   Preferred shares (360 shares)        

1/3/2017

               

                                     

CoLTs 2005-2 Ltd.(7)(8)

  Investment vehicle   Preferred shares (34,170,000 shares)        

1/3/2017

               

                                     

CREST Exeter Street Solar 2004-1(8)

  Investment vehicle   Preferred shares (3,500,000 shares)        

1/3/2017

               

                                     

Eaton Vance CDO X plc(8)

  Investment vehicle   Subordinated notes ($9.2 par due 2/2027)        

1/3/2017

               

                                     

European Capital UK SME Debt LP(6)(8)(19)

  Investment partnership   Limited partnership interest (45% interest)        

1/3/2017

    40.2     39.6        

                                     

HCI Equity, LLC(7)(8)

  Investment company   Member interest (100.00% interest)        

4/1/2010

        0.1 (21)      

                                     

Herbert Park B.V.(8)

  Investment vehicle   Subordinated notes ($6.0 par due 10/2026)        

1/3/2017

    0.9            

                                     

OHA Credit Partners XI(8)

  Investment vehicle   Subordinated notes ($17.8 par due 1/2032)   13.9%    

1/3/2017

    13.5     13.8        

                                     

Partnership Capital Growth Fund I, L.P.(6)(8)

  Investment partnership   Limited partnership interest (25.00% interest)        

6/16/2006

        (2)(21)      

                                     

F-164


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Partnership Capital Growth Investors III, L.P.(8)(19)

  Investment partnership   Limited partnership interest (2.50% interest)        

10/5/2011

    2.5     4.2 (2)(21)      

                                     

PCG-Ares Sidecar Investment II, L.P.(6)(8)(19)

  Investment partnership   Limited partnership interest (100.00% interest)        

10/31/2014

    6.7     16.8 (2)      

                                     

PCG-Ares Sidecar Investment, L.P.(6)(8)(19)

  Investment partnership   Limited partnership interest (100.00% interest)        

5/22/2014

    4.5     4.4 (2)      

                                     

Piper Jaffray Merchant Banking Fund I, L.P.(8)(19)

  Investment partnership   Limited partnership interest (2.00% interest)        

8/16/2012

    1.4     1.5 (21)      

                                     

Senior Direct Lending Program, LLC(7)(8)(20)

  Co-investment vehicle   Subordinated certificates ($791.9 par due 12/2036)   10.6%
(Libor + 8.00%/Q)(15)
   

7/27/2016

    791.9     791.9        

      Member interest (87.50% interest)        

7/27/2016

               

                      791.9     791.9        

                                     

Vitesse CLO, Ltd.(8)

  Investment vehicle   Preferred shares (20,000,000 shares)        

1/3/2017

               

                                     

Voya CLO 2014-4 Ltd.(8)

  Investment vehicle   Subordinated notes ($26.7 par due 7/2031)   12.5%    

1/3/2017

    14.2     14.6        

                                     

VSC Investors LLC(8)

  Investment company   Membership interest (1.95% interest)        

1/24/2008

    0.3     0.9 (2)(21)      

                      892.3     904.8     12.33 %

Financial Services

               

 

                   

                                     

Amynta Agency Borrower Inc. and Amynta Warranty Borrower Inc.

  Insurance service provider   First lien senior secured loan ($10.8 par due 2/2025)   7.00% (Libor + 4.50%/M)    

12/21/2018

    10.8     10.5 (2)(14)      

      First lien senior secured loan ($16.3 par due 2/2025)   7.00% (Libor + 4.50%/M)    

12/21/2018

    16.3     15.8 (2)(14)      

                      27.1     26.3        

                                     

Commercial Credit Group, Inc.

  Commercial equipment finance and leasing company   Senior subordinated loan ($28.0 par due 8/2022)   12.24% (Libor + 9.75%/M)    

5/10/2012

    28.0     28.0 (2)(14)      

                                     

DFC Global Facility Borrower II LLC(8)(18)

  Non-bank provider of alternative financial services   First lien senior secured revolving loan ($94.6 par due 9/2022)   13.24%
(Libor + 10.75%/M)
   

9/27/2017

    94.6     94.6 (2)(14)      

                                     

Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.(6)

  Debt collection services provider   Common stock (180 shares)        

1/11/2017

        (2)      

                                     

Gordian Group, LLC

  Provider of products, services and software to organizations pursuing efficient and effective procurement and information solutions   Common stock (526 shares)        

11/30/2012

        (2)      

                                     

Ivy Hill Asset Management, L.P.(7)(8)

  Asset management services   Member interest (100.00% interest)        

6/15/2009

    444.0     534.0        

                                     

Javlin Three LLC, Javlin Four LLC, and Javlin Five LLC(8)

  Asset-backed financial services company   First lien senior secured loan ($16.0 par due 6/2017)        

6/24/2014

    14.2     8.5 (2)(13)      

                                     

Joyce Lane Capital LLC and Joyce Lane Financing SPV LLC (fka Ciena Capital LLC)(7)(8)(18)

  Specialty finance company   First lien senior secured loan ($0.8 par due 12/2022)   6.60% (Libor + 4.00%/Q)    

12/27/2018

    0.8     0.8 (2)      

      Equity interests        

11/29/2010

    12.7     2.9 (2)      

                      13.5     3.7        

                                     

F-165


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

LS DE LLC and LM LSQ Investors LLC(8)

  Asset based lender   Senior subordinated loan ($3.0 par due 6/2021)   10.50%    

6/15/2017

    3.0     3.0 (2)      

      Senior subordinated loan ($37.0 par due 3/2024)   10.50%    

6/25/2015

    37.0     37.0 (2)      

      Membership units (3,275,000 units)        

6/25/2015

    3.3     5.0        

                      43.3     45.0        

                                     

NM GRC HOLDCO, LLC(18)

  Regulatory compliance services provider to financial institutions   First lien senior secured loan ($19.2 par due 2/2024)   8.60% (Libor + 6.00%/Q)    

2/9/2018

    19.2     19.2 (2)(14)      

      First lien senior secured loan ($41.0 par due 2/2024)   8.60% (Libor + 6.00%/Q)    

2/9/2018

    40.7     41.0 (2)(14)      

                      59.9     60.2        

                                     

Rialto Management Group, LLC(8)(18)

  Investment and asset management platform focused on real estate   First lien senior secured loan ($1.0 par due 12/2024)   7.00% (Libor + 4.50%/M)    

11/30/2018

    1.0     1.0 (2)(14)      

                                     

The Ultimus Group Midco, LLC, The Ultimus Group, LLC, and The Ultimus Group Aggregator, LP(18)

  Provider of asset-servicing capabilities for fund managers   First lien senior secured loan ($15.7 par due 2/2026)   6.74% (Libor + 4.25%/M)    

2/1/2019

    15.7     15.6 (2)(14)      

      First lien senior secured loan ($15.7 par due 2/2026)   6.74% (Libor + 4.25%/M)    

2/1/2019

    15.7     15.5 (2)(14)      

      Class A units (245 units)        

2/1/2019

    0.2     0.2 (2)      

      Class B units (245,194 units)        

2/1/2019

        (2)      

      Class A units (1,102 units)        

2/1/2019

    1.1     1.1 (2)      

      Class B units (1,825,805 units)        

2/1/2019

        (2)      

                      32.7     32.4        

                                     

Vela Trading Technologies, LLC(18)

  Provider of market data software and content to global financial services clients   First lien senior secured revolving loan ($0.5 par due 6/2022)   7.69% (Libor + 5.00%/Q)    

2/8/2018

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($4.9 par due 6/2022)   7.78% (Libor + 5.00%/Q)    

4/17/2018

    4.9     4.8 (2)(14)      

                      5.4     5.3        

                      763.7     839.0     11.43 %

Other Services

               

 

                   

                                     

1A Smart Start, LLC(18)

  Provider of ignition interlock devices   First lien senior secured revolving loan ($0.9 par due 8/2020)   7.00% (Libor + 4.50%/M)    

2/8/2018

    0.9     0.9 (2)(17)      

                                     

AMCP Clean Intermediate, LLC(18)

  Provider of janitorial and facilities management services   First lien senior secured revolving loan      

10/1/2018

        (16)      

      First lien senior secured loan ($13.8 par due 10/2024)   8.29% (Libor + 5.50%/Q)    

1/4/2019

    13.8     13.7 (2)(14)      

                      13.8     13.7        

                                     

American Residential Services L.L.C.

  Heating, ventilation and air conditioning services provider   Second lien senior secured loan ($70.8 par due 12/2022)   10.50% (Libor + 8.00%/M)    

6/30/2014

    70.5     69.3 (2)(14)      

                                     

Capstone Logistics Acquisition, Inc.(18)

  Outsourced supply chain solutions provider to operators of distribution centers   First lien senior secured revolving loan      

2/8/2018

        (16)      

                                     

F-166


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC(6)(18)

  Provider of outsourced healthcare linen management solutions   First lien senior secured revolving loan      

3/13/2014

        (16)      

      First lien senior secured loan ($11.8 par due 12/2021)   8.75% (Libor + 6.25%/M)    

4/6/2017

    11.8     11.8 (2)(14)      

      First lien senior secured loan ($11.9 par due 12/2021)   8.75% (Libor + 6.25%/M)    

6/12/2018

    11.9     11.9 (2)(14)      

      First lien senior secured loan ($10.1 par due 12/2021)   8.75% (Libor + 6.25%/M)    

3/13/2014

    10.1     10.1 (3)(14)      

      First lien senior secured loan ($11.0 par due 12/2021)   8.75% (Libor + 6.25%/M)    

3/13/2014

    11.0     11.0 (2)(14)      

      Class A preferred units (3,393,973 units)        

3/13/2014

    4.0     3.4 (2)      

      Class B common units (377,108 units)        

3/13/2014

    0.4     1.3 (2)      

                      49.2     49.5        

                                     

IMIA Holdings, Inc.(18)

  Marine preservation maintenance company   First lien senior secured revolving loan      

10/26/2018

        (16)      

      First lien senior secured loan ($2.8 par due 10/2024)   7.10% (Libor + 4.50%/Q)    

10/26/2018

    2.8     2.8 (2)(14)      

      First lien senior secured loan ($18.0 par due 10/2024)   7.10% (Libor + 4.50%/Q)    

10/26/2018

    17.9     18.0 (3)(14)      

                      20.7     20.8        

                                     

Magento, Inc.(18)

  eCommerce platform provider for the retail industry   First lien senior secured revolving loan      

2/8/2018

        (16)      

                                     

F-167


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Massage Envy, LLC and ME Equity LLC(18)

  Franchisor in the massage industry   First lien senior secured loan ($0.5 par due 12/2024)   9.24% (Libor + 6.75%/M)    

1/24/2018

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($1.0 par due 12/2024)   9.24% (Libor + 6.75%/M)    

1/24/2018

    1.0     1.0 (2)(14)      

      First lien senior secured loan ($0.3 par due 12/2024)   9.24% (Libor + 6.75%/M)    

1/24/2018

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($1.7 par due 12/2024)   9.25% (Libor + 6.75%/M)    

1/24/2018

    1.7     1.7 (2)(14)      

      First lien senior secured loan ($0.4 par due 12/2024)   9.31% (Libor + 6.75%/Q)    

1/24/2018

    0.4     0.4 (2)(14)      

      First lien senior secured loan ($1.5 par due 12/2024)   9.31% (Libor + 6.75%/Q)    

1/24/2018

    1.5     1.5 (2)(14)      

      First lien senior secured loan ($2.4 par due 7/2020)   9.55% (Libor + 6.75%/Q)    

7/20/2018

    2.4     2.4 (2)(14)      

      First lien senior secured loan ($0.4 par due 7/2020)   9.25% (Libor + 6.75%/M)    

7/20/2018

    0.4     0.4 (2)(14)      

      First lien senior secured loan ($0.9 par due 7/2020)   9.23% (Libor + 6.75%/M)    

7/20/2018

    0.9     0.9 (2)(14)      

      First lien senior secured loan ($0.2 par due 7/2020)   9.31% (Libor + 6.75%/Q)    

7/20/2018

    0.2     0.2 (2)(14)      

      First lien senior secured loan ($0.6 par due 9/2020)   9.24% (Libor + 6.75%/M)    

7/27/2017

    0.6     0.6 (2)(14)      

      First lien senior secured loan ($0.5 par due 9/2020)   9.24% (Libor + 6.75%/M)    

7/27/2017

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($0.3 par due 9/2020)   9.31% (Libor + 6.75%/Q)    

7/27/2017

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($0.3 par due 9/2020)   9.24% (Libor + 6.75%/M)    

4/12/2017

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($0.1 par due 9/2020)   9.31% (Libor + 6.75%/Q)    

4/12/2017

    0.1     0.1 (2)(14)      

      First lien senior secured loan ($1.0 par due 9/2020)   9.23% (Libor + 6.75%/M)    

4/12/2017

    1.0     1.0 (2)(14)      

      First lien senior secured loan ($38.0 par due 9/2020)   9.31% (Base Rate + 5.50%/Q)    

9/27/2012

    38.0     38.0 (3)(14)      

      First lien senior secured loan ($18.5 par due 9/2020)   9.31% (Base Rate + 5.50%/Q)    

9/27/2012

    18.5     18.5 (4)(14)      

      Common stock (3,000,000 shares)        

9/27/2012

    3.0     6.3 (2)      

                      71.6     74.9        

                                     

Mckenzie Sports Products, LLC(18)

  Designer, manufacturer and distributor of hunting-related supplies   First lien senior secured revolving loan ($0.9 par due 9/2020)   6.25% (Libor + 3.75%/M)    

9/18/2014

    0.9     0.9 (2)(14)      

      First lien senior secured revolving loan ($0.5 par due 9/2020)   10.25% (Base Rate + 4.75%/Q)    

9/18/2014

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($1.5 par due 9/2020)   8.25% (Libor + 5.75%/M)    

9/18/2014

    1.5     1.5 (3)(10)(14)      

      First lien senior secured loan ($4.0 par due 9/2020)   8.25% (Libor + 5.75%/M)    

9/18/2014

    4.0     4.0 (3)(10)(14)      

      First lien senior secured loan ($84.5 par due 9/2020)   8.25% (Libor + 5.75%/M)    

9/18/2014

    84.5     84.5 (3)(10)(14)      

                      91.4     91.4        

                                     

F-168


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

MSHC, Inc.(18)

  Heating, ventilation and air conditioning services provider   First lien senior secured revolving loan ($1.1 par due 7/2022)   6.74% (Libor + 4.25%/M)    

7/31/2017

    1.1     1.1 (2)(14)      

      First lien senior secured revolving loan ($0.6 par due 7/2022)   8.75% (Base Rate + 3.25%/Q)    

7/31/2017

    0.6     0.6 (2)(14)      

      First lien senior secured loan ($0.3 par due 7/2023)   7.03% (Libor + 4.25%/Q)    

7/31/2017

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($0.2 par due 7/2023)   6.85% (Libor + 4.25%/Q)    

6/27/2018

    0.2     0.2 (2)(14)      

      First lien senior secured loan ($0.9 par due 7/2023)   6.85% (Libor + 4.25%/Q)    

11/20/2018

    0.9     0.9 (2)(14)      

      Second lien senior secured loan ($2.8 par due 12/2025)   10.85% (Libor + 8.25%/Q)    

11/20/2018

    2.8     2.8 (2)(14)      

      Second lien senior secured loan ($5.9 par due 12/2025)   11.03% (Libor + 8.25%/Q)    

6/27/2018

    5.9     5.9 (2)(14)      

      Second lien senior secured loan ($7.9 par due 12/2025)   10.99% (Libor + 8.25%/Q)    

6/27/2018

    7.9     7.9 (2)(14)      

      Second lien senior secured loan ($9.8 par due 12/2025)   10.88% (Libor + 8.25%/Q)    

6/27/2018

    9.8     9.8 (2)(14)      

      Second lien senior secured loan ($2.7 par due 12/2025)   10.85% (Libor + 8.25%/Q)    

6/27/2018

    2.7     2.7 (2)(14)      

      Second lien senior secured loan ($4.8 par due 12/2025)   10.85% (Libor + 8.25%/Q)    

7/31/2017

    4.8     4.8 (2)(14)      

      Second lien senior secured loan ($46.0 par due 12/2025)   10.85% (Libor + 8.25%/Q)    

7/31/2017

    46.0     46.0 (2)(14)      

                      83.0     83.0        

                                     

Research Now Group, LLC and Survey Sampling International, LLC

  Provider of outsourced data collection to the market research industry   First lien senior secured loan ($57.4 par due 12/2024)   8.00% (Libor + 5.50%/M)    

2/14/2019

    56.5     56.8 (2)(14)      

                                     

SecurAmerica, LLC, ERMC LLC, ERMC Of America, LLC, SecurAmerica Corporation, ERMC Aviation LLC, American Security Programs, Inc., USI LLC and Argenbright Holdings IV, LLC(18)

  Provider of outsourced manned security guard services, outsourced facilities management and outsourced aviation services   First lien senior secured loan ($2.2 par due 12/2023)   9.25% (Libor + 6.75%/M)    

12/21/2018

    2.2     2.2 (2)(14)      

      First lien senior secured loan ($26.0 par due 12/2023)   9.24% (Libor + 6.75%/M)    

12/21/2018

    26.0     25.8 (2)(14)      

                      28.2     28.0        

                                     

Siteworx Holdings, LLC & Siteworx LLC(18)

  Provider of design, web content management, eCommerce solutions and system integration   First lien senior secured revolving loan ($0.7 par due 1/2020)   6.75% (Base Rate + 1.25%/M)    

2/16/2018

    0.7     0.7 (14)      

      First lien senior secured revolving loan ($0.7 par due 1/2020)   6.75% (Base Rate + 1.25%/M)    

2/16/2018

    0.7     0.7 (12)(14)      

      First lien senior secured loan ($0.9 par due 1/2020)   5.50%    

2/16/2018

    0.9     0.9        

      First lien senior secured loan ($0.9 par due 1/2020)   5.50%    

2/16/2018

    0.9     0.9 (12)      

                      3.2     3.2        

                                     

SocialFlow, Inc.

  Social media optimization platform provider   Warrant to purchase up to 215,331 shares of Series C preferred stock (expires 1/2026)        

1/13/2016

        (2)      

                                     

SoundCloud Limited(8)

  Platform for receiving, sending, and distributing music   Common stock (73,422 shares)        

8/15/2017

    0.4     0.7 (2)      

                                     

F-169


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Spin HoldCo Inc.

  Laundry service and equipment provider   Second lien senior secured loan ($154.2 par due 5/2023)   10.14% (Libor + 7.50%/Q)    

5/14/2013

    154.2     152.6 (2)(14)      

                                     

TDG Group Holding Company and TDG Co-Invest, LP(18)

  Operator of multiple franchise concepts primarily related to home maintenance or repairs   First lien senior secured revolving loan ($0.0 par due 5/2024)   8.00% (Libor + 5.50%/Q)    

5/31/2018

        (2)(14)(17)      

      First lien senior secured loan ($6.1 par due 5/2024)   8.10% (Libor + 5.50%/Q)    

8/24/2018

    6.1     6.1 (2)(14)      

      First lien senior secured loan ($9.3 par due 5/2024)   8.10% (Libor + 5.50%/Q)    

5/31/2018

    9.3     9.3 (3)(14)      

      Preferred units (2,871,000 units)        

5/31/2018

    2.9     3.1 (2)      

      Common units (29,000 units)        

5/31/2018

        0.2 (2)      

                      18.3     18.7        

                                     

Tyden Group Holding Corp.(8)

  Producer and marketer of global cargo security, product identification and traceability products and utility meter products   Preferred stock (46,276 shares)        

1/3/2017

    0.4     0.4        

      Common stock (5,521,203 shares)        

1/3/2017

    2.0     5.3        

                      2.4     5.7        

                                     

VLS Recovery Services, LLC(18)

  Provider of commercial and industrial waste processing and disposal services   First lien senior secured revolving loan ($0.5 par due 10/2023)   8.48% (Libor + 6.00%/M)    

10/17/2017

    0.5     0.5 (2)(14)(17)      

      First lien senior secured revolving loan ($1.1 par due 10/2023)   8.48% (Libor + 6.00%/M)    

10/17/2017

    1.1     1.1 (2)(14)(17)      

      First lien senior secured revolving loan ($0.5 par due 10/2023)   8.49% (Libor + 6.00%/M)    

10/17/2017

    0.5     0.5 (2)(14)(17)      

      First lien senior secured revolving loan ($1.1 par due 10/2023)   8.49% (Libor + 6.00%/M)    

10/17/2017

    1.1     1.1 (2)(14)(17)      

      First lien senior secured revolving loan ($0.5 par due 10/2023)   8.49% (Libor + 6.00%/M)    

10/17/2017

    0.5     0.5 (2)(14)(17)      

                      3.7     3.7        

                                     

WASH Multifamily Acquisition Inc. and Coinamatic Canada Inc.

  Laundry service and equipment provider   Second lien senior secured loan ($3.7 par due 5/2023)   9.50% (Libor + 7.00%/M)    

5/14/2015

    3.7     3.6 (2)(14)      

      Second lien senior secured loan ($21.3 par due 5/2023)   9.50% (Libor + 7.00%/M)    

5/14/2015

    21.1     20.6 (2)(14)      

                      24.8     24.2        

                      692.8     697.1     9.50 %

Manufacturing

               

 

                   

                                     

Chariot Acquisition, LLC(18)

  Aftermarket golf cart parts and accessories   First lien senior secured loan ($18.1 par due 9/2021)   9.10% (Libor + 6.50%/Q)    

1/3/2017

    18.0     18.0 (3)(14)      

      First lien senior secured loan ($9.2 par due 9/2021)   9.10% (Libor + 6.50%/Q)    

1/3/2017

    9.2     9.1 (4)(14)      

                      27.2     27.1        

                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

ECI Purchaser Company, LLC

  Equipment to safely control pressurized gases   First lien senior secured loan ($21.8 par due 12/2019)   9.13% (Libor + 6.25%/S)    

7/26/2017

    21.8     21.5 (2)(14)      

      First lien senior secured loan ($88.7 par due 12/2019)   9.15% (Libor + 6.25%/S)    

7/26/2017

    88.7     87.8 (2)(14)      

      First lien senior secured loan ($74.8 par due 12/2019)   9.15% (Libor + 6.25%/S)    

7/26/2017

    74.8     74.0 (3)(14)      

      First lien senior secured loan ($0.3 par due 12/2019)   9.13% (Libor + 6.25%/S)    

7/26/2017

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($0.2 par due 12/2019)   9.13% (Libor + 6.25%/S)    

7/26/2017

    0.2     0.2 (3)(14)      

                      185.8     183.8        

                                     

Harvey Tool Company, LLC(18)

  Cutting tool provider to the metalworking industry   First lien senior secured revolving loan ($0.4 par due 10/2023)   7.00% (Libor + 4.50%/M)    

10/12/2017

    0.4     0.4 (2)(14)(17)      

      First lien senior secured loan ($4.9 par due 10/2024)   7.62% (Libor + 4.75%/S)    

10/12/2017

    4.9     4.9 (2)(14)      

      First lien senior secured loan ($30.6 par due 10/2024)   7.35% (Libor + 4.75%/Q)    

10/12/2017

    30.6     30.6 (4)(14)      

      Second lien senior secured loan ($43.7 par due 10/2025)   11.30% (Libor + 8.50%/Q)    

10/12/2017

    43.7     43.7 (2)(14)      

                      79.6     79.6        

                                     

Ioxus, Inc.(6)

  Energy storage devices   First lien senior secured loan ($1.4 par due 12/2019)        

4/29/2014

    1.3     1.4 (2)      

      First lien senior secured loan ($5.7 par due 12/2019)   9.00% Cash, 3.00% PIK    

4/29/2014

    5.7     5.7 (2)      

      Series CC preferred stock (1,683,265 shares)        

9/7/2017

    0.7     (2)      

      Warrant to purchase up to 30,256 shares of Series BB preferred stock (expires 8/2026)        

8/24/2016

        (2)      

      Warrant to purchase up to 8,416,326 shares of Series CC preferred stock (expires 1/2027)        

1/27/2017

        (2)      

      Warrant to purchase up to 75,968 shares of common stock (expires 1/2026)        

1/28/2016

        (2)      

                      7.7     7.1        

                                     

KPS Global LLC and Cool Group LLC

  Walk-in cooler and freezer systems   First lien senior secured loan ($1.6 par due 4/2022)   5.11% (Libor + 2.63%/M)    

4/5/2017

    1.6     1.6 (2)(14)      

      First lien senior secured loan ($4.3 par due 4/2022)   9.67% (Libor + 7.19%/M)    

11/16/2018

    4.3     4.3 (2)(14)      

      First lien senior secured loan ($10.5 par due 4/2022)   9.62% (Libor + 7.14%/M)    

4/5/2017

    10.5     10.5 (2)(14)      

      First lien senior secured loan ($5.2 par due 4/2022)   9.62% (Libor + 7.14%/M)    

4/5/2017

    5.2     5.2 (4)(14)      

      Class A units (13,292 units)        

9/21/2018

    1.1     1.5        

                      22.7     23.1        

                                     

Mac Lean-Fogg Company and MacLean-Fogg Holdings, L.L.C.(18)

  Manufacturer and supplier for the power utility and automotive markets worldwide   First lien senior secured loan ($12.6 par due 12/2025)   7.24% (Libor + 4.75%/M)    

12/21/2018

    12.6     12.5 (2)(14)      

      First lien senior secured loan ($166.7 par due 12/2025)   7.25% (Libor + 4.75%/M)    

12/21/2018

    165.9     165.0 (2)(14)      

      First lien senior secured loan ($12.5 par due 12/2025)   7.25% (Libor + 4.75%/M)    

12/21/2018

    12.4     12.4 (2)(14)      

      Preferred units (70,183 units)   4.50% Cash, 9.25% PIK    

10/9/2015

    79.9     81.0        

                      270.8     270.9        

F-171


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Nordco Inc.(18)

  Railroad maintenance-of-way machinery   First lien senior secured revolving loan ($2.6 par due 8/2020)   11.00% (Base Rate + 5.50%/Q)    

8/26/2015

    2.6     2.5 (2)(14)(17)      

                                     

Pelican Products, Inc.

  Flashlights   Second lien senior secured loan ($27.3 par due 5/2026)   10.23% (Libor + 7.75%/M)    

5/4/2018

    27.1     27.3 (2)(14)      

                                     

Sanders Industries Holdings, Inc. and SI Holdings, Inc.(18)

  Elastomeric parts, mid-sized composite structures, and composite tooling   First lien senior secured loan ($40.2 par due 5/2020)   9.30% (Libor + 6.50%/Q)    

7/21/2017

    40.2     40.2 (2)(14)      

      First lien senior secured loan ($23.1 par due 5/2020)   9.30% (Libor + 6.50%/Q)    

7/21/2017

    23.1     23.1 (4)(14)      

      Common stock (1,500 shares)        

5/30/2014

    1.5     2.1 (2)      

                      64.8     65.4        

                                     

Saw Mill PCG Partners LLC

  Metal precision engineered components   Common units (1,000 units)        

1/30/2007

    1.0     (2)      

                                     

Sonny's Enterprises, LLC(18)

  Car wash equipment, parts and supplies to the conveyorized car wash market   First lien senior secured revolving loan ($0.5 par due 12/2022)   6.75% (Libor + 4.25%/M)    

11/30/2017

    0.5     0.5 (2)(14)      

      First lien senior secured revolving loan ($1.2 par due 12/2022)   6.75%
(Libor + 4.25%/M)
   

11/30/2017

    1.2     1.2 (2)(14)      

                      1.7     1.7        

                                     

Sunk Rock Foundry Partners LP, Hatteras Electrical Manufacturing Holding Company and Sigma Electric Manufacturing Corporation(18)

  Metal castings, precision machined components and sub-assemblies in the electrical products, power transmission and distribution and general industrial markets   First lien senior secured revolving loan ($2.4 par due 10/2022)   7.35%
(Libor + 4.75%/Q)
   

10/31/2017

    2.4     2.4 (2)(14)(17)      

      First lien senior secured loan ($1.6 par due 10/2023)   7.35%
(Libor + 4.75%/Q)
   

10/31/2017

    1.6     1.6 (2)(14)      

      First lien senior secured loan ($1.7 par due 10/2023)   7.35% (Libor + 4.75%/Q)    

10/31/2017

    1.7     1.7 (2)(14)      

                      5.7     5.7        

                      696.7     694.2     9.46 %

                                     

Power Generation

               

 

                   

                                     

Alphabet Energy, Inc.

  Technology developer to convert waste-heat into electricity   First lien senior secured loan ($3.4 par due 8/2017)        

12/16/2013

    2.8     (2)(13)      

      First lien senior secured loan ($0.1 par due 8/2017)        

12/16/2013

    0.1     (2)(13)      

      Series 1B preferred stock (12,976 shares)        

6/21/2016

    0.2     (2)      

      Warrant to purchase up to 125,000 shares of Series 2 preferred stock (expires 12/2023)        

6/30/2016

    0.1     (2)      

                      3.2            

                                     

Apex Clean Energy Holdings, LLC(18)

  Developer, builder and owner of utility-scale wind and solar power facilities   First lien senior secured revolving loan      

12/12/2018

        (16)      

      First lien senior secured loan ($94.7 par due 9/2022)   9.35%
(Libor + 6.75%/Q)
   

9/24/2018

    94.7     94.7 (2)(14)      

                      94.7     94.7        

                                     

Beacon RNG LLC

  Owner of natural gas facilities   Class B units (35,000,000 units)        

3/11/2019

    35.0     35.0 (2)      

                                     

F-172


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

CPV Maryland Holding Company II, LLC

  Gas turbine power generation facilities operator   Senior subordinated loan ($52.9 par due 12/2020)   12.00% PIK    

8/8/2014

    52.9     49.5 (2)      

                                     

DGH Borrower LLC(18)

  Developer, owner and operator of quick start, small-scale natural gas-fired power generation projects   First lien senior secured loan ($52.3 par due 6/2023)   9.10% (Libor + 6.50%/Q)    

6/8/2018

    52.3     52.3 (2)(14)      

                                     

Green Energy Partners, Stonewall LLC and Panda Stonewall Intermediate Holdings II LLC

  Gas turbine power generation facilities operator   First lien senior secured loan ($24.6 par due 11/2021)   8.10% (Libor + 5.50%/Q)    

11/13/2014

    24.5     24.6 (2)(14)      

      Senior subordinated loan ($21.2 par due 12/2021)   13.25%    

11/13/2014

    21.2     20.6 (2)      

      Senior subordinated loan ($99.0 par due 12/2021)   13.25%    

11/13/2014

    99.0     96.5 (2)      

                      144.7     141.7        

                                     

Joule Unlimited Technologies, Inc. and Stichting Joule Global Foundation

  Renewable fuel and chemical production developer   First lien senior secured loan ($0.1 par due 10/2018)        

3/31/2015

    0.1     (2)(13)      

      First lien senior secured loan ($7.7 par due 10/2018)        

3/31/2015

    5.8     (2)(13)      

      Warrant to purchase up to 32,051 shares of Series C-2 preferred stock (expires 7/2023)        

7/25/2013

        (2)(8)      

                      5.9            

                                     

Moxie Patriot LLC

  Gas turbine power generation facilities operator   First lien senior secured loan ($32.4 par due 12/2020)   8.55%
(Libor + 5.75%/Q)
   

12/19/2013

    32.3     31.5 (2)(14)      

                                     

Navisun LLC and Navisun Holdings LLC(7)(18)

  Owner and operater of commercial and industrial solar projects   First lien senior secured loan ($43.9 par due 11/2023)   8.00% PIK    

11/15/2017

    43.9     43.9 (2)      

      Series A preferred units (1,000 units)   10.50% PIK    

11/15/2017

    5.0     5.0 (2)      

      Class A units (550 units)        

11/15/2017

        0.2        

                      48.9     49.1        

                                     

Panda Liberty LLC (fka Moxie Liberty LLC)

  Gas turbine power generation facilities operator   First lien senior secured loan ($49.5 par due 8/2020)   9.10% (Libor + 6.50%/Q)    

4/6/2018

    47.3     42.8 (2)(14)      

      First lien senior secured loan ($33.9 par due 8/2020)   9.30% (Libor + 6.50%/Q)    

8/21/2013

    33.8     29.3 (2)(14)      

                      81.1     72.1        

                                     

Panda Temple Power, LLC and T1 Power Holdings LLC(6)

  Gas turbine power generation facilities operator   Second lien senior secured loan ($9.2 par due 2/2023)   10.48% PIK (Libor + 8.00%/Q)    

3/6/2015

    9.2     9.2 (2)(14)      

      Class A Common units (616,122 shares)        

3/6/2015

    15.0     12.3 (2)      

                      24.2     21.5        

                                     

PERC Holdings 1 LLC

  Operator of recycled energy, combined heat and power, and energy efficiency facilities   Class B common units (21,653,543 units)        

10/20/2014

    8.8     21.8 (2)      

                                     

Riverview Power LLC

  Operator of natural gas and oil fired power generation facilities   First lien senior secured loan ($81.2 par due 12/2022)   10.60% (Libor + 8.00%/Q)    

12/29/2016

    79.6     81.2 (2)(14)      

                      663.6     650.4     8.86 %

                                     

F-173


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Automotive Services

               

 

                   

                                     

A.U.L. Corp.(18)

  Provider of vehicle service contracts and limited warranties for passenger vehicles   First lien senior secured loan ($7.0 par due 6/2023)   7.00% (Libor + 4.50%/M)    

6/7/2017

    7.0     7.0 (2)(14)      

                                     

AEP Holdings, Inc. and Arrowhead Holdco Company

  Distributor of non-discretionary, mission-critical aftermarket replacement parts   First lien senior secured loan ($0.1 par due 8/2021)   8.62% (EURIBOR + 6.00%/Q)    

6/28/2018

    0.1     0.1 (2)(14)      

      First lien senior secured loan ($26.7 par due 8/2021)   8.74% (EURIBOR + 6.00%/Q)    

6/28/2018

    27.2     25.4 (2)(14)      

      Common stock (3,467 shares)        

8/31/2015

    3.5     2.0 (2)      

                      30.8     27.5        

                                     

ChargePoint, Inc.

  Developer and operator of electric vehicle charging stations   Warrant to purchase up to 809,126 shares of Series E preferred stock (expires 12/2024)        

12/30/2014

    0.3     3.0 (2)      

                                     

Dent Wizard International Corporation and DWH Equity Investors, L.P.

  Automotive reconditioning services   Second lien senior secured loan ($45.0 par due 10/2020)   10.50% (Libor + 8.00%/M)    

4/7/2015

    45.0     45.0 (3)(14)      

      Class A common stock (10,000 shares)        

4/7/2015

    0.2     0.7 (2)      

      Class B common stock (20,000 shares)        

4/7/2015

    0.4     1.5 (2)      

                      45.6     47.2        

                                     

Eckler Industries, Inc. and Eckler Purchaser LLC(7)(18)

  Restoration parts and accessories provider for classic automobiles   First lien senior secured revolving loan ($2.8 par due 5/2022)   12.00% PIK    

7/12/2012

    2.8     2.8 (2)      

      First lien senior secured loan ($18.8 par due 5/2022)   12.00% PIK    

7/12/2012

    18.6     18.8 (2)      

      Class A preferred units (67,972 units)        

7/12/2012

    15.9     0.6 (2)      

      Class A common units (67,972 units)        

7/12/2012

    0.5     (2)      

                      37.8     22.2        

                                     

ESCP PPG Holdings, LLC(6)

  Distributor of new equipment and aftermarket parts to the heavy-duty truck industry   Class A units (3,500,000 units)        

12/14/2016

    3.5     2.8 (2)      

                                     

GB Auto Service Holdings, LLC(18)

  Automotive parts and repair services retailer   First lien senior secured loan ($22.3 par due 10/2024)   8.49% (Libor + 6.00%/M)    

10/19/2018

    22.3     22.1 (3)(14)      

      Common units (3,700,000 units)        

10/19/2018

    4.6     4.6 (2)      

                      26.9     26.7        

                                     

Mavis Tire Express Services Corp. and Mavis Tire Express Services TopCo, L.P.(18)

  Auto parts retailer   Second lien senior secured loan ($0.7 par due 3/2026)   9.98% (Libor + 7.50%/M)    

3/20/2018

    0.7     0.7 (2)(14)      

      Second lien senior secured loan ($0.3 par due 3/2026)   9.98% (Libor + 7.50%/M)    

3/20/2018

    0.3     0.3 (2)(14)      

      Second lien senior secured loan ($0.3 par due 3/2026)   9.98% (Libor + 7.50%/M)    

3/20/2018

    0.3     0.3 (2)(14)      

      Second lien senior secured loan ($153.9 par due 3/2026)   9.98% (Libor + 7.50%/M)    

3/20/2018

    151.8     152.4 (2)(14)      

      Class A units (12,400,000 units)        

3/20/2018

    12.4     13.0 (2)      

                      165.5     166.7        

                                     

Simpson Performance Products, Inc.

  Provider of motorsports safety equipment   First lien senior secured loan ($28.3 par due 2/2020)   10.08% (Libor + 7.48%/Q)    

2/20/2015

    28.3     28.3 (3)(14)      

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

SK SPV IV, LLC

  Collision repair site operator   Series A common stock (12,500 units)        

8/18/2014

    0.6     2.1 (2)      

      Series B common stock (12,500 units)        

8/18/2014

    0.6     2.1 (2)      

                      1.2     4.2        

                                     

Wand Newco 3, Inc. (dba Caliber Collision)

  Collision repair company   Second lien senior secured loan ($180.2 par due 2/2027)   9.73% (Libor + 7.25%/M)    

2/5/2019

    177.1     178.4 (2)(14)      

                      524.0     514.0     7.00 %

                                     

Restaurants and Food Services

               

 

                   

                                     

ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.(7)(18)

  Restaurant owner and operator   First lien senior secured loan ($4.8 par due 12/2018)   20.61% PIK (Libor + 18.00%/Q)    

12/22/2016

    4.7     4.1 (2)(14)      

      First lien senior secured loan ($56.6 par due 12/2018)        

11/27/2006

    39.9     (2)(13)      

      Promissory note ($31.8 par due 12/2023)        

11/27/2006

    13.8     (2)      

      Warrant to purchase up to 0.95 units of Series D common stock (expires 12/2023)        

12/18/2013

        (2)      

                      58.4     4.1        

                                     

Cipriani USA, Inc.

  Manager and operator of banquet facilities, restaurants, hotels and other leisure properties   First lien senior secured loan ($3.0 par due 5/2023)   10.50% (Libor + 6.00% Cash, 2.00% PIK/Q)    

8/20/2018

    3.0     3.0 (2)(14)      

      First lien senior secured loan ($12.1 par due 5/2023)   10.50% (Libor + 6.00% Cash, 2.00% PIK/Q)    

11/5/2018

    12.1     12.1 (2)(14)      

      First lien senior secured loan ($3.0 par due 5/2023)   10.50% (Libor + 6.00% Cash, 2.00% PIK/Q)    

11/5/2018

    3.0     3.0 (2)(14)      

      First lien senior secured loan ($68.1 par due 5/2023)   10.50% (Libor + 6.00% Cash, 2.00% PIK/Q)    

5/30/2018

    68.1     68.1 (2)(14)      

                      86.2     86.2        

                                     

Cozzini Bros., Inc. and BH-Sharp Holdings LP(18)

  Provider of commercial knife sharpening and cutlery services in the restaurant industry   First lien senior secured revolving loan ($2.0 par due 3/2023)   8.06% (Libor + 5.50%/Q)    

3/10/2017

    2.0     2.0 (2)(14)      

      First lien senior secured revolving loan ($1.5 par due 3/2023)   10.00% (Base Rate + 4.50%/Q)    

3/10/2017

    1.5     1.5 (2)(14)      

      First lien senior secured loan ($11.6 par due 3/2023)   8.06% (Libor + 5.50%/Q)    

3/10/2017

    11.6     11.6 (4)(14)      

      Common units (2,950,000 units)        

3/10/2017

    3.0     3.7 (2)      

                      18.1     18.8        

                                     

FWR Holding Corporation(18)

  Restaurant owner, operator, and franchisor   First lien senior secured revolving loan ($0.5 par due 8/2023)   8.00% (Libor + 5.50%/M)    

8/21/2017

    0.5     0.5 (2)(14)(17)      

      First lien senior secured loan ($0.8 par due 8/2023)   8.00% (Libor + 5.50%/M)    

2/28/2019

    0.8     0.8 (2)(14)      

      First lien senior secured loan ($0.5 par due 8/2023)   7.99% (Libor + 5.50%/M)    

2/28/2019

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($0.5 par due 8/2023)   8.00% (Libor + 5.50%/M)    

8/21/2017

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($4.0 par due 8/2023)   8.00% (Libor + 5.50%/M)    

8/21/2017

    4.0     4.0 (2)(14)      

                      6.3     6.3        

                                     

F-175


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Garden Fresh Restaurant Corp. and GFRC Holdings LLC(18)

  Restaurant owner and operator   First lien senior secured revolving loan      

2/1/2017

        (16)      

      First lien senior secured loan ($23.4 par due 2/2022)   10.63% (Libor + 8.00%/Q)    

10/3/2013

    23.4     23.4 (2)(14)      

                      23.4     23.4        

                                     

Heritage Food Service Group, Inc. and WCI-HFG Holdings, LLC

  Distributor of repair and replacement parts for commercial kitchen equipment   Second lien senior secured loan ($31.6 par due 10/2022)   11.06% (Libor + 8.50%/Q)    

10/20/2015

    31.6     31.6 (2)(14)      

      Preferred units (3,000,000 units)   8.00% PIK    

10/20/2015

    3.0     4.6 (2)      

                      34.6     36.2        

                                     

Jim N Nicks Management, LLC(18)

  Restaurant owner and operator   First lien senior secured revolving loan ($2.8 par due 7/2023)   7.85% (Libor + 5.25%/Q)    

7/10/2017

    2.8     2.7 (2)(14)      

      First lien senior secured loan ($1.2 par due 7/2023)   7.85% (Libor + 5.25%/Q)    

7/10/2017

    1.2     1.1 (2)(14)      

      First lien senior secured loan ($13.9 par due 7/2023)   7.85% (Libor + 5.25%/Q)    

7/10/2017

    13.9     13.5 (4)(14)      

                      17.9     17.3        

                                     

Orion Foods, LLC(7)

  Convenience food service retailer   First lien senior secured loan ($1.2 par due 9/2015)        

4/1/2010

    1.2     0.4 (2)(13)      

      Second lien senior secured loan ($19.4 par due 9/2015)        

4/1/2010

        (2)(13)      

      Preferred units (10,000 units)        

10/28/2010

        (2)      

      Class A common units (25,001 units)        

4/1/2010

        (2)      

      Class B common units (1,122,452 units)        

4/1/2010

        (2)      

                      1.2     0.4        

                                     

F-176


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

OTG Management, LLC(18)

  Airport restaurant operator   First lien senior secured revolving loan ($1.6 par due 8/2021)   9.64% (Libor + 7.00%/Q)    

8/26/2016

    1.6     1.6 (2)(14)      

      First lien senior secured revolving loan ($8.4 par due 8/2021)   9.60% (Libor + 7.00%/Q)    

8/26/2016

    8.4     8.4 (2)(14)      

      First lien senior secured loan ($2.5 par due 8/2021)   9.69% (Libor + 7.00%/Q)    

8/26/2016

    2.5     2.5 (2)(14)      

      First lien senior secured loan ($1.6 par due 8/2021)   9.69% (Libor + 7.00%/Q)    

8/26/2016

    1.6     1.6 (2)(14)      

      First lien senior secured loan ($2.2 par due 8/2021)   9.74% (Libor + 7.00%/Q)    

8/26/2016

    2.2     2.2 (2)(14)      

      First lien senior secured loan ($2.2 par due 8/2021)   9.69% (Libor + 7.00%/Q)    

8/26/2016

    2.2     2.2 (2)(14)      

      First lien senior secured loan ($3.6 par due 8/2021)   9.60% (Libor + 7.00%/Q)    

8/26/2016

    3.6     3.6 (2)(14)      

      First lien senior secured loan ($2.6 par due 8/2021)   9.60% (Libor + 7.00%/Q)    

8/26/2016

    2.6     2.6 (2)(14)      

      First lien senior secured loan ($4.9 par due 8/2021)   9.74% (Libor + 7.00%/Q)    

8/26/2016

    4.9     4.9 (2)(14)      

      First lien senior secured loan ($0.6 par due 8/2021)   9.69% (Libor + 7.00%/Q)    

8/26/2016

    0.6     0.6 (2)(14)      

      First lien senior secured loan ($0.7 par due 8/2021)   9.60% (Libor + 7.00%/Q)    

8/26/2016

    0.7     0.7 (2)(14)      

      First lien senior secured loan ($1.8 par due 8/2021)   9.61% (Libor + 7.00%/Q)    

8/26/2016

    1.8     1.8 (2)(14)      

      First lien senior secured loan ($1.0 par due 8/2021)   9.60% (Libor + 7.00%/Q)    

8/26/2016

    1.0     1.0 (2)(14)      

      First lien senior secured loan ($0.3 par due 8/2021)   9.80% (Libor + 7.00%/Q)    

10/10/2018

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($0.7 par due 8/2021)   9.69% (Libor + 7.00%/Q)    

10/10/2018

    0.7     0.7 (2)(14)      

      First lien senior secured loan ($1.9 par due 8/2021)   9.60% (Libor + 7.00%/Q)    

10/10/2018

    1.9     1.9 (2)(14)      

      First lien senior secured loan ($0.7 par due 8/2021)   9.61% (Libor + 7.00%/Q)    

10/10/2018

    0.7     0.7 (2)(14)      

      First lien senior secured loan ($48.9 par due 8/2021)   9.74% (Libor + 7.00%/Q)    

8/26/2016

    48.9     48.9 (3)(14)      

      First lien senior secured loan ($48.9 par due 8/2021)   9.80% (Libor + 7.00%/Q)    

8/26/2016

    48.9     48.9 (3)(14)      

      Senior subordinated loan ($30.7 par due 2/2022)   13.00% PIK    

8/26/2016

    30.6     30.7 (2)      

      Class A preferred units (3,000,000 units)   14.50% PIK    

8/26/2016

    31.1     40.8 (2)      

      Common units (3,000,000 units)        

1/5/2011

    3.0     8.7 (2)      

      Warrant to purchase up to 7.73% of common units        

6/19/2008

    0.1     19.2 (2)      

                      199.9     234.5        

                                     

SFE Intermediate Holdco LLC(18)

  Provider of outsourced foodservice to K-12 school districts   First lien senior secured loan ($10.7 par due 7/2024)   7.35% (Libor + 4.75%/Q)    

9/5/2018

    10.7     10.7 (4)(14)      

      First lien senior secured loan ($6.7 par due 7/2024)   7.49% (Libor + 4.75%/Q)    

7/31/2017

    6.7     6.7 (4)(14)      

                      17.4     17.4        

                                     

Spectra Finance, LLC(18)

  Venue management and food and beverage provider   First lien senior secured revolving loan ($4.8 par due 4/2023)   6.49% (Libor + 4.00%/M)    

4/2/2018

    4.8     4.8 (2)(14)(17)      

      First lien senior secured loan ($19.0 par due 4/2024)   6.85% (Libor + 4.25%/Q)    

4/2/2018

    19.0     19.0 (2)(14)      

                      23.8     23.8        

                      487.2     468.4     6.38 %

F-177


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Food and Beverage

               

 

                   

                                     

American Seafoods Group LLC and American Seafoods Partners LLC

  Harvester and processor of seafood   Class A units (77,922 units)        

8/19/2015

    0.1     0.2 (2)      

      Warrant to purchase up to 7,422,078 Class A units (expires 8/2035)        

8/19/2015

    7.4     15.6 (2)      

                      7.5     15.8        

                                     

Bragg Live Food Products, LLC and SPC Investment Co., L.P.(6)(18)

  Health food company   First lien senior secured loan ($37.0 par due 3/2024)   8.35% (Libor + 5.75%/Q)    

3/11/2019

    37.0     36.6 (2)(14)      

      Common units (14,850 units)        

3/11/2019

    14.9     14.9 (2)      

                      51.9     51.5        

                                     

CHG PPC Parent LLC

  Diversified food products manufacturer   Second lien senior secured loan ($34.1 par due 3/2026)   10.25% (Libor + 7.75%/M)    

1/31/2019

    34.1     33.8 (2)(14)      

      Second lien senior secured loan ($60.5 par due 3/2026)   10.00% (Libor + 7.50%/M)    

3/30/2018

    60.5     59.6 (2)(14)      

                      94.6     93.4        

                                     

Edward Don & Company, LLC and VCP-EDC Co-Invest, LLC

  Distributor of foodservice equipment and supplies   Membership units (2,970,000 units)        

6/9/2017

    3.0     4.3        

                                     

Ferraro Fine Foods Corp. and Italian Fine Foods Holdings L.P.(18)

  Specialty Italian food distributor   First lien senior secured revolving loan ($0.3 par due 5/2023)   6.95% (Libor + 4.25%/Q)    

5/9/2018

    0.3     0.3 (2)(14)      

      First lien senior secured revolving loan ($0.5 par due 5/2023)   8.75% (Base Rate + 3.25%/Q)    

5/9/2018

    0.5     0.5 (2)(14)      

      First lien senior secured loan ($0.7 par due 5/2024)   6.85% (Libor + 4.25%/Q)    

12/7/2018

    0.7     0.7 (2)(14)      

      First lien senior secured loan ($9.4 par due 5/2024)   6.95% (Libor + 4.25%/Q)    

5/9/2018

    9.4     9.4 (4)(14)      

      Class A common units (2,724,000 units)        

5/9/2018

    2.7     3.5 (2)      

                      13.6     14.4        

                                     

FS Squared Holding Corp. and FS Squared, LLC(18)

  Provider of on-site vending and micro market solutions   First lien senior secured loan ($4.3 par due 3/2025)   9.75% (Base Rate + 4.25%/Q)    

3/28/2019

    4.3     4.3 (2)(14)      

      First lien senior secured loan ($0.1 par due 3/2025)   9.75% (Base Rate + 4.25%/Q)    

3/28/2019

    0.1     0.1 (2)(14)      

      Class A units (99,500 units)        

3/28/2019

    10.0     10.0 (2)      

                      14.4     14.4        

                                     

Gehl Foods, LLC and GF Parent LLC

  Producer of low-acid, aseptic food and beverage products   Class A preferred units (2,940 units)        

5/13/2015

    2.9     (2)      

      Class A common units (60,000 units)        

5/13/2015

    0.1     (2)      

      Class B common units (0.26 units)        

5/13/2015

        (2)      

                      3.0            

                                     

H-Food Holdings, LLC and Matterhorn Parent, LLC

  Food Contract Manufacturer   First lien senior secured loan ($20.2 par due 5/2025)   6.50% (Libor + 4.00%/M)    

11/25/2018

    20.0     19.6 (2)(14)      

      Second lien senior secured loan ($73.0 par due 3/2026)   9.50% (Libor + 7.00%/M)    

11/25/2018

    73.0     71.6 (2)(14)      

      Common units (5,827 units)        

11/25/2018

    5.8     5.8        

                      98.8     97.0        

                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Hometown Food Company(18)

  Food distributor   First lien senior secured revolving loan ($0.2 par due 8/2023)   7.75% (Libor + 5.25%/M)    

8/31/2018

    0.2     0.2 (2)(14)      

      First lien senior secured loan ($9.0 par due 8/2023)   7.75% (Libor + 5.25%/M)    

8/31/2018

    8.8     9.0 (2)(14)      

                      9.0     9.2        

                                     

JWC/KI Holdings, LLC

  Foodservice sales and marketing agency   Membership units (5,000 units)        

11/16/2015

    5.0     7.1 (2)      

                                     

KC Culinarte Intermediate, LLC

  Manufacturer of fresh refrigerated and frozen food products   Second lien senior secured loan ($35.7 par due 8/2026)   10.25% (Libor + 7.75%/M)    

8/24/2018

    35.7     35.3 (2)(14)      

                                     

NECCO Holdings, Inc. and New England Confectionery Company, Inc.(7)(18)

  Producer and supplier of candy   First lien senior secured revolving loan ($19.9 par due 1/2018)        

1/3/2017

    7.9     2.9 (13)      

      First lien senior secured loan ($2.2 par due 8/2018)        

11/20/2017

    2.1     (13)      

      First lien senior secured loan ($11.6 par due 1/2018)        

1/3/2017

    0.9     1.6 (13)      

      First lien senior secured loan ($0.7 par due 11/2018)        

11/20/2017

    0.7     0.1 (13)      

      Common stock (860,189 shares)        

1/3/2017

               

                      11.6     4.6        

                                     

RF HP SCF Investor, LLC(8)

  Branded specialty food company   Membership interest (10.08% interest)        

12/22/2016

    12.5     16.7 (2)      

                                     

Sovos Brands Intermediate, Inc.(18)

  Food and beverage platform   First lien senior secured loan ($10.0 par due 11/2025)   7.50% (Libor + 5.00%/M)    

11/20/2018

    9.9     9.9 (2)(14)      

      First lien senior secured loan ($6.9 par due 11/2025)   7.50% (Libor + 5.00%/M)    

11/20/2018

    6.8     6.8 (4)(14)      

                      16.7     16.7        

                                     

Teasdale Foods, Inc. and Familia Group Holdings Inc.(18)

  Provider of beans, sauces and hominy to the retail, foodservice and wholesale channels   First lien senior secured revolving loan ($0.1 par due 10/2020)   8.24% (Libor + 5.75%/M)    

6/30/2017

    0.1     0.1 (2)(14)      

      First lien senior secured revolving loan ($0.1 par due 10/2020)   8.24% (Libor + 5.75%/M)    

6/30/2017

    0.1     0.1 (2)(14)      

      First lien senior secured loan ($0.6 par due 10/2020)   8.55% (Libor + 5.25%/Q)    

6/26/2018

    0.6     0.6 (2)(14)      

      Second lien senior secured loan ($33.0 par due 10/2022)   12.56% PIK (Libor + 10.00%/Q)    

1/3/2017

    33.0     26.8 (2)(14)      

      Second lien senior secured loan ($22.4 par due 10/2022)   12.56% PIK (Libor + 10.00%/Q)    

1/3/2017

    22.4     18.1 (2)(14)      

      Second lien senior secured loan ($35.2 par due 10/2022)   12.56% PIK (Libor + 10.00%/Q)    

1/3/2017

    35.2     28.6 (2)(14)      

      Warrant to purchase up to 57,827 shares of common stock (expires 2/2034)        

2/4/2019

        (2)      

                      91.4     74.3        

                      468.7     454.7     6.20 %

F-179


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Oil and Gas

               

 

                   

                                     

Murchison Oil and Gas, LLC and Murchison Holdings, LLC(18)

  Exploration and production company   First lien senior secured loan ($5.0 par due 10/2023)   10.60% (Libor + 8.00%/Q)    

10/26/2018

    5.0     5.0 (2)(14)      

      First lien senior secured loan ($5.0 par due 10/2023)   10.60% (Libor + 8.00%/Q)    

10/26/2018

    5.0     5.0 (2)(14)      

      First lien senior secured loan ($5.0 par due 10/2023)   10.60% (Libor + 8.00%/Q)    

10/26/2018

    5.0     5.0 (2)(14)      

      First lien senior secured loan ($21.7 par due 10/2023)   10.60% (Libor + 8.00%/Q)    

10/26/2018

    21.2     21.5 (2)(14)      

      Preferred units (21,667 units)   8.00% PIK    

10/26/2018

    22.1     22.1        

                      58.3     58.6        

                                     

Penn Virginia Holding Corp.(8)

  Exploration and production company   Second lien senior secured loan ($90.1 par due 9/2022)   9.50% (Libor + 7.00%/M)    

9/28/2017

    90.1     90.1 (2)(14)      

                                     

Petroflow Energy Corporation and TexOak Petro Holdings LLC(6)

  Oil and gas exploration and production company   First lien senior secured loan ($2.4 par due 6/2019)        

6/29/2016

    0.4     (2)(13)      

      Second lien senior secured loan ($4.2 par due 12/2019)        

6/29/2016

    3.3     (2)(13)      

      Second lien senior secured loan ($23.0 par due 12/2019)        

6/29/2016

    18.6     (2)(13)      

      Common units (202,000 units)        

6/29/2016

    11.1            

                      33.4            

                                     

Sundance Energy, Inc.

  Oil and gas producer   Second lien senior secured loan ($60.7 par due 4/2023)   10.61% (Libor + 8.00%/Q)    

4/23/2018

    59.7     60.7 (2)(14)      

                                     

VPROP Operating, LLC and Vista Proppants and Logistics, LLC

  Sand-based proppant producer and distributor to the oil and natural gas industry   First lien senior secured loan ($28.1 par due 8/2021)   12.13% (Libor + 8.50% Cash, 1.00% PIK/Q)    

8/1/2017

    28.0     28.1 (2)(14)      

      First lien senior secured loan ($35.1 par due 8/2021)   12.13% (Libor + 8.50% Cash, 1.00% PIK/Q)    

11/9/2017

    35.1     35.1 (2)(14)      

      First lien senior secured loan ($15.1 par due 8/2021)   12.13% (Libor + 8.50% Cash, 1.00% PIK/Q)    

3/1/2017

    15.1     15.1 (2)(14)      

      First lien senior secured loan ($75.1 par due 8/2021)   12.13% (Libor + 8.50% Cash, 1.00% PIK/Q)    

3/1/2017

    75.1     75.1 (3)(14)      

      Common units (997,864 units)        

11/9/2017

    9.7     10.8 (2)      

                      163.0     164.2        

                      404.5     373.6     5.09 %

                                     

Wholesale Distribution

               

 

                   

                                     

Blue Angel Buyer 1, LLC and Blue Angel Holdco, LLC(6)(18)

  Distributor of OEM appliance aftermarket parts   First lien senior secured loan ($9.8 par due 1/2025)   7.06% (Libor + 4.25%/Q)    

1/2/2019

    9.8     9.7 (2)(14)      

      Class A preferred units (46,359 units)   8.00% PIK    

1/2/2019

    9.7     9.7 (2)      

                      19.5     19.4        

                                     

DFS Holding Company, Inc.

  Distributor of maintenance, repair, and operations parts, supplies, and equipment to the foodservice industry   First lien senior secured loan ($4.6 par due 3/2022)   8.25% (Libor + 5.75%/M)    

3/1/2017

    4.6     4.5 (2)(14)      

      First lien senior secured loan ($65.6 par due 2/2022)   8.25% (Libor + 5.75%/M)    

7/26/2017

    65.6     64.3 (2)(14)      

      First lien senior secured loan ($93.3 par due 2/2022)   8.25% (Libor + 5.75%/M)    

7/26/2017

    93.3     91.4 (3)(14)      

      First lien senior secured loan ($19.9 par due 2/2022)   8.25% (Libor + 5.75%/M)    

7/26/2017

    19.9     19.5 (4)(14)      

                      183.4     179.7        

                                     

F-180


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Flow Control Solutions, Inc.(18)

  Distributor and manufacturer of flow control systems components   First lien senior secured loan ($13.7 par due 11/2024)   7.85% (Libor + 5.25%/Q)    

11/21/2018

    13.7     13.6 (3)(14)      

                                     

KHC Holdings, Inc. and Kele Holdco, Inc.(18)

  Catalog-based distribution services provider for building automation systems   First lien senior secured revolving loan ($0.4 par due 10/2020)   6.75% (Libor + 4.25%/M)    

1/3/2017

    0.4     0.4 (2)(14)      

      First lien senior secured loan ($65.9 par due 10/2022)   8.60% (Libor + 6.00%/Q)    

1/3/2017

    65.9     65.9 (3)(14)      

      Common stock (30,000 shares)        

1/3/2017

    3.1     3.8        

                      69.4     70.1        

                                     

PetIQ, LLC

  Distributor and manufacturer of pet prescription medications and health products   First lien senior secured revolving loan ($17.8 par due 1/2023)   7.74% (Libor + 5.25%/M)    

1/17/2018

    17.8     17.8 (2)(14)      

                      303.8     300.6     4.10 %

                                     

Containers and Packaging

               

 

                   

                                     

GS Pretium Holdings, Inc.

  Manufacturer and supplier of high performance plastic containers   Common stock (500,000 shares)        

6/2/2014

    0.5     1.1 (2)      

                                     

IntraPac International LLC and IntraPac Canada Corporation(18)

  Manufacturer of diversified packaging solutions and plastic injection molded products   First lien senior secured revolving loan ($0.8 par due 1/2025)   8.06% (Libor + 5.50%/Q)    

1/11/2019

    0.8     0.8 (2)(14)      

      First lien senior secured revolving loan ($2.5 par due 1/2025)   8.20% (Libor + 5.50%/Q)    

1/11/2019

    2.5     2.5 (2)(14)      

      First lien senior secured loan ($23.0 par due 1/2026)   8.20% (Libor + 5.50%/M)    

1/11/2019

    23.0     22.8 (2)(8)(14)      

      First lien senior secured loan ($45.2 par due 1/2026)   8.20% (Libor + 5.50%/M)    

1/11/2019

    45.2     44.8 (2)(14)      

                      71.5     70.9        

                                     

LBP Intermediate Holdings LLC(18)

  Manufacturer of paper and corrugated foodservice packaging   First lien senior secured revolving loan      

7/10/2015

        (16)      

      First lien senior secured loan ($11.4 par due 7/2020)   8.10% (Libor + 5.50%/Q)    

11/13/2018

    11.3     11.4 (4)(14)      

      First lien senior secured loan ($11.8 par due 7/2020)   8.10% (Libor + 5.50%/Q)    

7/10/2015

    11.7     11.8 (3)(14)      

      First lien senior secured loan ($4.9 par due 7/2020)   8.10% (Libor + 5.50%/Q)    

7/10/2015

    4.9     4.9 (4)(14)      

                      27.9     28.1        

                                     

Microstar Logistics LLC, Microstar Global Asset Management LLC, and MStar Holding Corporation

  Keg management solutions provider   Second lien senior secured loan ($42.5 par due 8/2021)   10.00% (Libor + 7.50%/M)    

12/14/2012

    42.5     42.5 (2)(14)      

      Second lien senior secured loan ($75.0 par due 8/2021)   10.00% (Libor + 7.50%/M)    

12/14/2012

    75.0     75.0 (3)(14)      

      Second lien senior secured loan ($10.0 par due 8/2021)   10.00% (Libor + 7.50%/M)    

12/14/2012

    10.0     10.0 (4)(14)      

      Common stock (54,710 shares)        

12/14/2012

    4.9     8.2 (2)      

                      132.4     135.7        

                                     

Ranpak Corp.

  Manufacturer and marketer of paper-based protective packaging systems and materials   Second lien senior secured loan ($8.0 par due 10/2022)   9.73% (Libor + 7.25%/M)    

1/3/2017

    7.7     8.0 (2)(14)      

F-181


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

SCI PH Parent, Inc.

  Industrial container manufacturer, reconditioner and servicer   Series B shares (11.4764 shares)        

8/24/2018

    1.1     1.9 (2)      

                      241.1     245.7     3.35 %

                                     

Education

               

 

                   

                                     

Excelligence Holdings Corp.

  Developer, manufacturer and retailer of educational products   First lien senior secured loan ($9.3 par due 4/2023)   8.50% (Libor + 6.00%/M)    

4/17/2017

    9.3     7.8 (4)(14)      

                                     

Flinn Scientific, Inc. and WCI-Quantum Holdings, Inc.(18)

  Distributor of instructional products, services and resources   First lien senior secured loan ($20.8 par due 8/2023)   7.53% (Libor + 4.75%/Q)    

7/26/2017

    20.8     20.8 (2)(14)      

      First lien senior secured loan ($0.1 par due 8/2023)   7.35% (Libor + 4.75%/Q)    

7/26/2017

    0.1     0.1 (2)(14)      

      First lien senior secured loan ($25.4 par due 8/2023)   7.53% (Libor + 4.75%/S)    

7/26/2017

    25.4     25.4 (2)(14)      

      First lien senior secured loan ($1.2 par due 8/2023)   7.58% (Libor + 4.75%/A)    

8/31/2018

    1.2     1.2 (2)(14)      

      Series A preferred stock (1,272 shares)        

10/24/2014

    0.7     1.1 (2)      

                      48.2     48.6        

                                     

Frontline Technologies Group Holding LLC, Frontline Technologies Blocker Buyer, Inc., Frontline Technologies Holdings, LLC and Frontline Technologies Parent,  LLC(18)

  Provider of human capital management ("HCM") and SaaS-based software solutions to employees and administrators of K-12 school organizations   First lien senior secured loan ($1.9 par due 9/2023)   9.10% (Libor + 6.50%/Q)    

9/19/2017

    1.9     1.9 (2)(14)      

      Class A preferred units (4,574 units)   9.00% PIK    

9/18/2017

    4.7     5.7        

      Class B common units (499,050 units)        

9/18/2017

               

                      6.6     7.6        

                                     

Infilaw Holding, LLC(18)

  Operator of for-profit law schools   First lien senior secured revolving loan ($5.0 par due 2/2018)        

8/25/2011

    4.2     (2)(13)(17)      

                                     

Instituto de Banca y Comercio, Inc. & Leeds IV Advisors, Inc.

  Private school operator   First lien senior secured loan ($12.3 par due 10/2020)   11.74% (Libor + 9.00%/Q)    

10/31/2015

    12.3     12.3 (2)(14)      

      Senior preferred series A-1 shares (163,902 shares)        

10/31/2015

    119.4     18.8 (2)      

      Series B preferred stock (1,401,385 shares)        

8/5/2010

    4.0     (2)      

      Series B preferred stock (348,615 shares)        

8/5/2010

    1.0     (2)      

      Series C preferred stock (1,994,644 shares)        

6/7/2010

    0.5     (2)      

      Series C preferred stock (517,942 shares)        

6/7/2010

    0.1     (2)      

      Common stock (16 shares)        

6/7/2010

        (2)      

      Common stock (4 shares)        

6/7/2010

        (2)      

                      137.3     31.1        

                                     

Liaison Acquisition, LLC(18)

  Provider of centralized applications services to educational associations   Second lien senior secured loan ($3.3 par due 8/2023)   11.74% (Libor + 9.25%/M)    

2/9/2017

    3.2     3.3 (2)(14)      

                                     

PIH Corporation and Primrose Holding Corporation(6)(18)

  Franchisor of education-based early childhood centers   First lien senior secured revolving loan ($1.0 par due 12/2020)   8.00% (Libor + 5.50%/M)    

12/13/2013

    1.0     1.0 (2)(14)      

      Common stock (7,227 shares)        

1/3/2017

    10.7     22.7        

                      11.7     23.7        

                                     

F-182


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

R3 Education Inc., Equinox EIC Partners LLC and Sierra Education Finance Corp.

  Medical school operator   Common membership interest (15.76% interest)        

9/21/2007

    15.8     15.1 (2)      

      Warrant to purchase up to 27,890 shares (expires 11/2019)        

12/8/2009

        8.2 (2)      

                      15.8     23.3        

                                     

Raptor Technologies, LLC and Rocket Parent, LLC(18)

  Provider of SaaS-based safety and security software to the K-12 school market   First lien senior secured loan ($16.0 par due 12/2024)   8.60% (Libor + 6.00%/Q)    

12/17/2018

    16.0     15.9 (2)(14)      

      Class A common units (2,294,000 units)        

12/17/2018

    2.3     2.4        

                      18.3     18.3        

                                     

Regent Education, Inc.

  Provider of software solutions designed to optimize the financial aid and enrollment processes   Warrant to purchase up to 987 shares of common stock (expires 12/2026)        

12/23/2016

        (2)      

      Warrant to purchase up to 5,393,194 shares of common stock (expires 12/2026)        

12/23/2016

        (2)      

                                 

                                     

Severin Acquisition, LLC(18)

  Provider of student information system software solutions to the K-12 education market   First lien senior secured revolving loan ($0.4 par due 8/2023)   5.98% (Libor + 3.25%/Q)    

8/1/2018

    0.4     0.4 (2)(14)      

      First lien senior secured revolving loan ($0.8 par due 8/2023)   5.88% (Libor + 3.25%/Q)    

8/1/2018

    0.8     0.7 (2)(14)      

      First lien senior secured revolving loan ($0.8 par due 8/2023)   5.86% (Libor + 3.25%/Q)    

8/1/2018

    0.8     0.7 (2)(14)      

      Second lien senior secured loan ($80.0 par due 8/2026)   9.49% (Libor + 6.75%/Q)    

6/12/2018

    79.3     79.2 (2)(14)      

                      81.3     81.0        

                      335.9     244.7     3.33 %

                                     

Environmental Services

               

 

                   

                                     

MPH Energy Holdings, LP

  Operator of municipal recycling facilities   Limited partnership interest (3.13% interest)        

1/8/2014

        (2)      

                                     

RE Community Holdings GP, LLC and RE Community Holdings, LP

  Operator of municipal recycling facilities   Limited partnership interest (2.86% interest)        

3/1/2011

        (2)      

      Limited partnership interest (2.49% interest)        

3/1/2011

        (2)      

                                 

                                     

F-183


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Soil Safe, Inc. and Soil Safe Acquisition Corp.(7)(18)

  Provider of soil treatment, recycling and placement services   First lien senior secured revolving loan      

1/3/2017

        (16)      

      First lien senior secured loan ($17.0 par due 1/2020)   8.75% (Libor + 6.25%/M)    

1/3/2017

    17.0     17.0 (2)(14)      

      Second lien senior secured loan ($12.7 par due 6/2020)   10.75% (Libor + 7.75%/M)    

1/3/2017

    12.7     12.7 (2)(14)      

      Senior subordinated loan ($45.2 par due 12/2020)   16.50% PIK    

1/3/2017

    45.2     45.2 (2)      

      Senior subordinated loan ($37.8 par due 12/2020)   14.50% PIK    

1/3/2017

    37.8     37.8 (2)      

      Senior subordinated loan ($38.0 par due 12/2020)        

1/3/2017

    11.5     15.2 (2)(13)      

      Common stock (810 shares)        

1/3/2017

               

                      124.2     127.9        

                      124.2     127.9     1.75 %

Aerospace and Defense

               

 

                   

                                     

Cadence Aerospace, LLC(18)

  Aerospace precision components manufacturer   First lien senior secured revolving loan ($0.7 par due 11/2022)   9.10% (Libor + 6.50%/Q)    

11/14/2017

    0.7     0.7 (2)(14)(17)      

      First lien senior secured revolving loan ($3.0 par due 11/2022)   11.00% (Base Rate + 5.50%/Q)    

11/14/2017

    3.0     3.0 (2)(14)(17)      

      First lien senior secured loan ($32.1 par due 11/2023)   9.09% (Libor + 6.50%/Q)    

11/14/2017

    31.8     31.8 (3)(14)      

      First lien senior secured loan ($10.0 par due 11/2023)   9.10% (Libor + 6.50%/Q)    

7/5/2018

    10.0     9.9 (2)(14)      

                      45.5     45.4        

                                     

MB Aerospace Holdings II Corp.

  Aerospace engine components manufacturer   Second lien senior secured loan ($68.4 par due 1/2026)   11.10% (Libor + 8.50%/Q)    

1/22/2018

    68.4     67.7 (2)(14)      

                                     

Radius Aerospace, Inc.(18)

  Metal fabricator in the aerospace industry   First lien senior secured loan ($9.0 par due 3/2025)   8.35% (Libor + 5.75%/Q)    

3/29/2019

    9.0     8.9 (2)(14)      

                      122.9     122.0     1.66 %

                                     

Chemicals

               

 

                   

                                     

AMZ Holding Corp.(18)

  Specialty chemicals manufacturer   First lien senior secured loan ($0.0 par due 6/2022)   9.50% (Base Rate + 4.00%/Q)    

6/27/2017

        (4)(14)      

      First lien senior secured loan ($12.0 par due 6/2022)   7.50% (Libor + 5.00%/M)    

6/27/2017

    12.0     12.0 (4)(14)      

                      12.0     12.0        

                                     

Genomatica, Inc.

  Developer of a biotechnology platform for the production of chemical products   Warrant to purchase 322,422 shares of Series D preferred stock (expires 3/2023)        

3/28/2013

        (2)      

                                     

Plaskolite PPC Intermediate II LLC and Plaskolite PPC Blocker LLC

  Manufacturer of specialized acrylic and polycarbonate sheets   First lien senior secured loan ($24.9 par due 12/2025)   6.73% (Libor + 4.25%/M)    

12/14/2018

    24.5     24.4 (2)(14)      

      Second lien senior secured loan ($55.7 par due 12/2026)   10.24% (Libor + 7.75%/M)    

12/14/2018

    55.7     54.6 (2)(14)      

      Co-Invest units (5,969 units)        

12/14/2018

    0.6     0.6 (2)      

                      80.8     79.6        

                      92.8     91.6     1.25 %

                                     

Health Clubs

               

 

                   

                                     

Athletic Club Holdings, Inc.

  Premier health club operator   First lien senior secured loan ($3.2 par due 10/2020)   11.13% (Libor + 8.50%/Q)    

10/11/2007

    3.2     3.2 (3)(14)      

                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

CFW Co-Invest, L.P. and NCP Curves, L.P.

  Health club franchisor   Limited partnership interest (4,152,165 shares)        

7/31/2012

    4.2     11.9 (2)      

      Limited partnership interest (2,218,235 shares)        

7/31/2012

        (2)(8)      

                      4.2     11.9        

                                     

Movati Athletic (Group) Inc.(8)(18)

  Premier health club operator   First lien senior secured loan ($0.6 par due 10/2022)   6.81% (CIBOR + 4.50%/Q)    

10/5/2017

    0.6     0.6 (2)(14)      

      First lien senior secured loan ($2.9 par due 10/2022)   6.81% (CIBOR + 4.50%/Q)    

10/5/2017

    3.0     2.8 (2)(14)      

                      3.6     3.4        

                                     

Sunshine Sub, LLC(18)

  Premier health club operator   First lien senior secured loan ($5.8 par due 5/2024)   7.25% (Libor + 4.75%/M)    

5/25/2018

    5.8     5.7 (2)(14)      

      First lien senior secured loan ($9.8 par due 5/2024)   7.25% (Libor + 4.75%/M)    

5/25/2018

    9.8     9.7 (2)(14)      

                      15.6     15.4        

                                     

Taymax Group Acquisition, LLC and TCP Fit Parent, L.P.(18)

  Planet Fitness franchisee   First lien senior secured revolving loan ($0.2 par due 7/2024)   6.72% (Libor + 4.75%/M)    

7/31/2018

    0.2     0.2 (2)(14)      

      First lien senior secured revolving loan ($0.3 par due 7/2024)   7.25% (Libor + 4.75%/M)    

7/31/2018

    0.3     0.3 (2)(14)      

      First lien senior secured loan ($4.3 par due 7/2025)   7.35% (Libor + 4.75%/Q)    

7/31/2018

    4.3     4.3 (2)(14)      

      Class A units (30,000 units)        

7/31/2018

    3.0     3.6        

                      7.8     8.4        

                      34.4     42.3     0.58 %

                                     

Computers and Electronics

               

 

                   

                                     

Everspin Technologies, Inc.

  Designer and manufacturer of computer memory solutions   Warrant to purchase up to 18,461 shares of common stock (expires 10/2026)        

10/7/2016

    0.4     (2)(21)      

                                     

Imaging Business Machines, L.L.C. and Scanner Holdings Corporation(7)

  Provider of high-speed intelligent document scanning hardware and software   Senior subordinated loan ($8.3 par due 6/2022)   14%    

1/3/2017

    8.2     8.3 (2)      

      Senior subordinated loan ($8.3 par due 6/2022)   14%    

1/3/2017

    8.2     8.3 (2)      

      Series A preferred stock (66,424,135 shares)        

1/3/2017

        7.0        

      Class A common stock (33,173 shares)        

1/3/2017

               

      Class B common stock (134,214 shares)        

1/3/2017

               

                      16.4     23.6        

                                     

Zemax Software Holdings, LLC(18)

  Provider of optical illumination design software to design engineers   First lien senior secured loan ($17.0 par due 6/2024)   8.35% (Libor + 5.75%/Q)    

6/25/2018

    17.0     17.0 (3)(14)      

                      33.8     40.6     0.55 %

                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

Farming and Agriculture

               

 

                   

                                     

QC Supply, LLC(18)

  Specialty distributor and solutions provider to the swine and poultry markets   First lien senior secured revolving loan ($1.7 par due 12/2021)   8.50% (Libor + 6.00%/M)    

12/29/2016

    1.7     1.5 (2)(14)      

      First lien senior secured revolving loan ($2.0 par due 12/2021)   8.50% (Libor + 6.00%/M)    

12/29/2016

    2.0     1.8 (2)(14)      

      First lien senior secured revolving loan ($2.3 par due 12/2021)   8.50% (Libor + 6.00%/M)    

12/29/2016

    2.3     2.1 (2)(14)      

      First lien senior secured revolving loan ($4.0 par due 12/2021)   8.50% (Libor + 6.00%/M)    

12/29/2016

    4.0     3.7 (2)(14)      

      First lien senior secured loan ($8.7 par due 12/2022)   8.50% (Libor + 6.00%/M)    

12/29/2016

    8.7     7.9 (2)(14)      

      First lien senior secured loan ($11.1 par due 12/2022)   8.50% (Libor + 6.00%/M)    

12/29/2016

    11.1     10.1 (2)(14)      

      First lien senior secured loan ($14.7 par due 12/2022)   8.50% (Libor + 6.00%/M)    

12/29/2016

    14.7     13.5 (4)(14)      

                      44.5     40.6        

                      44.5     40.6     0.55 %

                                     

Hotel Services

               

 

                   

                                     

Aimbridge Acquisition Co., Inc.

  Hotel Operator   Second lien senior secured loan ($14.1 par due 2/2027)   9.99% (Libor + 7.50%/M)    

2/1/2019

    13.9     14.0 (2)(14)      

                                     

Pyramid Management Advisors, LLC and Pyramid Investors, LLC(18)

  Hotel Operator   First lien senior secured revolving loan ($1.7 par due 7/2021)   9.23% (Libor + 6.75%/M)    

4/12/2018

    1.7     1.7 (2)(14)(17)      

      First lien senior secured revolving loan ($0.1 par due 7/2021)   9.25% (Libor + 6.75%/M)    

4/12/2018

    0.1     0.1 (2)(14)(17)      

      First lien senior secured loan ($1.5 par due 7/2021)   9.25% (Libor + 6.75%/M)    

4/12/2018

    1.5     1.5 (2)(14)      

      First lien senior secured loan ($17.0 par due 7/2021)   9.25% (Libor + 6.75%/M)    

4/12/2018

    17.0     17.0 (2)(14)      

      Preferred membership units (996,833 units)        

7/15/2016

    1.0     1.2 (2)      

                      21.3     21.5        

                      35.2     35.5     0.48 %

                                     

Telecommunications

               

 

                   

                                     

Extenet Systems, Inc.(18)

  Provider of antenna networks for use by wireless service providers, government agencies, healthcare organizations and other commercial enterprises   First lien senior secured revolving loan ($0.8 par due 11/2022)   8.25% (Base Rate + 2.75%/Q)    

2/8/2018

    0.8     0.8 (2)(14)(17)      

                                     

LTG Acquisition, Inc.

  Designer and manufacturer of display, lighting and passenger communication systems for mass transportation markets   Class A membership units (5,000 units)        

1/3/2017

    5.1     4.0        

                                     

Startec Equity, LLC(7)

  Communication services   Member interest        

4/1/2010

               

                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 

TowerCo IV Finance LLC(18)

  Owner and operator of cellular telecommunications towers   First lien senior secured revolving loan ($0.4 par due 10/2021)   6.24% (Libor + 3.75%/M)    

2/8/2018

    0.4     0.4 (2)(14)      

      First lien senior secured revolving loan ($7.3 par due 10/2021)   6.24% (Libor + 3.75%/M)    

2/8/2018

    7.3     7.3 (2)(14)      

      First lien senior secured revolving loan ($1.3 par due 10/2021)   6.25% (Libor + 3.75%/M)    

2/8/2018

    1.3     1.3 (2)(14)      

                      9.0     9.0        

                      14.9     13.8     0.19 %

                                     

Retail

               

 

                   

                                     

Paper Source, Inc. and Pine Holdings, Inc.(18)

  Retailer of fine and artisanal paper products   First lien senior secured revolving loan ($0.7 par due 9/2019)   10.50% (Base Rate + 5.00%/M)    

9/23/2013

    0.7     0.7 (2)(14)      

      First lien senior secured loan ($9.3 par due 9/2019)   8.85% (Libor + 6.25%/Q)    

9/23/2013

    9.3     9.3 (4)(14)      

      Class A common stock (36,364 shares)        

9/23/2013

    6.0     3.0 (2)      

                      16.0     13.0        

                      16.0     13.0     0.18 %

                                     

Commercial Real Estate Financial

               

 

                   

                                     

ACAS Real Estate Holdings Corporation(7)

  Real estate holding company   Common stock (1,000 shares)        

1/3/2017

    2.6     2.6        

                                     

NECCO Realty Investments LLC(7)

  Real estate holding company   Membership units (7,450 units)        

1/3/2017

               

                      2.6     2.6     0.04 %

                                     

Housing and Building Materials

               

 

                   

                                     

Halex Holdings, Inc.(7)(18)

  Manufacturer of flooring installation products   First lien senior secured revolving loan ($1.9 par due 12/2018)        

1/24/2017

    1.9            

      Common stock (51,853 shares)        

1/3/2017

               

                      1.9            

                      1.9         %

                                     

Printing, Publishing and Media

               

 

                   

                                     

The Teaching Company Holdings, Inc.

  Education publications provider   Preferred stock (10,663 shares)        

9/29/2006

    1.1     (2)      

      Common stock (15,393 shares)        

9/29/2006

        (2)      

                      1.1            

                      1.1         %

                                     

Total Investments

                      13,440.1     13,063.6     178.02 %

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Table of Contents

Derivative Instruments

Foreign currency forward contracts

Description
  Notional Amount
to be Purchased
  Notional Amount
to be sold
  Counterparty   Settlement Date   Unrealized Appreciation /
(Depreciation)
 

Foreign currency forward contract

  $ 3   CAD 5   Bank of Montreal   4/5/2019   $  

Foreign currency forward contract

  $ 7   CAD 9   Bank of Montreal   4/5/2019      

Foreign currency forward contract

  $ 17   15   Bank of Montreal   4/10/2019      

Foreign currency forward contract

  $ 89   £ 69   Bank of Montreal   5/17/2019     (1 )

Total

                      $ (1 )

Interest rate swap

Description
  Payment Terms   Counterparty   Maturity Date   Notional
Amount
  Value   Upfront
Payments/
Receipts
  Unrealized
Appreciation /
(Depreciation)
 

Interest rate swap

  Pay Fixed 2.0642%   Receive Floating One-Month Libor of 2.5%   Bank of Montreal   January 4, 2021     395   $ 1.7   $   $ 2  

Total

                                    $ 2  

(1)
Other than the Company's investments listed in footnote 7 below (subject to the limitations set forth therein), the Company does not "Control" any of its portfolio companies, for the purposes of the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the "Investment Company Act"). In general, under the Investment Company Act, the Company would "Control" a portfolio company if the Company owned more than 25% of its outstanding voting securities (i.e., securities with the right to elect directors) and/or had the power to exercise control over the management or policies of such portfolio company. All of the Company's portfolio company investments, which as of March 31, 2019 represented 178% of the Company's net assets or 94% of the Company's total assets, are subject to legal restrictions on sales.

(2)
These assets are pledged as collateral for the Revolving Credit Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company's obligations under the Revolving Credit Facility (see Note 5).

(3)
These assets are owned by the Company's consolidated subsidiary Ares Capital CP Funding LLC ("Ares Capital CP"), are pledged as collateral for the Revolving Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than Ares Capital CP's obligations under the Revolving Funding Facility (see Note 5).

(4)
These assets are owned by the Company's consolidated subsidiary Ares Capital JB Funding LLC ("ACJB"), are pledged as collateral for the SMBC Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than ACJB's obligations under the SMBC Funding Facility (see Note 5).

(5)
Investments without an interest rate are non-income producing

(6)
As defined in the Investment Company Act, the Company is deemed to be an "Affiliated Person" because it owns 5% or more of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company (including through a management

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Table of Contents

    agreement). Transactions as of and during the three months ended March 31, 2019 in which the issuer was an Affiliated Person (but not a portfolio company that the Company is deemed to Control) are as follows:

 
  For the Three Months Ended March 31, 2019   As of
March 31,
2019
 
 
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service fees
  Dividend
income
  Other
income
  Net realized
gains (losses)
  Net
unrealized
gains (losses)
 
(in millions)
Company
  Fair Value  

Blue Angel Buyer 1, LLC and Blue Angel Holdco, LLC

  $ 20.4   $ 1.1   $   $ 0.2   $ 0.3   $ 0.2   $   $   $ (0.2 ) $ 19.4  

Blue Wolf Capital Fund II, L.P.

  $   $   $   $   $   $   $   $   $   $ 2.5  

Bragg Live Food Products, LLC and SPC Investment Co., L.P.

  $ 51.9   $   $   $ 0.2   $ 1.3   $   $   $   $ (0.4 ) $ 51.4  

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC

  $ 11.0   $ 0.1   $   $ 0.9   $ 0.3   $   $   $   $ (0.3 ) $ 49.6  

ESCP PPG Holdings, LLC

  $   $   $   $   $   $   $   $   $ 0.4   $ 2.8  

European Capital UK SME Debt LP

  $ 1.6   $   $   $   $   $ 0.6   $   $   $ (1.5 ) $ 39.6  

Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Ioxus, Inc.

  $   $   $   $ 0.1   $   $   $   $   $   $ 7.1  

NSI Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Panda Temple Power, LLC and T1 Power Holdings LLC

  $   $   $   $ 0.3   $   $   $   $   $ (0.7 ) $ 21.5  

Partnership Capital Growth Fund I, L.P.

  $   $   $   $   $   $   $   $   $ (0.1 ) $  

PCG-Ares Sidecar Investment II, L.P.

  $   $   $   $   $   $   $   $   $ (0.6 ) $ 16.8  

PCG-Ares Sidecar Investment, L.P.

  $   $   $   $   $   $   $   $   $   $ 4.4  

Petroflow Energy Corporation and TexOak Petro Holdings LLC

  $   $ 8.2   $   $   $   $   $   $   $ (0.1 ) $  

PIH Corporation and Primrose Holding Corporation

  $   $   $ 1.6   $   $   $   $   $   $ (0.3 ) $ 23.7  

Shock Doctor, Inc. and Shock Doctor Holdings, LLC

  $   $   $   $ 3.1   $   $   $   $   $ (2.9 ) $ 78.6  

UL Holding Co., LLC

  $   $   $   $ 0.9   $   $   $   $   $ (0.1 ) $ 43.0  

  $ 84.9   $ 9.4   $ 1.6   $ 5.7   $ 1.9   $ 0.8   $   $   $ (6.8 ) $ 360.4  
(7)
As defined in the Investment Company Act, the Company is deemed to be both an "Affiliated Person" and "Control" this portfolio company because it owns more than 25% of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company

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Table of Contents

    (including through a management agreement). Transactions as of and during the three months ended March 31, 2019 in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to Control are as follows:

 
  For the Three Months Ended March 31, 2019   As of
March 31,
2019
 
 
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service fees
  Dividend
income
  Other
income
  Net realized
gains (losses)
  Net
unrealized
gains (losses)
 
(in millions)
Company
  Fair Value  

ACAS Equity Holdings Corporation

  $   $   $   $   $   $   $   $   $   $ 0.4  

ACAS Real Estate Holdings Corporation

  $   $   $   $   $   $   $   $   $ 0.7   $ 2.6  

ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.

  $   $   $   $ (0.1 ) $   $   $   $   $ (2.0 ) $ 4.1  

CoLTs 2005-1 Ltd.

  $   $   $   $   $   $   $   $   $   $  

CoLTs 2005-2 Ltd.

  $   $   $   $   $   $   $   $   $   $  

CSHM LLC

  $   $   $   $   $   $   $   $   $   $  

Eckler Industries, Inc. and Eckler Purchaser LLC

  $ 1.5   $   $   $ 0.6   $   $   $   $   $ (2.7 ) $ 22.2  

ETG Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Halex Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

HCI Equity, LLC

  $   $   $   $   $   $   $   $   $   $ 0.1  

Imaging Business Machines, L.L.C. and Scanner Holdings Corporation

  $   $   $   $ 0.6   $   $   $ 0.2   $   $ (1.1 ) $ 23.6  

Ivy Hill Asset Management, L.P.

  $   $   $   $   $   $ 15.0   $   $   $ 16.1   $ 534.0  

Joyce Lane Capital LLC and Joyce Lane Financing SPV LLC (fka Ciena Capital LLC)

  $   $   $   $   $   $   $   $   $ (0.2 ) $ 3.7  

LLSC Holdings Corporation (dba Lawrence Merchandising Services)

  $   $   $   $   $   $   $   $   $   $ 0.4  

Montgomery Lane, LLC and Montgomery Lane, Ltd.

  $   $   $   $   $   $   $   $   $   $  

MVL Group, Inc.

  $   $   $   $   $   $   $   $   $   $  

Navisun LLC and Navisun Holdings LLC

  $ 20.4   $   $   $ 0.6   $ 0.3   $ 0.1   $   $   $ 0.2   $ 49.1  

NECCO Holdings, Inc. and New England Confectionery Company, Inc.

  $   $   $   $   $   $   $   $   $   $ 4.6  

NECCO Realty Investments LLC

  $   $   $   $   $   $   $   $   $   $  

Orion Foods, LLC

  $   $   $   $   $   $   $   $   $   $ 0.4  

PHL Investors, Inc., and PHL Holding Co.

  $   $   $   $   $   $   $   $   $   $  

Rug Doctor, LLC and RD Holdco Inc.

  $   $   $   $ 0.5   $   $   $   $   $ (6.7 ) $ 21.3  

S Toys Holdings LLC (fka The Step2 Company, LLC)

  $   $   $   $   $   $   $   $   $ (0.1 ) $ 0.3  

Senior Direct Lending Program, LLC

  $ 141.8   $ 1.6   $   $ 27.2   $ 3.5   $   $   $   $   $ 791.9  

Singer Sewing Company, SVP-Singer Holdings, LLC and SVP-Singer Holdings LP

  $ 13.0   $ 5.2   $   $ 4.6   $   $   $   $   $ (8.1 ) $ 235.3  

Soil Safe, Inc. and Soil Safe Acquisition Corp.

  $   $ 1.0   $   $ 3.9   $   $   $ 0.1   $   $ 5.0   $ 127.9  

Startec Equity, LLC

  $   $   $   $   $   $   $   $   $   $  

  $ 176.7   $ 7.8   $   $ 37.9   $ 3.8   $ 15.1   $ 0.3   $   $ 1.1   $ 1,821.9  

*
Together with Varagon Capital Partners ("Varagon") and its clients, the Company has co-invested through the Senior Direct Lending Program LLC (d/b/a the "Senior Direct Lending Program" or the "SDLP"). The SDLP has been capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of the Company and Varagon (with approval from a representative of each required); therefore, although the Company owns more than 25% of the voting securities of the SDLP, the Company does not believe that it has control over the SDLP (for purposes of the Investment Company Act or otherwise) because, among other things, these "voting securities" do not afford the Company the right to elect directors of the SDLP or any other special rights (see Note 4).
(8)
This portfolio company is not a qualifying asset under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of the Company's total assets. Pursuant to Section 55(a) of the Investment Company Act 15% of the Company's total assets are represented by investments at fair value and other assets that are considered "non-qualifying assets" as of March 31, 2019.

(9)
Variable rate loans to the Company's portfolio companies bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate ("LIBOR") or an alternate base rate (commonly based on the Federal Funds Rate or the Prime Rate), at the borrower's option, which reset annually (A), semi-annually (S), quarterly (Q), bi-monthly (B), monthly (M) or daily (D). For each such loan, the Company has provided the interest rate in effect on the date presented.

(10)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on $69.5 in aggregate principal amount of a "first out" tranche of the portfolio company's senior term debt previously syndicated by the Company into "first out" and

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    "last out" tranches, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(11)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on $38.6 in aggregate principal amount of a "first out" tranche of the portfolio company's first lien senior secured loans, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(12)
The Company sold a participating interest of approximately $1.7 in aggregate principal amount of the portfolio company's first lien senior secured term loan. As the transaction did not qualify as a "true sale" in accordance with U.S. generally accepted accounting principles, the Company recorded a corresponding $1.7 secured borrowing included in "accounts payable and other liabilities" in the accompanying consolidated balance sheet.

(13)
Loan was on non-accrual status as of March 31, 2019.

(14)
Loan includes interest rate floor feature.

(15)
In addition to the interest earned based on the stated contractual interest rate of this security, the certificates entitle the holders thereof to receive a portion of the excess cash flow from the SDLP's loan portfolio, after expenses, which may result in a return to the Company greater than the contractual stated interest rate.

(16)
As of March 31, 2019, no amounts were funded by the Company under this first lien senior secured revolving loan; however, there were letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 for further information on letters of credit commitments related to certain portfolio companies.

(17)
As of March 31, 2019, in addition to the amounts funded by the Company under this first lien senior secured revolving loan, there were also letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 for further information on letters of credit commitments related to certain portfolio companies.

(18)
As of March 31, 2019, the Company had the following commitments to fund various revolving and delayed draw senior secured and subordinated loans, including commitments to issue letters of credit through a financial intermediary on behalf of certain portfolio companies. Such commitments are subject to the satisfaction of certain conditions set forth in the documents governing these loans and letters of credit and there can be no assurance that such conditions will be satisfied. See Note 7 for further information on revolving and delayed draw loan commitments, including commitments to issue letters of credit, related to certain portfolio companies.
(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

1A Smart Start LLC

  $ 3.5   $ (0.9 ) $ 2.6   $   $   $ 2.6  

42 North Dental, LLC

    5.0         5.0             5.0  

A.U.L. Corp.

    1.2         1.2             1.2  

Accommodations Plus Technologies LLC

    4.1         4.1             4.1  

Achilles Acquisition LLC

    12.4         12.4             12.4  

ADCS Clinics Intermediate Holdings, LLC

    5.0     (1.3 )   3.7             3.7  

ADF Pizza I, LLC

    1.3         1.3             1.3  

ADG, LLC

    13.7     (13.7 )                

Alcami Corporation

    29.0     (3.5 )   25.5             25.5  

Alera Group Intermediate Holdings, Inc.

    31.9         31.9             31.9  

AMCP Clean Intermediate, LLC

    6.1     (1.5 )   4.6             4.6  

American Academy Holdings, LLC

    7.0     (0.9 )   6.1             6.1  

AMZ Holding Corp.

    3.4         3.4             3.4  

Apex Clean Energy Holdings, LLC

    5.0     (5.0 )                

Apptio, Inc.

    4.2         4.2             4.2  

Athenahealth, Inc.

    33.1         33.1             33.1  

Avetta, LLC

    7.0         7.0             7.0  

Bambino CI Inc.

    9.6     (2.3 )   7.3             7.3  

Blue Angel Buyer 1, LLC

    8.6         8.6             8.6  

Blue Campaigns Intermediate Holding Corp.

    3.0         3.0             3.0  

Bragg Live Food Products LLC

    4.4         4.4             4.4  

Cadence Aerospace, LLC

    14.3     (4.0 )   10.3             10.3  

Capstone Logistics Acquisition, Inc.

    2.0     (0.8 )   1.2             1.2  

Care Hospice, Inc.

    2.3     (1.2 )   1.1             1.1  

CB Trestles OpCo, LLC

    32.2     (4.0 )   28.2             28.2  

CCS-CMGC Holdings, Inc.

    12.0     (9.5 )   2.5             2.5  

Center for Autism and Related Disorders, LLC

    8.5     (0.4 )   8.1             8.1  

Chariot Acquisition, LLC

    1.0         1.0             1.0  

Chesapeake Research Review, LLC

    5.8         5.8             5.8  

Clearwater Analytics, LLC

    5.0         5.0             5.0  

Command Alkon Incorporated

    6.3     (4.2 )   2.1             2.1  

Comprehensive EyeCare Partners, LLC

    3.7     (0.4 )   3.3             3.3  

Corepoint Health, LLC

    4.3         4.3             4.3  

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(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

Cozzini Bros., Inc.

    15.0     (3.5 )   11.5             11.5  

Crown Health Care Laundry Services, Inc.

    13.0     (0.9 )   12.1             12.1  

CST Buyer Company

    4.2         4.2             4.2  

D4C Dental Brands, Inc.

    5.0         5.0             5.0  

DCA Investment Holding, LLC

    5.8     (0.1 )   5.7             5.7  

DecoPac, Inc.

    8.1         8.1             8.1  

DFC Global Facility Borrower II LLC

    115.0     (94.6 )   20.4             20.4  

DGH Borrower LLC

    17.2         17.2             17.2  

Display Holding Company, Inc., Saldon Holdings, Inc. and Fastsigns Holdings Inc.

    2.3     (0.1 )   2.2             2.2  

Dorner Holding Corp.

    3.3         3.3             3.3  

Doxim Inc.

    1.2         1.2             1.2  

DRB Holdings, LLC

    9.9     (5.3 )   4.6             4.6  

DTI Holdco, Inc.

    8.8     (2.2 )   6.6             6.6  

Eckler Industries, Inc.

    5.6     (2.8 )   2.8     (2.8 )        

Emergency Communications Network, LLC

    6.5         6.5             6.5  

Emerus Holdings, Inc.

    4.5         4.5             4.5  

EN Engineering, L.L.C.

    5.0         5.0             5.0  

Entertainment Partners, LLC

    28.0         28.0             28.0  

Episerver, Inc.

    10.3         10.3             10.3  

ExteNet Systems, Inc.

    2.0     (0.8 )   1.2             1.2  

Ferraro Fine Foods Corp.

    9.8     (0.8 )   9.0             9.0  

Flinn Scientific, Inc.

    10.0         10.0             10.0  

Flow Control Solutions, Inc.

    14.4         14.4             14.4  

FM:Systems Group, LLC

    1.5         1.5             1.5  

Foundation Risk Partners, Corp.

    15.8     (3.6 )   12.2             12.2  

Frontline Technologies Intermediate Holdings, LLC

    6.5         6.5             6.5  

FS Squared Holding Corp.

    11.2         11.2             11.2  

FWR Holding Corporation

    3.3     (0.6 )   2.7             2.7  

Garden Fresh Restaurant Corp.

    7.5     (3.5 )   4.0             4.0  

GB Auto Service, Inc.

    34.4         34.4             34.4  

Genesis Acquisition Co.

    9.5         9.5             9.5  

GraphPAD Software, LLC

    1.1         1.1             1.1  

GTCR-Ultra Holdings III, LLC and GTCR-Ultra Holdings LLC

    2.0         2.0             2.0  

HAI Acquisition Corporation

    19.0         19.0             19.0  

Halex Holdings, Inc.

    2.0     (1.9 )   0.1             0.1  

Harvey Tool Company, LLC

    28.1     (0.5 )   27.6             27.6  

Help/Systems Holdings, Inc.

    5.0         5.0             5.0  

Hometown Food Company

    3.9     (0.2 )   3.7             3.7  

Hygiena Borrower LLC

    12.4     (0.2 )   12.2             12.2  

IMIA Holdings, Inc.

    9.9     (0.4 )   9.5             9.5  

Infilaw Corporation

    6.2     (6.2 )                

Infinite Electronics International, Inc.

    3.0         3.0             3.0  

Infogix, Inc.

    5.3         5.3             5.3  

IntraPac International LLC

    20.3     (3.3 )   17.0             17.0  

Invoice Cloud, Inc.

    18.3         18.3             18.3  

iPipeline, Inc.

    4.0         4.0             4.0  

JDC Healthcare Management, LLC

    9.8     (1.6 )   8.2             8.2  

Jim N Nicks Management LLC

    9.7     (2.8 )   6.9             6.9  

Joyce Lane Financing SPV LLC

    1.3         1.3             1.3  

Kaufman, Hall & Associates, LLC

    8.0     (0.5 )   7.5             7.5  

KBHS Acquisition, LLC (d/b/a Alita Care, LLC)

    5.0     (4.9 )   0.1             0.1  

Key Surgical LLC

    2.8         2.8             2.8  

KHC Holdings, Inc.

    6.9     (0.4 )   6.5             6.5  

Labstat International Inc.

    3.8         3.8             3.8  

LBP Intermediate Holdings LLC

    0.9     (0.1 )   0.8             0.8  

Liaison Acquisition, LLC

    3.9         3.9             3.9  

Lone Wolf Real Estate Technologies Inc.

    3.0         3.0             3.0  

Mac Lean-Fogg Company

    8.4         8.4             8.4  

Magento, Inc.

    7.5     (0.2 )   7.3             7.3  

Masergy Holdings, Inc.

    2.5         2.5             2.5  

Massage Envy, LLC

    7.7         7.7             7.7  

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Table of Contents

(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

Mavis Tire Express Services Corp.

    23.3         23.3             23.3  

MB2 Dental Solutions, LLC

    4.6     (1.9 )   2.7             2.7  

McKenzie Sports Products, LLC

    4.5     (1.4 )   3.1             3.1  

Ministry Brands, LLC

    25.4         25.4             25.4  

Movati Athletic (Group) Inc.

    2.4         2.4             2.4  

MSHC, Inc.

    22.9     (1.7 )   21.2             21.2  

Murchison Oil and Gas, LLC

    10.0         10.0             10.0  

MW Dental Holding Corp.

    15.2     (6.0 )   9.2             9.2  

National Intergovernmental Purchasing Alliance Company

    9.0         9.0             9.0  

Navisun LLC

    16.5         16.5             16.5  

NECCO Holdings, Inc.

    25.0     (19.9 )   5.1     (5.1 )        

NM GRC HOLDCO, LLC

    1.4         1.4             1.4  

NMC Skincare Intermediate Holdings II, LLC

    15.7     (1.6 )   14.1             14.1  

NMN Holdings III Corp

    12.5         12.5             12.5  

Nordco Inc.

    12.5     (2.6 )   9.9             9.9  

NSM Sub Holdings Corp.

    5.0         5.0             5.0  

NueHealth Performance, LLC

    7.0         7.0             7.0  

OTG Management, LLC

    16.0     (10.0 )   6.0             6.0  

Paper Source, Inc.

    2.5     (0.7 )   1.8             1.8  

Park Place Technologies, LLC

    5.4         5.4             5.4  

Pathway Vet Alliance LLC

    85.7     (0.5 )   85.2             85.2  

PDI TA Holdings, Inc.

    16.8         16.8             16.8  

Pegasus Intermediate Holdings, LLC

    5.0         5.0             5.0  

Perforce Software, Inc.

    1.4         1.4             1.4  

Phylogeny, LLC and Conversant Biologics, LLC (fka WSHP FC Acquisition LLC)

    11.7         11.7             11.7  

PIH Corporation

    3.3     (1.0 )   2.3             2.3  

Practice Insight, LLC

    2.9         2.9             2.9  

Premise Health Holding Corp.

    40.0     (3.0 )   37.0             37.0  

Project Silverback Holdings Corp.

    6.5         6.5             6.5  

Pyramid Management Advisors, LLC

    5.5     (1.9 )   3.6             3.6  

QC Supply, LLC

    10.0     (10.0 )                

R1 RCM Inc.

    10.0         10.0             10.0  

Radius Aerospace, Inc.

    1.8         1.8             1.8  

Raptor Technologies, LLC

    10.1         10.1             10.1  

RecoveryDirect Acquisition, L.L.C.

    8.0         8.0             8.0  

Retriever Medical/Dental Payments LLC

    3.5         3.5             3.5  

Revint Intermediate II, LLC

    16.6     (10.3 )   6.3             6.3  

Rialto Management Group, LLC

    1.0         1.0             1.0  

RMP Group, Inc.

    1.8         1.8             1.8  

Salter Labs

    1.7     (0.6 )   1.1             1.1  

Sanders Industries Holdings, Inc.

    10.0         10.0             10.0  

SCM Insurance Services Inc.

    4.0     (4.0 )                

SCSG EA Acquisition Company, Inc.

    4.0     (0.2 )   3.8             3.8  

SecurAmerica, LLC

    18.6         18.6             18.6  

Securelink, Inc

    3.0         3.0             3.0  

Severin Acquisition, LLC

    9.0     (1.9 )   7.1             7.1  

SFE Intermediate HoldCo LLC

    10.2         10.2             10.2  

Shift PPC LLC

    4.4         4.4             4.4  

Sigma Electric Manufacturing Corporation

    10.0     (2.6 )   7.4             7.4  

Singer Sewing Company

    90.0     (85.7 )   4.3             4.3  

SiroMed Physician Services, Inc.

    7.1     (2.9 )   4.2             4.2  

Siteworx, LLC

    1.5     (1.5 )                

SM Wellness Holdings, Inc.

    10.5         10.5             10.5  

Soil Safe, Inc.

    10.5     (3.6 )   6.9             6.9  

Sonny's Enterprises, LLC

    3.6     (1.7 )   1.9             1.9  

Sovos Brands Intermediate, Inc.

    4.3         4.3             4.3  

SpareFoot, LLC

    1.4     (0.3 )   1.1             1.1  

Spectra Finance, LLC

    24.1     (4.9 )   19.2             19.2  

St. Croix Acquisition Corp.

    2.0         2.0             2.0  

Storm UK Holdco Limited and Storm US Holdco Inc.

    1.1         1.1             1.1  

Sunshine Sub, LLC

    5.8         5.8             5.8  

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Table of Contents

(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

Symmetry Surgical Inc.

    3.1         3.1             3.1  

Synergy HomeCare Franchising, LLC

    4.2         4.2             4.2  

Taymax Group Holdings, LLC

    3.2     (0.6 )   2.6             2.6  

TDG Group Holding Company

    14.6     (0.1 )   14.5             14.5  

Teasdale Foods, Inc.

    0.8     (0.2 )   0.6             0.6  

Telestream Holdings Corporation

    2.3     (0.1 )   2.2             2.2  

Teligent, Inc.

    22.8         22.8             22.8  

The Ultimus Group Midco, LLC

    6.9         6.9             6.9  

Tidi Products, LLC

    2.3         2.3             2.3  

Total Community Options, Inc.

    4.2         4.2             4.2  

Touchstone Acquisition, Inc.

    11.2         11.2             11.2  

TowerCo Finance LLC

    17.0     (9.0 )   8.0             8.0  

TU BidCo, Inc.

    18.5     (0.1 )   18.4             18.4  

U.S. Acute Care Solutions, LLC

    1.7         1.7             1.7  

United Digestive MSO Parent, LLC

    17.2         17.2             17.2  

Urgent Cares of America Holdings I, LLC

    10.0         10.0             10.0  

Utility Pipeline, LTD.

    3.0         3.0             3.0  

Vela Trading Technologies LLC

    3.5     (0.5 )   3.0             3.0  

Verscend Holding Corp.

    22.5         22.5             22.5  

Visual Edge Technology, Inc.

    0.8         0.8             0.8  

VLS Recovery Services, LLC

    20.6     (4.1 )   16.5             16.5  

VRC Companies, LLC

    5.7     (1.0 )   4.7             4.7  

WatchFire Enterprises, Inc.

    2.0         2.0             2.0  

West Dermatology, LLC

    14.2     (5.0 )   9.2             9.2  

WIRB—Copernicus Group, Inc.

    3.0         3.0             3.0  

Woodstream Group, Inc.

    4.7     0.1     4.8             4.8  

Worldwide Facilities LLC

    1.3     (0.4 )   0.9             0.9  

Wrench Group LLC

    2.8     0.1     2.9             2.9  

XIFIN, Inc.

    4.6         4.6             4.6  

Zemax Software Holdings, LLC

    4.1         4.1             4.1  

Zywave, Inc.

    11.5     (6.3 )   5.2             5.2  

  $ 1,871.7   $ (405.2 ) $ 1,466.5   $ (7.9 ) $   $ 1,458.6  
(20)
As of March 31, 2019, the Company was party to subscription agreements to fund equity investments in private equity investment partnerships as follows:
(in millions)
Company
  Total private
equity
commitments
  Less: funded
private equity
commitments
  Total
unfunded
private equity
commitments
  Less: private
equity
commitments
substantially at
the
discretion of the
Company
  Total net
adjusted
unfunded
private
equity
commitments
 

Partnership Capital Growth Investors III, L.P. 

  $ 5.0   $ (4.9 ) $ 0.1   $   $ 0.1  

PCG-Ares Sidecar Investment, L.P. and PCG-Ares Sidecar Investment II, L.P.

    50.0     (12.4 )   37.6     (37.6 )    

Piper Jaffray Merchant Banking Fund I, L.P.

    2.0     (2.0 )            

European Capital UK SME Debt LP

    58.4     (50.1 )   8.3     (8.3 )    

  $ 115.4   $ (69.4 ) $ 46.0   $ (45.9 ) $ 0.1  
(21)
As of March 31, 2019, the Company had commitments to co-invest in the SDLP for its portion of the SDLP's commitment to fund delayed draw loans of up to $57.7. See Note 4 for more information on the SDLP.

(22)
Other than the investments noted by this footnote, the fair value of the Company's investments is determined using unobservable inputs that are significant to the overall fair value measurement. See Note 8 for more information regarding the fair value of the Company's investments.

(23)
As of March 31, 2019, the net estimated unrealized loss for federal tax purposes was $0.6 billion based on a tax cost basis of $13.6 billion. As of March 31, 2019, the estimated aggregate gross unrealized loss for federal income tax purposes was $0.9 billion and the estimated aggregate gross unrealized gain for federal income tax purposes was $0.3 billion.

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Table of Contents


ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of December 31, 2018
(dollar amounts in millions)

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Healthcare Services                                      
Absolute Dental Management LLC and ADM Equity, LLC   Dental services provider   First lien senior secured loan ($19.1 par due 1/2022)         1/5/2016   $ 19.1   $ 11.8 (2)(13)      
        First lien senior secured loan ($5.1 par due 1/2022)         1/5/2016     5.1     3.1 (4)(13)      
        Class A preferred units (4,000,000 units)         1/5/2016     4.0     (2)      
        Class A common units (4,000,000 units)         1/5/2016         (2)      
                        28.2     14.9        
                                       
Acessa Health Inc. (fka HALT Medical, Inc.)   Medical supply provider   Common stock (569,823 shares)         6/22/2017     0.1            
                                       
ADCS Billings Intermediate Holdings, LLC(18)   Dermatology practice   First lien senior secured revolving loan ($1.3 par due 5/2022)   10.25%
(Base Rate + 4.75%/Q)
    5/18/2016     1.3     1.2 (2)(14)      
                                       
ADG, LLC and RC IV GEDC Investor LLC(18)   Dental services provider   First lien senior secured revolving loan ($3.1 par due 9/2022)   7.27%
(Libor + 4.75%/M)
    9/28/2016     3.1     3.0 (2)(14)      
        First lien senior secured revolving loan ($8.1 par due 9/2022)   9.25%
(Base Rate + 3.75%/M)
    9/28/2016     8.1     7.8 (2)(14)      
        Second lien senior secured loan ($87.5 par due 3/2024)   11.88%
(Libor + 9.00%/Q)
    9/28/2016     87.5     77.0 (2)(14)      
        Membership units (3,000,000 units)         9/28/2016     3.0     1.0 (2)      
                        101.7     88.8        
                                       
Air Medical Group Holdings, Inc. and Air Medical Buyer Corp.   Emergency air medical services provider   Senior subordinated loan ($182.7 par due 3/2026)   10.38%
(Libor + 7.88%/M)
    3/14/2018     182.7     182.7 (2)(14)      
        Warrant to purchase up to 115,733 units of common stock (expires 3/2028)         3/14/2018     0.9     1.6 (2)      
                        183.6     184.3        
                                       
Alcami Corporation and ACM Holdings I, LLC(18)   Outsourced drug development services provider   First lien senior secured revolving loan ($1.8 par due 7/2023)   6.26%
(Libor + 3.75%/M)
    7/12/2018     1.8     1.8 (2)(14)      
        First lien senior secured revolving loan ($1.7 par due 7/2023)   6.21%
(Libor + 3.75%/M)
    7/12/2018     1.7     1.7 (2)(14)      
        First lien senior secured loan ($30.1 par due 7/2025)   6.71%
(Libor + 4.25%/M)
    7/12/2018     30.0     29.8 (3)(14)      
        Second lien senior secured loan ($77.5 par due 7/2026)   10.51%
(Libor + 8.00%/M)
    7/12/2018     76.8     76.0 (2)(14)      
        Common units (3,269,900 units)         7/12/2018     32.7     26.1 (2)      
                        143.0     135.4        
                                       
Alteon Health, LLC   Provider of physician management services   First lien senior secured loan ($3.0 par due 9/2022)   9.02%
(Libor + 6.50%/M)
    5/15/2017     3.0     2.5 (2)(14)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
American Academy Holdings, LLC(18)   Provider of education, training, certification, networking, and consulting services to medical coders and other healthcare professionals   First lien senior secured revolving loan ($0.9 par due 12/2022)   9.05%
(Libor + 6.25%/Q)
    12/15/2017     0.9     0.9 (2)(14)      
        First lien senior secured loan ($85.8 par due 12/2022)   9.05%
(Libor + 6.25%/Q)
    12/15/2017     85.8     85.8 (2)(14)      
        First lien senior secured loan ($92.4 par due 12/2022)   9.05%
(Libor + 6.25%/Q)
    12/15/2017     92.4     92.4 (3)(14)      
        Senior subordinated loan ($79.9 par due 6/2023)   16.33%
(Libor + 8.00% Cash, 6.00% PIK/Q)
    12/15/2017     79.9     79.9 (2)(14)      
                        259.0     259.0        
                                       
Bambino CI Inc.(18)   Manufacturer and provider of single-use obstetrics products   First lien senior secured revolving loan ($0.3 par due 12/2023)   7.93%
(Libor + 5.50%/M)
    10/17/2017     0.3     0.3 (2)(14)      
        First lien senior secured loan ($2.5 par due 12/2024)   8.02%
(Libor + 5.50%/M)
    10/17/2017     2.5     2.5 (2)(14)      
        First lien senior secured loan ($30.9 par due 12/2024)   8.02%
(Libor + 5.50%/M)
    10/17/2017     30.9     30.9 (3)(14)      
                        33.7     33.7        
                                       
Care Hospice, Inc(18)   Provider of hospice services   First lien senior secured revolving loan ($0.3 par due 4/2022)   7.22%
(Libor + 4.75%/M)
    2/8/2018     0.3     0.3 (2)(14)(17)      
                                       
CCS-CMGC Holdings, Inc.(18)   Correctional facility healthcare operator   First lien senior secured revolving loan ($1.9 par due 10/2023)   8.02%
(Libor + 5.50%/M)
    10/1/2018     1.9     1.8 (2)(14)(17)      
        First lien senior secured loan ($35.0 par due 10/2025)   8.02%
(Libor + 5.50%/M)
    9/25/2018     34.7     34.8 (3)(14)      
                        36.6     36.6        
                                       
Center for Autism and Related Disorders, LLC(18)   Autism treatment and services provider specializing in applied behavior analysis therapy   First lien senior secured revolving loan       11/21/2018         (16)      
                                       
Comprehensive EyeCare Partners, LLC(18)   Vision care practice management company   First lien senior secured revolving loan ($0.2 par due 2/2024)   9.00%
(Base Rate + 3.50%/Q)
    2/14/2018     0.2     0.2 (2)(14)      
        First lien senior secured loan ($2.4 par due 2/2024)   7.30%
(Libor + 4.50%/Q)
    2/14/2018     2.4     2.4 (2)(14)      
        First lien senior secured loan ($5.4 par due 2/2024)   7.30%
(Libor + 4.50%/Q)
    2/14/2018     5.4     5.4 (2)(14)      
                        8.0     8.0        
                                       
CSHM LLC(7)   Dental services provider   Class A membership units (1,979 units)         1/3/2017                
                                       
D4C Dental Brands HoldCo, Inc. and Bambino Group Holdings, LLC(18)   Dental services provider   First lien senior secured revolving loan ($3.3 par due 12/2022)   10.75%
(Base Rate + 5.25%/Q)
    12/21/2016     3.3     3.3 (2)(14)      
        Class A preferred units (1,000,000 units)         12/21/2016     1.0     1.3 (2)      
                        4.3     4.6        
                                       
Datix Bidco Limited(8)   Global healthcare software company that provides software solutions for patient safety and risk management   First lien senior secured loan ($5.8 par due 4/2025)   7.28%
(Libor + 4.50%/S)
    4/27/2018     5.7     5.8 (2)(14)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
DCA Investment Holding, LLC(18)   Multi-branded dental practice management   First lien senior secured revolving loan ($0.4 par due 7/2021)   9.75%
(Base Rate + 4.25%/Q)
    7/2/2015     0.4     0.4 (2)(14)(17)      
        First lien senior secured loan ($18.5 par due 7/2021)   8.05%
(Libor + 5.25%/Q)
    7/2/2015     18.5     18.5 (4)(14)      
                        18.9     18.9        
                                       
Emerus Holdings, Inc.(18)   Freestanding 24-hour emergency care micro-hospitals operator   First lien senior secured revolving loan ($3.0 par due 9/2020)   7.31%
(Libor + 4.50%/Q)
    3/14/2017     3.0     2.9 (2)(14)      
        First lien senior secured loan ($3.2 par due 9/2021)   7.31%
(Libor + 4.50%/Q)
    3/14/2017     2.9     3.1 (2)(14)      
                        5.9     6.0        
                                       
GHX Ultimate Parent Corporation, Commerce Parent, Inc. and Commerce Topco, LLC   On-demand supply chain automation solutions provider to the healthcare industry   Second lien senior secured loan ($34.5 par due 6/2025)   10.81%
(Libor + 8.00%/Q)
    6/30/2017     34.2     34.5 (2)(14)      
        Series A preferred stock (110,425 shares)   13.55% PIK
(Libor + 10.75%/Q)
    6/30/2017     133.5     133.5 (2)(14)      
        Class A units (14,013,303 units)         6/30/2017     14.0     16.9 (2)      
                        181.7     184.9        
                                       
Greenphire, Inc. and RMCF III CIV XXIX, L.P   Software provider for clinical trial management   Limited partnership interest (99.90% interest)         12/19/2014     1.0     3.0 (2)      
                                       
Hygiena Borrower LLC(18)   Adenosine triphosphate testing technology provider   First lien senior secured revolving loan       8/26/2016         (16)      
        First lien senior secured loan ($9.5 par due 8/2022)   6.80%
(Libor + 4.00%/Q)
    6/29/2018     9.5     9.4 (2)(14)      
        Second lien senior secured loan ($11.1 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    6/29/2018     11.1     11.0 (2)(14)      
        Second lien senior secured loan ($0.6 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    6/29/2018     0.6     0.6 (2)(14)      
        Second lien senior secured loan ($10.0 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    8/26/2016     10.0     9.9 (2)(14)      
        Second lien senior secured loan ($10.7 par due 8/2023)   10.55%
(Libor + 7.75%/Q)
    2/27/2017     10.7     10.6 (2)(14)      
                        41.9     41.5        
                                       
JDC Healthcare Management, LLC(18)   Dental services provider   First lien senior secured revolving loan ($0.8 par due 4/2022)   12.25%
(Base Rate + 6.75%/Q)
    4/10/2017     0.8     0.8 (2)(14)      
        First lien senior secured loan ($4.1 par due 4/2023)   10.01%
(Libor + 7.75%/A)
    4/10/2017     4.1     4.1 (2)(14)      
        First lien senior secured loan ($9.9 par due 4/2023)   10.27%
(Libor + 7.75%/M)
    4/10/2017     9.9     9.7 (2)(14)      
        First lien senior secured loan ($19.7 par due 4/2023)   10.27%
(Libor + 7.75%/M)
    4/10/2017     19.7     19.3 (4)(14)      
                        34.5     33.9        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
KBHS Acquisition, LLC (d/b/a Alita Care, LLC)(18)   Provider of behavioral health services   First lien senior secured revolving loan ($0.2 par due 3/2022)   7.38%
(Libor + 5.00%/M)
    3/17/2017     0.2     0.2 (2)(14)      
        First lien senior secured revolving loan ($0.3 par due 3/2022)   7.42%
(Libor + 5.00%/M)
    3/17/2017     0.3     0.3 (2)(14)      
        First lien senior secured revolving loan ($0.8 par due 3/2022)   7.46%
(Libor + 5.00%/M)
    3/17/2017     0.8     0.8 (2)(14)      
        First lien senior secured revolving loan ($0.6 par due 3/2022)   7.47%
(Libor + 5.00%/M)
    3/17/2017     0.6     0.6 (2)(14)      
        First lien senior secured revolving loan ($0.3 par due 3/2022)   7.50%
(Libor + 5.00%/M)
    3/17/2017     0.3     0.3 (2)(14)      
        First lien senior secured revolving loan ($0.3 par due 3/2022)   7.43%
(Libor + 5.00%/M)
    3/17/2017     0.3     0.3 (2)(14)      
        First lien senior secured revolving loan ($2.1 par due 3/2022)   7.52%
(Libor + 5.00%/M)
    3/17/2017     2.1     2.0 (2)(14)      
                        4.6     4.5        
                                       
Key Surgical LLC(18)   Provider of sterile processing, operating room and instrument care supplies for hospitals   First lien senior secured loan ($17.0 par due 6/2023)   5.75%
(EURIBOR + 4.75%/Q)
    6/1/2017     16.6     17.0 (2)(14)      
        First lien senior secured loan ($9.3 par due 6/2023)   7.28%
(Libor + 4.75%/Q)
    10/31/2018     9.3     9.3 (2)(14)      
                        25.9     26.3        
                                       
MB2 Dental Solutions, LLC(18)   Dental services provider   First lien senior secured revolving loan ($2.7 par due 9/2023)   9.25%
(Base Rate + 3.75%/Q)
    9/29/2017     2.7     2.7 (2)(14)      
        First lien senior secured loan ($5.8 par due 9/2023)   7.57%
(Libor + 4.75%/Q)
    9/29/2017     5.8     5.8 (2)(14)      
                        8.5     8.5        
                                       
MCH Holdings, Inc. and MC Acquisition Holdings I, LLC   Healthcare professional provider   First lien senior secured loan ($25.7 par due 1/2020)   7.96%
(Libor + 5.50%/M)
    7/26/2017     25.7     25.7 (2)(14)      
        First lien senior secured loan ($26.2 par due 1/2020)   8.02%
(Libor + 5.50%/M)
    7/26/2017     26.2     26.2 (2)(14)      
        First lien senior secured loan ($39.6 par due 1/2020)   7.96%
(Libor + 5.50%/M)
    7/26/2017     39.6     39.6 (3)(14)      
        First lien senior secured loan ($40.5 par due 1/2020)   8.02%
(Libor + 5.50%/M)
    7/26/2017     40.5     40.5 (3)(14)      
        First lien senior secured loan ($9.0 par due 1/2020)   7.96%
(Libor + 5.50%/M)
    7/26/2017     9.0     9.0 (4)(14)      
        First lien senior secured loan ($9.2 par due 1/2020)   8.02%
(Libor + 5.50%/M)
    7/26/2017     9.2     9.2 (4)(14)      
        Class A units (1,438,643 shares)         1/17/2014     1.5     1.2 (2)      
                        151.7     151.4        
                                       
MW Dental Holding Corp.(18)   Dental services provider   First lien senior secured revolving loan ($7.0 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    4/12/2011     7.0     7.0 (2)(14)      
        First lien senior secured loan ($16.9 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    3/19/2018     16.9     16.9 (2)(14)      
        First lien senior secured loan ($104.5 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    4/12/2011     104.5     104.5 (3)(14)      
        First lien senior secured loan ($19.1 par due 4/2021)   9.27%
(Libor + 6.75%/Q)
    4/12/2011     19.1     19.1 (4)(14)      
                        147.5     147.5        
                                       
My Health Direct, Inc.   Healthcare scheduling exchange software solution provider   Warrant to purchase up to 4,548 shares of Series D preferred stock (expires 9/2024)         9/18/2014         (2)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
New Trident Holdcorp, Inc. and Trident Holding Company, LLC   Outsourced mobile diagnostic healthcare service provider   Second lien senior secured loan ($24.9 par due 7/2022)         8/1/2013     19.4     5.0 (2)(13)      
        Second lien senior secured loan ($78.4 par due 7/2020)         8/1/2013     67.8     (2)(13)      
        Senior subordinated loan ($9.1 par due 7/2020)         11/29/2017     8.8     (2)(13)      
                        96.0     5.0        
                                       
NMC Skincare Intermediate Holdings II, LLC(18)   Developer, manufacturer and marketer of skincare products   First lien senior secured loan ($24.9 par due 10/2024)   7.27%
(Libor + 4.75%/M)
    10/31/2018     24.9     24.6 (3)(14)      
                                       
NMN Holdings III Corp. and NMN Holdings LP(18)   Provider of complex rehab technology solutions for patients with mobility loss   Partnership units (30,000 units)         11/13/2018     3.0     2.9 (2)      
                                       
NMSC Holdings, Inc. and ASP NAPA Holdings, LLC   Anesthesia management services provider   Second lien senior secured loan ($72.8 par due 10/2023)   12.59%
(Libor + 10.00%/Q)
    4/19/2016     72.8     71.3 (2)(14)      
        Class A units (25,277 units)         4/19/2016     2.5     1.2 (2)      
                        75.3     72.5        
                                       
Nodality, Inc.   Biotechnology company   First lien senior secured loan ($3.1 par due 8/2016)         11/12/2015     2.1     (2)(13)      
        First lien senior secured loan ($14.7 par due 8/2016)         4/25/2014     9.7     (2)(13)      
        Warrant to purchase up to 3,736,255 shares of common stock (expires 3/2026)         5/1/2016         (2)      
                        11.8            
                                       
NSM Sub Holdings Corp.(18)   Provider of customized mobility, rehab and adaptive seating systems   First lien senior secured loan ($0.2 par due 10/2022)   6.66%
(Libor + 4.25%/Q)
    6/1/2018     0.2     0.2 (2)(14)      
        First lien senior secured loan ($0.4 par due 10/2022)   6.73%
(Libor + 4.25%/Q)
    6/1/2018     0.4     0.4 (2)(14)      
        First lien senior secured loan ($4.9 par due 10/2022)   7.05%
(Libor + 4.25%/Q)
    6/1/2018     4.9     4.9 (2)(14)      
                        5.5     5.5        
                                       
nThrive, Inc. (fka Precyse Acquisition Corp.)   Provider of healthcare information management technology and services   Second lien senior secured loan ($10.0 par due 4/2023)   12.27%
(Libor + 9.75%/M)
    4/20/2016     9.8     9.8 (2)(14)      
                                       
NueHealth Performance, LLC(18)   Developer, builder and manager of specialty surgical hospitals and ambulatory surgery centers   First lien senior secured loan ($1.5 par due 9/2023)   9.02%
(Libor + 6.50%/M)
    9/27/2018     1.5     1.5 (2)(14)      
        First lien senior secured loan ($10.0 par due 9/2023)   9.02%
(Libor + 6.50%/M)
    9/27/2018     10.0     10.0 (2)(14)      
                        11.5     11.5        
                                       
OmniSYS Acquisition Corporation, OmniSYS, LLC, and OSYS Holdings, LLC   Provider of technology-enabled solutions to pharmacies   Limited liability company membership interest (1.57%)         11/21/2013     1.0     0.8 (2)      
                                     

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Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Pathway Vet Alliance LLC(18)   Operator of freestanding veterinary hospitals   First lien senior secured loan ($264.5 par due 12/2024)   6.98%
(Libor + 4.50%/M)
    12/21/2018     261.8     261.8 (2)(14)      
        Second lien senior secured loan ($175.1 par due 12/2025)   10.98%
(Libor + 8.50%/Q)
    12/21/2018     175.1     173.4 (2)(14)      
        Preferred subscription units (1,507,384 units)         12/21/2018     4.9     4.9        
                        441.8     440.1        
                                       
Patterson Medical Supply, Inc.   Distributor of rehabilitation supplies and equipment   Second lien senior secured loan ($78.0 par due 8/2023)   11.03%
(Libor + 8.50%/Q)
    9/2/2015     76.7     67.9 (2)(14)      
                                       
PhyMED Management LLC   Provider of anesthesia services   Second lien senior secured loan ($47.2 par due 5/2021)   11.46%
(Libor + 8.75%/Q)
    12/18/2015     46.9     47.2 (2)(14)      
                                       
Practice Insight, LLC(18)   Revenue cycle management provider to the emergency healthcare industry   First lien senior secured loan ($12.4 par due 8/2022)   7.52%
(Libor + 5.00%/M)
    8/23/2017     12.4     12.4 (4)(14)      
                                       
Premise Health Holding Corp. and OMERS Bluejay Investment Holdings LP(18)   Provider of employer-sponsored onsite health and wellness clinics and pharmacies   First lien senior secured revolving loan ($6.0 par due 7/2023)   6.09%
(Libor + 3.50%/S)
    7/10/2018     6.0     5.9 (2)(14)      
        First lien senior secured loan ($0.8 par due 7/2025)   6.55%
(Libor + 3.75%/Q)
    7/10/2018     0.8     0.8 (2)(14)      
        First lien senior secured loan ($20.0 par due 7/2025)   6.55%
(Libor + 3.75%/Q)
    7/10/2018     19.9     19.8 (4)(14)      
        Second lien senior secured loan ($67.1 par due 7/2026)   10.30%
(Libor + 7.50%/Q)
    7/10/2018     66.5     66.1 (2)(14)      
        Class A units (9,775 units)         7/10/2018     9.8     9.8 (2)      
                        103.0     102.4        
                                       
ProVation Medical, Inc.   Provider of documentation and coding software for GI physicians   First lien senior secured loan ($13.0 par due 3/2024)   9.42%
(Libor + 7.00%/Q)
    3/9/2018     12.8     13.0 (2)(14)      
                                       
RecoveryDirect Acquisition, L.L.C.(18)   Outpatient physical therapy provider   First lien senior secured loan ($6.9 par due 1/2024)   6.77%
(Libor + 4.25%/M)
    1/3/2018     6.9     6.9 (2)(14)      
        First lien senior secured loan ($14.8 par due 1/2024)   6.77%
(Libor + 4.25%/M)
    1/3/2018     14.8     14.8 (2)(14)      
        First lien senior secured loan ($19.8 par due 1/2024)   6.77%
(Libor + 4.25%/M)
    1/3/2018     19.8     19.8 (4)(14)      
                        41.5     41.5        
                                       
Respicardia, Inc.   Developer of implantable therapies to improve cardiovascular health   Warrant to purchase up to 99,094 shares of Series C preferred stock (expires 6/2022)         6/28/2012         (2)      
                                       
Salter Labs(18)   Developer, manufacturer and supplier of consumable products for medical device customers   First lien senior secured revolving loan ($0.6 par due 3/2020)   6.76%
(Libor + 4.25%/Q)
    2/8/2018     0.6     0.6 (2)(14)(17)      
        First lien senior secured revolving loan ($0.4 par due 3/2020)   7.05%
(Libor + 4.25%/Q)
    2/8/2018     0.4     0.4 (2)(14)(17)      
                        1.0     1.0        
                                       
SCSG EA Acquisition Company, Inc.(18)   Provider of outsourced clinical services to hospitals and health systems   First lien senior secured revolving loan       9/1/2017         (16)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
SiroMed Physician Services, Inc. and SiroMed Equity Holdings, LLC(18)   Outsourced anesthesia provider   First lien senior secured loan ($17.4 par due 3/2024)   7.55%
(Libor + 4.75%/Q)
    3/26/2018     17.4     17.1 (3)(14)      
        Common units (171,784 units)         3/26/2018     4.6     3.2 (2)      
                        22.0     20.3        
                                       
SM Wellness Holdings, Inc. and SM Holdco, Inc.(18)   Breast cancer screening provider   First lien senior secured loan ($0.7 par due 8/2024)   8.02%
(Libor + 5.50%/M)
    8/1/2018     0.7     0.7 (2)(14)      
        First lien senior secured loan ($7.1 par due 8/2024)   8.02%
(Libor + 5.50%/M)
    8/1/2018     7.1     7.1 (2)(14)      
        Series A preferred stock (44,975 shares)   13.05%
(Libor + 10.25%/Q)
    8/1/2018     47.4     47.4 (2)(14)      
        Series A units (7,475 units)         8/1/2018     7.5     0.1 (2)      
        Series B units (747,500 units)         8/1/2018         7.4 (2)      
                        62.7     62.7        
                                       
Synergy HomeCare Franchising, LLC and NP/Synergy Holdings, LLC(18)   Franchisor of private-pay home care for the elderly   First lien senior secured loan ($16.0 par due 4/2024)   8.55%
(Libor + 5.75%/Q)
    4/2/2018     16.0     16.0 (2)(14)      
        Common units (550 units)         4/2/2018     0.6     0.7        
                        16.6     16.7        
                                       
Teligent, Inc.(18)   Pharmaceutical company that develops, manufactures and markets injectable pharmaceutical products   Second lien senior secured loan ($18.3 par due 6/2024)   13.25%
(Base Rate + 7.75%/Q)
    12/13/2018     18.3     18.1 (2)(14)      
        Second lien senior secured loan ($45.5 par due 6/2024)   11.53%
(Libor + 8.75%/Q)
    12/13/2018     45.5     45.0 (2)(14)      
                        63.8     63.1        
                                       
TerSera Therapeutics LLC   Acquirer and developer of specialty therapeutic pharmaceutical products   First lien senior secured loan ($2.2 par due 3/2024)   8.06%
(Libor + 5.25%/Q)
    7/12/2018     2.2     2.2 (2)(14)      
        First lien senior secured loan ($2.2 par due 3/2024)   8.05%
(Libor + 5.25%/Q)
    7/12/2018     2.2     2.2 (2)(14)      
        First lien senior secured loan ($2.1 par due 3/2023)   8.05%
(Libor + 5.25%/Q)
    9/27/2018     2.1     2.1 (2)(14)      
        First lien senior secured loan ($5.2 par due 3/2023)   8.05%
(Libor + 5.25%/Q)
    5/3/2017     5.2     5.2 (4)(14)      
                        11.7     11.7        
                                       
U.S. Anesthesia Partners, Inc.   Anesthesiology service provider   Second lien senior secured loan ($71.8 par due 6/2025)   9.77%
(Libor + 7.25%/M)
    6/16/2017     70.9     70.4 (2)(14)      
                                       
United Digestive MSO Parent, LLC(18)   Gastroenterology physician group   First lien senior secured loan ($12.6 par due 12/2024)   7.02%
(Libor + 4.50%/M)
    12/14/2018     12.6     12.5 (2)(14)      
                                       
Urgent Cares of America Holdings I, LLC and FastMed Holdings I, LLC(18)   Operator of urgent care clinics   Preferred units (7,696,613 units)         6/11/2015     7.7     5.4        
        Series A common units (2,000,000 units)         6/11/2015     2.0            
        Series C common units (5,288,427 units)         6/11/2015                
                        9.7     5.4        
                                       
Urology Management Associates, LLC and JWC/UMA Holdings, L.P.   Urology private practice   First lien senior secured loan ($9.8 par due 8/2024)   7.52%
(Libor + 5.00%/M)
    8/31/2018     9.7     9.8 (2)(14)      
        Limited partnership interests (3.64% interest)         8/31/2018     4.8     4.8 (2)      
                        14.5     14.6        
                                       
Verscend Holding Corp.(18)   Healthcare analytics solutions provider   First lien senior secured loan ($99.8 par due 8/2025)   7.02%
(Libor + 4.50%/M)
    8/27/2018     99.0     97.8 (2)(14)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
VistaPharm, Inc. and Vertice Pharma UK Parent Limited   Manufacturer and distributor of generic pharmaceutical products   Preferred shares (40,662 shares)         12/21/2015     0.3     0.6 (8)      
                                       
West Dermatology, LLC(18)   Dermatology practice platform   First lien senior secured revolving loan ($0.7 par due 4/2022)   7.93%
(Libor + 5.50%/Q)
    2/8/2018     0.7     0.7 (2)(14)      
        First lien senior secured revolving loan ($0.6 par due 4/2022)   8.21%
(Libor + 5.50%/Q)
    2/8/2018     0.6     0.6 (2)(14)      
        First lien senior secured revolving loan ($3.7 par due 4/2022)   8.31%
(Libor + 5.50%/Q)
    2/8/2018     3.7     3.7 (2)(14)      
        First lien senior secured loan ($1.4 par due 4/2023)   7.90%
(Libor + 5.50%/Q)
    4/2/2018     1.4     1.4 (2)(14)      
        First lien senior secured loan ($0.3 par due 4/2023)   7.91%
(Libor + 5.50%/Q)
    4/2/2018     0.3     0.3 (2)(14)      
        First lien senior secured loan ($0.9 par due 4/2023)   7.94%
(Libor + 5.50%/Q)
    4/2/2018     0.9     0.9 (2)(14)      
        First lien senior secured loan ($0.1 par due 4/2023)   8.11%
(Libor + 5.50%/Q)
    4/2/2018     0.1     0.1 (2)(14)      
        First lien senior secured loan ($1.3 par due 4/2023)   8.21%
(Libor + 5.50%/Q)
    4/2/2018     1.3     1.3 (2)(14)      
        First lien senior secured loan ($0.8 par due 4/2023)   8.26%
(Libor + 5.50%/Q)
    4/2/2018     0.8     0.8 (2)(14)      
        First lien senior secured loan ($4.1 par due 4/2023)   8.31%
(Libor + 5.50%/Q)
    4/2/2018     4.1     4.1 (2)(14)      
        First lien senior secured loan ($1.3 par due 4/2023)   8.21%
(Libor + 5.50%/Q)
    9/5/2018     1.3     1.3 (2)(14)      
        First lien senior secured loan ($7.7 par due 4/2023)   8.31%
(Libor + 5.50%/Q)
    4/2/2018     7.7     7.7 (2)(14)      
                        22.9     22.9        
                                       
WIRB—Copernicus Group, Inc.(18)   Provider of regulatory, ethical, and safety review services for clinical research involving human subjects   First lien senior secured revolving loan       2/8/2018         (16)      
                                       
WSHP FC Acquisition LLC(18)   Provider of biospecimen products   First lien senior secured revolving loan ($2.5 par due 3/2024)   9.30%
(Libor + 6.50%/Q)
    3/30/2018     2.5     2.5 (2)(14)      
        First lien senior secured revolving loan ($0.8 par due 3/2024)   9.32%
(Libor + 6.50%/Q)
    3/30/2018     0.8     0.8 (2)(14)      
        First lien senior secured loan ($6.0 par due 3/2024)   9.32%
(Libor + 6.50%/Q)
    3/30/2018     6.0     6.0 (2)(14)      
        First lien senior secured loan ($28.5 par due 3/2024)   9.30%
(Libor + 6.50%/Q)
    3/30/2018     28.5     28.5 (3)(14)      
                        37.8     37.8        
                        2,850.0     2,696.1     36.95 %
                                       
Business Services                                      
                                       
Accommodations Plus Technologies LLC and Accommodations Plus Technologies Holdings LLC(18)   Provider of outsourced crew accommodations and logistics management solutions to the airline industry   First lien senior secured loan ($12.5 par due 5/2024)   7.62%
(Libor + 5.00%/S)
    5/11/2018     12.5     12.5 (2)(14)      
        Class A common units (236,358 units)         5/11/2018     4.5     6.4        
                        17.0     18.9        
                                       
Achilles Acquisition LLC(18)   Benefits broker and outsourced workflow automation platform provider for brokers   First lien senior secured loan ($16.7 par due 10/2025)   6.56%
(Libor + 4.00%/M)
    10/11/2018     16.7     16.7 (2)(14)      
        First lien senior secured loan ($21.4 par due 10/2025)   6.56%
(Libor + 4.00%/M)
    10/11/2018     21.4     21.3 (2)(14)      
                        38.1     38.0        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Blue Campaigns Intermediate Holding Corp. and Elevate Parent, Inc. (dba EveryAction)(18)   Provider of fundraising and organizing efforts and digital services to non-profits and political campaigns   First lien senior secured loan ($27.5 par due 8/2023)   9.40%
(Libor + 6.75%/Q)
    8/20/2018     27.5     27.4 (2)(14)      
        Series A preferred stock (150,000 shares)         9/26/2018     1.5     1.5        
                        29.0     28.9        
                                       
CallMiner, Inc.   Provider of cloud-based conversational analytics solutions   Warrant to purchase up to 2,350,636 shares of Series 1 preferred stock (expires 7/2024)         7/23/2014         (2)      
                                       
Chesapeake Research Review, LLC and Schulman Associates Institutional Review Board, Inc.(18)   Provider of central institutional review boards over clinical trials   First lien senior secured loan ($15.8 par due 11/2023)   8.55%
(Libor + 5.75%/Q)
    11/7/2017     15.8     15.8 (2)(14)      
                                       
CMW Parent LLC (fka Black Arrow, Inc.)   Multiplatform media firm   Series A units (32 units)         9/11/2015         (2)      
                                       
Command Alkon Incorporated(18)   Software solutions provider to the ready-mix concrete industry   First lien senior secured revolving loan ($2.9 par due 9/2022)   9.50%
(Base Rate + 4.00%/M)
    9/1/2017     2.9     2.9 (2)(14)(17)      
        First lien senior secured loan ($20.4 par due 9/2023)   7.35%
(Libor + 5.00%/M)
    9/1/2017     20.4     20.2 (2)(14)      
        Second lien senior secured loan ($33.8 par due 3/2024)   11.35%
(Libor + 9.00%/M)
    9/1/2017     33.8     33.1 (2)(14)      
                        57.1     56.2        
                                       
Compusearch Software Systems, Inc.   Provider of enterprise software and services for organizations in the public sector   Second lien senior secured loan ($51.0 par due 11/2021)   11.36%
(Libor + 8.75%/Q)
    1/3/2017     51.0     51.0 (3)(14)      
                                       
Compuware Parent, LLC   Web and mobile cloud performance testing and monitoring services provider   Class A-1 common stock (4,132 units)         12/15/2014     2.3     2.6 (2)      
        Class B-1 common stock (4,132 units)         12/15/2014     0.5     0.5 (2)      
        Class C-1 common stock (4,132 units)         12/15/2014     0.3     0.3 (2)      
        Class A-2 common stock (4,132 units)         12/15/2014         (2)      
        Class B-2 common stock (4,132 units)         12/15/2014         (2)      
        Class C-2 common stock (4,132 units)         12/15/2014         (2)      
                        3.1     3.4        
                                       
Directworks, Inc. and Co-Exprise Holdings, Inc.   Provider of cloud-based software solutions for direct materials sourcing and supplier management for manufacturers   First lien senior secured loan ($1.8 par due 4/2018)         12/19/2014     1.3     0.2 (2)(13)      
        Warrant to purchase up to 1,875,000 shares of Series 1 preferred stock (expires 12/2024)         12/19/2014         (2)      
                        1.3     0.2        
                                       
Doxim Inc.(8)(18)   Enterprise content management provider   First lien senior secured loan ($3.6 par due 2/2024)   8.79%
(Libor + 6.00%/Q)
    2/28/2018     3.6     3.6 (2)(11)(14)      
        First lien senior secured loan ($10.2 par due 2/2024)   8.80%
(Libor + 6.00%/Q)
    2/28/2018     10.0     10.2 (2)(11)(14)      
                        13.6     13.8        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
DRB Holdings, LLC(18)   Provider of integrated technology solutions to car wash operators   First lien senior secured revolving loan ($3.3 par due 10/2023)   8.78%
(Libor + 6.00%/Q)
    10/6/2017     3.3     3.3 (2)(14)      
        First lien senior secured loan ($23.7 par due 10/2023)   8.80%
(Libor + 6.00%/Q)
    10/6/2017     23.7     23.7 (3)(14)      
                        27.0     27.0        
                                       
DTI Holdco, Inc. and OPE DTI Holdings, Inc.(18)   Provider of legal process outsourcing and managed services   First lien senior secured revolving loan ($0.9 par due 9/2021)   6.93%
(Libor + 4.50%/M)
    9/23/2016     0.9     0.9 (2)(14)      
        First lien senior secured revolving loan ($1.3 par due 9/2021)   6.97%
(Libor + 4.50%/M)
    9/23/2016     1.3     1.3 (2)(14)      
        Class A common stock (7,500 shares)         8/19/2014     7.5     7.4 (2)      
        Class B common stock (7,500 shares)         8/19/2014         (2)      
                        9.7     9.6        
                                       
Emergency Communications Network, LLC(18)   Provider of mission critical emergency mass notification solutions   First lien senior secured loan ($25.1 par due 6/2023)   8.77%
(Libor + 6.25%/M)
    6/1/2017     25.0     24.4 (2)(14)      
        First lien senior secured loan ($19.7 par due 6/2023)   8.77%
(Libor + 6.25%/M)
    6/1/2017     19.6     19.2 (4)(14)      
                        44.6     43.6        
                                       
EN Engineering, L.L.C.(18)   National utility services firm providing engineering and consulting services to natural gas, electric power and other energy and industrial end markets   First lien senior secured loan ($0.3 par due 6/2021)   7.02%
(Libor + 4.50%/M)
    6/30/2015     0.3     0.3 (2)(14)      
        First lien senior secured loan ($6.8 par due 6/2021)   7.02%
(Libor + 4.50%/M)
    6/30/2015     6.8     6.8 (2)(14)      
                        7.1     7.1        
                                       
Entertainment Partners, LLC and Entertainment Partners Canada Inc.(18)   Provider of entertainment workforce and production management solutions   First lien senior secured loan ($1.4 par due 5/2022)   7.77%
(CIBOR + 5.50%/M)
    5/8/2017     1.4     1.4 (2)(8)(14)      
        First lien senior secured loan ($2.6 par due 5/2022)   7.71%
(Libor + 5.50%/M)
    5/8/2017     2.6     2.6 (2)(8)(14)      
        First lien senior secured loan ($2.6 par due 5/2022)   7.85%
(Libor + 5.50%/M)
    5/8/2017     2.6     2.6 (2)(8)(14)      
        First lien senior secured loan ($0.3 par due 5/2023)   8.34%
(Libor + 5.75%/Q)
    5/8/2017     0.3     0.3 (2)(14)      
        First lien senior secured loan ($26.4 par due 5/2023)   8.34%
(Libor + 5.75%/Q)
    5/8/2017     26.4     26.4 (3)(14)      
        First lien senior secured loan ($0.3 par due 5/2023)   8.55%
(Libor + 5.75%/Q)
    5/8/2017     0.3     0.3 (2)(14)      
        First lien senior secured loan ($22.0 par due 5/2023)   8.55%
(Libor + 5.75%/Q)
    5/8/2017     22.0     22.0 (3)(14)      
        First lien senior secured loan ($0.3 par due 5/2023)   8.59%
(Libor + 5.75%/Q)
    5/8/2017     0.3     0.3 (2)(14)      
        First lien senior secured loan ($26.4 par due 5/2023)   8.59%
(Libor + 5.75%/Q)
    5/8/2017     26.4     26.4 (3)(14)      
                        82.3     82.3        
                                       
Episerver Inc. and Goldcup 17308 AB(8)(18)   Provider of web content management and digital commerce solutions   First lien senior secured loan ($27.7 par due 10/2024)   8.27%
(Libor + 5.75%/M)
    10/9/2018     27.7     27.4 (2)(14)      
                                       
First Insight, Inc.   Software company providing merchandising and pricing solutions to companies worldwide   Warrant to purchase up to 122,827 units of Series C preferred stock (expires 3/2024)         3/20/2014         (2)      
                                     

F-204


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Foundation Risk Partners, Corp.(18)   Full service independent insurance agency   First lien senior secured loan ($7.8 par due 11/2023)   7.10%
(Libor + 4.75%/M)
    11/10/2017     7.8     7.8 (2)(14)      
        First lien senior secured loan ($1.0 par due 11/2023)   7.17%
(Libor + 4.75%/Q)
    8/9/2018     1.0     1.0 (2)(14)      
        First lien senior secured loan ($3.4 par due 11/2023)   7.34%
(Libor + 4.75%/Q)
    8/9/2018     3.4     3.4 (2)(14)      
        First lien senior secured loan ($5.2 par due 11/2023)   7.21%
(Libor + 4.75%/Q)
    8/9/2018     5.2     5.2 (2)(14)      
        First lien senior secured loan ($22.3 par due 11/2023)   7.10%
(Libor + 4.75%/M)
    11/10/2017     22.3     22.3 (3)(14)      
        Second lien senior secured loan ($3.0 par due 11/2024)   10.92%
(Libor + 8.50%/Q)
    8/9/2018     3.0     3.0 (2)(14)      
        Second lien senior secured loan ($12.4 par due 11/2024)   11.09%
(Libor + 8.50%/Q)
    8/9/2018     12.4     12.4 (2)(14)      
        Second lien senior secured loan ($19.1 par due 11/2024)   10.96%
(Libor + 8.50%/Q)
    8/9/2018     19.1     19.1 (2)(14)      
        Second lien senior secured loan ($27.5 par due 11/2024)   10.85%
(Libor + 8.50%/M)
    11/10/2017     27.5     27.5 (2)(14)      
                        101.7     101.7        
                                       
Genesis Acquisition Co. and Genesis Holding Co.(18)   Child care management software and services provider   First lien senior secured loan ($5.5 par due 7/2024)   6.52%
(Libor + 4.00%/M)
    7/31/2018     5.5     5.4 (2)(14)      
        Second lien senior secured loan ($25.8 par due 7/2025)   10.02%
(Libor + 7.50%/M)
    7/31/2018     25.8     25.4 (2)(14)      
        Class A common stock (8 shares)         7/31/2018     0.8     0.8 (2)      
                        32.1     31.6        
                                       
GTCR-Ultra Holdings III, LLC and GTCR-Ultra Holdings LLC(18)   Provider of payment processing and merchant acquiring solutions   First lien senior secured loan ($6.5 par due 8/2024)   7.77%
(Libor + 5.25%/M)
    12/31/2018     6.5     6.5 (2)(14)      
        Class A-2 units (911 units)         8/1/2017     0.9     1.3 (2)      
        Class B units (2,878,372 units)         8/1/2017         (2)      
                        7.4     7.8        
                                       
HAI Acquisition Corporation and Aloha Topco, LLC(18)   Professional employer organization offering human resources, compliance and risk management services   First lien senior secured loan ($66.2 par due 11/2024)   8.59%
(Libor + 6.00%/Q)
    11/1/2017     66.2     65.6 (3)(14)      
        Class A units (16,980 units)         11/1/2017     1.7     1.8 (2)      
                        67.9     67.4        
                                       
Help/Systems Holdings, Inc.(18)   Provider of IT operations management and cybersecurity software   First lien senior secured revolving loan ($1.0 par due 3/2023)   6.27%
(Libor + 3.75%/M)
    3/29/2018     1.0     1.0 (2)(14)      
                                       
IfByPhone Inc.   Voice-based marketing automation software provider   Warrant to purchase up to 124,300 shares of Series C preferred stock (expires 10/2022)         10/15/2012     0.1     0.1 (2)      
                                       
Implementation Management Assistance, LLC(18)   Revenue cycle consulting firm to the healthcare industry   First lien senior secured revolving loan ($5.5 par due 12/2023)   9.00%
(Base Rate + 3.50%/Q)
    12/13/2017     5.5     5.5 (2)(14)      
        First lien senior secured loan ($17.0 par due 12/2023)   7.30%
(Libor + 4.50%/Q)
    12/13/2017     17.0     16.8 (2)(14)      
                        22.5     22.3        
                                     

F-205


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Infinite Electronics, Inc.(18)   Manufacturer and distributor of radio frequency and microwave electronic components   First lien senior secured revolving loan       7/2/2018         (16)      
        First lien senior secured loan ($10.3 par due 7/2025)   6.52%
(Libor + 4.00%/M)
    7/2/2018     10.3     10.2 (2)(14)      
                        10.3     10.2        
                                       
Infogix, Inc. and Infogix Parent Corporation(18)   Enterprise data analytics and integrity software solutions provider   Series A preferred stock (2,475 shares)         1/3/2017     2.5     2.5        
        Common stock (1,297,768 shares)         1/3/2017                
                        2.5     2.5        
                                       
Inmar, Inc.   Technology-driven solutions provider for retailers, wholesalers and manufacturers   Second lien senior secured loan ($28.3 par due 5/2025)   10.52%
(Libor + 8.00%/M)
    4/25/2017     27.9     28.3 (2)(14)      
                                       
InterVision Systems, LLC and InterVision Holdings, LLC   Provider of cloud based IT solutions, infrastructure and services   First lien senior secured loan ($16.4 par due 5/2022)   10.55%
(Libor + 8.08%/M)
    5/31/2017     16.4     15.9 (2)(14)      
        First lien senior secured loan ($24.7 par due 5/2022)   10.24%
(Libor + 7.72%/M)
    5/31/2017     24.7     24.0 (2)(14)      
        First lien senior secured loan ($10.0 par due 5/2022)   10.24%
(Libor + 7.72%/M)
    5/31/2017     10.0     9.7 (4)(14)      
        Class A membership units (1,000 units)         5/31/2017     1.0     0.6        
                        52.1     50.2        
                                       
iParadigms Holdings, LLC   Anti-plagiarism software provider to the education market   Second lien senior secured loan ($32.5 par due 7/2022)   10.05%
(Libor + 7.25%/Q)
    1/3/2017     32.0     32.5 (2)(14)      
                                       
iPipeline, Inc., Internet Pipeline, Inc., iPipeline Limited and iPipeline Holdings, Inc.(18)   Provider of SaaS-based software solutions to the insurance and financial services industry   First lien senior secured loan ($11.2 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    12/18/2017     11.8     11.2 (2)(8)(14)      
        First lien senior secured loan ($7.4 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    6/15/2017     7.4     7.4 (2)(14)      
        First lien senior secured loan ($9.0 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    9/15/2017     9.0     9.0 (2)(14)      
        First lien senior secured loan ($16.2 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    8/4/2015     16.2     16.2 (3)(14)      
        First lien senior secured loan ($14.5 par due 8/2022)   7.28%
(Libor + 4.75%/M)
    8/4/2015     14.5     14.5 (4)(14)      
        Preferred stock (1,100 shares)         8/4/2015     1.1     4.3 (2)      
        Common stock (668,781 shares)         8/4/2015         (2)      
                        60.0     62.6        
                                       
IQMS   Provider of enterprise resource planning and manufacturing execution software for small and midsized manufacturers   First lien senior secured loan ($22.5 par due 3/2022)   12.75%
(Base Rate + 7.25%/Q)
    3/28/2017     22.5     22.5 (3)(14)      
        First lien senior secured loan ($14.9 par due 3/2022)   12.75%
(Base Rate + 7.25%/Q)
    3/28/2017     14.9     14.9 (4)(14)      
                        37.4     37.4        
                                     

F-206


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
IRI Holdings, Inc., IRI Group Holdings, Inc. and IRI Parent, L.P.   Market research company focused on the consumer packaged goods industry   First lien senior secured loan ($79.0 par due 11/2025)   7.02%
(Libor + 4.50%/M)
    11/30/2018     78.2     77.4 (2)(14)      
        Second lien senior secured loan ($86.8 par due 11/2026)   10.52%
(Libor + 8.00%/M)
    11/30/2018     85.3     85.1 (2)(14)      
        Series A-1 preferred shares (46,900 shares)   13.39%
PIK (Libor + 10.50%/S)
    11/30/2018     46.2     46.9 (2)(14)      
        Class A-1 common units (90,500 units)         11/30/2018     9.1     9.1 (2)      
                        218.8     218.5        
                                       
Kaufman, Hall & Associates, LLC(18)   Provider of specialty advisory services and software solutions to the healthcare market   First lien senior secured loan ($25.0 par due 5/2025)   7.64%
(Libor + 5.25%/M)
    11/9/2018     25.0     24.8 (2)(14)      
                                       
Labstat International Inc.(8)(18)   Lab testing services for nicotine containing products   First lien senior secured loan ($5.0 par due 6/2024)   8.55%
(CIBOR + 6.25%/Q)
    10/19/2018     5.2     5.0 (2)(14)      
        First lien senior secured loan ($19.2 par due 6/2024)   8.55%
(CIBOR + 6.25%/Q)
    6/25/2018     19.8     19.2 (2)(14)      
                        25.0     24.2        
                                       
LLSC Holdings Corporation (dba Lawrence Merchandising Services) (7)   Marketing services provider   Series A preferred stock (9,000 shares)         1/3/2017     1.8     0.4        
        Common stock (1,000 shares)         1/3/2017                
                        1.8     0.4        
                                       
Masergy Holdings, Inc.(18)   Provider of software-defined solutions for enterprise global networks, cyber security, and cloud communications   First lien senior secured revolving loan ($0.2 par due 12/2021)   6.02%
(Libor + 3.50%/M)
    2/8/2018     0.2     0.1 (2)(14)(17)      
                                       
Ministry Brands, LLC and MB Parent HoldCo, L.P. (dba Community Brands)(18)   Software and payment services provider to faith-based institutions   First lien senior secured loan ($4.9 par due 12/2022)   6.52%
(Libor + 4.00%/M)
    8/22/2017     4.9     4.9 (2)(14)      
        First lien senior secured loan ($10.5 par due 12/2022)   6.52%
(Libor + 4.00%/M)
    4/6/2017     10.5     10.5 (2)(14)      
        First lien senior secured loan ($14.5 par due 12/2022)   6.52%
(Libor + 4.00%/M)
    4/6/2017     14.4     14.5 (2)(14)      
        Second lien senior secured loan ($16.6 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    12/2/2016     16.6     16.6 (2)(14)      
        Second lien senior secured loan ($17.9 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    8/22/2017     17.9     17.9 (2)(14)      
        Second lien senior secured loan ($4.7 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    4/6/2017     4.7     4.7 (2)(14)      
        Second lien senior secured loan ($7.0 par due 6/2023)   10.52%
(Libor + 8.00%/M)
    4/18/2018     7.0     7.0 (2)(14)      
        Second lien senior secured loan ($9.2 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    4/6/2017     9.2     9.2 (2)(14)      
        Second lien senior secured loan ($38.6 par due 6/2023)   10.52%
(Libor + 8.00%/M)
    4/18/2018     38.6     38.6 (2)(14)      
        Second lien senior secured loan ($75.0 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    12/2/2016     74.5     75.0 (2)(14)      
        Second lien senior secured loan ($15.0 par due 6/2023)   11.77%
(Libor + 9.25%/M)
    12/2/2016     14.9     15.0 (3)(14)      
        Class A units (500,000 units)         12/2/2016     5.0     6.8 (2)      
                        218.2     220.7        
                                       
MVL Group, Inc.(7)   Marketing research provider   Common stock (560,716 shares)         4/1/2010         (2)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
NAS, LLC, Nationwide Marketing Group, LLC and Nationwide Administrative Services, Inc.   Buying and marketing services organization for appliance, furniture and consumer electronics dealers   Second lien senior secured loan ($24.1 par due 12/2021)   11.15%
(Libor + 8.75%/Q)
    6/1/2015     24.1     24.1 (2)(14)      
        Second lien senior secured loan ($7.0 par due 12/2021)   11.14%
(Libor + 8.75%/Q)
    6/1/2015     7.0     7.0 (2)(14)      
                        31.1     31.1        
                                       
Novetta Solutions, LLC   Provider of advanced analytics solutions for the government, defense and commercial industries   First lien senior secured loan ($8.6 par due 10/2022)   7.53%
(Libor + 5.00%/M)
    1/3/2017     8.4     8.4 (2)(14)      
        Second lien senior secured loan ($31.0 par due 10/2023)   11.03%
(Libor + 8.50%/M)
    1/3/2017     28.8     28.5 (2)(14)      
                        37.2     36.9        
                                       
NSM Insurance Group, LLC   Insurance program administrator   First lien senior secured loan ($6.7 par due 5/2024)   7.30%
(Libor + 4.50%/Q)
    5/11/2018     6.7     6.7 (2)(14)      
        First lien senior secured loan ($10.2 par due 5/2024)   7.30%
(Libor + 4.50%/Q)
    12/3/2018     10.2     10.2 (2)(14)      
        First lien senior secured loan ($13.1 par due 5/2024)   7.30%
(Libor + 4.50%/Q)
    5/11/2018     13.1     13.1 (3)(14)      
                        30.0     30.0        
                                       
PayNearMe, Inc.   Electronic cash payment system provider   Warrant to purchase up to 195,726 shares of Series E preferred stock (expires 3/2023)         3/11/2016     0.2     (2)      
                                       
PDI TA Holdings, Inc.(18)   Provider of enterprise management software for the convenience retail and petroleum wholesale markets   First lien senior secured loan ($5.0 par due 10/2024)   6.90%
(Libor + 4.50%/Q)
    4/11/2018     5.0     5.0 (2)(14)      
        First lien senior secured loan ($0.4 par due 10/2024)   7.21%
(Libor + 4.50%/Q)
    4/11/2018     0.4     0.4 (2)(14)      
        First lien senior secured loan ($5.1 par due 10/2024)   6.92%
(Libor + 4.50%/Q)
    8/25/2017     5.1     5.1 (2)(14)      
        First lien senior secured loan ($2.7 par due 10/2024)   7.04%
(Libor + 4.50%/Q)
    8/25/2017     2.7     2.7 (2)(14)      
        First lien senior secured loan ($23.4 par due 10/2024)   7.30%
(Libor + 4.50%/Q)
    8/25/2017     23.4     23.4 (2)(14)      
        First lien senior secured loan ($4.3 par due 10/2024)   6.11%
(Libor + 4.50%/Q)
    10/24/2018     4.3     4.3 (2)(14)      
        First lien senior secured loan ($45.0 par due 10/2024)   7.23%
(Libor + 4.75%/Q)
    10/24/2018     45.0     45.0 (2)(14)      
        Second lien senior secured loan ($8.2 par due 10/2025)   11.04%
(Libor + 8.50%/Q)
    8/25/2017     8.2     8.2 (2)(14)      
        Second lien senior secured loan ($6.5 par due 10/2025)   10.91%
(Libor + 8.50%/Q)
    8/25/2017     6.5     6.5 (2)(14)      
        Second lien senior secured loan ($1.9 par due 10/2025)   10.98%
(Libor + 8.50%/Q)
    8/25/2017     1.9     1.9 (2)(14)      
        Second lien senior secured loan ($23.2 par due 10/2025)   11.00%
(Libor + 8.50%/Q)
    8/25/2017     23.2     23.2 (2)(14)      
        Second lien senior secured loan ($6.4 par due 10/2025)   11.11%
(Libor + 8.50%/Q)
    10/24/2018     6.4     6.4 (2)(14)      
        Second lien senior secured loan ($52.9 par due 10/2025)   10.99%
(Libor + 8.50%/Q)
    10/24/2018     52.9     52.9 (2)(14)      
        Second lien senior secured loan ($16.7 par due 10/2025)   11.17%
(Libor + 8.75%/Q)
    4/11/2018     16.7     16.7 (2)(14)      
        Second lien senior secured loan ($66.8 par due 10/2025)   11.21%
(Libor + 8.50%/Q)
    8/25/2017     66.8     66.8 (2)(14)      
                        268.5     268.5        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
PHL Investors, Inc., and PHL Holding Co.(7)   Mortgage services   Class A common stock (576 shares)         7/31/2012     3.8     (2)      
                                       
PHNTM Holdings, Inc. and Planview Parent, Inc.   Provider of project and portfolio management software   First lien senior secured loan ($1.4 par due 1/2023)   7.77%
(Libor + 5.25%/M)
    1/27/2017     1.4     1.4 (2)(14)      
        Second lien senior secured loan ($62.0 par due 7/2023)   12.27%
(Libor + 9.75%/M)
    1/27/2017     61.3     62.0 (2)(14)      
        Class A common shares (990 shares)         1/27/2017     1.0     1.1 (2)      
        Class B common shares (168,329 shares)         1/27/2017         0.2 (2)      
                        63.7     64.7        
                                       
Poplicus Incorporated   Business intelligence and market analytics platform for companies that sell to the public sector   Warrant to purchase up to 2,402,991 shares of Series C preferred stock (expires 6/2025)         6/25/2015     0.1     (2)      
                                       
Production Resource Group, L.L.C.   Provider of rental equipment, labor, production management, scenery, and other products to various entertainment end-markets   First lien senior secured loan ($21.0 par due 8/2024)   9.65%
(Libor + 7.00%/Q)
    8/21/2018     21.0     20.6 (2)(14)      
        First lien senior secured loan ($80.0 par due 8/2024)   9.65%
(Libor + 7.00%/Q)
    8/21/2018     80.0     78.4 (3)(14)      
                        101.0     99.0        
                                       
Project Alpha Intermediate Holding, Inc. and Qlik Parent, Inc.   Provider of data visualization software for data analytics   Class A common shares (7,445 shares)         8/22/2016     7.4     9.6 (2)      
        Class B common shares (1,841,609 shares)         8/22/2016     0.1     0.1 (2)      
                        7.5     9.7        
                                       
R2 Acquisition Corp.   Marketing services   Common stock (250,000 shares)         5/29/2007     0.3     0.2 (2)      
SCM Insurance Services Inc.(8)(18)   Provider of claims management, claims investigation & support and risk management solutions for the Canadian property and casualty insurance industry   First lien senior secured revolving loan ($2.4 par due 8/2022)   7.95% (Base Rate + 4.00%/Q)     8/29/2017     2.5     2.4 (2)(14)      
        First lien senior secured loan ($19.5 par due 8/2024)   7.28% (CIBOR + 5.00%/M)     8/29/2017     21.3     18.9 (2)(14)      
        Second lien senior secured loan ($55.6 par due 3/2025)   11.28% (CIBOR + 9.00%/M)     8/29/2017     60.5     52.3 (2)(14)      
                        84.3     73.6        

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
                                       
SpareFoot, LLC(18)   PMS solutions and web services for the self-storage industry.   First lien senior secured revolving loan ($0.3 par due 4/2023)   6.77% (Libor + 4.25%/M)     4/13/2018     0.3     0.3 (2)(14)      
        First lien senior secured loan ($1.2 par due 4/2024)   6.77% (Libor + 4.25%/M)     8/31/2018     1.1     1.2 (2)(14)      
        First lien senior secured loan ($4.7 par due 4/2024)   6.77% (Libor + 4.25%/M)     4/13/2018     4.6     4.7 (2)(14)      
        Second lien senior secured loan ($4.2 par due 4/2025)   10.77% (Libor + 8.25%/M)     8/31/2018     4.1     4.2 (2)(14)      
        Second lien senior secured loan ($6.1 par due 4/2025)   10.77% (Libor + 8.25%/M)     4/13/2018     6.0     6.1 (2)(14)      
                        16.1     16.5        
                                       
Sparta Systems, Inc., Project Silverback Holdings Corp. and Silverback Holdings, Inc.(18)   Quality management software provider   Second lien senior secured loan ($20.0 par due 8/2025)   10.76% (Libor + 8.25%/M)     8/21/2017     19.7     17.4 (2)(14)      
        Series B preferred shares (10,084 shares)         8/21/2017     1.1     0.5        
                        20.8     17.9        
                                       
Syntax USA Acquisition Corporation(8)(18)   Provider of cloud ERP hosting and consulting services for Oracle users   First lien senior secured revolving loan ($1.8 par due 4/2021)   6.67% (Libor + 4.25%/S)     2/8/2018     1.8     1.7 (2)(14)      
                                       
Telestream Holdings Corporation(18)   Provider of digital video tools and workflow solutions to the media and entertainment industries   First lien senior secured revolving loan ($0.5 par due 3/2022)   10.95% (Base Rate + 5.45%/Q)     2/8/2018     0.5     0.5 (2)(14)(17)      
                                       
TU BidCo, Inc.(18)   Provider of outsourced customer service management solutions and back-office support services to e-commerce, software and tech-enabled services industries   First lien senior secured loan ($18.1 par due 10/2023)   6.80% (Libor + 4.00%/Q)     10/1/2018     18.1     18.0 (3)(14)      
                                     

F-210


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
UL Holding Co., LLC(6)   Provider of collection and landfill avoidance solutions for food waste and unsold food products   Senior subordinated loan ($3.2 par due 5/2020)   10.00% PIK     4/30/2012     1.1     3.2 (2)      
        Senior subordinated loan ($0.4 par due 5/2020)         4/30/2012     0.2     0.4 (2)      
        Senior subordinated loan ($6.8 par due 5/2020)   10.00% PIK     4/30/2012     2.5     6.8 (2)      
        Senior subordinated loan ($0.5 par due 5/2020)         4/30/2012     0.2     0.5 (2)      
        Senior subordinated loan ($27.1 par due 5/2020)   10.00% PIK     4/30/2012     9.9     27.1 (2)      
        Senior subordinated loan ($3.8 par due 5/2020)         4/30/2012     1.4     3.8 (2)      
        Class A common units (533,351 units)         6/17/2011     5.0     0.3 (2)      
        Class B-5 common units (272,834 units)         6/17/2011     2.5     0.2 (2)      
        Class C common units (758,546 units)         4/25/2008         (2)      
        Warrant to purchase up to 719,044 shares of Class A units         5/2/2014         (2)      
        Warrant to purchase up to 28,663 shares of Class B-1 units         5/2/2014         (2)      
        Warrant to purchase up to 57,325 shares of Class B-2 units         5/2/2014         (2)      
        Warrant to purchase up to 29,645 shares of Class B-3 units         5/2/2014         (2)      
        Warrant to purchase up to 80,371 shares of Class B-5 units         5/2/2014         (2)      
        Warrant to purchase up to 59,655 shares of Class B-6 units         5/2/2014         (2)      
        Warrant to purchase up to 1,046,713 shares of Class C units         5/2/2014         (2)      
                        22.8     42.3        
                                       
Velocity Holdings Corp.   Hosted enterprise resource planning application management services provider   Common units (1,713,546 units)         12/13/2013     4.5     3.6        
                                       
Visual Edge Technology, Inc.(18)   Provider of outsourced office solutions with a focus on printer and copier equipment and other parts and supplies   First lien senior secured loan ($15.7 par due 8/2022)   8.27% (Libor + 5.75%/M)     8/31/2017     15.6     15.7 (2)(14)      
        First lien senior secured loan ($16.7 par due 8/2022)   8.27% (Libor + 5.75%/M)     8/31/2017     16.7     16.7 (2)(14)      
        Senior subordinated loan ($56.0 par due 9/2024)   12.50% PIK     8/31/2017     52.7     56.0 (2)      
        Warrant to purchase up to 1,816,089 shares of common stock (expires 8/2027)         8/31/2017         0.8 (2)      
        Warrant to purchase up to 2,070,511 shares of preferred stock (expires 8/2027)         8/31/2017     3.9     3.9 (2)      
                        88.9     93.1        
                                     

F-211


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
VRC Companies, LLC(18)   Provider of records and information management services   First lien senior secured revolving loan ($0.6 par due 3/2022)   9.02% (Libor + 6.50%/M)     4/17/2017     0.6     0.6 (2)(14)      
        First lien senior secured revolving loan ($0.2 par due 3/2022)   11.00% (Base Rate + 5.50%/M)     4/17/2017     0.2     0.2 (2)(14)      
        First lien senior secured loan ($2.3 par due 3/2023)   9.02% (Libor + 6.50%/M)     3/31/2017     2.3     2.3 (2)(14)      
        First lien senior secured loan ($0.2 par due 3/2023)   9.11% (Libor + 6.50%/S)     9/28/2018     0.2     0.2 (2)(14)      
        First lien senior secured loan ($5.0 par due 3/2023)   9.02% (Libor + 6.50%/S)     9/28/2018     5.0     5.0 (2)(14)      
                        8.3     8.3        
                                       
WorldPay Group PLC(8)   Payment processing company   C2 shares (73,974 shares)         10/21/2015         (21)      
                                       
Worldwide Facilities, LLC(18)   Specialty insurance wholesale broker   First lien senior secured revolving loan ($0.4 par due 4/2024)   6.77% (Libor + 4.25%/M)     5/3/2018     0.4     0.4 (2)(14)      
        First lien senior secured loan ($1.3 par due 4/2024)   7.05% (Libor + 4.25%/Q)     5/3/2018     1.3     1.2 (2)(14)      
        First lien senior secured loan ($1.6 par due 4/2024)   7.05% (Libor + 4.25%/Q)     5/3/2018     1.6     1.6 (2)(14)      
                        3.3     3.2        
                                       
XIFIN, Inc.(18)   Revenue cycle management provider to labs   First lien senior secured revolving loan       2/8/2018         (16)      
                                       
Zywave, Inc.(18)   Provider of software and technology-enabled content and analytical solutions to insurance brokers   First lien senior secured revolving loan ($6.3 par due 11/2022)   7.52% (Libor + 5.00%/M)     11/17/2016     6.3     6.2 (2)(14)      
        Second lien senior secured loan ($27.0 par due 11/2023)   11.65% (Libor + 9.00%/Q)     11/17/2016     27.0     26.5 (2)(14)      
                        33.3     32.7        
                        2,214.4     2,219.0     30.41 %
                                       
Consumer Products                                      
                                       
Badger Sportswear Acquisition, Inc.   Provider of team uniforms and athletic wear   Second lien senior secured loan ($56.8 par due 3/2024)   11.51% (Libor + 9.00%/M)     9/6/2016     56.7     56.8 (2)(14)      
                                       
BRG Sports, Inc.   Designer, manufacturer and licensor of branded sporting goods   Preferred stock (2,009 shares)         1/3/2017                
        Common stock (6,566,655 shares)         1/3/2017         0.2        
                            0.2        
                                       
Centric Brands Inc. (fka Differential Brands Group(18)   Designer, marketer and distributor of licensed and owned apparel   First lien senior secured loan ($58.8 par due 10/2023)   8.51% (Libor + 6.00%/Q)     10/29/2018     58.8     58.2 (3)(14)      
        Common stock (3,077,875 shares)         10/29/2018     24.6     24.6 (2)      
                        83.4     82.8        
                                       
CB Trestles OpCo, LLC(18)   Apparel retailer   First lien senior secured loan ($26.5 par due 10/2024)   8.51% (Libor + 5.75%/S)     10/26/2018     26.5     26.3 (3)(14)      
                                       
Consumer Health Parent LLC   Developer and marketer of over-the-counter cold remedy products   Preferred units (1,072 units)         12/15/2017     1.1     0.9 (2)      
        Series A units (1,072 units)         12/15/2017         (2)      
                        1.1     0.9        
                                     

F-212


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Feradyne Outdoors, LLC and Bowhunter Holdings, LLC   Provider of branded archery and bowhunting accessories   Common units (421 units)         4/24/2014     4.2     0.2 (2)      
                                       
Implus Footcare, LLC   Provider of footwear and other accessories   First lien senior secured loan ($14.2 par due 4/2021)   9.55% (Libor + 6.75%/Q)     6/1/2017     14.2     14.2 (2)(14)      
        First lien senior secured loan ($5.0 par due 4/2021)   9.55% (Libor + 6.75%/Q)     7/17/2018     5.0     5.0 (2)(14)      
        First lien senior secured loan ($76.4 par due 4/2021)   9.55% (Libor + 6.75%/Q)     6/1/2017     76.4     76.4 (2)(14)      
        First lien senior secured loan ($19.3 par due 4/2021)   9.55% (Libor + 6.75%/Q)     6/1/2017     19.3     19.3 (4)(14)      
        First lien senior secured loan ($0.2 par due 4/2021)   9.55% (Libor + 6.75%/Q)     6/30/2016     0.2     0.2 (2)(14)      
                        115.1     115.1        
                                       
Indra Holdings Corp.   Designer, marketer, and distributor of rain and cold weather products   First lien senior secured loan ($10.0 par due 5/2021)   6.77% (Libor + 4.25%/M)     1/22/2018     6.8     6.2 (2)(14)      
        Second lien senior secured loan ($80.0 par due 11/2021)         5/1/2014     68.1     19.9 (2)(14)      
                        74.9     26.1        
                                       
Plantation Products, LLC, Seed Holdings, Inc. and Flora Parent, Inc.   Provider of branded lawn and garden products   Second lien senior secured loan ($56.0 par due 6/2021)   9.92% (Libor + 7.39%/Q)     12/23/2014     55.9     56.0 (3)(14)      
        Second lien senior secured loan ($10.0 par due 6/2021)   9.92% (Libor + 7.39%/Q)     12/23/2014     10.0     10.0 (4)(14)      
        Common stock (30,000 shares)         12/23/2014     3.0     6.2 (2)      
                        68.9     72.2        
                                       
Rug Doctor, LLC and RD Holdco Inc.(7)   Manufacturer and marketer of carpet cleaning machines   Second lien senior secured loan ($16.9 par due 10/2019)   12.33% (Libor + 9.75%/Q)     1/3/2017     16.9     16.9 (2)(14)      
        Common stock (458,596 shares)         1/3/2017     14.0     11.1        
        Warrant to purchase up to 56,372 shares of common stock (expires 12/2023)         1/3/2017                
                        30.9     28.0        
                                       
S Toys Holdings LLC (fka The Step2 Company, LLC)(7)   Toy manufacturer   Common units (1,116,879 units)         4/1/2011         0.4        
        Class B common units (126,278,000 units)         10/30/2014         (2)      
        Warrant to purchase up to 3,157,895 units         4/1/2010                
                            0.4        
                                       
SHO Holding I Corporation   Manufacturer and distributor of slip resistant footwear   Second lien senior secured loan ($100.0 par due 4/2023)   11.03% (Libor + 8.50%/Q)     10/27/2015     98.5     91.0 (2)(14)      
                                       
Shock Doctor, Inc. and Shock Doctor Holdings, LLC(6)   Developer, marketer and distributor of sports protection equipment and accessories   Second lien senior secured loan ($89.4 par due 10/2021)   13.49% (Libor + 11.00%/Q)     4/22/2015     89.4     79.6 (2)(14)      
        Class A preferred units (50,000 units)         3/14/2014     5.0     1.0 (2)      
        Class C preferred units (50,000 units)         4/22/2015     5.0     1.0 (2)      
                        99.4     81.6        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Singer Sewing Company, SVP-Singer Holdings, LLC and SVP-Singer Holdings LP(7)(18)   Manufacturer of consumer sewing machines   First lien senior secured revolving loan ($72.6 par due 3/2023)   11.39% (Libor + 9.00%/Q)     7/26/2017     72.6     72.6 (2)(14)(17)      
        First lien senior secured revolving loan ($4.0 par due 3/2023)   11.38% (Libor + 9.00%/Q)     7/26/2017     4.0     4.0 (2)(14)(17)      
        First lien senior secured loan ($180.9 par due 3/2023)   5.00% (Libor + 2.61%/Q)     7/26/2017     174.6     159.1 (2)(14)      
        Class A common units (6,500,000 units)         7/26/2017         (2)      
                        251.2     235.7        
                                       
Touchstone Acquisition, Inc. and Touchstone Holding, L.P.(18)   Manufacturer of consumable products in the dental, medical, cosmetic and CPG/industrial end-markets   First lien senior secured loan ($53.7 par due 11/2025)   7.27% (Libor + 4.75%/M)     11/15/2018     53.7     53.2 (2)(14)      
        Class A preferred units (2,149 units)         11/15/2018     2.1     2.1 (2)      
                        55.8     55.3        
                                       
Varsity Brands Holding Co., Inc. and BCPE Hercules Holdings, LP   Leading manufacturer and distributor of textiles, apparel & luxury goods   Second lien senior secured loan ($21.1 par due 12/2025)   10.77% (Libor + 8.25%/M)     7/30/2018     21.1     21.1 (2)(14)      
        Second lien senior secured loan ($47.7 par due 12/2025)   10.77% (Libor + 8.25%/M)     12/15/2017     47.7     47.7 (2)(14)      
        Second lien senior secured loan ($75.0 par due 12/2025)   10.77% (Libor + 8.25%/M)     12/15/2017     75.0     75.0 (3)(14)      
        Class A units (1,400 units)         7/30/2018     1.4     1.5 (2)      
                        145.2     145.3        
                                       
Woodstream Group, Inc. and Woodstream Corporation(18)   Pet products manufacturer   First lien senior secured loan ($1.5 par due 5/2022)   8.72% (Libor + 6.25%/Q)     6/21/2017     1.5     1.5 (2)(14)      
        First lien senior secured loan ($0.9 par due 5/2022)   8.90% (Libor + 6.25%/Q)     6/21/2017     0.9     0.9 (2)(14)      
        First lien senior secured loan ($1.5 par due 5/2022)   9.04% (Libor + 6.25%/Q)     6/21/2017     1.5     1.5 (2)(14)      
        First lien senior secured loan ($3.1 par due 5/2022)   8.72% (Libor + 6.25%/Q)     6/21/2017     3.1     3.1 (4)(14)      
        First lien senior secured loan ($1.8 par due 5/2022)   8.90% (Libor + 6.25%/Q)     6/21/2017     1.8     1.8 (4)(14)      
        First lien senior secured loan ($3.1 par due 5/2022)   9.04% (Libor + 6.25%/Q)     6/21/2017     3.1     3.1 (4)(14)      
                        11.9     11.9        
                        1,123.7     1,029.8     14.11 %
                                       
Financial Services                                      
Amynta Agency Borrower Inc. and Amynta Warranty Borrower Inc.   Insurance service provider   First lien senior secured loan ($27.2 par due 2/2025)   6.52% (Libor + 4.00%/M)     12/21/2018     27.2     26.9 (2)(14)      
                                       
Commercial Credit Group, Inc.   Commercial equipment finance and leasing company   Senior subordinated loan ($28.0 par due 8/2022)   12.10% (Libor + 9.75%/M)     5/10/2012     28.0     28.0 (2)(14)      
                                       
DFC Global Facility Borrower II LLC(18)   Non-bank provider of alternative financial services   First lien senior secured revolving loan ($94.6 par due 9/2022)   13.10% (Libor + 10.75%/M)     9/27/2017     94.6     94.6 (2)(14)      
                                       
Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.(6)   Debt collection services provider   Common stock (180 shares)         1/11/2017         (2)      
                                     

F-214


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Gordian Group, LLC   Provider of products, services and software to organizations pursuing efficient and effective procurement and information solutions   Common stock (526 shares)         11/30/2012         (2)      
                                       
Ivy Hill Asset Management, L.P.(7)(8)   Asset management services   Member interest (100.00% interest)         6/15/2009     444.0     517.9        
                                       
Javlin Three LLC, Javlin Four LLC, and Javlin Five LLC(8)   Asset-backed financial services company   First lien senior secured loan ($16.0 par due 6/2017)         6/24/2014     14.7     10.1 (2)(13)      
                                       
Joyce Lane Capital LLC and Joyce Lane Financing SPV LLC (fka Ciena Capital LLC)(7)(8)(18)   Specialty finance company   First lien senior secured revolving loan ($0.8 par due 12/2022)   6.81% (Libor + 4.00%/Q)     12/27/2018     0.8     0.8 (2)      
        Equity interests         11/29/2010     12.7     3.1 (2)      
                        13.5     3.9        
                                       
LS DE LLC and LM LSQ Investors LLC(8)   Asset based lender   Senior subordinated loan ($3.0 par due 6/2021)   10.50%     6/15/2017     3.0     3.0 (2)      
        Senior subordinated loan ($37.0 par due 3/2024)   10.50%     6/25/2015     37.0     37.0 (2)      
        Membership units (3,275,000 units)         6/25/2015     3.3     4.0        
                        43.3     44.0        
                                       
NM GRC HOLDCO, LLC(18)   Regulatory compliance services provider to financial institutions   First lien senior secured loan ($19.3 par due 2/2024)   8.80% (Libor + 6.00%/Q)     2/9/2018     19.3     19.3 (2)(14)      
        First lien senior secured loan ($60.6 par due 2/2024)   8.80% (Libor + 6.00%/Q)     2/9/2018     60.1     60.6 (2)(14)      
                        79.4     79.9        
                                       
Payment Alliance International, Inc.(18)   Reseller of ATM process services through 3rd party processing networks   First lien senior secured revolving loan ($1.3 par due 9/2021)   8.49% (Libor + 6.05%/M)     2/8/2018     1.3     1.3 (2)(14)      
        First lien senior secured revolving loan ($2.1 par due 9/2021)   10.30% (Base Rate + 5.05%/M)     2/8/2018     2.1     2.1 (2)(14)      
                        3.4     3.4        
                                       
Rialto Management Group, LLC(8)(18)   Investment and asset management platform focused on real estate   First lien senior secured loan ($1.0 par due 12/2024)   7.02% (Libor + 4.50%/M)     11/30/2018     1.0     1.0 (2)(14)      
                                       
Vela Trading Technologies, LLC(18)   Provider of market data software and content to global financial services clients   First lien senior secured revolving loan ($0.5 par due 6/2022)   7.65% (Libor + 5.00%/Q)     2/8/2018     0.5     0.5 (2)(14)      
        First lien senior secured loan ($4.9 par due 6/2022)   7.45% (Libor + 5.00%/Q)     4/17/2018     4.9     4.8 (2)(14)      
                        5.4     5.3        
                        754.5     815.0     11.16 %
                                       
Investment Funds and Vehicles                                      
                                       
ACAS Equity Holdings Corporation(7)(8)   Investment company   Common stock (589 shares)         1/3/2017     0.4     0.4        
                                       
Ares IIIR/IVR CLO Ltd.(7)(8)   Investment vehicle   Subordinated notes ($20.0 par due 4/2021)         1/3/2017         0.1        
                                       
Blue Wolf Capital Fund II, L.P.(6)(8)   Investment partnership   Limited partnership interest (8.50% interest)         1/3/2017     1.6     2.5 (21)      
                                       
Carlyle Global Market Strategies CLO 2015-3(8)   Investment vehicle   Subordinated notes ($24.6 par due 7/2028)   13.70%     1/3/2017     14.7     17.1        
                                     

F-215


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Centurion CDO 8 Limited(8)   Investment vehicle   Subordinated notes ($5.0 par due 3/2019)         1/3/2017                
                                       
CoLTs 2005-1 Ltd.(7)(8)   Investment vehicle   Preferred shares (360 shares)         1/3/2017                
                                       
CoLTs 2005-2 Ltd.(7)(8)   Investment vehicle   Preferred shares (34,170,000 shares)         1/3/2017                
                                       
CREST Exeter Street Solar 2004-1(8)   Investment vehicle   Preferred shares (3,500,000 shares)         1/3/2017                
                                       
Eaton Vance CDO X plc(8)   Investment vehicle   Subordinated notes ($9.2 par due 2/2027)         1/3/2017         0.1        
                                       
European Capital UK SME Debt LP(6)(8)(19)   Investment partnership   Limited partnership interest (45% interest)         1/3/2017     38.6     39.5        
                                       
HCI Equity, LLC(7)(8)   Investment company   Member interest (100.00% interest)         4/1/2010         0.1 (21)      
                                       
Herbert Park B.V.(8)   Investment vehicle   Subordinated notes ($6.1 par due 10/2026)         1/3/2017     0.9            
                                       
Montgomery Lane, LLC and Montgomery Lane, Ltd.(7)(8)   Investment company   Common stock (100 shares)         1/3/2017                
        Common stock (50,000 shares)         1/3/2017                
                                   
                                       
OHA Credit Partners XI(8)   Investment vehicle   Subordinated notes ($17.8 par due 1/2032)   13.50%     1/3/2017     13.5     13.6        
                                       
Partnership Capital Growth Fund I, L.P.(6)(8)   Investment partnership   Limited partnership interest (25.00% interest)         6/16/2006         0.1 (2)(21)      
                                       
Partnership Capital Growth Investors III, L.P.(8)(19)   Investment partnership   Limited partnership interest (2.50% interest)         10/5/2011     2.5     4.2 (2)(21)      
                                       
PCG-Ares Sidecar Investment II, L.P.(6)(8)(19)   Investment partnership   Limited partnership interest (100.00% interest)         10/31/2014     6.7     17.4 (2)      
                                       
PCG-Ares Sidecar Investment, L.P.(6)(8)(19)   Investment partnership   Limited partnership interest (100.00% interest)         5/22/2014     4.5     4.4 (2)      
                                       
Piper Jaffray Merchant Banking Fund I, L.P.(8)(19)   Investment partnership   Limited partnership interest (2.00% interest)         8/16/2012     1.4     1.4 (21)      
                                       
Senior Direct Lending Program, LLC(7)(8)(20)   Co-investment vehicle   Subordinated certificates ($651.7 par due 12/2036)   10.81% (Libor + 8.00%/Q)(15)     7/27/2016     651.7     651.7 (14)      
        Member interest (87.50% interest)         7/27/2016         (14)      
                        651.7     651.7        
                                       
Vitesse CLO, Ltd.(8)   Investment vehicle   Preferred shares (20,000,000 shares)         1/3/2017                
                                       
Voya CLO 2014-4 Ltd.(8)   Investment vehicle   Subordinated notes ($26.7 par due 7/2031)   15.60%     1/3/2017     14.6     13.8        
                                       
VSC Investors LLC(8)   Investment company   Membership interest (1.95% interest)         1/24/2008     0.3     1.1 (2)(21)      
                        751.4     767.5     10.51 %
                                       
Manufacturing                                      
                                       
Chariot Acquisition, LLC(18)   Aftermarket golf cart parts and accessories   First lien senior secured loan ($18.2 par due 9/2021)   9.30% (Libor + 6.50%/Q)     1/3/2017     18.1     18.0 (3)(14)      
        First lien senior secured loan ($9.3 par due 9/2021)   9.30% (Libor + 6.50%/Q)     1/3/2017     9.2     9.2 (4)(14)      
                        27.3     27.2        
                                       
Dorner Holding Corp.(18)   Manufacturer of precision unit conveyors   First lien senior secured revolving loan ($0.2 par due 3/2022)   10.25% (Base Rate + 4.75%/Q)     3/15/2017     0.2     0.2 (2)(14)      
                                     

F-216


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
ECI Purchaser Company, LLC   Manufacturer of equipment to safely control pressurized gases   First lien senior secured loan ($21.8 par due 12/2019)   9.13% (Libor + 6.25%/Q)     7/26/2017     21.8     21.5 (2)(14)      
        First lien senior secured loan ($88.7 par due 12/2019)   8.15% (Libor + 5.25%/Q)     7/26/2017     88.7     87.8 (2)(14)      
        First lien senior secured loan ($74.8 par due 12/2019)   8.15% (Libor + 5.25%/Q)     7/26/2017     74.8     74.0 (3)(14)      
        First lien senior secured loan ($0.3 par due 12/2019)   9.13% (Libor + 6.25%/Q)     7/26/2017     0.3     0.3 (2)(14)      
        First lien senior secured loan ($0.2 par due 12/2019)   9.13% (Libor + 6.25%/Q)     7/26/2017     0.2     0.2 (3)(14)      
                        185.8     183.8        
                                       
ETG Holdings, Inc.(7)   Industrial woven products   Common stock (3,000 shares)         1/3/2017                
                                       
Harvey Tool Company, LLC(18)   Cutting tool provider to the metalworking industry   First lien senior secured revolving loan ($0.7 par due 10/2023)   7.01% (Libor + 4.50%/M)     10/12/2017     0.7     0.7 (2)(14)(17)      
        First lien senior secured loan ($20.5 par due 10/2024)   7.55% (Libor + 4.75%/Q)     10/12/2017     20.5     20.5 (2)(14)      
        First lien senior secured loan ($19.8 par due 10/2024)   7.55% (Libor + 4.75%/Q)     10/12/2017     19.8     19.8 (4)(14)      
        Second lien senior secured loan ($43.7 par due 10/2025)   10.93% (Libor + 8.50%/Q)     10/12/2017     43.7     43.7 (2)(14)      
                        84.7     84.7        
                                       
Ioxus, Inc.(6)   Energy storage devices   First lien senior secured loan ($1.3 par due 12/2019)         4/29/2014     1.3     1.3 (2)      
        First lien senior secured loan ($5.7 par due 12/2019)   7.00% Cash, 5.00% PIK     4/29/2014     5.6     5.7 (2)      
        Series CC preferred stock (1,683,265 shares)         9/7/2017     0.7     (2)      
        Warrant to purchase up to 75,968 shares of common stock (expires 1/2026)         1/28/2016         (2)      
        Warrant to purchase up to 30,256 shares of Series BB preferred stock (expires 8/2026)         8/24/2016         (2)      
        Warrant to purchase up to 8,416,326 shares of Series CC preferred stock (expires 1/2027)         1/27/2017         (2)      
                        7.6     7.0        
                                       
KPS Global LLC and Cool Group LLC   Walk-in cooler and freezer systems   First lien senior secured loan ($1.6 par due 4/2022)   5.09% (Libor + 2.63%/M)     4/5/2017     1.6     1.6 (2)(14)      
        First lien senior secured loan ($4.4 par due 4/2022)   9.65% (Libor + 7.19%/M)     11/16/2018     4.4     4.4 (2)(14)      
        First lien senior secured loan ($10.5 par due 4/2022)   9.61% (Libor + 7.14%/M)     4/5/2017     10.5     10.5 (2)(14)      
        First lien senior secured loan ($5.2 par due 4/2022)   9.61% (Libor + 7.14%/M)     4/5/2017     5.2     5.2 (4)(14)      
        Class A units (13,292 units)         9/21/2018     1.1     1.4        
                        22.8     23.1        
                                       
Mac Lean-Fogg Company and MacLean-Fogg Holdings, L.L.C.(18)   Manufacturer and supplier for the power utility and automotive markets worldwide   First lien senior secured loan ($206.0 par due 12/2025)   7.55% (Libor + 4.75%/Q)     12/21/2018     205.0     204.0 (2)(14)      
        Preferred units (70,183 units)   4.50% Cash, 9.25% PIK     10/9/2015     79.2     79.2        
                        284.2     283.2        
                                       
Nordco Inc.(18)   Railroad maintenance-of-way machinery   First lien senior secured revolving loan ($1.3 par due 8/2020)   11.00% (Base Rate + 5.50%/M)     8/26/2015     1.3     1.2 (2)(14)(17)      
                                     

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Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Pelican Products, Inc.   Flashlights   Second lien senior secured loan ($27.3 par due 5/2026)   10.13% (Libor + 7.75%/M)     5/4/2018     27.1     27.1 (2)(14)      
                                       
Sanders Industries Holdings, Inc. and SI Holdings, Inc.(18)   Elastomeric parts, mid-sized composite structures, and composite tooling   First lien senior secured loan ($50.2 par due 5/2020)   8.90% (Libor + 6.50%/Q)     7/21/2017     50.2     50.2 (2)(14)      
        First lien senior secured loan ($13.1 par due 5/2020)   8.90% (Libor + 6.50%/Q)     7/21/2017     13.1     13.1 (4)(14)      
        Common stock (1,500 shares)         5/30/2014     1.5     1.8 (2)      
                        64.8     65.1        
                                       
Saw Mill PCG Partners LLC   Metal precision engineered components   Common units (1,000 units)         1/30/2007     1.0     (2)      
                                       
Sonny's Enterprises, LLC(18)   Manufacturer and supplier of car wash equipment, parts and supplies to the conveyorized car wash market   First lien senior secured revolving loan ($0.2 par due 12/2022)   6.77% (Libor + 4.25%/M)     11/30/2017     0.2     0.2 (2)(14)      
                                       
Sunk Rock Foundry Partners LP, Hatteras Electrical Manufacturing Holding Company and Sigma Electric Manufacturing Corporation(18)   Manufacturer of metal castings, precision machined components and sub-assemblies in the electrical products, power transmission and distribution and general industrial markets   First lien senior secured revolving loan ($2.4 par due 10/2022)   7.55% (Libor + 4.75%/Q)     10/31/2017     2.4     2.4 (2)(14)(17)      
        First lien senior secured loan ($11.3 par due 10/2023)   7.55% (Libor + 4.75%/Q)     10/31/2017     11.3     11.3 (2)(14)      
        First lien senior secured loan ($12.4 par due 10/2023)   7.55% (Libor + 4.75%/Q)     10/31/2017     12.4     12.4 (2)(14)      
                        26.1     26.1        
                                       
TPTM Merger Corp.(18)   Time temperature indicator products   First lien senior secured loan ($13.3 par due 9/2020)   9.02% (Libor + 6.50%/Q)     12/11/2014     13.3     13.3 (3)(14)      
        First lien senior secured loan ($9.9 par due 9/2020)   9.02% (Libor + 6.50%/Q)     12/11/2014     9.9     9.9 (4)(14)      
                        23.2     23.2        
                        756.3     752.1     10.31 %
                                       
Other Services                                      
                                       
1A Smart Start, LLC(18)   Provider of ignition interlock devices   First lien senior secured revolving loan       2/8/2018         (16)      
                                       
AMCP Clean Intermediate, LLC(18)   Provider of janitorial and facilities management services   First lien senior secured revolving loan       10/1/2018         (16)      
        First lien senior secured loan ($7.6 par due 10/2024)   8.30% (Libor + 5.50%/Q)     10/1/2018     7.6     7.5 (2)(14)      
                        7.6     7.5        
                                       
American Residential Services L.L.C.   Heating, ventilation and air conditioning services provider   Second lien senior secured loan ($67.0 par due 12/2022)   10.52% (Libor + 8.00%/M)     6/30/2014     66.8     66.3 (2)(14)      
        Second lien senior secured loan ($3.8 par due 12/2022)   10.47% (Libor + 8.00%/M)     6/30/2014     3.7     3.7 (2)(14)      
                        70.5     70.0        
                                       
Capstone Logistics Acquisition, Inc.(18)   Outsourced supply chain solutions provider to operators of distribution centers   First lien senior secured revolving loan ($0.2 par due 4/2021)   9.00% (Base Rate + 3.50%/Q)     2/8/2018     0.2     0.2 (2)(14)(17)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC(6)(18)   Provider of outsourced healthcare linen management solutions   First lien senior secured revolving loan       3/13/2014         (16)      
        First lien senior secured loan ($11.9 par due 12/2021)   9.27% (Libor + 6.75%/M)     4/6/2017     11.9     11.9 (2)(14)      
        First lien senior secured loan ($12.0 par due 12/2021)   9.27% (Libor + 6.75%/M)     6/12/2018     12.0     12.0 (2)(14)      
        First lien senior secured loan ($10.1 par due 12/2021)   9.27% (Libor + 6.75%/M)     3/13/2014     10.1     10.1 (3)(14)      
        Class A preferred units (3,393,973 units)         3/13/2014     4.0     2.9 (2)      
        Class B common units (377,108 units)         3/13/2014     0.4     2.2 (2)      
                        38.4     39.1        
                                       
IMIA Holdings, Inc.(18)   Marine preservation maintenance company   First lien senior secured revolving loan       10/26/2018         (16)      
        First lien senior secured loan ($2.8 par due 10/2024)   7.30% (Libor + 4.50%/Q)     10/26/2018     2.8     2.8 (2)(14)      
        First lien senior secured loan ($18.0 par due 10/2024)   7.30% (Libor + 4.50%/Q)     10/26/2018     17.9     17.9 (3)(14)      
                        20.7     20.7        
                                       
Magento, Inc.(18)   eCommerce platform provider for the retail industry   First lien senior secured revolving loan       2/8/2018         (16)      
                                       
Massage Envy, LLC and ME Equity LLC(18)   Franchisor in the massage industry   First lien senior secured loan ($1.0 par due 12/2024)   9.40% (Libor + 6.75%/M)     1/24/2018     1.0     1.0 (2)(14)      
        First lien senior secured loan ($0.5 par due 12/2024)   9.49% (Libor + 6.75%/M)     1/24/2018     0.5     0.5 (2)(14)      
        First lien senior secured loan ($0.3 par due 12/2024)   9.52% (Libor + 6.75%/Q)     1/24/2018     0.3     0.3 (2)(14)      
        First lien senior secured loan ($1.7 par due 12/2024)   9.53% (Libor + 6.75%/Q)     1/24/2018     1.7     1.7 (2)(14)      
        First lien senior secured loan ($0.4 par due 12/2024)   9.46% (Libor + 6.75%/Q)     1/24/2018     0.4     0.4 (2)(14)      
        First lien senior secured loan ($0.7 par due 12/2024)   9.44% (Libor + 6.75%/Q)     1/24/2018     0.7     0.7 (2)(14)      
        First lien senior secured loan ($0.7 par due 12/2024)   9.55% (Libor + 6.75%/Q)     1/24/2018     0.7     0.7 (2)(14)      
        First lien senior secured loan ($0.4 par due 7/2020)   9.53% (Libor + 6.75%/Q)     7/20/2018     0.4     0.4 (2)(14)      
        First lien senior secured loan ($0.6 par due 9/2020)   9.49% (Libor + 6.75%/Q)     7/27/2017     0.6     0.6 (2)(14)      
        First lien senior secured loan ($0.5 par due 9/2020)   9.49% (Libor + 6.75%/Q)     7/27/2017     0.5     0.5 (2)(14)      
        First lien senior secured loan ($0.3 par due 9/2020)   9.44% (Libor + 6.75%/Q)     7/27/2017     0.3     0.3 (2)(14)      
        First lien senior secured loan ($0.3 par due 9/2020)   9.49% (Libor + 6.75%/Q)     4/12/2017     0.3     0.3 (2)(14)      
        First lien senior secured loan ($0.1 par due 9/2020)   9.55% (Libor + 6.75%/Q)     4/12/2017     0.1     0.1 (2)(14)      
        First lien senior secured loan ($1.0 par due 9/2020)   9.50% (Libor + 6.75%/Q)     4/12/2017     1.0     1.0 (2)(14)      
        First lien senior secured loan ($38.1 par due 9/2020)   9.46% (Libor + 6.75%/Q)     9/27/2012     38.1     38.1 (3)(14)      
        First lien senior secured loan ($18.5 par due 9/2020)   9.46% (Libor + 6.75%/Q)     9/27/2012     18.5     18.5 (4)(14)      
        Common stock (3,000,000 shares)         9/27/2012     3.0     6.2 (2)      
                        68.1     71.3        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Mckenzie Sports Products, LLC(18)   Designer, manufacturer and distributor of hunting-related supplies   First lien senior secured revolving loan ($2.2 par due 9/2020)   6.27% (Libor + 3.75%/M)     9/18/2014     2.2     2.2 (2)(14)      
        First lien senior secured revolving loan ($0.7 par due 9/2020)   8.25% (Base Rate + 2.75%/M)     9/18/2014     0.7     0.7 (2)(14)      
        First lien senior secured loan ($5.5 par due 9/2020)   8.27% (Libor + 5.75%/M)     9/18/2014     5.5     5.5 (3)(14)      
        First lien senior secured loan ($84.5 par due 9/2020)   9.61% (Libor + 7.09%/M)     9/18/2014     84.5     84.5 (3)(10)(14)      
                        92.9     92.9        
                                       
MSHC, Inc.(18)   Heating, ventilation and air conditioning services provider   First lien senior secured revolving loan ($1.6 par due 7/2022)   8.75% (Base Rate + 3.25%/Q)     7/31/2017     1.6     1.6 (2)(14)      
        First lien senior secured loan ($1.0 par due 7/2023)   6.89% (Libor + 4.25%/Q)     7/31/2017     1.0     1.0 (2)(14)      
        Second lien senior secured loan ($7.9 par due 7/2024)   10.78% (Libor + 8.25%/Q)     6/27/2018     7.9     7.9 (2)(14)      
        Second lien senior secured loan ($9.8 par due 7/2024)   10.96% (Libor + 8.25%/Q)     6/27/2018     9.8     9.8 (2)(14)      
        Second lien senior secured loan ($4.8 par due 7/2024)   11.05% (Libor + 8.25%/Q)     7/31/2017     4.8     4.8 (2)(14)      
        Second lien senior secured loan ($46.0 par due 7/2024)   11.05% (Libor + 8.25%/Q)     7/31/2017     46.0     46.0 (2)(14)      
                        71.1     71.1        
                                       
Osmose Utilities Services, Inc.(18)   Provider of structural integrity management services to transmission and distribution infrastructure   First lien senior secured revolving loan ($1.5 par due 8/2020)   10.50% (Base Rate + 5.00%/Q)     1/3/2017     1.5     1.5 (2)(14)(17)      
        Second lien senior secured loan ($51.4 par due 8/2023)   10.55% (Libor + 7.75%/Q)     9/3/2015     50.7     51.4 (2)(14)      
        Second lien senior secured loan ($34.0 par due 8/2023)   10.55% (Libor + 7.75%/Q)     1/3/2017     33.5     34.0 (2)(14)      
                        85.7     86.9        
                                       
SecurAmerica, LLC, ERMC LLC, ERMC Of America, LLC, SecurAmerica Corporation, ERMC Aviation LLC, American Security Programs, Inc., USI LLC and Argenbright Holdings IV, LLC(18)   Provider of outsourced manned security guard services, outsourced facilities management and outsourced aviation services   First lien senior secured loan ($26.1 par due 12/2023)   9.23% (Libor + 6.75%/M)     12/21/2018     26.1     25.8 (2)(14)      
                                       
Siteworx Holdings, LLC & Siteworx LLC(18)   Provider of design, web content management, eCommerce solutions and system integration   First lien senior secured revolving loan ($1.5 par due 1/2020)   6.75% (Base Rate + 1.25%/Q)     2/16/2018     1.5     1.5 (12)(14)      
        First lien senior secured loan ($2.4 par due 1/2020)   8.31% (Libor + 5.50%/Q)     2/16/2018     2.4     2.4 (12)(14)      
                        3.9     3.9        
                                       
SocialFlow, Inc.   Social media optimization platform provider   Warrant to purchase up to 215,331 shares of Series C preferred stock (expires 1/2026)         1/13/2016         (2)      
                                       
SoundCloud Limited(8)   Platform for receiving, sending, and distributing music   Common stock (73,422 shares)         8/15/2017     0.4     0.7 (2)      
                                       
Spin HoldCo Inc.   Laundry service and equipment provider   Second lien senior secured loan ($154.2 par due 5/2023)   10.19% (Libor + 7.50%/Q)     5/14/2013     154.2     152.6 (2)(14)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
TDG Group Holding Company and TDG Co-Invest, LP(18)   Operator of multiple franchise concepts primarily related to home maintenance or repairs   First lien senior secured revolving loan ($0.0 par due 5/2024)   8.02% (Libor + 5.50%/M)     5/31/2018         (2)(14)(17)      
        First lien senior secured loan ($3.2 par due 5/2024)   8.30% (Libor + 5.50%/Q)     5/31/2018     3.2     3.2 (2)(14)      
        First lien senior secured loan ($9.3 par due 5/2024)   8.30% (Libor + 5.50%/Q)     5/31/2018     9.3     9.2 (3)(14)      
        Preferred units (2,871,000 units)         5/31/2018     2.9     2.9 (2)      
        Common units (29,000 units)         5/31/2018         (2)      
                        15.4     15.3        
                                       
Tyden Group Holding Corp.(8)   Producer and marketer of global cargo security, product identification and traceability products and utility meter products   Preferred stock (46,276 shares)         1/3/2017     0.4     0.4        
        Common stock (5,521,203 shares)         1/3/2017     2.0     5.6        
                        2.4     6.0        
                                       
VLS Recovery Services, LLC(18)   Provider of commercial and industrial waste processing and disposal services   First lien senior secured revolving loan ($0.5 par due 10/2023)   8.46% (Libor + 6.00%/M)     10/17/2017     0.5     0.5 (2)(14)(17)      
        First lien senior secured revolving loan ($1.1 par due 10/2023)   8.47% (Libor + 6.00%/M)     10/17/2017     1.1     1.1 (2)(14)(17)      
        First lien senior secured revolving loan ($1.1 par due 10/2023)   8.38% (Libor + 6.00%/M)     10/17/2017     1.1     1.1 (2)(14)(17)      
        First lien senior secured revolving loan ($0.5 par due 10/2023)   8.40% (Libor + 6.00%/M)     10/17/2017     0.5     0.5 (2)(14)(17)      
        First lien senior secured loan ($5.1 par due 10/2023)   8.47% (Libor + 6.00%/M)     10/17/2017     5.1     5.1 (2)(14)      
        First lien senior secured loan ($6.8 par due 10/2023)   8.46% (Libor + 6.00%/M)     10/17/2017     6.8     6.8 (2)(14)      
                        15.1     15.1        
                                       
WASH Multifamily Acquisition Inc. and Coinamatic Canada Inc.   Laundry service and equipment provider   Second lien senior secured loan ($3.7 par due 5/2023)   9.52% (Libor + 7.00%/M)     5/14/2015     3.7     3.6 (2)(14)      
        Second lien senior secured loan ($21.3 par due 5/2023)   9.52% (Libor + 7.00%/M)     5/14/2015     21.0     20.6 (2)(14)      
                        24.7     24.2        
                        697.4     703.3     9.64 %
                                       
Power Generation                                      
                                       
Alphabet Energy, Inc.   Technology developer to convert waste-heat into electricity   First lien senior secured loan ($3.5 par due 8/2017)         12/16/2013     2.9     (2)(13)      
        Series 1B preferred stock (12,976 shares)         6/21/2016     0.2     (2)      
        Warrant to purchase up to 125,000 shares of Series 2 preferred stock (expires 12/2023)         6/30/2016     0.1     (2)      
                        3.2            
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Apex Clean Energy Holdings, LLC(18)   Developer, builder and owner of utility-scale wind and solar power facilities   First lien senior secured revolving loan       12/12/2018         (16)      
        First lien senior secured loan ($95.4 par due 9/2022)   9.55% (Libor + 6.75%/Q)     9/24/2018     95.4     94.5 (2)(14)      
                        95.4     94.5        
                                       
CPV Maryland Holding Company II, LLC   Gas turbine power generation facilities operator   Senior subordinated loan ($51.4 par due 12/2020)   6.00% Cash, 5.00% PIK     8/8/2014     51.4     46.8 (2)      
                                       
DGH Borrower LLC(18)   Developer, owner and operator of quick start, small-scale natural gas-fired power generation projects   First lien senior secured loan ($47.2 par due 6/2023)   9.30% (Libor + 6.50%/Q)     6/8/2018     47.2     47.2 (2)(14)      
                                       
Green Energy Partners, Stonewall LLC and Panda Stonewall Intermediate Holdings II LLC   Gas turbine power generation facilities operator   First lien senior secured loan ($24.7 par due 11/2021)   8.30% (Libor + 5.50%/Q)     11/13/2014     24.6     24.2 (2)(14)      
        Senior subordinated loan ($21.2 par due 12/2021)   8.00% Cash, 5.25% PIK     11/13/2014     21.2     20.4 (2)      
        Senior subordinated loan ($99.0 par due 12/2021)   8.00% Cash, 5.25% PIK     11/13/2014     99.0     95.3 (2)      
                        144.8     139.9        
                                       
Joule Unlimited Technologies, Inc. and Stichting Joule Global Foundation   Renewable fuel and chemical production developer   First lien senior secured loan ($7.8 par due 10/2018)         3/31/2015     5.8     (2)(13)      
        Warrant to purchase up to 32,051 shares of Series C-2 preferred stock (expires 7/2023)         7/25/2013         (2)(8)      
                        5.8            
                                       
Moxie Patriot LLC   Gas turbine power generation facilities operator   First lien senior secured loan ($32.5 par due 12/2020)   8.55% (Libor + 5.75%/Q)     12/19/2013     32.4     31.9 (2)(14)      
                                       
Navisun LLC and Navisun Holdings LLC(7)(18)   Owner and operater of commercial and industrial solar projects   First lien senior secured loan ($25.0 par due 11/2023)   8.00% PIK     11/15/2017     25.0     25.0 (2)      
        Series A preferred units   10.50% PIK     11/15/2017     2.9     2.9 (2)      
        Class A units (550 units)         11/15/2017                
                        27.9     27.9        
                                       
Panda Liberty LLC (fka Moxie Liberty LLC)   Gas turbine power generation facilities operator   First lien senior secured loan ($49.6 par due 8/2020)   9.30% (Libor + 6.50%/Q)     4/6/2018     47.0     44.7 (2)(14)      
        First lien senior secured loan ($34.0 par due 8/2020)   9.30% (Libor + 6.50%/Q)     8/21/2013     33.9     30.6 (2)(14)      
                        80.9     75.3        
                                       
Panda Temple Power, LLC and T1 Power Holdings LLC(6)   Gas turbine power generation facilities operator   Second lien senior secured loan ($9.0 par due 2/2023)   10.46% (Libor + 8.00%/M)     3/6/2015     9.0     9.0 (2)(14)      
        Class A Common units (616,122 shares)         3/6/2015     15.0     13.0 (2)      
                        24.0     22.0        
                                       
PERC Holdings 1 LLC   Operator of recycled energy, combined heat and power, and energy efficiency facilities   Class B common units (21,653,543 units)         10/20/2014     21.7     34.7 (2)      
                                       
Riverview Power LLC   Operator of natural gas and oil fired power generation facilities   First lien senior secured loan ($81.2 par due 12/2022)   10.80% (Libor + 8.00%/Q)     12/29/2016     79.7     81.2 (2)(14)      
                        614.4     601.4     8.24 %
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Restaurants and Food Services                                      
                                       
ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.(7)(18)   Restaurant owner and operator   First lien senior secured loan ($4.3 par due 12/2018)   20.32% PIK (Libor + 18.00%/Q)     12/22/2016     4.3     4.3 (2)(14)      
        First lien senior secured loan ($56.6 par due 12/2018)         11/27/2006     39.9     1.2 (2)(13)      
        Promissory note ($31.8 par due 12/2023)         11/27/2006     13.8     (2)      
        Warrant to purchase up to 0.95 units of Series D common stock (expires 12/2023)         12/18/2013         (2)      
                        58.0     5.5        
                                       
Cipriani USA, Inc.   Manager and operator of banquet facilities, restaurants, hotels and other leisure properties   First lien senior secured loan ($3.0 par due 5/2023)   10.34% (Libor + 8.00%/M)     8/20/2018     3.0     3.0 (2)(14)      
        First lien senior secured loan ($12.0 par due 5/2023)   10.35% (Libor + 8.00%/M)     11/5/2018     12.0     11.9 (2)(14)      
        First lien senior secured loan ($3.0 par due 5/2023)   10.38% (Libor + 8.00%/M)     11/5/2018     3.0     3.0 (2)(14)      
        First lien senior secured loan ($67.8 par due 5/2023)   10.34% (Libor + 8.00%/M)     5/30/2018     67.8     67.1 (2)(14)      
                        85.8     85.0        
                                       
Cozzini Bros., Inc. and BH-Sharp Holdings LP(18)   Provider of commercial knife sharpening and cutlery services in the restaurant industry   First lien senior secured revolving loan ($1.5 par due 3/2023)   8.02% (Libor + 5.50%/M)     3/10/2017     1.5     1.5 (2)(14)      
        First lien senior secured loan ($6.6 par due 3/2023)   8.02% (Libor + 5.50%/M)     3/10/2017     6.6     6.6 (2)(14)      
        First lien senior secured loan ($11.6 par due 3/2023)   8.02% (Libor + 5.50%/M)     3/10/2017     11.6     11.6 (4)(14)      
        Common units (2,950,000 units)         3/10/2017     3.0     3.4 (2)      
                        22.7     23.1        
                                       
FWR Holding Corporation(18)   Restaurant owner, operator, and franchisor   First lien senior secured revolving loan ($0.8 par due 8/2023)   10.25% (Base Rate + 4.75%/Q)     8/21/2017     0.8     0.8 (2)(14)(17)      
        First lien senior secured loan ($0.5 par due 8/2023)   8.26% (Libor + 5.75%/M)     8/21/2017     0.5     0.5 (2)(14)      
        First lien senior secured loan ($0.8 par due 8/2023)   8.26% (Libor + 5.75%/M)     8/21/2017     0.8     0.8 (2)(14)      
        First lien senior secured loan ($4.0 par due 8/2023)   8.26% (Libor + 5.75%/M)     8/21/2017     4.0     4.0 (2)(14)      
                        6.1     6.1        
                                       
Garden Fresh Restaurant Corp. and GFRC Holdings LLC(18)   Restaurant owner and operator   First lien senior secured revolving loan       2/1/2017         (16)      
        First lien senior secured loan ($23.9 par due 2/2022)   10.39% (Libor + 8.00%/S)     10/3/2013     23.9     23.9 (2)(14)      
                        23.9     23.9        
                                       
Heritage Food Service Group, Inc. and WCI-HFG Holdings, LLC   Distributor of repair and replacement parts for commercial kitchen equipment   Second lien senior secured loan ($31.6 par due 10/2022)   11.00% (Libor + 8.50%/S)     10/20/2015     31.6     31.6 (2)(14)      
        Preferred units (3,000,000 units)         10/20/2015     3.0     4.5 (2)      
                        34.6     36.1        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Jim N Nicks Management, LLC(18)   Restaurant owner and operator   First lien senior secured revolving loan ($2.8 par due 7/2023)   8.05% (Libor + 5.25%/Q)     7/10/2017     2.8     2.7 (2)(14)      
        First lien senior secured loan ($1.2 par due 7/2023)   8.05% (Libor + 5.25%/Q)     7/10/2017     1.2     1.1 (2)(14)      
        First lien senior secured loan ($14.0 par due 7/2023)   8.05% (Libor + 5.25%/Q)     7/10/2017     14.0     13.5 (4)(14)      
                        18.0     17.3        
                                       
Orion Foods, LLC(7)   Convenience food service retailer   First lien senior secured loan ($1.2 par due 9/2015)         4/1/2010     1.2     0.5 (2)(13)      
        Second lien senior secured loan ($19.4 par due 9/2015)         4/1/2010         (2)(13)      
        Preferred units (10,000 units)         10/28/2010         (2)      
        Class A common units (25,001 units)         4/1/2010         (2)      
        Class B common units (1,122,452 units)         4/1/2010         (2)      
                        1.2     0.5        
                                       
OTG Management, LLC(18)   Airport restaurant operator   First lien senior secured revolving loan ($1.6 par due 8/2021)   9.65% (Libor + 7.00%/Q)     8/26/2016     1.6     1.6 (2)(14)      
        First lien senior secured revolving loan ($8.4 par due 8/2021)   9.41% (Libor + 7.00%/Q)     8/26/2016     8.4     8.4 (2)(14)      
        First lien senior secured loan ($4.7 par due 8/2021)   9.61% (Libor + 7.00%/Q)     8/26/2016     4.7     4.7 (2)(14)      
        First lien senior secured loan ($2.2 par due 8/2021)   9.60% (Libor + 7.00%/Q)     8/26/2016     2.2     2.2 (2)(14)      
        First lien senior secured loan ($2.2 par due 8/2021)   9.71% (Libor + 7.00%/Q)     8/26/2016     2.2     2.2 (2)(14)      
        First lien senior secured loan ($6.1 par due 8/2021)   9.51% (Libor + 7.00%/Q)     8/26/2016     6.1     6.1 (2)(14)      
        First lien senior secured loan ($4.9 par due 8/2021)   9.54% (Libor + 7.00%/Q)     8/26/2016     4.9     4.9 (2)(14)      
        First lien senior secured loan ($0.7 par due 8/2021)   9.41% (Libor + 7.00%/Q)     8/26/2016     0.7     0.7 (2)(14)      
        First lien senior secured loan ($1.8 par due 8/2021)   9.78% (Libor + 7.00%/Q)     8/26/2016     1.8     1.8 (2)(14)      
        First lien senior secured loan ($1.0 par due 8/2021)   9.43% (Libor + 7.00%/Q)     8/26/2016     1.0     1.0 (2)(14)      
        First lien senior secured loan ($1.9 par due 8/2021)   9.41% (Libor + 7.00%/Q)     10/10/2018     1.9     1.9 (2)(14)      
        First lien senior secured loan ($0.7 par due 8/2021)   9.61% (Libor + 7.00%/Q)     10/10/2018     0.7     0.7 (2)(14)      
        First lien senior secured loan ($0.7 par due 8/2021)   9.78% (Libor + 7.00%/Q)     10/10/2018     0.7     0.7 (2)(14)      
        First lien senior secured loan ($48.9 par due 8/2021)   9.40% (Libor + 7.00%/Q)     8/26/2016     48.9     48.9 (3)(14)      
        First lien senior secured loan ($48.9 par due 8/2021)   9.54% (Libor + 7.00%/Q)     8/26/2016     48.9     48.9 (3)(14)      
        Senior subordinated loan ($30.1 par due 2/2022)   13.00% PIK     8/26/2016     30.0     30.1 (2)      
        Class A preferred units (3,000,000 units)         8/26/2016     30.0     39.5 (2)      
        Common units (3,000,000 units)         1/5/2011     3.0     9.2 (2)      
        Warrant to purchase up to 7.73% of common units         6/19/2008     0.1     20.3 (2)      
                        197.8     233.8        
                                       
SFE Intermediate Holdco LLC(18)   Provider of outsourced foodservice to K-12 school districts   First lien senior secured loan ($10.8 par due 7/2024)   7.50% (Libor + 4.75%/Q)     9/5/2018     10.8     10.8 (2)(14)      
        First lien senior secured loan ($6.7 par due 7/2024)   7.28% (Libor + 4.75%/Q)     7/31/2017     6.7     6.7 (4)(14)      
                        17.5     17.5        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Spectra Finance, LLC(18)   Venue management and food and beverage provider   First lien senior secured revolving loan ($5.4 par due 4/2023)   6.39% (Libor + 4.00%/M)     4/2/2018     5.4     5.4 (2)(14)(17)      
        First lien senior secured loan ($19.0 par due 4/2024)   7.05% (Libor + 4.25%/Q)     4/2/2018     19.0     19.0 (2)(14)      
                        24.4     24.4        
                        490.0     473.2     6.49 %
                                       
Oil and Gas                                      
                                       
Murchison Oil and Gas, LLC and Murchison Holdings, LLC(18)   Exploration and production company   First lien senior secured loan ($5.0 par due 10/2023)   10.80% (Libor + 8.00%/Q)     10/26/2018     5.0     5.0 (2)(14)      
        First lien senior secured loan ($21.7 par due 10/2023)   10.80% (Libor + 8.00%/Q)     10/26/2018     21.1     21.5 (2)(14)      
        Preferred units (21,667 units)         10/26/2018     21.7     21.7        
                        47.8     48.2        
                                       
Penn Virginia Holding Corp.   Exploration and production company   Second lien senior secured loan ($90.1 par due 9/2022)   9.53% (Libor + 7.00%/M)     9/28/2017     90.1     90.1 (2)(14)      
                                       
Petroflow Energy Corporation and TexOak Petro Holdings LLC(6)   Oil and gas exploration and production company   First lien senior secured loan ($10.3 par due 6/2019)         6/29/2016     8.5     8.3 (2)(13)      
        Second lien senior secured loan ($26.6 par due 12/2019)         6/29/2016     21.9     (2)(13)      
        Common units (202,000 units)         6/29/2016     11.1            
                        41.5     8.3        
                                       
Sundance Energy, Inc.   Oil and gas producer   Second lien senior secured loan ($60.7 par due 4/2023)   10.81% (Libor + 8.00%/Q)     4/23/2018     59.7     60.7 (2)(14)      
                                       
Utility Pipeline, Ltd.(18)   Natural gas distribution management company   First lien senior secured revolving loan ($0.1 par due 4/2022)   6.69% (Libor + 4.00%/Q)     2/8/2018     0.1     0.1 (2)(14)      
                                       
VPROP Operating, LLC and Vista Proppants and Logistics, LLC   Sand-based proppant producer and distributor to the oil and natural gas industry   First lien senior secured loan ($28.5 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     8/1/2017     28.4     28.5 (2)(14)      
        First lien senior secured loan ($35.6 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     11/9/2017     35.6     35.6 (2)(14)      
        First lien senior secured loan ($15.3 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     3/1/2017     15.3     15.3 (2)(14)      
        First lien senior secured loan ($76.3 par due 8/2021)   12.24% (Libor + 8.50% Cash, 1.00% PIK/Q)     3/1/2017     76.3     76.3 (3)(14)      
        Common units (997,864 units)         11/9/2017     9.7     9.6 (2)      
                        165.3     165.3        
                        404.5     372.7     5.11 %
                                       
Food and Beverage                                      
                                       
American Seafoods Group LLC and American Seafoods Partners LLC   Harvester and processor of seafood   Class A units (77,922 units)         8/19/2015     0.1     0.2 (2)      
        Warrant to purchase up to 7,422,078 Class A units (expires 8/2035)         8/19/2015     7.4     15.6 (2)      
                        7.5     15.8        
                                       
CHG PPC Parent LLC   Diversified food products manufacturer   Second lien senior secured loan ($60.5 par due 3/2026)   10.02% (Libor + 7.50%/M)     3/30/2018     60.5     59.9 (2)(14)      
                                       
Edward Don & Company, LLC and VCP-EDC Co-Invest, LLC   Distributor of foodservice equipment and supplies   Membership units (2,970,000 units)         6/9/2017     3.0     4.2        
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Ferraro Fine Foods Corp. and Italian Fine Foods Holdings L.P.(18)   Specialty Italian food distributor   First lien senior secured revolving loan ($1.3 par due 5/2023)   6.85% (Libor + 4.25%/Q)     5/9/2018     1.3     1.3 (2)(14)      
        First lien senior secured loan ($0.7 par due 5/2024)   7.02% (Libor + 4.25%/Q)     12/7/2018     0.7     0.7 (2)(14)      
        First lien senior secured loan ($9.4 par due 5/2024)   6.85% (Libor + 4.25%/Q)     5/9/2018     9.4     9.4 (2)(14)      
        Class A common units (2,724,000 units)         5/9/2018     2.7     3.1 (2)      
                        14.1     14.5        
                                       
Gehl Foods, LLC and GF Parent LLC   Producer of low-acid, aseptic food and beverage products   Class A preferred units         5/13/2015     2.9     (2)      
        Class A common units (60,000 units)         5/13/2015     0.1     (2)      
        Class B common units (0.26 units)         5/13/2015         (2)      
                        3.0            
                                       
H-Food Holdings, LLC and Matterhorn Parent, LLC   Food contract manufacturer   First lien senior secured loan ($30.9 par due 5/2025)   6.52% (Libor + 4.00%/M)     11/25/2018     30.6     30.0 (2)(14)      
        Second lien senior secured loan ($73.0 par due 3/2026)   9.51% (Libor + 7.00%/M)     11/25/2018     73.0     71.6 (2)(14)      
        Common units (5,827 units)         11/25/2018     5.8     5.8        
                        109.4     107.4        
                                       
Hometown Food Company(18)   Food distributor   First lien senior secured loan ($9.3 par due 8/2023)   7.78% (Libor + 5.25%/M)     8/31/2018     9.1     9.2 (2)(14)      
                                       
JWC/KI Holdings, LLC   Foodservice sales and marketing agency   Membership units (5,000 units)         11/16/2015     5.0     5.3 (2)      
                                       
KC Culinarte Intermediate, LLC   Manufacturer of fresh refrigerated and frozen food products   Second lien senior secured loan ($35.7 par due 8/2026)   10.26% (Libor + 7.75%/M)     8/24/2018     35.7     35.1 (2)(14)      
                                       
NECCO Holdings, Inc. and New England Confectionery Company, Inc.(7)(18)   Producer and supplier of candy   First lien senior secured revolving loan ($19.9 par due 1/2018)       1/3/2017     7.9     2.9 (13)      
        First lien senior secured loan ($2.2 par due 8/2018)         11/20/2017     2.1     (13)      
        First lien senior secured loan ($11.6 par due 1/2018)         1/3/2017     0.9     1.6 (13)      
        First lien senior secured loan ($0.7 par due 11/2018)         11/20/2017     0.7     0.1 (13)      
        Common stock (860,189 shares)         1/3/2017                
                        11.6     4.6        
                                       
PCM Bmark, Inc. and BakeMark Holdings, Inc.   Manufacturer and distributor of specialty bakery ingredients   First lien senior secured loan ($0.6 par due 8/2023)   7.77% (Libor + 5.25%/M)     5/9/2018     0.6     0.6 (2)(14)      
                                       
RF HP SCF Investor, LLC(8)   Branded specialty food company   Membership interest (10.08% interest)         12/22/2016     12.5     16.2 (2)      
                                       
Sovos Brands Intermediate, Inc.(18)   Food and beverage platform   First lien senior secured loan ($16.9 par due 11/2025)   7.64% (Libor + 5.00%/S)     11/20/2018     16.7     16.7 (2)(14)      

F-226


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Teasdale Foods, Inc.(18)   Provider of beans, sauces and hominy to the retail, foodservice and wholesale channels   First lien senior secured revolving loan ($0.6 par due 10/2020)   7.72%
(Libor + 5.25%/M)
    6/30/2017     0.6     0.5 (2)(14)      
        First lien senior secured revolving loan ($0.1 par due 10/2020)   9.75%
(Base Rate + 4.25%/M)
    6/30/2017     0.1     0.1 (2)(14)      
        First lien senior secured loan ($0.6 par due 10/2020)   7.65%
(Libor + 5.25%/Q)
    6/26/2018     0.6     0.6 (2)(14)      
        Second lien senior secured loan ($33.6 par due 10/2021)   11.28%
(Libor + 8.75%/Q)
    1/3/2017     33.6     28.9 (2)(14)      
        Second lien senior secured loan ($31.5 par due 10/2021)   11.28%
(Libor + 8.75%/Q)
    1/3/2017     31.5     27.1 (2)(14)      
        Second lien senior secured loan ($21.3 par due 10/2021)   11.24%
(Libor + 8.75%/Q)
    1/3/2017     21.3     18.3 (2)(14)      
                        87.7     75.5        
                        376.4     365.0     5.00 %
                                       
Automotive Services                                      
A.U.L. Corp.(18)   Provider of vehicle service contracts and limited warranties for passenger vehicles   First lien senior secured loan ($7.0 par due 6/2023)   7.06%
(Libor + 4.50%/M)
    6/7/2017     7.0     7.0 (2)(14)      
                                       
AEP Holdings, Inc. and Arrowhead Holdco Company   Distributor of non-discretionary, mission-critical aftermarket replacement parts   First lien senior secured loan ($0.1 par due 8/2021)   8.35%
(Libor + 6.00%/S)
    6/28/2018     0.1     0.1 (2)(14)      
        First lien senior secured loan ($27.4 par due 8/2021)   8.51%
(Libor + 6.00%/S)
    6/28/2018     27.3     26.8 (2)(14)      
        Common stock (3,467 shares)         8/31/2015     3.5     2.7 (2)      
                        30.9     29.6        
                                       
ChargePoint, Inc.   Developer and operator of electric vehicle charging stations   Warrant to purchase up to 809,126 shares of Series E preferred stock (expires 12/2024)         12/30/2014     0.3     2.8 (2)      
                                       
Dent Wizard International Corporation and DWH Equity Investors, L.P.   Automotive reconditioning services   Second lien senior secured loan ($50.0 par due 10/2020)   10.51%
(Libor + 8.00%/M)
    4/7/2015     50.0     50.0 (2)(14)      
        Class A common stock (10,000 shares)         4/7/2015     0.2     0.6 (2)      
        Class B common stock (20,000 shares)         4/7/2015     0.4     1.3 (2)      
                        50.6     51.9        
                                       
Eckler Industries, Inc. and Eckler Purchaser LLC(7)(18)   Restoration parts and accessories provider for classic automobiles   First lien senior secured revolving loan ($1.3 par due 5/2022)   12.00%     7/12/2012     1.3     1.3 (2)      
        First lien senior secured loan ($18.3 par due 5/2022)   12.00%     7/12/2012     18.1     18.3 (2)      
        Class A preferred units (67,972 units)         7/12/2012     15.9     3.2 (2)      
        Class A common units (67,972 units)         7/12/2012     0.5     (2)      
                        35.8     22.8        
                                       
ESCP PPG Holdings, LLC(6)   Distributor of new equipment and aftermarket parts to the heavy-duty truck industry   Class A units (3,500,000 units)         12/14/2016     3.5     2.4 (2)      
                                     

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Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
GB Auto Service Holdings, LLC(18)   Automotive parts and repair services retailer   First lien senior secured loan ($22.4 par due 10/2024)   8.47%
(Libor + 6.00%/M)
    10/19/2018     22.4     22.2 (3)(14)      
        Common units (3,700,000 units)         10/19/2018     4.6     4.6 (2)      
                        27.0     26.8        
                                       
Mavis Tire Express Services Corp. and Mavis Tire Express Services TopCo, L.P.(18)   Auto parts retailer   Second lien senior secured loan ($1.4 par due 3/2026)   9.97%
(Libor + 7.50%/M)
    3/20/2018     1.4     1.4 (2)(14)      
        Second lien senior secured loan ($153.9 par due 3/2026)   9.97%
(Libor + 7.50%/M)
    3/20/2018     151.7     152.4 (2)(14)      
        Class A units (12,400,000 units)         3/20/2018     12.4     13.0 (2)      
                        165.5     166.8        
                                       
Simpson Performance Products, Inc.   Provider of motorsports safety equipment   First lien senior secured loan ($28.3 par due 2/2020)   10.28%
(Libor + 7.48%/Q)
    2/20/2015     28.3     28.3 (3)(14)      
                                       
SK SPV IV, LLC   Collision repair site operator   Series A common stock (12,500 units)         8/18/2014     0.6     2.5 (2)      
        Series B common stock (12,500 units)         8/18/2014     0.6     2.5 (2)      
                        1.2     5.0        
                        350.1     343.4     4.71 %
                                       
Wholesale Distribution                                      
DFS Holding Company, Inc.   Distributor of maintenance, repair, and operations parts, supplies, and equipment to the foodservice industry   First lien senior secured loan ($4.6 par due 2/2022)   8.27%
(Libor + 5.75%/M)
    3/1/2017     4.6     4.5 (2)(14)      
        First lien senior secured loan ($85.8 par due 2/2022)   8.27%
(Libor + 5.75%/M)
    7/26/2017     85.8     83.2 (2)(14)      
        First lien senior secured loan ($93.5 par due 2/2022)   8.27%
(Libor + 5.75%/M)
    7/26/2017     93.5     90.7 (3)(14)      
                        183.9     178.4        
                                       
Flow Control Solutions, Inc.(18)   Distributor and manufacturer of flow control systems components   First lien senior secured revolving loan ($0.4 par due 11/2024)   8.05%
(Libor + 5.25%/Q)
    11/21/2018     0.4     0.4 (2)(14)      
        First lien senior secured loan ($13.7 par due 11/2024)   8.05%
(Libor + 5.25%/Q)
    11/21/2018     13.7     13.6 (3)(14)      
                        14.1     14.0        
                                       
KHC Holdings, Inc. and Kele Holdco, Inc.(18)   Catalog-based distribution services provider for building automation systems   First lien senior secured revolving loan ($0.7 par due 10/2020)   6.76%
(Libor + 4.25%/M)
    1/3/2017     0.7     0.7 (2)(14)      
        First lien senior secured loan ($66.0 par due 10/2022)   8.80%
(Libor + 6.00%/Q)
    1/3/2017     66.0     66.0 (3)(14)      
        Common stock (30,000 shares)         1/3/2017     3.1     3.3        
                        69.8     70.0        
                                       
PetIQ, LLC   Distributor and manufacturer of pet prescription medications and health products   First lien senior secured revolving loan ($17.9 par due 1/2023)   7.60%
(Libor + 5.25%/M)
    1/17/2018     17.9     17.9 (2)(14)      
                        285.7     280.3     3.84 %
                                     

F-228


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Education                                      
Excelligence Holdings Corp.   Developer, manufacturer and retailer of educational products   First lien senior secured loan ($9.3 par due 4/2023)   8.52%
(Libor + 6.00%/M)
    4/17/2017     9.3     8.0 (4)(14)      
                                       
Flinn Scientific, Inc. and WCI-Quantum Holdings, Inc.(18)   Distributor of instructional products, services and resources   First lien senior secured loan ($20.9 par due 8/2023)   7.55%
(Libor + 4.75%/Q)
    7/26/2017     20.9     20.9 (2)(14)      
        First lien senior secured loan ($25.4 par due 8/2023)   7.53%
(Libor + 4.75%/Q)
    7/26/2017     25.4     25.4 (2)(14)      
        First lien senior secured loan ($0.1 par due 8/2023)   9.25%
(Base Rate + 3.75%/Q)
    7/26/2017     0.1     0.1 (2)(14)      
        First lien senior secured loan ($11.2 par due 8/2023)   7.58%
(Libor + 4.75%/Q)
    8/31/2018     11.2     11.2 (2)(14)      
        Series A preferred stock (1,272 shares)         10/24/2014     0.7     1.0 (2)      
                        58.3     58.6        
                                       
Frontline Technologies Group Holding LLC, Frontline Technologies Blocker Buyer, Inc., Frontline Technologies Holdings, LLC and Frontline Technologies Parent, LLC(18)   Provider of human capital management ("HCM") and SaaS-based software solutions to employees and administrators of K-12 school organizations   First lien senior secured loan ($19.4 par due 9/2023)   9.02%
(Libor + 6.50%/M)
    9/19/2017     19.1     19.4 (2)(14)      
        Class A preferred units (4,574 units)         9/18/2017     4.6     5.6        
        Class B common units         9/18/2017         0.8        
                        23.7     25.8        
                                       
Infilaw Holding, LLC(18)   Operator of for-profit law schools   First lien senior secured revolving loan ($5.0 par due 9/2022)         8/25/2011     4.2     (2)(13)(17)      
                                       
Instituto de Banca y Comercio, Inc. & Leeds IV Advisors, Inc.   Private school operator   First lien senior secured loan ($12.3 par due 10/2020)         10/31/2015     12.3     12.3 (2)      
        Senior preferred series A-1 shares (163,902 shares)         10/31/2015     119.4     18.2 (2)      
        Series B preferred stock (1,401,385 shares)         8/5/2010     4.0     (2)      
        Series B preferred stock (348,615 shares)         8/5/2010     1.0     (2)      
        Series C preferred stock (1,994,644 shares)         6/7/2010     0.5     (2)      
        Series C preferred stock (517,942 shares)         6/7/2010     0.1     (2)      
        Common stock (16 shares)         6/7/2010         (2)      
        Common stock (4 shares)         6/7/2010         (2)      
                        137.3     30.5        
                                       
Liaison Acquisition, LLC(18)   Provider of centralized applications services to educational associations   Second lien senior secured loan ($5.3 par due 8/2023)   11.72%
(Libor + 9.25%/M)
    2/9/2017     5.2     5.3 (2)(14)      
                                       
PIH Corporation and Primrose Holding Corporation(6)(18)   Franchisor of education-based early childhood centers   First lien senior secured revolving loan ($1.0 par due 12/2020)   7.88%
(Libor + 5.50%/M)
    12/13/2013     1.0     1.0 (2)(14)      
        First lien senior secured loan ($1.6 par due 12/2020)   7.85%
(Libor + 5.50%/M)
    12/15/2017     1.6     1.6 (2)(14)      
        Common stock (7,227 shares)         1/3/2017     10.7     23.0        
                        13.3     25.6        
                                     

F-229


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
R3 Education Inc., Equinox EIC Partners LLC and Sierra Education Finance Corp.   Medical school operator   Common membership interest (15.76% interest)         9/21/2007     15.8     15.8 (2)      
        Warrant to purchase up to 27,890 shares (expires 11/2019)         12/8/2009         7.5 (2)      
                        15.8     23.3        
                                       
Raptor Technologies, LLC and Rocket Parent, LLC(18)   Provider of SaaS-based safety and security software to the K-12 school market   First lien senior secured loan ($16.1 par due 12/2024)   8.46%
(Libor + 6.00%/M)
    12/17/2018     16.1     15.9 (2)(14)      
        Class A common units (2,294,000 units)         12/17/2018     2.3     2.3        
                        18.4     18.2        
                                       
Regent Education, Inc.   Provider of software solutions designed to optimize the financial aid and enrollment processes   Warrant to purchase up to 987 shares of common stock (expires 12/2026)         12/23/2016         (2)      
        Warrant to purchase up to 5,393,194 shares of common stock (expires 12/2026)         12/23/2016         (2)      
                                   
                                       
RuffaloCODY, LLC(18)   Provider of student fundraising and enrollment management services   First lien senior secured revolving loan       5/29/2013         (2)(16)      
                                       
Severin Acquisition, LLC(18)   Provider of student information system software solutions to the K-12 education market   Second lien senior secured loan ($80.0 par due 8/2026)   9.13% (Libor + 6.75%/M)     6/12/2018     79.2     77.6 (2)(14)      
                        364.7     272.9     3.74 %
                                       
Containers and Packaging                                      
GS Pretium Holdings, Inc.   Manufacturer and supplier of high performance plastic containers   Common stock (500,000 shares)         6/2/2014     0.5     1.0 (2)      
                                       
LBP Intermediate Holdings LLC(18)   Manufacturer of paper and corrugated foodservice packaging   First lien senior secured revolving loan       7/10/2015         (16)      
        First lien senior secured loan ($11.5 par due 7/2020)   8.12%
(Libor + 5.50%/Q)
    11/13/2018     11.4     11.3 (2)(14)      
        First lien senior secured loan ($11.8 par due 7/2020)   8.30%
(Libor + 5.50%/Q)
    7/10/2015     11.7     11.7 (3)(14)      
        First lien senior secured loan ($5.0 par due 7/2020)   8.30%
(Libor + 5.50%/Q)
    7/10/2015     5.0     4.9 (4)(14)      
                        28.1     27.9        
                                       
Microstar Logistics LLC, Microstar Global Asset Management LLC, and MStar Holding Corporation   Keg management solutions provider   Second lien senior secured loan ($57.5 par due 8/2021)   10.02%
(Libor + 7.50%/M)
    12/14/2012     57.5     57.5 (2)(14)      
        Second lien senior secured loan ($75.0 par due 8/2021)   10.02%
(Libor + 7.50%/M)
    12/14/2012     75.0     75.0 (3)(14)      
        Second lien senior secured loan ($10.0 par due 8/2021)   10.02%
(Libor + 7.50%/M)
    12/14/2012     10.0     10.0 (4)(14)      
        Common stock (54,710 shares)         12/14/2012     4.9     8.2 (2)      
                        147.4     150.7        
                                     

F-230


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
NSI Holdings, Inc.(6)   Manufacturer of plastic containers for the wholesale nursery industry   Series A preferred stock (2,192 shares)         1/3/2017                
Ranpak Corp.   Manufacturer and marketer of paper-based protective packaging systems and materials   Second lien senior secured loan ($8.0 par due 10/2022)   9.71%
(Libor + 7.25%/M)
    1/3/2017     7.8     8.0 (2)(14)      
                                       
SCI PH Parent, Inc.   Industrial container manufacturer, reconditioner and servicer   Series B shares (11.4764 shares)         8/24/2018     1.1     1.8 (2)      
                        184.9     189.4     2.60 %
                                       
Environmental Services                                      
MPH Energy Holdings, LP   Operator of municipal recycling facilities   Limited partnership interest (3.13% interest)         1/8/2014         (2)      
                                       
RE Community Holdings GP, LLC and RE Community Holdings, LP   Operator of municipal recycling facilities   Limited partnership interest (2.86% interest)         3/1/2011         (2)      
        Limited partnership interest (2.49% interest)         3/1/2011         (2)      
                                   
                                       
Soil Safe, Inc. and Soil Safe Acquisition Corp.(7)(18)   Provider of soil treatment, recycling and placement services   First lien senior secured revolving loan       1/3/2017         (16)      
        First lien senior secured loan ($18.0 par due 1/2020)   8.77%
(Libor + 6.25%/M)
    1/3/2017     18.0     18.0 (2)(14)      
        Second lien senior secured loan ($12.7 par due 6/2020)   10.75%
(Libor + 7.75%/M)
    1/3/2017     12.7     12.7 (2)(14)      
        Senior subordinated loan ($43.4 par due 12/2020)   16.50% PIK     1/3/2017     43.4     43.4 (2)      
        Senior subordinated loan ($36.5 par due 12/2020)   14.50% PIK     1/3/2017     36.5     36.5 (2)      
        Senior subordinated loan ($36.4 par due 12/2020)         1/3/2017     11.5     10.2 (2)(13)      
        Common stock (810 shares)         1/3/2017                
                        122.1     120.8        
                        122.1     120.8     1.66 %
                                       
Aerospace and Defense                                      
Cadence Aerospace, LLC(18)   Aerospace precision components manufacturer   First lien senior secured revolving loan       11/14/2017         (16)      
        First lien senior secured loan ($32.2 par due 11/2023)   9.11%
(Libor + 6.50%/Q)
    11/14/2017     31.9     32.2 (3)(14)      
        First lien senior secured loan ($10.0 par due 11/2023)   8.91%
(Libor + 6.50%/Q)
    7/5/2018     10.0     10.0 (2)(14)      
                        41.9     42.2        
                                       
MB Aerospace Holdings II Corp.   Aerospace engine components manufacturer   Second lien senior secured loan ($68.4 par due 1/2026)   11.30% (Libor + 8.50%/Q)     1/22/2018     68.4     68.4 (2)(14)      
                        110.3     110.6     1.52 %
                                       
Chemicals                                      
AMZ Holding Corp.(18)   Specialty chemicals manufacturer   First lien senior secured loan ($12.0 par due 6/2022)   7.52%
(Libor + 5.00%/M)
    6/27/2017     12.0     12.0 (4)(14)      
                                       
Genomatica, Inc.   Developer of a biotechnology platform for the production of chemical products   Warrant to purchase 322,422 shares of Series D preferred stock (expires 3/2023)         3/28/2013         (2)      
                                     

F-231


Table of Contents

Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Plaskolite PPC Intermediate II LLC and Plaskolite PPC Blocker LLC   Manufacturer of specialized acrylic and polycarbonate sheets   First lien senior secured loan ($25.0 par due 12/2025)   6.69%
(Libor + 4.25%/Q)
    12/14/2018     24.5     24.5 (2)(14)      
        Second lien senior secured loan ($55.7 par due 12/2026)   10.19%
(Libor + 7.75%/M)
    12/14/2018     55.7     54.6 (2)(14)      
        Co-Invest units (5,969 units)         12/14/2018     0.6     0.6        
                        80.8     79.7        
                        92.8     91.7     1.26 %
                                       
Printing, Publishing and Media                                      
Connoisseur Media, LLC   Owner and operator of radio stations   First lien senior secured loan ($13.5 par due 6/2019)   8.80%
(Libor + 6.38%/Q)
    7/26/2017     13.5     13.5 (2)(14)      
        First lien senior secured loan ($23.6 par due 6/2019)   8.90%
(Libor + 6.38%/Q)
    7/26/2017     23.6     23.6 (2)(14)      
        First lien senior secured loan ($10.1 par due 6/2019)   8.90%
(Libor + 6.38%/Q)
    7/26/2017     10.1     10.1 (4)(14)      
                        47.2     47.2        
                                       
Roark-Money Mailer LLC   Marketer, advertiser and distributor of coupons in the mail industry   Membership units (35,000 units)         1/3/2017                
                                       
The Teaching Company Holdings, Inc.   Education publications provider   Preferred stock (10,663 shares)         9/29/2006     1.1     (2)      
        Common stock (15,393 shares)         9/29/2006         (2)      
                        1.1            
                        48.3     47.2     0.65 %
                                       
Computers and Electronics                                      
Everspin Technologies, Inc.   Designer and manufacturer of computer memory solutions   Warrant to purchase up to 18,461 shares of common stock (expires 10/2026)         10/7/2016     0.4     (2)(21)      
                                       
Imaging Business Machines, L.L.C. and Scanner Holdings Corporation(7)   Provider of high-speed intelligent document scanning hardware and software   Senior subordinated loan ($8.3 par due 6/2022)   14.00%     1/3/2017     8.1     8.3 (2)      
        Senior subordinated loan ($8.3 par due 6/2022)   14.00%     1/3/2017     8.1     8.3 (2)      
        Series A preferred stock (66,424,135 shares)         1/3/2017         8.0        
        Class A common stock (33,173 shares)         1/3/2017                
        Class B common stock (134,214 shares)         1/3/2017                
                        16.2     24.6        
                                       
Zemax Software Holdings, LLC(18)   Provider of optical illumination design software to design engineers   First lien senior secured loan ($17.0 par due 6/2024)   8.55%
(Libor + 5.75%/Q)
    6/25/2018     17.0     16.9 (3)(14)      
                        33.6     41.5     0.57 %
                                     

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Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Farming and Agriculture                                      
QC Supply, LLC(18)   Specialty distributor and solutions provider to the swine and poultry markets   First lien senior secured revolving loan ($9.0 par due 12/2021)   8.52%
(Libor + 6.00%/M)
    12/29/2016     9.0     8.5 (2)(14)      
        First lien senior secured loan ($8.7 par due 12/2022)   8.52%
(Libor + 6.00%/M)
    12/29/2016     8.7     8.2 (2)(14)      
        First lien senior secured loan ($11.1 par due 12/2022)   8.52%
(Libor + 6.00%/M)
    12/29/2016     11.1     10.5 (2)(14)      
        First lien senior secured loan ($14.7 par due 12/2022)   8.52%
(Libor + 6.00%/M)
    12/29/2016     14.7     13.9 (4)(14)      
                        43.5     41.1        
                        43.5     41.1     0.56 %
                                       
Retail                                      
Paper Source, Inc. and Pine Holdings, Inc.(18)   Retailer of fine and artisanal paper products   First lien senior secured revolving loan ($1.9 par due 9/2019)   10.50%
(Base Rate + 5.00%/Q)
    9/23/2013     1.9     1.9 (2)(14)      
        First lien senior secured loan ($9.3 par due 9/2019)   9.05%
(Libor + 6.25%/Q)
    9/23/2013     9.3     9.2 (4)(14)      
        Class A common stock (36,364 shares)         9/23/2013     6.0     2.2 (2)      
                        17.2     13.3        
                        17.2     13.3     0.18 %
                                       
Health Clubs                                      
Athletic Club Holdings, Inc.   Premier health club operator   First lien senior secured loan ($3.2 par due 10/2020)   10.84%
(Libor + 8.50%/Q)
    10/11/2007     3.2     3.2 (3)(14)      
                                       
CFW Co-Invest, L.P. and NCP Curves, L.P.   Health club franchisor   Limited partnership interest (4,152,165 shares)         7/31/2012     4.2     10.7 (2)      
        Limited partnership interest (2,218,235 shares)         7/31/2012         (2)(8)      
                        4.2     10.7        
                                       
Movati Athletic (Group) Inc.(8)(18)   Premier health club operator   First lien senior secured loan ($0.5 par due 10/2022)   6.50%
(CIBOR + 4.50%/Q)
    10/5/2017     0.6     0.5 (2)(14)      
        First lien senior secured loan ($2.8 par due 10/2022)   6.50%
(CIBOR + 4.50%/Q)
    10/5/2017     3.0     2.8 (2)(14)      
                        3.6     3.3        
                                       
Sunshine Sub, LLC(18)   Premier health club operator   First lien senior secured loan ($9.8 par due 5/2024)   7.27%
(Libor + 4.75%/M)
    5/25/2018     9.8     9.7 (2)(14)      
                                       
Taymax Group Acquisition, LLC and TCP Fit Parent, L.P.(18)   Planet Fitness franchisee   First lien senior secured revolving loan ($0.1 par due 7/2024)   7.10%
(Libor + 4.75%/M)
    7/31/2018     0.1     0.1 (2)(14)      
        First lien senior secured revolving loan ($0.1 par due 7/2024)   6.89%
(Libor + 4.75%/M)
    7/31/2018     0.1     0.1 (2)(14)      
        First lien senior secured loan ($4.3 par due 7/2025)   7.55%
(Libor + 4.75%/Q)
    7/31/2018     4.3     4.2 (2)(14)      
        Class A units (30,000 units)         7/31/2018     3.0     3.3        
                        7.5     7.7        
                        28.3     34.6     0.47 %
                                     

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Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Hotel Services                                      
Pyramid Management Advisors, LLC and Pyramid Investors, LLC(18)   Hotel Operator   First lien senior secured revolving loan ($1.7 par due 7/2021)   9.21%
(Libor + 6.75%/M)
    4/12/2018     1.7     1.7 (2)(14)(17)      
        First lien senior secured revolving loan ($0.1 par due 7/2021)   9.27%
(Libor + 6.75%/M)
    4/12/2018     0.1     0.1 (2)(14)(17)      
        First lien senior secured loan ($1.5 par due 7/2021)   9.27%
(Libor + 6.75%/M)
    4/12/2018     1.5     1.5 (2)(14)      
        First lien senior secured loan ($17.0 par due 7/2021)   9.27%
(Libor + 6.75%/M)
    4/12/2018     17.0     17.0 (2)(14)      
        Preferred membership units (996,833 units)         7/15/2016     1.0     (2)      
                        21.3     20.3        
                        21.3     20.3     0.28 %
                                       
Telecommunications                                      
CHL, LTD.   Repair and service solutions provider for cable, satellite and telecommunications based service providers   Warrant to purchase up to 120,000 shares of Series A common stock (expires 5/2020)         1/3/2017                
        Warrant to purchase up to 280,000 shares of Series B common stock (expires 5/2020)         1/3/2017                
        Warrant to purchase up to 80,000 shares of Series C common stock (expires 5/2020)         1/3/2017                
                                   
                                       
Extenet Systems, Inc.(18)   Provider of antenna networks for use by wireless service providers, government agencies, healthcare organizations and other commercial enterprises   First lien senior secured revolving loan       2/8/2018         (16)      
                                       
LTG Acquisition, Inc.   Designer and manufacturer of display, lighting and passenger communication systems for mass transportation markets   Class A membership units (5,000 units)         1/3/2017     5.1     4.1        
                                       
Startec Equity, LLC(7)   Communication services   Member interest         4/1/2010                
                                       
TowerCo IV Finance LLC(18)   Owner and operator of cellular telecommunications towers   First lien senior secured revolving loan ($7.2 par due 10/2021)   6.01%
(Libor + 3.50%/M)
    2/8/2018     7.2     7.2 (2)(14)      
        First lien senior secured revolving loan ($1.2 par due 10/2021)   5.85%
(Libor + 3.50%/M)
    2/8/2018     1.2     1.2 (2)(14)      
                        8.4     8.4        
                        13.5     12.5     0.17 %
                                       
Commercial Real Estate Financial                                      
ACAS Real Estate Holdings Corporation(7)   Real estate holding company   Common stock (1,000 shares)         1/3/2017     2.6     2.0        
                                       
NECCO Realty Investments LLC(7)   Real estate holding company   Membership units (7,450 units)         1/3/2017                
                        2.6     2.0     0.03 %
                                     

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Company(1)
  Business Description   Investment   Interest(5)(9)   Acquisition
Date
  Amortized
Cost
  Fair
Value
  Percentage
of Net
Assets
 
Housing and Building Materials                                      
Halex Holdings, Inc.(7)(18)   Manufacturer of flooring installation products   First lien senior secured revolving loan ($1.9 par due 12/2018)       1/24/2017     1.9            
        Common stock (51,853 shares)         1/3/2017                
                        1.9            
                        1.9         0.00 %
                                       
Total Investments                     $ 12,753.8   $ 12,416.7     170.17 %

Derivative Instruments

Foreign currency forward contracts

Description
  Notional Amount
to be Purchased
  Notional Amount
to be sold
  Counterparty   Settlement Date   Unrealized Appreciation /
(Depreciation)
 

Foreign currency forward contract

  $ 4   CAD 5   Bank of Montreal     1/4/2019   $  

Foreign currency forward contract

  $ 7   CAD 9   Bank of Montreal     1/14/2019      

Foreign currency forward contract

  $ 78   CAD 103   Bank of Montreal     2/15/2019     2  

Foreign currency forward contract

  $ 25   CAD 33   Bank of Montreal     3/22/2019      

Foreign currency forward contract

  $ 17   15   Bank of Montreal     1/14/2019      

Foreign currency forward contract

  $ 1   1   Bank of Montreal     2/15/2019      

Foreign currency forward contract

  $ 27   24   Bank of Montreal     3/6/2019      

Foreign currency forward contract

  $ 94   £ 72   Bank of Montreal     2/15/2019     2  

Total

                        $ 4  

Interest rate swap

Description
  Payment Terms   Counterparty   Maturity Date   Notional
Amount
  Value   Upfront
Payments/
Receipts
  Unrealized Appreciation /
(Depreciation)
 

Interest rate swap

  Pay fixed 2.0642%   Receive Floating One-Month LIBOR of 2.44%   Bank of Montreal   January 4, 2021   $ 395   $ 4   $   $ 4  

Total

                                    $ 4  

(1)
Other than the Company's investments listed in footnote 7 below (subject to the limitations set forth therein), the Company does not "Control" any of its portfolio companies, for the purposes of the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the "Investment Company Act"). In general, under the Investment Company Act, the Company would "Control" a portfolio company if the Company owned more than 25% of its outstanding voting securities (i.e., securities with the right to elect directors) and/or had the power to exercise control over the management or policies of such portfolio company. All of the Company's portfolio company investments, which as of December 31, 2018 represented 170% of the Company's net assets or 96% of the Company's total assets, are subject to legal restrictions on sales.

(2)
These assets are pledged as collateral for the Revolving Credit Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than the Company's obligations under the Revolving Credit Facility (see Note 5).

(3)
These assets are owned by the Company's consolidated subsidiary Ares Capital CP Funding LLC ("Ares Capital CP"), are pledged as collateral for the Revolving Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than Ares Capital CP's obligations under the Revolving Funding Facility (see Note 5).

(4)
These assets are owned by the Company's consolidated subsidiary Ares Capital JB Funding LLC ("ACJB"), are pledged as collateral for the SMBC Funding Facility (as defined below) and, as a result, are not directly available to the creditors of the Company to satisfy any obligations of the Company other than ACJB's obligations under the SMBC Funding Facility (see Note 5).

(5)
Investments without an interest rate are non-income producing

(6)
As defined in the Investment Company Act, the Company is deemed to be an "Affiliated Person" because it owns 5% or more of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company (including through a management

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    agreement). Transactions as of and during the year ended December 31, 2018 in which the issuer was an Affiliated Person (but not a portfolio company that the Company is deemed to Control) are as follows:

 
  For the Year Ended December 31, 2018   As of December 31, 2018  
 
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service fees
  Dividend
income
  Other
income
  Net realized
gains (losses)
  Net
unrealized
gains (losses)
 
(in millions)
Company
  Fair Value  

Blue Wolf Capital Fund II, L.P. 

  $   $ 1.4   $   $   $   $   $   $   $ 0.3   $ 2.5  

Campus Management Acquisition Corp.

  $   $   $ 10.5   $   $   $   $   $ 3.2   $ (0.5 ) $ 0.1  

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC

  $ 18.8   $ 7.3   $   $ 2.4   $   $   $ 0.2   $   $ (1.0 ) $ 39.0  

ESCP PPG Holdings, LLC

  $   $   $   $   $   $   $   $   $ (0.4 ) $ 2.4  

European Capital UK SME Debt LP

  $ 7.2   $ 9.7   $   $   $   $ 2.0   $   $   $ 0.3   $ 39.5  

Financial Asset Management Systems, Inc. and FAMS Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Imperial Capital Private Opportunities, LP

  $ 0.1   $ 1.1   $   $   $   $ 2.1   $   $ 12.0   $ (13.9 ) $  

Ioxus, Inc

  $   $ 4.4   $   $ 1.0   $   $   $   $ 0.1   $ (0.1 ) $ 7.0  

NSI Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Panda Temple Power, LLC and T1 Power Holdings LLC

  $   $ 0.4   $   $ 0.7   $   $   $   $   $ 3.2   $ 21.9  

Partnership Capital Growth Fund I, L.P.

  $   $   $   $   $   $   $   $   $   $ 0.1  

PCG-Ares Sidecar Investment, L.P.

  $ 0.1   $   $   $   $   $   $   $   $ (0.9 ) $ 4.4  

PCG-Ares Sidecar Investment II, L.P.

  $   $ 0.9   $   $   $   $   $   $   $ 6.7   $ 17.4  

Petroflow Energy Corporation and TexOak Petro Holdings LLC

  $   $ 3.1   $   $ 0.1   $   $   $   $ 0.2   $ (1.0 ) $ 8.3  

PIH Corporation and Primrose Holding Corporation

  $   $   $   $ 0.2   $   $   $   $   $ 5.2   $ 25.6  

Qualium Investissement

  $   $ 0.7   $   $   $   $   $   $ 0.9   $ (0.7 ) $  

Shock Doctor, Inc. and Shock Doctor Holdings, LLC

  $   $   $   $ 12.0   $   $   $ 0.3   $   $ (4.6 ) $ 81.5  

Things Remembered, Inc. and TRM Holdco Corp.

  $ 3.0   $ 1.6   $ 17.8   $ 0.1   $   $   $   $ (15.9 ) $ 15.1   $  

UL Holding Co., LLC

  $   $   $   $ 3.5   $   $   $   $   $ (3.7 ) $ 42.2  

  $ 29.2   $ 30.6   $ 28.3   $ 20.0   $   $ 4.1   $ 0.5   $ 0.5   $ 4.0   $ 291.9  
(7)
As defined in the Investment Company Act, the Company is deemed to be both an "Affiliated Person" and "Control" this portfolio company because it owns more than 25% of the portfolio company's outstanding voting securities or it has the power to exercise control over the management or policies of such portfolio company

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    (including through a management agreement). Transactions as of and during the year ended December 31, 2018 in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to Control are as follows:

 
  For the Year Ended December 31, 2018   As of
December 31,
2018
 
 
  Purchases
(cost)
  Redemptions
(cost)
  Sales
(cost)
  Interest
income
  Capital
structuring
service fees
  Dividend
income
  Other
income
  Net realized
gains (losses)
  Net
unrealized
gains (losses)
 
(in millions)
Company
  Fair Value  

ACAS Equity Holdings Corporation

  $   $   $   $   $   $   $   $   $ 0.1   $ 0.4  

ACAS Real Estate Holdings Corporation

  $   $   $   $   $   $   $   $   $ (0.2 ) $ 2.0  

ADF Capital, Inc., ADF Restaurant Group, LLC, and ARG Restaurant Holdings, Inc.

  $   $   $   $ 1.0   $   $   $   $   $ (11.2 ) $ 5.5  

Alcami Holdings, LLC

  $ 4.4   $ 125.1   $ 166.1   $ 19.5   $   $   $ 8.0   $ 323.9   $ (166.8 ) $  

Ares IIIR/IVR CLO Ltd.

  $   $   $   $   $   $   $   $   $   $  

Callidus Capital Corporation

  $   $   $ 3.0   $   $   $   $   $ (0.8 ) $ 1.3   $  

Champion Parent Corporation and Calera XVI, LLC

  $   $ 0.8   $   $   $   $   $   $ (0.7 ) $ 0.6   $  

CoLTS 2005-1

  $   $   $   $   $   $   $   $   $   $  

CoLTS 2005-2

  $   $   $   $   $   $   $   $   $   $  

Columbo Midco Limited, Columbo Bidco Limited and Columbo Topco Limited

  $   $   $ 27.9   $   $   $   $   $ 6.2   $ (12.7 ) $  

CSHM LLC

  $   $   $   $   $   $   $   $   $   $  

Eckler Industries, Inc. and Eckler Purchaser LLC

  $ 1.3   $   $   $   $   $   $   $ (2.0 ) $ 5.4   $ 22.7  

ETG Holdings, Inc.

  $   $   $   $   $   $   $   $   $   $  

Fashion Holding Luxembourg SCA (Modacin/Camaeiu)

  $   $   $   $   $   $   $   $   $   $  

FPI Holding Corporation

  $   $ 0.4   $   $   $   $   $   $ (0.4 ) $ 1.0   $  

Halex Holdings, Inc.

  $ 0.8   $   $   $   $   $   $   $   $   $  

HCI Equity, LLC

  $   $   $   $   $   $   $   $   $   $ 0.1  

Imaging Business Machines, L.L.C. and Scanner Holdings Corporation

  $   $   $   $ 2.4   $   $   $ 0.6   $   $ 3.4   $ 24.6  

Ivy Hill Asset Management, L.P.

  $ 263.0   $ 63.0   $   $ 1.0   $   $ 58.0   $   $   $ 2.8   $ 517.9  

Joyce Lane Capital LLC

  $ 0.8   $ 26.2   $   $ 0.6   $   $   $   $ (5.9 ) $ (3.0 ) $ 3.9  

LLSC Holdings Corporation (dba Lawrence Merchandising Services)

  $   $ 17.4   $   $   $   $   $   $   $ (0.3 ) $ 0.4  

Miles 33 (Finance) Limited

  $   $ 15.0   $   $ 1.6   $   $   $   $ (4.3 ) $ (3.9 ) $  

Montgomery Lane, LLC and Montgomery Lane, Ltd.

  $   $   $   $   $   $   $   $   $ (0.6 ) $  

MVL Group, Inc.

  $   $   $   $   $   $   $   $   $   $  

Navisun LLC and Navisun Holdings LLC

  $ 23.5   $   $   $ 1.3   $ 0.3   $ 0.2   $ 0.2   $   $   $ 27.9  

NECCO Holdings, Inc. and New England Confectionery Company, Inc.

  $ 14.4   $ 14.7   $   $   $   $   $   $   $ (5.7 ) $ 4.6  

NECCO Realty Investments LLC

  $   $   $   $   $   $   $   $   $   $  

Orion Foods, LLC

  $   $   $   $   $   $   $   $   $   $ 0.4  

PHL Investors, Inc., and PHL Holding Co.

  $   $   $   $   $   $   $   $   $   $  

Rug Doctor, LLC and RD Holdco Inc.

  $   $   $   $ 2.1   $   $   $   $   $ 0.3   $ 28.1  

S Toys Holdings LLC (fka The Step2 Company, LLC)

  $   $   $   $   $   $   $   $   $ (0.1 ) $ 0.4  

Senior Direct Lending Program, LLC

  $ 252.2   $ 87.6   $   $ 86.9   $ 11.6   $   $ 4.2   $   $   $ 651.7  

Singer Sewing Company, SVP-Singer Holdings, LLC and SVP-Singer Holdings LP

  $ 98.0   $ 21.5   $   $ 13.6   $ 1.3   $   $ 4.6   $   $ (6.8 ) $ 235.6  

Soil Safe, Inc. and Soil Safe Acquisition Corp.

  $   $ 4.0   $   $ 14.8   $   $   $ 0.4   $   $ 6.2   $ 120.7  

Startec Equity, LLC

  $   $   $   $   $   $   $   $   $   $  

The Greeley Company, Inc. and HCP Acquisition Holdings, LLC

  $   $ 0.1   $   $   $   $   $   $   $   $  

  $ 658.4   $ 375.8   $ 197.0   $ 144.8   $ 13.2   $ 58.2   $ 18.0   $ 316.0   $ (190.2 ) $ 1,646.9  

*
Together with Varagon Capital Partners ("Varagon") and its clients, the Company has co-invested through the Senior Direct Lending Program LLC (d/b/a the "Senior Direct Lending Program" or the "SDLP"). The SDLP has been capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of the Company and Varagon (with approval from a representative of each required); therefore, although the Company owns more than 25% of the voting securities of the SDLP, the Company does not believe that it has control over the SDLP (for purposes of the Investment Company Act or otherwise) because, among other things, these "voting securities" do not afford the Company the right to elect directors of the SDLP or any other special rights (see Note 4).
(8)
This portfolio company is not a qualifying asset under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of the Company's total assets. Pursuant to Section 55(a) of the Investment Company Act 14% of the Company's total assets are represented by investments at fair value and other assets that are considered "non-qualifying assets" as of December 31, 2018.

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(9)
Variable rate loans to the Company's portfolio companies bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate ("LIBOR") or an alternate base rate (commonly based on the Federal Funds Rate or the Prime Rate), at the borrower's option, which reset annually (A), semi-annually (S), quarterly (Q), bi-monthly (B), monthly (M) or daily (D). For each such loan, the Company has provided the interest rate in effect on the date presented.

(10)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on $69.5 in aggregate principal amount of a "first out" tranche of the portfolio company's senior term debt previously syndicated by the Company into "first out" and "last out" tranches, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(11)
In addition to the interest earned based on the stated interest rate of this security, the Company is entitled to receive an additional interest amount of 2.00% on $38.7 in aggregate principal amount of a "first out" tranche of the portfolio company's first lien senior secured loans, whereby the "first out" tranche will have priority as to the "last out" tranche with respect to payments of principal, interest and any other amounts due thereunder.

(12)
The Company sold a participating interest of approximately $2.0 in aggregate principal amount of the portfolio company's first lien senior secured term loan. As the transaction did not qualify as a "true sale" in accordance with U.S. generally accepted accounting principles, the Company recorded a corresponding $2.0 secured borrowing included in "accounts payable and other liabilities" in the accompanying consolidated balance sheet.

(13)
Loan was on non-accrual status as of December 31, 2018.

(14)
Loan includes interest rate floor feature.

(15)
In addition to the interest earned based on the stated contractual interest rate of this security, the certificates entitle the holders thereof to receive a portion of the excess cash flow from the SDLP's loan portfolio, after expenses, which may result in a return to the Company greater than the contractual stated interest rate.

(16)
As of December 31, 2018, no amounts were funded by the Company under this first lien senior secured revolving loan; however, there were letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 for further information on letters of credit commitments related to certain portfolio companies.

(17)
As of December 31, 2018, in addition to the amounts funded by the Company under this first lien senior secured revolving loan, there were also letters of credit issued and outstanding through a financial intermediary under the loan. See Note 7 for further information on letters of credit commitments related to certain portfolio companies.

(18)
As of December 31, 2018, the Company had the following commitments to fund various revolving and delayed draw senior secured and subordinated loans, including commitments to issue letters of credit through a financial intermediary on behalf of certain portfolio companies. Such commitments are subject to the satisfaction of certain conditions set forth in the documents governing these loans and letters of credit and there can be no assurance that such conditions will be satisfied. See Note 7 for further information on revolving and delayed draw loan commitments, including commitments to issue letters of credit, related to certain portfolio companies.
(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

1A Smart Start, LLC

  $ 3.5   $ (0.1 ) $ 3.4   $   $   $ 3.4  

42 North Dental, LLC (fka Gentle Communications, LLC)

    5.0         5.0             5.0  

A.U.L. Corp.

    1.2         1.2             1.2  

Accommodations Plus Technologies LLC

    4.1         4.1             4.1  

Achilles Acquisition LLC

    12.4         12.4             12.4  

ADCS Billings Intermediate Holdings, LLC

    5.0     (1.3 )   3.7             3.7  

ADF Capital, Inc.

    1.3         1.3             1.3  

ADG, LLC

    13.7     (11.2 )   2.5             2.5  

Alcami Corporation

    29.0     (3.5 )   25.5             25.5  

AMCP Clean Intermediate, LLC

    4.7     (1.2 )   3.5             3.5  

American Academy Holdings, LLC

    7.0     (0.9 )   6.1             6.1  

AMZ Holding Corp.

    3.4         3.4             3.4  

Apex Clean Energy Holdings, LLC

    5.0     (5.0 )                

Avetta, LLC

    7.0         7.0             7.0  

Bambino CI Inc.

    9.6     (0.3 )   9.3             9.3  

Blue Campaigns Intermediate Holding Corp.

    3.0         3.0             3.0  

Cadence Aerospace, LLC

    14.3     (0.5 )   13.8             13.8  

Capstone Logistics Acquisition, Inc.

    2.0     (0.9 )   1.1             1.1  

Care Hospice, Inc

    2.3     (0.3 )   2.0             2.0  

CB Trestles OpCo, LLC

    32.2         32.2             32.2  

CCS-CMGC Holdings, Inc.

    12.0     (7.9 )   4.1             4.1  

Center for Autism and Related Disorders, LLC

    8.5     (0.4 )   8.1             8.1  

Centric Brands Inc.

                         

Chariot Acquisition, LLC

    1.0         1.0             1.0  

Chesapeake Research Review, LLC

    5.8         5.8             5.8  

Clearwater Analytics, LLC

    5.0         5.0             5.0  

Command Alkon Incorporated

    6.3     (3.0 )   3.3             3.3  

Comprehensive EyeCare Partners, LLC

    3.7     (0.2 )   3.5             3.5  

Corepoint Health, LLC

    4.3         4.3             4.3  

Cozzini Bros., Inc. and BH-Sharp Holdings LP

    24.2     (1.5 )   22.7             22.7  

Crown Health Care Laundry Services, LLC and Crown Laundry Holdings, LLC

    7.5     (0.9 )   6.6             6.6  

CST Buyer Company

    4.2         4.2             4.2  

D4C Dental Brands, Inc.

    5.0     (3.3 )   1.7             1.7  

DCA Investment Holding, LLC

    5.8     (0.4 )   5.4             5.4  

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Table of Contents

(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

DecoPac, Inc.

    8.1         8.1             8.1  

DFC Global Facility Borrower II LLC

    115.0     (94.6 )   20.4             20.4  

DGH Borrower LLC

    22.5         22.5             22.5  

Dorner Holding Corp.

    3.3     (0.2 )   3.1             3.1  

Doxim Inc.

    2.4         2.4             2.4  

DRB Holdings, LLC

    9.9     (3.3 )   6.6             6.6  

DTI Holdco, Inc. and OPE DTI Holdings, Inc.

    8.8     (2.2 )   6.6             6.6  

Eckler Industries, Inc.

    2.0     (1.3 )   0.7     (0.8 )       (0.1 )

Emergency Communications Network, LLC

    6.5         6.5             6.5  

Emerus Holdings, Inc.

    4.5     (3.0 )   1.5             1.5  

EN Engineering, LLC

    5.0         5.0             5.0  

Entertainment Partners, LLC and Entertainment Partners Canada Inc.

    28.0         28.0             28.0  

Episerver, Inc.

    10.3         10.3             10.3  

ExteNet Systems, Inc.

    2.0         2.0             2.0  

Ferraro Fine Foods Corp.

    9.8     (1.3 )   8.5             8.5  

Flinn Scientific, Inc.

    10.0         10.0             10.0  

Flow Control Solutions, Inc.

    14.4     (0.4 )   14.0             14.0  

FM:Systems Group, LLC

    1.4         1.4             1.4  

Foundation Risk Partners, Corp.

    25.0         25.0             25.0  

Frontline Technologies Group Holding LLC

    8.4         8.4             8.4  

FWR Holding Corporation

    2.1     (0.8 )   1.3             1.3  

Garden Fresh Restaurant Corp.

    7.5     (3.5 )   4.0             4.0  

GB Auto Service, Inc.

    34.4         34.4             34.4  

Genesis Acquisition Co.

    9.4         9.4             9.4  

GraphPAD Software, LLC

    1.1         1.1             1.1  

GTCR-Ultra Acquisition, Inc. and GTCR-Ultra Holdings, LLC

    2.0         2.0             2.0  

HAI Acquisition Corporation

    19.0         19.0             19.0  

Halex Holdings, Inc.

    2.0     (1.9 )   0.1             0.1  

Harvey Tool Company, LLC

    38.7     (0.7 )   38.0             38.0  

Help/Systems Holdings, Inc.

    5.0     (1.0 )   4.0             4.0  

Hometown Food Company

    3.9         3.9             3.9  

Hygiena Borrower LLC

    12.4     (0.2 )   12.2             12.2  

IMIA Holdings, Inc.

    9.9     (0.4 )   9.5             9.5  

Implementation Management Assistance, LLC

    16.6     (5.5 )   11.1             11.1  

Infilaw Holding, LLC

    6.2     (6.2 )                

Infinite Electronics International, Inc.

    3.0         3.0             3.0  

Infogix, Inc.

    5.3         5.3             5.3  

iPipeline, Inc.

    4.0         4.0             4.0  

JDC Healthcare Management, LLC

    9.8     (0.8 )   9.0             9.0  

Jim N Nicks Management, LLC

    9.7     (2.8 )   6.9             6.9  

Joyce Lane Capital LLC and Joyce Lane Financing SPV LLC (fka Ciena Capital LLC)

    1.3         1.3             1.3  

Kaufman, Hall & Associates, LLC

    8.0         8.0             8.0  

KBHS Acquisition, LLC (d/b/a Alita Care, LLC)

    5.0     (4.6 )   0.4             0.4  

Key Surgical LLC

    2.8         2.8             2.8  

KHC Holdings, Inc.

    6.9     (0.7 )   6.2             6.2  

Labstat International Inc.

    3.8         3.8             3.8  

LBP Intermediate Holdings LLC

    0.9     (0.1 )   0.8             0.8  

Liaison Acquisition, LLC

    3.9         3.9             3.9  

Lone Wolf Real Estate Technologies Inc.

    3.0         3.0             3.0  

Mac Lean-Fogg Company

    24.2         24.2             24.2  

Magento, Inc.

    7.5     (0.2 )   7.3             7.3  

Masergy Holdings, Inc.

    2.5     (0.2 )   2.3             2.3  

Massage Envy, LLC

    11.2         11.2             11.2  

Mavis Tire Express Services Corp.

    23.3         23.3             23.3  

MB2 Dental Solutions, LLC

    3.5     (2.7 )   0.8             0.8  

McKenzie Sports Products, LLC

    4.5     (2.9 )   1.6             1.6  

Ministry Brands, LLC

    28.6         28.6             28.6  

Movati Athletic (Group) Inc.

    2.3         2.3             2.3  

MSHC, Inc.

    18.9     (1.6 )   17.3             17.3  

Murchison Oil and Gas, LLC

    20.0         20.0             20.0  

MW Dental Holding Corp.

    17.1     (7.0 )   10.1             10.1  

National Intergovernmental Purchasing Alliance Company

    9.0         9.0             9.0  

Navisun LLC

    20.8         20.8             20.8  

NECCO Holdings, Inc.

    25.0     (19.9 )   5.1     (5.1 )        

NM GRC HOLDCO, LLC

    1.4         1.4             1.4  

NMC Skincare Intermediate Holdings II, LLC

    17.4         17.4             17.4  

NMN Holdings III Corp

    12.5         12.5             12.5  

Nordco Inc.

    12.5     (1.3 )   11.2             11.2  

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Table of Contents

(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

NSM Sub Holdings Corp.

    6.6         6.6             6.6  

NueHealth Performance, LLC

    7.0         7.0             7.0  

Osmose Utilities Services, Inc.

    6.0     (2.5 )   3.5             3.5  

OTG Management, LLC

    16.3     (10.0 )   6.3             6.3  

Paper Source, Inc.

    2.5     (1.9 )   0.6             0.6  

Park Place Technologies, LLC

    5.4         5.4             5.4  

Pathway Vet Alliance LLC

    163.8         163.8             163.8  

Payment Alliance International, Inc.

    4.2     (3.4 )   0.8             0.8  

PDI TA Holdings, Inc.

    21.4         21.4             21.4  

Pegasus Intermediate Holdings, LLC

    5.0         5.0             5.0  

PIH Corporation and Primrose Holding Corporation

    3.3     (1.0 )   2.3             2.3  

Practice Insight, LLC

    2.9         2.9             2.9  

Premise Health Holding Corp.

    40.0     (6.0 )   34.0             34.0  

Pyramid Management Advisors, LLC

    5.5     (1.9 )   3.6             3.6  

QC Supply, LLC

    17.9     (9.0 )   8.9             8.9  

R1 RCM Inc.

    10.0         10.0             10.0  

Raptor Technologies, LLC

    10.1         10.1             10.1  

RecoveryDirect Acquisition, L.L.C.

    8.0         8.0             8.0  

Retriever Medical/Dental Payments LLC

    3.5         3.5             3.5  

Rialto Management Group, LLC

    1.0         1.0             1.0  

RMP Group, Inc.

    1.8         1.8             1.8  

RuffaloCODY, LLC

    7.7     (0.2 )   7.5             7.5  

Salter Labs

    1.7     (1.0 )   0.7             0.7  

Sanders Industries Holdings, Inc.

    10.0         10.0             10.0  

SCM Insurance Services Inc.

    4.0     (2.4 )   1.6             1.6  

SCSG EA Acquisition Company, Inc.

    4.0     (0.2 )   3.8             3.8  

SecurAmerica, LLC

    20.8         20.8             20.8  

Securelink, Inc

    3.0         3.0             3.0  

Severin Acquisition, LLC

    9.0         9.0             9.0  

SFE Intermediate Holdco LLC

    10.2         10.2             10.2  

Shift PPC LLC

    4.4         4.4             4.4  

Singer Sewing Company

    90.0     (77.9 )   12.1             12.1  

SiroMed Physician Services, Inc.

    7.1         7.1             7.1  

Siteworx Holdings, LLC

    1.5     (1.5 )                

SM Wellness Holdings, Inc.

    10.5         10.5             10.5  

Soil Safe, Inc. and Soil Safe Acquisition Corp.

    10.5     (3.6 )   6.9             6.9  

Sonny's Enterprises, LLC

    3.6     (0.2 )   3.4             3.4  

Sovos Brands Intermediate, Inc.

    4.3         4.3             4.3  

SpareFoot, LLC

    1.4     (0.3 )   1.1             1.1  

Sparta Systems, Inc.

    6.5         6.5             6.5  

Spectra Finance, LLC

    24.1     (5.5 )   18.6             18.6  

St. Croix Acquisition Corp.

    2.0         2.0             2.0  

Storm UK Holdco Limited and Storm US Holdco Inc.

    1.1         1.1             1.1  

Sunk Rock Foundry Partners LP

    10.0     (2.6 )   7.4             7.4  

Sunshine Sub, LLC

    7.7         7.7             7.7  

Symmetry Surgical Inc.

    3.1         3.1             3.1  

Synergy HomeCare Franchising, LLC

    4.2         4.2             4.2  

Syntax USA Acquisition Corporation

    3.3     (1.8 )   1.5             1.5  

Taymax Group Holdings, LLC

    3.2     (0.2 )   3.0             3.0  

TDG Group Holding Company

    20.7     (0.1 )   20.6             20.6  

Teasdale Foods, Inc.

    0.8     (0.7 )   0.1             0.1  

Telestream Holdings Corporation

    2.3     (0.6 )   1.7             1.7  

Teligent, Inc.

    22.8         22.8             22.8  

Tidi Products, LLC

    2.3         2.3             2.3  

Total Community Options, Inc.

    4.2         4.2             4.2  

Touchstone Acquisition, Inc.

    11.2         11.2             11.2  

Towerco IV Finance, LLC

    17.0     (8.4 )   8.6             8.6  

TPTM Merger Corp.

    4.3         4.3             4.3  

TU BidCo, Inc.

    18.5         18.5             18.5  

U.S. Acute Care Solutions, LLC

    1.7         1.7             1.7  

United Digestive MSO Parent, LLC

    17.2         17.2             17.2  

Urgent Cares of America Holdings I, LLC

    10.0         10.0             10.0  

Utility Pipeline, LTD.

    3.0     (0.1 )   2.9             2.9  

Vela Trading Technologies, LLC

    3.5     (0.5 )   3.0             3.0  

Verscend Holding Corp.

    22.5         22.5             22.5  

Veson Nautical LLC

    2.5         2.5             2.5  

Visual Edge Technology, Inc.

    0.8         0.8             0.8  

VLS Recovery Services, LLC

    20.6     (3.5 )   17.1             17.1  

VRC Companies, LLC

    3.1     (0.8 )   2.3             2.3  

WatchFire Enterprises, Inc.

    2.0         2.0             2.0  

West Dermatology, LLC

    18.3     (5.0 )   13.3             13.3  

WIRB—Copernicus Group, Inc

    3.0         3.0             3.0  

Woodstream Group, Inc. and Woodstream Corporation

    4.7         4.7             4.7  

Worldwide Facilities LLC

    2.3     (0.4 )   1.9             1.9  

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(in millions)
Portfolio Company
  Total revolving
and delayed draw
loan
commitments
  Less: drawn
commitments
  Total undrawn
commitments
  Less:
commitments
substantially at
discretion of the
Company
  Less: unavailable
commitments due
to borrowing base
or other covenant
restrictions
  Total net adjusted
undrawn revolving
and delayed draw
commitments
 

Wrench Group LLC

    2.8         2.8             2.8  

WSHP FC Acquisition LLC

    5.8     (3.3 )   2.5             2.5  

XIFIN, Inc.

    4.6         4.6             4.6  

Zemax Software Holdings, LLC

    4.1         4.1             4.1  

Zywave, Inc.

    11.5     (6.3 )   5.2             5.2  

  $ 1,915.3   $ (376.9 ) $ 1,538.4   $ (5.9 ) $   $ 1,532.5  
(19)
As of December 31, 2018, the Company was party to subscription agreements to fund equity investments in private equity investment partnerships as follows:
(in millions)
Company
  Total private
equity
commitments
  Less: funded
private equity
commitments
  Total
unfunded
private equity
commitments
  Less: private
equity
commitments
substantially at
the discretion of
the Company
  Total net
adjusted
unfunded
private
equity
commitments
 

Partnership Capital Growth Investors III, L.P. 

  $ 5.0   $ (4.9 ) $ 0.1   $   $ 0.1  

PCG-Ares Sidecar Investment, L.P. and PCG-Ares Sidecar Investment II, L.P.

    50.0     (12.4 )   37.6     (37.6 )    

Piper Jaffray Merchant Banking Fund I, L.P.

    2.0     (2.0 )            

European Capital UK SME Debt LP

    57.4     (53.9 )   3.5     (3.5 )    

  $ 114.4   $ (73.2 ) $ 41.2   $ (41.1 ) $ 0.1  
(20)
As of December 31, 2018, the Company had commitments to co-invest in the SDLP for its portion of the SDLP's commitment to fund delayed draw loans of up to $39. See Note 4 for more information on the SDLP.

(21)
Other than the investments noted by this footnote, the fair value of the Company's investments is determined using unobservable inputs that are significant to the overall fair value measurement. See Note 8 for more information regarding the fair value of the Company's investments.

(22)
As of December 31, 2018, the net estimated unrealized loss for federal tax purposes was $0.6 billion based on a tax cost basis of $13.0 billion. As of December 31, 2018, the estimated aggregate gross unrealized loss for federal income tax purposes was $0.9 billion and the estimated aggregate gross unrealized gain for federal income tax purposes was $0.3 billion.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY

As of March 31, 2019

(in millions, except per share data)

(unaudited)

 
  Common Stock    
  Accumulated
Undistributed
(Overdistributed)
Earnings
   
 
 
  Capital in
Excess of
Par Value
  Total
Stockholders'
Equity
 
 
  Shares   Amount  

Balance at December 31, 2017

    426   $   $ 7,192   $ (94 ) $ 7,098  

Net investment income

                144     144  

Net realized losses on investments, foreign currency and other transactions

                (12 )   (12 )

Net unrealized gains on investments, foreign currency and other transactions

                110     110  

Dividends declared and payable ($0.38 per share)

                (162 )   (162 )

Balance at March 31, 2018

    426   $   $ 7,192   $ (14 ) $ 7,178  

Net investment income

                162     162  

Net realized gains on investments, foreign currency and other transactions

                27     27  

Net unrealized gains on investments, foreign currency and other transactions

                65     65  

Dividends declared and payable ($0.38 per share)

                (162 )   (162 )

Balance at June 30, 2018

    426   $   $ 7,192   $ 78   $ 7,270  

Net investment income

                185     185  

Net realized gains on investments, foreign currency and other transactions

                373     373  

Net unrealized losses on investments, foreign currency and other transactions

                (349 )   (349 )

Dividends declared and payable ($0.39 per share)

                (166 )   (166 )

Balance at September 30, 2018

    426   $   $ 7,192   $ 121   $ 7,313  

Net investment income

                203     203  

Net realized gains on investments, foreign currency and other transactions

                31     31  

Net unrealized losses on investments, foreign currency and other transactions

                (81 )   (81 )

Dividends declared and payable ($0.39 per share)

                (166 )   (166 )

Tax reclassification of stockholders' equity in accordance with GAAP

            (19 )   19      

Balance at December 31, 2018

    426   $   $ 7,173   $ 127   $ 7,300  

Issuance of Convertible Unsecured Notes (See Note 5)

            4         4  

Net investment income

                201     201  

Net realized gains on investments, foreign currency and other transactions

                56     56  

Net unrealized losses on investments, foreign currency and other transactions

                (43 )   (43 )

Dividends declared and payable ($0.42 per share)

                (179 )   (179 )

Balance at March 31, 2019

    426   $   $ 7,177   $ 162   $ 7,339  

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(in millions)

(unaudited)

 
  For the Three
Months Ended
March 31,
 
 
  2019   2018  

OPERATING ACTIVITIES:

             

Net increase in stockholders' equity resulting from operations

  $ 214   $ 242  

Adjustments to reconcile net increase in stockholders' equity resulting from operations:

             

Net realized gains (losses) on investments and foreign currency and other transactions

    (56 )   12  

Net unrealized losses (gains) on investments, foreign currency and other transactions

    43     (110 )

Net accretion of discount on investments

    (3 )   (4 )

PIK interest and dividends

    (30 )   (24 )

Amortization of debt issuance costs

    4     4  

Net accretion of discount on notes payable

    2     1  

Proceeds from sales and repayments of investments and other transactions

    1,320     1,369  

Purchases of investments

    (1,925 )   (1,578 )

Changes in operating assets and liabilities:

             

Interest receivable

    (23 )   4  

Operating lease right-of-use asset

    (105 )    

Other assets

    9     12  

Base management fees payable

    4     2  

Income based fees payable

    2     1  

Capital gains incentive fees payable

    (48 )   20  

Interest and facility fees payable

    (39 )   (20 )

Operating lease liabilities

    137      

Accounts payable and other liabilities

    (21 )   (40 )

Net cash used in operating activities

    (515 )   (109 )

FINANCING ACTIVITIES:

             

Borrowings on debt

    3,636     2,168  

Repayments and repurchases of debt

    (2,649 )   (1,902 )

Debt issuance costs

    (17 )   (9 )

Dividends paid

    (179 )   (162 )

Net cash provided by financing activities

    791     95  

CHANGE IN CASH AND CASH EQUIVALENTS

    276     (14 )

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD

    296     316  

CASH AND CASH EQUIVALENTS, END OF PERIOD

  $ 572   $ 302  

Supplemental Information:

             

Interest paid during the period

  $ 95   $ 69  

Taxes, including excise tax, paid during the period

  $ 14   $ 14  

Dividends declared and payable during the period

  $ 179   $ 162  

   

See accompanying notes to consolidated financial statements.

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ARES CAPITAL CORPORATION AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
As of March 31, 2019
(unaudited)
(in millions, except per share data, percentages and as otherwise indicated;
for example, with the word "billion" or otherwise)

1.           ORGANIZATION

              Ares Capital Corporation (the "Company") is a specialty finance company that is a closed-end, non-diversified management investment company incorporated in Maryland. The Company has elected to be regulated as a business development company ("BDC") under the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the "Investment Company Act"). The Company has elected to be treated as a regulated investment company ("RIC") under the Internal Revenue Code of 1986, as amended (the "Code"), and operates in a manner so as to qualify for the tax treatment applicable to RICs.

              The Company's investment objective is to generate both current income and capital appreciation through debt and equity investments. The Company invests primarily in first lien senior secured loans (including "unitranche" loans, which are loans that combine both senior and mezzanine debt, generally in a first lien position), second lien senior secured loans and mezzanine debt, which in some cases includes an equity component. To a lesser extent, the Company also makes equity investments.

              The Company is externally managed by Ares Capital Management LLC ("Ares Capital Management" or the Company's "investment adviser"), a subsidiary of Ares Management Corporation ("Ares Management"), a publicly traded, leading global alternative asset manager, pursuant to an investment advisory and management agreement. Ares Operations LLC ("Ares Operations" or the Company's "administrator"), a subsidiary of Ares Management, provides certain administrative and other services necessary for the Company to operate.

2.           SIGNIFICANT ACCOUNTING POLICIES

      Basis of Presentation

              The accompanying consolidated financial statements have been prepared on the accrual basis of accounting in conformity with U.S. generally accepted accounting principles ("GAAP"), and include the accounts of the Company and its consolidated subsidiaries. The Company is an investment company following accounting and reporting guidance in Accounting Standards Codification ("ASC") Topic 946, Financial Services-Investments Companies . The consolidated financial statements reflect all adjustments and reclassifications that, in the opinion of management, are necessary for the fair presentation of the results of the operations and financial condition as of and for the periods presented. All significant intercompany balances and transactions have been eliminated.

              Interim financial statements are prepared in accordance with GAAP for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Articles 6 or 10 of Regulation S-X. In the opinion of management, all adjustments, consisting solely of normal recurring accruals considered necessary for the fair presentation of financial statements for the interim period presented, have been included. The current period's results of operations will not necessarily be indicative of results that ultimately may be achieved for the fiscal year ending December 31, 2019.

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      Cash and Cash Equivalents

              Cash and cash equivalents include funds from time to time deposited with financial institutions and short-term, liquid investments in a money market account. Cash and cash equivalents are carried at cost which approximates fair value. As of March 31, 2019 and December 31, 2018, there was $62 and $60, respectively, of cash denominated in foreign currencies included within "cash and cash equivalents" in the accompanying consolidated balance sheet.

      Concentration of Credit Risk

              The Company places its cash and cash equivalents with financial institutions and, at times, cash held in money market accounts may exceed the Federal Deposit Insurance Corporation insured limit.

      Investments

              Investment transactions are recorded on the trade date. Realized gains or losses are measured by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. Unrealized gains or losses primarily reflect the change in investment values, including the reversal of previously recorded unrealized gains or losses when gains or losses are realized.

              Investments for which market quotations are readily available are typically valued at such market quotations. In order to validate market quotations, the Company looks at a number of factors to determine if the quotations are representative of fair value, including the source and nature of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available (i.e., substantially all of the Company's investments) are valued at fair value as determined in good faith by the Company's board of directors, based on, among other things, the input of the Company's investment adviser, audit committee and independent third-party valuation firms that have been engaged at the direction of the Company's board of directors to assist in the valuation of each portfolio investment without a readily available market quotation at least once during a trailing 12-month period (with certain de minimis exceptions) and under a valuation policy and a consistently applied valuation process. The valuation process is conducted at the end of each fiscal quarter, and a portion of the Company's investment portfolio at fair value is subject to review by an independent valuation firm each quarter. In addition, the Company's independent registered public accounting firm obtains an understanding of, and performs select procedures relating to, the Company's investment valuation process within the context of performing the integrated audit.

              As part of the valuation process, the Company may take into account the following types of factors, if relevant, in determining the fair value of the Company's investments: the enterprise value of a portfolio company (the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time), the nature and realizable value of any collateral, the portfolio company's ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company's securities to any similar publicly traded securities, changes in the interest rate environment and the credit markets, which may affect the price at which similar investments would trade in their principal markets and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Company considers the pricing indicated by the external event to corroborate its valuation.

              Because there is not a readily available market value for most of the investments in its portfolio, the Company values substantially all of its portfolio investments at fair value as determined in good faith by its board of directors, as described herein. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair

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value of the Company's investments may fluctuate from period to period. Additionally, the fair value of the Company's investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that the Company may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If the Company was required to liquidate a portfolio investment in a forced or liquidation sale, the Company could realize significantly less than the value at which the Company has recorded it.

              In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected in the valuations currently assigned.

              The Company's board of directors undertakes a multi-step valuation process each quarter, as described below:

    The Company's quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals responsible for the portfolio investment in conjunction with the Company's portfolio management team.

    Preliminary valuations are reviewed and discussed with the Company's investment adviser's management and investment professionals, and then valuation recommendations are presented to the Company's board of directors.

    The audit committee of the Company's board of directors reviews these valuations, as well as the input of third parties, including independent third-party valuation firms who have reviewed a portion of the investments in the Company's portfolio at fair value.

    The Company's board of directors discusses valuations and ultimately determines the fair value of each investment in the Company's portfolio without a readily available market quotation in good faith based on, among other things, the input of the Company's investment adviser, audit committee and, where applicable, independent third-party valuation firms.

              See Note 8 for more information on the Company's valuation process.

      Interest and Dividend Income Recognition

              Interest income is recorded on an accrual basis and includes the accretion of discounts and amortization of premiums. Discounts from and premiums to par value on securities purchased are accreted/amortized into interest income over the life of the respective security using the effective yield method. The amortized cost of investments represents the original cost adjusted for the accretion of discounts and amortization of premiums, if any.

              Loans are generally placed on non-accrual status when principal or interest payments are past due 30 days or more or when there is reasonable doubt that principal or interest will be collected in full. Accrued and unpaid interest is generally reversed when a loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management's judgment regarding collectability. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management's judgment, are likely to remain current. The Company may make exceptions to this policy if the loan has sufficient collateral value and is in the process of collection.

              Dividend income on preferred equity securities is recorded as dividend income on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies.

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      Payment-in-Kind Interest

              The Company has loans in its portfolio that contain payment-in-kind ("PIK") provisions. The PIK interest, computed at the contractual rate specified in each loan agreement, is added to the principal balance of the loan and recorded as interest income. To maintain the Company's status as a RIC, this non-cash source of income must be paid out to stockholders in the form of dividends, even though the Company has not yet collected the cash.

      Capital Structuring Service Fees and Other Income

              In pursuit of the Company's investment objective, the Company's investment adviser seeks to provide assistance to its portfolio companies and in return the Company may receive fees for capital structuring services. These fees are fixed based on contractual terms, are generally only available to the Company as a result of the Company's underlying investments, are normally paid at the closing of the investments, are generally non-recurring and non-refundable and are recognized as revenue when earned upon closing of the investment. The services that the Company's investment adviser provides vary by investment, but generally include reviewing existing credit facilities, arranging bank financing, arranging equity financing, structuring financing from multiple lenders, structuring financing from multiple equity investors, restructuring existing loans, raising equity and debt capital, and providing general financial advice, which concludes upon closing of the investment. Any services of the above nature subsequent to the closing would generally generate a separate fee payable to the Company. In certain instances where the Company is invited to participate as a co-lender in a transaction and does not provide significant services in connection with the investment, a portion of loan fees paid to the Company in such situations will be deferred and amortized over the estimated life of the loan.

              Other income includes amendment fees that are fixed based on contractual terms and are generally non-recurring and non-refundable and are recognized as revenue when earned upon closing of the transaction. Other income also includes fees for management and consulting services, loan guarantees, commitments, and other services rendered by the Company to portfolio companies. Such fees are fixed based on contractual terms and are recognized as income as services are rendered.

      Foreign Currency Translation

              The Company's books and records are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:

    (1)
    Fair value of investment securities, other assets and liabilities—at the exchange rates prevailing at the end of the period.

    (2)
    Purchases and sales of investment securities, income and expenses—at the exchange rates prevailing on the respective dates of such transactions, income or expenses.

              Results of operations based on changes in foreign exchange rates are separately disclosed in the statement of operations, if any. Foreign security and currency translations may involve certain considerations and risks not typically associated with investing in U.S. companies and U.S. government securities. These risks include, but are not limited to, currency fluctuations and revaluations and future adverse political, social and economic developments, which could cause investments in foreign markets to be less liquid and prices more volatile than those of comparable U.S. companies or U.S. government securities.

      Derivative Instruments

              The Company does not utilize hedge accounting and as such values its derivatives at fair value with the unrealized gains or losses recorded in "net unrealized gains (losses) from foreign currency and other transactions" in the Company's consolidated statement of operations.

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      Equity Offering Expenses

              The Company's offering costs are charged against the proceeds from equity offerings when proceeds are received.

      Debt Issuance Costs

              Debt issuance costs are amortized over the life of the related debt instrument using the straight line method or the effective yield method, depending on the type of debt instrument.

      Leases

              The Company is obligated under a number of operating leases pursuant to which it is leasing office facilities from third parties with remaining terms ranging from less than one year to eight years. Such operating leases are included in operating lease right-of-use ("ROU") assets and operating lease liabilities in the accompanying consolidated balance sheets. The Company does not have any finance leases.

              The ROU asset represents the Company's right to use an underlying asset for the lease term and the operating lease liability represents the Company's obligation to make lease payments arising from such lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the remaining lease term. The Company's leases do not provide an implicit discount rate, and as such the Company uses its weighted average borrowing rate based on the information available at the commencement date in determining the present value of the remaining lease payments. Lease expense is recognized on a straight-line basis over the remaining lease term. The Company has elected the practical expedient to treat non-lease components as part of the lease as these components are not significant when compared to the lease component.

      Income Taxes

              The Company has elected to be treated as a RIC under the Code and operates in a manner so as to qualify for the tax treatment applicable to RICs. To qualify as a RIC, the Company must (among other requirements) meet certain source-of-income and asset diversification requirements and timely distribute to its stockholders at least 90% of its investment company taxable income, as defined by the Code, for each year. The Company has made and intends to continue to make the requisite distributions to its stockholders, which will generally relieve the Company from U.S. federal corporate-level income taxes.

              Depending on the level of taxable income earned in a tax year, the Company may choose to carry forward such taxable income in excess of current year dividend distributions from such current year taxable income into the next tax year and pay a 4% excise tax on such income, as required. To the extent that the Company determines that its estimated current year taxable income will be in excess of estimated dividend distributions for the current year from such income, the Company accrues excise tax, if any, on estimated excess taxable income as such taxable income is earned.

              Certain of the Company's consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

      Dividends to Common Stockholders

              Dividends and distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid out as a dividend is determined by the Company's board of directors each quarter and is generally based upon the earnings estimated by management. Net realized capital gains, if any, are generally distributed, although the Company may decide to retain such capital gains for investment.

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              The Company has adopted a dividend reinvestment plan that provides for reinvestment of any distributions the Company declares in cash on behalf of its stockholders, unless a stockholder elects to receive cash. As a result, if the Company's board of directors authorizes, and the Company declares, a cash dividend, then the Company's stockholders who have not "opted out" of the Company's dividend reinvestment plan will have their cash dividends automatically reinvested in additional shares of the Company's common stock, rather than receiving the cash dividend. The Company may use newly issued shares to implement the dividend reinvestment plan or, if the Company is otherwise permitted under applicable law to purchase such shares, the Company may purchase shares in the open market in connection with the Company's obligations under the dividend reinvestment plan.

      Use of Estimates in the Preparation of Financial Statements

              The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of actual and contingent assets and liabilities at the date of the financial statements and the reported amounts of income or loss and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include the valuation of investments.

      Recent Accounting Pronouncements

              Effective January 1, 2019, the Company adopted the Financial Accounting Standards Board ("FASB") Topic 842 ("ASC 842"), Leases . The Company adopted ASC 842 under the modified retrospective approach using the practical expedient provided for within ASC 842; therefore, the presentation of prior year periods has not been adjusted. No cumulative effect of initially adopting ASC 842 as an adjustment to the opening balance of components of equity as of January 1, 2019 was necessary as the recognition of the ROU assets equaled the corresponding lease liabilities.

3.           AGREEMENTS

      Investment Advisory and Management Agreement

              The Company is party to an investment advisory and management agreement (the "investment advisory and management agreement") with Ares Capital Management. Subject to the overall supervision of the Company's board of directors, Ares Capital Management provides investment advisory and management services to the Company. For providing these services, Ares Capital Management receives fees from the Company consisting of a base management fee, a fee based on the Company's net investment income ("income based fee") and a fee based on the Company's net capital gains ("capital gains incentive fee"). The investment advisory and management agreement may be terminated by either party without penalty upon 60 days' written notice to the other party.

              The base management fee is calculated at an annual rate of 1.5% based on the average value of the Company's total assets (other than cash or cash equivalents but including assets purchased with borrowed funds) at the end of the two most recently completed calendar quarters. The base management fee is payable quarterly in arrears. In connection with the Company's board of directors approving the modification of the asset coverage requirement applicable to senior securities from 200% to 150% effective on June 21, 2019 (unless the Company receives earlier stockholder approval), the investment advisory and management agreement will be amended effective June 21, 2019 (or such earlier date) to reduce the Company's annual base management fee from 1.5% to 1.0% on all assets financed using leverage over 1.0x debt to equity. See Note 5 for additional information.

              The income based fee is calculated and payable quarterly in arrears based on the Company's pre-incentive fee net investment income, as defined in the investment advisory and management agreement, for the quarter. Pre-incentive fee net investment income means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring,

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diligence and consulting fees or other fees that the Company receives from portfolio companies but excluding fees for providing managerial assistance) accrued during the calendar quarter, minus operating expenses for the quarter (including the base management fee, any expenses payable under the administration agreement, and any interest expense and dividends paid on any outstanding preferred stock, but excluding the income based fee and capital gains incentive fee accrued under GAAP). Pre-incentive fee net investment income includes, in the case of investments with a deferred interest feature such as market discount, debt instruments with PIK interest, preferred stock with PIK dividends and zero coupon securities, accrued income that the Company has not yet received in cash. The Company's investment adviser is not under any obligation to reimburse the Company for any part of the income based fees it received that was based on accrued interest that the Company never actually received.

              Pre-incentive fee net investment income does not include any realized capital gains, realized capital losses, unrealized capital appreciation, unrealized capital depreciation or income tax expense related to realized gains and losses. Because of the structure of the income based fee, it is possible that the Company may pay such fees in a quarter where the Company incurs a loss. For example, if the Company receives pre-incentive fee net investment income in excess of the hurdle rate (as defined below) for a quarter, the Company will pay the applicable income based fee even if the Company has incurred a loss in that quarter due to realized and/or unrealized capital losses.

              Pre-incentive fee net investment income, expressed as a rate of return on the value of the Company's net assets (defined as total assets less indebtedness and before taking into account any income based fees and capital gains incentive fees payable during the period) at the end of the immediately preceding calendar quarter, is compared to a fixed "hurdle rate" of 1.75% per quarter. If market credit spreads rise, the Company may be able to invest its funds in debt instruments that provide for a higher return, which may increase the Company's pre-incentive fee net investment income and make it easier for the Company's investment adviser to surpass the fixed hurdle rate and receive an income based fee based on such net investment income. To the extent the Company has retained pre-incentive fee net investment income that has been used to calculate the income based fee, it is also included in the amount of the Company's total assets (other than cash and cash equivalents but including assets purchased with borrowed funds) used to calculate the 1.5% base management fee.

              The Company pays its investment adviser an income based fee with respect to the Company's pre-incentive fee net investment income in each calendar quarter as follows:

    No income based fee in any calendar quarter in which the Company's pre-incentive fee net investment income does not exceed the hurdle rate;

    100% of the Company's pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the hurdle rate but is less than 2.1875% in any calendar quarter. The Company refers to this portion of its pre-incentive fee net investment income (which exceeds the hurdle rate but is less than 2.1875%) as the "catch-up" provision. The "catch-up" is meant to provide the Company's investment adviser with 20% of the pre-incentive fee net investment income as if a hurdle rate did not apply if this net investment income exceeded 2.1875% in any calendar quarter; and

    20% of the amount of the Company's pre-incentive fee net investment income, if any, that exceeds 2.1875% in any calendar quarter.

              These calculations are adjusted for any share issuances or repurchases during the quarter.

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              In connection with the Company's acquisition of American Capital, Ltd., a Delaware corporation ("American Capital") (the "American Capital Acquisition"), Ares Capital Management agreed to waive, for each of the first ten calendar quarters beginning with the second quarter of 2017 and ending with the third quarter of 2019, the lesser of (x) $10 of income based fees and (y) the amount of income based fees for such quarter, in each case, to the extent payable by the Company in such quarter pursuant to and as calculated under the Company's investment advisory and management agreement (the "Fee Waiver").

              The capital gains incentive fee is determined and payable in arrears as of the end of each calendar year (or, upon termination of the investment advisory and management agreement, as of the termination date) and is calculated at the end of each applicable year by subtracting (a) the sum of the Company's cumulative aggregate realized capital losses and aggregate unrealized capital depreciation from (b) the Company's cumulative aggregate realized capital gains, in each case calculated from October 8, 2004 (the date the Company completed its initial public offering). Realized capital gains and losses include gains and losses on investments and foreign currencies, gains and losses on extinguishment of debt and from other assets, as well as any income tax and other expenses related to cumulative aggregate realized gains and losses. If such amount is positive at the end of such year, then the capital gains incentive fee for such year is equal to 20% of such amount, less the aggregate amount of capital gains incentive fees paid in all prior years. If such amount is negative, then there is no capital gains incentive fee for such year.

              The cumulative aggregate realized capital gains are calculated as the sum of the differences, if positive, between (a) the net sales price of each investment in the Company's portfolio when sold and (b) the accreted or amortized cost basis of such investment.

              The cumulative aggregate realized capital losses are calculated as the sum of the amounts by which (a) the net sales price of each investment in the Company's portfolio when sold is less than (b) the accreted or amortized cost basis of such investment.

              The aggregate unrealized capital depreciation is calculated as the sum of the differences, if negative, between (a) the valuation of each investment in the Company's portfolio as of the applicable capital gains incentive fee calculation date and (b) the accreted or amortized cost basis of such investment.

              Notwithstanding the foregoing, as a result of an amendment to the capital gains incentive fee under the investment advisory and management agreement that was adopted on June 6, 2011, if the Company is required by GAAP to record an investment at its fair value as of the time of acquisition instead of at the actual amount paid for such investment by the Company (including, for example, as a result of the application of the asset acquisition method of accounting), then solely for the purposes of calculating the capital gains incentive fee, the "accreted or amortized cost basis" of an investment shall be an amount (the "Contractual Cost Basis") equal to (1) (x) the actual amount paid by the Company for such investment plus (y) any amounts recorded in the Company's financial statements as required by GAAP that are attributable to the accretion of such investment plus (z) any other adjustments made to the cost basis included in the Company's financial statements, including PIK interest or additional amounts funded (net of repayments) minus (2) any amounts recorded in the Company's financial statements as required by GAAP that are attributable to the amortization of such investment, whether such calculated Contractual Cost Basis is higher or lower than the fair value of such investment (as determined in accordance with GAAP) at the time of acquisition.

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              The base management fees, income based fees and capital gains incentive fees for the three months ended March 31, 2019 and 2018 were as follows:

 
  For the Three
Months Ended
March 31,
 
 
  2019   2018  

Base management fees

  $ 49   $ 46  

Income based fees

  $ 48   $ 38  

Waiver of income based fees

    (10 )   (10 )

Income based fees, net of the Fee Waiver

  $ 38   $ 28  

Capital gains incentive fees(1)

  $ 2   $ 20  

(1)
Calculated in accordance with GAAP as discussed below.

              There was no capital gains incentive fee earned by the Company's investment adviser as calculated under the investment advisory and management agreement for the three months ended March 31, 2019 and 2018, respectively. In addition, in accordance with GAAP, the Company had cumulatively accrued a capital gains incentive fee of $64 as of March 31, 2019, of which $64 is not currently due under the investment advisory and management agreement. GAAP requires that the capital gains incentive fee accrual consider the cumulative aggregate unrealized capital appreciation in the calculation, as a capital gains incentive fee would be payable if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the investment advisory and management agreement. This GAAP accrual is calculated using the aggregate cumulative realized capital gains and losses and aggregate cumulative unrealized capital depreciation included in the calculation of the capital gains incentive fee plus the aggregate cumulative unrealized capital appreciation, net of any expense associated with cumulative unrealized capital depreciation or appreciation. If such amount is positive at the end of a period, then GAAP requires the Company to record a capital gains incentive fee equal to 20% of such cumulative amount, less the aggregate amount of actual capital gains incentive fees paid or capital gains incentive fees accrued under GAAP in all prior periods. As of March 31, 2019, the Company has paid capital gains incentive fees since inception totaling $108. The resulting accrual for any capital gains incentive fee under GAAP in a given period may result in an additional expense if such cumulative amount is greater than in the prior period or a reversal of previously recorded expense if such cumulative amount is less than in the prior period. If such cumulative amount is negative, then there is no accrual. There can be no assurance that such unrealized capital appreciation will be realized in the future.

              The Company defers cash payment of any income based fees and capital gains incentive fees otherwise earned by the Company's investment adviser if during the most recent four full calendar quarter period ending on or prior to the date such payment is to be made the sum of (a) the aggregate distributions to the Company's stockholders and (b) the change in net assets (defined as total assets less indebtedness and before taking into account any income based fees and capital gains incentive fees payable during the period) is less than 7.0% of the Company's net assets (defined as total assets less indebtedness) at the beginning of such period. Any deferred income based fees and capital gains incentive fees are carried over for payment in subsequent calculation periods to the extent such payment is payable under the investment advisory and management agreement.

              The services of all investment professionals and staff of the Company's investment adviser, when and to the extent engaged in providing investment advisory and management services to the Company, and routine overhead expenses of such personnel allocable to such services, are provided and paid for by the Company's investment adviser. Under the investment advisory and management agreement, the Company bears all other costs and expenses of its operations and transactions,

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including, but not limited to, those relating to: organization; calculation of the Company's net asset value (including, but not limited to, the cost and expenses of any independent valuation firm); expenses incurred by the Company's investment adviser payable to third parties, including agents, consultants or other advisers, in monitoring the Company's financial and legal affairs and in monitoring the Company's investments (including the cost of consultants hired to develop information technology systems designed to monitor the Company's investments) and performing due diligence on the Company's prospective portfolio companies; interest payable on indebtedness, if any, incurred to finance the Company's investments (including payments to third party vendors for financial information services); offerings of the Company's common stock and other securities; investment advisory and management fees; administration fees; fees payable to third parties, including agents, consultants or other advisers, relating to, or associated with, evaluating and making investments in portfolio companies, regardless of whether such transactions are ultimately consummated; transfer agent and custodial fees; registration fees; listing fees; taxes; independent directors' fees and expenses; costs of preparing and filing reports or other documents with the Securities and Exchange Commission (the "SEC"); the costs of any reports, proxy statements or other notices to stockholders, including printing costs; to the extent the Company is covered by any joint insurance policies, the Company's allocable portion of the insurance premiums for such policies; direct costs and expenses of administration, including auditor and legal costs; and all other expenses incurred by the Company or its administrator in connection with administering the Company's business as described in more detail under "Administration Agreement" below.

      Administration Agreement

              The Company is party to an administration agreement, referred to herein as the "administration agreement", with its administrator, Ares Operations. Pursuant to the administration agreement, Ares Operations furnishes the Company with office equipment and clerical, bookkeeping and record keeping services at the Company's office facilities. Under the administration agreement, Ares Operations also performs, or oversees the performance of, the Company's required administrative services, which include, among other things, providing assistance in accounting, legal, compliance, operations, technology and investor relations, being responsible for the financial records that the Company is required to maintain and preparing reports to its stockholders and reports filed with the SEC. In addition, Ares Operations assists the Company in determining and publishing its net asset value, assists the Company in providing managerial assistance to its portfolio companies, oversees the preparation and filing of the Company's tax returns and the printing and dissemination of reports to its stockholders, and generally oversees the payment of its expenses and the performance of administrative and professional services rendered to the Company by others. Payments under the administration agreement are equal to an amount based upon its allocable portion of Ares Operations' overhead and other expenses (including travel expenses) incurred by Ares Operations in performing its obligations under the administration agreement, including the Company's allocable portion of the compensation, rent and other expenses of certain of its officers (including the Company's chief compliance officer, chief financial officer, chief accounting officer, general counsel, secretary, treasurer and assistant treasurer) and their respective staffs. The administration agreement may be terminated by either party without penalty upon 60 days' written notice to the other party.

              For the three months ended March 31, 2019 and 2018, the Company incurred $4 and $3, respectively, in administrative fees. As of March 31, 2019 and December 31, 2018, a total of $4 and $3, respectively, in administrative fees were unpaid and included in "accounts payable and other liabilities" in the accompanying consolidated balance sheet.

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4.           INVESTMENTS

              As of March 31, 2019 and December 31, 2018, investments consisted of the following:

 
  As of  
 
  March 31, 2019   December 31, 2018  
 
  Amortized Cost(1)   Fair Value   Amortized Cost(1)   Fair Value  

First lien senior secured loans

  $ 5,953   $ 5,785   $ 5,976   $ 5,836  

Second lien senior secured loans

    4,220     3,976     3,878     3,657  

Subordinated certificates of the SDLP(2)

    792     792     652     652  

Senior subordinated loans

    726     742     717     727  

Collateralized loan obligations

    43     43     44     45  

Preferred equity securities

    734     601     576     444  

Other equity securities

    972     1,125     911     1,056  

Total

  $ 13,440   $ 13,064   $ 12,754   $ 12,417  

(1)
The amortized cost represents the original cost adjusted for the accretion of discounts and amortization of premiums, if any.

(2)
The proceeds from these certificates were applied to co-investments with Varagon and its clients to fund first lien senior secured loans to 22 and 21 different borrowers as of March 31, 2019 and December 31, 2018, respectively.

              The industrial and geographic compositions of the Company's portfolio at fair value as of March 31, 2019 and December 31, 2018 were as follows:

 
  As of  
 
  March 31,
2019
  December 31,
2018
 

Industry

             

Healthcare Services

    22.2 %   21.7 %

Business Services

    17.2     17.9  

Consumer Products

    7.7     8.3  

Investment Funds and Vehicles(1)

    6.9     6.2  

Financial Services

    6.4     6.6  

Other Services

    5.3     5.7  

Manufacturing

    5.3     6.1  

Power Generation

    5.0     4.8  

Automotive Services

    3.9     2.8  

Restaurants and Food Services

    3.6     3.8  

Food and Beverage

    3.5     2.9  

Oil and Gas

    2.9     3.0  

Wholesale Distribution

    2.3     2.3  

Containers and Packaging

    1.9     1.5  

Education

    1.9     2.2  

Other

    4.0     4.2  

Total

    100.0 %   100.0 %

(1)
Includes the Company's investment in the SDLP, which made first lien senior secured loans to 22 and 21 different borrowers as of March 31, 2019 and December 31, 2018,

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    respectively. The portfolio companies in the SDLP are in industries similar to the companies in the Company's portfolio.

 
  As of  
 
  March 31,
2019
  December 31,
2018
 

Geographic Region

             

Midwest

    27.1 %   31.4 %

West(1)

    24.3     24.0  

Southeast

    20.8     18.8  

Mid Atlantic

    17.5     18.2  

Northeast

    7.8     5.4  

International

    2.5     2.2  

Total

    100.0 %   100.0 %

(1)
Includes the Company's investment in the SDLP, which represented 6.1% and 5.3% of the total investment portfolio at fair value as of March 31, 2019 and December 31, 2018, respectively.

              As of March 31, 2019, 2.3% of total investments at amortized cost (or 0.4% of total investments at fair value) were on non-accrual status. As of December 31, 2018, 2.5% of total investments at amortized cost (or 0.6% of total investments at fair value) were on non-accrual status.

      Senior Direct Lending Program

              The Company has established a joint venture with Varagon to make certain first lien senior secured loans, including certain stretch senior and unitranche loans, primarily to U.S. middle market companies. Varagon was formed in 2013 as a lending platform by American International Group, Inc. and other partners. The joint venture is called the SDLP. In July 2016, the Company and Varagon and its clients completed the initial funding of the SDLP. The SDLP may generally commit and hold individual loans of up to $300. The Company and other accounts managed by the Company's investment adviser and its affiliates may directly co-invest with the SDLP to accommodate larger transactions. The SDLP is capitalized as transactions are completed and all portfolio decisions and generally all other decisions in respect of the SDLP must be approved by an investment committee of the SDLP consisting of representatives of the Company and Varagon (with approval from a representative of each required).

              The Company provides capital to the SDLP in the form of subordinated certificates (the "SDLP Certificates"), and Varagon and its clients provide capital to the SDLP in the form of senior notes, intermediate funding notes and SDLP Certificates. As of March 31, 2019 and December 31, 2018, the Company and a client of Varagon owned 87.5% and 12.5%, respectively, of the outstanding SDLP Certificates.

              As of March 31, 2019 and December 31, 2018, the Company and Varagon and its clients had agreed to make capital available to the SDLP of $6,150 and $6,400, respectively, in the aggregate, of which $1,444 and $1,444, respectively, is to be made available from the Company. The Company will continue to provide capital to the SDLP in the form of SDLP Certificates, and Varagon and its clients will provide capital to the SDLP in the form of senior notes, intermediate funding notes and SDLP Certificates. This capital will only be committed to the SDLP upon approval of transactions by the

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investment committee of the SDLP as discussed above. Below is a summary of the funded capital and unfunded capital commitments of the SDLP.

 
  As of  
 
  March 31,
2019
  December 31,
2018
 

Total capital funded to the SDLP(1)

  $ 3,331   $ 3,104  

Total capital funded to the SDLP by the Company(1)

  $ 792   $ 652  

Total unfunded capital commitments to the SDLP(2)

  $ 243   $ 187  

Total unfunded capital commitments to the SDLP by the Company(2)

  $ 58   $ 39  

(1)
At principal amount.

(2)
These commitments have been approved by the investment committee of the SDLP and will be funded as the transactions are completed.

              The SDLP Certificates pay a coupon of LIBOR plus 8.0% and also entitle the holders thereof to receive a portion of the excess cash flow from the loan portfolio, after expenses, which may result in a return to the holders of the SDLP Certificates that is greater than the stated coupon. The SDLP Certificates are junior in right of payment to the senior notes and intermediate funding notes.

              The amortized cost and fair value of the SDLP Certificates held by the Company were $792 and $792, respectively, as of March 31, 2019. The Company's yield on its investment in the SDLP at amortized cost and fair value was 14.8% and 14.8%, respectively, as of March 31, 2019. The amortized cost and fair value of the SDLP Certificates held by the Company were $652 and $652, respectively, as of December 31, 2018. The Company's yield on its investment in the SDLP at amortized cost and fair value was 15.0% and 15.0%, respectively, as of December 31, 2018. For the three months ended March 31, 2019 and 2018, the Company earned interest income of $27 and $18, respectively, from its investment in the SDLP Certificates. The Company is also entitled to certain fees in connection with the SDLP. For the three months ended March 31, 2019 and 2018, in connection with the SDLP, the Company earned capital structuring service and other fees totaling $4 and $2, respectively.

              As of March 31, 2019 and December 31, 2018, the SDLP's portfolio was comprised entirely of first lien senior secured loans to U.S. middle-market companies and were in industries similar to the companies in the Company's portfolio. As of March 31, 2019 and December 31, 2018, none of the loans were on non-accrual status. Below is a summary of the SDLP's portfolio.

 
  As of  
 
  March 31,
2019
  December 31,
2018
 

Total first lien senior secured loans(1)

  $ 3,322   $ 3,086  

Largest loan to a single borrower(1)

  $ 249   $ 249  

Total of five largest loans to borrowers(1)

  $ 1,178   $ 1,132  

Number of borrowers in the SDLP

    22     21  

Commitments to fund delayed draw loans(2)

  $ 243   $ 187  

(1)
At principal amount.

(2)
As discussed above, these commitments have been approved by the investment committee of the SDLP.

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      Ivy Hill Asset Management, L.P.

              Ivy Hill Asset Management, L.P. ("IHAM") is an asset management services company and an SEC-registered investment adviser. The Company has made investments in IHAM, its wholly owned portfolio company, and previously made investments in certain vehicles managed by IHAM. As of March 31, 2019, IHAM had assets under management of approximately $4.6 billion. As of March 31, 2019, IHAM managed 21 vehicles and served as the sub-manager/sub-servicer for two other vehicles (these vehicles managed or sub-managed/sub-serviced by IHAM are collectively referred to as the "IHAM Vehicles"). IHAM earns fee income from managing the IHAM Vehicles and has also invested in certain of these vehicles as part of its business strategy. As of March 31, 2019 and December 31, 2018, IHAM had total investments of $427 and $448, respectively. For the three months ended March 31, 2019 and 2018, IHAM had management and incentive fee income of $6 and $6, respectively, and other investment-related income of $13 and $15, respectively.

              The amortized cost and fair value of the Company's investment in IHAM was $444 and $534, respectively, as of March 31, 2019, and $444 and $518, respectively, as of December 31, 2018. For the three months ended March 31, 2019 and 2018, the Company received distributions consisting entirely of dividend income from IHAM of $15 and $13, respectively. Additionally, in February 2018, the Company provided a $63 subordinated revolving loan and a $200 equity capital contribution to IHAM to help support IHAM's acquisition of a portfolio of middle market loans.

              From time to time, IHAM or certain IHAM Vehicles may purchase investments from, or sell investments to, the Company. For any such sales or purchases by the IHAM Vehicles to or from the Company, the IHAM Vehicles must obtain approval from third parties unaffiliated with the Company or IHAM, as applicable. During the three months ended March 31, 2019, IHAM or certain of the IHAM Vehicles purchased $302 of investments from the Company. For the three months ended March 31, 2019, the Company recorded $1 of net realized losses from these sales. During the three months ended March 31, 2018, neither IHAM nor any of the IHAM Vehicles purchased any investments from the Company.

              IHAM is party to an administration agreement, referred to herein as the "IHAM administration agreement," with Ares Operations. Pursuant to the IHAM administration agreement, Ares Operations provides IHAM with, among other things, office facilities, equipment, clerical, bookkeeping and record keeping services, services relating to the marketing and sale of interests in vehicles managed by IHAM, services of, and oversight of, custodians, depositories, accountants, attorneys, underwriters and such other persons in any other capacity deemed to be necessary. Under the IHAM administration agreement, IHAM reimburses Ares Operations for all of the actual costs associated with such services, including Ares Operations' allocable portion of the compensation, rent and other expenses of its officers, employees and respective staff in performing its obligations under the IHAM administration agreement.

5.           DEBT

              In accordance with the Investment Company Act, the Company is currently allowed to borrow amounts such that its asset coverage, calculated pursuant to the Investment Company Act, is at least 200% after such borrowing. On June 21, 2018, the Company's board of directors, including a "required majority" (as such term is defined in Section 57(o) of the Investment Company Act) of the Company's board of directors, approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the Investment Company Act, as amended by the Small Business Credit Availability Act. As a result, effective on June 21, 2019 (unless the Company receives earlier stockholder approval), the Company's asset coverage requirement applicable to senior securities will be reduced from 200% to 150%. As of March 31, 2019, the aggregate amount outstanding of the senior securities issued by the Company was $6.3 billion. As of March 31, 2019, the Company's asset coverage was 215%.

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              The Company's outstanding debt as of March 31, 2019 and December 31, 2018 was as follows:

 
  As of  
 
  March 31, 2019   December 31, 2018  
 
  Total
Aggregate
Principal
Amount
Committed/
Outstanding(1)
  Principal
Amount
Outstanding
  Carrying
Value
  Total
Aggregate
Principal
Amount
Committed/
Outstanding(1)
  Principal
Amount
Outstanding
  Carrying
Value
 

Revolving Credit Facility

  $ 2,133 (2) $ 1,997   $ 1,997   $ 2,133 (2) $ 1,064   $ 1,064  

Revolving Funding Facility

    1,000     620     620     1,000     520     520  

SMBC Funding Facility

    400     105     105     400     245     245  

2019 Convertible Notes

                300     300     300 (3)

2022 Convertible Notes

    388     388     374 (3)   388     388     372 (3)

2024 Convertible Notes

    403     403     386 (3)            

2020 Notes

    600     600     599 (4)   600     600     598 (4)

2022 Notes

    600     600     595 (5)   600     600     595 (5)

2023 Notes

    750     750     745 (6)   750     750     744 (6)

2025 Notes

    600     600     593 (7)   600     600     593 (7)

2047 Notes

    230     230     183 (8)   230     230     183 (8)

Total

  $ 7,104   $ 6,293   $ 6,197   $ 7,001   $ 5,297   $ 5,214  

(1)
Subject to borrowing base, leverage and other restrictions. Represents the total aggregate amount committed or outstanding, as applicable, under such instrument.

(2)
Provides for a feature that allows the Company, under certain circumstances, to increase the size of the Revolving Credit Facility (as defined below) to a maximum of $3,133.

(3)
Represents the aggregate principal amount outstanding of the Convertible Unsecured Notes (as defined below). As of March 31, 2019, the total unamortized debt issuance costs and the unaccreted discount for the 2022 Convertible Notes and the 2024 Convertible Notes (each as defined below) were $14 and $17, respectively. As of December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount for the 2019 Convertible Notes and the 2022 Convertible Notes (each as defined below) were $0 and $16, respectively.

(4)
Represents the aggregate principal amount outstanding of the 2020 Notes (as defined below) less unamortized debt issuance costs and the net unaccreted discount recorded upon the issuances of the 2020 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the net unaccreted discount was $1 and $2, respectively.

(5)
Represents the aggregate principal amount outstanding of the 2022 Notes (as defined below), less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2022 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount was $5 and $5, respectively.

(6)
Represents the aggregate principal amount outstanding of the 2023 Notes (as defined below), less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2023 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount was $5 and $6, respectively.

(7)
Represents the aggregate principal amount outstanding of the 2025 Notes (as defined below), less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2025 Notes. As of March 31, 2019 and December 31, 2018, the total unamortized debt issuance costs and the unaccreted discount was $7 and $7, respectively.

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(8)
Represents the aggregate principal amount outstanding of the 2047 Notes (as defined below), less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2047 Notes. As of March 31, 2019 and December 31, 2018, the total unaccreted purchased discount was $47 and $47, respectively.

              The weighted average stated interest rate and weighted average maturity, both on aggregate principal amount outstanding, of all the Company's outstanding debt as of March 31, 2019 were 4.1% and 4.7 years, respectively, and as of December 31, 2018 were 4.1% and 4.8 years, respectively.

      Revolving Credit Facility

              The Company is party to a senior secured revolving credit facility (as amended and restated, the "Revolving Credit Facility"), which as of March 31, 2019 allowed the Company to borrow up to $2,133 at any one time outstanding. As of March 31, 2019, the Revolving Credit Facility consisted of a $414 term loan tranche with a stated maturity date of March 30, 2023 and a $1,719 revolving tranche. For $1,624 of the revolving tranche, the end of the revolving period and the stated maturity date were March 30, 2022 and March 30, 2023, respectively. For $50 of the revolving tranche, the end of the revolving period and the stated maturity date were January 4, 2021 and January 4, 2022, respectively. For the remaining $45 of the revolving tranche, the end of the revolving period and the stated maturity date were May 4, 2019 and May 4, 2020, respectively. The Revolving Credit Facility also provides for a feature that allowed the Company, under certain circumstances, to increase the overall size of the Revolving Credit Facility to a maximum of $3,133 as of March 31, 2019. The Revolving Credit Facility generally requires payments of interest at the end of each LIBOR interest period, but no less frequently than quarterly, on LIBOR based loans, and monthly payments of interest on other loans. From the end of the revolving period to the stated maturity date as applicable for each revolving tranche, the Company is required to repay outstanding principal amounts under such revolving tranche on a monthly basis in an amount equal to 1/12th of the outstanding principal amount at the end of the revolving period.

              Under the Revolving Credit Facility, the Company is required to comply with various covenants, reporting requirements and other customary requirements for similar revolving credit facilities, including, without limitation, covenants related to: (a) limitations on the incurrence of additional indebtedness and liens, (b) limitations on certain investments, (c) limitations on certain restricted payments, (d) maintaining a certain minimum stockholders' equity, (e) maintaining a ratio of total assets (less total liabilities other than indebtedness) to total indebtedness of the Company and its consolidated subsidiaries (subject to certain exceptions) of not less than 1.5:1.0, (f) limitations on pledging certain unencumbered assets, and (g) limitations on the creation or existence of agreements that prohibit liens on certain properties of the Company and certain of its subsidiaries. These covenants are subject to important limitations and exceptions that are described in the documents governing the Revolving Credit Facility. Amounts available to borrow under the Revolving Credit Facility (and the incurrence of certain other permitted debt) are also subject to compliance with a borrowing base that applies different advance rates to different types of assets in the Company's portfolio that are pledged as collateral. As of March 31, 2019, the Company was in compliance in all material respects with the terms of the Revolving Credit Facility. See Note 15 for a subsequent event regarding the Revolving Credit Facility.

              As of March 31, 2019 and December 31, 2018, there was $1,997 and $1,064 outstanding, respectively, under the Revolving Credit Facility. As of March 31, 2019, the Revolving Credit Facility also provides for a sub-limit for the issuance of letters of credit for up to an aggregate amount of $150. As of March 31, 2019 and December 31, 2018, the Company had $59 and $57, respectively, in letters of credit issued through the Revolving Credit Facility. The amount available for borrowing under the Revolving Credit Facility is reduced by any letters of credit issued. As of March 31, 2019, there was $77 available for borrowing (net of letters of credit issued) under the Revolving Credit Facility.

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              Since March 30, 2018, the interest rate charged on the Revolving Credit Facility is based on an applicable spread of either 1.75% or 1.875% over LIBOR or 0.75% or 0.875% over an "alternate base rate" (as defined in the agreements governing the Revolving Credit Facility), in each case, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. Prior to March 30, 2018, the interest rate charged on the Revolving Credit Facility was based on an applicable spread of either 1.75% or 2.00% over LIBOR or 0.75% or 1.00% over an "alternate base rate" (as defined in the agreements governing the Revolving Credit Facility), in each case, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility. As of March 31, 2019, the interest rate in effect was LIBOR plus 1.75%. As of March 31, 2019, the one, two, three and six month LIBOR was 2.49%, 2.56%, 2.60% and 2.66%, respectively. As of December 31, 2018, the one, two, three and six month LIBOR was 2.50%, 2.61%, 2.81% and 2.88%, respectively. In addition to the stated interest expense on the Revolving Credit Facility, the Company is required to pay a commitment fee of 0.375% per annum on any unused portion of the Revolving Credit Facility. The Company is also required to pay a letter of credit fee of either 2.00% or 2.125% per annum on letters of credit issued, determined monthly based on the total amount of the borrowing base relative to the total commitments of the Revolving Credit Facility and other debt, if any, secured by the same collateral as the Revolving Credit Facility.

              In December 2017, the Company entered into an interest rate swap agreement to effectively fix the interest rate in connection with $395 of the term loan tranche of the Revolving Credit Facility. See Note 6 for more information on the interest rate swap.

              The Revolving Credit Facility is secured by certain assets in the Company's portfolio and excludes investments held by Ares Capital CP under the Revolving Funding Facility and those held by ACJB under the SMBC Funding Facility (as defined below), each as described below, and certain other investments.

              For the three months ended March 31, 2019 and 2018, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the Revolving Credit Facility were as follows:

 
  For the Three
Months Ended
March 31,
 
 
  2019   2018  

Stated interest expense

  $ 18   $ 3  

Facility fees

        2  

Amortization of debt issuance costs

    1     1  

Total interest and credit facility fees expense

  $ 19   $ 6  

Cash paid for interest expense

  $ 20   $ 4  

Average stated interest rate

    4.20 %   3.34 %

Average outstanding balance

  $ 1,662   $ 395  

      Revolving Funding Facility

              The Company's consolidated subsidiary, Ares Capital CP Funding LLC ("Ares Capital CP"), is party to a revolving funding facility (as amended, the "Revolving Funding Facility"), which allows Ares Capital CP to borrow up to $1,000 at any one time outstanding. The Revolving Funding Facility is secured by all of the assets held by, and the membership interest in, Ares Capital CP. The end of the reinvestment period and the stated maturity date for the Revolving Funding Facility are January 3, 2022 and January 3, 2024, respectively.

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              Amounts available to borrow under the Revolving Funding Facility are subject to a borrowing base that applies different advance rates to different types of assets held by Ares Capital CP. Ares Capital CP is also subject to limitations with respect to the loans securing the Revolving Funding Facility, including restrictions on sector concentrations, loan size, payment frequency and status, collateral interests, loans with fixed rates and loans with certain investment ratings, as well as restrictions on portfolio company leverage, which may also affect the borrowing base and therefore amounts available to borrow. The Company and Ares Capital CP are also required to comply with various covenants, reporting requirements and other customary requirements for similar facilities. These covenants are subject to important limitations and exceptions that are described in the agreements governing the Revolving Funding Facility. As of March 31, 2019, the Company and Ares Capital CP were in compliance in all material respects with the terms of the Revolving Funding Facility.

              As of March 31, 2019 and December 31, 2018, there was $620 and $520 outstanding, respectively, under the Revolving Funding Facility. Since December 14, 2018, the interest rate charged on the Revolving Funding Facility was based on LIBOR plus 2.00% per annum or a "base rate" (as defined in the agreements governing the Revolving Funding Facility) plus 1.00% per annum. Prior to and including December 13, 2018, the interest rate charged on the Revolving Funding Facility was based on LIBOR plus 2.15% per annum or a "base rate" plus 1.15% per annum. Ares Capital CP is also required to pay a commitment fee between 0.50% and 1.50% per annum depending on the size of the unused portion of the Revolving Funding Facility.

              For the three months ended March 31, 2019 and 2018, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the Revolving Funding Facility were as follows:

 
  For the Three
Months Ended
March 31,
 
 
  2019   2018  

Stated interest expense

  $ 6   $ 3  

Facility fees

    1     2  

Amortization of debt issuance costs

    1     1  

Total interest and credit facility fees expense

  $ 8   $ 6  

Cash paid for interest expense

  $ 7   $ 5  

Average stated interest rate

    4.50 %   3.83 %

Average outstanding balance

  $ 530   $ 291  

      SMBC Funding Facility

              The Company's consolidated subsidiary, Ares Capital JB Funding LLC ("ACJB"), is party to a revolving funding facility (as amended, the "SMBC Funding Facility") with ACJB, as the borrower, and Sumitomo Mitsui Banking Corporation ("SMBC"), as the administrative agent, collateral agent and lender, that allows ACJB to borrow up to $400 at any one time outstanding. The SMBC Funding Facility is secured by all of the assets held by ACJB. The end of the reinvestment period and the stated maturity date for the SMBC Funding Facility are September 14, 2019 and September 14, 2024, respectively. The reinvestment period and the stated maturity date are both subject to two one-year extensions by mutual agreement.

              Amounts available to borrow under the SMBC Funding Facility are subject to a borrowing base that applies an advance rate to assets held by ACJB. The Company and ACJB are also required to comply with various covenants, reporting requirements and other customary requirements for similar facilities. These covenants are subject to important limitations and exceptions that are described in the

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documents governing the SMBC Funding Facility. As of March 31, 2019, the Company and ACJB were in compliance in all material respects with the terms of the SMBC Funding Facility.

              As of March 31, 2019 and December 31, 2018, there was $105 and $245 outstanding, respectively, under the SMBC Funding Facility. The interest rate charged on the SMBC Funding Facility is based on an applicable spread of either 1.75% or 2.00% over LIBOR or 0.75% or 1.00% over a "base rate" (as defined in the agreements governing the SMBC Funding Facility), in each case, determined monthly based on the amount of the average borrowings outstanding under the SMBC Funding Facility. As of March 31, 2019, the interest rate in effect was LIBOR plus 1.75%. ACJB is required to pay a commitment fee of between 0.35% and 0.875% per annum depending on the size of the unused portion of the SMBC Funding Facility.

              For the three months ended March 31, 2019 and 2018, the components of interest and credit facility fees expense, cash paid for interest expense, average stated interest rates (i.e., rate in effect plus the spread) and average outstanding balances for the SMBC Funding Facility were as follows:

 
  For the Three
Months Ended
March 31,
 
 
  2019   2018  

Stated interest expense

  $ 3   $  

Facility fees

        1  

Amortization of debt issuance costs

         

Total interest and credit facility fees expense

  $ 3   $ 1  

Cash paid for interest expense

  $ 3   $  

Average stated interest rate

    4.28 %   3.71 %

Average outstanding balance

  $ 259   $ 10  

      Convertible Unsecured Notes

              The Company has issued $388 aggregate principal amount of unsecured convertible notes that mature on February 1, 2022 (the "2022 Convertible Notes") and $403 aggregate principal amount of unsecured convertible notes that mature on March 1, 2024 (the "2024 Convertible Notes" and together with the 2022 Convertible Notes, the "Convertible Unsecured Notes"). The Convertible Unsecured Notes mature upon their respective maturity dates unless previously converted or repurchased in accordance with their terms. The Company does not have the right to redeem the Convertible Unsecured Notes prior to maturity. The 2022 Convertible Notes and the 2024 Convertible Notes bear interest at a rate of 3.75% and 4.625%, respectively, per year, payable semi-annually.

              In certain circumstances, assuming the respective conversion date below has not already passed, the Convertible Unsecured Notes will be convertible into cash, shares of the Company's common stock or a combination of cash and shares of its common stock, at the Company's election, at their respective conversion rates (listed below as of March 31, 2019) subject to customary anti-dilution adjustments and the requirements of their respective indenture (the "Convertible Unsecured Notes Indentures"). Prior to the close of business on the business day immediately preceding their respective conversion date (listed below), holders may convert their Convertible Unsecured Notes only under certain circumstances set forth in the Convertible Unsecured Notes Indentures. On or after their respective conversion dates until the close of business on the scheduled trading day immediately preceding the maturity date for the 2022 Convertible Notes and the second scheduled trading day immediately preceding the maturity date for the 2024 Convertible Notes, holders may convert their Convertible Unsecured Notes at any time. In addition, if the Company engages in certain corporate events as described in their respective Convertible Unsecured Notes Indenture, holders of the Convertible Unsecured Notes may require the Company to repurchase for cash all or part of the Convertible

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Unsecured Notes at a repurchase price equal to 100% of the principal amount of the Convertible Unsecured Notes to be repurchased, plus accrued and unpaid interest through, but excluding, the required repurchase date.

              Certain key terms related to the convertible features for each of the Convertible Unsecured Notes as of March 31, 2019 are listed below.

 
  2022
Convertible Notes
  2024
Convertible Notes
 

Conversion premium

  15.0 % 15.0 %

Closing stock price at issuance

  $16.86   $17.29  

Closing stock price date

  January 23, 2017   March 5, 2019  

Conversion price(1)

  $19.32   $19.88  

Conversion rate (shares per one thousand dollar principal amount)(1)

  51.7581   50.2930  

Conversion dates

  August 1, 2021   December 1, 2023  

(1)
Represents conversion price and conversion rate, as applicable, as of March 31, 2019, taking into account any applicable de minimis adjustments that will be made on the conversion date.

              As of March 31, 2019, the principal amounts of each series of the Convertible Unsecured Notes exceeded the value of the underlying shares multiplied by the per share closing price of the Company's common stock.

              The Convertible Unsecured Notes Indentures contain certain covenants, including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a) of the Investment Company Act and to provide financial information to the holders of the Convertible Unsecured Notes under certain circumstances. These covenants are subject to important limitations and exceptions that are described in the Convertible Unsecured Notes Indentures. As of March 31, 2019, the Company was in compliance in all material respects with the terms of the Convertible Unsecured Notes Indentures.

              The Convertible Unsecured Notes are accounted for in accordance with ASC 470-20, Debt . Upon conversion of any of the other Convertible Unsecured Notes, the Company intends to pay the outstanding principal amount in cash and to the extent that the conversion value exceeds the principal amount, the Company has the option to pay in cash or shares of the Company's common stock (or a combination of cash and shares) in respect of the excess amount, subject to the requirements of the Convertible Unsecured Notes Indentures. The Company has determined that the embedded conversion options in the Convertible Unsecured Notes are not required to be separately accounted for as a derivative under GAAP. In accounting for the Convertible Unsecured Notes, the Company estimated at the time of issuance separate debt and equity components for each of the Convertible Unsecured Notes. An original issue discount equal to the equity components of the Convertible Unsecured Notes was recorded in "capital in excess of par value" in the accompanying consolidated balance sheet. Additionally, the issuance costs associated with the Convertible Unsecured Notes were allocated to the debt and equity components in proportion to the allocation of the proceeds and accounted for as debt issuance costs and equity issuance costs, respectively.

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              The debt and equity component percentages, the issuance costs and the equity component amounts for each of the Convertible Unsecured Notes are listed below.

 
  2022
Convertible Notes
  2024
Convertible Notes
 

Debt and equity component percentages, respectively(1)

    96.0% and 4.0 %   98.9% and 1.1 %

Debt issuance costs(1)

  $ 9   $ 4  

Equity issuance costs(1)

  $   $  

Equity component, net of issuance costs(2)

  $ 15   $ 13  

(1)
At time of issuance.

(2)
At time of issuance and as of March 31, 2019.

              In addition to the original issue discount equal to the equity component of the 2024 Convertible Notes, the 2024 Convertible Notes were issued at a discount. The Company records interest expense comprised of both stated interest expense as well as accretion of any original issue discount.

              As of March 31, 2019, the components of the carrying value of the Convertible Unsecured Notes, the stated interest rate and the effective interest rate were as follows:

 
  2022
Convertible Notes
  2024
Convertible Notes
 

Principal amount of debt

  $ 388   $ 403  

Original issue discount, net of accretion

    (9 )   (13 )

Debt issuance costs

    (5 )   (4 )

Carrying value of debt

  $ 374   $ 386  

Stated interest rate

    3.750 %   4.625 %

Effective interest rate(1)

    4.60 %   4.80 %

(1)
The effective interest rate of the debt component of the Convertible Unsecured Notes is equal to the stated interest rate plus the accretion of original issue discount.

              In January 2019, the Company repaid in full the $300 in aggregate principal amount of unsecured convertible notes (the "2019 Convertible Notes") upon their maturity. The 2019 Convertible Notes bore interest at a rate of 4.375% per year, payable semi-annually.

              For the three months ended March 31, 2019 and 2018, the components of interest expense and cash paid for interest expense for the Convertible Unsecured Notes, as well as any other convertible unsecured notes outstanding during the periods presented are listed below.

 
  For the Three
Months Ended
March 31,
 
 
  2019   2018  

Stated interest expense

  $ 5   $ 7  

Amortization of debt issuance costs

    1     1  

Accretion of original issue discount

    1     1  

Total interest expense

  $ 7   $ 9  

Cash paid for interest expense

  $ 14   $ 20  

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      Unsecured Notes

      2020 Notes

              The Company has issued $600 in aggregate principal amount of unsecured notes that mature on January 15, 2020 (the "2020 Notes"). The 2020 Notes bear interest at a rate of 3.875% per year, payable semi-annually and all principal is due upon maturity. The 2020 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2020 Notes, and any accrued and unpaid interest. $400 in aggregate principal amount of the 2020 Notes were issued at a discount to the principal amount and $200 in aggregate principal amount of the 2020 Notes were issued at a premium to the principal amount.

      2022 Notes

              The Company has issued $600 in aggregate principal amount of unsecured notes that mature on January 19, 2022 (the "2022 Notes"). The 2022 Notes bear interest at a rate of 3.625% per year, payable semi-annually and all principal is due upon maturity. The 2022 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2022 Notes, and any accrued and unpaid interest. The 2022 Notes were issued at a discount to the principal amount.

      2023 Notes

              The Company has issued $750 in aggregate principal amount of unsecured notes that mature on February 10, 2023 (the "2023 Notes"). The 2023 Notes bear interest at a rate of 3.500% per year, payable semi-annually and all principal is due upon maturity. The 2023 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2023 Notes, and any accrued and unpaid interest. The 2023 Notes were issued at a discount to the principal amount.

      2025 Notes

              The Company has issued $600 in aggregate principal amount of unsecured notes that mature on March 1, 2025 (the "2025 Notes"). The 2025 Notes bear interest at a rate of 4.250% per year, payable semi-annually and all principal is due upon maturity. The 2025 Notes may be redeemed in whole or in part at any time at the Company's option at a redemption price equal to par plus a "make whole" premium, if applicable, as determined pursuant to the indenture governing the 2025 Notes, and any accrued and unpaid interest. The 2025 Notes were issued at a discount to the principal amount.

      2047 Notes

              As part of the acquisition of Allied Capital Corporation ("Allied Capital") in April 2010 (the "Allied Acquisition"), the Company assumed $230 in aggregate principal amount of unsecured notes due on April 15, 2047 (the "2047 Notes" and together with the 2020 Notes, the 2022 Notes, the 2023 Notes and the 2025 Notes, the "Unsecured Notes"). The 2047 Notes bear interest at a rate of 6.875%, payable quarterly and all principal is due upon maturity. The 2047 Notes may be redeemed in whole or in part at any time or from time to time at the Company's option, at a par redemption price of $25.00 per security plus accrued and unpaid interest.

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              For the three months ended March 31, 2019 and 2018, the components of interest expense and cash paid for interest expense for the Unsecured Notes, as well as any other unsecured notes outstanding during the periods presented are listed below.

 
  For the Three
Months Ended
March 31,
 
 
  2019   2018  

Stated interest expense

  $ 28   $ 37  

Amortization of debt issuance costs

    1     1  

Net accretion of original issued discount

    1      

Accretion of purchase discount

         

Total interest expense

  $ 30   $ 38  

Cash paid for interest expense

  $ 51   $ 40  

              The Unsecured Notes contain certain covenants, including covenants requiring the Company to comply with Section 18(a)(1)(A) as modified by Section 61(a) of the Investment Company Act and to provide financial information to the holders of such notes under certain circumstances. These covenants are subject to important limitations and exceptions set forth in the indentures governing such notes. As of March 31, 2019, the Company was in compliance in all material respects with the terms of the respective indentures governing each of the Unsecured Notes.

              The Convertible Unsecured Notes and the Unsecured Notes are the Company's unsecured senior obligations and rank senior in right of payment to any future indebtedness that is expressly subordinated in right of payment to the Convertible Unsecured Notes and the Unsecured Notes; equal in right of payment to the Company's existing and future unsecured indebtedness that is not expressly subordinated; effectively junior in right of payment to any of its secured indebtedness (including existing unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company's subsidiaries, financing vehicles or similar facilities.

6.           DERIVATIVE INSTRUMENTS

              The Company enters into forward currency contracts from time to time to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the Company's investments denominated in foreign currencies. As of March 31, 2019 and December 31, 2018, the counterparty to these forward currency contracts was Bank of Montreal. Net unrealized gains or losses on foreign currency contracts are included in "net unrealized gains (losses) from foreign currency and other transactions" and net realized gains or losses on forward currency contracts are included in "net realized gains (losses) from foreign currency transactions" in the accompanying consolidated statement of operations.

              Forward currency contracts and interest rate swaps are considered undesignated derivative instruments.

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              Certain information related to the Company's foreign currency forward contracts is presented below as of March 31, 2019 and December 31, 2018.

 
  As of March 31, 2019
Description
  Notional
Amount
  Maturity Date   Gross Amount
of Recognized
Assets
  Gross Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Foreign currency forward contract

  £ 69     5/17/2019         (1 ) Accounts payable and other liabilities

Total

              $   $ (1 )  

 

 
  As of December 31, 2018
Description
  Notional
Amount
  Maturity Date   Gross Amount
of Recognized
Assets
  Gross Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Foreign currency forward contract

  CAD 5     1/4/2019   $   $   Other Assets

Foreign currency forward contract

  CAD 9     1/14/2019           Other Assets

Foreign currency forward contract

  CAD 103     2/15/2019     2       Other Assets

Foreign currency forward contract

  CAD 33     3/22/2019           Other Assets

Foreign currency forward contract

  15     1/14/2019           Other Assets

Foreign currency forward contract

  1     2/15/2019           Accounts payable and other liabilities

Foreign currency forward contract

  24     3/6/2019           Accounts payable and other liabilities

Foreign currency forward contract

  £ 72     2/15/2019     2       Other Assets

Total

              $ 4   $    

              In December 2017, in connection with $395 of the term loan tranche of the Revolving Credit Facility the Company entered into a three-year interest rate swap agreement to mitigate our exposure to adverse fluctuations in interest rates for a total notional amount of $395 and a maturity date of January 4, 2021. Under the interest rate swap agreement, the Company pays a fixed interest rate of 2.06% and receives a floating rate based on the prevailing one-month LIBOR. As of March 31, 2019 and December 31, 2018, the one-month LIBOR rate in effect was 2.50% and 2.44%, respectively. For the three months ended March 31, 2019 and 2018, the Company recognized $0 and $1, respectively, in realized losses related to this swap agreement. For the three months ended March 31, 2019 and 2018, the Company recognized $2 in unrealized loss and $5 in unrealized gains, respectively, related to this swap agreement. As of March 31, 2019 and December 31, 2018, this swap agreement had a fair value of $2 and $4, respectively, which is included in the "other assets", in the accompanying consolidated balance sheet. Net realized gains or losses on the interest rate swap are included in "net realized gains (losses) from foreign currency and other transactions" in the accompanying consolidated statement of operations. Net unrealized gains or losses on the interest rate swap are included in "net unrealized gains (losses) from foreign currency and other transactions" in the accompanying consolidated statements of operations.

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              Certain information related to the Company's interest rate swap is presented below as of March 31, 2019 and December 31, 2018.

 
  As of March 31, 2019
Description
  Payment Terms   Notional
Amount
  Maturity
Date
  Gross Amount
of Recognized
Assets
  Gross Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Interest rate swap

    Pay Fixed 2.0642 % Receive Floating One-Month LIBOR of 2.50%   $ 395     1/4/2021   $ 2   $   Other assets

Total

                        $ 2   $    

 

 
  As of December 31, 2018
Description
  Payment Terms   Notional
Amount
  Maturity
Date
  Gross Amount
of Recognized
Assets
  Gross Amount
of Recognized
Liabilities
  Balance Sheet
Location of
Net Amounts

Interest rate swap

    Pay Fixed 2.0642 % Receive Floating One-Month LIBOR of 2.44%   $ 395     1/4/2021   $ 4   $   Other assets

Total

                        $ 4   $    

7.           COMMITMENTS AND CONTINGENCIES

      Investment Commitments

              The Company has various commitments to fund investments in its portfolio as described below. As of March 31, 2019 and December 31, 2018, the Company had the following commitments to fund various revolving and delayed draw senior secured and subordinated loans, including commitments to fund which are at (or substantially at) the Company's discretion:

 
  As of  
 
  March 31,
2019
  December 31,
2018
 

Total revolving and delayed draw loan commitments

  $ 1,872   $ 1,915  

Less: drawn commitments

    (405 )   (377 )

Total undrawn commitments

    1,467     1,538  

Less: commitments substantially at discretion of the Company

    (8 )   (6 )

Less: unavailable commitments due to borrowing base or other covenant restrictions

         

Total net adjusted undrawn revolving and delayed draw loan commitments

  $ 1,459   $ 1,532  

              Included within the total revolving and delayed draw loan commitments as of March 31, 2019 and December 31, 2018 were delayed draw loan commitments totaling $520 and $627, respectively. The Company's commitment to fund delayed draw loans is triggered upon the satisfaction of certain pre-negotiated terms and conditions. Generally, the most significant and uncertain term requires the borrower to satisfy a specific use of proceeds covenant. The use of proceeds covenant typically requires the borrower to use the additional loans for the specific purpose of a permitted acquisition or permitted investment, for example. In addition to the use of proceeds covenant, the borrower is generally required to satisfy additional negotiated covenants (including specified leverage levels).

              Also included within the total revolving and delayed draw loan commitments as of March 31, 2019 were commitments to issue up to $325 in letters of credit through a financial intermediary on behalf of certain portfolio companies. As of March 31, 2019, the Company had $39 in letters of credit

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issued and outstanding under these commitments on behalf of portfolio companies. For all these letters of credit issued and outstanding, the Company would be required to make payments to third parties if the portfolio companies were to default on their related payment obligations. Of these letters of credit, $27 expire in 2019 and $12 expire in 2020. As of March 31, 2019, the Company recorded a liability of $1 for certain letters of credit issued and outstanding and none of the other letters of credit issued and outstanding were recorded as a liability on the Company's balance sheet as such other letters of credit are considered in the valuation of the investments in the portfolio company.

              The Company also has commitments to co-invest in the SDLP for the Company's portion of the SDLP's commitments to fund delayed draw loans to certain portfolio companies of the SDLP. See Note 4 for more information.

              As of March 31, 2019 and December 31, 2018, the Company was party to subscription agreements to fund equity investments in private equity investment partnerships as follows:

 
  As of  
 
  March 31,
2019
  December 31,
2018
 

Total private equity commitments

  $ 115   $ 114  

Less: funded private equity commitments

    (69 )   (73 )

Total unfunded private equity commitments

    46     41  

Less: private equity commitments substantially at discretion of the Company

    (46 )   (41 )

Total net adjusted unfunded private equity commitments

  $   $  

              In the ordinary course of business, the Company may sell certain of its investments to third party purchasers. In particular, in connection with the sale of certain controlled portfolio company equity investments (as well as certain other sales) the Company has, and may continue to do so in the future, agreed to indemnify such purchasers for future liabilities arising from the investments and the related sale transaction. Such indemnification provisions have given rise to liabilities in the past and may do so in the future.

              In addition, in the ordinary course of business, the Company may guarantee certain obligations in connection with its portfolio companies (in particular, certain controlled portfolio companies). Under these guarantee arrangements, payments may be required to be made to third parties if such guarantees are called upon or if the portfolio companies were to default on their related obligations, as applicable.

      Lease Commitments

              The Company is obligated under a number of operating leases pursuant to which it is leasing office facilities from third parties with remaining terms ranging from less than one year to 8 years. For certain of its operating leases, the Company has entered into subleases including one with Ares Management. See Note 12 for a further description of the sublease with Ares Management.

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              The components of operating lease expense for the three months ended March 31, 2019 were as follows:

 
  Three Months
Ended
March 31, 2019
 

Operating lease costs

  $ 4.8  

Less: sublease income

    (4.4 )

Total operating lease costs(1)

  $ 0.4  

(1)
Total operating lease costs are incurred from office leases assumed as part of the American Capital Acquisition.

              Supplemental cash flow information related to operating leases for the three months ended March 31, 2019 was as follows:

 
  Three Months
Ended
March 31, 2019
 

Cash paid for amounts included in the measurement of operating lease liabilities

  $ 5.9  

Operating ROU assets obtained in exchange for operating lease liabilities

  $ 3.2  

              Supplemental balance sheet information as of March 31, 2019 related to operating leases was as follows:

 
  As of
March 31, 2019
 

Operating lease ROU assets

  $ 105.3  

Operating lease liabilities

  $ 136.7  

Weighted average remaining lease term

    5.5 years  

Weighted average discount rate

    4.1 %

              The following table shows future minimum lease payments under the Company's operating leases and a reconciliation to the operating lease liability as of March 31, 2019:

 
  As of
March 31, 2019
 

2019

  $ 17.9  

2020

    24.2  

2021

    24.9  

2022

    25.1  

2023

    25.2  

Thereafter

    38.8  

Total lease payments

    156.1  

Less imputed interest

    (19.4 )

Total operating lease liability

  $ 136.7  

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8.           FAIR VALUE OF FINANCIAL INSTRUMENTS

              The Company follows ASC 825-10, R ecognition and Measurement of Financial Assets and Financial Liabilities , which provides companies the option to report selected financial assets and liabilities at fair value. ASC 825-10 also establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect of the company's choice to use fair value on its earnings. ASC 825-10 also requires entities to display the fair value of the selected assets and liabilities on the face of the balance sheet. The Company has not elected the ASC 825-10 option to report selected financial assets and liabilities at fair value. With the exception of the line items entitled "other assets" and "debt," which are reported at amortized cost, all assets and liabilities approximate fair value on the balance sheet. The carrying value of the lines titled "interest receivable," "receivable for open trades," "payable for open trades," "accounts payable and other liabilities," "base management fees payable," "income based fees payable," "capital gains incentive fees payable" and "interest and facility fees payable" approximate fair value due to their short maturity.

              The Company also follows ASC 820-10, Fair Value Measurements and Disclosures , which expands the application of fair value accounting. ASC 820-10 defines fair value, establishes a framework for measuring fair value in accordance with GAAP and expands disclosure of fair value measurements. ASC 820-10 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Company to assume that the portfolio investment is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market, which may be a hypothetical market. Market participants are defined as buyers and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. In accordance with ASC 820-10, the Company has considered its principal market as the market in which the Company exits its portfolio investments with the greatest volume and level of activity. ASC 820-10 specifies a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. In accordance with ASC 820-10, these inputs are summarized in the three broad levels listed below:

    Level 1—Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

    Level 2—Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

    Level 3—Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

              In addition to using the above inputs in investment valuations, the Company continues to employ the net asset valuation policy approved by the Company's board of directors that is consistent with ASC 820-10 (see Note 2 for more information). Consistent with the Company's valuation policy, it evaluates the source of inputs, including any markets in which the Company's investments are trading (or any markets in which securities with similar attributes are trading), in determining fair value. The Company's valuation policy considers the fact that because there is not a readily available market value for most of the investments in the Company's portfolio, the fair value of the investments must typically be determined using unobservable inputs.

              The Company's portfolio investments (other than as described below in the following paragraph) are typically valued using two different valuation techniques. The first valuation technique is an analysis of the enterprise value ("EV") of the portfolio company. Enterprise value means the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time. The primary method for

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determining EV uses a multiple analysis whereby appropriate multiples are applied to the portfolio company's EBITDA (generally defined as net income before net interest expense, income tax expense, depreciation and amortization). EBITDA multiples are typically determined based upon review of market comparable transactions and publicly traded comparable companies, if any. The Company may also employ other valuation multiples to determine EV, such as revenues or, in the case of certain portfolio companies in the power generation industry, kilowatt capacity. The second method for determining EV uses a discounted cash flow analysis whereby future expected cash flows of the portfolio company are discounted to determine a present value using estimated discount rates (typically a weighted average cost of capital based on costs of debt and equity consistent with current market conditions). The EV analysis is performed to determine the value of equity investments, the value of debt investments in portfolio companies where the Company has control or could gain control through an option or warrant security, and to determine if there is credit impairment for debt investments. If debt investments are credit impaired, an EV analysis may be used to value such debt investments; however, in addition to the methods outlined above, other methods such as a liquidation or wind-down analysis may be utilized to estimate enterprise value. The second valuation technique is a yield analysis, which is typically performed for non-credit impaired debt investments in portfolio companies where the Company does not own a controlling equity position. To determine fair value using a yield analysis, a current price is imputed for the investment based upon an assessment of the expected market yield for a similarly structured investment with a similar level of risk. In the yield analysis, the Company considers the current contractual interest rate, the maturity and other terms of the investment relative to risk of the company and the specific investment. A key determinant of risk, among other things, is the leverage through the investment relative to the enterprise value of the portfolio company. As debt investments held by the Company are substantially illiquid with no active transaction market, the Company depends on primary market data, including newly funded transactions, as well as secondary market data with respect to high yield debt instruments and syndicated loans, as inputs in determining the appropriate market yield, as applicable.

              For other portfolio investments such as investments in the SDLP Certificates, discounted cash flow analysis is the primary technique utilized to determine fair value. Expected future cash flows associated with the investment are discounted to determine a present value using a discount rate that reflects estimated market return requirements.

              The following tables summarize the significant unobservable inputs the Company used to value the majority of its investments categorized within Level 3 as of March 31, 2019 and December 31, 2018. The tables are not intended to be all-inclusive, but instead capture the significant unobservable inputs relevant to the Company's determination of fair values.

 
  As of March 31, 2019  
 
   
   
  Unobservable Input  
Asset Category
  Fair
Value
  Primary
Valuation
Techniques
  Input   Estimated
Range
  Weighted
Average
 

First lien senior secured loans

  $ 5,785   Yield analysis   Market yield   5.2% - 17.2%     9.0 %

Second lien senior secured loans

    3,976   Yield analysis   Market yield   9.6% - 25.0%     11.8 %

Subordinated certificates of the SDLP

    792   Discounted cash flow analysis   Discount rate   12.3% - 13.3%     12.8 %

Senior subordinated loans

    742   Yield analysis   Market yield   10.0% - 15.9%     12.5 %

Collateralized loan obligations

    43   Discounted cash flow analysis   Discount rate   10.0% - 15.6%     14.1 %

            Constant prepayment rate   10.0% - 30.0%     20.0 %

            Constant default rate   1.0% - 2.5%     2.0 %

Preferred equity securities

    601   EV market multiple analysis   EBITDA multiple   3.7x - 20.0x     12.7x  

Other equity securities

    1,116   EV market multiple analysis   EBITDA multiple   5.0x - 22.9x     11.1x  

Total investments

  $ 13,055                    

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  As of December 31, 2018  
 
   
   
  Unobservable Input  
Asset Category
  Fair
Value
  Primary
Valuation
Techniques
  Input   Estimated
Range
  Weighted
Average
 

First lien senior secured loans

  $ 5,836   Yield analysis   Market yield   5.4% - 17.1%     9.2 %

Second lien senior secured loans

    3,657   Yield analysis   Market yield   9.8% - 20.02%     11.9 %

Subordinated certificates of the SDLP

    652   Discounted cash flow analysis   Discount rate   12.5% - 13.5%     13.0 %

Senior subordinated loans

    727   Yield analysis   Market yield   10.0% - 16.8%     13.0 %

Collateralized loan obligations

    45   Discounted cash flow analysis   Discount rate   10.0% - 15.6%     14.1 %

            Constant prepayment rate   10.0% - 30.0%     20.0 %

            Constant default rate   1.0% - 2.5%     2.0 %

Preferred equity securities

    444   EV market multiple analysis   EBITDA multiple   4.2x - 20.0x     12.9x  

Other equity securities

    1,046   EV market multiple analysis   EBITDA multiple   5.0x - 22.9x     10.8x  

Total investments

  $ 12,407                    

              Changes in market yields, discount rates or EBITDA multiples, each in isolation, may change the fair value of certain of the Company's investments. Generally, an increase in market yields or discount rates or decrease in EBITDA multiples may result in a decrease in the fair value of certain of the Company's investments.

              Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Company's investments may fluctuate from period to period. Additionally, the fair value of the Company's investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that the Company may ultimately realize. Further, such investments are generally subject to legal and other restrictions on resale or otherwise are less liquid than publicly traded securities. If the Company was required to liquidate a portfolio investment in a forced or liquidation sale, it could realize significantly less than the value at which the Company has recorded it.

              In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected in the valuations currently assigned.

              The following table presents fair value measurements of cash and cash equivalents, investments and derivatives as of March 31, 2019:

 
  Fair Value Measurements Using  
 
  Total   Level 1   Level 2   Level 3  

Cash and cash equivalents

  $ 572   $ 572   $   $  

Investments not measured at net asset value

  $ 13,055   $   $   $ 13,055  

Investments measured at net asset value(1)

  $ 9                    

Total investments

  $ 13,064                    

Derivatives

  $ 1   $   $ 1   $  

(1)
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet.

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              The following table presents fair value measurements of cash and cash equivalents, investments and derivatives as of December 31, 2018:

 
  Fair Value Measurements Using  
 
  Total   Level 1   Level 2   Level 3  

Cash and cash equivalents

  $ 296   $ 296   $   $  

Investments not measured at net asset value

  $ 12,407   $   $   $ 12,407  

Investments measured at net asset value(1)

  $ 10                    

Total investments

  $ 12,417                    

Derivatives

  $ 8   $   $ 8   $  

(1)
Certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been categorized in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet.

              The following table presents changes in investments that use Level 3 inputs as of and for the three months ended March 31, 2019:

 
  As of and For the
Three Months Ended
March 31, 2019
 

Balance as of December 31, 2018

  $ 12,407  

Net realized gains

    7  

Net unrealized losses

    (39 )

Purchases

    1,935  

Sales

    (699 )

Redemptions

    (590 )

PIK interest and dividends

    30  

Net accretion of discount on securities

    4  

Net transfers in and/or out of Level 3

     

Balance as of March 31, 2019

  $ 13,055  

              As of March 31, 2019, the net unrealized depreciation on the investments that use Level 3 inputs was $392. For the three months ended March 31, 2019, there were no net transfers out of Level 3.

              For the three months ended March 31, 2019, the total amount of gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to the Company's Level 3 assets still held as of March 31, 2019, and reported within the net unrealized gains (losses) from investments, foreign currency and other transactions in the Company's consolidated statement of operations was $(38).

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              The following table presents changes in investments that use Level 3 inputs as of and for the three months ended March 31, 2018:

 
  As of and For the
Three Months Ended
March 31, 2018
 

Balance as of December 31, 2017

  $ 11,824  

Net realized losses

     

Net unrealized gains

    95  

Purchases

    1,603  

Sales

    (302 )

Redemptions

    (1,066 )

PIK interest and dividends

    24  

Net accretion of discount on securities

    4  

Net transfers in and/or out of Level 3

     

Balance as of March 31, 2018

  $ 12,182  

              As of March 31, 2018, the net unrealized appreciation on the investments that use Level 3 inputs was $14. For the three months ended March 31, 2018, there were no net transfers out of Level 3.

              For the three months ended March 31, 2018, the total amount of gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to the Company's Level 3 assets still held as of March 31, 2018, and reported within the net unrealized gains (losses) from investments, foreign currency and other transactions in the Company's consolidated statement of operations was $89.

              Following are the carrying and fair values of the Company's debt obligations as of March 31, 2019 and December 31, 2018. Fair value is estimated by discounting remaining payments using

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applicable current market rates, which take into account changes in the Company's marketplace credit ratings, or market quotes, if available.

 
  As of  
 
  March 31, 2019   December 31, 2018  
 
  Carrying
value(1)
  Fair
value
  Carrying
value(1)
  Fair
value
 

Revolving Credit Facility

  $ 1,997   $ 1,997   $ 1,064   $ 1,064  

Revolving Funding Facility

    620     620     520     520  

SMBC Funding Facility

    105     105     245     245  

2019 Convertible Notes (principal amount outstanding of $0 and $300, respectively)

            300 (2)   300  

2022 Convertible Notes (principal amount outstanding of $388)

    374 (2)   379     372 (2)   388  

2024 Convertible Notes (principal amount outstanding of $403 and $0, respectively)

    386 (2)   400          

2020 Notes (principal amount outstanding of $600)

    599 (3)   603     598 (3)   602  

2022 Notes (principal amount outstanding of $600)

    595 (4)   602     595 (4)   584  

2023 Notes (principal amount outstanding of $750)

    745 (5)   727     744 (5)   711  

2025 Notes (principal amount outstanding of $600)

    593 (6)   586     593 (6)   570  

2047 Notes (principal amount outstanding of $230)

    183 (7)   229     183 (7)   224  

  $ 6,197 (8) $ 6,248   $ 5,214 (8) $ 5,208  

(1)
The Revolving Credit Facility, the Revolving Funding Facility and the SMBC Funding Facility carrying values are the same as the principal amounts outstanding.

(2)
Represents the aggregate principal amount outstanding of the Convertible Unsecured Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuances of such notes.

(3)
Represents the aggregate principal amount outstanding of the 2020 Notes less unamortized debt issuance costs and the net unaccreted discount recorded upon the issuances of the 2020 Notes.

(4)
Represents the aggregate principal amount outstanding of the 2022 Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2022 Notes.

(5)
Represents the aggregate principal amount outstanding of the 2023 Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2023 Notes.

(6)
Represents the aggregate principal amount outstanding of the 2025 Notes less unamortized debt issuance costs and the unaccreted discount recorded upon the issuance of the 2025 Notes.

(7)
Represents the aggregate principal amount outstanding of the 2047 Notes less the unaccreted purchased discount.

(8)
Total principal amount of debt outstanding totaled $6,293 and $5,297 as of March 31, 2019 and December 31, 2018, respectively.

              The following table presents fair value measurements of the Company's debt obligations as of March 31, 2019 and December 31, 2018:

 
  As of  
Fair Value Measurements Using
  March 31,
2019
  December 31,
2018
 

Level 1

  $ 229   $ 224  

Level 2

    6,019     4,984  

Total

  $ 6,248   $ 5,208  

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9.           STOCKHOLDERS' EQUITY

              There were no issuances of the Company's equity securities for the three months ended March 31, 2019 and 2018. See Note 11 for information regarding shares of common stock issued or purchased in accordance with the Company's dividend reinvestment plan.

      Stock Repurchase Program

              The Company is authorized under its stock repurchase program to purchase up to $500 in the aggregate of its outstanding common stock in the open market at certain thresholds below its net asset value per share, in accordance with the guidelines specified in Rule 10b-18 under the Securities Exchange Act of 1934, as amended. The timing, manner, price and amount of any share repurchases will be determined by the Company, in its discretion, based upon the evaluation of economic and market conditions, stock price, applicable legal and regulatory requirements and other factors. The program does not require the Company to repurchase any specific number of shares, and the Company cannot assure stockholders that any shares will be repurchased under the program. The expiration date of the stock repurchase program is February 15, 2020. The program may be suspended, extended, modified or discontinued at any time.

              As of March 31, 2019, the Company had repurchased a total of 0.5 shares of its common stock in the open market under the stock repurchase program since the program's inception in September 2015, at an average price of $13.92 per share, including commissions paid, leaving approximately $493 available for additional repurchases under the program. During the three months ended March 31, 2019 and 2018, the Company did not repurchase any shares of the Company's common stock under the stock repurchase program.

10.         EARNINGS PER SHARE

              The following information sets forth the computations of basic and diluted net increase in stockholders' equity resulting from operations per share for the three months ended March 31, 2019 and 2018:

 
  For the
Three Months
Ended
March 31,
 
 
  2019   2018  

Net increase in stockholders' equity resulting from operations available to common stockholders

  $ 214   $ 242  

Weighted average shares of common stock outstanding—basic and diluted

    426     426  

Basic and diluted net increase in stockholders' equity resulting from operations per share

  $ 0.50   $ 0.57  

              For the purpose of calculating diluted net increase in stockholders' equity resulting from operations per share, the average closing price of the Company's common stock for the three months ended March 31, 2019 was less than the conversion price for each of the Convertible Unsecured Notes outstanding as of March 31, 2019, as well as any other convertible unsecured notes outstanding during the period. For the three months ended March 31, 2018, the average closing price of the Company's common stock was less than the conversion price for each of the Convertible Unsecured Notes outstanding as of March 31, 2018, as well as any other convertible unsecured notes outstanding during the period. Therefore, for all periods presented in the financial statements, the underlying shares for the intrinsic value of the embedded options in the Convertible Unsecured Notes and any other

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convertible unsecured notes outstanding during the periods presented had no impact on the computation of diluted net increase in stockholders' equity resulting from operations per share.

11.         DIVIDENDS AND DISTRIBUTIONS

              The following table summarizes the Company's dividends declared and payable during the three months ended March 31, 2019 and 2018:

Date declared
  Record date   Payment date   Per share
amount
  Total
amount
 

February 12, 2019

  March 15, 2019   March 29, 2019   $ 0.40   $ 170  

February 12, 2019

  March 15, 2019   March 29, 2019     0.02 (1)   9  

Total declared and payable for the three months ended March 31, 2019

          $ 0.42   $ 179  

February 13, 2018

  March 15, 2018   March 30, 2018   $ 0.38   $ 162  

Total declared and payable for the three months ended March 31, 2018

          $ 0.38   $ 162  

(1)
Represents an additional dividend.

              The Company has a dividend reinvestment plan, whereby the Company may buy shares of its common stock in the open market or issue new shares in order to satisfy dividend reinvestment requests. When the Company issues new shares in connection with the dividend reinvestment plan, the issue price is equal to the closing price of its common stock on the dividend payment date. Dividend reinvestment plan activity for the three months ended March 31, 2019 and 2018, was as follows:

 
  For the
Three Months
Ended
March 31,
 
 
  2019   2018  

Shares issued

         

Average issue price per share

  $   $  

Shares purchased by plan agent to satisfy dividends declared and payable during the period for stockholders

    0.5 (1)   0.5 (2)

Average purchase price per share

  $ 17.42   $ 15.90  

(1)
Shares were purchased in April 2019.

(2)
Shares were purchased in April 2018.

12.         RELATED PARTY TRANSACTIONS

              In accordance with the investment advisory and management agreement, the Company bears all costs and expenses of the operation of the Company and reimburses its investment adviser or its affiliates for certain of such costs and expenses paid for by the investment adviser or its affiliates on behalf of the Company. For the three months ended March 31, 2019 and 2018, the Company's investment adviser or its affiliates incurred and the Company reimbursed such expenses totaling $1 and $1, respectively. The Company's investment adviser reimbursed the Company approximately $0.5 for certain rent and utilities incurred by the Company during the first quarter of 2018. In addition, during the second quarter of 2018, the Company's investment adviser reimbursed the Company approximately $2.2, $3.0, $3.2 and $2.9 of rent and utilities for the years ended 2017, 2016, 2015 and 2014,

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respectively, for an aggregate reimbursement to the Company of $11.8. Beginning April 1, 2018, the Company's investment adviser will bear such rent and utilities expenses.

              The Company is party to office leases pursuant to which it is leasing office facilities from third parties. Prior to March 31, 2018, for certain of these office leases, the Company had entered into separate subleases with Ares Management LLC, the sole member of Ares Capital Management, and IHAM, pursuant to which Ares Management LLC and IHAM subleased office space from the Company. In October 2018, the Company terminated all of its existing office space subleases with Ares Management LLC and IHAM. The Company then entered into a new sublease solely with Ares Management LLC, whereby Ares Management LLC subleased the full amount of certain of the Company's office leases. The other office leases not subleased to Ares Management LLC are office leases assumed as part of the American Capital Acquisition.

              The Company has also entered into agreements with Ares Management LLC and IHAM, pursuant to which Ares Management LLC and IHAM are entitled to use the Company's proprietary portfolio management software. For the three months ended March 31, 2019 and 2018, amounts payable to the Company under these agreements totaled $0 and 0, respectively.

              See Notes 3, 4 and 6 for descriptions of other related party transactions.

13.         FINANCIAL HIGHLIGHTS

              The following is a schedule of financial highlights as of and for the three months ended March 31, 2019 and 2018:

 
  As of and For the
Three Months
Ended March 31,
 
Per Share Data:
  2019   2018  

Net asset value, beginning of period(1)

  $ 17.12   $ 16.65  

Issuances of convertible notes

    0.01      

Net investment income for period(2)

    0.47     0.34  

Net realized and unrealized gains for period(2)

    0.03     0.23  

Net increase in stockholders' equity

    0.51     0.57  

Total distributions to stockholders

    (0.42 )   (0.38 )

Net asset value at end of period(1)

  $ 17.21   $ 16.84  

Per share market value at end of period

  $ 17.14   $ 15.87  

Total return based on market value(3)

    12.71 %   3.37 %

Total return based on net asset value(4)

    2.98 %   3.41 %

Shares outstanding at end of period

    426     426  

Ratio/Supplemental Data:

             

Net assets at end of period

  $ 7,339   $ 7,178  

Ratio of operating expenses to average net assets(5)(6)

    9.30 %   9.56 %

Ratio of net investment income to average net assets(5)(7)

    11.13 %   7.87 %

Portfolio turnover rate(5)

    41 %   46 %

(1)
The net assets used equals the total stockholders' equity on the consolidated balance sheet.

(2)
Weighted average basic per share data.

(3)
For the three months ended March 31, 2019, the total return based on market value equaled the increase of the ending market value at March 31, 2019 of $17.14 per share

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    from the ending market value at December 31, 2018 of $15.58 per share plus the declared and payable dividends of $0.42 per share for the three months ended March 31, 2019, divided by the market value at December 31, 2018. For the three months ended March 31, 2018, the total return based on market value equaled the increase of the ending market value at March 31, 2018 of $15.87 per share from the ending market value at December 31, 2017 of $15.72 per share plus the declared and payable dividends of $0.38 per share for the three months ended March 31, 2018, divided by the market value at December 31, 2017. The Company's shares fluctuate in value. The Company's performance changes over time and currently may be different than that shown. Past performance is no guarantee of future results.

(4)
For the three months ended March 31, 2019, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $0.42 per share for the three months ended March 31, 2019, divided by the beginning net asset value for the period. For the three months ended March 31, 2018, the total return based on net asset value equaled the change in net asset value during the period plus the declared and payable dividends of $0.38 per share for the three months ended March 31, 2018, divided by the beginning net asset value for the period. These calculations are adjusted for shares issued in connection with the dividend reinvestment plan, the issuance of common stock in connection with any equity offerings and the equity components of any convertible notes issued during the period. The Company's performance changes over time and currently may be different than that shown. Past performance is no guarantee of future results.

(5)
The ratios reflect an annualized amount.

(6)
For the three months ended March 31, 2019, the ratio of operating expenses to average net assets consisted of 2.70% of base management fees, 2.27% of income based fees and capital gains incentive fees, net of the Fee Waiver (2.82% of income based fees and capital gains incentive fees, excluding the Fee Waiver), 3.70% of the cost of borrowing and 0.63% of other operating expenses. For the three months ended March 31, 2018, the ratio of operating expenses to average net assets consisted of 2.60% of base management fees, 2.73% of income based fees and capital gains incentive fees, net of the Fee Waiver (3.29% of income based fees and capital gains incentive fees, excluding the Fee Waiver), 3.41% of the cost of borrowing and 0.82% of other operating expenses.

(7)
The ratio of net investment income to average net assets excludes income taxes related to realized gains and losses.

14.         LITIGATION

              The Company is party to certain lawsuits in the normal course of business. In addition, American Capital and Allied Capital were involved in various legal proceedings that the Company assumed in connection with the American Capital Acquisition and the Allied Acquisition, respectively. Furthermore, third parties may try to seek to impose liability on the Company in connection with the Company's activities or the activities of its portfolio companies. While the outcome of any such legal proceedings cannot at this time be predicted with certainty, the Company does not expect that these legal proceedings will materially affect its business, financial condition or results of operations.

              On May 20, 2013, the Company was named as one of several defendants in an action filed in the United States District Court for the Eastern District of Pennsylvania by the bankruptcy trustee of DSI Renal Holdings LLC ("DSI Renal") and two affiliate companies. On March 17, 2014, the motion by the Company and the other defendants to transfer the case to the United States District Court for the District of Delaware (the "Delaware Court") was granted. On May 6, 2014, the Delaware Court

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referred the matter to the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). The complaint alleges, among other things, that each of the named defendants participated in a purported fraudulent transfer involving the restructuring of a subsidiary of DSI Renal. Among other things, the complaint seeks, jointly and severally from all defendants, (1) damages of approximately $425, of which the complaint states the Company's individual share is approximately $117, (2) interest thereon according to law, and (3) punitive damages. The defendants filed a motion to dismiss all claims on August 5, 2013. On July 20, 2017, the Bankruptcy Court issued an order granting the motion to dismiss certain claims and denying the motion to dismiss certain other claims, including the purported fraudulent transfer claims. The defendants answered the complaint on August 31, 2017. Under the operative scheduling order, discovery ended on March 29, 2019 with dispositive motions due on April 30, 2019. No trial date has been set. The Company is currently unable to assess with any certainty whether it may have any exposure in this matter. However, the Company believes the plaintiff's claims are without merit and intends to vigorously defend itself in this matter.

              On August 3, 2017, American Capital and one of its former portfolio companies were awarded a judgment plus prejudgment interest by the United States District Court for the District of Maryland (the "District Court") following a bench trial in a case first filed by one of American Capital's insurance companies concerning coverage for bodily injury claims against American Capital and/or its former portfolio company. The District Court found that the carrier breached its duty to defend American Capital and its former portfolio company against more than 1,000 bodily injury claims and awarded American Capital damages plus prejudgment interest. American Capital's carrier filed a notice of appeal to the United States Court of Appeals for the Fourth Circuit (the "Court of Appeals"); thereafter, American Capital and its former portfolio company filed a notice of cross appeal, including cross claims. The appeal was fully briefed and oral argument on the appeal took place on September 6, 2018. On February 6, 2019, the Court of Appeals entered a judgment affirming the District Court judgment in all respects in the amount of approximately $89. The carrier filed petitions for rehearing and rehearing en banc, both of which were denied by the Court of Appeals on March 7, 2019. On March 15, 2019, the carrier paid the approximately $89 judgment in full, of which the American Capital share was approximately $53. In connection with the payment of the judgment, the Company recognized a $46 realized gain, which was net of previously secured judgment insurance. The realized gain is included in "net realized gains (losses) from foreign currency and other transactions" in the accompanying consolidated statement of operations. American Capital also intends to petition the District Court for recovery of its reasonable legal fees and costs in connection with the litigation. The extent of American Capital's recovery of such fees and costs is not yet known. The Company expects that the earliest this matter will be resolved is the end of the second quarter of 2019.

15.         SUBSEQUENT EVENTS

              The Company's management has evaluated subsequent events through the date of issuance of the consolidated financial statements included herein. There have been no subsequent events that occurred during such period that would require disclosure in this Form 10-Q or would be required to be recognized in the consolidated financial statements as of and for the three months ended March 31, 2019, except as discussed below.

              In April 2019, the Company amended and restated the Revolving Credit Facility to, among other things, (a) increase the total size under the credit facility from approximately $2.1 billion to approximately $3.4 billion, (b) increase the size of the letter of credit sub-facility from $150 million to $200 million, with the ability of the Company to increase incrementally by $75 million on an uncommitted basis, (c) extend the expiration of the revolving period with respect to all commitments of the lenders under the credit facility to March 30, 2023, during which period the Company, subject to certain conditions, may make borrowings under the credit facility, and (d) extend the stated maturity date with respect to all commitments of the lenders under the credit facility to March 30, 2024.

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              On April 24, 2019, at an in-person meeting, the Company's board of directors approved the form of Second Amended and Restated Advisory and Management Agreement to be entered into by the Company and its investment adviser, effective as of June 6, 2019. The Second Amended and Restated Advisory and Management Agreement will reduce the rate used in calculating the base management fee calculated thereunder from 1.50% to 1.00% per annum with respect to assets financed using leverage over 1.0x debt to equity.

              On April 24, 2019, the Company's board of directors appointed (i) Lisa Morgan as Chief Compliance Officer of the Company, replacing Miriam Krieger who had served in such capacity since July 2011, and (ii) Miriam Krieger as Vice President of the Company.

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PART C

Other information

ITEM 25.    FINANCIAL STATEMENTS AND EXHIBITS

(1)
Financial Statements

        The following statements of the Company are included in Part A of this Registration Statement:

ARES CAPITAL CORPORATION

   

Audited Annual Financial Statements

   

Reports of Independent Registered Public Accounting Firm

  F-2

Consolidated Balance Sheet as of December 31, 2018 and 2017

  F-5

Consolidated Statement of Operations for the years ended December 31, 2018, 2017 and 2016

  F-6

Consolidated Schedules of Investments as of December 31, 2018 and 2017

  F-7

Consolidated Statement of Stockholders' Equity for the years ended December 31, 2018, 2017 and 2016

  F-93

Consolidated Statement of Cash Flows for the years ended December 31, 2018, 2017 and 2016

  F-94

Notes to Consolidated Financial Statements

  F-95

Interim Unaudited Financial Statements

 
 

Consolidated Balance Sheet as of March 31, 2019 (unaudited) and December 31, 2018

  F-142

Consolidated Statement of Operations for the three months ended March 31, 2019 and 2018 (unaudited)

  F-143

Consolidated Schedules of Investments as of March 31, 2019 (unaudited) and December 31, 2018

  F-144

Consolidated Statement of Stockholders' Equity for the three months ended March 31, 2019 (unaudited) and the year ended December 31, 2018

  F-242

Consolidated Statement of Cash Flows for the three months ended March 31, 2019 and 2018 (unaudited)

  F-243

Notes to Consolidated Financial Statements (unaudited)

  F-244
(2)
Exhibits

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(d)(6)   Third Supplemental Indenture, dated as of March 28, 2007, between Allied Capital Corporation and The Bank of New York, as trustee(7)

(d)(7)

 

Form of 6.875% Notes due 2047(7)

(d)(8)

 

Fourth Supplemental Indenture, dated as of April 1, 2010, among Ares Capital Corporation, Allied Capital Corporation and The Bank of New York Mellon, as trustee(8)

(d)(9)

 

Indenture, dated as of October 21, 2010, between Ares Capital Corporation and U.S. Bank National Association, as trustee(9)

(d)(10)

 

Fourth Supplemental Indenture, dated as of November 19, 2013, relating to the 4.875% Senior Notes due 2018, between Ares Capital Corporation and U.S. Bank National Association, as trustee(10)

(d)(11)

 

Form of 4.875% Senior Notes due 2018(10)

(d)(12)

 

Fifth Supplemental Indenture, dated as of November 21, 2014, relating to the 3.875% Notes due 2020, between Ares Capital Corporation and U.S. Bank National Association, as trustee(11)

(d)(13)

 

Form of 3.875% Notes due 2020(11)

(d)(14)

 

Sixth Supplemental Indenture, dated as of September 19, 2016, relating to the 3.625% Notes due 2022, between Ares Capital Corporation and U.S. Bank National Association, as trustee(12)

(d)(15)

 

Form of 3.625% Notes due 2022(12)

(d)(16)

 

Seventh Supplemental Indenture, dated as of August 10, 2017, relating to the 3.500% Notes due 2023, between Ares Capital Corporation and U.S. Bank National Association, as trustee(13)

(d)(17)

 

Form of 3.500% Notes due 2023(13)

(d)(18)

 

Eighth Supplemental Indenture, dated as of January 11, 2018, relating to the 4.250% Notes due 2025, between Ares Capital Corporation and U.S. Bank National Association, as trustee(14)

(d)(19)

 

Form of 4.250% Notes due 2025(14)

(d)(20)

 

Ninth Supplemental Indenture, relating to the 4.625% Convertible Notes due 2024, dated as of March 8, 2019, between Ares Capital Corporation and U.S. Bank National Association, as trustee(15)

(d)(21)

 

Form of 4.625% Convertible Senior Notes due 2024(15)

(d)(22)

 

Indenture, dated as of July 19, 2013, between Ares Capital Corporation and U.S. Bank National Association, as trustee(16)

(d)(23)

 

Form of 4.375% Convertible Senior Notes due 2019(16)

(d)(24)

 

Indenture, dated as of January 27, 2017, between Ares Capital Corporation and U.S. Bank National Association, as trustee(17)

(d)(25)

 

Form of 3.75% Convertible Senior Notes due 2022(17)

(e)

 

Dividend Reinvestment Plan of Ares Capital Corporation(2)

(f)

 

Not Applicable

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(g)(1)   Restated Investment Advisory and Management Agreement, dated as of June 6, 2011, between Registrant and Ares Capital Management LLC(18)

(g)(2)

 

Form of Second Amended and Restated Investment Advisory and Management Agreement, between Registrant and Ares Capital Management LLC, to be dated as of June 6, 2019*

(g)(3)

 

Transaction Support and Fee Waiver Agreement, dated May 23, 2016, between Ares Capital Corporation and Ares Capital Management LLC(19)

(h)(1)

 

Form of Underwriting Agreement for Equity Securities*

(h)(2)

 

Form of Underwriting Agreement for Debt Securities*

(h)(3)

 

Form of Equity Distribution Agreement*

(i)

 

Not Applicable

(j)(1)

 

Amended and Restated Custodian Agreement, dated as of May 15, 2009, between Ares Capital Corporation and U.S. Bank National Association(20)

(j)(2)

 

Amendment No. 1, dated as of December 19, 2014, to the Amended and Restated Custodian Agreement dated as of May 15, 2009, by and among Ares Capital Corporation and U.S. Bank National Association(21)

(k)(1)

 

Amended and Restated Administration Agreement, dated as of June 1, 2007, between Ares Capital Corporation and Ares Operations LLC(22)

(k)(2)

 

Trademark License Agreement between Ares Capital Corporation and Ares Management LLC(23)

(k)(3)

 

Form of Indemnification Agreement between Ares Capital Corporation and directors and certain officers(24)

(k)(4)

 

Form of Indemnification Agreement between Ares Capital Corporation and members of Ares Capital Management LLC investment committee(24)

(k)(5)

 

Amended and Restated Purchase and Sale Agreement, dated as of January 22, 2010, among Ares Capital Corporation, as seller, and Ares Capital CP Funding Holdings LLC, as purchaser(25)

(k)(6)

 

Amendment No. 1 to Amended and Restated Purchase and Sale Agreement, dated as of June 7, 2012, among Ares Capital Corporation, as seller, and Ares Capital CP Funding Holdings LLC, as purchaser(26)

(k)(7)

 

Second Tier Purchase and Sale Agreement, dated as of January 22, 2010, among Ares Capital CP Funding Holdings LLC, as seller, and Ares Capital CP Funding LLC, as purchaser(25)

(k)(8)

 

Amendment No. 1 to Second Tier Purchase and Sale Agreement, dated as of June 7, 2012, among Ares Capital CP Funding Holdings LLC, as seller, and Ares Capital CP Funding LLC, as purchaser(26)

(k)(9)

 

Amended and Restated Sale and Servicing Agreement, dated as of January 22, 2010, among Ares Capital CP Funding LLC, as borrower, Ares Capital Corporation, as servicer, Wachovia Bank, National Association, as note purchaser, U.S. Bank National Association, as trustee and collateral custodian, and Wells Fargo Securities, LLC, as agent(25)

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(k)(10)   Amendment No. 1 to the Amended and Restated Sale and Servicing Agreement, dated as of May 6, 2010, among Ares Capital CP Funding LLC, as borrower, Ares Capital Corporation, as servicer, Wells Fargo Bank, National Association, as successor by merger to Wachovia Bank, as note purchaser, U.S. Bank National Association, as trustee and collateral custodian, and Wells Fargo Securities, LLC, as agent(27)

(k)(11)

 

Amendment No. 2 to the Amended and Restated Sale and Servicing Agreement, dated as of January 18, 2011, among Ares Capital CP Funding LLC, as borrower, Ares Capital Corporation, as servicer, Wells Fargo Bank, National Association, as successor by merger to Wachovia Bank, as note purchaser, U.S. Bank National Association, as trustee and collateral custodian, and Wells Fargo Securities, LLC, as agent(28)

(k)(12)

 

Amendment No. 3 to the Amended and Restated Sale and Servicing Agreement, dated as of October 13, 2011, among Ares Capital CP Funding LLC, as borrower, Ares Capital Corporation, as servicer and as transferor, Wells Fargo Bank, National Association (as successor by merger to Wachovia Bank, National Association), as note purchaser, U.S. Bank National Association, as trustee, collateral custodian and bank, and Wells Fargo Securities, LLC, as agent(29)

(k)(13)

 

Amendment No. 4 to the Amended and Restated Sale and Servicing Agreement, dated as of January 18, 2012, among Ares Capital CP Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Wells Fargo Bank, National Association (as successor by merger to Wachovia Bank, National Association), as note purchaser, Wells Fargo Securities,  LLC, as agent, and U.S. Bank National Association, as collateral custodian, trustee and bank(30)

(k)(14)

 

Amendment No. 5 to the Amended and Restated Sale and Servicing Agreement, dated as of June 7, 2012, among Ares Capital CP Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Wells Fargo Bank, National Association (as successor by merger to Wachovia Bank, National Association), as note purchaser, Wells Fargo Securities,  LLC, as agent, and U.S. Bank National Association, as collateral custodian, trustee and bank(26)

(k)(15)

 

Amendment No. 6 to the Loan and Servicing Agreement, dated as of January 25, 2013, among Ares Capital CP Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Wells Fargo Securities, LLC, as agent, and Wells Fargo Bank, National Association, as swingline lender, and the other lenders party thereto(31)

(k)(16)

 

Amendment No. 8 to Loan and Servicing Agreement, dated as of January 3, 2017, among Ares Capital CP Funding LLC, Ares Capital Corporation, Wells Fargo Bank, National Association, as swingline lender, as a lender and as the successor agent, Wells Fargo Securities, LLC, as the resigning agent, Bank of America, N.A., as a lender and U.S. Bank National Association, as trustee, bank and collateral custodian(33)

(k)(17)

 

Amendment No. 10 to Loan and Servicing Agreement, dated as of October 2, 2018, among Ares Capital CP Funding LLC, Ares Capital Corporation, Wells Fargo Bank National Association, as the agent and Wells Fargo Bank, National Association, as a lender and Bank of America, N.A.(34)

(k)(18)

 

Amendment No. 11 to Loan and Servicing Agreement, dated as of December 14, 2018, among Ares Capital CP Funding LLC, Ares Capital Corporation, Wells Fargo Bank National Association, as the agent and Wells Fargo Bank, National Association, as a lender and Bank of America, N.A.(35)

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(k)(19)   Omnibus Amendment, dated as of May 14, 2014, among Ares Capital CP Funding LLC, Ares Capital CP Funding Holdings LLC, Ares Capital Corporation, Wells Fargo Bank, National Association, as swingline lender and as a lender, Wells Fargo Securities, LLC, as agent, and U.S. Bank National Association, as trustee, bank and collateral custodian (amending the Loan and Servicing Agreement, dated as of January 22, 2010, the Amended and Restated Purchase and Sale Agreement, dated as of January 22, 2010, and the Second Tier Purchase and Sale Agreement, dated as of January 22, 2010)(32)

(k)(20)

 

Tenth Amended and Restated Senior Secured Credit Agreement, dated as of April 1, 2019, among Ares Capital Corporation, the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent(36)

(k)(21)

 

Loan and Servicing Agreement, dated as of January 20, 2012, among Ares Capital JB Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Sumitomo Mitsui Banking Corporation, as administrative agent, collateral agent and lender, and U.S. Bank National Association, as collateral custodian and bank(37)

(k)(22)

 

Purchase and Sale Agreement, dated as of January 20, 2012, between Ares Capital JB Funding LLC, as purchaser, and Ares Capital Corporation, as seller(37)

(k)(23)

 

Omnibus Amendment No. 1, dated as of September 14, 2012, among Ares Capital JB Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Sumitomo Mitsui Banking Corporation, as administrative agent, lender and collateral agent, and U.S. Bank National Association, as collateral custodian and bank (amending the Loan and Servicing Agreement, dated as of January 20, 2012, and the Purchase and Sale Agreement, dated as of January 20, 2012)(38)

(k)(24)

 

Omnibus Amendment No. 2, dated as of December 20, 2013, among Ares Capital JB Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Sumitomo Mitsui Banking Corporation, as administrative agent, lender and collateral agent, and U.S. Bank National Association, as collateral custodian and bank (amending the Loan and Servicing Agreement, dated as of January 20, 2012, and the Purchase and Sale Agreement, dated as of January 20, 2012)(39)

(k)(25)

 

Omnibus Amendment No. 3, dated as of June 30, 2015, among Ares Capital JB Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Sumitomo Mitsui Banking Corporation, as administrative agent, lender and collateral agent, and U.S. Bank National Association, as collateral custodian and bank (amending the Loan and Servicing Agreement, dated as of January 20, 2012, and the Purchase and Sale Agreement, dated as of January 20, 2012)(40)

(k)(26)

 

Omnibus Amendment No. 4, dated as of August 24, 2017, among Ares Capital JB Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Sumitomo Mitsui Banking Corporation, as administrative agent, lender and collateral agent, and U.S. Bank National Association, as collateral custodian and bank (amending the Loan and Servicing Agreement, dated as of January 20, 2012)(41)

(k)(27)

 

Omnibus Amendment No. 5, dated as of September 12, 2018, among Ares Capital JB Funding LLC, as borrower, Ares Capital Corporation, as servicer and transferor, Sumitomo Mitsui Banking Corporation, as administrative agent, lender and collateral agent, and U.S. Bank National Association, as collateral custodian and bank (amending the Loan and Servicing Agreement, dated as of January 20, 2012)(42)

(l)(1)

 

Opinion and Consent of Venable LLP, Maryland counsel for Ares Capital Corporation*

(l)(2)

 

Opinion and Consent of Kirkland & Ellis LLP, counsel for Ares Capital Corporation*

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(m)   Not Applicable

(n)(1)

 

Consent of independent registered public accounting firm for Ares Capital Corporation*

(n)(2)

 

Report of independent registered public accounting firm for Ares Capital Corporation, regarding "senior securities" table contained herein(4)

(p)

 

Not Applicable

(q)

 

Not Applicable

(r)

 

Code of Ethics(23)

99.1

 

Form of Preliminary Prospectus Supplement For Common Stock Offerings(43)

99.2

 

Form of Preliminary Prospectus Supplement For Preferred Stock Offerings(43)

99.3

 

Form of Preliminary Prospectus Supplement For Debt Offerings(43)

99.4

 

Form of Preliminary Prospectus Supplement For Rights Offerings(43)

99.5

 

Form of Preliminary Prospectus Supplement For Warrant Offerings(43)

99.6

 

Form of Preliminary Prospectus Supplement For Unit Offerings(43)

99.7

 

Form of Preliminary Prospectus Supplement For Retail Notes Offerings(44)

99.8

 

Form of Preliminary Prospectus Supplement For Institutional Notes Offerings(44)

*
Filed herewith.

(1)
Incorporated by reference to Exhibit 3.1 to the Registrant's Form 10-K (File No. 814-00663) for the year ended December 31, 2016, filed on February 22, 2017.

(2)
Incorporated by reference to Exhibits 3.2 and 10.1, as applicable, to the Registrant's Form 10-K (File No. 814-00663) for the year ended December 31, 2018, filed on February 12, 2019.

(3)
Incorporated by reference to Exhibit (d) to the Registrant's pre-effective Amendment No. 2 to the Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-114656), filed on September 28, 2004.

(4)
Incorporated by reference to Exhibits (d)(2) and (n)(2), as applicable, to the Registrant's Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-230351), filed on March 18, 2019.

(5)
Incorporated by reference to Exhibit (d)(4) to the Registrant's pre-effective Amendment No. 2 to the Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-149139), filed on April 9, 2008.

(6)
Incorporated by reference to Exhibit d.2 to Allied Capital's Registration Statement under the Securities Act of 1933, as amended, on Form N 2/A (File No. 333-133755), filed on June 21, 2006.

(7)
Incorporated by reference to Exhibits d.8 and d.9, as applicable, to Allied Capital's post-effective Amendment No. 3 to the Registration Statement under the Securities Act of 1933, as amended, on Form N-2/A (File No. 333-133755), filed on March 28, 2007.

(8)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on April 7, 2010.

(9)
Incorporated by reference to Exhibit 4.1 to the Registrant's Form 8-K (File No. 814-00663), filed on October 22, 2010.

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(10)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on November 19, 2013.

(11)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on November 21, 2014.

(12)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on September 19, 2016.

(13)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on August 10, 2017.

(14)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on January 11, 2018.

(15)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on March 8, 2019.

(16)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on July 19, 2013.

(17)
Incorporated by reference to Exhibits 4.1 and 4.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on January 27, 2017.

(18)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on June 8, 2011.

(19)
Incorporated by reference to Exhibit 99.1 to the Registrant's Form 8-K (File No. 814-00663), filed on May 26, 2016.

(20)
Incorporated by reference to Exhibit (j) to the Registrant's pre-effective Amendment No. 1 to the Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-158211), filed on May 28, 2009.

(21)
Incorporated by reference to Exhibit 10.5 to the Registrant's Form 10-K (File No. 814-00663) for the year ended December 31, 2014, filed on February 26, 2015.

(22)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 10-Q (File No. 814-00663) for the quarter ended June 30, 2007, filed on August 9, 2007.

(23)
Incorporated by reference to Exhibit (k)(3) to the Registrant's pre-effective Amendment No. 1 to the Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-114656), filed on September 17, 2004.

(24)
Incorporated by reference to Exhibits (k)(3), (k)(4) and (r), as applicable, to the Registrant's Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-188175), filed on April 26, 2013.

(25)
Incorporated by reference to Exhibits 10.2 through 10.4, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on January 25, 2010.

(26)
Incorporated by reference to Exhibits 10.1 through 10.3, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on June 8, 2012.

(27)
Incorporated by reference to Exhibit 10.5 to the Registrant's Form 10-Q (File No. 814-00663) for the quarter ended March 31, 2010, filed on May 10, 2010.

(28)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on January 19, 2011.

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(29)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on October 14, 2011.

(30)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on January 19, 2012.

(31)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on January 28, 2013.

(32)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on May 15, 2014.

(33)
Incorporated by reference to Exhibits 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on January 4, 2017.

(34)
Incorporated by reference to Exhibit 10.2 to the Company's Form 8-K (File No. 814-00663), filed on October 3, 2018.

(35)
Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K (File No. 814-00663), filed on December 17, 2018.

(36)
Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K (File No. 814-00663), filed on April 2, 2019

(37)
Incorporated by reference to Exhibits 10.1 and 10.2, as applicable, to the Registrant's Form 8-K (File No. 814-00663), filed on January 24, 2012.

(38)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on September 17, 2012.

(39)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on December 23, 2013.

(40)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on July 1, 2015.

(41)
Incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K (File No. 814-00663), filed on August 28, 2017.

(42)
Incorporated by reference to Exhibit 10.1 to the Company's Form 8-K (File No. 814-00663), filed on September 13, 2018.

(43)
Incorporated by reference to Exhibits 99.2 through 99.7, as applicable, to the Registrant's pre-effective Amendment No. 1 to the Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-181563), filed on July 19, 2012.

(44)
Incorporated by reference to Exhibits 99.8 and 99.9, as applicable, to the Registrant's pre-effective Amendment No. 2 to the Registration Statement under the Securities Act of 1933, as amended, on Form N-2 (File No. 333-195748), filed on June 26, 2014.

ITEM 26.    MARKETING ARRANGEMENTS

        The information contained under the heading "Plan of Distribution" on this Registration Statement is incorporated herein by reference and any information concerning any underwriters for a particular offering will be contained in the prospectus supplement related to that offering.

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ITEM 27.    OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION

Commission registration fee

  $ 363,600 *

FINRA filing fee

  $ 225,500  

Accounting fees and expenses

  $ 80,000 (1)

Legal fees and expenses

  $ 350,000 (1)

Printing

  $ 75,000 (1)

Miscellaneous fees and expenses

  $ 25,000 (1)

Total

  $ 1,119,100 (1)

(1)
These amounts are estimates.

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ITEM 28.    PERSONS CONTROLLED BY OR UNDER COMMON CONTROL

Direct Subsidiaries

        The following list sets forth each of our subsidiaries, the state or country under whose laws the subsidiary is organized, and the percentage of voting securities or membership interests owned by us in such subsidiary:

A.C. Corporation (Delaware)

    100 %

AC Notes Holdings LLC (Delaware)

    100 %

ACAS, LLC (Delaware)

    100 %

ARCC AIP Holdings, LLC (Delaware)

    100 %

ARCC API Corp. (Delaware)

    100 %

ARCC Blocker Corp. (Delaware)

    100 %

ARCC C&C Holdco, LLC (Delaware)

    99.5 %

ARCC OTG Preferred Corp. (f/k/a ARCC CG Corp.) (Delaware)

    100 %

ARCC CLPB Corporation (Delaware)

    100 %

ARCC CP LLC (Delaware)

    100 %

ARCC Crescent LLC (Delaware)

    100 %

ARCC CR LLC (Delaware)

    100 %

ARCC ECG LLC (Delaware)

    100 %

ARCC ED Corp. (Delaware)

    100 %

ARCC EF Corp. (Delaware)

    100 %

ARCC FD Corp. (Delaware)

    100 %

ARCC FL Corp. (Delaware)

    100 %

ARCC FM Corp. (Delaware)

    100 %

ARCC GAC LLC (Delaware)

    100 %

ARCC HEELSTONE LLC (Delaware)

    100 %

ARCC GF1 Corp. (Delaware)

    100 %

ARCC H8 Corp. (Delaware)

    100 %

ARCC HS LLC (Delaware)

    100 %

ARCC Imperial Corporation (Delaware)

    100 %

ARCC Imperial POF LLC (f/k/a Amerex Equity LLC) (Delaware)

    100 %

ARCC Imperial LLC (Delaware)

    100 %

ARCC KPS Corp. (Delaware)

    100 %

ARCC LSQ LLC (Delaware)

    100 %

ARCC MCF I, LLC (f/k/a Dynamic Equity, LLC) (Delaware)

    100 %

ARCC MCF 2 LLC (Delaware)

    100 %

ARCC MH LLC (Delaware)

    100 %

ARCC NIP Holdings, LLC (Delaware)

    100 %

ARCC NR LLC (Delaware)

    100 %

ARCC NV1 Corp. (Delaware)

    100 %

ARCC NV2 Corp. (Delaware)

    100 %

ARCC OTG Corp. (Delaware)

    100 %

ARCC PCGI III AIV Blocker, Inc. (Delaware)

    100 %

ARCC PCP G.P., LLC (Delaware)

    100 %

ARCC PCP L.P. (Cayman Islands)

    100 %

ARCC PF LLC (Delaware)

    100 %

ARCC PH Corp. (Delaware)

    100 %

ARCC PJMB LLC (Delaware)

    100 %

ARCC PT Corp. (Delaware)

    100 %

ARCC PVA LLC (Delaware)

    100 %

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ARCC RB LLC (Delaware)

    100 %

ARCC RT LLC (Delaware)

    100 %

ARCC S2 LLC (f/k/a/ AC Postle, LLC) (Delaware)

    100 %

ARCC SC LLC (Delaware)

    100 %

ARCC SHC LLC (Delaware)

    100 %

ARCC SK Blocker Corp. (Delaware)

    100 %

ARCC TM CORP. (Delaware)

    100 %

ARCC UAS Corp. (Delaware)

    100 %

ARCC Universal Corp. (Delaware)

    100 %

ARCC Ultimus LLC (Delaware)

    100 %

ARCC VP LLC (Delaware)

    100 %

ARCC VS Corp. (Delaware)

    100 %

Ares Capital CP Funding Holdings LLC (Delaware)

    100 %

Ares Capital JB Funding LLC (Delaware)

    100 %

Ares Venture Finance GP LLC (Delaware)

    100 %

Ares Venture Finance, L.P. (Delaware)

    100 %

Calder Equity, LLC (Delaware)

    100 %

Crescent Equity Corp. (Delaware)

    86.26 %

GlobalCom Equity, LLC (Delaware)

    100 %

Ivy Hill Asset Management GP, LLC (Delaware)

    100 %

Multiad Equity Corp. (Delaware)

    86.26 %

S2 Equity Corp. (Delaware)

    86.26 %

Slate Equity, LLC (Delaware)

    100 %

Startec Equity, LLC (Delaware)

    100 %

Indirect Subsidiaries

        The following list sets forth each of our indirect subsidiaries, the state under whose laws the subsidiary is organized, and the percentage of voting securities or membership interests owned by the sole member of such subsidiary:

AC Corporate Holdings, Inc. (Delaware)

    100 %

ACAS CRE CDO 2007-1 Depositor, LLC (Delaware)

    100 %

ACAS CRE Services, LLC (Delaware)

    100 %

ACAS Real Estate Holdings Corporation (Delaware)

    100 %

ACE Acquisition Holdings, LLC (Delaware)

    100 %

Allied Crescent Equity, LLC (Delaware)

    100 %

American Capital Agent Services, LLC (Delaware)

    100 %

ARCC Beacon LLC

    100 %

Ares Capital CP Funding LLC (Delaware)

    100 %

Capital Placement Holdings, Inc. (Delaware)

    100 %

Crescent Sliver Equity LLC (Delaware)

    100 %

ECAS 2016 Ltd. (Guernsey)

    100 %

ECAS S.AR.L. (Luxembourg)

    100 %

ECAS II S.AR.L. (Luxembourg)

    100 %

European Capital Limited (Guernsey)

    100 %

European Capital S.A. Sicar (Luxembourg)

    100 %

HCI Equity, LLC (Illinois)

    100 %

PCP GHS Holdings Inc. (Delaware)

    100 %

        Each of our direct and indirect subsidiaries listed above is consolidated for financial reporting purposes.

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        In addition, we may be deemed to control certain portfolio companies. See "Portfolio Companies" in the Prospectus.

ITEM 29.    NUMBER OF HOLDERS OF SECURITIES

        The following table sets forth the approximate number of record holders of our common stock and each class of our senior securities (including bank loans) as of March 31, 2019.

TITLE OF CLASS
  NUMBER OF
RECORD HOLDERS
 

Common stock, $0.001 par value

    1,420 (including Cede & Co.)  

Revolving Credit Facility

    34  

Revolving Funding Facility

    2  

SMBC Funding Facility

    1  

2022 Convertible Notes

    47  

2024 Convertible Notes

    52  

2020 Notes

    57  

2022 Notes

    58  

2023 Notes

    64  

2025 Notes

    61  

2047 Notes

    71  

ITEM 30.    INDEMNIFICATION

        Maryland law permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages except for liability resulting from (1) actual receipt of an improper benefit or profit in money, property or services or (2) active and deliberate dishonesty established by a final adjudication as being material to the cause of action. Our charter contains such a provision which eliminates directors' and officers' liability to the maximum extent permitted by Maryland law, subject to the requirements of the Investment Company Act.

        Our charter authorizes us, to the maximum extent permitted by Maryland law and subject to the requirements of the Investment Company Act, to obligate us to indemnify any present or former director or officer or any individual who, while a director or officer and at our request, serves or has served another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee, from and against any claim or liability to which that person may become subject or which that person may incur by reason of his or her status as a present or former director or officer and to pay or reimburse their reasonable expenses in advance of final disposition of a proceeding. Our bylaws obligate us, to the maximum extent permitted by Maryland law and the Investment Company Act, to indemnify any present or former director or officer or any individual who, while a director or officer and at our request, serves or has served another corporation, real estate investment trust, partnership, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner or trustee and who is made or threatened to be made a party to a proceeding by reason of his or her service in that capacity from and against any claim or liability to which that person may become subject or which that person may incur by reason of his or her service in that capacity and to pay or reimburse their reasonable expenses in advance of final disposition of a proceeding. The charter and bylaws also permit us to, with the approval of the board of directors or a duly authorized committee thereof, indemnify and advance expenses to any person who served a predecessor of us in any of the capacities described above and any of our employees or agents or any employees or agents of our predecessor. In accordance with the Investment Company Act, we will not indemnify any person for any liability to which such person would be subject by reason of such person's willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the

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conduct of his or her office. In addition to the indemnification provided for in our bylaws, we have entered into indemnification agreements with each of our current directors and certain of our officers and with members of our investment adviser's investment committee and we intend to enter into indemnification agreements with each of our future directors, members of our investment adviser's investment committee and certain of our officers. The indemnification agreements attempt to provide these directors and senior officers the maximum indemnification permitted under Maryland law and the Investment Company Act. The agreements provide, among other things, for the advancement of expenses and indemnification for liabilities which such person may incur by reason of his or her status as a present or former director or officer or member of our investment adviser's investment committee in any action or proceeding arising out of the performance of such person's services as a present or former director or officer or member of our investment adviser's investment committee.

        Maryland law requires a corporation (unless its charter provides otherwise, which our charter does not) to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made or threatened to be made a party by reason of his or her service in that capacity. Maryland law permits a corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made or are threatened to be made a party by reason of their service in those or other capacities unless it is established that (a) the act or omission of the director or officer was material to the matter giving rise to the proceeding and (i) was committed in bad faith or (ii) was the result of active and deliberate dishonesty, (b) the director or officer actually received an improper personal benefit in money, property or services or (c) in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. In addition, Maryland law permits a corporation to advance reasonable expenses to a director or officer upon the corporation's receipt of (a) a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation and (b) a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the standard of conduct was not met.

        The investment advisory and management agreement provides that, absent willful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of the reckless disregard of its duties and obligations, our investment adviser Ares Capital Management and its officers, managers, agents, employees, controlling persons, members and any other person or entity affiliated with it are entitled to indemnification from us for any damages, liabilities, costs and expenses (including reasonable attorneys' fees and amounts reasonably paid in settlement) arising from the rendering of our investment adviser's services under the investment advisory and management agreement or otherwise as our investment adviser.

        The administration agreement provides that, absent willful misfeasance, bad faith or negligence in the performance of its duties or by reason of the reckless disregard of its duties and obligations, Ares Operations and its officers, manager, agents, employees, controlling persons, members and any other person or entity affiliated with it are entitled to indemnification from us for any damages, liabilities, costs and expenses (including reasonable attorneys' fees and amounts reasonably paid in settlement) arising from the rendering of Ares Operations' services under the administration agreement or otherwise as our administrator.

        Insofar as indemnification for liability arising under the Securities Act may be permitted to directors, officers and controlling persons of ours pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person of ours in the successful defense of any action, suit or

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proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

ITEM 31.    BUSINESS AND OTHER CONNECTIONS OF INVESTMENT ADVISER

        A description of any other business, profession, vocation or employment of a substantial nature in which Ares Capital Management, and each partner, director or executive officer of Ares Capital Management, is or has been, during the past two fiscal years, engaged in for his or her own account or in the capacity of director, officer, employee, partner or trustee, is set forth in Part A of this Registration Statement in the sections entitled "Management." Additional information regarding Ares Capital Management and its officers and directors are set forth in its Form ADV, as filed with the Securities and Exchange Commission (SEC File No. 801-63168), and is incorporated herein by reference.

ITEM 32.    LOCATION OF ACCOUNTS AND RECORDS

        All accounts, books and other documents required to be maintained by Section 31(a) of the Investment Company Act of 1940 and the rules thereunder are maintained at the offices of:

    (1)
    the Company, Ares Capital Corporation, 245 Park Avenue, 44th Floor, New York, New York 10167;

    (2)
    the transfer agent, Computershare Trust Company N.A., P.O. Box 505000, Louisville, KY 40233-5000;

    (3)
    the custodian, U.S. Bank National Association, Corporate Trust Services, One Federal Street, 3rd Floor, Boston, Massachusetts 02110; and

    (4)
    our investment adviser, Ares Capital Management LLC, 2000 Avenue of the Stars, 12th Floor, Los Angeles, California 90067.

ITEM 33.    MANAGEMENT SERVICES

        Not Applicable.

ITEM 34.    UNDERTAKINGS

        The Registrant undertakes:

    (1)
    to suspend the offering of shares until the prospectus is amended if (a) subsequent to the effective date of its registration statement, the net asset value declines more than ten percent from its net asset value as of the effective date of the registration statement or (b) the net asset value increases to an amount greater than the net proceeds as stated in the prospectus;

    (2)
    not applicable;

    (3)
    if the securities being registered are to be offered to existing stockholders pursuant to warrants or rights, and any securities not taken by stockholders are to be reoffered to the public, to supplement the prospectus, after the expiration of the subscription period, to set forth the results of the subscription offer, the transactions by underwriters during the subscription period, the amount of unsubscribed securities to be purchased by underwriters, and the terms of any subsequent reoffering thereof. If any public offering by the underwriters of the securities being registered is to be made on terms differing from those set forth on the

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      cover page of the prospectus, the Registrant shall undertake to file a post-effective amendment to set forth the terms of such offering;

    (4)
    (a) to file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

    (i)
    to include any prospectus required by Section 10(a)(3) of the Securities Act;

    (ii)
    to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b), or other applicable SEC rule under the Securities Act, if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; and

    (iii)
    to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;

    provided, however , that paragraphs (a)(i), (ii) and (iii) of this section do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference into the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b), or other applicable SEC rule under the Securities Act, that is part of the registration statement;

    (b)
    that, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering thereof;

    (c)
    to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering;

    (d)
    that, for the purpose of determining liability under the Securities Act to any purchaser, if the Registrant is relying on Rule 430B:

    (i)
    each prospectus filed by the Registrant pursuant to Rule 424(b)(3) or other applicable SEC rule under the Securities Act shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

    (ii)
    each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) or other applicable SEC rule under the Securities Act as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (x), or (xi) for the purpose of providing the information required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the

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        registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however , that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date;

    (e)
    that if the Registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) or Rule 497(b), (c), (d) or (e) under the Securities Act or other applicable SEC rule under the Securities Act, as applicable, as part of a registration statement relating to an offering, other than prospectuses relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A under the Securities Act, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness, provided, however , that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use;

    (f)
    that for the purpose of determining liability of the Registrant under the Securities Act to any purchaser in the initial distribution of securities, the undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to the purchaser:

    (i)
    any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 424 or 497 under the Securities Act;

    (ii)
    any free writing prospectus relating to the offering prepared by or on behalf of the undersigned Registrant or used or referred to by the undersigned Registrant;

    (iii)
    the portion of any other free writing prospectus or advertisement pursuant to Rule 482 under the Securities Act relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and

    (iv)
    any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser;

    (5)
    that for the purposes of determining any liability under the Securities Act:

    (a)
    the information omitted from the form of prospectus filed as part of a registration statement in reliance upon Rule 430A under the Securities Act or other applicable SEC rule under the Securities Act and contained in the form of prospectus filed by the Registrant under Rule 424(b)(1) or Rule 497(h) under the Securities Act shall be deemed to be part of the Registration Statement as of the time it was declared effective; and

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      (b)
      each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering thereof;

    (6)
    that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange Act that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and

    (7)
    insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

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SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused this Registration Statement on Form N-2 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, in the State of New York, on the 22nd day of May, 2019.

    ARES CAPITAL CORPORATION

 

 

By:

 

/s/ R. KIPP DEVEER

R. Kipp deVeer
Chief Executive Officer

        Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated. This document may be executed by the signatories hereto on any number of counterparts, all of which constitute one and the same instrument.

SIGNATURE
 
TITLE
 
DATE

 

 

 

 

 

 

 
/s/ R. KIPP DEVEER

R. Kipp deVeer
  Chief Executive Officer and Director (principal executive officer)   May 22, 2019

/s/ PENNI F. ROLL

Penni F. Roll

 

Chief Financial Officer (principal financial officer)

 

May 22, 2019

/s/ SCOTT C. LEM

Scott C. Lem

 

Chief Accounting Officer, Vice President and Treasurer (principal accounting officer)

 

May 22, 2019

*

Michael J Arougheti

 

Co-Chairman and Director

 

May 22, 2019

*

Steve Bartlett

 

Director

 

May 22, 2019

*

Ann Torre Bates

 

Director

 

May 22, 2019

*

Daniel G. Kelly, Jr.

 

Director

 

May 22, 2019

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SIGNATURE
 
TITLE
 
DATE

 

 

 

 

 

 

 
*

Steven B. McKeever
  Director   May 22, 2019

*

Robert L. Rosen

 

Director

 

May 22, 2019

*

Bennett Rosenthal

 

Co-Chairman and Director

 

May 22, 2019

*

Eric B. Siegel

 

Director

 

May 22, 2019

*By:

 

/s/ JOSHUA M. BLOOMSTEIN

Joshua M. Bloomstein
Attorney-in-fact

 

 

 

 

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Exhibit (g)(2)

 

FORM OF SECOND AMENDED AND RESTATED INVESTMENT ADVISORY AND
MANAGEMENT AGREEMENT
BETWEEN
ARES CAPITAL CORPORATION
AND
ARES CAPITAL MANAGEMENT LLC

 

Second Amended and Restated Agreement (this “ Agreement ”) effective as of June 6, 2019, between ARES CAPITAL CORPORATION, a Maryland corporation (the “ Corporation ”), and ARES CAPITAL MANAGEMENT LLC, a Delaware limited liability company (the “ Adviser ”).

 

WHEREAS, the Corporation is a closed-end management company that has elected to be treated as a business development company under the Investment Company Act of 1940, as amended (the “ Investment Company Act ”);

 

WHEREAS, the Adviser is an investment adviser that has registered under the Investment Advisers Act of 1940, as amended (the “ Advisers Act ”);

 

WHEREAS, on September 30, 2004, the Corporation and the Adviser entered into an Investment Advisory and Management Agreement, pursuant to which the Adviser agreed to furnish investment advisory services to the Corporation (the “ Initial Agreement ”);

 

WHEREAS, the Corporation and the Adviser, with the approval of the Corporation’s stockholders, agreed to amend and restate the Initial Agreement in its entirety on June 1, 2006 (as amended and restated, the “ Original Agreement ”);

 

WHEREAS, the Corporation and the Adviser, with the approval of the Corporation’s stockholders, agreed to amend and restate the Original Agreement in its entirety on June 6, 2011 (as amended and restated, the “ Restated Agreement ”); and

 

WHEREAS, the Corporation and the Adviser desire to amend and restate the Restated Agreement in its entirety.

 

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the parties hereby agree that the Restated Agreement is hereby further amended and restated in its entirety to read as follows (and that the Restated Agreement shall be of no further force and effect whatsoever after the date hereof):

 

1.              Duties of the Adviser .

 

(a)            The Corporation hereby employs the Adviser to act as the investment adviser to the Corporation and to manage the investment and reinvestment of the assets of the Corporation, subject to the supervision of the Board of Directors of the Corporation (the “ Board ”), for the period and upon the terms herein set forth, in accordance with,

 

(i)             the investment objectives, policies and restrictions that are determined by the Corporation’s Board of Directors from time to time and disclosed to the Adviser, which objectives, policies and restrictions, as of the date of effectiveness of this Agreement, shall be those set forth in the Corporation’s Annual Report on Form 10-K, filed with the Securities and Exchange Commission (the “ SEC ”) on February 12, 2019;

 


 

(ii)            the Investment Company Act and

 

(iii)           all other applicable federal and state laws, rules and regulations, and the Corporation’s charter and by-laws.

 

Without limiting the generality of the foregoing, the Adviser shall, during the term and subject to the provisions of this Agreement,

 

(i)             determine the composition of the portfolio of the Corporation, the nature and timing of the changes therein and the manner of implementing such changes;

 

(ii)            identify, evaluate and negotiate the structure of the investments made by the Corporation;

 

(iii)           close and monitor the Corporation’s investments;

 

(iv)           determine the securities and other assets that the Corporation will purchase, retain, or sell;

 

(v)            perform due diligence on prospective portfolio companies; and

 

(vi)           provide the Corporation with such other investment advisory, research and related services as the Corporation may, from time to time, reasonably require for the investment of its funds.

 

The Adviser shall have the power and authority on behalf of the Corporation to effectuate its investment decisions for the Corporation, including the execution and delivery of all documents relating to the Corporation’s investments and the placing of orders for other purchase or sale transactions on behalf of the Corporation.  In the event that the Corporation determines to incur debt financing, the Adviser will arrange for such financing on the Corporation’s behalf, subject to the oversight and approval of the Board.  If it is necessary for the Adviser to make investments on behalf of the Corporation through a special purpose vehicle, the Adviser shall have authority to create or arrange for the creation of such special purpose vehicle and to make such investments through such special purpose vehicle in accordance with the Investment Company Act.

 

(b)            The Adviser hereby accepts such employment and agrees during the term hereof to render the services described herein for the compensation provided herein.

 

(c)            Subject to the requirements of the Investment Company Act, the Adviser is hereby authorized to enter into one or more sub-advisory agreements with other investment advisers (each, a “ Sub-Adviser ”) pursuant to which the Adviser may obtain the services of the Sub-Adviser(s) to assist the Adviser in providing the investment advisory services required to be provided by the Adviser under Section 1(a)  hereof.  Specifically, the Adviser may retain a Sub-

 

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Adviser to recommend specific securities or other investments based upon the Corporation’s investment objectives and policies, and work, along with the Adviser, in structuring, negotiating, arranging or effecting the acquisition or disposition of such investments and monitoring investments on behalf of the Corporation, subject to the oversight of the Adviser and the Corporation.  The Adviser, and not the Corporation, shall be responsible for any compensation payable to any Sub-Adviser.  Any sub-advisory agreement entered into by the Adviser shall be in accordance with the requirements of the Investment Company Act and other applicable federal and state law.  Nothing in this subsection (c)  will obligate the Adviser to pay any expenses that are the expenses of the Corporation under Section 2 hereof.

 

(d)            The Adviser, and any Sub-Adviser, shall for all purposes herein provided each be deemed to be an independent contractor and, except as expressly provided or authorized herein, shall have no authority to act for or represent the Corporation in any way or otherwise be deemed an agent of the Corporation.

 

(e)            The Adviser shall keep and preserve for the period required by the Investment Company Act any books and records relevant to the provision of its investment advisory services to the Corporation and shall specifically maintain all books and records with respect to the Corporation’s portfolio transactions and shall render to the Board such periodic and special reports as the Board may reasonably request.  The Adviser agrees that all records that it maintains for the Corporation are the property of the Corporation and will surrender promptly to the Corporation any such records upon the Corporation’s request, provided that the Adviser may retain a copy of such records.

 

2.              Corporation’s Responsibilities and Expenses Payable by the Corporation .  All investment professionals of the Adviser and its staff, when and to the extent engaged in providing investment advisory services required to be provided by the Adviser under Section 1(a)  hereof, and the compensation and routine overhead expenses of such personnel allocable to such services, will be provided and paid for by the Adviser and not by the Corporation.  The Corporation will bear all costs and expenses of its operations and transactions, including those relating to:

 

·               organization;

 

·               calculating the Corporation’s net asset value (including the cost and expenses of any independent valuation firm);

 

·               expenses incurred by the Adviser payable to third parties, including agents, consultants or other advisors, in monitoring financial and legal affairs for the Corporation and in monitoring the Corporation’s investments (including the cost of consultants hired to develop information technology systems designed to monitor the Corporation’s investments) and performing due diligence on its prospective portfolio companies;

 

·               interest payable on debt, if any, incurred to finance the Corporation’s investments;

 

·               offerings of the Corporation’s common stock and other securities;

 

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·               investment advisory and management fees;

 

·               administration fees, if any, payable under the Amended and Restated Administration Agreement (the “ Administration Agreement ”) between the Corporation and Ares Operations LLC or any successor thereto (the “ Administrator ”), the Corporation’s administrator;

 

·               fees payable to third parties, including agents, consultants or other advisors, relating to, or associated with, evaluating and making investments (including payments to third party vendors for financial information services);

 

·               transfer agent and custodial fees;

 

·               federal and state registration fees;

 

·               all costs of registration and listing the Corporation’s shares on any securities exchange;

 

·               federal, state and local taxes;

 

·               independent directors’ fees and expenses;

 

·               costs of preparing and filing reports or other documents required by governmental bodies (including the SEC);

 

·               costs of any reports, proxy statements or other notices to stockholders, including printing costs;

 

·               the Corporation’s allocable portion of the fidelity bond, directors and officers/errors and omissions liability insurance, and any other insurance premiums;

 

·               direct costs and expenses of administration, including printing, mailing, long distance telephone, cellular phone and data service, copying, secretarial and other staff, independent auditors and outside legal costs; and

 

·               all other expenses incurred by the Corporation or the Administrator in connection with administering the Corporation’s business (including payments under the Administration Agreement between the Corporation and the Administrator based upon the Corporation’s allocable portion of the Administrator’s overhead in performing its obligations under the Administration Agreement, including rent and the allocable portion of the cost of the Corporation’s officers and their respective staffs (including travel expenses)).

 

3.              Compensation of the Adviser .  The Corporation agrees to pay, and the Adviser agrees to accept, as compensation for the services provided by the Adviser hereunder, a base management fee (“ Base Management Fee ”) and an incentive fee (“ Incentive Fee ”) as hereinafter set forth.  The Corporation shall make any payments due hereunder to the Adviser or to the

 

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Adviser’s designee as the Adviser may otherwise direct.  To the extent permitted by applicable law, the Adviser may elect, or the Corporation may adopt a deferred compensation plan pursuant to which the Adviser may elect, to defer all or a portion of its fees hereunder for a specified period of time.

 

(a)            The Base Management Fee shall be 1.50% per annum of the average value of the Corporation’s total assets (other than cash or cash equivalents but including assets purchased with borrowed funds) at the end of each of the two most recently completed calendar quarters; provided, however, the Base Management Fee shall be 1.00% per annum of the average value of the Corporation’s total assets (other than cash or cash equivalents but including assets purchased with borrowed funds) at the end of each of the two most recently completed calendar quarters that exceeds an amount equal to the product of (i) 200% and (ii) the Corporation’s net asset value at the end of the most recently completed calendar quarter.  The Base Management Fee will be payable quarterly in arrears and appropriately adjusted for any share issuances or repurchases during the current calendar quarter.  Base Management Fees for any partial month or quarter will be appropriately pro rated.

 

(b)            The Incentive Fee shall consist of two parts, as follows:

 

(i)             One part will be calculated and payable quarterly in arrears based on the Pre-Incentive Fee net investment income for the quarter.  “ Pre-Incentive Fee net investment income ” means interest income, dividend income and any other income (including any other fees (other than fees for providing managerial assistance), such as commitment, origination, structuring, diligence and consulting fees or other fees that the Corporation receives from portfolio companies) accrued by the Corporation during the calendar quarter, minus the Corporation’s operating expenses for the quarter (including the Base Management Fee, expenses payable under the Administration Agreement, and any interest expense and dividends paid on any issued and outstanding preferred stock, but excluding the Incentive Fee).

 

Pre-Incentive Fee net investment income includes, in the case of investments with a deferred interest feature (such as market discount, debt instruments with payment-in-kind interest, preferred stock with payment-in-kind dividends and zero coupon securities), accrued income that we have not yet received in cash.  Pre-Incentive Fee net investment income does not include any realized capital gains, realized and unrealized capital losses or unrealized capital appreciation or depreciation.

 

Pre-Incentive Fee net investment income, expressed as a rate of return on the value of the Corporation’s net assets (defined as total assets less indebtedness) at the end of the immediately preceding calendar quarter, will be compared to a “hurdle rate” of 1.75% per quarter (7% annualized).  The Corporation will pay the Adviser an Incentive Fee with respect to the Corporation’s Pre-Incentive Fee net investment income in each calendar quarter as follows:

 

(A)           no Incentive Fee in any calendar quarter in which the Corporation’s Pre-Incentive Fee net investment income does not exceed the hurdle rate;

 

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(B)           100% of the Corporation’s Pre-Incentive Fee net investment income with respect to that portion of such Pre-Incentive Fee net investment income, if any, that exceeds the hurdle rate but is less than 2.1875% in any calendar quarter (8.75% annualized); and

 

(C)           20% of the amount of the Corporation’s Pre-Incentive Fee net investment income, if any, that exceeds 2.1875% in any calendar quarter (8.75% annualized).

 

These calculations will be appropriately pro rated for any period of less than three months and adjusted for any share issuances or repurchases during the current quarter.

 

(ii)            The second part of the Incentive Fee (the “ Capital Gains Fee ”) will be determined and payable in arrears as of the end of each calendar year (or upon termination of this Agreement as set forth below), commencing with the calendar year ending on December 31, 2004, and is calculated at the end of each applicable year by subtracting (1) the sum of the Corporation’s cumulative aggregate realized capital losses and aggregate unrealized capital depreciation from (2) the Corporation’s cumulative aggregate realized capital gains, in each case calculated from October 8, 2004.  If such amount is positive at the end of such year, then the Capital Gains Fee for such year is equal to 20.0% of such amount, less the aggregate amount of Capital Gains Fees paid in all prior years.  If such amount is negative, then there is no Capital Gains Fee for such year.  If this Agreement shall terminate as of a date that is not a calendar year end, the termination date shall be treated as though it were a calendar year end for purposes of calculating and paying a Capital Gains Fee.  This amendment and restatement of the Restated Agreement shall not be treated as such a termination.

 

For purposes of this Section 3(b)(ii) :

 

The cumulative aggregate realized capital gains are calculated as the sum of the differences, if positive, between (a) the net sales price of each investment in the Corporation’s portfolio when sold and (b) the accreted or amortized cost basis of such investment.

 

The cumulative aggregate realized capital losses are calculated as the sum of the amounts by which (a) the net sales price of each investment in the Corporation’s portfolio when sold is less than (b) the accreted or amortized cost basis of such investment.

 

The aggregate unrealized capital depreciation is calculated as the sum of the differences, if negative, between (a) the valuation of each investment in the Corporation’s portfolio as of the applicable Capital Gains Fee calculation date and (b) the accreted or amortized cost basis of such investment.

 

Notwithstanding the foregoing, if the Corporation is required by United States generally accepted accounting principles (“ GAAP ”) to record an investment at its fair value as of the time of acquisition instead of at the actual amount paid for such investment (including, for example, as a result of the application of the acquisition method of accounting), then solely for the purposes of calculating the Capital Gains Fee, the “accreted or amortized cost basis” of an investment shall be an amount (the “ Contractual Cost Basis ”) equal to (1) (x) the actual amount paid by the Corporation for such investment plus (y) any amounts recorded in the Corporation’s financial statements as required by GAAP that are attributable to the accretion of such investment plus (z) any other adjustments made to the cost basis included in the Corporation’s financial statements,

 

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including payment-in-kind interest or additional amounts funded (net of repayments) minus (2) any amounts recorded in the Corporation’s financial statements as required by GAAP that are attributable to the amortization of such investment.  For the avoidance of doubt, the Contractual Cost Basis as determined pursuant to the foregoing sentence may be higher or lower than the fair value of such investment (as determined in accordance with GAAP) at the time of acquisition.  In connection with the foregoing, in the event investments are purchased in a single transaction or series of related transactions for an aggregate purchase price without the Corporation allocating such purchase price to specific investments, the Corporation may assign a Contractual Cost Basis to a specific investment equal to such investment’s Pro Rata Share of such aggregate purchase price paid. “ Pro Rata Share ” means the resulting percentage determined using the amount at which a specific investment acquired in a single transaction or series of related transactions is recorded in the Corporation’s financial statements at the time of acquisition according to GAAP divided by the total amount at which all investments acquired in the same transaction or series of related transactions are recorded in the Corporation’s financial statements at the time of acquisition according to GAAP.

 

(iii)           Payment of any Incentive Fee otherwise earned by the Adviser shall be deferred (“ Deferred Incentive Fees ”) if, during the most recent four full calendar quarter period ending on or prior to the date such payment is to be made, the sum of (a) the Corporation’s aggregate distributions to its stockholders and (b) the change in the Corporation’s net assets (before taking into account any incentive fees payable during that period) is less than 7.0% of the Corporation’s net assets at the beginning of such period.  These calculations will be appropriately adjusted for any share issuances or repurchases during the relevant period.  Any Deferred Incentive Fees shall be carried over for payment in subsequent calculation periods by the Corporation, to the extent such payment could be otherwise be made under this Agreement.

 

4.              Covenants of the Adviser .  The Adviser covenants that it is registered as an investment adviser under the Advisers Act.  The Adviser agrees that its activities will at all times be in compliance in all material respects with all applicable federal and state laws governing its operations and investments.

 

5.              Excess Brokerage Commissions .  The Adviser is hereby authorized, to the fullest extent now or hereafter permitted by law, to cause the Corporation to pay a member of a national securities exchange, broker or dealer an amount of commission for effecting a securities transaction in excess of the amount of commission another member of such exchange, broker or dealer would have charged for effecting that transaction, if the Adviser determines in good faith, taking into account such factors as price (including the applicable brokerage commission or dealer spread), size of order, difficulty of execution, and operational facilities of the firm and the firm’s risk and skill in positioning blocks of securities, that such amount of commission is reasonable in relation to the value of the brokerage and/or research services provided by such member, broker or dealer, viewed in terms of either that particular transaction or its overall responsibilities with respect to the Corporation’s portfolio, and constitutes the best net results for the Corporation.

 

6.              Limitations on the Employment of the Adviser .  The services of the Adviser to the Corporation are not exclusive, and the Adviser may engage in any other business or render similar or different services to others including, without limitation, the direct or indirect sponsorship or management of other investment based accounts or commingled pools of capital, however

 

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structured, having investment objectives similar to those of the Corporation, and nothing in this Agreement shall limit or restrict the right of any member, manager, partner, officer or employee of the Adviser to engage in any other business or to devote his or her time and attention in part to any other business, whether of a similar or dissimilar nature, or to receive any fees or compensation in connection therewith (including fees for serving as a director of, or providing consulting services to, one or more of the Corporation’s portfolio companies, subject to applicable law).  So long as this Agreement or any extension, renewal or amendment remains in effect, the Adviser shall be the only investment adviser for the Corporation, subject to the Adviser’s right to enter into sub-advisory agreements.  The Adviser assumes no responsibility under this Agreement other than to render the services called for hereunder.  It is understood that directors, officers, employees and stockholders of the Corporation are or may become interested in the Adviser and its affiliates, as directors, officers, employees, partners, stockholders, members, managers or otherwise, and that the Adviser and directors, officers, employees, partners, stockholders, members and managers of the Adviser and its affiliates are or may become similarly interested in the Corporation as stockholders or otherwise.

 

7.              Responsibility of Dual Directors, Officers and/or Employees .  If any person who is a member, manager, partner, officer or employee of the Adviser or the Administrator is or becomes a director, officer and/or employee of the Corporation and acts as such in any business of the Corporation, then such member, manager, partner, officer and/or employee of the Adviser or the Administrator shall be deemed to be acting in such capacity solely for the Corporation, and not as a member, manager, partner, officer or employee of the Adviser or the Administrator or under the control or direction of the Adviser or the Administrator, even if paid by the Adviser or the Administrator.

 

8.              Limitation of Liability of the Adviser; Indemnification .  The Adviser, its members and their respective officers, managers, partners, agents, employees, controlling persons, members and any other person affiliated with any of them (collectively, the “ Indemnified Parties ”), shall not be liable to the Corporation for any action taken or omitted to be taken by the Adviser in connection with the performance of any of its duties or obligations under this Agreement or otherwise as an investment adviser of the Corporation, except to the extent specified in Section 36(b) of the Investment Company Act concerning loss resulting from a breach of fiduciary duty (as the same is finally determined by judicial proceedings) with respect to the receipt of compensation for services.  The Corporation shall indemnify, defend and protect the Indemnified Parties (each of whom shall be deemed a third party beneficiary hereof) and hold them harmless from and against all damages, liabilities, costs and expenses (including reasonable attorneys’ fees and amounts reasonably paid in settlement) incurred by the Indemnified Parties in or by reason of any pending, threatened or completed action, suit, investigation or other proceeding (including an action or suit by or in the right of the Corporation or its security holders) arising out of or otherwise based upon the performance of any of the Adviser’s duties or obligations under this Agreement or otherwise as an investment adviser of the Corporation.  Notwithstanding the foregoing provisions of this Section 8 to the contrary, nothing contained herein shall protect or be deemed to protect the Indemnified Parties against or entitle or be deemed to entitle the Indemnified Parties to indemnification in respect of, any liability to the Corporation or its security holders to which the Indemnified Parties would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of any Indemnified Party’s duties or by reason of the reckless disregard of the Adviser’s duties and obligations under this Agreement (as the same shall be determined in accordance with the Investment Company Act and any interpretations or guidance by the SEC or its staff thereunder).

 

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9.              Duration and Termination of Agreement .  This Agreement shall remain in effect for one year after the date hereof, and thereafter shall continue automatically for successive annual periods, provided that such continuance is specifically approved at least annually by

 

(a)            the vote of the Board, or by the vote of stockholders holding a majority of the outstanding voting securities of the Corporation and

 

(b)            the vote of a majority of the Corporation’s Directors who are not parties to this Agreement or “interested persons” (as such term is defined in Section 2(a)(19) of the Investment Company Act) of any party to this Agreement, in accordance with the requirements of the Investment Company Act.

 

This Agreement may be terminated at any time, without the payment of any penalty, upon 60 days’ written notice, by the vote of stockholders holding a majority of the outstanding voting securities of the Corporation, or by the vote of the Corporation’s Directors or by the Adviser. This Agreement will automatically terminate in the event of its “assignment” (as such term is defined for purposes of Section 15(a)(4) of the Investment Company Act).  The provisions of Section 8 hereof shall remain in full force and effect, and the Adviser shall remain entitled to the benefits thereof, notwithstanding any termination of this Agreement.  Further, notwithstanding the termination or expiration of this Agreement as aforesaid, the Adviser shall be entitled to any amounts owed under Section 3 hereof through the date of termination or expiration and Section 8 hereof shall continue in full force and effect and apply to the Adviser and its representatives as and to the extent applicable.

 

10.           Amendments of this Agreement .  This Agreement may not be amended or modified except by an instrument in writing signed by all parties hereto, but the consent of the Corporation must be obtained in conformity with the requirements of the Investment Company Act.

 

11.           Governing Law .  This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, including without limitation Sections 5-1401 and 5-1402 of the New York General Obligations Law and New York Civil Practice Laws and Rules 327(b), and the applicable provisions of the Investment Company Act, if any.  To the extent that the applicable laws of the State of New York, or any of the provisions herein, conflict with the applicable provisions of the Investment Company Act, if any, the latter shall control.  The parties unconditionally and irrevocably consent to the exclusive jurisdiction of the courts located in the State of New York and waive any objection with respect thereto, for the purpose of any action, suit or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

 

12.           No Waiver .  The failure of either party to enforce at any time for any period the provisions of or any rights deriving from this Agreement shall not be construed to be a waiver of such provisions or rights or the right of such party thereafter to enforce such provisions, and no waiver shall be binding unless executed in writing by all parties hereto.

 

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13.           Severability .  If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any law or public policy, all other terms and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party.

 

14.           Headings .  The descriptive headings contained in this Agreement are for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement.

 

15.           Counterparts .  This Agreement may be executed in one or more counterparts, each of which when executed shall be deemed to be an original instrument and all of which taken together shall constitute one and the same agreement.

 

16.           Notices .  All notices, requests, claims, demands and other communications hereunder shall be in writing and shall be given or made (and shall be deemed to have been duly given or made upon receipt) by delivery in person, by overnight courier service (with signature required), by facsimile, or by registered or certified mail (postage prepaid, return receipt requested) to the respective parties at their respective principal executive office addresses.

 

17.           Entire Agreement .  This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and supersedes all prior agreements and undertakings (including the Restated Agreement), both written and oral, between the parties with respect to such subject matter.

 

18.           Certain Matters of Construction .

 

(a)            The words “hereof”, “herein”, “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular Section or provision of this Agreement, and reference to a particular Section hereof shall include all subsections thereof.

 

(b)            Definitions shall be equally applicable to both the singular and plural forms of the terms defined, and references to the masculine, feminine or neuter gender shall include each other gender.

 

(c)            The word “including” shall mean including without limitation.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on the date above written.

 

 

ARES CAPITAL CORPORATION

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

ARES CAPITAL MANAGEMENT LLC

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 




Exhibit (h)(1)

 

ARES CAPITAL CORPORATION
(a Maryland corporation)

 

· Shares of Common Stock (Par Value $0.001 Per Share)
· Shares of Preferred Stock (Par Value $ · Per Share)
and
· Warrants to Purchase Common Stock or Preferred Stock

 

PURCHASE AGREEMENT

 

[Date]

 

[Names of Underwriters]
[Address]

 

Ladies and Gentlemen:

 

Ares Capital Corporation, a Maryland corporation (the “Company”), confirms its agreement with [               ] (“[               ]”) and each of the other Underwriters named in Schedule A hereto (collectively, the “Underwriters”, which term shall also include any underwriter substituted as hereinafter provided in Section 10 hereof), for whom [               ] are acting as representatives (in such capacity, the “Representatives”) with respect to the issue and sale by the Company and the purchase by the Underwriters, acting severally and not jointly, of the respective numbers of shares of Common Stock, par value $0.001 per share (“Common Stock”), or Preferred Stock, par value $ · per share (“Preferred Stock”), or both, or Warrants (the “Warrants”) to purchase Common Stock or Preferred Stock, or both, of the Company set forth in said Schedule A, and with respect to the grant by the Company to the Underwriters, acting severally and not jointly, of the option described in Section 2(b) hereof to purchase additional Securities (as hereinafter defined) to cover overallotments, if any.  The Preferred Stock may be offered in the form of depositary shares (the “Depositary Shares”) represented by depositary receipts (the “Depositary Receipts”).  The Warrants will be issued under one or more warrant agreements (the warrant agreement relating to any issue of Warrants to be sold pursuant to this Agreement is referred to herein as the “Warrant Agreement”) between the Company and the Warrant Agent identified in such Warrant Agreement (the “Warrant Agent”).  The Common Stock and, if applicable, the Preferred Stock or the Warrants, together, if applicable, with the Depositary Shares and the Depositary Receipts are hereinafter referred to as the “Securities”.  The aforesaid Securities (the “Initial Securities”) to be purchased by the Underwriters and all or any part of the Securities subject to the option described in Section 2(b) hereof (the “Option Securities”) are hereinafter called, collectively, the “Underwritten Securities”; and “Warrant Securities” shall mean the Common Stock or Preferred Stock issuable upon exercise of Warrants.  The Common Stock, Preferred Stock and Warrants may be offered either together or separately.  Each issue of Preferred Stock may vary, as applicable, as to the specific number of shares, title, issuance price, any redemption or sinking fund requirements, any conversion provisions and any other variable terms as set forth in the applicable certificate of designation (each, a “Certificate of Designation”) relating to such Preferred Stock.  Each issue of Warrants may vary, as applicable, as to the title, specific number of shares of Common Stock or Preferred Stock receivable upon exercise, issuance price, exercise dates, exercise conditions and any other variable terms as set forth in the applicable Warrant Agreement relating to such Warrants.

 

The Company understands that the Underwriters propose to make a public offering of the Underwritten Securities as soon as the Representatives deem advisable after this Agreement has been executed and delivered.

 


 

The Company has filed with the Securities and Exchange Commission (the “Commission”) a shelf registration statement on Form N-2 (File No. 333- · ) covering the registration of the Underwritten Securities and certain of the Company’s other securities under the Securities Act of 1933, as amended (the “1933 Act”), which registration statement was declared effective on · by the Commission.  The Company has also filed with the Commission a preliminary prospectus supplement, dated · , which contains a base prospectus, dated · (collectively, the “preliminary prospectus”).  Promptly after execution and delivery of this Agreement, the Company will prepare and file a prospectus in accordance with the provisions of Rule 430C (“Rule 430C”) of the rules and regulations of the Commission under the 1933 Act (the “1933 Act Regulations”) and Rule 497 (“Rule 497”) of the 1933 Act Regulations.  The information included in such prospectus that was omitted from such registration statement at the time it became effective but that is deemed to be part of such registration statement pursuant to Rule 430C is referred to as “Rule 430C Information.”  Unless the context otherwise requires, such registration statement, including all documents filed as a part thereof, and including all post-effective amendments thereto filed on or prior to the date hereof and any Rule 430C Information contained in a prospectus subsequently filed with the Commission pursuant to Rule 497 under the 1933 Act and deemed to be part of the registration statement and also including any registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations (the “Rule 462(b) Registration Statement”), is herein called the “Registration Statement.”  The final prospectus in the form filed by the Company with the Commission pursuant to Rule 497 under the 1933 Act on or before the second business day after the date hereof (or such earlier time as may be required under the 1933 Act), which will include the base prospectus, dated · , together with a final prospectus supplement, is herein called the “Prospectus.”  For purposes of this Agreement, all references to the Registration Statement, any preliminary prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system (“EDGAR”).

 

A Form N-54A Notification of Election to be Subject to Sections 55 through 65 of the Investment Company Act of 1940 filed Pursuant to Section 54(a) of the Investment Company Act (File No. 814-00663) (the “Notification of Election”) was filed with the Commission on April 21, 2004 under the Investment Company Act of 1940, as amended, and the rules and regulations thereunder (collectively, the “1940 Act”).

 

The Company has entered into an Amended and Restated Investment Advisory and Management Agreement, dated as of June 6, 2011 (the “Investment Advisory Agreement”), with Ares Capital Management LLC, a Delaware limited liability company registered as an investment adviser (the “Adviser”), under the Investment Advisers Act of 1940, as amended, and the rules and regulations thereunder (collectively, the “Advisers Act”).

 

The Company has entered into an Amended and Restated Administration Agreement, dated as of June 1, 2007 (the “Administration Agreement”), with Ares Operations LLC, a Delaware limited liability company (the “Administrator”).

 

SECTION 1.          Representations and Warranties .

 

(a)            Representations and Warranties by the Company.   The Company represents and warrants to each Underwriter as of the date hereof, as of the Applicable Time referred to in Section 1(a)(i) hereof, as of the Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if any) referred to in Section 2(b) hereof, and agrees with each Underwriter, as follows:

 

(i)             Compliance with Registration Requirements .  The Company is eligible to use Form N-2.  The Registration Statement (and the Registration Statement as amended by any post-effective amendment if the Company shall have made any amendments thereto after the effective

 

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date of the Registration Statement) has become effective under the 1933 Act and no stop order suspending the effectiveness of the Registration Statement (and the Registration Statement as amended by any post-effective amendment if the Company shall have made any amendments thereto after the effective date of the Registration Statement) has been issued under the 1933 Act and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the Company, are contemplated by the Commission, and any request on the part of the Commission for additional information has been complied with.

 

At the respective times the Registration Statement and any post-effective amendments thereto became effective, at the Applicable Time and at the Closing Time (and, if any Option Securities are purchased, at each Date of Delivery), the Registration Statement complied and will comply in all material respects with the requirements of the 1933 Act, the 1933 Act Regulations and the 1940 Act and did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.  Neither the Prospectus nor any amendments or supplements thereto (including any prospectus wrapper), at the time the Prospectus or any such amendment or supplement was issued, and at the Closing Time (and, if any Option Securities are purchased, at each Date of Delivery), included or will include an untrue statement of a material fact or omitted or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

The Prospectus, each preliminary prospectus and the prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto complied when so filed in all material respects with the 1933 Act, the 1933 Act Regulations and the 1940 Act except for any corrections to any preliminary prospectus that are made in the Prospectus and each preliminary prospectus and the Prospectus delivered to the Underwriters for use in connection with this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

 

As of the Applicable Time, the preliminary prospectus supplement, dated · , together with the base prospectus, dated · , as filed with the Commission on · , and the information included on Schedule B hereto [(which information the Representatives have informed the Company is being conveyed orally by the Underwriters to prospective purchasers at or prior to the Underwriters’ confirmation of sales of Underwritten Securities in the offering)], all considered together (collectively, the “General Disclosure Package”), did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. As of the date hereof, as of the Applicable Time, and as of the Closing Time (and, if any Option Securities are purchased, at each Date of Delivery), the Marketing Materials (as defined below), together with the information contained in the General Disclosure Package, did not and will not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 

As used in this subsection and elsewhere in this Agreement, “Applicable Time” means · [a.m.][p.m.] (Eastern time) on · or such other time as agreed by the Company and the Representatives.

 

As used in this subsection and elsewhere in this Agreement, “Marketing Materials” means the materials, if any, set forth on Schedule D hereto.

 

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The representations and warranties in this subsection shall not apply to statements in or omissions from the Registration Statement (or any amendment thereto), including the Rule 430C information, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials made in reliance upon and in conformity with written information furnished to the Company by any Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C information, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials.

 

(ii)            Independent Accountants .  The accountants who certified the Company’s financial statements included in the Registration Statement, the General Disclosure Package and the Prospectus are independent public accountants as required by the 1933 Act, the 1933 Act Regulations and the Securities Exchange Act of 1934, as amended (the “1934 Act”).

 

(iii)           Financial Statements .  The financial statements included in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly in all material respects the financial position of the Company and its Subsidiaries (as defined below) at the dates indicated and the consolidated statement of operations, consolidated statement of stockholders’ equity and consolidated statement of cash flows of the Company and its Subsidiaries for the periods specified; there are no financial statements that are required to be included in the Registration Statement, the General Disclosure Package or the Prospectus that are not included as required; said financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“GAAP”) applied on a consistent basis throughout the periods involved.  The “Selected Condensed Consolidated Financial Data of Ares Capital” included in the Registration Statement, the General Disclosure Package and the Prospectus present fairly, in all material respects, the information shown therein as of the date presented and have been compiled on a basis consistent with that of the audited financial statements included in the Registration Statement, the General Disclosure Package and the Prospectus.  The financial data set forth in the General Disclosure Package and in the Prospectus under the caption “Capitalization” fairly presents the information set forth therein on a basis consistent with that of the audited financial statements and related notes thereto contained in the Registration Statement.  There is no pro forma financial information that is required to be included in the Registration Statement, the General Disclosure Package and the Prospectus that is not included as required.

 

(iv)           No Material Adverse Change in Business .  Since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package and the Prospectus, except as otherwise stated therein, (A) there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its Subsidiaries (as defined below) considered as one enterprise, whether or not arising in the ordinary course of business (a “Material Adverse Effect”), (B) there have been no transactions entered into by the Company or its Subsidiaries, other than those in the ordinary course of business, which are material with respect to the Company and its Subsidiaries considered as one enterprise, and (C)  there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock.

 

(v)            Good Standing of the Company .  The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Maryland and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement, the Investment Advisory Agreement and the Administration

 

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Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.

 

(vi)           Subsidiaries .  The Company’s only subsidiaries that are consolidated with the Company for financial reporting purposes under GAAP are those listed on Schedule C hereto (each, a “Subsidiary” and collectively, the “Subsidiaries”). Each of the Subsidiaries has been duly organized and is validly existing as a corporation, limited liability company or limited partnership in good standing under the laws of the jurisdiction of its organization, has power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and is duly qualified as a foreign corporation, limited liability company or limited partnership to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to be so qualified or to be in good standing would not reasonably be expected to result in a Material Adverse Effect; except as otherwise disclosed in the Registration Statement, all of the issued and outstanding capital stock of each such Subsidiary has been duly authorized and validly issued and is fully paid and non-assessable; none of the outstanding shares of capital stock of any of the Subsidiaries was issued in violation of the preemptive or other similar rights of any securityholder of such Subsidiary. Except (A) as set forth in the Registration Statement, the General Disclosure Package and the Prospectus, and (B) portfolio investments made after [ · ], the Company does not own, directly or indirectly, any shares of stock or any other equity or debt securities of any corporation or have any equity or debt interest in any firm, partnership, joint venture, association or other entity that is not a Subsidiary.

 

(vii)          Capitalization .  The authorized, issued and outstanding capital stock of the Company is as set forth in the General Disclosure Package and the Prospectus [(as modified by any footnotes therein)] under the caption “Capitalization” (except for subsequent issuances, if any, pursuant to this Agreement, pursuant to the Company’s Dividend Reinvestment Plan or pursuant to reservations, agreements or employee benefit plans, if any, referred to in the General Disclosure Package or in the Prospectus or pursuant to the exercise of convertible securities or options, if any, referred to in the General Disclosure Package or the Prospectus).  The shares of issued and outstanding capital stock of the Company have been duly authorized and validly issued and are fully paid and non-assessable; none of the outstanding shares of capital stock of the Company was issued in violation of preemptive or other similar rights of any securityholder of the Company.

 

(viii)         Authorization of Agreements .

 

(A)           This Agreement, the Investment Advisory Agreement and the Administration Agreement have each been duly authorized, executed and delivered by the Company.  The Investment Advisory Agreement and the Administration Agreement are valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

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(B)           If applicable, the Warrant Agreement will have been duly authorized, executed and delivered by the Company prior to the issuance of any applicable Warrants and, when executed and delivered by the Warrant Agent, will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(C)           If applicable, the Deposit Agreement (as defined below) will have been duly authorized, executed and delivered by the Company prior to the issuance of any applicable Underwritten Securities and, when executed by the Depositary (as defined below), and will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(ix)           Authorization and Description of Underwritten Securities .  (A)  The Underwritten Securities being sold pursuant to this Agreement, if applicable, the Warrant Securities issuable upon exercise of the Warrants and, if applicable, the deposit of the Preferred Stock comprising part or all of the Underwritten Securities by or on behalf of the Company in accordance with the provisions of a deposit agreement (each, a “Deposit Agreement”), among the Company, the financial institution named in the Deposit Agreement (the “Depositary”) and the holders of the Depositary Receipts issued thereunder, have been duly authorized by the Company, and such Underwritten Securities have been duly authorized for issuance and sale to the Underwriters pursuant to this Agreement and, if applicable, the Warrant Agreement (or will have been so authorized prior to each issuance of Underwritten Securities) and, when issued and delivered by the Company pursuant to the provisions of this Agreement and, if applicable, the Warrant Agreement against payment of the consideration set forth in this Agreement and, if applicable, the Warrant Agreement, will be validly issued and fully paid and non-assessable; the Warrant Securities are enforceable against the Company in accordance with their terms, except as the enforcement thereof may be subject to the effect of (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought; the Underwritten Securities being sold pursuant to this Agreement and, if applicable, the Warrant Securities issuable upon exercise of the Warrants and the Depositary Receipts, conform in all material respects to the statements relating thereto contained in the General Disclosure Package and the Prospectus; and the issuance of the Underwritten Securities is not subject to preemptive or other similar rights of any securityholder of the Company.

 

(B)           If the Underwritten Securities are Common Stock or Preferred Stock convertible into Common Stock, the shares of issued and outstanding capital stock have been duly authorized and validly issued and are fully paid and non-assessable and such capital stock conforms in all material respects as to legal matters to the description thereof in the Prospectus.

 

(C)           If applicable, the shares of Common Stock issuable upon conversion of any issue of the Preferred Stock will have been duly authorized and reserved for issuance upon such conversion by all necessary corporate action and, when issued upon such conversion, will be validly issued, fully paid and non-assessable, and the issuance of such shares upon such conversion will not be subject to preemptive rights.

 

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(D)           If applicable, the Warrant Securities issuable upon exercise of the Warrants will have been duly authorized and reserved for issuance upon such exercise by all necessary corporate action and, when issued upon such exercise, will be validly issued, fully paid and non-assessable, and the issuance of such shares upon such exercise will not be subject to preemptive rights.

 

(E)            If applicable, upon execution and delivery thereof pursuant to the terms of the Deposit Agreement, the persons in whose names the Depositary Receipts are registered will be entitled to the rights specified therein and in the Deposit Agreement, except as the enforcement thereof may be subject to the effect of (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(x)            Absence of Defaults and Conflicts .  Neither the Company nor any of the Subsidiaries is in violation of its charter, by-laws or other organizational documents.  Further, neither the Company nor any of the Subsidiaries is in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or any of the Subsidiaries is a party or by which any of them may be bound, or to which any of the property or assets of the Company or any of the Subsidiaries is subject (collectively, “Agreements and Instruments”) except for such defaults that would not result in a Material Adverse Effect; and the execution, delivery and performance of this Agreement, the Deposit Agreement, the Warrant Agreement, if applicable, the Investment Advisory Agreement and the Administration Agreement and the consummation of the transactions contemplated herein and therein and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities and the use of the proceeds from the sale of the Securities as described in the General Disclosure Package and the Prospectus under the caption “Use of Proceeds”) and compliance by the Company with its obligations hereunder and thereunder do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of the Subsidiaries pursuant to, the Agreements and Instruments, except for such conflicts, breaches, defaults or Repayment Events that would not result in a Material Adverse Effect, nor will such action result in any violation of the provisions of the charter, by-laws or other organizational documents of the Company or any of the Subsidiaries or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Company or any of the Subsidiaries or any of their assets, properties or operations.  As used herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of the Subsidiaries.

 

(xi)           Absence of Proceedings .  Other than as disclosed in the General Disclosure Package, there is no action, suit or proceeding or, to the knowledge of the Company, inquiry or investigation, before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting the Company or any of the Subsidiaries, which is required to be disclosed in the General Disclosure Package, or which would result in a Material Adverse Effect, or which would materially and adversely affect the properties or assets thereof or the consummation of the transactions

 

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contemplated in this Agreement, the Deposit Agreement, the Warrant Agreement, if applicable, the Investment Advisory Agreement or the Administration Agreement or the performance by the Company of its obligations hereunder or thereunder; the aggregate of all pending legal or governmental proceedings to which the Company or any of the Subsidiaries is a party or of which any of their respective property or assets is the subject which are not described in the General Disclosure Package, including ordinary routine litigation incidental to the business, would not result in a Material Adverse Effect.

 

(xii)          Accuracy of Exhibits .  There are no contracts or documents which are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits thereto which have not been so described and filed as required.

 

(xiii)         Possession of Intellectual Property .  The Company and the Subsidiaries own or possess, or can acquire on reasonable terms, adequate patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property (collectively, “Intellectual Property”) necessary to carry on the business now operated by them or proposed to be operated by them immediately following the offering of the Underwritten Securities as described in the General Disclosure Package and the Prospectus, except where the failure to own or possess or otherwise be able to acquire such rights in a timely manner would not otherwise reasonably be expected to result in a Material Adverse Effect, and neither the Company nor any of the Subsidiaries has received any notice of or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which would render any Intellectual Property invalid or inadequate to protect the interest of the Company or any of the Subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.

 

(xiv)         Absence of Further Requirements .  No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Company of its obligations hereunder, in connection with the offering, issuance or sale of the Underwritten Securities hereunder [and, if applicable, the issuance of shares of Common Stock upon conversion of the Preferred Stock] or the consummation of the transactions contemplated by this Agreement, the Deposit Agreement, the Warrant Agreement, if applicable, the Investment Advisory Agreement, the Administration Agreement, the General Disclosure Package or the Prospectus (including the use of the proceeds from the sale of the Underwritten Securities as described in the General Disclosure Package and the Prospectus under the caption “Use of Proceeds”), except (A) such as have been already obtained under the 1933 Act, the 1933 Act Regulations or the 1940 Act, (B) such as may be required under state securities laws, and (C) the filing of the Notification of Election under the 1940 Act, which has been effected.

 

(xv)          Absence of Manipulation .  Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate take, directly or indirectly, any action which is designed to or which has constituted or which would be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Underwritten Securities in violation of any law, statute, regulation or rule applicable to the Company or its affiliates.

 

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(xvi)         Possession of Licenses and Permits .  The Company and the Subsidiaries possess such permits, licenses, approvals, consents and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them or proposed to be operated by them immediately following the offering of the Underwritten Securities as described in the General Disclosure Package and the Prospectus, except where the failure so to possess would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; the Company and the Subsidiaries are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; and neither the Company nor any of the Subsidiaries has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

 

(xvii)        Investment Company Act .  The Company is not required, and upon the issuance and sale of the Underwritten Securities as herein contemplated and the application of the net proceeds therefrom as described in the Prospectus will not be required, to register as a “registered management investment company” under the 1940 Act.

 

(xviii)       Registration Rights .  There are no persons with registration rights or other similar rights to have any securities registered pursuant to the Registration Statement or otherwise registered by the Company under the 1933 Act.

 

(xix)         Related Party Transactions .  There are no business relationships or related party transactions involving the Company, any of the Subsidiaries or any other person required to be described in the Prospectus which have not been described as required.

 

(xx)          Notification of Election .  When the Notification of Election was filed with the Commission, it (A) contained all statements required to be stated therein in accordance with, and complied in all material respects with the requirements of, the 1940 Act and (B) did not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

(xxi)         Investment Advisory Agreement .  (A) The terms of the Investment Advisory Agreement, including compensation terms, comply in all material respects with all applicable provisions of the 1940 Act and the Advisers Act and (B) the approvals by the board of directors and the stockholders of the Company of the Investment Advisory Agreement have been made in accordance with the requirements of Section 15 of the 1940 Act applicable to companies that have elected to be regulated as business development companies under the 1940 Act.

 

(xxii)        Interested Persons .  Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus (A) no person is serving or acting as an officer, director or investment adviser of the Company, except in accordance with the provisions of the 1940 Act and the Advisers Act, and (B) to the knowledge of the Company, no director of the Company is an “interested person” (as defined in the 1940 Act) of the Company or an “affiliated person” (as defined in the 1940 Act) of any of the Underwriters.

 

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(xxiii)       Business Development Company .  (A) The Company has duly elected to be treated by the Commission under the 1940 Act as a business development company, such election is effective and all required action has been taken by the Company under the 1933 Act and the 1940 Act to make the public offering and consummate the sale of the Underwritten Securities as provided in this Agreement; (B) the provisions of the corporate charter and by-laws of the Company, and the investment objectives, policies and restrictions described in the General Disclosure Package and the Prospectus, assuming they are implemented as described, will comply in all material respects with the requirements of the 1940 Act; and (C) the operations of the Company are in compliance in all material respects with the provisions of the 1940 Act applicable to business development companies.

 

(xxiv)      Employees and Executives .  The Company is not aware that (A) any executive, key employee or significant group of employees of the Company, any of the Subsidiaries, the Adviser or the Administrator plans to terminate employment with the Company, any of the Subsidiaries, the Adviser or the Administrator or (B) any such executive or key employee is subject to any noncompete, nondisclosure, confidentiality, employment, consulting or similar arrangement that would be violated by the present or proposed business activities of the Company, any of the Subsidiaries, the Adviser or the Administrator except where such termination or violation would not reasonably be expected to have a Material Adverse Effect.

 

(xxv)       No Extension of Credit .  The Company has not, directly or indirectly, including through a Subsidiary, extended credit, arranged to extend credit, or renewed any extension of credit, in the form of a personal loan, to or for any director or executive officer of the Company.

 

(xxvi)      Accounting Controls .  The Company has established and maintains an effective system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; and (C) access to assets is permitted only in accordance with management’s authorization.

 

(xxvii)     Disclosure Controls .  The Company has established and employs effective disclosure controls and procedures that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including its principal executive officer or officers and principal financial officer or officers, as appropriate to allow timely decisions regarding disclosure.

 

(xxviii)    Tax Returns .  The Company and the Subsidiaries have filed all federal, state, local and foreign tax returns that are required to have been filed by them pursuant to applicable foreign, federal, state, local or other law or have duly requested extensions thereof, except insofar as the failure to file such returns or request such extensions would not reasonably be expected to result in a Material Adverse Effect, and have paid all taxes shown as due pursuant to such returns or pursuant to any assessment received by the Company and the Subsidiaries, except for such taxes or assessments, if any, as are being contested in good faith and as to which adequate reserves have been provided or where the failure to pay would not reasonably be expected to result in a Material Adverse Effect.

 

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(xxix)      No Unlawful Payments .  Neither the Company nor the Subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of the Subsidiaries has (A) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity, (B) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds, (C) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended; or (D) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

 

(xxx)       Compliance with Anti-Money Laundering Laws .  The operations of the Company and the Subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended (the “CFTRA”), and the applicable money laundering statutes of all other jurisdictions having jurisdiction over the Company or any of the Subsidiaries, the applicable rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any other governmental agency having jurisdiction over the Company or any of the Subsidiaries (collectively, the “Other Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of the Subsidiaries with respect to the CFTRA or Other Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

(xxxi)      No Conflicts with Sanctions Laws .  None of the Company, the Subsidiaries or, to the knowledge of the Company, any of their respective directors, officers, agents, employees or affiliates is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the United Nations Security Council, the European Union or Her Majesty’s Treasury (collectively, “Sanctions”); and the Company will not, directly or indirectly, use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund any activities of or business with any person that, at the time of such funding, is the subject of Sanctions, (ii) to fund any activities of or business in Cuba, Iran, North Korea, Sudan, Syria or the Crimea region of Ukraine or (iii) in any other manner that will result in a violation by any person of Sanctions.

 

(xxxii)     Sarbanes-Oxley Act .  Except as disclosed in the General Disclosure Package, the Company is, and to the knowledge of the Company, the Company’s directors and officers, in their capacities as such, are, in compliance in all material respects with any applicable provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications.

 

(xxxiii)    Cybersecurity . (A) The Company is not aware of any security breach or incident, unauthorized access or disclosure, or other compromise relating to the Adviser’s information technology and computer systems, data and databases used by the Company (collectively, “IT Systems and Data”) except in each case as would not reasonably expected to, individually or in the aggregate, have a Material Adverse Effect, and (B) to the Company’s knowledge, the Adviser has implemented appropriate controls, policies, procedures, and technological safeguards to maintain and protect the integrity, continuous operation, redundancy and security of its IT Systems and Data reasonably consistent with in all material respects with industry standards and practices, or as required by applicable regulatory standards. To the Company’s knowledge, the Adviser is presently in material compliance with all applicable laws and regulations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification.

 

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(b)            Representations and Warranties of the Adviser and the Administrator .  The Adviser and the Administrator, jointly and severally, represent to each Underwriter as of the date hereof, as of the Applicable Time, as of the Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if any) referred to in Section 2(b) hereof, and agree with each Underwriter as follows:

 

(i)             No Material Adverse Change in Business .  Since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package and the Prospectus, except as otherwise stated therein, there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs, business prospects or regulatory status of the Adviser or the Administrator, whether or not arising in the ordinary course of business, that would reasonably be expected to result in a Material Adverse Effect.

 

(ii)            Good Standing .  Each of the Adviser and the Administrator has been duly organized and is validly existing as a limited liability company in good standing under the laws of the State of Delaware, and has limited liability company power and authority to own, lease and operate its properties and to conduct its business as described in the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement; the Adviser has limited liability company power and authority to execute and deliver and perform its obligations under the Investment Advisory Agreement; the Administrator has limited liability company power and authority to enter into and perform its obligations under the Administration Agreement; and each of the Adviser and the Administrator is duly qualified to transact business as a foreign entity and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of ownership or leasing of its property or the conduct of business, except where the failure to qualify or be in good standing would not otherwise reasonably be expected to result in a Material Adverse Effect.

 

(iii)           Registration Under Advisers Act .  The Adviser is duly registered with the Commission as an investment adviser under the Advisers Act and is not prohibited by the Advisers Act or the 1940 Act from acting under the Investment Advisory Agreement for the Company as contemplated by the General Disclosure Package and the Prospectus. There does not exist any proceeding or, to the Adviser’s knowledge, any facts or circumstances the existence of which could lead to any proceeding which might adversely affect the registration of the Adviser with the Commission.

 

(iv)           Absence of Proceedings .  There is no action, suit or proceeding or, to the knowledge of the Adviser or the Administrator, inquiry or investigation before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Adviser or the Administrator, threatened, against or affecting either the Adviser or the Administrator, which is required to be disclosed in the General Disclosure Package (other than as disclosed therein), or which would reasonably be expected to result in a Material Adverse Effect, or which would reasonably be expected to materially and adversely affect the consummation of the transactions contemplated in this Agreement, the Investment Advisory Agreement or the Administration Agreement; the aggregate of all pending legal or governmental proceedings to which the Adviser or the Administrator is a party or of which any of their respective property or assets is the subject which are not described in the General Disclosure Package, including ordinary routine litigation incidental to their business, would not reasonably be expected to result in a Material Adverse Effect.

 

(v)            Absence of Defaults and Conflicts .  Neither the Adviser nor the Administrator is in violation of its limited liability company operating agreement or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract,

 

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indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Adviser or the Administrator is a party or by which it or any of them may be bound, or to which any of the property or assets of the Adviser or the Administrator is subject (collectively, the “Adviser/Administrator Agreements and Instruments”), or in violation of any law, statute, rule, regulation, judgment, order or decree except for such violations or defaults that would not reasonably be expected to result in a Material Adverse Effect; and the execution, delivery and performance of this Agreement, the Investment Advisory Agreement and the Administration Agreement and the consummation of the transactions contemplated herein and therein and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Underwritten Securities [and, if applicable, the issuance of shares of Common Stock upon conversion of the Preferred Stock] and the use of the proceeds from the sale of the Underwritten Securities as described in the General Disclosure Package and the Prospectus under the caption “Use of Proceeds”) and compliance by the Adviser and the Administrator with their respective obligations hereunder and under the Investment Advisory Agreement and the Administration Agreement do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Adviser or the Administrator pursuant to, the Adviser/Administrator Agreements and Instruments except for such violations or defaults that would not reasonably be expected to result in a Material Adverse Effect, nor will such action result in any violation of the provisions of the limited liability company operating agreement of the Adviser or Administrator, respectively, or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Adviser or the Administrator or any of their assets, properties or operations.

 

(vi)           Authorization of Agreements .  This Agreement, the Investment Advisory Agreement and the Administration Agreement have been duly authorized, executed and delivered by the Adviser and the Administrator, as applicable.  This Agreement, the Investment Advisory Agreement and the Administration Agreement are valid and binding obligations of the Adviser or the Administrator, as applicable, enforceable against them in accordance with their terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(vii)          Absence of Further Requirements .  No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Adviser or the Administrator of their obligations hereunder, in connection with the offering, issuance or sale of the Underwritten Securities hereunder [and, if applicable, the issuance of shares of Common Stock upon conversion of the Preferred Stock] or the consummation of the transactions contemplated by this Agreement, the Investment Advisory Agreement, the Administration Agreement, the General Disclosure Package or the Prospectus (including the use of the proceeds from the sale of the Underwritten Securities as described in the General Disclosure Package and the Prospectus under the caption “Use of Proceeds”), except (A) such as have been already obtained under the 1933 Act, the 1933 Act Regulations or the 1940 Act, (B) such as may be required under state securities laws and (C) the filing of the Notification of Election under the 1940 Act, which has been effected.

 

(viii)         Description of Adviser and Administrator . The description of the Adviser and the Administrator contained in the General Disclosure Package and the Prospectus does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.

 

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(ix)           Possession of Licenses and Permits .  The Adviser and the Administrator possess such Governmental Licenses issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them, except where the failure so to possess would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; the Adviser and the Administrator are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not, singly or in the aggregate, result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, result in a Material Adverse Effect; and neither the Adviser nor the Administrator has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

 

(x)            Stabilization and Manipulation . Neither the Adviser, the Administrator nor any of their respective partners, officers, affiliates or controlling persons has taken, directly or indirectly, any action designed, under the 1934 Act, to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale of the Underwritten Securities in violation of any law, statute, regulation or rule applicable to the Adviser, the Administrator or any of their respective partners, officers, affiliates or controlling persons.

 

(xi)           Employment Status . The Adviser is not aware that (A) any executive, key employee or significant group of employees of the Company, if any, any of the Subsidiaries, the Adviser or the Administrator, as applicable, plans to terminate employment with the Company, any of the Subsidiaries, the Adviser or the Administrator or (B) any such executive or key employee is subject to any noncompete, nondisclosure, confidentiality, employment, consulting or similar agreement that would be violated by the present or proposed business activities of the Company, the Subsidiaries or the Adviser except where such termination or violation would not reasonably be expected to have a Material Adverse Effect.

 

(xii)          Internal Controls .  The Adviser is using its commercially reasonable efforts to operate a system of internal controls sufficient to provide reasonable assurance that (A) transactions effectuated by it under the Investment Advisory Agreement are executed in accordance with its management’s general or specific authorization; and (B) access to the Company’s assets that are in its possession or control is permitted only in accordance with its management’s general or specific authorization.

 

(xiii)         Accounting Controls .  The Administrator is using its commercially reasonable efforts to operate a system of internal accounting controls sufficient to provide reasonable assurance that (A) transactions for which it has bookkeeping and record keeping responsibility for under the Administration Agreement are recorded as necessary to permit preparation of the Company’s financial statements in conformity with GAAP and to maintain financial statements in conformity with GAAP and to maintain accountability for the Company’s assets and (B) the recorded accountability for such assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

 

(c)            Officer’s Certificates.   Any certificate signed by any officer of the Company, any of the Subsidiaries, the Adviser or the Administrator delivered to the Representatives or to counsel for the Underwriters shall be deemed a representation and warranty by the Company, such Subsidiary, the Adviser and/or the Administrator, as applicable, to each Underwriter as to the matters covered thereby.

 

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SECTION 2.          Sale and Delivery to Underwriters; Closing .

 

(a)            Initial Securities.   On the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from the Company, at the price per share set forth in Schedule B, the number of Initial Securities set forth in Schedule A opposite the name of such Underwriter, plus any additional number of Initial Securities which such Underwriter may become obligated to purchase pursuant to the provisions of Section 10 hereof.

 

(b)            Option Securities.   In addition, on the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company hereby grants an option to the Underwriters, severally and not jointly, to purchase up to an additional · Securities at the price per share set forth in Schedule B, less an amount per share equal to any dividends or distributions declared by the Company and payable on the Initial Securities but not payable on the Option Securities.  The option hereby granted will expire 30 days after the date hereof and may be exercised in whole or in part from time to time on one or more occasions only for the purpose of covering overallotments which may be made in connection with the offering and distribution of the Initial Securities upon notice by the Representatives to the Company setting forth the number of Option Securities as to which the several Underwriters are then exercising the option and the time and date of payment and delivery for such Option Securities.  Any such time and date of delivery (a “Date of Delivery”) shall be determined by the Representatives, but shall not be later than seven full business days after the exercise of said option, nor in any event prior to the Closing Time, as hereinafter defined.  Any such notice shall be given at least one business day prior to the Date of Delivery.  If the option is exercised as to all or any portion of the Option Securities, each of the Underwriters, acting severally and not jointly, will purchase that proportion of the total number of Option Securities then being purchased which the number of Initial Securities set forth in Schedule A opposite the name of such Underwriter bears to the total number of Initial Securities, subject in each case to such adjustments as the Representatives in their discretion shall make to eliminate any sales or purchases of fractional shares.

 

(c)            Payment.   Payment of the purchase price, against delivery of certificates or, if applicable, Depositary Receipts evidencing the Depositary Shares, for the Initial Securities shall be made at the offices of [               ] or at such other place as shall be agreed upon by the Representatives and the Company, at 9:00 A.M. (Eastern time) on the second (third, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day) business day after the date hereof (unless postponed in accordance with the provisions of Section 10), or such other time not later than ten business days after such date as shall be agreed upon by the Representatives and the Company (such time and date of payment and delivery being herein called “Closing Time”).

 

In addition, in the event that any or all of the Option Securities are purchased by the Underwriters, payment of the purchase price, and delivery of certificates or, if applicable, Depositary Receipts evidencing the Depositary Shares, for such Option Securities shall be made at the above-mentioned offices, or at such other place as shall be agreed upon by the Representatives and the Company, on each Date of Delivery as specified in the notice from the Representatives to the Company.

 

Payment shall be made to the Company by wire transfer of immediately available funds to a bank account designated by the Company, against delivery to the Representatives through the facilities of The Depository Trust Company (“DTC”) for the respective accounts of the Underwriters of certificates or receipts for the Underwritten Securities to be purchased by them.  It is understood that each Underwriter

 

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has authorized the Representatives, for its account, to accept delivery of, receipt for, and make payment of the purchase price for, the Initial Securities and the Option Securities, if any, which it has agreed to purchase.  The Representatives, individually and not as representatives of the Underwriters, may (but shall not be obligated to) make payment of the purchase price for the Initial Securities or the Option Securities, if any, to be purchased by any Underwriter whose funds have not been received by the Closing Time or the relevant Date of Delivery, as the case may be, but such payment shall not relieve such Underwriter from its obligations hereunder.

 

(d)            Denominations; Registration.   The certificates or receipts for the Initial Securities and the Option Securities, if any, shall be transferred electronically at the Closing Time or the relevant Date of Delivery, as the case may be, in such denominations and registered in such names as the Representatives may request;  provided that any such request must be received in writing at least one full business day before the Closing Time or the relevant Date of Delivery, as the case may be.

 

SECTION 3.          Covenants of the Company .  The Company covenants with each Underwriter as follows:

 

(a)            Compliance with Securities Regulations and Commission Requests.   During any period that a prospectus relating to the Underwritten Securities is required to be delivered under the 1933 Act (but in any event through the Closing Time [and, if any Option Securities are purchased, through the relevant Date of Delivery]), the Company, subject to Section 3(b), will comply with the requirements of Rule 415, Rule 430C and Rule 497 and will notify the Representatives immediately, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective, or any supplement to the Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission relating to the Registration Statement, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information, and (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any preliminary prospectus, or of the suspension of the qualification of the Underwritten Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes.  The Company will promptly effect the filings necessary pursuant to Rule 497 and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 497 was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus.  During any period that a prospectus relating to the Underwritten Securities is required to be delivered under the 1933 Act (but in any event through the Closing Time [and, if any Option Securities are purchased, through the relevant Date of Delivery]), the Company will use its reasonable efforts to prevent the issuance of any stop order and, if any stop order is issued, to obtain the lifting thereof at the earliest possible moment.

 

(b)            Filing of Amendments.   During any period that a prospectus relating to the Underwritten Securities is required to be delivered under the 1933 Act (but in any event through the Closing Time [and, if any Option Securities are purchased, through the relevant Date of Delivery]), the Company will give the Representatives notice of its intention to file or prepare any amendment to the Registration Statement (including any filing under Rule 462(b)) or any amendment, supplement or revision to any preliminary prospectus (including any prospectus included in the Registration Statement at the time it became effective) or to the Prospectus, will furnish the Representatives with copies of any such documents a reasonable amount of time prior to such proposed filing or use, as the case may be, and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object.  The Company has given the Underwriters notice of any filings made pursuant to the 1934 Act or the rules and regulations adopted thereunder within 48 hours prior to the Applicable Time; the Company will give the Underwriters notice of its intention to make any such filing from the Applicable Time to the Closing

 

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Time [and, if any Option Securities are purchased, through the relevant Date of Delivery] and will furnish the Underwriters with copies of any such documents a reasonable amount of time prior to such proposed filing.

 

(c)            Delivery of Commission Filings.   Upon the Representatives’ written request, the Company will deliver to the Representatives, without charge, conformed copies of the Registration Statement as originally filed, and of each amendment thereto (including exhibits filed therewith or incorporated by reference therein) and conformed copies of all consents and certificates of experts, and, upon the Representatives’ request, will also deliver to the Representatives, without charge, a conformed copy of the Registration Statement as originally filed and of each amendment thereto (without exhibits) for each of the Underwriters.  The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T, or as filed with the Commission in paper form as permitted by Regulation S-T.

 

(d)            Delivery of Prospectuses.   The Company has delivered to each Underwriter, without charge, as many copies of each preliminary prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the 1933 Act.  The Company will furnish to each Underwriter, without charge, during the period when the Prospectus is required to be delivered under the 1933 Act, such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may reasonably request.  The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

 

(e)            Continued Compliance with Securities Laws.   The Company will use its commercially reasonable efforts to comply with the 1933 Act and the 1933 Act Regulations so as to permit the completion of the distribution of the Underwritten Securities as contemplated in this Agreement and in the Prospectus.  If at any time when a prospectus is required by the 1933 Act to be delivered in connection with sales of the Underwritten Securities, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to amend the Registration Statement or amend or supplement the Prospectus in order that the Prospectus will not include any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, or if it shall be necessary, in the opinion of such counsel, at any such time to amend the Registration Statement or amend or supplement the Prospectus in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and file with the Commission, subject to Section 3(b), such amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus comply with such requirements, and the Company will furnish to the Underwriters such number of copies of such amendment or supplement as the Underwriters may reasonably request.

 

(f)             Blue Sky Qualifications.   The Company will use its commercially reasonable efforts, in cooperation with the Underwriters, to qualify the Underwritten Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Representatives may designate and to maintain such qualifications in effect for as long as the Representatives reasonably request; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

 

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(g)            Rule 158.   The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally available to its securityholders as soon as reasonably practicable an earnings statement for the purposes of, and to provide the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.

 

(h)            Use of Proceeds.   The Company will use the net proceeds received by it from the sale of the Underwritten Securities in the manner specified in the General Disclosure Package and in the Prospectus under “Use of Proceeds”.

 

(i)             Listing. The Company will use its commercially reasonable efforts to effect and maintain the listing of [if applicable, describe Securities] on [describe applicable stock exchange or quotation service].

 

(j)             Restriction on Sale of Underwritten Securities.   During a period of · days from the date of the Prospectus, the Company will not, and will not publicly disclose the intention to, without the prior written consent of the Representatives, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any Underwritten Securities or any securities convertible into or exercisable or exchangeable for Underwritten Securities or file any registration statement under the 1933 Act with respect to any of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of Underwritten Securities, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of Underwritten Securities or such other securities, in cash or otherwise.  The foregoing sentence shall not apply to (A) the registration and sale of Underwritten Securities to be sold hereunder, (B) the issuance of any Underwritten Securities issued by the Company upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof and referred to in the Prospectus, and any registration related thereto, (C) any Underwritten Securities issued or options to purchase Underwritten Securities granted pursuant to existing dividend reinvestment plans or employee benefit plans of the Company referred to in the Prospectus, and any registration related thereto, (D) any Underwritten Securities issued pursuant to any non-employee director stock plan or dividend reinvestment plan, and any registration related thereto, (E) any Underwritten Securities issued to directors in lieu of directors’ fees, and any registration related thereto, (F) any post-effective amendment to the Registration Statement filed solely to add exhibits to the Registration Statement and which post-effective amendment becomes effective immediately upon filing with the Commission in accordance with Rule 462(d) under the 1933 Act, or (G) the issuance by the Company of any shares of Common Stock as consideration for any other strategic acquisitions, provided , that (i) such issuance would not result in the issuance of shares in an amount greater than 5% of the Company’s then outstanding shares of Common Stock, (ii) the Company does not file a registration statement with respect to such shares prior to the expiration of the period set forth in this subsection (j) and (iii) the Representatives receive a signed lock-up agreement for the balance of the period set forth in this subsection (j) from each recipient of shares of Common Stock issued in connection with such an acquisition under this clause (G).

 

(k)            Reporting Requirements.   The Company, during the period when the Prospectus is required to be delivered under the 1933 Act, will file all documents required to be filed with the Commission pursuant to the 1934 Act within the time periods required by the 1934 Act and the rules and regulations of the Commission thereunder.

 

(l)             Business Development Company Status .  The Company, during a period of at least 12 months from the Closing Time, will use its commercially reasonable efforts to maintain its status as a business development company; provided however , the Company may cease to be, or withdraw its election as, a business development company, with the approval of the board of directors and a vote of stockholders as required by Section 58 of the 1940 Act or any successor provision.

 

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(m)           Regulated Investment Company Status .  During the 12-month period following the Closing Time, the Company will use its commercially reasonable efforts to qualify and elect to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”) and to maintain such qualification and election in effect for each full fiscal year during which it is a business development company under the 1940 Act.

 

(n)            Accounting Controls.  The Company will use its commercially reasonable efforts to maintain a system of internal accounting controls sufficient to provide reasonable assurances that (A) material information relating to the Company and the assets managed by the Adviser is promptly made known to the officers responsible for establishing and maintaining the system of internal accounting controls; and (B) any significant deficiencies or weaknesses in the design or operation of internal accounting controls which could adversely affect the Company’s ability to record, process, summarize and report financial data, and any fraud whether or not material that involves management or other employees who have a significant role in internal controls, are adequately and promptly disclosed to the Company’s independent auditors and the audit committee of the Company’s board of directors.

 

(o)            Marketing Materials .          Before using, authorizing, approving or referring to any Marketing Materials, the Company will furnish to the Representatives and counsel for the Underwriters a copy of such materials for review and will not use, authorize, approve or refer to any such materials to which the Representatives or the counsel for the Underwriters reasonably object.

 

SECTION 4.          Payment of Expenses .

 

(a)            Expenses.   The Company will pay all expenses incident to the performance of its obligations under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and exhibits) as originally filed and of each amendment thereto, (ii) the printing and delivery to the Underwriters of this Agreement, the Warrant Agreement, the Certificate of Designation, the Deposit Agreement, if applicable, any Agreement among the Underwriters and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the Underwritten Securities, (iii) the preparation, issuance and delivery of the certificates for the Underwritten Securities and any Warrant Securities issuable upon exercise of the Warrants to the Underwriters, including any stock or other transfer taxes and any stamp or other duties payable upon the sale, issuance or delivery of the Underwritten Securities and any Warrant Securities to the Underwriters, (iv) the fees and disbursements of the Company’s, the Adviser’s and the Administrator’s counsel, accountants and other advisors, (v) the qualification of the Underwritten Securities and any Warrant Securities issuable upon exercise of the Warrants under securities laws in accordance with the provisions of Section 3(f) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the preparation of the Blue Sky Survey and any supplement thereto, (vi) the printing and delivery to the Underwriters of copies of each preliminary prospectus and of the Prospectus and any amendments or supplements thereto, (vii) the preparation, printing and delivery to the Underwriters of copies of the Blue Sky Survey and any supplement thereto, (viii) the fees and expenses of any transfer agent or registrar for the Underwritten Securities, [(ix) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the Underwritten Securities, including without limitation, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of aircraft and other transportation chartered in connection with the road show,] (x) the filing fees incident to, and the

 

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reasonable fees and disbursements of counsel to the Underwriters in connection with, the review by the Financial Industry Regulatory Authority (“FINRA”) of the terms of the sale of the Underwritten Securities, (xi) the fees and expenses incurred in connection with the inclusion of the Underwritten Securities or any Warrant Securities, if applicable, in [describe applicable stock exchange or quotation service] and (xii) the costs and expenses (including without limitation any damages or other amounts payable in connection with legal or contractual liability) associated with the reforming of any contracts for sale of the Underwritten Securities made by the Underwriters (which are terminated prior to the Closing Time) caused by a breach of the representation contained in the fourth paragraph of Section 1(a)(i). [In the event there are any road show or marketing expenses, the Underwriters will pay their own expenses and the Company will pay its own expenses.]

 

(b)            Termination of Agreement.   If this Agreement is terminated by the Representatives in accordance with the provisions of Section 5 or Section 9(a)(i) and (iii) hereof, the Company shall reimburse the Underwriters for all of their out-of-pocket expenses incurred, including the reasonable fees and disbursements of counsel for the Underwriters.

 

SECTION 5.          Conditions of Underwriters’ Obligations .  The obligations of the several Underwriters hereunder are subject to the accuracy of the representations and warranties of the Company, the Adviser and the Administrator contained in Section 1 hereof or in certificates of any officer of the Company, the Adviser or the Administrator, to the performance by the Company, the Adviser and the Administrator of their respective covenants and other obligations hereunder, and to the following further conditions:

 

(a)            Effectiveness of Registration Statement.   The Registration Statement, including any Rule 462(b) Registration Statement, has become effective and at Closing Time no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriters.  A final prospectus containing the Rule 430C Information shall have been filed with the Commission in accordance with Rule 497.

 

(b)            Opinions of Counsel for Company.   At Closing Time, the Representatives shall have received the favorable opinion, dated as of Closing Time, of Kirkland & Ellis LLP, counsel for the Company, Eversheds Sutherland (US) LLP, special regulatory counsel for the Company, and Venable LLP, special Maryland counsel for the Company, in each case in form and substance reasonably satisfactory to counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters to the effect set forth in Exhibits A through C hereto.  Such counsel may state that, insofar as such opinion involves factual matters, they have relied upon certificates of officers of the Company and/or any of the Subsidiaries and certificates of public officials.

 

(c)            Opinion of Counsel for Underwriters.   At Closing Time, the Representatives shall have received the favorable opinion, dated as of Closing Time, of [               ], counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters.  In giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the State of New York and the federal law of the United States upon the opinions of counsel reasonably satisfactory to the Representatives, including counsel of the Company.  Such counsel may also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers of the Company and/or any of the Subsidiaries and certificates of public officials.

 

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(d)                                  Officers’ Certificates.   (i) At Closing Time, there shall not have been, since the date hereof or since the respective dates as of which information is given in the Prospectus or the General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and the Subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, and the Representatives shall have received a certificate of the chief executive officer or president of the Company and of the chief financial or chief accounting officer of the Company, dated as of Closing Time, to the effect that (A) there has been no such material adverse change, (B) the representations and warranties in Section 1(a) hereof are true and correct with the same force and effect as though expressly made at and as of Closing Time, (C) the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied at or prior to Closing Time and (D) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to their knowledge, contemplated by the Commission.

 

(ii)                                   At Closing Time, there shall not have been, since the date hereof or since the respective dates as of which information is given in the Prospectus or the General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs, business prospects or regulatory status of the Adviser or the Administrator, whether or not arising in the ordinary course of business, that would reasonably be expected to result in a Material Adverse Effect (collectively, with respect to each of the Adviser and the Administrator, an “Advisers Material Adverse Effect”), and the Representatives shall have received a certificate of a vice president (or other authorized officer) and the chief financial or chief accounting officer (or other authorized officer) of each of the Adviser and the Administrator, dated as of Closing Time, to the effect that (A) there has been no such Advisers Material Adverse Effect, (B) the representations and warranties of the Adviser and Administrator in Sections 1(a) and 1(b) hereof are true and correct with the same force and effect as though expressly made at and as of Closing Time, (C) the Adviser and the Administrator have complied with all agreements and satisfied all conditions on their part to be performed or satisfied at or prior to Closing Time and (D) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to their knowledge, contemplated by the Commission.

 

(e)                                   Accountant’s Comfort Letter and CFO Certificate.   At the time of the execution of this Agreement the Representatives shall have received:

 

(i)                                      A letter from KPMG LLP, independent public accountants for the Company, in form and substance reasonably satisfactory to the Representatives, covering the financial information in the Registration Statement, the General Disclosure Package and the Prospectus of the Company, together with signed or reproduced copies of such letter for each of the other Underwriters, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus.

 

(ii)                                   A certificate of the chief financial officer of the Company, in form and substance reasonably satisfactory to the Representatives and as agreed upon prior to the date hereof, covering certain financial matters of the Company, together with signed or reproduced copies of such certificate for each of the other Underwriters.

 

(f)                                    Bring-down Comfort Letter and CFO Certificate .  At Closing Time, the Representatives shall have received (i) from KPMG LLP, the independent public accountants for the Company, a letter, dated as of Closing Time, to the effect that they reaffirm the statements made in the letter furnished

 

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pursuant to subsection (e)(i) of this Section, except that the specified date referred to shall be a date not more than three business days prior to Closing Time and (ii) from the Company a certificate of the chief financial officer of the Company, dated as of the Closing Time, to the effect that the chief financial officer of the Company reaffirms the statements made in the certificate furnished pursuant to subsection (e)(ii) of this Section.

 

(g)                                   [ Approval of Listing.   At Closing Time, the [describe applicable stock exchange or quotation service] shall have [completed its review of the [describe applicable form required by exchange] with respect to the [if applicable, describe Securities]] [OR] [approved [if applicable, describe Securities] for inclusion in [describe applicable stock exchange or quotation service], subject only to official notice of issuance].]

 

(h)                                  No Objection.   FINRA has confirmed that it has not raised any objection with respect to the fairness and reasonableness of the underwriting terms and arrangements.

 

(i)                                      Lock-up Agreements.   At the date of this Agreement, the Representatives shall have received an agreement substantially in the form of Exhibit E hereto signed by the persons listed on Schedule E hereto.  Notwithstanding the foregoing or any provision of Section 3(j) of this Agreement or any lock-up agreement delivered in connection with this Section 5(i) to the contrary, Ares Management Corporation and its controlled affiliates (collectively, “Ares”) may pledge shares of Common Stock of the Company owned by Ares in one or more bona fide lending transactions.

 

(j)                                     Conditions to Purchase of Option Securities.   In the event that the Underwriters exercise their option provided in Section 2(b) hereof to purchase all or any portion of the Option Securities, the representations and warranties of the Company, the Adviser and the Administrator contained herein and the statements in any certificates furnished by the Company, the Adviser and the Administrator hereunder shall be true and correct as of each Date of Delivery, (y) as of each Date of Delivery, no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriters, and (z) at the relevant Date of Delivery, the Representatives shall have received:

 

(i)                                      Officers’ Certificates .

 

(A)                                A certificate, dated such Date of Delivery, of the chief executive officer or president of the Company and of the chief financial or chief accounting officer of the Company confirming that the certificate delivered at the Closing Time pursuant to Section 5(d)(i) hereof remains true and correct as of such Date of Delivery.

 

(B)                                A certificate, dated such Date of Delivery, of a vice president (or other authorized officer) and the chief financial or chief accounting officers (or other authorized officer) of each of the Adviser and the Administrator confirming that the certificates delivered at the Closing Time pursuant to Section 5(d)(ii) hereof remain true and correct as of such Date of Delivery.

 

(ii)                                   Opinions of Counsel for Company .  The favorable opinions of Kirkland & Ellis LLP, counsel for the Company, Eversheds Sutherland (US) LLP, special regulatory counsel for the Company, and Venable LLP, special Maryland counsel for the Company, in each case in form and substance reasonably satisfactory to the Representatives, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinions required by Section 5(b) hereof.

 

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(iii)                                Opinion of Counsel for Underwriters .  The favorable opinion of [               ], counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(c) hereof.

 

(iv)                               Bring-down Comfort Letter and CFO Certificate .

 

(A)                                A letter from KPMG LLP, independent public accountants for the Company, in form and substance reasonably satisfactory to the Representatives and dated such Date of Delivery, substantially in the same form and substance as the letter furnished to the Representatives by KPMG LLP pursuant to Section 5(f)(i) hereof, except that the “specified date” in the letter furnished pursuant to this paragraph shall be a date not more than five days prior to such Date of Delivery.

 

(B)                                A certificate, in form and substance reasonably satisfactory to the Representatives and dated such Date of Delivery, substantially in the same form and substance as the certificate furnished to the Representatives pursuant to Section 5(f)(ii) hereof.

 

(k)                                  Additional Documents.   At Closing Time and at each Date of Delivery, counsel for the Underwriters shall have been furnished with such documents as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Underwritten Securities as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company, the Adviser and the Administrator in connection with the issuance and sale of the Underwritten Securities as herein contemplated shall be reasonably satisfactory in form and substance to the Representatives and counsel for the Underwriters.

 

(l)                                      Termination of Agreement.   If any condition specified in this Section shall not have been fulfilled when and as required to be fulfilled, this Agreement, or, in the case of any condition to the purchase of Option Securities, on a Date of Delivery which is after the Closing Time, the obligations of the several Underwriters to purchase the relevant Option Securities, may be terminated by the Representatives by notice to the Company at any time at or prior to Closing Time or such Date of Delivery, as the case may be, and such termination shall be without liability of any party to any other party except as provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any such termination and remain in full force and effect.

 

SECTION 6.                             Indemnification .

 

(a)                                  (1)   Indemnification of Underwriters by the Company and the Adviser.   The Company and the Adviser, jointly and severally, agree to indemnify and hold harmless each Underwriter, its affiliates, as such term is defined in Rule 501(b) under the 1933 Act (each, an “Affiliate”), its selling agents and each person, if any, who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:

 

(i)                                      against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including the Rule 430C Information (including the information on Schedule B hereto), or the omission or alleged

 

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omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or the Marketing Materials, or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;

 

(ii)                                   against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Company;

 

(iii)                                against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Representatives), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above;

 

provided , however , that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials.

 

(2)   Indemnification of Underwriters by the Administrator.   The Administrator agrees to indemnify and hold harmless each Underwriter, its Affiliates, its selling agents and each person, if any, who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:

 

(i)                                      against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including the Rule 430C Information (including the information on Schedule B hereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or in the Marketing Materials, or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading to the extent the loss, liability, claim, damage and expense relates to information concerning the Administrator;

 

(ii)                                   against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or

 

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of any claim whatsoever based upon any such untrue statement or omission related to the Administrator or any such alleged untrue statement or omission related to the Administrator; provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Company;

 

(iii)                                against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Representatives), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission related to the Administrator, or any such alleged untrue statement or omission related to the Administrator, to the extent that any such expense is not paid under (i) or (ii) above;

 

provided , however , that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials.

 

(b)                                  Indemnification of Company, Directors, Officers, Adviser and Administrator.   Each Underwriter severally agrees to indemnify and hold harmless the Company, its directors, each of its officers, each person, if any, who controls the Company, the Adviser or the Administrator within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, the Adviser and the Administrator against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or the Marketing Materials in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or the Marketing Materials.

 

(c)                                   Actions against Parties; Notification.   Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder (an “Action”), but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement.  In the case of parties indemnified pursuant to Section 6(a)(1) or (2) above, counsel to the indemnified parties shall be selected by the Representatives, and, in the case of parties indemnified pursuant to Section 6(b) above, counsel to the indemnified parties shall be selected by the Company.  An indemnifying party may participate at its own expense in the defense of any such Action; provided , however , that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party.  In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one Action or separate but similar or related Actions in the same jurisdiction arising out of the same general allegations or circumstances.  No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to

 

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any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this Section 6 or Section 7 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.  Notwithstanding anything to the contrary herein, neither the assumption of the defense of any such Action nor the payment of any fees or expenses related thereto shall be deemed to be an admission by the indemnifying party that it has an obligation to indemnify any person pursuant to this Agreement.

 

(d)                                  Settlement Without Consent if Failure to Reimburse.   If at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 6(a)(1)(ii) or 6(a)(2)(ii) effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.

 

(e)                                   Acknowledgement by the Company, the Adviser and the Administrator .  The Company, the Adviser and the Administrator also acknowledge and agree that (i) the purchase and sale of any Underwritten Securities pursuant to this Agreement, including the determination of the public offering price of the Underwritten Securities and any related discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the Underwriters of such Underwritten Securities, on the other hand, (ii) in connection with the public offering of the Underwritten Securities and the process leading to such transaction the Underwriters will act solely as principals and not as agents or fiduciaries of the Company or its stockholders, creditors, employees or any other party, (iii) the Underwriters will not assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering of Underwritten Securities contemplated hereby or the process leading thereto (irrespective of whether the Underwriters have advised or are currently advising the Company on other matters) and the Underwriters will not have any obligation to the Company with respect to the offering except the obligations expressly set forth herein, (iv) the Underwriters and their affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company, and (v) the Underwriters have not provided and will not provide any legal, accounting, regulatory or tax advice with respect to the offering of the Underwritten Securities and the Company has consulted and will consult its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.

 

SECTION 7.                             Contribution .  If the indemnification provided for in Section 6 hereof is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, the Adviser and the Administrator on the one hand and the Underwriters on the other hand from the offering of the Underwritten Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, the Adviser and the Administrator on the one hand and of the Underwriters on the other hand in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.

 

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The relative benefits received by the Company, the Adviser and the Administrator on the one hand and the Underwriters on the other hand in connection with the offering of the Underwritten Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Underwritten Securities pursuant to this Agreement (before deducting expenses) received by the Company and the total underwriting discount received by the Underwriters, in each case as set forth on the cover of the Prospectus, bear to the aggregate initial public offering price of the Underwritten Securities as set forth on the cover of the Prospectus.

 

The relative fault of the Company, the Adviser and the Administrator on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company, the Adviser and the Administrator or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

The Company, the Adviser, the Administrator and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 7.  The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section 7 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission.

 

Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Underwritten Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of any such untrue or alleged untrue statement or omission or alleged omission.

 

No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

 

For purposes of this Section 7, each person, if any, who controls an Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and each Underwriter’s Affiliates and selling agents shall have the same rights to contribution as such Underwriter, and each director of the Company, each officer of the Company, and each person, if any, who controls the Company, Adviser or Administrator within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as the Company, Adviser or Administrator, as the case may be.  The Underwriters’ respective obligations to contribute pursuant to this Section 7 are several in proportion to the number of Initial Securities set forth opposite their respective names in Schedule A hereto and not joint.

 

Notwithstanding any other provision of Section 6 and this Section 7, no party shall be entitled to indemnification or contribution under this Agreement in violation of Section 17(i) of the 1940 Act.

 

SECTION 8.                             Representations, Warranties and Agreements to Survive .  All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company, any of the Subsidiaries, the Adviser and the Administrator submitted pursuant hereto, shall remain operative

 

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and in full force and effect regardless of (i) any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter, its officers or directors or any person controlling the Company and (ii) delivery of and payment for the Underwritten Securities.

 

SECTION 9.                             Termination of Agreement .

 

(a)                                  Termination; General.   The Representatives may terminate this Agreement [or, with respect to any Date of Delivery which occurs after the Closing Time, the obligations of the Underwriters to purchase the Option Securities to be purchased and sold on such Date of Delivery,] by notice to the Company, at any time at or prior to Closing Time [or such Date of Delivery, as applicable,] (i) if there has been, since the time of execution of this Agreement or since the respective dates as of which information is given in the Prospectus or the General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and the Subsidiaries considered as one enterprise, the Adviser or the Administrator, whether or not arising in the ordinary course of business, or (ii) if there has occurred any material adverse change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or development involving a prospective change in national or international political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Representatives, impracticable or inadvisable to market the Underwritten Securities or to enforce contracts for the sale of the Underwritten Securities, or (iii) if trading in any securities of the Company has been suspended or materially limited by the Commission or the Nasdaq Global Select Market or the Nasdaq Global Market or The New York Stock Exchange, or (iv) if trading generally on The New York Stock Exchange, the NYSE American LLC, the Nasdaq Global Market or the Nasdaq Global Select Market has been suspended or materially limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices have been required, by any of said exchanges or by such system or by order of the Commission, FINRA or any other governmental authority, or (v) a material disruption has occurred in commercial banking or securities settlement or clearance services in the United States, or (vi) if a banking moratorium has been declared by either Federal or New York authorities.

 

(b)                                  Liabilities.   If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any party to any other party except as provided in Section 4 hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such termination and remain in full force and effect.

 

SECTION 10.                      Default by One or More of the Underwriters .  If one or more of the Underwriters shall fail at Closing Time or a Date of Delivery to purchase the Underwritten Securities which it or they are obligated to purchase under this Agreement (the “Defaulted Securities”), the Representatives shall have the right, within 24 hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms herein set forth; if, however, the Representatives shall not have completed such arrangements within such 24-hour period, then:

 

(i)                                      if the number of Defaulted Securities does not exceed 10% of the number of Underwritten Securities to be purchased on such date, each of the non-defaulting Underwriters shall be obligated, severally and not jointly, to purchase the full amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all non-defaulting Underwriters, or

 

(ii)                                   if the number of Defaulted Securities exceeds 10% of the number of Underwritten Securities to be purchased on such date, this Agreement or, with respect to any Date of Delivery which occurs after the Closing Time, the obligation of the Underwriters to purchase and of the Company to sell the Option Securities to be purchased and sold on such Date of Delivery shall terminate without liability on the part of any non-defaulting Underwriter.

 

28


 

No action taken pursuant to this Section shall relieve any defaulting Underwriter from liability in respect of its default.

 

In the event of any such default which does not result in a termination of this Agreement or, in the case of a Date of Delivery which is after the Closing Time, which does not result in a termination of the obligation of the Underwriters to purchase and the Company to sell the relevant Option Securities, as the case may be, either the Representatives or the Company shall have the right to postpone Closing Time or the relevant Date of Delivery, as the case may be, for a period not exceeding seven days in order to effect any required changes in the Registration Statement, the General Disclosure Package or the Prospectus or in any other documents or arrangements.  As used herein, the term “Underwriter” includes any person substituted for an Underwriter under this Section 10.

 

SECTION 11.                      Tax Disclosure .  Notwithstanding any other provision of this Agreement, from the commencement of discussions with respect to the transactions contemplated hereby, the Company (and each employee, representative or other agent of the Company) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure (as such terms are used in Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury Regulations promulgated thereunder) of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided relating to such tax treatment and tax structure.

 

SECTION 12.                      Notices .  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication.  Notices to the Underwriters shall be directed to the Representatives at [               ], with a copy to [               ].  Notices to the Company, the Adviser and Administrator shall be directed to them at 245 Park Avenue, 44 th  Floor, New York, New York 10167, Attention: General Counsel, with a copy to Kirkland & Ellis LLP, 2029 Century Park East, 14th Floor, Los Angeles, CA 90067, Attention: Monica Shilling.

 

SECTION 13.                      Parties .  This Agreement shall each inure to the benefit of and be binding upon the Underwriters and the Company and their respective successors.  Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriters, the Company, the Adviser and the Administrator and their respective successors and the controlling persons and officers and directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained.  This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriters, the Company, the Adviser and the Administrator and their respective successors, and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation.  No purchaser of Underwritten Securities from any Underwriter shall be deemed to be a successor by reason merely of such purchase.

 

SECTION 14.                      Governing Law .  This Agreement shall be governed by and construed in accordance with the laws of the State of New York, including without limitation Section 5-1401 of the New York General Obligations Law.

 

SECTION 15.                      Time .  Time shall be of the essence of this Agreement.  Except as otherwise set forth herein, specified times of day refer to New York City time.

 

29


 

SECTION 16.                      Submission to Jurisdiction .  Except as set forth below, no claim or action may be commenced, prosecuted or continued in any court other than the courts of the State of New York located in the City and County of New York or in the United States District Court for the Southern District of New York, which courts shall have jurisdiction over the adjudication of such matters, and both the Underwriters and the Company consent to the jurisdiction of such courts and personal service with respect thereto.  The Company hereby consents to personal jurisdiction, service and venue in any court in which any claim or action arising out of or in any way relating to this Agreement is brought by any third party against the Underwriters or any indemnified party.  The Underwriters and the Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) waives all right to trial by jury in any action, proceeding or counterclaim (whether based upon contract, tort or otherwise) in any way arising out of or relating to this Agreement.

 

SECTION 17.                      Counterparts .  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.

 

SECTION 18.                      Effect of Headings .  The Section headings herein are for convenience only and shall not affect the construction hereof.

 

SECTION 19.                      USA Patriot Act . In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), the Underwriters are required to obtain, verify and record information that identifies their respective clients, including the Company, which information may include the name and address of their respective clients, as well as other information that will allow the Underwriters to properly identify their respective clients.

 

SECTION 20. Recognition of the U.S. Special Resolution Regimes .

 

(a) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

 

(b) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

 

“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).

 

“Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

 

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

 

“U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

 

30


 

If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement between the Underwriters, the Company, the Adviser and the Administrator in accordance with its terms.

 

 

 

Very truly yours,

 

 

 

 

 

COMPANY:

 

 

 

 

 

ARES CAPITAL CORPORATION

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

ADVISER:

 

 

 

 

 

ARES CAPITAL MANAGEMENT LLC

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

ADMINISTRATOR:

 

 

 

 

 

ARES OPERATIONS LLC

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

CONFIRMED AND ACCEPTED,

 

 

as of the date first above written:

 

 

 

 

 

[NAME OF REPRESENTATIVES]

 

 

 

 

 

 

By

 

 

 

 

Authorized Signatory

 

 

 

 

 

For themselves and as Representatives of the

 

 

other Underwriters named in Schedule A hereto.

 

 

 

31


 

SCHEDULE A

 

Name of Underwriter

 

Number of
Shares of
Common Stock

 

Number of
Shares of
Preferred Stock

 

Number of
Warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sch A- 1


 

SCHEDULE B

 

ARES CAPITAL CORPORATION

 

· Shares of Common Stock (Par Value $0.001 Per Share)
· Shares of Preferred Stock (Par Value $ · Per Share)
and
· Warrants to Purchase Common Stock or Preferred Stock

 

1.             The public offering price per share for the Underwritten Securities, determined as provided in Section 2, shall be $ · .

 

2.             The purchase price per share for the Underwritten Securities to be paid by the several Underwriters shall be $ · , being an amount equal to the public offering price set forth above less $ · per share; provided that the purchase price per share for any Option Securities purchased upon the exercise of the overallotment option described in Section 2(b) shall be reduced by an amount per share equal to any dividends or distributions declared by the Company and payable on the Initial Securities but not payable on the Option Securities.

 

3.             The trade date is · .

 

4.             The closing date will be · .

 

Sch B- 1


 

SCHEDULE C

 

ARES CAPITAL CORPORATION
CONSOLIDATED SUBSIDIARIES

 

Sch C- 1


 

SCHEDULE D

 

MARKETING MATERIALS

 

Sch D- 1


 

SCHEDULE E

 

List of persons and entities
subject to lock-up

 

Sch E- 1




Exhibit (h)(2)

 

ARES CAPITAL CORPORATION
(a Maryland corporation)

 

$ · Aggregate Principal Amount Senior Securities
$ · Aggregate Principal Amount Subordinated Securities
and
Warrants to Purchase Debt Securities

 

PURCHASE AGREEMENT

 

[Date]

 

[Names of Underwriters]
[Address]

 

Ladies and Gentlemen:

 

Ares Capital Corporation, a Maryland corporation (the “Company”), confirms its agreement with [               ] (“[               ]”) and each of the other Underwriters named in Schedule A hereto (collectively, the “Underwriters”, which term shall also include any underwriter substituted as hereinafter provided in Section 10 hereof), for whom [               ] are acting as representatives (in such capacity, the “Representatives”), with respect to the issue and sale by the Company and the purchase by the Underwriters, acting severally and not jointly, of $ · aggregate principal amount of senior debt securities (the “Senior Securities”) or subordinated debt securities (the “Subordinated Securities”), or both, or Warrants (the “Debt Warrants”) to purchase Senior Securities or Subordinated Securities, or both, of the Company set forth in said Schedule A, and with respect to the grant by the Company to the Underwriters, acting severally and not jointly, of the option described in Section 2(b) hereof to purchase additional Securities (as hereinafter defined) to cover overallotments, if any.

 

The [Senior Securities][Subordinated Securities] will be issued under an indenture, dated as of · (the “Base Indenture”), between the Company and [Name of Trustee for Indenture], as trustee (the “Trustee”), as supplemented by a supplemental indenture, dated as of · , between the Company and the Trustee (the “Supplemental Indenture” and, together with the Base Indenture, the “Indenture”). The Debt Warrants will be issued under one or more warrant agreements (the warrant agreement relating to any issue of Debt Warrants to be sold pursuant to this Agreement is referred to herein as the “Warrant Agreement”) between the Company and the Warrant Agent identified in such Warrant Agreement (the “Warrant Agent”).  The Senior Securities, Subordinated Securities or Debt Warrants or any combination thereof are hereinafter referred to as the “Securities”.  The aforesaid Securities (the “Initial Securities”) to be purchased by the Underwriters and all or any part of the Securities subject to the option described in Section 2(b) hereof (the “Option Securities”) are hereinafter called, collectively, the “Underwritten Securities”; and “Warrant Securities” shall mean the Senior Securities or Subordinated Securities issuable upon exercise of Debt Warrants.  The Senior Securities, Subordinated Securities and the Debt Warrants may be offered either together or separately.  Each issue of Senior Securities, Subordinated Securities and Debt Warrants may vary, as applicable, as to aggregate principal amount, maturity date, interest rate or formula and timing of payments thereof, redemption provisions, conversion provisions and sinking fund requirements, if any, and any other variable terms which the Indenture or any Warrant Agreement, as the case may be, contemplates may be set forth in the Senior Securities, Subordinated Securities and Debt Warrants as issued from time to time.  Securities issued in book-entry form will be issued to Cede & Co. as nominee of the Depository Trust Company (“DTC”) pursuant to a blanket letter of representations, [to be dated on or prior to the Closing Time] (the “DTC Agreement”), between the Company and DTC.

 


 

The Company understands that the Underwriters propose to make a public offering of the Securities as soon as the Representatives deem advisable after this Agreement has been executed and delivered.

 

The Company has filed with the Securities and Exchange Commission (the “Commission”) a shelf registration statement on Form N-2 (File No. 333-[ · ]) covering the registration of the Underwritten Securities and certain of the Company’s other securities under the Securities Act of 1933, as amended (the “1933 Act”), which registration statement was declared effective on · by the Commission.  The Indenture has been qualified under the Trust Indenture Act of 1939, as amended (the “1939 Act”).  The Company has also filed with the Commission a preliminary prospectus supplement, dated · , which contains a base prospectus, dated · (collectively, the “preliminary prospectus”).  Promptly after execution and delivery of this Agreement, the Company will prepare and file a prospectus in accordance with the provisions of Rule 430C (“Rule 430C”) of the rules and regulations of the Commission under the 1933 Act (the “1933 Act Regulations”) and Rule 497 (“Rule 497”) of the 1933 Act Regulations.  The information included in such prospectus that was omitted from such registration statement at the time it became effective but that is deemed to be part of such registration statement pursuant to Rule 430C is referred to as “Rule 430C Information.”  Unless the context otherwise requires, such registration statement, including all documents filed as a part thereof, and including all post-effective amendments thereto filed on or prior to the date hereof and any Rule 430C Information contained in a prospectus subsequently filed with the Commission pursuant to Rule 497 under the 1933 Act and deemed to be part of the registration statement and also including any registration statement filed pursuant to Rule 462(b) of the 1933 Act Regulations (the “Rule 462(b) Registration Statement”), is herein called the “Registration Statement.”  The final prospectus in the form filed by the Company with the Commission pursuant to Rule 497 under the 1933 Act on or before the second business day after the date hereof (or such earlier time as may be required under the 1933 Act), which will include the base prospectus, dated · , together with a final prospectus supplement, is herein called the “Prospectus.”  For purposes of this Agreement, all references to the Registration Statement, any preliminary prospectus, the Prospectus or any amendment or supplement to any of the foregoing shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval system (“EDGAR”).

 

A Form N-54A Notification of Election to be Subject to Sections 55 through 65 of the Investment Company Act of 1940 filed Pursuant to Section 54(a) of the Investment Company Act (File No.  814-00663) (the “Notification of Election”) was filed with the Commission on April 21, 2004 under the Investment Company Act of 1940, as amended, and the rules and regulations thereunder (collectively, the “1940 Act”).

 

The Company has entered into an Amended and Restated Investment Advisory and Management Agreement, dated as of June 6, 2011 (the “Investment Advisory Agreement”), with Ares Capital Management LLC, a Delaware limited liability company registered as an investment adviser (the “Adviser”), under the Investment Advisers Act of 1940, as amended, and the rules and regulations thereunder (collectively, the “Advisers Act”).

 

The Company has entered into an Amended and Restated Administration Agreement, dated as of June 1, 2007 (the “Administration Agreement”), with Ares Operations LLC, a Delaware limited liability company (the “Administrator”).

 


 

SECTION 1.                             Representations and Warranties .

 

(a)                                  Representations and Warranties by the Company.   The Company represents and warrants to each Underwriter as of the date hereof, as of the Applicable Time referred to in Section 1(a)(i) hereof, as of the Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if any) referred to in Section 2(b) hereof, and agrees with each Underwriter, as follows:

 

(i)                                      Compliance with Registration Requirements .  The Company is eligible to use Form N-2.  The Registration Statement (and the Registration Statement as amended by any post-effective amendment if the Company shall have made any amendments thereto after the effective date of the Registration Statement) has become effective under the 1933 Act and no stop order suspending the effectiveness of the Registration Statement (and the Registration Statement as amended by any post-effective amendment if the Company shall have made any amendments thereto after the effective date of the Registration Statement) has been issued under the 1933 Act and no proceedings for that purpose have been instituted or are pending or, to the knowledge of the Company, are contemplated by the Commission, and any request on the part of the Commission for additional information has been complied with.

 

At the respective times the Registration Statement and any post-effective amendments thereto became effective, at the Applicable Time and at the Closing Time (and, if any Option Securities are purchased, at each Date of Delivery), the Registration Statement complied and will comply in all material respects with the requirements of the 1933 Act, the 1933 Act Regulations and the 1940 Act and did not and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.  Neither the Prospectus nor any amendments or supplements thereto (including any prospectus wrapper), at the time the Prospectus or any such amendment or supplement was issued, and at the Closing Time (and, if any Option Securities are purchased, at each Date of Delivery), included or will include an untrue statement of a material fact or omitted or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

The Prospectus, each preliminary prospectus and the prospectus filed as part of the Registration Statement as originally filed or as part of any amendment thereto complied when so filed in all material respects with the 1933 Act, the 1933 Act Regulations and the 1940 Act except for any corrections to any preliminary prospectus that are made in the Prospectus and each preliminary prospectus and the Prospectus delivered to the Underwriters for use in connection with this offering was identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

 

As of the Applicable Time, the preliminary prospectus supplement, dated · , together with the base prospectus, dated · , as filed with the Commission on · , and the information included on Schedule B hereto [(which information the Representatives have informed the Company is being conveyed orally by the Underwriters to prospective purchasers at or prior to the Underwriters’ confirmation of sales of Underwritten Securities in the offering)], all considered together (collectively, the “General Disclosure Package”), did not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. As of the date hereof, as of the Applicable Time, and as of the Closing Time (and, if any Option Securities are purchased, at each Date of Delivery), the Marketing Materials (as defined below), together with the information contained in the General Disclosure Package, did not and will not include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

 


 

As used in this subsection and elsewhere in this Agreement, “Applicable Time” means · [a.m.][p.m.] (Eastern time) on · or such other time as agreed by the Company and the Representatives.

 

As used in this subsection and elsewhere in this Agreement, “Marketing Materials” means the materials, if any, set forth on Schedule D hereto.

 

The representations and warranties in this subsection shall not apply to (x) statements in or omissions from the Registration Statement (or any amendment thereto), including the Rule 430C information, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials made in reliance upon and in conformity with written information furnished to the Company by any Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C information, any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials, or (y) the part of the Registration Statement that constitutes the Statement of Eligibility and Qualification under the 1939 Act (Form T-1) of the Trustee under the Indenture.

 

(ii)                                   Independent Accountants .  The accountants who certified the Company’s financial statements included in the Registration Statement, the General Disclosure Package and the Prospectus are independent public accountants as required by the 1933 Act, the 1933 Act Regulations and the Securities Exchange Act of 1934, as amended (the “1934 Act”).

 

(iii)                                Financial Statements .  The financial statements included in the Registration Statement, the General Disclosure Package and the Prospectus, together with the related schedules and notes, present fairly in all material respects the financial position of the Company and its Subsidiaries (as defined below) at the dates indicated and the consolidated statement of operations, consolidated statement of stockholders’ equity and consolidated statement of cash flows of the Company and its Subsidiaries for the periods specified; there are no financial statements that are required to be included in the Registration Statement, the General Disclosure Package or the Prospectus that are not included as required; said financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“GAAP”) applied on a consistent basis throughout the periods involved.  The “Selected Condensed Consolidated Financial Data of Ares Capital” included in the Registration Statement, the General Disclosure Package and the Prospectus present fairly, in all material respects, the information shown therein as of the date presented and have been compiled on a basis consistent with that of the audited financial statements included in the Registration Statement, the General Disclosure Package and the Prospectus.  The financial data set forth in the General Disclosure Package and in the Prospectus under the caption “Capitalization” fairly presents the information set forth therein on a basis consistent with that of the audited financial statements and related notes thereto contained in the Registration Statement.  There is no pro forma financial information that is required to be included in the Registration Statement, the General Disclosure Package and the Prospectus that is not included as required.

 

(iv)                               No Material Adverse Change in Business .  Since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package and the Prospectus, except as otherwise stated therein, (A) there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its Subsidiaries (as defined below) considered as one enterprise, whether or not

 


 

arising in the ordinary course of business (a “Material Adverse Effect”), (B) there have been no transactions entered into by the Company or its Subsidiaries, other than those in the ordinary course of business, which are material with respect to the Company and its Subsidiaries considered as one enterprise, and (C)  there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock.

 

(v)                                  Good Standing of the Company .  The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Maryland and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement, the Investment Advisory Agreement, the Administration Agreement, the Indenture, the Securities and the DTC Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.

 

(vi)                               Subsidiaries .  The Company’s only subsidiaries that are consolidated with the Company for financial reporting purposes under GAAP are those listed on Schedule C hereto (each, a “Subsidiary” and collectively, the “Subsidiaries”). Each of the Subsidiaries has been duly organized and is validly existing as a corporation, limited liability company or limited partnership in good standing under the laws of the jurisdiction of its organization, has power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and is duly qualified as a foreign corporation, limited liability company or limited partnership to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to be so qualified or to be in good standing would not reasonably be expected to result in a Material Adverse Effect; except as otherwise disclosed in the Registration Statement, all of the issued and outstanding capital stock of each such Subsidiary has been duly authorized and validly issued and is fully paid and non-assessable; none of the outstanding shares of capital stock of any of the Subsidiaries was issued in violation of the preemptive or other similar rights of any securityholder of such Subsidiary. Except (A) as set forth in the Registration Statement, the General Disclosure Package and the Prospectus and (B) portfolio investments made after [ · ], the Company does not own, directly or indirectly, any shares of stock or any other equity or debt securities of any corporation or have any equity or debt interest in any firm, partnership, joint venture, association or other entity that is not a Subsidiary.

 

(vii)                            Capitalization .  The authorized, issued and outstanding capital stock of the Company is as set forth in the General Disclosure Package and the Prospectus (as modified by any footnotes therein) under the caption “Capitalization” (except for subsequent issuances, if any, pursuant to the Company’s Dividend Reinvestment Plan or pursuant to reservations, agreements or employee benefit plans, if any, referred to in the General Disclosure Package or in the Prospectus or pursuant to the exercise of convertible securities or options, if any, referred to in the General Disclosure Package or the Prospectus).  The shares of issued and outstanding capital stock of the Company have been duly authorized and validly issued and are fully paid and non-assessable; none of the outstanding shares of capital stock of the Company was issued in violation of preemptive or other similar rights of any securityholder of the Company.

 


 

(viii)                         Authorization of Agreements .

 

(A)                                This Agreement, the Investment Advisory Agreement and the Administration Agreement have each been duly authorized, executed and delivered by the Company.  The Investment Advisory Agreement and the Administration Agreement are valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(B)                                The Indenture has been duly authorized, executed and delivered by the Company and, when executed and delivered by the Trustee will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(C)                                If applicable, the Supplemental Indenture has been duly authorized by the Company and, at the Closing Time, will be executed and delivered by the Company and, when executed and delivered by the Trustee will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(D)                                If applicable, the Warrant Agreement will have been duly authorized, executed and delivered by the Company prior to the issuance of any applicable Debt Warrants and, when executed and delivered by the Warrant Agent, will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(E)                              If applicable, the DTC Agreement will have been duly authorized, executed and delivered by the Company prior to the issuance of the Securities and will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(ix)                               Authorization and Description of Underwritten Securities .  (A)  The Underwritten Securities being sold pursuant to this Agreement and, if applicable, the Warrant Securities issuable upon exercise of the Debt Warrants have been duly authorized for issuance and sale to the Underwriters pursuant to this Agreement and, if applicable, the Warrant Agreement (or will have been so authorized prior to each issuance of Underwritten Securities) and, when issued, authenticated and delivered by the Company and authenticated by the Trustee pursuant to the provisions of this Agreement and, if applicable, the Indenture or Warrant Agreement, or both, as the case may be, relating thereto, against payment of the consideration set

 


 

forth in this Agreement and, if applicable, the Warrant Agreement, will be valid and legally binding obligations of the Company, enforceable in accordance with their terms, except as the enforcement thereof may be subject to the effect of (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought, and will be entitled to the benefits of the Indenture or Warrant Agreement, or both, as the case may be, relating thereto; and the Underwritten Securities, the Indenture and the Warrant Agreement, if any, conform in all material respects to the statements relating thereto contained in the General Disclosure Package and the Prospectus.

 

(B)                                If applicable, upon issuance and delivery of the Underwritten Securities in accordance with this Agreement and the Indenture (including the Supplemental Indenture), the Underwritten Securities will be convertible at the option of the holder thereof into shares of Common Stock, par value $0.001 per share, of the Company (the “Common Stock”), in accordance with the terms of the Underwritten Securities and the Indenture, the shares of Common Stock issuable upon conversion of any issue of the Securities will have been duly authorized and reserved for issuance upon such conversion by all necessary corporate action and, when issued and delivered in accordance with the provisions of this Agreement relating thereto, will be validly issued, fully paid and non-assessable.

 

(x)                                  Absence of Defaults and Conflicts .  Neither the Company nor any of the Subsidiaries is in violation of its charter, by-laws or other organizational documents.  Further, neither the Company nor any of the Subsidiaries is in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or any of the Subsidiaries is a party or by which any of them may be bound, or to which any of the property or assets of the Company or any of the Subsidiaries is subject (collectively, “Agreements and Instruments”) except for such defaults that would not result in a Material Adverse Effect; and the execution, delivery and performance of this Agreement, the Indenture (including the Supplemental Indenture), the Underwritten Securities, the Warrant Agreement, if applicable, the Investment Advisory Agreement, the Administration Agreement and the DTC Agreement and the consummation of the transactions contemplated herein and therein and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Securities and the use of the proceeds from the sale of the Securities as described in the General Disclosure Package and the Prospectus under the caption “Use of Proceeds” and, if applicable, the issuance of the shares of Common Stock upon conversion of the Securities) and compliance by the Company with its obligations hereunder and thereunder do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of the Subsidiaries pursuant to, the Agreements and Instruments, except for such conflicts, breaches, defaults or Repayment Events that would not result in a Material Adverse Effect, nor will such action result in any violation of the provisions of the charter, by-laws or other organizational documents of the Company or any of the Subsidiaries or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Company or any of the Subsidiaries or any of their assets, properties or operations.  As used herein, a “Repayment Event” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of the Subsidiaries.

 


 

(xi)                               Absence of Proceedings .  Other than as disclosed in the General Disclosure Package, there is no action, suit or proceeding or, to the knowledge of the Company, inquiry or investigation, before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting the Company or any of the Subsidiaries, which is required to be disclosed in the General Disclosure Package, or which would result in a Material Adverse Effect, or which would materially and adversely affect the properties or assets thereof or the consummation of the transactions contemplated in this Agreement, the Indenture (including the Supplemental Indenture), the Underwritten Securities, the Warrant Agreement, if applicable, the Investment Advisory Agreement, the Administration Agreement or the DTC Agreement or the performance by the Company of its obligations hereunder or thereunder; the aggregate of all pending legal or governmental proceedings to which the Company or any of the Subsidiaries is a party or of which any of their respective property or assets is the subject which are not described in the General Disclosure Package, including ordinary routine litigation incidental to the business, would not result in a Material Adverse Effect.

 

(xii)                            Accuracy of Exhibits .  There are no contracts or documents which are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits thereto which have not been so described and filed as required.

 

(xiii)                         Possession of Intellectual Property .  The Company and the Subsidiaries own or possess, or can acquire on reasonable terms, adequate patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property (collectively, “Intellectual Property”) necessary to carry on the business now operated by them or proposed to be operated by them immediately following the offering of the Underwritten Securities as described in the General Disclosure Package and the Prospectus, except where the failure to own or possess or otherwise be able to acquire such rights in a timely manner would not otherwise reasonably be expected to result in a Material Adverse Effect, and neither the Company nor any of the Subsidiaries has received any notice of or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which would render any Intellectual Property invalid or inadequate to protect the interest of the Company or any of the Subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.

 

(xiv)                        Absence of Further Requirements .  No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Company of its obligations hereunder, in connection with the offering, issuance or sale of the Underwritten Securities hereunder [and, if applicable, the issuance of shares of Common Stock upon conversion of the Securities] or the consummation of the transactions contemplated by this Agreement, the Indenture, the Underwritten Securities, the Warrant Agreement, if applicable, the Investment Advisory Agreement, the Administration Agreement, the DTC Agreement, the General Disclosure Package or the Prospectus (including the use of the proceeds from the sale of the Underwritten Securities as described in the General Disclosure Package and the Prospectus under the caption “Use of Proceeds”), except (A) such as have been already obtained under the 1933 Act, the 1933 Act Regulations, the 1939 Act or the 1940 Act, (B) such as may be required under state securities laws, and (C) the filing of the Notification of Election under the 1940 Act, which has been effected.

 


 

(xv)                           Absence of Manipulation .  Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate take, directly or indirectly, any action which is designed to or which has constituted or which would be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Underwritten Securities in violation of any law, statute, regulation or rule applicable to the Company or its affiliates.

 

(xvi)                        Possession of Licenses and Permits .  The Company and the Subsidiaries possess such permits, licenses, approvals, consents and other authorizations (collectively, “Governmental Licenses”) issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them or proposed to be operated by them immediately following the offering of the Underwritten Securities as described in the General Disclosure Package and the Prospectus, except where the failure so to possess would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; the Company and the Subsidiaries are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; and neither the Company nor any of the Subsidiaries has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

 

(xvii)                     Investment Company Act .  The Company is not required, and upon the issuance and sale of the Underwritten Securities as herein contemplated and the application of the net proceeds therefrom as described in the Prospectus will not be required, to register as a “registered management investment company” under the 1940 Act.

 

(xviii)                  Registration Rights .  There are no persons with registration rights or other similar rights to have any securities registered pursuant to the Registration Statement or otherwise registered by the Company under the 1933 Act.

 

(xix)                        Related Party Transactions .  There are no business relationships or related party transactions involving the Company, any of the Subsidiaries or any other person required to be described in the Prospectus which have not been described as required.

 

(xx)                           Notification of Election .  When the Notification of Election was filed with the Commission, it (A) contained all statements required to be stated therein in accordance with, and complied in all material respects with the requirements of, the 1940 Act and (B) did not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

(xxi)                        Investment Advisory Agreement .  (A) The terms of the Investment Advisory Agreement, including compensation terms, comply in all material respects with all applicable provisions of the 1940 Act and the Advisers Act and (B) the approvals by the board of directors and the stockholders of the Company of the Investment Advisory Agreement have been made in accordance with the requirements of Section 15 of the 1940 Act applicable to companies that have elected to be regulated as business development companies under the 1940 Act.

 


 

(xxii)                     Interested Persons .  Except as disclosed in the Registration Statement, the General Disclosure Package and the Prospectus (A) no person is serving or acting as an officer, director or investment adviser of the Company, except in accordance with the provisions of the 1940 Act and the Advisers Act, and (B) to the knowledge of the Company, no director of the Company is an “interested person” (as defined in the 1940 Act) of the Company or an “affiliated person” (as defined in the 1940 Act) of any of the Underwriters.

 

(xxiii)                  Business Development Company .  (A) The Company has duly elected to be treated by the Commission under the 1940 Act as a business development company, such election is effective and all required action has been taken by the Company under the 1933 Act and the 1940 Act to make the public offering and consummate the sale of the Underwritten Securities as provided in this Agreement; (B) the provisions of the corporate charter and by-laws of the Company, and the investment objectives, policies and restrictions described in the General Disclosure Package and the Prospectus, assuming they are implemented as described, will comply in all material respects with the requirements of the 1940 Act; and (C) the operations of the Company are in compliance in all material respects with the provisions of the 1940 Act applicable to business development companies.

 

(xxiv)                 Employees and Executives .  The Company is not aware that (A) any executive, key employee or significant group of employees of the Company, any of the Subsidiaries, the Adviser or the Administrator plans to terminate employment with the Company, any of the Subsidiaries, the Adviser or the Administrator or (B) any such executive or key employee is subject to any noncompete, nondisclosure, confidentiality, employment, consulting or similar arrangement that would be violated by the present or proposed business activities of the Company, any of the Subsidiaries, the Adviser or the Administrator except where such termination or violation would not reasonably be expected to have a Material Adverse Effect.

 

(xxv)                    No Extension of Credit .  The Company has not, directly or indirectly, including through a Subsidiary, extended credit, arranged to extend credit, or renewed any extension of credit, in the form of a personal loan, to or for any director or executive officer of the Company.

 

(xxvi)                 Accounting Controls .  The Company has established and maintains an effective system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; and (C) access to assets is permitted only in accordance with management’s authorization.

 

(xxvii)              Disclosure Controls .  The Company has established and employs effective disclosure controls and procedures that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the 1934 Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including its principal executive officer or officers and principal financial officer or officers, as appropriate to allow timely decisions regarding disclosure.

 

(xxviii)           Tax Returns .  The Company and the Subsidiaries have filed all federal, state, local and foreign tax returns that are required to have been filed by them pursuant to applicable foreign, federal, state, local or other law or have duly requested extensions thereof, except insofar as the failure to file such returns or request such extensions would not reasonably be expected to result in a Material Adverse Effect, and have paid all taxes shown as due pursuant to such returns

 


 

or pursuant to any assessment received by the Company and the Subsidiaries, except for such taxes or assessments, if any, as are being contested in good faith and as to which adequate reserves have been provided or where the failure to pay would not reasonably be expected to result in a Material Adverse Effect.

 

(xxix)                 No Unlawful Payments .  Neither the Company nor the Subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of the Subsidiaries has (A) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity, (B) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds, (C) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended or (D) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

 

(xxx)                    Compliance with Anti-Money Laundering Laws .  The operations of the Company and the Subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended (the “CFTRA”), and the applicable money laundering statutes of all other jurisdictions having jurisdiction over the Company or any of the Subsidiaries, the applicable rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any other governmental agency having jurisdiction over the Company or any of the Subsidiaries (collectively, the “Other Anti-Money Laundering Laws”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of the Subsidiaries with respect to the CFTRA or Other Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

(xxxi)                 No Conflicts with Sanctions Laws .  None of the Company, the Subsidiaries or, to the knowledge of the Company, any of their respective directors, officers, agents, employees or affiliates is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the United Nations Security Council, the European Union or Her Majesty’s Treasury (collectively, “Sanctions”); and the Company will not, directly or indirectly, use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund any activities of or business with any person that, at the time of such funding, is the subject of Sanctions, (ii) to fund any activities of or business in Cuba, Iran, North Korea, Sudan, Syria or the Crimea region of Ukraine or (iii) in any other manner that will result in a violation by any person of Sanctions.

 

(xxxii)              Sarbanes-Oxley Act .  Except as disclosed in the General Disclosure Package, the Company is, and to the knowledge of the Company, the Company’s directors and officers, in their capacities as such, are, in compliance in all material respects with any applicable provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications.

 

(xxxiii)           Cybersecurity . (A) The Company is not aware of any security breach or incident, unauthorized access or disclosure, or other compromise relating to the Adviser’s information technology and computer systems, data and databases used by the Company (collectively, “IT Systems and Data”) except in each case as would not reasonably expected to, individually or in the aggregate, have a Material Adverse Effect, and (B) to the Company’s knowledge, the Adviser has implemented appropriate controls, policies, procedures, and technological safeguards to

 


 

maintain and protect the integrity, continuous operation, redundancy and security of its IT Systems and Data reasonably consistent with in all material respects with industry standards and practices, or as required by applicable regulatory standards. To the Company’s knowledge, the Adviser is presently in material compliance with all applicable laws and regulations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification.

 

(b)                                  Representations and Warranties of the Adviser and the Administrator .  The Adviser and the Administrator, jointly and severally, represent to each Underwriter as of the date hereof, as of the Applicable Time, as of the Closing Time referred to in Section 2(c) hereof, and as of each Date of Delivery (if any) referred to in Section 2(b) hereof, and agree with each Underwriter as follows:

 

(i)                                      No Material Adverse Change in Business .  Since the respective dates as of which information is given in the Registration Statement, the General Disclosure Package and the Prospectus, except as otherwise stated therein, there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs, business prospects or regulatory status of the Adviser or the Administrator, whether or not arising in the ordinary course of business, that would reasonably be expected to result in a Material Adverse Effect.

 

(ii)                                   Good Standing .  Each of the Adviser and the Administrator has been duly organized and is validly existing as a limited liability company in good standing under the laws of the State of Delaware, and has limited liability company power and authority to own, lease and operate its properties and to conduct its business as described in the General Disclosure Package and the Prospectus and to enter into and perform its obligations under this Agreement; the Adviser has limited liability company power and authority to execute and deliver and perform its obligations under the Investment Advisory Agreement; the Administrator has limited liability company power and authority to enter into and perform its obligations under the Administration Agreement; and each of the Adviser and the Administrator is duly qualified to transact business as a foreign entity and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of ownership or leasing of its property or the conduct of business, except where the failure to qualify or be in good standing would not otherwise reasonably be expected to result in a Material Adverse Effect.

 

(iii)                                Registration Under Advisers Act .  The Adviser is duly registered with the Commission as an investment adviser under the Advisers Act and is not prohibited by the Advisers Act or the 1940 Act from acting under the Investment Advisory Agreement for the Company as contemplated by the General Disclosure Package and the Prospectus. There does not exist any proceeding or, to the Adviser’s knowledge, any facts or circumstances the existence of which could lead to any proceeding which might adversely affect the registration of the Adviser with the Commission.

 

(iv)                               Absence of Proceedings .  There is no action, suit or proceeding or, to the knowledge of the Adviser or the Administrator, inquiry or investigation before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Adviser or the Administrator, threatened, against or affecting either the Adviser or the Administrator, which is required to be disclosed in the General Disclosure Package (other than as disclosed therein), or which would reasonably be expected to result in a Material Adverse Effect, or which would reasonably be expected to materially and adversely affect the consummation of the transactions contemplated in this Agreement, the Indenture, the Securities, the Investment Advisory Agreement or the Administration Agreement; the aggregate of all pending legal or governmental proceedings to which the Adviser or the Administrator is a party or of which any of

 


 

their respective property or assets is the subject which are not described in the General Disclosure Package, including ordinary routine litigation incidental to their business, would not reasonably be expected to result in a Material Adverse Effect.

 

(v)                                  Absence of Defaults and Conflicts .  Neither the Adviser nor the Administrator is in violation of its limited liability company operating agreement or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Adviser or the Administrator is a party or by which it or any of them may be bound, or to which any of the property or assets of the Adviser or the Administrator is subject (collectively, the “Adviser/Administrator Agreements and Instruments”), or in violation of any law, statute, rule, regulation, judgment, order or decree except for such violations or defaults that would not reasonably be expected to result in a Material Adverse Effect; and the execution, delivery and performance of this Agreement, the Investment Advisory Agreement and the Administration Agreement and the consummation of the transactions contemplated herein and therein and in the Registration Statement, the General Disclosure Package and the Prospectus (including the issuance and sale of the Underwritten Securities [and, if applicable, the issuance of shares of Common Stock upon conversion of the Securities] and the use of the proceeds from the sale of the Underwritten Securities as described in the General Disclosure Package and the Prospectus under the caption “Use of Proceeds”) and compliance by the Adviser and the Administrator with their respective obligations hereunder and under the Investment Advisory Agreement and the Administration Agreement do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Adviser or the Administrator pursuant to, the Adviser/Administrator Agreements and Instruments except for such violations or defaults that would not reasonably be expected to result in a Material Adverse Effect, nor will such action result in any violation of the provisions of the limited liability company operating agreement of the Adviser or Administrator, respectively, or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Adviser or the Administrator or any of their assets, properties or operations.

 

(vi)                               Authorization of Agreements .  This Agreement, the Investment Advisory Agreement and the Administration Agreement have been duly authorized, executed and delivered by the Adviser and the Administrator, as applicable.  This Agreement, the Investment Advisory Agreement and the Administration Agreement are valid and binding obligations of the Adviser or the Administrator, as applicable, enforceable against them in accordance with their terms, except as the enforcement thereof may be subject to (i) bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and (ii) general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(vii)                            Absence of Further Requirements .  No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Adviser or the Administrator of their obligations hereunder, in connection with the offering, issuance or sale of the Underwritten Securities hereunder [and, if applicable, the issuance of shares of Common Stock upon conversion of the Securities] or the consummation of the transactions contemplated by this Agreement, the Indenture, the Investment Advisory Agreement, the Administration Agreement, the DTC Agreement, the General Disclosure Package or the Prospectus (including the use of the proceeds from the sale of the Underwritten Securities as described in the General

 


 

Disclosure Package and the Prospectus under the caption “Use of Proceeds”), except (A) such as have been already obtained under the 1933 Act, the 1933 Act Regulations or the 1940 Act, (B) such as may be required under state securities laws and (C) the filing of the Notification of Election under the 1940 Act, which has been effected.

 

(viii)                         Description of Adviser and Administrator . The description of the Adviser and the Administrator contained in the General Disclosure Package and the Prospectus does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.

 

(ix)                               Possession of Licenses and Permits .  The Adviser and the Administrator possess such Governmental Licenses issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them, except where the failure so to possess would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; the Adviser and the Administrator are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not, singly or in the aggregate, result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, result in a Material Adverse Effect; and neither the Adviser nor the Administrator has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

 

(x)                                  Stabilization and Manipulation . Neither the Adviser, the Administrator nor any of their respective partners, officers, affiliates or controlling persons has taken, directly or indirectly, any action designed, under the 1934 Act, to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale of the Underwritten Securities in violation of any law, statute, regulation or rule applicable to the Adviser, the Administrator or any of their respective partners, officers, affiliates or controlling persons.

 

(xi)                               Employment Status . The Adviser is not aware that (A) any executive, key employee or significant group of employees of the Company, if any, any of the Subsidiaries, the Adviser or the Administrator, as applicable, plans to terminate employment with the Company, any of the Subsidiaries, the Adviser or the Administrator or (B) any such executive or key employee is subject to any non-compete, nondisclosure, confidentiality, employment, consulting or similar agreement that would be violated by the present or proposed business activities of the Company, the Subsidiaries or the Adviser except where such termination or violation would not reasonably be expected to have a Material Adverse Effect.

 

(xii)                            Internal Controls .  The Adviser is using its commercially reasonable efforts to operate a system of internal controls sufficient to provide reasonable assurance that (A) transactions effectuated by it under the Investment Advisory Agreement are executed in accordance with its management’s general or specific authorization; and (B) access to the Company’s assets that are in its possession or control is permitted only in accordance with its management’s general or specific authorization.

 

(xiii)                         Accounting Controls .  The Administrator is using its commercially reasonable efforts to operate a system of internal accounting controls sufficient to provide reasonable assurance that (A) transactions for which it has bookkeeping and record keeping responsibility for under the Administration Agreement are recorded as necessary to permit preparation of the

 


 

Company’s financial statements in conformity with GAAP and to maintain financial statements in conformity with GAAP and to maintain accountability for the Company’s assets and (B) the recorded accountability for such assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

 

(c)                                   Officer’s Certificates.   Any certificate signed by any officer of the Company, any of the Subsidiaries, the Adviser or the Administrator delivered to the Representatives or to counsel for the Underwriters shall be deemed a representation and warranty by the Company, such Subsidiary, the Adviser and/or the Administrator, as applicable, to each Underwriter as to the matters covered thereby.

 

SECTION 2.                             Sale and Delivery to Underwriters; Closing .

 

(a)                                  Initial Securities.   On the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company agrees to sell to each Underwriter, severally and not jointly, and each Underwriter, severally and not jointly, agrees to purchase from the Company, at the price set forth in Schedule B (the “Purchase Price”), the aggregate principal amount of Initial Securities set forth in Schedule A opposite the name of such Underwriter, plus any additional aggregate principal amount of Initial Securities which such Underwriter may become obligated to purchase pursuant to the provisions of Section 10 hereof.

 

(b)                                  Option Securities.   In addition, on the basis of the representations and warranties herein contained and subject to the terms and conditions herein set forth, the Company hereby grants an option to the Underwriters, severally and not jointly, to purchase up to an additional $ · aggregate principal amount of Securities at the Purchase Price plus accrued interest from the Closing Time to the relevant Date of Delivery.  The option hereby granted will expire 30 days after the date hereof and may be exercised in whole or in part from time to time on one or more occasions only for the purpose of covering overallotments which may be made in connection with the offering and distribution of the Initial Securities upon notice by the Representatives to the Company setting forth the aggregate principal amount of Option Securities as to which the several Underwriters are then exercising the option and the time and date of payment and delivery for such Option Securities.  Any such time and date of delivery (a “Date of Delivery”) shall be determined by the Representatives, but shall not be later than seven full business days after the exercise of said option, nor in any event prior to the Closing Time, as hereinafter defined.  Any such notice shall be given at least one business day prior to the Date of Delivery.  If the option is exercised as to all or any portion of the Option Securities, each of the Underwriters, acting severally and not jointly, will purchase that proportion of the aggregate principal amount of Option Securities then being purchased which the aggregate principal amount of Initial Securities set forth in Schedule A opposite the name of such Underwriter bears to the total aggregate principal amount of Initial Securities.

 

(c)                                   Payment.   Payment of the purchase price for, and delivery of, the Initial Securities shall be made at the offices of [               ] or at such other place as shall be agreed upon by the Representatives and the Company, at 9:00 A.M. (Eastern time) on the second (third, if the pricing occurs after 4:30 P.M. (Eastern time) on any given day) business day after the date hereof (unless postponed in accordance with the provisions of Section 10), or such other time not later than ten business days after such date as shall be agreed upon by the Representatives and the Company (such time and date of payment and delivery being herein called “Closing Time”).

 

In addition, in the event that any or all of the Option Securities are purchased by the Underwriters, payment of the purchase price for, and delivery of, such Option Securities shall be made at the above-mentioned offices, or at such other place as shall be agreed upon by the Representatives and the Company, on each Date of Delivery as specified in the notice from the Representatives to the Company.

 


 

Payment shall be made to the Company by wire transfer of immediately available funds to a bank account designated by the Company, against delivery to the Representatives through the facilities of DTC  for the respective accounts of the Underwriters of the Underwritten Securities to be purchased by them.  It is understood that each Underwriter has authorized the Representatives, for its account, to accept delivery of, receipt for, and make payment of the purchase price for, the Initial Securities and the Option Securities, if any, which it has agreed to purchase.  The Representatives, individually and not as representatives of the Underwriters, may (but shall not be obligated to) make payment of the purchase price for the Initial Securities or the Option Securities, if any, to be purchased by any Underwriter whose funds have not been received by the Closing Time or the relevant Date of Delivery, as the case may be, but such payment shall not relieve such Underwriter from its obligations hereunder.

 

(d)                                  Denominations; Registration.   The Initial Securities and the Option Securities, if any, shall be transferred electronically at the Closing Time or the relevant Date of Delivery, as the case may be, in such denominations and registered in such names as the Representatives may request; provided that any such request must be received in writing at least one full business day before the Closing Time or the relevant Date of Delivery, as the case may be.

 

SECTION 3.                             Covenants of the Company .  The Company covenants with each Underwriter as follows:

 

(a)                                  Compliance with Securities Regulations and Commission Requests.   During any period that a prospectus relating to the Underwritten Securities is required to be delivered under the 1933 Act (but in any event through the Closing Time [and, if any Option Securities are purchased, through the relevant Date of Delivery]), the Company, subject to Section 3(b), will comply with the requirements of Rule 415, Rule 430C and Rule 497 and will notify the Representatives immediately, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective, or any supplement to the Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission relating to the Registration Statement, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information, and (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any preliminary prospectus, or of the suspension of the qualification of the Underwritten Securities for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes.  The Company will promptly effect the filings necessary pursuant to Rule 497 and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 497 was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus.  During any period that a prospectus relating to the Underwritten Securities is required to be delivered under the 1933 Act (but in any event through the Closing Time [and, if any Option Securities are purchased, through the relevant Date of Delivery]), the Company will use its reasonable efforts to prevent the issuance of any stop order and, if any stop order is issued, to obtain the lifting thereof at the earliest possible moment.

 

(b)                                  Filing of Amendments.   During any period that a prospectus relating to the Underwritten Securities is required to be delivered under the 1933 Act (but in any event through the Closing Time [and, if any Option Securities are purchased, through the relevant Date of Delivery]), the Company will give the Representatives notice of its intention to file or prepare any amendment to the Registration Statement (including any filing under Rule 462(b)) or any amendment, supplement or revision to any preliminary prospectus (including any prospectus included in the Registration Statement at the time it became effective) or to the Prospectus, will furnish the Representatives with copies of any such documents a reasonable amount of time prior to such proposed filing or use, as the case may be, and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object. 

 


 

The Company has given the Underwriters notice of any filings made pursuant to the 1934 Act or the rules and regulations adopted thereunder within 48 hours prior to the Applicable Time; the Company will give the Underwriters notice of its intention to make any such filing from the Applicable Time to the Closing Time [and, if any Option Securities are purchased, through the relevant Date of Delivery] and will furnish the Underwriters with copies of any such documents a reasonable amount of time prior to such proposed filing.

 

(c)                                   Delivery of Commission Filings.   Upon the Representatives’ written request, the Company will deliver to the Representatives, without charge, conformed copies of the Registration Statement as originally filed, and of each amendment thereto (including exhibits filed therewith or incorporated by reference therein) and conformed copies of all consents and certificates of experts, and, upon the Representatives’ request, will also deliver to the Representatives, without charge, a conformed copy of the Registration Statement as originally filed and of each amendment thereto (without exhibits) for each of the Underwriters.  The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T, or as filed with the Commission in paper form as permitted by Regulation S-T.

 

(d)                                  Delivery of Prospectuses.   The Company has delivered to each Underwriter, without charge, as many copies of each preliminary prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the 1933 Act.  The Company will furnish to each Underwriter, without charge, during the period when the Prospectus is required to be delivered under the 1933 Act, such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may reasonably request.  The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

 

(e)                                   Continued Compliance with Securities Laws.   The Company will use its commercially reasonable efforts to comply with the 1933 Act and the 1933 Act Regulations so as to permit the completion of the distribution of the Underwritten Securities as contemplated in this Agreement and in the Prospectus.  If at any time when a prospectus is required by the 1933 Act to be delivered in connection with sales of the Underwritten Securities, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to amend the Registration Statement or amend or supplement the Prospectus in order that the Prospectus will not include any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, or if it shall be necessary, in the opinion of such counsel, at any such time to amend the Registration Statement or amend or supplement the Prospectus in order to comply with the requirements of the 1933 Act or the 1933 Act Regulations, the Company will promptly prepare and file with the Commission, subject to Section 3(b), such amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus comply with such requirements, and the Company will furnish to the Underwriters such number of copies of such amendment or supplement as the Underwriters may reasonably request.

 

(f)                                    Blue Sky Qualifications.   The Company will use its commercially reasonable efforts, in cooperation with the Underwriters, to qualify the Underwritten Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Representatives may designate and to maintain such qualifications in effect for as long as the Representatives reasonably request; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

 


 

(g)                                   Rule 158.   The Company will timely file such reports pursuant to the 1934 Act as are necessary in order to make generally available to its securityholders as soon as reasonably practicable an earnings statement for the purposes of, and to provide the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.

 

(h)                                  DTC .  The Company will cooperate with the Representatives and use its commercially reasonable efforts to permit the offered Securities to be eligible for clearance and settlement through the facilities of DTC.

 

(i)                                      [ Reservation of Shares of Common Stock .  The Company will reserve and keep available at all times, free of preemptive rights, shares of Common Stock for the purpose of enabling the Company to satisfy all obligations to issue shares of Common Stock upon conversion of the Securities.]

 

(j)                                     Use of Proceeds.   The Company will use the net proceeds received by it from the sale of the Underwritten Securities in the manner specified in the General Disclosure Package and in the Prospectus under “Use of Proceeds”.

 

(k)                                  [ Listing.   The Company will use its commercially reasonable efforts to effect and maintain the listing of [if applicable, describe Securities] on [describe applicable stock exchange or quotation service].]

 

(l)                                      [Restriction on Sale of Common Stock. [During a period of · days from the date of the Prospectus, the Company will not, and will not publicly disclose the intention to, without the prior written consent of the Representatives, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any shares of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or file any registration statement under the 1933 Act with respect to any of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Common Stock, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise. The foregoing sentence shall not apply to (A) the registration and sale of Securities to be sold hereunder, (B) the issuance of any shares of Common Stock issued by the Company upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof and referred to in the Prospectus, and any registration related thereto, (C) any shares of Common Stock issued or options to purchase Common Stock granted pursuant to existing dividend reinvestment plans or employee benefit plans of the Company referred to in the Prospectus, and any registration related thereto, (D) any shares of Common Stock issued pursuant to any non-employee director stock plan or dividend reinvestment plan, and any registration related thereto, (E) any shares of Common Stock issued to directors in lieu of directors’ fees, and any registration related thereto, (F) any post-effective amendment to the Registration Statement filed solely to add exhibits to the Registration Statement and which post-effective amendment becomes effective immediately upon filing with the Commission in accordance with Rule 462(d) under the 1933 Act, or [(G) the issuance by the Company of any shares of Common Stock as consideration for any strategic acquisitions, provided, that (i) such issuance would not result in the issuance of shares in an amount greater than 5% of the Company’s then outstanding shares of Common Stock, (ii) the Company does not file a registration statement with respect to such shares prior to the expiration of the period set forth in this subsection ([l]) and (iii) the Representatives receive a signed lock-up agreement for the balance of the period set forth in this subsection ([l]) from each recipient of shares of Common Stock issued in connection with such an acquisition under this clause (G).]

 


 

(m)                              Restriction on Sale of Underwritten Securities.   During a period of · days from the date of the Prospectus, the Company will not, without the prior written consent of the Representatives, (i) directly or indirectly, offer, pledge, sell, contract to sell, grant any option for the sale of otherwise transfer or dispose of any debt securities issued or guaranteed by the Company or any securities convertible into or exercisable or exchangeable for debt securities issued or guaranteed by the Company or file any registration statement under the 1933 Act with respect to any of the foregoing. The foregoing sentence shall not apply to (A) the registration and sale of Underwritten Securities to be sold hereunder or (B) any post-effective amendment to the Registration Statement filed solely to add exhibits to the Registration Statement and which post-effective amendment becomes effective immediately upon filing with the Commission in accordance with Rule 462(d) under the 1933 Act.

 

(n)                                  Reporting Requirements.   The Company, during the period when the Prospectus is required to be delivered under the 1933 Act, will file all documents required to be filed with the Commission pursuant to the 1934 Act within the time periods required by the 1934 Act and the rules and regulations of the Commission thereunder.

 

(o)                                  Business Development Company Status .  The Company, during a period of at least 12 months from the Closing Time, will use its commercially reasonable efforts to maintain its status as a business development company; provided , however , the Company may cease to be, or withdraw its election as, a business development company, with the approval of the board of directors and a vote of stockholders as required by Section 58 of the 1940 Act or any successor provision.

 

(p)                                  Regulated Investment Company Status .  During the 12-month period following the Closing Time, the Company will use its commercially reasonable efforts to qualify and elect to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”) and to maintain such qualification and election in effect for each full fiscal year during which it is a business development company under the 1940 Act.

 

(q)                                  Accounting Controls.  The Company will use its commercially reasonable efforts to maintain a system of internal accounting controls sufficient to provide reasonable assurances that (A) material information relating to the Company and the assets managed by the Adviser is promptly made known to the officers responsible for establishing and maintaining the system of internal accounting controls; and (B) any significant deficiencies or weaknesses in the design or operation of internal accounting controls which could adversely affect the Company’s ability to record, process, summarize and report financial data, and any fraud whether or not material that involves management or other employees who have a significant role in internal controls, are adequately and promptly disclosed to the Company’s independent auditors and the audit committee of the Company’s board of directors.

 

(r)                                     Marketing Materials .  Before using, authorizing, approving or referring to any Marketing Materials, the Company will furnish to the Representatives and counsel for the Underwriters a copy of such materials for review and will not use, authorize, approve or refer to any such materials to which the Representatives or the counsel for the Underwriters reasonably object.

 


 

SECTION 4.                             Payment of Expenses .

 

(a)                                  Expenses.   The Company will pay all expenses incident to the performance of its obligations under this Agreement, including (i) the preparation, printing and filing of the Registration Statement (including financial statements and exhibits) as originally filed and of each amendment thereto, (ii) the printing and delivery to the Underwriters of this Agreement, the Indenture, the DTC Agreement, the Warrant Agreement, if any, any Agreement among the Underwriters and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the Underwritten Securities, (iii) the preparation, issuance and delivery of the certificates for the Underwritten Securities and any Warrant Securities issuable upon exercise of the Debt Warrants to the Underwriters, including any stock or other transfer taxes and any stamp or other duties payable upon the sale, issuance or delivery of the Underwritten Securities and any Warrant Securities to the Underwriters, (iv) the fees and disbursements of the Company’s, the Adviser’s and the Administrator’s counsel, accountants and other advisors, (v) the qualification of the Underwritten Securities and any Warrant Securities issuable upon exercise of the Debt Warrants under securities laws in accordance with the provisions of Section 3(f) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Underwriters in connection therewith and in connection with the preparation of the Blue Sky Survey and any supplement thereto, (vi) the printing and delivery to the Underwriters of copies of each preliminary prospectus and of the Prospectus and any amendments or supplements thereto, (vii) the preparation, printing and delivery to the Underwriters of copies of the Blue Sky Survey and any supplement thereto, (viii) the fees and expenses of the trustee with respect to the Underwritten Securities and any transfer agent or registrar for the Underwritten Securities, [(ix) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing of the Underwritten Securities, including without limitation, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations, travel and lodging expenses of the representatives and officers of the Company and any such consultants, and 50% of the cost of aircraft and other transportation chartered in connection with the road show,] (x) the filing fees incident to, and the reasonable fees and disbursements of counsel to the Underwriters in connection with, the review by the Financial Industry Regulatory Authority (“FINRA”) of the terms of the sale of the Underwritten Securities, (xi) the fees and expenses incurred in connection with the inclusion of the Underwritten Securities or any Warrant Securities, if applicable, in [describe applicable stock exchange or quotation service] and (xii) the costs and expenses (including without limitation any damages or other amounts payable in connection with legal or contractual liability) associated with the reforming of any contracts for sale of the Underwritten Securities made by the Underwriters (which are terminated prior to the Closing Time) caused by a breach of the representation contained in the fourth paragraph of Section 1(a)(i). [In the event there are any road show or marketing expenses, the Underwriters will pay their own expenses and the Company will pay its own expenses.]

 

(b)                                  Termination of Agreement.   If this Agreement is terminated by the Representatives in accordance with the provisions of Section 5 or Section 9(a)(i) and (iii) hereof, the Company shall reimburse the Underwriters for all of their out-of-pocket expenses incurred, including the reasonable fees and disbursements of counsel for the Underwriters.

 

SECTION 5.                             Conditions of Underwriters’ Obligations .  The obligations of the several Underwriters hereunder are subject to the accuracy of the representations and warranties of the Company, the Adviser and the Administrator contained in Section 1 hereof or in certificates of any officer of the Company, the Adviser or the Administrator, to the performance by the Company, the Adviser and the Administrator of their respective covenants and other obligations hereunder, and to the following further conditions:

 

(a)                                  Effectiveness of Registration Statement.   The Registration Statement, including any Rule 462(b) Registration Statement, has become effective and at Closing Time no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriters.  A final prospectus containing the Rule 430C Information shall have been filed with the Commission in accordance with Rule 497.

 


 

(b)                                  Opinions of Counsel for Company.   At Closing Time, the Representatives shall have received the favorable opinion, dated as of Closing Time, of Kirkland & Ellis LLP, counsel for the Company, Eversheds Sutherland (US) LLP, special regulatory counsel for the Company, and Venable LLP, special Maryland counsel for the Company, in each case in form and substance reasonably satisfactory to counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters, to the effect set forth in Exhibits A through C hereto.  Such counsel may state that, insofar as such opinion involves factual matters, they have relied upon certificates of officers of the Company and/or any of the Subsidiaries and certificates of public officials.

 

(c)                                   Opinion of Counsel for Underwriters.   At Closing Time, the Representatives shall have received the favorable opinion, dated as of Closing Time, of [               ], counsel for the Underwriters, together with signed or reproduced copies of such letter for each of the other Underwriters.  In giving such opinion such counsel may rely, as to all matters governed by the laws of jurisdictions other than the law of the State of New York and the federal law of the United States upon the opinions of counsel reasonably satisfactory to the Representatives, including counsel of the Company.  Such counsel may also state that, insofar as such opinion involves factual matters, they have relied, to the extent they deem proper, upon certificates of officers of the Company and/or any of the Subsidiaries and certificates of public officials.

 

(d)                                  Officers’ Certificates.   (i) At Closing Time, there shall not have been, since the date hereof or since the respective dates as of which information is given in the Prospectus or the General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and the Subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, and the Representatives shall have received a certificate of the chief executive officer or president of the Company and of the chief financial or chief accounting officer of the Company, dated as of Closing Time, to the effect that (A) there has been no such material adverse change, (B) the representations and warranties in Section 1(a) hereof are true and correct with the same force and effect as though expressly made at and as of Closing Time, (C) the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied at or prior to Closing Time and (D) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to their knowledge, contemplated by the Commission.

 

(ii)                                   At Closing Time, there shall not have been, since the date hereof or since the respective dates as of which information is given in the Prospectus or the General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs, business prospects or regulatory status of the Adviser or the Administrator, whether or not arising in the ordinary course of business, that would reasonably be expected to result in a Material Adverse Effect (collectively, with respect to each of the Adviser and the Administrator, an “Advisers Material Adverse Effect”), and the Representatives shall have received a certificate of a vice president (or other authorized officer) and the chief financial or chief accounting officer (or other authorized officer) of each of the Adviser and the Administrator, dated as of Closing Time, to the effect that (A) there has been no such Advisers Material Adverse Effect, (B) the representations and warranties of the Adviser and Administrator in Sections 1(a) and 1(b) hereof are true and correct with the same force and effect as though expressly made at and as of Closing Time, (C) the Adviser and the Administrator have complied with all agreements and satisfied all conditions on their part to be performed or satisfied at or prior to Closing Time and (D) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or, to their knowledge, contemplated by the Commission.

 


 

(e)                                   Accountant’s Comfort Letter and CFO Certificate.   At the time of the execution of this Agreement the Representatives shall have received:

 

(i)                                      A letter from KPMG LLP, independent public accountants for the Company, in form and substance reasonably satisfactory to the Representatives, covering the financial information in the Registration Statement, the General Disclosure Package and the Prospectus of the Company, together with signed or reproduced copies of such letter for each of the other Underwriters, containing statements and information of the type ordinarily included in accountants’ “comfort letters” to underwriters with respect to the financial statements and certain financial information contained in the Registration Statement and the Prospectus.

 

(ii)                                   A certificate of the chief financial officer of the Company, in form and substance reasonably satisfactory to the Representatives and as agreed upon prior to the date hereof, covering certain financial matters of the Company, together with signed or reproduced copies of such certificate for each of the other Underwriters.

 

(f)                                    Bring-down Comfort Letter and CFO Certificate .  At Closing Time, the Representatives shall have received (i) from KPMG LLP, independent public accountants for the Company, a letter, dated as of Closing Time, to the effect that they reaffirm the statements made in the letter furnished pursuant to subsection (e)(i) of this Section, except that the specified date referred to shall be a date not more than three business days prior to Closing Time and (ii) from the Company a certificate of the chief financial officer of the Company, dated as of the Closing Time, to the effect that the chief financial officer of the Company reaffirms the statements made in the certificate furnished pursuant to subsection (e)(ii) of this Section.

 

(g)                                   No Objection.   FINRA has confirmed that it has not raised any objection with respect to the fairness and reasonableness of the underwriting terms and arrangements.

 

(h)                                  [ Approval of Listing.   At Closing Time, the [if applicable, describe Securities] shall have been approved for inclusion in [describe applicable stock exchange or quotation service], subject only to official notice of issuance.]

 

(i)                                      Indenture .  At or prior to the Closing Time, the Company and the Trustee shall have executed and delivered the Indenture (including the Supplemental Indenture).

 

(j)                                     [ Lock-up Agreements.   At the date of this Agreement, the Representatives shall have received an agreement substantially in the form of Exhibit D hereto signed by the persons listed on Schedule E hereto.  Notwithstanding the foregoing or any provision of Section 3(l) or (m) of this Agreement or any lock-up agreement delivered in connection with this Section 5(j) to the contrary, Ares Management Corporation and its controlled affiliates (collectively, “Ares”) may pledge shares of Common Stock of the Company owned by Ares in one or more bona fide lending transactions.]

 

(k)                                  [ Ratings . At the Closing Time, the Underwritten Securities shall be rated at least     by       and since the execution of this Agreement, there shall not have been any decrease in the rating of any debt or preferred stock of the Company or any Subsidiary by any “nationally recognized statistical rating organization” (as defined in Section 3(a)(62) of the 1934 Act), or any notice given of any intended or potential decrease in any such rating or of a possible change in any such rating that does not indicate  the direction of the possible change, and no such organization shall have publicly announced it has under surveillance or review any such rating.]

 


 

(l)                                      Conditions to Purchase of Option Securities.   In the event that the Underwriters exercise their option provided in Section 2(b) hereof to purchase all or any portion of the Option Securities, (x) the representations and warranties of the Company, the Adviser and the Administrator contained herein and the statements in any certificates furnished by the Company, the Adviser and the Administrator hereunder shall be true and correct as of each Date of Delivery, (y) as of each Date of Delivery, no stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Underwriters, and (z) at the relevant Date of Delivery, the Representatives shall have received:

 

(i)                                      Officers’ Certificates .

 

(A)                                A certificate, dated such Date of Delivery, of the chief executive officer or president of the Company and of the chief financial or chief accounting officer of the Company confirming that the certificate delivered at the Closing Time pursuant to Section 5(d)(i) hereof remains true and correct as of such Date of Delivery.

 

(B)                                A certificate, dated such Date of Delivery, of a vice president (or other authorized officer) and the chief financial or chief accounting officers (or other authorized officer) of each of the Adviser and the Administrator confirming that the certificates delivered at the Closing Time pursuant to Section 5(d)(ii) hereof remain true and correct as of such Date of Delivery.

 

(ii)                                   Opinions of Counsel for Company .  The favorable opinions of Kirkland & Ellis LLP, counsel for the Company, Eversheds Sutherland (US) LLP, special regulatory counsel for the Company, and Venable LLP, special Maryland counsel for the Company, in each case in form and substance reasonably satisfactory to the Representatives, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinions required by Section 5(b) hereof.

 

(iii)                                Opinion of Counsel for Underwriters .  The favorable opinion of [               ], counsel for the Underwriters, dated such Date of Delivery, relating to the Option Securities to be purchased on such Date of Delivery and otherwise to the same effect as the opinion required by Section 5(c) hereof.

 

(iv)                               Bring-down Comfort Letter and CFO Certificate .

 

(A)                                A letter from KPMG LLP, independent public accountants for the Company, in form and substance reasonably satisfactory to the Representatives and dated such Date of Delivery, substantially in the same form and substance as the letter furnished to the Representatives pursuant to Section 5(f)(i) hereof, except that the “specified date” in the letter furnished pursuant to this paragraph shall be a date not more than five days prior to such Date of Delivery.

 

(B)                                A certificate, in form and substance reasonably satisfactory to the Representatives and dated such Date of Delivery, substantially in the same form and substance as the certificate furnished to the Representatives pursuant to Section 5(f)(ii) hereof.

 


 

(m)                              Additional Documents.   At Closing Time and at each Date of Delivery, counsel for the Underwriters shall have been furnished with such documents as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Underwritten Securities as herein contemplated, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company, the Adviser and the Administrator in connection with the issuance and sale of the Underwritten Securities as herein contemplated shall be reasonably satisfactory in form and substance to the Representatives and counsel for the Underwriters.

 

(n)                                  Termination of Agreement.   If any condition specified in this Section shall not have been fulfilled when and as required to be fulfilled, this Agreement, or, in the case of any condition to the purchase of Option Securities, on a Date of Delivery which is after the Closing Time, the obligations of the several Underwriters to purchase the relevant Option Securities, may be terminated by the Representatives by notice to the Company at any time at or prior to Closing Time or such Date of Delivery, as the case may be, and such termination shall be without liability of any party to any other party except as provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any such termination and remain in full force and effect.

 

SECTION 6.                             Indemnification .

 

(a)                                  (1)   Indemnification of Underwriters by the Company and the Adviser.   The Company and the Adviser, jointly and severally, agree to indemnify and hold harmless each Underwriter, its affiliates, as such term is defined in Rule 501(b) under the 1933 Act (each, an “Affiliate”), its selling agents and each person, if any, who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:

 

(i)                                      against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including the Rule 430C Information (including the information on Schedule B hereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or the Marketing Materials, or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;

 

(ii)                                   against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Company;

 

(iii)                                against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Representatives), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above;

 


 

provided , however , that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials.

 

(2)   Indemnification of Underwriters by the Administrator.   The Administrator agrees to indemnify and hold harmless each Underwriter, its Affiliates, its selling agents and each person, if any, who controls any Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:

 

(i)                                      against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), including the Rule 430C Information (including the information on Schedule B hereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or in the Marketing Materials, or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading to the extent the loss, liability, claim, damage and expense relates to information concerning the Administrator;

 

(ii)                                   against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission related to the Administrator or any such alleged untrue statement or omission related to the Administrator; provided that (subject to Section 6(d) below) any such settlement is effected with the written consent of the Company;

 

(iii)                                against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Representatives), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission related to the Administrator, or any such alleged untrue statement or omission related to the Administrator, to the extent that any such expense is not paid under (i) or (ii) above;

 

provided , however , that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), the General Disclosure Package or the Marketing Materials.

 


 

(b)                                  Indemnification of Company, Directors, Officers, Adviser and Administrator.   Each Underwriter severally agrees to indemnify and hold harmless the Company, its directors, each of its officers, each person, if any, who controls the Company, the Adviser or the Administrator within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act, the Adviser and the Administrator against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or the Marketing Materials in reliance upon and in conformity with written information furnished to the Company by such Underwriter through the Representatives expressly for use in the Registration Statement (or any amendment thereto), including the Rule 430C Information, or any preliminary prospectus or the Prospectus (or any amendment or supplement thereto) or in the General Disclosure Package or the Marketing Materials.

 

(c)                                   Actions against Parties; Notification.   Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder (an “Action”), but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement.  In the case of parties indemnified pursuant to Section 6(a)(1) or (2) above, counsel to the indemnified parties shall be selected by the Representatives, and, in the case of parties indemnified pursuant to Section 6(b) above, counsel to the indemnified parties shall be selected by the Company.  An indemnifying party may participate at its own expense in the defense of any such Action; provided , however , that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party.  In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one Action or separate but similar or related Actions in the same jurisdiction arising out of the same general allegations or circumstances.  No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this Section 6 or Section 7 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.  Notwithstanding anything to the contrary herein, neither the assumption of the defense of any such Action nor the payment of any fees or expenses related thereto shall be deemed to be an admission by the indemnifying party that it has an obligation to indemnify any person pursuant to this Agreement.

 

(d)                                  Settlement Without Consent if Failure to Reimburse.   If at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 6(a)(1)(ii) or 6(a)(2)(ii) effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.

 


 

(e)                                   Acknowledgement by the Company, the Adviser and the Administrator .  The Company, the Adviser and the Administrator also acknowledge and agree that (i) the purchase and sale of any Underwritten Securities pursuant to this Agreement, including the determination of the public offering price of the Underwritten Securities and any related discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the Underwriters of such Underwritten Securities, on the other hand, (ii) in connection with the public offering of the Underwritten Securities and the process leading to such transaction the Underwriters will act solely as principals and not as agents or fiduciaries of the Company or its stockholders, creditors, employees or any other party, (iii) the Underwriters will not assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering of Underwritten Securities contemplated hereby or the process leading thereto (irrespective of whether the Underwriters have advised or are currently advising the Company on other matters) and the Underwriters will not have any obligation to the Company with respect to the offering except the obligations expressly set forth herein, (iv) the Underwriters and their affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company, and (v) the Underwriters have not provided and will not provide any legal, accounting, regulatory or tax advice with respect to the offering of the Underwritten Securities and the Company has consulted and will consult its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.

 

SECTION 7.                             Contribution .  If the indemnification provided for in Section 6 hereof is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, the Adviser and the Administrator on the one hand and the Underwriters on the other hand from the offering of the Underwritten Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, the Adviser and the Administrator on the one hand and of the Underwriters on the other hand in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.

 

The relative benefits received by the Company, the Adviser and the Administrator on the one hand and the Underwriters on the other hand in connection with the offering of the Underwritten Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Underwritten Securities pursuant to this Agreement (before deducting expenses) received by the Company and the total underwriting discount received by the Underwriters, in each case as set forth on the cover of the Prospectus, bear to the aggregate initial public offering price of the Underwritten Securities as set forth on the cover of the Prospectus.

 

The relative fault of the Company, the Adviser and the Administrator on the one hand and the Underwriters on the other hand shall be determined by reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company, the Adviser and the Administrator or by the Underwriters and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

The Company, the Adviser, the Administrator and the Underwriters agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 7.  The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred

 


 

to above in this Section 7 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission.

 

Notwithstanding the provisions of this Section 7, no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the Underwritten Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of any such untrue or alleged untrue statement or omission or alleged omission.

 

No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

 

For purposes of this Section 7, each person, if any, who controls an Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and each Underwriter’s Affiliates and selling agents shall have the same rights to contribution as such Underwriter, and each director of the Company, each officer of the Company, and each person, if any, who controls the Company, Adviser or Administrator within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to contribution as the Company, Adviser or Administrator, as the case may be.  The Underwriters’ respective obligations to contribute pursuant to this Section 7 are several in proportion to the aggregate principal amount of Initial Securities set forth opposite their respective names in Schedule A hereto and not joint.

 

Notwithstanding any other provision of Section 6 and this Section 7, no party shall be entitled to indemnification or contribution under this Agreement in violation of Section 17(i) of the 1940 Act.

 

SECTION 8.                             Representations, Warranties and Agreements to Survive .  All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company, any of the Subsidiaries, the Adviser and the Administrator submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter, its officers or directors or any person controlling the Company and (ii) delivery of and payment for the Underwritten Securities.

 

SECTION 9.                             Termination of Agreement .

 

(a)                                  Termination; General.   The Representatives may terminate this Agreement [or, with respect to any Date of Delivery which occurs after the Closing Time, the obligations of the Underwriters to purchase the Option Securities to be purchased and sold on such Date of Delivery], by notice to the Company, at any time at or prior to Closing Time [or such Date of Delivery, as applicable,] (i) if there has been, since the time of execution of this Agreement or since the respective dates as of which information is given in the Prospectus or the General Disclosure Package, any material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and the Subsidiaries considered as one enterprise, the Adviser or the Administrator, whether or not arising in the ordinary course of business, or (ii) if there has occurred any material adverse change in the financial markets in the United States or the international financial markets, any outbreak of hostilities or escalation thereof or other calamity or crisis or any change or development involving a prospective change in national or international political, financial or economic conditions, in each case the effect of which is such as to make it, in the judgment of the Representatives, impracticable or inadvisable to market the Underwritten Securities or to enforce contracts for the sale of the Underwritten Securities, or

 


 

(iii) if trading in any securities of the Company has been suspended or materially limited by the Commission or the Nasdaq Global Select Market or the Nasdaq Global Market or The New York Stock Exchange, or (iv) if trading generally on The New York Stock Exchange, the NYSE American LLC, the Nasdaq Global Market or the Nasdaq Global Select Market has been suspended or materially limited, or minimum or maximum prices for trading have been fixed, or maximum ranges for prices have been required, by any of said exchanges or by such system or by order of the Commission, FINRA or any other governmental authority, or (v) a material disruption has occurred in commercial banking or securities settlement or clearance services in the United States, or (vi) if a banking moratorium has been declared by either Federal or New York authorities.

 

(b)                                  Liabilities.   If this Agreement is terminated pursuant to this Section, such termination shall be without liability of any party to any other party except as provided in Section 4 hereof, and provided further that Sections 1, 6, 7 and 8 shall survive such termination and remain in full force and effect.

 

SECTION 10.                      Default by One or More of the Underwriters .  If one or more of the Underwriters shall fail at Closing Time or a Date of Delivery to purchase the Underwritten Securities which it or they are obligated to purchase under this Agreement (the “Defaulted Securities”), the Representatives shall have the right, within 24 hours thereafter, to make arrangements for one or more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms herein set forth; if, however, the Representatives shall not have completed such arrangements within such 24-hour period, then:

 

(i)                                      if the aggregate principal amount of Defaulted Securities does not exceed 10% of the aggregate principal amount of Securities to be purchased on such date, each of the non-defaulting Underwriters shall be obligated, severally and not jointly, to purchase the full amount thereof in the proportions that their respective underwriting obligations hereunder bear to the underwriting obligations of all non-defaulting Underwriters, or

 

(ii)                                   if the aggregate principal amount of Defaulted Securities exceeds 10% of the aggregate principal amount of Underwritten Securities to be purchased on such date, this Agreement or, with respect to any Date of Delivery which occurs after the Closing Time, the obligations of the Underwriters to purchase and of the Company to sell the Option Securities to be purchased and sold on such Date of Delivery shall terminate without liability on the part of any non-defaulting Underwriter.

 

As used in this Section only, if the Defaulted Securities include Debt Warrants, the aggregate amount or aggregate principal amount of Securities shall mean the aggregate principal amount of any Securities plus the public offering price of any Debt Warrants included in the relevant Securities.

 

No action taken pursuant to this Section shall relieve any defaulting Underwriter from liability in respect of its default.

 

In the event of any such default which does not result in a termination of this Agreement or, in the case of a Date of Delivery which is after the Closing Time, which does not result in a termination of the obligation of the Underwriters to purchase and the Company to sell the relevant Option Securities, as the case may be, either the Representatives or the Company shall have the right to postpone Closing Time or the relevant Date of Delivery, as the case may be, for a period not exceeding seven days in order to effect any required changes in the Registration Statement, the General Disclosure Package or the Prospectus or in any other documents or arrangements.  As used herein, the term “Underwriter” includes any person substituted for an Underwriter under this Section 10.

 


 

SECTION 11.                      Tax Disclosure .  Notwithstanding any other provision of this Agreement, from the commencement of discussions with respect to the transactions contemplated hereby, the Company (and each employee, representative or other agent of the Company) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure (as such terms are used in Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury Regulations promulgated thereunder) of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided relating to such tax treatment and tax structure.

 

SECTION 12.                      Notices .  All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication.  Notices to the Underwriters shall be directed to the Representatives at [               ], with a copy to [               ].  Notices to the Company, the Adviser and Administrator shall be directed to them at 245 Park Avenue, 44 th  Floor, New York, New York 10167, Attention: General Counsel, with a copy to Kirkland & Ellis LLP, 2029 Century Park East, 14th Floor, Los Angeles, CA 90067, Attention: Monica Shilling.

 

SECTION 13.                      Parties .  This Agreement shall each inure to the benefit of and be binding upon the Underwriters and the Company and their respective successors.  Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Underwriters, the Company, the Adviser and the Administrator and their respective successors and the controlling persons and officers and directors referred to in Sections 6 and 7 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained.  This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Underwriters, the Company, the Adviser and the Administrator and their respective successors, and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation.  No purchaser of Underwritten Securities from any Underwriter shall be deemed to be a successor by reason merely of such purchase.

 

SECTION 14.                      Governing Law .  This Agreement shall be governed by and construed in accordance with the laws of the State of New York, including without limitation Section 5-1401 of the New York General Obligations Law.

 

SECTION 15.                      Time .  Time shall be of the essence of this Agreement.  Except as otherwise set forth herein, specified times of day refer to New York City time.

 

SECTION 16.                      Submission to Jurisdiction .  Except as set forth below, no claim or action may be commenced, prosecuted or continued in any court other than the courts of the State of New York located in the City and County of New York or in the United States District Court for the Southern District of New York, which courts shall have jurisdiction over the adjudication of such matters, and both the Underwriters and the Company consent to the jurisdiction of such courts and personal service with respect thereto.  The Company hereby consents to personal jurisdiction, service and venue in any court in which any claim or action arising out of or in any way relating to this Agreement is brought by any third party against the Underwriters or any indemnified party.  The Underwriters and the Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) waives all right to trial by jury in any action, proceeding or counterclaim (whether based upon contract, tort or otherwise) in any way arising out of or relating to this Agreement.

 

SECTION 17.                      Counterparts .  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.

 


 

SECTION 18.                      Effect of Headings .  The Section headings herein are for convenience only and shall not affect the construction hereof.

 

SECTION 19.                      USA Patriot Act .  In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), the Underwriters are required to obtain, verify and record information that identifies their respective clients, including the Company, which information may include the name and address of their respective clients, as well as other information that will allow the Underwriters to properly identify their respective clients.

 

SECTION 20. Recognition of the U.S. Special Resolution Regimes .

 

(a) In the event that any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

 

(b) In the event that any Underwriter that is a Covered Entity or a BHC Act Affiliate of such Underwriter becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Underwriter are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

 

“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).

 

“Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

 

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

 

“U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

 


 

If the foregoing is in accordance with your understanding of our agreement, please sign and return to the Company a counterpart hereof, whereupon this instrument, along with all counterparts, will become a binding agreement between the Underwriters, the Company, the Adviser and the Administrator in accordance with its terms.

 

 

Very truly yours,

 

 

 

COMPANY:

 

 

 

ARES CAPITAL CORPORATION

 

 

 

 

By

 

 

 

Name:

 

 

Title:

 

 

 

 

ADVISER:

 

 

 

 

ARES CAPITAL MANAGEMENT LLC

 

 

 

 

By

 

 

 

Name:

 

 

Title:

 

 

 

 

ADMINISTRATOR:

 

 

 

 

ARES OPERATIONS LLC

 

 

 

 

By

 

 

 

Name:

 

 

Title:

 

 

 

CONFIRMED AND ACCEPTED,

 

 

as of the date first above written:

 

 

 

 

 

[NAME OF REPRESENTATIVES]

 

 

 

 

 

By

 

 

 

 

Authorized Signatory

 

 

 

 

 

For themselves and as Representatives of the
other Underwriters named in Schedule A hereto.

 

 

 


 

SCHEDULE A

 

Name of Underwriter

 

Aggregate
Principal
Amount of
Senior
Securities

 

Aggregate
Principal
Amount of
Subordinated
Securities

 

Number of
Warrants

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sch A- 1


 

SCHEDULE B

 

ARES CAPITAL CORPORATION

 

$ · Aggregate Principal Amount Senior Securities
$ · Aggregate Principal Amount Subordinated Securities
and
· Warrants to Purchase Debt Securities

 

1.                                       The aggregate principal amount of the Underwritten Securities is $               .

 

2.                                       The public offering price for the Underwritten Securities shall be · % of the aggregate principal amount thereof plus accrued interest, if any, from the date of issuance.

 

3.                                       The purchase price for the Underwritten Securities to be paid by the several Underwriters shall be · % of the aggregate principal amount thereof.

 

4.                                       The interest rate is      %.

 

5.                                       The interest payment dates are         .  The record dates are       .  The first interest payment date will be         .

 

6.                                       The Securities may be redeemed in whole or in part at any time or from time to time on or after               , upon not less than 30 nor more than 60 days written notice, at a redemption price of       per security plus accrued and unpaid interest.

 

7.                                       The trade date is · .

 

8.                                       The closing date will be · .

 

Sch B- 1


 

SCHEDULE C

 

ARES CAPITAL CORPORATION
CONSOLIDATED SUBSIDIARIES

 

Sch C- 1


 

SCHEDULE D

 

MARKETING MATERIALS

 

Sch D- 1


 

SCHEDULE E

 

List of persons and entities
subject to lock-up

 

Sch E- 1




Exhibit (h)(3)

 

Ares Capital Corporation

 

Up to $ [ · ] Million

Shares of Common Stock

(par value $0.001 per share)

 

FORM OF EQUITY DISTRIBUTION AGREEMENT

 

[Month] [Day], [Year]

 

[Insert Bank & Address]

 

Ladies and Gentlemen:

 

Ares Capital Corporation, a Maryland corporation (the “ Company ”), Ares Capital Management LLC, a Delaware limited liability company (the “ Adviser ”), and Ares Operations LLC, a Delaware limited liability company (the “ Administrator ”), confirm their agreement (this “ Agreement ”) with [Bank] (the “ Manager ”), as follows:

 

SECTION 1. Description of Securities . The Company proposes to issue and sell through or to the Manager (or any Alternative Manager (as defined below)), as sales agent and/or principal, up to $ [ · ] million (the “ Maximum Amount ”) of shares of the Company’s common stock, par value $0.001 per share (the “ Common Stock ”), on the terms set forth in Section 4 of this Agreement. The shares of Common Stock to be sold through or to the Manager pursuant hereto or pursuant to a Terms Agreement (as defined below) or through or to an Alternative Manager pursuant to an Alternative Equity Distribution Agreement or Alternative Terms Agreement (each term as defined below) are referred to herein as the “ Shares .”

 

The Company has also entered into separate equity distribution agreements (each, an “ Alternative Equity Distribution Agreement ” and collectively, the “ Alternative Equity Distribution Agreements ”), dated of even date herewith, with each of the entities listed on Schedule A hereto, as sales agent and/or principal (each, an “ Alternative Manager ” and collectively, the “ Alternative Managers ”). The Company agrees that whenever it determines to sell the Shares directly to the Manager or an Alternative Manager as principal, it will enter into a separate agreement (each, a “ Terms Agreement ” or “ Alternative Terms Agreement ”, respectively) in substantially the form of Annex I hereto, relating to such sale in accordance with Section 4 of this Agreement. This Agreement and the Alternative Equity Distribution Agreements are sometimes hereinafter referred to as the “ Distribution Agreements .” The Manager and the Alternative Managers are sometimes hereinafter referred to as the “ Distribution Managers .” In addition, the Company has adopted a dividend reinvestment plan (the “ Dividend Reinvestment Plan ”) pursuant to which holders of Common Stock of the Company have their dividends automatically reinvested in additional shares of Common Stock of the Company unless they elect to receive such dividends in cash.

 

The aggregate number of Shares that may be sold pursuant to this Agreement, the Alternative Equity Distribution Agreements, any Terms Agreement and any Alternative Terms Agreement shall not exceed the Maximum Amount.

 

As used herein, “ Registration Statement ” shall mean the registration statement referred to in Section 2(a) below, including exhibits and financial statements and any prospectus supplement relating to the Shares that is filed with the Securities and Exchange Commission (the “ Commission ”) pursuant to Rule 497 under the Securities Act of 1933, as amended (collectively with the rules and regulations of the Commission thereunder, the “ 1933 Act ”), and deemed part of such registration statement pursuant to Rule 430C, as amended on each Effective Date (as defined below) and, in the event any post-effective amendment thereto becomes effective, shall also mean such registration statement as so amended, and shall also mean any new registration statement or post-effective amendment as may have been filed pursuant to Section 5(e) of this Agreement. “ Effective Date ” shall mean each date and time that the Registration Statement, any post-effective amendment or amendments thereto became or become effective. “ Basic Prospectus ” shall mean the prospectus referred to in Section 2(a) below contained in the Registration Statement at the Effective Date. “ Prospectus ” shall mean the most recent Prospectus Supplement filed with the Commission pursuant to Rule 497 under the 1933 Act, together with the Basic Prospectus.

 

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The Company has entered into an Amended and Restated Investment Advisory and Management Agreement, dated as of June 6, 2011 (the “ Investment Advisory Agreement ”) with the Adviser, which is registered as an investment adviser  under the Investment Advisers Act of 1940, as amended, and the rules and regulations thereunder (collectively, the “ Advisers Act ”).  The Company has entered into an Amended and Restated Administration Agreement, dated as of June 1, 2007 (the “ Administration Agreement ”), with the Administrator. Collectively, the Investment Advisory Agreement and the Administration Agreement are herein referred to as the “ Company Agreements .”

 

A Form N-54A — Notification of Election to be Subject to Sections 55 through 65 of the Investment Company Act of 1940 Filed Pursuant to Section 54(a) of the 1933 Act (File No. 814-00663) (the “ Notification of Election ”) was filed by the Company with the Commission on April 21, 2004 under the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder (collectively called the “ 1940 Act ”).

 

SECTION 2. Representations and Warranties of the Company . The Company represents and warrants to and agrees with the Manager that:

 

(a)  Compliance with Registration Requirements . The Company has prepared and filed with the Commission a registration statement (File No. 333- [•]) on Form N-2, including a related basic prospectus, for registration under the 1933 Act of the offering and sale of the Shares. Such Registration Statement, including any post-effective amendments thereto filed prior to the date and time that this Agreement is executed and delivered by the parties hereto (the “ Execution Time ”), has become effective. The Company may have filed, as part of an amendment to the Registration Statement or pursuant to Rule 497 under the 1933 Act, one or more amendments thereto, each of which has previously been furnished to you. The Company will file with the Commission one or more prospectus supplements (collectively, the “ Prospectus Supplement ”) related to the Shares in accordance with Rule 497 under the 1933 Act. As filed, such Prospectus Supplement, together with the Basic Prospectus, shall contain all information required by the 1933 Act and the 1940 Act and, except to the extent the Manager shall agree in writing to a modification, shall be in all substantive respects in the form furnished to you prior to the Execution Time or prior to any such time this representation is repeated or deemed to be made. The Registration Statement, at the Execution Time, as of the time of each sale of Shares pursuant to this Agreement (each, a “ Time of Sale ”), at each Settlement Date (as defined in Section 4(a)(vi) hereof), and at all times during which a prospectus is required by the 1933 Act to be delivered in connection with any sale of Shares, meets or will meet the requirements set forth in Rule 415(a)(1)(x) under the 1933 Act.

 

On the Effective Date, the Registration Statement did, and when the Prospectus is first filed in accordance with
Rule 497 under the 1933 Act, as of the date that it is filed with the Commission, the date of the Prospectus Supplement, as of each Time of Sale, at each Settlement Date, and at all times during which a prospectus is required by the 1933 Act to be delivered in connection with any sale of Shares, the Prospectus (and any supplements thereto) will, comply in all material respects with the applicable requirements of the 1933 Act and the 1940 Act; on the Effective Date, at the Execution Time and, as amended or supplemented, as of each Time of Sale, at each Settlement Date and at all times during which a prospectus is required by the 1933 Act to be delivered in connection with any sale of Shares, the Registration Statement did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not misleading; and at no time during the period that begins on the date of the Prospectus Supplement and ends at the later of each Settlement Date and the end of the period during which a prospectus is required by the 1933 Act to be delivered in connection with any sale of Shares did or will the Prospectus, as then amended or supplemented, include any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided , however , that the Company makes no representations or warranties as to the information contained in or omitted from the Registration Statement, or the Prospectus (or any supplement thereto), in reliance upon and in conformity with information furnished in writing to the Company by or on behalf of the Manager specifically for inclusion in the Registration Statement or the Prospectus (or any supplement thereto), it being understood and agreed that the only such information furnished by the Manager consists of [
· ]. The Commission has not issued any order preventing or suspending the use of the Prospectus.

 

(b)  Independent Accountants .  The accountants who certified the Company’s financial statements included in the Registration Statement and the Prospectus are independent public accountants as required by the 1933 Act and the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder (collectively called the “ Exchange Act ”).

 

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(c)  Financial Statements .  The financial statements included in the Registration Statement and the Prospectus, together with the related schedules and notes, present fairly in all material respects the financial position of the Company and its Subsidiaries (as defined below) at the dates indicated and the consolidated statement of operations, consolidated statement of stockholders’ equity and consolidated statement of cash flows of the Company and its Subsidiaries for the periods specified; there are no financial statements that are required to be included in the Registration Statement or the Prospectus that are not included as required; said financial statements have been prepared in conformity with generally accepted accounting principles in the United States (“ GAAP ”) applied on a consistent basis throughout the periods involved.  The “Selected Condensed Consolidated Financial Data of Ares Capital” included in the Registration Statement and the Prospectus present fairly, in all material respects, the information shown therein as of the date presented and have been compiled on a basis consistent with that of the audited financial statements included in the Registration Statement and the Prospectus.  The financial data set forth in the Prospectus under the caption “Capitalization” fairly presents the information set forth therein on a basis consistent with that of the audited financial statements and related notes thereto contained in the Registration Statement.  There is no pro forma financial information that is required to be included in the Registration Statement, the General Disclosure Package and the Prospectus that is not included as required.

 

(d)  No Material Adverse Change in Business .  Since the respective dates as of which information is given in the Registration Statement and the Prospectus, except as otherwise stated therein, (A) there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its Subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a “ Material Adverse Effect ”), (B) there have been no transactions entered into by the Company or its Subsidiaries, other than those in the ordinary course of business, which are material with respect to the Company and its Subsidiaries considered as one enterprise, and (C)  there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock.

 

(e)  Good Standing of the Company .  The Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Maryland and has the corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Prospectus and to enter into and perform its obligations under the Distribution Agreements, any Terms Agreement or Alternative Terms Agreement, the Investment Advisory Agreement and the Administration Agreement; and the Company is duly qualified as a foreign corporation to transact business and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure so to qualify or to be in good standing would not reasonably be expected to result in a Material Adverse Effect.

 

(f)  Subsidiaries .  The Company’s only subsidiaries that are consolidated with the Company for financial reporting purposes under GAAP are those listed on Schedule B hereto (each, a “ Subsidiary ” and collectively, the “ Subsidiaries ”).  Each of the Subsidiaries has been duly organized and is validly existing as a corporation, limited liability company or limited partnership in good standing under the laws of the jurisdiction of its organization, has power and authority to own, lease and operate its properties and to conduct its business as described in the Prospectus and is duly qualified as a foreign corporation, limited liability company or limited partnership to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except where the failure to be so qualified or to be in good standing would not reasonably be expected to result in a Material Adverse Effect; except as otherwise disclosed in the Registration Statement, all of the issued and outstanding capital stock of each such Subsidiary has been duly authorized and validly issued and is fully paid and non-assessable; none of the outstanding shares of capital stock of any of the Subsidiaries was issued in violation of the preemptive or other similar rights of any securityholder of such Subsidiary. Except (A) as set forth in the Registration Statement and the Prospectus and (B) portfolio investments made after [ · ], the Company does not own, directly or indirectly, any shares of stock or any other equity or debt securities of any corporation or have any equity or debt interest in any firm, partnership, joint venture, association or other entity that is not a Subsidiary.

 

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(g)  Capitalization .  The authorized, issued and outstanding capital stock of the Company is as set forth in the Prospectus under the caption “Capitalization” (except for subsequent issuances, if any, pursuant to this Agreement, pursuant to the Company’s Dividend Reinvestment Plan or pursuant to reservations or agreements or employee benefit plans, if any, referred to in the Prospectus or pursuant to the exercise of convertible securities or options, if any, referred to in the Prospectus).  The shares of issued and outstanding capital stock of the Company have been duly authorized and validly issued and are fully paid and non-assessable; none of the outstanding shares of capital stock of the Company was issued in violation of preemptive or other similar rights of any securityholder of the Company.

 

(h)  Authorization of Agreements .  The execution and delivery of and the performance by the Company of its obligations under this Agreement, the Alternative Equity Distribution Agreements and the Company Agreements have been, and the execution and delivery and performance by the Company of its obligations under any Terms Agreement and any Alternative Terms Agreement will have been at the time of execution thereof, duly and validly authorized by the Company and this Agreement, the Alternative Equity Distribution Agreements and the Company Agreements have been, and any Terms Agreement and any Alternative Terms Agreement will have been at the time of the execution thereof, duly executed and delivered by the Company and constitute the valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as rights to indemnity and contribution hereunder may be limited by federal or state securities laws or principles of public policy and subject to the qualifications that the enforceability of the Company’s obligations hereunder and thereunder may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and by general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(i)  Authorization and Description of Securities .  The Shares have been duly authorized for issuance and sale through or to the Distribution Managers pursuant to the Distribution Agreements or any Terms Agreement or Alternative Terms Agreement and, when issued and delivered by the Company pursuant to the provisions of the Distribution Agreements, any Terms Agreement or Alternative Terms Agreement against payment of the consideration set forth in the Distribution Agreements, will be validly issued and fully paid and non-assessable; the Common Stock conforms in all material respects to the statements relating thereto contained in the Prospectus; and the issuance of the Shares is not subject to preemptive or other similar rights of any securityholder of the Company.

 

(j)  Absence of Defaults and Conflicts .  Neither the Company nor any of the Subsidiaries is in violation of its charter, by-laws or other organizational documents.  Further, neither the Company nor any of the Subsidiaries is in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Company or any of the Subsidiaries is a party or by which any of them may be bound, or to which any of the property or assets of the Company or any of the Subsidiaries is subject (collectively, “ Agreements and Instruments ”) except for such defaults that would not result in a Material Adverse Effect; neither the execution, delivery or performance of this Agreement, the Alternative Equity Distribution Agreements, any Terms Agreement, any Alternative Terms Agreement or any of the Company Agreements, nor the consummation of the transactions herein or therein contemplated, nor the fulfillment of the terms hereof or thereof conflict with or constitute a breach of, or default or Repayment Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company or any of the Subsidiaries pursuant to, the Agreements and Instruments, except for such conflicts, breaches, defaults or Repayment Events that would not result in a Material Adverse Effect, nor will such action result in any violation of the provisions of the charter, by-laws or other organizational documents of the Company or any of the Subsidiaries or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Company or any of the Subsidiaries or any of their assets, properties or operations.  As used herein, a “ Repayment Event ” means any event or condition which gives the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by the Company or any of the Subsidiaries.

 

(k)  Absence of Proceedings .  Other than as disclosed in the Registration Statement and the Prospectus, there is no action, suit or proceeding or, to the knowledge of the Company, inquiry or investigation, before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Company, threatened, against or affecting the Company or any of the Subsidiaries, which is required to be disclosed in the

 

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Registration Statement or Prospectus, or which would result in a Material Adverse Effect, or which would materially and adversely affect the properties or assets thereof or the consummation of the transactions contemplated in this Agreement, the Alternative Equity Distribution Agreements, any Terms Agreement, any Alternative Terms Agreement or any of the Company Agreements or the performance by the Company of its obligations hereunder or thereunder; the aggregate of all pending legal or governmental proceedings to which the Company or any of the Subsidiaries is a party or of which any of their respective property or assets is the subject which are not described in the Registration Statement and the Prospectus, including ordinary routine litigation incidental to the business, would not result in a Material Adverse Effect.

 

(l)  Accuracy of Exhibits .  There are no contracts or documents which are required to be described in the Registration Statement or the Prospectus or to be filed as exhibits thereto which have not been so described and filed as required.

 

(m)  Possession of Intellectual Property .  The Company and the Subsidiaries own or possess, or can acquire on reasonable terms, adequate patents, patent rights, licenses, inventions, copyrights, know-how (including trade secrets and other unpatented and/or unpatentable proprietary or confidential information, systems or procedures), trademarks, service marks, trade names or other intellectual property (collectively, “ Intellectual Property ”) necessary to carry on the business now operated by them or currently proposed to be operated by them, except where the failure to own or possess or otherwise be able to acquire such rights in a timely manner would not otherwise reasonably be expected to result in a Material Adverse Effect, and neither the Company nor any of the Subsidiaries has received any notice of or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances which would render any Intellectual Property invalid or inadequate to protect the interest of the Company or any of the Subsidiaries therein, and which infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, singly or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.

 

(n)  Absence of Further Requirements .  No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Company of its obligations hereunder, in connection with the offering, issuance or sale of the Shares hereunder or the consummation of the transactions contemplated by this Agreement, the Alternative Equity Distribution Agreements, any Terms Agreement, any Alternative Terms Agreement, any of the Company Agreements, or the Prospectus (including the use of the proceeds from the sale of the Shares as described in the Prospectus under the caption “Use of Proceeds”), except (A) such as have been already obtained under the 1933 Act or the 1940 Act, (B) such as may be required under state securities laws, and (C) the filing of the Notification of Election under the 1940 Act, which has been effected.

 

(o)  Absence of Manipulation .  Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate take, directly or indirectly, any action which is designed to or which has constituted or which would be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares in violation of any law, statute, regulation or rule applicable to the Company or its affiliates.

 

(p)  Possession of Licenses and Permits .  The Company and the Subsidiaries possess such permits, licenses, approvals, consents and other authorizations (collectively, “ Governmental Licenses ”) issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them or currently proposed to be operated by them, except where the failure so to possess would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; the Company and the Subsidiaries are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; and neither the Company nor any of the Subsidiaries has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

 

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(q)  Investment Company Act .  The Company is not required, and upon the issuance and sale of the Shares as herein contemplated and the application of the net proceeds therefrom as described in the Prospectus will not be required, to register as a “registered management investment company” under the 1940 Act.

 

(r)  Registration Rights .  There are no persons with registration rights or other similar rights to have any securities registered pursuant to the Registration Statement or otherwise registered by the Company under the 1933 Act.

 

(s)  Related Party Transactions .  There are no business relationships or related party transactions involving the Company, any of the Subsidiaries or any other person required to be described in the Prospectus which have not been described as required.

 

(t)  Notification of Election .   When the Notification of Election was filed with the Commission, it (A) contained all statements required to be stated therein in accordance with, and complied in all material respects with the requirements of, the 1940 Act and (B) did not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

(u)  Investment Advisory Agreement .  (A) The terms of the Investment Advisory Agreement, including compensation terms, comply in all material respects with all applicable provisions of the 1940 Act and the Advisers Act and (B) the approvals by the board of directors and the stockholders of the Company of the Investment Advisory Agreement have been made in accordance with the requirements of Section 15 of the 1940 Act applicable to companies that have elected to be regulated as business development companies under the 1940 Act.

 

(v)  Interested Persons .  Except as disclosed in the Registration Statement and the Prospectus (A) no person is serving or acting as an officer, director or investment adviser of the Company, except in accordance with the provisions of the 1940 Act and the Advisers Act, and (B) to the knowledge of the Company, no director of the Company is an “interested person” (as defined in the 1940 Act) of the Company or an “affiliated person” (as defined in the 1940 Act) of any of the Distribution Managers.

 

(w)  Business Development Company .  (A) The Company has duly elected to be treated by the Commission under the 1940 Act as a business development company, such election is effective and all required action has been taken by the Company under the 1933 Act and the 1940 Act to make the public offering and consummate the sale of the Shares as provided in the Distribution Agreements; (B) the provisions of the corporate charter and by-laws of the Company, and the investment objectives, policies and restrictions described in the Registration Statement and the Prospectus, assuming they are implemented as described, will comply in all material respects with the requirements of the 1940 Act; and (C) the operations of the Company are in compliance in all material respects with the provisions of the 1940 Act applicable to business development companies.

 

(x)  Employees and Executives .  The Company is not aware that (A) any executive, key employee or significant group of employees of the Company, any of the Subsidiaries, the Adviser or the Administrator plans to terminate employment with the Company, any of the Subsidiaries, the Adviser or the Administrator or (B) any such executive or key employee is subject to any noncompete, nondisclosure, confidentiality, employment, consulting or similar arrangement that would be violated by the present or proposed business activities of the Company, any of the Subsidiaries, the Adviser or the Administrator except where such termination or violation would not reasonably be expected to have a Material Adverse Effect.

 

(y)  No Extension of Credit . The Company has not, directly or indirectly, including through a Subsidiary, extended credit, arranged to extend credit, or renewed any extension of credit, in the form of a personal loan, to or for any director or executive officer of the Company.

 

(z)  Accounting Controls .  The Company has established and maintains an effective system of internal accounting controls sufficient to provide reasonable assurances that (A) transactions are executed in accordance with management’s authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; and (C) access to assets is permitted only in accordance with management’s authorization.

 

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(aa) Disclosure Controls .  The Company has established and employs effective disclosure controls and procedures that are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms, and is accumulated and communicated to the Company’s management, including its principal executive officer or officers and principal financial officer or officers, as appropriate to allow timely decisions regarding disclosure.

 

(bb) Tax Returns .  The Company and the Subsidiaries have filed all federal, state, local and foreign tax returns that are required to have been filed by them pursuant to applicable foreign, federal, state, local or other law or have duly requested extensions thereof, except insofar as the failure to file such returns or request such extensions would not reasonably be expected to result in a Material Adverse Effect, and have paid all taxes shown as due pursuant to such returns or pursuant to any assessment received by the Company and the Subsidiaries, except for such taxes or assessments, if any, as are being contested in good faith and as to which adequate reserves have been provided or where the failure to pay would not reasonably be expected to result in a Material Adverse Effect.

 

(cc) No Unlawful Payments .   Neither the Company nor the Subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or other person associated with or acting on behalf of the Company or any of the Subsidiaries has (A) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity; (B) made any direct or indirect unlawful payment to any foreign or domestic government official or employee from corporate funds; (C) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as amended; or (D) made any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.

 

(dd) Compliance with Anti-Money Laundering Laws .  The operations of the Company and the Subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended (the “ CFTRA ”), the applicable money laundering statutes of all other jurisdictions having jurisdiction over the Company or any of the Subsidiaries, the applicable rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any other governmental agency having jurisdiction over the Company or any of the Subsidiaries (collectively, the “ Other Anti-Money Laundering Laws ”), and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of the Subsidiaries with respect to the CFTRA or Other Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.

 

(ee) No Conflicts with Sanctions Laws.   None of the Company, the Subsidiaries or, to the knowledge of the Company, any of their respective directors, officers, agents, employees or affiliates is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the United Nations Security Council, the European Union or Her Majesty’s Treasury (collectively, “ Sanctions ”); and the Company will not, directly or indirectly, use the proceeds of the offering of the Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity (i) to fund any activities of or business with any person that, at the time of such funding, is the subject of Sanctions, (ii) to fund any activities of or business in Cuba, Iran, North Korea, Sudan, Syria or the Crimea region of Ukraine or (iii) in any other manner that will result in a violation by any person of Sanctions.

 

(ff) Sarbanes-Oxley Act .  Except as disclosed in the Registration Statement and the Prospectus, the Company is, and to the knowledge of the Company, the Company’s directors and officers, in their capacities as such, are, in compliance in all material respects with any applicable provision of the Sarbanes-Oxley Act of 2002 and the rules and regulations promulgated in connection therewith, including Section 402 related to loans and Sections 302 and 906 related to certifications.

 

Any certificate signed by any officer of the Company and delivered to the Manager or counsel for the Manager in connection with the offering of the Shares shall be deemed a representation and warranty by the Company, as to matters covered therein, to the Manager.

 

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(gg) Cybersecurity . (A) The Company is not aware of any security breach or incident, unauthorized access or disclosure, or other compromise relating to the Adviser’s information technology and computer systems, data and databases used by the Company (collectively, “IT Systems and Data”) except in each case as would not reasonably expected to, individually or in the aggregate, have a Material Adverse Effect, and (B) to the Company’s knowledge, the Adviser has implemented appropriate controls, policies, procedures, and technological safeguards to maintain and protect the integrity, continuous operation, redundancy and security of its IT Systems and Data reasonably consistent with in all material respects with industry standards and practices, or as required by applicable regulatory standards. To the Company’s knowledge, the Adviser is presently in material compliance with all applicable laws and regulations relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use, access, misappropriation or modification.

 

SECTION 3. Representations and Warranties of the Adviser and the Administrator . The Adviser and the Administrator, jointly and severally, represent and warrant to, and agree with, the Manager as follows:

 

(a)  No Material Adverse Change in Business .  Since the respective dates as of which information is given in the Registration Statement and the Prospectus, except as otherwise stated therein, there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs, business prospects or regulatory status of the Adviser or the Administrator, whether or not arising in the ordinary course of business, that would reasonably be expected to result in a Material Adverse Effect.

 

(b)  Good Standing .  Each of the Adviser and the Administrator has been duly organized and is validly existing as a limited liability company in good standing under the laws of the State of Delaware, and has limited liability company power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Prospectus and to enter into and perform its obligations under the Distribution Agreements and any Terms Agreement or Alternative Terms Agreement; the Adviser has limited liability company power and authority to execute and deliver and perform its obligations under the Investment Advisory Agreement; the Administrator has limited liability company power and authority to enter into and perform its obligations under the Administration Agreement; and each of the Adviser and the Administrator is duly qualified to transact business as a foreign entity and is in good standing in each other jurisdiction in which such qualification is required, whether by reason of ownership or leasing of its property or the conduct of business, except where the failure to qualify or be in good standing would not otherwise reasonably be expected to result in a Material Adverse Effect.

 

(c)  Registration Under Advisers Act .  The Adviser is duly registered with the Commission as an investment adviser under the Advisers Act and is not prohibited by the Advisers Act or the 1940 Act from acting under the Investment Advisory Agreement for the Company as contemplated by the Registration Statement and the Prospectus. There does not exist any proceeding or, to the Adviser’s knowledge, any facts or circumstances the existence of which could lead to any proceeding which might adversely affect the registration of the Adviser with the Commission.

 

(d)  Absence of Proceedings .  There is no action, suit or proceeding or, to the knowledge of the Adviser or the Administrator, inquiry or investigation before or brought by any court or governmental agency or body, domestic or foreign, now pending, or, to the knowledge of the Adviser or the Administrator, threatened, against or affecting either the Adviser or the Administrator, which is required to be disclosed in the Registration Statement and Prospectus Supplement (other than as disclosed therein), or which would reasonably be expected to result in a Material Adverse Effect, or which would reasonably be expected to materially and adversely affect the consummation of the transactions contemplated in the Distribution Agreements and any Terms Agreement or Alternative Terms Agreement or the Company Agreements; the aggregate of all pending legal or governmental proceedings to which the Adviser or the Administrator is a party or of which any of their respective property or assets is the subject which are not described in the Registration Statement and the Prospectus, including ordinary routine litigation incidental to their business, would not reasonably be expected to result in a Material Adverse Effect.

 

(e)  Absence of Defaults and Conflicts .  Neither the Adviser nor the Administrator is in violation of its limited liability company operating agreement or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease or other agreement or instrument to which the Adviser or the Administrator is a party or by which it or any of them may be bound, or to which any of the property or assets of the Adviser or the Administrator is subject (collectively, the “ Adviser/Administrator Agreements and Instruments ”), or in violation of any law, statute, rule, regulation, judgment, order or decree except for such violations or defaults that would not reasonably be expected to

 

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result in a Material Adverse Effect; and the execution, delivery and performance of the Distribution Agreements, any Terms Agreement or Alternative Terms Agreement or the Company Agreements and the consummation of the transactions contemplated herein and therein and in the Registration Statement and the Prospectus  (including the issuance and sale of the Shares and the use of the proceeds from the sale of the Shares as described in the Prospectus under the caption “Use of Proceeds”) and compliance by the Adviser and the Administrator with their respective obligations hereunder and under the Investment Advisory Agreement and the Administration Agreement do not and will not, whether with or without the giving of notice or passage of time or both, conflict with or constitute a breach of, or default under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Adviser or the Administrator pursuant to, the Adviser/Administrator Agreements and Instruments except for such violations or defaults that would not reasonably be expected to result in a Material Adverse Effect, nor will such action result in any violation of the provisions of the limited liability company operating agreement of the Adviser or Administrator, respectively, or any applicable law, statute, rule, regulation, judgment, order, writ or decree of any government, government instrumentality or court, domestic or foreign, having jurisdiction over the Adviser or the Administrator or any of their assets, properties or operations.

 

(f)  Authorization of Agreements .  The execution and delivery of and the performance by the Adviser or the Administrator, as applicable, of their obligations under this Agreement, the Alternative Equity Distribution Agreements and the Company Agreements have been, and the execution and delivery and performance by the Adviser or the Administrator, as applicable, of their obligations under any Terms Agreement and any Alternative Terms Agreement will have been at the time of execution thereof, duly and validly authorized by the Adviser or the Administrator, as applicable, and this Agreement, the Alternative Equity Distribution Agreements and the Company Agreements have been, and any Terms Agreement and any Alternative Terms Agreement will have been at the time of the execution thereof, duly executed and delivered by the Adviser or the Administrator, as applicable, and constitute the valid and binding obligations of the Adviser or the Administrator, as applicable, enforceable against the Adviser or Administrator, as applicable, in accordance with their terms, except as rights to indemnity and contribution hereunder may be limited by federal or state securities laws or principles of public policy and subject to the qualifications that the enforceability of the Adviser or the Administrator’s obligations hereunder and thereunder may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws now or thereafter in effect relating to creditors’ rights generally and by general principles of equity and the discretion of the court before which any proceeding therefor may be brought.

 

(g)  Absence of Further Requirements .  No filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any court or governmental authority or agency is necessary or required for the performance by the Adviser or the Administrator of their obligations hereunder, in connection with the offering, issuance or sale of the Shares hereunder or the consummation of the transactions contemplated by this Agreement, the Alternative Equity Distribution Agreements, any Terms Agreement, any Alternative Terms Agreement any of the Company Agreements, or the Prospectus (including the use of the proceeds from the sale of the Shares as described in the Prospectus under the caption “Use of Proceeds”), except such as have been already obtained under the 1933 Act or the 1940 Act.

 

(h)  Description of Adviser and Administrator . The description of the Adviser and the Administrator contained in the Registration Statement and the Prospectus does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.

 

(i)  Possession of Licenses and Permits .  The Adviser and the Administrator possess such Governmental Licenses issued by the appropriate federal, state, local or foreign regulatory agencies or bodies necessary to conduct the business now operated by them, except where the failure so to possess would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect; the Adviser and the Administrator are in compliance with the terms and conditions of all such Governmental Licenses, except where the failure so to comply would not, singly or in the aggregate, result in a Material Adverse Effect; all of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, singly or in the aggregate, result in a Material Adverse Effect; and neither the Adviser nor the Administrator has received any notice of proceedings relating to the revocation or modification of any such Governmental Licenses which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would reasonably be expected to result in a Material Adverse Effect.

 

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(j)  Stabilization and Manipulation . Neither the Adviser, the Administrator nor any of their respective partners, officers, affiliates or controlling persons has taken, directly or indirectly, any action designed, under the Exchange Act, to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale of the Shares in violation of any law, statute, regulation or rule applicable to the Adviser, the Administrator or any of their respective partners, officers, affiliates or controlling persons.

 

(k)  Employment Status . The Adviser is not aware that (A) any executive, key employee or significant group of employees of the Company, if any, any of the Subsidiaries, the Adviser or the Administrator, as applicable, plans to terminate employment with the Company, any of the Subsidiaries, the Adviser or the Administrator or (B) any such executive or key employee is subject to any noncompete, nondisclosure, confidentiality, employment, consulting or similar agreement that would be violated by the present or proposed business activities of the Company, the Subsidiaries or the Adviser except where such termination or violation would not reasonably be expected to have a Material Adverse Effect.

 

(l)  Internal Controls .  The Adviser is using its commercially reasonable efforts to operate a system of internal controls sufficient to provide reasonable assurance that (A) transactions effectuated by it under the Investment Advisory Agreement are executed in accordance with its management’s general or specific authorization; and (B) access to the Company’s assets that are in its possession or control is permitted only in accordance with its management’s general or specific authorization.

 

(m)  Accounting Controls .  The Administrator is using its commercially reasonable efforts to operate a system of internal accounting controls sufficient to provide reasonable assurance that (A) transactions for which it has bookkeeping and record keeping responsibility for under the Administration Agreement are recorded as necessary to permit preparation of the Company’s financial statements in conformity with GAAP and to maintain financial statements in conformity with GAAP and to maintain accountability for the Company’s assets and (B) the recorded accountability for such assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

 

Any certificate signed by any officer of the Adviser or Administrator and delivered to the Manager or counsel for the Manager in connection with the offering of the Shares shall be deemed a representation and warranty by the Adviser or Administrator, as applicable, as to matters covered therein, to the Manager.

 

SECTION 4. Sale and Delivery of Shares.

 

(a) On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Company agrees to issue and sell through the Manager, as sales agent, and the Manager agrees to use its commercially reasonable efforts to sell, as sales agent for the Company, the Shares on the following terms.

 

(i) Each time that the Company wishes to issue and sell Shares on any day that is a trading day for the NASDAQ Global Select Market (the “ NASDAQ ”) (a “ Trading Day ”) (other than a Trading Day on which the NASDAQ is scheduled to close prior to its regular weekday closing time) pursuant to this Agreement (each, a “ Placemen t”), it will instruct the Manager by telephone of the parameters in accordance with which it desires Shares to be sold, which shall at a minimum include the number of Shares to be offered, the time period during which sales are requested to be made, the minimum price below which sales may not be made and any limitation on the number of Shares that may be sold in any one day (a “ Placement Notice ”). If the Manager wishes to accept such proposed terms included in the Placement Notice (which it may decline to do for any reason in its sole discretion) or, following discussion with the Company, wishes to accept amended terms, the Manager will, prior to 4:30 p.m. (New York City time) or, if later, within three hours after receipt of the Placement Notice, on the same business day (as defined below) on which such Placement Notice is delivered to the Manager, issue to the Company a notice by email addressed to all of the authorized representatives of the Company on Schedule C hereto (the “ Authorized Company Representatives ”) confirming all of the parameters of the Placement or setting forth the terms it is willing to accept. Where the terms provided in the Placement Notice are amended as provided for in the immediately preceding sentence, such terms will not be binding on the Company or the Manager until the Company delivers to the Manager an acceptance by email (or other method mutually agreed to in writing by the parties) of all of the terms of such Placement Notice, as amended (the “ Acceptance ”). The Placement Notice (as amended by the corresponding

 

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Acceptance, if applicable) shall be effective upon receipt by any of the Authorized Company Representatives of the email notice from the Manager or upon receipt by the Manager of the Company’s Acceptance, as the case may be, unless and until (i) the entire amount of the Shares covered by the Placement Notice have been sold, (ii) in accordance with Section 4(a)(ii) hereof, the Company suspends or terminates the Placement Notice, (iii) the Company issues a subsequent Placement Notice with parameters superseding those on the earlier dated Placement Notice, or (iv) this Agreement has been terminated under the provisions of Section 10. Subject to the terms and conditions hereof, the Manager shall use its commercially reasonable efforts to offer and sell all of the Shares designated in the Placement Notice;  provided however , that the Manager shall have no obligation to offer or sell any Shares, and the Company acknowledges and agrees that the Manager shall have no such obligation in the event an offer or sale of the Shares on behalf of the Company may in the judgment of the Manager constitute the sale of a “block” under Rule 10b-18(a)(5) under the Exchange Act or a “distribution” within the meaning of Rule 100 of Regulation M under the Exchange Act or the Manager reasonably believes it may be deemed an “underwriter” under the 1933 Act in a transaction that is other than (A) by means of ordinary brokers’ transactions between members of the NASDAQ that qualify for delivery of a Prospectus to the NASDAQ in accordance with Rule 153 under the 1933 Act or (B) directly on or through an electronic communication network, a “dark pool” or any similar market venue (the transactions described in (A) and (B) are hereinafter referred to as “ At the Market Offerings ”).

 

(ii) Notwithstanding the foregoing, the Company or the Manager may, upon notice to the other party by telephone (confirmed promptly by electronic mail from such party), suspend the offering of the Shares pursuant to this Agreement or suspend or terminate a previously issued Placement Notice; provided , however , that such suspension or termination shall not affect or impair the parties’ respective obligations with respect to the Shares sold hereunder prior to the giving of such notice.

 

(iii) The Manager hereby covenants and agrees not to make any sales of the Shares on behalf of the Company, pursuant to this Section 4(a), other than (A) by means of At the Market Offerings and (B) such other sales of the Shares on behalf of the Company in its capacity as agent of the Company as shall be agreed by the Company and the Manager.

 

(iv) The compensation to the Manager, as an agent of the Company, for sales of the Shares shall be up to [ · ]% of the gross sales price of the Shares sold pursuant to this Section 4(a). The foregoing rate of compensation shall not apply when the Manager acts as principal, in which case the Company may sell Shares to the Manager as principal at a price agreed upon at the relevant applicable time pursuant to a Terms Agreement. The remaining proceeds, after further deduction for any transaction fees imposed by any governmental or self-regulatory organization in connection with such sales, shall constitute the net proceeds to the Company for such Shares (the “ Net Proceeds ”).

 

(v) The Manager shall provide written confirmation to the Company as soon as practicable following the close of trading on the NASDAQ each day in which the Shares are sold under this Section 4(a) setting forth the aggregate amount of the Shares sold on such day, the aggregate Net Proceeds to the Company, and the aggregate compensation payable by the Company to the Manager with respect to such sales. For the avoidance of doubt, such written confirmation shall be provided to the Company no later than the opening of trading on the immediately following Trading Day.

 

(vi) Settlement for sales of the Shares pursuant to this Section 4(a) will occur on the second Trading Day following the date on which such sales are made (provided that, if such second Trading Day is not a business day, then settlement will occur on the next succeeding Trading Day that is also a business day), unless another date shall be agreed upon by the Company and the Manager (each such date, a “ Settlement Date ”). As used herein, the term “ business day ” means any day other than a Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law, regulation or executive order to close. On each Settlement Date, the Shares sold through the Manager for settlement on such date shall be issued and delivered by the Company to the Manager against payment of the Net Proceeds for the sale of such Shares. Settlement for all such Shares shall be effected by electronically transferring the Shares by the Company or its transfer agent to the Manager’s account, or to the account of the Manager’s designee, at The Depository Trust Company (“ DTC ”) through its Deposit and Withdrawal at Custodian System (“ DWAC ”) or by such other means of delivery as may be mutually agreed upon by the Company and the Manager, which in all cases shall be freely tradable, transferable, registered shares eligible for delivery through DTC, in return for payments in same day funds delivered to the account designated by the Company. If the Company, or its transfer agent (if applicable), shall default on its obligation to deliver the Shares on

 

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any Settlement Date, the Company shall (A) indemnify and hold the Manager harmless against any loss, claim or damage arising from or as a result of such default by the Company and (B) pay the Manager any commission to which it would otherwise be entitled absent such default. The Authorized Company Representatives, or any designees thereof as notified to the Manager in writing, shall be the contact persons for the Company for all matters related to the settlement of the transfer of the Shares through DWAC for purposes of this Section 4(a)(vi).

 

(vii) At each Time of Sale, Settlement Date and Representation Date (as defined in Section 5(s) hereof), the Company, the Adviser and the Administrator shall be deemed to have affirmed their respective representations and warranties contained in this Agreement. Any obligation of the Manager to use its commercially reasonable efforts to sell the Shares on behalf of the Company shall be subject to the continuing accuracy of the representations and warranties of the Company, the Adviser and the Administrator herein, to the performance by the Company, the Adviser and the Administrator of their obligations hereunder and to the continuing satisfaction of the additional conditions specified in Section 6 of this Agreement.

 

(b)  (i) If the Company wishes to issue and sell the Shares other than as set forth in Section 4(a) of this Agreement or as set forth in Section 4(a) of any Alternative Equity Distribution Agreement, it may elect, in its sole discretion, to notify the Manager of the proposed terms of such sale. If the Manager, acting as principal, wishes to accept such proposed terms (which it may decline to do for any reason in its sole discretion) or, following discussions with the Company, wishes to accept amended terms, the Manager, the Company and, if applicable, the Alternative Managers will enter into a Terms Agreement setting forth the terms of such Placement. In the event of a conflict between the terms of this Agreement and the terms of any Terms Agreement, the terms of such Terms Agreement will control.  For avoidance of doubt, nothing contained in this Agreement shall be construed to require the Company to engage the Manager or any Alternative Managers in connection with the offer and sale of any of the Company’s securities, including shares of its Common Stock, whether in connection with an underwritten offering or otherwise.

 

(c)  In the event the Company engages the Manager for a sale of Shares that would constitute the sale of a “block” under Rule 10b-18(a)(5) under the Exchange Act or a “distribution,” within the meaning of Rule 100 of Regulation M under the Exchange Act, the Company and the Manager will agree to compensation that is customary for the Manager with respect to such transactions.

 

(d) (i) Under no circumstances shall the Company cause or request the offer or sale of any Shares if, after giving effect to the sale of such Shares, the aggregate gross sales proceeds or the aggregate number of the Shares sold pursuant to this Agreement and any Alternative Equity Distribution Agreement would exceed the lesser of (A) the Maximum Amount, (B) the amount available for offer and sale under the currently effective Registration Statement and (C) the amount authorized from time to time to be issued and sold under this Agreement and any Alternative Equity Distribution Agreement by the Company’s board of directors, or a duly authorized committee thereof, and notified to the Manager in writing. Under no circumstances shall the Company cause or request the offer or sale of any Shares (i) at a price lower than the minimum price authorized from time to time by the Company’s board of directors or a duly authorized committee thereof, and notified to the Manager in writing and (ii) at a price (net of the Manager’s commission, discount or other compensation for such sales payable by the Company pursuant to this Section 4) lower than the Company’s then current net asset value per share (as calculated pursuant to the 1940 Act), unless the Company has received the requisite approval from the Company’s board of directors or a duly authorized committee thereof, and notifies the Manager in writing.

 

(ii) If any party has reason to believe that the exemptive provisions set forth in Rule 101(c)(1) of Regulation M under the Exchange Act are not satisfied with respect to the Shares, it shall promptly notify the other parties and sales of the Shares under this Agreement and any Alternative Equity Distribution Agreement shall be suspended until that or other exemptive provisions have been satisfied in the judgment of each party. Upon the reasonable request of the Company in writing to the Manager (which such request may be by electronic mail), the Manager shall promptly calculate and provide in writing to the Company a report setting forth, for the prior week, the average daily trading volume (as defined in Rule 100 of Regulation M under the Exchange Act) of the Common Stock.

 

(e) Each sale of the Shares to or through the Manager or any Alternative Manager, as applicable, shall be made in accordance with the terms of this Agreement or, if applicable, a Terms Agreement, or the respective Alternative Equity Distribution Agreement or, if applicable, an Alternative Terms Agreement, as applicable. The commitment of the Manager to purchase the Shares pursuant to any Terms Agreement shall be deemed to have been made on the

 

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basis of the representations and warranties of the Company, the Adviser and the Administrator herein contained and shall be subject to the terms and conditions herein set forth. Each Terms Agreement shall specify the number of the Shares to be purchased by the Manager pursuant thereto, the price to be paid to the Company for such Shares, any provisions relating to rights of, and default by, underwriters acting together with the Manager in the reoffering of the Shares, any provisions relating to the granting of an option to purchase additional Shares for the purpose of covering over-allotments, and the time and date (each such time and date being referred to herein as a “ Time of Delivery ”) and place of delivery of and payment for such Shares. Such Terms Agreement shall also specify any requirements for opinions of counsel, accountants’ letters and officers’ certificates pursuant to Section 6 hereof and any other information or documents required by the Manager.

 

(f) Subject to such further limitations on offers and sales of Shares or delivery of instructions to offer and sell Shares as are set forth herein, or in any Alternative Equity Distribution Agreement, and as may be mutually agreed upon by the Company and the Manager or any Alternative Manager, as applicable, offers and sales of Shares pursuant to this Agreement or any Alternative Equity Distribution Agreement, as applicable, shall not be requested by the Company and need not be made by the Manager or any Alternative Manager, as applicable, at any time when or during any period in which (i) the Company is or could be deemed to be in possession of material non-public information, or (ii) without the prior written consent of the Manager or any Alternative Manager, as applicable, with respect to the Company’s quarterly filings on Form 10-Q and annual report filings on Form 10-K, commencing upon the 5th business day prior to the Company’s filing of its quarterly report on Form 10-Q or annual report on Form 10-K, as applicable, and ending on the date on which the Company files with the Commission a Prospectus Supplement under Rule 497 relating to the Shares that includes (x) updated unaudited financial information as of the end of the Company’s most recent quarterly period (the “ 10-Q Filing ”) or (y) updated audited financial information as of the end of the Company’s most recent fiscal year (the “ 10-K Filing ”), as applicable (each of such 10-Q Filing and/or a 10-K Filing shall also be referred to herein as a “ Quarterly 497 Filing ”). To the extent the Company releases its earnings for its most recent quarterly period or fiscal year, as applicable (an “ Earnings Release ”), before it files with the Commission its quarterly report on Form 10-Q for such quarterly period or annual report on Form 10-K for such fiscal year, as applicable, then the Manager and the Company agree that no sales of Shares shall take place for the period beginning on the date of the Earnings Release and ending on the date of the applicable Quarterly 497 Filing without the prior written consent of the Manager.

 

(g) The Company acknowledges and agrees that (A) there can be no assurance that the Manager or any Alternative Manager will be successful in selling the Shares, (B) neither the Manager nor any Alternative Manager will incur liability or obligation to the Company or any other person or entity if such Manager does not sell Shares for any reason other than a failure by the Manager or any Alternative Manager to use its commercially reasonable efforts consistent with its normal trading and sales practices and applicable law and regulations to sell such Shares in accordance with the terms of this Agreement or any Alternative Equity Distribution Agreement, as applicable, and (C) neither the Manager nor any Alternative Manager shall be under any obligation to purchase Shares on a principal basis pursuant to this Agreement or any Alternative Equity Distribution Agreement, as applicable, except as otherwise specifically agreed in writing by the Manager and the Company or any Alternative Manager and the Company, as applicable.  For purposes of clarification, the Manager shall only be deemed to be acting as a sales agent under this Agreement during the period beginning with the delivery of a Placement Notice from the Company to the Manager and ending upon the suspension or termination of such Placement Notice or the completion of the sale of Shares in accordance with such Placement Notice.

 

(h) The Company agrees that, during the term of this Agreement, any offer to sell, any solicitation of an offer to buy, or any sales of Shares or sales of Common Stock pursuant to any At the Market Offering (as defined herein and within the meaning of Rule 415(a)(4) under the 1933 Act) shall only be effected by or through the Manager or an Alternative Manager, but in no event may more than one Distribution Manager be selling Shares under the Distribution Agreements on any single given day, and the Company shall in no event request that more than one Distribution Manager sell Shares on the same day.  Notwithstanding the foregoing or anything else herein to the contrary, nothing contained in this Agreement shall be construed to limit the Company’s ability to engage additional Distribution Managers subsequent to the date hereof.  The Company will notify the Manager and the Alternative Managers in the event that it engages one or more additional Distribution Managers subsequent to the date hereof and Schedule A hereto shall be deemed to incorporate by reference the names of each of the Distribution Managers (other than the Manager) listed on Schedule A of the Distribution Agreements subsequently entered into by the Company and such additional Distribution Managers.

 

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SECTION 5. Covenants of the Company . The Company agrees with the Manager:

 

(a) During any period that a prospectus relating to the Shares is required to be delivered under the 1933 Act, the Company, subject to Sect ion 5(b) , will comply with the requirements of Rule 415, Rule 430C and Rule 497 under the 1933 Act and will notify the Manager immediately, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective, or any supplement to the Prospectus or any amended Prospectus shall have been filed, (ii) of the receipt of any comments from the Commission relating to the Registration Statement, (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information, and (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or of any order preventing or suspending the use of any prospectus, or of the suspension of the qualification of the Shares for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes.  The Company will promptly effect the filings necessary pursuant to Rule 497 and will take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 497 was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus.  During any period that a prospectus relating to the Shares is required to be delivered under the 1933 Act, the Company will use its reasonable efforts to prevent the issuance of any stop order and, if any stop order is issued, to obtain the lifting thereof at the earliest possible moment.

 

(b) The Company shall notify the Manager promptly of the time on or after the date of this Agreement when any amendment to the Registration Statement has been filed or becomes effective or when the Basic Prospectus or the Prospectus or any supplement to any of the foregoing has been filed; and the Company shall cause the Basic Prospectus, the Prospectus Supplement and the Prospectus and each amendment or supplement to the Basic Prospectus, the Prospectus Supplement or the Prospectus to be filed with the Commission as required pursuant to Rule 497 under the 1933 Act within the time period prescribed.

 

(c) Upon the Manager’s written request, the Company will deliver to the Manager, without charge, conformed copies of the Registration Statement as originally filed, and of each amendment thereto (including exhibits filed therewith or incorporated by reference therein) and conformed copies of all consents and certificates of experts, and, upon the Manager’s request, will also deliver to the Manager, without charge, a conformed copy of the Registration Statement as originally filed and of each amendment thereto (without exhibits).  The copies of the Registration Statement and each amendment thereto furnished to the Manager will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T, or as filed with the Commission in paper form as permitted by Regulation S-T.

 

(d) The Company shall make available to the Manager, as soon as practicable after this Agreement becomes effective, and thereafter from time to time shall furnish to the Manager, as many copies of the Prospectus (or of the Prospectus as amended or supplemented if the Company shall have made any amendments or supplements thereto after the effective date of the Registration Statement) as the Manager may reasonably request for the purposes contemplated by the 1933 Act; in case the Manager is required to deliver (whether physically, deemed to be delivered pursuant to Rule 153 or any similar rule), in connection with the sale of the Shares, a prospectus after the nine-month period referred to in Section 10(a)(3) of the 1933 Act, or after the time a post-effective amendment to the Registration Statement is required pursuant to Item 512(a) of Regulation S-K under the 1933 Act, the Company will prepare, at its expense, such amendment or amendments to the Registration Statement and the Prospectus as may be necessary to permit compliance with the requirements of Section 10(a)(3) of the 1933 Act or Item 512(a) of Regulation S-K under the 1933 Act, as the case may be.

 

(e) The Company will use its commercially reasonable efforts to comply with the 1933 Act so as to permit the completion of the distribution of the Shares as contemplated in this Agreement and in the Prospectus.  If at any time when a prospectus is required by the 1933 Act to be delivered in connection with sales of the Shares, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Manager or for the Company, to amend the Registration Statement or amend or supplement the Prospectus in order that the Prospectus will not include any untrue statements of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser, or if it shall be necessary, in the opinion of such counsel, at any such time to amend the Registration Statement or amend or supplement the Prospectus in order to comply with the requirements of the 1933 Act, the

 

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Company will promptly prepare and file with the Commission, subject to Section 5(b), such amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement or the Prospectus comply with such requirements, and the Company will furnish to the Manager such number of copies of such amendment or supplement as the Manager may reasonably request.

 

(f) The Company will use its commercially reasonable efforts, in cooperation with the Manager, to qualify the Shares for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Manager may designate and to maintain such qualifications in effect for as long as the Manager reasonably requests; provided, however, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

 

(g) The Company will timely file such reports pursuant to the Exchange Act as are necessary in order to make generally available to its securityholders as soon as reasonably practicable an earnings statement for the purposes of, and to provide the benefits contemplated by, the last paragraph of Section 11(a) of the 1933 Act.

 

(h) The Company will use the Net Proceeds received by it from the sale of the Shares in the manner specified in the Prospectus under “Use of Proceeds”.

 

(i) The Company will use its commercially reasonable efforts to effect and maintain the listing of the Common Stock on the NASDAQ.

 

(j) At any time during the pendency of a Placement Notice, the Company shall not sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to sell or otherwise dispose of or agree to dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exchangeable or exercisable for Common Stock (including without limitation, any options, warrants or other rights to purchase Common Stock), in each case without giving the Manager at least [ · ] Trading Days’ prior written notice specifying the nature of the proposed sale and the date of such proposed sale. The foregoing sentence shall not apply to (i) the Shares to be offered and sold to the Manager or any Alternative Manager pursuant to this Agreement or any Terms Agreement, Alternative Equity Distribution Agreement or Alternative Terms Agreement, as applicable, (ii) the issuance of any shares of Common Stock issued by the Company upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof and referred to in the Prospectus, (iii) any shares of Common Stock issued or options to purchase shares of Common Stock granted pursuant to existing dividend reinvestment plans or employee benefit plans of the Company referred to in the Prospectus, and any registration related thereto, (iv) any shares of Common Stock issued pursuant to any non-employee director stock plan or dividend reinvestment plan, and any registration related thereto, (v) any shares of Common Stock issued to directors in lieu of directors’ fees, and any registration related thereto or (vi) the issuance by the Company of any shares of Common Stock as consideration for any strategic acquisitions. In the event that notice of a proposed sale is provided by the Company pursuant to this subsection (j), the Manager will suspend activity under this Agreement for such period of time as requested by the Company or as may be deemed appropriate by the Manager.

 

(k) The Company, during the term of this Agreement, will use its commercially reasonable efforts to maintain its status as a business development company; provided , however , the Company may cease to be, or withdraw its election as, a business development company, with the approval of the board of directors and a vote of stockholders as required by Section 58 of the 1940 Act or any successor provision.

 

(l) During the term of this Agreement, the Company will use its commercially reasonable efforts to qualify and elect to be treated as a regulated investment company under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”), and to maintain such qualification and election in effect for each full fiscal year during which it is a business development company under the 1940 Act.

 

(m) The Company will use its commercially reasonable efforts to maintain a system of internal accounting controls sufficient to provide reasonable assurances that (A) material information relating to the Company and the assets managed by the Adviser is promptly made known to the officers responsible for establishing and maintaining the

 

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system of internal accounting controls; and (B) any significant deficiencies or weaknesses in the design or operation of internal accounting controls which could adversely affect the Company’s ability to record, process, summarize and report financial data, and any fraud whether or not material that involves management or other employees who have a significant role in internal controls, are adequately and promptly disclosed to the Company’s independent auditors and the audit committee of the Company’s board of directors.

 

(n) Reserved.

 

(o) The Company shall pay all expenses incident to the performance of its obligations under this Agreement, whether or not the transactions contemplated hereby are consummated or this Agreement is terminated, including (i) the preparation and filing of the Registration Statement, the Basic Prospectus, the Prospectus Supplement, the Prospectus and any amendments or supplements thereto, and the printing and furnishing of copies of each thereof to the Manager (including costs of mailing and shipment), (ii)  the printing and delivery to the Manager of this Agreement and such other documents as may be required in connection with the offering, purchase, sale, issuance or delivery of the Shares, (iii) the issuance and delivery of the Shares through or to the Manager, including any stock or other transfer taxes and any stamp or other duties payable upon the sale, issuance or delivery of the Shares through or to the Manager, (iv) the fees and disbursements of the Company’s, the Adviser’s and the Administrator’s counsel, accountants and other advisors, (v) the qualification of the Shares under securities laws in accordance with the provisions of Section 5(f) hereof, including filing fees and the reasonable fees and disbursements of counsel for the Manager in connection therewith and in connection with the preparation of Blue Sky Surveys and any supplement thereto, (vi) the printing and delivery to the Manager of copies of the Prospectus and any amendments or supplements thereto, (vii) the preparation, printing and delivery to the Manager of copies of the Blue Sky Survey and any supplement thereto, (viii) the fees and expenses of any transfer agent or registrar for the Shares, (ix) the filing fees incident to, and the reasonable fees and disbursements of counsel to the Manager in connection with, the review by the Financial Industry Regulatory Authority (“ FINRA ”) of the terms of the sale of the Shares, and (x) the fees and expenses incurred in connection with the inclusion of the Shares in the NASDAQ. Except as set forth herein, the Manager will pay all of its other out-of-pocket costs and expenses incurred in connection with entering into this Agreement and the transactions contemplated by this Agreement, including, without limitation, travel and similar expenses, whether or not the transactions contemplated hereby are consummated or this Agreement is terminated.

 

(p) The Company shall not, at any time at or after the execution of this Agreement, offer or sell any Shares by means of any “prospectus” (within the meaning of the 1933 Act), or use any “prospectus” (within the meaning of the 1933 Act) in connection with the offer or sale of the Shares, in each case other than the Prospectus.

 

(q) Neither the Company nor any affiliate of the Company will take, directly or indirectly, any action designed, or which will constitute, or has constituted, or might reasonably be expected to cause or result in (i) the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares or (ii) a violation of Regulation M. The Company shall notify the Manager of any violation of Regulation M by the Company, any of its affiliates or any of their respective officers or directors promptly after the Company has received notice or obtained knowledge of any such violation.

 

(r) The Company shall advise the Manager promptly after it shall have received notice or obtained knowledge thereof, of any information or fact that would materially alter or affect any opinion, certificate, letter and other document provided to the Manager pursuant to Section 6 herein.

 

(s) Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the offering of the Shares under this Agreement following the termination of a Suspension Period (as defined below)), and each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented by the Quarterly 497 Filing or otherwise (other than amendments or supplements that are filed solely to report sales of the Shares pursuant to this Agreement), (ii) the Shares are delivered to the Manager pursuant to a Terms Agreement, or (iii) the Manager may reasonably request (the date of commencement of the offering of the Shares under this Agreement, the date of commencement of the offering of the Shares under this Agreement following the termination of a Suspension Period and each date referred to in subclauses (i), (ii) and (iii) above, each a “ Representation Date ”), the Company shall furnish or cause to be furnished to the Manager forthwith certificates signed by the chief executive officer or president (or with respect to the Adviser or Administrator, an authorized officer) and of the chief

 

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financial or chief accounting officer of each of the Company, the Adviser and the Administrator of the Company, as the case may be, dated and delivered the Representation Date, in form satisfactory to the Manager to the effect that the statements contained in the certificate referred to in Section 6(c) of this Agreement which was last furnished to the Manager are true and correct as of such Representation Date as though made at and as of such date (except that such certificates shall state that such statements shall be deemed to relate to the Registration Statement and the Prospectus, in each case as amended and supplemented to such date) or, in lieu of such certificates, certificates of the same tenor as the certificates referred to in said Section 6(c), modified as necessary to relate to the Registration Statement and the Prospectus, in each case as amended and supplemented to the time of delivery of such certificate; provided that the obligations under this subsection (s) shall be deferred when no Placement Notice is pending or for any period that the Company has suspended the offering of Shares pursuant to Section 4(a)(ii) hereof (each, a “ Suspension Period ”) and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to deliver the required deliverable to the Manager at such time if it was not delivered at the last Representation Date).

 

(t) At each Representation Date, the Company shall furnish or cause to be furnished forthwith to the Manager written opinions of Kirkland & Ellis LLP, counsel to the Company (“ Company Counsel ”), and Eversheds Sutherland (US) LLP, special regulatory counsel for the Company (“ Regulatory Counsel ”), dated and delivered as of such Representation Date, in form and substance reasonably satisfactory to the Manager, of the same tenor as the opinions referred to in Section 6(d) of this Agreement, but modified as necessary to relate to the Registration Statement and the Prospectus, in each case as amended and supplemented to the time of delivery of such opinions; provided that the obligation of the Company under this subsection (t) shall be deferred when no Placement Notice is pending or for any Suspension Period and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to deliver the required deliverable to the Manager at such time if it was not delivered at the last Representation Date).

 

(u) At each Representation Date, the Company shall furnish or cause to be furnished forthwith to the Manager a written opinion of Venable LLP, Maryland counsel to the Company (“ Maryland Counsel ”), dated and delivered as of such Representation Date, in form and substance reasonably satisfactory to the Manager, of the same tenor as the opinion referred to in Section 6(e) of this Agreement, but modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented to the time of delivery of such opinion; provided that the obligation of the Company under this subsection (u) shall be deferred when no Placement Notice is pending or for any Suspension Period and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to deliver the required deliverable to the Manager at such time if it was not delivered at the last Representation Date).

 

(v) At each Representation Date, the Company shall furnish or cause to be furnished to the Manager forthwith certificates of the Secretary or Assistant Secretary of the Company, the Adviser and the Administrator, dated and delivered as of such Representation Date, in form and substance reasonably satisfactory to the Manager, of the same tenor as the certificate referred to in Section 6(e) of this Agreement but modified to relate to the Registration Statement and the Prospectus, in each case as amended and supplemented to the date of such certificates; provided that the obligations under this subsection (v) shall be deferred when no Placement Notice is pending or for any Suspension Period and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to deliver the required deliverable to the Manager at such time if it was not delivered at the last Representation Date).

 

(w) At each Representation Date, [               ], counsel to the Manager, shall deliver a written opinion, dated and delivered as of such Representation Date, in form and substance reasonably satisfactory to the Manager; provided that the obligation under this subsection (w) shall be deferred when no Placement Notice is pending or for any Suspension Period and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to deliver the required deliverable to the Manager at such time if it was not delivered at the last Representation Date).

 

(x) Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the offering of the Shares under this Agreement following the termination of a Suspension Period), and each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented to include updated annual audited financial statements of the Company, (ii) the Company shall file a Quarterly 497 Filing, (iii) the Shares are delivered

 

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to the Manager pursuant to a Terms Agreement, or (iv) the Manager may reasonably request, the Company shall cause the independent registered public accountants of the Company, or other independent accountants satisfactory to the Manager, forthwith to furnish the Manager a letter, dated the date of the commencement or recommencement of the offering, the date of effectiveness of such amendment, the date of filing of such supplement or other document with the Commission, or the date of such request, as the case may be, in form and substance reasonably satisfactory to the Manager, of the same tenor as the letter referred to in Section 6(h) of this Agreement but modified to relate to the Registration Statement and the Prospectus as amended and supplemented to the date of such letter; provided that the obligation of the Company under this subsection (x) shall be deferred when no Placement Notice is pending or for any Suspension Period and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to deliver the required deliverable to the Manager at such time if it was not delivered at the last Representation Date).

 

(y) Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the offering of the Shares under this Agreement following the termination of a Suspension Period), and each time that (i) the Registration Statement or the Prospectus shall be amended or supplemented to include updated annual financial statements of the Company, (ii) the Company shall file a Quarterly 497 Filing, (iii) the Shares are delivered to the Manager pursuant to a Terms Agreement, or (iv) the Manager may reasonably request, the Company shall furnish to the Manager forthwith a certificate of the chief financial officer of the Company, dated the date of the commencement or recommencement of the offering, the date of effectiveness of such amendment, the date of filing of such supplement or other document with the Commission, or the date of such request, as the case may be, in form and substance reasonably satisfactory to the Manager, of the same tenor as the certificate referred to in Section 6(i) of this Agreement but modified to relate to the Registration Statement and the Prospectus as amended and supplemented to the date of such certificate; provided that the obligation of the Company under this subsection (y) shall be deferred when no Placement Notice is pending or for any Suspension Period and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to deliver the required deliverable to the Manager at such time if it was not delivered at the last Representation Date).

 

(z) In connection with each Representation Date, the Company shall conduct a due diligence session, in form and substance reasonably satisfactory to the Manager, which shall include representatives of the management and the independent registered public accountants of the Company; provided that the obligation of the Company under this subsection (z) shall be deferred when no Placement Notice is pending or for any Suspension Period and shall recommence upon the termination of such Suspension Period and/or the Company’s submission of a Placement Notice to the Manager (in which case the Company shall be required to conduct a due diligence session at such time if it was not conducted at the last Representation Date); provided further that such due diligence session shall be requested and conducted solely by the Distribution Manager who is then offering or selling Shares of the Company pursuant to its Distribution Agreement for such Distribution Manager’s portion of the Maximum Amount. For the avoidance of doubt, all Distribution Managers shall be invited by the Company to participate in any due diligence session not requested and conducted by such Distribution Manager. The Company shall cooperate with any reasonable due diligence review conducted by the Manager (or its counsel or other representatives) from time to time (on a Representation Date or otherwise) in connection with the transactions contemplated by this Agreement, including, without limitation, providing information and making available documents and senior corporate officers, as the Manager may reasonably request; provided , however , that the Company shall be required to make available documents and senior corporate officers only (i) at the Company’s or Company Counsel’s principal offices and (ii) during the Company’s ordinary business hours.

 

(aa) The Company consents to the Manager trading in the Common Stock for the Manager’s own account and for the account of its clients at the same time as sales of the Shares occur pursuant to this Agreement.

 

(bb) If to the knowledge of the Company, any condition set forth in Section 6(a) or 6(j) of this Agreement shall not have been satisfied on the applicable Settlement Date or Time of Delivery, as the case may be, the Company shall offer to any person who has agreed to purchase the Shares from the Company as the result of an offer to purchase solicited by the Manager the right to refuse to purchase and pay for such Shares.

 

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(cc) The Company agrees that on such dates as the 1933 Act shall require, the Company will file a prospectus supplement with the Commission pursuant to Rule 497 under the 1933 Act, or otherwise include in a filed annual report on Form 10-K or quarterly report on Form 10-Q, which prospectus supplement, Form 10-K or Form 10-Q, as applicable, will set forth the number of the Shares sold through or to the Manager under this Agreement, the Net Proceeds to the Company and the compensation paid by the Company with respect to sales of the Shares pursuant to this Agreement during the relevant quarter.

 

(dd) The Company agrees to ensure that prior to instructing the Manager to sell Shares the Company shall have obtained all necessary corporate authority for the offer and sale of such Shares.

 

(ee) Each acceptance by the Company of an offer to purchase the Shares hereunder, and each execution and delivery by the Company of a Terms Agreement, shall be deemed to be an affirmation to the Manager that the representations and warranties of the Company contained in or made pursuant to this Agreement are true and correct as of the date of such acceptance or of such Terms Agreement as though made at and as of such date, and an undertaking that such representations and warranties will be true and correct as of the Settlement Date for the Shares relating to such acceptance or as of the Time of Delivery relating to such sale, as the case may be, as though made at and as of such date (except that such representations and warranties shall be deemed to relate to the Registration Statement and the Prospectus as amended and supplemented relating to such Shares).

 

SECTION 6. Conditions of Manager’s Obligations . The obligations of the Manager hereunder are subject to (i) the accuracy of the representations and warranties on the part of the Company, the Adviser and the Administrator on the date hereof, any applicable Representation Date, as of each Time of Sale and as of each Settlement Date and Time of Delivery, (ii) the performance by the Company, the Adviser and the Administrator of their obligations hereunder and (iii) to the following additional conditions precedent.

 

(a)  No stop order suspending the effectiveness of the Registration Statement shall have been issued under the 1933 Act or proceedings therefor initiated or threatened by the Commission, and any request on the part of the Commission for additional information shall have been complied with to the reasonable satisfaction of counsel to the Manager.  All filings related to the offering of the Shares with the Commission required by Rule 497 under the 1933 Act shall have been made within the applicable time period prescribed for such filing under the 1933 Act.

 

(b) Subsequent to the respective dates as of which information is given in the Registration Statement, the Basic Prospectus and the Prospectus, no material and adverse change, financial or otherwise (other than as referred to in the Registration Statement and Prospectus), in the business, condition or prospects of the Company, the Adviser or the Administrator, shall occur or become known and no transaction which is material and adverse to the Company, the Adviser or the Administrator (other than as referred to in the Registration Statement and Prospectus), shall have been entered into by the Company, the Adviser or the Administrator.

 

(c) Each of the Company, the Adviser and the Administrator shall deliver to the Manager, at every date specified in Section 5(s) of this Agreement, a certificate signed by the chief executive officer, president (or with respect to the Adviser and the Administrator, an authorized officer) and the chief financial or accounting officers of each of the Company, the Adviser and the Administrator of the Company, as the case may be, to the effect that (i) the representations and warranties of the Company, the Adviser or the Administrator, as the case may be, as set forth in this Agreement are true and correct as of the Representation Date, (ii) the Company, the Adviser or the Administrator, as the case may be, has performed such of its obligations under this Agreement as are to be performed at or before such Representation Date, and (iii) the conditions set forth in paragraphs (a) and (b) of Section 6 have been met. Each certificate shall also state that the Shares have been duly and validly authorized by the Company, that all corporate action required to be taken for the issuance and sale of the Shares has been validly and sufficiently taken, and that the Company’s board of directors or any other body with authority has not revoked, rescinded or otherwise modified or withdrawn such authorization or corporate action.

 

(d) The Company shall furnish to the Manager, at every date specified in Section 5(t) of this Agreement, opinions of Company Counsel and Regulatory Counsel, addressed to the Manager, and dated as of such date, and in form and substance reasonably satisfactory to the Manager, in substantially the form set forth in Exhibit A-1 and Exhibit A-2 hereto or as otherwise satisfactory to the Manager.

 

(e) The Company shall furnish to the Manager, at every date specified in Section 5(u) of this Agreement, an opinion of Maryland Counsel, addressed to the Manager, and dated as of such date, and in form and substance reasonably satisfactory to the Manager, in substantially the form set forth in Exhibit B hereto or as otherwise satisfactory to the Manager.

 

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(f) The Manager shall have received, at every date specified in Section 5(v) of this Agreement, a certificate of the Secretary or Assistant Secretary of the Company, the Adviser and the Administrator, dated as of such date, and in form and substance reasonably satisfactory to the Manager.

 

(g) The Manager shall have received, at every date specified in Section 5(w) of this Agreement, the favorable opinion of [               ], counsel to the Manager, dated as of such date, and in form and substance reasonably satisfactory to the Manager.

 

(h) At every date specified in Section 5(x) hereof, the Manager shall have received from the accountants of the Company letters dated the date of delivery thereof and addressed to the Manager in form and substance reasonably satisfactory to the Manager.

 

(i) The Company shall furnish to the Manager, at every date specified in Section 5(y) hereof, a certificate of the chief financial or chief accounting officer of the Company with respect to certain financial matters, dated the date of delivery thereof and addressed to the Manager in form and substance reasonably satisfactory to the Manager.

 

(j) At every date specified in Section 5(z) of this Agreement and on such other dates as reasonably requested by the Manager, the Company shall have conducted due diligence sessions, in form and substance reasonably satisfactory to the Manager, which shall include the participation of representatives of the management of the Company and the independent registered public accountants of the Company.

 

(k) The Shares shall have been approved for listing on the NASDAQ, subject only to notice of issuance at or prior to the Settlement Date or the Time of Delivery, as the case may be.

 

(l) FINRA shall have issued a customary no objections letter with respect to the Registration Statement.

 

SECTION 7. Indemnification .

 

(a) (1)  Indemnification of the Manager by the Company.   The Company agrees to indemnify and hold harmless the Manager, its affiliates, as such term is defined in Rule 501(b) under the 1933 Act (each, an “ Affiliate ”), its selling agents and each person, if any, who controls any Manager within the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act as follows:

 

(i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included in the Prospectus (or any amendment or supplement thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;

 

(ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 7(d) below) any such settlement is effected with the written consent of the Company;

 

(iii) against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Manager), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (i) above;

 

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provided , however , that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by such Manager expressly for use in the Registration Statement (or any amendment thereto) or the Prospectus (or any amendment or supplement thereto.

 

(2)  Indemnification of the Manager by the Adviser and the Administrator .  Each of the Adviser and the Administrator agrees, jointly and severally, to indemnify and hold harmless the Manager, its Affiliates, its selling agents and each person, if any, who controls any Manager within the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act as follows:

 

(i)              against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading or arising out of any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus or the Prospectus (or any amendment or supplement thereto), or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading to the extent the loss, liability, claim, damage and expense relates to information concerning the Adviser or the Administrator;

 

(ii)           against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission related to the Adviser or the Administrator or any such alleged untrue statement or omission related to the Adviser or the Administrator; provided that (subject to Section 7(d) below) any such settlement is effected with the written consent of the Company;

 

(iii)        against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel chosen by the Manager), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission related to the Adviser or the Administrator, or any such alleged untrue statement or omission related to the Adviser or the Administrator, to the extent that any such expense is not paid under (i) or (ii) above;

 

provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with written information furnished to the Company by such Manager expressly for use in the Registration Statement (or any amendment thereto), or the Prospectus (or any amendment or supplement thereto).

 

(b)  Indemnification of Company, Directors, Officers, Adviser and Administrator.   The Manager agrees to indemnify and hold harmless each of the Company, the Adviser and the Administrator, each of their directors and officers, and each person, if any, who controls the Company, the Adviser or the Administrator within the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section, as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto) or the Prospectus (or any amendment or supplement thereto) in reliance upon and in conformity with written information furnished to the Company by the Manager expressly for use in the Registration Statement (or any amendment thereto), or the Prospectus (or any amendment or supplement thereto).

 

(c)  Actions against Parties; Notification.   Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder (an “ Action ”), but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability hereunder to the extent it is not materially prejudiced as a result thereof and in any event shall not relieve it from any liability which it may have otherwise than on account of this indemnity agreement.  In the case of parties indemnified pursuant to Section 7(a) above, counsel to the indemnified parties shall be selected

 

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by the Manager, and, in the case of parties indemnified pursuant to Section 7(b) above, counsel to the indemnified parties shall be selected by the Company.  An indemnifying party may participate at its own expense in the defense of any such Action; provided , however , that counsel to the indemnifying party shall not (except with the consent of the indemnified party) also be counsel to the indemnified party.  In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one Action or separate but similar or related Actions in the same jurisdiction arising out of the same general allegations or circumstances.  No indemnifying party shall, without the prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever in respect of which indemnification or contribution could be sought under this Section 7 or Section 8 hereof (whether or not the indemnified parties are actual or potential parties thereto), unless such settlement, compromise or consent (i) includes an unconditional release of each indemnified party from all liability arising out of such litigation, investigation, proceeding or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.  Notwithstanding anything to the contrary herein, neither the assumption of the defense of any such Action nor the payment of any fees or expenses related thereto shall be deemed to be an admission by the indemnifying party that it has an obligation to indemnify any person pursuant to this Agreement.

 

(d)  Settlement Without Consent if Failure to Reimburse.   If at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 7(a)(1)(ii) or 7(a)(2)(ii) effected without its written consent if (i) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (ii) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (iii) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.

 

(e)  Acknowledgement by the Company, the Adviser and the Administrator .  The Company, the Adviser and the Administrator also acknowledge and agree that (i) the purchase and sale of any Shares pursuant to this Agreement, including any discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the Manager of such Shares, on the other hand, (ii) in connection with the offering of the Shares and the process leading to such transaction the Manager will act solely as a sales agent of the Company (unless provided otherwise pursuant to a Terms Agreement), (iii) the Manager will not assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering of the Shares contemplated hereby or the process leading thereto (irrespective of whether the Manager has advised or is currently advising the Company on other matters) and the Manager will not have any obligation to the Company with respect to the offering except the obligations expressly set forth herein, (iv) the Manager and its Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company, and (v) the Manager has not provided and will not provide any legal, accounting, regulatory or tax advice with respect to the offering of the Shares and the Company has consulted and will consult its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.

 

SECTION 8. Contribution .  If the indemnification provided for in Section 7 hereof is for any reason unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, liabilities, claims, damages or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount of such losses, liabilities, claims, damages and expenses incurred by such indemnified party, as incurred, (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, the Adviser and the Administrator on the one hand and the Manager on the other hand from the offering of the Shares pursuant to this Agreement or (ii) if the allocation provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, the Adviser and the Administrator on the one hand and of the Manager on the other hand in connection with the statements or omissions which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.

 

The relative benefits received by the Company, the Adviser and the Administrator on the one hand and the Manager on the other hand in connection with the offering of the Shares pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Shares pursuant to this Agreement (before deducting expenses) received by the Company and the total compensation received by the Manager pursuant

 

22


 

to the Distribution Agreements and any Terms Agreement or Alternative Terms Agreement, in each case as determined as of the date of such Action referred to in Section 7(a) or (b), as applicable which resulted in such losses, liabilities, claims, damages or expenses, as well as any other relevant equitable considerations.

 

The relative fault of the Company, the Adviser and the Administrator on the one hand and the Manager on the other hand shall be determined by reference to, among other things, whether any such untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company, the Adviser and the Administrator or by the Manager and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.

 

The Company, the Adviser, the Administrator and the Manager agree that it would not be just and equitable if contribution pursuant to this Section 8 were determined by pro rata allocation (even if the Distribution Managers were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this Section 8.  The aggregate amount of losses, liabilities, claims, damages and expenses incurred by an indemnified party and referred to above in this Section 8 shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue or alleged untrue statement or omission or alleged omission.

 

Notwithstanding the provisions of this Section 8, the Manager shall not be required to contribute any amount in excess of the amount by which the total price at which the Shares sold by it under this Agreement exceeds the amount of any damages which such Manager has otherwise been required to pay by reason of any such untrue or alleged untrue statement or omission or alleged omission.

 

No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

 

For purposes of this Section 8, each person, if any, who controls the Manager within the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act and the Manager’s Affiliates and selling agents shall have the same rights to contribution as such Manager, and each director of the Company, each officer of the Company, and each person, if any, who controls the Company, Adviser or Administrator within the meaning of Section 15 of the 1933 Act or Section 20 of the Exchange Act shall have the same rights to contribution as the Company, Adviser or Administrator, as the case may be.

 

Notwithstanding any other provision of Section 7 and this Section 8, no party shall be entitled to indemnification or contribution under this Agreement in violation of Section 17(i) of the 1940 Act.

 

SECTION 9. Representations, Warranties and Agreements to Survive Delivery . All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company, the Adviser and the Administrator submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation made by or on behalf of the Manager or its Affiliates or selling agents, any person controlling the Manager, its officers or directors or any person controlling the Company and (ii) delivery of and payment for the Shares.

 

SECTION 10. Termination .

 

(a) The Company shall have the right, by giving written notice as hereinafter specified, to terminate the provisions of this Agreement relating to the solicitation of offers to purchase the Shares in its sole discretion at any time. Any such termination shall be without liability of any party to any other party except that (i) if any of the Shares have been sold through the Manager for the Company, then Section 5(bb) shall remain in full force and effect, (ii) with respect to any pending sale, through the Manager for the Company, the obligations of the Company, the Adviser and the Administrator, including in respect of compensation of the Manager, shall remain in full force and effect notwithstanding the termination and (iii) the provisions of Sections 5(o), 7, 8, 9, 10, 11, 12, 13, 14 and 15 of this Agreement shall remain in full force and effect notwithstanding such termination.

 

23


 

(b) The Manager shall have the right, by giving written notice as hereinafter specified, to terminate the provisions of this Agreement relating to the solicitation of offers to purchase the Shares in its sole discretion at any time. Any such termination shall be without liability of any party to any other party except that the provisions of Sections 5(o), 7, 8, 9, 10, 11, 12, 13, 14 and 15 of this Agreement shall remain in full force and effect notwithstanding such termination.

 

(c) This Agreement shall remain in full force and effect unless terminated pursuant to Sections 10(a) or (b) above or otherwise by mutual agreement of the parties; provided that any such termination by mutual agreement shall in all cases be deemed to provide that the provisions of Sections 5(o), 7, 8, 9, 10, 11, 12, 13, 14 and 15 of this Agreement shall remain in full force and effect notwithstanding such termination.

 

(d) Any termination of this Agreement shall be effective on the date specified in such notice of termination; provided that such termination shall not be effective until the close of business on the date of receipt of such notice by the Manager or the Company, as the case may be. If such termination shall occur prior to the Settlement Date or Time of Delivery for any sale of the Shares, such sale shall settle in accordance with the provisions of Section 4(a)(vi) of this Agreement.

 

SECTION 11. Tax Disclosure .  Notwithstanding any other provision of this Agreement, from the commencement of discussions with respect to the transactions contemplated hereby, the Company (and each employee, representative or other agent of the Company) may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure (as such terms are used in Sections 6011, 6111 and 6112 of the U.S. Code and the Treasury Regulations promulgated thereunder) of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided relating to such tax treatment and tax structure.

 

SECTION 12. Notices . Except as otherwise herein provided, all statements, requests, notices and agreements under this Agreement shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication.  Notices to the Manager shall be directed to [               ], with a copy to [               ].  Notices to the Company, the Adviser and Administrator shall be directed to them at 245 Park Avenue, 44 th  Floor, New York, New York 10167, Attention: General Counsel, with a copy to Kirkland & Ellis LLP, 2029 Century Park East, 14th Floor, Los Angeles, CA 90067, Attention: Monica Shilling.

 

SECTION 13. Parties . This Agreement shall each inure to the benefit of and be binding upon the Manager and the Company and their respective successors.  Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any person, firm or corporation, other than the Manager, the Company, the Adviser and the Administrator and their respective successors and the controlling persons and officers and directors referred to in Sections 7 and 8 and their heirs and legal representatives, any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained.  This Agreement and all conditions and provisions hereof are intended to be for the sole and exclusive benefit of the Manager, the Company, the Adviser and the Administrator and their respective successors, and said controlling persons and officers and directors and their heirs and legal representatives, and for the benefit of no other person, firm or corporation.  No purchaser of Shares from any Manager shall be deemed to be a successor by reason merely of such purchase.

 

SECTION 14. Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of New York, including without limitation Section 5-1401 of the New York General Obligations Law.

 

SECTION 15. Submission to Jurisdiction .  Except as set forth below, no claim or action may be commenced, prosecuted or continued in any court other than the courts of the State of New York located in the City and County of New York or in the United States District Court for the Southern District of New York, which courts shall have jurisdiction over the adjudication of such matters, and both the Manager and the Company consent to the jurisdiction of such courts and personal service with respect thereto.  The Company hereby consents to personal jurisdiction, service and venue in any court in which any claim or action arising out of or in any way relating to this Agreement is brought by any third party against the Manager or any indemnified party.  The Manager and the Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) waive all right to trial by jury in any action, proceeding or counterclaim (whether based upon contract, tort or otherwise) in any way arising out of or relating to this Agreement.

 

24


 

SECTION 16. Counterparts . This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.

 

SECTION 17. Effect of Headings .  The Section headings herein are for convenience only and shall not affect the construction hereof.

 

SECTION 18. USA Patriot Act . In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), the Manager is required to obtain, verify and record information that identifies their respective clients, including the Company, which information may include the name and address of their respective clients, as well as other information that will allow the Manager to properly identify its clients.

 

SECTION 19. Recognition of the U.S. Special Resolution Regimes .

 

(a) In the event that any Manager that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from such Manager of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.

 

(b) In the event that any Manager that is a Covered Entity or a BHC Act Affiliate of such Manager becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against such Manager are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States.

 

“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).

 

“Covered Entity” means any of the following: (i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

 

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

 

“U.S. Special Resolution Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

 

[Signature Pages Follow]

 

25


 

If the foregoing correctly sets forth the understanding among the Company, the Adviser, the Administrator and the Manager, please so indicate in the space provided below for that purpose, whereupon this Agreement and your acceptance shall constitute a binding agreement among the Company, the Adviser, the Administrator and the Manager. Alternatively, the execution of this Agreement by the Company, the Adviser and the Administrator and its acceptance by or on behalf of the Manager may be evidenced by an exchange of telegraphic or other written communications.

 

 

 

Very truly yours,

 

 

 

 

 

COMPANY:

 

 

ARES CAPITAL CORPORATION

 

 

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

ADVISER:

 

 

ARES CAPITAL MANAGEMENT LLC

 

 

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

ADMINISTRATOR:

 

 

ARES OPERATIONS LLC

 

 

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

ACCEPTED as of the date first above written

 

 

 

 

 

[BANK]

 

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

26


 

Annex I

 

[FORM OF TERMS AGREEMENT]

 

Ares Capital Corporation

 

[    ] Shares of Common Stock
(par value $0.001 per share)

 

TERMS AGREEMENT

 

[DATE]

 

[Insert Bank & Address]

 

Ladies and Gentlemen:

 

Ares Capital Corporation, a Maryland corporation (the “ Company ”), proposes, subject to the terms and conditions stated herein and in the Equity Distribution Agreement, dated [Month] [Day], [Year] (the “ Equity Distribution Agreement ”), by and among the Company, the Adviser, the Administrator (each as defined therein) and [Bank] (the “ Manager ”), to issue and sell to the Manager the securities specified in Schedule I hereto (the “ Purchased Securities ”)[, and solely for the purpose of covering over-allotments, to grant to the Manager the option to purchase the additional securities specified in Schedule I hereto (the “ Additional Securities ”)].

 

[The Manager shall have the right to purchase from the Company all or a portion of the Additional Securities as may be necessary to cover over-allotments made in connection with the offering of the Purchased Securities, at the same purchase price per share to be paid by the Manager to the Company for the Purchased Securities. This option may be exercised by the Manager at any time (but not more than once) on or before the 30th day following the date hereof, by written notice to the Company. Such notice shall set forth the aggregate number of Additional Securities as to which the option is being exercised, and the date and time when the Additional Securities are to be delivered (such date and time being herein referred to as the “ Option Closing Date ”); provided, however, that the Option Closing Date shall not be earlier than the Time of Delivery (as set forth in Schedule I hereto) nor earlier than the second business day after the date on which the option shall have been exercised nor later than the fifth business day after the date on which the option shall have been exercised. Payment of the purchase price for the Additional Securities shall be made at the Option Closing Date in the same manner and at the same office as the payment for the Purchased Securities.]

 

Each of the provisions of the Equity Distribution Agreement not specifically related to the solicitation by the Manager, as agent of the Company, of offers to purchase securities is incorporated herein by reference in its entirety, and shall be deemed to be part of this Terms Agreement to the same extent as if such provisions had been set forth in full herein. Each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Terms Agreement[ and][,] the Time of Delivery[ and any Option Closing Date], except that each representation and warranty in Section 2 and Section 3 of the Equity Distribution Agreement which makes reference to the Prospectus (as therein defined) shall be deemed to be a representation and warranty as of the date of the Equity Distribution Agreement in relation to the Prospectus, and also a representation and warranty as of the date of this Terms Agreement[ and] [,] the Time of Delivery[ and any Option Closing Date] in relation to the Prospectus as amended and supplemented to relate to the Purchased Securities.

 

[An amendment to the Registration Statement (as defined in the Equity Distribution Agreement), or a supplement to the Prospectus, as the case may be, relating to the Purchased Securities[ and the Additional Securities], in the form heretofore delivered to the Manager is now proposed to be filed with the Commission.]

 

Subject to the terms and conditions set forth herein and in the Equity Distribution Agreement which are incorporated herein by reference, the Company agrees to issue and sell to the Manager and the latter agrees to purchase from the Company the number of shares of the Purchased Securities at the time and place and at the purchase price set forth in Schedule I hereto.

 

All capitalized terms used herein and not otherwise defined shall have the respective meanings assigned to them in the Equity Distribution Agreement.

 

[ The remainder of this page is intentionally left blank ]

 

27


 

If the foregoing is in accordance with your understanding, please sign and return to us a counterpart hereof, whereupon this Terms Agreement, including those provisions of the Equity Distribution Agreement incorporated herein by reference, shall constitute a binding agreement among the Manager, the Company the Adviser and the Administrator.

 

 

 

 

Very truly yours,

 

 

 

 

 

COMPANY:

 

 

ARES CAPITAL CORPORATION

 

 

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

ADVISER:

 

 

ARES CAPITAL MANAGEMENT LLC

 

 

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

ADMINISTRATOR:

 

 

ARES OPERATIONS LLC

 

 

 

 

 

 

 

 

By

 

 

 

 

Name:

 

 

 

Title:

 

 

 

ACCEPTED as of the date first above written

 

 

 

 

 

[Bank]

 

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

28


 

Schedule I to the Terms Agreement

 

Title of Purchased Securities[ and Additional Securities]:

 

Common Stock, par value $0.001 per share

 

Number of Purchased Securities:

 

[Number of Additional Securities:]

 

[Price to Public:]

 

Purchase Price by the Manager:

 

Method of and Specified Funds for Payment of Purchase Price:

 

By wire transfer to a bank account specified by the Company in same day funds.

 

Method of Delivery:

 

Free delivery of the Shares to the Manager’s account at The Depository Trust Company in return for payment of the Purchase Price.

 

Time of Delivery:

 

Closing Location:

 

Documents to be Delivered:

 

The following documents referred to in the Equity Distribution Agreement shall be delivered as a condition to closing at the time of execution of this Terms Agreement:

 

(1) The accountants’ letter referred to in Section 5(x).

(2) The certificate referred to in Section 5(s).

 

The following documents referred to in the Equity Distribution Agreement shall be delivered as a condition to closing at the Time of Delivery[ and on any Option Closing Date]:

 

(1) The officers’ certificates referred to in Section 5(s).

(2) The opinions referred to in Section 5(t).

(3) The opinion referred to in Section 5(u).

(4) The certificates referred to in Section 5(v).

(5) The opinion referred to in Section 5(w).

(6) The accountants’ letter referred to in Section 5(x).

(7) The certificate referred to in Section 5(y).

(8) Such other documents as the Manager shall reasonably request.

 

29


 

Schedule A

 

ALTERNATIVE MANAGERS

 

[Bank 1]

[Bank 2]

 

30


 

Schedule B

 

ARES CAPITAL CORPORATION

 

CONSOLIDATED SUBSIDIARIES

 

[To be provided]

 

31


 

Schedule C

 

AUTHORIZED COMPANY REPRESENTATIVES

 

32


 

Exhibit A-1

 

FORM OF OPINION OF KIRKLAND & ELLIS LLP

 

33


 

Exhibit A-2

 

FORM OF OPINION OF EVERSHEDS SUTHERLAND (US) LLP

 

34


 

Exhibit B

 

FORM OF OPINION OF VENABLE LLP

 

35




Exhibit (l)(1)

 

 

 

May 22, 2019

 

Ares Capital Corporation

245 Park Avenue, 44 th  Floor

New York, New York 10167

 

Re:          Registration Statement on Form N-2 (File No. 333-230351)

 

Ladies and Gentlemen:

 

We have served as Maryland counsel to Ares Capital Corporation, a Maryland corporation (the “Company”), and a business development company under the Investment Company Act of 1940, as amended (the “1940 Act”), in connection with certain matters of Maryland law arising out of the registration of the following securities having an aggregate initial offering price of up to $3,000,000,000 (collectively, the “Securities”):  (a) shares of common stock, par value $.001 per share (the “Common Stock”); (b) shares of preferred stock, par value $.001 per share (the “Preferred Stock”); (c) debt securities (the “Debt Securities”); (d) subscription rights to purchase Common Stock (the “Rights”); (e) warrants representing rights to purchase Common Stock, Preferred Stock or Debt Securities (the “Warrants”); and (f) units comprised of any combination of the foregoing Securities (the “Units”), as set forth in the Prospectus (as defined herein), as supplemented by one or more supplements to the Prospectus.

 

In connection with our representation of the Company, and as a basis for the opinion hereinafter set forth, we have examined originals, or copies certified or otherwise identified to our satisfaction, of the following documents (hereinafter collectively referred to as the “Documents”):

 

1.             The Registration Statement (the “Registration Statement”) and the form of prospectus included therein (the “Prospectus”), substantially in the form transmitted to the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “1933 Act”);

 

2.             The charter of the Company (the “Charter”), certified by the State Department of Assessments and Taxation of Maryland (the “SDAT”);

 

3.             The Third Amended and Restated Bylaws of the Company (the “Bylaws”), certified as of the date hereof by an officer of the Company;

 


 

4.             A certificate of the SDAT as to the good standing of the Company, dated as of a recent date;

 

5.             Resolutions adopted by the Board of Directors of the Company (the “Board”) relating to the registration of the Securities (the “Resolutions”), certified as of the date hereof by an officer of the Company;

 

6.             A certificate executed by an officer of the Company, dated as of the date hereof; and

 

7.             Such other documents and matters as we have deemed necessary or appropriate to express the opinion set forth below, subject to the assumptions, limitations and qualifications stated herein.

 

In expressing the opinion set forth below, we have assumed the following:

 

1.             Each individual executing any of the Documents, whether on behalf of such individual or another person, is legally competent to do so.

 

2.             Each individual executing any of the Documents on behalf of a party (other than the Company) is duly authorized to do so.

 

3.             Each of the parties (other than the Company) executing any of the Documents has duly and validly executed and delivered each of the Documents to which such party is a signatory, and such party’s obligations set forth therein are legal, valid and binding and are enforceable in accordance with all stated terms.

 

4.             All Documents submitted to us as originals are authentic.  The form and content of all Documents submitted to us as unexecuted drafts do not differ in any respect relevant to this opinion from the form and content of such Documents as executed and delivered.  All Documents submitted to us as certified or photostatic copies conform to the original documents.  All signatures on all Documents are genuine.  All public records reviewed or relied upon by us or on our behalf are true and complete.  All representations, warranties, statements and information contained in the Documents are true and complete.  There has been no oral or written modification of or amendment to any of the Documents, and there has been no waiver of any provision of any of the Documents, by action or omission of the parties or otherwise.

 

5.             The issuance of, and certain terms of, the Securities to be issued by the Company from time to time will be authorized and approved by the Board, or a duly authorized

 

2


 

committee thereof, in accordance with the Maryland General Corporation Law, the Charter, the Bylaws and the Resolutions (such approval referred to herein as the “Corporate Proceedings”).

 

6.             Articles Supplementary creating and designating the number of shares and the terms of any class or series of Preferred Stock to be issued by the Company will be filed with and accepted for record by the SDAT prior to the issuance of such Preferred Stock.

 

7.             Upon the issuance of any Securities that are shares of Common Stock (“Common Securities”), including Common Securities which may be issued upon conversion or exercise of any other Securities convertible into or exercisable for Common Securities, the total number of shares of Common Stock issued and outstanding will not exceed the total number of shares of Common Stock that the Company is then authorized to issue under the Charter.

 

8.             Upon the issuance of any Securities that are shares of Preferred Stock (“Preferred Securities”), including Preferred Securities which may be issued upon conversion or exercise of any other Securities convertible into or exercisable for Preferred Securities, the total number of shares of Preferred Stock issued and outstanding, and the total number of issued and outstanding shares of the applicable class or series of Preferred Stock designated pursuant to the Charter, will not exceed the total number of shares of Preferred Stock or the number of shares of such class or series of Preferred Stock that the Company is then authorized to issue under the Charter.

 

Based upon the foregoing, and subject to the assumptions, limitations and qualifications stated herein, it is our opinion that:

 

1.             The Company is a corporation duly incorporated and existing under and by virtue of the laws of the State of Maryland and is in good standing with the SDAT.

 

2.             Upon the completion of all Corporate Proceedings relating to Common Securities, the issuance of the Common Securities will be duly authorized and, when and if issued and delivered against payment therefor in accordance with the Registration Statement, the Resolutions and the Corporate Proceedings, the Common Securities will be validly issued, fully paid and nonassessable.

 

3.             Upon the completion of all Corporate Proceedings relating to Preferred Securities, the issuance of the Preferred Securities will be duly authorized and, when and if issued and delivered against payment therefor in accordance with the Registration Statement, the Resolutions and the Corporate Proceedings, the Preferred Securities will be validly issued, fully paid and nonassessable.

 

3


 

4.             Upon the completion of all Corporate Proceedings relating to the Securities that are Debt Securities, the issuance of the Debt Securities will be duly authorized.

 

5.             Upon the completion of all Corporate Proceedings relating to the Securities that are Rights, the issuance of the Rights will be duly authorized.

 

6.             Upon the completion of all Corporate Proceedings relating to the Securities that are Warrants, the issuance of the Warrants will be duly authorized.

 

7.             Upon the completion of all Corporate Proceedings relating to the Securities that are Units, the issuance of the Units will be duly authorized.

 

The foregoing opinion is limited to the laws of the State of Maryland and we do not express any opinion herein concerning federal law or the laws of any other state.  We express no opinion as to the applicability or effect of federal or state securities laws, including the securities laws of the State of Maryland, or the 1940 Act.  To the extent that any matter as to which our opinion is expressed herein would be governed by the laws of any jurisdiction other than the State of Maryland, we do not express any opinion on such matter.  The opinion expressed herein is subject to the effect of any judicial decision which may permit the introduction of parol evidence to modify the terms or the interpretation of agreements.

 

The opinion expressed herein is limited to the matters specifically set forth herein and no other opinion shall be inferred beyond the matters expressly stated.  We assume no obligation to supplement this opinion if any applicable law changes after the date hereof or if we become aware of any fact that might change the opinion expressed herein after the date hereof.

 

This opinion is being furnished to you for submission to the Commission as an exhibit to the Registration Statement.  We hereby consent to the filing of this opinion as an exhibit to the Registration Statement and to the use of the name of our firm therein.  In giving this consent, we do not admit that we are within the category of persons whose consent is required by Section 7 of the 1933 Act.

 

 

Very truly yours,

 

 

 

/s/ Venable LLP

 

4




Exhibit (l)(2)

 

 

 

 

 

 

 

333 South Hope Street
Los Angeles, CA 90071
United States

(213) 680-8400

www.kirkland.com

Facsimile:
(213) 680-8500

 

May 22, 2019

 

Ares Capital Corporation

245 Park Avenue, 44th Floor

New York, New York 10167

 

Re: Registration Statement of Ares Capital Corporation on Form N-2

 

Ladies and Gentlemen:

 

We are issuing this opinion letter in our capacity as special counsel to Ares Capital Corporation, a Maryland corporation (the “ Company ”), in connection with the preparation of a registration statement on Form N-2, as amended (the “ Registration Statement ”), initially filed with the Securities and Exchange Commission (the “ Commission ”) on March 18, 2019, relating to the issuance and sale from time to time, pursuant to Rule 415 of the General Rules and Regulations promulgated under the Securities Act of 1933, as amended (the “ Securities Act ”), by the Company of the following securities (the “ Securities ”) of the Company with an aggregate offering price of up to $3,000,000,000 or the equivalent thereof in one or more foreign currencies: (i) debt securities (the “ Debt Securities ”), (ii) preferred stock (the “ Preferred Stock ”), (iii) common stock, par value $.001 per share (the “ Common Stock ”), (iv) warrants representing rights to purchase Common Stock, Preferred Stock or Debt Securities, separately or as units comprised of any combination of the foregoing, (v) subscription rights to purchase Common Stock and (vi) units including a combination of any of the foregoing securities. The offering of the Securities will be as set forth in the prospectus contained in the Registration Statement (the “ Prospectus ”), as supplemented by one or more supplements to the Prospectus.

 

The Debt Securities will be issued in one or more series pursuant to the Indenture dated as of October 21, 2010 (the “ Existing Indenture ”), between the Company and U.S. Bank National Association, as trustee (the “ Existing Trustee ”), and any supplemental indenture, as may be agreed from time to time between the Company and the Existing Trustee, or pursuant to an indenture (together with the Existing Indenture, in each case as may be amended and supplemented from time to time, the “ Indenture ”), between the Company and a trustee (together with the Existing Trustee, the “ Trustee ”).

 

As such counsel, we have examined originals, or copies certified or otherwise identified to our satisfaction, of such documents, corporate records and other instruments as we have deemed necessary for the purposes of this opinion, including (i) the Registration Statement to which this letter is an exhibit, (ii) the Indenture and (iii) such corporate records of the Company, certificates of public officials, officers of the Company and other persons, and such other documents, agreements and instruments as we have

 


 

deemed necessary as a basis for the opinions hereinafter expressed.

 

For purposes of this opinion, we have assumed the authenticity of all documents submitted to us as originals, the conformity to the originals of all documents submitted to us as copies and the authenticity of the originals of all such documents submitted to us as copies. We have also assumed the genuineness of the signatures of persons signing all documents in connection with which this opinion is rendered, the authority of such persons signing on behalf of the parties thereto, and the due authorization, execution and delivery of all documents by the parties thereto. As to any facts material to the opinions expressed herein that we have not independently established or verified, we have relied upon statements and representations of officers and other representatives of the Company, public officials and others.

 

Our opinion expressed below is subject to the qualifications that we express no opinion as to the applicability of, compliance with, or effect of (i) any bankruptcy, insolvency, reorganization, fraudulent transfer, fraudulent conveyance, moratorium or other similar law affecting the enforcement of creditors’ rights generally, (ii) general principals of equity (regardless of whether enforcement is considered in a proceeding in equity or at law) and (iii) public policy considerations that may limit the rights of parties to obtain certain remedies.

 

Based upon and subject to the foregoing qualifications, assumptions and limitations and the further limitations set forth below, we are of the opinion that when (i) the Indenture has been duly authorized, executed and delivered by each of the Company and the Trustee, (ii) the final terms of the Debt Securities are duly established and authorized for issuance by all necessary corporate action on the part of the Company, (iii) the Securities have been duly executed by the Company and authenticated by the Trustee in accordance with the provisions of the Indenture, delivered to and paid for by the purchasers thereof pursuant to the documents governing their issuance and sale and (iv) the terms of the Debt Securities as established comply with the requirements of the Investment Company Act of 1940, as amended, the Securities will be validly issued and binding obligations of the Company, enforceable against the Company in accordance with the terms thereof and will be entitled to the benefits of the Indenture.

 

We hereby consent to the filing of this opinion as Exhibit (l)(2) to the Registration Statement. We also consent to the reference to our firm under the heading “Legal Matters” in the Registration Statement. In giving this consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission promulgated thereunder.

 

Our advice on every legal issue addressed in this letter is based exclusively on the internal law of the State of New York and represents our opinion as to how that issue would be resolved were it to be considered by the highest court in the jurisdiction which enacted such law. The manner in which any particular issue relating to the opinions would be treated in any actual court case would depend in part on facts and circumstances particular to the case and would also depend on how the court involved chose to exercise the wide discretionary authority generally available to it. None of the opinions or other advice contained in this letter considers or covers any foreign or state securities (or “blue sky”) laws or regulations.

 

This opinion is limited to the specific issues addressed herein, and no opinion may be inferred or implied beyond that expressly stated herein. This opinion speaks only as of the date hereof and we assume no obligation to revise or supplement this opinion.

 

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We have also assumed that the execution and delivery of the Indenture and the Debt Securities and the performance by the Company of its obligations thereunder do not and will not violate, conflict with or constitute a default under any agreement or instrument to which the Company is bound.

 

This opinion is furnished to you in accordance with the requirements of subparagraph (l) of Item 25.2 of Part C of Form N-2, and is not to be used, circulated, quoted or otherwise relied upon for any other purposes.

 

 

 

 

Very truly yours,

 

 

 

/s/ Kirkland & Ellis LLP

 

 

 

KIRKLAND & ELLIS LLP

 

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Exhibit (n)(1)

 

Consent of Independent Registered Public Accounting Firm

 

The Board of Directors
Ares Capital Corporation

 

We consent to the use of our reports with respect to the consolidated financial statements and the effectiveness of internal control over financial reporting included herein, our report on the senior securities table included herein and to the references to our firm under the headings “Selected Condensed Consolidated Financial Data of Ares Capital,” “Senior Securities,” and “Independent Registered Public Accounting Firm” in the registration statement.

 

 

/s/ KPMG LLP

 

Los Angeles, California
May 22, 2019