BLUE OWL CAPITAL CORPORATION The information contained in this section should be read in conjunction with "ITEM 8. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA". This discussion contains forward-looking statements, which relate to future events or the future performance or financial condition ofOwl Rock Capital Corporation and involves numerous risks and uncertainties, including, but not limited to, those described in "ITEM 1A. RISK FACTORS." This discussion also should be read in conjunction with the "Cautionary Statement Regarding Forward Looking Statements" set forth on page 1 of this Annual Report on Form 10-K. Actual results could differ materially from those implied or expressed in any forward-looking statements.
Overview
Owl Rock Capital Corporation (the "Company", "we", "us" or "our") is aMaryland corporation formed onOctober 15, 2015 . We were formed primarily to originate and make loans to, and make debt and equity investments in,U.S. middle market companies. We invest in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity and equity-related securities including warrants, preferred stock and similar forms of senior equity, which may or may not be convertible into a portfolio company's common equity. Our investment objective is to generate current income, and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. We are managed byOwl Rock Capital Advisors LLC ("the Adviser" or "our Adviser"). The Adviser is registered with theU.S. Securities and Exchange Commission (the "SEC") as an investment adviser under the Investment Advisers Act of 1940, as amended (the "Advisers Act"), an indirect subsidiary of Blue Owl Capital Inc. ("Blue Owl") (NYSE: OWL) and part of Owl Rock, a division of Blue Owl focused on direct lending. Subject to the overall supervision of our board of directors ("the Board" or "our Board"), the Adviser manages our day-to-day operations, and provides investment advisory and management services to us. The Adviser or its affiliates may engage in certain origination activities and receive attendant arrangement, structuring or similar fees. The Adviser is responsible for managing our business and activities, including sourcing investment opportunities, conducting research, performing diligence on potential investments, structuring our investments, and monitoring our portfolio companies on an ongoing basis through a team of investment professionals. OnJuly 22, 2019 , we closed our initial public offering ("IPO"), issuing 10 million shares of our common stock at a public offering price of$15.30 per share, and onAugust 2, 2019 , the underwriters exercised their option to purchase an additional 1.5 million shares of common stock at a purchase price of$15.30 per share. Net of underwriting fees and offering costs, we received total cash proceeds of$164.0 million . Our common stock began trading on theNew York Stock Exchange ("NYSE") under the symbol "ORCC" onJuly 18, 2019 . In connection with the IPO, onJuly 22, 2019 , we entered into a stock repurchase plan (the "Company 10b5-1 Plan"), to acquire up to$150 million in the aggregate of our common stock at prices below its net asset value per share over a specified period, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Under the Company 10b5-1 Plan, we acquired 12,515,624 shares for approximately$150 million . The Company 10b5-1 Plan commenced onAugust 19, 2019 and was exhausted onAugust 4, 2020 .
The Adviser also serves as investment adviser to
Blue Owl consists of three divisions: Owl Rock, which focuses on direct lending, Dyal, which focuses on providing capital to institutional alternative asset managers andOak Street , which focuses on real estate strategies. Owl Rock is comprised of the Adviser,Owl Rock Technology Advisors LLC ("ORTA"),Owl Rock Technology Advisors II LLC ("ORTA II"),Owl Rock Capital Private Fund Advisors LLC ("ORPFA") andOwl Rock Diversified Advisors LLC ("ORDA" and together with the Adviser, ORTA,ORTA II , ORPFA and ORDA, the "Owl Rock Advisers"), which also are investment advisers. We may be prohibited under the 1940 Act from participating in certain transactions with our affiliates without the prior approval of our directorswho are not interested persons and, in some cases, the prior approval of theSEC . We, our Adviser and certain affiliates have been granted exemptive relief by theSEC to permit us to co-invest with other funds managed by our Adviser or certain of its affiliates, in a manner consistent with our investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. Pursuant to such exemptive relief, we generally are permitted to co-invest with certain of our affiliates if a "required majority" (as defined in Section 57(o) of the 1940 Act of our independent directors make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transactions, including the consideration to be paid, are reasonable and fair to us and our shareholders and do not involve overreaching by us or our shareholders on the part of any person concerned, (2) the transaction is consistent with the interests of our shareholders and is consistent with our investment objective and strategies, (3) the investment by our affiliates would not disadvantage us, and our participation would not be on a basis different from or less advantageous than that on which our affiliates are investing and (4) the proposed investment by us would not benefit our Adviser or its affiliates or any affiliated person of any of them (other than the parties to the transaction), except to the extent permitted by the exemptive relief and applicable law, including the limitations set forth in Section 57(k) of the 1940 Act. In addition, pursuant to an exemptive order issued by theSEC onApril 8, 2020 and applicable to all BDCs, throughDecember 31, 2020 , we were permitted, subject to the satisfaction of certain conditions, to complete follow-on investments in our existing portfolio companies with certain private funds managed by the Adviser or its affiliates and covered by our exemptive relief, even if such private funds had not previously invested in such existing portfolio company. Without this order, private funds would generally not be able to participate in such follow-on investments with us unless the private funds had previously acquired securities of the portfolio company in a co-investment transaction with us. Although the 76 -------------------------------------------------------------------------------- conditional exemptive order has expired, theSEC's Division of Investment Management has indicated that untilMarch 31, 2022 , it will not recommend enforcement action, to the extent that any BDC with an existing co-investment order continues to engage in certain transactions described in the conditional exemptive order, pursuant to the same terms and conditions described therein. The Owl Rock Advisers' investment allocation policy seeks to ensure equitable allocation of investment opportunities over time between us and other funds managed by our Adviser or its affiliates. As a result of the exemptive relief, there could be significant overlap in our investment portfolio and the investment portfolio of the Owl Rock Clients and/or other funds managed by the Adviser or its affiliates that could avail themselves of the exemptive relief and that have an investment objective similar to ours. OnApril 27, 2016 , we formed a wholly-owned subsidiary,OR Lending LLC , aDelaware limited liability company, which holds aCalifornia finance lenders license. ORLending LLC makes loans to borrowers headquartered inCalifornia . From time to time we may form wholly-owned subsidiaries to facilitate our normal course of business.
Certain consolidated subsidiaries of ours are subject to
We have elected to be regulated as a BDC under the 1940 Act and as a regulated
investment company ("RIC") for tax purposes under the Internal Revenue Code of
1986, as amended (the "Code"). As a result, we are required to comply with
various statutory and regulatory requirements, such as:
•
the requirement to invest at least 70% of our assets in "qualifying assets", as such term is defined in the 1940 Act;
•
source of income limitations;
•
asset diversification requirements; and
•
the requirement to distribute (or be treated as distributing) in each taxable year at least 90% of our investment company taxable income and tax-exempt interest for that taxable year.
COVID-19 Developments
InMarch 2020 , the outbreak of COVID -19 was recognized as a pandemic by theWorld Health Organization . In response to the outbreak, our Adviser instituted a work from home policy and began monitoring the ability of its employees to safely return to the office. InOctober 2021 , the Adviser implemented a return to in-office work policy across all of its offices. The policy encourages a return to in-office work but allows for flexibility to work from home based on current conditions. We have and continue to assess the impact of COVID-19 on our portfolio companies. We cannot predict the full impact of the COVID-19 pandemic, including its duration inthe United States and worldwide, the effectiveness of governmental responses designed to mitigate strain to businesses and the economy and the magnitude of the economic impact of the outbreak. The COVID-19 pandemic and preventative measures taken to contain or mitigate its spread have caused, and are continuing to cause, business shutdowns and cancellations of events and travel. In addition, while economic activity remains healthy and well improved from the beginning of the COVID-19 pandemic, we continue to observe supply chain interruptions, labor difficulties, commodity inflation and elements of economic and financial market instability both globally and inthe United States . We have built our portfolio management team to include workout experts and continue to closely monitor our portfolio companies; however, we are unable to predict the duration of any business and supply-chain disruptions or labor difficulties, the extent to which COVID-19 will negatively affect our portfolio companies' operating results or the impact that such disruptions may have on our results of operations and financial condition.
Our Investment Framework
We are aMaryland corporation organized primarily to originate and make loans to, and make debt and equity investments in,U.S. middle market companies. Our investment objective is to generate current income, and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. Since our Adviser and its affiliates began investment activities inApril 2016 throughDecember 31, 2021 , our Adviser and its affiliates have originated$51.2 billion aggregate principal amount of investments, of which$48.2 billion of aggregate principal amount of investments prior to any subsequent exits or repayments, was retained by either us or a corporation or fund advised by our Adviser or its affiliates. We seek to generate current income primarily inU.S. middle market companies through direct originations of senior secured loans or originations of unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, investments in equity and equity-related securities including warrants, preferred stock and similar forms of senior equity. Our equity investments are typically not control-oriented investments and we may structure such equity investments to include provisions protecting our rights as a minority-interest holder. We define "middle market companies" generally to mean companies with earnings before interest expense, income tax expense, depreciation and amortization, or "EBITDA," between$10 million and$250 million annually and/or annual revenue of$50 million to$2.5 billion at the time of investment, although we may on occasion invest in smaller or larger companies if an opportunity presents itself. We generally seek to invest in companies with a loan-to-value ratio of 50% or below. We expect that generally our portfolio composition will be majority debt or income producing securities, which may include "covenant-lite" loans (as defined below), with a lesser allocation to equity or equity-linked opportunities, which we may hold directly or 77 -------------------------------------------------------------------------------- through special purpose vehicles. In addition, we may invest a portion of our portfolio in opportunistic investments and broadly syndicated loans, which will not be our primary focus, but will be intended to enhance returns to our shareholders. These investments may include high-yield bonds and broadly-syndicated loans, including publicly traded debt instruments. In addition, we generally do not intend to invest more than 20% of our total assets in companies whose principal place of business is outsidethe United States , although we do not generally intend to invest in companies whose principal place of business is in an emerging market. Our portfolio composition may fluctuate from time to time based on market conditions and interest rates. Covenants are contractual restrictions that lenders place on companies to limit the corporate actions a company may pursue. Generally, the loans in which we expect to invest will have financial maintenance covenants, which are used to proactively address materially adverse changes in a portfolio company's financial performance. However, to a lesser extent, we may invest in "covenant-lite" loans. We use the term "covenant-lite" to refer generally to loans that do not have a complete set of financial maintenance covenants. Generally, "covenant-lite" loans provide borrower companies more freedom to negatively impact lenders because their covenants are incurrence-based, which means they are only tested and can only be breached following an affirmative action of the borrower, rather than by a deterioration in the borrower's financial condition. Accordingly, to the extent we invest in "covenant-lite" loans, we may have fewer rights against a borrower and may have a greater risk of loss on such investments as compared to investments in or exposure to loans with financial maintenance covenants. We target portfolio companies where we can structure larger transactions. As ofDecember 31, 2021 , our average debt investment size in each of our portfolio companies was approximately$85.7 million based on fair value. As ofDecember 31, 2021 , our portfolio companies, excluding the investment in ORCC SLF and certain investments that fall outside of our typical borrower profile and represent 84.8% of our total debt portfolio based on fair value, had weighted average annual revenue of$632 million and weighted average annual EBITDA of$136 million . The companies in which we invest use our capital to support their growth, acquisitions, market or product expansion, refinancings and/or recapitalizations. The debt in which we invest typically is not rated by any rating agency, but if these instruments were rated, they would likely receive a rating of below investment grade (that is, below BBB- or Baa3), which is often referred to as "high yield" or "junk".
Key Components of Our Results of Operations
Investments
We focus primarily on the direct origination of loans to middle market companies
domiciled in
Our level of investment activity (both the number of investments and the size of each investment) can and will vary substantially from period to period depending on many factors, including the amount of debt and equity capital available to middle market companies, the level of merger and acquisition activity for such companies, the general economic environment and the competitive environment for the types of investments we make.
In addition, as part of our risk strategy on investments, we may reduce the levels of certain investments through partial sales or syndication to additional lenders.
Revenues We generate revenues primarily in the form of interest income from the investments we hold. In addition, we generate income from dividends on either direct equity investments or equity interests obtained in connection with originating loans, such as options, warrants or conversion rights. Our debt investments typically have a term of three to ten years. As ofDecember 31, 2021 , 98.9% of our debt investments based on fair value bear interest at a floating rate, subject to interest rate floors, in certain cases. Interest on our debt investments is generally payable either monthly or quarterly. Our investment portfolio consists primarily of floating rate loans, and our credit facilities bear interest at floating rates. Macro trends in base interest rates like London Interbank Offered Rate ("LIBOR"), the Secured Overnight Financing Rate ("SOFR") and any alternative reference rates may affect our net investment income over the long term. However, because we generally originate loans to a small number of portfolio companies each quarter, and those investments vary in size, our results in any given period, including the interest rate on investments that were sold or repaid in a period compared to the interest rate of new investments made during that period, often are idiosyncratic, and reflect the characteristics of the particular portfolio companies that we invested in or exited during the period and not necessarily any trends in our business or macro trends. Loan origination fees, original issue discount and market discount or premium are capitalized, and we accrete or amortize such amounts underU.S. generally accepted accounting principles ("U.S. GAAP") as interest income using the effective yield method for term instruments and the straight-line method for revolving or delayed draw instruments. Repayments of our debt investments can reduce interest income from period to period. The frequency or volume of these repayments may fluctuate significantly. We record prepayment premiums on loans as interest income. We may also generate revenue in the form of commitment, loan origination, structuring, or due diligence fees, fees for providing managerial assistance to our portfolio companies and possibly consulting fees. 78 --------------------------------------------------------------------------------
Dividend income on equity investments is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded companies.
Our portfolio activity also reflects the proceeds from sales of investments. We recognize realized gains or losses on investments based on the difference between the net proceeds from the disposition and the amortized cost basis of the investment without regard to unrealized gains or losses previously recognized. We record current period changes in fair value of investments that are measured at fair value as a component of the net change in unrealized gains (losses) on investments in the consolidated statement of operations.
Expenses
Our primary operating expenses include the payment of the management fee and, since the expiration of the incentive fee waiver onOctober 18, 2020 , the incentive fee, expenses reimbursable under the Administration Agreement and Investment Advisory Agreement, legal and professional fees, interest and other debt expenses and other operating expenses. The management fee and incentive fee compensate our Adviser for work in identifying, evaluating, negotiating, closing, monitoring and realizing our investments. Except as specifically provided below, all investment professionals and staff of the Adviser, when and to the extent engaged in providing investment advisory and management services to us, the base compensation, bonus and benefits, and the routine overhead expenses of such personnel allocable to such services, are provided and paid for by the Adviser. We bear our allocable portion of the compensation paid by the Adviser (or its affiliates) to our Chief Compliance Officer and Chief Financial Officer and their respective staffs (based on a percentage of time such individuals devote, on an estimated basis, to our business affairs). We bear all other costs and expenses of our operations, administration and transactions, including, but not limited to (i) investment advisory fees, including management fees and incentive fees, to the Adviser, pursuant to the Investment Advisory Agreement; (ii) our allocable portion of overhead and other expenses incurred by the Adviser in performing its administrative obligations under the Administration Agreement; and (iii) all other costs and expenses of its operations and transactions including, without limitation, those relating to:
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the cost of our organization and offerings;
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the cost of calculating our net asset value, including the cost of any third-party valuation services;
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the cost of effecting any sales and repurchases of our common stock and other securities;
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fees and expenses payable under any dealer manager agreements, if any;
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debt service and other costs of borrowings or other financing arrangements;
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costs of hedging;
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expenses, including travel expense, incurred by the Adviser, or members of the investment team, or payable to third parties, performing due diligence on prospective portfolio companies and, if necessary, enforcing our rights;
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transfer agent and custodial fees;
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fees and expenses associated with marketing efforts;
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federal and state registration fees, any stock exchange listing fees and fees payable to rating agencies;
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federal, state and local taxes;
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independent directors' fees and expenses including certain travel expenses;
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costs of preparing financial statements and maintaining books and records and filing reports or other documents with theSEC (or other regulatory bodies) and other reporting and compliance costs, including registration and listing fees, and the compensation of professionals responsible for the preparation of the foregoing;
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the costs of any reports, proxy statements or other notices to our shareholders (including printing and mailing costs), the costs of any shareholder or director meetings and the compensation of investor relations personnel responsible for the preparation of the foregoing and related matters;
•
commissions and other compensation payable to brokers or dealers;
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research and market data;
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fidelity bond, directors' and officers' errors and omissions liability insurance and other insurance premiums;
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direct costs and expenses of administration, including printing, mailing, long distance telephone and staff;
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fees and expenses associated with independent audits, outside legal and consulting costs;
• costs of winding up;
•
costs incurred in connection with the formation or maintenance of entities or vehicles to hold our assets for tax or other purposes;
79
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extraordinary expenses (such as litigation or indemnification); and
•
costs associated with reporting and compliance obligations under the 1940 Act and applicable federal and state securities laws.
We expect, but cannot assure, that our general and administrative expenses will increase in dollar terms during periods of asset growth, but will decline as a percentage of total assets during such periods.
Leverage
The amount of leverage we use in any period depends on a variety of factors, including cash available for investing, the cost of financing and general economic and market conditions. Generally, our total borrowings are limited so that we cannot incur additional borrowings, including through the issuance of additional debt securities, if such additional indebtedness would cause our asset coverage ratio to fall below 200% or 150%, if certain requirements are met. This means that generally,$1 for every$1 of investor equity (or, if certain conditions are met, we can borrow up to$2 for every$1 of investor equity). In any period, our interest expense will depend largely on the extent of our borrowing, and we expect interest expense will increase as we increase our debt outstanding. In addition, we may dedicate assets to financing facilities. OnJune 8, 2020 , we received shareholder approval for the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the 1940 Act, as amended by the Small Business Credit Availability Act. As a result, effective onJune 9, 2020 , our asset coverage requirement applicable to senior securities was reduced from 200% to 150%. Our current target leverage ratio is 0.90x-1.25x.
Market Trends
We believe the middle-market lending environment provides opportunities for us to meet our goal of making investments that generate attractive risk-adjusted returns. Limited Availability of Capital for Middle-Market Companies. We believe that regulatory and structural changes in the market have reduced the amount of capital available toU.S. middle-market companies. In particular, we believe there are currently fewer providers of capital to middle market companies. 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. We also 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 its loans without having to syndicate them, coupled with reduced capacity of traditional lenders to serve the middle-market, present an attractive opportunity to invest in middle-market companies. Capital Markets Have Been Unable to Fill the Void inU.S. Middle Market Finance Left by Banks. While underwritten bond and syndicated loan markets have been robust in recent years, middle market companies are less able to access these markets for reasons including the following: High Yield Market - Middle market companies generally are not issuing debt in an amount large enough to be an attractively sized bond. High yield bonds are generally purchased by institutional investorswho , among other things, are focused on the liquidity characteristics of the bond being issued. For example, mutual funds and exchange traded funds ("ETFs") are significant buyers of underwritten bonds. However, mutual funds and ETFs generally require the ability to liquidate their investments quickly in order to fund investor redemptions and/or comply with regulatory requirements. Accordingly, the existence of an active secondary market for bonds is an important consideration in these entities' initial investment decision. Because there is typically little or no active secondary market for the debt ofU.S. middle market companies, mutual funds and ETFs generally do not provide debt capital toU.S. middle market companies. We believe this is likely to be a persistent problem and creates an advantage for those like uswho have a more stable capital base and have the ability to invest in illiquid assets. Syndicated Loan Market - While the syndicated loan market is modestly more accommodating to middle market issuers, as with bonds, loan issue size and liquidity are key drivers of institutional appetite and, correspondingly, underwriters' willingness to underwrite the loans. Loans arranged through a bank are done either on a "best efforts" basis or are underwritten with terms plus provisions that permit the underwriters to change certain terms, including pricing, structure, yield and tenor, otherwise known as "flex", to successfully syndicate the loan, in the event the terms initially marketed are insufficiently attractive to investors. Furthermore, banks are generally reluctant to underwrite middle market loans because the arrangement fees they may earn on the placement of the debt generally are not sufficient to meet the banks' return hurdles. Loans provided by companies such as ours provide certainty to issuers in that we can commit to a given amount of debt on specific terms, at stated coupons and with agreed upon fees. As we are the ultimate holder of the loans, we do not require market "flex" or other arrangements that banks may require when acting on an agency basis. Robust Demand forDebt Capital . We believeU.S. middle market companies will continue to require access to debt capital to refinance existing debt, support growth and finance acquisitions. In addition, we believe the large amount of uninvested capital held by funds of private equity firms, estimated byPreqin Ltd. , an alternative assets industry data and research company, to be$1.7 trillion as ofJanuary 2022 , will continue to drive deal activity. We expect that private equity sponsors will continue to pursue acquisitions and leverage their equity investments with secured loans provided by companies such as us. 80 -------------------------------------------------------------------------------- The Middle Market is a Large Addressable Market. According toGE Capital's National Center for the Middle Market 4th quarter 2021 Middle Market Indicator, there are approximately 200,000U.S. middle market companies, which have approximately 48 million aggregate employees. Moreover, theU.S. middle market accounts for one-third of private sector gross domestic product ("GDP").GE definesU.S. middle market companies as those between$10 million and$1 billion in annual revenue, which we believe has significant overlap with our definition ofU.S. middle market companies. Attractive Investment Dynamics. An imbalance between the supply of, and demand for, middle market debt capital creates attractive pricing dynamics. We believe the directly negotiated nature of middle market financings also generally provides more favorable terms to the lender, including stronger covenant and reporting packages, better call protection, and lender-protective change of control provisions. Additionally, we believe BDC managers' expertise in credit selection and ability to manage through credit cycles has generally resulted in BDCs experiencing lower loss rates thanU.S. commercial banks through credit cycles. Further, we believe that historical middle market default rates have been lower, and recovery rates have been higher, as compared to the larger market capitalization, broadly distributed market, leading to lower cumulative losses. Lastly, we believe that in the current environment, lenders with available capital may be able to take advantage of attractive investment opportunities as the economy reopens and may be able to achieve improved economic spreads and documentation terms. Conservative Capital Structures. Following the credit crisis, which we define broadly as occurring between mid-2007 and mid-2009, lenders have generally required borrowers to maintain more equity as a percentage of their total capitalization, specifically to protect lenders during economic downturns. With more conservative capital structures,U.S. middle market companies have exhibited higher levels of cash flows available to service their debt. In addition,U.S. middle market companies often are characterized by simpler capital structures than larger borrowers, which facilitates a streamlined underwriting process and, when necessary, restructuring process. Attractive Opportunities in Investments in Loans. We invest in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity and equity-related securities. We believe that opportunities in senior secured loans are significant because of the floating rate structure of most senior secured debt issuances and because of the strong defensive characteristics of these types of investments. Given the current low interest rate environment, we believe that debt issues with floating interest rates offer a superior return profile as compared with fixed-rate investments, since floating rate structures are generally less susceptible to declines in value experienced by fixed-rate securities in a rising interest rate environment. Senior secured debt also provides strong defensive characteristics. Senior secured debt has priority in payment among an issuer's security holders whereby holders are due to receive payment before junior creditors and equity holders. Further, these investments are secured by the issuer's assets, which may provide protection in the event of a default.
Portfolio and Investment Activity
As ofDecember 31, 2021 , based on fair value, our portfolio consisted of 74.9% first lien senior secured debt investments (of which 55% we consider to be unitranche debt investments (including "last out" portions of such loans)), 15.1% second lien senior secured debt investments, 1.5% unsecured investments, 2.1% preferred equity investments, 4.5% common equity investments and 1.9% investment funds and vehicles. As ofDecember 31, 2021 , our weighted average total yield of the portfolio at fair value and amortized cost was 7.7% and 7.8%, respectively, and our weighted average yield of accruing debt and income producing securities at fair value and amortized cost was 7.9% and 7.9%, respectively(1). As ofDecember 31, 2021 , the weighted average spread of total debt investments was 6.6%.
As of
Based on current market conditions, the pace of our investment activities, including originations and repayments, may vary. Currently, the strength of the financing and merger and acquisitions markets and the current low interest rate environment, has led to increased originations and repayments, an active pipeline of investment opportunities including demand for large unitranche debt investments. We are monitoring the effect that a rising interest rate environment may have on our portfolio companies and our investment activities. For the year endedDecember 31, 2021 , we received repayments of approximately$4.3 billion and we expect to continue to receive repayments in the current environment. ________________ (1)
Refer to page 84, footnote (1), for more information on our calculation of weighted average yields.
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Our investment activity for the years ended December 31, 2021 , 2020 and 2019 is
presented below (information presented herein is at par value unless otherwise
indicated).
For the Years Ended December 31,
($ in thousands) 2021 2020 2019
New investment commitments
Gross originations $ 7,456,901 3,667,048 4,625,939
Less: Sell downs (632,072 ) (222,276 ) (191,277 )
Total new investment commitments $ 6,824,829 $ 3,444,772 $ 4,434,662
Principal amount of investments
funded:
First-lien senior secured debt $ 4,369,794 $ 2,132,417
investments 3,083,777
Second-lien senior secured debt 846,299 518,480
596,421
investments
Unsecured debt investments 132,288 55,873
-
Preferred equity investments(3) 238,367 22,163 - Common equity investments(3) 113,780 97,617 1,991 Investment funds and vehicles 141,876 18,950 - Total principal amount of$ 5,842,404 $ 2,845,500 $ 3,682,189 investments funded Principal amount of investments sold or repaid: First-lien senior secured debt$ (3,343,381 ) $ (1,060,352 ) $ (820,602 ) investments Second-lien senior secured debt (910,582 ) (90,686 ) (116,700 ) investments Unsecured debt investments - - (23,000 ) Preferred equity investments(3) - - - Common equity investments(3) (4,827 ) (867 ) (1,991 ) Investment funds and vehicles - - (2,250 ) Total principal amount of$ (4,258,790 ) $ (1,151,905 ) $ (964,543 ) investments sold or repaid Number of new investment 67 30 38 commitments in new portfolio companies(1) Average new investment 82,831$ 84,891 $ 107,981 commitment amount Weighted average term for new 6.3 5.9 6.3 debt investment commitments (in years) Percentage of new debt 98.1 % 96.3 % 100.0 % investment commitments at floating rates Percentage of new debt 1.9 % 3.7 % 0.0 % investment commitments at fixed rates Weighted average interest rate 7.3 % 7.8 % 8.0 % of new debt investment commitments(2) Weighted average spread over 6.4 % 6.9 % 6.1 % LIBOR of new floating rate debt investment commitments ________________ (1) Number of new investment commitments represents commitments to a particular portfolio company. (2) Assumes each floating rate commitment is subject to the greater of the interest rate floor (if applicable) or 3-month LIBOR, which was 0.21%, 0.24% and 1.91% as ofDecember 31, 2021 , 2020 and 2019, respectively. (3) As ofDecember 30, 2020 and 2019, preferred equity investments and common equity investments were reported in aggregate as equity investments. As ofDecember 31, 2021 and 2020, our investments consisted of the following: December 31, 2021 December 31, 2020 ($ in thousands) Amortized Cost Fair Value Amortized Cost Fair Value First-lien senior secured$ 9,548,096 (3)$ 9,539,774 $ 8,483,799 (3)$ 8,404,754 debt investments Second-lien senior secured 1,919,453 1,921,447 2,035,151 2,000,471 debt investments Unsecured debt investments 197,198 196,485 56,473 59,562 Preferred equity 256,630 260,869 22,163 22,157 investments(4) Common equity 477,462 576,004 223,295 249,582 investments(1)(4) Investment funds and 249,714 247,061 107,837 105,546 vehicles(2) Total Investments$ 12,648,553 $ 12,741,640 $
10,928,718
________________
(1)
Includes investment in Wingspire.
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Includes investment in ORCC SLF. (3) 55% and 37% of which we consider unitranche loans as ofDecember 31, 2021 andDecember 31, 2020 , respectively. (4) As ofDecember 31, 2020 , preferred equity investments and common equity investments were reported in aggregate as equity investments.
The table below describes investments by industry composition based on fair
value as of
December 31, 2021 December 31, 2020
Advertising and media 0.9 % 1.0 %
Aerospace and defense 2.9 2.7
Automotive 1.5 1.6
Buildings and real estate 5.4 5.6
Business services 3.3 5.7
Chemicals 2.3 2.2
Consumer products 4.0 2.3
Containers and packaging 1.3 2.0
Distribution 4.4 6.3
Education 1.0 2.6
Energy equipment and services - 0.1
Financial services(1) 8.4 2.9
Food and beverage 6.2 8.7
Healthcare equipment and services 4.2 3.7
Healthcare providers and services 7.1 5.2
Healthcare technology 4.6 3.6
Household products 1.8 1.4
Human resource support services(3) 1.6 0.0
Infrastructure and environmental services 1.5 1.8
Insurance 8.8 8.9
Internet software and services 11.3 11.1
Investment funds and vehicles(2) 1.9 1.0
Leisure and entertainment 2.2 2.0
Manufacturing 5.7 5.3
Oil and gas 0.9 1.7
Professional services 3.0 5.6
Specialty retail 2.0 2.1
Telecommunications - 0.5
Transportation 1.8 2.4
Total 100.0 % 100.0 %
________________
(1)
Includes investment in Wingspire.
(2)
Includes investment in ORCC SLF.
(3)
Rounds to less than 0.1% as of December 31, 2020 .
The table below describes investments by geographic composition based on fair
value as of
December 31, 2021 December 31, 2020
United States :
Midwest 17.0 % 18.2 %
Northeast 19.7 16.7
South 38.2 42.3
West 18.6 17.2
International 6.5 5.6 (1)
Total 100.0 % 100.0 %
________________
(1)
As of
The weighted average yields and interest rates of our investments at fair value
as of
83
--------------------------------------------------------------------------------
December 31, 2021 December 31, 2020
Weighted average total yield of 7.7 % 7.9 %
portfolio(1)
Weighted average total yield of accruing 7.9 % 8.1 %
debt and income
producing securities(1) Weighted average interest rate of 7.4 % 7.4 % accruing debt securities Weighted average spread over LIBOR of 6.5 % 6.6 % all accruing floating rate investments ________________ (1) For non-stated rate income producing investments, computed based on (a) the dividend or interest income earned for the respective trailing twelve months ended on the measurement date, divided by (b) the ending fair value. In instances where historical dividend or interest income data is not available or not representative for the trailing twelve months ended, the dividend or interest income is annualized. Prior toSeptember 30, 2021 , non-stated rate income producing investments were computed based on (a) the IRR on the measurement date, divided by (b) the ending fair value. Prior toSeptember 30, 2021 , weighted average total yield of the portfolio at fair value was 8.1% for the period endedDecember 31, 2020 . Prior toSeptember 30, 2021 , weighted average total yield of accruing debt and income producing securities at fair value was 8.3% for the period endedDecember 31, 2020 . The weighted average yield of our accruing debt and income producing securities is not the same as a return on investment for our shareholders but, rather, relates to our investment portfolio and is calculated before the payment of all of our and our subsidiaries' fees and expenses. The weighted average yield was computed using the effective interest rates as of each respective date, including accretion of original issue discount and loan origination fees, but excluding investments on non-accrual status, if any. There can be no assurance that the weighted average yield will remain at its current level. Our Adviser monitors our portfolio companies on an ongoing basis. It monitors the financial trends of each portfolio company to determine if they are meeting their respective business plans and to assess the appropriate course of action with respect to each portfolio company. Our Adviser has several methods of evaluating and monitoring the performance and fair value of our investments, which may include the following:
•
assessment of success of the portfolio company in adhering to its business plan and compliance with covenants;
•
periodic and regular contact with portfolio company management and, if appropriate, the financial or strategic sponsor, to discuss financial position, requirements and accomplishments;
•
comparisons to other companies in the portfolio company's industry; and
•
review of monthly or quarterly financial statements and financial projections for portfolio companies.
As part of the monitoring process, our Adviser employs an investment rating
system to categorize our investments. In addition to various risk management and
monitoring tools, our Adviser rates the credit risk of all investments on a
scale of 1 to 5. 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
84
--------------------------------------------------------------------------------
investment (i.e., at the time of origination or acquisition), although it may
also take into account the performance of the portfolio company's business, the
collateral coverage of the investment and other relevant factors. The rating
system is as follows:
Investment Rating Description
1 Investments rated 1 involve the least amount of risk to our
initial cost basis. The borrower is performing above
expectations, and the trends and risk factors for this
investment since origination or acquisition are generally
favorable;
2 Investments rated 2 involve an acceptable level of risk that is
similar to the risk at the time of origination or acquisition.
The borrower is generally performing as expected and the risk
factors are neutral to favorable. All investments or acquired
investments in new portfolio companies are initially assessed a
rating of 2;
3 Investments rated 3 involve a borrower performing below
expectations and indicates that the loan's risk has increased
somewhat since origination or acquisition;
4 Investments rated 4 involve a borrower performing materially
below expectations and indicates that the loan's risk has
increased materially since origination or acquisition. In
addition to the borrower being generally out of compliance with
debt covenants, loan payments may be past due (but generally not
more than 120 days past due); and
5 Investments rated 5 involve a borrower performing substantially
below expectations and indicates that the loan's risk has
increased substantially since origination or acquisition. Most
or all of the debt covenants are out of compliance and payments
are substantially delinquent. Loans rated 5 are not anticipated
to be repaid in full and we will reduce the fair market value of
the loan to the amount we anticipate will be recovered.
Our Adviser rates the investments in our portfolio at least quarterly and it is
possible that the rating of a portfolio investment may be reduced or increased
over time. For investments rated 3, 4 or 5, our Adviser enhances its level of
scrutiny over the monitoring of such portfolio company.
The following table shows the composition of our portfolio on the 1 to 5 rating
scale as of
December 31, 2021 December 31, 2020 Investments Percentage of
Investments Percentage of
Investment Rating at Fair Value Total Portfolio at Fair Value Total Portfolio
($ in thousands)
1 $ 1,486,521 11.7 % $ 1,093,318 10.1 %
2 9,989,520 78.4 8,628,248 79.6
3 1,249,149 9.8 904,018 8.3
4 16,450 0.1 216,488 2.0
5 - - - -
Total $ 12,741,640 100.0 % $ 10,842,072 100.0 %
The following table shows the amortized cost of our performing and non-accrual
debt investments as of
December 31, 2021 December 31, 2020
($ in thousands) Amortized Cost Percentage Amortized Cost Percentage
Performing $ 11,637,373 99.8 % $ 10,518,059 99.5 %
Non-accrual 27,374 0.2 % 57,364 0.5 %
Total $ 11,664,747 100.0 % $ 10,575,423 100.0 %
85
--------------------------------------------------------------------------------
Loans are generally placed on non-accrual status when there is reasonable doubt
that principal or interest will be collected in full. Accrued 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 current and, in management's judgment, are likely to remain
current. Management may make exceptions to this treatment and determine to not
place a loan on non-accrual status if the loan has sufficient collateral value
and is in the process of collection.
86
--------------------------------------------------------------------------------Portfolio Companies
The following table sets forth certain information regarding each of the portfolio companies in which we had a debt or equity investment as ofDecember 31, 2021 . We offer to make available significant managerial assistance to our portfolio companies. We may receive rights to observe the meetings of our portfolio companies' board of directors. Other than these investments, our only relationships with our portfolio companies are the managerial assistance we may separately provide to our portfolio companies, which services would be ancillary to our investments. As ofDecember 31, 2021 , other than ORCC SLF,Wingspire Capital Holdings LLC ,Swipe Acquisition Corp. (dba PLI) andPS Operating Company LLC (fkaQC Supply, LLC ), we did not "control" and are not an "affiliate" of any of our portfolio companies, each as defined in the 1940 Act. In general, under the 1940 Act, we would "control" a portfolio company if we owned 25.0% or more of its voting securities and would be an "affiliate" of a portfolio company if we owned five percent or more of its voting securities. Percentage of Class Principal Held on a Number of Maturity / Fully Shares / ($ in thousands) Type of Interest
Dissolution Diluted Number of
Industry Investment Rate Date Basis Units Cost Fair Value
0.0 % 61,259 60,718 60,340
(dba Aucerna)(1)(4) software and senior 6.75%
Suite 800, 250 - 2nd services secured loan
Street S.W.
Calgary, Alberta,
Canada
3ES Innovation Inc. Internet First lien L + 5/13/2025 0.0 % - (27 ) (58 )
(dba Aucerna)(1)(12) software and senior 6.75%
Suite 800, 250 - 2nd services secured
Street S.W. revolving
Calgary, Alberta, loan
Canada
ABB/Con-cise Optical Distribution First lien L + 6/15/2023 0.0 % 74,831 74,484 74,456
Group LLC(1)(2) senior 5.00%
12301 NW 39th secured loan
StreetCoral Springs , FL
33065
ABB/Con-cise Optical Distribution Second lien L + 6/17/2024 0.0 % 25,000 24,705 24,875
Group LLC(1)(2) senior 9.00%
12301 NW 39th secured loan
StreetCoral Springs , FL
33065
Accela, Inc.(1)(2) Internet First lien L + 9/30/2024 0.0 % 23,990 23,818 23,990
2633 Camino Ramon, software and senior 7.50%
Suite 500San Ramon, CA services secured loan (incl.
94583 4.25%
PIK)
Accela, Inc.(1)(12) Internet First lien L + 9/30/2024 0.0 % - - -
2633 Camino Ramon, software and senior 7.00%
Suite 500San Ramon, CA services secured
94583 revolving
loan
0.0 % 58,760 58,343 58,466
6818 A
secured loan
Alera Group, Inc.(1)(2) Insurance First lien L + 10/2/2028 0.0 % 43,036 42,097 42,068
3 Parkway North, Suite senior 5.50%
500. Deerfield, secured loan
Illinois 60015
Alera Group, Insurance First lien L + 10/2/2023 0.0 % 11,825 11,560 11,554
Inc.(1)(2)(12) senior 5.50%
3 Parkway North, Suite secured
500. Deerfield, delayed draw
Illinois 60015 term loan
AmSpec Group, Inc. (fka Professional First lien L + 7/2/2024 0.0 % 110,265 109,296 109,713
AmSpec Services services senior 5.75%
Inc.)(1)(4) secured loan
1249 S River
RdCranbury, NJ 08512
AmSpec Group, Inc. (fka Professional First lien P + 7/2/2024 0.0 % 3,796 3,691 3,724
AmSpec Services services senior 3.75%
Inc.)(1)(7)(12) secured
1249 S River revolving
RdCranbury, NJ 08512 loan
87--------------------------------------------------------------------------------
Apex Group Treasury, Professional Second lien L + 6.75%
0.0 % 19,000 18,817 18,810
LLC(1)(4) Services senior
Vallis Building, 4th secured
Floor, 58 loan
Par-le-Ville Rd ,
Hamilton HM11 Bermuda
Apex Group Treasury, Professional Second lien L + 6.75% 6/30/2022 0.0 % - - -
LLC(1)(12) Services senior
Vallis Building, 4th secured
Floor, 58 delayed
Par-le-Ville Rd, draw term
Hamilton HM11 Bermuda loan
Apptio, Inc.(1)(5) Internet First lien L + 7.25% 1/10/2025 0.0 % 50,916 50,179 50,916
11100 NE 8th Street, software and senior
Suite 600, Bellevue, services secured
WA 98004 loan
Apptio, Internet First lien L + 7.25% 1/10/2025 0.0 % 1,112 1,084 1,112
Inc.(1)(4)(12) software and senior
11100 NE 8th Street, services secured
Suite 600, Bellevue, revolving
WA 98004 loan
Aramsco, Inc.(1)(2) Distribution First lien L + 5.25% 8/28/2024 0.0 % 55,899 55,224 55,899
PO Box 29Thorofare, senior
NJ 08086 secured
loan
Aramsco, Inc.(1)(12) Distribution First lien L + 5.25% 8/28/2024 0.0 % - (93 ) -
PO Box 29Thorofare, senior
NJ 08086 secured
revolving
loan
Ardonagh Midco 3 Insurance First lien L + 5.50% 7/14/2026 0.0 % 26,784 26,269 26,784
PLC(1)(5) senior
1 Minster Court, secured USD
Mincing Lane, London delayed
EC3R 7AA, United draw term
Kingdom loan
Ardonagh Midco 3 Insurance First lien E + 6.75% 7/14/2026 0.0 % 10,388 10,013 10,388
PLC(1)(10) senior
1 Minster Court, secured
Mincing Lane, London loan
EC3R 7AA, United
Kingdom
Ardonagh Midco 3 Insurance First lien S + 6.75% 7/14/2026 0.0 % 117,374 106,703 117,374
PLC(1)(11) senior
1 Minster Court, secured GBP
Mincing Lane, London term loan
EC3R 7AA, United
Kingdom
Ardonagh Midco 3 Insurance First lien L + 5.50% 8/19/2023 0.0 % - - -
PLC(1)(12) senior
1 Minster Court, secured GBP
Mincing Lane, London delayed
EC3R 7AA, United draw term
Kingdom loan
Ardonagh Midco 2 PLC Insurance Unsecured 12.75% PIK 1/15/2027
0.0 % 10,527 10,451 11,620
1 Minster Court, notes
Mincing Lane , London
EC3R 7AA, United
Kingdom
Aruba Investments Chemicals Second lien L + 7.75% 11/24/2028 0.0 % 10,000 9,867 10,000
Holdings LLC (dba senior
Angus Chemical secured
Company)(1)(5) loan
1500 E Lake Cook Rd ,
Buffalo Grove, IL
60089
Ascend Buyer, LLC Containers First lien L + 5.75% 10/2/2028 0.0 % 5,554 5,500 5,498
(dba PPC Flexible and senior
Packaging)(1)(4) packaging secured
1111 Busch Parkway, loan
Buffalo Grove, IL
60089
Ascend Buyer, LLC Containers First lien L + 5.75% 9/30/2027 0.0 % 94 89 88
(dba PPC Flexible and senior
Packaging)(1)(4)(12) packaging secured
1111 Busch Parkway, revolving
Buffalo Grove, IL loan
60089
88-------------------------------------------------------------------------------- Associations, Buildings First lien L + 7/2/2027 0.0 % 452,630 448,461 448,102 Inc.(1)(4) and real senior 6.50% 5401 North Central estate secured loan (incl. Expressway, Suite 2.50% 300Dallas, TX 75205 PIK) Associations, Buildings First lien L + 7/2/2027 0.0 % - (302 ) (329 ) Inc.(1)(12) and real senior 6.50% 5401 North Central estate secured Expressway, Suite revolving 300Dallas, TX 75205 loan Aviation Solutions Aerospace First lien L + 1/3/2025 0.0 % 214,643 212,314 202,838 Midco, LLC (dba STS and defense senior 7.25% Aviation)(1)(4) secured loan 2000NE Jensen Beach BlvdJensen Beach, FL 34957 AxiomSL Group, Financial First lien L + 12/3/2027 0.0 % 202,775 200,614 201,254 Inc.(1)(4) services senior 6.00% 45 Broadway, 27th secured loan Floor,New York, NY , 10006 AxiomSL Group, Financial First lien L + 7/21/2023 0.0 % - (39 ) - Inc.(1)(12) services senior 6.00% 45 Broadway, 27th secured Floor, New York, NY, delayed draw 10006 term loan AxiomSL Group, Financial First lien L + 12/3/2025 0.0 % - (190 ) (137 ) Inc.(1)(12) services senior 6.00% 45 Broadway, 27th secured Floor, New York, NY, revolving 10006 loan Balrog Acquisition, Food and Second lien L + 9/3/2029 0.0 % 22,000 21,821 21,815 Inc. (dba beverage senior 7.00% BakeMark)(1)(5) secured loan7351 Crider Ave. , Pico Rivera, CA 90660 Bayshore Intermediate Internet First lien L + 10/2/2028
0.0 % 82,962 81,145 81,095 #2, L.P. (dba
software senior 7.75%
Boomi)(1)(4) and secured loan PIK
1400 Liberty Ridge services
Drive, Chesterbrook PA ,
19087
Bayshore Intermediate Internet First lien L + 10/1/2027 0.0 % - (149 ) (156 )
#2, L.P. (dba software senior 6.75%
Boomi)(1)(12) and secured
1400 Liberty Ridge services revolving
Drive, Chesterbrook PA, loan
19087
Brooklyn Lender Internet Common Units N/A N/A 0.2 % 7,503,843 7,504 7,504 Co-Invest 2, L.P. software 1400 Liberty Ridge and Drive, Chesterbrook PA, services 19087 BCPE Nucleon (DE) SPV, Internet First lien L + 9/24/2026 0.0 % 189,778 187,355 188,829 LP(1)(5) software senior 7.00% 4001 Kennett Pike, and secured loan Suite 302, Wilmington, services DE 19807 BCPE Osprey Buyer, Inc. Healthcare First lien L + 8/23/2028
0.0 % 114,052 112,307 112,227
(dba
secured loan
Ohio 44202
BCPE Osprey Buyer, Inc. Healthcare First lien L + 8/23/2023 0.0 % - (269 ) (133 )
(dba technology senior 5.75%
PartsSource)(1)(12) secured
777 Lena Drive Aurora, delayed draw
Ohio 44202 term loan
0.0 % - (190 ) (190 ) (dba technology senior 5.75% PartsSource)(1)(12) secured 777 Lena Drive Aurora, revolving Ohio 44202 loan
0.0 % 44,643 44,258 44,420
(dba software senior 7.00%
Buildertrend)(1)(4) and secured loan
11811 I St. Omaha, NE services
68137
BCTO BSI Buyer, Inc. Internet First lien L + 12/23/2026 0.0 % 3,018 2,973 2,991
(dba software senior 7.00%
Buildertrend)(1)(4)(12) and secured
11811 I St. Omaha, NE services revolving
68137 loan
89--------------------------------------------------------------------------------
Black Mountain Sand Oil and First lien L + 8.25% 8/17/2022 0.0 % 4,808 4,808 4,808 Eagle Ford LLC(1)(4) gas senior 420 Commerce Street, secured Suite 500, Fort loan Worth, TX 76102 Blackhawk Network Financial Second L + 7.00% 6/15/2026 0.0 % 106,400 105,763 106,400 Holdings, Inc.(1)(2) services lien 6220 Stoneridge Mall senior RoadPleasanton, CA secured 94588 loan Blend Labs, Financial First lien L + 7.50% 7/1/2026 0.0 % 67,500 65,988 66,150 Inc.(1)(4) services senior 415 Kearny Street secured San Francisco, CA loan 94108 Blend Labs, Financial First lien L + 7.50% 7/1/2026 0.0 % - (67 ) (150 ) Inc.(1)(12) services senior 415 Kearny Street secured San Francisco, CA revolving 94108 loan Blend Labs, Inc. Financial Common N/A N/A 0.0 % 72,317 1,000 515 415 Kearny Street services Stock San Francisco, CA 94108 Blend Labs, Inc. Financial Warrants N/A N/A 0.0 % 179,529 975 380 415 Kearny Street services San Francisco, CA 94108BP Veraison Buyer , Food and First lien L + 5.75% 5/12/2027 0.0 % 69,381 68,596 68,687 LLC (dba Sun beverage senior World)(1)(3) secured 5701 Truxtun Ave loan Bakersfield, CA 93309BP Veraison Buyer , Food and First lien L + 5.75% 5/12/2023 0.0 % - (32 ) - LLC (dba Sun beverage senior World)(1)(12) secured 5701 Truxtun Ave delayed Bakersfield, CA draw term 93309 loanBP Veraison Buyer , Food and First lien L + 5.75% 5/12/2027 0.0 % - (97 ) (87 ) LLC (dba Sun beverage senior World)(1)(12) secured 5701 Truxtun Ave revolving Bakersfield, CA loan 93309 Bracket Intermediate Healthcare First lien L + 4.25% 9/5/2025 0.0 % 516 487 514 Holding Corp.(1)(4) technology senior 575 East Swedesford secured Road, Suite loan 200Wayne, PA 19087 Bracket Intermediate Healthcare Second L + 8.13% 9/7/2026 0.0 % 26,250 25,896 26,119 Holding Corp.(1)(4) technology lien 575 East Swedesford senior Road, Suite secured 200Wayne, PA 19087 loan Brightway Holdings, Insurance First lien L + 6.50% 12/16/2027 0.0 % 26,842 26,509 26,507 LLC(1)(4) senior 3733 University secured Blvd. W loan Jacksonville, FL 32217 Brightway Holdings, Insurance First lien L + 6.50% 12/16/2027 0.0 % - (39 ) (39 ) LLC(1)(12) senior 3733 University secured Blvd. W revolving Jacksonville, FL loan 32217 GrowthCurve Capital Insurance LP N/A N/A 1.6 % 632 633 632 Sunrise Co-Invest LP Interest 3733 University Blvd. W Jacksonville, FL 32217 CD&R Value Building Automotive LP N/A N/A 0.8 % 33,000 33,065 33,000 Partners I, L.P. Interest c/o Maples Corporate Services Limited, P.O. Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands 90
--------------------------------------------------------------------------------
Centrify Internet First lien L + 3/2/2028 0.0 % 66,903 65,383 65,564
Corporation(1)(4) software senior 5.75%
3300 Tannery Way, and secured
Santa Clara, CA 95054 services loan
Centrify Internet First lien L + 3/2/2027 0.0 % - (173 ) (136 )
Corporation(1)(12) software senior 5.75%
3300 Tannery Way, and secured
Santa Clara, CA 95054 services revolving
loan
CIBT Global, Business First lien L + 6/3/2024 0.0 % 856 629 531
Inc.(1)(4) services senior 5.25%
1600 International secured (incl.
Drive, Suite loan 4.25%
600McLean, VA 22102 PIK)
CIBT Global, Business Second lien L + 12/1/2025 0.0 % 63,678 26,745 15,919
Inc.(1)(6) services senior 7.75%
1600 International secured (incl.
Drive, Suite loan 6.75%
600McLean, VA 22102 PIK)
CivicPlus, LLC(1)(4) Internet First lien L + 8/24/2027 0.0 % 14,236 14,101 14,094
302 South 4th Street software senior 6.00%
Suite 500 Manhattan, and secured
KS 66502 services loan
CivicPlus, LLC(1)(12) Internet First lien L + 8/24/2023 0.0 % - - -
302 South 4th Street software senior 6.00%
Suite 500 Manhattan, and secured
KS 66502 services delayed
draw term
loan
CivicPlus, LLC(1)(12) Internet First lien L + 8/24/2027 0.0 % - (13 ) (13 )
302 South 4th Street software senior 6.00%
Suite 500 Manhattan, and secured
KS 66502 services revolving
loan
ConAir Holdings Consumer Second lien L + 5/17/2029 0.0 % 187,500 186,174 187,500
LLC(1)(4) products senior 7.50%
1 Cummings Point Road secured
Stamford, CT, 06902 loan
ASP Conair Holdings Consumer Class A N/A N/A 0.8 % 60,714 6,071 6,071
LP products Units
1 Cummings Point Road
Stamford, CT, 06902
Cornerstone OnDemand, Human Second lien L + 10/15/2029 0.0 % 115,833 114,128 114,096
Inc.(1)(5) resource senior 6.50%
1601 Cloverfield Blvd support secured
Ste 600S, Santa services loan
Monica, CA 90404
Sunshine Software Human Series A 10.50% N/A 1.5 % 38,500 38,401 38,380
Holdings, Inc. (dba resource Preferred PIK
Cornerstone OnDemand, support Stock
Inc.) services
1601 Cloverfield Blvd
Ste 600S, Santa
Monica, CA 90404
Delta TopCo , Inc. Internet Second lien L + 12/1/2028 0.0 % 15,000 14,934 15,000
(dba Infoblox, software senior 7.25%
Inc.)(1)(4) and secured
3111 Coronado Dr, services loan
Santa Clara, CA 95054
Denali BuyerCo, LLC Business First lien L + 9/15/2028 0.0 % 51,393 50,665 50,879
(dba Summit services senior 6.00%
Companies)(1)(4) secured
575 Minnehaha Ave. W. loan
St. Paul, MN 55103
Denali BuyerCo, LLC Business First lien L + 9/15/2023 0.0 % 2,003 1,927 1,983
(dba Summit services senior 6.00%
Companies)(1)(4)(12) secured
575 Minnehaha Ave. W. delayed
St. Paul, MN 55103 draw term
loan
Denali BuyerCo, LLC Business First lien L + 9/15/2027 0.0 % - (34 ) (36 )
(dba Summit services senior 6.00%
Companies)(1)(12) secured
575 Minnehaha Ave. W. revolving
St. Paul, MN 55103 loan
91--------------------------------------------------------------------------------
0.4 % 313,850 3,136 3,136
(dba Summit services Units
Companies)
575 Minnehaha Ave. W.
St. Paul, MN 55103
Diamondback Business First lien L + 9/13/2028 0.0 % 5,407 5,302 5,298
Acquisition, Inc. services senior 5.50%
(dba Sphera)(1)(2) secured
130 East Randolph loan
Street Suite 1900
Chicago, IL 60601
Diamondback Business First lien L + 9/13/2023 0.0 % - (10 ) (11 )
Acquisition, Inc. services senior 5.50%
(dba Sphera)(1)(12) secured
130 East Randolph delayed
Street Suite 1900 draw term
Chicago, IL 60601 loan
Dodge Data & Buildings First lien L + 4/14/2026 0.0 % 32,561 31,987 33,538
Analytics LLC(1)(4) and real senior 7.50%
300 American Metro estate secured
Blvd. Suite 185 loan
Hamilton, NJ 08619
Dodge Data & Buildings First lien L + 4/14/2026 0.0 % - (32 ) -
Analytics LLC(1)(12) and real senior 7.50%
300 American Metro estate secured
Blvd. Suite 185 revolving
Hamilton, NJ 08619 loan
Skyline Holdco B, Buildings Series A N/A N/A 0.7 % 2,181,629 3,272 3,612
Inc. (dba Dodge Data and real Preferred
& Analytics) estate Stock
300 American Metro
Blvd. Suite 185
Hamilton, NJ 08619
Douglas Products and Chemicals First lien L + 10/19/2022 0.0 % 106,179 105,952 105,117
Packaging Company senior 5.75%
LLC(1)(4) secured
1550 E. Old 210 loan
HighwayLiberty, MO
64068
Douglas Products and Chemicals First lien P + 10/19/2022 0.0 % 5,147 5,135 5,056
Packaging Company senior 4.75%
LLC(1)(7)(12) secured
1550 E. Old 210 revolving
HighwayLiberty, MO loan
64068
EET Buyer, Inc. (dba Internet First lien L + 11/8/2027 0.0 % 4,545 4,501 4,500
e-Emphasys)(1)(4) software and senior 5.75%
2501 Weston Pkwy # services secured
101, Cary, NC 27513 loan
EET Buyer, Inc. (dba Internet First lien L + 11/8/2027 0.0 % - (4 ) (5 )
e-Emphasys)(1)(12) software and senior 5.75%
2501 Weston Pkwy # services secured
101, Cary, NC 27513 revolving
loan
Endries Acquisition, Distribution First lien L + 12/10/2025 0.0 % 200,163 197,994 200,163
Inc.(1)(4) senior 6.25%
714 West Ryan Street, secured
P.O. Box 69 Brillion, loan
Wisconsin USA
54110-0069
Entertainment Business First lien L + 9/30/2025
0.0 % 83,600 82,795 79,838
secured (incl.
19495 Biscayne loan 2.50%
Boulevard, Suite 300, PIK)
Aventura, FL 33180
Entertainment Business First lien L + 9/30/2024 0.0 % - (91 ) (504 )
Benefits Group, services senior 8.25%
LLC(1)(12) secured (incl.
19495 Biscayne revolving 2.50%
Boulevard, Suite 300, loan PIK)
Aventura, FL 33180
Evolution BuyerCo, Insurance First lien L + 4/28/2028 0.0 % 143,150 141,253 141,360
Inc. (dba SIAA)(1)(4) senior 6.25%
234 Lafayette Rd secured
Hampton?, NH, loan
03842-4105 United
States
92--------------------------------------------------------------------------------
Evolution BuyerCo, Insurance First lien L + 4/30/2027 0.0 % - (135 ) (134 ) Inc. (dba senior 6.25% SIAA)(1)(12) secured 234 Lafayette Rd revolving Hampton?, NH, loan 03842-4105 United States Evolution Parent, LP Insurance LP Interest N/A N/A 0.9 % 42,838 4,284 4,284 (dba SIAA) 234 Lafayette Rd Hampton?, NH, 03842-4105 United States Feradyne Outdoors, Consumer First lien L + 5/25/2023 0.0 % 86,956 86,671 86,956 LLC(1)(4) products senior 6.25% 1230 Poplar secured AvenueSuperior, WI loan 54880 Forescout Internet First lien L + 8/17/2026 0.0 % 54,811 54,119 54,811 Technologies, software and senior 9.50% Inc.(1)(4) services secured PIK 190 W. Tasman Drive, loan San Jose, CA 95134 Forescout Internet First lien L + 8/18/2025 0.0 % - (68 ) - Technologies, software and senior 8.50% Inc.(1)(12) services secured 190 W. Tasman Drive, revolving San Jose, CA 95134 loan Fortis Solutions Containers and First lien L + 10/13/2028 0.0 % 3,324 3,259 3,257 Group, LLC(1)(4) packaging senior 5.50% 2505 Hawkeye Ct secured Virginia Beach, VA, loan 23452-7845 United States Fortis Solutions Containers and First lien L + 10/13/2023 0.0 % - (13 ) (13 ) Group, LLC(1)(12) packaging senior 5.50% 2505 Hawkeye Ct secured Virginia Beach, VA, delayed 23452-7845 United draw term States loan Fortis Solutions Containers and First lien L + 10/15/2027 0.0 % - (9 ) (9 ) Group, LLC(1)(12) packaging senior 5.50% 2505 Hawkeye Ct secured Virginia Beach, VA, revolving 23452-7845 United loan States FR Arsenal Holdings Infrastructure First lien L + 9/8/2022 0.0 % 118,253 118,545 112,932 II Corp. (dba and senior 7.50% Applied-Cleveland environmental secured Holdings, Inc.)(1)(5) services loan 370690 East Old Highway 64Cleveland, OK 74020 Gainsight, Inc.(1)(4) Business First lien L + 7/30/2027
0.0 % 19,547 19,231 19,254
secured PIK
CA loan
Gainsight, Business First lien L + 7/30/2027 0.0 % - (55 ) (50 )
Inc.(1)(12) services senior 6.00%
655 Montgomery St 7th secured
Floor, San Francisco, revolving
CA loan
0.0 % 104,742 103,983 98,458 1340 Russell Cave Retail senior 6.75% RoadP.O. Box secured (incl. 54308Lexington, KY loan 0.50% 40505 PIK) Galls, LLC(1)(4)(12) Specialty First lien L + 1/31/2024 0.0 % 11,943 11,624 9,999 1340 Russell Cave Retail senior 6.75% RoadP.O. Box secured 54308Lexington, KY revolving 40505 loan Gaylord Chemical Chemicals First lien L + 3/30/2027
0.0 % 152,645 151,277 151,882
Company, L.L.C.(1)(4) senior 6.50%
106 Galeria Blvd secured
Dlidell, LA, loan
70458-1245
93--------------------------------------------------------------------------------
Gaylord Chemical Chemicals First lien L + 6.50% 3/30/2026 0.0 % - (112 ) (66 ) Company, senior L.L.C.(1)(12) secured 106 Galeria Blvd revolving Dlidell, LA, loan 70458-1245 Genesis Acquisition Internet First lien L + 4.00% 7/31/2024 0.0 % 18,129 17,961 17,630 Co. (dba Procare software and senior Software)(1)(4) services secured 1 West Main St., Ste loan 201Medford, OR 97501 Genesis Acquisition Internet First lien L + 4.00% 7/31/2024 0.0 % 2,637 2,614 2,564 Co. (dba Procare software and senior Software)(1)(4) services secured 1 West Main St., Ste revolving 201Medford, OR 97501 loan Gerson Lehrman Professional First lien L + 5.25% 12/12/2024 0.0 % 151,895 151,062 151,895 Group, Inc.(1)(5) services senior 60 East 42nd Street, secured 3rd Floor, New York, loan NY 10165 Gerson Lehrman Professional First lien L + 5.25% 12/12/2024 0.0 % - (105 ) - Group, Inc.(1)(12) services senior 60 East 42nd Street, secured 3rd Floor, New York, revolving NY 10165 loan GI Ranger Healthcare First lien L + 6.00% 10/30/2028 0.0 % 4,017 3,938 3,937 Intermediate, LLC technology senior (dba Rectangle secured Health)(1)(4) loan 115 E Stevens Ave, Valhalla, New York, 10595, United States GI Ranger Healthcare First lien L + 6.00% 10/30/2023 0.0 % - (6 ) (6 ) Intermediate, LLC technology senior (dba Rectangle secured Health)(1)(12) delayed 115 E Stevens Ave, draw term Valhalla, New York, loan 10595,United States GI Ranger Healthcare First lien L + 6.00% 10/29/2027 0.0 % - (7 ) (7 ) Intermediate, LLC technology senior (dba Rectangle secured Health)(1)(12) revolving 115 E Stevens Ave, loan Valhalla, New York, 10595, United States Global Music Rights, Advertising First lien L + 5.75% 8/28/2028 0.0 % 7,500 7,356 7,350 LLC(1)(4) and media senior 907 Westwood Blvd secured #388 · Los Angeles, loan CA 90024 Global Music Rights, Advertising First lien L + 5.75% 8/27/2027 0.0 % - (13 ) (13 ) LLC(1)(12) and media senior 907 Westwood Blvd secured #388 · Los Angeles, revolving CA 90024 loan Gloves Buyer, Inc. Manufacturing Second lien L + 8.25% 12/29/2028 0.0 % 29,250 28,584 28,884 (dba Protective senior Industrial secured Products)(1)(2) loan 968 Albany Shaker Road Latham, NY 12110 Gloves Holdings, LP Manufacturing LP Interest N/A N/A 0.6 % 3,250 3,250 3,640 (dba Protective Industrial Products) 968 Albany Shaker Road Latham, NY 12110 GovBrands Internet First lien L + 5.50% 8/4/2027 0.0 % 10,658 10,407 10,392 Intermediate, software and senior Inc.(1)(4) services secured 3025 Windward Plaza, loan Ste 200. Alpharetta, GA GovBrands Internet First lien L + 5.50% 8/4/2023 0.0 % 2,404 2,333 2,330 Intermediate, software and senior Inc.(1)(2)(12) services secured 3025 Windward Plaza, delayed Ste 200. Alpharetta, draw term GA loan 94
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GovBrands Internet First lien L + 8/4/2027 0.0 % - (18 ) (20 )
Intermediate, software and senior 5.50%
Inc.(1)(12) services secured
3025 Windward Plaza, revolving
Ste 200. Alpharetta, loan
GA
Granicus, Inc.(1)(4) Internet First lien L + 1/29/2027 0.0 % 13,495 13,211 13,259
1999 Broadway, Suite software and senior 6.50%
3600, Denver, CO services secured
80202 loan
Granicus, Internet First lien L + 1/30/2023 0.0 % 1,535 1,498 1,501
Inc.(1)(4)(12) software and senior 6.50%
1999 Broadway, Suite services secured
3600, Denver, CO delayed
80202 draw term
loan
Granicus, Inc.(1)(12) Internet First lien L + 1/29/2027 0.0 % - (24 ) (21 )
1999 Broadway, Suite software and senior 6.50%
3600, Denver, CO services secured
80202 revolving
loan
Guidehouse Inc.(1)(2) Professional First lien L + 10/16/2028 0.0 % 4,649 4,604 4,603
1676 International services senior 5.50%
Drive, Suite 800, secured
McLean, VA 22102 loan
Guidehouse Professional First lien L + 10/15/2027 0.0 % - - (4 )
Inc.(1)(12) services senior 5.50%
1676 International secured
Drive, Suite 800, revolving
McLean, VA 22102 loan
H&F Opportunities LUX Internet First lien L + 4/16/2026 0.0 % 51,567 50,388 51,567
III S.À R.L (dba software and senior 7.50%
Checkmarx)(1)(5) services secured
Amot Atrium Tower, 2 loan
Jabotinsky Street,
Ramat Gan 520501,
Israel
H&F Opportunities LUX Internet First lien L + 4/16/2026 0.0 % - (348 ) -
III S.À R.L (dba software and senior 7.50%
Checkmarx)(1)(12) services secured
Amot Atrium Tower, 2 revolving
Jabotinsky Street, loan
Ramat Gan 520501,
Israel
Hercules Borrower, Business First lien L + 12/15/2026 0.0 % 178,693 176,397 178,693
LLC (dba The Vincit services senior 6.50%
Group)(1)(4) secured
412 Georgia Avenue loan
#300 Chattanooga, TN
37403
Hercules Borrower, Business First lien L + 12/15/2026 0.0 % - (259 ) -
LLC (dba The Vincit services senior 6.50%
Group)(1)(12) secured
412 Georgia Avenue revolving
#300 Chattanooga, TN loan
37403
Hercules Buyer, LLC Business Unsecured 0.48% 12/14/2029 0.0 % 5,135 5,135 5,135
(dba The Vincit services notes PIK
Group)
412 Georgia Avenue
#300 Chattanooga, TN
37403
Hercules Buyer, LLC Business Common N/A N/A 0.3 % 2,190,000 2,192 2,192
(dba The Vincit services Units
Group)
412 Georgia Avenue
#300 Chattanooga, TN
37403
H-Food Holdings, Food and Second lien L + 3/2/2026 0.0 % 121,800 119,919 121,800
LLC(1)(2) beverage senior 7.00%
3500 Lacey Road, secured
Suite 300Downers loan
Grove IL 60515
H-Food Holdings, LLC Food and LLC N/A N/A 0.9 % 10,875 10,875 13,633
3500 Lacey Road, beverage Interest
Suite 300Downers
Grove IL 60515
Hg Genesis 8 Sumoco Financial Unsecured S + 8/28/2025 0.0 % 47,207 46,102 47,207
Limited(1)(11) services facility 7.50%
2 More London PIK
Riverside London SE1
2AP UK
95--------------------------------------------------------------------------------
Hg Saturn Luchaco Financial Unsecured S + 3/30/2026 0.0 % 133,862 135,510 132,523 Limited(1)(11) services facility 7.50% 1 Royal Plaza Royal PIK AvenueSt Peter Port GUERNSEY GY1 2HL HGH Purchaser, Inc. Household First lien L + 11/3/2025 0.0 % 108,230 106,916 107,418 (dba Horizon products senior 5.75% Services)(1)(4) secured 900 Adams Avenue loan Audubon, PA 19403 HGH Purchaser, Inc. Household First lien L + 2/10/2023 0.0 % 33,699 33,376 33,429 (dba Horizon products senior 5.75% Services)(1)(3)(12) secured 900 Adams Avenue delayed Audubon, PA 19403 draw term loan HGH Purchaser, Inc. Household First lien L + 11/3/2025 0.0 % 2,689 2,596 2,616 (dba Horizon products senior 5.75% Services)(1)(4)(12) secured 900 Adams Avenue revolving Audubon, PA 19403 loan Hometown Food Food and First lien L + 8/31/2023 0.0 % 15,947 15,830 15,787 Company(1)(2) beverage senior 5.00% 1 Strawberry secured LaneOrrville, Ohio loan 44667-0280 Hometown Food Food and First lien L + 8/31/2023 0.0 % - (28 ) (42 ) Company(1)(12) beverage senior 5.00% 1 Strawberry secured LaneOrrville, Ohio revolving 44667-0280 loan Hyland Software, Internet Second lien L + 7/7/2025 0.0 % 15,482 15,468 15,579 Inc.(1)(2) software and senior 6.25% 28500 Clemens Road, services secured Westlake, OH 44145 loan Ideal Tridon Manufacturing First lien L + 7/31/2024 0.0 % 53,209 52,784 53,209 Holdings, Inc.(1)(4) senior 5.25% 8100 Tridon Drive secured Smyrna, TN USA loan 37167-6603 Ideal Tridon Manufacturing First lien L + 7/31/2023 0.0 % 1,800 1,782 1,800 Holdings, senior 5.25% Inc.(1)(2)(12) secured 8100 Tridon Drive revolving Smyrna, TN USA loan 37167-6603 IG Investments Human First lien L + 9/22/2028 0.0 % 50,898 49,915 50,008 Holdings, LLC (dba resource senior 6.00% Insight Global)(1)(4) support secured 1224 Hammond Dr Suite services loan 1500, Atlanta, GA 30346 IG Investments Human First lien L + 9/22/2027 0.0 % 1,987 1,911 1,917 Holdings, LLC (dba resource senior 6.00% Insight support secured Global)(1)(4)(12) services revolving 1224 Hammond Dr Suite loan 1500, Atlanta, GA 30346 Individual Distribution First lien L + 11/21/2025 0.0 % 140,861 138,813 140,156 Foodservice Holdings, senior 6.25% LLC(1)(4) secured 5496 Lindbergh Lane loan Bell, CA 90201 Individual Distribution First lien L + 6/30/2022 0.0 % 28,084 27,594 27,909 Foodservice Holdings, senior 6.25% LLC(1)(5)(12) secured 5496 Lindbergh Lane delayed Bell, CA 90201 draw term loan Individual Distribution First lien L + 11/22/2024 0.0 % 959 690 851 Foodservice Holdings, senior 6.25% LLC(1)(2)(12) secured 5496 Lindbergh Lane revolving Bell, CA 90201 loan Inovalon Holdings, Healthcare First lien L + 11/24/2028 0.0 % 177,727 173,336 173,283 Inc.(1)(4) technology senior 5.75% 4321 Collington Rd, secured Bowie, MD 20716 loan 96
--------------------------------------------------------------------------------
Inovalon Holdings, Healthcare First lien L + 5/24/2024 0.0 % - (234 ) (237 )
Inc.(1)(12) technology senior 5.75%
4321 Collington Rd, secured
Bowie, MD 20716 delayed
draw term
loan
Inovalon Holdings, Healthcare Second lien L + 11/24/2033 0.0 % 84,661 82,975 82,967
Inc.(1)(4) technology senior 10.50%
4321 Collington Rd, secured PIK
Bowie, MD 20716 loan
Integrity Marketing Insurance First lien L + 8/27/2025 0.0 % 218,876 216,446 218,876
Acquisition, senior 5.75%
LLC(1)(5) secured
9111 Cypress Waters loan
Blvd Suite
450Coppell, TX 75019
Integrity Marketing Insurance First lien L + 8/27/2025 0.0 % - (135 ) -
Acquisition, senior 5.75%
LLC(1)(12) secured
9111 Cypress Waters revolving
Blvd Suite loan
450Coppell, TX 75019
Intelerad Medical Healthcare First lien L + 8/21/2026 0.0 % 115,684 114,517 115,395
Systems Incorporated technology senior 6.25%
(fka 11849573 Canada secured
Inc.)(1)(4) loan
800 Boulevard de
Maisonneuve East
12th floor,
Montreal, Quebec H2L
4L8, Canada
Intelerad Medical Healthcare First lien L + 8/21/2026 0.0 % 2,983 2,944 2,972
Systems Incorporated technology senior 6.25%
(fka 11849573 Canada secured
Inc.)(1)(4)(12) revolving
800 Boulevard de loan
Maisonneuve East
12th floor,
Montreal, Quebec H2L
4L8, Canada
Interoperability Healthcare First lien L + 6/25/2026 0.0 % 75,270 74,616 75,270
Bidco, Inc.(1)(5) technology senior 5.75%
100 High Street, secured
Suite 1560Boston, MA loan
02110
Interoperability Healthcare First lien L + 6/25/2024 0.0 % - (25 ) -
Bidco, Inc.(1)(12) technology senior 5.75%
100 High Street, secured
Suite 1560Boston, MA revolving
02110 loan
IQN Holding Corp. Internet First lien L + 8/20/2024 0.0 % 150,639 149,528 150,639
(dba Beeline)(1)(5) software senior 5.50%
12724 Gran Bay and secured
Parkway West, Suite services loan
200 Jacksonville, FL
32258-4467
IQN Holding Corp. Internet First lien L + 8/21/2023 0.0 % - (111 ) -
(dba Beeline)(1)(12) software senior 5.50%
12724 Gran Bay and secured
Parkway West, Suite services revolving
200 Jacksonville, FL loan
32258-4467
KPSKY Acquisition, Business First lien L + 10/19/2028 0.0 % 4,476 4,389 4,386
Inc. (dba services senior 5.50%
BluSky)(1)(2) secured
9110 East Nichols loan
Avenue, Suite 180
Centennial, CO 80112
KPSKY Acquisition, Business First lien P + 10/19/2023 0.0 % 256 248 248
Inc. (dba services senior 4.50%
BluSky)(1)(7)(12) secured
9110 East Nichols delayed
Avenue, Suite 180 draw term
Centennial, CO 80112 loan
KS Management Healthcare First lien L + 1/9/2026 0.0 % 122,500 121,420 122,500
Services, providers senior 4.25%
L.L.C.(1)(5) and secured
2727 West Holcombe services loan
Boulevard Houston,
TX 77025
97--------------------------------------------------------------------------------
Lazer Spot G B Transportation First lien L + 5.75%
senior
6525 Shiloh Rd #900 secured
Alpharetta, GA 30005 loan
Lazer Spot G B Transportation First lien L + 5.75% 12/9/2025 0.0 % - (304 ) -
Holdings, Inc.(1)(12) senior
6525 Shiloh Rd #900 secured
Alpharetta, GA 30005 revolving
loan
Learning Care Group Education Second lien L + 7.50% 3/13/2026 0.0 % 26,967 26,663 26,293
(US) No. 2 Inc.(1)(4) senior
21333 Haggerty Rd., secured
Suite 100Novi, MI loan
48375
Lignetics Investment Consumer First lien L + 6.00%
products senior
1075 E. South Boulder secured
Rd. Ste. 210 loan
- (48 ) (49 )
Corp.(1)(12) products senior
1075 E. South Boulder secured
Rd. Ste. 210 delayed
Louisville, CO 80027 draw term
loan
Lignetics Investment Consumer First lien L + 6.00%
727 725
Corp.(1)(4)(12) products senior
1075 E. South Boulder secured
Rd. Ste. 210 revolving
Louisville, CO 80027 loan
LineStar Integrity Infrastructure First lien L + 7.25%
senior
5391 Bay Oaks Dr. environmental secured
Pasadena, TX 77505 services loan
Litera Bidco Internet First lien L + 5.87% 5/29/2026 0.0 % 154,049 152,423 154,049
LLC(1)(2) software and senior
300 South Riverside services secured
Plaza Suite 800 loan
Chicago, IL 60606
Litera Bidco Internet First lien L + 6.00% 10/29/2022 0.0 % 1,998 1,943 1,998
LLC(1)(2)(12) software and senior
300 South Riverside services secured
Plaza Suite 800 delayed
Chicago, IL 60606 draw term
loan
Litera Bidco Internet First lien L + 5.75% 5/29/2026 0.0 % - (44 ) -
LLC(1)(12) software and senior
300 South Riverside services secured
Plaza Suite 800 revolving
Chicago, IL 60606 loan
senior
DriveSan Diego, CA secured
92121 loan
Medline Intermediate, Healthcare First lien L + 3.25%
- (155 ) (162 )
LP(1)(12) equipment and senior
Three Lakes Drive services secured
Northfield, IL 60093 revolving
loan
MessageBird BidCo Internet First lien L + 6.75%
software and senior
Trompenburgstraat 2C, services secured
1079 TX Amsterdam, loan
0.0 % 122,890 753 753
B.V. software and Series C
Trompenburgstraat 2C, services Warrants
1079 TX Amsterdam,
Netherlands
Metis HoldCo, Inc. Automotive Series A 7.00% PIK N/A 0.0 % 149,692 151,894 155,888
(dba Mavis Tire Convertible
Express Services) Preferred
358 Saw Mill River Stock
Road, Suite 17
Millwood, NY 10546
MHE Intermediate Manufacturing First lien L + 5.75%
7/21/2027 0.0 % 160,321 158,816 158,718
Holdings, LLC (dba senior
OnPoint Group)(1)(4) secured
3201 Levis Commons loan
BlvdPerrysburg, OH
43551
98--------------------------------------------------------------------------------
MHE Intermediate Manufacturing First lien L +
0.0 % 13,420 13,291 13,286 Holdings, LLC (dba senior 5.75% OnPoint secured Group)(1)(4)(12) delayed 3201 Levis Commons draw term BlvdPerrysburg, OH loan 43551 MHE Intermediate Manufacturing First lien L + 7/21/2027 0.0 % - (144 ) (155 ) Holdings, LLC (dba senior 5.75% OnPoint Group)(1)(12) secured 3201 Levis Commons revolving BlvdPerrysburg, OH loan
43551
Milan Laser Holdings Specialty First lien L +
0.0 % 24,299 24,080 24,117 LLC(1)(4) Retail senior 5.00% 17645 Wright Street, secured Suite 300 Omaha, NE loan 68130 Milan Laser Holdings Specialty First lien L + 4/27/2026 0.0 % - (18 ) (16 ) LLC(1)(12) Retail senior 5.00% 17645 Wright Street, secured Suite 300 Omaha, NE revolving 68130 loan MINDBODY, Inc.(1)(5) Internet First lien L + 2/14/2025
0.0 % 67,127 66,713 67,127
loan 1.50%
PIK)
0.0 % - (32 ) -
651 Tank Farm Road, software and senior 7.00%
San Luis Obispo, CA services secured
revolving
loan
VEPF Torreys Internet Series A 6.00% N/A 0.8 % 21,500 21,250 21,250
Aggregator, LLC (dba software and Preferred PIK
MINDBODY, Inc.) services Stock
651 Tank Farm Road ,
San Luis Obispo, CA
Ministry Brands Internet First lien L + 12/29/2028 0.0 % 706 692 692
loan
Ministry Brands Internet First lien L +
0.0 % - (2 ) (2 )
delayed
draw term
loan
Ministry Brands Internet First lien L +
0.0 % - (1 ) (1 )
revolving
loan
Motus Group, Transportation Second lien L + 12/10/2029 0.0 % 10,810 10,702 10,702
LLC(1)(4) senior 6.50%
Two Financial secured
Center60 South loan
Street, Boston, MA
02111
Muine Gall, LLC(1)(5) Financial First lien L + 9/20/2024
0.0 % 239,896 240,229 239,896
secured PIK
loan
National Dentex Labs Healthcare First lien L +
0.0 % 70,723 69,731 70,192
LLC (fka Barracuda providers and senior 7.00%
Dental LLC)(1)(4) services secured
11601 Kew Gardens loan
Ave, Suite 200, Palm
Beach Gardens, FL
33410
National Dentex Labs Healthcare First lien L + 3/31/2022 0.0 % 35,582 35,166 35,315
LLC (fka Barracuda providers and senior 7.00%
Dental LLC)(1)(4)(12) services secured
11601 Kew Gardens delayed
Ave, Suite 200, Palm draw term
Beach Gardens, FL loan
33410
99--------------------------------------------------------------------------------
National Dentex Labs Healthcare First lien L + 7.00%
0.0 % 3,044 2,853 2,974 LLC (fka Barracuda providers senior Dental LLC)(1)(4)(12) and secured 11601 Kew Gardens services revolving Ave, Suite 200, Palm loanBeach Gardens , FL 33410 Nelipak Holding Healthcare First lien L + 4.25% 7/2/2026 0.0 % 24,760 24,419 24,450 Company(1)(4) equipment senior 21 Amflex and secured DriveCranston, RI, services loan 02921, USA Nelipak Holding Healthcare First lien L + 4.25% 7/2/2024 0.0 % 3,082 3,008 2,990 Company(1)(4)(12) equipment senior 21 Amflex and secured DriveCranston, RI, services revolving 02921, USA loan Nelipak Holding Healthcare First lien E + 4.50% 7/2/2024 0.0 % - (261 ) (94 ) Company(1)(12) equipment senior 21 Amflex and secured DriveCranston, RI, services revolving 02921, USA loan Nelipak Holding Healthcare Second lien L + 8.25% 7/2/2027 0.0 % 67,006 66,237 66,336 Company(1)(4) equipment senior 21 Amflex and secured DriveCranston, RI, services loan 02921, USA Nelipak Holding Healthcare Second lien E + 8.50% 7/2/2027 0.0 % 68,346 66,496 67,321 Company(1)(9) equipment senior 21 Amflex and secured DriveCranston, RI, services loan 02921, USA Nellson Food and First lien L + 5.25% 12/23/2023 0.0 % 27,280 26,586 26,735 Nutraceutical, beverage senior LLC(1)(4) secured 5115 E. La Palma Ave loan Anaheim, CA 92807 NMI Acquisitionco, Financial First lien L + 5.75% 9/8/2025 0.0 % 25,313 25,158 25,148 Inc. (dba Network services senior Merchants)(1)(2) secured 201 Main St.Roselle, loan IL 60172 NMI Acquisitionco, Financial First lien L + 5.75% 10/2/2023 0.0 % 4,978 4,877 4,945 Inc. (dba Network services senior Merchants)(1)(2)(12) secured 201 Main St.Roselle, delayed IL 60172 draw term loan NMI Acquisitionco, Financial First lien L + 5.75% 9/8/2025 0.0 % - (18 ) (11 ) Inc. (dba Network services senior Merchants)(1)(12) secured 201 Main St.Roselle, revolving IL 60172 loan Norvax, LLC (dba Insurance First lien L + 6.50% 9/15/2025 0.0 % 77,376 75,139 77,763 GoHealth)(1)(4) senior 214 West Huron secured St.Chicago, IL 60654 loan
0.0 % 9,511 9,412 9,511
GoHealth)(1)(2)(12) senior
214 West Huron secured
St.Chicago, IL 60654 revolving
loan
Norvax, LLC (dba Insurance Common N/A N/A 0.3 % 1,021,885 5,232 3,873 GoHealth)
Stock
214 West Huron
St.Chicago, IL 60654
Notorious Topco, LLC Specialty First lien L + 6.50% 11/22/2027 0.0 % 110,460 108,827 108,803
(dba Beauty Industry Retail senior
Group)(1)(4) secured
631 N 400 W, Salt loan
Lake City, UT 84103
Notorious Topco, LLC Specialty First lien L + 6.50% 11/23/2023 0.0 % - (98 ) (40 )
(dba Beauty Industry Retail senior
Group)(1)(12) secured
631 N 400 W, Salt delayed
Lake City, UT 84103 draw term
loan
100--------------------------------------------------------------------------------
Notorious Topco, LLC Specialty First lien L + 5/24/2027 0.0 % 1,596 1,455 1,453 (dba Beauty Industry Retail senior 6.50% Group)(1)(4)(12) secured 631 N 400 W, Salt revolving Lake City, UT 84103 loan Nutraceutical Food and First lien L + 9/30/2026 0.0 % 211,824 209,206 207,587 International beverage senior 7.00% Corporation(1)(2) secured 1777 Sun Peak Drive, loanPark City, UT 84098 Nutraceutical Food and First lien L + 9/30/2025 0.0 % 13,578 13,426 13,307 International beverage senior 7.00% Corporation(1)(2) secured 1777 Sun Peak Drive, revolving Park City, UT 84098 loan OB Hospitalist Group, Healthcare First lien L + 9/27/2027 0.0 % 116,855 114,603 114,518 Inc.(1)(4) providers senior 5.50% 777 Lowndes Hill Rd and services secured bldg 1, Greenville, loan SC 29607 OB Hospitalist Group, Healthcare First lien L + 9/27/2027 0.0 % 1,616 1,326 1,313 Inc.(1)(2)(12) providers senior 5.50% 777 Lowndes Hill Rd and services secured bldg 1, Greenville, revolving SC 29607 loan Ex Vivo Parent Inc. Healthcare First lien L + 9/27/2028 0.0 % 57,810 56,685 56,654 (dba OB providers senior 9.50% Hospitalist)(1)(4) and services secured PIK 777 Lowndes Hill Rd loan bldg 1, Greenville, SC 29607 KOBHG Holdings, L.P. Healthcare Class A N/A N/A 1.4 % 6,670 6,670 6,670 (dba OB Hospitalist) providers Interests 777 Lowndes Hill Rd and services bldg 1, Greenville, SC 29607 Offen, Inc.(1)(2) Distribution First lien L + 6/22/2026 0.0 % 19,582 19,450 19,582 5100 East 78th senior 5.00% AvenueCommerce City, secured CO 80022 loan ORCC Senior Loan Fund Investment LLC N/A N/A 87.5 % 249,714 249,714 247,061 LLC (fka Sebago Lake funds and Interest LLC)(13) vehicles399 Park Avenue , 38th Floor, New York, NY 10022 Packaging Healthcare Second lien L + 11/30/2028 0.0 % 196,044 192,494 192,123 Coordinators Midco, equipment senior 7.00% Inc.(1)(4) and services secured 3001 Red Lion Road loan Philadelphia, PA 19114 United States KPCI Holdings, LP Healthcare Class A N/A N/A 1.3 % 30,425 32,285 37,331 3001 Red Lion Road equipment Units Philadelphia, PA and services 19114 United States Patriot Acquisition Healthcare First lien L + 1/31/2028 0.0 % 136,736 134,627 135,027 TopCo S.A.R.L (dba equipment senior 6.75% Corza Health, Inc.) and services secured (1)(4) loan 247 Stanton Drive Westwood, MA, 02090 Patriot Acquisition Healthcare First lien L + 1/29/2026 0.0 % - (229 ) (169 ) TopCo S.A.R.L (dba equipment senior 6.75% Corza Health, Inc.) and services secured (1)(12) revolving 247 Stanton Drive loan Westwood, MA, 02090 Patriot Holdings SCSp Healthcare Class A 8.00% N/A 1.0 % 7,104 7,633 7,633 (dba Corza Health, equipment Units PIK Inc.) and services 247 Stanton Drive Westwood, MA, 02090 101
--------------------------------------------------------------------------------
Patriot Holdings SCSp Healthcare Class B N/A N/A
0.8 % 97,833 18 1,109
(dba Corza Health, equipment and Units
Inc.) services
247 Stanton Drive
Westwood, MA, 02090
Peraton Corp.(1)(2) Aerospace and Second lien L + 7.75% 2/1/2029
0.0 % 47,500 46,840 47,263
12975 Worldgate defense senior
Drive,
secured
20170 loan
0.0 % 108,430 107,368 107,347
Associates Insurance senior
Services, LLC (dba secured
PCF Insurance loan
Services)(1)(4)
6200 Canoga Avenue,
Suite 325, Woodland
Hills, CA 91367
Peter C. Foy & Insurance First lien L + 6.00% 5/1/2023
0.0 % 19,143 18,953 18,952
Associates Insurance senior
Services, LLC (dba secured
PCF Insurance delayed
Services)(1)(5)(12) draw term
6200 Canoga Avenue, loan
Suite 325, Woodland
Hills, CA 91367
Peter C. Foy & Insurance First lien L + 6.00% 11/1/2027 0.0 % - (60 ) (62 )
Associates Insurance senior
Services, LLC (dba secured
PCF Insurance revolving
Services)(1)(12) loan
6200 Canoga Avenue,
Suite 325, Woodland
Hills, CA 91367
PCF Midco II, LLC Insurance First lien 9.00% PIK 10/31/2031 0.0 % 118,693 107,530 107,418
(dba PCF Insurance senior
Services) secured
6200 Canoga Avenue, loan
Suite 325, Woodland
Hills, CA 91367
PCF Holdco, LLC (dba Insurance Class A N/A N/A 2.7 % 11,028 27,968 27,968
PCF Insurance Units
Services)
6200 Canoga Avenue,
Suite 325, Woodland
Hills, CA 91367
PCF Holdco, LLC (dba Insurance Class A N/A N/A 0.9 % 3,744 9,496 9,496
PCF Insurance Warrants
Services)
6200 Canoga Avenue,
Suite 325, Woodland
Hills, CA 91367
PHM Netherlands Midco Manufacturing First lien L + 4.50% 7/31/2026 0.0 % 786 738 782
B.V. (dba senior
Loparex)(1)(4) secured
1255 Crescent Green loan
Suite 400 Cary, NC
27518
PHM Netherlands Midco Manufacturing Second lien L + 8.75% 7/30/2027 0.0 % 112,000 105,916 110,600
B.V. (dba senior
Loparex)(1)(2) secured
1255 Crescent Green loan
Suite 400 Cary, NC
27518
Phoenix Newco, Inc. Healthcare Second lien L + 6.50% 11/15/2029 0.0 % 190,000 188,123 188,100
(dba Parexel)(1)(2) providers and senior
275 Grove St., Suite services secured
101C, Newton, MA loan
02466
Pluralsight, Education First lien L + 8.00% 4/6/2027 0.0 % 99,450 98,526 98,455
LLC(1)(5) senior
42 Future Way Draper, secured
UT, 84020 loan
Pluralsight, Education First lien L + 8.00% 4/6/2027 0.0 % - (55 ) (62 )
LLC(1)(12) senior
42 Future Way Draper, secured
UT, 84020 revolving
loan
102--------------------------------------------------------------------------------
Pregis Topco LLC(1)(4) Containers Second lien L + 8/1/2029 0.0 % 160,000 157,467 160,000 1650 Lake Cook Road, and senior 6.95% Suite 400Deerfield, IL packaging secured loan 60015 USAPremier Imaging, LLC Healthcare First lien L + 1/2/2025 0.0 % 42,998 42,517 42,675 (dba providers senior 5.25% LucidHealth)(1)(2) and services secured loan 100 E. Campus View Blvd., Suite 100Columbus, Ohio 43235 Project Power Buyer, Oil and gas First lien L + 5/14/2026 0.0 % 45,091 44,664 45,091 LLC (dba senior 6.00% PEC-Veriforce)(1)(4) secured loan 233 General Patton Ave. Mandeville, LA 70471 Project Power Buyer, Oil and gas First lien L + 5/14/2025 0.0 % - (22 ) - LLC (dba senior 6.00% PEC-Veriforce)(1)(12) secured 233 General Patton revolving Ave. Mandeville, LA loan 70471 Proofpoint, Inc.(1)(4) Internet Second lien L + 8/31/2029 0.0 % 19,600 19,505 19,502 925 West Maude Avenue software and senior 6.25% Sunnyvale, CA 94085 services secured loan PS Operating Company Distribution First lien L + 12/31/2024 0.0 % 13,241 12,979 12,976 LLC (fka QC Supply, senior 6.00% LLC)(1)(4)(13) secured loan 574 Road 11Schuyler, NE 68661 PS Operating Company Distribution First lien L + 12/31/2024 0.0 % 2,319 2,171 2,219 LLC (fka QC Supply, senior 6.00% LLC)(1)(4)(12)(13) secured 574 Road 11Schuyler, revolving NE 68661 loan PS Op Holdings LLC(13) Distribution Class A N/A N/A 33.1 % 248,271 4,300 4,300 574 Road 11Schuyler, Common Units NE 68661 QAD, Inc.(1)(3) Internet First lien L + 11/5/2027 0.0 % 26,571 26,051 26,040 100 Innovation Place software and senior 6.00% Santa Barbara, CA services secured loan 93108 QAD, Inc.(1)(12) Internet First lien L + 11/5/2027 0.0 % - (67 ) (69 ) 100 Innovation Place software and senior 6.00% Santa Barbara, CA services secured 93108 revolving loan Quva Pharma, Healthcare First lien L + 4/12/2028 0.0 % 39,900 38,802 38,803 Inc.(1)(4) providers senior 5.50% 3 Sugar Creek Center and services secured loan Blvd, Suite 250. Sugar Land, TX 77478 Quva Pharma, Healthcare First lien L + 4/10/2026 0.0 % - (103 ) (110 ) Inc.(1)(12) providers senior 5.50% 3 Sugar Creek Center and services secured Blvd, Suite 250. Sugar revolving Land, TX 77478 loan REALPAGE, INC.(1)(2) Buildings Second lien L + 4/23/2029 0.0 % 34,500 34,017 34,897 2201 Lakeside Blvd. and real senior 6.50% Richardson, Texas estate secured loan 75082 Recipe Acquisition Food and Second lien L + 12/1/2022 0.0 % 32,000 31,881 30,080 Corp. (dba Roland beverage senior 9.00% Corporation)(1)(4) secured loan 71 West 23rd StreetNew York, NY 10010 Reef Global Buildings First lien L + 11/28/2024 0.0 % 134,585 133,921 128,528 Acquisition LLC (fka and real senior 6.00% Cheese Acquisition, estate secured loan (incl. LLC)(1)(5) 1.25% 233 Peachtree Street PIK)NE Harris Tower , Suite 2600, Atlanta, GA 30303 103
--------------------------------------------------------------------------------
Imperial Parking Buildings and First lien C + 11/28/2024 0.0 % 27,966 26,705 26,707
Canada(1)(8) real estate senior 6.00%
233 Peachtree Street secured (incl.
NE Harris Tower, loan 1.25%
Suite 2600, Atlanta, PIK)
GA 30303
Reef Global Buildings and First lien L + 11/28/2023 0.0 % 10,987 10,982 10,251
Acquisition LLC (fka real estate senior 4.75%
Cheese Acquisition, secured
LLC)(1)(2)(12) revolving
233 Peachtree Street loan
NE Harris Tower,
Suite 2600, Atlanta,
GA 30303
Refresh Parent Healthcare First lien L + 12/9/2026 0.0 % 88,973 87,832 88,306
Holdings, Inc.(1)(4) providers and senior 6.50%
320 1st Street services secured
North, Suite 712 loan
Jacksonville Beach,
FL 32250
Refresh Parent Healthcare First lien L + 6/9/2022 0.0 % 28,463 28,098 28,243
Holdings, providers and senior 6.50%
Inc.(1)(4)(12) services secured
320 1st Street delayed
North, Suite 712 draw term
Jacksonville Beach, loan
FL 32250
Refresh Parent Healthcare First lien L + 12/9/2026 0.0 % 3,879 3,746 3,799
Holdings, providers and senior 6.50%
Inc.(1)(4)(12) services secured
320 1st Street revolving
North, Suite 712 loan
Jacksonville Beach,
FL 32250
Restore OMH Healthcare Senior 13.00% N/A 0.6 % 2,616 25,566 25,506
Intermediate providers and Preferred PIK
Holdings, Inc. services Stock
320 1st Street
North, Suite 712
Jacksonville Beach,
FL 32250
Relativity ODA Professional First lien L + 5/12/2027 0.0 % 77,263 76,255 76,297
LLC(1)(2) services senior 7.50%
231 South LaSalle secured PIK
Street, 8th Floor loan
Chicago, IL 60604
Relativity ODA Professional First lien L + 5/12/2027 0.0 % - (98 ) (92 )
LLC(1)(12) services senior 6.50%
231 South LaSalle secured
Street, 8th Floor revolving
Chicago, IL 60604 loan
Safety Products/JHC Manufacturing First lien L + 6/28/2026 0.0 % 13,923 13,829 12,948
Acquisition Corp. senior 4.50%
(dba Justrite Safety secured
Group)(1)(2) loan
3921 DeWitt
AveMattoon, IL 61938
U.S.A.
Sara Lee Frozen Food and First lien L + 7/30/2025 0.0 % 43,860 43,377 41,668
Bakery, LLC (fka beverage senior 4.50%
KSLB Holdings, secured
LLC)(1)(2) loan
3500 Lacey RdDowners
Grove, IL 60515
Sara Lee Frozen Food and First lien P + 7/30/2023 0.0 % 300 236 (150 )
Bakery, LLC (fka beverage senior 3.50%
KSLB Holdings, secured
LLC)(1)(7)(12) revolving
3500 Lacey RdDowners loan
Grove, IL 60515
Shearer's Foods, Food and Second lien L + 9/22/2028 0.0 % 120,000 118,973 120,000
LLC(1)(2) beverage senior 7.75%
100 Lincoln Way secured
East, Massillon, loan
Ohio 44646
Sonny's Enterprises Manufacturing First lien L + 8/5/2026 0.0 % 232,258 228,600 232,258
LLC(1)(2) senior 6.75%
5605 Hiatus Road secured
Tamarac, FL 33321 loan
Sonny's Enterprises Manufacturing First lien L + 8/5/2025 0.0 % 2,567 2,309 2,567
LLC(1)(2)(12) senior 6.75%
5605 Hiatus Road secured
Tamarac, FL 33321 revolving
loan
104--------------------------------------------------------------------------------
Space Exploration Aerospace Class A N/A N/A
0.0 % 3,232 1,557 1,810
Technologies and defense Common
Corp.(14) Stock
1 Rocket Road ,
Hawthorne, CA 90250
Space Exploration Aerospace Class C N/A N/A 0.0 % 936 446 524
Technologies and defense Common
Corp.(14) Stock
1 Rocket Road,
Hawthorne, CA 90250
Swipe Acquisition Advertising First lien L + 8.00% 6/29/2024 0.0 % 50,044 49,316 49,419
Corporation (dba and media senior
PLI)(1)(4)(13) secured
1220 Trade DriveNorth loan
Las Vegas, NV 89030
Swipe Acquisition Advertising First lien L + 8.00% 12/30/2022 0.0 % 10,899 10,899 10,635 Corporation (dba and media senior PLI)(1)(4)(12)(13)
secured
1220 Trade DriveNorth delayed
Las Vegas, NV 89030 draw term
loan
Swipe Acquisition Advertising Letter of L + 8.00% 6/29/2024 0.0 % - 3 -
Corporation (dba and media Credit
PLI)(1)(12)(13)
1220 Trade DriveNorth
Las Vegas, NV 89030
New PLI Holdings, Advertising Class A N/A N/A 86.7 % 86,745 48,007 48,007 LLC(13)
and media Common
1220 Trade DriveNorth Units
Las Vegas, NV 89030
Tahoe Finco, Internet First lien L + 6.00% 9/29/2028 0.0 % 123,255 122,057 121,777
LLC(1)(4) software senior
and secured
services loan
Tahoe Finco, Internet First lien L + 6.00% 10/1/2027 0.0 % - (89 ) (111 )
LLC(1)(12) software senior
and secured
services revolving
loan0.0 % 39,684 39,609 40,477 Inc.(1)(2) beverage senior 1190 West Loop secured SouthHouston, TX loan 77028 TC Holdings, LLC (dba Healthcare First lien L + 4.50% 11/14/2023
0.0 % 73,081 72,560 73,081
secured
Dr #300, Morrisville, services loan
NC 27560
TC Holdings, LLC (dba Healthcare First lien L + 4.50% 11/14/2022 0.0 % - (27 ) -
TrialCard)(1)(12) providers senior
2250 Perimeter Park and secured
Dr #300, Morrisville, services revolving
NC 27560 loan
TEMPO BUYER CORP. Insurance First lien L + 5.50%
0.0 % 1,089 1,068 1,067 (dba Global Claims senior Services)(1)(4) secured 6745 Philips loanIndustrial Blvd , Jacksonville, FL 32256 TEMPO BUYER CORP. Insurance First lien L + 5.50% 8/26/2023 0.0 % - (3 ) (3 ) (dba Global Claims senior Services)(1)(12) secured 6745 Philips delayed Industrial Blvd, draw term Jacksonville, FL loan 32256 TEMPO BUYER CORP. Insurance First lien L + 5.50% 8/28/2028 0.0 % - (3 ) (3 ) (dba Global Claims senior Services)(1)(12) secured 6745 Philips revolving Industrial Blvd, loan Jacksonville, FL 32256 The Shade Store, Specialty First lien L + 6.00% 10/13/2027 0.0 % 9,091 8,981 8,977 LLC(1)(4) Retail senior 21 Abendroth Avenue secured Port Chester, NY loan 10573 USA The Shade Store, Specialty First lien L + 6.00% 10/13/2026 0.0 % - (11 ) (11 ) LLC(1)(12) Retail senior 21 Abendroth Avenue secured Port Chester, NY revolving 10573 USA loan 105
--------------------------------------------------------------------------------
0.0 % 75,513 74,093 74,569 (dba Hilb)(1)(4) senior 5.75% 6802 Paragon Place, secured Suite 200 Richmond, loanVirginia 23230 THG Acquisition, LLC Insurance First lien L + 12/2/2025 0.0 % - (151 ) (107 ) (dba Hilb)(1)(12) senior 5.75% 6802 Paragon Place, secured Suite 200 Richmond, revolving Virginia 23230 loan Thunder Purchaser, Internet First lien L + 6/30/2028 0.0 % 64,802 64,189 64,357 Inc. (dba Vector software and senior 5.75% Solutions)(1)(4) services secured 4890 W. Kennedy Blvd, loan Suite 300,Tampa, FL 33609 Thunder Purchaser, Internet First lien L + 8/17/2023 0.0 % - - (41 ) Inc. (dba Vector software and senior 5.75% Solutions)(1)(12) services secured 4890 W. Kennedy Blvd, delayed Suite 300, Tampa, FL draw term 33609 loan Thunder Purchaser, Internet First lien L + 6/30/2027 0.0 % - (35 ) (29 ) Inc. (dba Vector software and senior 5.75% Solutions)(1)(12) services secured 4890 W. Kennedy Blvd, revolving Suite 300, Tampa, FL loan 33609 Thunder Topco L.P. Internet Common N/A N/A 0.4 % 3,829,614 3,830 4,519 (dba Vector Solutions) software and Units 4890 W. Kennedy Blvd, services Suite 300,Tampa, FL 33609 Troon Golf, Leisure and First lien L + 8/5/2027 0.0 % 283,073 281,736 281,659 L.L.C.(1)(4) entertainment senior 6.00% 15044 N. Scottsdale secured Road, Suite loan 300Scottsdale, AZ 85254 Troon Golf, Leisure and First lien L + 8/5/2026 0.0 % - (99 ) (108 ) L.L.C.(1)(12) entertainment senior 6.00% 15044 N. Scottsdale secured Road, Suite revolving 300Scottsdale, AZ loan 85254 Ultimate Baked Goods Food and First lien L + 8/13/2027 0.0 % 82,053 80,108 80,003 Midco, LLC(1)(3) beverage senior 6.25% 828 Kasota Ave secured SEMinneapolis, MN loan 55414 Ultimate Baked Goods Food and First lien L + 8/13/2027 0.0 % 5,222 4,989 4,973 Midco, LLC(1)(5)(12) beverage senior 6.25% 828 Kasota Ave secured SEMinneapolis, MN revolving 55414 loan USRP Holdings, Inc. Insurance First lien L + 7/23/2027 0.0 % 39,087 38,349 38,306 (dba U.S. Retirement senior 5.50% and Benefits secured Partners)(1)(4) loan99 Wood Avenue South Suite 501,Iselin, NJ 08830 USRP Holdings, Inc. Insurance First lien L + 7/23/2027 0.0 % 71 (8 ) (14 ) (dba U.S. Retirement senior 5.50% and Benefits secured Partners)(1)(4)(12) revolving 99 Wood Avenue South loan Suite 501,Iselin, NJ 08830 KUSRP Intermediate, Insurance First lien 9.50% 7/24/2028 0.0 % 31,237 30,655 30,612 Inc. (dba U.S. senior PIK Retirement and secured Benefits loan Partners)(1)(4) 99 Wood Avenue South Suite 501,Iselin, NJ 08830 Valence Surface Aerospace and First lien L + 6/28/2025 0.0 % 121,823 120,674 110,249 Technologies LLC(1)(5) defense senior 6.75% 1790 Hughes Landing secured (incl. Blvd Ste. 300The loan 1.00% Woodlands, TX 77380 PIK) 106
--------------------------------------------------------------------------------
Valence Surface Aerospace and First lien L + 6/28/2025 0.0 % 9,984 9,897 9,031
Technologies defense senior 6.75%
LLC(1)(4)(12) secured (incl.
1790 Hughes Landing revolving 1.00%
Blvd Ste. 300The loan PIK)
Woodlands, TX 77380
Velocity HoldCo III Chemicals First lien L + 4/22/2027 0.0 % 22,215 21,763 21,771
Inc. (dba senior 5.75%
VelocityEHS)(1)(4) secured
222 Merchandise Mart loan
Plz Ste 1750 Chicago,
IL, 60654
Velocity HoldCo III Chemicals First lien L + 4/22/2026 0.0 % - (26 ) (27 )
Inc. (dba senior 5.75%
VelocityEHS)(1)(12) secured
222 Merchandise Mart revolving
Plz Ste 1750 Chicago, loan
IL, 60654
Walker Edison Household First lien L + 3/31/2027 0.0 % 84,258 84,258 80,047
Furniture Company products senior 8.75%
LLC(1)(4) secured (incl.
1553 West 9000 South loan 3.00%
West Jordan, Utah PIK)
84088
When I Work, Internet First lien L + 11/2/2027 0.0 % 4,932 4,884 4,883
Inc.(1)(4) software and senior 6.00%
420 N 5th St #500, services secured
Minneapolis, MN 55401 loan
When I Work, Internet First lien L + 11/2/2027 0.0 % - (9 ) (9 )
Inc.(1)(12) software and senior 6.00%
420 N 5th St #500, services secured
Minneapolis, MN 55401 revolving
loan
BCTO WIW Holdings, Internet Class A N/A N/A 0.5 % 13 1,300 1,300
Inc. (dba When I Work) software and Common
420 N 5th St #500, services Stock
Minneapolis, MN 55401
Windows Entities Manufacturing LLC Units N/A N/A 22.5 % 31,826 56,944 103,561
6201 E 43rd St , Tulsa,
OK 74135
Wingspire Capital Financial LLC N/A N/A 75.0 % 198,038 198,038 242,163
Holdings LLC(12)(13) services Interest
8000 Avalon Blvd.,
Suite 100, Alpharetta,
GA 30009
WMC Bidco, Inc. Professional Senior 11.25% N/A 1.3 % 16,692 16,247 16,233
311 W. Monroe St., services Preferred PIK
14th Floor, Chicago, Stock
IL 60606
WU Holdco, Inc. (dba Consumer First lien L + 3/26/2026 0.0 % 190,078 187,304 190,078
Weiman Products, products senior 5.50%
LLC)(1)(4) secured
705 Tri State loan
PkwyGurnee, IL 60031
WU Holdco, Inc. (dba Consumer First lien L + 5/21/2022 0.0 % - (129 ) -
Weiman Products, products senior 5.50%
LLC)(1)(12) secured
705 Tri State delayed
PkwyGurnee, IL 60031 draw term
loan
WU Holdco, Inc. (dba Consumer First lien L + 3/26/2025 0.0 % 5,762 5,529 5,762
Weiman Products, products senior 5.50%
LLC)(1)(4)(12) secured
705 Tri State revolving
PkwyGurnee, IL 60031 loan
Zenith Energy U.S. Oil and gas First lien L + 12/20/2024 0.0 % 64,476 63,728 64,476
Logistics Holdings, senior 5.50%
LLC(1)(4) secured
3900 Essex Lane Suite loan
950
Houston, TX 77027
107--------------------------------------------------------------------------------
________________
(1)
Loan contains a variable rate structure and may be subject to an interest rate
floor. Variable rate loans bear interest at a rate that may be determined by
reference to either the London Interbank Offered Rate ("LIBOR" or "L") (which
can include one-, two-, three- or six-month LIBOR) or an alternate base rate
(which can include the Federal Funds Effective Rate or the Prime Rate), at the
borrower's option, and which reset periodically based on the terms of the loan
agreement.
(2)
The interest rate on these loans is subject to 1 month LIBOR, which as of
December 31, 2021 was 0.10%.
(3)
The interest rate on these loans is subject to 2 month LIBOR, which as of
December 31, 2021 was 0.15%.
(4)
The interest rate on these loans is subject to 3 month LIBOR, which as of
December 31, 2021 was 0.21%.
(5)
The interest rate on these loans is subject to 6 month LIBOR, which as of
December 31, 2021 was 0.34%.
(6)
The interest rate on these loans is subject to 12 month LIBOR, which as of
December 31, 2021 was 0.58%.
(7)
The interest rate on this loan is subject to 6 month Canadian Dollar Offered
Rate ("CDOR" or "C"), which as of December 31, 2021 was 0.52%.
(8)
The interest rate on these loans is subject to Prime, which as of December 31,
2021 was 3.25%.
(9)
The interest rate on these loans is subject to 3 month EURIBOR, which as of
December 31, 2021 was (0.57)%.
(10)
The interest rate on these loans is subject to 6 month EURIBOR, which as of
December 31, 2021 was (0.55)%.
(11)
The interest rate on this loan is subject to SONIA, which as of December 31,
2021 was 0.47%.
(12)
Position or portion thereof is an unfunded loan commitment. See "ITEM 8.
CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA - Note 7. Commitments
and Contingencies."
(13)
As defined in the 1940 Act, the Company is deemed to be both an "Affiliated
Person" and has "Control" of this portfolio company as the Company owns more
than 25% of the portfolio company's outstanding voting securities or has the
power to exercise control over management or policies of such portfolio company
(including through a management agreement). Other than for purposes of the 1940
Act, the Company does not believe that it has control over this portfolio
company.
ORCC Senior Loan Fund (fkaSebago Lake LLC ), aDelaware limited liability company, was formed as a joint venture between us and The Regents of theUniversity of California ("Regents") and commenced operations onJune 20, 2017 . ORCC SLF's principal purpose is to make investments, primarily in senior secured loans that are made to middle-market companies or in broadly syndicated loans. ThroughJune 30, 2021 , both we and Regents (the "Initial Members") had a 50% economic ownership in ORCC SLF. Each of the Initial Members initially agreed to contribute up to$100 million to ORCC SLF. OnJuly 26, 2018 , each of the Initial Members increased their contribution to ORCC SLF up to an aggregate of$125 million . Effective as ofJune 30, 2021 , capital commitments to ORCC SLF were increased to an aggregate of$371.5 million . In connection with this change, the Company increased its economic ownership interest to 87.5% from 50.0% and Regents transferred its remaining economic interest of 12.5% toNationwide Life Insurance Company ("Nationwide" and together with us, the "Members" and each a "Member"). ORCC SLF is managed by the Members, each of which have equal voting rights. Investment decisions must be approved by each of the Members. Except under certain circumstances, contributions to ORCC SLF cannot be redeemed. We have determined that ORCC SLF is an investment company under Accounting Standards Codification ("ASC") 946, however, in accordance with such guidance, we will generally not consolidate our investment in a company other than a wholly owned investment company subsidiary or a controlled operating company whose business consists of providing services to us. Accordingly, we do not consolidate our non-controlling interest in ORCC SLF. As ofDecember 31, 2021 andDecember 31, 2020 , ORCC SLF had total investments in senior secured debt at fair value of$790.3 million and$554.7 million , respectively. The determination of fair value is in accordance withFinancial Accounting Standards Board ("FASB") Accounting Standards Codification 820, Fair Value Measurements ("ASC 820"), as amended; however, such fair value is not included in our Board's valuation process. The following table is a summary of ORCC SLF's portfolio as well as a listing of the portfolio investments in ORCC SLF's portfolio as ofDecember 31, 2021 andDecember 31, 2020 : ($ in thousands) December 31, 2021 December 31, 2020 Total senior secured debt investments(1) $ 798,420 $ 563,555 Weighted average spread over LIBOR(1) 4.14 % 4.45 % Number of portfolio companies 38
17
Largest funded investment to a single borrower(1) $ 40,693 $ 49,625 ________________ (1) At par.
($ in thousands)
108
--------------------------------------------------------------------------------
Amortized Percentage of
Company(1)(2)(4)(5) Investment Interest Maturity Date Par / Units Cost(3) Fair Value Members' Equity
Debt Investments
Aerospace and defense
Applied Composites First lien senior L + 5.50% 12/21/2023 $ 34,470 $ 34,219 $ 33,961 12.0 %
Holdings, LLC (fka secured loan
AC&A Enterprises
Holdings, LLC)(8)
Applied Composites First lien senior L + 5.50% 12/21/2022 3,000 2,989 2,956 1.0 %
Holdings, LLC (fka secured revolving
AC&A Enterprises loan
Holdings, LLC )(8)(14)
Bleriot US Bidco First lien senior L + 4.00% 10/30/2026 24,627 24,522 24,585 8.7 %
Inc.(8)(10) secured loan
Dynasty Acquisition First lien senior L + 3.50%
39,100 38,976 36,796 13.0 %
Co., Inc. (dba secured loan
StandardAero
Limited)(8)
101,197 100,706 98,298 34.7 %
Automotive
Holley, Inc.(8)(10) First lien senior L + 3.75%
17,100 17,016 17,032 6.0 %
secured loan
Holley, First lien senior L + 3.75% 5/18/2022 855 855 844 0.3 %
Inc.(8)(10)(11)(13) secured delayed
draw term loan
PAI Holdco, First lien senior L + 3.75% 10/28/2027 4,987 4,975 4,975 1.9 %
Inc.(8)(10)(14) secured loan
22,942 22,846 22,851 8.2 %
Buildings and Real
estate
Wrench Group, LLC.(8) First lien senior L + 4.00% 4/30/2026 32,341 32,198 32,179 11.4 %
secured loan
Business Services
CoolSys, Inc.(8) First lien senior L + 4.75% 8/11/2028 16,955 16,793 16,785 5.9 %
secured loan
CoolSys, First lien senior L + 4.75% 8/11/2023 - (29 ) (30 ) - %
Inc.(11)(12)(13)(14) secured delayed
draw term loan
17,000 16,918 16,879 6.0 %
secured loan
LABL, Inc.(8) First lien senior L + 5.00% 10/29/2028 8,000 7,883 7,879 2.8 %
secured loan
Packers Holdings, First lien senior L + 3.25% 3/9/2028 9,951 9,808 9,879 3.5 %
LLC(9)(10) secured loan
109--------------------------------------------------------------------------------
ORCC Senior Loan Fund's Portfolio as of December 31, 2021
($ in thousands)
Amortized Percentage of
Company(1)(2)(4)(5) Investment Interest Maturity Date Par / Units Cost(3) Fair Value Members' Equity
Vistage First lien senior L + 4.00% 2/10/2025 29,922 29,807 29,919 10.6 %
International, secured loan
Inc.(8)
81,828 81,180 81,311 28.8 %
Chemicals
Aruba Investments First lien senior L + 4.00% 11/24/2027 998 998 998 0.4 %
Holdings LLC (dba secured loan
Angus Chemical
Company)(9)(14)
Containers and
Packaging
BW Holding, First lien senior L + 4.00% 12/14/2028 3,954 3,914 3,914 1.4 %
Inc.(8)(14) secured loan
BW Holding, First lien senior L + 4.00% 12/17/2023 - (5 ) (5 ) - %
Inc.(11)(12)(13)(14) secured delayed
draw term loan
Ring Container First lien senior L + 3.75% 8/12/2028 25,000 24,940 25,025 8.9 %
Technologies Group, secured loan
LLC (dba Ring
Container
Technologies)(6)(10)
Valcour Packaging, First lien senior L + 3.75% 10/4/2028 7,000 6,976 6,965 2.5 %
LLC(7) secured loan
35,954 35,825 35,899 12.8 %
Distribution
Dealer Tire, First lien senior L + 4.25% 12/12/2025 36,260 36,114 36,206 12.8 %
LLC(6)(10) secured loan
SRS Distribution, First lien senior L + 3.75% 6/2/2028 9,975 9,906 9,943 3.5 %
Inc.(9)(10) secured loan
46,235 46,020 46,149 16.3 %
Education
Spring Education First lien senior L + 4.25% 7/30/2025 33,862 33,805 33,003 11.7 %
Group, Inc. (fka SSH secured loan
Group Holdings,
Inc.)(8)
Food and beverage
Balrog Acquisition, First lien senior L + 4.00% 9/5/2028 25,000 24,749 24,938 8.8 %
Inc. (dba secured loan
Bakemark)(9)
Dessert Holdings(8) First lien senior L + 4.00% 6/9/2028 20,160 20,019 20,001 7.1 %
secured loan
Dessert First lien senior L + 4.00% 6/9/2023 - - (2 ) - %
Holdings(11)(12)(13) secured delayed
draw term loan
110--------------------------------------------------------------------------------
ORCC Senior Loan Fund's Portfolio as of December 31, 2021
($ in thousands)
Amortized Percentage of
Company(1)(2)(4)(5) Investment Interest Maturity Date Par / Units Cost(3) Fair Value Members' Equity
Sovos Brands First lien senior L + 3.75% 6/8/2028 20,724 20,676 20,693 7.3 %
Intermediate, secured loan
Inc.(8)(10)
65,884 65,444 65,630 23.2 %
Healthcare equipment
and services
Cadence, Inc.(6) First lien senior L + 5.00% 5/21/2025 26,714 26,363 26,195 9.3 %
secured loan
Cadence, First lien senior L + 5.00% 5/21/2024 2,055 2,004 1,912 0.7 %
Inc.(6)(11)(14) secured revolving
loan
Medline Borrower, First lien senior L + 3.25% 10/23/2028 25,000 24,882 24,990 8.9 %
LP(6)(10) secured loan
Packaging First lien senior L + 3.75% 11/30/2027 4,987 4,975 4,983 1.8 %
Coordinators Midco, secured loan
Inc.(8)(10)(14)
58,756 58,224 58,080 20.7 %
Healthcare providers
and services
Confluent Health, First lien senior L + 4.00% 11/30/2028 20,575 20,473 20,472 7.3 %
LLC(6) secured loan
Confluent Health, First lien senior L + 4.00% 11/30/2023 - (22 ) (22 ) - %
LLC(11)(12)(13)(14) secured delayed
draw term loan
Phoenix
27,500 27,363 27,489 9.7 % (dba secured loan
Parexel)(6)(10)(14)
Unified Women's First lien senior L + 4.25% 12/20/2027 19,950 19,857 19,863 7.0 %
Healthcare, LP(6) secured loan
68,025 67,671 67,802 24 %
Healthcare technology
VVC Holdings Corp. First lien senior L + 4.25% 2/11/2026 17,179 16,961 17,162 6.1 %
(dba Athenahealth, secured loan
Inc.)(8)(10)
Infrastructure and
environmental
services
CHA Holding, Inc.(8) First lien senior L + 4.50% 4/10/2025 40,693 40,471 40,171 14.2 %
secured loan
Insurance
AmeriLife Holdings First lien senior L + 4.00% 3/18/2027 7,980 7,940 7,946 2.8 %
LLC(6)(10)(14) secured loan
111--------------------------------------------------------------------------------
ORCC Senior Loan Fund's Portfolio as of December 31, 2021
($ in thousands)
Amortized Percentage of
Company(1)(2)(4)(5) Investment Interest Maturity Date
Par / Units Cost(3) Fair Value
29,615 29,584 28,422 10.1 %
secured loan
Integro Parent First lien senior L + 4.50% 4/30/2022 6,000 6,000 5,764 2.0 %
Inc.(8)(11)(14) secured revolving
loan
43,595 43,524 42,132 14.9 %
Internet software and
services
DCert Buyer, Inc. (dba First lien senior L + 4.00% 10/16/2026 22,219 22,135 22,161 7.8 %
DigiCert)(6)(10) secured loan
Trader Interactive, First lien senior L + 4.00% 7/28/2028 25,000 24,886 24,875 8.8 %
LLC (fka Dominion Web secured loan
Solutions, LLC )(9)(14)
47,219 47,021 47,036 16.6 %
Manufacturing
35,000 34,834 34,864 12.3 % Holdings (dba secured loanDuravant )(8)(10) Pro Mach Group, First lien senior L + 4.00% 8/31/2028 22,207 22,100 22,262 7.9 % Inc.(8)(10) secured loan Pro Mach Group, First lien senior L + 4.00% 8/31/2023 - - - - % Inc.(10)(11)(13)(14) secured delayed draw term loan Gloves Buyer, Inc. First lien senior L + 4.00% 12/29/2027 7,500 7,463 7,463 2.6 % (dba Protective secured loan Industrial Products)(6)(14) 64,707 64,397 64,589 22.8 % Professional Services Apex Group Treasury, First lien senior L + 3.75% 7/27/2028 19,950 19,900 19,900 7.0 % LLC(8) secured loan Sovos Compliance, First lien senior L + 4.50% 8/11/2028 17,055 17,011 17,087 6.1 % LLC(6)(10) secured loan Sovos Compliance, First lien senior L + 4.50% 8/12/2023 - - - - % LLC(10)(11)(13) secured delayed draw term loan 37,005 36,911 36,987 13.1 % Total Debt Investments 798,420 794,202 790,277 279.9 % Total Investments$ 798,420 $ 794,202 $ 790,277 279.9 % ________________ (1) Certain portfolio company investments are subject to contractual restrictions on sales. (2) Unless otherwise indicated, ORCC SLF's investments are pledged as collateral supporting the amounts outstanding under ORCC SLF's credit facility. (3) The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method. (4) Unless otherwise indicated, all investments are considered Level 3 investments. (5) Unless otherwise indicated, loan contains a variable rate structure, and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate ("LIBOR" or "L") (which can include one-, two-, three- or six-month LIBOR) or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower's option, and which reset periodically based on the terms of the loan agreement. (6) The interest rate on these loans is subject to 1 month LIBOR, which as ofDecember 31, 2021 was 0.10%. (7) The interest rate on these loans is subject to 2 month LIBOR, which as ofDecember 31, 2021 was 0.15%. (8) The interest rate on these loans is subject to 3 month LIBOR, which as ofDecember 31, 2021 was 0.21%. (9) The interest rate on these loans is subject to 6 month LIBOR, which as ofDecember 31, 2021 was 0.34%. (10) Level 2 investment. (11) Position or portion thereof is an unfunded loan commitment. (12) The negative cost is the result of the capitalized discount being greater than the principal amount outstanding on the loan. The negative fair value is the result of the capitalized discount on the loan. (13) The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date. (14) Investment is not pledged as collateral under ORCC SLF's credit facility. 112 -------------------------------------------------------------------------------- ORCC Senior Loan Fund's
Portfolio as of
($ in thousands)
Amortized Percentage of
Company(1)(2)(4)(5) Investment Interest Maturity Date Par / Units Cost(3) Fair Value Members' Equity
Debt Investments
Aerospace and defense
Applied Composites First lien senior L + 5.25% 12/21/2023 $ 34,829 $ 34,455 $ 34,671 16.4 %
Holdings, LLC (fka AC&A secured loan
Enterprises Holdings ,
LLC)(7)
Applied Composites First lien senior L + 5.25% 12/21/2022 3,000 2,977 2,986 1.4 %
Holdings, LLC (fka AC&A secured revolving
Enterprises Holdings, loan
LLC)(7)(14)
Bleriot US Bidco First lien senior L + 4.75% 10/30/2026 14,888 14,762 14,827 6.9 %
Inc.(7)(10) secured loan
Dynasty Acquisition First lien senior L + 3.50% 4/4/2026 39,500 39,345 35,826 17.0 %
Co., Inc. (dba secured loan
StandardAero
Limited)(7)
92,217 91,539 88,310 41.7 %
Business Services
Vistage Worldwide, First lien senior L + 4.00% 2/10/2025 16,584 16,513 16,418 7.8 %
Inc.(7) secured loan
Distribution
Dealer Tire, LLC First lien senior L + 4.25% 12/12/2025 36,630 36,449 36,293 17.2 %
(6)(10) secured loan
Education34,212 34,140 32,456 15.4 % Inc. (fka SSH Group secured loanHoldings, Inc. )(7) Food and beverage DecoPac, Inc.(7) First lien senior L + 4.25% 9/30/2024 20,561 20,503 20,561 9.7 % secured loan DecoPac, First lien senior L + 4.25% 9/29/2023 - (8 ) (55 ) - % Inc.(11)(12)(14) secured revolving loan FQSR, LLC (dba KBP First lien senior L + 5.00% 5/15/2023 24,259 24,086 24,213 11.5 % Investments)(7) secured loan FQSR, LLC (dba KBP First lien senior L + 5.00% 9/10/2021 17,987 17,778 17,943 8.5 %
Investments)(8)(11)(13) secured delayed
draw term loan
Sovos Brands First lien senior L + 4.75% 11/20/2025 44,100 43,780 44,100 20.9 %
106,907 106,139 106,762 50.6 %
Healthcare equipment
and services
Cadence, Inc.(6) First lien senior L + 4.50% 5/21/2025 26,990 26,543 26,446 12.5 %
secured loan
Cadence, First lien senior P + 3.50% 5/21/2025 2,936 2,848 2,788 1.3 %
Inc.(9)(11)(14) secured revolving
loan
29,926 29,391 29,234 13.8 %
Healthcare technology
VVC Holdings Corp. (dba First lien senior L + 4.50% 2/11/2026 17,309 17,041 17,262 8.2 %
Athenahealth, secured loan
Inc.)(6)(10)
Infrastructure and
environmental services
CHA Holding, Inc.(7) First lien senior L + 4.50% 4/10/2025 41,145 40,861 40,857 19.4 %
secured loan
Insurance
30,055 29,987 30,014 14.2 %
secured loan
Integro Parent First lien senior L + 4.50% 4/30/2022 - (7 ) (28 ) - %
Inc.(11)(12)(14) secured revolving
loan
USRP Holdings, Inc. First lien senior L + 4.25% 3/29/2025 40,149 39,502 39,446 18.7 %
(dba U.S. Retirement secured loan
and Benefits
Partners)(8)
USRP Holdings, Inc. First lien senior L + 4.25% 3/29/2024 - (84 ) (131 ) (0.1 ) %
(dba U.S. Retirement secured revolving
and Benefits loan
Partners)(11)(12)(14)
70,204 69,398 69,301 32.8 %
113
--------------------------------------------------------------------------------
ORCC Senior Loan Fund's Portfolio as of
($ in thousands)
Amortized Percentage of
Company(1)(2)(4)(5) Investment Interest Maturity Date Par / Units Cost(3) Fair Value Members' Equity
Internet software and
services
DCert Buyer, Inc. First lien senior L + 4.00% 10/16/2026 49,625 49,466 49,511 23.5 %
(dba DigiCert)(6)(10) secured loan
Manufacturing
Engineered Machinery First lien senior L + 4.25% 7/19/2024 44,397 44,071 43,841 20.8 %
Holdings (dba secured loan
Duravant)(7)
Transportation
Uber Technologies, First lien senior L + 4.00% 4/4/2025 24,399 24,290 24,465 11.6 %
Inc.(6)(10) secured loan
Total Debt 563,555 559,298 554,710 262.8 %
Investments
Total Investments $ 563,555 $ 559,298 $ 554,710 262.8 %
________________
(1)
Certain portfolio company investments are subject to contractual restrictions on
sales.
(2)
Unless otherwise indicated, ORCC SLF's investments are pledged as collateral
supporting the amounts outstanding under ORCC SLF's credit facility.
(3)
The amortized cost represents the original cost adjusted for the amortization of
discounts and premiums, as applicable, on debt investments using the effective
interest method.
(4)
Unless otherwise indicated, all investments are considered Level 3 investments.
(5)
Unless otherwise indicated, loan contains a variable rate structure, which may
be subject to an interest rate floor. Variable rate loans bear interest at a
rate that may be determined by reference to either the London Interbank Offered
Rate ("LIBOR" or "L") (which can include one-, two-, three- or six-month LIBOR)
or an alternate base rate (which can include the Federal Funds Effective Rate or
the Prime Rate), at the borrower's option and which reset periodically based on
the terms of the loan agreement.
(6)
The interest rate on these loans is subject to 1 month LIBOR, which as of
December 31, 2020 was 0.14%.
(7)
The interest rate on these loans is subject to 3 month LIBOR, which as of
December 31, 2020 was 0.24%.
(8)
The interest rate on these loans is subject to 6 month LIBOR, which as of
December 31, 2020 was 0.26%.
(9)
The interest rate on these loans is subject to Prime, which as of December 31,
2020 was 3.25%.
(10)
Level 2 investment.
(11)
Position or portion thereof is an unfunded loan commitment.
(12)
The negative cost is the result of the capitalized discount being greater than
the principal amount outstanding on the loan. The negative fair value is the
result of the capitalized discount on the loan.
(13)
The date disclosed represents the commitment period of the unfunded term loan.
Upon expiration of the commitment period, the funded portion of the term loan
may be subject to a longer maturity date.
(14)
Investment is not pledged as collateral under ORCC SLF's credit facility.
114
--------------------------------------------------------------------------------
115
--------------------------------------------------------------------------------
Below is selected balance sheet information for ORCC SLF as of December 31, 2021
and December 31, 2020 :
($ in thousands) December 31, 2021 December 31, 2020
Assets
Investments at fair value (amortized cost of
$794,202 and $559,298 , respectively) $ 790,277 $ 554,710
Cash 60,723 9,385
Interest receivable 1,319 992
Prepaid expenses and other assets 111 237
Total Assets $ 852,430 $ 565,324
Liabilities
Debt (net of unamortized debt issuance costs of$5,368 and$2,415 , respectively) $ 469,514 $ 347,564 Distributions payable 4,518 4,694 Payable for investments purchased 91,986 - Accrued expenses and other liabilities 4,056 1,975 Total Liabilities $ 570,074 $ 354,233 Members' Equity Members' Equity 282,356 211,091 Members' Equity 282,356 211,091 Total Liabilities and Members' Equity $ 852,430 $ 565,324
Below is selected statement of operations information for ORCC SLF for the years
ended
For the Years Ended December 31,
($ in thousands) 2021 2020 2019
Investment Income
Interest income $ 30,836 $ 32,163 $ 38,841
Other income 344 281 348
Total Investment Income 31,180 32,444 39,189
Expenses
Interest expense 9,745 12,611 17,426
Professional fees 797 691 718
Total Expenses 10,542 13,302 18,144
Net Investment Income Before Taxes 20,638 19,142 21,045
Taxes 731 533 967
Net Investment Income After Taxes $ 19,907 $ 18,609 $ 20,078
Net Realized and Change in Unrealized
Gain (Loss) on Investments
Net change in unrealized gain (loss) on 663 (3,450 ) 7,423
investments
Net realized gain on investments 207 4 -
Total Net Realized and Change in 870 (3,446 ) 7,423
Unrealized Gain (Loss) on Investments
Net Increase in Members' Equity Resulting $ 20,777 $ 15,163 $ 27,501
from Operations
116-------------------------------------------------------------------------------- OnAugust 9, 2017 ,Sebago Lake Financing LLC andSL Lending LLC , wholly-owned subsidiaries of ORCC SLF, entered into a credit facility withGoldman Sachs Bank USA .Goldman Sachs Bank USA serves as the sole lead arranger, syndication agent and administrative agent, andState Street Bank and Trust Company serves as the collateral administrator and agent. The credit facility includes a maximum borrowing capacity of$500 million . OnJune 22, 2021 ,Sebago Lake Financing LLC andSL Lending LLC entered into an amendment withGoldman Sachs Bank USA to extend the reinvestment period on the credit facility toOctober 6, 2021 , and again onSeptember 20, 2021 , extended the reinvestment period on the credit facility toDecember 6, 2021 . As ofDecember 31, 2021 , there was$474.9 million outstanding under the credit facility. For the years endedDecember 31, 2021 , 2020 and 2019, the components of interest expense were as follows: For the Years Ended December 31, ($ in thousands) 2021 2020 2019 Interest expense$ 8,168 $ 10,962 $ 15,782 Amortization of debt issuance costs 1,577 1,649 1,644 Total Interest Expense$ 9,745 $ 12,611 $ 17,426 Average interest rate 2.3 % 3.1 % 4.7 % Average daily borrowings$ 359,501 $ 352,505 $ 337,491
Loan Origination and Structuring Fees
If the loan origination and structuring fees earned by ORCC SLF during a fiscal period exceed ORCC SLF's expenses and other obligations (excluding financing costs), such excess is allocated to the Member(s) responsible for the origination of the loans pro rata in accordance with the total loan origination and structuring fees earned by ORCC SLF with respect to the loans originated by such Member; provided, that in no event will the amount allocated to a Member exceed 1% of the par value of the loans originated by such Member in any fiscal year. The loan origination and structuring fee is accrued quarterly and included in other income from controlled, affiliated investments on our Consolidated Statements of Operations and paid annually. OnFebruary 27, 2019 , ORCC SLF's operating agreement was amended to eliminate the allocation of excess loan origination and structuring fees to the Members. As such, for the years endedDecember 31, 2021 , 2020 and 2019, we accrued no income based on loan origination and structuring fees. Results of Operations
The following table represents the operating results for the years ended
For the Years Ended December 31,
($ in millions) 2021 2020 2019
Total Investment Income $ 1,021.4 $ 803.3 $ 718.0
Less: Net operating expenses 527.3 283.8 217.1
Net Investment Income (Loss) $ 494.1 $ 519.5 $ 500.9
Before Taxes
Less: Income tax expense 4.0 2.0 2.0
(benefit), including excise tax
expense (benefit)
Net Investment Income (Loss) $ 490.1 $ 517.5 $ 498.9
After Taxes
Net change in unrealized gain 179.8 (76.0 ) (3.7 )
(loss)
Net realized gain (loss) (45.0 ) (53.8 ) 2.8
Net Increase (Decrease) in Net $ 624.9 $ 387.7
$ 498.0 Assets Resulting from Operations Net increase (decrease) in net assets resulting from operations can vary from period to period as a result of various factors, including the level of new investment commitments, expenses, the recognition of realized gains and losses and changes in unrealized appreciation and depreciation on the investment portfolio.
Investment Income
Investment income for the years endedDecember 31, 2021 , 2020 and 2019 were as follows: For the Years Ended December 31, ($ in millions) 2021 2020 2019
Interest income from investments $ 893.3 $ 732.6
$ 674.9 Payment-in-kind interest income 53.2 36.4 16.9 from investments Dividend Income from investments 48.4 19.5 10.0 Other income 26.5 14.8 16.1 Total investment income$ 1,021.4 $ 803.3$ 718.0 117
--------------------------------------------------------------------------------
For the years ended
Investment income increased to$1,021.4 million for the year endedDecember 31, 2021 from$803.3 million for the same period in prior year primarily due to an increase in our debt investment portfolio, which, at par, increased from$10.7 billion as ofDecember 31, 2020 to$11.9 billion as ofDecember 31, 2021 , partially offset by a decrease in our portfolio's weighted average yield from 7.9% as ofDecember 31, 2020 to 7.7% as ofDecember 31, 2021 . Included in investment income is dividend income which increased to$48.4 million from$19.5 million as ofDecember 31, 2021 and 2020, respectively, primarily due to an increase in dividends related to Windows Entities, ORCC SLF, and Wingspire. Also included in interest income are other fees such as prepayment fees and accelerated amortization of upfront fees from unscheduled paydowns. Period over period, income generated from these fees represented$63.9 million and$23.6 million , for the years endedDecember 31, 2021 and 2020, respectively. This change is due to an increase in unscheduled paydown activity year over year and while these fees are non-recurring in nature, we expect repayments to continue. For the year endedDecember 31, 2021 and 2020, payment-in-kind income represented 6.4% and less than 5.0% of investment income, respectively. Other income increased period-over-period due to an increase in incremental fee income, which are fees that are generally available to us as a result of closing investments and normally paid at the time of closing. We expect that investment income will vary based on a variety of factors including the pace of our originations and repayments.
For the years ended
Investment income increased to$803.3 million for the year endedDecember 31, 2020 from$718.0 million for the same period in prior year primarily due to an increase in our investment portfolio, which, at par, increased from$8.9 billion as ofDecember 31, 2019 , to$10.7 billion as ofDecember 31, 2020 , partially offset by a decrease in our portfolio's weighted average yield from 8.6% as ofDecember 31, 2019 to 8.0% as ofDecember 31, 2020 . Included in interest income are other fees such as prepayment fees and accelerated amortization of upfront fees from unscheduled paydowns. Period over period, income generated from these fees represented$23.6 million and$21.1 million , for the years endedDecember 31, 2020 and 2019, respectively. In addition to the growth in the portfolio, the incremental increase in investment income was primarily due to an increase in dividend income earned from our investment inMoore Holdings, LLC of$10.2 million , that was not earned in 2019, partially offset by a decrease in dividend income from Sebago Lake of$0.9 million period over period. Other income decreased period-over-period due to a decrease in incremental fee income, which are fees that are generally available to us as a result of closing investments and normally paid at the time of closing. For the year endedDecember 31, 2020 , the increase in investment income was partially driven by increased origination activity as a result of significant merger activity which has since leveled off. We expect that investment income will vary based on a variety of factors including the pace of our originations and repayments.
Expenses
Expenses for the years endedDecember 31, 2021 , 2020 and 2019 were as follows: For the Years Ended December 31, ($ in millions) 2021 2020 2019 Interest expense$ 219.1 $ 152.9 $ 136.5 Management fee 178.5 144.5 89.9 Performance based incentive fees 104.0 93.9 45.1 Professional fees 15.1 14.7 10.0 Directors' fees 1.0 0.8 0.6 Other general and administrative 9.6 7.9
8.4
Total operating expenses$ 527.3 $ 414.7 $
290.5
Management and incentive fees waived - (130.9 ) (73.4 ) Net operating expenses$ 527.3 $ 283.8 $ 217.1 Under the terms of the Administration Agreement, we reimburse the Adviser for services performed for us. In addition, pursuant to the terms of the Administration Agreement, the Adviser may delegate its obligations under the Administration Agreement to an affiliate or to a third party and we reimburse the Adviser for any services performed for us by such affiliate or third party. 118 --------------------------------------------------------------------------------
For the years ended
Total expenses increased to$527.3 million for the year endedDecember 31, 2020 from$283.8 million for the same period in the prior year primarily due to an increase in interest expense and increase in gross management fees and incentive fees, coupled with the expiration of the management fee and incentive fee waivers inOctober 2020 . The increase in interest expense of$66.2 million was driven by an increase in average daily borrowings to$6.3 billion from$3.8 billion period over period, partially offset by a decrease in the average interest rate to 3.0% from 3.5% period over period and includes approximately$2.1 million of non-recurring interest expense related to the restructuring ofCLO II and SPV IV and the repayment of the 2023 Notes. As a percentage of total assets, professional fees, directors' fees and other general and administrative expenses remained relatively consistent period over period.
For the years ended
Total expenses increased to$283.8 million for the year endedDecember 31, 2020 from$217.1 million for the same period in the prior year primarily due to an increase in interest expense and increase in gross management fees and incentive fees, coupled with the expiration of the management fee and incentive fee waivers. The increase in interest expense of$16.4 million was driven by an increase in average daily borrowings to$3.8 billion from$2.6 billion period over period, partially offset by a decrease in the average interest rate to 3.5% from 4.8% period over period. Interest expense increased period over period, and we would expect it to continue to increase as we re-deploy leverage and our asset coverage ratio decreases. As ofDecember 31, 2019 , our asset coverage ratio was 293% compared to 206% as ofDecember 31, 2020 . Gross management fees and incentive fees increased primarily due to an increase in our investment portfolio, which at par, increased from$8.9 billion as ofDecember 31, 2019 , to$10.7 billion as ofDecember 31, 2020 , and were partially offset by the management and incentive fee waivers, which expiredOctober 18, 2020 .
Selected Quarterly Financial Data (Unaudited)
For the three months ended
(amounts in thousands,
except share and per share September 30,
data) March 31, 2021 June 30, 2021 2021 December 31, 2021
Investment income $ 221,573 $ 249,015 $ 269,191 $ 281,624
Net expenses $ 118,918 $ 129,886 $ 138,692 $ 143,770
Net investment income $ 102,655 $ 119,129 $ 130,499 $ 137,854
(loss)
Net realized and unrealized $ 55,190
12,352 $ 36,152
gains (losses)
Increase (decrease) in net $ 157,845 $ 150,180 $ 142,851 $ 174,006
assets resulting from
operations
Net asset value per share $ 14.82 $ 14.90 $ 14.95 $ 15.08
as of the end of the
quarter
Earnings (losses) per share $ 0.40 $ 0.38 $ 0.36 $ 0.44
- basic and diluted
For the three months ended
(amounts in thousands,
except share and per share September 30,
data) March 31, 2020 June 30, 2020 2020 December 31, 2020
Investment income $ 204,732 $ 190,242 $ 187,059 $ 221,254
Net expenses $ 58,476 $ 61,080 $ 59,622 $ 106,653
Net investment income $ 146,256 $ 129,162 $ 127,437 $ 114,601
(loss)
Net realized and unrealized
88,610 $ 66,063
gains (losses)
Increase (decrease) in net $ (312,590 ) $ 303,619 $ 216,047 $ 180,664
assets resulting from
operations
Net asset value per share $ 14.09 $ 14.52 $ 14.67 $ 14.74
as of the end of the
quarter
Earnings (losses) per share $ (0.79 ) $ 0.79 $ 0.56 $ 0.46
- basic and diluted
119--------------------------------------------------------------------------------
For the three months ended
(amounts in thousands,
except share and per share September 30,
data) March 31, 2019 June 30, 2019 2019 December 31, 2019
Investment income $ 151,475 $ 176,135 $ 188,154 $ 202,255
Net expenses $ 55,470 $ 56,513 $ 50,248 $ 56,882
Net investment income $ 96,005 $ 119,622 $ 137,906 $ 145,373
(loss)Net realized and unrealized $ 18,482 $ 5,048 $
(19,254 ) $ (5,181 ) gains (losses) Increase (decrease) in net$ 114,487 $ 124,670 $ 118,652 $ 140,192 assets resulting from operations Net asset value per share $ 15.26 $ 15.28$ 15.22 $ 15.24 as of the end of the quarter Earnings (losses) per share $ 0.49 $ 0.44 $ 0.31 $ 0.36
- basic and diluted
Income Taxes, Including Excise Taxes
We have elected to be treated as a RIC under Subchapter M of the Code, and we intend to operate in a manner so as to continue to qualify for the tax treatment applicable to RICs. To qualify for tax treatment as a RIC, we must, among other things, distribute to our shareholders in each taxable year generally at least 90% of our investment company taxable income, as defined by the Code, and net tax-exempt income for that taxable year. To maintain our tax treatment as a RIC, we, among other things, intend to make the requisite distributions to our shareholders, which generally relieves us from corporate-levelU.S. federal income taxes. Depending on the level of taxable income earned in a tax year, we can be expected to carry forward taxable income (including net capital gains, if any) in excess of current year dividend distributions from the current tax year into the next tax year and pay a nondeductible 4%U.S. federal excise tax on such taxable income, as required. To the extent that we determine that our estimated current year annual taxable income will be in excess of estimated current year dividend distributions from such income, we will accrue excise tax on estimated excess taxable income. For the years endedDecember 31, 2021 , 2020 and 2019, we recordedU.S. federal and state income tax expense/(benefit) of$4.0 million ,$2.0 million and$2.0 million , respectively, includingU.S. federal excise tax expense/(benefit) of$21.6 thousand ,$(0.1) million and$2.0 million , respectively. Certain of our consolidated subsidiaries are subject toU.S. federal and state income taxes. For the years endedDecember 31, 2021 and 2020, we recorded a current tax expense of$4.0 million and$2.1 million , respectively. For the year endedDecember 31, 2019 , we did not record a current tax expense for taxable subsidiaries. The income tax expense for our taxable consolidated subsidiaries will vary depending on the level of investment income earnings and realized gains from the exits of investments held by such taxable subsidiaries during the respective periods. Net Unrealized Gains (Losses) We fair value our portfolio investments quarterly and any changes in fair value are recorded as unrealized gains or losses. During the years endedDecember 31, 2021 , 2020 and 2019, net unrealized gains (losses) were comprised of the following: For the Years Ended December 31, ($ in millions) 2021 2020 2019
Net change in unrealized gain $ 192.4 $ (76.9 )
$ (3.5 )
(loss) on investments
Income tax (provision) benefit (8.6 ) (3.7 ) -
Net change in translation of (4.0 ) 4.6 (0.2 )
assets and liabilities in
foreign currencies Net change in unrealized gain $ 179.8 $ (76.0 ) $ (3.7 ) (loss)
For the years ended
For the year endedDecember 31, 2021 , the net unrealized gain was primarily driven by an increase in the fair value of our debt investments as compared toDecember 31, 2020 . As ofDecember 31, 2021 , the fair value of our debt investments as a percentage of principal was 98.2% as compared to 97.3% as ofDecember 31, 2020 . The primary driver of our portfolio's net unrealized gain was due to the continued improvement of market conditions following the disruption seen in 2020 due to the COVID-19 pandemic. See "COVID-19 120 --------------------------------------------------------------------------------
Developments" for additional information. The ten largest contributors to the
change in net unrealized gain (loss) on investments during the year ended
Portfolio Company Net Change in Unrealized ($ in millions) Gain (Loss)Wingspire Capital Holdings LLC (1) $
44.1
Windows Entities
32.6
Aviation Solutions Midco, LLC (dbaSTS Aviation )
14.9
CIBT Global, Inc.
13.9
Innovative Water Care Global Corporation
9.5
ABB/Con-cise Optical Group LLC
9.1
Entertainment Benefits Group, LLC
6.6
Blackhawk Network Holdings, Inc.
6.5
PS Operating Company LLC (fkaQC Supply, LLC )(1)
6.1
Remaining Portfolio Companies 64.6 Norvax, LLC (dba GoHealth) (15.5 ) Total $ 192.4 ________________ (1)
Portfolio company is a controlled, affiliated investment
For the years ended
For the year endedDecember 31, 2020 , the net unrealized loss was primarily driven by a decrease in the fair value of our debt investments as compared toDecember 31, 2019 . As ofDecember 31, 2020 , the fair value of our debt investments as a percentage of principal was 97.3% as compared to 98.0% as ofDecember 31, 2019 . The primary driver of our portfolio's net unrealized loss was due to current market conditions and credit spreads widening, the impact of which was primarily seen in the first quarter of 2020, but which has subsequently improved in the second, third and fourth quarters as the average fair value of the portfolio has improved. See "COVID-19 Developments" for additional information. The ten largest contributors to the change in net unrealized gain (loss) on investments during the year endedDecember 31, 2020 consisted of the following: Portfolio Company Net Change in Unrealized ($ in millions) Gain (Loss) Norvax, LLC (dba GoHealth) $ 16.9 Windows Entities 14.0 Feradyne Outdoors, LLC 11.4 Remaining portfolio companies (25.6 ) Aviation Solutions Midco, LLC (dba STS Aviation) (25.3 ) CIBT Global, Inc. (25.3 ) LineStar Integrity Services LLC (10.0 ) Entertainment Benefits Group, LLC (9.9 )Valence Surface Technologies LLC
(9.7 )
(6.9 )
Blackhawk Network Holdings, Inc. (6.5 )
Total $ (76.9 )
Net Realized Gains (Losses)
The realized gains and losses on fully exited and partially exited portfolio companies during the years endedDecember 31, 2021 , 2020 and 2019 were comprised of the following: For the Years Ended December 31, ($ in millions) 2021 2020 2019 Net realized gain (loss) on investments $ (46.3 ) $ (51.4 ) $ 2.6 Net realized gain (loss) on 1.3 (2.4 ) 0.2 foreign currency transactions Net realized gain (loss) $ (45.0 ) $ (53.8 ) $ 2.8
Realized Gross Internal Rate of Return
Since we began investing in 2016 throughDecember 31, 2021 , our exited investments have resulted in an aggregate cash flow realized gross internal rate of return to us of over 10.3% (based on total capital invested of$6.2 billion and total proceeds from these 121 --------------------------------------------------------------------------------
exited investments of
IRR, is a measure of our discounted cash flows (inflows and outflows). Specifically, IRR is the discount rate at which the net present value of all cash flows is equal to zero. That is, IRR is the discount rate at which the present value of total capital invested in each of our investments is equal to the present value of all realized returns from that investment. Our IRR calculations are unaudited. Capital invested, with respect to an investment, represents the aggregate cost basis allocable to the realized or unrealized portion of the investment, net of any upfront fees paid at closing for the term loan portion of the investment. Realized returns, with respect to an investment, represents the total cash received with respect to each investment, including all amortization payments, interest, dividends, prepayment fees, upfront fees (except upfront fees paid at closing for the term loan portion of an investment), administrative fees, agent fees, amendment fees, accrued interest, and other fees and proceeds. Gross IRR, with respect to an investment, is calculated based on the dates that we invested capital and dates we received distributions, regardless of when we made distributions to our shareholders. Initial investments are assumed to occur at time zero. Gross IRR reflects historical results relating to our past performance and is not necessarily indicative of our future results. In addition, gross IRR does not reflect the effect of management fees, expenses, incentive fees or taxes borne, or to be borne, by us or our shareholders, and would be lower if it did. Aggregate cash flow realized gross IRR on our exited investments reflects only invested and realized cash amounts as described above, and does not reflect any unrealized gains or losses in our portfolio.
Financial Condition, Liquidity and Capital Resources
Our liquidity and capital resources are generated primarily from cash flows from interest, dividends and fees earned from our investments and principal repayments, our credit facilities, debt securitization transactions, and other secured and unsecured debt. We may also generate cash flow from operations, future borrowings and future offerings of securities including public and/or private issuances of debt and/or equity securities through both registered offerings off of our shelf registration statement and private offerings. The primary uses of our cash are (i) investments in portfolio companies and other investments and to comply with certain portfolio diversification requirements, (ii) the cost of operations (including paying or reimbursing our Adviser), (iii) debt service, repayment and other financing costs of any borrowings and (iv) cash distributions to the holders of our shares. We may from time to time enter into additional debt facilities, increase the size of our existing credit facilities, enter into additional debt securitization transactions, or issue additional debt securities. 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 1940 Act, with certain limited exceptions, we are only allowed to incur borrowings, issue debt securities or issue preferred stock, if immediately after the borrowing or issuance, the ratio of total assets (less total liabilities other than indebtedness) to total indebtedness plus preferred stock, is at least 150%. Our current target ratio is 0.90x-1.25x. As ofDecember 31, 2021 andDecember 31, 2020 , our asset coverage ratio was 182% and 206%, respectively. We seek to carefully consider our unfunded commitments for the purpose of planning our ongoing financial leverage. Further, we maintain sufficient borrowing capacity within the 150% asset coverage limitation to cover any outstanding unfunded commitments we are required to fund. Cash and restricted cash as ofDecember 31, 2021 , taken together with our available debt, is expected to be sufficient for our investing activities and to conduct our operations in the near term. As ofDecember 31, 2021 , we had$1.4 billion available under our credit facilities. Our long-term cash needs will include principal payments on outstanding indebtedness and funding of additional portfolio investments. Funding for long-term cash needs will come from unused net proceeds from financing activities. We believe that our liquidity and sources of capital are adequate to satisfy our short and long-term cash requirements. We cannot, however, be certain that these sources of funds will be available at a time and upon terms acceptable to us in sufficient amounts in the future. As ofDecember 31, 2021 , we had$447.1 million in cash and restricted cash. During the year endedDecember 31, 2021 , we used$1.2 billion in cash for operating activities, primarily as a result of funding portfolio investments of$7.1 billion , partially offset by sell downs and repayments of$5.5 billion and other operating activity of$0.4 billion . Lastly, cash provided by financing activities was$1.3 billion during the period, which was the result of net borrowings on our credit facilities of$1.8 billion , partially offset by distributions paid of$0.5 billion .
Equity
Equity Issuances, IPO, Subscriptions and Drawdowns
The Company has the authority to issue 500,000,000 common shares at
On
122
--------------------------------------------------------------------------------
On July 22, 2019 , the Company closed its initial public offering ("IPO"),
issuing 10 million shares of its common stock at a public offering price of
$15.30 per share, and on August 2, 2019 , the underwriters exercised their option
to purchase an additional 1.5 million shares of common stock at a purchase price
of $15.30 per share. Net of underwriting fees and offering costs, the Company
received total cash proceeds of $164.0 million . The Company's common stock began
trading on the New York Stock Exchange ("NYSE") under the symbol "ORCC" on July
18, 2019 .
On July 7, 2019 , the Board of Directors determined to eliminate outstanding
fractional shares of the Company's common stock, as permitted by Maryland
General Corporation Law. On July 8, 2019 , the Company eliminated the fractional
shares by rounding down the number of fractional shares held by each shareholder
to the nearest whole share and paying each shareholder cash for such fractional
shares based on a price of $15.27 per share.
Prior to March 2, 2018 , the Company entered into subscription agreements (the
"Subscription Agreements") with investors providing for the private placement of
the Company's common shares. Under the terms of the Subscription Agreements,
investors were required to fund drawdowns to purchase the Company's common
shares up to the amount of their respective Capital Commitment on an as-needed
basis each time the Company delivered a drawdown notice to its investors. As of
June 17, 2019 , all outstanding Capital Commitments had been drawn.
There were no sales of our common stock during the years ended
During the year endedDecember 31, 2019 , we delivered the following capital call notices to our investors: Aggregate Common Share Number of Common Offering Price Capital Drawdown Notice Date Issuance Date Shares Issued ($ in millions) June 4, 2019 June 17, 2019 103,504,284$ 1,580.5 March 21, 19,267,823 March 8, 2019 2019 300.0 February 12, 29,220,780 January 30, 2019 2019 450.0 Total 151,992,887$ 2,330.5 Distributions
The following table reflects the distributions declared on shares of our common
stock during the year ended
December 31, 2021
Date Declared Record Date Payment Date Distribution per Share
November 2, 2021 December 31, 2021 January 31, 2022 $ 0.31
August 3, 2021 September 30, 2021 November 15, 2021 $ 0.31
May 5, 2021 June 30, 2021 August 13, 2021 $ 0.31
February 23, 2021 March 31, 2021 May 14, 2021 $ 0.31
On
During certain periods, our distributions may exceed our earnings. As a result, it is possible that a portion of the distributions we make may represent a return of capital. A return of capital generally is a return of a shareholder's investment rather than a return of earnings or gains derived from our investment activities. Each year, a statement on Form 1099-DIV identifying the tax character of the distributions will be mailed to our shareholders. No portion of the distributions paid during the years endedDecember 31, 2021 , 2020 or 2019 represented a return of capital.
The following table reflects the distributions declared on shares of our common
stock during the year ended
December 31, 2020
Distribution per
Date Declared Record Date Payment Date Share
November 3, 2020 December 31, 2020 January 19, 2020 $ 0.31$ 0.08 August 4, 2020 September 30, 2020 November 13, 2020 $ 0.31
$ 0.08 May 5, 2020 June 30, 2020 August 14, 2020 $ 0.31
$ 0.08 February 19, 2020 March 31, 2020 May 15, 2020 $ 0.31
$ 0.08
The following table reflects the distributions declared on shares of our common
stock during the year ended
123
--------------------------------------------------------------------------------
December 31, 2019
Distribution per
Date Declared Record Date Payment Date Share
October 30, 2019 December 31, 2019 January 31, 2020 $ 0.31$ 0.04 May 28, 2019 September 30, 2019 November 15, 2019 $ 0.31
$ 0.02 June 4, 2019 June 14, 2019 August 15, 2019 $ 0.44 February 27, 2019 March 31, 2019 May 14, 2019 $ 0.33 Dividend Reinvestment Pursuant to our second amended and restated dividend reinvestment plan, we will reinvest all cash distributions declared by the Board on behalf of our shareholderswho do not elect to receive their distribution in cash as provided below. As a result, if the Board authorizes, and we declare, a cash dividend or other distribution, then our shareholderswho have not opted out of our dividend reinvestment plan will have their cash distributions automatically reinvested in additional shares of our common stock as described below, rather than receiving the cash dividend or other distribution. Any fractional share otherwise issuable to a participant in the dividend reinvestment plan will instead be paid in cash. If newly issued shares are used to implement the dividend reinvestment plan, the number of shares to be issued to a shareholder will be determined by dividing the total dollar amount of the cash dividend or distribution payable to a shareholder by the market price per share of our common stock at the close of regular trading on theNew York Stock Exchange on the payment date of a distribution, or if no sale is reported for such day, the average of the reported bid and ask prices. However, if the market price per share on the payment date of a cash dividend or distribution exceeds the most recently computed net asset value per share, we will issue shares at the greater of (i) the most recently computed net asset value per share and (ii) 95% of the current market price per share (or such lesser discount to the current market price per share that still exceeded the most recently computed net asset value per share). For example, if the most recently computed net asset value per share is$15.00 and the market price on the payment date of a cash dividend is$16.00 per share, we will issue shares at$15.20 per share (95% of the current market price). If the most recently computed net asset value per share is$15.00 and the market price on the payment date of a cash dividend is$15.50 per share, we will issue shares at$15.00 per share, as net asset value is greater than 95% ($14.73 per share) of the current market price. Pursuant to our second amended and restated dividend reinvestment plan, if shares are purchased in the open market to implement the dividend reinvestment plan, the number of shares to be issued to a shareholder shall be determined by dividing the dollar amount of the cash dividend payable to such shareholder by the weighted average price per share for all shares purchased by the plan administrator in the open market in connection with the dividend. Shareholderswho receive distributions in the form of shares of common stock will be subject to the sameU.S. federal, state and local tax consequences as if they received cash distributions.
The following table reflects the common stock issued pursuant to the dividend
reinvestment plan during the year ended
Date Declared Record Date Payment Date Shares
June 30, 2021 August 13, 2021 935,064
The following table reflects the common stock issued pursuant to the dividend
reinvestment plan during the year ended
Date Declared Record Date Payment Date Shares
June 30, 2020 August 14, 2020 3,541,285
The following table reflects the common stock issued pursuant to the dividend
reinvestment plan during the year ended
Date Declared Record Date Payment Date Shares
May 28, 2019 September 30, 2019 November 15, 2019 2,974,103
June 4, 2019 June 14, 2019 August 15, 2019 3,965,754
February 27, 2019 March 31, 2019 May 14, 2019 2,882,297
November 6, 2018 December 31, 2018 January 31, 2019 2,613,223
124--------------------------------------------------------------------------------
Stock Repurchase Plans
OnJuly 7, 2019 , our Board approved a stock repurchase plan (the "Company 10b5-1 Plan"), to acquire up to$150 million in the aggregate of our common stock at prices below our net asset value per share over a specified period, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the Exchange Act. The Company 10b5-1 Plan commenced onAugust 19, 2019 and was exhausted onAugust 4, 2020 . The following table provides information regarding purchases of our common stock byGoldman, Sachs & Co. , as agent, pursuant to the 10b5-1 plan for each month in the year endedDecember 31, 2020 : Approximate Approximate Dollar Value of Dollar Value Shares that of Shares that Period Total Number have been May Yet Be
($ in millions, except share and of Shares Average Price Purchased Under Purchased Under per share amounts)
Repurchased Paid per Share the Plans the Plan
January 1, 2020 - January 31, - $ - $ - $ 150.0
2020
February 1, 2020 - February 29, 87,328$ 15.17 $ 1.4 $ 148.6
2020
46.6 $ 102.0
74.3 $ 27.7
May 1, 2020 - May 31, 2020 2,183,581 $ 12.76 $ 27.7 $ -
June 1, 2020 - June 30, 2020 - $ - $ - $ -
July 1, 2020 - July 31, 2020 - $ - $ - $ -
August 1, 2020 - August 31, 2020 - $ - $ - $ -
Total 12,515,624 $ 150.0
On November 3, 2020 , the Board approved a repurchase program (the "Repurchase
Plan") under which we may repurchase up to $100 million of our outstanding
common stock and on November 2, 2021 , the Board extended the Repurchase Plan.
Under the program, purchases may be made at management's discretion from time to
time in open-market transactions, in accordance with all applicable securities
laws and regulations. Unless extended by the Board, the repurchase program will
terminate 12-months from the date it was approved. On November 2, 2021 , the
Board approved an extension to the Repurchase Plan and, unless further extended
by the Board, will terminate 12-months from that date. As of December 31, 2021 ,
Goldman, Sachs & Co. , as agent, has repurchased 186,150 shares of the Company's
common stock pursuant to the Repurchase Plan for approximately $2.6 million .
The following table provides information regarding purchases of our common stock
by
Approximate Approximate
Dollar Value of Dollar Value
Period Shares that have of Shares that
($ in millions, except Total Number been May Yet Be
share and per share of Shares Average Price Purchased Under Purchased Under
amounts) Repurchased Paid per Share the Plans the Plan
October 1, 2021 - October - $ - $ - $ 100.0
31, 2021
November 1, 2021 - November 22,900 $ 13.92 $ 0.3 $ 99.7
30, 2021
December 1, 2021 - December 163,250 $ 14.00 $ 2.3 $ 97.4
31, 2021
Total 186,150 $ 2.6
125--------------------------------------------------------------------------------
Debt Aggregate Borrowings Debt obligations consisted of the following as ofDecember 31, 2021 andDecember 31, 2020 : December 31, 2021 Aggregate Principal Outstanding Amount Net Carrying ($ in thousands) Committed Principal Available(1) Value(2) Revolving Credit Facility(3)(5)$ 1,655,000 $ 892,313 $ 707,370 $ 879,943 SPV Asset Facility II 350,000 100,000 250,000 95,668 SPV Asset Facility III 500,000 190,000 310,000 188,979 SPV Asset Facility IV 250,000 155,000 95,000 152,727 CLO I 390,000 390,000 - 386,989 CLO II 260,000 260,000 - 256,942 CLO III 260,000 260,000 - 257,937 CLO IV 292,500 292,500 - 287,342 CLO V 196,000 196,000 - 194,167 CLO VI 260,000 260,000 - 258,093 2024 Notes(4) 400,000 400,000 - 406,481 2025 Notes 425,000 425,000 - 419,674 July 2025 Notes 500,000 500,000 - 493,637 2026 Notes 500,000 500,000 - 491,085 July 2026 Notes 1,000,000 1,000,000 - 978,537 2027 Notes(4) 500,000 500,000 - 497,537 2028 Notes 850,000 850,000 - 833,588 Total Debt$ 8,588,500 $ 7,170,813 $ 1,362,370 $ 7,079,326 ________________ (1) The amount available reflects any collateral related limitations at the Company level related to each credit facility's borrowing base. (2) The carrying value of our Revolving Credit Facility, SPV Asset Facility II, SPV Asset Facility III, SPV Asset Facility IV, CLO I,CLO II ,CLO III ,CLO IV , CLO V, CLO VI, 2024 Notes, 2025 Notes,July 2025 Notes, 2026 Notes,July 2026 Notes, 2027 Notes and 2028 Notes are presented net of deferred financing costs of$12.4 million ,$4.3 million ,$1.0 million ,$2.2 million ,$3.0 million ,$3.1 million ,$2.1 million ,$5.2 million ,$1.8 million ,$1.9 million ,$5.0 million ,$5.3 million ,$6.4 million ,$8.9 million ,$21.5 million ,$9.7 million and$16.4 million respectively. (3) Includes the unrealized translation gain (loss) on borrowings denominated in foreign currencies. (4) Inclusive of change in fair market value of effective hedge. (5) The amount available is reduced by$55.3 million of outstanding letters of credit. 126 --------------------------------------------------------------------------------
December 31, 2020
Aggregate
Principal Outstanding Amount Net Carrying
($ in thousands) Committed Principal Available(1) Value(2)
Revolving Credit Facility(3)(5) $ 1,355,000 $ 252,525 $ 1,075,636 $ 243,143
SPV Asset Facility II 350,000 100,000 250,000 95,654
SPV Asset Facility III 500,000 375,000 125,000 373,238
SPV Asset Facility IV 450,000 295,000 155,000 291,644
CLO I 390,000 390,000 - 386,708
CLO II 260,000 260,000 - 257,686
CLO III 260,000 260,000 - 257,744
CLO IV 252,000 252,000 - 247,745
CLO V 196,000 196,000 - 194,128
2023 Notes(4) 150,000 150,000 - 151,889
2024 Notes(4) 400,000 400,000 - 418,372
2025 Notes 425,000 425,000 - 418,154
July 2025 Notes 500,000 500,000 - 492,095
2026 Notes 500,000 500,000 - 489,176
July 2026 Notes 1,000,000 1,000,000 - 975,346
Total Debt $ 6,988,000 $ 5,355,525 $ 1,605,636 $ 5,292,722
________________
(1)
The amount available reflects any limitations related to each credit facility's
borrowing base.
(2)
The carrying value of our Revolving Credit Facility, SPV Asset Facility II, SPV
Asset Facility III, SPV Asset Facility IV, CLO I, CLO II , CLO III , CLO IV , CLO
V, 2023 Notes, 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026
Notes are presented net of deferred financing costs of $9.4 million , $4.2
million , $1.8 million , $3.4 million , $3.3 million , $2.3 million , $2.3 million ,
$4.3 million , $1.9 million , $1.0 million , $7.0 million , $6.8 million , $7.9
million , $10.8 million , $24.7 million respectively.
(3)
Includes the unrealized translation gain (loss) on borrowings denominated in
foreign currencies.
(4)
Inclusive of change in fair market value of effective hedge.
(5)
The amount available is reduced by $26.8 million of outstanding letters of
credit.
For the years ended December 31, 2021 , 2020 and 2019, the components of interest
expense were as follows:
For the Years Ended December 31,
($ in thousands) 2021 2020 2019
Interest expense $ 192,652 $ 136,387 $ 125,311
Amortization of debt issuance 25,721 17,178 12,152
costs
Net change in unrealized gain 759 (626 ) (1,018 )
(loss) on effective
interest rate swaps and
hedged items(1)
Total Interest Expense $ 219,132 $ 152,939 $ 136,445
Average interest rate 3.0 % 3.5 % 4.8 %
Average daily borrowings $ 6,329,332 $ 3,815,270 $ 2,576,121
________________
(1)
Refer to "ITEM 8. - CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA -
Notes to Consolidated Financial Statements - Note 6. Debt - 2023 Notes, 2024
Notes and 2027 Notes" for details on each facility's interest rate swap.
Credit Facilities
Our credit facilities contain customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events, and customary events of default (with customary cure and notice provisions).
Revolving Credit Facility
OnFebruary 1, 2017 , we entered into a senior secured revolving credit agreement (and as amended by that certain First Amendment to Senior Secured Revolving Credit Agreement, dated as ofJuly 17, 2017 , the First Omnibus Amendment to Senior Secured Revolving Credit Agreement and Guarantee and Security Agreement, dated as ofMarch 29, 2018 , the Third Amendment to Senior Secured Revolving Credit Agreement, dated as ofJune 21, 2018 , the Fourth Amendment to Senior Secured Revolving Credit Agreement, dated as ofApril 2, 2019 , the Fifth Amendment to Senior Secured Revolving Credit Agreement, dated as ofMay 7, 2020 , the Sixth Amendment to Senior Secured Revolving Credit Agreement, dated as ofSeptember 3, 2020 and the Seventh Amendment to Senior Secured Revolving Credit Agreement, dated as ofSeptember 22, 2021 , the "Revolving Credit Facility"). The parties to the Revolving Credit Facility include 127 -------------------------------------------------------------------------------- us, as Borrower, the lenders from time to time parties thereto (each a "Lender" and collectively, the "Lenders"), the parties in their capacity as issuers of letters of credit (referred to as "Issuing Banks"), andTruist Securities, Inc. andING Capital LLC as Joint Lead Arrangers and Joint Book Runners,Truist Bank asAdministrative Agent andING Capital LLC as Syndication Agent. The Revolving Credit Facility is guaranteed byOR Lending LLC , our subsidiary, and will be guaranteed by certain domestic subsidiaries of ours that are formed or acquired by us in the future (collectively, the "Guarantors"). Proceeds of the Revolving Credit Facility may be used for general corporate purposes, including the funding of portfolio investments. The maximum principal amount of the Revolving Credit Facility is$1.655 billion , subject to availability under the borrowing base, which is based on our portfolio investments and other outstanding indebtedness. As amended onSeptember 22, 2021 , maximum capacity under the Revolving Credit Facility may be increased to$2.2 billion through our exercise of an uncommitted accordion feature through which existing and new lenders may, at their option, agree to provide additional financing. The Revolving Credit Facility includes a$50 million limit for swingline loans and is secured by a perfected first-priority interest in substantially all of the portfolio investments held by us and each Guarantor, subject to certain exceptions. The availability period under the Revolving Credit Facility will terminate onMarch 31, 2023 , with respect to$60 million of commitments,September 3, 2024 , with respect to$15 million of commitments (together, the "Non-Extending Commitments"), and onSeptember 22, 2025 , with respect to the remaining commitments (such remaining commitments, the "Extending Commitments") (together, the "Revolving Credit Facility Commitment Termination Date"). The Revolving Credit Facility will mature onApril 2, 2024 with respect to$60 million of commitments,September 3, 2025 , with respect to$15 million of commitments, and onSeptember 22, 2026 , with respect to the remaining commitments (together, the "Revolving Credit Facility Maturity Date"). During the period from the earliest Revolving Credit Facility Commitment Termination Date to the final Revolving Credit Facility Maturity Date, the Company will be obligated to make mandatory prepayments under the Revolving Credit Facility out of the proceeds of certain asset sales and other recovery events and equity and debt issuances. We borrow amounts inU.S. dollars or certain other permitted currencies. Amounts drawn under the Revolving Credit Facility with respect to the Extending Commitments will bear interest at either (i) LIBOR plus margin of either 1.875% per annum or, if the borrowing base is greater than or equal to the product of 1.60 and the combined debt amount, 1.75% per annum, (ii) an alternative base rate plus margin of either 0.875% per annum or, if the borrowing base is greater than or equal to the product of 1.60 and the combined debt amount, 0.75% per annum, or (iii) for amounts drawn under the Revolving Credit Facility in Sterling or Swiss Francs, either the Sterling Overnight Interbank Average Rate ("SONIA") or the Swiss Average Rate Overnight ("SARON"), as applicable, plus margin of either 1.875% per annum or, if the borrowing base is greater than or equal to the product of 1.60 and the combined debt amount, 1.75% per annum plus an applicable credit adjustment spread. Amounts drawn under the Revolving Credit Facility with respect to the Non-Extended Commitments will bear interest at either (i) LIBOR plus 2.00% per annum, (ii) an alternative base rate plus 1.00% per annum or (iii) SONIA or SARON, as applicable, plus 2.00% per annum plus an applicable credit adjustment spread. Further, the Revolving Credit Facility builds in a hardwired approach for the replacement of LIBOR loans inU.S. dollars. For LIBOR loans in other permitted currencies, the Revolving Credit Facility includes customary fallback mechanics for us and the Administrative Agent to select an alternative benchmark, subject to the negative consent of required Lenders. We may elect the currency and rate at the time of drawdown, and loans may be converted from one rate to another at any time at our option, subject to certain conditions. We predominantly borrow utilizing LIBOR rate loans, generally electing one-month upon borrowing, to the extent applicable. We also pay a fee of 0.375% on undrawn amounts under the Revolving Credit Facility. The Revolving Credit Facility includes customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events and certain financial covenants related to asset coverage and liquidity and other maintenance covenants, as well as customary events of default. The agreement requires a minimum asset coverage ratio of 100% with respect to our consolidated assets and our subsidiaries, measured at the last day of any fiscal quarter and a minimum asset coverage ratio of no less than 2.00 to 1.00 with respect to our consolidated assets and our subsidiary guarantors (including certain limitations on the contribution of equity in financing subsidiaries as specified therein) to our secured debt and our subsidiary guarantors (the "Obligor Asset Coverage Ratio"), measured at the last day of each fiscal quarter. The agreement concentration limits in connection with the calculation of the borrowing base, based upon the Obligor Asset Coverage Ratio.
Subscription Credit Facility
OnAugust 1, 2016 , we entered into a subscription credit facility (as amended, the "Subscription Credit Facility") withWells Fargo Bank, National Association ("Wells Fargo"), as administrative agent (the "Subscription Credit Facility Administrative Agent") and letter of credit issuer, and Wells Fargo,State Street Bank and Trust Company and the banks and financial institutions from time to time party thereto, as lenders. The Subscription Credit Facility permitted us to borrow up to$900 million , subject to availability under the borrowing base which is calculated based on the unused Capital Commitments of the investors meeting various eligibility requirements. EffectiveJune 19, 2019 , the outstanding balance of the Subscription Credit Facility was paid in full and the facility was terminated pursuant to its terms. Borrowings under the Subscription Credit Facility bore interest, at our election at the time of drawdown, at a rate per annum equal to (i) in the case of LIBOR rate loans, an adjusted LIBOR rate for the applicable interest period plus 1.60% or (ii) in the case of reference 128 -------------------------------------------------------------------------------- rate loans, the greatest of (A) a prime rate plus 0.60%, (B) the federal funds rate plus 1.10%, and (C) one-month LIBOR plus 1.60%. Loans may have been converted from one rate to another at any time at our election, subject to certain conditions. We predominantly borrowed utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. We paid an unused commitment fee of 0.25% per annum on the unused commitments.
SPV Asset Facilities
Certain of our wholly owned subsidiaries are parties to credit facilities (the "SPV Asset Facilities"). Pursuant to the SPV Asset Facilities, we sell and contribute certain investments to these wholly owned subsidiaries pursuant to sale and contribution agreements by and between us and the wholly owned subsidiaries. No gain or loss is recognized as a result of these contributions. Proceeds from the SPV Asset Facilities are used to finance the origination and acquisition of eligible assets by the wholly owned subsidiary, including the purchase of such assets from us. We retain a residual interest in assets contributed to or acquired to the wholly owned subsidiary through our ownership of the wholly owned subsidiary. The SPV Asset Facilities are secured by a perfected first priority security interest in the assets of these wholly owned subsidiaries and on any payments received by such wholly owned subsidiaries in respect of those assets. Assets pledged to lenders under the SPV Asset Facilities will not be available to pay our debts.
The SPV Asset Facilities contain customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events, and customary events of default (with customary cure and notice provisions).
SPV Asset Facility I
On December 21, 2017 (the "SPV Asset Facility I Closing Date"), ORCC Financing
LLC ("ORCC Financing"), a Delaware limited liability company and our subsidiary,
entered into a Loan and Servicing Agreement (as amended, the "SPV Asset Facility
I"), with ORCC Financing as Borrower, us as Transferor and Servicer, the lenders
from time to time parties thereto (the "SPV Lenders"), Morgan Stanley Asset
Funding Inc. as Administrative Agent, State Street Bank and Trust Company as
Collateral Agent and Cortland Capital Market Services LLC as Collateral
Custodian.
From time to time, we sold and contributed certain investments to ORCC Financing
pursuant to a Sale and Contribution Agreement by and between us and ORCC
Financing. No gain or loss was recognized as a result of the contribution.
Proceeds from the SPV Asset Facility I were used to finance the origination and
acquisition of eligible assets by ORCC Financing, including the purchase of such
assets from us. We retained a residual interest in assets contributed to or
acquired by ORCC Financing through its ownership of ORCC Financing. The maximum
principal amount of the SPV Asset Facility I was $400 million; the availability
of this amount was subject to a borrowing base test, which was based on the
value of ORCC Financing's assets from time to time, and satisfaction of certain
conditions, including certain concentration limits.
The SPV Asset Facility I provided for the ability to draw and redraw amounts
under the SPV Asset Facility I for a period of up to three years after the SPV
Asset Facility I Closing Date (the "SPV Asset Facility I Commitment Termination
Date"). The SPV Asset Facility I was terminated on June 2, 2020 (the "SPV Asset
Facility I Termination Date"). Prior to the SPV Asset Facility I Termination
Date, proceeds received by ORCC Financing from principal and interest,
dividends, or fees on assets must be used to pay fees, expenses and interest on
outstanding borrowings, and the excess may be returned to us, subject to certain
conditions. On the SPV Asset Facility I Termination Date, ORCC Financing repaid
in full all outstanding fees and expenses and all principal and interest on
outstanding borrowings.
Amounts drawn bore interest at LIBOR plus a spread of 2.25% until the six-month
anniversary of the SPV Asset Facility I Closing Date, increasing to 2.50%
thereafter, until the SPV Asset Facility I Commitment Termination Date. We
predominantly borrowed utilizing LIBOR rate loans, generally electing one-month
LIBOR upon borrowing. After a ramp-up period, there was an unused fee of 0.75%
per annum on the amount, if any, by which the undrawn amount under the SPV Asset
Facility I exceeded 25% of the maximum principal amount of the SPV Asset
Facility I. The SPV Asset Facility I contained customary covenants, including
certain financial maintenance covenants, limitations on the activities of ORCC
Financing, including limitations on incurrence of incremental indebtedness, and
customary events of default. The SPV Asset Facility I was secured by a perfected
first priority security interest in the assets of ORCC Financing and on any
payments received by ORCC Financing in respect of those assets. Assets pledged
to the SPV Lenders were not available to pay our debts.
SPV Asset Facility II
On May 22, 2018, our subsidiary, ORCC Financing II LLC ("ORCC Financing II"), a
Delaware limited liability company and our subsidiary, entered into a Credit
Agreement (as amended, the "SPV Asset Facility II"), with ORCC Financing II, as
Borrower, the lenders from time to time parties thereto, Natixis, New York
Branch, as Administrative Agent, State Street Bank and Trust Company , as
Collateral Agent, and Cortland Capital Market Services LLC as Document
Custodian. The parties to the SPV Asset Facility II have entered into various
amendments, including to admit new lenders, increase or decrease the maximum
principal amount available under the facility, extend the availability period
and maturity date, change the interest rate and make various other changes. The
following describes the terms of SPV Asset Facility II amended through July 8,
2021 (the "SPV Asset Facility II Sixth Amendment Date").
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From time to time, we sell and contribute certain investments to ORCC Financing
II pursuant to a sale and contribution agreement by and between us and ORCC
Financing II. No gain or loss will be recognized as a result of the
contribution. Proceeds from the SPV Asset Facility II will be used to finance
the origination and acquisition of eligible assets by ORCC Financing II,
including the purchase of such assets. The Company retains a residual interest
in assets contributed to or acquired by ORCC Financing II through the Company's
ownership of ORCC Financing II. The maximum principal amount of the SPV Asset
Facility II as of the SPV Asset Facility II Sixth Amendment Date is $350 million
(which includes terms loans of $100 million and revolving commitments of $250
million); the availability of this amount is subject to an overcollateralization
ratio test, which is based on the value of ORCC Financing II's assets from time
to time, and satisfaction of certain conditions, including an interest coverage
ratio test, certain concentration limits and collateral quality tests.
The SPV Asset Facility II provides for the ability to (1) draw term loans and
(2) draw and redraw revolving loans under the SPV Asset Facility II through
April 17, 2022, unless the revolving commitments are terminated or converted to
term loans sooner as provided in the SPV Asset Facility II (the "SPV Asset
Facility II Commitment Termination Date"). Unless otherwise terminated, the SPV
Asset Facility II will mature on December 22, 2028 (the "SPV Assert Facility II
Stated Maturity"). Prior to the SPV Asset Facility II Stated Maturity, proceeds
received by ORCC Financing II from principal and interest, dividends, or fees on
assets must be used to pay fees, expenses and interest on outstanding
borrowings, and the excess may be returned to us, subject to certain conditions.
On October 10, 2026, ORCC Financing II must pay in full all outstanding fees and
expenses and all principal and interest on outstanding borrowings, and the
excess may be returned to us.
With respect to revolving loans, amounts drawn bear interest at LIBOR (or, in
the case of certain lenders that are commercial paper conduits, the lower of
their cost of funds and LIBOR plus 0.25%) plus a spread that steps up from 2.20%
to 2.50% during the period from March 17, 2020, to the six month anniversary of
the Reinvestment Period End Date. With respect to term loans, amounts drawn bear
interest at LIBOR (or, in the case of certain lenders that are commercial paper
conduits, the lower of their cost of funds and LIBOR plus 0.25%) plus a spread
that steps up from 2.25% to 2.55% during the same period. We predominantly
borrow utilizing LIBOR rate loans, generally electing one-month LIBOR upon
borrowing. From March 17, 2020 to the SPV Asset Facility II Commitment
Termination Date, there is a commitment fee ranging from 0.50% to 0.625% per
annum on the undrawn amount, if any, of the revolving commitments in the SPV
Asset Facility II. For further details, see "ITEM 8. - Notes to Consolidated
Financial Statements - Note 6. Debt."
SPV Asset Facility III
On December 14, 2018, ORCC Financing III LLC ("ORCC Financing III"), a Delaware
limited liability company and our subsidiary, entered into a Loan Financing and
Servicing Agreement (the "SPV Asset Facility III"), with ORCC Financing III, as
borrower, ourselves, as equity holder and services provider, the lenders from
time to time parties thereto, Deutsche Bank AG, New York Branch, as Facility
Agent, State Street Bank and Trust Company , as Collateral Agent and Cortland
Capital Market Services LLC , as Collateral Custodian. The parties to the SPV
Asset Facility III have entered into various amendments, including those
relating to the undrawn fee and make-whole fee and definition of "Change of
Control." The following describes the terms of SPV Asset Facility III as amended
through December 13, 2021.
The maximum principal amount of the SPV Asset Facility III is $500 million; the
availability of this amount is subject to a borrowing base test, which is based
on the value of ORCC Financing III's assets from time to time, and satisfaction
of certain conditions, including interest spread and weighted average coupon
tests, certain concentration limits and collateral quality tests.
The SPV Asset Facility III provides for the ability to borrow, reborrow, repay
and prepay advances under the SPV Asset Facility III until June 14, 2022 unless
such period is extended or accelerated under the terms of the SPV Asset Facility
III (the "SPV Asset Facility III Revolving Period"). Unless otherwise extended,
accelerated or terminated under the terms of the SPV Asset Facility III, the SPV
Asset Facility III will mature on the date that is two years after the last day
of the SPV Asset Facility III Revolving Period (the "SPV Asset Facility III
Stated Maturity"). Prior to the SPV Asset Facility III Stated Maturity, proceeds
received by ORCC Financing III from principal and interest, dividends, or fees
on assets must be used to pay fees, expenses and interest on outstanding
advances, and the excess may be returned to us, subject to certain conditions.
On the SPV Asset Facility III Stated Maturity, ORCC Financing III must pay in
full all outstanding fees and expenses and all principal and interest on
outstanding advances, and the excess may be returned to us.
Amounts drawn bear interest at LIBOR (or, in the case of certain SPV Lenders III
that are commercial paper conduits, the lower of (a) their cost of funds and (b)
LIBOR, such LIBOR not to be lower than zero) plus a spread equal to 2.20% per
annum, which spread will increase (a) on and after the end of the SPV Asset
Facility III Revolving Period by 0.15% per annum if no event of default has
occurred and (b) by 2.00% per annum upon the occurrence of an event of default
(such spread, the "Applicable Margin"). LIBOR may be replaced as a base rate
under certain circumstances. We predominantly borrow utilizing LIBOR rate loans,
generally electing one-month LIBOR upon borrowing. During the Revolving Period,
ORCC Financing III will pay an undrawn fee ranging from 0.25% to 0.50% per annum
on the undrawn amount, if any, of the revolving commitments in the SPV Asset
Facility III. During the Revolving Period, if the undrawn commitments are in
excess of a certain portion (initially 20% and increasing in stages to 75%) of
the total commitments under the SPV Asset Facility III, ORCC Financing III will
also pay a make-whole fee equal to the Applicable Margin multiplied by such
excess undrawn commitment amount, reduced by the undrawn fee payable on such
excess. For further details, see "ITEM 8. - Notes to Consolidated Financial
Statements - Note 6. Debt."
SPV Asset Facility IV
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On August 2, 2019 (the "SPV Asset Facility IV Closing Date"), ORCC Financing IV
LLC ("ORCC Financing IV"), a Delaware limited liability company and newly formed
subsidiary, entered into a Credit Agreement (the "SPV Asset Facility IV"), with
ORCC Financing IV, as borrower, Société Générale, as initial Lender and as
Administrative Agent, State Street Bank and Trust Company , as Collateral Agent,
Collateral Administrator and Custodian, and Cortland Capital Market Services LLC
as Document Custodian and the lenders from time to time party thereto pursuant
to Assignment and Assumption Agreements.
On May 26, 2021 (the "SPV Asset Facility IV Amendment Date"), the parties to the
SPV Asset Facility IV amended the SPV Asset Facility IV to extend the
reinvestment period from August 2, 2021 until April 1, 2022 and to reduce the
total commitments from $450 million to $250 million.
From time to time, we expect to sell and contribute certain investments to ORCC
Financing IV pursuant to a Sale and Contribution Agreement by and between us and
ORCC Financing IV. No gain or loss will be recognized as a result of the
contribution. Proceeds from the SPV Asset Facility IV will be used to finance
the origination and acquisition of eligible assets by ORCC Financing IV,
including the purchase of such assets from us. We retain a residual interest in
assets contributed to or acquired by ORCC Financing IV through our ownership of
ORCC Financing IV. The maximum principal amount of the Credit Facility is
currently $250 million; the availability of this amount is subject to an
overcollateralization ratio test, which is based on the value of ORCC Financing
IV's assets from time to time, and satisfaction of certain conditions, including
an interest coverage ratio test, certain concentration limits and collateral
quality tests.
The SPV Asset Facility IV provides for the ability to (1) draw term loans and
(2) draw and redraw revolving loans under the SPV Asset Facility IV until the
last day of the reinvestment period unless the revolving commitments are
terminated or converted to term loans sooner as provided in the SPV Asset
Facility IV (the "Commitment Termination Date"). Unless otherwise terminated,
the SPV Asset Facility IV will mature on April 1, 2030 (the "SPV Asset Facility
IV Stated Maturity"). Prior to the SPV Asset Facility IV Stated Maturity,
proceeds received by ORCC Financing IV from principal and interest, dividends,
or fees on assets must be used to pay fees, expenses and interest on outstanding
borrowings, and the excess may be returned to us, subject to certain conditions.
On the SPV Asset Facility IV Stated Maturity, ORCC Financing IV must pay in full
all outstanding fees and expenses and all principal and interest on outstanding
borrowings, and the excess may be returned to us.
Amounts drawn bear interest at LIBOR (or, in the case of certain lenders that
are commercial paper conduits, the lower of their cost of funds and LIBOR plus
0.25%) plus a spread ranging from 2.15% to 2.40%. We predominantly borrow
utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing;
however, the SPV Asset Facility IV includes benchmark replacement provisions
which provide that the benchmark rate will transition to term SOFR on a
designated benchmark replacement date. From the Closing Date to the Commitment
Termination Date, there is a commitment fee ranging from 0.50% to 0.75% per
annum on the undrawn amount, if any, of the revolving commitments in the SPV
Asset Facility IV. The SPV Asset Facility IV contains customary covenants,
including certain financial maintenance covenants, limitations on the activities
of ORCC Financing IV, including limitations on incurrence of incremental
indebtedness, and customary events of default. The SPV Asset Facility IV is
secured by a perfected first priority security interest in the assets of ORCC
Financing IV and on any payments received by ORCC Financing IV in respect of
those assets. Assets pledged to the Lenders will not be available to pay our
debts. For further details, see "ITEM 8. - Notes to Consolidated Financial
Statements - Note 6. Debt."
CLOs
CLO I
On May 28, 2019 (the "CLO I Closing Date"), we completed a $596 million term
debt securitization transaction (the "CLO I Transaction"), also known as a
collateralized loan obligation transaction. The secured notes and preferred
shares issued in the CLO I Transaction and the secured loan borrowed in the CLO
I Transaction were issued and incurred, as applicable, by our consolidated
subsidiaries Owl Rock CLO I, Ltd., an exempted company incorporated in the
Cayman Islands with limited liability (the "CLO I Issuer"), and Owl Rock CLO I,
LLC, a Delaware limited liability company (the "CLO I Co-Issuer" and together
with the CLO I Issuer, the "CLO I Issuers") ") and are backed by a portfolio of
collateral obligations consisting of middle market loans and participation
interests in middle market loans as well as by other assets of the CLO I Issuer.
In the CLO I Transaction the CLO I Issuers (A) issued the following notes
pursuant to an indenture and security agreement dated as of the Closing Date
(the "CLO I Indenture"), by and among the CLO I Issuers and State Street Bank
and Trust Company : (i) $242 million of AAA (sf) Class A Notes, which bear
interest at three-month LIBOR plus 1.80%, (ii) $30 million of AAA (sf) Class A-F
Notes, which bear interest at a fixed rate of 4.165%, and (iii) $68 million of
AA(sf) Class B Notes , which bear interest at three-month LIBOR plus 2.70%
(together, the "CLO I Notes") and (B) borrowed $50 million under floating rate
loans (the "Class A Loans" and together with the CLO I Notes, the "CLO I Debt"),
which bear interest at three-month LIBOR plus 1.80%, under a credit agreement
(the "CLO I Credit Agreement"), dated as of the CLO I Closing Date, by and among
the CLO I Issuers, as borrowers, various financial institutions, as lenders, and
State Street Bank and Trust Company , as collateral trustee and loan agent. The
Class A Loans may be exchanged by the lenders for Class A Notes at any time,
subject to certain conditions under the CLO I Credit Agreement and the
Indenture. The CLO I Debt is scheduled to mature on May 20, 2031. The CLO I
Notes were privately placed by Natixis Securities Americas, LLC and SG Americas
Securities, LLC .
Concurrently with the issuance of the CLO I Notes and the borrowing under the Class A Loans, the CLO I Issuer issued approximately $206.1 million of subordinated securities in the form of 206,106 preferred shares at an issue price of U.S.$1,000 per share
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(the "CLO I Preferred Shares"). The CLO I Preferred Shares were issued by the
CLO I Issuer as part of its issued share capital and are not secured by the
collateral securing the CLO I Debt. We own all of the CLO I Preferred Shares,
and as such, are eliminated in consolidation. We act as retention holder in
connection with the CLO I Transaction for the purposes of satisfying certain
U.S. and European Union regulations requiring sponsors of securitization
transactions to retain exposure to the performance of the securitized assets and
as such is required to retain a portion of the CLO I Preferred Shares.
The Adviser serves as collateral manager for the CLO I Issuer under a collateral
management agreement dated as of the CLO I Closing Date. The Adviser is entitled
to receive fees for providing these services. The Adviser has waived its right
to receive such fees but may rescind such waiver at any time; provided, however,
that if the Adviser rescinds such waiver, the management fee payable to the
Adviser pursuant to the Investment Advisory Agreement will be offset by the
amount of the collateral management fee attributable to the CLO I Issuers'
equity or notes that we own.
The CLO I Debt is secured by all of the assets of the CLO I Issuer, which will
consist primarily of middle market loans, participation interests in middle
market loans, and related rights and the cash proceeds thereof. As part of the
CLO I Transaction, we and ORCC Financing II LLC sold and contributed
approximately $575 million par amount of middle market loans to the CLO I Issuer
on the CLO I Closing Date. Such loans constituted the initial portfolio assets
securing the CLO I Debt. We and ORCC Financing II LLC each made customary
representations, warranties, and covenants to the CLO I Issuer regarding such
sales and contributions under a loan sale agreement.
Through May 20, 2023, a portion of the proceeds received by the CLO I Issuer
from the loans securing the CLO I Debt may be used by the CLO I Issuer to
purchase additional middle market loans under the direction of the Adviser as
the collateral manager in the CLO I Transaction.
The CLO I Debt is the secured obligation of the CLO I Issuers, and the CLO I
Indenture and the CLO I Credit Agreement include customary covenants and events
of default. Assets pledged to holders of the Secured Debt and the other secured
parties under the Indenture will not be available to pay our debts.
The CLO I Notes were offered in reliance on Section 4(a)(2) of the Securities
Act. The CLO I Notes have not been registered under the Securities Act or any
state securities laws and, unless so registered, may not be offered or sold in
the United States absent registration with the Securities and Exchange
Commission or pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933, as amended (the
"Securities Act") as applicable. For further details, see "ITEM 8. - Notes to
Consolidated Financial Statements - Note 6. Debt."
On December 12, 2019 (the "CLO II Closing Date"), we completed a $396.6 million term debt securitization transaction (the "CLO II Transaction"), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by us. The secured notes and preferred shares issued in the CLO II Transaction were issued by our consolidated subsidiaries Owl Rock CLO II, Ltd., an exempted company incorporated in theCayman Islands with limited liability (the "CLO II Issuer"), and Owl Rock CLO II, LLC, aDelaware limited liability company (the "CLO II Co-Issuer" and together with the Issuer, the "CLO II Issuers") and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the Issuer. The CLO II Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the "CLO II Indenture"), by and among the Issuers andState Street Bank and Trust Company : (i) $157 million ofAAA (sf) Class A-1L Notes, which bear interest at three-month LIBOR plus 1.75%, (ii) $40 million ofAAA (sf) Class A-1F Notes, which bear interest at a fixed rate of 3.44%, (iii) $20 million ofAAA (sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.20%, (iv) $40 million of AA(sf) Class B-L Notes, which bear interest at three-month LIBOR plus 2.75% and (v) $3 million of AA(sf) Class B-F Notes, which bear interest at a fixed rate of 4.46% (together, the "CLO II Debt"). The CLO II Debt was scheduled to mature on January 20, 2031. The CLO II Debt was privately placed byDeutsche Bank Securities Inc.
The CLO II Debt was redeemed in the CLO II Refinancing, described below.
Concurrently with the issuance of the CLO II Debt, the CLO II Issuer issued approximately $136.6 million of subordinated securities in the form of 136,600 preferred shares at an issue price of U.S.$1,000 per share (the "CLO II Preferred Shares"). The CLO II Preferred Shares were issued by the CLO II Issuer as part of its issued share capital and are not secured by the collateral securing the CLO II Debt. We purchased all of the CLO II Preferred Shares. We acted as retention holder in connection with the CLO II Transaction for the purposes of satisfying certainU.S. andEuropean Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such was required to retain a portion of the CLO II Preferred Shares. The Adviser serves as collateral manager for the CLO II Issuer under a collateral management agreement dated as of the CLO II Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO II Issuers' equity or notes that we own. 132 -------------------------------------------------------------------------------- The CLO II Debt was secured by all of the assets of the CLO II Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO II Transaction, we and ORCC Financing III LLC sold and contributed approximately $400 million par amount of middle market loans to the CLO II Issuer on the CLO II Closing Date. Such loans constituted the initial portfolio assets securing the CLO II Debt. We and ORCC Financing III LLC each made customary representations, warranties, and covenants to the CLO II Issuer regarding such sales and contributions under a loan sale agreement. Through January 20, 2022, a portion of the proceeds received by the CLO II Issuer from the loans securing the CLO II Debt could be used by the CLO II Issuer to purchase additional middle market loans under the direction of the Adviser as collateral manager for the CLO II Issuer and in accordance with the our investing strategy and ability to originate eligible middle market loans. The CLO II Debt was the secured obligation of the CLO II Issuers, and the CLO II Indenture includes customary covenants and events of default. Assets pledged to holders of the Secured Debt and the other secured parties under the Indenture were not available to pay our debts. The CLO II Debt was offered in reliance on Section 4(a)(2) of the Securities Act. The CLO II Notes have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold inthe United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt." CLO II Refinancing On April 9, 2021 (the "CLO II Refinancing Date"), we completed a $398.1 million term debt securitization refinancing (the "CLO II Refinancing"), also known as a collateralized loan obligation refinancing, which is a form of secured financing incurred by us. The secured notes and preferred shares issued in the CLO II Refinancing were issued by the CLO II Issuer and the CLO II Co-Issuer and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO II Issuer. The CLO II Refinancing was executed by the issuance of the following classes of notes pursuant to the CLO II Indenture, as supplemented by the supplemental indenture dated as of the CLO II Refinancing Date (the "CLO II Refinancing Indenture"), by and among the CLO II Issuers andState Street Bank and Trust Company : (i) $204 million ofAAA (sf) Class A-LR Notes, which bear interest at three-month LIBOR plus 1.55%, (ii) $20 million ofAAA (sf) Class A-FR Notes, which bear interest at a fixed rate of 2.48% and (iii) $36 million of AA(sf) Class B-R Notes, which bear interest at three-month LIBOR plus 1.90% (together, the "CLO II Refinancing Debt"). The CLO II Refinancing Debt is secured by the middle market loans, participation interests in middle market loans and other assets of the CLO II Issuer. The CLO II Refinancing Debt is scheduled to mature on April 20, 2033. The CLO II Refinancing Debt was privately placed byDeutsche Bank Securities Inc. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO II Refinancing Debt. The proceeds from the CLO II Refinancing were used to redeem in full the classes of notes issued on the CLO II Closing Date. Concurrently with the issuance of the CLO II Refinancing Debt, the CLO II Issuer issued 1,500 additional shares of CLO II Preferred Shares at an issue price of U.S.$1,000 per share (the "CLO II Refinancing Preferred Shares") resulting in a total outstanding number of CLO II Preferred Shares of 138,100 ($138.1 million total issue price). The CLO II Refinancing Preferred Shares were issued by the CLO II Issuer as part of its issued share capital and are not secured by the collateral securing the CLO II Refinancing Debt. We purchased all of the CLO II Refinancing Preferred Shares. We act as retention holder in connection with the CLO II Refinancing for the purposes of satisfying certainU.S. andEuropean Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO II Preferred Shares. The proceeds from the CLO II Refinancing Preferred Shares were used to pay certain expenses incurred in connection with the CLO II Refinancing. Through April 20, 2025, a portion of the proceeds received by the CLO II Issuer from the loans securing the CLO II Refinancing Debt may be used by the CLO II Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO II Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans. The CLO II Refinancing Debt is the secured obligation of the CLO II Issuers, and the CLO II Refinancing Indenture includes customary covenants and events of default. The CLO II Refinancing Debt has not been registered under the Securities Act, or any state securities (e.g., "blue sky") laws, and may not be offered or sold inthe United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO II Issuers' equity or notes that we own. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt."CLO III 133
-------------------------------------------------------------------------------- On March 26, 2020 (the "CLO III Closing Date"), we completed a $395.31 million term debt securitization transaction (the "CLO III Transaction"), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by us. The secured notes and preferred shares issued in the CLO III Transaction were issued by our consolidated subsidiaries Owl Rock CLO III, Ltd., an exempted company incorporated in theCayman Islands with limited liability (the "CLO III Issuer"), and Owl Rock CLO III, LLC, aDelaware limited liability company (the "CLO III Co-Issuer" and together with the CLO III Issuer, the "CLO III Issuers") and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO III Issuer. The CLO III Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the CLO III Closing Date (the "CLO III Indenture"), by and among the CLO III Issuers andState Street Bank and Trust Company : (i) $166 million ofAAA (sf) Class A-1L Notes, which bear interest at three-month LIBOR plus 1.80%, (ii) $40 million ofAAA (sf) Class A-1F Notes, which bear interest at a fixed rate of 2.75%, (iii) $20 million ofAAA (sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.00%, and (iv) $34 million of AA(sf) ClassB Notes , which bear interest at three-month LIBOR plus 2.45% (together, the "CLO III Debt"). The CLO III Debt is scheduled to mature on April 20, 2032. The CLO III Debt was privately placed bySG Americas Securities, LLC . Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO III Debt. Concurrently with the issuance of the CLO III Debt, the CLO III Issuer issued approximately $135.31 million of subordinated securities in the form of 135,310 preferred shares at an issue price of U.S.$1,000 per share (the "CLO III Preferred Shares"). The CLO III Preferred Shares were issued by the CLO III Issuer as part of its issued share capital and are not secured by the collateral securing the CLO III Debt. We own all of the CLO III Preferred Shares, and as such, these securities are eliminated in consolidation. We act as retention holder in connection with the CLO III Transaction for the purposes of satisfying certainU.S. andEuropean Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO III Preferred Shares. The Adviser serves as collateral manager for the CLO III Issuer under a collateral management agreement dated as of the CLO III Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO III Issuers' equity or notes that we own. The CLO III Debt is secured by all of the assets of the CLO III Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO III Transaction, we and ORCC Financing IV LLC sold and contributed approximately $400 million par amount of middle market loans to the CLO III Issuer on the CLO III Closing Date. Such loans constituted the initial portfolio assets securing the CLO III Debt. Us and ORCC Financing IV LLC each made customary representations, warranties, and covenants to the CLO III Issuer regarding such sales and contributions under a loan sale agreement. Through April 20, 2024, a portion of the proceeds received by the CLO III Issuer from the loans securing the CLO III Debt may be used by the CLO III Issuer to purchase additional middle market loans under the direction of the Adviser as the collateral manager for the CLO III Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans. The CLO III Debt is the secured obligation of the CLO III Issuers, and the CLO III Indenture includes customary covenants and events of default. Assets pledged to holders of the CLO III Debt and the other secured parties under the CLO III Indenture will not be available to pay our debts. The CLO III Debt was offered in reliance on Section 4(a)(2) of the Securities Act. The CLO III Debt has not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold inthe United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt."CLO IV On May 28, 2020 (the "CLO IV Closing Date"), we completed a $438.9 million term debt securitization transaction (the "CLO IV Transaction"), also known as a collateralized loan obligation transaction, which is a form of secured financing. The secured notes and preferred shares issued in the CLO IV Transaction were issued by our consolidated subsidiaries Owl Rock CLO IV, Ltd., an exempted company incorporated in theCayman Islands with limited liability (the "CLO IV Issuer"), and Owl Rock CLO IV, LLC, aDelaware limited liability company (the "CLO IV Co-Issuer" and together with the CLO IV Issuer, the "CLO IV Issuers") and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO IV Issuer. The CLO IV Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the "CLO IV Indenture"), by and among the CLO IV Issuers andState Street Bank and Trust Company : (i) $236.5 million ofAAA (sf) Class A-1 Notes, which bear interest at three-month LIBOR plus 2.62% and (ii) $15.5 134 -------------------------------------------------------------------------------- million ofAAA (sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 3.40% (together, the "CLO IV Secured Notes"). The CLO IV Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO IV Issuer. The CLO IV Secured Notes are scheduled to mature on May 20, 2029. The CLO IV Secured Notes were privately placed byNatixis Securities Americas LLC .
The CLO IV Secured Notes were redeemed in the CLO IV Refinancing, described below.
Concurrently with the issuance of the CLO IV Secured Notes, the CLO IV Issuer issued approximately $186.9 million of subordinated securities in the form of 186,900 preferred shares at an issue price of U.S.$1,000 per share (the "CLO IV Preferred Shares"). The CLO IV Preferred Shares were issued by the CLO IV Issuer as part of its issued share capital and are not secured by the collateral securing the CLO IV Secured Notes. We own all of the outstandingCLO IV Preferred Shares, and as such, these securities are eliminated in consolidation. We acted as retention holder in connection with the CLO IV Transaction for the purposes of satisfying certainU.S. andEuropean Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such was required to retain a portion of the CLO IV Preferred Shares while the CLO IV Secured Notes were outstanding. As part of the CLO IV Transaction, we entered into a loan sale agreement with the CLO IV Issuer dated as of the CLO IV Closing Date, which provided for the sale and contribution of approximately $275.07 million par amount of middle market loans to the CLO IV Issuer on the CLO IV Closing Date and for future sales to the CLO IV Issuer on an ongoing basis. Such loans constituted part of the initial portfolio of assets securing the CLO IV Secured Notes. The remainder of the initial portfolio assets securing the CLO IV Secured Notes consisted of approximately $174.92 million par amount of middle market loans purchased by the CLO IV Issuer from ORCC Financing II LLC, our wholly-owned subsidiary, under an additional loan sale agreement executed on the CLO IV Closing Date between the Issuer and ORCC Financing II LLC. We and ORCC Financing II LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement. Through November 20, 2021, a portion of the proceeds received by the CLO IV Issuer from the loans securing the CLO IV Secured Notes could be used by the CLO IV Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO IV Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans. The CLO IV Secured Notes were the secured obligation of the CLO IV Issuers, and the CLO IV Indenture includes customary covenants and events of default. The CLO IV Secured Notes have not been registered under the Securities Act, or any state securities (e.g., "blue sky") laws, and may not be offered or sold inthe United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration. Assets pledged to the holders of the CLO IV Secured Notes were not available to pay our debts.
CLO IV Refinancing
On July 9, 2021 (the "CLO IV Refinancing Date"), the Company completed a $440.5 million term debt securitization refinancing (the "CLO IV Refinancing"), also known as a collateralized loan obligation refinancing, which is a form of secured financing. The secured notes and preferred shares issued in the CLO IV Refinancing were issued by the CLO IV Issuer and the CLO IV Co-Issuer and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO IV Issuer. The CLO IV Refinancing was executed by the issuance of the following classes of notes pursuant to the CLO IV Indenture as supplemented by the supplemental indenture dated as of the CLO IV Refinancing Date (the "CLO IV Refinancing Indenture"), by and among the CLO IV Issuers andState Street Bank and Trust Company : (i) $252 million ofAAA (sf) Class A-1-R Notes, which bear interest at three-month LIBOR plus 1.60% and (ii) $40.5 million of AA(sf) Class A-2-R Notes, which bear interest at a fixed rate of 1.90% (together, the "CLO IV Refinancing Secured Notes"). The CLO IV Refinancing Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the Issuer. The CLO IV Refinancing Secured Notes are scheduled to mature on August 20, 2033. The CLO IV Refinancing Secured Notes were privately placed byNatixis Securities Americas LLC . Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO IV Refinancing Secured Notes. The proceeds from the CLO IV Refinancing were used to redeem in full the classes of notes issued on the CLO IV Closing Date, to redeem a portion of the preferred shares of the CLO IV Issuer as described below and to pay expenses incurred in connection with the CLO IV Refinancing. Concurrently with the issuance of the CLO IV Refinancing Secured Notes, the CLO IV Issuer redeemed 38,900 preferred shares we held at a total redemption price of $38.9 million ($1,000 per preferred share). We retain the 148,000CLO IV Preferred Shares that remain outstanding and that we acquired on the CLO IV Closing Date. The CLO IV Preferred Shares were issued by the Issuer as part of its issued share capital and are not secured by the collateral securing the CLO IV Refinancing Secured Notes. We act as retention holder in connection with the CLO IV Refinancing for the purposes of satisfying certainU.S. andEuropean Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the Preferred Shares. Through August 20, 2025, a portion of the proceeds received by the CLO IV Issuer from the loans securing the CLO IV Refinancing Secured Notes may be used by the Issuer to purchase additional middle market loans under the direction of the Advisor, in its capacity as 135 --------------------------------------------------------------------------------
collateral manager for the CLO IV Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans.
The CLO IV Refinancing Secured Notes are the secured obligation of the CLO IV Issuers, and the CLO IV Refinancing Indenture includes customary covenants and events of default. The CLO IV Refinancing Secured Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities (e.g., "blue sky") laws, and may not be offered or sold inthe United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration. The Adviser serves as collateral manager for the CLO IV Issuer under a collateral management agreement dated as of the CLO IV Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO IV Issuers' equity or notes we own. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt."
CLO V
On November 20, 2020 (the "CLO V Closing Date"), we completed a $345.45 million term debt securitization transaction (the "CLO V Transaction"), also known as a collateralized loan obligation transaction, which is a form of secured financing. The secured notes and preferred shares issued in the CLO V Transaction were issued by our consolidated subsidiaries Owl Rock CLO V, Ltd., an exempted company incorporated in theCayman Islands with limited liability (the "CLO V Issuer"), and Owl Rock CLO V, LLC, aDelaware limited liability company (the "CLO V Co-Issuer" and together with the CLO V Issuer, the "CLO V Issuers") and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO V Issuer. The CLO V Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the "CLO V Indenture"), by and among the CLO V Issuers andState Street Bank and Trust Company : (i) $182 million ofAAA (sf)/AAAsf Class A-1 Notes, which bear interest at three-month LIBOR plus 1.85% and (ii) $14 million ofAAA (sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.20% (together, the "CLO V Secured Notes"). The CLO V Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO V Issuer. The CLO V Secured Notes are scheduled to mature on November 20, 2029. The CLO V Secured Notes were privately placed byNatixis Securities Americas LLC . Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO V Secured Notes. Concurrently with the issuance of the CLO V Secured Notes, the CLO V Issuer issued approximately $149.45 million of subordinated securities in the form of 149,450 preferred shares at an issue price of U.S.$1,000 per share (the "CLO V Preferred Shares"). The CLO V Preferred Shares were issued by the CLO V Issuer as part of its issued share capital and are not secured by the collateral securing the CLO V Secured Notes. We purchased all of the CLO V Preferred Shares, and as such, these securities are eliminated in consolidation. We act as retention holder in connection with the CLO V Transaction for the purposes of satisfying certainU.S. andEuropean Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO V Preferred Shares. As part of the CLO V Transaction, we entered into a loan sale agreement with the CLO V Issuer dated as of the CLO V Closing Date, which provided for the sale and contribution of approximately $201.75 million par amount of middle market loans to the CLO V Issuer on the CLO V Closing Date and for future sales to the CLO V Issuer on an ongoing basis. Such loans constituted part of the initial portfolio of assets securing the CLO V Secured Notes. The remainder of the initial portfolio assets securing the CLO V Secured Notes consisted of approximately $84.74 million par amount of middle market loans purchased by the CLO V Issuer from ORCC Financing II LLC, our wholly-owned subsidiary, under an additional loan sale agreement executed on the CLO V Closing Date between the Issuer and ORCC Financing II LLC. We and ORCC Financing II LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement. Through July 20, 2022, a portion of the proceeds received by the CLO V Issuer from the loans securing the CLO V Secured Notes may be used by the CLO V Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO V Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans. The Secured Notes are the secured obligation of the CLO V Issuers, and the CLO V Indenture includes customary covenants and events of default. The CLO V Secured Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities (e.g., "blue sky") laws, and may not be offered or sold inthe United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration. The Adviser will serve as collateral manager for the CLO V Issuer under a collateral management agreement dated as of the CLO V Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the 136 --------------------------------------------------------------------------------
CLO V Issuers' equity or notes that we own. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt."
CLO VI
On May 5, 2021 (the "CLO VI Closing Date"), we completed a $397.78 million term debt securitization transaction (the "CLO VI Transaction"), also known as a collateralized loan obligation transaction, which is a form of secured financing. The secured notes and preferred shares issued in the CLO VI Transaction were issued by our consolidated subsidiaries Owl Rock CLO VI, Ltd., an exempted company incorporated in theCayman Islands with limited liability (the "CLO VI Issuer"), and Owl Rock CLO VI, LLC, aDelaware limited liability company (the "CLO VI Co-Issuer" and together with the CLO VI Issuer, the "CLO VI Issuers") and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO VI Issuer. The CLO VI Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the "CLO VI Indenture"), by and among the CLO VI Issuers andState Street Bank and Trust Company : (i) $ 224 million ofAAA (sf) Class A Notes, which bear interest at three-month LIBOR plus 1.45%, (ii) $26 million of AA(sf) Class B-1 Notes, which bear interest at three-month LIBOR plus 1.75% and (iii) $10 million of AA(sf) Class B-F Notes, which bear interest at a fixed rate of 2.83% (together, the "CLO VI Secured Notes"). The CLO VI Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO VI Issuer. The CLO VI Secured Notes are scheduled to mature on June 21, 2032. The CLO VI Secured Notes are privately placed bySG Americas Securities, LLC . Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO VI Secured Notes. Concurrently with the issuance of the CLO VI Secured Notes, the CLO VI Issuer issued approximately $137.78 million of subordinated securities in the form of 137,775 preferred shares at an issue price of U.S.$1,000 per share (the "CLO VI Preferred Shares"). The CLO VI Preferred Shares were issued by the CLO VI Issuer as part of its issued share capital and are be secured by the collateral securing the CLO VI Secured Notes. We purchased all of the CLO VI Preferred Shares, and as such, these securities are eliminated in consolidation. We will act as retention holder in connection with the CLO VI Transaction for the purposes of satisfying certainU.S. ,United Kingdom andEuropean Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO VI Preferred Shares. As part of the CLO VI Transaction, we entered into a loan sale agreement with the CLO VI Issuer dated as of the CLO VI Closing Date, which provides for the sale and contribution of approximately $205.6 million par amount of middle market loans to the CLO VI Issuer on the CLO VI Closing Date and for future sales to the CLO VI Issuer on an ongoing basis. Such loans constitute part of the initial portfolio of assets securing the CLO VI Secured Notes. The remainder of the initial portfolio assets securing the CLO VI Secured Notes consists of approximately $164.7 million par amount of middle market loans purchased by the CLO VI Issuer from ORCC Financing IV LLC, our wholly-owned subsidiary, under an additional loan sale agreement executed on the CLO VI Closing Date between the Issuer and ORCC Financing IV LLC. We and ORCC Financing IV LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement. Through June 20, 2024, a portion of the proceeds received by the CLO VI Issuer from the loans securing the CLO VI Secured Notes may be used by the CLO VI Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO VI Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans. The Secured Notes are the secured obligation of the CLO VI Issuers, and the CLO VI Indenture includes customary covenants and events of default. The CLO VI Secured Notes have not been registered under the Securities Act of 1933, as amended (the "Securities Act"), or any state securities (e.g., "blue sky") laws, and may not be offered or sold inthe United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration. The Adviser serves as collateral manager for the CLO VI Issuer under a collateral management agreement dated as of the CLO VI Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO VI Issuers' equity or notes that we own. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt."
Unsecured Notes
2023 Notes
On December 21, 2017, we entered into a Note Purchase Agreement governing the
issuance of $150 million in aggregate principal amount of unsecured notes (the
"2023 Notes") to institutional investors in a private placement. The 2023 Notes
had a fixed interest rate of 4.75% and were due on June 21, 2023. Interest on
the 2023 Notes was due and ranked semiannually. This interest rate was subject
to increase (up to a maximum interest rate of 5.50%) in the event that, subject
to certain exceptions, the 2023 Notes ceased to have an
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investment grade rating. We were obligated to offer to repay the 2023 Notes at
par if certain change in control events occur. The 2023 Notes were our general
unsecured obligations and ranked pari passu with all outstanding and future
unsecured unsubordinated indebtedness issued by us.
The Note Purchase Agreement for the 2023 Notes contained customary terms and
conditions for unsecured notes issued in a private placement, including, without
limitation, affirmative and negative covenants such as information reporting,
maintenance of our status as a BDC within the meaning of the 1940 Act and a RIC
under the Code, minimum shareholders equity, minimum asset coverage ratio and
prohibitions on certain fundamental changes at us or any subsidiary guarantor,
as well as customary events of default with customary cure and notice,
including, without limitation, nonpayment, misrepresentation in a material
respect, breach of covenant, cross-default under other indebtedness of us or
certain significant subsidiaries, certain judgments and orders, and certain
events of bankruptcy.
The 2023 Notes were offered in reliance on Section 4(a)(2) of the Securities Act.
In connection with the offering of the 2023 Notes, on December 21, 2017 we entered into a centrally cleared interest rate swap. The notional amount of the interest rate swap was $150 million. We received fixed rate interest semi-annually at 4.75% and paid variable rate interest monthly based on 1-month LIBOR plus 2.545%. The interest rate swap matured on December 21, 2021. For the years ended December 31, 2021, 2020 and 2019, we made periodic payments of $4.0 million, $4.8 million and $7.4 million, respectively. The interest expense related to the 2023 Notes was equally offset by proceeds received from the interest rate swap. The swap adjusted interest expense is included as a component of interest expense in our Consolidated Statements of Operations. As of December 31, 2020, the interest rate swap had a fair value of $3.0 million. Depending on the nature of the balance at period end, the fair value of the interest rate swap is either included as a component of accrued expenses and other liabilities or prepaid expenses and other assets on our Consolidated Statements of Assets and Liabilities. The change in fair value of the interest rate swap is offset by the change in fair value of the 2023 Notes, with the remaining difference included as a component of interest expense on the Consolidated Statements of Operations. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt." On November 23, 2021, we caused notice to be issued to the holders of the 2023 Notes regarding our exercise of the option to redeem in full all $150 million in aggregate principal amount of the 2023 Notes at 100% of their principal amount, plus the accrued and unpaid interest thereon through, but excluding, the redemption date, December 23, 2021. On December 23, 2021, we redeemed in full all $150 million in aggregate principal amount of the 2023 Notes at 100% of their principal amount, plus the accrued and unpaid interest thereon through, but excluding, December 23, 2021.
2024 Notes
On April 10, 2019, we issued $400 million aggregate principal amount of notes that mature on April 15, 2024 (the "2024 Notes"). The 2024 Notes bear interest at a rate of 5.250% per year, payable semi-annually on April 15 and October 15 of each year, commencing on October 15, 2019. We may redeem some or all of the 2024 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2024 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2024 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any 2024 Notes on or after March 15, 2024 (the date falling one month prior to the maturity date of the 2024 Notes), the redemption price for the 2024 Notes will be equal to 100% of the principal amount of the 2024 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption. In connection with the issuance of the 2024 Notes, on April 10, 2019 we entered into centrally cleared interest rate swaps. The notional amount of the interest rate swaps is $400 million. We will receive fixed rate interest at 5.25% and pay variable rate interest based on one-month LIBOR plus 2.937%. The interest rate swaps mature on April 10, 2024. For the years ended December 31, 2021, 2020 and 2019, we made periodic payments of $8.7 million, $19.3 million and $10.8 million, respectively. The interest expense related to the 2024 Notes is equally offset by the proceeds received from the interest rate swaps. The swap adjusted interest expense is included as a component of interest expense on our Consolidated Statements of Operations. As of December 31, 2021 and 2020, the interest rate swap had a fair value of $12.0 million and $26.9 million, respectively. Depending on the nature of the balance at period end, the fair value of the interest rate swap is either included as a component of accrued expenses and other liabilities or prepaid expenses and other assets on our Consolidated Statements of Assets and Liabilities. The change in fair value of the interest rate swap is offset by the change in fair value of the 2024 Notes, with the remaining difference included as a component of interest expense on the Consolidated Statements of Operations. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt."
2025 Notes
On October 8, 2019, we issued $425 million aggregate principal amount of notes
that mature on March 30, 2025 (the "2025 Notes"). The 2025 Notes bear interest
at a rate of 4.00% per year, payable semi-annually on March 30 and September 30
of each year, commencing on March 30, 2020. We may redeem some or all of the
2025 Notes at any time, or from time to time, at a redemption price equal to the
greater of (1) 100% of the principal amount of the 2025 Notes to be redeemed or
(2) the sum of the present values of the remaining scheduled payments of
principal and interest (exclusive of accrued and unpaid interest to the date of
redemption) on the 2025 Notes to be redeemed, discounted to the redemption date
on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day
months) using the applicable Treasury Rate plus 40 basis points, plus, in each
case, accrued and unpaid interest to the redemption date;
138
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provided, however, that if we redeem any 2025 Notes on or after February 28,
2025 (the date falling one month prior to the maturity date of the 2025 Notes),
the redemption price for the 2025 Notes will be equal to 100% of the principal
amount of the 2025 Notes to be redeemed, plus accrued and unpaid interest, if
any, to, but excluding, the date of redemption. For further details, see "ITEM
8. - Notes to Consolidated Financial Statements - Note 6. Debt."
July 2025 Notes
On January 22, 2020, we issued $500 million aggregate principal amount of notes that mature on July 22, 2025 (the "July 2025 Notes"). The July 2025 Notes bear interest at a rate of 3.75% per year, payable semi-annually on January 22 and July 22, of each year, commencing on July 22, 2020. We may redeem some or all of the July 2025 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the July 2025 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the July 2025 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 35 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any July 2025 Notes on or after June 22, 2025 (the date falling one month prior to the maturity date of the 2025 Notes), the redemption price for the July 2025 Notes will be equal to 100% of the principal amount of the July 2025 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt." 2026 Notes On July 23, 2020, we issued $500 million aggregate principal amount of notes that mature on January 15, 2026 (the "2026 Notes"). The 2026 Notes bear interest at a rate of 4.25% per year, payable semi-annually on January 15 and July 15 of each year, commencing on January 15, 2021. We may redeem some or all of the 2026 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2026 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2026 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any 2026 Notes on or after December, 15 2025 (the date falling one month prior to the maturity date of the 2026 Notes), the redemption price for the 2026 Notes will be equal to 100% of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption. For further details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6. Debt."
July 2026 Notes
On December 8, 2020, we issued $1.0 billion aggregate principal amount of notes
that mature on July 15, 2026 (the "July 2026 Notes"). The July 2026 Notes bear
interest at a rate of 3.40% per year, payable semi-annually on January 15 and
July 15 of each year, commencing on July 15, 2021. We may redeem some or all of
the July 2026 Notes at any time, or from time to time, at a redemption price
equal to the greater of (1) 100% of the principal amount of the July 2026 Notes
to be redeemed or (2) the sum of the present values of the remaining scheduled
payments of principal and interest (exclusive of accrued and unpaid interest to
the date of redemption) on the July 2026 Notes to be redeemed, discounted to the
redemption date on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) using the applicable Treasury Rate plus 50 basis points,
plus, in each case, accrued and unpaid interest to the redemption date;
provided, however, that if we redeem any July 2026 Notes on or after June 15,
2026 (the date falling one month prior to the maturity date of the July 2026
Notes), the redemption price for the July 2026 Notes will be equal to 100% of
the principal amount of the July 2026 Notes to be redeemed, plus accrued and
unpaid interest, if any, to, but excluding, the date of redemption. For further
details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6.
Debt."
2027 Notes
On April 26, 2021, we issued $500 million aggregate principal amount of notes
that mature on January 15, 2027 (the "2027 Notes"). The 2027 Notes bear interest
at a rate of 2.625% per year, payable semi-annually on January 15 and July 15,
of each year, commencing on July 15, 2021. We may redeem some or all of the 2027
Notes at any time, or from time to time, at a redemption price equal to the
greater of (1) 100% of the principal amount of the 2027 Notes to be redeemed or
(2) the sum of the present values of the remaining scheduled payments of
principal and interest (exclusive of accrued and unpaid interest to the date of
redemption) on the 2027 Notes to be redeemed, discounted to the redemption date
on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day
months) using the applicable Treasury Rate plus 30 basis points, plus, in each
case, accrued and unpaid interest to the redemption date; provided, however,
that if we redeem any 2027 Notes on or after December 15, 2026 (the date falling
one month prior to the maturity date of the 2027 Notes), the redemption price
for the 2027 Notes will be equal to 100% of the principal amount of the 2027
Notes to be redeemed, plus accrued and unpaid interest, if any, to, but
excluding, the date of redemption.
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In connection with the issuance of the 2027 Notes, on April 26, 2021 we entered
into centrally cleared interest rate swaps. The notional amount of the interest
rate swaps is $500 million. We will receive fixed rate interest at 2.625% and
pay variable rate interest based on one-month LIBOR plus 1.655%. The interest
rate swaps mature on January 15, 2027. For the year ended December 31, 2021, we
made periodic payments of $0.9 million. The interest expense related to the 2027
Notes is equally offset by the proceeds received from the interest rate swaps.
The swap adjusted interest expense is included as a component of interest
expense on our Consolidated Statements of Operations. As of December 31, 2021,
the interest rate swap had a fair value of $7.6 million. Depending on the nature
of the balance at period end, the fair value of the interest rate swap is either
included as a component of accrued expenses and other liabilities or prepaid
expenses and other assets on our Consolidated Statements of Assets and
Liabilities. The change in fair value of the interest rate swap is offset by the
change in fair value of the 2027 Notes, with the remaining difference included
as a component of interest expense on the Consolidated Statements of Operations.
For further details, see "ITEM 8. - Notes to Consolidated Financial Statements -
Note 6. Debt."
2028 Notes
On June 11, 2021, we issued $450 million aggregate principal amount of notes
that mature on June 11, 2028 and on August 17, 2021, we issued an additional
$400 million aggregate principal amount of our 2.875% notes due 2028 (together,
the "2028 Notes"). The 2028 Notes bear interest at a rate of 2.875% per year,
payable semi-annually on June 11 and December 11, of each year, commencing on
December 11, 2021. We may redeem some or all of the 2028 Notes at any time, or
from time to time, at a redemption price equal to the greater of (1) 100% of the
principal amount of the 2028 Notes to be redeemed or (2) the sum of the present
values of the remaining scheduled payments of principal and interest (exclusive
of accrued and unpaid interest to the date of redemption) on the 2028 Notes to
be redeemed, discounted to the redemption date on a semi-annual basis (assuming
a 360-day year consisting of twelve 30-day months) using the applicable Treasury
Rate plus 30 basis points, plus, in each case, accrued and unpaid interest to
the redemption date; provided, however, that if we redeem any 2028 Notes on or
after April 11, 2028 (the date falling two months prior to the maturity date of
the 2028 Notes), the redemption price for the 2028 Notes will be equal to 100%
of the principal amount of the 2028 Notes to be redeemed, plus accrued and
unpaid interest, if any, to, but excluding, the date of redemption. For further
details, see "ITEM 8. - Notes to Consolidated Financial Statements - Note 6.
Debt."
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--------------------------------------------------------------------------------Off-Balance Sheet Arrangements
Portfolio Company Commitments
From time to time, we may enter into commitments to fund investments. As of December 31, 2021 and December 31, 2020, we had the following outstanding commitments to fund investments in current portfolio companies:
Portfolio Company Investment December 31, 2021 December 31, 2020
($ in thousands)
3ES Innovation Inc. (dba First lien senior secured $ 3,893 $ 3,893
Aucerna) revolving loan
Accela, Inc. First lien senior secured 3,000 3,000
revolving loan
Alera Group, Inc. First lien senior secured 417 -
delayed draw term loan
AmSpec Group, Inc. (fka First lien senior secured 10,665 14,462
AmSpec Services Inc.) revolving loan
Apex Group Treasury, LLC Second lien senior secured 25,147 -
delayed draw term loan
Apptio, Inc. First lien senior secured 1,667 2,779
revolving loan
Aramsco, Inc. First lien senior secured 8,378 8,378
revolving loan
Ardonagh Midco 3 PLC First lien senior secured GBP 11,038 16,950
delayed draw term loan
Ascend Buyer, LLC (dba PPC First lien senior secured 471 -
Flexible Packaging) revolving loan
Associations, Inc. First lien senior secured - 866
delayed draw term loan A
Associations, Inc. First lien senior secured 32,923 -
revolving loan
AxiomSL Group, Inc. First lien senior secured 8,331 -
delayed draw term loan
AxiomSL Group, Inc. First lien senior secured 18,227 9,341
revolving loan
Bayshore Intermediate #2, First lien senior secured 6,913 -
L.P. (dba Boomi) revolving loan
BCPE Osprey Buyer, Inc. (dba First lien senior secured 28,014 -
PartsSource) delayed draw term loan
BCPE Osprey Buyer, Inc. (dba First lien senior secured 11,855 -
PartsSource) revolving loan
BCTO BSI Buyer, Inc. (dba First lien senior secured 2,339 5,357
Buildertrend) revolving loan
Blend Labs, Inc. First lien senior secured 7,500 -
revolving loan
BP Veraison Buyer, LLC (dba First lien senior secured 29,054 -
Sun World) delayed draw term loan
BP Veraison Buyer, LLC (dba First lien senior secured 8,716 -
Sun World) revolving loan
Brightway Holdings, LLC First lien senior secured 3,158 -
revolving loan
Caiman Merger Sub LLC (dba First lien senior secured
- 12,881
City Brewing) revolving loan
Centrify Corporation First lien senior secured 6,817 -
revolving loan
CivicPlus, LLC First lien senior secured 6,673 -
delayed draw term loan
CivicPlus, LLC First lien senior secured 1,335 -
revolving loan
ConnectWise, LLC First lien senior secured - 15,004
revolving loan
Definitive Healthcare First lien senior secured - 35,651
Holdings, LLC delayed draw term loan
Definitive Healthcare First lien senior secured - 10,870
Holdings, LLC revolving loan
Denali BuyerCo, LLC (dba First lien senior secured 9,849 -
Summit Companies) delayed draw term loan
141
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Portfolio Company Investment December 31, 2021 December 31, 2020
Denali BuyerCo, LLC (dba First lien senior secured 3,556 -
Summit Companies) revolving loan
Diamondback Acquisition, First lien senior secured 1,080 -
Inc. (dba Sphera) delayed draw term loan
Dodge Data & Analytics LLC First lien senior secured 1,888 -
revolving loan
Douglas Products and First lien senior secured 3,936 6,055
Packaging Company LLC revolving loan
EET Buyer, Inc. (dba First lien senior secured 455 -
e-Emphasys) revolving loan
Endries Acquisition, Inc. First lien senior secured - 27,000
revolving loan
Entertainment Benefits First lien senior secured 11,200 1,104
Group, LLC revolving loan
Evolution BuyerCo, Inc. (dba First lien senior secured 10,709 -
SIAA) revolving loan
Forescout Technologies, Inc. First lien senior secured 5,345 5,345
revolving loan
Fortis Solutions Group, LLC First lien senior secured 1,347 -
delayed draw term loan
Fortis Solutions Group, LLC First lien senior secured 462 -
revolving loan
Gainsight, Inc. First lien senior secured 3,357 -
revolving loan
Galls, LLC First lien senior secured 20,468 11,204
revolving loan
Gaylord Chemical Company, First lien senior secured 13,202 -
L.L.C. revolving loan
GC Agile Holdings Limited First lien senior secured - 6,924
(dba Apex Fund Services) revolving loan
Gerson Lehrman Group, Inc. First lien senior secured 21,563 21,563
revolving loan
GI Ranger Intermediate, LLC First lien senior secured 614 -
(dba Rectangle Health) delayed draw term loan GI Ranger Intermediate, LLC First lien senior secured
369 -
(dba Rectangle Health) revolving loan
Global Music Rights, LLC First lien senior secured 667 -
revolving loan
GovBrands Intermediate, Inc. First lien senior secured 1,111 -
delayed draw term loan
GovBrands Intermediate, Inc. First lien senior secured 793 -
revolving loan
Granicus, Inc. First lien senior secured 1,006 -
delayed draw term loan
Granicus, Inc. First lien senior secured 1,187 2,636
revolving loan
Guidehouse Inc. First lien senior secured 351 -
revolving loan
H&F Opportunities LUX III First lien senior secured 16,250 16,250
S.À R.L (dba Checkmarx) revolving loan
Hercules Borrower, LLC (dba First lien senior secured 20,916 20,916
The Vincit Group) revolving loan
HGH Purchaser, Inc. (dba First lien senior secured 49,359 5,346
Horizon Services) delayed draw term loan
HGH Purchaser, Inc. (dba First lien senior secured 7,031 8,748
Horizon Services) revolving loan
Hometown Food Company First lien senior secured 4,235 3,671
revolving loan
Ideal Tridon Holdings, Inc. First lien senior secured 3,927 4,828
revolving loan
142
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Portfolio Company Investment December 31, 2021 December 31, 2020
IG Investments Holdings, LLC First lien senior secured 1,987 -
(dba Insight Global) revolving loan
Individual Foodservice First lien senior secured 6,890 25,781
Holdings, LLC delayed draw term loan
Individual Foodservice First lien senior secured 20,609 18,465
Holdings, LLC revolving loan
Inovalon Holdings, Inc. First lien senior secured 18,988 -
delayed draw term loan
Instructure, Inc. First lien senior secured - 5,554
revolving loan
Integrity Marketing First lien senior secured 14,832 14,832
Acquisition, LLC revolving loan
Intelerad Medical Systems First lien senior secured 1,607 4,530
Incorporated (fka 11849573 revolving loan
Canada Inc.)
Interoperability Bidco, Inc. First lien senior secured - 8,000
delayed draw term loan
Interoperability Bidco, Inc. First lien senior secured 4,000 -
revolving loan
IQN Holding Corp. (dba First lien senior secured 22,672 22,672
Beeline) revolving loan
KPSKY Acquisition, Inc. (dba First lien senior secured 256 -
BluSky) delayed draw term loan
KWOR Acquisition, Inc. (dba First lien senior secured - 2,063
Worley Claims Services) delayed draw term loan KWOR Acquisition, Inc. (dba First lien senior secured
- 5,200
Alacrity Solutions) revolving loan
Lazer Spot G B Holdings, First lien senior secured 26,833 26,833
Inc. revolving loan
Lignetics Investment Corp. First lien senior secured 3,922 -
delayed draw term loan
Lignetics Investment Corp. First lien senior secured 3,922 -
revolving loan
Lightning Midco, LLC (dba First lien senior secured
- 8,953
Vector Solutions) revolving loan
Litera Bidco LLC First lien senior secured 5,176 -
delayed draw term loan
Litera Bidco LLC First lien senior secured 5,738 5,738
revolving loan
Medline Intermediate, LP First lien senior secured 7,190 -
revolving loan
Lytx, Inc. First lien senior secured - 14,092
delayed draw term loan
Mavis Tire Express Services Second lien senior secured - 11,376
Corp. delayed draw term loan
MHE Intermediate Holdings, First lien senior secured 9,850 -
LLC (dba OnPoint Group) delayed draw term loan
MHE Intermediate Holdings, First lien senior secured 15,536 -
LLC (dba OnPoint Group) revolving loan
Milan Laser Holdings LLC First lien senior secured 2,078 -
revolving loan
MINDBODY, Inc. First lien senior secured 6,071 6,071
revolving loan
Ministry Brands Holdings, First lien senior secured 226 -
LLC delayed draw term loan
Ministry Brands Holdings, First lien senior secured 68 -
LLC revolving loan
National Dentex Labs LLC First lien senior secured 3,980 30,437
(fka Barracuda Dental LLC) delayed draw term loan National Dentex Labs LLC First lien senior secured
6,322 5,854
(fka Barracuda Dental LLC) revolving loan
143
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Portfolio Company Investment December 31, 2021 December 31, 2020
Nelipak Holding Company First lien senior secured 4,288 7,597
revolving loan
Nelipak Holding Company First lien senior secured 7,518 2,948
revolving loan
NMI Acquisitionco, Inc. (dba First lien senior secured 4,073 -
Network Merchants) delayed draw term loan
NMI Acquisitionco, Inc. (dba First lien senior secured 1,652 646
Network Merchants) revolving loan
Norvax, LLC (dba GoHealth) First lien senior secured 2,761 12,273
revolving loan
Notorious Topco, LLC (dba First lien senior secured 15,962 5,625
Beauty Industry Group) delayed draw term loan Notorious Topco, LLC (dba First lien senior secured
7,981 2,000
Beauty Industry Group) revolving loan
OB Hospitalist Group, Inc. First lien senior secured 13,533 -
revolving loan
Nutraceutical International First lien senior secured - 13,578
Corporation revolving loan
Patriot Acquisition TopCo First lien senior secured 13,538 -
S.A.R.L (dba Corza Health, revolving loan
Inc.)
Peter C. Foy & Associates First lien senior secured 8,695 37,955
Insurance Services, LLC (dba delayed draw term loan
PCF Insurance Services)
6,161 8,194
Insurance Services, LLC (dba revolving loan
PCF Insurance Services)
Pluralsight, LLC First lien senior secured 6,235 -
revolving loan
Professional Plumbing Group, First lien senior secured - 5,757
Inc. revolving loan
Project Power Buyer, LLC First lien senior secured 3,188 3,188
(dba PEC-Veriforce) revolving loan
PS Operating Company LLC First lien senior secured 2,650 633
(fka QC Supply, LLC) revolving loan
QAD, Inc. First lien senior secured 3,429 -
revolving loan
Quva Pharma, Inc. First lien senior secured 4,000 -
revolving loan
Reef Global Acquisition LLC First lien senior secured 5,377 5,377
(fka Cheese Acquisition, revolving loan
LLC)
Refresh Parent Holdings, First lien senior secured 797 29,482
Inc. delayed draw term loan
Refresh Parent Holdings, First lien senior secured 6,897 7,716
Inc. revolving loan
Relativity ODA LLC First lien senior secured 7,333 -
revolving loan
RSC Acquisition, Inc (dba First lien senior secured - 1,702
Risk Strategies) revolving loan
Safety Products/JHC First lien senior secured - 924Acquisition Corp. (dba delayed draw term loan Justrite Safety Group) Sara Lee Frozen Bakery, LLC First lien senior secured
8,700 4,440
(fka KSLB Holdings, LLC) revolving loan
Sonny's Enterprises LLC First lien senior secured 15,402 17,969
revolving loan
Swipe Acquisition First lien senior secured 10,230 18,461
Corporation (dba PLI) delayed draw term loan
Swipe Acquisition Letter of Credit 7,118 7,118
Corporation (dba PLI)
Tahoe Finco, LLC First lien senior secured 9,244 -
revolving loan
TC Holdings, LLC (dba First lien senior secured 7,685 7,685
TrialCard) revolving loan
144
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Portfolio Company Investment December 31, 2021 December 31, 2020
TEMPO BUYER CORP. (dba First lien senior secured 308 -
Global Claims Services) delayed draw term loan
TEMPO BUYER CORP. (dba First lien senior secured 154 -
Global Claims Services) revolving loan
The Shade Store, LLC First lien senior secured 909 -
revolving loan
THG Acquisition, LLC (dba First lien senior secured - 36,302
Hilb) delayed draw term loan
THG Acquisition, LLC (dba First lien senior secured 8,608 8,608
Hilb) revolving loan
Thunder Purchaser, Inc. (dba First lien senior secured 10,965 -
Vector Solutions) delayed draw term loan
Thunder Purchaser, Inc. (dba First lien senior secured 3,838 -
Vector Solutions) revolving loan
Trader Interactive, LLC (fka First lien senior secured - 4,471
Dominion Web Solutions, LLC) revolving loan
Troon Golf, L.L.C. First lien senior secured 21,621 14,426
revolving loan
TSB Purchaser, Inc. (dba First lien senior secured - 4,239
Teaching Strategies, Inc.) revolving loan
Ultimate Baked Goods Midco, First lien senior secured 4,724 4,638
LLC revolving loan
USRP Holdings, Inc. (dba First lien senior secured 4,168 -
U.S. Retirement and Benefits revolving loan
Partners)
Valence Surface Technologies First lien senior secured - 6,000
LLC delayed draw term loan
Valence Surface Technologies First lien senior secured 49 10,000
LLC revolving loan
Velocity HoldCo III Inc. First lien senior secured 1,340 -
(dba VelocityEHS) revolving loan
When I Work, Inc. First lien senior secured 925 -
revolving loan
WU Holdco, Inc. (dba Weiman First lien senior secured 14,829 -
Products, LLC) delayed draw term loan
WU Holdco, Inc. (dba Weiman First lien senior secured 13,444 10,739
Products, LLC) revolving loan
Wingspire Capital Holdings LLC Interest 51,962 82,462
LLC
Total Unfunded Portfolio $ 963,808 $ 880,626 Company Commitments We seek to carefully consider our unfunded portfolio company commitments for the purpose of planning our ongoing financial leverage. Further, we consider any outstanding unfunded portfolio company commitments we are required to fund within the 150% asset coverage limitation. As of December 31, 2021, we believed we had adequate financial resources to satisfy the unfunded portfolio company commitments.
Other Commitments and Contingencies
In connection with the IPO, on July 22, 2019, we entered into a stock repurchase
plan ("the Company 10b5-1 Plan"), to acquire up to $150 million in the aggregate
of our common stock at prices below its net asset value per share over a
specified period, in accordance with the guidelines specified in Rule 10b-18 and
Rule 10b5-1 of the Exchange Act. Under the Company 10b5-1 Plan, Goldman, Sachs &
Co. , as agent, acquired 12,515,624 shares for approximately $150 million. The
Company 10b5-1 Plan commenced on August 19, 2019 and was exhausted on August 4,
2020.
On November 3, 2020, our Board approved a repurchase program under which we may
repurchase up to $100 million of our outstanding common stock. Under the
program, purchases may be made at management's discretion from time to time in
open-market transactions, in accordance with all applicable securities laws and
regulations. Unless extended by the Board, the repurchase program will terminate
12-months from the date it was approved. On November 2, 2021, the Board approved
an extension to the Repurchase Plan and, unless further extended by the Board,
will terminate 12-months from that date. As of December 31, 2021, Goldman, Sachs
& Co. , as agent, has repurchased 186,150 shares of the Company's common stock
pursuant to the Repurchase Plan for approximately $2.6 million.
From time to time, we may become a party to certain legal proceedings incidental
to the normal course of its business. At December 31, 2021, we were not aware of
any material pending or threatened litigation that would require accounting
recognition or financial statement disclosure.
145
--------------------------------------------------------------------------------Contractual Obligations
A summary of our contractual payment obligations under our credit facilities as of December 31, 2021, is as follows:
Payments Due
by Period
Less than 1
($ in millions) Total year 1-3 years 3-5 years After 5 years
Revolving Credit 892.3 -
Facility $ 892.3 $ - $ -
SPV Asset Facility II 100.0 - - - 100.0
SPV Asset Facility III 190.0 - 190.0 - -
SPV Asset Facility IV 155.0 - - - 155.0
CLO I 390.0 - - - 390.0
CLO II 260.0 - - - 260.0
CLO III 260.0 - - - 260.0
CLO IV 292.5 - - - 292.5
CLO V 196.0 - - - 196.0
CLO VI 260.0 - - - 260.0
2024 Notes 400.0 - 400.0 - -
2025 Notes 425.0 - - 425.0 -
July 2025 Notes 500.0 - - 500.0 -
2026 Notes 500.0 - - 500.0 -
July 2026 Notes 1,000.0 - - 1,000.0 -
2027 Notes 500.0 - - - 500.0
2028 Notes 850.0 - - - 850.0
Total Contractual
Obligations $ 7,170.8 $ - $ 590.0 $ 3,317.3 $ 3,263.5
Related-Party Transactions
We have entered into a number of business relationships with affiliated or related parties, including the following:
•
the Investment Advisory Agreement;
•
the Administration Agreement; and
•
the License Agreement.
In addition to the aforementioned agreements, we, our Adviser and certain of our Adviser's affiliates have been granted exemptive relief by theSEC to co-invest with other funds managed by the Adviser or its affiliates, in a manner consistent with our investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. See "ITEM 8. - Consolidated Financial Statements and Supplementary Data - Note 3. Agreements and Related Party Transactions" for further details. We invest through Wingspire and, together with Nationwide, through ORCC SLF, controlled affiliated investments as defined in the 1940 Act. See "ITEM 8. - Consolidated Financial Statements and Supplementary Data - Note 3. Agreements and Related Party Transactions" for further details.
Critical Accounting Policies
The preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Changes in the economic environment, financial markets, and any other parameters used in determining such estimates could cause actual results to differ. Our critical accounting policies should be read in connection with our risk factors as described in "ITEM 1A. RISK FACTORS."
Investments at Fair Value
Investment transactions are recorded on the trade date. Realized gains or losses
are measured by the difference between the net proceeds received (excluding
prepayment fees, if any) 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. The net change in unrealized gains or losses primarily
reflects the change in investment values, including the reversal of previously
recorded unrealized gains or losses with respect to investments realized during
the period.
Investments for which market quotations are readily available are typically
valued at the bid price of those market quotations. To validate market
quotations, we utilize a number of factors to determine if the quotations are
representative of fair value, including the source and number of the quotations.
Debt and equity securities that are not publicly traded or whose market prices
are not readily available, as is the case for substantially all of our
investments, are valued at fair value as determined in good faith by our Board,
based
146
--------------------------------------------------------------------------------on, among other things, the input of the Adviser, our audit committee and independent third-party valuation firm(s) engaged at the direction of the Board.
As part of the valuation process, the Board takes into account relevant factors in determining the fair value of our investments, including: the estimated enterprise value of a portfolio company (i.e., the total fair value of the portfolio company's debt and equity), the nature and realizable value of any collateral, the portfolio company's ability to make payments based on its earnings and 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, and overall changes in the interest rate environment and the credit markets that may affect the price at which similar investments may be made in the future. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Board considers whether the pricing indicated by the external event corroborates its valuation.
The Board undertakes a multi-step valuation process, which includes, among other procedures, the following:
•
With respect to investments for which market quotations are readily available, those investments will typically be valued at the bid price of those market quotations;
•
With respect to investments for which market quotations are not readily available, the valuation process begins with the independent valuation firm(s) providing a preliminary valuation of each investment to the Adviser's valuation committee;
•
Preliminary valuation conclusions are documented and discussed with the Adviser's valuation committee. Agreed upon valuation recommendations are presented to the Audit Committee;
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The Audit Committee reviews the valuation recommendations and recommends values for each investment to the Board; and
•
The Board reviews the recommended valuations and determines the fair value of each investment.
We conduct this valuation process on a quarterly basis.
We apply ASC 820, which establishes a framework for measuring fair value in accordance withU.S. GAAP and required disclosures of fair value measurements. ASC 820 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. Market participants are defined as buyers and sellers in the principal or most advantageous market (which may be a hypothetical market) that are independent, knowledgeable, and willing and able to transact. In accordance with ASC 820, we consider its principal market to be the market that has the greatest volume and level of activity. ASC 820 specifies a fair value hierarchy that prioritizes and ranks the level of observability of inputs used in determination of fair value. In accordance with ASC 820, these levels are summarized below:
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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.
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Level 3 - Valuations based on inputs that are unobservable and significant to the overall fair value measurement.
Transfers between levels, if any, are recognized at the beginning of the period in which the transfer occurred. In addition to using the above inputs in investment valuations, we apply the valuation policy approved by our Board that is consistent with ASC 820. Consistent with the valuation policy, we evaluate the source of the inputs, including any markets in which our investments are trading (or any markets in which securities with similar attributes are trading), in determining fair value. When an investment is valued based on prices provided by reputable dealers or pricing services (that is, broker quotes), we subject those prices to various criteria in making the determination as to whether a particular investment would qualify for treatment as a Level 2 or Level 3 investment. For example, we, or the independent valuation firm(s), review pricing support provided by dealers or pricing services in order to determine if observable market information is being used, versus unobservable inputs. 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 such 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 may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If we were required to liquidate a portfolio investment in a forced or liquidation sale, it could realize amounts that are different from the amounts presented and such differences could be material.
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 herein.
Rule 2a-5 under the 1940 Act was recently adopted by theSEC and establishes requirements for determining fair value in good faith for purposes of the 1940 Act. We are evaluating the impact of adopting Rule 2a-5 on the consolidated financial statements and intend to comply with the new rule's requirements on or before the compliance date in September 2022. 147 --------------------------------------------------------------------------------
Interest and Dividend Income Recognition
Interest income is recorded on the accrual basis and includes amortization of
discounts or premiums. Certain investments may have contractual payment-in-kind
("PIK") interest or dividends. PIK interest or dividends represent accrued
interest or dividends that are added to the principal amount of the investment
on the respective interest or dividend payment dates rather than being paid in
cash and generally becomes due at maturity or at the occurrence of a liquidation
event. Discounts to par value on securities purchased are amortized into
interest income over the contractual life of the respective security using the
effective yield method. Premiums to par value on securities purchased are
amortized to first call date. The amortized cost of investments represents the
original cost adjusted for the amortization of discounts or premiums, if any.
Upon prepayment of a loan or debt security, any prepayment premiums, unamortized
upfront loan origination fees and unamortized discounts are recorded as interest
income in the current period.
Loans are generally placed on non-accrual status when there is reasonable doubt
that principal or interest will be collected in full. Accrued 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. If at
any point we believe PIK interest is not expected to be realized, the investment
generating PIK interest will be placed on non-accrual status. When a PIK
investment is placed on non-accrual status, the accrued, uncapitalized interest
or dividends are generally reversed through interest income. Non-accrual loans
are restored to accrual status when past due principal and interest is paid
current and, in management's judgment, are likely to remain current. Management
may make exceptions to this treatment and determine to not place a loan on
non-accrual status if the loan has sufficient collateral value and is in the
process of collection.
Dividend income on preferred equity securities is recorded on the 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.
Distributions
We have elected to be treated for
•
investment company taxable income (which is generally our ordinary income plus the excess of realized short-term capital gains over realized net long-term capital losses), determined without regard to the deduction for dividends paid, for such taxable year; and
•
net tax-exempt interest income (which is the excess of our gross tax-exempt interest income over certain disallowed deductions) for such taxable year.
As a RIC, we (but not our shareholders) generally will not be subject toU.S. federal tax on investment company taxable income and net capital gains that we distribute to our shareholders. We intend to distribute annually all or substantially all of such income. To the extent that we retain our net capital gains or any investment company taxable income, we generally will be subject to corporate-levelU.S. federal income tax. We can be expected to carry forward our net capital gains or any investment company taxable income in excess of current year dividend distributions, and pay theU.S. federal excise tax as described below. Amounts not distributed on a timely basis in accordance with a calendar year distribution requirement are subject to a nondeductible 4%U.S. federal excise tax payable by us. We may be subject to a nondeductible 4%U.S. federal excise tax if we do not distribute (or are treated as distributing) during each calendar year an amount at least equal to the sum of:
•
98% of our net ordinary income excluding certain ordinary gains or losses for that calendar year;
•
98.2% of our capital gain net income, adjusted for certain ordinary gains and losses, recognized for the twelve-month period ending on October 31 of that calendar year; and
•
100% of any income or gains recognized, but not distributed, in preceding years.
While we intend to distribute any income and capital gains in the manner necessary to minimize imposition of the 4%U.S. federal excise tax, sufficient amounts of our taxable income and capital gains may not be distributed and as a result, in such cases, the excise tax will be imposed. In such an event, we will be liable for this tax only on the amount by which we do not meet the foregoing distribution requirement. We intend to pay quarterly distributions to our shareholders out of assets legally available for distribution. All distributions will be paid at the discretion of our Board and will depend on our earnings, financial condition, maintenance of our tax treatment as a RIC, compliance with applicable BDC regulations and such other factors as our Board may deem relevant from time to time. To the extent our current taxable earnings for a year fall below the total amount of our distributions for that year, a portion of those distributions may be deemed a return of capital to our shareholders forU.S. federal income tax purposes. Thus, the source of a distribution 148 --------------------------------------------------------------------------------
to our shareholders may be the original capital invested by the shareholder rather than our income or gains. Shareholders should read written disclosure carefully and should not assume that the source of any distribution is our ordinary income or gains.
We have adopted an "opt out" dividend reinvestment plan for our common shareholders. As a result, if we declare a cash dividend or other distribution, each shareholder that has not "opted out" of our dividend reinvestment plan will have their dividends or distributions automatically reinvested in additional shares of our common stock rather than receiving cash distributions. Shareholderswho receive distributions in the form of shares of common stock will be subject to the sameU.S. federal, state and local tax consequences as if they received cash distributions.
Income Taxes
We have elected to be treated as a BDC under the 1940 Act. We have also elected to be treated as a RIC under the Code beginning with the taxable year ending December 31, 2016 and intend to continue to qualify as a RIC. So long as we maintain our tax treatment as a RIC, we generally will not pay corporate-levelU.S. federal income taxes on any ordinary income or capital gains that we distribute at least annually to our shareholders as distributions. Rather, any tax liability related to income earned and distributed by us represents obligations of our investors and will not be reflected in our consolidated financial statements. To qualify as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements. In addition, to qualify for RIC tax treatment, we must distribute to our shareholders, for each taxable year, at least 90% of our "investment company taxable income" for that year, which is generally our ordinary income plus the excess of our realized net short-term capital gains over our realized net long-term capital losses. In order for us to not be subject toU.S. federal excise taxes, we must distribute annually an amount at least equal to the sum of (i) 98% of our net ordinary income (taking into account certain deferrals and elections) for the calendar year, (ii) 98.2% of our capital gains in excess of capital losses for the one-year period ending on October 31 of the calendar year and (iii) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years. We, at our discretion, may carry forward taxable income in excess of calendar year dividends and pay a 4% nondeductibleU.S. excise tax on this income.
Certain consolidated subsidiaries of ours are subject to
We evaluate tax positions taken or expected to be taken in the course of preparing our consolidated financial statements to determine whether the tax positions are "more-likely-than-not" to be sustained by the applicable tax authority. Tax positions not deemed to meet the "more-likely-than-not" threshold are reserved and recorded as a tax benefit or expense in the current year. All penalties and interest associated with income taxes are included in income tax expense. Conclusions regarding tax positions are subject to review and may be adjusted at a later date based on factors including, but not limited to, on-going analyses of tax laws, regulations and interpretations thereof. There were no material uncertain tax positions through December 31, 2021. The 2018 through 2020 tax years remain subject to examination by theIRS , and generally years 2017 through 2020 remain subject to examination by state and local tax authorities. Recent Developments On January 24, 2022,Brian Finn notifiedOwl Rock Capital Corporation (the "Company") of his intention to resign as a director of the Company, effective February 23, 2022.Mr. Finn has served on the Company's Board of Directors (the "Board") since 2016 and currently serves as a member of the Audit Committee, Nominating and Corporate Governance Committee and Compensation Committee of the Board.Mr. Finn's decision to resign was based on a desire to pursue other opportunities and not the result of any disagreement relating to the Company's operations, policies or practices. On February 23, 2022, the Board acceptedMr. Finn's resignation and voted to reduce the size of the Board from seven to six directors.
On February 23, 2022, the Board declared a distribution of $0.31 per share for shareholders of record on March 31, 2022 payable on or before May 13, 2022.
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