Bain Capital Specialty Finance, Inc. - Quarter Report: 2018 September (Form 10-Q)

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

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

For the quarterly period ended September 30, 2018

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

Commission file number: 814-01175

BAIN CAPITAL SPECIALTY FINANCE, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware		81-2878769
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

200 Clarendon Street, 37th Floor Boston, MA		02116
(Address of Principal Executive Office)		(Zip Code)

(617) 516-2000

(Registrant’s Telephone Number, Including Area Code)

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

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

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

Large accelerated filer o		Accelerated filer o

Non-accelerated filer x		Smaller reporting company o

		Emerging growth company x

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

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

As of October 17, 2018, the registrant had 43,821,595.55 shares of common stock, $0.001 par value, outstanding.

Table of Contents

TABLE OF CONTENTS

		Page

PART I	FINANCIAL INFORMATION	4

Item 1.	Consolidated Financial Statements	4

	Consolidated Statements of Assets and Liabilities as of September 30, 2018 (unaudited) and December 31, 2017	4

	Consolidated Statements of Operations for the three and nine months ended September 30, 2018 and 2017 (unaudited)	5

	Consolidated Statements of Changes in Net Assets for the nine months ended September 30, 2018 and 2017 (unaudited)	6

	Consolidated Statements of Cash Flows for the nine months ended September 30, 2018 and 2017 (unaudited)	7

	Consolidated Schedules of Investments as of September 30, 2018 (unaudited) and December 31, 2017	8

	Notes to Consolidated Financial Statements (unaudited)	26

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	58

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	83

Item 4.	Controls and Procedures	83

PART II	OTHER INFORMATION	86

Item 1.	Legal Proceedings	86

Item 1A.	Risk Factors	86

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	86

Item 3.	Defaults Upon Senior Securities	86

Item 4.	Mine Safety Disclosures	86

Item 5.	Other Information	86

Item 6.	Exhibits	87

Signatures		89

Table of Contents

FORWARD-LOOKING STATEMENTS

Statements contained in this Quarterly Report on Form 10-Q (the “Quarterly Report”) (including those relating to current and future market conditions and trends in respect thereof) that are not historical facts are based on current expectations, estimates, projections, opinions and/or beliefs of the Company, BCSF Advisors, LP (the “Advisor”) and/or Bain Capital Credit, LP and its affiliated advisers (collectively, “Bain Capital Credit”). Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. Certain information contained in this Quarterly Report constitutes “forward-looking statements,” which can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “seek,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue,” “target,” or “believe” or the negatives thereof or other variations thereon or comparable terminology. Due to various risks and uncertainties, actual events or results or the actual performance of the Company may differ materially from those reflected or contemplated in such forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties, and other factors, some of which are beyond our control and are difficult to predict, that could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements including, without limitation, the risks, uncertainties and other factors we identify in the section entitled Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K (the “Annual Report”) for the fiscal year ended December 31, 2017 and in our filings with the Securities and Exchange Commission (the “SEC”).

Although we believe that the assumptions on which these forward-looking statements are based are reasonable, some of those assumptions may be based on the work of third parties and any of those assumptions could prove to be inaccurate; as a result, the forward-looking statements based on those assumptions also could prove to be inaccurate. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Quarterly Report should not be regarded as a representation by us that our plans and objectives will be achieved. These risks and uncertainties include those described or identified in the section entitled Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2017. Investors should not place undue reliance on these forward-looking statements, which apply only as of the date of this Quarterly Report. We do not undertake any obligation to update or revise any forward-looking statements or any other information contained herein, except as required by applicable law. The safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which preclude civil liability for certain forward-looking statements, do not apply to the forward-looking statements in this Quarterly Report because we are an investment company.

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Bain Capital Specialty Finance, Inc.

Consolidated Statements of Assets and Liabilities

	As of			As of
	September 30, 2018			December 31, 2017
	(Unaudited)
Assets
Investments at fair value:
Non-controlled/non-affiliate investments (amortized cost of $1,068,707,548 and $633,645,701, respectively)	$	1,075,932,730		$	643,067,956
Controlled affiliate investments (amortized cost of $273,054,968 and $187,617,223, respectively)	275,509,851			188,510,115
Cash and cash equivalents	151,069,731			139,506,289
Foreign cash (cost of $1,684,252 and $1,383,845, respectively)	1,666,238			1,411,855
Restricted Cash	37,735,920			—
Collateral on forward currency exchange contracts	824,191			4,421,968
Deferred offering costs	1,085,000			—
Deferred financing costs	4,736,156			5,808,726
Interest receivable on investments	4,482,186			2,888,847
Prepaid insurance	3,033			137,785
Receivable for sales and paydowns of investments	37,347			2,497,769
Distribution receivable	61,101			—
Unrealized appreciation on forward currency exchange contracts	5,618,287			—
Dividend receivable	6,084,313			—
Total Assets	$	1,564,846,084		$	988,251,310

Liabilities
Revolving credit facilities	$	233,639,250		$	451,000,000
2018-1 Notes (net of unamortized debt issuance costs of $2,084,044 and $0, respectively)	363,615,956			—
Deferred offering costs payable	1,085,000			—
Interest payable	598,802			815,402
Payable for investments purchased	56,273,526			14,814,984
Unrealized depreciation on forward currency exchange contracts	—			3,504,814
Base management fee payable	2,319,541			1,244,033
Incentive fee payable	2,930,760			1,017,919
Accounts payable and accrued expenses	2,455,164			1,143,946
Excise tax payable	—			4,882
Distributions payable	17,966,855			7,742,502
Total Liabilities	680,884,854			481,288,482

Commitments and Contingencies (See Note 10)

Net Assets
Preferred stock, $0.001 par value per share, 10,000,000,000 shares authorized, none issued and outstanding as of September 30, 2018 and December 31, 2017, respectively	$	—		$	—
Common stock, par value $0.001 per share, 100,000,000,000 and 100,000,000,000 shares authorized, 43,821,596 and 24,975,812 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively	43,822			24,976
Paid in capital in excess of par value	886,056,633			503,533,321
Accumulated undistributed net investment income	(9,374,536		)	(3,469,772		)
Accumulated undistributed net realized gain (loss)	(8,048,573		)	35,676
Net unrealized appreciation	15,283,884			6,838,627
Total Net Assets	883,961,230			506,962,828
Total Liabilities and Total Net assets	$	1,564,846,084		$	988,251,310

Net asset value per share	$	20.17		$	20.30

See Notes to Consolidated Financial Statements

Table of Contents

Bain Capital Specialty Finance, Inc.

Consolidated Statements of Operations

(Unaudited)

	For the Three Months Ended September 30,			For the Three Months Ended September 30,			For the Nine Months Ended September 30,			For the Nine Months Ended September 30,
	2018			2017			2018			2017
Income
Investment income from non-controlled/non-affiliate investments:
Interest from investments	$	20,270,439		$	7,793,040		$	48,706,718		$	14,467,794
Other income	91,436			—			299,641			88,988
Total investment income from non-controlled/non-affiliate investments	20,361,875			7,793,040			49,006,359			14,556,782
Investment income from controlled affiliate investments:
Interest from investments	96,271			24,060			194,898			31,906
Dividend income	6,204,262			—			16,345,224			—
Total investment income from controlled affiliate investments	6,300,533			24,060			16,540,122			31,906
Total investment income	26,662,408			7,817,100			65,546,481			14,588,688

Expenses
Interest and debt financing expenses	$	6,523,738		$	223,945		$	16,137,857		$	621,853
Amortization of deferred offering costs	—			106,152			—			314,995
Base management fee	2,319,541			856,260			5,821,384			1,704,975
Incentive fee	3,241,992			240,003			6,157,643			449,824
Professional fees	899,756			506,756			1,739,723			1,406,462
Directors fees	67,776			68,250			202,937			204,312
Other general and administrative expenses	329,917			213,822			954,327			500,313
Total expenses before fee waivers	13,382,720			2,215,188			31,013,871			5,202,734
Incentive fee waiver	(619,563		)	—			(1,623,761		)	—
Total expenses, net of fee waivers	12,763,157			2,215,188			29,390,110			5,202,734
Net investment income before taxes	13,899,251			5,601,912			36,156,371			9,385,954
Excise tax expense	—			—			309			—
Net investment income after taxes	13,899,251			5,601,912			36,156,062			9,385,954

Net realized and unrealized gains (losses)
Net realized gain (loss) on non-controlled/non-affiliate investments	(3,174,983		)	48,735			(5,020,860		)	81,336
Net realized gain (loss) on foreign currency transactions	(102,909		)	(583,149		)	(367,422		)	(2,104		)
Net realized gain (loss) on forward currency exchange contracts	177,172			—			(2,695,967		)	(220,006		)
Net change in unrealized appreciation (depreciation) on foreign currency translation	(17,216		)	448,252			(42,762		)	9,170
Net change in unrealized appreciation (depreciation) on forward currency exchange contracts	1,529,008			(1,234,706		)	9,123,101			(2,643,944		)
Net change in unrealized appreciation (depreciation) on non-controlled/non-affiliate investments	7,123,429			2,920,895			(2,197,073		)	5,774,373
Net change in unrealized appreciation (depreciation) on controlled affiliate investments	(442,900		)	—			1,561,991			—
Total net gains	5,091,601			1,600,027			361,008			2,998,825

Net increase in net assets resulting from operations	$	18,990,852		$	7,201,939		$	36,517,070		$	12,384,779

Per Common Share Data
Basic and diluted net investment income per common share	$	0.33		$	0.22		$	1.02		$	0.53
Basic and diluted increase in net assets resulting from operations per common share	$	0.46		$	0.29		$	1.03		$	0.70
Basic and diluted weighted average common shares outstanding	41,733,013			24,921,589			35,461,497			17,725,983

See Notes to Consolidated Financial Statements

Table of Contents

Bain Capital Specialty Finance, Inc.

Consolidated Statements of Changes in Net Assets

(Unaudited)

	For the Nine Months Ended September 30,			For the Nine Months Ended September 30,
	2018			2017

Operations:
Net investment income	$	36,156,062		$	9,385,954
Net realized loss	(8,084,249		)	(140,774		)
Net change in unrealized appreciation	8,445,257			3,139,599
Net increase in net assets resulting from operations	36,517,070			12,384,779
Stockholder distributions:
Distributions from net investment income	(42,060,826		)	(9,149,711		)
Net decrease in net assets resulting from stockholder distributions	(42,060,826		)	(9,149,711		)
Capital share transactions:
Issuance of common stock	376,948,118			392,735,221
Reinvestment of stockholder distributions	5,594,040			581,699
Net increase in net assets resulting from capital share transactions	382,542,158			393,316,920

Total increase in net assets	376,998,402			396,551,988
Net assets at beginning of period	506,962,828			110,344,258
Net assets at end of period	$	883,961,230		$	506,896,246

Net asset value per common share	$	20.17		$	20.33
Common stock outstanding at end of period	43,821,596			24,931,842

See Notes to Consolidated Financial Statements

Table of Contents

Bain Capital Specialty Finance, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

	For the Nine Months Ended September 30,			For the Nine Months Ended September 30,
	2018			2017
Cash flows from operating activities
Net increase in net assets resulting from operations	$	36,517,070		$	12,384,779
Adjustments to reconcile net increase in net assets from operations to net cash used in operating activities:
Purchases of investments	(675,406,574		)	(390,313,756		)
Proceeds from principal payments and sales of investments	195,036,259			26,029,281
Net realized (gain) loss from investments	5,020,860			(81,336		)
Net realized (gain) loss on foreign currency transactions	367,422			2,104
Net change in unrealized (appreciation) depreciation on forward currency exchange contracts	(9,123,101		)	2,643,944
Net change in unrealized (appreciation) depreciation on investments	635,082			(5,774,373		)
Net change in (appreciation) depreciation on foreign currency translation	42,762			(9,170		)
Accretion of discounts and amortization of premiums	(1,255,921		)	(538,677		)
Amortization of deferred financing costs and debt issuance costs	1,073,517			273,692
Amortization of deferred offering costs	—			314,995
Changes in operating assets and liabilities:
Collateral on forward currency exchange contracts	3,597,777			(4,220,000		)
Interest receivable on investments	(1,593,339		)	(1,199,757		)
Prepaid insurance	134,752			137,797
Distribution receivable	(61,101		)	—
Dividend receivable	(6,084,313		)	—
Other assets	—			5,723
Interest payable	(216,600		)	53,308
Base management fee payable	1,075,508			678,056
Incentive fee payable	1,912,841			449,824
Accounts payable and accrued expenses	908,727			746,158
Excise tax payable	(4,882		)	—
Net cash used in operating activities	(447,423,254		)	(358,417,408		)

Cash flows from financing activities
Borrowings on revolving credit facilities	270,000,000			94,899,918
Repayments on revolving credit facilities	(487,360,750		)	(154,563,966		)
Issuance of 2018-1 Notes	365,700,000			—
Payments of debt issuance costs	(1,682,500		)	—
Proceeds from issuance of common stock	376,948,118			392,735,221
Stockholder distributions paid	(26,242,433		)	(3,414,688		)
Net cash provided by financing activities	497,362,435			329,656,485

Net increase (decrease) in cash, foreign cash, restricted cash and cash equivalents	49,939,181			(28,760,923		)
Effect of foreign currency exchange rates	(385,436		)	570,895
Cash, foreign cash, restricted cash and cash equivalents, beginning of period	140,918,144			66,732,154
Cash, foreign cash, restricted cash and cash equivalents, end of period	$	190,471,889		$	38,542,126

Supplemental disclosure of cash flow information:
Cash interest paid during the period	$	15,280,940		$	294,853
Cash paid for excise taxes during the period	$	5,191		$	—
Supplemental disclosure of non-cash information:
Reinvestment of stockholder distributions	$	5,594,040		$	581,699

	As of September 30,
	2018		2017
Cash and cash equivalents	$	151,069,731	$	37,813,409
Restricted cash	37,735,920		—
Foreign cash	1,666,238		728,717
Total cash, foreign cash, restricted cash, and cash equivalents shown in the consolidated statements of cash flows	$	190,471,889	$	38,542,126

See Notes to Consolidated Financial Statements

Table of Contents

Bain Capital Specialty Finance, Inc.

Consolidated Schedule of Investments

As of September 30, 2018

(Unaudited)

Portfolio Company (4)	Spread Above Index (1)	Interest Rate		Maturity Date	Principal/ Par Amount/ Shares (9)		Amortized Cost			Fair Value
Investments and Cash Equivalents 169.7%
Investments 152.9%
Non-Controlled/Non-Affiliate Investments 121.7%
Corporate Fixed Income 3.8%
Corporate Bond 3.8%
Beverage, Food & Tobacco 1.1%
Hearthside Food Solutions, LLC	—	8.50	%	6/1/2026	$	10,000,000	9,788,101			9,775,000
Total Beverage, Food & Tobacco							9,788,101			9,775,000
Consumer Goods: Non-Durable 1.1%
Kronos Acquisition Holdings Inc.	—	9.00	%	8/15/2023	$	10,000,000	9,329,382			9,450,000
Total Consumer Goods: Non-Durable							9,329,382			9,450,000
Containers, Packaging & Glass 0.6%
BWAY Holding Company	—	7.25	%	4/15/2025	$	5,000,000	4,895,579			4,887,000
Total Containers, Packaging & Glass							4,895,579			4,887,000
Utilities: Electric 1.0%
CSVC Acquisition Corp	—	7.75	%	6/15/2025	$	10,478,000	$	9,885,536		$	9,063,470
Total Utilities: Electric							9,885,536			9,063,470
Total Corporate Bond							$	33,898,598		$	33,175,470
Total Corporate Fixed Income							$	33,898,598		$	33,175,470

Corporate Debt 117.1%
Delayed Draw Term Loan 0.8%
Capital Equipment 0.4%
Endries International, Inc. (3) (15) (19) (28)	L+ 4.75%	8.60	%	6/1/2023	$	3,222,455	3,183,938			3,222,455
Total Capital Equipment							3,183,938			3,222,455
Construction & Building 0.0%
Chase Industries, Inc. (3) (15) (19) (21)	L+ 4.00%	6.38	%	5/12/2025	$	199,683	181,790			190,322
Total Construction & Building							181,790			190,322
High Tech Industries 0.0%
Drilling Info Holdings, Inc. (2) (3) (5) (18) (21) (29)	—	—		7/30/2025	$	—	(13,653		)	(7,604		)
Total High Tech Industries							(13,653		)	(7,604		)
Services: Business 0.4%
AMCP Clean Acquisition Company, LLC (3) (5) (18) (21) (29)	—	—		6/16/2025	$	—	(2,266		)	11,155
Sovos Compliance, LLC (3) (15) (19)	L+ 6.00%	8.24	%	3/1/2022	$	3,967,742	3,967,742			3,919,355
Total Services: Business							3,965,476			3,930,510
Telecommunications 0.0%
Horizon Telcom, Inc. (2) (3) (5) (15) (19) (21) (29)	—	—		6/15/2023	$	—	(20,486		)	(26,069		)
Total Telecommunications							(20,486		)	(26,069		)
Transportation: Cargo 0.0%
ENC Holding Corporation (3) (5) (18) (21)	—	—		5/30/2025	$	—	(1,152		)	1,202
Transportation: Cargo							(1,152		)	1,202
Total Delayed Draw Term Loan							$	7,295,913		$	7,310,816

First Lien Last Out Term Loan 3.4%
Environmental Industries 2.2%
Adler & Allan Group Limited (6) (17) (19) (21) (22)	GBP LIBOR+ 7.50%	8.30	%	6/30/2024	£	15,141,463	19,098,906			19,533,532

Table of Contents


Total Environmental Industries							19,098,906		19,533,532
Healthcare & Pharmaceuticals 1.2%
Clinical Innovations, LLC (15) (19) (21) (22) (29)	L+ 6.00%	8.24	%	10/17/2023	$	10,287,776	10,086,251		10,287,776
Total Healthcare & Pharmaceuticals							10,086,251		10,287,776
Total First Lien Last Out Term Loan							$	29,185,157	$	29,821,308

First Lien Senior Secured Loan 84.8%
Aerospace & Defense 4.4%
Novetta, LLC (15) (29)	L+ 5.00%	7.25	%	10/17/2022	$	3,824,541	3,759,269		3,714,585
Salient CRGT, Inc. (15) (19) (21) (29)	L+ 5.75%	7.99	%	2/28/2022	$	10,177,315	10,256,880		10,329,974
StandardAero Aviation Holdings, Inc. (15) (21) (29)	L+ 3.75%	5.99	%	7/7/2022	$	19,822,009	19,924,605		19,963,597
WP CPP Holdings, LLC (15) (21) (29)	L+ 3.75%	6.21	%	4/30/2025	$	4,726,842	4,715,025		4,763,277
Total Aerospace & Defense							38,655,779		38,771,433
Automotive 2.0%
CST Buyer Company (15) (19) (29)	L+ 5.00%	7.39	%	3/1/2023	$	9,456,999	9,348,011		9,456,999
OEConnection LLC (15) (19)(29)	L+ 4.00%	6.25	%	11/22/2024	$	8,114,461	8,082,139		8,155,033
Total Automotive							17,430,150		17,612,032
Beverage, Food & Tobacco 0.6%
Restaurant Technologies, Inc. (15) (21) (24)	P+ 3.75%	9.00	%	11/23/2022	$	5,226,855	5,188,358		5,223,588
Total Beverage, Food & Tobacco							5,188,358		5,223,588
Capital Equipment 2.8%
Dorner Manufacturing Corp. (15) (19) (29)	L+ 5.75%	8.14	%	3/15/2023	$	8,226,236	8,064,566		8,226,236
DXP Enterprises, Inc. (6) (15) (19) (29)	L+ 4.75%	6.99	%	8/29/2023	$	5,191,025	5,145,731		5,249,424
Endries International, Inc. (15) (19) (29)	L+ 4.75%	6.90	%	6/1/2023	$	6,491,144	6,412,625		6,491,144
Wilsonart LLC (15) (29)	L+ 3.25%	5.64	%	12/19/2023	$	5,432,487	5,485,009		5,461,589
Total Capital Equipment							25,107,931		25,428,393
Chemicals, Plastics & Rubber 0.9%
ASP Chromaflo Intermediate Holdings, Inc. (15) (21)	L+ 3.50%	5.74	%	11/20/2023	$	506,127	504,253		511,188
ASP Chromaflo Intermediate Holdings, Inc. (6) (15) (21)	L+ 3.50%	5.47	%	11/20/2023	$	658,126	655,690		663,062
Niacet b.v. (6) (15) (19) (21)	EURIBOR+ 4.50%	5.50	%	2/1/2024	€	3,784,641	4,050,495		4,391,698
Niacet Corporation (15) (19) (29)	L+ 4.50%	6.74	%	2/1/2024	$	2,176,868	2,159,852		2,176,868
Total Chemicals, Plastics & Rubber							7,370,290		7,742,816
Construction & Building 3.3%
Bolt Infrastructure Merger Sub, Inc. (15) (29)	L+ 3.50%	5.74	%	6/21/2024	$	2,677,183	2,665,575		2,686,387
Chase Industries, Inc. (15) (19) (21) (29)	L+ 4.00%	6.34	%	5/11/2025	$	11,980,952	11,921,516		11,951,000
Regan Development Holdings Limited (6) (17) (19)	EURIBOR+ 7.00%	7.50	%	4/18/2022	€	2,825,002	3,077,840		3,278,132
Regan Development Holdings Limited (6) (17) (19)	EURIBOR+ 7.00%	7.50	%	4/18/2022	€	8,574,506	9,192,274		9,949,856
Regan Development Holdings Limited (6) (17) (19)	EURIBOR+ 7.00%	7.50	%	4/18/2022	€	915,945	1,040,239		1,062,863
Total Construction & Building							27,897,444		28,928,238
Consumer Goods: Durable 2.0%
New Milani Group LLC (15) (19) (21) (29)	L+ 4.25%	6.37	%	6/6/2024	$	17,360,000	17,191,675		17,360,000
Total Consumer Goods: Durable							17,191,675		17,360,000
Consumer Goods: Non-Durable 4.9%
FineLine Technologies, Inc. (15) (19) (21) (29)	L+ 4.25%	6.63	%	11/2/2022	$	31,782,763	31,539,017		31,623,850
Kronos Acquisition Holdings Inc. (15) (21) (29)	L+ 4.00%	6.24	%	5/15/2023	$	8,181,476	8,135,936		8,153,349
MND Holdings III Corp (15) (21)	L+ 3.50%	5.89	%	6/19/2024	$	3,801,806	3,787,264		3,830,319
Total Consumer Goods: Non-Durable							43,462,217		43,607,518
Containers, Packaging & Glass 3.4%
BWAY Holding Company (18) (21) (29)	L+ 3.25%	5.58	%	4/3/2024	$	12,844,925	12,867,847		12,852,953
Technimark LLC (18)(29)	L+ 3.75%	5.88	%	8/8/2025	$	2,826,456	2,822,923		2,835,288
Terminator Bidco AS (6) (18) (19) (21)	L+ 5.00%	7.34	%	5/22/2022	$	15,100,000	14,780,468		14,760,250
Total Containers, Packaging & Glass							30,471,238		30,448,491
Energy: Electricity 2.3%
Infinite Electronics International Inc. (18) (19) (21) (29)	L+ 4.00%	6.24	%	7/2/2025	$	20,003,129	19,987,728		19,987,387

Table of Contents


Total Energy: Electricity								19,987,728	19,987,387
Energy: Oil & Gas 3.5%
Blackbrush Oil & Gas, L.P. (15) (19) (21) (29)	L+ 8.00%	10.50	%	2/9/2024	$	31,200,000		30,648,829	30,731,999
Total Energy: Oil & Gas								30,648,829	30,731,999
FIRE: Finance 0.4%
Badger Merger Sub, Inc. (18) (29)	L+ 3.75%	5.90	%	8/8/2025	$	3,650,904		3,632,649	3,664,595
Total FIRE: Finance								3,632,649	3,664,595
Healthcare & Pharmaceuticals 3.0%
Datix Bidco Limited (6) (18) (19) (21)	BBSW+ 4.50%	6.65	%	4/28/2025	AUD		4,211,615	3,197,418	2,989,227
Drive DeVilbiss (15) (29)	L+ 5.50%	7.89	%	1/3/2023	$	6,584,955		6,134,695	6,206,320
Great Expressions Dental Centers PC (15) (19) (29)	L+ 4.75%	6.99	%	9/28/2023	$	8,002,680		7,913,850	7,882,640
Island Medical Management Holdings, LLC (15) (19) (21)	L+ 6.50%	8.74	%	9/1/2022	$	9,294,318		9,179,562	8,643,715
U.S. Anesthesia Partners, Inc. (15) (29)	L+ 3.00%	5.24	%	6/24/2024	$	1,172,458		1,168,492	1,180,702
Total Healthcare & Pharmaceuticals								27,594,017	26,902,604
High Tech Industries 17.0%
CMI Marketing Inc (15) (19) (21) (29)	L+ 5.00%	7.21	%	5/24/2024	$	15,449,280		15,300,071	15,449,280
Drilling Info Holdings, Inc. (18) (21) (29)	L+ 4.25%	6.54	%	7/30/2025	$	18,846,290		18,759,824	18,822,732
Lighthouse Network, LLC (15) (21) (29)	L+ 4.50%	6.84	%	12/2/2024	$	16,129,009		16,064,812	16,290,299
Netsmart Technologies, Inc.(15) (21) (29)	L+ 3.75%	5.99	%	4/19/2023	$	21,678,078		21,712,744	21,840,664
Park Place Technologies (15) (29)	L+ 4.00%	6.24	%	3/31/2025	$	9,848,967		9,815,640	9,865,385
Qlik Technologies (15) (21) (29)	L+ 3.50%	5.99	%	4/26/2024	$	17,782,425		17,706,277	17,782,424
SolarWinds Holdings, Inc. (18) (21)	L+ 3.00%	5.24	%	2/5/2024	$	14,800,376		14,885,646	14,897,496
VPARK BIDCO AB (6) (16) (19) (21)	CIBOR+ 5.00%	5.75	%	3/8/2025	DKK		56,999,385	9,126,347	8,870,395
VPARK BIDCO AB (6) (16) (19) (21)	NIBOR+ 5.00%	6.11	%	3/8/2025	NOK		74,019,870	9,178,545	9,077,515
Zywave, Inc. (15) (19) (21) (29)	L+ 5.00%	7.34	%	11/17/2022	$	17,582,974		17,493,987	17,582,974
Total High Tech Industries								150,043,893	150,479,164
Hotel, Gaming & Leisure 6.3%
Aimbridge Hospitality LP (15) (19) (21)	L+ 5.00%	7.24	%	6/22/2022	$	25,648,524		25,293,988	25,648,524
Aimbridge Hospitality LP (15) (19) (21) (29)	L+ 5.00%	7.24	%	6/22/2022	$	4,274,769		4,213,578	4,274,769
Captain D’s LLC (15) (19) (21) (29)	L+ 4.50%	6.71	%	12/15/2023	$	13,422,572		13,304,704	13,321,902
Quidditch Acquisition, Inc. (15) (19) (21) (29)	L+ 7.00%	9.17	%	3/21/2025	$	10,943,465		10,837,675	11,134,975
Tacala Investment Corp. (18) (29)	L+ 3.25%	5.49	%	1/31/2025	$	1,512,697		1,509,193	1,521,915
Total Hotel, Gaming & Leisure								55,159,138	55,902,085
Insurance 1.6%
Alliant Holdings Intermediate, LLC (18) (21) (29)	L+ 3.00%	5.15	%	5/9/2025	$	11,639,708		11,700,328	11,677,572
Wink Holdco, Inc. (15) (29)	L+ 3.00%	5.24	%	12/2/2024	$	2,606,076		2,601,467	2,602,006
Total Insurance								14,301,795	14,279,578
Media: Broadcasting & Subscription 1.9%
Micro Holding Corp. (18) (21) (29)	L+ 3.75%	5.92	%	9/13/2024	$	16,986,978		16,953,518	17,129,550
Total Media: Broadcasting & Subscription								16,953,518	17,129,550
Media: Diversified & Production 1.3%
International Entertainment Investments Limited (6) (18) (19) (21)	GBP LIBOR+ 4.75%	5.48	%	05/31/2023	£	8,685,518		10,620,959	11,318,099
Total Media: Diversified & Production								10,620,959	11,318,099
Real Estate 1.2%
Spectre (Carrisbrook House) Limited (6) (15) (19)	EURIBOR+ 7.50%	8.50	%	8/9/2021	€	9,300,000		10,693,059	10,791,720
Total Real Estate								10,693,059	10,791,720
Retail 3.2%
CH Hold Corp. (15) (29)	L+ 3.00%	5.24	%	2/1/2024	$	1,502,194		1,499,673	1,513,460
CVS Holdings I, LP (15) (21) (29)	L+ 3.00%	5.25	%	2/6/2025	$	14,949,937		14,929,809	14,984,203
Eyemart Express LLC (15) (21) (29)	L+ 3.00%	5.19	%	8/5/2024	$	11,534,811		11,573,503	11,596,084
Total Retail								28,002,985	28,093,747
Services: Business 10.0%
Advantage Sales & Marketing Inc. (15) (21) (29)	L+ 3.25%	5.49	%	7/23/2021	$	15,784,298		15,518,321	14,616,260

Table of Contents


AMCP Clean Acquisition Company, LLC (18) (21) (29)	L+ 4.25%	6.64	%	6/16/2025	$	10,597,097	10,565,258			10,643,459
Comet Bidco Limited (6) (18)	GBP LIBOR+ 5.25%	5.97	%	9/30/2024	£	6,260,870	8,051,481			8,038,707
Lakeland Tours, LLC (15) (29)	L+ 4.00%	6.33	%	12/16/2024	$	2,894,455	2,885,298			2,923,414
New Insight Holdings, Inc. (15) (21) (29)	L+ 5.50%	7.74	%	12/20/2024	$	15,580,858	15,090,652			15,683,100
Sovos Compliance, LLC (15) (19) (29)	L+ 6.00%	8.24	%	3/1/2022	$	8,622,578	8,556,075			8,536,352
Valet Waste Holdings, Inc. (18) (19)	L+ 4.00%	6.32	%	9/27/2025	$	27,583,423	27,514,465			27,721,340
Total Services: Business							88,181,550			88,162,632
Services: Consumer 1.9%
GI Chill Acquisition LLC (18) (19) (21) (29)	L+ 4.00%	6.39	%	8/6/2025	$	11,492,287	11,467,638			11,571,584
Travel Leaders Group, LLC (18) (29)	L+ 4.00%	6.16	%	1/25/2024	$	529,294	527,971			536,241
Trident LS Merger Sub Corp (18) (29)	L+ 3.25%	5.49	%	5/1/2025	$	4,231,296	4,218,649			4,262,370
Total Services: Consumer							16,214,258			16,370,195
Telecommunications 1.6%
Horizon Telcom, Inc. (15) (19) (21) (29)	L+ 4.50%	6.67	%	6/15/2023	$	13,903,448	13,738,518			13,694,897
Masergy Holdings, Inc. (15) (21)	L+ 3.25%	5.64	%	12/15/2023	$	687,865	685,333			689,871
Total Telecommunications							14,423,851			14,384,768
Transportation: Cargo 2.0%
ENC Holding Corporation (18) (27) (29)	L+ 4.25%	6.64	%	5/30/2025	$	7,913,706	7,894,643			7,933,490
PS HoldCo, LLC (15) (21) (29)	L+ 5.25%	7.40	%	3/13/2025	$	9,376,364	9,336,761			9,417,385
Total Transportation: Cargo							17,231,404			17,350,875
Wholesale 3.3%
PT Holdings, LLC (15) (21) (29)	L+ 4.00%	6.39	%	12/9/2024	$	21,725,966	21,687,899			21,766,702
Specialty Building Products Holdings, LLC (18) (29)	L+ 5.75%	8.06	%	4/30/2026	$	6,944,043	6,839,882			6,979,839
Total Wholesale							28,527,781			28,746,541
Total First Lien Senior Secured Loan							$	744,992,496		$	749,418,048

Revolver 1.0%
Aerospace & Defense 0.0%
API Technologies Corp. (2) (3) (5) (15) (19)	—	—		4/22/2024	$	—	(48,477		)	(20,916		)
Total Aerospace & Defense							(48,477		)	(20,916		)
Automotive 0.0%
CST Buyer Company (3) (5) (15) (19)	—	—		3/1/2023	$	—	(9,914		)	—
Total Automotive							(9,914		)	—
Banking 0.0%
Tidel Engineering, L.P. (3) (15) (19)	—	—		3/1/2023	$	—	—			—
Total Banking							—			—
Capital Equipment 0.2%
Abracon Group Holding, LLC (2) (3) (5) (15) (19)	—	—		7/18/2024	$	—	(41,112		)	(28,334		)
Aramsco, Inc. (3) (15) (19) (26)	L+ 5.25%	7.91	%	8/28/2024	$	1,072,486	1,022,275			1,021,684
Dorner Manufacturing Corp. (3) (5) (15) (19)	—	—		3/15/2022	$	—	(20,535		)	—
Endries International, Inc. (3) (15) (19)	P+ 3.75%	9.00	%	6/1/2022	$	773,413	737,243			773,413
Winchester Electronics Corporation (3) (18) (19)	—	—		6/30/2021	$	—	—			—
Total Capital Equipment							1,697,871			1,766,763
Chemicals, Plastics & Rubber 0.0%
AP Plastics Group, LLC (3) (15) (19)	—	—		8/1/2021	$	—	—			—
PRCC Holdings, Inc. (3) (15) (19)	—	—		2/1/2021	$	—	—			—
Total Chemicals, Plastics & Rubber							—			—
Construction & Building 0.0%
Stanton Carpet Corp. (3) (15) (19)	—	—		11/21/2022	$	—	—			—
Total Construction & Building							—			—
Consumer Goods: Durable 0.0%
Home Franchise Concepts, Inc. (2) (3) (5) (15) (19)	—	—		7/9/2024	$	—	(17,001		)	(25,298		)
Total Consumer Goods: Durable							(17,001		)	(25,298		)
Consumer Goods: Non-Durable 0.1%

Table of Contents

FineLine Technologies, Inc. (3) (15) (19)	L+ 4.75%	7.09	%	11/2/2021	$	655,181	618,715			642,077
Solaray, LLC (3) (15) (19)	L+ 4.50%	6.84	%	9/9/2022	$	425,010	425,010			425,010
Total Consumer Goods: Non-Durable							1,043,725			1,067,087
Energy: Oil & Gas 0.0%
Amspec Services, Inc. (3) (5) (15) (19)	—	—		7/2/2024	$	—	(68,536		)	—
Total Energy: Oil & Gas							(68,536		)	—
Healthcare & Pharmaceuticals 0.2%
Clinical Innovations, LLC (3) (15) (19) (22)	L+ 6.00%	7.31	%	10/17/2022	$	575,862	554,901			575,862
Datix Bidco Limited (2) (3) (5) (6) (18) (19)	—	—		10/28/2024	£	—	(26,144		)	(22,177		)
Great Expressions Dental Centers PC (3) (12) (15) (19)	L+ 4.75%	8.13	%	9/28/2022	$	616,843	605,108			599,338
Total Healthcare & Pharmaceuticals							1,133,865			1,153,023
High Tech Industries 0.0%
CMI Marketing Inc (3) (5) (15) (19)	—	—		5/24/2023	$	—	(19,660		)	—
Zywave, Inc. (3) (15) (19) (23)	L+ 5.00%	8.94	%	11/17/2022	$	95,934	82,704			95,934
Total High Tech Industries							63,044			95,934
Hotel, Gaming & Leisure 0.1%
Aimbridge Hospitality LP (3) (5) (15) (19)	—	—		6/22/2022	$	—	(15,899		)	—
Captain D’s LLC (3) (15) (19)	L+ 4.50%	7.86	%	12/15/2023	$	751,116	734,947			737,149
Total Hotel, Gaming & Leisure							719,048			737,149
Media: Advertising, Printing & Publishing 0.2%
Ansira Holdings, Inc. (3)(15)(19)	P+ 3.25%	8.50	%	12/20/2022	$	1,643,372	1,643,372			1,643,372
Cruz Bay Publishing (3)(15)(19)	—	—		6/6/2019	$	—	—			—
Total Media: Advertising, Printing & Publishing							1,643,372			1,643,372
Media: Diversified & Production 0.0%
Efficient Collaborative Retail Marketing Company, LLC (3) (15) (19)	—	—		6/15/2022	$	—	—			—
Total Media: Diversified & Production							—			—
Retail 0.0%
Batteries Plus Holding Corporation (3) (15) (19)	—	—		7/6/2022	$	—	—			—
Total Retail							—			—
Services: Business 0.2%
Element Buyer, Inc. (2) (3) (5) (15) (19)	—	—		7/19/2024	$	—	(61,696		)	(10,625		)
McKissock, LLC (3) (15) (19)	P+ 2.25%	7.50	%	8/5/2021	$	991,690	991,690			991,690
Sovos Compliance, LLC (2) (3) (5) (15) (19)	—	—		3/1/2022	$	—	(10,833		)	(14,516		)
TEI Holdings Inc. (3) (13) (15) (19)	L+ 6.00%	8.16	%	12/20/2022	$	1,133,360	1,133,360			1,133,360
Total Services: Business							2,052,521			2,099,909
Telecommunications 0.0%
Horizon Telcom, Inc. (2) (3) (15) (19)	—	—		6/15/2023	$	—	—			(17,379		)
Total Telecommunications							—			(17,379		)
Transportation: Consumer 0.0%
Direct Travel, Inc. (3) (15) (19)	—	—		12/1/2021	$	—	—			—
Total Transportation: Consumer							—			—
Total Revolver							$	8,209,518		$	8,499,644

Second Lien Senior Secured Loan 24.3%
Aerospace & Defense 3.0%
TECT Power Holdings, LLC (15) (19) (21)	L+ 8.50%	10.74	%	12/27/2021	$	14,757,969	14,534,773			14,905,549
WP CPP Holdings, LLC (15) (21) (29)	L+ 7.75%	10.15	%	4/30/2026	$	11,723,622	11,608,507			11,757,820
Total Aerospace & Defense							26,143,280			26,663,369
Automotive 0.7%
OEConnection LLC (15) (19) (21)	L+ 8.00%	10.25	%	11/24/2025	$	6,312,688	6,276,140			6,312,688
Total Automotive							6,276,140			6,312,688
Beverage, Food & Tobacco 0.2%

Table of Contents

Restaurant Technologies, Inc. (15) (19) (21)	P+ 7.75%	13.00	%	11/23/2023	$	1,693,548	1,666,409		1,685,081
Total Beverage, Food & Tobacco							1,666,409		1,685,081
Capital Equipment 1.7%
EXC Holdings III Corp. (15) (21) (29)	L+ 7.50%	9.97	%	12/1/2025	$	8,240,489	8,254,837		8,384,697
Velvet Acquisition B.V. (6) (18) (19) (21)	EURIBOR+ 8.00%	8.01	%	4/17/2026	€	6,013,072	7,306,339		7,047,344
Total Capital Equipment							15,561,176		15,432,041
Energy: Electricity 0.3%
Infinite Electronics International Inc. (18) (19) (21)	L+ 8.00%	10.24	%	7/2/2026	$	2,480,000	2,432,230		2,430,400
Total Energy: Electricity							2,432,230		2,430,400
Healthcare & Pharmaceuticals 6.3%
Concentra Inc. (15) (21) (29)	L+ 6.50%	8.61	%	6/1/2023	$	14,104,833	13,850,499		14,316,406
Datix Bidco Limited (6) (18) (19) (21)	GBP LIBOR+ 7.75%	8.54	%	4/27/2026	£	12,133,975	16,268,416		15,495,547
TecoStar Holdings, Inc. (15) (19) (21) (29)	L+ 8.50%	10.62	%	11/1/2024	$	9,471,942	9,260,060		9,471,942
U.S. Anesthesia Partners, Inc. (15) (19) (21) (29)	L+ 7.25%	9.49	%	6/23/2025	$	16,520,000	16,303,982		16,520,000
Total Healthcare & Pharmaceuticals							55,682,957		55,803,895
High Tech Industries 4.3%
Everest Bidco (6) (19) (21)	L+ 7.50%	8.50	%	7/3/2026	$	10,216,216	13,055,567		12,913,369
Intralinks, Inc. (15) (21)	L+ 8.00%	10.25	%	11/14/2025	$	8,775,510	8,699,997		8,870,575
nThrive, Inc. (15) (19) (21)	L+ 9.75%	11.99	%	4/20/2023	$	8,000,000	7,983,386		7,840,000
Netsmart Technologies, Inc. (15) (21)	L+ 7.50%	9.84	%	10/19/2023	$	2,749,000	2,749,000		2,735,255
Park Place Technologies (15) (19) (21)	L+ 8.00%	10.24	%	3/30/2026	$	5,536,332	5,485,191		5,522,491
Total High Tech Industries							37,973,141		37,881,690
Hotel, Gaming & Leisure 1.9%
K-Mac Holdings Corp. (18) (29)	L+ 6.75%	8.92	%	3/16/2026	$	3,200,000	3,192,384		3,224,000
NPC International, Inc. (15) (21) (29)	L+ 7.50%	9.58	%	4/18/2025	$	9,158,667	9,195,778		9,273,151
Tacala Investment Corp. (18) (21)	L+ 7.00%	9.24	%	1/30/2026	$	4,323,404	4,304,655		4,393,660
Total Hotel, Gaming & Leisure							16,692,817		16,890,811
Insurance 1.2%
Wink Holdco, Inc. (15) (21)	L+ 6.75%	9.00	%	12/1/2025	$	10,587,543	10,600,756		10,587,543
Total Insurance							10,600,756		10,587,543
Media: Advertising, Printing & Publishing 0.5%
Learfield Communications LLC (15) (19) (21) (29)	L+ 7.25%	9.50	%	12/2/2024	$	4,050,000	4,015,477		4,090,500
Total Media: Advertising, Printing & Publishing							4,015,477		4,090,500
Retail 1.4%
CH Hold Corp. (15) (19) (29)	L+ 7.25%	9.49	%	2/3/2025	$	1,215,470	1,210,558		1,233,702
CVS Holdings I, LP (15) (21)	L+ 6.75%	9.00	%	2/6/2026	$	11,133,301	11,137,639		11,098,509
Total Retail							12,348,197		12,332,211
Services: Consumer 0.5%
Pearl Intermediate Parent LLC (18) (21)	L+ 6.25%	8.42	%	2/13/2026	$	2,570,811	2,590,063		2,567,597
Trident LS Merger Sub Corp (18) (29)	L+ 7.50%	9.74	%	5/1/2026	$	2,246,470	2,224,926		2,268,935
Total Services: Consumer							4,814,989		4,836,532
Telecommunications 0.1%
Masergy Holdings, Inc. (15)	L+ 7.50%	9.89	%	12/16/2024	$	857,143	863,498		860,715
Total Telecommunications							863,498		860,715
Transportation: Cargo 2.2%
Direct ChassisLink, Inc. (18) (19) (21) (29)	L+ 6.00%	8.24	%	6/15/2023	$	19,031,936	19,087,274		19,246,045
Total Transportation: Cargo							19,087,274		19,246,045
Total Second Lien Senior Secured Loan							$	214,158,341	$	215,053,521

Subordinated Debt 2.8%
Healthcare & Pharmaceuticals 1.1%

Table of Contents

Genesis Supply Acquisition Co. (19)	—	12.50	%	4/23/2021	$	10,000,000	10,000,000		10,000,000
Total Healthcare & Pharmaceuticals							10,000,000		10,000,000
Transportation: Cargo 1.7%
Omni Logistics, LLC (15) (19) (21)	L+ 11.50%	13.74	%	1/19/2024	$	15,000,000	14,702,741		14,700,000
Total Transportation: Cargo							14,702,741		14,700,000
Total Subordinated Debt							$	24,702,741	$	24,700,000
Total Corporate Debt							$	1,028,544,166	$	1,034,803,337

Equity 0.8%
Series A Preferred Units 0.2%
Healthcare & Pharmaceuticals 0.2%
CB Titan Holdings, Inc. (14) (19) (25)	—	—		—		1,952,879	1,952,879		2,070,053
Total Healthcare & Pharmaceuticals							1,952,879		2,070,053
Total Series A Preferred Units							1,952,879		2,070,053
Equity Interest 0.6%
High Tech Industries 0.3%
Impala Private Investments, LLC (14) (19) (25)	—	—		—		1,500,000	1,500,000		2,985,570
Total High Tech Industries							1,500,000		2,985,570
Capital Equipment 0.3%
Abracon Group Holding, LLC (14) (19) (25)	—	—		—	1,800		1,800,000		1,886,400
Armor Group, LP (14) (19) (25)	—	—		—	10,119		1,011,905		1,011,900
Total Capital Equipment							2,811,905		2,898,300
Total Equity Interest							4,311,905		5,883,870
Total Equity							$	6,264,784	$	7,953,923
Total Non-Controlled/Non-Affiliate Investments							$	1,068,707,548	$	1,075,932,730

Controlled Affiliate Investments 31.2%
Corporate Debt 0.5%
First Lien Senior Secured Loan 0.5%
Aerospace & Defense 0.5%
BCC Jetstream Holdings Aviation (On II), LLC (10) (11) (19) (20)		10.00	%	6/2/2022	$	4,144,528	4,144,528		4,144,528
Total Aerospace & Defense							4,144,528		4,144,528
Total First Lien Senior Secured Loan							$	4,144,528	$	4,144,528
Total Corporate Debt							$	4,144,528	$	4,144,528

Equity 30.7%
Equity Interest 1.4%
Aerospace & Defense 1.4%
BCC Jetstream Holdings Aviation (On II), LLC (10) (11) (19) (20) (25)	—	—		—		731,387	731,387		1,437,840
BCC Jetstream Holdings Aviation (Off I), LLC (6) (10) (11) (19) (20) (25)	—	—		—		11,862,614	11,862,614		11,295,145
Total Aerospace & Defense							12,594,001		12,732,985
Total Equity Interest							$	12,594,001	$	12,732,985
Investment Vehicles 29.3%
Antares Bain Capital Complete Financing Solution LLC (6) (10) (11) (19) (25)	—	—		—		256,316,439	256,316,439		258,632,338
Total Investment Vehicles							$	256,316,439	$	258,632,338
Total Equity							$	268,910,440	$	271,365,323

Unfunded Commitment 0.0%
Aerospace & Defense 0.0%
BCC Jetstream Holdings Aviation (On II), LLC (7) (10) (11) (14) (19) (20)	—	—		6/2/2022	—		—		—
Total Aerospace & Defense							—		—
Total Unfunded Commitment							—		—

Total Controlled Affiliate Investments							$	273,054,968	$	275,509,851

Table of Contents

Total Investments						$	1,341,762,516	$	1,351,442,581
Cash Equivalents 16.8%
Goldman Sachs Financial Square Government Fund Institutional Share Class	—	2.06	%	—	—	148,411,966		148,411,966
Total Cash Equivalents						$	148,411,966	$	148,411,966
Total Investments and Cash Equivalents						$	1,490,174,482	$	1,499,854,547

Forward Foreign Currency Exchange Contracts

Currency Purchased	Currency Sold	Counterparty	Settlement Date	Unrealized Appreciation (Depreciation) (8)
U.S. DOLLARS 8,720,000	POUND STERLING 6,400,000	Bank of New York Mellon	9/21/2020	$	58,275
U.S. DOLLARS 27,913,898	EURO 22,117,810	Bank of New York Mellon	1/18/2019	1,868,418
U.S. DOLLARS 11,541,188	POUND STERLING 8,262,000	Bank of New York Mellon	1/18/2019	445,074
U.S. DOLLARS 12,042,274	EURO 10,080,000	Bank of New York Mellon	6/21/2019	55,304
U.S. DOLLARS 109,279	AUSTRALIAN DOLLARS 145,482	Citibank	10/31/2018	3,970
U.S. DOLLARS 577,054	POUND STERLING 422,529	Citibank	10/31/2018	25,216
U.S. DOLLARS 9,497,034	DANISH KRONE 59,805,094	Citibank	1/18/2019	567,943
U.S. DOLLARS 9,622,663	NORWEGIAN KRONE 77,560,211	Citibank	1/18/2019	334,486
U.S. DOLLARS 3,169,087	AUSTRALIAN DOLLARS 4,127,383	Citibank	4/11/2019	81,710
U.S. DOLLARS 13,192,107	POUND STERLING 9,260,478	Citibank	4/11/2019	698,583
U.S. DOLLARS 3,577,812	POUND STERLING 2,630,000	Goldman Sachs	4/11/2019	114,353
U.S. DOLLARS 3,090,562	AUD 4,130,000	Goldman Sachs	6/14/2019	91,453
U.S. DOLLARS 8,937,749	DANISH KRONE 55,570,000	Goldman Sachs	6/14/2019	68,836
U.S. DOLLARS 11,718,855	EURO 9,790,000	Goldman Sachs	6/14/2019	84,103
U.S. DOLLARS 55,694,276	POUND STERLING 41,330,000	Goldman Sachs	6/14/2019	1,088,950
U.S. DOLLARS 8,993,793	NORWEGIAN KRONE 72,170,000	Goldman Sachs	6/14/2019	31,613
				$	5,618,287

(1) The investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (“LIBOR” or “L”), the Euro Interbank Offered Rate (“EURIBOR” or “E”), British Pound Sterling LIBOR Rate (“GBP LIBOR”), the Norwegian Interbank Offered Rate (“NIBOR” or “N”), the Copenhagen Interbank Offered Rate (“CIBOR” or “C”), the Bank Bill Swap Rate (“BBSW”) or the Prime Rate (“Prime” or “P”) and which reset daily, monthly, quarterly or semiannually. For each, the Company has provided the spread over LIBOR, EURIBOR, GBP LIBOR, NIBOR, CIBOR, BBSW or Prime and the current weighted average interest rate in effect at September 30, 2018. Certain investments are subject to a LIBOR, EURIBOR, GBP LIBOR, NIBOR, CIBOR, BBSW or Prime interest rate floor.

(2) The negative fair value is the result of the capitalized discount on the loan or the unfunded commitment being valued below par.

(3) Position or portion thereof is an unfunded loan commitment, and no interest is being earned on the unfunded portion. The investment may be subject to an unused/letter of credit facility fee.

(4) Percentages are based on the Company’s net assets of $883,961,230 as of September 30, 2018.

(5) The negative amortized cost is the result of the capitalized discount being greater than the principal amount outstanding on the loan.

(6) The investment is not a qualifying asset under Section 55(a) of the Investment Company Act of 1940. The Company may not acquire any non-qualifying asset unless, at the time of acquisition, qualifying assets represent at least 70% of the Company’s total assets. As of September 30, 2018, non-qualifying assets totaled 26.6% of the Company’s total assets.

(7) The assets to be issued will be determined at the time the funds are called.

(8) Unrealized appreciation/(depreciation) on forward currency exchange contracts.

(9) The principal amount (par amount) for all debt securities is denominated in U.S. dollars, unless otherwise noted. £ represents Pound Sterling, € represents Euro, NOK represents Norwegian krone, AUD represents Australian and DKK represents Kroner.

(10) As defined in the 1940 Act, the Company is deemed to be an “Affiliated Investment” of the Company as the Company owns five percent or more of the portfolio company’s securities.

(11) As defined in the 1940 Act, the Company is deemed to “Control” this portfolio company as the Company either 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.

(12) $353,434 of the total par amount for this security is at P + 3.75%.

(13) $434,530 of the total par amount for this security is at P + 3.75%.

(14) Non-Income Producing.

(15) Loan includes interest rate floor of 1.00%.

(16) Loan includes interest rate floor of 0.75%.

(17) Loan includes interest rate floor of 0.50%.

Table of Contents

(18) Loan includes interest rate floor of 0.00%.

(19) Security valued using unobservable inputs (Level 3).

(20) The Company holds non-controlling, affiliate interest in an aircraft-owning special purpose vehicle through this investment.

(21) Assets or a portion thereof are pledged as collateral for the BCSF Revolving Credit Facility. See Note 6 “Borrowings”.

(22) The Company generally earns a higher interest rate on the “last out” tranche of debt, to the extent the debt has been allocated to “first out” and “last out” tranches, whereby the “first out” tranche will have priority as to the “last out” tranche with respect to payments of principal, interest and any other amounts due thereunder.

(23) $351,758 of the total par amount for this security is at P+ 4.00%.

(24) $13,266 of the total par amount for this security is at P + 3.75%.

(25) Security exempt from registration under the Securities Act of 1933 (the “Securities Act”), and may be deemed to be “restricted securities” under the Securities Act. As of September 30, 2018, the aggregate fair value of these securities is $279,319,246 or 31.6% of the Company’s net assets. The acquisition dates of the restricted securities are as follows:

Investment		Acquisition Date
BCC Jetstream Holdings Aviation (On II), LLC		6/1/2017
BCC Jetstream Holdings Aviation (Off I), LLC		6/1/2017
Antares Bain Capital Complete Financing Solution LLC		11/29/2017
CB Titan Holdings, Inc.		11/14/2017
Impala Private Investments, LLC		11/10/2017
Abracon Group Holding, LLC		7/18/2018
Armor Group, LP		8/28/2018

(26) $225,787 of the total par amount for this security is at P + 4.25%.

(27) $19,834 of the total par amount for this security is at P + 3.75%.

(28) $2,525,067 of the total par amount for this security is at P + 3.75%.

(29) Assets or a portion thereof are pledged as collateral for the 2018-1 Issuer. See Note 6 “Borrowings”.

See Notes to Consolidated Financial Statements.

Table of Contents

Bain Capital Specialty Finance, Inc.

Consolidated Schedule of Investments

As of December 31, 2017

					Principal/
				Maturity	Par Amount/		Amortized
Portfolio Company(4)	Spread Above Index(1)	Interest Rate		Date	Shares(9)		Cost			Fair Value

Investments and Cash Equivalents 190.4%
Investments 164.0%
Non-Controlled/Non-Affiliate Investments 126.8%
Corporate Fixed Income 1.6%
Corporate Bond 1.6%
Utilities: Electric 1.6%
CSVC Acquisition Corp	—	7.75	%	6/15/2025	$	8,478,000	$	8,478,000		$	8,138,880
Total Utilities: Electric							8,478,000			8,138,880
Total Corporate Bond							$	8,478,000		$	8,138,880
Total Corporate Fixed Income							$	8,478,000		$	8,138,880
Corporate Debt 124.5%
Delayed Draw Term Loan 0.1%
Capital Equipment 0.0%
Endries International, Inc.(3)(5)(15)(19)	—	—		6/1/2023	$	—	(44,681		)	—
Total Capital Equipment							(44,681		)	—
Healthcare & Pharmaceuticals 0.0%
Great Expressions Dental Centers PC(2)(3)(5)(15)(19)	—	—		9/28/2023	$	—	(4,147		)	(10,005		)
Total Healthcare & Pharmaceuticals							(4,147		)	(10,005		)
Hotel, Gaming & Leisure 0.0%
NPC International, Inc.(2)(3)(5)(15)(19)	—	—		4/18/2025	$	—	(18,711		)	(20,002		)
Total Hotel, Gaming & Leisure							(18,711		)	(20,002		)
Media: Diversified & Production 0.1%
International Entertainment Investments Limited(3)(6)(18)(19)	GBP LIBOR + 4.25%	4.75	%	2/28/2022	£	599,178	755,088			795,989
Total Media: Diversified & Production							755,088			795,989
Services: Business 0.0%
Lakeland Tours, LLC(3)(5)(15)(21)	—	—		12/8/2024	$	—	(466		)	1,866
Sovos Compliance, LLC(2)(3)(15)(19)	—	—		3/1/2022	$	—	—			(48,387		)
Total Services: Business							(466		)	(46,521		)
Total Delayed Draw Term Loan							$	687,083		$	719,461

Table of Contents

First Lien Last Out Term Loan 6.0%
Environmental Industries 4.0%
Adler & Allan Group Limited(6)(17)(19)(21)(22)	GBP LIBOR + 7.50%	8.00	%	6/30/2024	£	15,141,463	19,064,227		20,256,052
Total Environmental Industries							19,064,227		20,256,052
Healthcare & Pharmaceuticals 2.0%
Clinical Innovations, LLC(15)(19)(21)(22)	L + 6.00%	7.49	%	10/17/2023	$	10,365,517	10,136,979		10,132,293
Total Healthcare & Pharmaceuticals							10,136,979		10,132,293
Total First Lien Last Out Term Loan							$	29,201,206	$	30,388,345

First Lien Senior Secured Loan 93.8%
Aerospace & Defense 3.9%
Anaren, Inc.(15)(19)(21)	L + 4.50%	6.19	%	2/18/2021	$	2,509,630	2,522,237		2,522,178
Novetta, LLC(15)	L + 5.00%	6.70	%	10/17/2022	$	3,854,294	3,778,545		3,745,892
Salient CRGT, Inc.(15)(19)(21)	L + 5.75%	7.32	%	2/28/2022	$	3,708,100	3,645,930		3,740,546
StandardAero Aviation Holdings, Inc.(15)(21)	L + 3.75%	5.32	%	7/7/2022	$	9,923,858	10,025,652		10,016,894
Total Aerospace & Defense							19,972,364		20,025,510
Automotive 3.6%
CST Buyer Company(15)(19)(21)	L + 6.25%	7.75	%	3/1/2023	$	9,801,261	9,674,796		9,879,671
OEConnection LLC(15)(21)	L + 4.00%	5.69	%	11/22/2024	$	8,175,779	8,134,900		8,165,560
Total Automotive							17,809,696		18,045,231
Beverage, Food & Tobacco 6.5%
Captain D’s LLC(15)(19)(21)	L + 4.50%	5.98	%	12/15/2023	$	13,540,845	13,405,528		13,405,437
K-Mac Holdings Corp.(15)(19)(21)	L + 4.75%	6.32	%	12/20/2022	$	14,040,000	13,850,449		14,138,280
Restaurant Technologies, Inc.(15)(21)	L + 4.75%	6.20	%	11/23/2022	$	5,266,653	5,221,740		5,260,070
Total Beverage, Food & Tobacco							32,477,717		32,803,787
Capital Equipment 5.0%
Dorner Manufacturing Corp.(15)(19)(21)	L + 5.75%	7.32	%	3/15/2023	$	8,288,872	8,108,458		8,305,450
DXP Enterprises, Inc.(6)(15)(19)(21)	L + 5.50%	7.07	%	8/29/2023	$	5,230,350	5,180,464		5,282,654
Endries International, Inc.(15)(19)(21)	L + 4.75%	6.15	%	6/1/2023	$	6,540,319	6,452,400		6,540,319
Wilsonart LLC(15)(21)	L + 3.25%	4.95	%	12/19/2023	$	5,473,747	5,531,399		5,511,866
Total Capital Equipment							25,272,721		25,640,289
Chemicals, Plastics & Rubber 1.6%
ASP Chromaflo Intermediate Holdings, Inc.(15)(21)	L + 4.00%	5.57	%	11/20/2023	$	509,990	507,862		513,496
ASP Chromaflo Intermediate Holdings, Inc.(6)(15)(21)	L + 4.00%	5.57	%	11/20/2023	$	663,150	660,383		667,709
Niacet b.v.(6)(15)(19)(21)	EURIBOR + 4.50%	5.50	%	2/1/2024	€	3,865,193	4,133,673		4,651,765
Niacet Corporation(15)(19)(21)	L + 4.50%	6.19	%	2/1/2024	$	2,223,200	2,204,254		2,228,758
Total Chemicals, Plastics & Rubber							7,506,172		8,061,728

Table of Contents

Construction & Building 3.4%
Bolt Infrastructure Merger Sub, Inc.(15)(21)	L + 3.50%	5.07	%	6/21/2024	$	2,697,465	2,684,931	2,706,744
Regan Development Holdings Limited(6)(17)(19)	EURIBOR + 7.00%	7.50	%	5/2/2022	€	2,825,002	3,077,840	3,398,198
Regan Development Holdings Limited(6)(17)(19)	EURIBOR + 7.00%	7.50	%	5/2/2022	€	8,574,506	9,167,494	10,314,281
Regan Development Holdings Limited(6)(17)(19)	EURIBOR + 7.00%	7.50	%	5/2/2022	€	915,945	1,040,239	1,101,791
Total Construction & Building							15,970,504	17,521,014
Consumer Goods: Durable 3.0%
Harbor Freight Tools USA, Inc.(16)(21)	L + 3.25%	4.82	%	8/18/2023	$	15,000,000	15,105,349	15,118,365
Total Consumer Goods: Durable							15,105,349	15,118,365
Consumer Goods: Non-Durable 4.2%
FineLine Technologies, Inc.(15)(19)(21)	L + 4.75%	6.44	%	11/2/2022	$	14,659,018	14,379,947	14,585,723
Kronos Acquisition Holdings Inc.(15)(21)	L + 4.50%	6.17	%	8/26/2022	$	2,783,522	2,776,997	2,809,038
Melissa & Doug, LLC(15)(19)(21)	L + 3.75%	5.44	%	6/19/2024	$	3,830,680	3,814,142	3,859,410
Total Consumer Goods: Non-Durable							20,971,086	21,254,171
Containers, Packaging & Glass 5.0%
BWAY Holding Company(18)(21)	L + 3.25%	4.60	%	4/3/2024	$	12,942,481	12,941,997	13,013,264
CSP Technologies North America, LLC(15)(19)(21)	L + 5.25%	6.94	%	1/29/2022	$	12,285,894	12,285,894	12,316,608
Total Containers, Packaging & Glass							25,227,891	25,329,872
Energy: Oil & Gas 2.7%
Keane Group, Inc.(6)(15)(19)(21)	L + 7.25%	9.00	%	8/18/2022	$	13,793,468	13,666,341	13,807,262
Total Energy: Oil & Gas							13,666,341	13,807,262
Healthcare & Pharmaceuticals 5.8%
Drive DeVilbiss(15)(21)	L + 5.50%	7.19	%	1/3/2023	$	6,714,072	6,189,778	6,214,545
Great Expressions Dental Centers PC(15)(19)(21)	L + 4.75%	6.32	%	9/28/2023	$	8,063,925	7,959,637	7,942,966
Island Medical Management Holdings, LLC(15)(19)(21)	L + 5.50%	7.00	%	9/1/2022	$	10,629,110	10,480,292	10,310,237
U.S. Anesthesia Partners, Inc.(15)(21)	L + 3.25%	4.82	%	6/23/2024	$	4,987,469	4,969,431	5,006,172
Total Healthcare & Pharmaceuticals							29,599,138	29,473,920
High Tech Industries 16.4%
Lighthouse Network, LLC(15)(21)	L + 4.50%	6.07	%	11/29/2024	$	16,250,891	16,171,524	16,332,145
Netsmart Technologies, Inc.(15)(21)	L + 4.50%	6.19	%	4/19/2023	$	16,166,203	16,200,542	16,375,022
Qlik Technologies(15)(21)	L + 3.50%	5.04	%	4/26/2024	$	17,917,481	17,867,534	17,559,132
SolarWinds Holdings, Inc.(15)(21)	L + 3.50%	5.07	%	2/3/2023	$	14,912,218	15,011,042	14,984,915
Zywave, Inc.(15)(19)(21)	L + 5.00%	6.61	%	11/17/2022	$	17,728,574	17,580,683	17,728,574
Total High Tech Industries							82,831,325	82,979,788
Insurance 2.0%
Alliant Holdings Intermediate, LLC(15)(21)	L + 3.25%	4.80	%	8/12/2022	$	7,480,852	7,550,046	7,528,475
Wink Holdco, Inc.(15)(21)	L + 3.00%	4.49	%	11/2/2024	$	2,619,172	2,612,843	2,645,364
Total Insurance							10,162,889	10,173,839

Table of Contents

Media: Broadcasting & Subscription 3.0%
Micro Holding Corp.(18)(21)	L + 3.75%	5.34	%	9/13/2024	$	14,962,500	14,927,621			15,019,941
Total Media: Broadcasting & Subscription							14,927,621			15,019,941
Media: Diversified & Production 4.2%
Deluxe Entertainment Services Group Inc.(15)(21)	L + 5.50%	6.88	%	2/28/2020	$	10,912,628	10,454,998			10,721,657
International Entertainment Investments Limited(6)(18)(19)(21)	GBP LIBOR + 4.75%	5.24	%	5/31/2022	£	7,673,114	9,314,218			10,368,679
Total Media: Diversified & Production							19,769,216			21,090,336
Real Estate 2.1%
Spectre (Carrisbrook House) Limited(6)(15)(19)	EURIBOR + 7.50%	8.50	%	8/9/2021	£	9,300,000	10,644,272			10,863,204
Total Real Estate							10,644,272			10,863,204
Retail 2.6%
CH Hold Corp.(15)(21)	L + 3.00%	4.57	%	2/1/2024	$	1,514,280	1,511,626			1,525,637
Eyemart Express LLC(15)(21)	L + 3.00%	4.44	%	8/4/2024	$	11,622,196	11,667,646			11,647,626
Total Retail							13,179,272			13,173,263
Services: Business 10.8%
Advantage Sales & Marketing Inc.(15)(21)	L + 3.25%	4.63	%	7/23/2021	$	15,907,613	15,579,348			15,553,000
Comet Bidco Limited(6)(18)	GBP LIBOR + 5.25%	5.74	%	10/10/2024	£	6,260,870	8,025,268			8,321,073
Genuine Financial Holdings LLC(15)(19)(21)	L + 4.75%	6.38	%	1/26/2023	$	9,493,949	9,394,123			9,588,888
Lakeland Tours, LLC(15)(21)	L + 4.00%	5.59	%	12/8/2024	$	2,265,805	2,260,141			2,288,463
New Insight Holdings, Inc.(15)(21)	L + 5.50%	7.13	%	12/20/2024	$	10,673,472	10,140,377			10,250,984
Sovos Compliance, LLC(15)(19)(21)	L + 6.00%	7.57	%	3/1/2022	$	8,687,901	8,610,473			8,601,022
Travel Leaders Group, LLC(18)(21)	L + 4.50%	5.92	%	1/25/2024	$	294,097	292,867			298,876
Total Services: Business							54,302,597			54,902,306
Telecommunications 2.6%
Masergy Holdings, Inc.(15)(21)	L + 3.75%	5.44	%	12/15/2023	$	693,116	690,187			697,448
Polycom, Inc.(15)(21)	L + 5.25%	6.78	%	9/27/2023	$	12,164,688	12,014,392			12,291,408
Total Telecommunications							12,704,579			12,988,856
Wholesale 5.4%
American Tire Distributors Inc(15)(21)	L + 4.25%	5.82	%	9/1/2021	$	17,028,623	17,120,740			17,171,238
PT Holdings, LLC(15)(21)	L + 4.00%	5.57	%	11/30/2024	$	9,954,211	9,904,920			10,016,424
Total Wholesale							27,025,660			27,187,662
Total First Lien Senior Secured Loan							$	469,126,410		$	475,460,344

Revolver 1.4%
Automotive 0.0%
CST Buyer Company(3)(5)(15)(19)	—	—		3/1/2023	$	—	(11,593		)	7,180
Total Automotive							(11,593		)	7,180
Banking 0.0%
Tidel Engineering, L.P.(3)(15)(19)	—	—		3/1/2023	$	—	—			—
Total Banking							—			—

Table of Contents

Beverage, Food & Tobacco 0.2%
Captain D’s LLC(3)(15)(19)	L + 4.50%	6.03	%	12/15/2023	$	1,018,981	1,000,490		1,000,358
K-Mac Holdings Corp.(3)(15)(19)	L + 3.50%	5.07	%	12/20/2021	$	160,000	160,000		171,200
Total Beverage, Food & Tobacco							1,160,490		1,171,558
Capital Equipment 0.2%
Dorner Manufacturing Corp.(3)(15)(19)	L + 5.75%	7.32	%	3/15/2023	$	439,553	415,595		443,949
Endries International, Inc.(3)(15)(19)	P + 3.75%	8.25	%	6/1/2022	$	701,568	658,025		701,568
Winchester Electronics Corporation(3)(15)(19)	—	—		6/30/2021	$	—	—		—
Total Capital Equipment							1,073,620		1,145,517
Chemicals, Plastics & Rubber 0.2%
AP Plastics Group, LLC(3)(15)(19)	L + 4.75%	6.12	%	8/1/2021	$	935,022	935,022		935,022
PRCC Holdings, Inc.(3)(19)	—	—		2/1/2021	$	—	—		—
Total Chemicals, Plastics & Rubber							935,022		935,022
Construction & Building 0.0%
Stanton Carpet Corp.(3)(15)(19)	—	—		11/21/2022	$	—	—		—
Total Construction & Building							—		—
Consumer Goods: Non-Durable 0.0%
FineLine Technologies, Inc.(2)(3)(5)(15)(19)	—	—		11/2/2021	$	—	(45,292	)	(13,104	)
Solaray, LLC(3)(15)(19)	—	—		9/9/2022	$	—	—		—
Total Consumer Goods: Non-Durable							(45,292	)	(13,104	)
Healthcare & Pharmaceuticals 0.2%
Clinical Innovations, LLC(3)(15)(19)(22)	L + 6.00%	7.49	%	10/17/2022	$	153,563	128,728		127,649
Great Expressions Dental Centers PC(3)(12)(15)(19)	L + 4.75%	6.39	%	9/28/2022	$	983,614	969,683		966,109
Total Healthcare & Pharmaceuticals							1,098,411		1,093,758
High Tech Industries 0.1%
Zywave, Inc.(3)(13)(15)(19)	L + 5.00%	7.43	%	11/17/2022	$	287,802	272,177		287,802
Total High Tech Industries							272,177		287,802
Media: Advertising, Printing & Publishing 0.1%
Ansira Holdings, Inc.(3)(15)(19)	—	—		12/20/2022	$	—	—		—
Cruz Bay Publishing, Inc.(3)(15)(19)	P + 3.00%	7.50	%	6/6/2019	$	566,680	566,680		566,680
Total Media: Advertising, Printing & Publishing							566,680		566,680
Media: Diversified & Production 0.0%
Efficient Collaborative Retail Marketing Company, LLC(3)(15)(19)	—	—		6/15/2022	$	—	—		—
Total Media: Diversified & Production							—		—
Retail 0.0%
Batteries Plus Holding Corporation(3)(15)(19)	—	—		7/6/2022	$	—	—		—
Total Retail							—		—
Services: Business 0.1%
McKissock, LLC(3)(15)(19)	P + 2.50%	7.00	%	8/5/2019	$	708,350	708,350		708,350
Sovos Compliance, LLC(2)(3)(5)(15)(19)	—	—		3/1/2022	$	—	(13,204	)	(14,516	)
TEI Holdings Inc.(3)(15)(19)	—	—		12/20/2022	$	—	—		—
Total Services: Business							695,146		693,834

Table of Contents

Transportation: Cargo 0.3%
ENC Holding Corporation(3)(15)(19)	P + 3.75%	8.25	%	2/8/2023	$	1,521,775	1,521,775		1,521,775
Total Transportation: Cargo							1,521,775		1,521,775
Transportation: Consumer 0.0%
Direct Travel, Inc.(3)(19)	—	—		12/1/2021	$	—	—		—
Total Transportation: Consumer							—		—
Total Revolver							$	7,266,436	$	7,410,022

Second lien senior secured loan 23.2%
Aerospace & Defense 2.9%
TECT Power Holdings, LLC(15)(19)(21)	L + 8.50%	10.07	%	12/27/2021	$	14,757,969	14,483,760		14,772,727
Total Aerospace & Defense							14,483,760		14,772,727
Automotive 1.3%
OEConnection LLC(15)(19)(21)	L + 8.00%	9.69	%	11/17/2025	$	6,460,396	6,396,132		6,460,396
Total Automotive							6,396,132		6,460,396
Beverage, Food & Tobacco 0.3%
Restaurant Technologies, Inc.(15)(19)(21)	L + 8.75%	10.20	%	11/23/2023	$	1,693,548	1,663,433		1,697,782
Total Beverage, Food & Tobacco							1,663,433		1,697,782
Capital Equipment 1.1%
EXC Holdings III Corp.(15)(21)	L + 7.50%	9.16	%	11/16/2025	$	5,240,489	5,197,471		5,319,096
Total Capital Equipment							5,197,471		5,319,096
Energy: Oil & Gas 2.6%
Bruin E&P Partners, LLC(15)(19)	L + 7.38%	8.90	%	3/7/2023	$	13,020,000	12,805,884		13,150,200
Total Energy: Oil & Gas							12,805,884		13,150,200
Healthcare & Pharmaceuticals 5.1%
TecoStar Holdings, Inc.(15)(19)(21)	L + 8.50%	9.88	%	11/1/2024	$	9,471,942	9,246,013		9,481,414
U.S. Anesthesia Partners, Inc.(15)(19)(21)	L + 7.25%	8.82	%	6/23/2025	$	16,520,000	16,288,816		16,553,040
Total Healthcare & Pharmaceuticals							25,534,829		26,034,454
High Tech Industries 4.2%
Intralinks, Inc.(15)(21)	L + 8.00%	9.70	%	11/10/2025	$	13,469,388	13,335,962		13,458,168
nThrive, Inc.(15)(19)(21)	L + 9.75%	11.32	%	4/20/2023	$	8,000,000	7,980,000		7,960,000
Total High Tech Industries							21,315,962		21,418,168
Hotel, Gaming & Leisure 1.0%
NPC International, Inc.(15)(21)	L + 7.50%	9.05	%	4/18/2025	$	4,703,667	4,683,039		4,821,259
Total Hotel, Gaming & Leisure							4,683,039		4,821,259
Insurance 0.4%
Wink Holdco, Inc.(15)(21)	L + 6.75%	8.24	%	11/2/2025	$	2,039,478	2,029,614		2,064,972
Total Insurance							2,029,614		2,064,972

Table of Contents

Media: Advertising, Printing & Publishing 1.1%
Learfield Communications LLC(15)(19)(21)	L + 7.25%	8.82	%	12/2/2024	$	5,400,000	5,351,468		5,454,000
Total Media: Advertising, Printing & Publishing							5,351,468		5,454,000
Retail 0.2%
CH Hold Corp.(15)(21)	L + 7.25%	8.82	%	2/3/2025	$	1,215,470	1,210,312		1,242,818
Total Retail							1,210,312		1,242,818
Services: Business 1.0%
OPE Inmar Acquisition, Inc.(15)(21)	L + 8.00%	9.42	%	5/1/2025	$	5,058,410	5,003,214		5,048,925
Total Services: Business							5,003,214		5,048,925
Telecommunications 0.2%
Masergy Holdings, Inc.(15)(21)	L + 8.50%	10.19	%	12/16/2024	$	778,846	771,793		790,042
Total Telecommunications							771,793		790,042
Transportation: Cargo 1.8%
Direct ChassisLink, Inc.(18)(19)(21)	L + 6.00%	7.51	%	6/15/2023	$	9,031,936	8,986,776		9,212,575
Total Transportation: Cargo							8,986,776		9,212,575
Total Second lien senior secured loan							$	115,433,687	$	117,487,414
Total Corporate Debt							$	621,714,822	$	631,465,586
Equity 0.7%
Series A Preferred Units 0.4%
Healthcare & Pharmaceuticals 0.4%
CB Titan Holdings, Inc.(14)(19)	—	—		—	1,952,879		1,952,879		1,963,490
Total Healthcare & Pharmaceuticals							1,952,879		1,963,490
Total Series A Preferred Units							1,952,879		1,963,490
High Tech Industries 0.3%
Equity Interest 0.3%
Impala Private Investments, LLC(14)(19)	—	—		—	1,500,000		1,500,000		1,500,000
Total High Tech Industries							1,500,000		1,500,000
Total Equity Interest							1,500,000		1,500,000
Total Equity							$	3,452,879	$	3,463,490
Total Non-Controlled/Non-Affiliate Investments							$	633,645,701	$	643,067,956
Controlled Affiliate Investments 37.2%
Corporate Debt 0.4%
First lien senior secured loan 0.4%
Aerospace & Defense 0.4%
BCC Jetstream Holdings Aviation (On II), LLC(10)(11)(19)(20)	—	10.00	%	6/2/2022	$	1,837,216	1,837,216		1,837,216
Total Aerospace & Defense							1,837,216		1,837,216
Total First lien senior secured loan							$	1,837,216	$	1,837,216
Total Corporate Debt							$	1,837,216	$	1,837,216

Table of Contents

Equity 36.8%
Equity Interest 36.8%
Aerospace & Defense 1.6%
BCC Jetstream Holdings Aviation (On II), LLC(10)(11)(14)(19)(20)	—	—		—	324,214	324,214		424,261
BCC Jetstream Holdings Aviation (Off I), LLC(6)(10)(11)(14)(19)(20)	—	—		—	7,403,505	7,403,505		7,838,831
Total Aerospace & Defense						7,727,719		8,263,092
Investment Vehicles 35.2%
Antares Bain Capital Complete Financing
Solution LLC(6)(10)(11)(19)	—	—		—	178,052,288	178,052,288		178,409,807
Total Investment Vehicles						178,052,288		178,409,807
Total Equity Interest						$	185,780,007	$	186,672,899
Total Equity						$	185,780,007	$	186,672,899
Unfunded Commitment 0.0%
Aerospace & Defense 0.0%
BCC Jetstream Holdings Aviation (On II), LLC(7)(10)(11)(14)(19)(20)	—	—		6/2/2022	—	—		—
Total Aerospace & Defense						—		—
Total Unfunded Commitment						—		—
Total Controlled Affiliate Investments						$	187,617,223	$	188,510,115
Total Investments						$	821,262,924	$	831,578,071
Cash Equivalents 26.4%
Goldman Sachs Financial Square Government Fund	—	1.23	%	—	—	133,639,685		133,639,685
Total Cash Equivalents						$	133,639,685	$	133,639,685
Total Investments and Cash Equivalents						$	954,902,609	$	965,217,756

Table of Contents

Forward Foreign Currency Exchange Contracts(8)

				Unrealized
				Appreciation
Currency Purchased	Currency Sold	Counterparty	Settlement Date	(Depreciation)

U.S. DOLLARS 235,405	EURO 202,017	Bank of New York Mellon	1/2/2018	$	(7,139	)
U.S. DOLLARS 278,347	EURO 238,447	Bank of New York Mellon	2/2/2018	(8,463		)
U.S. DOLLARS 16,380,814	EURO 15,080,000	Bank of New York Mellon	3/6/2018	(1,792,291		)
U.S. DOLLARS 65,054	EURO 53,872	Bank of New York Mellon	4/3/2018	15
U.S. DOLLARS 12,118,964	EURO 10,080,000	Bank of New York Mellon	6/22/2018	(114,837		)
U.S. DOLLARS 49,293	POUND STERLING 36,384	Bank of New York Mellon	1/2/2018	115
U.S. DOLLARS 40,752	POUND STERLING 30,542	Bank of New York Mellon	1/12/2018	(562		)
U.S. DOLLARS 400,093	POUND STERLING 305,318	Citibank	1/31/2018	(13,196		)
U.S. DOLLARS 9,647,586	POUND STERLING 7,635,000	Bank of New York Mellon	3/6/2018	(698,500		)
U.S. DOLLARS 20,063,392	POUND STERLING 15,200,000	Citibank	6/22/2018	(614,324		)
U.S. DOLLARS 8,060,115	POUND STERLING 6,090,000	Bank of New York Mellon	9/28/2018	(255,632		)
				$	(3,504,814	)

(1) The investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (‘‘LIBOR’’ or ‘‘L’’), the Euro Interbank Offered Rate (‘‘EURIBOR’’ or ‘‘E’’), British Pound Sterling LIBOR Rate (‘‘GBP LIBOR’’) or the Prime Rate (‘‘Prime’’ or ‘‘P’’) and which reset daily, monthly, quarterly or semiannually. For each, the Company has provided the spread over LIBOR, EURIBOR, GBP LIBOR or Prime and the current weighted average interest rate in effect at December 31, 2017. Certain investments are subject to a LIBOR, EURIBOR, GBP LIBOR or Prime interest rate floor.

(2) The negative fair value is the result of the capitalized discount on the loan or the unfunded commitment being valued below par.

(3) Position or portion thereof is an unfunded loan commitment, and no interest is being earned on the unfunded portion. The investment may be subject to an unused/letter of credit facility fee.

(4) Percentages are based on the Company’s net assets of $506,962,828 as of December 31, 2017.

(5) The negative amortized cost is the result of the capitalized discount being greater than the principal amount outstanding on the loan.

(6) The investment is not a qualifying asset under Section 55(a) of the Investment Company Act of 1940. The Company may not acquire any non-qualifying asset unless, at the time of acquisition, qualifying assets represent at least 70% of the Company’s total assets. As of December 31, 2017, non-qualifying assets totaled 28.1% of the Company’s total assets.

(7) The assets to be issued will be determined at the time the funds are called.

(8) Unrealized appreciation/(depreciation) on forward currency exchange contracts.

(9) The principal amount (par amount) for all debt securities is denominated in U.S. dollars, unless otherwise noted. £ represents Pound Sterling and A represents Euro.

(10) As defined in the 1940 Act, the Company is deemed to be an ‘‘Affiliated Investment’’ of the Company as the Company owns five percent or more of the portfolio company’s securities.

(11) As defined in the 1940 Act, the Company is deemed to ‘‘Control’’ this portfolio company as the Company either 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.

(12) $50,014 of the total par amount for this security is at P + 3.75%.

(13) $127,912 of the total par amount for this security is at P + 4.00%.

(14) Non-Income Producing.

(15) Loan includes interest rate floor of 1.00%.

(16) Loan includes interest rate floor of 0.75%.

(17) Loan includes interest rate floor of 0.50%.

(18) Loan includes interest rate floor of 0.00%.

(19) Security valued using unobservable inputs (Level 3).

(20) The Company holds non-controlling, affiliate interest in an aircraft-owning special purpose vehicle through this investment.

(21) Assets are pledged as collateral for the BCSF Revolving Credit Facility. See Note 6 ‘‘Borrowings’’.

(22) The Company generally earns a higher interest rate on the ‘‘last out’’ tranche of debt, to the extent the debt has been allocated to ‘‘first out’’ and ‘‘last out’’ tranches, whereby the ‘‘first out’’ tranche will have priority as to the ‘‘last out’’ tranche with respect to payments of principal, interest and any other amounts due thereunder.

See Notes to Consolidated Financial Statements.

Table of Contents

BAIN CAPITAL SPECIALTY FINANCE, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(unaudited)

Note 1. Organization

Bain Capital Specialty Finance, Inc. (the “Company”) was formed on October 5, 2015 and commenced investment operations on October 13, 2016. The Company has elected to be treated and is regulated as a business development company (a “BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). In addition, for tax purposes the Company has elected to be treated, and intends to operate in a manner so as to continuously qualify, as a regulated investment company (a “RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”), commencing concurrently with its election to be treated as a BDC. The Company is externally managed by BCSF Advisors, LP (the “Advisor” or “BCSF Advisors”), our investment adviser that is registered with the Securities and Exchange Commission (the “SEC”) under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). The Advisor also provides the administrative services necessary for the Company to operate (in such capacity, the “Administrator” or “BCSF Advisors”).

The Company’s primary focus is capitalizing on opportunities within its Advisor’s Senior Direct Lending Strategy, which seeks to provide risk-adjusted returns and current income to its stockholders by investing primarily in middle-market companies with between $10.0 million and $150.0 million in EBITDA. The Company focuses on senior investments with a first or second lien on collateral and strong structures and documentation intended to protect the lender. The Company generally seeks to retain voting control in respect of the loans or particular classes of securities in which the Company invests through maintaining affirmative voting positions or negotiating consent rights that allow the Company to retain a blocking position. The Company may also invest in mezzanine debt and other junior securities and in secondary purchases of assets or portfolios, as described below. Investments are likely to include, among other things, (i) senior first lien, stretch senior, senior second lien, unitranche, (ii) mezzanine debt and other junior investments and (iii) secondary purchases of assets or portfolios that primarily consist of middle-market corporate debt. The Company may also invest, from time to time, in equity securities, distressed debt, debtor-in-possession loans, structured products, structurally subordinate loans, investments with deferred interest features, zero-coupon securities and defaulted securities.

Note 2. Summary of Significant Accounting Policies

Basis of Presentation

The Company’s unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The Company’s consolidated financial statements and related financial information have been prepared pursuant to the requirements for reporting on Form 10-Q and Regulation S-X. These consolidated financial statements reflect adjustments that in the opinion of the Company are necessary for the fair statement of the financial position and results of operations for the periods presented herein and are not necessarily indicative of the full fiscal year. The Company has determined it meets the definition of an investment company and follows the accounting and reporting guidance in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946 — Financial Services — Investment Companies. The functional currency of the Company is U.S. dollars and these consolidated financial statements have been prepared in that currency.

The information included in this Form 10-Q should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2017.

Basis of Consolidation

The Company will generally consolidate any wholly, or substantially, owned subsidiary when the design and purpose of the subsidiary is to act as an extension of the Company’s investment operations and to facilitate the execution of the Company’s investment strategy. Accordingly, the Company consolidated the results of its subsidiaries BCSF I, LLC, which was formed on September 20, 2017, and BCC Middle Market CLO 2018-1, LLC, which was formed on August 3, 2018, in its consolidated financial statements. All intercompany transactions and balances have been eliminated in consolidation. Since the Company is an investment company, portfolio investments held by the Company are not consolidated into the consolidated financial statements. The portfolio investments held by the Company (including its investments held by consolidated subsidiaries) are included on the consolidated statements of assets and liabilities as investments at fair value. The Company does not consolidate its interest in Antares Bain Capital Complete Financing Solution LLC (together with ABC Complete Financing Solution LLC, “ABCS”). See further description of the Company’s investment in ABCS in Note 3.

Table of Contents

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates and such differences could be material.

Valuation of Portfolio Investments

Investments for which market quotations are readily available are typically valued at such market quotations. Market quotations are obtained from an independent pricing service, where available. If a price cannot be obtained from an independent pricing service or if the independent pricing service is not deemed to be current with the market, certain investments held by the Company will be valued on the basis of prices provided by principal market makers. Generally investments marked in this manner will be marked at the mean of the bid and ask of the independent broker quotes obtained. To validate market quotations, the Company utilizes a number of factors to determine if the quotations are representative of fair value, including the source and number of quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available are valued at fair value, subject at all times to the oversight and approval of the board of directors of the Company (the “Board”), based on, among other things, the input of the Advisor, the Company’s audit committee of the Board (the “Audit Committee) and one or more independent third party valuation firms engaged by the Board.

With respect to unquoted securities, the Company will value each investment considering, among other measures, discounted cash flow models, comparisons of financial ratios of peer companies that are public and other factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Company will use the pricing indicated by the external event to corroborate and/or assist us in our valuation. 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 differ significantly from the values that would have been used had a readily available market value existed for such investments, and the differences could be material.

With respect to investments for which market quotations are not readily available, the Advisor will undertake a multi-step valuation process, which includes among other things, the below:

· The Company’s quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals of the Advisor responsible for the portfolio investment or by an independent valuation firm;

· Preliminary valuation conclusions are then documented and discussed with the Company’s senior management and the Advisor. Agreed upon valuation recommendations are presented to the Audit Committee;

· The Audit Committee of the Board reviews the valuations presented and recommends values for each of the investments to the Board;

· At least once annually, the valuation for each portfolio investment constituting a material portion of the Company’s portfolio will be reviewed by an independent valuation firm; and

· The Board will discuss valuations and determine the fair value of each investment in good faith based upon, among other things, the input of the Advisor, independent valuation firms, where applicable, and the Audit Committee.

In following this approach, the types of factors that are taken into account in the fair value pricing of investments include, as relevant, but are not limited to: comparison to publicly traded securities, including factors such as yield, maturity and measures of credit quality; the enterprise value of a portfolio company; the nature and realizable value of any collateral; the portfolio company’s ability to make payments and its earnings and discounted cash flows; and the markets in which the portfolio company does business. In cases where an independent valuation firm provides fair valuations for investments, the independent valuation firm provides a fair valuation report, a description of the methodology used to determine the fair value and their analysis and calculations to support their conclusion. The Company determines the fair value of its investment in ABCS giving consideration to the assets and liabilities of ABCS, at fair value, including consideration of any necessary adjustments. The Company currently conducts this valuation process on a quarterly basis.

The Company applies ASC Topic 820, Fair Value Measurement (“ASC 820”), which establishes a framework for measuring fair value in accordance with U.S. GAAP and required disclosures of fair value measurements. The fair value of a financial instrument is the amount that would be received in an orderly transaction between market participants at the measurement date. The Company determines the fair value of investments consistent with its valuation policy. The Company discloses the fair value of its investments in a hierarchy which prioritizes and ranks the level of market observability used in the determination of fair value. In accordance with ASC 820, these levels are summarized below:

· Level 1 — Valuations based on quoted prices (unadjusted) in active markets for identical assets or liabilities at the measurement date.

Table of Contents

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

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

A financial instrument’s level within the hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuations of Level 2 investments are generally based on quotations received from pricing services, dealers or brokers. Consideration is given to the source and nature of the quotations and the relationship of recent market activity to the quotations provided.

Transfers between levels, if any, are recognized at the beginning of the reporting period in which the transfers occur. The Company evaluates the source of inputs used in the determination of fair value, including any markets in which the investments, or similar investments, are trading. When the fair value of an investment is determined using inputs from a pricing service (or principal market makers), the Company considers various criteria in determining whether the investment should be classified as a Level 2 or Level 3 investment. Criteria considered include the pricing methodologies of the pricing services (or principal market makers) to determine if the inputs to the valuation are observable or unobservable, as well as the number of prices obtained and an assessment of the quality of the prices obtained. The level of an investment within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. However, the determination of what constitutes “observable” requires significant judgment.

The value assigned to these investments is based upon available information and may fluctuate from period to period. In addition, it does not necessarily represent the amount that might ultimately be realized upon sale. Due to inherent uncertainty of valuation, the estimated fair value of investments may differ from the value that would have been used had a ready market for the security existed, and the difference could be material.

Securities Transactions, Revenue Recognition and Expenses

The Company records its investment transactions on a trade date basis. The Company measures realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, using the specified identification method. Interest income, adjusted for amortization of premium and accretion of discount, is recorded on an accrual basis. Discount and premium to par value on investments acquired are accreted and amortized, respectively, into interest income over the life of the respective investment using the effective interest method. Loan origination fees, original issue discount and market discount or premium are capitalized and amortized against or accreted into interest income using the effective interest method or straight-line method, as applicable. Upon prepayment of a loan or debt security, any prepayment premium, unamortized upfront loan origination fees and unamortized discount are recorded as interest income.

Dividend income on preferred equity investments is recorded on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity investments is recorded on the record date for private portfolio companies and on the ex-dividend date for publicly traded portfolio companies. Distributions received from a limited liability company or limited partnership investment are evaluated to determine if the distribution should be recorded as dividend income or a return of capital.

Certain investments may have contractual payment-in-kind (“PIK”) interest or dividends. PIK represents accrued interest or accumulated dividends that are added to the loan principal of the investment on the respective interest or dividend payment dates rather than being paid in cash and generally becomes due at maturity or upon being called by the issuer. PIK is recorded as interest or dividend income, as applicable. If at any point the Company believes PIK is not expected to be realized, the investment generating PIK 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 or dividend income, as applicable.

Certain structuring fees and amendment fees are recorded as other income when earned. Administrative agent fees received by the Company are recorded as other income when the services are rendered.

Expenses are recorded on an accrual basis.

Table of Contents

Non-Accrual Loans

Loans or debt securities are placed on non-accrual status when there is reasonable doubt that principal or interest will be collected. Accrued interest generally is reversed when a loan or debt security is placed on non-accrual status. Interest payments received on non-accrual loans or debt securities may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual loans and debt securities are restored to accrual status when past due principal and interest are paid and, in management’s judgment, principal and interest payments are likely to remain current. The Company may make exceptions to this treatment if a loan has sufficient collateral value and is in the process of collection. As of September 30, 2018 and December 31, 2017, no securities had been placed on non-accrual status.

Distributions

Distributions to common stockholders are recorded on the record date. The amount to be distributed, if any, is determined by the Board each quarter, and is generally based upon the earnings estimated by the Advisor. Distributions from net investment income and net realized capital gains are determined in accordance with U.S. federal income tax regulations, which may differ from those amounts determined in accordance with U.S. GAAP. The Company may pay distributions to its stockholders in a year in excess of its net ordinary income and capital gains for that year and, accordingly, a portion of such distributions may constitute a return of capital for U.S. federal income tax purposes. This excess generally would be a tax-free return of capital in the period and generally would reduce the stockholder’s tax basis in its shares. These book/tax differences are either temporary or permanent in nature. To the extent these differences are permanent; they are charged or credited to paid-in capital in excess of par, accumulated undistributed net investment income or accumulated net realized gain (loss), as appropriate, in the period that the differences arise. Temporary and permanent differences are primarily attributable to differences in the tax treatment of certain loans and the tax characterization of income and non-deductible expenses.

The Company intends to timely distribute to its stockholders substantially all of its annual taxable income for each year, except that the Company may retain certain net capital gains for reinvestment and, depending upon the level of the Company’s taxable income earned in a year, the Company may choose to carry forward taxable income for distribution in the following year and incur applicable U.S. federal excise tax.

Dividend Reinvestment Plan

The Company has adopted a dividend reinvestment plan that provides for the reinvestment of cash dividends. Prior to the listing of the Company’s shares on a national securities exchange (a “Listing”), stockholders who “opt in” to the Company’s dividend reinvestment plan will have their cash dividends and distributions automatically reinvested in additional shares of the Company’s common stock, rather than receiving cash dividends and distributions.

Subsequent to a Listing, stockholders who do not “opt out” of the Company’s dividend reinvestment plan will have their cash dividends and distributions automatically reinvested in additional shares of the Company’s common stock, rather than receiving cash dividends and distributions.

Stockholders can elect to “opt in” or “opt out” of the Company’s dividend reinvestment plan in their Subscription Agreements, as defined in Note 9. The elections of stockholders that make an election prior to a Listing shall remain effective after the Listing.

Organization and Offering Costs

Organization costs consist primarily of legal, incorporation and accounting fees incurred in connection with the organization of the Company. Organization costs are expensed as incurred.

Offering costs consist primarily of fees and expenses incurred in connection with the offering of shares, including legal, underwriting, printing and other costs, as well as costs associated with the preparation and filing of applicable registration statements. Upon the issuance of shares, offering costs are offset against proceeds of the offering in paid-in capital in excess of par.

Table of Contents

Cash, Restricted Cash, and Cash Equivalents

Cash and cash equivalents consist of deposits held at custodian banks, and highly liquid investments, such as money market funds, with original maturities of three months or less. Cash and cash equivalents are carried at cost or amortized cost, which approximates fair value. The Company may deposit its cash and cash equivalents in financial institutions and, at certain times, such balances may exceed the Federal Deposit Insurance Corporation insurance limits. Cash equivalents are presented separately on the consolidated schedules of investments. Restricted cash is collected and held by the trustee who has been appointed as custodian of the assets securing certain of the Company’s financing transactions.

Foreign Currency Translation

The accounting records of the Company are maintained in U.S. dollars. The fair values of foreign securities, currency holdings and other assets and liabilities denominated in foreign currency are translated to U.S. dollars based on the current exchange rates at the end of each business day. Income and expenses denominated in foreign currencies are translated at current exchange rates when accrued or incurred. Unrealized gains and losses on foreign currency holdings and non-investment assets and liabilities attributable to the changes in foreign currency exchange rates are included in the net change in unrealized appreciation (depreciation) on foreign currency translation on the consolidated statements of operations. Net realized gains and losses on foreign currency holdings and non-investment assets and liabilities attributable to changes in foreign currency exchange rates are included in net realized gain (loss) on foreign currency transactions on the consolidated statements of operations. The portion of both realized and unrealized gains and losses on investments that result from changes in foreign currency exchange rates is not separately disclosed, but is included in net realized gain (loss) on investments and net change in unrealized appreciation (depreciation) on investments, respectively, on the consolidated statements of operations.

Forward Currency Exchange Contracts

The Company may enter into forward currency exchange contracts to reduce the Company’s exposure to foreign currency exchange rate fluctuations in the value of foreign currencies. A forward currency exchange contract is an agreement between two parties to buy and sell a currency at a set price on a future date. The Company does not utilize hedge accounting and as such the Company recognizes the value of its derivatives at fair value on the consolidated statements of assets and liabilities with changes in the net unrealized appreciation (depreciation) on forward currency exchange contracts recorded on the consolidated statements of operations. Forward currency exchange contracts are valued using the prevailing forward currency exchange rate of the underlying currencies. Unrealized appreciation (depreciation) on forward currency exchange contracts are recorded on the consolidated statements of assets and liabilities by counterparty on a net basis, not taking into account collateral posted which is recorded separately, if applicable. Cash collateral maintained in accounts held by counterparties is included in collateral on forward currency exchange contracts on the consolidated statements of assets and liabilities. Notional amounts and the gross fair value of forward currency exchange contracts assets and liabilities are presented separately on the consolidated schedules of investments.

Changes in net unrealized appreciation (depreciation) are recorded on the consolidated statements of operations in net change in unrealized appreciation (depreciation) on forward currency exchange contracts. Net realized gains and losses are recorded on the consolidated statements of operations in net realized gain (loss) on forward currency exchange contracts. Realized gains and losses on forward currency exchange contracts are determined using the difference between the fair market value of the forward currency exchange contract at the time it was opened and the fair market value at the time it was closed or covered. Additionally, losses, up to the fair value, may arise if the counterparties do not perform under the contract terms.

Deferred Financing Costs and Debt Issuance Costs

The Company records costs related to issuance of revolving debt obligations as deferred financing costs. These costs are deferred and amortized using the straight-line method over the stated maturity life of the obligation. The Company records costs related to the issuance of term debt obligations as debt issuance costs. These costs are deferred and amortized using the effective interest method. These costs are presented as a reduction to the outstanding principal amount of the term debt obligations on the consolidated statements of assets and liabilities.

Income Taxes

The Company has elected to be treated for U.S. federal income tax purposes as a RIC under the Code. So long as the Company maintains its status as a RIC, it will generally not be subject to corporate-level U.S. federal income or excise taxes on any ordinary income or capital gains that it distributes at least annually as dividends to its stockholders. As a result, any tax liability related to income earned and distributed by the Company represents obligations of the Company’s stockholders and will not be reflected in the consolidated financial statements of the Company.

The Company intends to comply with the applicable provisions of the Code pertaining to RICs and to make distributions of taxable income sufficient to relieve it from substantially all federal income taxes. Accordingly, no provision for income taxes is required in the consolidated financial statements. For income tax purposes, distributions made to stockholders are reported as ordinary income, capital gains, non-taxable return of capital, or a combination thereof. The tax character of distributions paid to stockholders through September 30, 2018 may include return of capital, however, the exact amount cannot be determined at this point. The final determination of the tax character of distributions will not be made until we file our tax return for the tax year ending December 31, 2018. The character of income and gains that we will distribute is determined in accordance with income tax regulations that may differ from GAAP. BCSF I, LLC and BCC Middle Market CLO 2018-1, LLC are disregarded entities for tax purposes and are consolidated with the tax return of the Company.

Table of Contents

The Company evaluates tax positions taken or expected to be taken in the course of preparing its 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 reversed and recorded as a tax benefit or expense in the current year. All penalties and interest associated with income taxes, if any, 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. Management has analyzed the Company’s tax positions, and has concluded that no liability for unrecognized tax benefits related to uncertain tax positions on returns to be filed by the Company for all open tax years should be recorded. The Company identifies its major tax jurisdiction as the United States, and the Company is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months. As of September 30, 2018, the tax years that remain subject to examination are from the year 2016 forward.

Recent Accounting Pronouncements

In March 2017, the FASB issued ASU 2017-08, “Receivables — Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities.” ASU 2017-08 shortens the amortization period for certain callable debt securities held at a premium by requiring the premium to be amortized to the earliest call date. This new guidance is effective for fiscal years beginning after December 15, 2018, as well as for interim periods within those fiscal years. Early adoption is permitted. The Company does not believe these changes will have a material impact on its consolidated financial statements and disclosures.

In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework — Changes to the Disclosure Requirements for Fair Value Measurement.” ASU 2018-13 is part of the disclosure framework project and eliminates certain disclosure requirements for fair value measurements, requires entities to disclose new information, and modifies existing disclosure requirements. The new guidance is effective after December 15, 2019. Early adoption is permitted. The Company is currently evaluating the impact this change will have on its consolidated financial statements and disclosures.

Note 3. Investments

The following table shows the composition of the investment portfolio, at amortized cost and fair value as of September 30, 2018 (with corresponding percentage of total portfolio investments):

	As of September 30, 2018
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
First Lien Senior Secured Loans	$	764,087,554	57.0	%	$	768,797,174	56.9	%
First Lien Last Out Loans	29,740,058		2.2		30,397,170		2.2
Second Lien Senior Secured Loans	214,158,341		16.0		215,053,521		15.9
Subordinated Debt	24,702,741		1.8		24,700,000		1.8
Corporate Bonds	33,898,598		2.5		33,175,470		2.5
Investment Vehicles (1)	256,316,439		19.1		258,632,338		19.1
Equity Interests	16,905,906		1.3		18,616,855		1.4
Preferred Equity	1,952,879		0.1		2,070,053		0.2
Total	$	1,341,762,516	100.0	%	$	1,351,442,581	100.0	%

(1) Represents equity investment in ABCS.

The following table shows the composition of the investment portfolio, at amortized cost and fair value as of December 31, 2017 (with corresponding percentage of total portfolio investments):

	As of December 31, 2017
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
First Lien Senior Secured Loans	$	478,807,128	58.3	%	$	485,319,396	58.4	%
First Lien Last Out Loans	29,329,934		3.6		30,515,994		3.7
Second Lien Senior Secured Loans	115,414,976		14.1		117,467,412		14.1
Corporate Bonds	8,478,000		1.0		8,138,880		1.0
Investment Vehicles (1)	178,052,288		21.7		178,409,807		21.4
Equity Interests	9,227,719		1.1		9,763,092		1.2
Preferred Equity	1,952,879		0.2		1,963,490		0.2
Total	$	821,262,924	100.0	%	$	831,578,071	100.0	%

Table of Contents

(1) Represents equity investment in ABCS.

The following table shows the composition of the investment portfolio by geographic region, at amortized cost and fair value as of September 30, 2018 (with corresponding percentage of total portfolio investments):

	As of September 30, 2018
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
United States (1)	$	1,203,050,307	89.6	%	$	1,211,946,504	89.7	%
United Kingdom	57,211,036		4.3		57,352,935		4.2
Ireland	24,003,412		1.8		25,082,571		1.9
Sweden	18,304,892		1.4		17,947,910		1.3
Norway	14,780,468		1.1		14,760,250		1.1
France	13,055,567		1.0		12,913,369		1.0
Netherlands	11,356,834		0.8		11,439,042		0.8
Total	$	1,341,762,516	100.0	%	$	1,351,442,581	100.0	%

(1) Includes equity investment in ABCS.

The following table shows the composition of the investment portfolio by geographic region, at amortized cost and fair value as of December 31, 2017 (with corresponding percentage of total portfolio investments):

	As of December 31, 2017
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
United States (1)	$	756,040,605	92.1	%	$	761,507,039	91.6	%
United Kingdom	37,158,801		4.5		39,741,793		4.8
Ireland	23,929,845		2.9		25,677,474		3.1
Netherlands	4,133,673		0.5		4,651,765		0.5
Total	$	821,262,924	100.0	%	$	831,578,071	100.0	%

(1) Includes equity investment in ABCS.

The following table shows the composition of the investment portfolio by industry, at amortized cost and fair value as of September 30, 2018 (with corresponding percentage of total portfolio investments):

	As of September 30, 2018
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
Investment Vehicles (1)	$	256,316,439	19.1	%	$	258,632,338	19.1	%
High Tech Industries	189,566,425		14.1		191,434,754		14.2
Healthcare & Pharmaceuticals	106,449,969		7.9		106,217,351		7.9
Services: Business	94,199,547		7.0		94,193,051		7.0
Aerospace & Defense	81,489,111		6.1		82,291,399		6.1
Hotel, Gaming & Leisure	72,571,003		5.4		73,530,045		5.4
Consumer Goods: Non-Durable	53,835,324		4.0		54,124,605		4.0
Transportation: Cargo	51,020,267		3.8		51,298,122		3.8
Capital Equipment	48,362,821		3.6		48,747,952		3.6
Retail	40,351,182		3.0		40,425,958		3.0
Containers, Packaging & Glass	35,366,817		2.6		35,335,491		2.6
Energy: Oil & Gas	30,580,293		2.3		30,731,999		2.2
Construction & Building	28,079,234		2.1		29,118,560		2.2
Wholesale	28,527,781		2.1		28,746,541		2.1
Insurance	24,902,551		1.9		24,867,121		1.8
Automotive	23,696,376		1.8		23,924,720		1.8
Energy: Electricity	22,419,958		1.7		22,417,787		1.7
Services: Consumer	21,029,247		1.6		21,206,727		1.6
Environmental Industries	19,098,906		1.4		19,533,532		1.4
Consumer Goods: Durable	17,174,674		1.3		17,334,702		1.3
Media: Broadcasting & Subscription	16,953,518		1.3		17,129,550		1.3

Table of Contents

Beverage, Food & Tobacco	16,642,868		1.3		16,683,669		1.2
Telecommunications	15,266,863		1.1		15,202,035		1.1
Media: Diversified & Production	10,620,959		0.8		11,318,099		0.8
Real Estate	10,693,059		0.8		10,791,720		0.8
Utilities: Electric	9,885,536		0.7		9,063,470		0.7
Chemicals, Plastics & Rubber	7,370,290		0.5		7,742,816		0.6
Media: Advertising, Printing & Publishing	5,658,849		0.4		5,733,872		0.4
FIRE: Finance	3,632,649		0.3		3,664,595		0.3
Banking	—		0.0		—		0.0
Transportation: Consumer	—		0.0		—		0.0
Total	$	1,341,762,516	100.0	%	$	1,351,442,581	100.0	%

(1) Represents equity investment in ABCS.

The following table shows the composition of the investment portfolio by industry, at amortized cost and fair value as of December 31, 2017 (with corresponding percentage of total portfolio investments):

	As of December 31, 2017
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
Investment Vehicles (1)	$	178,052,288	21.7	%	$	178,409,807	21.4	%
High Tech Industries	105,919,464		12.9		106,185,758		12.8
Healthcare & Pharmaceuticals	68,318,089		8.3		68,687,910		8.3
Services: Business	60,000,491		7.3		60,598,544		7.3
Aerospace & Defense	44,021,059		5.4		44,898,545		5.4
Beverage, Food & Tobacco	35,301,640		4.3		35,673,127		4.3
Capital Equipment	31,499,131		3.8		32,104,902		3.9
Wholesale	27,025,660		3.3		27,187,662		3.3
Energy: Oil & Gas	26,472,225		3.2		26,957,462		3.2
Containers, Packaging & Glass	25,227,891		3.1		25,329,872		3.0
Automotive	24,194,235		3.0		24,512,807		2.9
Media: Diversified & Production	20,524,304		2.5		21,886,325		2.6
Consumer Goods: Non-Durable	20,925,794		2.6		21,241,067		2.6
Environmental Industries	19,064,227		2.3		20,256,052		2.4
Construction & Building	15,970,504		1.9		17,521,014		2.1
Consumer Goods: Durable	15,105,349		1.8		15,118,365		1.8
Media: Broadcasting & Subscription	14,927,621		1.8		15,019,941		1.8
Retail	14,389,584		1.8		14,416,081		1.7
Telecommunications	13,476,372		1.6		13,778,898		1.7
Insurance	12,192,503		1.5		12,238,811		1.5
Real Estate	10,644,272		1.3		10,863,204		1.3
Transportation: Cargo	10,508,551		1.3		10,734,350		1.3
Chemicals, Plastics & Rubber	8,441,194		1.0		8,996,750		1.1
Utilities: Electric	8,478,000		1.0		8,138,880		1.0
Media: Advertising, Printing & Publishing	5,918,148		0.7		6,020,680		0.7
Hotel, Gaming & Leisure	4,664,328		0.6		4,801,257		0.6
Banking	—		0.0		—		0.0
Transportation: Consumer	—		0.0		—		0.0
Total	$	821,262,924	100.0	%	$	831,578,071	100.0	%

(1) Represents equity investment in ABCS.

Antares Bain Capital Complete Financing Solution

The Company has entered into a limited liability company agreement with Antares Midco Inc. (“Antares”) to invest in ABC Complete Financing Solution LLC, which makes investments through its subsidiary, Antares Bain Capital Complete Financing Solution LLC (together with ABC Complete Financing Solution LLC, “ABCS”). ABCS, an unconsolidated Delaware limited liability company, was formed on September 27, 2017 and commenced operations on November 29, 2017. ABCS’ principal purpose is to make investments, primarily in senior secured unitranche loans. The Company records its investment in ABCS at fair value. Distributions of income received from ABCS, if any, are recorded as dividend income from controlled investments in the consolidated

Table of Contents

statements of operations. Distributions received from ABCS in excess of income earned at ABCS, if any, are recorded as a return of capital and reduce the amortized cost of controlled affiliate investments.

The Company and Antares, as members of ABCS, have agreed to contribute capital up to (subject to the terms of their agreement) $950.0 million in aggregate to purchase equity interests in ABCS, with each member contributing up to $425.0 million and $525.0 million, respectively. Funding of such commitments generally requires the consent of both Antares Credit Opportunities Manager LLC and the Advisor on behalf of Antares and the Company, respectively. ABCS is capitalized with capital contributions from its members on a pro-rata basis based on their maximum capital contributions as transactions are funded after they have been approved.

Investment decisions of ABCS require the consent of both the Advisor and Antares Credit Opportunities Manager LLC, as representatives of the Company and Antares, respectively. Each of the Advisor and Antares source investments for ABCS.

As of September 30, 2018, ABCS had the following maximum capital contributions, contributions and unfunded capital contributions from its members.

	As of September 30, 2018
	Maximum Capital Contributions		Contributed Capital		Unfunded Capital Contributions
Bain Capital Specialty Finance, Inc.	$	425,000,000	$	257,626,698	$	167,373,302
Antares Midco Inc.	525,000,000		318,239,042		206,760,958
Total Investments	$	950,000,000	$	575,865,740	$	374,134,260

As of December 31, 2017, ABCS had the following maximum capital contributions, contributions and unfunded capital contributions from its members.

	As of December 31, 2017
	Maximum Capital Contributions		Contributed Capital		Unfunded Capital Contributions
Bain Capital Specialty Finance, Inc.	$	425,000,000	$	178,052,288	$	246,947,712
Antares Midco Inc.	525,000,000		219,941,870		305,058,130
Total Investments	$	950,000,000	$	397,994,158	$	552,005,842

ABCS entered into a senior credit facility with JP Morgan on November 29, 2017 (the “ABCS Facility”). The ABCS Facility allows ABCS to borrow up to $1.5 billion subject to leverage and borrowing base restrictions. The maturity date of the ABCS Facility is November 29, 2022. As of September 30, 2018 and December 31, 2017, the ABCS Facility had $929.8 million and $592.1 million of outstanding debt under the credit facility, respectively. As of September 30, 2018 and December 31, 2017, the effective rate on the ABCS Facility was 5.09% and 4.30% per annum, respectively.

As of September 30, 2018 and December 31, 2017, ABCS held total investments at fair value of $1,492.3 million and $956.2 million, respectively. As of September 30, 2018 and December 31, 2017, ABCS’s portfolio was comprised of senior secured unitranche loans of 19 and 14 different borrowers, respectively. As of September 30, 2018 and December 31, 2017, there were no loans on non-accrual status. The portfolio companies in ABCS are in industries similar to those in which the Company may invest directly. Below is a summary of ABCS’s portfolio, followed by a portfolio listing as of September 30, 2018 and December 31, 2017:

	As of
	September 30, 2018			December 31, 2017
Total first lien senior secured loans (1)	$	1,496,894,149		$	956,536,905
Weighted average yield on first lien unitranche loans (2)	8.3		%	8.1		%
Largest loan to a single borrower (1)	$	119,186,478		$	106,231,058
Total of five largest loans to borrowers (1)	$	559,029,976		$	465,635,606
Number of borrowers in the ABCS	19			14
Commitments to fund delayed draw loans (3)	$	43,700,328		$	25,087,777

(1) At principal amount.

(2) Based on par amount.

(3) As discussed above, these commitments have been approved by ABCS.

Table of Contents

Below is certain summarized financial information for ABCS as of September 30, 2018 and December 31, 2017 and for the three and nine months ended September 30, 2018:

Selected Balance Sheet Information

	As of
	September 30, 2018		December 31, 2017
Loans, net of allowance of $12,745,780 and $0, respectively (1)	$	1,474,881,810	$	956,184,609
Cash, restricted cash and other assets	40,707,358		33,348,801
Total assets	$	1,515,589,168	$	989,533,410
Debt (2)	$	926,058,511	$	587,657,029
Other liabilities	13,401,675		3,340,372
Total liabilities	$	939,460,186	$	590,997,401
Members’ equity	576,128,982		398,536,009
Total liabilities and members’ equity	$	1,515,589,168	$	989,533,410

(1) ABCS is not considered an investment company and does not follow the accounting and reporting guidelines in ASC 946. ABCS applies an allowance for loan loss methodology prescribed by FASB topic ASC 310, Receivables, and FASB ASC 450 Contingencies. The allowance for loan loss as of September 30, 2018 is a general allowance, there was no specific allowance for loan losses during the period. The Company estimates a fair value for each loan in the ABCS portfolio, which is presented in the Antares Bain Capital Complete Financing Solution schedule of investments below, which is an input to the Company’s valuation of ABCS as a whole.

(2) Net of $3.8 and $4.5 million deferred financing costs for the ABCS Facility, as of September 30, 2018 and December 31, 2017, respectively.

Selected Statement of Operations Information

	For the Three Months Ended		For the Nine Months Ended
	September 30, 2018		September 30, 2018
Interest income	$	29,224,155	$	72,352,543
Fee income	88,939		1,035,581
Total revenues	29,313,094		73,388,124
Credit facility expenses (1)	12,563,745		32,283,527
Other fees and expenses	13,848,375		16,326,361
Total expenses	26,412,120		48,609,888
Net investment income	2,900,974		24,778,236
Net realized gains	—		—
Net change in unrealized appreciation (depreciation) on investments	—		—
Net increase in members’ capital from operations	$	2,900,974	$	24,778,236

(1) As of September 30, 2018 and December 31 2017, the ABCS Facility had $929.8 million and $592.1 million of outstanding debt, respectively.

Loan Origination and Structuring Fees

ABCS is obligated to pay sourcing fees to the applicable member, or its affiliate, that sources the deal. For the three and nine months ended September 30, 2018, the Company did not earn any sourcing fees.

Table of Contents

Antares Bain Capital Complete Financing Solution

Schedule of Investments

As of September 30, 2018

(Unaudited)

Portfolio Company	Spread Above Index (1)	Interest Rate		Maturity Date	Principal/ Par Amount		Carrying Value		Fair Value (2)
Investments
Corporate Debt
Delayed Draw Term Loan
Capital Equipment
Winchester Electronics Corporation	L+ 6.50%	8.74	%	6/30/2022	$	11,209,129	11,209,128		11,209,129
Total Capital Equipment							11,209,128		11,209,129
Chemicals, Plastics & Rubber
PRCC Holdings, Inc. (6)	L+ 6.50%	8.75	%	2/1/2021	$	12,003,338	12,003,338		12,003,338
Total Chemicals, Plastics & Rubber							12,003,338		12,003,338
Consumer Goods: Non-Durable
Solaray, LLC (9)	L+ 6.50%	8.84	%	9/9/2023	$	25,689,049	25,530,436		25,689,049
Total Consumer Goods: Non-Durable							25,530,436		25,689,049
Media: Advertising, Printing & Publishing
Ansira Holdings, Inc.	L+ 5.75%	7.99	%	12/20/2022	$	2,480,981	2,480,981		2,480,981
Total Media: Advertising, Printing & Publishing							2,480,981		2,480,981
Services: Business
Element Buyer, Inc. (14)	—	—		7/19/2025	$	—	—		(63,334		)
McKissock, LLC	L+ 5.75%	8.14	%	8/5/2021	$	2,611,626	2,611,626		2,611,626
Total Services: Business							2,611,626		2,548,292
Transportation: Consumer
Direct Travel, Inc. (13)	L+ 6.50%	8.87	%	12/1/2021	$	1,678,445	1,678,445		1,678,445
Total Transportation: Consumer							1,678,445		1,678,445
Total Delayed Draw Term Loan							55,513,954		55,609,234

First lien senior secured loan
Aerospace & Defense
API Technologies Corp. (12)	L+ 6.00%	8.25	%	4/20/2024	$	118,454,372	117,084,473		117,862,100
Total Aerospace & Defense							117,084,473		117,862,100
Banking
Tidel Engineering, L.P.	L+ 6.25%	8.64	%	3/1/2024	$	80,924,185	80,924,185		81,733,427
Total Banking							80,924,185		81,733,427
Capital Equipment
Abracon Group Holding, LLC	L+ 5.75%	8.08	%	7/18/2024	$	81,700,860	80,517,278		80,883,851
Aramsco, Inc.	L+ 5.25%	7.49	%	8/28/2024	$	50,469,044	49,475,319		49,712,008
Winchester Electronics Corporation	L+ 6.50%	8.73	%	6/30/2022	$	84,286,513	84,182,091		84,286,513
Total Capital Equipment							214,174,688		214,882,372
Chemicals, Plastics & Rubber
AP Plastics Group, LLC	L+ 5.25%	7.35	%	8/1/2022	$	50,585,308	50,529,842		50,585,308
PRCC Holdings, Inc. (5)	L+ 6.50%	8.75	%	2/1/2021	$	74,600,327	74,600,327		74,600,327
Total Chemicals, Plastics & Rubber							125,130,169		125,185,635
Construction & Building
Stanton Carpet Corp. (11)	L+ 5.50%	7.79	%	11/21/2022	$	61,334,534	61,278,330		61,334,534
Total Construction & Building							61,278,330		61,334,534
Consumer Goods: Durable
Home Franchise Concepts, Inc.	L+ 5.00%	7.13	%	7/9/2024	$	72,381,714	72,033,992		71,657,897
Total Consumer Goods: Durable							72,033,992		71,657,897
Consumer Goods: Non-Durable
Solaray, LLC (8)	L+ 6.50%	8.83	%	9/9/2023	$	85,806,327	85,806,327		85,806,327
Total Consumer Goods: Non-Durable							85,806,327		85,806,327
Energy: Oil & Gas
Amspec Services, Inc.	L+ 5.75%	8.09	%	7/2/2024	$	90,250,950	89,161,196		88,445,931
Total Energy: Oil & Gas							89,161,196		88,445,931
Media: Advertising, Printing & Publishing
Ansira Holdings, Inc.	L+ 5.75%	7.99	%	12/20/2022	$	82,215,157	82,060,449		82,215,157
Cruz Bay Publishing, Inc. (3)	L+ 5.75%	8.11	%	6/6/2019	$	11,646,589	11,646,589		11,646,589
Cruz Bay Publishing, Inc. (4)	L+ 6.75%	9.16	%	6/6/2019	$	3,889,335	3,889,335		3,889,335
Total Media: Advertising, Printing & Publishing							97,596,373		97,751,081
Media: Diversified & Production
Efficient Collaborative Retail Marketing Company, LLC	L+ 6.75%	9.14	%	6/15/2022	$	23,030,252	23,030,252		22,857,525
Efficient Collaborative Retail Marketing Company, LLC	L+ 6.75%	9.14	%	6/15/2022	$	33,741,229	33,029,405		33,488,170
Total Media: Diversified & Production							56,059,657		56,345,695
Retail
Batteries Plus Holding Corporation	L+ 6.75%	8.83	%	7/6/2022	$	68,156,203	68,156,203		68,156,203
Total Retail							68,156,203		68,156,203
Services: Business
Element Buyer, Inc.	L+ 5.25%	7.50	%	7/19/2025	$	85,500,900	83,886,496		85,287,148
McKissock, LLC	L+ 5.75%	8.14	%	8/5/2021	$	8,091,711	8,091,711		8,091,711
McKissock, LLC	L+ 5.75%	8.14	%	8/5/2021	$	42,249,930	41,882,258		42,566,804
TEI Holdings Inc. (10)	L+ 6.00%	8.39	%	12/20/2023	$	119,186,478	118,486,535		118,888,511
Total Services: Business							252,347,000		254,834,174
Transportation: Consumer
Direct Travel, Inc. (7)	L+ 6.50%	8.84	%	12/1/2021	$	112,719,663	112,361,043		112,719,663
Total Transportation: Consumer							112,361,043		112,719,663
Total First lien senior secured loan							1,432,113,636		1,436,715,039

Total Corporate Debt							$	1,487,627,590	$	1,492,324,273
Total Investments							$	1,487,627,590	$	1,492,324,273

(1) The investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (“LIBOR” or “L”) which reset daily, monthly, quarterly or semiannually. For each, the Company has provided the spread over LIBOR and the current weighted average interest rate in effect at September 30, 2018. Certain investments are subject to a LIBOR interest rate floor.

(2) Fair Value determined by the Advisor.

(3) $158,063 of the total par amount for this security is at P + 4.75%.

(4) $52,785 of the total par amount for this security is at P + 5.75%.

(5) $393,462 of the total par amount for this security is at P + 5.50%.

(6) $62,615 of the total par amount for this security is at P + 5.50%.

(7) $283,215 of the total par amount for this security is at P + 5.50%.

(8) $218,341 of the total par amount for this security is at P + 5.50%.

(9) $64,715 of the total par amount for this security is at P + 5.50%.

(10) $298,713 of the total par amount for this security is at P + 5.00%.

(11) $1,494,638 of the total par amount for this security is at P + 5.50%.

(12) $296,878 of the total par amount for this security is at P + 5.00%.

(13) $2,229 of the total par amount for this security is at P + 5.50%.

(14) The negative fair value is the result of the capitalized discount on the loan or the unfunded commitment being valued below par.

Table of Contents

Antares Bain Capital Complete Financing Solution

Schedule of Investments

As of December 31, 2017

	Spread Above				Principal/
Portfolio Company	Index (1)	Interest Rate		Maturity Date	Par Amount		Amortized Cost		Fair Value (2)

Investments
Corporate Debt
Delayed Draw Term Loan
Capital Equipment
Winchester Electronics Corporation	L + 6.50%	8.17	%	6/30/2022	$	11,294,304	$	11,294,304	$	11,294,304
Total Capital Equipment							11,294,304		11,294,304
Chemicals, Plastics & Rubber
PRCC Holdings, Inc. (6)	L + 6.50%	8.08	%	2/1/2021	$	12,191,184	12,191,184		12,191,184
Total Chemicals, Plastics & Rubber							12,191,184		12,191,184
Consumer Goods: Non-Durable
Solaray, LLC	L + 6.50%	8.07	%	9/9/2023	$	15,496,531	15,496,531		15,496,531
Total Consumer Goods: Non-Durable							15,496,531		15,496,531
Media: Advertising, Printing & Publishing
Ansira Holdings, Inc.	L + 6.50%	8.19	%	12/20/2022	$	6,228,599	6,228,599		6,228,599
Total Media: Advertising, Printing & Publishing							6,228,599		6,228,599
Services: Business
McKissock, LLC	L + 6.00%	7.94	%	8/5/2019	$	2,631,338	2,631,338		2,631,338
Total Services: Business							2,631,338		2,631,338
Transportation: Consumer
Direct Travel, Inc.	L + 6.50%	8.01	%	12/1/2021	$	7,654,382	7,654,382		7,654,382
Total Transportation: Consumer							7,654,382		7,654,382
Total Delayed Draw Term Loan							$	55,496,338	$	55,496,338

First Lien Senior Secured Loan
Banking
Tidel Engineering, L.P.	L + 6.25%	7.94	%	3/1/2024	$	80,924,185	80,924,185		80,924,185
Total Banking							80,924,185		80,924,185
Capital Equipment
Winchester Electronics Corporation	L + 6.50%	8.19	%	6/30/2022	$	75,343,060	75,272,510		75,272,510
Total Capital Equipment							75,272,510		75,272,510
Chemicals, Plastics & Rubber
AP Plastics Group, LLC (3)	L + 6.25%	7.63	%	8/1/2022	$	50,972,104	50,972,104		50,972,104
PRCC Holdings, Inc. (5)	L + 6.50%	8.08	%	2/1/2021	$	75,780,714	75,780,714		75,780,714
Total Chemicals, Plastics & Rubber							126,752,818		126,752,818

Table of Contents

Construction & Building
Stanton Carpet Corp. (7)	L + 6.50%	8.07	%	11/21/2022	$	65,131,658	65,131,658		65,131,658
Total Construction & Building							65,131,658		65,131,658
Consumer Goods: Non-Durable
Solaray, LLC	L + 6.50%	8.00	%	9/9/2023	$	86,461,350	86,179,604		86,179,604
Total Consumer Goods: Non-Durable							86,179,604		86,179,604
Media: Advertising, Printing & Publishing
Ansira Holdings, Inc.	L + 6.50%	8.19	%	12/20/2022	$	76,608,806	76,608,806		76,608,806
Cruz Bay Publishing, Inc.	L + 5.75%	7.13	%	6/6/2019	$	12,170,869	12,170,869		12,170,869
Cruz Bay Publishing, Inc. (4)	L + 6.75%	8.47	%	6/6/2019	$	4,064,416	4,064,416		4,064,416
Total Media: Advertising, Printing & Publishing							92,844,091		92,844,091
Media: Diversified & Production
Efficient Collaborative Retail Marketing Company, LLC	L + 6.75%	8.44	%	6/15/2022	$	35,840,087	35,840,087		35,840,087
Total Media: Diversified & Production							35,840,087		35,840,087
Retail
Batteries Plus Holding Corporation	L + 6.50%	8.32	%	7/6/2022	$	68,677,806	68,677,806		68,677,806
Total Retail							68,677,806		68,677,806
Services: Business
McKissock, LLC	L + 6.00%	7.94	%	8/5/2019	$	8,152,786	8,152,786		8,152,786
McKissock, LLC	L + 6.00%	7.94	%	8/5/2019	$	17,100,285	17,100,285		17,100,285
TEI Holdings Inc. (8)	L + 6.50%	8.13	%	12/20/2023	$	74,173,614	74,173,614		74,173,614
Total Services: Business							99,426,685		99,426,685
Transportation: Cargo
ENC Holding Corporation	L + 6.50%	8.05	%	2/8/2023	$	71,062,151	71,062,151		71,062,151
Total Transportation: Cargo							71,062,151		71,062,151
Transportation: Consumer
Direct Travel, Inc.	L + 6.50%	7.95	%	12/1/2021	$	98,576,676	98,576,676		98,576,676
Total Transportation: Consumer							98,576,676		98,576,676
Total First Lien Senior Secured Loan							$	900,688,271	$	900,688,271
Total Corporate Debt							$	956,184,609	$	956,184,609
Total Investments							$	956,184,609	$	956,184,609

(1) The investments bear interest at a rate that may be determined by reference to the London Interbank Offered Rate (‘‘LIBOR’’ or ‘‘L’’) or the Prime Rate (‘‘Prime’’ or ‘‘P’’) which reset daily, monthly, quarterly or semiannually. For each, the Company has provided the spread over LIBOR and the current weighted average interest rate in effect at December 31, 2017. Certain investments are subject to a LIBOR or Prime interest rate floor.

(2) Fair Value determined by the Advisor.

(3) $128,932 of the total par amount for this security is at P + 5.25%.

(4) $52,785 of the total par amount for this security is at P + 5.75%.

(5) $393,462 of the total par amount for this security is at P + 5.50%.

(6) $62,615 of the total par amount for this security is at P + 5.50%.

(7) $163,237 of the total par amount for this security is at P + 5.50%.

(8) $186,836 of the total par amount for this security is at P + 5.50%.

Table of Contents

Note 4. Fair Value Measurements

Fair Value Disclosures

The following table presents fair value measurements of investments by major class, cash equivalents and derivatives as of September 30, 2018, according to the fair value hierarchy:

	Fair Value Measurements
	Level 1		Level 2		Level 3		Total
Investments:
First Lien Senior Secured Loans	$	—	$	345,730,180	$	423,066,994	$	768,797,174
First Lien Last Out Loans	—		—		30,397,170		30,397,170
Second Lien Senior Secured Loans	—		90,338,863		124,714,658		215,053,521
Subordinated Debt	—		—		24,700,000		24,700,000
Corporate Bonds	—		33,175,470		—		33,175,470
Investment Vehicles (1)	—		—		258,632,338		258,632,338
Equity Interest	—		—		18,616,855		18,616,855
Preferred Equity	—		—		2,070,053		2,070,053
Total Investments	$	—	$	469,244,513	$	882,198,068	$	1,351,442,581

Cash equivalents	$	148,411,966	$	—	$	—	$	148,411,966
Forward currency exchange contracts	$	—	$	5,618,287	$	—	$	5,618,287

(1) Represents equity investment in ABCS.

The following table presents fair value measurements of investments by major class, cash equivalents and derivatives as of December 31, 2017, according to the fair value hierarchy:

	Fair Value Measurements
	Level 1		Level 2			Level 3		Total
Investments:
First Lien Senior Secured Loans	$	—	$	269,980,309		$	215,339,087	$	485,319,396
First Lien Last Out Loans	—		—			30,515,994		30,515,994
Second Lien Senior Secured Loans	—		32,745,280			84,722,132		117,467,412
Corporate Bonds	—		8,138,880			—		8,138,880
Investment Vehicles (1)	—		—			178,409,807		178,409,807
Equity Interest	—		—			9,763,092		9,763,092
Preferred Equity	—		—			1,963,490		1,963,490
Total Investments	$	—	$	310,864,469		$	520,713,602	$	831,578,071

Cash equivalents	$	133,639,685	$	—		$	—	$	133,639,685
Forward currency exchange contracts (liability)	$	—	$	(3,504,814	)	$	—	$	(3,504,814	)

(1) Represents equity investment in ABCS.

Table of Contents

The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the nine months ended September 30, 2018:

	First Lien Senior Secured Loans			First Lien Last Out Loans			Second Lien Senior Secured Loans			Subordinated Debt			Investment Vehicles (1)			Equity Interest		Preferred Equity		Total Investments
Balance as of January 1, 2018	$	215,339,087		$	30,515,994		$	84,722,132		$	—		$	178,409,807		$	9,763,092	$	1,963,490	$	520,713,602
Purchases of investments and other adjustments to cost	309,220,076			422,300			57,391,480			24,700,000			79,574,411			7,678,182		—		478,986,449
Net accretion of discounts (amortization of premiums)	636,754			63,967			152,005			2,741			—			—		—		855,467
Proceeds from principal repayments and sales of investments	(104,816,384		)	(76,142		)	(17,069,909		)	—			(1,310,259		)	—		—		(123,272,694		)
Net change in unrealized appreciation (depreciation) on investments	(1,624,977		)	(528,949		)	(1,742,208		)	(2,741		)	1,958,379			1,175,581		106,563		(658,352		)
Net realized gains on investments	6,289			—			18,340			—			—			—		—		24,629
Transfers out of Level 3	(9,142,064		)	—			(13,458,168		)	—			—			—		—		(22,600,232		)
Transfers to Level 3	13,448,213			—			14,700,986			—			—			—		—		28,149,199
Balance as of September 30, 2018	$	423,066,994		$	30,397,170		$	124,714,658		$	24,700,000		$	258,632,338		$	18,616,855	$	2,070,053	$	882,198,068

Change in unrealized appreciation (depreciation) attributable to investments still held at September 30, 2018	$	(1,215,109	)	$	(528,949	)	$	(1,397,893	)	$	(2,741	)	$	1,958,379		$	1,175,581	$	106,563	$	95,831

(1) Represents equity investment in ABCS.

Transfers between levels, if any, are recognized at the beginning of the quarter in which transfers occur. For the nine months ended September 30, 2018, transfers from Level 2 to Level 3 were primarily due to decreased price transparency. For the nine months ended September 30, 2018, transfers from Level 3 to Level 2 were primarily due to increased price transparency.

The following table provides a reconciliation of the beginning and ending balances for investments that use Level 3 inputs for the nine months ended September 30, 2017:

	First Lien Senior Secured Loans			First Lien Last Out Loans		Second Lien Senior Secured Loans		Equity Interest		Total Investments
Balance as of January 1, 2017	$	32,735,307		$	—	$	—	$	—	$	32,735,307
Purchases of investments and other adjustments to cost	147,030,155			19,040,991		52,742,302		7,063,857		225,877,305
Net accretion of discounts (amortization of premiums)	248,403			10,916		31,200		—		290,519
Proceeds from principal repayments and sales of investments	(3,464,688		)	—		—		—		(3,464,688		)
Net change in unrealized appreciation on investments	4,184,224			828,894		1,139,157		—		6,152,275
Net realized gains on investments	15,638			—		—		—		15,638
Transfers from Level 3	—			—		—		—		—
Transfers to Level 3	20,429,583			—		1,685,081		—		22,114,664
Balance as of September 30, 2017	$	201,178,622		$	19,880,801	$	55,597,740	$	7,063,857	$	283,721,020

Change in unrealized appreciation attributable to investments still held at September 30, 2017	$	4,184,224		$	828,894	$	1,139,157	$	—	$	6,152,275

Transfers between levels, if any, are recognized at the beginning of the quarter in which transfers occur. For the nine months ended September 30, 2017, transfers from Level 2 to Level 3 were primarily due to decreased price transparency.

Significant Unobservable Inputs

ASC 820 requires disclosure of quantitative information about the significant unobservable inputs used in the valuation of assets and liabilities classified as Level 3 within the fair value hierarchy. Disclosure of this information is not required in circumstances where a valuation (unadjusted) is obtained from a third-party pricing service and the information regarding the unobservable inputs is not reasonably available to the Company and as such, the disclosures provided below exclude those investments valued in that manner.

Table of Contents

	As of September 30, 2018
	Fair Value of Level 3 Assets (1)		Valuation Technique	Significant Unobservable Inputs	Range of Significant Unobservable Inputs (Weighted Average (2))
First Lien Senior Secured Loans	$	263,277,140	Discounted Cash Flows	Comparative Yields	5.9%-12.5% (8.1%)
First Lien Senior Secured Loans	4,144,528		Comparable Company Multiple	Book Value Multiple	1x-1x (1x)
First Lien Senior Secured Loans	2,550,060		Collateral Analysis	Recovery Rate	100%
First Lien Last Out Loans	30,397,170		Discounted Cash Flows	Comparative Yields	9.8%-14.5% (12.8%)
Second Lien Senior Secured Loans	71,280,382		Discounted Cash Flows	Comparative Yields	9.2%-14.0% (11.0%)
Subordinated Debt	10,000,000		Discounted Cash Flows	Comparative Yields	13.5%-13.5% (13.5%)
Investment Vehicles (3)	258,632,338		Other	—	—
Equity Interest	1,886,400		Comparable Company Multiple	EBITDA Multiple	14.5x-14.5x (14.5x)
Equity Interest	12,732,985		Comparable Company Multiple	Book Value Multiple	1x-1x (1x)
Preferred Equity	2,070,053		Comparable Company Multiple	EBITDA Multiple	10.5x-10.5x (10.5x)
Total investments	$	656,971,056

(1) Included within the Level 3 assets of $882,198,068 is an amount of $225,227,012 for which the Advisor did not develop the unobservable inputs for the determination of fair value (examples include single source quotation and prior or pending transactions).

(2) Weighted average is calculated by weighing the significant unobservable input by the relative fair value of each investment in the category.

(3) Represents equity investment in ABCS. The Company determines the fair value of its investment in ABCS giving consideration to the assets and liabilities of ABCS, at fair value, including consideration of any necessary adjustments. The fair value of the loans held by ABCS have been determined based upon recent transactions or the use of discounted cash flows, with comparative yields ranging from 7.9% to 11.2% and a weighted average of 9.2%. The carrying value of the ABCS Facility approximates fair value.

The Company used the income approach and market approach to determine the fair value of certain Level 3 assets as of September 30, 2018. The significant unobservable input used in the income approach is the comparative yield. The comparative yield is used to discount the estimated future cash flows expected to be received from the underlying investment. An increase/decrease in the comparative yield would result in a decrease/increase, respectively, in the fair value. The significant unobservable input used in the market approach is the comparable company multiple. The multiple is used to estimate the enterprise value of the underlying investment. An increase/decrease in the multiple would result in an increase/decrease, respectively, in the fair value.

The valuation techniques and significant unobservable inputs used in Level 3 fair value measurements of assets as of December 31, 2017 were as follows:

	As of December 31, 2017
	Fair Value of Level 3 Assets (1)		Valuation Technique	Significant Unobservable Inputs	Range of Significant Unobservable Inputs (Weighted Average (2))
First Lien Senior Secured Loans	$	151,863,260	Discounted Cash Flows	Comparative Yields	3.3%-9.9% (7.6%)
First Lien Senior Secured Loans	1,837,216		Comparable Company Multiple	Book Value Multiple	1x-1x (1x)
First Lien Last Out Loans	20,256,052		Discounted Cash Flows	Comparative Yields	10.0%-10.0% (10.0%)
Second Lien Senior Secured Loans	48,767,181		Discounted Cash Flows	Comparative Yields	8.6%-12.5% (9.9%)
Equity Interest	8,263,092		Comparable Company Multiple	Book Value Multiple	1x-1x (1x)
Preferred Equity	1,963,490		Discounted Cash Flows	Comparative Yields	10.0%-10.0% (10.0%)
Total investments	$	232,950,291

(1) Included within the Level 3 assets of $520,713,602 is an amount of $287,763,311 for which the Advisor did not develop the unobservable inputs for the determination of fair value (examples include single source quotation and prior or pending transactions). Of the $287,763,311, $178,409,807 is due to the equity investment in ABCS.

(2) Weighted average is calculated by weighing the significant unobservable input by the relative fair value of each investment in the category.

The Company used the income approach and market approach to determine the fair value of certain Level 3 assets as of December 31, 2017. The significant unobservable input used in the income approach is the comparative yield. The comparative yield

Table of Contents

is used to discount the estimated future cash flows expected to be received from the underlying investment. An increase/decrease in the comparative yield would result in a decrease/increase, respectively, in the fair value. The significant unobservable input used in the market approach is the comparable company multiple. The multiple is used to estimate the enterprise value of the underlying investment. An increase/decrease in the multiple would result in an increase/decrease, respectively, in the fair value.

The fair values of the Revolving Credit Facility, BCSF Revolving Credit Facility and the 2018-1 Notes (as defined in Note 6), which are categorized as Level 3 within the fair value hierarchy as of September 30, 2018 and December 31, 2017, approximate the carrying value of such facilities.

Note 5. Related Party Transactions

Investment Advisory Agreement

The Company has entered into an investment advisory agreement as of October 6, 2016, (the “Investment Advisory Agreement”) with the Advisor, pursuant to which the Advisor manages the Company’s investment program and related activities.

Base Management Fee

The Company pays the Advisor a base management fee (the “Base Management Fee”), accrued and payable quarterly in arrears. The Base Management Fee is calculated at an annual rate of 1.50% (0.375% per quarter) of the average value of the Company’s gross assets (excluding cash and cash equivalents, but including assets purchased with borrowed amounts) at the end of each of the two most recently completed calendar quarters (and, in the case of our first quarter, our gross assets as of such quarter-end). Such amount shall be appropriately adjusted (based on the actual number of days elapsed relative to the total number of days in such calendar quarter) for any share issuance or repurchases by the Company during a calendar quarter. The Base Management Fee for any partial quarter will be appropriately prorated.

The Advisor, however, has contractually waived its right to receive the Base Management Fee in excess of 0.75% of the aggregate gross assets excluding cash (including capital drawn to pay the Company’s expenses) during any period prior to a Qualified IPO. A “Qualified IPO” is an initial public offering of the Company’s common stock that results in an unaffiliated public float of at least the lower of (A) $75 million and (B) 15% of the aggregate capital commitments received prior to the date of such initial public offering. If a Qualified IPO does not occur, such fee waiver will remain in place through liquidation of the Company. The Advisor will not be permitted to recoup any waived amounts at any time and the waiver agreement may only be modified or terminated prior to a Qualified IPO with the approval of the Board.

As of September 30, 2018 and December 31, 2017, $2.3 million and $1.2 million remained payable, respectively.

The following table provides a reconciliation of the Base Management Fee incurred by the Company and included on the statements of operations:

	Annualized Rate		For the three months ended September 30, 2018		For the three months ended September 30, 2017		For the nine months ended September 30, 2018		For the nine months ended September 30, 2017
Base Management Fee per the Investment Advisory Agreement, prior to reduction for periods prior to a Qualified IPO	1.50	%	4,639,082		1,712,520		11,642,768		3,409,950
Base Managemenet Fee reduction for periods prior to a Qualified IPO	(0.75	%)	(2,319,541	)	(856,260	)	(5,821,384	)	(1,704,975	)
Base Management Fee incurred by the Company and presented on the statement of operations	0.75	%	2,319,541		856,260		5,821,384		1,704,975

Incentive Fee

The incentive fee consists of two parts that are determined independently of each other such that one component may be payable even if the other is not.

The first part, the income incentive fee, is calculated and payable quarterly in arrears and equals:

(a) 100% of the excess of our pre-incentive fee net investment income for the immediately preceding calendar quarter, over a preferred return of 1.5% per quarter (6% annualized) (the “Hurdle”), until the Advisor has received a “catch-up” equal to:

(i) 15% of the pre-incentive fee net investment income for the current quarter prior to a Qualified IPO, or

(ii) 17.5% of the pre-incentive fee net investment income for the current quarter after a Qualified IPO; and

(b) (i) 15% of all remaining pre-incentive fee net investment income above the “catch-up” prior to a Qualified IPO, or

(ii) 17.5% of all remaining pre-incentive fee net investment income above the “catch-up” after a Qualified IPO.

Table of Contents

The second part, the capital gains incentive fee, is determined and payable in arrears as of the end of each fiscal year (or upon a Qualified IPO or termination of the Investment Advisory Agreement), and equals:

(a) prior to a Qualified IPO, 15% of the Company’s realized capital gains, if any, on a cumulative basis from inception through the end of the fiscal year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees (the “Cumulative Capital Gains”), or

(b) after a Qualified IPO, 17.5% of the Cumulative Capital Gains.

Incentive Fee on Pre-Incentive Fee Net Investment Income

Pre-incentive fee net investment income means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring, diligence and consulting fees or other fees that we receive from portfolio companies but excluding fees for providing managerial assistance) accrued during the calendar quarter, minus operating expenses for the quarter (including the Base Management Fee, any expenses payable under the Administration Agreement, and any interest expense and dividends paid on any outstanding preferred stock, but excluding the incentive fee). Pre-incentive fee net investment income includes, in the case of investments with a deferred interest feature such as market discount, original issue discount (“OID”), debt instruments with PIK interest, preferred stock with PIK dividends and zero-coupon securities, accrued income that the Company has not yet received in cash.

Pre-incentive fee net investment income does not include any realized or unrealized capital gains or losses or unrealized capital appreciation or depreciation. Because of the structure of the incentive fee, it is possible that the Company may pay an incentive fee in a quarter where the Company incurs a loss. For example, if the Company receives pre-incentive fee net investment income in excess of the Hurdle rate for a quarter, the Company will pay the applicable incentive fee even if the Company has incurred a loss in that quarter due to realized and unrealized capital losses.

Pre-incentive fee net investment income will be compared to a “Hurdle Amount” equal to the product of (i) the “hurdle rate” of 1.5% per quarter (6% annualized) and (ii) the Company’s net assets (defined as total assets less indebtedness and before taking into account any incentive fees payable during the period) at the end of the immediately preceding calendar quarter. If market interest rates rise, the Company may be able to invest our funds in debt instruments that provide for a higher return, which would increase our pre-incentive fee net investment income and make it easier for the Advisor to surpass the fixed hurdle rate and receive an incentive fee based on such net investment income. Our pre-incentive fee net investment income used to calculate this part of the incentive fee is also included in the amount of our total assets (other than cash but including assets purchased with borrowed amounts) used to calculate the Base Management Fee.

Prior to the occurrence of a Qualified IPO, the Company will pay the income incentive fee in each calendar quarter as follows:

· no income incentive fee in any calendar quarter in which the Company’s pre-incentive fee net investment income does not exceed the Hurdle Amount;

· 100% of the Company’s pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the Hurdle Amount but is less than or equal to an amount (the “Pre-Qualified IPO Catch-Up Amount”) determined on a quarterly basis by multiplying 1.7647% by the Company’s net asset value at the beginning of each applicable calendar quarter. The Pre-Qualified IPO Catch-Up Amount is intended to provide the Advisor with an incentive fee of 15% on all of the Company’s pre-incentive fee net investment income when the Company’s pre-incentive fee net investment income reaches the Pre-Qualified IPO Catch-Up Amount in any calendar quarter; and

· for any calendar quarter in which the Company’s pre-incentive fee net investment income exceeds the Pre-Qualified IPO Catch-Up Amount, the income incentive fee shall equal 15% of the amount of the Company’s pre-incentive fee net investment income for the calendar quarter.

On and after the occurrence of a Qualified IPO, the Company will pay the income incentive fee in each calendar quarter as follows:

· no income incentive fee in any calendar quarter in which the Company’s pre-incentive fee net investment income does not exceed the Hurdle Amount;

Table of Contents

with an incentive fee of 17.5% on all of the Company’s pre-incentive fee net investment income when the Company’s pre-incentive fee net investment income reaches the Post-Qualified IPO Catch-Up Amount in any calendar quarter; and

· for any calendar quarter in which the Company’s pre-incentive fee net investment income exceeds the Post-Qualified IPO Catch-Up Amount, the income incentive fee shall equal 17.5% of the amount of the Company’s pre-incentive fee net investment income for the calendar quarter.

These calculations will be appropriately pro-rated for any period of less than three months and adjusted for any share issuances or repurchases by the Company during the current quarter. The Company does not currently intend to institute a share repurchase program and share repurchases will be effected only in extremely limited circumstances in accordance with applicable law. If the Qualified IPO occurs on a date other than the first day of a calendar quarter, the income incentive fee shall be calculated for such calendar quarter at a weighted rate calculated based on the fee rates applicable before and after a Qualified IPO based on the number of days in such calendar quarter before and after a Qualified IPO.

For the three months ended September 30, 2018, the Company incurred $2.5 million of income incentive fees (before waivers), which are included in incentive fees on the consolidated statements of operations. The Advisor decided to voluntarily waive 25%, or $0.6 million, of the income incentive fees earned by the Advisor during the three months ended September 30, 2018. Such income incentive fee waiver is irrevocable and such waived income incentive fees will not be subject to recoupment in future periods. This income incentive fee waiver does not impact any income incentive fees earned by the Advisor in future periods.

For the nine months ended September 30, 2018, the Company incurred $6.1 million of income incentive fees (before waivers), which are included in incentive fees on the consolidated statements of operations. The Advisor has voluntarily waived $1.6 million of the income incentive fees earned by the Advisor during the nine months ended September 30, 2018. Such income incentive fee waiver is irrevocable and such waived income incentive fees will not be subject to recoupment in future periods. This income incentive fee waiver does not impact any income incentive fees earned by the Advisor in future periods.

As a result of the income incentive fee waivers, the Company incurred $1.9 million and $4.5 million of income incentive fees (after waivers) for the three and nine months ended September 30, 2018, respectively. The Company did not incur any income incentive fees for the three months or nine months ended September 30, 2017.

As of September 30, 2018 and December 31, 2017, there was $1.9 million and $0.0 million, respectively, related to the income incentive fee accrued in incentive fee payable on the consolidated statements of assets and liabilities.

On October 11, 2018, the Board approved, subject to completion of the Proposed Initial Public Offering, as defined in Note 13, an Amended and Restated Investment Advisory Agreement. Beginning with the calendar quarter that commences January 1, 2019, this Amended and Restated Investment Advisory Agreement incorporates (i) a three-year lookback provision and (ii) a cap on quarterly income incentive fee payments based on net realized or unrealized capital loss, if any, during the applicable three-year lookback period. See Note 13 “Subsequent Events”.

Annual Incentive Fee Based on Capital Gains

The second part of the incentive fee is a capital gains incentive fee that will be determined and payable in arrears in cash as of the end of each fiscal year (or upon termination of the Investment Advisory Agreement, as of the termination date), and equals (i) 15% of our realized capital gains as of the end of the fiscal year prior to a Qualified IPO, and (ii) 17.5% of our realized capital gains as of the end of the fiscal year after a Qualified IPO. In determining the capital gains incentive fee payable to the Advisor, the Company calculates the cumulative aggregate realized capital gains and cumulative aggregate realized capital losses since our inception, and the aggregate unrealized capital depreciation as of the date of the calculation, as applicable, with respect to each of the investments in our portfolio. For this purpose, cumulative aggregate realized capital gains, if any, equals the sum of the differences between the net sales price of each investment, when sold, and the cost of such investment. Cumulative aggregate realized capital losses equals the sum of the amounts by which the net sales price of each investment, when sold, is less than the cost of such investment. Aggregate unrealized capital depreciation equals the sum of the difference, if negative, between the valuation of each investment as of the applicable calculation date and the cost of such investment. At the end of the applicable year, the amount of capital gains that serves as the basis for our calculation of the capital gains incentive fee equals the cumulative aggregate realized capital gains less cumulative aggregate realized capital losses, less aggregate unrealized capital depreciation, with respect to our portfolio of investments. If this number is positive at the end of such year, then the capital gains incentive fee for such year will equal 15% before a Qualified IPO or 17.5% after a Qualified IPO, as applicable, of such amount, less the aggregate amount of any capital gains incentive fees paid in respect of our portfolio in all prior years.

If a Qualified IPO occurs on a date other than the first day of a fiscal year, a capital gains incentive fee shall be calculated as of the day before the Qualified IPO, with such capital gains incentive fee paid to the Advisor following the end of the fiscal year in which the Qualified IPO occurred. For the avoidance of doubt, such capital gains incentive fee shall be equal to 15% of the Company’s realized capital gains on a cumulative basis from inception through the day before the Qualified IPO, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gains incentive fees. Following a Qualified IPO, solely for the purposes of calculating the capital gains incentive fee, the Company will be deemed to have previously paid capital gains incentive fees prior to a Qualified IPO equal to the product obtained by multiplying (a) the actual aggregate amount of previously paid capital gains incentive fees for all periods prior to a Qualified IPO by (b) the percentage obtained by dividing (x) 17.5% by (y) 15%. In the event that the Investment Advisory Agreement shall terminate as

Table of Contents

of a date that is not a fiscal year end, the termination date shall be treated as though it were a fiscal year end for purposes of calculating and paying a capital gains incentive fee.

There was no capital gains incentive fee payable to the Advisor under the Investment Advisory Agreement as of September 30, 2018 and December 31, 2017.

U.S. GAAP requires that the incentive fee accrual consider the cumulative aggregate unrealized capital appreciation of investments or other financial instruments in the calculation, as an incentive fee would be payable if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the Investment Advisory Agreement (“GAAP Incentive Fee”). There can be no assurance that such unrealized appreciation will be realized in the future. Accordingly, such fee, as calculated and accrued, would not necessarily be payable under the Investment Advisory Agreement, and may never be paid based upon the computation of incentive fees in subsequent period.

For the three months ended September 30, 2018, there was an addition of $0.7 million in incentive fees related to the GAAP Incentive Fee, which is included in incentive fees on the consolidated statements of operations. For the three months ended September 30, 2017, the Company incurred $0.2 million of incentive fees related to the GAAP Incentive Fee, which is included in incentive fees on the consolidated statements of operations. For the nine months ended September 30, 2018, there was an addition of $0.1 million in incentive fees related to the GAAP Incentive Fee which is included in incentive fees on the consolidated statements of operations. For the nine months ended September 30, 2017, the Company incurred $0.4 million of incentive fees related to the GAAP Incentive Fee, which is included in incentive fees on the consolidated statements of operations. As of September 30, 2018 and December 31, 2017, there was $1.0 million and $1.0 million related to the GAAP Incentive Fee accrued in incentive fee payable on the consolidated statements of assets and liabilities.

Administration Agreement

The Company has entered into an administration agreement (the “Administration Agreement”) with the Administrator, pursuant to which the Administrator provides the administrative services necessary for us to operate, and the Company will utilize the Administrator’s office facilities, equipment and recordkeeping services. Pursuant to the Administration Agreement, the Administrator has agreed to oversee our public reporting requirements and tax reporting and monitor our expenses and the performance of professional services rendered to us by others. To the extent that expenses to be borne by the Company are paid by the Administrator, the Company will generally reimburse the Administrator for such expenses. The Administrator has also hired a sub-administrator to assist in the provision of administrative services. The Company may reimburse the Administrator for its costs and expenses and our allocable portion of overhead incurred by it in performing its obligations under the Administration Agreement, including compensation paid to or compensatory distributions received by our officers (including our Chief Compliance Officer and Chief Financial Officer) and any of their respective staff who provide services to the Company, operations staff who provide services to us, and internal audit staff, if any, to the extent internal audit performs a role in our Sarbanes-Oxley internal control assessment. Our allocable portion of overhead will be determined by the Administrator, which expects to use various methodologies such as allocation based on the percentage of time certain individuals devote, on an estimated basis, to the business and affairs of the Company, and will be subject to oversight by the Board. The sub-administrator is paid its compensation for performing its sub-administrative services under the sub-administration agreement. The Company incurred expenses related to the sub-administrator of $0.4 million and $0.2 million for the three months ended September 30, 2018 and 2017, respectively, which is included in professional fees on the consolidated statement of operations. The Company incurred expenses related to the sub-administrator of $0.8 million and $0.5 million for the nine months ended September 30, 2018 and 2017, respectively, which is included in professional fees on the consolidated statement of operations. The Administrator will not be reimbursed to the extent that any such reimbursements would cause any distributions to our stockholders to constitute a return of capital. In addition, the Administrator is permitted to delegate its duties under the Administration Agreement to affiliates or third parties and the Company will reimburse the expenses of these parties incurred and paid by the Advisor on our behalf.

Co-investments

We may invest alongside our affiliates, subject to compliance with applicable regulations and our allocation procedures. Certain types of negotiated co-investments may be made only in accordance with the terms of the exemptive order we received from the SEC initially on August 23, 2016, as amended on March 23, 2018 (the “Order”). Under the terms of the Order, a “required majority” (as defined in Section 57(o) of the 1940 Act) of our independent directors must be able to reach certain conclusions in connection with a co-investment transaction, including that (1) the terms of the proposed transaction are reasonable and fair to us and our stockholders and do not involve overreaching of our or its stockholders on the part of any person concerned, and (2) the transaction is consistent with the interests of our stockholders and is consistent with our Board’s approved criteria. In certain situations where co-investment with one or more funds managed by the Advisor or its affiliates is not covered by the Order, the personnel of the Advisor or its affiliates will need to decide which fund will proceed with the investment. Such personnel will make these

Table of Contents

determinations based on policies and procedures, which are designed to reasonably ensure that investment opportunities are allocated fairly and equitably among affiliated funds over time and in a manner that is consistent with applicable laws, rules and regulations.

Related Party Commitments

The Advisor has made commitments of $10.8 million to the Company as of September 30, 2018 and December 31, 2017, of which $7.8 million and $4.8 million have been called by the Company as of September 30, 2018 and December 31, 2017, respectively. As of September 30, 2018 and December 31, 2017, the Advisor held 389,428.14 and 241,527.73 shares of the Company’s common stock, respectively. An affiliate of the Advisor is the investment manager to certain pooled investment vehicles which are investors in the Company. Collectively, these investors have made commitments to the Company of $555.3 million as of September 30, 2018 and December 31, 2017 of which $388.7 million and $222.1 million, respectively, has been called by the Company as of September 30, 2018 and December 31, 2017, respectively. These investors held 19,295,326.27 and 11,070,200.25 shares of the Company at September 30, 2018 and December 31, 2017, respectively.

Controlled Affiliate Investments

Transactions during the nine months ended September 30, 2018 in which the issuer was both an Affiliated Person, as defined in the 1940 Act, and a portfolio company that the Company is deemed to Control are as follows:

		Fair Value							Change in					Fair Value
	Principal/	as of							Unrealized					as of		Dividend and
	Par Amount/	December 31,		Gross		Gross			Gains			Realized Gains		September 30,		Interest		Other
Portfolio Company	Shares	2017		Addition		Reductions			(Losses)			(Losses)		2018		Income		Income
Antares Bain Capital Complete Financing Solution LLC, Investment Vehicle	256,316,439	$	178,409,807	$	79,574,411	$	(1,310,260	)	$	1,958,380		$	—	$	258,632,338	$	16,044,764	$	—
BCC Jetstream Holdings Aviation (On II), LLC, Unfunded Commitment (1)	—	—		—		—			—			—		—		—		—
BCC Jetstream Holdings Aviation (On II), LLC, Equity Interest	731,387	424,261		407,172		—			606,407			—		1,437,840		13,627		13
BCC Jetstream Holdings Aviation (On II), LLC, First Lien Senior Secured Loan	4,144,528	1,837,216		2,307,312		—			—			—		4,144,528		194,898		—
BCC Jetstream Holdings Aviation (Off I), LLC, Equity Interest	11,862,614	7,838,831		4,459,110		—			(1,002,796		)	—		11,295,145		286,833		16
Total		$	188,510,115	$	86,748,005	$	(1,310,260	)	$	1,561,991		$	—	$	275,509,851	$	16,540,122	$	29

(1) Non-income producing.

Transactions during the year ended December 31, 2017 in which the issuer was both an Affiliated Person, as defined in the 1940 Act, and a portfolio company that the Company is deemed to Control are as follows:

		Fair Value							Change in				Fair Value
	Principal/	as of							Unrealized				as of		Dividend and
	Par Amount/	December 31,		Gross		Gross			Gains		Realized Gains		December 31,		Interest		Other
Portfolio Company	Shares	2016		Addition		Reductions			(Losses)		(Losses)		2017		Income		Income
Antares Bain Capital Complete Financing Solution LLC, Investment Vehicle (1)	178,052,288	$	—	$	178,052,288	$	—		$	357,519	$	—	$	178,409,807	$	—	$	—
BCC Jetstream Holdings Aviation (On II), LLC, Unfunded Commitment (1)	—	—		—		—			—		—		—		—		—
BCC Jetstream Holdings Aviation (On II), LLC, Equity Interest	324,214	—		368,588		(44,374		)	100,047		—		424,261		—		1,115
BCC Jetstream Holdings Aviation (On II), LLC, First Lien Senior Secured Loan	1,837,216	—		2,088,667		(251,451		)	—		—		1,837,216		55,308		6,318
BCC Jetstream Holdings Aviation (Off I), LLC, Equity Interest	7,403,505	—		8,724,172		(1,320,667		)	435,326		—		7,838,831		—		33,183
Total		$	—	$	189,233,715	$	(1,616,492	)	$	892,892	$	—	$	188,510,115	$	55,308	$	40,616

(1) Non-income producing.

Note 6. Borrowings

In accordance with applicable SEC staff guidance and interpretations, as a BDC, with certain exceptions, the Company is currently allowed to borrow amounts such that its asset coverage ratio, as defined in the 1940 Act, is at least 200% after such borrowing, unless the Company meets certain disclosure and approval requirements in which case the Company may reduce its asset coverage ratio to 150%. As of September 30, 2018 and December 31, 2017, the Company’s asset coverage ratio based on aggregated borrowings outstanding was 247% and 212%, respectively.

Table of Contents

The Company’s outstanding borrowings as of September 30, 2018 and December 31, 2017 were as follows:

	As of September 30, 2018						As of December 31, 2017
	Total Aggregate Principal Amount Committed		Principal Amount Outstanding		Carrying Value (1)		Total Aggregate Principal Amount Committed		Principal Amount Outstanding		Carrying Value
Revolving Credit Facility	$	85,000,000	$	83,639,250	$	83,639,250	$	150,000,000	$	150,000,000	$	150,000,000
BCSF Revolving Credit Facility	500,000,000		150,000,000		150,000,000		500,000,000		301,000,000		301,000,000
2018-1 Notes	365,700,000		365,700,000		363,615,956		—		—		—
Total Debt	$	950,700,000	$	599,339,250	$	597,255,206	$	650,000,000	$	451,000,000	$	451,000,000

(1) Carrying value represents aggregate principal amount outstanding less unamortized debt issuance costs

The combined weighted average interest rate (excluding deferred upfront financing costs and unused fees) of the aggregate borrowings outstanding for the nine months ended September 30, 2018 and year ended December 31, 2017 were 4.23% and 3.40%, respectively.

The following table shows the contractual maturities of our debt obligations as of September 30, 2018:

	Payments Due by Period
	Total		Less than 1 year		1 — 3 years		3 — 5 years		More than 5 years
Revolving Credit Facility	$	83,639,250	$	—	$	83,639,250	$	—	$	—
BCSF Revolving Credit Facility	150,000,000		—		—		150,000,000		—
2018-1 Notes	365,700,000		—		—		—		365,700,000
Total Debt Obligations	$	599,339,250	$	—	$	83,639,250	$	150,000,000	$	365,700,000

Revolving Credit Agreement

On December 22, 2016, we entered into the revolving credit agreement (“Revolving Credit Agreement”). The maximum commitment amount under the revolving credit facility (the “Revolving Credit Facility”) was $150.0 million, and may be increased up to $350.0 million (“Maximum Commitment”) with the consent of Sumitomo Mitsui Banking Corporation (“SMBC”) or reduced upon request of the Company. Effective July 31, 2018, we reduced the commitment amount under the Revolving Credit Facility to $85.0 million. Proceeds under the Revolving Credit Facility may be used for any purpose permitted under our organizational documents, including general corporate purposes such as the making of investments. The Revolving Credit Agreement contains certain covenants, including, but not limited to, maintaining an asset coverage ratio of total assets to total borrowings of at least 200%. As of September 30, 2018 and December 31, 2017, we were in compliance with these covenants. The Company’s obligations under the Revolving Credit Agreement are secured by the capital commitments and capital contributions to the Company.

Borrowings under the Revolving Credit Facility bear interest at the London Interbank Offered Rate (“LIBOR”) plus a margin. As of September 30, 2018 and December 31, 2017, the Revolving Credit Facility was accruing interest expense at a rate of LIBOR plus 1.40%. We pay an unused commitment fee of: (a) where the Maximum Commitment which is unused on such date is greater than fifty (50) percent of the Maximum Commitment, a rate of 20 basis points (0.20%) per annum; or (b) where the Maximum Commitment which is unused on such date is less than or equal to fifty (50) percent of the Maximum Commitment, a rate of 15 basis points (0.15%) per annum. Interest is payable in arrears either on a one month, two month, three month or six month LIBOR period. Any amounts borrowed under the Revolving Credit Facility, and all accrued and unpaid interest, will be due and payable, on the earliest of: (a) December 22, 2019; (b) the date upon which SMBC declares the obligations, or the obligations become, due and payable after the occurrence of an event of default under the Revolving Credit Facility; (c) the date upon which we terminate the commitments under the Revolving Credit Facility; and (d) 45 days prior to the earlier of (1) the date upon which the commitment period under the Subscription Agreements, as defined in Note 9, terminates and (2) the date upon which the ability to make capital calls and receive capital contributions otherwise terminates.

As of September 30, 2018, we have $83.6 million outstanding on the Revolving Credit Facility and we were in compliance with the terms of the Revolving Credit Facility. As of December 31, 2017, we had $150.0 million outstanding on the Revolving Credit Facility and we were in compliance with the terms of the Revolving Credit Facility. We intend to continue to utilize the Revolving Credit Facility on a revolving basis to fund investments and for other general corporate purposes.

Costs of $1.1 million were incurred in connection with obtaining the Revolving Credit Agreement which have been recorded as deferred financing costs on the consolidated statements of assets and liabilities and are being amortized over the life of the Revolving Credit Facility using the straight-line method. The balance of the unamortized deferred financing costs related to the Revolving Credit Agreement were $0.4 million and $0.7 million as of September 30, 2018 and December 31, 2017, respectively.

For the three months ended September 30, 2018 and 2017, the components of interest expense related to the Revolving Credit Facility were as follows:

	For the Three Months Ended September 30,
	2018		2017
Borrowing interest expense	$	834,481	$	60,412
Unused facility fee	5,162		71,300
Amortization of deferred financing costs and upfront commitment fees	92,233		92,233
Total interest and debt financing expenses	$	931,876	$	223,945

Table of Contents

For the nine months ended September 30, 2018 and 2017, the components of interest expense related to the Revolving Credit Facility were as follows:

	For the Nine Months Ended September 30,
	2018		2017
Borrowing interest expense	$	2,900,058	$	133,065
Unused facility fee	22,083		215,096
Amortization of deferred financing costs and upfront commitment fees	273,692		273,692
Total interest and debt financing expenses	$	3,195,833	$	621,853

BCSF Revolving Credit Facility

On October 4, 2017, we entered into the revolving credit agreement (the “BCSF Revolving Credit Facility”) with the Company as equity holder, BCSF I, LLC, a Delaware limited liability company and a wholly owned and consolidated subsidiary of the Company, as borrower, and Goldman Sachs Bank USA, as sole lead arranger (“Goldman Sachs”). The BCSF Revolving Credit Facility was subsequently amended on May 15, 2018 to reflect certain clarifications regarding margin requirements and hedging currencies. The maximum commitment amount under the BCSF Revolving Credit Facility is $500.0 million, and may be increased up to $750.0 million. Proceeds of the loans under the BCSF Revolving Credit Facility may be used to acquire certain qualifying loans and such other uses as permitted under the BCSF Revolving Credit Facility. The BCSF Revolving Credit Facility includes customary affirmative and negative covenants, including certain limitations on the incurrence of additional indebtedness and liens, as well as usual and customary events of default for revolving credit facilities of this nature. As of September 30, 2018, the Company was in compliance with these covenants.

Borrowings under the BCSF Revolving Credit Facility bear interest at LIBOR plus a margin. As of September 30, 2018 and December 31, 2017, the BCSF Revolving Credit Facility was accruing interest expense at a rate of LIBOR plus 2.50%. We pay an unused commitment fee of 30 basis points (0.30%) per annum. Interest is payable quarterly in arrears. Any amounts borrowed under the BCSF Revolving Credit Facility, and all accrued and unpaid interest, will be due and payable, on the earliest of: (a) October 5, 2022 and (b) the date upon which all loans shall become due and payable in full, whether by acceleration or otherwise.

As of September 30, 2018 and December 31, 2017, there were $150.0 million and $301.0 million borrowings under the BCSF Revolving Credit Facility, respectively, and we were in compliance with the terms of the BCSF Revolving Credit Facility. We intend to continue to utilize the BCSF Revolving Credit Facility on a revolving basis to fund investments and for other general corporate purposes.

Costs of $5.5 million were incurred in connection with obtaining the BCSF Revolving Credit Facility which have been recorded as deferred financing costs on the consolidated statements of assets and liabilities and are being amortized over the life of the BCSF Revolving Credit Facility using the straight-line method. The balance of the unamortized deferred financing costs related to the BCSF Revolving Credit Facility were $4.3 million and $5.1 million as of September 30, 2018 and December 31, 2017, respectively.

For the three months ended September 30, 2018 and 2017, the components of interest expense related to the BCSF Revolving Credit Facility were as follows:

	For the Three Months Ended September 30,
	2018		2017
Borrowing interest expense	$	5,130,280	$	—
Unused facility fee	64,442		—
Amortization of deferred financing costs and upfront commitment fees	269,219		—
Total interest and debt financing expenses	$	5,463,941	$	—

For the nine months ended September 30, 2018 and 2017, the components of interest expense related to the BCSF Revolving Credit Facility were as follows:

	For the Nine Months Ended September 30,
	2018		2017
Borrowing interest expense	$	11,633,474	$	—
Unused facility fee	381,750		—
Amortization of deferred financing costs and upfront commitment fees	798,879		—
Total interest and debt financing expenses	$	12,814,103	$	—

Table of Contents

2018-1 Notes

On September 28, 2018, (the “2018-1 Closing Date”), the Company, through BCC Middle Market CLO 2018-1 LLC (the “2018-1 Issuer”), a Delaware limited liability company and a wholly owned and consolidated subsidiary of the Company, completed its $451.2 million term debt securitization (the “CLO Transaction”). The notes issued in connection with the CLO Transaction (the “2018-1 Notes”) are secured by a diversified portfolio of the Issuer consisting primarily of middle market loans and participation interests in middle market loans, the majority of which are senior secured loans (the “2018-1 Portfolio”). At the 2018-1 Closing Date, the 2018-1 Portfolio was comprised of assets transferred from the Company and its consolidated subsidiaries. All transfers were eliminated in consolidation and there were no realized gains or losses recognized in the CLO Transaction.

The CLO Transaction was executed through a private placement of the following 2018-1 Notes:

2018-1 Notes	Principal Amount		Spread above Index	Interest rate at September 30, 2018
Class A-1 A	$	205,900,000	1.55% + 3 Month LIBOR	3.7624	%
Class A-1 B		45,000,000	1.50% + 3 Month LIBOR (first 24 months) 1.80% + 3 Month LIBOR (thereafter)	3.7124	%
Class A-2		55,100,000	2.15% + 3 Month LIBOR	4.3624	%
Class B		29,300,000	3.00% + 3 Month LIBOR	5.2124	%
Class C		30,400,000	4.00% + 3 Month LIBOR	6.2124	%
Total 2018-1 Notes		365,700,000
Membership Interests		85,450,000	Non-interest bearing	Not applicable
Total	$	451,150,000

The Class A-1 A, A-1 B, A-2, B and C 2018-1 Notes were issued at par and are scheduled to mature on October 20, 2030. The Company received 100% of the membership interests (the “Membership Interests”) in the 2018-1 Issuer in exchange for its sale to the 2018-1 Issuer of the initial closing date loan portfolio. The Membership Interests do not bear interest.

The Class A-1 A, A-1 B, A-2, B and C 2018-1 Notes are included in the consolidated financial statements. The Membership Interests are eliminated in consolidation.

On the 2018-1 Closing Date, the Company used $311.0 million of the net proceeds to prepay a portion of the BCSF Revolving Facility and Issuer transferred to the Company a portion of the net cash proceeds received from the sale of the 2018-1 Notes.

The Company serves as portfolio manager of the 2018-1 Issuer pursuant to a portfolio management agreement between the Company and the 2018-1 Issuer. For so long as the Company serves as portfolio manager, the Company will not charge any management fee or subordinated interest to which it may be entitled.

During the reinvestment period (four years from the closing date of the CLO Transaction), pursuant to the indenture governing the 2018-1 Notes, all principal collections received on the underlying collateral may be used by the 2018-1 Issuer to purchase new collateral under the direction of the Company in its capacity as portfolio manager of the 2018-1 Issuer and in accordance with the 2018-1 Issuer’s investment strategy and the terms of the indenture.

The Company has agreed to hold on an ongoing basis the Membership Interests with an aggregate dollar purchase price at least equal to 5% of the aggregate amount of all obligations issued by the 2018-1 Issuer for so long as the 2018-1 Notes remain outstanding.

The 2018-1 Issuer pays ongoing administrative expenses to the trustee, independent accountants, legal counsel, rating agencies and independent managers in connection with developing and maintaining reports, and providing required services in connection with the administration of the 2018-1 Issuer.

As of September 30, 2018, there were 69 first lien and second lien senior secured loans with a total fair value of approximately $423.8 million and cash of $37.7 million securing the 2018-1 Notes. Such assets are included in the Company’s consolidated financial statements. The creditors of the 2018-1 Issuer have received security interests in such assets and such assets are not intended to be available to the creditors of the Company (or an affiliate of the Company). The 2018-1 Portfolio must meet certain requirements, including asset mix and concentration, term, agency rating, collateral coverage, minimum coupon, minimum spread and sector diversity requirements in the indenture governing the 2018-1 Notes. As of September 30, 2018, the Company was in compliance with its covenants related to the 2018-1 Notes.

Costs of $2.1 million were incurred in connection with debt securitization of the 2018-1 Notes by the 2018-1 Issuer which have been recorded as debt issuance costs and presented as a reduction to the outstanding principal amount of the 2018-1 Notes on the consolidated statements of assets and liabilities and are being amortized over the life of the 2018-1 Issuer using the effective interest method. The balance of the unamortized deferred financing costs related to the 2018-1 Issuer was $2.1 million as of September 30, 2018. The 2018-1 Issuer was not in existence as of December 31, 2017 and the 2018-1 Notes were not outstanding.

Table of Contents

For the three months ended September 30, 2018 and 2017, the components of interest expense related to the 2018-1 Issuer were as follows:

	For the Three Months Ended September 30,
	2018		2017
Borrowing interest expense	$	126,974	$	—
Amortization of deferred financing costs and upfront commitment fees	947		—
Total interest and debt financing expenses	$	127,921	$	—

For the nine months ended September 30, 2018 and 2017, the components of interest expense related to the 2018-1 Issuer were as follows:

	For the Nine Months Ended September 30,
	2018		2017
Borrowing interest expense	$	126,974	$	—
Amortization of deferred financing costs and upfront commitment fees	947		—
Total interest and debt financing expenses	$	127,921	$	—

Note 7. Derivatives

The Company is subject to foreign currency exchange rate risk in the normal course of pursuing its investment objectives. The value of foreign investments held by the Company may be significantly affected by changes in foreign currency exchange rates. The dollar value of a foreign security generally decreases when the value of the dollar rises against the foreign currency in which the security is denominated and tends to increase when the value of the dollar declines against such foreign currency.

The Company may enter into forward currency exchange contracts to reduce the Company’s exposure to foreign currency exchange rate fluctuations in the value of foreign currencies, as described in Note 2. The fair value of derivative contracts open as of September 30, 2018 and December 31, 2017 is included on the consolidated schedule of investments by contract. The Company posted collateral of $0.8 million and $4.4 million with the counterparties on foreign currency exchange contracts at September 30, 2018 and December 31, 2017, respectively. Collateral amounts posted are included in collateral on forward currency exchange contracts on the consolidated statements of assets and liabilities.

For the three and nine months ended September 30, 2018, the Company’s average U.S. dollar notional exposure to forward currency exchange contracts was $124.3 million and $97.1 million, respectively. For the three and nine months ended September 30, 2017, the Company’s average U.S. dollar notional exposure to forward currency exchange contracts was $44.3 million and $25.6 million, respectively.

By using derivative instruments, the Company is exposed to the counterparty’s credit risk—the risk that derivative counterparties may not perform in accordance with the contractual provisions offset by the value of any collateral received. The Company’s exposure to credit risk associated with counterparty non-performance is limited to collateral posted and the unrealized gains inherent in such transactions that are recognized in the consolidated statements of assets and liabilities. The Company minimizes counterparty credit risk through credit monitoring procedures, executing master netting arrangements and managing margin and collateral requirements, as appropriate.

The Company presents forward currency exchange contracts on a net basis by counterparty on the consolidated statements of assets and liabilities. The Company has elected not to offset assets and liabilities in the consolidated statements of assets and liabilities that may be received or paid as part of collateral arrangements, even when an enforceable master netting arrangement or other arrangement is in place that provides the Company, in the event of counterparty default, the right to liquidate collateral and the right to offset a counterparty’s rights and obligations.

Table of Contents

The following table presents both gross and net information about derivative instruments eligible for offset in the consolidated statements of assets and liabilities as of September 30, 2018.

Counterparty	Account in the consolidated statements of assets and liabilities	Gross amount of assets on the consolidated statements of assets and liabilities		Gross amount of (liabilities) on the consolidated statements of assets and liabilities		Net amount of assets or (liabilities) presented on the consolidated statements of assets and liabilities		Cash Collateral paid (received) (1)		Net Amounts (2)
Bank of New York	Unrealized appreciation on forward currency contracts	$	2,427,071	$	—	$	2,427,071	$	—	$	2,427,071
Citibank	Unrealized appreciation on forward currency contracts	$	1,711,908	$	—	$	1,711,908	$	—	$	1,711,908
Goldman Sachs	Unrealized appreciation on forward currency contracts	$	1,479,308	$	—	$	1,479,308	$	—	$	1,479,308

(1) Amount excludes excess cash collateral paid.

(2) Net amount represents the net amount due (to) from counterparty in the event of default based on the contractual set-off rights under the agreement. Net amount excludes any over-collateralized amounts.

The following table presents both gross and net information about derivative instruments eligible for offset in the consolidated statements of assets and liabilities as of December 31, 2017.

Counterparty	Account in the consolidated statements of assets and liabilities	Gross amount of assets on the consolidated statements of assets and liabilities		Gross amount of (liabilities) on the consolidated statements of assets and liabilities			Net amount of assets or (liabilities) presented on the consolidated statements of assets and liabilities			Cash Collateral paid (received) (1)		Net Amounts (2)
Bank of New York	Unrealized depreciation on forward currency contracts	$	—	$	(2,877,294	)	$	(2,877,294	)	$	2,877,294	$	—
Citibank	Unrealized depreciation on forward currency contracts	$	—	$	(627,520	)	$	(627,520	)	$	627,520	$	—

(1) Amount excludes excess cash collateral paid.

The effect of transactions in derivative instruments to the consolidated statements of operations during the three months ended September 30, 2018 and 2017 was as follows:

	For the Three Months Ended September 30,
	2018		2017
Net realized gain on forward currency exchange contracts	$	177,172	$	—
Net change in unrealized appreciation (depreciation) on forward currency exchange contracts	1,529,008		(1,234,706		)
Total net realized and unrealized gains (losses) on forward currency exchange contracts	$	1,706,180	$	(1,234,706	)

Included in total net gains (losses) on the consolidated statements of operations is net gains (losses) of ($1.4 million) and $1.4 million related to realized and unrealized gains and losses on investments, foreign currency holdings and non-investment assets and liabilities attributable to the changes in foreign currency exchange rates for the three months ended September 30, 2018 and 2017, respectively. Including the total net realized and unrealized gains (losses) on forward currency exchange contracts of $1.7 million and ($1.2) million included in the above table, the net impact of foreign currency on total net gains (losses) on the consolidated statements of operations is $0.3 million and $0.2 million for the three months ended September 30, 2018 and September 30, 2017, respectively.

The effect of transactions in derivative instruments to the consolidated statements of operations during the nine months ended September 30, 2018 and 2017 was as follows:

	For the Nine Months Ended September 30,
	2018			2017
Net realized loss on forward currency exchange contracts	$	(2,695,967	)	$	(220,006	)
Net change in unrealized appreciation (depreciation) on forward currency exchange contracts	9,123,101			(2,643,944		)
Total net realized and unrealized gains (losses) on forward currency exchange contracts	$	6,427,134		$	(2,863,950	)

Included in total net gains (losses) on the consolidated statements of operations is net gains (losses) of ($5.1 million) and $3.1 million related to realized and unrealized gains and losses on investments, foreign currency holdings and non-investment assets and liabilities attributable to the changes in foreign currency exchange rates for the nine months ended September 30, 2018 and 2017, respectively. Including the total net realized and unrealized gains (losses) on forward currency exchange contracts of $6.4 million and ($2.9) million included in the above table, the net impact of foreign currency on total net gains (losses) on the consolidated statements of operations is $1.3 million and $0.2 million for the nine months ended September 30, 2018 and September 30, 2017, respectively.

Table of Contents

Note 8. Distributions

The Company’s distributions are recorded on the record date. The following table summarizes distributions declared during the nine months ended September 30, 2018:

Date Declared	Record Date	Payment Date	Amount Per Share		Total Distributions
March 28, 2018	March 28, 2018	May 17, 2018	$	0.34	$	10,609,643
June 28, 2018	June 28, 2018	August 10, 2018	$	0.36	$	13,484,328
September 26, 2018	September 26, 2018	October 19, 2018	$	0.41	$	17,966,855
Total distributions declared			$	1.11	$	42,060,826

The Company’s distributions are recorded on the record date. The following table summarizes distributions declared during the nine months ended September 30, 2017:

Date Declared	Record Date	Payment Date	Amount Per Share		Total Distributions
May 9, 2017	May 12, 2017	May 19, 2017	$	0.07	$	1,174,052
June 21, 2017	June 29, 2017	August 11, 2017	$	0.11	$	2,739,972
September 27, 2017	September 28, 2017	November 14, 2017	$	0.21	$	5,235,687
Total distributions declared			$	0.39	$	9,149,711

The federal income tax characterization of distributions declared and paid for the fiscal year will be determined at fiscal year-end based upon the investment company taxable income for the full fiscal year and distributions paid during the full year.

Note 9. Common Stock/Capital

The Company has authorized 100,000,000,000 shares of its common stock with a par value of $0.001 per share. The Company has authorized 10,000,000,000 shares of its preferred stock with a par value of $0.001 per share. Shares of preferred stock have not been issued.

Since October 2016, the Company has issued 43,821,595.55 shares in the private placement of the Company’s common shares (the “Private Offering”). Each investor has entered into a separate subscription agreement relating to the Company’s common stock (the “Subscription Agreements”). Each investor has made a capital commitment to purchase shares of the Company’s common stock pursuant to the Subscription Agreements. Investors will be required to make capital contributions to purchase shares of the Company’s common stock each time the Company delivers a drawdown notice, which will be delivered at least 10 business days prior to the required funding date in an aggregate amount not to exceed their respective capital commitments. The number of shares to be issued to a stockholder is determined by dividing the total dollar amount of the contribution by a stockholder by the net asset value per share of the common stock as of the last day of the Company’s fiscal quarter or such other date and price per share as determined by the Board in accordance with the requirements of the 1940 Act. As of September 30, 2018 and December 31, 2017, aggregate commitments relating to the Private Offering were $1.3 billion. The remaining unfunded capital commitments related to these Subscription Agreements totaled $376.6 million and $752.6 million as of September 30, 2018 and December 31, 2017, respectively. As of September 30, 2018 and December 31, 2017, BCSF Advisors, LP contributed in aggregate $7.8 million to the Company and received 389,428.14 shares of the Company and contributed $4.8 million to the Company and received 241,527.73 shares of the Company, respectively. At September 30, 2018 and December 31, 2017, BCSF Advisors, LP owned 0.89% and 0.97%, respectively, of the outstanding common stock of the Company.

The following table summarizes the total shares issued and amount received related to capital drawdowns delivered pursuant to the Subscription Agreements and shares issued pursuant to the dividend reinvestment plan during the three months ended September 30, 2018 and 2017:

	For the Three Months Ended September 30,
	2018			2017
	Shares	Amount		Shares	Amount
Total capital drawdowns	6,245,548.12	$	125,972,706	—	$	—
Dividend reinvestment	119,579.90	2,408,395		23,007.05	465,874
Total capital drawdowns and dividend reinvestment	6,365,128.02	$	128,381,101	23,007.05	$	465,874

Table of Contents

	For the Nine Months Ended September 30,
	2018			2017
	Shares	Amount		Shares	Amount
Total capital drawdowns	18,569,410.17	$	376,948,118	19,412,229.47	$	392,735,246
Dividend reinvestment	276,373.39	5,594,040		28,730.04	581,699
Total capital drawdowns and dividend reinvestment	18,845,783.56	$	382,542,158	19,440,959.51	$	393,316,945

Note 10. Commitments and Contingencies

Commitments

The Company’s investment portfolio may contain debt investments that are in the form of lines of credit and unfunded delayed draw commitments, which require the Company to provide funding when requested by portfolio companies in accordance with the terms of the underlying loan agreements.

As of September 30, 2018, the Company had $111.8 million of unfunded commitments under loan and financing agreements as follows:

	Expiration Date (1)	Unfunded Commitments (2) (3)
First Lien Senior Secured Loans
Abracon Group Holding, LLC — Revolver	7/18/2024	$	2,833,400
Aimbridge Hospitality LP — Revolver	6/22/2022	1,176,500
AMCP Clean Acquisition Company, LLC — Delayed Draw Term Loan	6/16/2025	2,549,677
Amspec Services, Inc. — Revolver	7/2/2024	5,666,800
Ansira Holdings, Inc. — Revolver	12/20/2022	5,440,128
AP Plastics Group, LLC — Revolver	8/1/2021	8,500,200
API Technologies Corp. — Revolver	4/22/2024	4,183,169
Aramsco, Inc. — Revolver	8/28/2024	2,314,312
Batteries Plus Holding Corporation — Revolver	7/6/2022	4,250,100
Captain D’s LLC — Revolver	12/15/2023	1,111,154
Chase Industries, Inc. — Delayed Draw Term Loan	5/12/2025	3,544,365
Clinical Innovations, LLC — Revolver	10/17/2022	575,862
CMI Marketing Inc — Revolver	5/24/2023	2,112,000
Cruz Bay Publishing — Revolver	6/6/2019	2,833,400
CST Buyer Company — Revolver	3/1/2023	897,478
Datix Bidco Limited — Revolver	10/28/2024	1,267,282
Direct Travel, Inc. — Revolver	12/1/2021	4,250,100
Dorner Manufacturing Corp. — Revolver	3/15/2022	1,098,883
Drilling Info Holdings, Inc. — Delayed Draw Term Loan	7/30/2025	3,041,710
Efficient Collaborative Retail Marketing Company, LLC — Revolver	6/15/2022	3,541,750
Element Buyer, Inc. — Revolver	7/19/2024	4,250,100
ENC Holding Corporation — Delayed Draw Term Loan	5/30/2025	480,821
Endries International, Inc. — Delayed Draw Term Loan	6/1/2023	55,900
Endries International, Inc. — Revolver	6/1/2022	2,504,942
FineLine Technologies, Inc. — Revolver	11/2/2021	1,965,543
Great Expressions Dental Centers PC — Revolver	9/28/2022	550,157
Home Franchise Concepts, Inc. — Revolver	7/9/2024	2,529,821
Horizon Telcom, Inc. — Revolver	6/15/2023	1,158,621
Horizon Telcom, Inc. — Delayed Draw Term Loan	6/15/2023	1,737,931
McKissock, LLC — Revolver	8/5/2021	1,841,710
PRCC Holdings, Inc. — Revolver	2/1/2021	3,541,750
Solaray, LLC — Revolver	9/9/2022	8,075,190
Sovos Compliance, LLC — Delayed Draw Term Loan	3/1/2022	870,968
Sovos Compliance, LLC — Revolver	3/1/2022	1,451,615
Stanton Carpet Corp. — Revolver	11/21/2022	4,250,100
TEI Holdings Inc. — Revolver	12/20/2022	3,116,740
Tidel Engineering, L.P. — Revolver	3/1/2023	4,250,100
Winchester Electronics Corporation — Revolver	6/30/2021	4,250,100
Zywave, Inc. — Revolver	11/17/2022	1,183,184
Total First Lien Senior Secured Loans		$	109,253,563
Other Unfunded Commitments
BCC Jetstream Holdings Aviation (On II), LLC		2,561,470
Total Other Unfunded Commitments		$	2,561,470
Total		$	111,815,033

Table of Contents

(1) Commitments are generally subject to borrowers meeting certain criteria such as compliance with covenants and certain operational metrics. These amounts may remain outstanding until the commitment period of an applicable loan expires, which may be shorter than its maturity.

(2) Unfunded commitments denominated in currencies other than U.S. dollars have been converted to U.S. dollars using the applicable foreign currency exchange rate as of September 30, 2018.

(3) Unfunded commitments represent unfunded commitments to fund investments, excluding our investment in ABCS as of September 30, 2018.

Table of Contents

As of December 31, 2017, the Company had $111.3 million of unfunded commitments under loan and financing agreements as follows:

	Expiration Date (1)	Unfunded Commitments (2) (3)
First Lien Senior Secured Loans
Ansira Holdings, Inc. — Revolver	12/20/2022	$	7,083,500
AP Plastics Group, LLC — Revolver	8/1/2021	7,565,178
Batteries Plus Holding Corporation — Revolver	7/6/2022	4,250,100
Captain D’s LLC — Revolver	12/15/2023	843,289
Clinical Innovations — Revolver	10/17/2022	998,161
Cruz Bay Publishing R/C — Revolver	6/6/2019	2,266,720
CST Buyer Company — Revolver	3/1/2023	897,478
Direct Travel, Inc.— Revolver	12/1/2021	4,250,100
Dorner Manufacturing Corp. — Revolver	3/15/2023	659,330
Efficient Collaborative Retail Marketing Company, LLC — Revolver	6/15/2022	3,541,750
ENC Holding Corporation — Revolver	2/8/2023	9,811,825
Endries International, Inc. — Delayed Draw Term Loan	6/1/2023	3,278,355
Endries International, Inc. — Revolver	6/1/2022	2,576,787
FineLine Technologies, Inc. — Revolver	11/2/2021	2,620,724
Great Expressions Dental Centers PC — Delayed Draw Term Loan	9/28/2023	667,000
Great Expressions Dental Centers PC — Revolver	9/28/2022	183,386
International Entertainment Investments Limited — Delayed Draw Term Loan	2/28/2022	558,414
K-Mac Holdings Corp. — Revolver	12/20/2021	1,440,000
Lakeland Tours, LLC — Delayed Draw Term Loan	12/8/2024	186,596
McKissock, LLC — Revolver	8/5/2019	2,125,050
PRCC Holdings, Inc. — Revolver	2/1/2021	3,541,750
Solaray, LLC — Revolver	9/9/2022	8,500,200
Sovos Compliance, LLC — Delayed Draw Term Loan	3/1/2022	4,838,710
Sovos Compliance, LLC — Revolver	3/1/2022	1,451,615
Stanton Carpet Corp. — Revolver	11/21/2022	4,250,100
TEI Holdings Inc. — Revolver	12/20/2022	4,250,100
Tidel Engineering, L.P. — Revolver	3/1/2023	5,666,800
Winchester Electronics Corporation — Revolver	6/30/2021	4,250,100
Zywave, Inc. — Revolver	11/17/2022	991,316
Total First Lien Senior Secured Loans		$	93,544,434
Second Lien Senior Secured Loans
NPC International, Inc. — Delayed Draw Term Loan	4/18/2025	8,000,716
Total Second Lien Senior Secured Loans		$	8,000,716
Other Unfunded Commitments
BCC Jetstream Holdings Aviation (On II), LLC		9,735,064
Total Other Unfunded Commitments		$	9,735,064
Total		$	111,280,214

(2) Unfunded commitments denominated in currencies other than U.S. dollars have been converted to U.S. dollars using the applicable foreign currency exchange rate as of December 31, 2017.

(3) Unfunded commitments represent unfunded commitments to fund investments, excluding our investment in ABCS as of December 31, 2017.

Table of Contents

Contingencies

In the normal course of business, the Company may enter into certain contracts that provide a variety of indemnities. The Company’s maximum exposure under these indemnities is unknown as it would involve future claims that may be made against the Company. Currently, the Company is not aware of any such claims and no such claims are expected to occur. As such, the Company does not consider it necessary to record a liability in this regard.

Note 11. Earnings Per Share

In accordance with the provisions of ASC Topic 260, Earnings per Share (“ASC 260”), basic earnings per share is computed by dividing earnings available to common shareholders by the weighted average number of shares outstanding during the period. Other potentially dilutive common shares, and the related impact to earnings, are considered when calculating earnings per share on a diluted basis. As of September 30, 2018 and December 31, 2017, there were no dilutive shares.

The following information sets forth the computation of the weighted average basic and diluted net increase in net assets per share from operations for the three and nine months ended September 30, 2018 and 2017:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
Basic and diluted	2018		2017		2018		2017
Net increase in net assets from operations	$	18,990,852	$	7,201,939	$	36,517,070	$	12,384,779
Weighted average common shares outstanding	41,733,013		24,921,589		35,461,497		17,725,983
Earnings per common share-basic and diluted	$	0.46	$	0.29	$	1.03	$	0.70

Note 12. Financial Highlights

The following is a schedule of financial highlights for the nine months ended September 30, 2018 and 2017:

	For the Nine Months Ended September 30,
	2018			2017
Per share data:
Net asset value at beginning of period	$	20.30		$	20.10
Net investment income (1)	1.02			0.53
Net realized loss (1) (7)	(0.23		)	(0.01		)
Net change in unrealized appreciation (1) (2) (8)	0.19			0.10
Net increase in net assets resulting from operations (1) (9) (10)	0.98			0.62
Stockholder distributions from net investment income (3)	(1.11		)	(0.39		)

Net asset value at end of period	$	20.17		$	20.33

Net assets at end of period	$	883,961,230		$	506,896,246
Shares outstanding at end of period	43,821,595.55			24,931,841.86
Total return based on net asset value (4)	4.92		%	3.10		%
Ratios:
Ratio of net investment income to average net assets (5) (12) (13)	6.95		%	3.43		%
Ratio of total net expenses to average net assets (5) (12) (13)	5.27		%	1.84		%
Supplemental data:
Ratio of interest and debt financing expenses to average net assets (5) (12)	3.01		%	0.22		%
Ratio of net expenses (without incentive fees) to average net assets (5) (12)	4.63		%	1.72		%
Ratio of incentive fees, net of incentive fee waivers to average net assets (5) (11) (13)	0.63		%	0.12		%
Average debt outstanding	$	454,823,626		$	8,187,767
Portfolio turnover (6)	18.48		%	8.65		%
Total committed capital, end of period	$	1,256,069,125		$	1,255,119,125
Ratio of total contributed capital to total committed capital, end of period	70.02		%	40.04		%

(1)		The per share data was derived by using the weighted average shares outstanding during the period.
(2)		Net change in unrealized appreciation on investments per share may not be consistent with the consolidated statements of operations due to the timing of shareholder transactions.
(3)		The per share data for distributions reflects the actual amount of distributions declared during the period.
(4)		Total return based on net asset value is calculated as the change in net asset value per share during the period, assuming dividends and distributions, if any, are reinvested in accordance with the Company’s dividend reinvestment plan. Total return has not been annualized.

Table of Contents

(5)		The computation of average net assets during the period is based on averaging net assets for the period reported.
(6)		Portfolio turnover rate is calculated using the lesser of year-to-date sales or year-to-date purchases over the average of the invested assets at fair value for the period reported.
(7)		Net realized loss includes net realized gain (loss) on investments, net realized gain (loss) on forward currency exchange contracts and net realized gain (loss) on foreign currency transactions.
(8)		Net change in unrealized appreciation includes net change in unrealized appreciation (depreciation) on investments, net change in unrealized appreciation (depreciation) on forward currency exchange contracts and net change in unrealized appreciation (depreciation) on foreign currency translation.
(9)		The sum of quarterly per share amounts may not equal earnings per share. This is due to changes in the number of weighted average shares outstanding and the effects of rounding.
(10)		Net increase in net assets resulting from operations per share in these financial highlights may be different from the net increase in net assets per share on the consolidated statements of operations due to rounding.
(11)		Ratio is not annualized.
(12)		Ratio is annualized. Incentive fees included within the ratio are not annualized.
(13)		Ratio of voluntary incentive fee waiver to average net assets was 0.23% for the nine months ended September 30, 2018 (Note 5). The ratio of net investment income without the voluntary incentive fee waiver to average net assets for the nine months ended September 30, 2018 would be 6.73%. The ratio of total expenses without the voluntary incentive fee waiver to average net assets for the nine months ended September 30, 2018 would be 5.49%. There was no impact for the nine months ended September 30, 2017.

Note 13. Subsequent Events

On October 5, 2018, the Company filed a registration statement (the “Registration Statement”) with the SEC related to an initial public offering of the Company’s common stock (the “Proposed Initial Public Offering”). The Company intends to use substantially all of the proceeds from the offering, net of expenses, to repay a portion of its outstanding indebtedness. The Company intends to use any remaining proceeds to make investments in accordance with its investment objectives and strategies and for general corporate purposes. The timing of the Proposed Initial Public Offering is uncertain and there is no guarantee it will occur. The SEC has not declared the Registration Statement effective and securities may not be sold, nor may offers to buy the securities be accepted, prior to the time this registration statement becomes effective.

On October 11, 2018, the Board approved, subject to completion of the Proposed Initial Public Offering, an Amended and Restated Investment Advisory Agreement. Beginning with the calendar quarter that commences January 1, 2019, this Amended and Restated Investment Advisory Agreement incorporates (i) a three-year lookback provision and (ii) a cap on quarterly income incentive fee payments based on net realized or unrealized capital loss, if any, during the applicable three-year lookback period.

Table of Contents

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

You should read the following analysis of our financial condition and results of operations in conjunction with our financial statements and related notes appearing in our Annual Report on Form 10-K (the “Annual Report”) for the year ended December 31, 2017, filed with the U.S. Securities and Exchange Commission (“SEC”) on March 16, 2018. The information contained in this section should also be read in conjunction with our unaudited financial statements and related notes and other financial information appearing elsewhere in this Quarterly Report on Form 10-Q (the “Quarterly Report”).

Overview

Bain Capital Specialty Finance, Inc. (the “Company”, “we”, “our” and “us”) is an externally managed specialty finance company focused on lending to middle market companies. We have elected to be regulated as a business development company (a “BDC”) under the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the “1940 Act”). We are managed by BCSF Advisors, LP (our “Advisor” or “BCSF Advisors”), a subsidiary of Bain Capital Credit, LP (“Bain Capital Credit”). Our Advisor is registered as an investment adviser with the SEC under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). Our Advisor also provides the administrative services necessary for us to operate (in such capacity, our “Administrator” or “BCSF Advisors”). Since we commenced operations on October 13, 2016 through September 30, 2018, we have invested approximately $1,727.9 million in aggregate principal amount of debt and equity investments prior to any subsequent exits or repayments. We seek to generate current income and, to a lesser extent, capital appreciation through direct originations of secured debt, including first lien, first lien/last-out, unitranche and second lien debt, investments in strategic joint ventures, equity investments and, to a lesser extent, corporate bonds.

Our primary focus is capitalizing on opportunities within our Senior Direct Lending strategy, which seeks to provide risk-adjusted returns and current income to our stockholders by investing primarily in middle-market companies with between $10.0 million and $150.0 million in annual earnings before interest, taxes, depreciation and amortization (“EBITDA”). However, we may, from time to time, invest in larger or smaller companies. We generally seek to retain effective voting control in respect of the loans or particular classes of securities in which we invest through maintaining affirmative voting positions or negotiating consent rights that allow us to retain a blocking position. We focus on senior investments with a first or second lien on collateral and strong structures and documentation intended to protect the lender. We may also invest in mezzanine debt and other junior securities, including common and preferred equity, on an opportunistic basis, and in secondary purchases of assets or portfolios but such investments are not the principal focus of our investment strategy. In addition, we may invest, from time to time, in distressed debt, debtor-in-possession loans, structured products, structurally subordinate loans, investments with deferred interest features, zero-coupon securities and defaulted securities.

We generate revenues primarily through receipt of interest income from the investments we hold. In addition, we generate income from various loan origination and other fees, dividends on direct equity investments and capital gains on the sales of investments. The companies in which we invest use our capital for a variety of reasons, including to support organic growth, to fund changes of control, to fund acquisitions, to make capital investments and for refinancing and recapitalizations.

Investments

We expect that our level of investment activity may 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 level of investment and capital expenditures of such companies, the general economic environment, the amount of capital we have available to us and the competitive environment for the type of investments we make.

As a BDC, we may not acquire any assets other than “qualifying assets” specified in the 1940 Act, unless, at the time the acquisition is made, at least 70% of our total assets are qualifying assets (with certain limited exceptions). Qualifying assets include investments in “eligible portfolio companies.” Pursuant to rules adopted by the SEC, “eligible portfolio companies” include certain companies that do not have any securities listed on a national securities exchange and public companies whose securities are listed on a national securities exchange but whose market capitalization is less than $250 million.

As a BDC, we may also invest up to 30% of our portfolio opportunistically in “non-qualifying” portfolio investments, such as investments in non-U.S. companies.

Market Overview

With respect to returns, while loan spreads have tightened in the past few quarters, yields have remained relatively stable due to upward movement in LIBOR rates. During recent quarters, the Advisor has also noted stable all-in-yields. In addition, as we move later in the credit cycle, the Advisor has observed that sponsors and companies are more frequently utilizing EBITDA add-backs to demonstrate run-rate profitability. In an environment where the Advisor believes corporate profits are nearing cyclical peaks, the

Table of Contents

Advisor is increasingly skeptical of these add-backs and always incorporates such add-backs into its loan underwriting process. Despite the aforementioned headwinds, the Advisor continues to believe the investment set broadly provides attractive risk/return investment opportunities for the Company although caution is warranted.

Revenues

We primarily generate revenue in the form of interest income on debt investments and, to a lesser extent, capital gains and distributions, if any, on equity securities that we may acquire in portfolio companies. Some of our investments may provide for deferred interest payments or payment-in-kind (“PIK”) interest. The principal amount of the debt investments and any accrued but unpaid interest generally becomes due at the maturity date. In addition, we may generate revenue in the form of commitment, origination, structuring or diligence fees, fees for providing managerial assistance and consulting fees. Loan origination fees, original issue discount and market discount or premium are capitalized, and we accrete or amortize such amounts into or against income over the life of the loan. We record contractual prepayment premiums on loans and debt securities as interest income.

Our debt investment portfolio consists of primarily floating rate loans. As of September 30, 2018 and December 31, 2017, 95.6% and 98.4%, respectively, of our debt investments, based on fair value, bore interest at floating rates, which may be subject to interest rate floors. Variable-rate investments subject to a floor generally reset periodically to the applicable floor, only if the floor exceeds the index. Trends in base interest rates, such as LIBOR, may affect our net investment income over the long term. In addition, our results may vary from period to period depending on the interest rates of new investments made during the period compared to investments that were sold or repaid during the period; these results 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 macroeconomic trends.

Expenses

Our primary operating expenses include the payment of fees to our Advisor under the investment advisory agreement (the “Investment Advisory Agreement”), our allocable portion of overhead expenses under the administration agreement (the “Administration Agreement”) and other operating costs, including those described below. The Base Management Fee and Incentive Fee compensate our Advisor for its work in identifying, evaluating, negotiating, closing and monitoring our investments. We bear all other out-of-pocket costs and expenses of our operations and transactions, including:

· our initial organization costs incurred prior to the commencement of our operations;

· operating costs incurred prior to the commencement of our operations;

· costs of calculating our net asset value (including the cost and expenses of any third-party valuation services);

· fees and expenses payable to third parties relating to evaluating, making and disposing of investments, including our Advisor’s or its affiliates’ travel expenses, research costs and out-of-pocket fees and expenses associated with performing due diligence and reviews of prospective investments, monitoring our investments and, if necessary, enforcing our rights;

· interest payable on debt, if any, incurred to finance our investments;

· costs of effecting sales and repurchases of our common stock and other securities;

· the base management fee and any incentive fee;

· distributions on our common stock;

· transfer agent and custody fees and expenses;

· the allocated costs incurred by the Administrator in providing managerial assistance to those portfolio companies that request it;

· other expenses incurred by BCSF Advisors or us in connection with administering our business, including payments made to third-party providers of goods or services;

· brokerage fees and commissions;

· federal and state registration fees;

· any stock exchange listing fees;

· U.S. federal, state and local taxes;

Table of Contents

· Independent Director fees and expenses;

· costs associated with our reporting and compliance obligations under the 1940 Act and applicable U.S. federal and state securities laws;

· costs of any reports, proxy statements or other notices to our stockholders, including printing costs;

· costs of holding stockholder meetings;

· our fidelity bond;

· directors’ and officers’ errors and omissions liability insurance, and any other insurance premiums;

· litigation, indemnification and other non-recurring or extraordinary expenses;

· direct costs and expenses of administration and operation, including printing, mailing, long distance telephone, staff, audit, compliance, tax and legal costs;

· fees and expenses associated with marketing efforts;

· dues, fees and charges of any trade association of which we are a member; and

· all other expenses reasonably incurred by us or the Administrator in connection with administering our business.

To the extent that expenses to be borne by us are paid by BCSF Advisors, we will generally reimburse BCSF Advisors for such expenses. To the extent the Administrator outsources any of its functions, the Company will pay the fees associated with such functions on a direct basis without profit to the Administrator. We also reimburse the Administrator for its costs and expenses and our allocable portion of overhead incurred by it in performing its obligations under the Administration Agreement, including rent and compensation paid to or compensatory distributions received by our officers (including our Chief Compliance Officer and Chief Financial Officer) and any of their respective staff who provide services to us, operations staff who provide services to us, internal audit staff, if any, to the extent internal audit performs a role in our Sarbanes-Oxley internal control assessment and fees paid to third-party providers for goods or services. Our allocable portion of overhead will be determined by the Administrator, which expects to use various methodologies such as allocation based on the percentage of time certain individuals devote, on an estimated basis, to our business and affairs, and will be subject to oversight by our board of directors (our “Board”). The sub-administrator is paid its compensation for performing its sub-administrative services under the sub-administration agreement. We incurred expenses related to the sub-administrator of $0.4 million and $0.2 million for the three months ended September 30, 2018 and 2017, respectively, and $0.8 million and $0.5 million for the nine months ended September 30, 2018 and 2017, respectively, which is included in other general and administrative expenses on the consolidated statement of operations. BCSF Advisors will not be reimbursed to the extent that such reimbursements would cause any distributions to our stockholders to constitute a return of capital. All of the foregoing expenses are ultimately borne by our stockholders.

We may also enter into additional credit facilities or other debt arrangements to partially fund our operations, and could incur costs and expenses including commitment, origination, or structuring fees and the related interest costs associated with any amounts borrowed.

Leverage

We may borrow money from time to time. However, our ability to incur indebtedness (including by issuing preferred stock) is limited by applicable regulations such that our asset coverage, as defined in the 1940 Act, must equal at least 200% (or 150% if certain disclosure and approval requirements are met). Our Advisor plans to seek Board and stockholder approval to reduce our asset coverage ratio to 150% as soon as practical following the completion of the Proposed Initial Public Offering. If such approvals are obtained, our Advisor intends to amend the base management fee to implement a tiered management fee so that the base management fee of 1.5% will continue to apply to assets held at an asset coverage ratio of 200%, but a base management fee of 1.0% would apply to any amount of assets attributable to leverage decreasing our asset coverage ratio below 200%. We do not intend to change our primary focus of capitalizing on opportunities within our Senior Direct Lending strategy, which seeks to provide risk-adjusted returns and current income to our stockholders by investing primarily in middle market companies. In determining whether to borrow money, we will analyze the maturity, covenant package and rate structure of the proposed borrowings as well as the risks of such borrowings compared to our investment outlook.

Portfolio and Investment Activity

During the three months ended September 30, 2018, we invested $343.4 million in 52 portfolio companies, including ABCS as a single portfolio company, and had $65.1 million in aggregate amount of principal repayments and sales, resulting in a net increase in investments of $278.3 million for the period.

During the three months ended September 30, 2017, we invested $69.4 million in 19 portfolio companies and had $7.4 million in aggregate amount of principal repayments and sales, resulting in a net increase in net investments of $62.0 million for the period.

During the nine months ended September 30, 2018, we invested $716.8 million in 78 portfolio companies, including ABCS as a single portfolio company, and had $192.6 million in aggregate amount of principal repayments and sales, resulting in a net increase in investments of $524.2 million for the period.

Table of Contents

During the nine months ended September 30, 2017, we invested $394.9 million in 50 portfolio companies and had $26.0 million in aggregate amount of principal repayments and sales, resulting in a net increase in investments of $368.9 million for the period.

The following table shows the composition of the investment portfolio and associated yield data as of September 30, 2018:

	As of September 30, 2018
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio		Weighted Average Yield
First Lien Senior Secured Loans (1)	$	764,087,554	57.0	%	$	768,797,174	56.9	%	6.8	%
First Lien Last Out Loans (1)	29,740,058		2.2		30,397,170		2.2		8.3
Second Lien Senior Secured Loans (1)	214,158,341		16.0		215,053,521		15.9		9.5
Subordinated Debt(1)	24,702,741		1.8		24,700,000		1.8		13.2
Corporate Bonds (1)	33,898,598		2.5		33,175,470		2.5		8.2
Investment Vehicles (1) (2)	256,316,439		19.1		258,632,338		19.1		13.4
Equity Interest	16,905,906		1.3		18,616,855		1.4		N/A
Preferred Equity	1,952,879		0.1		2,070,053		0.2		N/A
Total (1)	$	1,341,762,516	100.0	%	$	1,351,442,581	100.0	%	8.7	%

(1) Computed for debt investments based upon the annual interest rate at September 30, 2018, divided by the total par amount of investments. For investments with floating interest rates, the yield calculation is computed using the contract rate at September 30, 2018. Weighted average yield for Investment Vehicles represents the weighted average levered yield of our proportionate investment in ABCS at September 30, 2018. Weighted average yield for Investment Vehicles is computed based upon (1) the weighted average of the interest rate of investments held by ABCS less (2) the weighted average interest rate of the ABCS Facility, as defined below, divided by our par amount in ABCS. Total weighted average yield is the weighted average of the yields of the debt investments and the Investment Vehicles in ABCS. The weighted average yield does not represent the total return to our stockholders.

(2) Represents equity investment in ABCS.

The following table shows the composition of the investment portfolio and associated yield data as of December 31, 2017:

	As of December 31, 2017
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio		Weighted Average Yield
First Lien Senior Secured Loans (1)	$	478,807,128	58.3	%	$	485,319,396	58.4	%	6.2	%
First Lien Last Out Loans (1)	29,329,934		3.6		30,515,994		3.7		7.8
Second Lien Senior Secured Loans (1)	115,414,976		14.1		117,467,412		14.1		9.4
Corporate Bonds (1)	8,478,000		1.0		8,138,880		1.0		7.8
Investment Vehicles (1) (2)	178,052,288		21.7		178,409,807		21.4		13.0
Equity Interest	9,227,719		1.1		9,763,092		1.2		N/A
Preferred Equity	1,952,879		0.2		1,963,490		0.2		N/A
Total (1)	$	821,262,924	100.0	%	$	831,578,071	100.0	%	8.2	%

(1) Computed for debt investments based upon the annual interest rate at December 31, 2017, divided by the total par amount of investments. For investments with floating interest rates, the yield calculation is computed using the contract rate at December 31, 2017. Weighted average yield for Investment Vehicles represents the weighted average levered yield of our proportionate investment in ABCS at December 31, 2017. Weighted average yield for Investment Vehicles is computed based upon (1) the weighted average of the interest rate of investments held by ABCS less (2) the weighted average interest rate of the ABCS Facility, divided by our par amount in ABCS. Total weighted average yield is the weighted average of the yields of the debt investments and the Investment Vehicles in ABCS. The weighted average yield does not represent the total return to our stockholders.

(2) Represents equity investment in ABCS.

The following table presents certain selected information regarding our investment portfolio as of September 30, 2018:

	As of
	September 30, 2018
Number of portfolio companies (2)	113
Percentage of debt bearing a floating rate (1)	95.6	%
Percentage of debt bearing a fixed rate (1)	4.4	%

Table of Contents

(1) Measured on a fair value basis.

(2) Includes ABCS as a single portfolio company. For details of portfolio companies held within ABCS, refer to the selected financial data of ABCS.

The following table presents certain selected information regarding our investment portfolio as of December 31, 2017:

	As of
	December 31, 2017
Number of portfolio companies (2)	85
Percentage of debt bearing a floating rate (1)	98.4	%
Percentage of debt bearing a fixed rate (1)	1.6	%

(1) Measured on a fair value basis.

(2) Includes ABCS as a single portfolio company. For details of portfolio companies held within ABCS, refer to the selected financial data of ABCS.

The following table shows the amortized cost and fair value of our performing and non-accrual investments as of September 30, 2018:

	As of September 30, 2018
	Amortized Cost		Percentage at Amortized Cost		Fair Value		Percentage at Fair Value
Performing	$	1,341,762,516	100.0	%	$	1,351,442,581	100.0	%
Non-accrual	—		—		—		—
Total	$	1,341,762,516	100.0	%	$	1,351,442,581	100.0	%

The following table shows the amortized cost and fair value of our performing and non-accrual investments as of December 31, 2017:

	As of December 31, 2017
	Amortized Cost		Percentage at Amortized Cost		Fair Value		Percentage at Fair Value
Performing	$	821,262,924	100.0	%	$	831,578,071	100.0	%
Non-accrual	—		—		—		—
Total	$	821,262,924	100.0	%	$	831,578,071	100.0	%

Loans or debt securities are placed on non-accrual status when there is reasonable doubt that principal or interest will be collected. Accrued interest generally is reversed when a loan or debt security is placed on non-accrual status. Interest payments received on non-accrual loans or debt securities may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual loans and debt securities are restored to accrual status when past due principal and interest is paid and, in management’s judgment, are likely to remain current. We may make exceptions to this treatment if the loan has sufficient collateral value and is in the process of collection.

The following table shows the amortized cost and fair value of the investment portfolio, cash and cash equivalents, foreign cash and restricted cash as of September 30, 2018:

	As of September 30, 2018
	Amortized Cost		Percentage of Total		Fair Value		Percentage of Total
Cash and cash equivalents	$	151,069,731	9.9	%	$	151,069,731	9.8	%
Foreign cash	1,684,252		0.1		1,666,238		0.1
Restricted cash	37,735,920		2.5		37,735,920		2.4
First Lien Senior Secured Loans	764,087,554		49.9		768,797,174		49.9
First Lien Last Out Loans	29,740,058		1.9		30,397,170		2.0
Second Lien Senior Secured Loans	214,158,341		14.0		215,053,521		13.9
Subordinated Debt	24,702,741		1.6		24,700,000		1.6
Corporate Bonds	33,898,598		2.2		33,175,470		2.2
Investment Vehicles (1)	256,316,439		16.7		258,632,338		16.8
Equity Interest	16,905,906		1.1		18,616,855		1.2
Preferred Equity	1,952,879		0.1		2,070,053		0.1
Total	$	1,532,252,419	100.0	%	$	1,541,914,470	100.0	%

Table of Contents

(1) Represents equity investment in ABCS.

The following table shows the amortized cost and fair value of the investment portfolio, cash and cash equivalents and foreign cash as of December 31, 2017:

	As of December 31, 2017
	Amortized Cost		Percentage of Total		Fair Value		Percentage of Total
Cash and cash equivalents	$	139,506,289	14.5	%	$	139,506,289	14.4	%
Foreign cash	1,383,845		0.1		1,411,855		0.1
First Lien Senior Secured Loans	478,807,128		49.8		485,319,396		49.9
First Lien Last Out Loans	29,329,934		3.0		30,515,994		3.1
Second Lien Senior Secured Loans	115,414,976		12.0		117,467,412		12.1
Corporate Bonds	8,478,000		0.9		8,138,880		0.8
Investment Vehicles (1)	178,052,288		18.5		178,409,807		18.4
Equity Interest	9,227,719		1.0		9,763,092		1.0
Preferred Equity	1,952,879		0.2		1,963,490		0.2
Total	$	962,153,058	100.0	%	$	972,496,215	100.0	%

(1) Represents equity investment in ABCS.

	As of September 30, 2018
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
Investment Vehicles (1)	$	256,316,439	19.1	%	$	258,632,338	19.1	%
High Tech Industries	189,566,425		14.1		191,434,754		14.2
Healthcare & Pharmaceuticals	106,449,969		7.9		106,217,351		7.9
Services: Business	94,199,547		7.0		94,193,051		7.0
Aerospace & Defense	81,489,111		6.1		82,291,399		6.1
Hotel, Gaming & Leisure	72,571,003		5.4		73,530,045		5.4
Consumer Goods: Non-Durable	53,835,324		4.0		54,124,605		4.0
Transportation: Cargo	51,020,267		3.8		51,298,122		3.8
Capital Equipment	48,362,821		3.6		48,747,952		3.6
Retail	40,351,182		3.0		40,425,958		3.0
Containers, Packaging & Glass	35,366,817		2.6		35,335,491		2.6
Energy: Oil & Gas	30,580,293		2.3		30,731,999		2.2
Construction & Building	28,079,234		2.1		29,118,560		2.2
Wholesale	28,527,781		2.1		28,746,541		2.1
Insurance	24,902,551		1.9		24,867,121		1.8
Automotive	23,696,376		1.8		23,924,720		1.8
Energy: Electricity	22,419,958		1.7		22,417,787		1.7
Services: Consumer	21,029,247		1.6		21,206,727		1.6
Environmental Industries	19,098,906		1.4		19,533,532		1.4
Consumer Goods: Durable	17,174,674		1.3		17,334,702		1.3
Media: Broadcasting & Subscription	16,953,518		1.3		17,129,550		1.3
Beverage, Food & Tobacco	16,642,868		1.3		16,683,669		1.2
Telecommunications	15,266,863		1.1		15,202,035		1.1
Media: Diversified & Production	10,620,959		0.8		11,318,099		0.8
Real Estate	10,693,059		0.8		10,791,720		0.8
Utilities: Electric	9,885,536		0.7		9,063,470		0.7
Chemicals, Plastics & Rubber	7,370,290		0.5		7,742,816		0.6
Media: Advertising, Printing & Publishing	5,658,849		0.4		5,733,872		0.4
FIRE: Finance	3,632,649		0.3		3,664,595		0.3
Banking	—		0.0		—		0.0
Transportation: Consumer	—		0.0		—		0.0
Total	$	1,341,762,516	100.0	%	$	1,351,442,581	100.0	%

Table of Contents

(1) Represents equity investment in ABCS.

	As of December 31, 2017
	Amortized Cost		Percentage of Total Portfolio		Fair Value		Percentage of Total Portfolio
Investment Vehicles (1)	$	178,052,288	21.7	%	$	178,409,807	21.4	%
High Tech Industries	105,919,464		12.9		106,185,758		12.8
Healthcare & Pharmaceuticals	68,318,089		8.3		68,687,910		8.3
Services: Business	60,000,491		7.3		60,598,544		7.3
Aerospace & Defense	44,021,059		5.4		44,898,545		5.4
Beverage, Food & Tobacco	35,301,640		4.3		35,673,127		4.3
Capital Equipment	31,499,131		3.8		32,104,902		3.9
Wholesale	27,025,660		3.3		27,187,662		3.3
Energy: Oil & Gas	26,472,225		3.2		26,957,462		3.2
Containers, Packaging & Glass	25,227,891		3.1		25,329,872		3.0
Automotive	24,194,235		3.0		24,512,807		2.9
Media: Diversified & Production	20,524,304		2.5		21,886,325		2.6
Consumer Goods: Non-Durable	20,925,794		2.6		21,241,067		2.6
Environmental Industries	19,064,227		2.3		20,256,052		2.4
Construction & Building	15,970,504		1.9		17,521,014		2.1
Consumer Goods: Durable	15,105,349		1.8		15,118,365		1.8
Media: Broadcasting & Subscription	14,927,621		1.8		15,019,941		1.8
Retail	14,389,584		1.8		14,416,081		1.7
Telecommunications	13,476,372		1.6		13,778,898		1.7
Insurance	12,192,503		1.5		12,238,811		1.5
Real Estate	10,644,272		1.3		10,863,204		1.3
Transportation: Cargo	10,508,551		1.3		10,734,350		1.3
Chemicals, Plastics & Rubber	8,441,194		1.0		8,996,750		1.1
Utilities: Electric	8,478,000		1.0		8,138,880		1.0
Media: Advertising, Printing & Publishing	5,918,148		0.7		6,020,680		0.7
Hotel, Gaming & Leisure	4,664,328		0.6		4,801,257		0.6
Banking	—		0.0		—		0.0
Transportation: Consumer	—		0.0		—		0.0
Total	$	821,262,924	100.0	%	$	831,578,071	100.0	%

(1) Represents equity investment in ABCS.

Our Advisor 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 for each company. The Advisor has several methods of evaluating and monitoring the performance and fair value of our investments, which may include the following:

· assessment of success in adhering to the portfolio company’s business plan and compliance with covenants;

· periodic or regular contact with portfolio company management and, if appropriate, the financial or strategic sponsor to discuss financial position, requirements and accomplishments;

· comparisons to our other portfolio companies in the industry, if any;

· attendance at and participation in board meetings or presentations by portfolio companies; and

· review of monthly and quarterly financial statements and financial projections of portfolio companies.

Table of Contents

Our Advisor 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 or 4, Advisor enhances its level of scrutiny over the monitoring of such portfolio company. Our internal performance ratings do not constitute any rating of investments by a nationally recognized statistical rating organization or represent or reflect any third-party assessment of any of our investments.

· An investment is rated 1 if, in the opinion of our Advisor, it is performing above underwriting expectations, and the business trends and risk factors are generally favorable, which may include the performance of the portfolio company or the likelihood of a potential exit.

· An investment is rated 2 if, in the opinion of our Advisor, it is performing as expected at the time of our underwriting and there are generally no concerns about the portfolio company’s performance or ability to meet covenant requirements, interest payments or principal amortization, if applicable. All new investments or acquired investments in new portfolio companies are initially given a rating of 2.

· An investment is rated 3 if, in the opinion of our Advisor, the investment is performing below underwriting expectations and there may be concerns about the portfolio company’s performance or trends in the industry, including as a result of factors such as declining performance, non-compliance with debt covenants or delinquency in loan payments (but generally not more than 180 days past due).

· An investment is rated 4 if, in the opinion of our Advisor, the investment is performing materially below underwriting expectations. For debt investments, most of or all of the debt covenants are out of compliance and payments are substantially delinquent. Investments rated 4 are not anticipated to be repaid in full, if applicable, and there is significant risk that we may realize a substantial loss on our investment.

The following table shows the composition of our portfolio on the 1 to 4 rating scale as of September 30, 2018:

	As of September 30, 2018
Investment Performance Rating	Fair Value		Percentage of Total		Number of Companies	Percentage of Total
1	$	11,856,145	0.9	%	2	1.8	%
2	1,330,522,966		98.4		110	97.3
3	9,063,470		0.7		1	0.9
4	—		—		—	—
Total	$	1,351,442,581	100.0	%	113	100.0	%

The following table shows the composition of our portfolio on the 1 to 4 rating scale as of December 31, 2017:

	As of December 31, 2017
Investment Performance Rating	Fair Value		Percentage of Total		Number of Companies	Percentage of Total
1	$	—	—	%	—	—	%
2	831,578,071		100.0		85	100.0
3	—		—		—	—
4	—		—		—	—
Total	$	831,578,071	100.0	%	85	100.0	%

Antares Bain Capital Complete Financing Solution

We have entered into a limited liability company agreement with Antares Midco Inc. (“Antares”) to invest in ABC Complete Financing Solution LLC, which makes investments through its subsidiary, Antares Bain Capital Complete Financing Solution LLC (together with ABC Complete Financing Solution LLC, “ABCS”). ABCS, an unconsolidated Delaware limited liability company, was formed on September 27, 2017 and commenced operations on November 29, 2017. ABCS’ principal purpose is to make investments, primarily in senior secured unitranche loans. We record our investment in ABCS at fair value. Distributions of income received from ABCS, if any, are recorded as dividend income from controlled investments in the consolidated statements of operations. Distributions received from ABCS in excess of income earned at ABCS, if any, are recorded as a return of capital and reduce the amortized cost of controlled affiliate investments.

Table of Contents

We and Antares, as members of ABCS, have agreed to contribute capital up to (subject to the terms of our agreement) $950.0 million in aggregate to purchase equity interests in ABCS, with each member contributing up to $425.0 million and $525.0 million, respectively. Funding of such commitments generally requires the consent of both Antares Credit Opportunities Manager LLC and our Advisor on behalf of Antares and the Company, respectively. ABCS is capitalized with capital contributions from its members on a pro-rata basis based on their maximum capital contributions as transactions are funded after they have been approved.

Investment decisions of ABCS require the consent of both our Advisor and Antares Credit Opportunities Manager LLC, as representatives of us and Antares, respectively. Each of our Advisor and Antares source investments for ABCS. ABCS’s affairs are conducted by Antares Credit Opportunities Manager LLC, as manager of ABCS.

The following table shows the ABCS maximum capital contributions, contributions and unfunded capital contributions from its members as of September 30, 2018.

	As of September 30, 2018
	Maximum Capital Contributions		Contributed Capital		Unfunded Capital Contributions
Bain Capital Specialty Finance, Inc.	$	425,000,000	$	257,626,698	$	167,373,302
Antares Midco Inc.	525,000,000		318,239,042		206,760,958
Total Investments	$	950,000,000	$	575,865,740	$	374,134,260

The following table shows the ABCS maximum capital contributions, contributions and unfunded capital contributions from its members as of December 31, 2017.

	As of December 31, 2017
	Maximum Capital Contributions		Contributed Capital		Unfunded Capital Contributions
Bain Capital Specialty Finance, Inc.	$	425,000,000	$	178,052,288	$	246,947,712
Antares Midco Inc.	525,000,000		219,941,870		305,058,130
Total Investments	$	950,000,000	$	397,994,158	$	552,005,842

	As of
	September 30, 2018			December 31, 2017
Total first lien senior secured loans (1)	$	1,496,894,149		$	956,536,905
Weighted average yield on first lien unitranche loans (2)	8.3		%	8.1		%
Largest loan to a single borrower (1)	$	119,186,478		$	106,231,058
Total of five largest loans to borrowers (1)	$	559,029,976		$	465,635,606
Number of borrowers in the ABCS	19			14
Commitments to fund delayed draw loans (3)	$	43,700,328		$	25,087,777

(1) At principal amount.

(2) Based on par amount.

(3) As discussed above, these commitments have been approved by ABCS.

Below is certain summarized financial information for ABCS as of September 30, 2018 and December 31, 2017 and for the three and nine months ended September 30, 2018:

Table of Contents

Selected Balance Sheet Information

	As of
	September 30, 2018		December 31, 2017
Loans, net of allowance of $12,745,780 and $0, respectively (1)	$	1,474,881,810	$	956,184,609
Cash, restricted cash and other assets	40,707,358		33,348,801
Total assets	$	1,515,589,168	$	989,533,410
Debt (2)	$	926,058,511	$	587,657,029
Other liabilities	13,401,675		3,340,372
Total liabilities	$	939,460,186	$	590,997,401
Members’ equity	576,128,982		398,536,009
Total liabilities and members’ equity	$	1,515,589,168	$	989,533,410

(2) Net of $3.8 and $4.5 million deferred financing costs for the ABCS Facility, as of September 30, 2018 and December 31, 2017, respectively.

Selected Statement of Operations Information

	For the Three Months Ended		For the Nine Months Ended
	September 30, 2018		September 30, 2018
Interest income	$	29,224,155	$	72,352,543
Fee income	88,939		1,035,581
Total revenues	29,313,094		73,388,124
Credit facility expenses (1)	12,563,745		32,283,527
Other fees and expenses	13,848,375		16,326,361
Total expenses	26,412,120		48,609,888
Net investment income	2,900,974		24,778,236
Net realized gains	—		—
Net change in unrealized appreciation (depreciation) on investments	—		—
Net increase in members’ capital from operations	$	2,900,974	$	24,778,236

(1) As of September 30, 2018 and December 31 2017, the ABCS Facility had $929.8 million and $592.1 million of outstanding debt, respectively.

Loan Origination and Structuring Fees

Table of Contents

Antares Bain Capital Complete Financing Solution

Schedule of Investments

As of September 30, 2018

(Unaudited)

Portfolio Company	Spread Above Index (1)	Interest Rate		Maturity Date	Principal/ Par Amount		Carrying Value		Fair Value (2)
Investments
Corporate Debt
Delayed Draw Term Loan
Capital Equipment
Winchester Electronics Corporation	L+ 6.50%	8.74	%	6/30/2022	$	11,209,129	11,209,128		11,209,129
Total Capital Equipment							11,209,128		11,209,129
Chemicals, Plastics & Rubber
PRCC Holdings, Inc. (6)	L+ 6.50%	8.75	%	2/1/2021	$	12,003,338	12,003,338		12,003,338
Total Chemicals, Plastics & Rubber							12,003,338		12,003,338
Consumer Goods: Non-Durable
Solaray, LLC (9)	L+ 6.50%	8.84	%	9/9/2023	$	25,689,049	25,530,436		25,689,049
Total Consumer Goods: Non-Durable							25,530,436		25,689,049
Media: Advertising, Printing & Publishing
Ansira Holdings, Inc.	L+ 5.75%	7.99	%	12/20/2022	$	2,480,981	2,480,981		2,480,981
Total Media: Advertising, Printing & Publishing							2,480,981		2,480,981
Services: Business
Element Buyer, Inc.(14)	—	—		7/19/2025	$	—	—		(63,334		)
McKissock, LLC	L+ 5.75%	8.14	%	8/5/2021	$	2,611,626	2,611,626		2,611,626
Total Services: Business							2,611,626		2,548,292
Transportation: Consumer
Direct Travel, Inc. (13)	L+ 6.50%	8.87	%	12/1/2021	$	1,678,445	1,678,445		1,678,445
Total Transportation: Consumer							1,678,445		1,678,445
Total Delayed Draw Term Loan							55,513,954		55,609,234

First lien senior secured loan
Aerospace & Defense
API Technologies Corp. (12)	L+ 6.00%	8.25	%	4/20/2024	$	118,454,372	117,084,473		117,862,100
Total Aerospace & Defense							117,084,473		117,862,100
Banking
Tidel Engineering, L.P.	L+ 6.25%	8.64	%	3/1/2024	$	80,924,185	80,924,185		81,733,427
Total Banking							80,924,185		81,733,427
Capital Equipment
Abracon Group Holding, LLC	L+ 5.75%	8.08	%	7/18/2024	$	81,700,860	80,517,278		80,883,851
Aramsco, Inc.	L+ 5.25%	7.49	%	8/28/2024	$	50,469,044	49,475,319		49,712,008
Winchester Electronics Corporation	L+ 6.50%	8.73	%	6/30/2022	$	84,286,513	84,182,091		84,286,513
Total Capital Equipment							214,174,688		214,882,372
Chemicals, Plastics & Rubber
AP Plastics Group, LLC	L+ 5.25%	7.35	%	8/1/2022	$	50,585,308	50,529,842		50,585,308
PRCC Holdings, Inc. (5)	L+ 6.50%	8.75	%	2/1/2021	$	74,600,327	74,600,327		74,600,327
Total Chemicals, Plastics & Rubber							125,130,169		125,185,635
Construction & Building
Stanton Carpet Corp. (11)	L+ 5.50%	7.79	%	11/21/2022	$	61,334,534	61,278,330		61,334,534
Total Construction & Building							61,278,330		61,334,534
Consumer Goods: Durable
Home Franchise Concepts, Inc.	L+ 5.00%	7.13	%	7/9/2024	$	72,381,714	72,033,992		71,657,897
Total Consumer Goods: Durable							72,033,992		71,657,897
Consumer Goods: Non-Durable
Solaray, LLC (8)	L+ 6.50%	8.83	%	9/9/2023	$	85,806,327	85,806,327		85,806,327
Total Consumer Goods: Non-Durable							85,806,327		85,806,327
Energy: Oil & Gas
Amspec Services, Inc.	L+ 5.75%	8.09	%	7/2/2024	$	90,250,950	89,161,196		88,445,931
Total Energy: Oil & Gas							89,161,196		88,445,931
Media: Advertising, Printing & Publishing
Ansira Holdings, Inc.	L+ 5.75%	7.99	%	12/20/2022	$	82,215,157	82,060,449		82,215,157
Cruz Bay Publishing, Inc. (3)	L+ 5.75%	8.11	%	6/6/2019	$	11,646,589	11,646,589		11,646,589
Cruz Bay Publishing, Inc. (4)	L+ 6.75%	9.16	%	6/6/2019	$	3,889,335	3,889,335		3,889,335
Total Media: Advertising, Printing & Publishing							97,596,373		97,751,081
Media: Diversified & Production
Efficient Collaborative Retail Marketing Company, LLC	L+ 6.75%	9.14	%	6/15/2022	$	23,030,252	23,030,252		22,857,525
Efficient Collaborative Retail Marketing Company, LLC	L+ 6.75%	9.14	%	6/15/2022	$	33,741,229	33,029,405		33,488,170
Total Media: Diversified & Production							56,059,657		56,345,695
Retail
Batteries Plus Holding Corporation	L+ 6.75%	8.83	%	7/6/2022	$	68,156,203	68,156,203		68,156,203
Total Retail							68,156,203		68,156,203
Services: Business
Element Buyer, Inc.	L+ 5.25%	7.50	%	7/19/2025	$	85,500,900	83,886,496		85,287,148
McKissock, LLC	L+ 5.75%	8.14	%	8/5/2021	$	8,091,711	8,091,711		8,091,711
McKissock, LLC	L+ 5.75%	8.14	%	8/5/2021	$	42,249,930	41,882,258		42,566,804
TEI Holdings Inc. (10)	L+ 6.00%	8.39	%	12/20/2023	$	119,186,478	118,486,535		118,888,511
Total Services: Business							252,347,000		254,834,174
Transportation: Consumer
Direct Travel, Inc. (7)	L+ 6.50%	8.84	%	12/1/2021	$	112,719,663	112,361,043		112,719,663
Total Transportation: Consumer							112,361,043		112,719,663
Total First lien senior secured loan							1,432,113,636		1,436,715,039

Total Corporate Debt							$	1,487,627,590	$	1,492,324,273
Total Investments							$	1,487,627,590	$	1,492,324,273