Goldman Sachs BDC, Inc. - Quarter Report: 2019 March (Form 10-Q)

Goldman Sachs BDC, Inc.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended March 31, 2019

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

Commission file number 814-00998

Goldman Sachs BDC, Inc.

(Exact Name of Registrant as Specified in Its Charter)


Delaware		46-2176593
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

200 West Street, New York, New York		10282
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: (212) 902-0300

Not Applicable

Former Name, Former Address and Former Fiscal Year, If Changed Since Last Report.

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 ☐

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

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

Large accelerated filer:

Accelerated filer:

☐

Non-accelerated filer:

☐

Smaller reporting company:

☐

Emerging growth company:

☐

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

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). YES ☐ NO X

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

Title of each class

Trading

Symbol(s)

Name of each exchange

on which registered

Common Stock, par value

$0.001 per share

GSBD

The New York Stock Exchange

The number of shares of the registrant’s common stock, $0.001 par value per share, outstanding as of May 9, 2019 was 40,302,522.

GOLDMAN SACHS BDC, INC.


	INDEX	PAGE
PART I	FINANCIAL INFORMATION		4
ITEM 1.	Financial Statements		4
	Consolidated Statements of Assets and Liabilities as of March 31, 2019 (Unaudited) and December 31, 2018		4
	Consolidated Statements of Operations for the three months ended March 31, 2019 (Unaudited) and 2018 (Unaudited)		5
	Consolidated Statements of Changes in Net Assets for the three months ended March 31, 2019 (Unaudited) and 2018 (Unaudited)		6
	Consolidated Statements of Cash Flows for the three months ended March 31, 2019 (Unaudited) and 2018 (Unaudited)		7
	Consolidated Schedules of Investments as of March 31, 2019 (Unaudited) and December 31, 2018		8
	Notes to the Consolidated Financial Statements (Unaudited)		18
ITEM 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		47
ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk		71
ITEM 4.	Controls and Procedures		72

PART II	OTHER INFORMATION		73
ITEM 1.	Legal Proceedings		73
ITEM 1A.	Risk Factors		73
ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds		73
ITEM 3.	Defaults Upon Senior Securities		73
ITEM 4.	Mine Safety Disclosures		73
ITEM 5.	Other Information		73
ITEM 6.	Exhibits		73

SIGNATURES			75

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “anticipate,” “project,” “target,” “estimate,” “intend,” “continue” or “believe” or the negatives of, or other variations on, these terms or comparable terminology. You should read statements that contain these words carefully because they discuss our plans, strategies, prospects and expectations concerning our business, operating results, financial condition and other similar matters. We believe that it is important to communicate our future expectations to our investors. Our forward-looking statements include information in this report regarding general domestic and global economic conditions, our future financing plans, our ability to operate as a business development company (“BDC”) and the expected performance of, and the yield on, our portfolio companies. There may be events in the future, however, that we are not able to predict accurately or control. The factors listed under “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2018, as well as any cautionary language in this report, provide examples of risks, uncertainties and events that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements. The occurrence of the events described in these risk factors and elsewhere in this report could have a material adverse effect on our business, results of operations and financial position. Any forward-looking statement made by us in this report speaks only as of the date of this report. Factors or events that could cause our actual results to differ from our forward-looking statements may emerge from time to time, and it is not possible for us to predict all of them. You are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the U.S. Securities and Exchange Commission (the “SEC”), including annual reports on Form 10-K, registration statements on Form N-2, quarterly reports on Form 10-Q and current reports on Form 8-K. Under Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to statements made in periodic reports we file under the Exchange Act, such as this quarterly report on Form 10-Q.

The following factors are among those that may cause actual results to differ materially from our forward-looking statements:

•

our future operating results;

•

changes in political, economic or industry conditions, the interest rate environment or conditions affecting the financial and capital markets;

•

uncertainty surrounding the financial and political stability of the United States, the United Kingdom, the European Union and China;

•

our business prospects and the prospects of our portfolio companies;

•

the impact of investments that we expect to make;

•

the impact of increased competition;

•

our contractual arrangements and relationships with third parties;

•

the dependence of our future success on the general economy and its impact on the industries in which we invest;

•

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

•

the relative and absolute performance of our investment adviser;

•

our expected financings and investments;

•

the use of borrowed money to finance a portion of our investments;

•

our ability to make distributions;

•

the adequacy of our cash resources and working capital;

•

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

•

the impact of future acquisitions and divestitures;

•

the effect of changes in tax laws and regulations and interpretations thereof;

•

our ability to maintain our status as a BDC and a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”);

•

actual and potential conflicts of interest with Goldman Sachs Asset Management, L.P. and its affiliates;

•

general price and volume fluctuations in the stock market;

•

the ability of our investment adviser to attract and retain highly talented professionals;

•

the impact on our business from new or amended legislation or regulations;

•

the availability of credit and/or our ability to access the equity and capital markets; and

•

currency fluctuations, particularly to the extent that we receive payments denominated in foreign currency rather than U.S. dollars.

PART I. FINANCIAL INFORMATION

ITEM 1.

FINANCIAL STATEMENTS

Goldman Sachs BDC, Inc.

Consolidated Statements of Assets and Liabilities

(in thousands, except share and per share amounts)


	March 31, 2019 (Unaudited)			December 31, 2018
Assets

Investments, at fair value
Non-controlled/non-affiliated investments (cost of $1,131,280 and $1,155,641, respectively)	$	1,111,881		$	1,129,036
Non-controlled affiliated investments (cost of $139,396 and $143,700, respectively)		119,029			126,089
Controlled affiliated investments (cost of $180,979 and $126,217, respectively)		174,187			120,319
Cash		5,891			6,113
Receivable for investments sold		12			47
Unrealized appreciation on foreign currency forward contracts		167			89
Interest and dividends receivable from non-controlled/affiliated investments and non-controlled/non-affiliated investments		8,828			6,969
Dividend receivable from controlled affiliated investments		2,450			2,550
Deferred financing costs		5,512			5,436
Deferred offering costs		165			165
Other assets		138			163

Total assets	$	1,428,260		$	1,396,976


Liabilities

Debt (net of debt issuance costs of $4,915 and $5,318, respectively)	$	704,395		$	659,101
Interest and other debt expenses payable		3,923			2,428
Management fees payable		3,536			3,434
Incentive fees payable		493			–
Distribution payable		18,120			18,102
Directors’ fees payable		113			–
Accrued offering costs		2			2
Accrued expenses and other liabilities		2,932			4,017

Total liabilities	$	733,514		$	687,084

Commitments and Contingencies (Note 8)

Net Assets

Preferred stock, par value $0.001 per share (1,000,000 shares authorized, no shares issued and outstanding)	$	–		$	–
Common stock, par value $0.001 per share (200,000,000 shares authorized, 40,267,216 and 40,227,625 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively)		40			40
Paid-in capital in excess of par		802,975			802,216
Distributable earnings		(106,848	)		(90,943	)
Allocated income tax expense		(1,421	)		(1,421	)

TOTAL NET ASSETS	$	694,746		$	709,892

TOTAL LIABILITIES AND NET ASSETS	$	1,428,260		$	1,396,976


Net asset value per share	$	17.25		$	17.65

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Statements of Operations

(in thousands, except share and per share amounts)

(Unaudited)


	For the Three Months Ended
	March 31, 2019			March 31, 2018
Investment Income:
From non-controlled/non-affiliated investments:
Interest income	$	31,569		$	29,790
Payment-in-kind		302			–
Other income		651			236

Total investment income from non-controlled/non-affiliated investments		32,522			30,026
From non-controlled affiliated investments:
Payment-in-kind		369			1,941
Interest income		618			388
Dividend income		32			7
Other income		11			6

Total investment income from non-controlled affiliated investments		1,030			2,342
From controlled affiliated investments:
Payment-in-kind		535			373
Dividend income		2,450			2,800

Total investment income from controlled affiliated investments		2,985			3,173

Total investment income	$	36,537		$	35,541

Expenses:
Interest and other debt expenses	$	8,453		$	5,723
Management fees		3,536			4,803
Incentive fees		493			4,684
Professional fees		642			670
Administration, custodian and transfer agent fees		240			231
Directors’ fees		113			101
Other expenses		336			309

Total expenses	$	13,813		$	16,521

NET INVESTMENT INCOME BEFORE TAXES	$	22,724		$	19,020

Income tax expense, including excise tax	$	439		$	285

NET INVESTMENT INCOME AFTER TAXES	$	22,285		$	18,735


Net realized and unrealized gains (losses) on investment transactions:
Net realized gain (loss) from:
Non-controlled/non-affiliated investments	$	(24,722	)	$	1,667
Non-controlled affiliated investments		–			9
Foreign currency forward contracts		18			–
Foreign currency transactions		(6	)		–
Net change in unrealized appreciation (depreciation) from:
Non-controlled/non-affiliated investments		7,206			(303	)
Non-controlled affiliated investments		(2,756	)		(985	)
Controlled affiliated investments		(894	)		(225	)
Foreign currency forward contracts		78			–
Foreign currency translations		802			–

Net realized and unrealized gains (losses)	$	(20,274	)	$	163
(Provision) benefit for taxes on realized gain/loss on investments		–			(447	)
(Provision) benefit for taxes on unrealized appreciation/depreciation on investments		204			–

NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS	$	2,215		$	18,451


Net investment income per share (basic and diluted)	$	0.55		$	0.47
Earnings per share (basic and diluted)	$	0.06		$	0.46
Weighted average shares outstanding		40,261,057			40,150,518

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Statements of Changes in Net Assets

(in thousands, except share and per share amounts)

(Unaudited)


	For the Three Months Ended
	March 31, 2019			March 31, 2018
Increase (decrease) in net assets resulting from operations:
Net investment income	$	22,285		$	18,735
Net realized gain (loss)		(24,710	)		1,676
Net change in unrealized appreciation (depreciation)		4,436			(1,513	)
(Provision) benefit for taxes on realized gain/loss on investments		–			(447	)
(Provision) benefit for taxes on unrealized appreciation/depreciation on investments		204			–

Net increase (decrease) in net assets resulting from operations	$	2,215		$	18,451


Distributions to stockholders from:
Distributable earnings	$	(18,120	)	$	(18,070	)

Total distributions to stockholders	$	(18,120	)	$	(18,070	)


Capital transactions:
Reinvestment of stockholder distributions (39,591 and 23,824 shares, respectively)	$	759		$	500

Net increase (decrease) in net assets resulting from capital transactions	$	759		$	500


TOTAL INCREASE (DECREASE) IN NET ASSETS	$	(15,146	)	$	881


Net assets at beginning of period	$	709,892		$	725,830

Net assets at end of period	$	694,746		$	726,711

Distributions declared per share	$	0.45		$	0.45

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Statements of Cash Flows

(in thousands, except share and per share amounts)

(Unaudited)


	For the Three Months Ended
	March 31, 2019			March 31, 2018

Cash flows from operating activities:
Net increase (decrease) in net assets resulting from operations:	$	2,215		$	18,451
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used for) operating activities:
Purchases of investments		(126,114	)		(72,778	)
Payment-in-kind interest capitalized		(937	)		(2,113	)
Investments in affiliated money market fund, net		–			11,537
Proceeds from sales of investments and principal repayments		79,048			78,714
Net realized (gain) loss on investments		24,722			(1,676	)
Net change in unrealized (appreciation) depreciation on investments		(3,556	)		1,513
Net change in unrealized (appreciation) depreciation on foreign currency forward contracts and transactions		(71	)		–
Amortization of premium and accretion of discount, net		(2,816	)		(2,027	)
Amortization of deferred financing and debt issuance costs		638			500
Amortization of original issue discount on convertible notes		104			32
Increase (decrease) in operating assets and liabilities:
(Increase) decrease in receivable for investments sold		35			(4,000	)
(Increase) decrease in interest and dividends receivable		(1,759	)		(1,115	)
(Increase) decrease in other income receivable		–			1,308
(Increase) decrease in other assets		25			(192	)
Increase (decrease) in interest and other debt expenses payable		1,574			1,243
Increase (decrease) in management fees payable		102			156
Increase (decrease) in incentive fees payable		493			1,504
Increase (decrease) in investments purchased payable		–			89
Increase (decrease) in directors’ fees payable		113			100
Increase (decrease) in accrued expenses and other liabilities		(1,085	)		(231	)

Net cash provided by (used for) operating activities	$	(27,269	)	$	31,015


Cash flows from financing activities:
Offering costs paid		–			(83	)
Distributions paid		(17,343	)		(17,559	)
Deferred financing and debt issuance costs paid		(494	)		(1,800	)
Borrowings on debt		130,891			58,500
Repayments of debt		(86,000	)		(74,750	)

Net cash provided by (used for) financing activities	$	27,054		$	(35,692	)


Net increase (decrease) in cash		(215	)		(4,677	)
Effect of foreign exchange rate changes on cash and cash equivalents		(7	)		–
Cash, beginning of period		6,113			11,606

Cash, end of period	$	5,891		$	6,929


Supplemental and non-cash financing activities
Interest expense paid	$	5,765		$	3,714
Accrued but unpaid excise tax expense	$	625		$	529
Accrued but unpaid offering costs	$	2		$	206
Accrued but unpaid distributions	$	18,120		$	18,070
Reinvestment of stockholder distributions	$	759		$	500
Exchange of Investments	$	35,230		$	640

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of March 31, 2019

(in thousands, except share and per share amounts)

(Unaudited)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity	Par Amount ⁽⁺⁺⁾		Cost			Fair Value

Investments at Fair Value- 202.25% #

Corporate Debt⁽¹⁾ - 174.65%

1st Lien/Senior Secured Debt- 117.24%
Accuity Delivery Systems, LLC^{^ (2) (3)}	Health Care Providers & Services	9.61%	L + 7.00%; 1.00% Floor	06/13/2023	$	10,170	$	9,904		$	9,967
Apptio, Inc.^{(2) (3)}	IT Services	9.74%	L + 7.25%; 1.00% Floor	01/10/2025		26,696		26,177			26,162
Apptio, Inc.^{(2) (3) (4) (5)}	IT Services		L + 7.25%; 1.00% Floor	01/10/2025		2,225		(43	)		(45	)
Artesyn Embedded Technologies, Inc.⁽⁶⁾	Electronic Equipment, Instruments & Components	9.75%		10/15/2020		20,000		20,000			18,750
Associations, Inc.^{(2) (3)}	Real Estate Management & Development	9.80%	L + 7.00% (incl. 3.00% PIK); 1.00% Floor	07/30/2024		11,879		11,745			11,760
Associations, Inc.^{(2) (3) (4)}	Real Estate Management & Development	9.75%	L + 7.00% (incl. 3.00% PIK); 1.00% Floor	07/30/2024		2,946		1,399			1,403
Associations, Inc.^{(2) (3) (4) (5)}	Real Estate Management & Development		L + 4.00%; 1.00% Floor	07/30/2024		587		(7	)		(6	)
Avenue Stores, LLC⁽³⁾	Specialty Retail	12.50%	P + 7.00%; 2.00% Floor	09/18/2020		29,575		29,154			29,427
Brillio, LLC⁽²⁾	IT Services	7.23%	L + 4.75%; 1.00% Floor	02/06/2025		4,520		4,475			4,475
Brillio, LLC^{(2) (4) (5)}	IT Services		L + 4.75%; 1.00% Floor	02/06/2025		1,510		(15	)		(15	)
Businessolver.com, Inc.^{(2) (3)}	Health Care Technology	10.18%	L + 7.50%; 1.00% Floor	05/15/2023		12,549		12,334			12,298
Businessolver.com, Inc.^{(2) (3) (4)}	Health Care Technology	10.18%	L + 7.50%; 1.00% Floor	05/15/2023		1,882		699			684
Businessolver.com, Inc.^{(2) (3) (4)}	Health Care Technology	10.41%	L + 7.50%; 1.00% Floor	05/15/2023		1,569		288			282
Collaborative Imaging, LLC^{^^^ (2) (3)}	Health Care Providers & Services	9.25%	L + 6.50%; 1.00% Floor	03/28/2025		8,900		8,781			8,722
Continuum Managed Services LLC^{(2) (3)}	IT Services	8.50%	L + 6.00%; 1.00% Floor	06/08/2023		21,281		20,839			20,962
Continuum Managed Services LLC^{(2) (3)}	IT Services	8.50%	L + 6.00%; 1.00% Floor	06/08/2023		6,125		6,009			6,033
Continuum Managed Services LLC^{(2) (3)}	IT Services	8.50%	L + 6.00%; 1.00% Floor	06/08/2023		1,795		1,761			1,768
Continuum Managed Services LLC^{(2) (3) (4) (5)}	IT Services		L + 6.00%; 1.00% Floor	06/08/2022		2,220		(39	)		(33	)
Dade Paper & Bag, LLC^{(2) (3)}	Distributors	10.00%	L + 7.50%; 1.00% Floor	06/10/2024		10,906		10,731			10,769
Dade Paper & Bag, LLC^{(2) (3)}	Distributors	9.50%	L + 7.00%; 1.00% Floor	06/10/2024		1,391		1,379			1,342
Datto, Inc.^{(2) (3)}	IT Services	10.49%	L + 8.00%; 1.00% Floor	12/07/2022		37,027		36,461			37,027
Datto, Inc.^{(2) (3) (4) (5)}	IT Services		L + 8.00%; 1.00% Floor	12/07/2022		2,492		(36	)		–
DDS USA Holding, Inc.^{(2) (3)}	Health Care Equipment & Supplies	8.35%	L + 5.75%; 1.00% Floor	06/30/2022		3,962		3,944			3,932
DDS USA Holding, Inc.^{(2) (3)}	Health Care Equipment & Supplies	8.35%	L + 5.75%; 1.00% Floor	06/30/2022		3,834		3,817			3,805
DDS USA Holding, Inc.^{(2) (3) (4) (5)}	Health Care Equipment & Supplies		L + 5.75%; 1.00% Floor	06/30/2022		1,079		(5	)		(8	)
Diligent Corporation^{(2) (3)}	Professional Services	8.31%	L + 5.50%; 1.00% Floor	04/14/2022	€	16,138		18,466			17,877
Diligent Corporation^{(2) (3)}	Professional Services	8.35%	L + 5.50%; 1.00% Floor	04/14/2022		1,486		1,469			1,468
Diligent Corporation^{(2) (3) (4)}	Professional Services	8.23%	L + 5.50%; 1.00% Floor	04/14/2022		1,300		1,117			1,128
Diligent Corporation^{(2) (3)}	Professional Services	8.19%	L + 5.50%; 1.00% Floor	04/14/2022		510		504			504
Diligent Corporation^{(2) (3)}	Professional Services	8.35%	L + 5.50%; 1.00% Floor	04/14/2022		247		244			244
Diligent Corporation^{(2) (3) (4) (5)}	Professional Services		L + 5.50%; 1.00% Floor	04/14/2022		8,104		(93	)		(101	)
DiscoverOrg, LLC⁽²⁾	Software	7.24%	L + 4.50%	02/02/2026		16,200		16,040			15,957
DocuTAP, Inc.^{(2) (4)}	Health Care Technology		L + 5.50%; 1.00% Floor	05/09/2025		31,400		–			–
DocuTAP, Inc.^{(2) (4)}	Health Care Technology		L + 5.50%; 1.00% Floor	05/09/2025		4,800		–			–
Elemica, Inc.⁽³⁾	Software	9.50%	L + 7.00%; 1.00% Floor	07/07/2021		41,331		40,793			40,815
Elemica, Inc.^{(3) (4)}	Software	9.50%	L + 7.00%; 1.00% Floor	07/07/2021		6,000		4,728			4,725
Empirix, Inc.^{(2) (3)}	Diversified Telecommunication Services	8.86%	L + 6.25%; 1.00% Floor	09/25/2024		22,246		21,883			21,857
Empirix, Inc.^{(2) (3) (4) (5)}	Diversified Telecommunication Services		L + 6.25%; 1.00% Floor	09/25/2023		1,300		(20	)		(23	)
Fenergo Finance 3 Limited^{(2) (3) (7)}	Diversified Financial Services	9.13%	L + 6.25%; 1.00% Floor	09/05/2024	€	17,800		20,355			19,568
Fenergo Finance 3 Limited^{(2) (3) (4) (5) (7)}	Diversified Financial Services		L + 6.25%; 1.00% Floor	09/05/2024		1,182		(19	)		(24	)
Fenergo Finance 3 Limited^{(2) (3) (4) (5) (7)}	Diversified Financial Services		L + 6.25%; 1.00% Floor	09/05/2024	€	1,500		(28	)		(95	)
Gastro Health Holdco, LLC^{(2) (3)}	Health Care Providers & Services	7.99%	L + 5.50%; 1.00% Floor	09/04/2024		10,200		10,011			9,996
Gastro Health Holdco, LLC^{(2) (3) (4) (5)}	Health Care Providers & Services		L + 5.50%; 1.00% Floor	09/04/2023		2,000		(35	)		(40	)
Gastro Health Holdco, LLC^{(2) (3) (4) (5)}	Health Care Providers & Services		L + 5.50%; 1.00% Floor	09/04/2024		5,100		(58	)		(102	)

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of March 31, 2019 (continued)

(in thousands, except share and per share amounts)

(Unaudited)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity	Par Amount ⁽⁺⁺⁾		Cost			Fair Value
Granicus, Inc.⁽²⁾	Software	7.35%	L + 4.75%; 1.00% Floor	09/07/2022	$	8,379	$	8,297		$	8,295
Heligear Acquisition Co.^{(3) (6)}	Aerospace & Defense	10.25%		10/15/2019		17,500		17,457			17,106
Hygiena Borrower LLC	Life Sciences Tools & Services	6.60%	L + 4.00%; 1.00% Floor	08/26/2022		3,760		3,712			3,685
Hygiena Borrower LLC^{(4) (5)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor	08/26/2022		380		(5	)		(8	)
Hygiena Borrower LLC^{(4) (5)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor	08/26/2022		571		(4	)		(11	)
iCIMS, Inc.^{(2) (3)}	Software	8.99%	L + 6.50%; 1.00% Floor	09/12/2024		29,895		29,341			29,297
iCIMS, Inc.^{(2) (3) (4) (5)}	Software		L + 6.50%; 1.00% Floor	09/12/2024		1,868		(34	)		(37	)
Infinity Sales Group^{(3) (8)}	Media	13.11%	L + 10.50%; 1.00% Floor	11/23/2020		29,529		31,606			29,824
Integral Ad Science, Inc.^{(2) (3)}	Media	9.75%	L + 7.25% (incl. 1.25% PIK); 1.00% Floor	07/19/2024		23,806		23,377			23,329
Integral Ad Science, Inc.^{(2) (3) (4) (5)}	Media		L + 6.00%; 1.00% Floor	07/19/2023		1,815		(31	)		(36	)
Internet Truckstop Group, LLC^{(2) (4)}	Transportation Infrastructure		L + 5.50%; 1.00% Floor	04/02/2025		22,320		–			–
Internet Truckstop Group, LLC^{(2) (4)}	Transportation Infrastructure		L + 5.50%; 1.00% Floor	04/02/2025		1,800		–			–
Iracore International Holdings, Inc.^{^ (3)}	Energy Equipment & Services	11.50%	L + 9.00%; 1.00% Floor	04/12/2021		3,389		3,389			3,389
Kawa Solar Holdings Limited^{^ (3) (7) (9)}	Construction & Engineering			05/26/2020		3,917		3,603			3,839
Kawa Solar Holdings Limited^{^ (3) (7) (9)}	Construction & Engineering			05/26/2020		5,201		2,683			–
Legacy Buyer Corp.⁽³⁾	Health Care Providers & Services	10.61%	L + 8.00%; 1.00% Floor	10/24/2019		22,647		22,581			22,647
Legacy Buyer Corp.^{(3) (4) (5)}	Health Care Providers & Services		L + 8.00%; 1.00% Floor	10/24/2019		2,500		(7	)		–
Lithium Technologies, Inc.^{(2) (3)}	Internet Software & Services	10.49%	L + 8.00%; 1.00% Floor	10/03/2022		38,966		38,237			38,187
Lithium Technologies, Inc.^{(2) (3) (4) (5)}	Internet Software & Services		L + 8.00%; 1.00% Floor	10/03/2022		2,684		(47	)		(54	)
Madison-Kipp Corporation⁽³⁾	Machinery	11.50%	L + 9.00%; 1.00% Floor	05/26/2020		29,787		29,619			29,712
Mailgun Technologies, Inc.⁽²⁾	Internet Software & Services	8.61%	L + 6.00%; 1.00% Floor	03/26/2025		13,190		12,927			12,926
Mailgun Technologies, Inc.^{(2) (4) (5)}	Internet Software & Services		L + 6.00%; 1.00% Floor	03/26/2025		1,530		(31	)		(31	)
Midwest Transport, Inc.^{(2) (3)}	Road & Rail	9.65%	L + 7.00%; 1.00% Floor	10/02/2023		12,383		12,269			12,259
MMIT Holdings, LLC^{(2) (3)}	Health Care Technology	8.00%	L + 5.50%; 1.00% Floor	11/15/2024		16,459		16,142			16,130
MMIT Holdings, LLC^{(2) (3) (4) (5)}	Health Care Technology		L + 5.50%; 1.00% Floor	11/15/2024		3,188		(60	)		(64	)
Netvoyage Corporation^{(2) (3)}	Software	11.50%	L + 9.00%; 1.00% Floor	03/24/2024		8,579		8,464			8,429
Netvoyage Corporation^{(2) (3) (4) (5)}	Software		L + 9.00%; 1.00% Floor	03/24/2022		654		(8	)		(11	)
Pathway Vet Alliance LLC⁽²⁾	Health Care Providers & Services	7.00%	L + 4.50%	12/20/2024		4,807		4,760			4,759
Pathway Vet Alliance LLC^{(2) (4)}	Health Care Providers & Services	7.00%	L + 4.50%	12/21/2024		1,695		143			143
Picture Head Midco LLC^{(2) (3)}	Media	9.25%	L + 6.75%; 1.00% Floor	08/31/2023		23,120		22,702			22,715
Picture Head Midco LLC^{(2) (3) (4)}	Media	9.25%	L + 6.75%; 1.00% Floor	08/31/2023		2,540		715			718
Power Stop, LLC⁽²⁾	Auto Components	7.35%	L + 4.75%	10/19/2025		7,581		7,563			7,505
SF Home Décor, LLC^{(2) (3)}	Household Products	12.11%	L + 9.50%; 1.00% Floor	07/13/2022		19,795		19,366			19,251
Shopatron, LLC⁽²⁾	Internet Catalog & Retail	11.61%	L + 9.00%; 1.00% Floor	12/18/2020		4,289		4,208			4,203
SPay, Inc.^{(2) (3)}	Internet Software & Services	8.24%	L + 5.75%; 1.00% Floor	06/17/2024		10,332		10,148			9,970
SPay, Inc.^{(2) (3) (4)}	Internet Software & Services	8.38%	L + 5.75%; 1.00% Floor	06/17/2024		1,140		436			416
SPay, Inc.^{(2) (3) (4)}	Internet Software & Services	8.55%	L + 5.75%; 1.00% Floor	06/17/2024		5,720		331			181
The Merit Distribution Group, LLC⁽³⁾	Distributors	13.88%	L + 11.25%; 0.50% Floor	04/08/2021		22,375		22,101			22,375
US Med Acquisition, Inc.⁽³⁾	Health Care Equipment & Supplies	11.60%	L + 9.00%; 1.00% Floor	08/13/2021		29,876		29,592			28,084
Vexos, Inc.⁽³⁾	Electronic Equipment, Instruments & Components	12.30%	L + 9.50%; 1.00% Floor	10/09/2019		35,922		35,823			35,653
VRC Companies, LLC⁽³⁾	Commercial Services & Supplies	9.00%	L + 6.50%; 1.00% Floor	03/31/2023		3,674		3,641			3,637
VRC Companies, LLC^{(3) (4)}	Commercial Services & Supplies	9.00%	L + 6.50%; 1.00% Floor	03/31/2023		1,503		426			425

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of March 31, 2019 (continued)

(in thousands, except share and per share amounts)

(Unaudited)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity	Par Amount ⁽⁺⁺⁾		Cost			Fair Value
VRC Companies, LLC^{(3) (4)}	Commercial Services & Supplies	9.31%	L + 6.50%; 1.00% Floor	03/31/2022	$	175	$	110		$	109
Wine.com, LLC^{(2) (3)}	Beverages	9.86%	L + 7.00%; 1.00% Floor	11/14/2024		6,400		6,278			6,272
Wrike, Inc.^{(2) (3)}	Professional Services	9.25%	L + 6.75%; 1.00% Floor	12/31/2024		16,223		15,909			15,899
Wrike, Inc.^{(2) (3) (4) (5)}	Professional Services		L + 6.75%; 1.00% Floor	12/31/2024		1,600		(31	)		(32	)
Xactly Corporation^{(2) (3)}	Internet Software & Services	9.75%	L + 7.25%; 1.00% Floor	07/29/2022		22,860		22,525			22,517
Xactly Corporation^{(2) (3) (4) (5)}	Internet Software & Services		L + 7.25%; 1.00% Floor	07/29/2022		1,697		(23	)		(25	)
Yasso, Inc.^{(2) (3)}	Food Products	10.25%	L + 7.75%; 1.00% Floor	03/23/2022		8,096		7,991			7,752

Total 1st Lien/Senior Secured Debt								823,300			814,544

1st Lien/Last-Out Unitranche⁽¹⁰⁾ – 14.55%
Intelligent Document Solutions, Inc.^{(2) (3)}	Diversified Financial Services	8.60%	L + 6.00%; 1.00% Floor	02/28/2024		11,900		11,568			11,543
Mervin Manufacturing, Inc.⁽³⁾	Leisure Equipment & Products	10.28%	L + 7.50%	10/10/2019		11,165		11,134			10,857
NTS Communications, Inc.^{^ (3) (11)}	Diversified Telecommunication Services		L + 9.00% PIK; 1.25% Floor	06/06/2019		60,462		55,968			48,854
NTS Communications, Inc.^{^ (3)}	Diversified Telecommunication Services	11.61%	L + 9.00% PIK; 1.25% Floor	06/06/2019		6,693		6,537			6,693
RugsUSA, LLC^{(2) (3)}	Household Products	8.61%	L + 6.00%; 1.00% Floor	04/30/2023		5,840		5,791			5,782
Smarsh, Inc.^{(2) (3)}	Software	10.38%	L + 7.88%; 1.00% Floor	03/31/2021		17,534		17,357			17,358

Total 1st Lien/Last-Out Unitranche								108,355			101,087

2nd Lien/Senior Secured Debt- 41.89%
American Dental Partners, Inc.^{(2) (3)}	Health Care Providers & Services	11.10%	L + 8.50%; 1.00% Floor	09/25/2023		5,738		5,629			5,623
Bolttech Mannings, Inc.^{^^ (3)}	Commercial Services & Supplies	10.63%	L + 8.00% PIK	11/19/2021		20,158		20,158			19,956
Country Fresh Holdings, LLC^{(2) (3) (11)}	Food Products		L + 8.75%; 1.00% Floor	10/02/2023		9,400		9,246			940
DiscoverOrg, LLC⁽²⁾	Software	11.24%	L + 8.50%	02/01/2027		10,000		9,851			9,975
DuBois Chemicals, Inc.⁽²⁾	Chemicals	10.50%	L + 8.00%; 1.00% Floor	03/15/2025		26,220		25,788			25,433
ERC Finance, LLC^{(2) (3)}	Health Care Providers & Services	10.72%	L + 8.22%; 1.00% Floor	09/22/2025		19,800		19,415			19,404
Genesis Acquisition Co.^{(2) (3)}	Diversified Financial Services	10.24%	L + 7.50%	07/31/2025		7,000		6,837			6,808
Genesis Acquisition Co.^{(2) (3) (4) (5)}	Diversified Financial Services		L + 7.50%	07/31/2025		1,800		(20	)		(49	)
Hygiena Borrower LLC⁽³⁾	Life Sciences Tools & Services	10.35%	L + 7.75%; 1.00% Floor	08/26/2023		1,860		1,827			1,828
Hygiena Borrower LLC^{(3) (4)}	Life Sciences Tools & Services	10.35%	L + 7.75%; 1.00% Floor	08/26/2023		680		90			85
ICP Industrial, Inc.^{(2) (3)}	Chemicals	10.74%	L + 8.25%; 1.00% Floor	05/03/2024		20,400		19,975			19,992
IHS Intermediate Inc.⁽³⁾	Health Care Providers & Services	11.02%	L + 8.25%; 1.00% Floor	07/20/2022		10,000		9,887			9,200
Market Track, LLC^{(2) (3)}	Internet Catalog & Retail	10.49%	L + 7.75%; 1.00% Floor	06/05/2025		22,200		21,644			21,090
MPI Products LLC^{(3) (8)}	Auto Components	11.63%	L + 9.00%; 1.00% Floor	01/30/2020		20,000		19,967			19,600
National Spine and Pain Centers, LLC^{(2) (3)}	Health Care Providers & Services	10.75%	L + 8.25%; 1.00% Floor	12/02/2024		19,100		18,630			18,623
Odyssey Logistics & Technology Corporation⁽²⁾	Road & Rail	10.50%	L + 8.00%; 1.00% Floor	10/12/2025		18,722		18,349			18,285
P2 Upstream Acquisition Co.	Software	10.74%	L + 8.00%; 1.00% Floor	04/30/2021		3,500		3,487			3,351
SMB Shipping Logistics, LLC^{(2) (3)}	Air Freight & Logistics	10.86%	L + 8.00%; 1.00% Floor	02/03/2025		41,667		41,046			40,833
Spectrum Plastics Group, Inc.⁽²⁾	Containers & Packaging	9.50%	L + 7.00%; 1.00% Floor	01/31/2026		6,248		6,220			5,974
Viant Medical Holdings, Inc.⁽²⁾	Health Care Equipment & Supplies	10.35%	L + 7.75%	07/02/2026		8,260		8,182			8,260
YI, LLC^{(2) (3)}	Health Care Equipment & Supplies	10.35%	L + 7.75%; 1.00% Floor	11/07/2025		15,300		14,898			14,879
Zep Inc.⁽²⁾	Chemicals	10.85%	L + 8.25%; 1.00% Floor	08/11/2025		23,800		23,287			20,944

Total 2nd Lien/Senior Secured Debt								304,393			291,034

Unsecured Debt- 0.97%
CB-HDT Holdings, Inc.^{^ (3)}	Aerospace & Defense	12.00% PIK		12/15/2019		3,931		3,932			3,922
CB-HDT Holdings, Inc.^{^ (3)}	Aerospace & Defense	12.00% PIK		03/05/2021		1,715		1,715			1,715

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of March 31, 2019 (continued)

(in thousands, except share and per share amounts)

(Unaudited)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity	Par Amount ⁽⁺⁺⁾		Cost		Fair Value
Conergy Asia & ME Pte. LTD.^{^ (3) (7)}	Construction & Engineering	10.00%		05/26/2020	$	1,064	$	1,064	$	1,064

Total Unsecured Debt								6,711		6,701

Total Corporate Debt								1,242,759		1,213,366

Portfolio Company		Industry	Coupon		Shares		Cost		Fair Value

Preferred Stock⁽¹⁾ - 6.46%
Accuity Delivery Systems, LLC^{^ (2) (3) (6) (9)}	Health Care Providers & Services					97,130	$	3,200	$	4,160
Animal Supply Holdings, LLC^{^^ (3) (6) (9)}	Distributors					250,000		25,000		25,260
CB-HDT Holdings, Inc.^{^ (3) (6) (9)}	Aerospace & Defense					1,108,333		10,185		13,488
Conergy Asia Holdings, Ltd.^{^ (3) (6) (7) (9)}	Construction & Engineering					600,000		600		–
Kawa Solar Holdings Limited^{^ (3) (6) (7) (11)}	Construction & Engineering		8.00% PIK			59,611		778		–
NTS Communications, Inc.^{^ (3) (6) (9)}	Diversified Telecommunication Services					263		187		–
Wine.com, LLC^{(2) (3) (6) (9)}	Beverages					221,072		1,900		1,957

Total Preferred Stock								41,850		44,865

Common Stock⁽¹⁾ - 7.33%
Animal Supply Holdings, LLC^{^^ (3) (6) (9)}	Distributors					404,584		29,230		28,976
Bolttech Mannings, Inc.^{^^ (3) (6) (9)}	Commercial Services & Supplies					8,000		6,591		4,064
CB-HDT Holdings, Inc.^{^ (3) (6) (9)}	Aerospace & Defense					453,383		2,393		4,280
Collaborative Imaging Holdco, LLC - Class B^{^^^ (2) (3) (6)}	Health Care Providers & Services					8,464		1,141		1,286
Collaborative Imaging Holdco, LLC - Class C^{^^^ (2) (3) (6) (7) (9)}	Health Care Providers & Services					7,988		159		177
Conergy Asia Holdings, Ltd.^{^ (3) (6) (7) (9)}	Construction & Engineering					2,000		4,700		–
Continuum Managed Services LLC - Class A^{(2) (3) (6) (9)}	IT Services					733		733		861
Continuum Managed Services LLC - Class B^{(2) (3) (6) (9)}	IT Services					496,698		7		844
Elah Holdings, Inc.^{^ (2) (3) (6) (9)}	Capital Markets					46,214		2,234		2,234
Iracore International Holdings, Inc.^{^ (3) (6) (9)}	Energy Equipment & Services					28,898		7,003		4,783
Kawa Solar Holdings Limited^{^ (3) (6) (7) (9)}	Construction & Engineering					1,399,556		–		–
National Spine and Pain Centers, LLC^{(2) (3) (6) (9)}	Health Care Providers & Services					600		600		279
NTS Communications, Inc.^{^ (3) (6) (9)}	Diversified Telecommunication Services					595,215		3		–
Prairie Provident Resources, Inc.^{^^^ (7) (9)}	Oil, Gas & Consumable Fuels					3,579,988		9,237		456
Wrike, Inc.^{(2) (3) (6) (9)}	Professional Services					348,478		2,165		2,505
Yasso, Inc.^{(2) (3) (6) (9)}	Food Products					850		850		190

Total Common Stock								67,046		50,935

Portfolio Company					LLC Interest		Cost		Fair Value

Investment Funds & Vehicles⁽¹⁾ - 13.81%
Senior Credit Fund, LLC^{^^ (7)}					$	100,000	$	100,000	$	95,931

Total Investment Funds & Vehicles								100,000		95,931

TOTAL INVESTMENTS – 202.25%							$	1,451,655	$	1,405,097

LIABILITIES IN EXCESS OF OTHER ASSETS - (102.25%)									$	(710,351	)

NET ASSETS – 100.00%									$	694,746

⁽⁺⁾

The Consolidated Schedule of Investments discloses the actual interest rate for partially or fully funded debt in effect as of the reporting date. Variable rate loans bear interest at a rate that may be determined by reference to either LIBOR (“L”) or alternate base rate (commonly based on the Prime Rate (“P”)), at the borrower’s option, which reset periodically based on the terms of the credit agreement. L loans are typically indexed to 12 month, 6 month, 3 month, 2 month, 1 month or 1 week L rates. As of March 31, 2019, rates for the 12 month, 6 month, 3 month, 2 month, 1 month and 1 week L are 2.71%, 2.66%, 2.60%, 2.56%, 2.49% and 2.42%, respectively. As of March 31, 2019, P was 5.50%. For investments with multiple reference rates or alternate base rates, the interest rate shown is the weighted average interest rate in effect at March 31, 2019.

⁽⁺⁺⁾

Par amount is denominated in U.S. Dollars (“$”) unless otherwise noted, Euro (“€”).

Percentages are based on net assets.

^{^}

As defined in the Investment Company Act of 1940, the investment is deemed to be an “affiliated person” of the Company because the Company owns, either directly or indirectly, 5% or more of the portfolio company’s outstanding voting securities. See Note 3 “Significant Agreements and Related Party Transactions”.

^{^^}

As defined in the Investment Company Act of 1940, the investment is deemed to be a “controlled affiliated person” of the Company because the Company owns, either directly or indirectly, 25% or more of the portfolio company’s outstanding voting securities or has the power to exercise control over management or policies of such portfolio company. See Note 3 “Significant Agreements and Related Party Transactions”.

^{^^^}

The portfolio company is otherwise deemed to be an “affiliated person” of the Company under the Investment Company Act of 1940. See Note 3 “Significant Agreements and Related Party Transactions”.

⁽¹⁾

Assets are pledged as collateral for the Revolving Credit Facility. See Note 6 “Debt”.

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of March 31, 2019 (continued)

(in thousands, except share and per share amounts)

(Unaudited)

⁽²⁾

Represent co-investments made with the Company’s affiliates in accordance with the terms of the exemptive relief that the Company received from the U.S. Securities and Exchange Commission. See Note 3 “Significant Agreements and Related Party Transactions”.

⁽³⁾

The fair value of the investment was determined using significant unobservable inputs. See Note 5 “Fair Value Measurement”.

⁽⁴⁾

Position or portion thereof is an unfunded loan commitment, and no interest is being earned on the unfunded portion. The unfunded loan commitment may be subject to a commitment termination date that may expire prior to the maturity date stated. See Note 8 “Commitments and Contingencies”.

⁽⁵⁾

The negative cost is the result of the capitalized discount being greater than the principal amount outstanding on the loan. The negative fair value is the result of the capitalized discount on the loan.

⁽⁶⁾

Securities 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 March 31, 2019, the aggregate fair value of these securities is $131,200 or 18.88% of the Company’s net assets. The acquisition dates of the restricted securities are as follows:


Investment		Acquisition Date
Accuity Delivery Systems, LLC – Preferred Stock		06/13/2018
Animal Supply Holdings LLC – Common Stock		02/22/2019
Animal Supply Holdings, LLC – Preferred Stock		02/22/2019
Artesyn Embedded Technologies, Inc. – 1st Lien/Senior Secured Debt		09/26/2013
Bolttech Mannings, Inc. – Common Stock		12/22/2017
CB-HDT Holdings, Inc. – Preferred Stock		07/01/2016
CB-HDT Holdings, Inc. – Common Stock		07/01/2016
Collaborative Imaging Holdco, LLC – Class B – Common Stock		03/30/2018
Collaborative Imaging Holdco, LLC – Class C – Common Stock		03/30/2018
Conergy Asia Holdings, Ltd. – Common Stock		07/31/2017
Conergy Asia Holdings, Ltd. – Preferred Stock		08/23/2017
Continuum Managed Services LLC – Class A – Common Stock		06/08/2017
Continuum Managed Services LLC – Class B – Common Stock		06/08/2017
Elah Holdings, Inc. – Common Stock		05/09/2018
Heligear Acquisition Co. – 1st Lien/Senior Secured Debt		09/30/2014
Iracore International Holdings, Inc. – Common Stock		04/13/2017
Kawa Solar Holdings Limited – Common Stock		08/17/2016
Kawa Solar Holdings Limited – Preferred Stock		10/25/2016
NTS Communications, Inc. – Preferred Stock		07/22/2016
NTS Communications, Inc. – Common Stock		07/22/2016
National Spine and Pain Centers, LLC – Common Stock		06/02/2017
Wine.com, LLC – Preferred Stock		11/14/2018
Wrike, Inc. – Common Stock		12/31/2018
Yasso, Inc. – Common Stock		03/23/2017

⁽⁷⁾

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 March 31, 2019 the aggregate fair value of these securities is $120,916 or 8.47% of the Company’s total assets.

⁽⁸⁾

The investment includes an exit fee that is receivable upon repayment of the loan. See Note 2 “Significant Accounting Policies”.

⁽⁹⁾

Non-income producing security.

⁽¹⁰⁾

In exchange for the greater risk of loss, the “last-out” portion of the Company’s unitranche loan investment generally earns a higher interest rate than the “first-out” portions. The “first-out” portion of the loan would generally receive priority with respect to payment of principal, interest and any other amounts due thereunder over the “last-out” portion that the Company would continue to hold.

⁽¹¹⁾

The investment is on non-accrual status as of March 31, 2019.

PIK – Payment-In-Kind

ADDITIONAL INFORMATION

Foreign currency forward contracts

Counterparty

Currency
Purchased

Currency
Sold

Settlement

Unrealized Appreciation
(Depreciation)

Bank of America, N.A.

USD 355

EUR 301

04/03/2019

Bank of America, N.A.

USD 309

EUR 260

05/06/2019

Bank of America, N.A.

USD 375

EUR 315

07/03/2019

Bank of America, N.A.

USD 311

EUR 260

08/05/2019

Bank of America, N.A.

USD 394

EUR 329

10/04/2019

Bank of America, N.A.

USD 324

EUR 269

11/05/2019

Bank of America, N.A.

USD 393

EUR 325

01/06/2020

Bank of America, N.A.

USD 399

EUR 327

04/06/2020

Bank of America, N.A.

USD 400

EUR 325

07/06/2020

167

Currency Abbreviations:

EUR – Euro

USD – U.S. Dollar

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of December 31, 2018

(in thousands, except share and per share amounts)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread⁽⁺⁾	Maturity	Par Amount⁽⁺⁺⁾		Cost			Fair Value

Investments at Fair Value– 193.75% #

Corporate Debt ⁽¹⁾– 173.98%

1st Lien/Senior Secured Debt– 102.78%
Accuity Delivery Systems, LLC^{^ (2) (3)}	Health Care Providers & Services	9.78%	L + 7.00%; 1.00% Floor	06/13/2023	$	10,170	$	9,892		$	9,890
Apptio, Inc.^{(2) (4)}	IT Services		L + 7.25%; 1.00% Floor	1/10/2025		26,696		–			–
Apptio, Inc.^{(2) (4)}	IT Services		L + 7.25%; 1.00% Floor	1/10/2025		2,225		–			–
Artesyn Embedded Technologies, Inc.⁽⁵⁾	Electronic Equipment, Instruments & Components	9.75%		10/15/2020		20,000		20,000			18,400
Associations, Inc.^{(2) (3)}	Real Estate Management & Development	9.40%	L + 7.00% (incl. 3.00% PIK); 1.00% Floor	07/30/2024		11,788		11,650			11,671
Associations, Inc.^{(2) (3) (4)}	Real Estate Management & Development	9.40%	L + 7.00% (incl. 3.00% PIK); 1.00% Floor	07/30/2024		2,938		1,012			1,017
Associations, Inc.^{(2) (3) (4) (6)}	Real Estate Management & Development		L + 4.00%; 1.00% Floor	07/30/2024		587		(7	)		(6	)
Avenue Stores, LLC⁽³⁾	Specialty Retail	10.62%	L + 8.00%; 1.00% Floor	09/18/2020		30,300		29,874			29,467
Businessolver.com, Inc.^{(2) (3)}	Health Care Technology	10.12%	L + 7.50%; 1.00% Floor	05/15/2023		12,549		12,323			12,298
Businessolver.com, Inc.^{(2) (3) (4)}	Health Care Technology	12.00%	P + 6.50%; 2.00% Floor	05/15/2023		1,569		600			596
Businessolver.com, Inc.^{(2) (3) (4)}	Health Care Technology	10.12%	L + 7.50%; 1.00% Floor	05/15/2023		1,882		450			433
Collaborative Imaging, LLC^{^^^ (2) (3)}	Health Care Providers & Services	9.03%	L + 6.50%; 1.00% Floor	03/28/2025		8,900		8,777			8,722
Continuum Managed Services LLC^{(2) (3)}	IT Services	8.53%	L + 6.00%; 1.00% Floor	06/08/2023		21,335		20,870			20,908
Continuum Managed Services LLC^{(2) (3)}	IT Services	8.53%	L + 6.00%; 1.00% Floor	06/08/2023		6,140		6,017			6,017
Continuum Managed Services LLC^{(2) (3)}	IT Services	8.53%	L + 6.00%; 1.00% Floor	06/08/2023		1,800		1,763			1,764
Continuum Managed Services LLC^{(2) (3) (4)} ⁽⁶⁾	IT Services		L + 6.00%; 1.00% Floor	06/08/2022		2,220		(42	)		(44	)
Dade Paper & Bag, LLC^{(2) (3)}	Distributors	10.02%	L + 7.50%; 1.00% Floor	06/10/2024		10,934		10,752			10,769
Dade Paper & Bag, LLC^{(2) (3)}	Distributors	9.52%	L + 7.00%; 1.00% Floor	06/10/2024		1,395		1,382			1,342
Datto, Inc.⁽²⁾	IT Services	10.46%	L + 8.00%; 1.00% Floor	12/07/2022		37,027		36,429			36,749
Datto, Inc.^{(2) (4) (6)}	IT Services		L + 8.00%; 1.00% Floor	12/07/2022		2,492		(39	)		(19	)
DDS USA Holding, Inc.⁽²⁾	Health Care Equipment & Supplies	8.57%	L + 5.75%; 1.00% Floor	06/30/2022		3,972		3,953			3,942
DDS USA Holding, Inc.⁽²⁾	Health Care Equipment & Supplies	8.57%	L + 5.75%; 1.00% Floor	06/30/2022		3,843		3,825			3,815
DDS USA Holding, Inc.^{(2) (4) (6)}	Health Care Equipment & Supplies		L + 5.75%; 1.00% Floor	06/30/2022		1,079		(5	)		(8	)
Diligent Corporation^{(2) (3)}	Professional Services	8.03%	L + 5.50%; 1.00% Floor	04/14/2022	€	16,179		18,496			18,305
Diligent Corporation^{(2) (3)}	Professional Services	8.03%	L + 5.50%; 1.00% Floor	04/14/2022		512		505			505
Diligent Corporation^{(2) (3) (4)}	Professional Services	8.28%	L + 5.50%; 1.00% Floor	04/14/2022		1,300		491			504
Diligent Corporation^{(2) (3) (4) (6)}	Professional Services		L + 5.50%; 1.00% Floor	04/14/2022		247		(3	)		(3	)
Diligent Corporation^{(2) (3) (4) (6)}	Professional Services		L + 5.50%; 1.00% Floor	04/14/2022		9,590		(120	)		(120	)
Elemica, Inc.⁽³⁾	Software	9.52%	L + 7.00%; 1.00% Floor	07/07/2021		41,438		40,844			40,920
Elemica, Inc.^{(3) (4) (6)}	Software		L + 7.00%; 1.00% Floor	07/07/2021		6,000		(80	)		(75	)
Empirix, Inc.^{(2) (3)}	Diversified Telecommunication Services	8.93%	L + 6.25%; 1.00% Floor	09/25/2024		22,300		21,924			21,910
Empirix, Inc.^{(2) (3) (4) (6)}	Diversified Telecommunication Services		L + 6.25%; 1.00% Floor	09/25/2023		1,300		(22	)		(23	)
Fenergo Finance 3 Limited^{(2) (3) (7)}	Diversified Financial Services	9.13%	L + 6.25%; 1.00% Floor	09/05/2024	€	17,800		20,344			19,986
Fenergo Finance 3 Limited^{(2) (3) (4) (6) (7)}	Diversified Financial Services		L + 6.25%; 1.00% Floor	09/05/2024		1,182		(20	)		(24	)
Fenergo Finance 3 Limited^{(2) (3) (4) (6) (7)}	Diversified Financial Services		L + 6.25%; 1.00% Floor	09/05/2024	€	1,500		(29	)		(59	)
Gastro Health Holdco, LLC^{(2) (3)}	Health Care Providers & Services	8.74%	L + 6.00%; 1.00% Floor	09/04/2024		10,200		10,005			9,996
Gastro Health Holdco, LLC^{(2) (3) (4) (6)}	Health Care Providers & Services		L + 6.00%; 1.00% Floor	09/04/2023		2,000		(37	)		(40	)
Gastro Health Holdco, LLC^{(2) (3) (4) (6)}	Health Care Providers & Services		L + 6.00%; 1.00% Floor	09/04/2024		5,100		(60	)		(102	)
Heligear Acquisition Co.^{(3) (5)}	Aerospace & Defense	10.25%		10/15/2019		17,500		17,438			17,106
Hygiena Borrower LLC	Life Sciences Tools & Services	6.80%	L + 4.00%; 1.00% Floor	08/26/2022		3,769		3,719			3,694
Hygiena Borrower LLC^{(4) (6)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor	08/26/2022		380		(5	)		(8	)
Hygiena Borrower LLC^{(4) (6)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor	08/26/2022		571		(4	)		(11	)

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of December 31, 2018 (continued)

(in thousands, except share and per share amounts)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread⁽⁺⁾	Maturity	Par Amount⁽⁺⁺⁾		Cost			Fair Value
iCIMS, Inc.^{(2) (3)}	Software	8.94%	L + 6.50%; 1.00% Floor	09/12/2024	$	29,895	$	29,321		$	29,297
iCIMS, Inc.^{(2) (3) (4) (6)}	Software		L + 6.50%; 1.00% Floor	09/12/2024		1,868		(35	)		(37	)
Infinity Sales Group^{(3) (8)}	Media	13.31%	L + 10.50%; 1.00% Floor	11/23/2020		29,529		30,739			29,529
Integral Ad Science, Inc.^{(2) (3)}	Media	9.78%	L + 7.25% (incl.1.25% PIK); 1.00% Floor	07/19/2024		23,733		23,289			23,258
Integral Ad Science, Inc.^{(2) (3) (4) (6)}	Media		L + 6.00%; 1.00% Floor	07/19/2023		1,815		(33	)		(36	)
Iracore International Holdings, Inc.^{^ (3)}	Energy Equipment & Services	11.63%	L + 9.00%; 1.00% Floor	04/12/2021		3,389		3,389			3,389
Kawa Solar Holdings Limited^{^ (3) (7) (9)}	Construction & Engineering		L + 8.00% PIK	05/26/2020		8,460		8,150			8,066
Kawa Solar Holdings Limited^{^ (3) (7) (10)}	Construction & Engineering			05/26/2020		5,201		2,683			–
Legacy Buyer Corp.⁽³⁾	Health Care Providers & Services	10.81%	L + 8.00%; 1.00% Floor	10/24/2019		22,841		22,746			22,841
Legacy Buyer Corp.^{(3) (4) (6)}	Health Care Providers & Services		L + 8.00%; 1.00% Floor	10/24/2019		2,500		(10	)		–
Lithium Technologies, Inc.^{(2) (3)}	Internet Software & Services	10.39%	L + 8.00%; 1.00% Floor	10/03/2022		38,966		38,194			38,187
Lithium Technologies, Inc.^{(2) (3) (4) (6)}	Internet Software & Services		L + 8.00%; 1.00% Floor	10/03/2022		2,684		(50	)		(54	)
Madison-Kipp Corporation⁽³⁾	Machinery	11.53%	L + 9.00%; 1.00% Floor	05/26/2020		29,879		29,677			29,805
Midwest Transport, Inc.⁽²⁾	Road & Rail	9.80%	L + 7.00%; 1.00% Floor	10/02/2023		12,541		12,421			12,416
MMIT Holdings, LLC⁽²⁾	Health Care Technology	8.02%	L + 5.50%; 1.00% Floor	11/15/2024		8,900		8,725			8,722
MMIT Holdings, LLC^{(2) (4) (6)}	Health Care Technology		L + 5.50%; 1.00% Floor	11/15/2024		2,550		(50	)		(51	)
Netvoyage Corporation^{(2) (3)}	Software	11.53%	L + 9.00%; 1.00% Floor	03/24/2022		8,601		8,477			8,494
Netvoyage Corporation^{(2) (3) (4) (6)}	Software		L + 9.00%; 1.00% Floor	03/24/2022		654		(8	)		(8	)
Picture Head Midco LLC^{(2) (3)}	Media	9.27%	L + 6.75%; 1.00% Floor	08/31/2023		23,120		22,683			22,658
Picture Head Midco LLC^{(2) (3) (4)}	Media	9.27%	L + 6.75%; 1.00% Floor	08/31/2023		2,540		738			711
Picture Head Midco LLC^{(2) (3) (4) (6)}	Media		L + 6.75%; 1.00% Floor	08/31/2023		2,540		(47	)		(51	)
Power Stop, LLC⁽²⁾	Auto Components	7.55%	L + 4.75%	10/19/2025		7,600		7,581			7,562
SF Home Décor, LLC^{(2) (3)}	Household Products	12.31%	L + 9.50%; 1.00% Floor	07/13/2022		20,063		19,601			19,511
SPay, Inc.^{(2) (3)}	Internet Software & Services	8.22%	L + 5.75%; 1.00% Floor	06/17/2024		10,300		10,109			10,042
SPay, Inc.^{(2) (3) (4)}	Internet Software & Services	8.34%	L + 5.75%; 1.00% Floor	06/17/2024		1,140		815			807
SPay, Inc.^{(2) (3) (4) (6)}	Internet Software & Services		L + 5.75%; 1.00% Floor	06/17/2024		5,720		(52	)		(143	)
The Merit Distribution Group, LLC⁽³⁾	Distributors	14.06%	L + 11.25%; 0.50% Floor	04/08/2021		22,375		22,071			22,207
US Med Acquisition, Inc.⁽³⁾	Health Care Equipment & Supplies	11.80%	L + 9.00%; 1.00% Floor	08/13/2021		29,954		29,643			27,782
Vexos, Inc.⁽³⁾	Electronic Equipment, Instruments & Components	11.90%	L + 9.50%; 1.00% Floor	10/09/2019		36,235		36,089			35,872
VRC Companies, LLC^{(3) (4)}	Commercial Services & Supplies	9.03%	L + 6.50%; 1.00% Floor	03/31/2023		3,683		2,776			2,774
VRC Companies, LLC^{(3) (4)}	Commercial Services & Supplies	9.45%	L + 6.50%; 1.00% Floor	03/31/2022		175		88			88
Wine.com, LLC⁽²⁾	Beverages	9.86%	L + 7.00%; 1.00% Floor	11/14/2024		6,400		6,274			6,272
Wrike, Inc.⁽²⁾	Professional Services	9.28%	L + 6.75%; 1.00% Floor	12/31/2024		19,712		19,317			19,317
Wrike, Inc.^{(2) (4) (6)}	Professional Services		L + 6.75%; 1.00% Floor	12/31/2024		1,600		(32	)		(32	)
Xactly Corporation^{(2) (3)}	Internet Software & Services	9.78%	L + 7.25%; 1.00% Floor	07/29/2022		22,860		22,504			22,517
Xactly Corporation^{(2) (3) (4) (6)}	Internet Software & Services		L + 7.25%; 1.00% Floor	07/29/2022		1,697		(25	)		(25	)
Yasso, Inc.^{(2) (3)}	Food Products	10.27%	L + 7.75%; 1.00% Floor	03/23/2022		8,119		8,006			7,733

Total 1st Lien/Senior Secured Debt								738,626			729,604

1st Lien/Last-Out Unitranche⁽¹¹⁾ – 15.05%
ASC Acquisition Holdings, LLC⁽³⁾	Distributors	10.03%	L + 7.50%; 1.00% Floor	12/15/2021		6,000		5,883			5,850
Intelligent Document Solutions, Inc.^{(2) (3)}	Diversified Financial Services	8.80%	L + 6.00%; 1.00% Floor	02/28/2024		11,900		11,555			11,543
Mervin Manufacturing, Inc.⁽³⁾	Leisure Equipment & Products	9.94%	L + 7.50%	10/10/2019		11,165		11,120			10,746
NTS Communications, Inc.^{^ (3) (9)}	Diversified Telecommunication Services		L + 9.00% PIK; 1.25% Floor	06/06/2019		58,747		55,968			49,054

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of December 31, 2018 (continued)

(in thousands, except share and per share amounts)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread⁽⁺⁾	Maturity	Par Amount⁽⁺⁺⁾		Cost			Fair Value
NTS Communications, Inc.^{^ (3)}	Diversified Telecommunication Services	11.81%	L + 9.00% PIK; 1.25% Floor	06/06/2019	$	6,503	$	6,309		$	6,503
RugsUSA, LLC^{(2) (3)}	Household Products	9.31%	L + 6.50%; 1.00% Floor	04/30/2023		5,840		5,788			5,781
Smarsh, Inc.^{(2) (3)}	Software	10.41%	L + 7.88%; 1.00% Floor	03/31/2021		17,578		17,381			17,402

Total 1st Lien/Last-Out Unitranche								114,004			106,879

2nd Lien/Senior Secured Debt– 55.21%
American Dental Partners, Inc.^{(2) (3)}	Health Care Providers & Services	11.30%	L + 8.50%; 1.00% Floor	09/25/2023		5,738		5,624			5,623
ASC Acquisition Holdings, LLC^{(3) (9)}	Distributors		L + 17.00% (incl. 4.00% PIK); 1.00% Floor	12/15/2022		30,307		29,689			21,745
ASC Acquisition Holdings, LLC^{(3) (9)}	Distributors		L + 17.00% (incl. 4.00% PIK); 1.00% Floor	12/15/2022		24,851		24,423			17,831
Bolttech Mannings, Inc.^{^^ (3)}	Commercial Services & Supplies	10.74%	L + 8.00% PIK	11/19/2021		19,626		19,626			19,429
Country Fresh Holdings, LLC^{(2) (3)}	Food Products	11.20%	L + 8.75%; 1.00% Floor	10/02/2023		9,400		9,246			7,802
DiscoverOrg, LLC⁽³⁾	Software	11.03%	L + 8.50%; 1.00% Floor	02/23/2024		59,500		58,540			59,054
DuBois Chemicals, Inc.⁽²⁾	Chemicals	10.52%	L + 8.00%; 1.00% Floor	03/15/2025		26,220		25,775			25,696
ERC Finance, LLC^{(2) (3)}	Health Care Providers & Services	10.74%	L + 8.22%; 1.00% Floor	09/22/2025		19,800		19,404			19,404
Genesis Acquisition Co.^{(2) (3)}	Diversified Financial Services	10.02%	L + 7.50%	07/31/2025		7,000		6,832			6,808
Genesis Acquisition Co.^{(2) (3) (4) (6)}	Diversified Financial Services		L + 7.50%	07/31/2025		1,800		(21	)		(49	)
Hygiena Borrower LLC⁽³⁾	Life Sciences Tools & Services	10.55%	L + 7.75%; 1.00% Floor	08/26/2023		1,860		1,826			1,827
Hygiena Borrower LLC^{(3) (4)}	Life Sciences Tools & Services	10.55%	L + 7.75%; 1.00% Floor	08/26/2023		680		90			85
ICP Industrial, Inc.^{(2) (3)}	Chemicals	10.68%	L + 8.25%; 1.00% Floor	05/03/2024		20,400		19,960			19,941
IHS Intermediate Inc.⁽³⁾	Health Care Providers & Services	10.74%	L + 8.25%; 1.00% Floor	07/20/2022		10,000		9,880			9,350
Institutional Shareholder Services Inc.⁽²⁾	Diversified Financial Services	10.55%	L + 7.75%; 1.00% Floor	10/16/2025		5,100		5,077			4,998
Market Track, LLC^{(2) (3)}	Internet Catalog & Retail	10.18%	L + 7.75%; 1.00% Floor	06/05/2025		22,200		21,628			21,090
MPI Products LLC⁽³⁾	Auto Components	11.71%	L + 9.00%; 1.00% Floor	01/30/2020		20,000		19,924			19,700
National Spine and Pain Centers, LLC^{(2) (3)}	Health Care Providers & Services	10.77%	L + 8.25%; 1.00% Floor	12/02/2024		19,100		18,615			18,623
Odyssey Logistics & Technology Corporation⁽²⁾	Road & Rail	10.52%	L + 8.00%; 1.00% Floor	10/12/2025		18,722		18,339			18,207
P2 Upstream Acquisition Co.	Software	10.60%	L + 8.00%; 1.00% Floor	04/30/2021		3,500		3,486			3,325
SMB Shipping Logistics, LLC⁽²⁾	Air Freight & Logistics	10.86%	L + 8.00%; 1.00% Floor	02/03/2025		41,667		41,027			40,833
Spectrum Plastics Group, Inc.⁽²⁾	Containers & Packaging	9.52%	L + 7.00%; 1.00% Floor	01/31/2026		6,248		6,219			6,060
Viant Medical Holdings, Inc.⁽²⁾	Health Care Equipment & Supplies	10.55%	L + 7.75%	07/02/2026		8,260		8,181			8,012
YI, LLC^{(2) (3)}	Health Care Equipment & Supplies	10.55%	L + 7.75%; 1.00% Floor	11/07/2025		15,300		14,887			14,879
Zep Inc.⁽²⁾	Chemicals	11.05%	L + 8.25%; 1.00% Floor	08/11/2025		23,800		23,274			21,658

Total 2nd Lien/Senior Secured Debt								411,551			391,931

Unsecured Debt– 0.94%
CB-HDT Holdings, Inc.^{^ (3)}	Aerospace & Defense	12.00% PIK		12/15/2019		3,931		3,931			3,922
CB-HDT Holdings, Inc.^{^ (3)}	Aerospace & Defense	12.00% PIK		03/05/2021		1,716		1,716			1,711
Conergy Asia & ME Pte. LTD.^{^ (3) (7)}	Construction & Engineering	10.00%		05/26/2020		1,064		1,064			1,064

Total Unsecured Debt								6,711			6,697

Total Corporate Debt								1,270,892			1,235,111

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of December 31, 2018 (continued)

(in thousands, except share and per share amounts)



Portfolio Company	Industry	Coupon	Shares		Cost		Fair Value

Preferred Stock⁽¹⁾ – 3.03%
Accuity Delivery Systems, LLC^{^ (2) (3) (5) (10)}	Health Care Providers & Services			97,130	$	3,200	$	3,840
CB-HDT Holdings, Inc.^{^ (3) (5) (10)}	Aerospace & Defense			1,108,333		10,186		15,794
Conergy Asia Holdings, Ltd.^{^ (3) (5) (7) (10)}	Construction & Engineering			600,000		600		–
Kawa Solar Holdings Limited^{^ (3) (5) (7) (9)}	Construction & Engineering	8.00% PIK		58,430		778		–
NTS Communications, Inc.^{^ (3) (5) (10)}	Diversified Telecommunication Services			263		187		–
Wine.com, LLC^{(2) (5) (10)}	Beverages			221,072		1,900		1,900

Total Preferred Stock						16,851		21,534


Common Stock⁽¹⁾ – 3.15%
Bolttech Mannings, Inc.^{^^ (3) (5) (10)}	Commercial Services & Supplies			8,000		6,591		4,434
CB-HDT Holdings, Inc.^{^ (3) (5) (10)}	Aerospace & Defense			453,383		2,393		5,427
Collaborative Imaging Holdco, LLC – Class B^{^^^ (2) (3) (5)}	Health Care Providers & Services			8,464		1,141		1,330
Collaborative Imaging Holdco, LLC – Class C^{^^^ (2) (3) (5) (7) (10)}	Health Care Providers & Services			7,988		159		221
Conergy Asia Holdings, Ltd.^{^ (3) (5) (7) (10)}	Construction & Engineering			2,000		4,700		–
Continuum Managed Services LLC – Class A^{(2) (3) (5) (10)}	IT Services			733		732		842
Continuum Managed Services LLC – Class B^{(2) (3) (5) (10)}	IT Services			496,698		7		268
Elah Holdings, Inc.^{^ (2) (3) (5) (10)}	Capital Markets			46,214		2,234		2,234
Iracore International Holdings, Inc.^{^ (3) (5) (10)}	Energy Equipment & Services			28,898		7,003		4,418
Kawa Solar Holdings Limited^{^ (3) (5) (7) (10)}	Construction & Engineering			1,399,556		–		–
National Spine and Pain Centers, LLC^{(2) (3) (5) (10)}	Health Care Providers & Services			600		600		318
NTS Communications, Inc.^{^ (3) (5) (10)}	Diversified Telecommunication Services			595,215		3		–
Prairie Provident Resources, Inc.^{^^^ (7) (10)}	Oil, Gas & Consumable Fuels			3,579,988		9,237		504
Wrike, Inc.^{(2) (5) (10)}	Professional Services			348,478		2,165		2,165
Yasso, Inc.^{(2) (3) (5) (10)}	Food Products			850		850		182

Total Common Stock						37,815		22,343


Portfolio Company			LLC Interest		Cost		Fair Value

Investment Funds & Vehicles⁽¹⁾ – 13.59%
Senior Credit Fund, LLC^{^^ (7)}			$	100,000	$	100,000	$	96,456

Total Investment Funds & Vehicles						100,000		96,456

TOTAL INVESTMENTS – 193.75%					$	1,425,558	$	1,375,444

LIABILITIES IN EXCESS OF OTHER ASSETS – (93.75%)							$	(665,552	)

NET ASSETS – 100.00%							$	709,892

⁽⁺⁾

The Consolidated Schedule of Investments discloses the actual interest rate for partially or fully funded debt in effect as of the reporting date. Variable rate loans bear interest at a rate that may be determined by reference to either LIBOR (“L”) or alternate base rate (commonly based on the Prime Rate (“P”)), at the borrower’s option, which reset periodically based on the terms of the credit agreement. L loans are typically indexed to 12 month, 6 month, 3 month, 2 month, 1 month or 1 week L rates. As of December 31, 2018, rates for the 12 month, 6 month, 3 month, 2 month, 1 month and 1 week L are 3.01%, 2.88%, 2.81%, 2.61%, 2.50% and 2.41%, respectively. As of December 31, 2018, P was 5.50%. For investments with multiple reference rates or alternate base rates, the interest rate shown is the weighted average interest rate in effect at December 31, 2018.

⁽⁺⁺⁾

Par amount is denominated in U.S. Dollars (“$”) unless otherwise noted, Euro (“€”).

Percentages are based on net assets.

^{^}

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The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Consolidated Schedule of Investments as of December 31, 2018 (continued)

(in thousands, except share and per share amounts)

⁽¹⁾

Assets are pledged as collateral for the Revolving Credit Facility. See Note 6 “Debt”.

⁽²⁾

⁽³⁾

The fair value of the investment was determined using significant unobservable inputs. See Note 5 “Fair Value Measurement”.

⁽⁴⁾

⁽⁵⁾

Securities exempt from registration under the Securities Act, and may be deemed to be “restricted securities” under the Securities Act. As of December 31, 2018, the aggregate fair value of these securities is $78,879 or 11.11% of the Company’s net assets. The acquisition dates of the restricted securities are as follows:


Investment		Acquisition Date
Accuity Delivery Systems, LLC – Preferred Stock		06/13/2018
Artesyn Embedded Technologies, Inc. – 1st Lien/Senior Secured Debt		09/26/2013
Bolttech Mannings, Inc. – Common Stock		12/22/2017
CB-HDT Holdings, Inc. – Preferred Stock		07/01/2016
CB-HDT Holdings, Inc. – Common Stock		07/01/2016
Collaborative Imaging Holdco, LLC – Class B – Common Stock		03/30/2018
Collaborative Imaging Holdco, LLC – Class C – Common Stock		03/30/2018
Conergy Asia Holdings, Ltd. – Common Stock		07/31/2017
Conergy Asia Holdings, Ltd. – Preferred Stock		08/23/2017
Continuum Managed Services LLC – Class A – Common Stock		06/08/2017
Continuum Managed Services LLC – Class B – Common Stock		06/08/2017
Elah Holdings, Inc. – Common Stock		05/09/2018
Heligear Acquisition Co. – 1st Lien/Senior Secured Debt		09/30/2014
Iracore International Holdings, Inc. – Common Stock		04/13/2017
Kawa Solar Holdings Limited – Common Stock		08/17/2016
Kawa Solar Holdings Limited – Preferred Stock		10/25/2016
NTS Communications, Inc. – Preferred Stock		07/22/2016
NTS Communications, Inc. – Common Stock		07/22/2016
National Spine and Pain Centers, LLC – Common Stock		06/02/2017
Wine.com, LLC – Preferred Stock		11/14/2018
Wrike, Inc. – Common Stock		12/31/2018
Yasso, Inc. – Common Stock		03/23/2017

⁽⁶⁾

⁽⁷⁾

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, 2018 the aggregate fair value of these securities is $126,214 or 9.03% of the Company’s total assets.

⁽⁸⁾

The investment includes an exit fee that is receivable upon repayment of the loan. See Note 2 “Significant Accounting Policies”.

⁽⁹⁾

The investment is on non-accrual status as of December 31, 2018.

⁽¹⁰⁾

Non-income producing security.

⁽¹¹⁾

PIK – Payment-In-Kind

ADDITIONAL INFORMATION

Foreign currency forward contracts

Counterparty

Currency
Purchased

Currency
Sold

Settlement

Unrealized Appreciation
(Depreciation)

Bank of America, N.A.

USD 352

EUR 300

01/04/2019

Bank of America, N.A.

USD 288

EUR 245

02/05/2019

Bank of America, N.A.

USD 355

EUR 301

04/03/2019

Bank of America, N.A.

USD 309

EUR 260

05/06/2019

Bank of America, N.A.

USD 375

EUR 315

07/03/2019

Bank of America, N.A.

USD 311

EUR 260

08/05/2019

Bank of America, N.A.

USD 394

EUR 329

10/04/2019

Bank of America, N.A.

USD 324

EUR 269

11/05/2019

Bank of America, N.A.

USD 393

EUR 325

01/06/2020

Bank of America, N.A.

USD 399

EUR 327

04/06/2020

Bank of America, N.A.

USD 400

EUR 325

07/06/2020

Currency Abbreviations:

EUR – Euro

USD – U.S. Dollar

The accompanying notes are part of these unaudited consolidated financial statements.

Goldman Sachs BDC, Inc.

Notes to the Consolidated Financial Statements

(in thousands, except share and per share amounts)

(Unaudited)

1.	ORGANIZATION

Goldman Sachs BDC, Inc. (the “Company,” which term refers to either Goldman Sachs BDC, Inc. or Goldman Sachs BDC, Inc. together with its consolidated subsidiaries, as the context may require) was initially established as Goldman Sachs Liberty Harbor Capital, LLC, a single member Delaware limited liability company (“SMLLC”), on September 26, 2012 and commenced operations on November 15, 2012 with The Goldman Sachs Group, Inc. (“Group Inc.”) as its sole member. On March 29, 2013, the Company elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “Investment Company Act”). Effective April 1, 2013, the Company converted from a SMLLC to a Delaware corporation. In addition, the Company has elected to be treated as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its taxable year ended December 31, 2013.

The Company’s investment objective is to generate current income and, to a lesser extent, capital appreciation primarily through direct originations of secured debt, including first lien, unitranche, including last-out portions of such loans, and second lien debt, and unsecured debt, including mezzanine debt, as well as through select equity investments.

Goldman Sachs Asset Management, L.P. (“GSAM”), a Delaware limited partnership and an affiliate of Goldman Sachs & Co. LLC (including its predecessors, “GS & Co.”), is the investment adviser (the “Investment Adviser”) of the Company. The term “Goldman Sachs” refers to Group Inc., together with GS & Co., GSAM and its other subsidiaries.

On March 23, 2015, the Company completed its initial public offering (“IPO”) and the Company’s common stock began trading on the New York Stock Exchange (“NYSE”) under the symbol “GSBD”.

The Company has formed wholly owned subsidiaries, which are structured as Delaware limited liability companies, to hold certain equity or equity-like investments in portfolio companies.

2.	SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The Company’s functional currency is U.S. dollars (“USD”) and these consolidated financial statements have been prepared in that currency. The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to Regulation S-X. This requires the Company to make certain estimates and assumptions that may affect the amounts reported in the consolidated financial statements and accompanying notes. These consolidated financial statements reflect normal and recurring adjustments that in the opinion of the Company are necessary for the fair statement of the results for the periods presented. Actual results may differ from the estimates and assumptions included in the consolidated financial statements.

Certain financial information that is included in annual consolidated financial statements, including certain financial statement disclosures, prepared in accordance with GAAP, is not required for interim reporting purposes and has been condensed or omitted herein. These consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes related thereto for the year ended December 31, 2018, included in the Company’s Annual Report on Form 10-K, which was filed with the U.S. Securities and Exchange Commission (the “SEC”) on February 28, 2019. The results for the three months ended March 31, 2019 are not necessarily indicative of the results to be expected for the full fiscal year, any other interim period or any future year or period.

Certain prior period information has been reclassified to conform to the current period presentation. The reclassification has no effect on the Company’s consolidated financial position or the consolidated results of operations as previously reported.

As an investment company, the Company applies the accounting and reporting guidance in Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies (“ASC 946”) issued by the Financial Accounting Standards Board (“FASB”).

Basis of Consolidation

As provided under ASC 946, the Company will not consolidate its investment in a company other than an investment company subsidiary or a controlled operating company whose business consists of providing services to the Company. Accordingly, the Company consolidated the financial position and results of operations of its wholly owned subsidiaries, BDC Blocker I, LLC (formerly known as My-On BDC Blocker, LLC), GSBD Blocker II, LLC and GSBD Wine I, LLC. All significant intercompany transactions and balances have been eliminated in consolidation.

The Company does not consolidate its equity interest in Senior Credit Fund, LLC (the “Senior Credit Fund”). For further description of the Company’s investment in the Senior Credit Fund, see Note 4 “Investments”.

Revenue Recognition

The Company records its investment transactions on a trade date basis, which is the date when the Company assumes the risks for gains and losses related to that instrument. Realized gains and losses are based on the specific identification method.

Interest income, adjusted for amortization of premium and accretion of discount, is recorded on an accrual basis. Discounts and premiums to par value on investments purchased 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 (“OID”) and market discounts or premiums are capitalized and amortized into interest income using the effective interest method or straight-line method, as applicable. Exit fees that are receivable upon repayment of a loan or debt security are amortized into interest income over the life of the respective investment. Upon prepayment of a loan or debt security, any prepayment premiums, unamortized upfront loan origination fees and unamortized discounts are recorded as interest income. For the three months ended March 31, 2019 and 2018, the Company earned $646 and $476, respectively, in prepayment premiums and $1,037 and $833, respectively, in accelerated accretion of upfront loan origination fees and unamortized discounts.

Fees received from portfolio companies (directors’ fees, consulting fees, administrative fees, tax advisory fees and other similar compensation) are paid to the Company, unless, to the extent required by applicable law or exemptive relief, if any, therefrom, the Company only receives its allocable portion of such fees when invested in the same portfolio company as another account managed by the Investment Adviser.

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. Interest and dividend income are presented net of withholding tax, if any.

Certain investments may have contractual payment-in-kind (“PIK”) interest or dividends. PIK represents accrued interest or accumulated dividends that are added to the principal amount or shares (if equity) 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 the investment 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, respectively.

Certain structuring fees, amendment fees and syndication 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 over time.

Non-Accrual Investments

Investments are placed on non-accrual status when it is probable that principal, interest or dividends will not be collected according to the contractual terms. Accrued interest or dividends generally are reversed when an investment is placed on non-accrual status. Interest or dividend payments received on non-accrual investments may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual investments are restored to accrual status when past due principal and interest or dividends are paid and, in management’s judgment, principal and interest or dividend payments are likely to remain current. The Company may make exceptions to this treatment if an investment has sufficient collateral value and is in the process of collection. As of March 31, 2019, the Company had certain investments held in three portfolio companies on non-accrual status, which represented 4.5% and 3.5% of the total investments at amortized cost and at fair value, respectively. As of December 31, 2018, the Company had certain investments held in three portfolio companies on non-accrual status, which represented 8.3% and 7.0% of the total investments at amortized cost and at fair value, respectively.

Investments

The Company carries its investments in accordance with ASC Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), issued by the FASB, which defines fair value, establishes a framework for measuring fair value and requires disclosures about fair value measurements. Fair value is generally based on quoted market prices provided by independent pricing services, broker or dealer quotations or alternative price sources. In the absence of quoted market prices, broker or dealer quotations or alternative price sources, investments are measured at fair value as determined by the board of directors (the “Board of Directors”) within the meaning of the Investment Company Act.

Due to the inherent uncertainties of valuation, certain estimated fair values may differ significantly from the values that would have been realized had a ready market for these investments existed, and these differences could be material. See Note 5 “Fair Value Measurement”.

The Company generally invests in illiquid securities, including debt and equity investments, of middle-market companies. The Board of Directors has delegated to the Investment Adviser day-to-day responsibility for implementing and maintaining internal controls and procedures related to the valuation of the Company’s portfolio investments. Under valuation procedures adopted by the Board of Directors, market quotations are generally used to assess the value of the investments for which market quotations are readily available. The Investment Adviser obtains these market quotations from independent pricing services or at the bid prices obtained from at least two brokers or dealers, if available; otherwise from a principal market maker or a primary market dealer. To assess the continuing appropriateness of pricing sources and methodologies, the Investment Adviser regularly performs price verification procedures and issues challenges as necessary to independent pricing services or brokers, and any differences are reviewed in accordance with the valuation procedures. If the Board of Directors or Investment Adviser has a bona fide reason to believe any such market quotation does not reflect the fair value of an investment, it may independently value such investment in accordance with valuation procedures for investments for which market quotations are not readily available.

With respect to investments for which market quotations are not readily available, or for which market quotations are deemed not reflective of the fair value, the valuation procedures adopted by the Board of Directors contemplate a multi-step valuation process each quarter, as described below:

(1)

The quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals of the Investment Adviser responsible for the portfolio investment;

(2)

The Board of Directors also engages independent valuation firms (the “Independent Valuation Advisors”) to provide independent valuations of the investments for which market quotations are not readily available, or are readily available but deemed not reflective of the fair value of an investment. The Independent Valuation Advisors independently value such investments using quantitative and qualitative information provided by the investment professionals of the Investment Adviser and the portfolio companies as well as any market quotations obtained from independent pricing services, brokers, dealers or market dealers. The Independent Valuation Advisors also provide analyses to support their valuation methodology and calculations. The Independent Valuation Advisors provide an opinion on a final range of values on such investments to the Board of Directors or the Audit Committee. The Independent Valuation Advisors define fair value in accordance with ASC 820 and utilize valuation approaches including the market approach, the income approach or both. A portion of the portfolio is reviewed on a quarterly basis, and all investments in the portfolio for which market quotations are not readily available, or are readily available, but deemed not reflective of the fair value of an investment, are reviewed at least annually by an Independent Valuation Advisor;

(3)

The Independent Valuation Advisors’ preliminary valuations are reviewed by the Investment Adviser and the Valuation Oversight Group (“VOG”), a team that is part of the Controllers Department within the Finance Division of Goldman Sachs. The Independent Valuation Advisors’ valuation ranges are compared to the Investment Adviser’s valuations to ensure the Investment Adviser’s valuations are reasonable. VOG presents the valuations to the Private Investment Valuation and Side Pocket Working Group of the Investment Management Division Valuation Committee, which is comprised of representatives from GSAM who are independent of the investment decision making process;

(4)

The Investment Management Division Valuation Committee ratifies fair valuations and makes recommendations to the Audit Committee of the Board of Directors;

(5)

The Audit Committee of the Board of Directors reviews valuation information provided by the Investment Management Division Valuation Committee, the Investment Adviser and the Independent Valuation Advisors. The Audit Committee then assesses such valuation recommendations; and

(6)

The Board of Directors discusses the valuations and, within the meaning of the Investment Company Act, determines the fair value of the investments in good faith, based on the inputs of the Investment Adviser, the Independent Valuation Advisors and the Audit Committee.

Money Market Funds

Investments in money market funds are valued at net asset value (“NAV”) per share. See Note 3 “Significant Agreements and Related Party Transactions.”

Cash

Cash consists of deposits held at a custodian bank. As of March 31, 2019 and December 31, 2018, the Company held an aggregate cash balance of $5,891 and $6,113, respectively. Foreign currency of $368 and $257 (acquisition cost of $375 and $255) is included in cash as of March 31, 2019 and December 31, 2018, respectively.

Foreign Currency Translation

Amounts denominated in foreign currencies are translated into USD on the following basis: (i) investments and other assets and liabilities denominated in foreign currencies are translated into USD based upon currency exchange rates effective on the last business day of the period; and (ii) purchases and sales of investments, borrowings and repayments of such borrowings, income, and expenses denominated in foreign currencies are translated into USD based upon currency exchange rates prevailing on the transaction dates.

The Company does not isolate the portion of the results of operations resulting from changes in foreign exchange rates on investments from fluctuations arising from changes in market prices of securities held. Such fluctuations are included within the net realized and unrealized gains or losses on investments. Fluctuations arising from the translation of non-investment assets and liabilities are included with the net change in unrealized gains (losses) on foreign currency translations on the Consolidated Statements of Operations.

Foreign security and currency translations may involve certain considerations and risks not typically associated with investing in U.S. companies and U.S. government securities. These risks include, but are not limited to, currency fluctuations and revaluations and future adverse political, social and economic developments, which could cause investments in foreign markets to be less liquid and prices more volatile than those of comparable U.S. companies or U.S. government securities.

Derivatives

Foreign currency forward contracts

The Company may enter into foreign currency forward contracts to reduce the Company’s exposure to foreign currency exchange rate fluctuations in the value of foreign currencies. In a foreign currency forward contract, the Company agrees to receive or deliver a fixed quantity of one currency for another, at a pre-determined price at a future date. Forward foreign currency contracts are marked-to-market at the applicable forward rate. Unrealized appreciation (depreciation) on foreign currency forward 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. Notional amounts of foreign currency forward contract assets and liabilities are presented separately on the Consolidated Schedules of Investments. Purchases and settlements of foreign currency forward contracts having the same settlement date and counterparty are generally settled net and any realized gains or losses are recognized on the settlement date.

The Company does not utilize hedge accounting and as such, the Company recognizes its derivatives at fair value with changes in the net unrealized appreciation (depreciation) on foreign currency forward contracts recorded on the Consolidated Statements of Operations.

Income Taxes

The Company recognizes tax positions in its consolidated financial statements only when it is more likely than not that the position will be sustained upon examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit that will more likely than not be realized upon settlement. The Company reports any interest expense related to income tax matters in income tax expense, and any income tax penalties under expenses in the Consolidated Statements of Operations.

The Company’s tax positions have been reviewed based on applicable statutes of limitation for tax assessments, which may vary by jurisdiction, and based on such review, the Company has concluded that no additional provision for income tax is required in the consolidated financial statements. The Company is subject to potential examination by certain taxing authorities in various jurisdictions. The Company’s tax positions are subject to ongoing interpretation of laws and regulations by taxing authorities.

The Company has elected to be treated as a RIC commencing with its taxable year ended December 31, 2013. So long as the Company maintains its status as a RIC, it will generally not be required to pay corporate-level U.S. federal income tax on any ordinary income or capital gains that it distributes at least annually to its stockholders as dividends. As a result, any U.S. federal income 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.

To maintain its tax treatment as a RIC, the Company must meet specified source-of-income and asset diversification requirements and timely distribute to its stockholders for each taxable year at least 90% of its investment company taxable income (generally, its net ordinary income plus the excess of its realized net short-term capital gains over realized net long-term capital losses, determined without regard to the dividends paid deduction). In order for the Company not to be subject to U.S. federal excise taxes, it must distribute annually an amount at least equal to the sum of (i) 98% of its net ordinary income (taking into account certain deferrals and elections) for the calendar year, (ii) 98.2% of its capital gains in excess of capital losses for the one-year period ending on October 31 of the calendar year and (iii) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years. The Company, at its discretion, may carry forward taxable income in excess of calendar year dividends and pay a 4% nondeductible U.S. federal excise tax on this income. If the Company chooses to do so, this generally would increase expenses and reduce the amount available to be distributed to stockholders. The Company will accrue excise tax on estimated undistributed taxable income as required. For the three months ended March 31, 2019 and 2018 the Company accrued excise taxes of $442 and $285, respectively. As of March 31, 2019, $625 of accrued excise taxes remained payable.

Certain of the Company’s consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes. Income tax expense, if any, is included under the income category for which it applies in the Consolidated Statements of Operations. For the three months ended March 31, 2019 and 2018 the Company accrued provision for taxes on realized gains on investments of $0 and $447, respectively. For the three months ended March 31, 2019 and 2018 the Company accrued provision for taxes on unrealized gains on investments of $(204) and $0, respectively. As of March 31, 2019, $518 of income taxes remained payable.

Distributions

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 GAAP. The Company may pay distributions in excess of its taxable net investment income. This excess would be a tax-free return of capital in the period and 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. These differences are generally determined in conjunction with the preparation of the Company’s annual RIC tax return. Distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid out as a distribution is determined by the Board of Directors each quarter and is generally based upon the earnings estimated by the Investment Adviser. 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. 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 carry forward taxable income for distribution in the following year and pay any applicable tax. The specific tax characteristics of the Company’s distributions will be reported to stockholders after the end of the calendar year. All distributions will be subject to available funds, and no assurance can be given that the Company will be able to declare such distributions in future periods.

The Company has adopted a dividend reinvestment plan that provides for reinvestment of all cash distributions declared by the Board of Directors unless a stockholder elects to “opt out” of the plan. As a result, if the Board of Directors declares a cash distribution, then the stockholders who have not “opted out” of the dividend reinvestment plan will have their cash distributions automatically reinvested in additional shares of common stock, rather than receiving the cash distribution. Stockholders who receive distributions in the form of shares of common stock will generally be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions and, for this purpose, stockholders receiving distributions in the form of stock will generally be treated as receiving distributions equal to the fair market value of the stock received through the plan; however, since their cash distributions will be reinvested, those stockholders will not receive cash with which to pay any applicable taxes. Due to regulatory considerations, Group Inc. has opted out of the dividend reinvestment plan, and GS & Co. has opted out of the dividend reinvestment plan in respect of shares of the Company’s common stock acquired through its 10b5-1 plan.

Deferred Financing and Debt Issuance Costs

Deferred financing and debt issuance costs consist of fees and expenses paid in connection with the closing of and amendments to the Company’s senior secured revolving credit agreement (as amended, the “Revolving Credit Facility”) with SunTrust Bank, as administrative agent, and Bank of America, N.A., as syndication agent, and the offering of the Company’s 4.50% Convertible Notes due 2022 (the “Convertible Notes”). These costs are amortized using the straight-line method over the respective term of the Revolving Credit Facility and Convertible Notes. Deferred financing costs related to the Revolving Credit Facility are presented separately as an asset on the Company’s Consolidated Statements of Assets and Liabilities. Deferred debt issuance costs related to the Convertible Notes are presented net against the outstanding debt balance on the Consolidated Statements of Assets and Liabilities.

Deferred Offering Costs

The Company records expenses related to registration statement filings and applicable offering costs as deferred offering costs. To the extent such expenses relate to equity offerings, these expenses are charged as a reduction of paid-in-capital upon each such offering.

New Accounting Pronouncements

In October 2018, the U.S Securities Exchange Commission (“SEC”) adopted the final rule under SEC release No. 33-10532, Disclosure Update and Simplification, amending certain disclosure requirements that were redundant, duplicative, overlapping, outdated or superseded. The Company is no longer required to present components of distributable earnings on the Consolidated Statements of Assets and Liabilities or the sources of distributable earnings and the amount of undistributed net investment income on the Consolidated Statements of Changes in Net Assets. Prior period information has been reclassified to conform to the current period presentation and this had no effect on the Company’s consolidated financial position or the consolidated results of operations as previously reported. The following provides the prior period reclassifications.

Consolidated Statements of Changes in Net Assets – The table below provides a reconciliation for previously disclosed distributions from net investment income and realized gain for the three months ended March 31, 2018 to distributions from distributable earnings as disclosed in the current filing.


Distributions to stockholders from:	For the three months ended March 31, 2018
Net investment income	$	(18,070	)
Total distributions to stockholders	$	(18,070	)

3.	SIGNIFICANT AGREEMENTS AND RELATED PARTY TRANSACTIONS

Investment Management Agreement

The Company has entered into an investment management agreement (as amended and restated as of June 15, 2018, the “Investment Management Agreement”) with the Investment Adviser, pursuant to which the Investment Adviser manages the Company’s investment program and related activities.

Management Fee

The Company pays the Investment Adviser a management fee (the “Management Fee”), accrued and payable quarterly in arrears. The Management Fee is calculated at (i) an annual rate of 1.50% (0.375% per quarter) (the “Original Rate”) through June 14, 2018 and (ii) an annual rate of 1.00% (0.25% per quarter) (the “New Rate”) thereafter, in each case, of the average value of the Company’s gross assets (excluding cash or cash equivalents but including assets purchased with borrowed amounts) at the end of each of the two most recently completed calendar quarters. The Management Fee for any partial quarter (including any quarter during which both the Original Rate and the New Rate were in effect) will be appropriately prorated based on the actual number of days elapsed relative to the total number of days in such calendar quarter.

For the three months ended March 31, 2019 and 2018 Management Fees amounted to $3,536 and $4,803, respectively. As of March 31, 2019, $3,536 remained payable.

Incentive Fee

The incentive fee (the “Incentive Fee”) consists of two components that are determined independent of each other, with the result that one component may be payable even if the other is not. Effective as of January 1, 2015, the Incentive Fee is calculated as follows:

A portion of the Incentive Fee is based on income and a portion is based on capital gains, each as described below. The Investment Adviser is entitled to receive the Incentive Fee based on income if Ordinary Income (as defined below) exceeds a quarterly “hurdle rate” of 1.75%. For this purpose, the hurdle is computed by reference to the Company’s NAV and does not take into account changes in the market price of the Company’s common stock.

The Incentive Fee based on income is determined and paid quarterly in arrears at the end of each calendar quarter by reference to the Company’s aggregate net investment income, as adjusted as described below, from the calendar quarter then ending and the eleven preceding calendar quarters (or if shorter, the number of quarters that have occurred since January 1, 2015) (such period the “Trailing Twelve Quarters”). The Incentive Fee based on capital gains is determined and paid annually in arrears at the end of each calendar year by reference to an “Annual Period,” which means the period beginning on January 1 of each calendar year and ending on December 31 of such calendar year or, in the case of the first and last year, the appropriate portion thereof.

The hurdle amount for the Incentive Fee based on income is determined on a quarterly basis and is equal to 1.75% multiplied by the Company’s NAV at the beginning of each applicable calendar quarter comprising the relevant Trailing Twelve Quarters. The hurdle amount is calculated after making appropriate adjustments for subscriptions (which includes all of the Company’s issuances of shares of its common stock, including issuances pursuant to its dividend reinvestment plan) and distributions that occurred during the relevant Trailing Twelve Quarters. The Incentive Fee for any partial period will be appropriately prorated.

i. Quarterly Incentive Fee Based on Income

For the portion of the Incentive Fee based on income, the Company pays the Investment Adviser a quarterly Incentive Fee based on the amount by which (A) aggregate net investment income (“Ordinary Income”) in respect of the relevant Trailing Twelve Quarters exceeds (B) the hurdle amount for such Trailing Twelve Quarters. The amount of the excess of (A) over (B) described in this paragraph for such Trailing Twelve Quarters is referred to as the “Excess Income Amount”. Ordinary Income is net of all fees and expenses, including the Management Fee but excluding any Incentive Fee.

The Incentive Fee based on income for each quarter is determined as follows:

•

No Incentive Fee based on income is payable to the Investment Adviser for any calendar quarter for which there is no Excess Income Amount;

•

100% of the Ordinary Income, if any, that exceeds the hurdle amount, but is less than or equal to an amount, referred to as the “Catch-up Amount,” determined as the sum of 2.1875% multiplied by the Company’s NAV at the beginning of each applicable calendar quarter comprising the relevant Trailing Twelve Quarters is included in the calculation of the Incentive Fee based on income; and

•

20% of the Ordinary Income that exceeds the Catch-up Amount is included in the calculation of the Incentive Fee based on income.

The amount of the Incentive Fee based on income that is paid to the Investment Adviser for a particular quarter equals the excess of the Incentive Fee so calculated minus the aggregate Incentive Fees based on income that were paid in respect of the first eleven calendar quarters (or the portion thereof) included in the relevant Trailing Twelve Quarters but not in excess of the Incentive Fee Cap (as described below).

The Incentive Fee based on income that is paid to the Investment Adviser for a particular quarter is subject to a cap (the “Incentive Fee Cap”). The Incentive Fee Cap for any quarter is an amount equal to (a) 20% of the Cumulative Net Return (as defined below) during the relevant Trailing Twelve Quarters minus (b) the aggregate Incentive Fees based on income that were paid in respect of the first eleven calendar quarters (or the portion thereof) included in the relevant Trailing Twelve Quarters.

“Cumulative Net Return” means (x) the Ordinary Income in respect of the relevant Trailing Twelve Quarters minus (y) any Net Capital Loss, if any, in respect of the relevant Trailing Twelve Quarters. If, in any quarter, the Incentive Fee Cap is zero or a negative value, the Company pays no Incentive Fee based on income to the Investment Adviser for such quarter. If, in any quarter, the Incentive Fee Cap for such quarter is a positive value but is less than the Incentive Fee based on income that is payable to the Investment Adviser for such quarter (before giving effect to the Incentive Fee Cap) calculated as described above, the Company pays an Incentive Fee based on income to the Investment Adviser equal to the Incentive Fee Cap for such quarter. If, in any quarter, the Incentive Fee Cap for such quarter is equal to or greater than the Incentive Fee based on income that is payable to the Investment Adviser for such quarter (before giving effect to the Incentive Fee Cap) calculated as described above, the Company pays an Incentive Fee based on income to the Investment Adviser equal to the Incentive Fee calculated as described above for such quarter without regard to the Incentive Fee Cap.

“Net Capital Loss” in respect of a particular period means the difference, if positive, between (i) aggregate capital losses, whether realized or unrealized, in such period and (ii) aggregate capital gains, whether realized or unrealized, in such period.

ii. Annual Incentive Fee Based on Capital Gains.

The portion of the Incentive Fee based on capital gains is calculated on an annual basis. For each Annual Period, the Company pays the Investment Adviser an amount equal to (A) 20% of the difference, if positive, of the sum of the Company’s aggregate realized capital gains, if any, computed net of the Company’s aggregate realized capital losses, if any, and the Company’s aggregate unrealized capital depreciation, in each case from April 1, 2013 until the end of such Annual Period minus (B) the cumulative amount of Incentive Fees based on capital gains previously paid to the Investment Adviser from April 1, 2013. For the avoidance of doubt, unrealized capital appreciation is excluded from the calculation in clause (A) above.

The Company accrues, but does not pay, a portion of the Incentive Fee based on capital gains with respect to net unrealized appreciation. Under GAAP, the Company is required to accrue an Incentive Fee based on capital gains that includes net realized capital gains and losses and net unrealized capital appreciation and depreciation on investments held at the end of each period. In calculating the accrual for the Incentive Fee based on capital gains, the Company considers the cumulative aggregate unrealized capital appreciation in the calculation, since an Incentive Fee based on capital gains 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 payable under the Investment Management Agreement. This accrual is calculated using the aggregate cumulative realized capital gains and losses and aggregate cumulative unrealized capital appreciation or depreciation. If such amount is positive at the end of a period, then the Company records a capital gains incentive fee equal to 20% of such amount, minus the aggregate amount of actual Incentive Fees based on capital gains paid in all prior periods. If such amount is negative, then there is no accrual for such period. There can be no assurance that such unrealized capital appreciation will be realized in the future.

For the three months ended March 31, 2019 and 2018, the Company incurred Incentive Fees based on income of $493 and $4,684, respectively. As of March 31, 2019, $493 remained payable. For the three months ended March 31, 2019 and 2018, the Company did not accrue or pay any Incentive Fees based on capital gains.

Administration and Custodian Fees

The Company has entered into an administration agreement with State Street Bank and Trust Company (the “Administrator”) under which the Administrator provides various accounting and administrative services to the Company. The Company pays the Administrator fees for its services as it determines to be commercially reasonable in its sole discretion. The Company also reimburses the Administrator for all reasonable expenses. To the extent that the Administrator outsources any of its functions, the Administrator pays any compensation associated with such functions. The Administrator also serves as the Company’s custodian (the “Custodian”).

For the three months ended March 31, 2019 and 2018, the Company incurred expenses for services provided by the Administrator and the Custodian of $237 and $227, respectively. As of March 31, 2019, $234 remained payable.

Transfer Agent Fees

Effective May 2, 2016, the Company entered into a transfer agency and services agreement pursuant to which Computershare Trust Company, N.A. serves as the Company’s transfer agent (the “Transfer Agent”), dividend agent and registrar. From the IPO to May 1, 2016, State Street Bank and Trust Company served as the Transfer Agent and dividend agent. Prior to the IPO, GS & Co. was the Transfer Agent. For the three months ended March 31, 2019 and 2018, the Company incurred expenses for services provided by the Transfer Agent of $3 and $4, respectively. As of March 31, 2019, $3 remained payable.

Common Stock Repurchase Plans

In February 2016, the Board of Directors authorized the Company to repurchase up to $25,000 of the Company’s common stock if the stock trades below the most recently announced NAV per share (including any updates, corrections or adjustments publicly announced by the Company to any previously announced NAV per share), from March 18, 2016 to March 18, 2017, subject to certain limitations. In February 2017, the Company’s Board of Directors renewed its authorization of the stock repurchase plan to extend the expiration to March 18, 2018, in February 2018, again renewed its authorization of the stock repurchase plan to extend the expiration to March 18, 2019 and, in February 2019, again renewed its authorization of the stock repurchase plan to extend the expiration to March 18, 2020.

In connection with this authorization, the Company entered into a 10b5-1 plan (the “Company 10b5-1 Plan”). The Company 10b5-1 Plan initially took effect on March 18, 2016 (with any purchases to commence after the opening of NYSE trading on March 21, 2016), was subsequently renewed and expired on March 18, 2018. The Company entered into an agreement to renew the Company 10b5-1 Plan on May 14, 2018, which was terminated on June 27, 2018 in connection with the Company’s offering of Convertible Notes. See Notes 6 “Debt”. On June 27, 2018, the Company entered into an agreement to renew the Company 10b5-1 Plan with any purchases pursuant to the agreement to commence on September 25, 2018. The Company 10b5-1 Plan expired on March 18, 2019.

In February 2019, our Board of Directors approved a new common stock repurchase plan (the “New Company 10b5-1 Plan”), which provides for us to repurchase up to $25,000 of shares of our common stock if the stock trades below the most recently announced net asset value per share, subject to limitations. Under the New Company 10b5-1 Plan, no purchases will be made if such purchases would (i) cause the aggregate ownership of our outstanding stock by Group Inc. and GS & Co. to equal or exceed 25.0% (due to the reduction in outstanding shares of stock as a result of purchase) or (ii) cause our Debt/Equity Ratio to exceed the lower of (a) 1.40 or (b) the Maximum Debt/Equity Ratio. In the New Company 10b5-1 Plan, “Debt/Equity Ratio” means the sum of debt on the Consolidated Statements of Assets and Liabilities and the total notional value of the Purchaser’s unfunded commitments divided by 85% of total equity, as of the most recent reported financial statement end date, and “Maximum Debt/Equity Ratio” means the sum of debt on the balance sheet and committed uncalled debt divided by net assets, as of the most recent reported financial statement end date. The New Company 10b5-1 Plan took effect on March 18, 2019, expires on March 18, 2020 and purchases thereunder will be conducted on a programmatic basis in accordance with Rules 10b5-1 and 10b-18 under the Exchange Act and other applicable securities laws.

The Company’s repurchase of its common stock under the New Company 10b5-1 Plan or otherwise may result in the price of the Company’s common stock being higher than the price that otherwise might exist in the open market. For the three months ended March 31, 2019 and 2018, the Company did not repurchase any of its common stock pursuant to the Company 10b5-1 Plan, the New Company 10b5-1 Plan or otherwise.

Affiliates

As of March 31, 2019 and December 31, 2018, Group Inc. owned 16.10% and 16.12%, respectively, of the outstanding shares of the Company’s common stock.

The Company’s investments in affiliates for the three months ended March 31, 2019 were as follows:


	Fair Value as of December 31, 2018		Gross Additions⁽³⁾		Gross Reductions⁽⁴⁾			Net Realized Gains/(Losses)		Change in Unrealized Gains/(Losses)			Fair Value as of March 31, 2019		Dividend, Interest, PIK and Other Income
Controlled Affiliates

Animal Supply Holdings LLC	$	–	$	54,230	$	–		$	–	$	6		$	54,236	$	–
Bolttech Mannings, Inc.		23,863		532		–			–		(375	)		24,020		535
Senior Credit Fund, LLC⁽¹⁾		96,456		–		–			–		(525	)		95,931		2,450
Total Controlled Affiliates	$	120,319	$	54,762	$	–		$	–	$	(894	)	$	174,187	$	2,985
Non-Controlled Affiliates
Goldman Sachs Financial Square Government Fund ⁽²⁾	$	–	$	62,408	$	(62,408	)	$	–	$	–		$	–	$	18
Accuity Delivery Systems, LLC		13,730		12		–			–		385			14,127		263
CB-HDT Holdings, Inc.		26,854		–		(1	)		–		(3,448	)		23,405		167
Collaborative Imaging Holdco, LLC		10,273		4		–			–		(92	)		10,185		224
Conergy Asia Holdings, Ltd		1,064		–		–			–		–			1,064		26
Elah Holdings, Inc.		2,234		–		–			–		–			2,234		–
Iracore International Holdings, Ltd		7,807		–		–			–		365			8,172		98
Kawa Solar Holdings Limited		8,066		–		(4,547	)		–		320			3,839		–
NTS Communications, Inc.		55,557		228		–			–		(238	)		55,547		234
Prairie Provident Resources, Inc.		504		–		–			–		(48	)		456		–
Total Non-Controlled Affiliates	$	126,089	$	62,652	$	(66,956	)	$	–	$	(2,756	)	$	119,029	$	1,030
Total Affiliates	$	246,408	$	117,414	$	(66,956	)	$	–	$	(3,650	)	$	293,216	$	4,015

⁽¹⁾

Together with The Regents of the University of California (“Cal Regents”, and collectively with the Company, the “Members”), the Company invests through the Senior Credit Fund. Although the Company owns more than 25% of the voting securities of the Senior Credit Fund, the Company does not believe that it has control over the Senior Credit Fund (other than for purposes of the Investment Company Act). See Note 4 “Investments”.

⁽²⁾	Fund advised by an affiliate of Goldman Sachs.

⁽³⁾

Gross additions may include increases in the cost basis of investments resulting from new portfolio investments, PIK interest or dividends, the accretion of discounts, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.

⁽⁴⁾

Gross reductions may include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company out of this category into a different category.

The Company’s investments in affiliates for the year ended December 31, 2018 were as follows:


	Fair Value as of December 31, 2017		Gross Additions⁽³⁾		Gross Reductions⁽⁴⁾			Net Realized Gains/(Losses)		Change in Unrealized Gains/(Losses)			Fair Value as of December 31, 2018		Dividend, Interest, PIK and Other Income
Controlled Affiliates

Bolttech Mannings, Inc.	$	20,569	$	5,648	$	–		$	–	$	(2,354	)	$	23,863	$	1,791
Senior Credit Fund, LLC⁽¹⁾		92,097		5,658		–			–		(1,299	)		96,456		10,550
Total Controlled Affiliates	$	112,666	$	11,306	$	–		$	–	$	(3,653	)	$	120,319	$	12,341
Non-Controlled Affiliates
Goldman Sachs Financial Square Government Fund⁽²⁾	$	11,539	$	243,137	$	(254,676	)	$	–	$	–		$	–	$	53
Accuity Delivery Systems, LLC		–		13,092		–			–		638			13,730		568
CB-HDT Holdings, Inc.		19,345		2,148		–			–		5,361			26,854		589
Collaborative Imaging Holdco, LLC		–		10,077		–			–		196			10,273		703
Conergy Asia Holdings, Ltd		4,832		664		–			–		(4,432	)		1,064		68
Elah Holdings, Inc.		–		2,234		–			–		–			2,234		–
Iracore International Holdings, Ltd		9,602		–		–			–		(1,795	)		7,807		380
Kawa Solar Holdings Limited		8,918		153		(664	)		9		(350	)		8,066		151
NTS Communications, Inc.		51,538		6,459		–			–		(2,440	)		55,557		6,453
Prairie Provident Resources, Inc.		1,233		–		–			–		(729	)		504		–
Total Non-Controlled Affiliates	$	107,007	$	277,964	$	(255,340	)	$	9	$	(3,551	)	$	126,089	$	8,965
Total Affiliates	$	219,673	$	289,270	$	(255,340	)	$	9	$	(7,204	)	$	246,408	$	21,306

⁽¹⁾

Together with Cal Regents, the Company invests through the Senior Credit Fund. Although the Company owns more than 25% of the voting securities of the Senior Credit Fund, the Company does not believe that it has control over the Senior Credit Fund (other than for purposes of the Investment Company Act). See Note 4 “Investments”.

⁽²⁾

Fund advised by an affiliate of Goldman Sachs.

⁽³⁾

⁽⁴⁾

Due to Affiliates

The Investment Adviser pays certain general and administrative expenses, including legal expenses, on behalf of the Company in the ordinary course of business. As of March 31, 2019 and December 31, 2018, there were $570 and $282, respectively, included within Accrued expenses and other liabilities paid by the Investment Adviser and its affiliates on behalf of the Company.

Co-investment Activity

In certain circumstances, negotiated co-investments by the Company and other funds managed by the Investment Adviser may be made only pursuant to an order from the SEC permitting the Company to do so. On January 4, 2017, the Company and GSAM, Goldman Sachs Private Middle Market Credit LLC (“GS PMMC”) and Goldman Sachs Middle Market Lending Corp. (“GS MMLC”) received exemptive relief (“Exemptive Relief”) that permits the Company to co-invest with GS PMMC, GS MMLC and certain other funds that may be managed by GSAM, including the GSAM Credit Alternatives Team, after the date of the exemptive order, subject to certain conditions including that co-investments are made in a manner consistent with the Company’s investment objectives, positions, policies, strategies and restrictions, as well as regulatory requirements and pursuant to the conditions required by the Exemptive Relief, and are allocated fairly among participants. The GSAM Credit Alternatives Team is comprised of investment professionals dedicated to the Company’s investment strategy and other funds that share a similar investment strategy with the Company, who are responsible for identifying investment opportunities, conducting research and due diligence on prospective investments, negotiating and structuring the Company’s investments and monitoring and servicing the Company’s investments, together with investment professionals who are primarily focused on investment strategies in syndicated, liquid credit. Under the terms of the Exemptive Relief, a “required majority” (as defined in Section 57(o) of the Investment Company Act) of the Company’s independent directors must make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the proposed transaction are reasonable and fair to the Company and the Company’s stockholders and do not involve overreaching in respect of the Company or its stockholders on the part of any person concerned, and (2) the transaction is consistent with the interests of the Company’s stockholders and is consistent with the then-current investment objectives and strategies of the Company. As a result of the Exemptive Relief, there could be significant overlap in the Company’s investment portfolio and the investment portfolios of GS PMMC, GS MMLC and/or other funds established by the GSAM Credit Alternatives Team that could avail themselves of the Exemptive Relief.

4.	INVESTMENTS

As of the dates indicated, the Company’s investments consisted of the following:


	March 31, 2019				December 31, 2018
Investment Type	Cost		Fair Value		Cost		Fair Value
1st Lien/Senior Secured Debt	$	823,300	$	814,544	$	738,626	$	729,604
1st Lien/Last-Out Unitranche		108,355		101,087		114,004		106,879
2nd Lien/Senior Secured Debt		304,393		291,034		411,551		391,931
Unsecured Debt		6,711		6,701		6,711		6,697
Preferred Stock		41,850		44,865		16,851		21,534
Common Stock		67,046		50,935		37,815		22,343
Investment Funds & Vehicles⁽¹⁾		100,000		95,931		100,000		96,456
Total Investments	$	1,451,655	$	1,405,097	$	1,425,558	$	1,375,444

⁽¹⁾

Includes equity investments in the Senior Credit Fund.

As of the dates indicated, the industry composition of the Company’s portfolio at fair value and net assets was as follows:


	March 31, 2019						December 31, 2018
Industry	Fair Value			Net Assets			Fair Value			Net Assets
Software		9.8	%		19.9	%		11.5	%		22.3	%
Health Care Providers & Services		8.2			16.5			8.0			15.5
IT Services		7.0			14.1			4.8			9.4
Investment Funds & Vehicles		6.8			13.8			7.0			13.6
Distributors		6.3			12.8			5.8			11.2
Internet Software & Services		6.0			12.1			5.2			10.0
Diversified Telecommunication Services		5.5			11.1			5.6			10.9
Media		5.4			11.0			5.5			10.7
Chemicals		4.7			9.6			4.9			9.5
Health Care Equipment & Supplies		4.2			8.5			4.3			8.2
Electronic Equipment, Instruments & Components		3.9			7.8			4.0			7.6
Air Freight & Logistics		2.9			5.9			3.0			5.8
Aerospace & Defense		2.9			5.8			3.2			6.2
Professional Services		2.8			5.7			3.0			5.7
Diversified Financial Services		2.7			5.4			3.1			6.1
Road & Rail		2.2			4.4			2.2			4.3
Machinery		2.1			4.3			2.2			4.2
Specialty Retail		2.1			4.2			2.1			4.1
Health Care Technology		2.1			4.2			1.6			3.1
Commercial Services & Supplies		2.0			4.1			2.0			3.8
Auto Components		1.9			3.9			2.0			3.8
Household Products		1.8			3.6			1.8			3.6
Internet Catalog & Retail		1.8			3.6			1.5			3.0
Real Estate Management & Development		1.0			1.9			0.9			1.8
Leisure Equipment & Products		0.8			1.6			0.8			1.5
Food Products		0.6			1.3			1.1			2.2
Energy Equipment & Services		0.6			1.2			0.6			1.1
Beverages		0.6			1.2			0.6			1.2
Containers & Packaging		0.4			0.9			0.4			0.9
Life Sciences Tools & Services		0.4			0.8			0.4			0.8
Construction & Engineering		0.3			0.7			0.7			1.3
Capital Markets		0.2			0.3			0.2			0.3
Oil, Gas & Consumable Fuels		0.0			0.1			0.0			0.1
Total		100.0	%		202.3	%		100.0	%		193.8	%

As of the dates indicated, the geographic composition of the Company’s portfolio at fair value was as follows:


Geographic	March 31, 2019			December 31, 2018
United States		98.2	%		97.9	%
Ireland		1.4			1.4
Germany		0.3			0.6
Singapore		0.1			0.1
Total		100.0	%		100.0	%

Senior Credit Fund, LLC

The Senior Credit Fund, an unconsolidated Delaware limited liability company, was formed on May 7, 2014 and commenced operations on October 1, 2014. The Company invests together with Cal Regents through the Senior Credit Fund. The Senior Credit Fund’s principal purpose is to make investments, either directly or indirectly through its wholly owned subsidiary, Senior Credit Fund SPV I, LLC (“SPV I”), primarily in senior secured loans to middle-market companies. Each of the Company and Cal Regents are responsible for sourcing the Senior Credit Fund’s investments. Each of the Company and Cal Regents has a 50% economic ownership in the Senior Credit Fund and each has subscribed to fund $100,000. Except under certain circumstances, contributions to the Senior Credit Fund cannot be redeemed. The Senior Credit Fund is managed by a six member board of managers, on which the Company and Cal Regents have equal representation. Investment decisions generally must be unanimously approved by a quorum of the board of managers. On August 24, 2018, the Company and Cal Regents, as the Members of the Senior Credit Fund, entered into an amendment to the amended and restated limited liability company agreement of the Senior Credit Fund to extend the investment period to December 19, 2018.

On February 27, 2019, the board of managers of the Senior Credit Fund authorized the liquidation and subsequent dissolution of the Senior Credit Fund and the pro-rata distribution of its assets and liabilities to the members of the Senior Credit Fund. Following the distribution of underlying assets and liabilities held by the Senior Credit Fund to its members, including the Company, the pro-rata portion of such assets and liabilities received by the Company will become assets and liabilities of the Company and will be directly included in its consolidated financial statements and notes thereto, and will also be included for purposes of determining the Company’s asset coverage ratio. There can be no assurance that the liquidation of the Senior Credit Fund and related transactions will be effectuated, and such transactions will remain subject to any requisite approvals.

On December 19, 2016, SPV I entered into an amended and restated credit facility (as amended, the “Asset Based Facility”), which consists of a revolving credit facility (the “SPV I Revolving Credit Facility”), a term loan facility (the “SPV I Term Loan Facility”) and a Class B loan facility (the “SPV I Class B Facility”), with various lenders. For the Asset Based Facility, Natixis, New York Branch (“Natixis”) serves as the facility agent, and State Street Bank and Trust Company serves as the collateral agent. The SPV I Revolving Credit Facility provided for borrowings in an aggregate amount of $19,550 as of March 31, 2019. Borrowings under the SPV I Revolving Credit Facility bear interest at LIBOR plus 2.30%. As of March 31, 2019, the SPV I Term Loan Facility consisted of a $228,873 term loan and the SPV I Class B Facility consisted of a $40,000 Class B loan. Borrowings under the SPV I Term Loan Facility and SPV I Class B Facility bear interest at LIBOR plus 2.30% and LIBOR plus 3.50%, respectively. Any amounts borrowed under the Asset Based Facility will mature, and all accrued and unpaid interest will be due and payable, on December 19, 2025. As of March 31, 2019 and December 31, 2018, the SPV I’s aggregated outstanding borrowings under the Asset Based Facility were $288,423 and $300,500, respectively.

As of March 31, 2019 and December 31, 2018, the Company and Cal Regents had subscribed to fund and contributed the following to the Senior Credit Fund:


	March 31, 2019				December 31, 2018
Member	Subscribed to fund		Contributed		Subscribed to fund		Contributed
Company	$	100,000	$	100,000	$	100,000	$	100,000
Cal Regents		100,000		100,000		100,000		100,000
Total	$	200,000	$	200,000	$	200,000	$	200,000

As of March 31, 2019 and December 31, 2018, the Senior Credit Fund had total investments at fair value of $431,455 and $451,801, respectively. As of March 31, 2019, the Senior Credit Fund had one portfolio company on non-accrual status. As of December 31, 2018, the Senior Credit Fund had one portfolio company on non-accrual status. As of March 31, 2019 and December 31, 2018, the Senior Credit Fund had an investment in a money market fund managed by an affiliate of Group Inc. with a total fair value of $42,415 and $5,292, respectively. In addition, as of March 31, 2019, the Senior Credit Fund had ten portfolio companies with unfunded commitments totaling $15,589, and as of December 31, 2018, the Senior Credit Fund had ten portfolio companies with unfunded commitments totaling $17,114.

Below is a summary of the Senior Credit Fund’s portfolio, excluding an investment in a money market fund managed by an affiliate of Group Inc., followed by a listing of the individual loans in the Senior Credit Fund’s portfolio as of March 31, 2019 and December 31, 2018:


	As of
	March 31, 2019		December 31, 2018
Total senior secured debt⁽¹⁾	$	463,444	$	484,407
Weighted average current interest rate on senior secured debt⁽²⁾		7.6%		7.7%
Number of borrowers in the Senior Credit Fund		31		32
Largest loan to a single borrower⁽¹⁾	$	29,773	$	29,849

⁽¹⁾

At par amount, including fully unfunded commitments.

⁽²⁾

Computed as (a) the annual stated interest rate on accruing senior secured debt, divided by (b) total income producing senior secured debt at par amount, excluding fully unfunded commitments.

Senior Credit Fund Portfolio as of March 31, 2019


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value

1st Lien/Senior Secured Debt
3SI Security Systems, Inc.	Commercial Services & Supplies	8.36%	L + 5.75%; 1.00% Floor		06/16/2023	$	29,773	$	29,473		$	29,476
A Place For Mom, Inc.	Diversified Consumer Services	6.25%	L + 3.75%; 1.00% Floor		08/10/2024		17,820		17,804			17,374
AMCP Clean Acquisition Company, LLC	Commercial Services & Supplies	6.85%	L + 4.25%		06/16/2025		8,804		8,764			8,716
AMCP Clean Acquisition Company, LLC⁽¹⁾	Commercial Services & Supplies	6.89%	L + 4.25%		06/16/2025		2,127		824			810
Animal Supply Holdings, LLC⁽³⁾⁽⁵⁾	Distributors	12.75%	L + 10.00% (incl. 2.50% PIK); 1.00% Floor		02/22/2022		7,611		7,490			7,439
Ansira Partners, Inc.	Media	8.25%	L + 5.75%; 1.00% Floor		12/20/2022		9,226		9,163			9,180
Ansira Partners, Inc.⁽¹⁾	Media	8.25%	L + 5.75%; 1.00% Floor		12/20/2022		566		137			137
ATX Networks Corp.	Communications Equipment	8.60%	L + 6.00%; 1.00% Floor		06/11/2021		14,896		14,830			14,003
ATX Networks Corp.	Communications Equipment	8.60%	L + 6.00%; 1.00% Floor		06/11/2021		947		932			890
Badger Sportswear, Inc.	Textiles, Apparel & Luxury Goods	7.00%	L + 4.50%; 1.00% Floor		09/11/2023		14,622		14,522			14,183
Barbri, Inc.	Media	6.74%	L + 4.25%; 1.00% Floor		12/01/2023		12,486		12,436			12,268
CST Buyer Company	Diversified Consumer Services	7.50%	L + 5.00%; 1.00% Floor		03/01/2023		18,376		18,019			18,146
CST Buyer Company^{(1) (2)}	Diversified Consumer Services		L + 5.00%; 1.00% Floor		03/01/2023		1,800		(33	)		(23	)
DBRS Limited	Capital Markets	7.88%	L + 5.25%; 1.00% Floor		03/04/2022		11,520		11,465			11,405
Drilling Info Holdings, Inc.	Oil & Gas	6.75%	L + 4.25%		07/30/2025		18,350		18,265			18,212
Drilling Info Holdings, Inc.^{(1) (2)}	Oil & Gas		L + 4.25%		07/30/2025		68		–			(1	)
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		8,966		8,792			8,877
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		1,791		1,757			1,773
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		1,133		1,111			1,121
FWR Holding Corporation⁽¹⁾	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		1,175		271			282
GH Holding Company	Real Estate Management & Development	7.00%	L + 4.50%		02/28/2023		14,850		14,790			14,776
GI Revelation Acquisition LLC	Internet Software & Services	7.50%	L + 5.00%		04/16/2025		9,435		9,392			9,223
GK Holdings, Inc.	IT Services	8.60%	L + 6.00%; 1.00% Floor		01/20/2021		17,235		17,192			15,339
GlobalTranz Enterprises, Inc.	Road & Rail	6.50%	L + 4.00%		06/29/2025		21,890		21,789			21,781
GlobalTranz Enterprises, Inc.⁽¹⁾	Road & Rail	6.50%	L + 4.00%		06/29/2025		4,000		116			96
Halo Branded Solutions, Inc.	Commercial Services & Supplies	7.00%	L + 4.50%; 1.00% Floor		06/30/2025		10,476		10,380			10,267
Halo Branded Solutions, Inc.	Commercial Services & Supplies	7.00%	L + 4.50%; 1.00% Floor		06/30/2025		4,412		4,370			4,324
HC Group Holdings III, Inc.	Health Care Providers & Services	6.25%	L + 3.75%		04/07/2022		8,685		8,664			8,642
Hygiena Borrower LLC⁽³⁾	Life Sciences Tools & Services	6.60%	L + 4.00%; 1.00% Floor		08/26/2022		17,716		17,587			17,362
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor		08/26/2022		288		(2	)		(6	)
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor		08/26/2022		1,867		(18	)		(37	)
Jill Acquisition LLC	Textiles, Apparel & Luxury Goods	7.75%	L + 5.00%; 1.00% Floor		05/08/2022		13,800		13,739			13,570
Lattice Semiconductor Corporation	Semiconductors & Semiconductor Equipment	6.73%	L + 4.25%; 1.00% Floor		03/10/2021		8,271		8,194			8,292
Output Services Group, Inc.	Diversified Consumer Services	6.75%	L + 4.25%; 1.00% Floor		03/27/2024		6,960		6,934			6,386

Senior Credit Fund Portfolio as of March 31, 2019 (Continued)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value
Output Services Group, Inc.^{(1) (2)}	Diversified Consumer Services		L + 4.25%; 1.00% Floor		03/27/2024	$	1,026	$	–		$	(85	)
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.50%	L + 4.00%		06/11/2023		6,526		6,512			6,510
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.50%	L + 4.00%		06/11/2023		1,874		1,870			1,869
Pharmalogic Holdings Corp.^{(1) (2)}	Health Care Equipment & Supplies		L + 4.00%		06/11/2023		3,537		(7	)		(9	)
Professional Physical Therapy⁽⁴⁾	Health Care Providers & Services		L + 7.50% (Incl. 6.50% PIK); 1.00% Floor		12/16/2022		11,357		10,219			9,426
Regulatory DataCorp, Inc.	Diversified Financial Services	7.00%	L + 4.50%; 1.00% Floor		09/21/2022		4,949		4,949			4,850
SciQuest, Inc.	Internet Software & Services	6.50%	L + 4.00%; 1.00% Floor		12/28/2024		19,800		19,716			19,404
SMS Systems Maintenance Services, Inc.	IT Services	7.50%	L + 5.00%; 1.00% Floor		10/30/2023		14,663		14,609			11,283
Stackpath, LLC	Internet Software & Services	7.74%	L + 5.00%; 1.00% Floor		02/03/2023		16,703		16,586			15,032
Tronair Parent Inc.	Air Freight & Logistics	7.57%	L + 4.75%; 1.00% Floor		09/08/2023		13,650		13,558			13,309
U.S. Acute Care Solutions, LLC	Health Care Providers & Services	7.60%	L + 5.00%; 1.00% Floor		05/17/2021		12,708		12,640			12,644
VRC Companies, LLC⁽³⁾	Commercial Services & Supplies	9.00%	L + 6.50%; 1.00% Floor		03/31/2023		27,297		26,922			27,024
VRC Companies, LLC^{(1) (3)}	Commercial Services & Supplies	9.31%	L + 6.50%; 1.00% Floor		03/31/2022		1,412		874			880

Total 1st Lien/Senior Secured Debt									437,597			426,420

2nd Lien/Senior Secured Debt
GK Holdings, Inc.	IT Services	12.85%	L + 10.25%; 1.00% Floor		01/20/2022		6,000		5,940			4,800

Total 2nd Lien/Senior Secured Debt									5,940			4,800


Total Corporate Debt									443,537			431,220


Portfolio Company	Industry					Shares		Cost			Fair Value
Common Stock
Animal Supply Holdings, LLC⁽³⁾⁽⁶⁾	Distributors						3,283	$	–		$	235

Total Common Stock									–			235


			Yield			Shares		Cost			Fair Value

Investments in Affiliated Money Market Fund
Goldman Sachs Financial Square Government Fund – Institutional Shares^^^			2.35%⁽⁷⁾				42,415,194	$	42,415		$	42,415

Total Investments in Affiliated Money Market Fund									42,415			42,415


TOTAL INVESTMENTS								$	485,952		$	473,870

^{^^^}

While representing less than 5% of the portfolio company’s outstanding voting securities, the portfolio company is otherwise deemed to be an “affiliated person” of the Company under the Investment Company Act of 1940.

⁽⁺⁾

The terms in the Schedule above disclose the actual interest rate for partially or fully funded debt in effect as of the reporting date. Variable rate loans bear interest at a rate that may be determined by reference to either LIBOR (“L”) or alternate base rate (commonly based on the Prime Rate (“P”)), at the borrower’s option, which reset periodically based on the terms of the credit agreement. L loans are typically indexed to 12 month, 6 month, 3 month, 2 month, 1 month or 1 week L rates. As of March 31, 2019, rates for the 12 month, 6 month, 3 month, 2 month, 1 month and 1 week L are 2.71%, 2.66%, 2.60%, 2.56%, 2.49% and 2.42%, respectively. As of March 31, 2019, P was 5.50%. For investments with multiple reference rates or alternate base rates, the interest rate shown is the weighted average interest rate in effect at March 31, 2019.

⁽¹⁾

⁽²⁾

⁽³⁾

The Company also holds an investment in this portfolio company.

⁽⁴⁾

The investment is on non-accrual status as of March 31, 2019.

⁽⁵⁾

The investment includes an exit fee that is receivable upon repayment of the loan.

⁽⁶⁾

Non-income producing security.

⁽⁷⁾

The rate shown is the annualized seven-day yield as of March 31, 2019.

PIK – Payment-In-Kind

Senior Credit Fund Portfolio as of December 31, 2018


Portfolio Company	Industry	Interest Rate⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value

1st Lien/Senior Secured Debt
3SI Security Systems, Inc.	Commercial Services & Supplies	8.54%	L + 5.75%; 1.00% Floor		06/16/2023	$	29,849	$	29,533		$	29,550
A Place For Mom, Inc.	Diversified Consumer Services	6.27%	L + 3.75%; 1.00% Floor		08/10/2024		17,865		17,849			17,865
AMCP Clean Acquisition Company, LLC	Commercial Services & Supplies	7.05%	L + 4.25%		06/16/2025		8,827		8,785			8,705
AMCP Clean Acquisition Company, LLC⁽¹⁾	Commercial Services & Supplies	6.93%	L + 4.25%		06/16/2025		2,129		826			804
Ansira Partners, Inc.	Media	8.27%	L + 5.75%; 1.00% Floor		12/20/2022		9,249		9,182			9,203
Ansira Partners, Inc.⁽¹⁾	Media	8.27%	L + 5.75%; 1.00% Floor		12/20/2022		566		136			138
ATX Networks Corp.	Communications Equipment	9.80%	L + 7.00% (Incl. 1.00% PIK); 1.00% Floor		06/11/2021		14,976		14,903			14,078
ATX Networks Corp.	Communications Equipment	9.80%	L + 7.00% (Incl. 1.00% PIK); 1.00% Floor		06/11/2021		952		936			895
Badger Sportswear, Inc.	Textiles, Apparel & Luxury Goods	7.02%	L + 4.50%; 1.00% Floor		09/11/2023		14,660		14,555			14,367
Barbri, Inc.	Media	6.60%	L + 4.25%; 1.00% Floor		12/01/2023		12,486		12,434			12,174
CST Buyer Company	Diversified Consumer Services	7.52%	L + 5.00%; 1.00% Floor		03/01/2023		18,671		18,290			18,438
CST Buyer Company^{(1) (2)}	Diversified Consumer Services		L + 5.00%; 1.00% Floor		03/01/2023		1,800		(35	)		(22	)
DBRS Limited	Capital Markets	7.96%	L + 5.25%; 1.00% Floor		03/04/2022		11,550		11,490			11,377
DiscoverOrg, LLC⁽³⁾	Software	7.03%	L + 4.50%; 1.00% Floor		08/25/2023		7,900		7,868			7,861
Drilling Info Holdings, Inc.	Oil & Gas	6.77%	L + 4.25%		07/30/2025		17,001		16,920			16,895
Drilling Info Holdings, Inc.^{(1) (2)}	Oil & Gas		L + 4.25%		07/30/2025		1,460		(7	)		(9	)
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.26%	L + 5.75%; 1.00% Floor		08/21/2023		8,989		8,806			8,809
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.26%	L + 5.75%; 1.00% Floor		08/21/2023		1,791		1,756			1,755
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.26%	L + 5.75%; 1.00% Floor		08/21/2023		1,135		1,113			1,113
FWR Holding Corporation⁽¹⁾	Hotels, Restaurants & Leisure	10.25%	P + 4.75%; 2.00% Floor		08/21/2023		1,175		417			417
GH Holding Company	Real Estate Management & Development	7.02%	L + 4.50%		02/28/2023		14,888		14,824			14,813
GI Revelation Acquisition LLC	Internet Software & Services	7.52%	L + 5.00%		04/16/2025		9,459		9,415			9,281
GK Holdings, Inc.	IT Services	8.80%	L + 6.00%; 1.00% Floor		01/20/2021		17,280		17,232			15,725
GlobalTranz Enterprises, Inc.	Road & Rail	6.77%	L + 4.25%		06/29/2025		21,945		21,840			21,835
GlobalTranz Enterprises, Inc.^{(1) (2)}	Road & Rail		L + 4.25%		06/29/2025		4,000		–			(20	)
Halo Branded Solutions, Inc.	Commercial Services & Supplies	7.02%	L + 4.50%; 1.00% Floor		06/30/2025		10,503		10,403			10,188
Halo Branded Solutions, Inc.	Commercial Services & Supplies	7.02%	L + 4.50%; 1.00% Floor		06/30/2025		4,423		4,380			4,290
HC Group Holdings III, Inc.	Health Care Providers & Services	6.27%	L + 3.75%		04/07/2022		8,708		8,684			8,599
Hygiena Borrower LLC⁽³⁾	Life Sciences Tools & Services	6.80%	L + 4.00%; 1.00% Floor		08/26/2022		17,762		17,623			17,406
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor		08/26/2022		288		(2	)		(6	)
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor		08/26/2022		1,867		(20	)		(37	)

Senior Credit Fund Portfolio as of December 31, 2018 (Continued)


Portfolio Company	Industry	Interest Rate⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value
Jill Acquisition LLC	Textiles, Apparel & Luxury Goods	7.53%	L + 5.00%; 1.00% Floor		05/08/2022	$	13,839	$	13,774		$	13,620
Lattice Semiconductor Corporation	Semiconductors & Semiconductor Equipment	6.63%	L + 4.25%; 1.00% Floor		03/10/2021		9,212		9,122			9,212
Output Services Group, Inc.	Diversified Consumer Services	6.77%	L + 4.25%; 1.00% Floor		03/27/2024		6,978		6,951			6,751
Output Services Group, Inc.^{(1) (2)}	Diversified Consumer Services		L + 4.25%; 1.00% Floor		03/27/2024		1,026		–			(33	)
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.52%	L + 4.00%		06/11/2023		6,542		6,528			6,526
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.52%	L + 4.00%		06/11/2023		1,878		1,874			1,874
Pharmalogic Holdings Corp.^{(1) (2)}	Health Care Equipment & Supplies		L + 4.00%		06/11/2023		3,537		(8	)		(9	)
Professional Physical Therapy⁽⁴⁾	Health Care Providers & Services		L + 7.50% PIK; 1.00% Floor		12/16/2022		11,265		10,283			9,350
Regulatory DataCorp, Inc.	Diversified Financial Services	7.02%	L + 4.50%; 1.00% Floor		09/21/2022		4,962		4,962			4,863
SciQuest, Inc.	Internet Software & Services	6.53%	L + 4.00%; 1.00% Floor		12/28/2024		19,850		19,763			19,453
SMS Systems Maintenance Services, Inc.	IT Services	7.52%	L + 5.00%; 1.00% Floor		10/30/2023		14,700		14,644			10,924
Stackpath, LLC	Internet Software & Services	7.59%	L + 5.00%; 1.00% Floor		02/03/2023		16,703		16,580			16,034
Tronair Parent Inc.	Air Freight & Logistics	7.56%	L + 4.75%; 1.00% Floor		09/08/2023		13,685		13,589			13,138
U.S. Acute Care Solutions, LLC	Health Care Providers & Services	7.52%	L + 5.00%; 1.00% Floor		05/14/2021		12,740		12,665			12,676
VRC Companies, LLC⁽³⁾	Commercial Services & Supplies	9.02%	L + 6.50%; 1.00% Floor		03/31/2023		27,361		26,966			27,087
VRC Companies, LLC^{(1) (3)}	Commercial Services & Supplies	9.45%	L + 6.50%; 1.00% Floor		03/31/2022		1,412		699			706

Total 1st Lien/Senior Secured Debt									438,528			428,659


1st Lien/Last-Out Unitranche⁽⁵⁾
ASC Acquisition Holdings, LLC⁽³⁾	Distributors	10.03%	L + 7.50%; 1.00% Floor		12/15/2021		8,063		8,010			7,861

Total 1st Lien/Last-Out Unitranche									8,010			7,861


2nd Lien/Senior Secured Debt
DiscoverOrg, LLC⁽³⁾	Software	11.03%	L + 8.50%; 1.00% Floor		02/23/2024		10,500		10,370			10,421
GK Holdings, Inc.	IT Services	13.05%	L + 10.25%; 1.00% Floor		01/20/2022		6,000		5,935			4,860

Total 2nd Lien/Senior Secured Debt									16,305			15,281

Total Corporate Debt									462,843			451,801


			Yield			Shares		Cost			Fair Value

Investments in Affiliated Money Market Fund
Goldman Sachs Financial Square Government Fund – Institutional Shares^^^			2.34%⁽⁶⁾				5,292,068	$	5,292		$	5,292

Total Investments in Affiliated Money Market Fund									5,292			5,292


TOTAL INVESTMENTS								$	468,135		$	457,093

^{^^^}

⁽⁺⁾

The terms in the Schedule above disclose the actual interest rate for partially or fully funded debt in effect as of the reporting date. Variable rate loans bear interest at a rate that may be determined by reference to either LIBOR (“L”) or alternate base rate (commonly based on the Prime Rate (“P”)), at the borrower’s option, which reset periodically based on the terms of the credit agreement. L loans are typically indexed to 12 month, 6 month, 3 month, 2 month, 1 month or 1 week L rates. As of December 31, 2018, rates for the 12 month, 6 month, 3 month, 2 month, 1 month and 1 week L are 3.01%, 2.88%, 2.81%, 2.61%, 2.50% and 2.41%, respectively. As of December 31, 2018, P was 5.50%. For investments with multiple reference rates or alternate base rates, the interest rate shown is the weighted average interest rate in effect at December 31, 2018.

⁽¹⁾

⁽²⁾

⁽³⁾

The Company also holds a portion of senior secured debt in this portfolio company.

⁽⁴⁾

The investment is on non-accrual status as of December 31, 2018.

⁽⁵⁾

⁽⁶⁾

The rate shown is the annualized seven-day yield as of December 31, 2018.

PIK – Payment-In-Kind

Below is selected balance sheet information for the Senior Credit Fund as of March 31, 2019 and December 31, 2018:


	As of March 31, 2019		As of December 31, 2018
Selected Balance Sheet Information
Total investments, at fair value	$	473,870	$	457,093
Cash and other assets		12,882		42,847
Total assets	$	486,752	$	499,940

Debt ⁽¹⁾	$	286,338	$	298,339
Other liabilities		8,551		8,689
Total liabilities	$	294,889	$	307,028
Members’ equity		191,863		192,912
Total liabilities and members’ equity	$	486,752	$	499,940

⁽¹⁾	Net of deferred financing costs for the SPV I Term Loan Facility, which were in the amount of $2,085 and $2,161 as of March 31, 2019 and December 31, 2018, respectively.

Below is selected statements of operations information for the Senior Credit Fund for the three months ended March 31, 2019 and 2018:


	For the Three Months Ended March 31, 2019			For the Three Months Ended March 31, 2018
Selected Statements of Operations Information:
Total investment income	$	9,196		$	10,331

Expenses
Interest and other debt expense		4,002			3,376
Professional fees		198			114
Administration and custodian fees		98			97
Other expenses		7			20
Total expenses	$	4,305		$	3,607
Total net income		4,891			6,724
Net realized gain (loss) on investments		–			–
Net change in unrealized appreciation (depreciation) on investments		(1,040	)		881
Net increase (decrease) in members’ equity	$	3,851		$	7,605

Loan Origination and Structuring Fees

If the loan origination and structuring fees earned by the Senior Credit Fund (including directly or indirectly through SPV I or another vehicle) during a period exceed the Senior Credit Fund’s expenses (excluding interest and other debt expenses), such excess is paid as a fee to the Member(s) responsible for the origination of the loans pro rata in accordance with the total loan origination and structuring fees earned by the Senior Credit Fund with respect to the loans originated by such Member. The loan origination and structuring fee is accrued quarterly and included in other income from controlled affiliated investments on the Consolidated Statements of Operations and paid annually. For the three months ended March 31, 2019 and 2018, the Company did not accrue income based on loan origination and structuring fees.

5.	FAIR VALUE MEASUREMENT

The fair value of a financial instrument is the amount that would be received to sell an asset or would be paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e., the exit price).

The fair value hierarchy under ASC 820 prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The levels used for classifying investments are not necessarily an indication of the risk associated with investing in these securities. The three levels of the fair value hierarchy are as follows:

Basis of Fair Value Measurement

Level 1 – Inputs to the valuation methodology are quoted prices available in active markets for identical instruments as of the reporting date. The types of financial instruments included in Level 1 include unrestricted securities, including equities and derivatives, listed in active markets.

Level 2 – Inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date. The types of financial instruments in this category include less liquid and restricted securities listed in active markets, securities traded in other than active markets, government and agency securities and certain over-the-counter derivatives where the fair value is based on observable inputs.

Level 3 – Inputs to the valuation methodology are unobservable and significant to overall fair value measurement. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category include investments in privately held entities and certain over-the-counter derivatives where the fair value is based on unobservable inputs.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Note 2 “Significant Accounting Policies” should be read in conjunction with the information outlined below.

The table below presents the valuation techniques and the nature of significant inputs generally used in determining the fair value of Level 2 Instruments.


Level 2 Instruments		Valuation Techniques and Significant Inputs
Equity and Fixed Income		The types of instruments that trade in markets that are not considered to be active but are valued based on quoted market prices, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency include commercial paper, most government agency obligations, most corporate debt securities, certain mortgage-backed securities, certain bank loans, less liquid publicly listed equities, certain state and municipal obligations, certain money market instruments and certain loan commitments. Valuations of Level 2 Equity and Fixed Income instruments can be verified to quoted prices, broker or dealer quotations or alternative pricing sources with reasonable levels of price transparency. Consideration is given to the nature of the quotations (e.g. indicative or firm) and the relationship of recent market activity to the prices provided from alternative pricing sources.

Derivative Contracts		OTC derivatives (both centrally cleared and bilateral) are valued using market transactions and other market evidence whenever possible, including market-based inputs to models, calibration to market-clearing transactions, broker or dealer quotations, or other alternative pricing sources with reasonable levels of price transparency. Where models are used, the selection of a particular model to value an OTC derivative depends upon the contractual terms of, and specific risks inherent in, the instrument, as well as the availability of pricing information in the market. The Company generally uses similar models to value similar instruments. Valuation models require a variety of inputs, including contractual terms, market prices, yield curves, credit curves, measures of volatility, voluntary and involuntary prepayment rates, loss severity rates and correlations of such inputs. For OTC derivatives that trade in liquid markets, model inputs can generally be verified and model selection does not involve significant management judgment. OTC derivatives are classified within Level 2 of the fair value hierarchy when significant inputs are corroborated by market evidence.

The table below presents the valuation techniques and the nature of significant inputs generally used in determining the fair value of Level 3 Instruments.

Level 3 Instruments

Valuation Techniques and Significant Inputs

Bank Loans, Corporate Debt, and Other Debt

Obligations

Valuations are generally based on discounted cash flow techniques, for which the significant inputs are the amount and timing of expected future cash flows, market yields and recovery assumptions. The significant inputs are generally determined based on relative value analyses, which incorporate comparisons both to credit default swaps that reference the same underlying credit risk and to other debt instruments for the same issuer for which observable prices or broker quotes are available. Other valuation methodologies are used as appropriate including market comparables, transactions in similar instruments and recovery/liquidation analysis.

Level 3 Instruments

Valuation Techniques and Significant Inputs

Equity

Recent third-party investments or pending transactions are considered to be the best evidence for any change in fair value. When these are not available, the following valuation methodologies are used, as appropriate and available:

• Transactions in similar instruments;

• Discounted cash flow techniques;

• Third party appraisals; and

• Industry multiples and public comparables.

Evidence includes recent or pending reorganizations (for example, merger proposals, tender offers and debt restructurings) and significant changes in financial metrics, including:

• Current financial performance as compared to projected performance;

• Capitalization rates and multiples; and

• Market yields implied by transactions of similar or related assets.

The tables below present the ranges of significant unobservable inputs used to value the Company’s Level 3 assets and liabilities as of March 31, 2019 and December 31, 2018. These ranges represent the significant unobservable inputs that were used in the valuation of each type of instrument, but they do not represent a range of values for any one instrument. For example, the lowest yield in 1st Lien/Senior Secured Debt is appropriate for valuing that specific debt investment, but may not be appropriate for valuing any other debt investments in this asset class. Accordingly, the ranges of inputs presented below do not represent uncertainty in, or possible ranges of, fair value measurements of the Company’s Level 3 assets and liabilities.


Level 3 Instruments	Level 3 Assets as of March 31, 2019⁽¹⁾	Significant Unobservable Inputs by Valuation Techniques⁽²⁾	Range⁽³⁾ of Significant Unobservable Inputs (Weighted Average⁽⁴⁾) as of March 31, 2019
Bank Loans, Corporate Debt, and Other Debt Obligations	1st Lien/Senior Secured	Discounted cash flows:
Bank Loans, Corporate Debt, and Other Debt Obligations	$733,911	• Discount Rate	7.9% – 25.7% (11.1%)
		Collateral analysis:
		• Recovery Rate	98.0%
	1st Lien/Last-Out Unitranche	Discounted cash flows:
	$101,087	• Discount Rate	8.7% – 16.0% (11.7%)
		Collateral analysis:
		• Recovery Rate	80.8% – 100.0% (83.1%)
	2nd Lien/Senior Secured	Discounted cash flows:
	$198,812	• Discount Rate	10.6% – 14.2% (11.5%)
		Collateral analysis:
		• Recovery Rate	10.0%
	Unsecured Debt	Discounted cash flows:
	$6,701	• Discount Rate	12.0% – 12.3% (12.2%)
		Collateral analysis:
		• Recovery Rate	100.0%
Equity	Preferred Stock	Comparable multiples:
	$44,865	• EV/Revenue	1.4x – 3.3x (1.1x)
		Comparable multiples:
		• EV/EBITDA⁽⁵⁾	7.0x – 15.8x (8.5x)
	Common Stock	Discounted cash flows:
	$50,479	• Discount Rate	15.0% – 30.8% (24.9%)
		Comparable multiples:
		• EV/Revenue	0.6x – 8.5x (5.0x)
		Comparable multiples:
		• EV/EBITDA⁽⁵⁾	6.0x – 12.7x (7.9x)

⁽¹⁾

Included within Level 3 Assets of $1,225,449 is an amount of $89,594 for which the Investment Adviser did not develop the unobservable inputs (examples include single source broker quotations, third party pricing, and prior transactions).

⁽²⁾

The fair value of any one instrument may be determined using multiple valuation techniques. For example, market comparable and discounted cash flows may be used together to determine fair value. Therefore, the Level 3 balance encompasses both of these techniques.

⁽³⁾

The range for an asset category consisting of a single investment represents the relevant market data considered in determining the fair value of the investment.

⁽⁴⁾

Weighted average for an asset category consisting of multiple investments is calculated by weighting the significant unobservable input by the relative fair value of the investment. Weighted average for an asset category consisting of a single investment represents the significant unobservable input used in the fair value of the investment.

⁽⁵⁾

Enterprise value of portfolio company as a multiple of earnings before interest, taxes, depreciation and amortization (“EBITDA”).


Level 3 Instruments	Level 3 Assets as of December 31, 2018⁽¹⁾	Significant Unobservable Inputs by Valuation Techniques⁽²⁾	Range⁽³⁾ of Significant Unobservable Inputs (Weighted Average⁽⁴⁾) as of December 31, 2018
Bank Loans, Corporate Debt, and Other Debt Obligations	1st Lien/Senior Secured	Discounted cash flows:
	$608,844	• Discount Rate	8.4% – 24.5% (11.6%)
		Collateral analysis:
		• Recovery Rate	95.3%
	1st Lien/Last-Out Unitranche	Discounted cash flows:
	$106,879	• Discount Rate	9.3% – 16.1% (11.8%)

		Collateral analysis:
		• Recovery Rate	83.5% – 100.0% (85.4%)
	2nd Lien/Senior Secured	Discounted cash flows:
	$263,142	• Discount Rate	10.7% – 16.5% (11.6%)

		Comparable multiples:
		• EV/EBITDA⁽⁵⁾	7.0x – 17.5x (8.3x)

		Collateral analysis:
		• Recovery Rate	71.8%
	Unsecured Debt	Discounted cash flows:
	$6,697	• Discount Rate	12.1% – 12.3% (12.2%)

		Collateral analysis:
		• Recovery Rate	100.0%
Equity	Preferred Stock	Comparable multiples:
	$19,634	• EV/EBITDA⁽⁵⁾	6.8x – 18.9x (9.1x)

	Common Stock	Discounted cash flows:
	$19,674	• Discount Rate	14.6% – 31.0% (24.4%)

		Comparable multiples:
		• EV/Revenue	0.4x – 1.6x (0.6x)

		Comparable multiples:
		• EV/EBITDA⁽⁵⁾	5.5x – 13.0x (6.9x)

⁽¹⁾	Included within Level 3 Assets of $1,216,894 is an amount of $192,024 for which the Investment Adviser did not develop the unobservable inputs (examples include single source broker quotations, third party pricing, and prior transactions).

⁽²⁾	The fair value of any one instrument may be determined using multiple valuation techniques. For example, market comparable and discounted cash flows may be used together to determine fair value. Therefore, the Level 3 balance encompasses both of these techniques.

⁽³⁾	The range for an asset category consisting of a single investment represents the relevant market data considered in determining the fair value of the investment.

⁽⁴⁾

⁽⁵⁾	Enterprise value of portfolio company as a multiple of EBITDA.

As noted above, the income and market approaches were used in the determination of fair value of certain Level 3 assets as of March 31, 2019 and December 31, 2018. The significant unobservable inputs used in the income approach are the discount rate or market yield used to discount the estimated future cash flows expected to be received from the underlying investment, which include both future principal and interest payments. An increase in the discount rate or market yield would result in a decrease in the fair value. Included in the consideration and selection of discount rates is risk of default, rating of the investment, call provisions and comparable company investments. The significant unobservable inputs used in the market approach are based on market comparable transactions and market multiples of publicly traded comparable companies. Increases or decreases in market comparable transactions or market multiples would result in an increase or decrease, respectively, in the fair value.

The following is a summary of the Company’s assets categorized within the fair value hierarchy as of March 31, 2019:


Assets	Level 1		Level 2		Level 3		Total
1st Lien/Senior Secured Debt	$	–	$	34,707	$	779,837	$	814,544
1st Lien/Last-Out Unitranche		–		–		101,087		101,087
2nd Lien/Senior Secured Debt		–		48,554		242,480		291,034
Unsecured Debt		–		–		6,701		6,701
Preferred Stock		–		–		44,865		44,865
Common Stock		456		–		50,479		50,935
Subtotal	$	456	$	83,261	$	1,225,449	$	1,309,166
Investments measured at NAV⁽¹⁾								95,931
Total assets							$	1,405,097

⁽¹⁾ Includes equity investment in the Senior Credit Fund.

Derivatives	Level 1		Level 2		Level 3		Total
Foreign currency forward contracts (asset)⁽¹⁾	$	–	$	167	$	–	$	167
Total	$	–	$	167	$	–	$	167

⁽¹⁾

Amounts disclosed represent the unrealized appreciation on the foreign currency forward contracts.

The following is a summary of the Company’s assets categorized within the fair value hierarchy as of December 31, 2018:


Assets	Level 1		Level 2		Level 3		Total
1st Lien/Senior Secured Debt	$	–	$	18,400	$	711,204	$	729,604
1st Lien/Last-Out Unitranche		–		–		106,879		106,879
2nd Lien/Senior Secured Debt		–		43,190		348,741		391,931
Unsecured Debt		–		–		6,697		6,697
Preferred Stock		–		–		21,534		21,534
Common Stock		–		504		21,839		22,343
Subtotal	$	–	$	62,094	$	1,216,894	$	1,278,988
Investments measured at NAV⁽¹⁾								96,456
Total assets							$	1,375,444

⁽¹⁾ Includes equity investment in the Senior Credit Fund.

Derivatives	Level 1		Level 2		Level 3		Total
Foreign currency forward contracts (asset)⁽¹⁾	$	–	$	89	$	–	$	89
Total	$	–	$	89	$	–	$	89

⁽¹⁾

Amounts disclosed represent the unrealized appreciation on the foreign currency forward contracts.

The following is a reconciliation of Level 3 assets for the three months ended March 31, 2019:


Level 3	Beginning Balance as of January 1, 2019		Purchases⁽¹⁾		Net Realized Gain (Loss)			Net Change in Unrealized Appreciation (Depreciation)⁽²⁾			Sales and Settlements⁽¹⁾			Net Amortization of Premium/ Discount		Transfers In		Transfers Out			Ending Balance as of March 31, 2019
1st Lien/Senior Secured Debt	$	711,204	$	81,430	$	(2	)	$	(1	)	$	(14,404	)	$	1,610	$	–	$	–		$	779,837
1st Lien/Last-Out Unitranche		106,879		202		113			(144	)		(6,044	)		81		–		–			101,087
2nd Lien/Senior Secured Debt		348,741		10,382		(24,833	)		6,982			(93,830	)		1,098		–		(6,060	)		242,480
Unsecured Debt		6,697		–		–			4			–			–		–		–			6,701
Preferred Stock		21,534		25,000		–			(1,669	)		–			–		–		–			44,865
Common Stock		21,839		29,231		–			(591	)		–			–		–		–			50,479
Total assets	$	1,216,894	$	146,245	$	(24,722	)	$	4,581		$	(114,278	)	$	2,789	$	–	$	(6,060	)	$	1,225,449

⁽¹⁾

Purchases may include PIK and securities received in corporate actions and restructurings. Sales and Settlements may include securities delivered in corporate actions and restructuring of investments.

⁽²⁾

Change in unrealized appreciation (depreciation) relating to assets still held at March 31, 2019 totaled $(9,555) consisting of the following: 1st Lien/Senior Secured Debt $(4), 1st Lien/Last-Out Unitranche $(176), 2nd Lien/Senior Secured Debt $(7,119), Unsecured Debt $4, Preferred Stock $(1,669) and Common Stock $(591).

The following is a reconciliation of Level 3 assets for the three months ended March 31, 2018:


Level 3	Beginning Balance as of January 1, 2018		Purchases⁽¹⁾		Net Realized Gain (Loss)		Net Change in Unrealized Appreciation (Depreciation)⁽²⁾			Sales and Settlements⁽¹⁾			Net Amortization of Premium/ Discount		Transfers In		Transfers Out		Ending Balance as of March 31, 2018
1st Lien/Senior Secured Debt	$	387,473	$	17,368	$	4	$	(311	)	$	(4,342	)	$	449	$	–	$	—	$	400,641
1st Lien/Last-Out Unitranche		273,965		14,979		–		(1,054	)		(51,380	)		1,226		–		–		237,736
2nd Lien/Senior Secured Debt		374,915		39,687		–		357			(8,330	)		315		–		–		406,944
Unsecured Debt		3,900		1,557		–		–			–			–		–		–		5,457
Preferred Stock		12,836		–		–		(321	)		–			–		–		–		12,515
Common Stock		22,606		1,300		1,550		(1,237	)		(2,150	)		–		–		–		22,069
Total assets	$	1,075,695	$	74,891	$	1,554	$	(2,566	)	$	(66,202	)	$	1,990	$	–	$	–	$	1,085,362

⁽¹⁾

⁽²⁾

Change in unrealized appreciation (depreciation) relating to assets still held at March 31, 2018 totaled $(2,376) consisting of the following: 1st Lien/Senior Secured Debt $(311), 1st Lien/Last-Out Unitranche $(921), 2nd Lien/Senior Secured Debt $414, Unsecured Debt $0, Preferred Stock $(321) and Common Stock $(1,237).

Transfers between levels of the fair value hierarchy are reported at the beginning of the reporting period in which they occur. For the three months ended March 31, 2019, transfers from Level 3 to Level 2 were primarily due to increased price transparency. For the three months ended March 31, 2018, there were no transfers between levels of the fair value hierarchy.

Debt Not Carried at Fair Value

The fair value of the Revolving Credit Facility, which would be categorized as Level 3 within the fair value hierarchy as of March 31, 2019 and December 31, 2018, approximates its carrying value. The fair value of the Company’s Convertible Notes, which would be categorized as Level 2 within the fair value hierarchy, as of March 31, 2019 and December 31, 2018 was $154,709 and $151,125, respectively, based on broker quotes received by the Company.

DEBT

On June 15, 2018, the Company’s stockholders approved the application of the reduced asset coverage requirements in Section 61(a)(2) of the Investment Company Act to the Company. As a result of this approval, the Company is now permitted to borrow amounts such that its asset coverage ratio, as defined in the Investment Company Act, is at least 150% after such borrowing (if certain requirements are met), rather than 200%, as previously required. As of March 31, 2019 and December 31, 2018, the Company’s asset coverage ratio based on the aggregate amount outstanding of senior securities was 197% and 206%, respectively.

The Company’s outstanding debt as of March 31, 2019 and December 31, 2018 was as follows:


	As of
	March 31, 2019						December 31, 2018
	Aggregate Borrowing Amount Committed		Amount Available		Carrying Value⁽⁴⁾		Aggregate Borrowing Amount Committed		Amount Available		Carrying Value⁽⁴⁾
Revolving Credit Facility⁽¹⁾⁽²⁾	$	795,000	$	240,611	$	554,309	$	695,000	$	186,049	$	509,419
Convertible Notes⁽³⁾		155,000		–		150,086		155,000		–		149,682
Total Debt	$	950,000	$	240,611	$	704,395	$	850,000	$	186,049	$	659,101

⁽¹⁾

Provides, under certain circumstances, a total borrowing capacity of $1,000,000.

⁽²⁾

The Company may borrow amounts in USD or certain other permitted currencies. As of March 31, 2019, the Company had outstanding borrowings denominated in USD of $516,450 and in Euros (EUR) of EUR 33,750. As of December 31, 2018, the Company had outstanding borrowings denominated in USD of $470,750 and in Euros (EUR) of EUR 33,750.

⁽³⁾

The carrying value of the Company’s Convertible Notes is presented net of unamortized debt issuance costs of $3,562 and OID net of accretion of $1,352 as of March 31, 2019, and net of unamortized debt issuance costs of $3,862 and OID net of accretion of $1,456 as of December 31, 2018.

⁽⁴⁾

Debt outstanding denominated in currencies other than USD have been converted to USD using the applicable foreign currency exchange rate as of March 31, 2019 and December 31, 2018.

The combined weighted average interest rate of the aggregate borrowings outstanding for the three months ended March 31, 2019 and the year ended December 31, 2018 was 4.42% and 4.10% respectively.

Revolving Credit Facility

On September 19, 2013, the Company entered into a Revolving Credit Facility with various lenders. SunTrust Bank serves as administrative agent and Bank of America, N.A. serves as syndication agent under the Revolving Credit Facility. The Company has amended and restated the Revolving Credit Facility on October 3, 2014, November 3, 2015, December 16, 2016, February 21, 2018 and September 17, 2018.

The aggregate committed borrowing amount under the Revolving Credit Facility is $795,000. The Revolving Credit Facility includes an uncommitted accordion feature that allows the Company, under certain circumstances, to increase the borrowing capacity of the Revolving Credit Facility up to $1,000,000.

Borrowings denominated in USD, including amounts drawn in respect of letters of credit, bear interest (at the Company’s election) of either (i) LIBOR plus a margin of either 1.75% or 2.00%, subject to borrowing base conditions or (ii) an alternative base rate, which is the higher of the Prime Rate, Federal Funds Rate plus 0.50% or overnight LIBOR plus 1.00%, plus either 0.75% or 1.00%, subject to borrowing base conditions. Borrowings denominated in EUR bear interest (at the company’s election) of EUR LIBOR plus a margin of either 1.75% or 2.00%, subject to borrowing base conditions. The Company may elect either the LIBOR, EUR LIBOR, or an alternative base rate at the time of borrowing, and borrowings may be converted from one rate to another at any time, subject to certain conditions. Interest is payable quarterly in arrears. The Company pays a fee of 0.375% per annum on committed but undrawn amounts under the Revolving Credit Facility, payable quarterly in arrears. Any amounts borrowed under the Revolving Credit Facility will mature, and all accrued and unpaid interest will be due and payable, on February 21, 2023.

The Revolving Credit Facility may be guaranteed by certain of the Company’s domestic subsidiaries, including any that are formed or acquired by the Company in the future (collectively, the “Guarantors”). The Senior Credit Fund is not a Guarantor of the Revolving Credit Facility. Proceeds from borrowings may be used for general corporate purposes, including the funding of portfolio investments.

The Company’s obligations to the lenders under the Revolving Credit Facility are secured by a first priority security interest in substantially all of the Company’s portfolio of investments and cash, with certain exceptions. The Revolving Credit Facility contains certain covenants, including: (i) maintaining a minimum stockholder’s equity of $500,000 plus 25% of net proceeds of the sale of equity interests after February 21, 2018, (ii) maintaining a minimum asset coverage ratio of at least 150%, (iii) maintaining a minimum asset coverage ratio of 200% with respect to the consolidated assets (with certain limitations on the contribution of equity in financing subsidiaries as specified therein) of the Company and its subsidiary guarantors to the secured debt of the Company and its subsidiary guarantors, (iv) maintaining a minimum Company net worth of at least $350,000, (v) maintaining a minimum liquidity test of at least 10% of the covered debt amount during any period when the adjusted covered debt balance is greater than 90% of the adjusted borrowing base, as defined in the Revolving Credit Facility, and (vi) complying with restrictions on industry concentrations in the Company’s investment portfolio. The Company is in compliance with these covenants.

Costs of $12,093 were incurred in connection with obtaining and amending the 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 Revolving Credit Facility using the straight-line method. As of March 31, 2019 and December 31, 2018, deferred financing costs were $5,512 and $5,436, respectively.

The summary information of the Revolving Credit Facility for the three months ended March 31, 2019 and 2018 is as follows:


	Three Months Ended March 31, 2019		Three Months Ended March 31, 2018
Borrowing interest expense	$	5,781	$	3,671
Facility fees		186		227
Amortization of financing costs		339		314
Total	$	6,306	$	4,212
Weighted average interest rate		4.38%		3.63%
Average outstanding balance	$	534,673	$	410,408

Convertible Notes

On October 3, 2016, the Company closed an offering of $115,000 aggregate principal amount of unsecured Convertible Notes, which includes $15,000 aggregate principal amount issued pursuant to the initial purchasers’ exercise in full of an over-allotment option (the “Initial Convertible Notes”). The sale of the Initial Convertible Notes generated net proceeds of approximately $110,900. The Company used the net proceeds of the offering to pay down debt under the Revolving Credit Facility.

On July 2, 2018, the Company closed an additional offering of $40,000 aggregate principal amount of Convertible Notes (the “Additional Convertible Notes” and together with Initial Convertible Notes, the “Convertible Notes”). The Additional Convertible Notes have identical terms, are fungible with and are part of the Initial Convertible Notes. The sale of the Additional Convertible Notes generated net proceeds of approximately $38,569. The Company used the net proceeds of the offering to pay down debt under the Revolving Credit Facility.

The Convertible Notes were issued pursuant to an indenture between the Company and Wells Fargo Bank, National Association, as Trustee. Wells Fargo Bank, National Association and/or its affiliates provide bank lending and distribution services to certain Goldman Sachs funds. The Convertible Notes bear interest at a rate of 4.50% per year, payable semi-annually in arrears on April 1 and October 1 of each year, commencing on April 1, 2017. The Convertible Notes will mature on April 1, 2022, unless repurchased or converted in accordance with their terms prior to such date. In certain circumstances, the Convertible Notes will be convertible into cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, based on an initial conversion rate of 40.8397 shares of the Company’s common stock per one thousand dollars principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $24.49 per share of common stock, subject to customary anti-dilution adjustments and the other terms of the indenture governing the Convertible Notes. The conversion price is approximately 10.0% above the $22.26 per share closing price of the Company’s common stock on September 27, 2016 and 16.7% above the $20.99 per share closing price of our common stock on June 26, 2018. The Company will not have the right to redeem the Convertible Notes prior to maturity.

Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding October 1, 2021 only under the following circumstances: (1) during any calendar quarter, if the last reported sale price of the Company’s common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per one thousand dollars principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of the Company’s common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after October 1, 2021, until the close of business on the scheduled trading day immediately preceding the maturity date, holders may convert their notes at any time, regardless of the occurrence or nonoccurrence of any of the foregoing circumstances.

The Convertible Notes are accounted for in accordance with ASC Topic 470-20, Debt with Conversion and Other Options. Upon conversion of any of the Convertible Notes, the Company intends to pay the outstanding principal amount in cash and, to the extent that the conversion value exceeds the principal amount, has the option to pay the excess amount in cash or shares of the Company’s common stock (or a combination of cash and shares), subject to the requirements of the indenture governing the Convertible Notes. The Company has determined that the embedded conversion options in the Convertible Notes are not required to be separately accounted for as derivatives under ASC Topic 815, Derivatives and Hedging. At the time of issuance the values of the debt and equity components of the Initial Convertible Notes and Additional Convertible Notes were approximately 99.4% and 0.6%, and 97.9% and 2.1%, respectively.

The OID equal to the equity component of the Convertible Notes was recorded in “paid-in capital in excess of par” in the accompanying Consolidated Statements of Assets and Liabilities. The Company records interest expense comprised of both stated interest and amortization of the OID. At the time of issuance, the equity components of the Initial Convertible Notes and the Additional Convertible Notes were $743 and $836, respectively. Additionally, the issuance costs associated with the Convertible Notes were allocated to the debt and equity components in proportion to the allocation of the values at the time of issuance and accounted for as debt issuance costs and equity issuance costs, respectively.

As of March 31, 2019 and December 31, 2018, the components of the carrying value of the Convertible Notes were as follows:


	March 31, 2019		December 31, 2018
Principal amount of debt	$	155,000	$	155,000
OID, net of accretion		1,352		1,456
Unamortized debt issuance costs		3,562		3,862
Carrying value	$	150,086	$	149,682
Stated interest rate		4.50%		4.50%
Effective interest rate (stated interest rate plus accretion of OID)		4.77%		4.76%

For the three months ended March 31, 2019 and 2018, the components of interest and other debt expenses related to the Convertible Notes were as follows:


	Three Months Ended March 31, 2019		Three Months Ended March 31, 2018
Borrowing interest expense	$	1,744	$	1,294
Accretion of OID		104		32
Amortization of debt issuance costs		299		185
Total	$	2,147	$	1,511

7.	DERIVATIVES

The Company enters into foreign currency forward contracts from time to time to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the Company’s investments denominated in foreign currencies.

In order to better define its contractual rights and to secure rights that will help the Company mitigate its counterparty risk, the Company may enter into an International Swaps and Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement”) or a similar agreement with its derivative counterparties. An ISDA Master Agreement is a bilateral agreement between the Company and a counterparty that governs OTC derivatives, including foreign currency forward contracts, and typically contains, among other things, collateral posting terms and netting provisions in the event of a default and/or termination event. The provisions of the ISDA Master Agreement typically permit a single net payment in the event of a default (close-out netting) or similar event, including the bankruptcy or insolvency of the counterparty.

For financial reporting purposes, cash collateral that has been pledged to cover obligations of the Company and cash collateral received from the counterparty, if any, is included in the Consolidated Statements of Assets and Liabilities as due to/due from broker. The Company minimizes counterparty credit risk by only entering into agreements with counterparties that they believe to be of good standing and by monitoring the financial stability of those counterparties.

For the three months ended March 31, 2019, the Company’s average USD notional exposure to foreign currency forward contracts was $3,492. The Company did not hold any derivative instruments prior to August 8, 2018.

The following table sets forth the Company’s net exposure to foreign currency forward contracts that are subject to ISDA Master Agreements or similar agreements as of March 31, 2019.


Counterparty	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		Collateral (Received) Pledged⁽¹⁾		Net Amounts⁽²⁾
Bank of America, N.A.	$	167	$	–	$	167	$	–	$	167
Total	$	167	$	–	$	167	$	–	$	167

⁽¹⁾

Amount excludes excess cash collateral paid.

⁽²⁾

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

The following table sets forth the Company’s net exposure to foreign currency forward contracts that are subject to ISDA Master Agreements or similar agreements as of December 31, 2018.


Counterparty	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		Collateral (Received) Pledged⁽¹⁾		Net Amounts⁽²⁾
Bank of America, N.A.	$	89	$	–	$	89	$	–	$	89
Total	$	89	$	–	$	89	$	–	$	89

⁽¹⁾

Amount excludes excess cash collateral paid.

⁽²⁾

For the three months ended March 31, 2019 and 2018, the effect of transactions in derivative instruments to the Consolidated Statements of Operations was as follows:


	For the Three Months Ended
	March 31, 2019		March 31, 2018
Net realized gain (loss) on foreign currency forward contracts	$	18	$	–
Net change in unrealized appreciation (depreciation) on foreign currency forward contracts		78		–

Total net realized and unrealized gains (losses) on foreign currency forward contracts	$	96	$	–

8.	COMMITMENTS AND CONTINGENCIES

Commitments

The Company may enter into investment commitments either verbally or through signed commitment letters which in certain circumstances may be disclosed by the Company. In many circumstances, borrower acceptance and final terms are subject to transaction-related contingencies. These are disclosed as commitments upon execution of a final agreement. As of March 31, 2019, the Company believed that it had adequate financial resources to satisfy its unfunded commitments. The Company had the following unfunded commitments by investment types as of the dates indicated:


	March 31, 2019							December 31, 2018
	Commitment Expiration Date ⁽¹⁾		Unfunded Commitment		Fair Value⁽²⁾⁽³⁾			Commitment Expiration Date ⁽¹⁾		Unfunded Commitment		Fair Value⁽²⁾⁽³⁾
1st Lien/Senior Secured Debt
DocuTAP, Inc.		9/5/2019	$	4,680	$	–			–		–		–
DocuTAP, Inc.		9/5/2019		30,615		–			–		–		–
Legacy Buyer Corp.		10/24/2019		2,500		–			10/24/2019	$	2,500	$	–
VRC Companies, LLC		1/28/2020		1,062		(11	)		–		–		–
Businessolver.com, Inc.		5/15/2020		1,149		(23	)		5/15/2020		1,398		(28	)
SPay, Inc.		6/15/2020		5,285		(187	)		6/15/2020		5,663		(143	)
Hygiena Borrower LLC		6/29/2020		567		(11	)		6/29/2020		567		(11	)
Gastro Health, LLC		9/4/2020		5,062		(102	)		9/4/2020		5,062		(102	)
Diligent Corporation		12/19/2020		8,104		(101	)		12/19/2020		9,590		(120	)
Pathway Vet Alliance LLC		12/21/2020		1,543		(8	)		–		–		–
Brillio, LLC		2/6/2021		1,510		(15	)		–		–		–
Elemica, Inc.		7/7/2021		1,200		(15	)		7/7/2021		6,000		(75	)
Associations, Inc.		7/30/2021		1,514		(15	)		7/30/2021		1,892		(19	)
Netvoyage Corporation		3/24/2022		654		(11	)		3/24/2022		654		(8	)
VRC Companies, LLC		3/31/2022		64		(1	)		3/31/2022		86		(1	)
Diligent Corporation		4/14/2022		156		(2	)		4/14/2022		780		(10	)
Continuum Managed Services LLC		6/8/2022		2,220		(33	)		6/8/2022		2,220		(44	)
DDS USA Holding, Inc.		6/30/2022		1,079		(8	)		6/30/2022		1,079		(8	)
Xactly Corporation		7/29/2022		1,697		(25	)		7/29/2022		1,697		(25	)
Hygiena Borrower LLC		8/26/2022		380		(8	)		8/26/2022		380		(8	)
Lithium Technologies, Inc.		10/3/2022		2,684		(54	)		10/3/2022		2,684		(54	)
Datto, Inc.		12/7/2022		2,492		–			12/7/2022		2,492		(19	)
Businessolver.com, Inc.		5/15/2023		1,255		(25	)		5/15/2023		941		(19	)
Integral Ad Science, Inc.		7/19/2023		1,815		(36	)		7/19/2023		1,815		(36	)
Picture Head Midco LLC		8/31/2023		1,760		(31	)		8/31/2023		1,760		(36	)
Gastro Health, LLC		9/4/2023		2,000		(40	)		9/4/2023		2,000		(40	)
Empirix, Inc.		9/25/2023		1,300		(23	)		9/25/2023		1,300		(23	)
SPay, Inc.		6/17/2024		684		(24	)		6/17/2024		304		(8	)
Associations, Inc.		7/30/2024		587		(6	)		7/30/2024		587		(6	)
Fenergo Finance 3 Limited⁽³⁾		9/5/2024		1,683		(95	)		9/5/2024		1,744		(59	)
Fenergo Finance 3 Limited		9/5/2024		1,182		(24	)		9/5/2024		1,182		(24	)
iCIMS, Inc.		9/12/2024		1,868		(37	)		9/12/2024		1,868		(37	)
MMIT Holdings		11/15/2024		3,188		(64	)		11/15/2024		2,550		(51	)
Wrike, Inc.		12/31/2024		1,600		(32	)		12/31/2024		1,600		(32	)
Apptio, Inc.		1/10/2025		2,225		(44	)		1/10/2025		2,180		–
Mailgun Technologies, Inc.		3/26/2025		1,530		(31	)		–		–		–
Internet Truckstop Group		4/2/2025		21,762		–			–		–		–
Internet Truckstop Group		4/2/2025		1,755		–			–		–		–
VRC Companies, LLC		–		–		–			9/27/2019		872		(9	)
Picture Head Midco LLC		–		–		–			3/31/2019		2,540		(51	)
Diligent Corporation		–		–		–			8/3/2020		247		(3	)
Apptio, Inc.		–		–		–			1/10/2025		26,162		–
Total 1st Lien/Senior Secured Debt				122,411		(1,142	)				94,396		(1,109	)
2nd Lien/Senior Secured Debt
Hygiena Borrower LLC		6/29/2020	$	577	$	(10	)		6/29/2020	$	577	$	(10	)
Genesis Acquisition Co.		7/31/2020		1,778		(50	)		7/31/2020		1,777		(49	)
Total 2nd Lien/Senior Secured Debt				2,355		(60	)				2,354		(59	)
Total			$	124,766	$	(1,202	)			$	96,750	$	(1,168	)

⁽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⁾

A negative fair value was reflected as investments, at fair value in the Consolidated Statements of Assets and Liabilities. The negative fair value is the result of the capitalized discount on the loan.

⁽³⁾

Unfunded commitments denominated in currencies other than USD have been converted to USD using the applicable foreign currency exchange rate as of March 31, 2019 and December 31, 2018.

Contingencies

In the normal course of business, the Company enters into contracts that provide a variety of general indemnifications. Any exposure to the Company under these arrangements could involve future claims that may be made against the Company. Currently, no such claims exist or are expected to arise and, accordingly, the Company has not accrued any liability in connection with such indemnifications.

9.	NET ASSETS

Equity Issuances

There were no sales of the Company’s common stock during the three months ended March 31, 2019 and 2018.

Distributions

The following table reflects the distributions declared on shares of the Company’s common stock during the three months ended March 31, 2019:


Date Declared	Record Date	Payment Date	Amount Per Share
February 20, 2019	March 29, 2019	April 15, 2019	$0.45

The following table reflects the distributions declared on shares of the Company’s common stock during the three months ended March 31, 2018:


Date Declared	Record Date	Payment Date	Amount Per Share
February 21, 2018	March 30, 2018	April 16, 2018	$0.45

Dividend Reinvestment Plan

Concurrent with the IPO, the Company adopted a dividend reinvestment plan that provides for reinvestment of all cash distributions declared by the Board of Directors, unless a stockholder elects to “opt out” of the plan. As a result, if the Board of Directors declares a cash distribution, then the stockholders who have not “opted out” of the dividend reinvestment plan will have their cash distributions automatically reinvested in additional shares of common stock, rather than receiving the cash distribution.

The following table summarizes shares distributed pursuant to the dividend reinvestment plan during the three months ended March 31, 2019 to stockholders who had not opted out of the dividend reinvestment plan:


Date Declared	Record Date	Payment Date	Shares
October 30, 2018	December 31, 2018	January 15, 2019	39,591

The following table summarizes shares distributed pursuant to the dividend reinvestment plan during the three months ended March 31, 2018 to stockholders who had not opted out of the dividend reinvestment plan:


Date Declared	Record Date	Payment Date	Shares
October 31, 2017	December 29, 2017	January 16, 2018	23,824

10.

EARNINGS PER SHARE

The following information sets forth the computation of basic and diluted earnings per share for the three months ended March 31, 2019 and 2018:


	For the Three Months Ended
	March 31, 2019		March 31, 2018
Numerator for basic and diluted earnings per share - increase in net assets resulting from operations	$	2,215	$	18,451
Denominator for basic and diluted earnings per share - weighted average shares outstanding		40,261,057		40,150,518
Basic and diluted earnings per share	$	0.06	$	0.46

For the purpose of calculating diluted earnings per common share, the average closing price of the Company’s common stock for the three months ended March 31, 2019 and 2018 was less than the conversion price for the Convertible Notes outstanding as of March 31, 2019 and 2018, respectively. Therefore, for the three months ended March 31, 2019 and 2018, diluted earnings per share equals basic earnings per share because the underlying shares for the intrinsic value of the embedded options in the Convertible Notes were not dilutive.

11.

FINANCIAL HIGHLIGHTS

Below is the schedule of financial highlights of the Company for the three months ended March 31, 2019 and 2018:


	Three Months Ended March 31, 2019			Three Months Ended March 31, 2018
Per Share Data:⁽¹⁾
NAV, beginning of period	$	17.65		$	18.09
Net investment income		0.55			0.47
Net realized and unrealized gains (losses) ⁽²⁾		(0.51	)		–
Income tax provision, realized and unrealized gains		0.01			(0.01	)

Net increase (decrease) in net assets resulting from operations		0.05			0.46

Distributions declared from net investment income⁽³⁾		(0.45	)		(0.45	)

Total increase (decrease) in net assets		(0.40	)		0.01

NAV, end of period	$	17.25		$	18.10

Market price, end of period	$	20.54		$	19.13

Shares outstanding, end of period		40,267,216			40,154,489
Weighted average shares outstanding		40,261,057			40,150,518
Total return based on NAV⁽⁴⁾		(0.01)%			2.49%
Total return based on market value⁽⁵⁾		14.33%			(11.65)%

Ratio/Supplemental Data (all amounts in thousands except ratios):
Net assets, end of period	$	$694,746		$	726,711
Ratio of net expenses to average net assets⁽⁶⁾		8.11%			9.25%
Ratio of expenses (without incentive fees and interest and other debt expenses) to average net assets⁽⁶⁾		2.95%			3.44%
Ratio of interest and other debt expenses to average net assets⁽⁷⁾		4.88%			3.20%
Ratio of incentive fees to average net assets⁽⁷⁾		0.28%			2.61%
Ratio of total expenses to average net assets⁽⁶⁾		8.11%			9.25%
Ratio of net investment income (loss) to average net assets⁽⁶⁾⁽⁸⁾		12.98%			10.59%
Average debt outstanding	$	689,673		$	525,408
Average debt per share⁽⁹⁾	$	17.13		$	13.09
Portfolio turnover		8%			6%

⁽¹⁾

The per share data was derived by using the weighted average shares outstanding during the applicable period.

⁽²⁾

For the three months ended March 31, 2019 and 2018, the amount shown may not correspond with the aggregate amount for the period as it includes the effect of the timing of the distribution.

⁽³⁾

The per share data for distributions declared reflects the actual amount of distributions declared per share for the applicable period.

⁽⁴⁾

Total return based on NAV is calculated as the change in NAV per share during the respective periods, assuming dividends and distributions, if any, are reinvested in accordance with the Company’s dividend reinvestment plan.

⁽⁵⁾

Total return based on market value is calculated as the change in market value per share during the respective periods, assuming dividends and distributions, if any, are reinvested in accordance with the Company’s dividend reinvestment plan.

⁽⁶⁾

Annualized except for certain operating expenses.

⁽⁷⁾

Annualized.

⁽⁸⁾

Annualized except for certain components of other income.

⁽⁹⁾

Average debt per share is calculated as average debt outstanding divided by the weighted average shares outstanding during the applicable period.

12.

SUBSEQUENT EVENTS

Subsequent events after the Consolidated Statements of Assets and Liabilities date have been evaluated through the date the unaudited consolidated financial statements were issued. Other than the items discussed below, the Company has concluded that there is no impact requiring adjustment or disclosure in the consolidated financial statements.

On May 7, 2019, the Board of Directors declared a quarterly distribution of $0.45 per share payable on July 15, 2019 to holders of record as of June 28, 2019.

On May 8, 2019, the Company and Cal Regents each contributed $125,555 to the Senior Credit Fund, which was used by the Senior Credit Fund to repay in full all outstanding indebtedness, including all accrued and unpaid interest and fees, under the Asset Based Facility and to fund certain other related expenses that the Senior Credit Fund expects to incur in connection with its dissolution. The Asset Based Facility was then terminated and all liens securing the collateral under the Asset Based Facility were released. The Company funded its portion of the contributed amount through additional borrowings under its Revolving Credit Facility.

Following the repayment and termination, the Senior Credit Fund distributed each member’s pro rata share of all of its assets (other than cash and cash equivalents), primarily consisting of senior secured loans, to the members. The Company also assumed the obligation to fund outstanding unfunded commitments of the Senior Credit Fund that totaled $7,795 as of March 31, 2019, representing 50% of the Senior Credit Fund’s aggregate unfunded commitments. The pro rata portion of the assets received by the Company will become the Company’s assets and will be directly included in the Company’s consolidated financial statements and notes thereto, and will also be included for purposes of determining the Company’s asset coverage ratio. Based on March 31, 2019 balances, the assets to be received by the Company are approximately $221,769 and $215,728 at amortized cost and at fair value, respectively.

In connection with the repayment of the Asset Based Facility and the distribution of all of its loan assets, the Senior Credit Fund declared a $2,000 cash distribution to its members, representing estimated quarter-to-date net investment income, 50% of which will be paid to the Company.

The Company and Cal Regents have begun the process of dissolving the Senior Credit Fund. After the satisfaction of all remaining liabilities and the distribution of any remaining assets (including any amounts owed to it and not yet received), the Senior Credit Fund will be wound up and terminated.

ITEM 2.

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

The following discussion and other parts of this report contain forward-looking information that involves risks and uncertainties. References to “we,” “us,” “our,” and the “Company,” mean Goldman Sachs BDC, Inc. or Goldman Sachs BDC, Inc. together with its consolidated subsidiaries, as the context may require. The terms “GSAM,” our “Adviser” or our “Investment Adviser” refer to Goldman Sachs Asset Management, L.P., a Delaware limited partnership. The term “Group Inc.” refers to The Goldman Sachs Group, Inc. “GS & Co.” refers to Goldman Sachs & Co. LLC and its predecessors. The term “Goldman Sachs” refers to Group Inc., together with GS & Co., GSAM and its other subsidiaries and affiliates. The discussion and analysis contained in this section refers to our financial condition, results of operations and cash flows. The information contained in this section should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this report. Please see “Cautionary Statement Regarding Forward-Looking Statements” for a discussion of the uncertainties, risks and assumptions associated with this discussion and analysis. Our actual results could differ materially from those anticipated by such forward-looking information due to factors discussed under “Cautionary Statement Regarding Forward-Looking Statements” appearing elsewhere in this report.

OVERVIEW

We are a specialty finance company focused on lending to middle-market companies. We are a closed-end management investment company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “Investment Company Act”). In addition, we have elected to be treated, and expect to qualify annually, as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our taxable year ended December 31, 2013. From our formation in 2012 through March 31, 2019, we originated more than $3.25 billion in aggregate principal amount of debt and equity investments prior to any subsequent exits and repayments. We seek to generate current income and, to a lesser extent, capital appreciation primarily through direct originations of secured debt, including first lien, unitranche, including last-out portions of such loans, and second lien debt, and unsecured debt, including mezzanine debt, as well as through select equity investments.

“Unitranche” loans are first lien loans that may extend deeper in a company’s capital structure than traditional first lien debt and may provide for a waterfall of cash flow priority between different lenders in the unitranche loan. In a number of instances, we may find another lender to provide the “first-out” portion of such loan and retain the “last-out” portion of such loan, in which case, the “first-out” portion of the loan would generally receive priority with respect to payment of principal, interest and any other amounts due thereunder over the “last-out” portion that we would continue to hold. In exchange for the greater risk of loss, the “last-out” portion generally earns a higher interest rate than the “first-out” portion. We use the term “mezzanine” to refer to debt that ranks senior only to a borrower’s equity securities and ranks junior in right of payment to all of such borrower’s other indebtedness. We may make multiple investments in the same portfolio company.

We invest primarily in U.S. middle-market companies, which we believe are underserved by traditional providers of capital such as banks and the public debt markets. In this report, we generally use the term “middle market companies” to refer to companies with between $5 million and $200 million of annual earnings before interest expense, income tax expense, depreciation and amortization (“EBITDA”) excluding certain one-time, and non-recurring items that are outside the operations of these companies. However, we may from time to time invest in larger or smaller companies. We generate revenues primarily through receipt of interest income from the investments we hold. In addition, we may generate income from various loan origination and other fees, dividends on direct equity investments and capital gains on the sales of investments. Fees received from portfolio companies (directors’ fees, consulting fees, administrative fees, tax advisory fees and other similar compensation) are paid to us, unless, to the extent required by applicable law or exemptive relief therefrom, we only receive our allocable portion of such fees when invested in the same portfolio company as another client account managed by our Investment Adviser (including Goldman Sachs Private Middle Market Credit LLC (“GS PMMC”), Goldman Sachs Private Middle Market Credit II LLC (“GS PMMC II”) and Goldman Sachs Middle Market Lending Corp. (“GS MMLC”), collectively with other client accounts managed by our Investment Adviser, the “Accounts”). The companies in which we invest use our capital for a variety of purposes, including to support organic growth, fund acquisitions, make capital investments or refinance indebtedness.

Our origination strategy focuses on leading the negotiation and structuring of the loans or securities in which we invest and holding the investments in our portfolio to maturity. In many cases, we are the sole investor in the loan or security in our portfolio. Where there are multiple investors, we generally seek to control or obtain significant influence over the rights of investors in the loan or security. We generally seek to make investments that have maturities between three and ten years and range in size between $10 million and $75 million, although we may make larger or smaller investments on occasion.

For a discussion of the competitive landscape we face, please see “Item 1A. Risk Factors–Risks Relating to Our Business and Structure–We operate in a highly competitive market for investment opportunities” and “Item 1. Business–Competitive Advantages” in our annual report on Form 10-K for the year ended December 31, 2018.

KEY COMPONENTS OF OPERATIONS

Investments

Our level of investment activity can and does vary substantially from period to period depending on many factors, including the amount of debt and equity capital available to middle-market companies, the level of merger and acquisition activity for such companies, the general economic environment, 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 Investment Company 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 Securities and Exchange Commission (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.

Revenues

We generate revenues 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”) income. The principal amount of the debt investments and any accrued but unpaid interest generally becomes due at the maturity date.

We generate revenues primarily through receipt of interest income from the investments we hold. In addition, we may generate revenue in the form of commitment, origination, structuring, syndication, exit fees or diligence fees, fees for providing managerial assistance and consulting fees. Portfolio company fees (directors’ fees, consulting fees, administrative fees, tax advisory fees and other similar compensation) will be paid to us, unless, to the extent required by applicable law or exemptive relief, if any, therefrom, we receive our allocable portion of such fees when invested in the same portfolio company as other Accounts, which other Accounts could receive their allocable portion of such fee. We do not expect to receive material fee income as it is not our principal investment strategy. We record contractual prepayment premiums on loans and debt securities as interest income.

Expenses

Our primary operating expenses include the payment of the Management Fee and the Incentive Fee to the Investment Adviser, legal and professional fees, interest and other debt expenses and other operating and overhead related expenses. The Management Fee and Incentive Fee compensate our Investment Adviser for its work in identifying, evaluating, negotiating, closing and monitoring our investments. We bear all other costs and expenses of our operations and transactions in accordance with our investment management agreement (as amended and restated as of June 15, 2018, the “Investment Management Agreement”) and administration agreement (“Administration Agreement”), including those relating to:

•

our operational and organizational expenses;

•

fees and expenses, including travel expenses, incurred by our Investment Adviser or payable to third parties related to our investments, including, among others, professional fees (including the fees and expenses of consultants and experts) and fees and expenses from evaluating, monitoring, researching and performing due diligence on investments and prospective investments;

•

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

•

fees and expenses incurred by us in connection with membership in investment company organizations;

•

brokers’ commissions;

•

the expenses of and fees for registering or qualifying our shares for sale and of maintaining our registration and registering us as a broker or a dealer;

•

fees and expenses associated with calculating our net asset value (“NAV”) (including the costs and expenses of any independent valuation firm);

•

legal, auditing or accounting expenses;

•

taxes or governmental fees;

•

the fees and expenses of our administrator, transfer agent or sub-transfer agent;

•

the cost of preparing stock certificates or any other expenses, including clerical expenses of issue, redemption or repurchase of our shares;

•

the fees and expenses of our directors who are not affiliated with our Investment Adviser;

•

the cost of preparing and distributing reports, proxy statements and notices to our stockholders, the SEC and other regulatory authorities;

•

costs of holding stockholder meetings;

•

listing fees;

•

the fees or disbursements of custodians of our assets, including expenses incurred in the performance of any obligations enumerated by our certificate of incorporation or bylaws insofar as they govern agreements with any such custodian;

•

insurance premiums; and

•

costs incurred in connection with any claim, litigation, arbitration, mediation, government investigation or dispute in connection with our business and the amount of any judgment or settlement paid in connection therewith, or the enforcement of our rights against any person and indemnification or contribution expenses payable by us to any person and other extraordinary expenses not incurred in the ordinary course of our business.

We expect our general and administrative expenses to be relatively stable or decline as a percentage of total assets during periods of asset growth and to increase during periods of asset declines. Costs relating to future offerings of securities would be incremental.

Leverage

Our senior secured revolving credit agreement (as amended, the “Revolving Credit Facility”) with SunTrust Bank, as administrative agent, and Bank of America, N.A., as syndication agent, and our 4.50% Convertible Notes due 2022 (the “Convertible Notes”) allow us to borrow money and lever our investment portfolio, subject to the limitations of the Investment Company Act, with the objective of increasing our yield. This is known as “leverage” and could increase or decrease returns to our stockholders. The use of leverage involves significant risks. On June 15, 2018, our stockholders approved the application of the reduced asset coverage requirements in Section 61(a)(2) of the Investment Company Act to us. As a result of this approval, we are now permitted to borrow amounts such that our asset coverage ratio, as defined in the Investment Company Act, is at least 150% after such borrowing (if certain requirements are met), rather than 200%, as previously required. As of March 31, 2019 and December 31, 2018, our asset coverage ratio based on the aggregate amount outstanding of our senior securities was 197% and 206%, respectively.

Certain trading practices and investments, such as reverse repurchase agreements, may be considered borrowings or involve leverage and thus may be subject to Investment Company Act restrictions. In accordance with applicable SEC staff guidance and interpretations, when we engage in such transactions, instead of maintaining an asset coverage ratio of at least 150% (if certain requirements are met), we may segregate or earmark liquid assets, or enter into an offsetting position, in an amount at least equal to our exposure, on a mark-to-market basis, to such transactions (as calculated pursuant to requirements of the SEC). Short-term credits necessary for the settlement of securities transactions and arrangements with respect to securities lending will not be considered borrowings for these purposes. Practices and investments that may involve leverage but are not considered borrowings are not subject to the Investment Company Act’s asset coverage requirement, and we will not otherwise segregate or earmark liquid assets or enter into offsetting positions for such transactions. The amount of leverage that we employ will depend on our Investment Adviser’s and our board of directors’ (the “Board of Directors”) assessment of market conditions and other factors at the time of any proposed borrowing.

PORTFOLIO AND INVESTMENT ACTIVITY

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


	As of
	March 31, 2019							December 31, 2018
	Amortized Cost		Fair Value		Percentage of Total Portfolio at Fair Value			Amortized Cost		Fair Value		Percentage of Total Portfolio at Fair Value
	*(in millions)*							*(in millions)*
First Lien/Senior Secured Debt	$	823.30	$	814.54		58.0	%	$	738.63	$	729.60		53.0	%
First Lien/Last-Out Unitranche		108.36		101.09		7.2	%		114.00		106.88		7.8	%
Second Lien/Senior Secured Debt		304.39		291.03		20.7	%		411.55		391.93		28.5	%
Unsecured Debt		6.71		6.70		0.5	%		6.71		6.70		0.5	%
Preferred Stock		41.85		44.87		3.2	%		16.85		21.53		1.6	%
Common Stock		67.05		50.94		3.6	%		37.82		22.34		1.6	%
Investment Funds & Vehicles		100.00		95.93		6.8	%		100.00		96.46		7.0	%

Total Investments	$	1,451.66	$	1,405.10		100.0	%	$	1,425.56	$	1,375.44		100.0	%

As of March 31, 2019 and December 31, 2018, the weighted average yield by asset type of our total portfolio at amortized cost and fair value, was as follows:


	As of
	March 31, 2019						December 31, 2018
	Amortized Cost			Fair Value			Amortized Cost			Fair Value
Weighted Average Yield⁽¹⁾
First Lien/Senior Secured Debt⁽²⁾		10.3	%		10.8	%		10.4	%		11.0	%
First Lien/Last-Out Unitranche^{(2) (3)}		6.1			6.2			6.0			6.5
Second Lien/Senior Secured Debt⁽²⁾		10.8			11.6			9.7			10.4
Unsecured Debt⁽²⁾		11.6			11.9			11.7			11.9
Preferred Stock⁽⁴⁾		–			–			–			–
Common Stock⁽⁴⁾		–			–			–			–
Investment Funds & Vehicles⁽⁵⁾		10.6			10.9	%		11.2			11.4
Total Portfolio		9.3	%		9.9	%		9.5	%		10.1	%

⁽¹⁾

The weighted average yield of our portfolio does not represent the total return to our stockholders.

⁽²⁾

Computed based on (a) the annual actual interest rate or yield earned plus amortization of fees and discounts on the performing debt and other income producing investments as of the reporting date, divided by (b) the total investments (including investments on non-accrual and non-income producing investments) at amortized cost or fair value, respectively. This calculation excludes exit fees that are receivable upon repayment of certain loan investments.

⁽³⁾

The calculation includes incremental yield earned on the “last-out” portion of the unitranche loan investments.

⁽⁴⁾

Computed based on (a) the stated coupon rate, if any, for each income-producing investment, divided by (b) the total investments (including investments on non-accrual and non-income producing investments) at amortized cost or fair value, respectively.

⁽⁵⁾

Computed based on (a) the net investment income earned from the Senior Credit Fund, LLC (the “Senior Credit Fund”) for the respective trailing twelve months ended on the measurement date, which may include dividend income and loan origination and structuring fees, divided by (b) our average member’s equity at cost and fair value, adjusted for equity contributions.

As of March 31, 2019, the total portfolio weighted average yield measured at amortized cost and fair value was 9.3% and 9.9%, respectively, which decreased from 9.5% and 10.1%, respectively, at December 31, 2018. Within Second Lien/Senior Secured Debt, the increase in weighted average yield at amortized cost and fair value was primarily driven by the exchange of our second lien investment in ASC Acquisition Holdings, LLC for preferred and common equity.

The following table presents certain selected information regarding our investment portfolio as of March 31, 2019 and December 31, 2018:


	As of
	March 31, 2019		December 31, 2018
Number of portfolio companies⁽¹⁾		78		72
Percentage of performing debt bearing a floating rate⁽²⁾		96.3%		96.6%
Percentage of performing debt bearing a fixed rate⁽²⁾⁽³⁾		3.7%		3.4%
Weighted average yield on debt and income producing investments, at amortized cost⁽⁴⁾		10.7%		10.9%
Weighted average yield on debt and income producing investments, at fair value⁽⁴⁾		11.1%		11.3%
Weighted average leverage (net debt/EBITDA)⁽⁵⁾		5.3x		5.6x
Weighted average interest coverage⁽⁵⁾		2.2x		2.2x
Median EBITDA⁽⁵⁾	$	25.48 million	$	26.87 million

⁽¹⁾

Includes the Senior Credit Fund as a single portfolio company. For details on the portfolio companies held within the Senior Credit Fund, refer to “Senior Credit Fund, LLC–Selected Financial Data.”

⁽²⁾

Measured on a fair value basis. Excludes investments, if any, placed on non-accrual.

⁽³⁾

Includes income producing preferred stock investments.

⁽⁴⁾

Computed based on (a) the annual actual interest rate or yield earned plus amortization of fees and discounts on the performing debt and other income producing investments as of the reporting date, divided by (b) the total performing debt and other income producing investments (excluding investments on non-accrual).

⁽⁵⁾

For a particular portfolio company, we calculate the level of contractual indebtedness net of cash (“net debt”) owed by the portfolio company and compare that amount to measures of cash flow available to service the net debt. To calculate net debt, we include debt that is both senior and pari passu to the tranche of debt owned by us but exclude debt that is legally and contractually subordinated in ranking to the debt owned by us. We believe this calculation method assists in describing the risk of our portfolio investments, as it takes into consideration contractual rights of repayment of the tranche of debt owned by us relative to other senior and junior creditors of a portfolio company. We typically calculate cash flow available for debt service at a portfolio company by taking EBITDA for the trailing twelve month period. Weighted average net debt to EBITDA is weighted based on the fair value of our debt investments and excluding investments where net debt to EBITDA may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue. The weighted average net debt to EBITDA calculation for the Company includes its exposure to underlying debt investments in the Senior Credit Fund.

For a particular portfolio company, we also calculate the level of contractual interest expense owed by the portfolio company, and compare that amount to EBITDA (“interest coverage ratio”). We believe this calculation method assists in describing the risk of our portfolio investments, as it takes into consideration contractual interest obligations of the portfolio company. Weighted average interest coverage is weighted based on the fair value of our performing debt investments, including our exposure to underlying debt investments in the Senior Credit Fund and excluding investments where interest coverage may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.

Median EBITDA is based on our debt investments, including our exposure to underlying debt investments in the Senior Credit Fund and excluding investments where net debt to EBITDA may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.

Portfolio company statistics are derived from the most recently available financial statements of each portfolio company as of the reported end date. Statistics of the portfolio companies have not been independently verified by us and may reflect a normalized or adjusted amount.

As of March 31, 2019 and December 31, 2018, investments where net debt to EBITDA may not be the appropriate measure of credit risk represented 20.0% and 18.3%, respectively, of total debt investments, including our investment in the Senior Credit Fund, at fair value. Portfolio company statistics are derived from the most recently available financial statements of each portfolio company as of the respective reported end date. Portfolio company statistics have not been independently verified by us and may reflect a normalized or adjusted amount.

Floating rates are primarily London InterBank Offered Rate (“LIBOR”) plus a spread.

Our Investment Adviser monitors our portfolio companies on an ongoing basis. It monitors the financial trends of each portfolio company to determine if it is meeting its respective business plan and to assess the appropriate course of action for each company. Our Investment Adviser 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.

As part of the monitoring process, our Investment Adviser also employs an investment rating system to categorize our investments. In addition to various risk management and monitoring tools, our Investment Adviser grades the credit risk of all investments on a scale of 1 to 4 no less frequently than quarterly. This system is intended primarily to reflect the underlying risk of a portfolio investment relative to our initial cost basis in respect of such portfolio investment (e.g., at the time of origination or acquisition), although it may also take into account under certain circumstances the performance of the portfolio company’s business, the collateral coverage of the investment and other relevant factors. The grading system is as follows:

•

investments with a grade of 1 involve the least amount of risk to our initial cost basis. The trends and risk factors for this investment since origination or acquisition are generally favorable, which may include the performance of the portfolio company or a potential exit;

•

investments with a grade of 2 involve a level of risk to our initial cost basis that is similar to the risk to our initial cost basis at the time of origination or acquisition. This portfolio company is generally performing as expected and the risk factors to our ability to ultimately recoup the cost of our investment are neutral to favorable. All investments or acquired investments in new portfolio companies are initially assessed a grade of 2;

•

investments with a grade of 3 indicate that the risk to our ability to recoup the initial cost basis of such investment has increased materially since origination or acquisition, including as a result of factors such as declining performance and non-compliance with debt covenants; however, payments are generally not more than 120 days past due; and

•

investments with a grade of 4 indicate that the risk to our ability to recoup the initial cost basis of such investment has substantially increased since origination or acquisition, and the portfolio company likely has materially declining performance. For debt investments with an investment grade of 4, in most cases, most or all of the debt covenants are out of compliance and payments are substantially delinquent. For investments graded 4, it is anticipated that we will not recoup our initial cost basis and may realize a substantial loss of our initial cost basis upon exit.

Our Investment Adviser grades the investments in our portfolio at least quarterly and it is possible that the grade of a portfolio investment may be reduced or increased over time. For investments graded 3 or 4, our Investment Adviser enhances its level of scrutiny over the monitoring of such portfolio company. The following table shows the composition of our portfolio on the 1 to 4 grading scale as of March 31, 2019 and December 31, 2018:


	As of
	March 31, 2019					December 31, 2018
Investment Performance Rating	Fair Value		Percentage of Total Portfolio at Fair Value			Fair Value		Percentage of Total Portfolio at Fair Value
	*(in* *millions)*					*(in* *millions)*
Grade 1	$	95.52		6.8	%	$	87.76		6.4	%
Grade 2		1,188.04		84.6			1,138.12		82.8
Grade 3		71.75		5.1			60.93		4.4
Grade 4		49.79		3.5			88.63		6.4

Total Investments	$	1,405.10		100.0	%	$	1,375.44		100.0	%

The decrease in investments with a grade 4 investment performance rating as of March 31, 2019 compared to December 31, 2018 was primarily due to investments with an aggregate fair value of $39.58 million as of December 31, 2018 being exchanged for common and preferred equity, partially offset by one investments with an aggregate fair value of $0.94 million being downgraded from grade 3 investment performance rating as a result of being placed on non-accrual status due to financial underperformance. The increase in investments with a grade 3 investment performance rating as of March 31, 2019 compared to December 31, 2018 was driven by investments with an aggregate fair value of $32.17 million being downgraded from a grade 2 rating due to declining financial performance, partially offset by the aforementioned downgrade and one investment with a fair value of $5.85 million as of December 31, 2018 being exchanged for common and preferred equity. The increase in investments with a grade 1 investment performance rating as of March 31, 2019 compared to December 31, 2018 was driven by investments with an aggregate fair value of $66.45 million being upgraded due to potential exits, partially offset by the repayment of one investment with a fair value of $59.05 million as of December 31, 2018.

The following table shows the amortized cost of our performing and non-accrual investments as of March 31, 2019 and December 31, 2018:


	As of
	March 31, 2019					December 31, 2018
	Amortized Cost		Percentage of Total Portfolio at Amortized Cost			Amortized Cost		Percentage of Total Portfolio at Amortized Cost
	*(in* *millions)*					*(in* *millions)*
Performing	$	1,385.67		95.5	%	$	1,306.55		91.7	%
Non-accrual		65.99		4.5			119.01		8.3

Total Investments	$	1,451.66		100.0	%	$	1,425.56		100.0	%

The following table shows our investment activity for the three months ended March 31, 2019 and 2018 by investment type:


	For the Three Months Ended
	March 31, 2019		March 31, 2018
	*($ in millions)*
New investments committed at cost:
Gross originations	$	155.49	$	67.23
Less: Syndications⁽¹⁾		–		–

Net amount of new investments committed at cost:	$	155.49	$	67.23
Amount of investments committed at cost⁽²⁾:
First Lien/Senior Secured Debt	$	126.64	$	17.22
First Lien/Last-Out Unitranche		–		13.01
Second Lien/Senior Secured Debt		9.85		34.14
Unsecured Debt		–		1.56
Preferred Stock		19.00		–
Common Stock		–		1.30
Investment Funds & Vehicles		–		–

Total	$	155.49	$	67.23

Proceeds from investments sold or repaid⁽¹⁰⁾:
First Lien/Senior Secured Debt	$	13.13	$	4.34
First Lien/Last-Out Unitranche		0.05		51.38
Second Lien/Senior Secured Debt		64.60		20.84
Unsecured Debt		–		–
Preferred Stock		–		–
Common Stock		–		2.15
Investment Funds & Vehicles		–		–

Total	$	77.78	$	78.71

Net increase (decrease) in portfolio	$	77.71	$	(11.48	)

Number of new portfolio companies with new investment commitments⁽³⁾		7		2
Total new investment commitment amount in new portfolio companies⁽³⁾	$	101.04	$	10.74
Average new investment commitment amount in new portfolio companies⁽³⁾	$	14.43	$	5.37
Number of existing portfolio companies with new investment commitments⁽³⁾		4		9
Total new investment commitment amount in existing portfolio companies⁽³⁾	$	54.45	$	56.49
Weighted average remaining term for new investment commitments (in years)⁽³⁾⁽⁴⁾		5.8		5.4
Percentage of new debt investment commitments at floating interest rates^(3)(11)		100.0%		96.6%
Percentage of new debt investment commitments at fixed interest rates^(3)(5)(11)		–		3.4%
Weighted average yield on new debt and income producing investment commitments⁽²⁾⁽³⁾⁽⁶⁾		8.8%		12.1%
Weighted average yield on new investment commitments⁽²⁾⁽³⁾⁽⁷⁾		7.7%		11.9%
Weighted average yield on debt and income producing investments sold or paid down⁽¹⁰⁾⁽⁸⁾		11.0%		10.1%
Weighted average yield on investments sold or paid down⁽¹⁰⁾⁽⁹⁾		10.4%		9.8%

⁽¹⁾

Only includes syndications that occurred at the initial close of the investment.

⁽²⁾

Net of capitalized fees, expenses and original issue discount (“OID”) that occurred at the initial close of the investment.

⁽³⁾

May include positions originated during the period but not held at the reporting date.

⁽⁴⁾

Calculated as of the end of the relevant period and the maturity date of the individual investments.

⁽⁵⁾

May include preferred stock investments.

⁽⁶⁾

Computed based on (a) the annual actual interest rate on new debt and income producing investment commitments divided by (b) the total new debt and income producing investment commitments. The calculation includes incremental yield earned on the “last-out” portion of the unitranche loan investments and excludes investments that are non-accrual. The annual actual interest rate used is as of the respective quarter end date when the investment activity occurred.

⁽⁷⁾

Computed based on (a) the annual actual interest rate on new investment commitments divided by (b) the total new investment commitments (including investments on non-accrual and non-income producing investments). The calculation includes incremental yield earned on the “last-out” portion of the unitranche loan investments. The annual actual interest rate used is as of the respective quarter end date when the investment activity occurred.

⁽⁸⁾

Computed based on (a) the annual actual interest rate on debt and income producing investments sold or paid down, divided by (b) the total debt and income producing investments sold or paid down. The calculation includes incremental yield earned on the “last-out” portion of the unitranche loan investments and excludes prepayment premiums earned on exited investments and investments that are on non-accrual.

⁽⁹⁾

Computed based on (a) the annual actual interest rate on investments sold or paid down, divided by (b) the total investments sold or paid down (including investments on non-accrual and non-income producing investments). The calculation includes incremental yield earned on the “last-out” portion of the unitranche loan investments and excludes prepayment premiums earned on exited investments.

⁽¹⁰⁾

Excludes unfunded commitments that may have expired or otherwise been terminated without receipt of cash proceeds or other consideration.

⁽¹¹⁾

Computed based on amount of investments committed at cost.

RESULTS OF OPERATIONS

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


	For the Three Months Ended
	March 31, 2019			March 31, 2018
	*(in millions)*
Total investment income	$	36.53		$	35.54
Net expenses		(13.81	)		(16.52	)

Net investment income (loss) before taxes		22.72			19.02
Income tax expense, including excise tax		(0.44	)		(0.28	)

Net investment income (loss) after taxes		22.28			18.74
Net realized gain (loss) on investments		(24.72	)		1.67
Net realized gain (loss) on foreign currency transactions		0.01			–
Net unrealized appreciation (depreciation) on investments		3.56			(1.51	)
Net unrealized appreciation (depreciation) on foreign currency forward contracts and translations		0.88			–
Income tax provision, realized gain		–			(0.45	)
Income tax provision, unrealized gain		0.20			–

Net increase in net assets resulting from operations	$	2.21		$	18.45

Net increase in net assets resulting from operations can vary from period to period as a result of various factors, including acquisitions, the level of new investment commitments, the recognition of realized gains and losses and changes in unrealized appreciation and depreciation on the investment portfolio. As a result, comparisons may not be meaningful.

Investment Income


	For the Three Months Ended
	March 31, 2019		March 31, 2018
	*(in millions)*
Interest		32.18	$	30.18
Dividend income		2.48		2.81
Payment-in-kind		1.21		2.31
Other income		0.66		0.24

Total investment income	$	36.53	$	35.54

Interest

Interest from investments, which includes prepayment premiums and accelerated accretion of upfront loan origination fees and unamortized discounts, increased from $30.18 million for the three months ended March 31, 2018 to $32.18 million for the three months ended March 31, 2019. The increase is primarily due to an increase in recurring interest income due to an increase in the size of our portfolio and earning exit fees on certain investments. The increase was partially offset by certain investments placed on non-accrual status. Included in interest for the three months ended March 31, 2019 and 2018 is $0.65 million and $0.48 million, respectively, in prepayment premiums, $1.04 million and $0.83 million, respectively, in accelerated accretion of upfront loan origination fees and unamortized discounts, and $0.88 million and $0.00 million, respectively, for exit fees on investments.

Dividend income

Dividend income decreased from $2.81 million for the three months ended March 31, 2018 to $2.48 million for the three months ended March 31, 2019 primarily as a result of a decrease in distributions from the Senior Credit Fund during the three months ended March 31, 2019. The dividend income from Senior Credit Fund decreased from $2.80 million for the three months ended March 31, 2018 to $2.45 million for the three months ended March 31, 2019.

Payment-in-kind

Payment-in-kind (“PIK”) income from investments decreased from $2.31 million for the three months ended March 31, 2018 to $1.21 million for the three months ended March 31, 2019. The decrease is primarily driven by one investment in NTS Communication, Inc. being on non-accrual status.

Other income

Other income increased from $0.24 million for the three months ended March 31, 2018 to $0.66 million for the three months ended March 31, 2019 primarily due to an increase in amendment fee income earned on certain investments and the increase in administrative agent fees earned as a result of increase in size of our portfolio.

Expenses


	For the Three Months Ended
	March 31, 2019		March 31, 2018
	*(in millions)*
Interest and other debt expenses	$	8.45	$	5.72
Management fees		3.54		4.80
Incentive fees		0.49		4.68
Professional fees		0.64		0.67
Administration, custodian and transfer agent fees		0.24		0.23
Directors’ fees		0.11		0.10
Other expenses		0.34		0.32

Total Expenses	$	13.81	$	16.52

Interest and other debt expenses

Interest and other debt expense increased from $5.72 million for the three months ended March 31, 2018 to $8.45 million for the three months ended March 31, 2019 primarily due to the increase in weighted average interest rate for the Revolving Credit Facility from 3.63% to 4.38% and the increase in average daily borrowings under the Revolving Credit Facility from $410.41 to $534.67 million. In addition, costs associated with the Convertible Notes increased from $1.51 million for the three months ended March 31, 2018 to $2.15 million for the three months ended March 31, 2019 due to the incremental issuance of $40.00 million aggregate principal amount of Convertible Notes on July 2, 2018.

Management Fees and Incentive Fees

Management Fees decreased from $4.80 million for the three months ended March 31, 2018 to $3.54 million for the three months ended March 31, 2019 as a result of the reduction in the Management Fee from an annual rate of 1.50% to an annual rate of 1.00% effective on June 15, 2018, partially offset by an increase in gross assets, excluding cash or cash equivalents. Incentive Fees decreased from $4.68 million for the three months ended March 31, 2018 to $0.49 million for the three months ended March 31, 2019 primarily due to net capital losses on certain portfolio companies.

Professional fees and other general and administrative expenses

Professional fees and other general and administrative expenses for the three months ended March 31, 2019 remained relatively consistent as compared to the three months ended March 31, 2018.

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

The realized gains and losses on fully exited and partially exited portfolio companies for the three months ended March 31, 2019 and 2018 consisted of the following:


	For the Three Months Ended
	March 31, 2019			March 31, 2018
	*(in millions)*
ASC Acquisition Holdings, LLC	$	(24.72	)	$	–
myON, LLC		–			1.55
Global Tel*Link Corporation		–			0.14
Other, net		–			(0.02	)

Net realized gain (loss)	$	(24.72	)	$	1.67

For the three months ended March 31, 2019, net realized losses were primarily driven by our investment in ASC Acquisition Holdings, LLC whereby we exchanged our first lien/last-out unitranche debt and second lien debt for preferred and common equity which resulted in a realized loss of $24.72 million.

In connection with the proceeds received from the exit of our equity investment in myON, LLC, we recorded an income tax provision of $0.45 million for the three months ended March 31, 2018.

Any changes in fair value are recorded as a change in unrealized appreciation (depreciation) on investments. For further details on the valuation process, refer to “Critical Accounting Policies—Valuation of Portfolio Investments.” Net change in unrealized appreciation (depreciation) on investments for the three months ended March 31, 2019 and 2018 were as follows:


	For the Three Months Ended
	March 31, 2019			March 31, 2018
	*(in millions)*
Change in unrealized appreciation	$	19.22		$	3.97
Change in unrealized depreciation		(15.66	)		(5.48	)

Net change in unrealized appreciation (depreciation) on investments	$	3.56		$	(1.51	)

The change in unrealized appreciation (depreciation) on investments for the three months ended March 31, 2019 and 2018 consisted of the following:


	For the Three Months Ended
	March 31, 2019			March 31, 2018
	*(in millions)*
Portfolio Company:
Accuity Delivery Systems, LLC	$	0.39		$	–
Artesyn Embedded Technologies, Inc.		0.35			(0.10	)
ASC Acquisition Holdings, LLC		14.57			0.22
Avenue Stores, LLC		0.68			(0.49	)
Bolttech Mannings, Inc.		(0.38	)		(1.23	)
CB-HDT Holdings, Inc.		(3.45	)		(0.45	)
Conergy Asia & ME Pte. LTD.		–			0.87
Conergy Asia Holdings, Ltd.		–			(1.00	)
Continuum Managed Services LLC - Class B		0.39			0.23
Country Fresh Holdings, LLC		(6.86	)		(0.10	)
Datto, Inc.		0.26			(0.03	)
Diligent Corporation		(0.41	)		–
DiscoverOrg, LLC		(0.47	)		0.12
DuBois Chemicals, Inc.		(0.28	)		(0.01	)
Fenergo Finance 3 Limited		(0.47	)		–
Heligear Acquisition Co.		(0.02	)		(0.23	)
Infinity Sales Group		(0.57	)		0.25
Iracore International Holdings, Inc.		0.37			–
Kawa Solar Holdings Limited		0.32			0.15
NTS Communications, Inc.		(0.24	)		(0.43	)
Senior Credit Fund, LLC		(0.53	)		1.00
SF Home Décor, LLC		(0.03	)		0.18
SPay, Inc.		(0.18	)		–
US Med Acquisition, Inc.		0.36			(0.55	)
Viant Medical Holdings, Inc.		0.25			–
Wrike, Inc.		0.33			–
Zep Inc.		(0.73	)		0.05
Other, net⁽¹⁾		(0.09	)		0.04

Total	$	3.56		$	(1.51	)

⁽¹⁾

For the three months ended March 31, 2019 and 2018 other, net includes gross unrealized appreciation of $0.95 million and $0.90 million, respectively, and gross unrealized depreciation of $1.04 million and $0.86 million, respectively.

Net change in unrealized appreciation (depreciation) in our investments for the three months ended March 31, 2019 was primarily driven by the reversal of unrealized depreciation in connection with the aforementioned exchange with ASC Acquisition Holdings, LLC., partially offset by the unrealized depreciation in Country Fresh Holdings, LLC, which was placed on non-accrual status due to financial underperformance.

SENIOR CREDIT FUND, LLC

Overview

The Senior Credit Fund, an unconsolidated Delaware limited liability company, was formed on May 7, 2014 and commenced operations on October 1, 2014. We invest together with the Regents of the University of California (“Cal Regents, and collectively with us, the “Members”) through the Senior Credit Fund. The Senior Credit Fund’s principal purpose is to make investments, either directly or indirectly through Senior Credit Fund SPV I, LLC (“SPV I”) primarily in senior secured loans to middle-market companies. Each of us and Cal Regents has a 50% economic ownership in the Senior Credit Fund and each has subscribed to fund $100.00 million. Except under certain circumstances, contributions to the Senior Credit Fund cannot be redeemed. The Senior Credit Fund is managed by a six member board of managers, on which we and Cal Regents have equal representation. Investment decisions generally must be unanimously approved by a quorum of the board of managers. Establishing a quorum for the Senior Credit Fund’s board of managers requires at least four members to be present at a meeting, including at least two of our representatives and two of Cal Regents’ representatives. If there are five members present at a meeting, all three representatives of Cal Regents must be present to constitute a quorum. On August 24, 2018, we and Cal Regents, as the Members of the Senior Credit Fund, entered into an amendment to the amended and restated limited liability company agreement of the Senior Credit Fund to extend the investment period to December 19, 2018. We and Cal Regents are each responsible for sourcing the Senior Credit Fund’s investments. If the loan origination and structuring fees earned by the Senior Credit Fund (including directly or indirectly through SPV I or another vehicle) during a period exceed the Senior Credit Fund’s expenses (excluding interest and other debt expenses), such excess is paid as a fee to the Member(s) responsible for the origination of the loans pro rata in accordance with the total loan origination and structuring fees earned by the Senior Credit Fund with respect to the loans originated by such Member.

On February 27, 2019, the board of managers of the Senior Credit Fund authorized the liquidation and subsequent dissolution of the Senior Credit Fund and the pro-rata distribution of its assets and liabilities to the members of the Senior Credit Fund. Following the distribution of underlying assets and liabilities held by the Senior Credit Fund to its members, including us, the pro-rata portion of such assets and liabilities received by us will become our assets and liabilities and will be directly included in our consolidated financial statements and notes thereto, and will also be included for purposes of determining our asset coverage ratio. There can be no assurance that the liquidation of the Senior Credit Fund and related transactions will be effectuated, and such transactions will remain subject to any requisite approvals.

Selected Financial Data

As of March 31, 2019 and December 31, 2018, we and Cal Regents had subscribed to fund and contributed the following in the Senior Credit Fund:


	March 31, 2019				December 31, 2018
	Subscribed to fund		Contributed		Subscribed to fund		Contributed
	(in millions)				(in millions)
Company	$	100.00	$	100.00	$	100.00	$	100.00
Cal Regents		100.00		100.00		100.00		100.00

Total	$	200.00	$	200.00	$	200.00	$	200.00

As of March 31, 2019 and December 31, 2018, the Senior Credit Fund had total investments at fair value of $431.46 million and $451.80 million, respectively. As of March 31, 2019, the Senior Credit Fund had one portfolio company on non-accrual status. As of December 31, 2018, the Senior Credit Fund had one investment on non-accrual status. As of March 31, 2019 and December 31, 2018, the Senior Credit Fund had an investment in a money market fund managed by an affiliate of Group Inc. with a total fair value of $42.42 million and $5.29 million, respectively. In addition, the Senior Credit Fund had ten portfolio companies with unfunded commitments totaling $15.59 million as of March 31, 2019 and ten portfolio companies with unfunded commitments totaling $17.12 million as of December 31, 2018.

Below is a summary of the Senior Credit Fund’s portfolio (excluding an investment in a money market fund managed by an affiliate of Group Inc.) followed by a listing of the individual loans in the Senior Credit Fund’s portfolio as of March 31, 2019 and December 31, 2018:


	As of
	March 31, 2019		December 31, 2018
Number of portfolio companies		31		32
Total senior secured debt⁽¹⁾	$	463.44 million	$	484.41 million
Largest loan to a single borrower⁽¹⁾	$	29.77 million	$	29.85 million
Weighted average current interest rate on senior secured debt⁽²⁾		7.6%		7.7%
Percentage of performing debt bearing a floating rate⁽³⁾		100.0%		100.0%
Percentage of performing debt bearing a fixed rate⁽³⁾		–%		–%
Weighted average leverage (net debt/EBITDA)⁽⁴⁾		4.8x		4.8x
Weighted average interest coverage⁽⁴⁾		2.5x		2.4x
Median EBITDA⁽⁴⁾	$	48.05 million	$	52.70 million

⁽¹⁾

At par amount, including fully unfunded commitments.

⁽²⁾

Computed as (a) the annual stated interest rate on accruing senior secured debt divided by (b) total income producing senior secured debt at par amount, excluding fully unfunded commitments.

⁽³⁾

Measured on a fair value basis.

⁽⁴⁾

For a particular portfolio company of the Senior Credit Fund, we calculate the level of contractual indebtedness net of cash (“net debt”) owed by the portfolio company, and compare that amount to measures of cash flow available to service the net debt. To calculate net debt, we include debt that is both senior and pari passu to the tranche of debt owned by the Senior Credit Fund, but exclude debt that is legally and contractually subordinated in ranking to the debt owned by the Senior Credit Fund. We believe this calculation method assists in describing the risk of the Senior Credit Fund’s portfolio investments, as it takes into consideration contractual rights of repayment of the tranche of debt owned by the Senior Credit Fund relative to other senior and junior creditors of a portfolio company. We typically calculate cash flow available for debt service at a portfolio company by taking EBITDA for the trailing twelve month period.

For a particular portfolio company of the Senior Credit Fund, we also calculate the level of contractual interest expense owed by the portfolio company, and compare that amount to EBITDA (“interest coverage ratio”). We believe this calculation method assists in describing the risk of the Senior Credit Fund’s portfolio investments, as it takes into consideration contractual interest obligations of the portfolio company.

Median EBITDA is based on the Senior Credit Fund’s debt investments, excluding investments where net debt to EBITDA may not be the appropriate measure of credit risk, such as cash collateralized loans and investments that are underwritten and covenanted based on recurring revenue.

Portfolio company statistics are derived from the most recently available financial statements of each portfolio company of the Senior Credit Fund as of the respective reported end date. Statistics of the Senior Credit Fund’s portfolio companies have not been independently verified by us and may reflect a normalized or adjusted amount.

Senior Credit Fund Portfolio as of March 31, 2019


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value

1st Lien/Senior Secured Debt
3SI Security Systems, Inc.	Commercial Services & Supplies	8.36%	L + 5.75%; 1.00% Floor		06/16/2023	$	29.77	$	29.47		$	29.48
A Place For Mom, Inc.	Diversified Consumer Services	6.25%	L + 3.75%; 1.00% Floor		08/10/2024		17.82		17.80			17.37
AMCP Clean Acquisition Company, LLC	Commercial Services & Supplies	6.85%	L + 4.25%		06/16/2025		8.80		8.76			8.72
AMCP Clean Acquisition Company, LLC⁽¹⁾	Commercial Services & Supplies	6.89%	L + 4.25%		06/16/2025		2.13		0.82			0.81
Animal Supply Holdings, LLC^{(3) (5)}	Distributors	12.75%	L + 10.00% (incl. 2.50% PIK); 1.00% Floor		02/22/2022		7.61		7.49			7.44
Ansira Partners, Inc.	Media	8.25%	L + 5.75%; 1.00% Floor		12/20/2022		9.23		9.16			9.18
Ansira Partners, Inc.⁽¹⁾	Media	8.25%	L + 5.75%; 1.00% Floor		12/20/2022		0.57		0.14			0.14
ATX Networks Corp.	Communications Equipment	8.60%	L + 6.00%; 1.00% Floor		06/11/2021		0.95		0.93			0.89
ATX Networks Corp.	Communications Equipment	8.60%	L + 6.00%; 1.00% Floor		06/11/2021		14.89		14.83			14.00
Badger Sportswear, Inc.	Textiles, Apparel & Luxury Goods	7.00%	L + 4.50%; 1.00% Floor		09/11/2023		14.62		14.52			14.18
Barbri, Inc.	Media	6.74%	L + 4.25%; 1.00% Floor		12/01/2023		12.49		12.44			12.27
CST Buyer Company	Diversified Consumer Services	7.50%	L + 5.00%; 1.00% Floor		03/01/2023		18.37		18.02			18.15
CST Buyer Company^{(1) (2)}	Diversified Consumer Services		L + 5.00%; 1.00% Floor		03/01/2023		1.80		(0.03	)		(0.02	)
DBRS Limited	Capital Markets	7.88%	L + 5.25%; 1.00% Floor		03/04/2022		11.52		11.47			11.41
Drilling Info Holdings, Inc.	Oil & Gas	6.75%	L + 4.25%		07/30/2025		18.35		18.27			18.21
Drilling Info Holdings, Inc.^{(1) (2)}	Oil & Gas		L + 4.25%		07/30/2025		0.07		–			–
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		8.97		8.79			8.88
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		1.17		0.27			0.28
FWR Holding Corporation	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		1.13		1.11			1.12
FWR Holding Corporation⁽¹⁾	Hotels, Restaurants & Leisure	8.00%	L + 5.50%; 1.00% Floor		08/21/2023		1.79		1.76			1.77
GH Holding Company	Real Estate Management & Development	7.00%	L + 4.50%		02/28/2023		14.85		14.79			14.78
GI Revelation Acquisition LLC	Internet Software & Services	7.50%	L + 5.00%		04/16/2025		9.43		9.39			9.22
GK Holdings, Inc.	IT Services	8.60%	L + 6.00%; 1.00% Floor		01/20/2021		17.23		17.19			15.34
GlobalTranz Enterprises, Inc.	Road & Rail	6.50%	L + 4.00%		06/29/2025		21.89		21.79			21.78
GlobalTranz Enterprises, Inc.⁽¹⁾	Road & Rail	6.50%	L + 4.00%		06/29/2025		4.00		0.12			0.10
Halo Branded Solutions, Inc.	Commercial Services & Supplies	7.00%	L + 4.50%; 1.00% Floor		06/30/2025		10.48		10.38			10.27
Halo Branded Solutions, Inc.	Commercial Services & Supplies	7.00%	L + 4.50%; 1.00% Floor		06/30/2025		4.41		4.37			4.32
HC Group Holdings III, Inc.	Health Care Providers & Services	6.25%	L + 3.75%		04/07/2022		8.68		8.66			8.64
Hygiena Borrower LLC⁽³⁾	Life Sciences Tools & Services	6.60%	L + 4.00%; 1.00% Floor		08/26/2022		1.87		(0.02	)		(0.04	)
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor		08/26/2022		17.72		17.59			17.36
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services		L + 4.00%; 1.00% Floor		08/26/2022		0.29		–			(0.01	)
Jill Acquisition LLC	Textiles, Apparel & Luxury Goods	7.75%	L + 5.00%; 1.00% Floor		05/08/2022		13.80		13.74			13.57
Lattice Semiconductor Corporation	Semiconductors & Semiconductor Equipment	6.73%	L + 4.25%; 1.00% Floor		03/10/2021		8.27		8.19			8.29
Output Services Group, Inc.	Diversified Consumer Services	6.75%	L + 4.25%; 1.00% Floor		03/27/2024		6.96		6.93			6.39

Senior Credit Fund Portfolio as of March 31, 2019 (Continued)


Portfolio Company	Industry	Interest Rate ⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value
Output Services Group, Inc.^{(1) (2)}	Diversified Consumer Services		L + 4.25%; 1.00% Floor		03/27/2024	$	1.03	$	–		$	(0.09	)
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.50%	L + 4.00%		06/11/2023		6.53		6.51			6.51
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.50%	L + 4.00%		06/11/2023		1.87		1.87			1.87
Pharmalogic Holdings Corp.^{(1) (2)}	Health Care Equipment & Supplies		L + 4.00%		06/11/2023		3.54		(0.01	)		(0.01	)
Professional Physical Therapy⁽⁴⁾	Health Care Providers & Services		L + 7.50% (6.50% PIK); 1.00% Floor		12/16/2022		11.36		10.22			9.43
Regulatory DataCorp, Inc.	Diversified Financial Services	7.00%	L + 4.50%; 1.00% Floor		09/21/2022		4.95		4.95			4.85
SciQuest, Inc.	Internet Software & Services	6.50%	L + 4.00%; 1.00% Floor		12/28/2024		19.80		19.72			19.40
SMS Systems Maintenance Services, Inc.	IT Services	7.50%	L + 5.00%; 1.00% Floor		10/30/2023		14.66		14.61			11.28
Stackpath, LLC	Internet Software & Services	7.74%	L + 5.00%; 1.00% Floor		02/03/2023		16.70		16.59			15.03
Tronair Parent Inc.	Air Freight & Logistics	7.57%	L + 4.75%; 1.00% Floor		09/08/2023		13.65		13.56			13.31
U.S. Acute Care Solutions, LLC	Health Care Providers & Services	7.60%	L + 5.00%; 1.00% Floor		05/17/2021		12.71		12.64			12.64
VRC Companies, LLC⁽³⁾	Commercial Services & Supplies	9.00%	L + 6.50%; 1.00% Floor		03/31/2023		27.30		26.92			27.02
VRC Companies, LLC^{(1) (3)}	Commercial Services & Supplies	9.31%	L + 6.50%; 1.00% Floor		03/31/2022		1.41		0.87			0.88

Total 1st Lien/Senior Secured Debt									437.59			426.41

2nd Lien/Senior Secured Debt
GK Holdings, Inc.	IT Services	12.85%	L + 10.25%; 1.00% Floor		01/20/2022		6.00		5.94			4.80

Total 2nd Lien/Senior Secured Debt									5.94			4.80

Total Corporate Debt									443.53			431.22

Portfolio Company	Industry					Shares		Cost			Fair Value
Common Stock
Animal Supply Holdings, LLC^{(3) (6)}	Distributors						3,283	$	–		$	0.24

Total Common Stock									–			0.24

Total Investments								$	443.53		$	431.46

⁽⁺⁾

⁽¹⁾

⁽²⁾

⁽³⁾

We also holds an investment in this portfolio company.

⁽⁴⁾

The investment is on non-accrual status as of March 31, 2019.

⁽⁵⁾

The investment includes an exit fee that is receivable upon repayment of the loan.

⁽⁶⁾

Non-income producing security.

PIK – Payment-In-Kind

Senior Credit Fund Portfolio as of December 31, 2018


Portfolio Company	Industry	Interest Rate⁽⁺⁾		Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value

1st Lien/Senior Secured Debt⁽⁺⁾
3SI Security Systems, Inc.	Commercial Services & Supplies		8.54%	L + 5.75%; 1.00% Floor		06/16/2023	$	29.85	$	29.53		$	29.55
A Place For Mom, Inc.	Diversified Consumer Services		6.27%	L + 3.75%; 1.00% Floor		08/10/2024		17.86		17.85			17.86
AMCP Clean Acquisition Company, LLC	Commercial Services & Supplies		7.05%	L + 4.25%		06/16/2025		8.83		8.79			8.70
AMCP Clean Acquisition Company, LLC⁽¹⁾	Commercial Services & Supplies		6.93%	L + 4.25%		06/16/2025		2.13		0.83			0.80
Ansira Partners, Inc.	Media		8.27%	L + 5.75%; 1.00% Floor		12/20/2022		9.25		9.18			9.20
Ansira Partners, Inc.⁽¹⁾	Media		8.27%	L + 5.75%; 1.00% Floor		12/20/2022		0.57		0.14			0.14
ATX Networks Corp.	Communications Equipment		9.80%	L + 7.00% (Incl. 1.00% PIK); 1.00% Floor		06/11/2021		14.98		14.90			14.08
ATX Networks Corp.	Communications Equipment		9.80%	L + 7.00% (Incl. 1.00% PIK); 1.00% Floor		06/11/2021		0.95		0.94			0.90
Badger Sportswear, Inc.	Textiles, Apparel & Luxury Goods		7.02%	L + 4.50%; 1.00% Floor		09/11/2023		14.66		14.56			14.37
Barbri, Inc.	Media		6.60%	L + 4.25%; 1.00% Floor		12/01/2023		12.49		12.43			12.17
CST Buyer Company	Diversified Consumer Services		7.52%	L + 5.00%; 1.00% Floor		03/01/2023		18.67		18.29			18.44
CST Buyer Company^{(1) (2)}	Diversified Consumer Services			L + 5.00%; 1.00% Floor		03/01/2023		1.80		(0.04	)		(0.02	)
DBRS Limited	Capital Markets		7.96%	L + 5.25%; 1.00% Floor		03/04/2022		11.55		11.49			11.38
DiscoverOrg, LLC⁽³⁾	Software		7.03%	L + 4.50%; 1.00% Floor		08/25/2023		7.90		7.87			7.86
Drilling Info Holdings, Inc.	Oil & Gas		6.77%	L + 4.25%		07/30/2025		17.00		16.92			16.89
Drilling Info Holdings, Inc.^{(1) (2)}	Oil & Gas			L + 4.25%		07/30/2025		1.46		(0.01	)		(0.01	)
FWR Holding Corporation	Hotels, Restaurants & Leisure		8.26%	L + 5.75%; 1.00% Floor		08/21/2023		8.99		8.81			8.81
FWR Holding Corporation	Hotels, Restaurants & Leisure		8.26%	L + 5.75%; 1.00% Floor		08/21/2023		1.79		1.76			1.76
FWR Holding Corporation	Hotels, Restaurants & Leisure		8.26%	L + 5.75%; 1.00% Floor		08/21/2023		1.14		1.11			1.11
FWR Holding Corporation⁽¹⁾	Hotels, Restaurants & Leisure		10.25%	P + 4.75%; 2.00% Floor		08/21/2023		1.17		0.42			0.42
GH Holding Company	Real Estate Management & Development		7.02%	L + 4.50%		02/28/2023		14.89		14.83			14.81
GI Revelation Acquisition LLC	Internet Software & Services		7.52%	L + 5.00%		04/16/2025		9.46		9.42			9.28
GK Holdings, Inc.	IT Services		8.80%	L + 6.00%; 1.00% Floor		01/20/2021		17.28		17.23			15.73
GlobalTranz Enterprises, Inc.	Road & Rail		6.77%	L + 4.25%		06/29/2025		21.94		21.84			21.84
GlobalTranz Enterprises, Inc.^{(1) (2)}	Road & Rail			L + 4.25%		06/29/2025		4.00		–			(0.02	)
Halo Branded Solutions, Inc.	Commercial Services & Supplies		7.02%	L + 4.50%; 1.00% Floor		06/30/2025		10.50		10.40			10.19
Halo Branded Solutions, Inc.	Commercial Services & Supplies		7.02%	L + 4.50%; 1.00% Floor		06/30/2025		4.42		4.38			4.29
HC Group Holdings III, Inc.	Health Care Providers & Services		6.27%	L + 3.75%		04/07/2022		8.71		8.68			8.60
Hygiena Borrower LLC⁽³⁾	Life Sciences Tools & Services		6.80%	L + 4.00%; 1.00% Floor		08/26/2022		17.76		17.62			17.41
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services			L + 4.00%; 1.00% Floor		08/26/2022		0.29		(0.00	)		(0.01	)
Hygiena Borrower LLC^{(1) (2) (3)}	Life Sciences Tools & Services			L + 4.00%; 1.00% Floor		08/26/2022		1.87		(0.02	)		(0.04	)

Senior Credit Fund Portfolio as of December 31, 2018 (Continued)


Portfolio Company	Industry	Interest Rate⁽⁺⁾	Reference Rate and Spread ⁽⁺⁾	Maturity		Par Amount		Cost			Fair Value
Jill Acquisition LLC	Textiles, Apparel & Luxury Goods	7.53%	L + 5.00%; 1.00% Floor		05/08/2022	$	13.84	$	13.77		$	13.62
Lattice Semiconductor Corporation	Semiconductors & Semiconductor Equipment	6.63%	L + 4.25%; 1.00% Floor		03/10/2021		9.21		9.12			9.21
Output Services Group, Inc.	Diversified Consumer Services	6.77%	L + 4.25%; 1.00% Floor		03/27/2024		6.98		6.95			6.75
Output Services Group, Inc.^{(1) (2)}	Diversified Consumer Services		L + 4.25%; 1.00% Floor		03/27/2024		1.03		–			(0.03	)
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.52%	L + 4.00%		06/11/2023		6.54		6.53			6.53
Pharmalogic Holdings Corp.	Health Care Equipment & Supplies	6.52%	L + 4.00%		06/11/2023		1.88		1.87			1.87
Pharmalogic Holdings Corp.⁽¹⁾⁽²⁾	Health Care Equipment & Supplies		L + 4.00%		06/11/2023		3.54		(0.01	)		(0.01	)
Professional Physical Therapy⁽⁴⁾	Health Care Providers & Services		L + 7.50% PIK; 1.00% Floor		12/16/2022		11.26		10.28			9.35
Regulatory DataCorp, Inc.	Diversified Financial Services	7.02%	L + 4.50%; 1.00% Floor		09/21/2022		4.96		4.96			4.86
SciQuest, Inc.	Internet Software & Services	6.53%	L + 4.00%; 1.00% Floor		12/28/2024		19.85		19.76			19.45
SMS Systems Maintenance Services, Inc.	IT Services	7.52%	L + 5.00%; 1.00% Floor		10/30/2023		14.70		14.64			10.92
Stackpath, LLC	Internet Software & Services	7.59%	L + 5.00%; 1.00% Floor		02/03/2023		16.70		16.58			16.03
Tronair Parent Inc.	Air Freight & Logistics	7.56%	L + 4.75%; 1.00% Floor		09/08/2023		13.68		13.59			13.14
U.S. Acute Care Solutions, LLC	Health Care Providers & Services	7.52%	L + 5.00%; 1.00% Floor		05/14/2021		12.74		12.67			12.68
VRC Companies, LLC⁽³⁾	Commercial Services & Supplies	9.02%	L + 6.50%; 1.00% Floor		03/31/2023		27.36		26.97			27.09
VRC Companies, LLC^{(1) (3)}	Commercial Services & Supplies	9.45%	L + 6.50%; 1.00% Floor		03/31/2022		1.41		0.70			0.71

Total 1st Lien/Senior Secured Debt									438.53			428.66

1st Lien/Last-Out Unitranche⁽⁵⁾
ASC Acquisition Holdings, LLC⁽³⁾	Distributors	10.03%	L + 7.50%; 1.00% Floor		12/15/2021		8.06		8.01			7.86

Total 1st Lien/Last-Out Unitranche									8.01			7.86

2nd Lien/Senior Secured Debt
DiscoverOrg, LLC⁽³⁾	Software	11.03%	L + 8.50%; 1.00% Floor		02/23/2024		10.50		10.37			10.42
GK Holdings, Inc.	IT Services	13.05%	L + 10.25%; 1.00% Floor		01/20/2022		6.01		5.94			4.86

Total 2nd Lien/Senior Secured Debt									16.31			15.28

Total Corporate Debt								$	462.85		$	451.80

⁽⁺⁾

The terms in the Schedule above disclose the actual interest rate for partially or fully funded debt in effect as of the reporting date. Variable rate loans bear interest at a rate that may be determined by reference to either LIBOR (“L”) or alternate base rate (commonly based on the Prime Rate (“P”)), at the borrower’s option, which reset periodically based on the terms of the credit agreement. L loans are typically indexed to 12 month, 6 month, 3 month, 2 month, 1 month or 1 week L rates. As of December 31, 2018, rates for the 12 month, 6 month, 3 month, 2 month, 1 month and 1 week L are 3.01%, 2.88%, 2.81%, 2.61%, 2.50% and 2.41%, respectively. As of December 31, 2018, P was 5.50%. For investments with multiple reference rates or alternate base rates, the interest rate shown is the weighted average interest rate in effect at December 31, 2018.

⁽¹⁾

⁽²⁾

⁽³⁾

We also hold a portion of senior secured debt in this portfolio company.

⁽⁴⁾

The investment is on non-accrual status as of December 31, 2018.

⁽⁵⁾

⁽⁶⁾

The rate shown is the annualized seven-day yield as of December 31, 2018.

PIK – Payment-In-Kind

Below is certain summarized balance sheet information for the Senior Credit Fund as of March 31, 2019 and December 31, 2018:


	As of
	March 31, 2019		December 31, 2018
	*(in millions)*
Selected Balance Sheet Information
Total investments, at fair value	$	473.87	$	457.09
Cash and other assets		12.88		42.85

Total assets	$	486.75	$	499.94

Debt⁽¹⁾	$	286.34	$	298.34
Other liabilities		8.55		8.69

Total liabilities	$	294.89	$	307.03

Members’ equity	$	191.86	$	192.91

Total liabilities and members’ equity	$	486.75	$	499.94

⁽¹⁾

Net of deferred financing costs for the SPV I Term Loan Facility (as defined below) as of March 31, 2019 and December 31, 2018, which were in the amount of $2.09 million and $2.16 million, respectively.

Below is certain summarized Statement of Operations information for the Senior Credit Fund for the three months ended March 31, 2019 and 2018:


	For the Three Months Ended
	March 31, 2019			March 31, 2018
	*(in millions)*
Selected Statement of Operations Information:
Total investment income	$	9.20		$	10.33

Expenses
Interest and other debt expenses		4.00			3.38
Excess loan origination and structuring fees		–			–
Professional fees		0.20			0.11
Administration and custodian fees		0.10			0.10
Other expenses		0.01			0.02

Total expenses		4.31			3.61

Net investment income (loss)		4.89			6.72

Net realized gain (loss) on investments		–			–
Net change in unrealized appreciation (depreciation) on investments		(1.04	)		0.88

Net increase (decrease) in members’ equity	$	3.85		$	7.60

On December 19, 2016, SPV I entered into an amended and restated credit facility (as amended, the “Asset Based Facility”), which consists of a revolving credit facility (the “SPV I Revolving Credit Facility”), a term loan facility (the “SPV I Term Loan Facility”) and a Class B loan facility (the “SPV I Class B Facility”), with various lenders. For the Asset Based Facility, Natixis, New York Branch (“Natixis”) serves as the facility agent, and State Street Bank and Trust Company serves as the collateral agent. The SPV I Revolving Credit Facility provided for borrowings in an aggregate amount of $19.55 as of March 31, 2019. Borrowings under the SPV I Revolving Credit Facility bear interest at LIBOR plus 2.30%. As of March 31, 2019, the SPV I Term Loan Facility consisted of a $228.87 term loan and the SPV I Class B Facility consisted of a $40.00 Class B loan. Borrowings under the SPV I Term Loan Facility and SPV I Class B Facility bear interest at LIBOR plus 2.30% and LIBOR plus 3.50%, respectively. Any amounts borrowed under the Asset Based Facility will mature, and all accrued and unpaid interest will be due and payable, on December 19, 2025.

As of March 31, 2019 and December 31, 2018, the SPV I’s outstanding borrowings under the Asset Based Facility were $288.42 million and $300.50, respectively. The summary information of the Asset Based Facility for the three months ended March 31, 2019 and 2018 is as follows:


	For the Three Months Ended
	March 31, 2019		March 31, 2018
	*(in millions)*
Borrowing interest expense	$	3.77	$	2.93
Facility fees		0.04		0.26
Amortization of financing costs		0.19		0.19
Total	$	4.00	$	3.38
Weighted average interest rate		5.27%		4.16%
Average outstanding balance	$	290.30	$	285.08

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

The primary use of existing funds and any funds raised in the future is expected to be for our investments in portfolio companies, cash distributions to our stockholders or for other general corporate purposes, including paying for operating expenses or debt service to the extent we borrow or issue senior securities.

We expect to generate cash primarily from the net proceeds of any future offerings of securities, future borrowings and cash flows from operations. To the extent we determine that additional capital would allow us to take advantage of additional investment opportunities, if the market for debt financing presents attractively priced debt financing opportunities, or if our Board of Directors otherwise determines that leveraging our portfolio would be in our best interest and the best interests of our stockholders, we may enter into credit facilities in addition to our existing credit facilities as discussed below, or issue other senior securities. We would expect any such credit facilities may be secured by certain of our assets and may contain advance rates based upon pledged collateral. The pricing and other terms of any such facilities would depend upon market conditions when we enter into any such facilities as well as the performance of our business, among other factors. As a BDC, with certain limited exceptions, we are only permitted to borrow amounts such that our asset coverage ratio, as defined in the Investment Company Act, is at least 150% after such borrowing (if certain requirements are met). See “—Key Components of Operations—Leverage.” As of March 31, 2019 and December 31, 2018, our asset coverage ratio based on the aggregate amount outstanding of our senior securities was 197% and 206%, respectively. We may also refinance or repay any of our indebtedness at any time based on our financial condition and market conditions.

We may enter into commitments either verbally or through signed commitment letters which may ultimately become investment transactions in the future. We regularly evaluate and carefully consider our unfunded commitments using GSAM’s proprietary risk management framework for the purpose of planning our capital resources and ongoing liquidity, including our financial leverage.

As of March 31, 2019, we had cash of approximately $5.89 million, a decrease of $0.22 million from December 31, 2018. Cash used by operating activities for the three months ended March 31, 2019 was approximately $27.26 million, primarily driven by an increase in net assets resulting from operations of $2.22 million, proceeds from sales and principal repayments of $79.05 million and proceeds from other operating activities of $17.58 million, offset by purchases of investments of $126.11 million. Cash provided by financing activities for the three months ended March 31, 2019 was approximately $27.06 million, primarily driven by repayments on debt of $86.00 million, distributions paid of $17.34 million and other financing activities of $0.49 million, offset by borrowings on debt of $130.89 million.

As of March 31, 2018, we had cash of approximately $6.93 million, a decrease of $4.68 million from December 31, 2017. Cash provided by operating activities for the three months ended March 31, 2018 was approximately $31.01 million, primarily driven by an increase in net assets resulting from operations of $18.45 million, proceeds from sales and principal repayments of $78.71 million and net proceeds from investment in affiliated money market of $11.54 million, offset by purchases of investments of $72.78 million and cash used for other operating activities of $4.91 million. Cash used for financing activities for the three months ended March 31, 2018 was approximately $35.69 million, primarily driven by repayments on debt of $74.75 million, distributions paid of $17.56 million and other financing activities of $1.88 million, offset by borrowings on debt of $58.50 million.

To the extent permissible under the risk retention rules and applicable provisions of the Investment Company Act, we may raise capital by securitizing certain of our investments, including through the formation of one or more CLOs or asset based facilities, while retaining all or most of the exposure to the performance of these investments. This would involve contributing a pool of assets to a special purpose entity, and selling debt interests in such entity on a non-recourse or limited-recourse basis to purchasers. We may also pursue other forms of debt financing, including potentially from the Small Business Administration through a future small business investment company subsidiary (subject to regulatory approvals).

Equity Issuances

There were no sales of our common stock during the three months ended March 31, 2019 and 2018.

Common Stock Repurchase Plans

In February 2016, our Board of Directors authorized us to repurchase up to $25.00 million of our common stock if the stock trades below the most recently announced NAV per share (including any updates, corrections or adjustments publicly announced by us to any previously announced NAV per share), from March 18, 2016 to March 18, 2017, subject to certain limitations. In February 2017, our Board of Directors renewed its authorization of the stock repurchase plan to extend the expiration to March 18, 2018, in February 2018, again renewed its authorization of the stock repurchase plan to extend the expiration to March 18, 2019 and, in February 2019, again renewed its authorization of the stock repurchase plan to extend the expiration to March 18, 2020.

In connection with this authorization, we entered into a 10b5-1 plan (the “Company 10b5-1 Plan”). The Company 10b5-1 Plan initially took effect on March 18, 2016 (with any purchases to commence after the opening of NYSE trading on March 21, 2016), was subsequently renewed and expired on March 18, 2018. We entered into an agreement to renew the Company 10b5-1 Plan on May 14, 2018, which was terminated on June 27, 2018 in connection with our offering of Convertible Notes described below in “—Convertible Notes.” On June 27, 2018, we entered into an agreement to renew the Company 10b5-1 Plan with any purchases pursuant to the agreement to commence on September 25, 2018. The Company 10b5-1 Plan expired on March 18, 2019.

In February 2019, our Board of Directors approved a new common stock repurchase plan (the “New Company 10b5-1 Plan”), which provides for us to repurchase of up to $25.00 million of shares of our common stock if the stock trades below the most recently announced net asset value per share, subject to limitations. Under the New Company 10b5-1 Plan, no purchases will be made if such purchases would (i) cause the aggregate ownership of our outstanding stock by Group Inc. and GS & Co. to equal or exceed 25.0% (due to the reduction in outstanding shares of stock as a result of purchase) or (ii) cause our Debt/Equity Ratio to exceed the lower of (a) 1.40 or (b) the Maximum Debt/Equity Ratio. In the New Company 10b5-1 Plan, “Debt/Equity Ratio” means the sum of debt on the Consolidated Statements of Assets and Liabilities and the total notional value of the Purchaser’s unfunded commitments divided by 85% of total equity, as of the most recent reported financial statement end date, and “Maximum Debt/Equity Ratio” means the sum of debt on the balance sheet and committed uncalled debt divided by net assets, as of the most recent reported financial statement end date. The New Company 10b5-1 Plan took effect on March 18, 2019, expires on March 18, 2020 and purchases thereunder will be conducted on a programmatic basis in accordance with Rules 10b5-1 and 10b-18 under the Exchange Act and other applicable securities laws.

Repurchases of our common stock under the New Company 10b5-1 Plan or otherwise may result in the price of our common stock being higher than the price that otherwise might exist in the open market. For the three months ended March 31, 2019 and 2018, we did not repurchase any of our common stock pursuant to the Company 10b5-1 Plan, the New Company 10b5-1 Plan or otherwise.

Dividend Reinvestment Plan

Concurrent with the IPO, we adopted a dividend reinvestment plan that provides for reinvestment of all cash distributions declared by the Board of Directors unless a stockholder elects to “opt out” of the plan. As a result, if the Board of Directors declares a cash distribution, then the stockholders who have not “opted out” of the dividend reinvestment plan will have their cash distributions automatically reinvested in additional shares of common stock, rather than receiving the cash distribution. Due to regulatory considerations, Group Inc. has opted out of the dividend reinvestment plan, and GS & Co. has opted out of the dividend reinvestment plan in respect of any shares of our common stock acquired through the GS 10b5-1 Plan.


Date Declared	Record Date	Payment Date	Shares

October 30, 2018	December 31, 2018	January 15, 2019		39,591

The following table summarizes shares distributed pursuant to the dividend reinvestment plan the three months ended March 31, 2018 to stockholders who had not opted out of the dividend reinvestment plan.


Date Declared	Record Date	Payment Date	Shares

October 31, 2017	December 29, 2017	January 16, 2018		23,824

Contractual Obligations

We have entered into certain contracts under which we have future commitments. Payments under the Investment Management Agreement, pursuant to which GSAM has agreed to serve as our Investment Adviser, are equal to (1) a percentage of value of our average gross assets and (2) a two-part Incentive Fee. Under the Administration Agreement, pursuant to which State Street Bank and Trust Company has agreed to furnish us with the administrative services necessary to conduct our day-to-day operations, we pay our administrator such fees as may be agreed between us and our administrator that we determine are commercially reasonable in our sole discretion. Either party or the stockholders, by a vote of a majority of our outstanding voting securities, may terminate the Investment Management Agreement without penalty on at least 60 days’ written notice to the other party. Either party may terminate the Administration Agreement without penalty upon at least 30 days’ written notice to the other party.

The following table shows our contractual obligations as of March 31, 2019:


	Payments Due by Period (in millions)
	Total		Less Than 1 Year		1 – 3 Years		3 – 5 Years		More Than 5 Years
Revolving Credit Facility	$	516.45	$	–	$	–	$	516.45	$	–
Revolving Credit Facility	€	33.75	€	–	€	–	€	33.75	€	–
Convertible Notes	$	155.00	$	–	$	–	$	155.00	$	–

Revolving Credit Facility

On September 19, 2013, we entered into the Revolving Credit Facility with various lenders. SunTrust Bank serves as administrative agent and Bank of America N.A. serves as syndication agent. We amended and restated the Revolving Credit Facility on October 3, 2014, November 3, 2015, December 16, 2016, February 21, 2018 and September 17, 2018.

The aggregate committed borrowing amount under the Revolving Credit Facility is $795.00 million. The Revolving Credit Facility includes an uncommitted accordion feature that allows us, under certain circumstances, to increase the borrowing capacity of the Revolving Credit Facility up to $1,000.00 million.

Borrowings denominated in USD, including amounts drawn in respect of letters of credit, bear interest (at our election) of either (i) LIBOR plus a margin of either 1.75% or 2.00%, subject to borrowing base conditions or (ii) an alternative base rate, which is the higher of the Prime Rate, Federal Funds Rate plus 0.50% or overnight LIBOR plus 1.00%, plus either 0.75% or 1.00%, subject to borrowing base conditions. Borrowings denominated in EUR bear interest (at our election) or EUR LIBOR plus a margin of either 1.75% or 2.00%, subject to borrowing base conditions. We may elect either the LIBOR, EUR LIBOR, or an alternative base rate at the time of borrowing, and borrowings may be converted from one rate to another at any time, subject to certain conditions. Interest is payable quarterly in arrears. We pay a fee of 0.375% per annum on committed but undrawn amounts under the Revolving Credit Facility, payable quarterly in arrears. Any amounts borrowed under the Revolving Credit Facility will mature, and all accrued and unpaid interest will be due and payable, on February 21, 2023.

The Revolving Credit Facility may be guaranteed by certain of our domestic subsidiaries, including any that are formed or acquired by us in the future (collectively, the “Guarantors”). The Senior Credit Fund is not a Guarantor of the Revolving Credit Facility. Proceeds from borrowings may be used for general corporate purposes, including the funding of portfolio investments.

Our obligations to the lenders under the Revolving Credit Facility are secured by a first priority security interest in substantially all of our portfolio of investments and cash, with certain exceptions. The Revolving Credit Facility contains certain covenants, including: (i) maintaining a minimum shareholder’s equity of $500.00 million plus 25% of net proceeds of the sale of equity interests after February 21, 2018, (ii) maintaining a minimum asset coverage ratio of at least 150%, (iii) maintaining a minimum asset coverage ratio of 200% with respect to consolidated assets (with certain limitations on the contribution of equity in financing subsidiaries as specified therein) of us and our subsidiary guarantors to the secured debt of us and our subsidiary guarantors, (iv) maintaining a minimum Company net worth of at least $350.00 million, (v) maintaining a minimum liquidity test of at least 10% of the covered debt amount during any period when the adjusted covered debt balance is greater than 90% of the adjusted borrowing base, as defined in the Revolving Credit Facility, and (vi) complying with restrictions on industry concentrations in our investment portfolio. We are in compliance with these covenants.

The Revolving Credit Facility also includes customary representations and warranties, conditions precedent to funding of draws and events of default.

Convertible Notes

On October 3, 2016, we closed an offering of $115.00 million aggregate principal amount of unsecured Convertible Notes, which included $15.00 million aggregate principal amount issued pursuant to the initial purchasers’ exercise in full of an over-allotment option (the “Initial Convertible Notes”). The sale of the Initial Convertible Notes generated net proceeds of approximately $110.90 million. We used the net proceeds of the offering to pay down debt under the Revolving Credit Facility.

On July 2, 2018, we closed an offering of $40.00 million aggregate additional principal amount (the “Additional Convertible Notes” and, together with the Initial Convertible Notes, the “Convertible Notes”). The Additional Convertible Notes have identical terms, are fungible and are part of the Initial Convertible Notes. The sale of the Additional Convertible Notes generated net proceeds of approximately $38.57 million. We used the net proceeds of the offering to pay down debt under the Revolving Credit Facility.

The Convertible Notes were issued pursuant to an indenture between us and Wells Fargo Bank, National Association, as Trustee. Wells Fargo Bank, National Association and/or its affiliates provide bank lending and distribution services to certain Goldman Sachs funds. The Convertible Notes bear interest at a rate of 4.50% per year, payable semi-annually in arrears on April 1 and October 1 of each year, commencing on April 1, 2017. The Convertible Notes will mature on April 1, 2022, unless repurchased or converted in accordance with their terms prior to such date. In certain circumstances, the Convertible Notes will be convertible into cash, shares of our common stock or a combination of cash and shares of our common stock, based on an initial conversion rate of 40.8397 shares of our common stock per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of approximately $24.49 per share of common stock, subject to customary anti-dilution adjustments and the other terms of the indenture governing the Convertible Notes. The conversion price is approximately 10.0% above the $22.26 per share closing price of our common stock on September 27, 2016 and 16.7% above the $20.99 per share closing price of our common stock on June 26, 2018. We will not have the right to redeem the Convertible Notes prior to maturity.

Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding October 1, 2021 only under the following circumstances: (1) during any calendar quarter, if the last reported sale price of our common stock for at least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater than or equal to 130% of the conversion price on each applicable trading day; (2) during the five business day period after any five consecutive trading day period (the “measurement period”) in which the trading price per $1,000 principal amount of notes for each trading day of the measurement period was less than 98% of the product of the last reported sale price of our common stock and the conversion rate on each such trading day; or (3) upon the occurrence of specified corporate events. On or after October 1, 2021, until the close of business on the scheduled trading day immediately preceding the maturity date, holders may convert their notes at any time, regardless of the occurrence or nonoccurrence of any of the foregoing circumstances.

The Convertible Notes are accounted for in accordance with Accounting Standards Codification (“ASC”) Topic 470-20, Debt with Conversion and Other Options. Upon conversion of any of the Convertible Notes, we intend to pay the outstanding principal amount in cash and, to the extent that the conversion value exceeds the principal amount, we have the option to pay the excess amount in cash or shares of our common stock (or a combination of cash and shares), subject to the requirements of the indenture governing the Convertible Notes. We have determined that the embedded conversion options in the Convertible Notes are not required to be separately accounted for as derivatives under ASC 815, Derivatives and Hedging. At the time of issuance the values of the debt and equity components of the Initial Convertible Notes and Additional Convertible Notes were approximately 99.4% and 0.6%, and 97.9% and 2.1%, respectively.

The OID equal to the equity component of the Convertible Notes was recorded in “paid-in capital in excess of par” in the accompanying Consolidated Statements of Assets and Liabilities. We record interest expense comprised of both stated interest and amortization of the OID. At the time of issuance, the equity component of the Initial Convertible Notes and the Additional Convertible Notes were $0.74 million and $0.84 million, respectively. Additionally, the issuance costs associated with the Convertible Notes were allocated to the debt and equity components in proportion to the allocation of the values at the time of issuance and accounted for as debt issuance costs and equity issuance costs, respectively.

HEDGING

Subject to applicable provisions of the Investment Company Act and applicable Commodity Futures Trading Commission (“CFTC”) regulations, we may enter into hedging transactions in a manner consistent with SEC guidance. To the extent that any of our loans are denominated in a currency other than U.S. dollars, we may enter into currency hedging contracts to reduce our exposure to fluctuations in currency exchange rates. We may also enter into interest rate hedging agreements. Such hedging activities, which will be subject to compliance with applicable legal requirements, may include the use of futures, options, swaps and forward contracts. Costs incurred in entering into such contracts or in settling them, if any, will be borne by us. The Investment Adviser has claimed no-action relief from CFTC registration and regulation as a commodity pool operator pursuant to a CFTC staff no-action letter (the “BDC CFTC No-Action Letter”) with respect to our operations, with the result that we will be limited in our ability to use futures contracts or options on futures contracts or engage in swap transactions. Specifically, the BDC CFTC No-Action Letter imposes strict limitations on using such derivatives other than for hedging purposes, whereby the use of derivatives not used solely for hedging purposes is generally limited to situations where (i) the aggregate initial margin and premiums required to establish such positions does not exceed five percent of the liquidation value of our portfolio, after taking into account unrealized profits and unrealized losses on any such contracts it has entered into; or (ii) the aggregate net notional value of such derivatives does not exceed 100% of the liquidation value of our portfolio. Moreover, we anticipate entering into transactions involving such derivatives to a very limited extent solely for hedging purposes or otherwise within the limitations of the BDC CFTC No-Action Letter.

OFF-BALANCE SHEET ARRANGEMENTS

We may become a party to investment commitments and to financial instruments with off-balance sheet risk in the normal course of our business to fund investments and to meet the financial needs of our portfolio companies. These instruments may include commitments to extend credit and involve, to varying degrees, elements of liquidity and credit risk in excess of the amount recognized in the balance sheet.

As of March 31, 2019, we believed that we had adequate financial resources to satisfy our unfunded commitments. As of March 31, 2019 and December 31, 2018, our unfunded commitments to provide funds to portfolio companies were as follows:


	As of
	March 31, 2019		December 31, 2018
	*(in millions)*
Unfunded Commitments
First Lien/Senior Secured Debt	$	122.41	$	94.40
Second Lien/Senior Secured Debt		2.36		2.35

Total	$	124.77	$	96.75

RECENT DEVELOPMENTS

On May 7, 2019, our Board of Directors declared a quarterly distribution of $0.45 per share payable on July 15, 2019 to holders of record as of June 28, 2019.

On May 8, 2019, we and Cal Regents each contributed $125.56 million to the Senior Credit Fund, which was used by the Senior Credit Fund to repay in full all outstanding indebtedness, including all accrued and unpaid interest and fees, under the Asset Based Facility and to fund certain other related expenses that the Senior Credit Fund expects to incur in connection with its dissolution. The Asset Based Facility was then terminated and all liens securing the collateral under the Asset Based Facility were released. We funded our portion of the contributed amount through additional borrowings under our Revolving Credit Facility.

Following the repayment and termination, the Senior Credit Fund distributed each member’s pro rata share of all of its assets (other than cash and cash equivalents), primarily consisting of senior secured loans, to the members. We also assumed the obligation to fund outstanding unfunded commitments of the Senior Credit Fund that totaled $7.80 million as of March 31, 2019, representing 50% of the Senior Credit Fund’s aggregate unfunded commitments. The pro rata portion of the assets received by us will become our assets and will be directly included in our consolidated financial statements and notes thereto, and will also be included for purposes of determining our asset coverage ratio. Based on March 31, 2019 balances, the assets to be received by us are approximately $221.77 million and $215.73 million at amortized cost and at fair value, respectively.

In connection with the repayment of the Asset Based Facility and the distribution of all of its loan assets, the Senior Credit Fund declared a $2.00 million cash distribution to its members, representing estimated quarter-to-date net investment income, 50% of which will be paid to us.

We and Cal Regents have begun the process of dissolving the Senior Credit Fund. After the satisfaction of all remaining liabilities and the distribution of any remaining assets (including any amounts owed to it and not yet received), the Senior Credit Fund will be wound up and terminated.

CRITICAL ACCOUNTING POLICIES

Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Changes in the economic environment, financial markets and any other parameters used in determining such estimates could cause actual results to differ materially. In addition to the discussion below, our critical accounting policies are further described in the notes to the consolidated financial statements.

Valuation of Portfolio Investments

As a BDC, we conduct the valuation of our assets, pursuant to which our NAV is determined, consistent with GAAP and the Investment Company Act. Our Board of Directors, with the assistance of our Audit Committee, determines the fair value of our assets within the meaning of the Investment Company Act, on at least a quarterly basis, in accordance with the terms of Financial Accounting Standards Board ASC Topic 820, Fair Value Measurement and Disclosures (“ASC 820”).

ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is a market-based measurement, not an entity-specific measurement. For some assets and liabilities, observable market transactions or market information might be available. For other assets and liabilities, observable market transactions and market information might not be available. However, the objective of a fair value measurement in both cases is the same – to estimate the price when an orderly transaction to sell the asset or transfer the liability would take place between market participants at the measurement date under current market conditions (that is, an exit price at the measurement date from the perspective of a market participant that holds the asset or owes the liability).

ASC 820 establishes a hierarchal disclosure framework which ranks the observability of inputs used in measuring financial instruments at fair value. The observability of inputs is impacted by a number of factors, including the type of financial instruments and their specific characteristics. Financial instruments with readily available quoted prices, or for which fair value can be measured from quoted prices in active markets, generally will have a higher degree of market price observability and a lesser degree of judgment applied in determining fair value. The levels used for classifying investments are not necessarily an indication of the risk associated with investing in these securities.

The three-level hierarchy for fair value measurement is defined as follows:

Level 1—inputs to the valuation methodology are quoted prices available in active markets for identical instruments as of the reporting date. The types of financial instruments included in Level 1 include unrestricted securities, including equities and derivatives, listed in active markets.

Level 2—inputs to the valuation methodology are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date. The type of financial instruments in this category includes less liquid and restricted securities listed in active markets, securities traded in other than active markets, government and agency securities, and certain over-the-counter derivatives where the fair value is based on observable inputs.

Level 3—inputs to the valuation methodology are unobservable and significant to overall fair value measurement. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category include investments in privately held entities and certain over-the-counter derivatives where the fair value is based on unobservable inputs.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment and considers factors specific to the financial instrument.

Currently, the majority of our investments fall within Level 3 of the fair value hierarchy. We do not expect that there will be readily available market values for most of the investments which are in our portfolio, and we value such investments at fair value as determined in good faith by or under the direction of our Board of Directors using a documented valuation policy, described below, and a consistently applied valuation process. The factors that may be taken into account in pricing our investments at fair value include, as relevant, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flow, and the markets in which the portfolio company does business, comparison to publicly traded securities and other relevant factors. Available current market data are considered such as applicable market yields and multiples of publicly traded securities, comparison of financial ratios of peer companies, and changes in the interest rate environment and the credit markets that may affect the price at which similar investments would trade in their principal market, and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate or revise our valuation.

With respect to investments for which market quotations are not readily available, or for which market quotations are deemed not reflective of the fair value, the valuation procedures adopted by our Board of Directors contemplates a multi-step valuation process each quarter, as described below:

(1)

Our quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals of our Investment Adviser responsible for the portfolio investment;

(2)

Our Board of Directors also engages independent valuation firms (the “Independent Valuation Advisors”) to provide independent valuations of the investments for which market quotations are not readily available, or are readily available but deemed not reflective of the fair value of an investment. The Independent Valuation Advisors independently value such investments using quantitative and qualitative information provided by the investment professionals of the Investment Adviser as well as any market quotations obtained from independent pricing services, brokers, dealers or market dealers. The Independent Valuation Advisors also provide analyses to support their valuation methodology and calculations. The Independent Valuation Advisors provide an opinion on a final range of values on such investments to our Board of Directors or the Audit Committee. The Independent Valuation Advisors define fair value in accordance with ASC 820 and utilize valuation approaches including the market approach, the income approach or both. A portion of the portfolio is reviewed on a quarterly basis, and all investments in the portfolio for which market quotations are not readily available, or are readily available, but deemed not reflective of the fair value of an investment, are reviewed at least annually by an Independent Valuation Advisor;

(3)

The Independent Valuation Advisors’ preliminary valuations are reviewed by our Investment Adviser and the Valuation Oversight Group (“VOG”), a team that is part of the Controllers Department within the Finance Division of Goldman Sachs. The Independent Valuation Advisors’ ranges are compared to our Investment Adviser’s valuations to ensure our Investment Adviser’s valuations are reasonable. VOG presents the valuations to the Private Investment Valuation and Side Pocket Working Group of the Investment Management Division Valuation Committee, which is comprised of representatives from GSAM who are independent of the investment making decision process;

(4)

The Investment Management Division Valuation Committee ratifies fair valuations and makes recommendations to the Audit Committee of the Board of Directors;

(5)

The Audit Committee of our Board of Directors reviews valuation information provided by the Investment Management Division Valuation Committee, our Investment Adviser and the Independent Valuation Advisors. The Audit Committee then assesses such valuation recommendations; and

(6)

Our Board of Directors discusses the valuations and, within the meaning of the Investment Company Act, determines the fair value of our investments in good faith, based on the input of our Investment Adviser, the Independent Valuation Advisors and the Audit Committee.

Investment Transactions and Related Investment Income

We record our investment transactions on a trade date basis, which is the date when we assume the risks for gains and losses related to that instrument. Realized gains and losses are based on the specific identification method. Dividend income on common equity investments is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies. Interest income and dividend income are presented net of withholding tax, if any. Accretion of discounts and amortization of premiums, which are included in interest income and expense, are recorded over the life of the underlying instrument using the effective interest method.

Fair value generally is based on quoted market prices, broker or dealer quotations, or alternative price sources. In the absence of quoted market prices, broker or dealer quotations, or alternative price sources, investments in securities are measured at fair value as determined by our Investment Adviser and/or by one or more independent third parties.

Non-Accrual Status

Investments are placed on non-accrual status when it is probable that principal, interest or dividends will not be collected according to the contractual terms. Accrued interest or dividends generally are reversed when an investment is placed on non-accrual status. Interest or dividend payments received on non-accrual investments may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual investments are restored to accrual status when past due principal and interest or dividends are paid and, in management’s judgment, principal and interest or dividend payments are likely to remain current. We may make exceptions to this treatment if the investment has sufficient collateral value and is in the process of collection. As of March 31, 2019, we had certain investments held in three portfolio companies on non-accrual status, which represented 4.5% and 3.5% of the total investments at amortized cost and at fair value, respectively. As of December 31, 2018, we had certain investments held in three portfolio companies on non-accrual status, which represented 8.3% and 7.0% of the total investments at amortized cost and at fair value, respectively.

Distribution Policy

We intend to pay quarterly distributions to our stockholders out of assets legally available for distribution. Future quarterly distributions, if any, will be determined by our Board of Directors. All distributions will be subject to lawfully available funds therefor, and no assurance can be given that we will be able to declare distributions in future periods.

We have elected to be treated, and expect to qualify annually, as a RIC under Subchapter M of the Code, commencing with our taxable year ended December 31, 2013. To maintain our tax treatment as a RIC, we must, among other things, timely distribute to our stockholders at least 90% of our investment company taxable income for each taxable year. We intend to timely distribute to our stockholders substantially all of our annual taxable income for each year, except that we may retain certain net capital gains for reinvestment and carry forward taxable income for distribution in the following year and pay any applicable tax. The distributions we pay to our stockholders in a year may exceed our 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. The specific tax characteristics of our distributions will be reported to stockholders after the end of the calendar year. Stockholders should read carefully any written disclosure regarding a distribution from us and should not assume that the source of any distribution is our net ordinary income or capital gains.

We have adopted an “opt out” dividend reinvestment plan for our common stockholders. As a result, if our Board of Directors declares a cash distribution, each stockholder that has not “opted out” of our dividend reinvestment plan will have its distribution automatically reinvested in additional shares of our common stock rather than receiving the cash distribution. Stockholders who receive distributions in the form of shares of common stock will generally be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions; however, since their cash distributions will be reinvested, those stockholders will not receive cash with which to pay any applicable taxes. Due to regulatory considerations, Group Inc. has opted out of the dividend reinvestment plan, and GS & Co. has opted out of the dividend reinvestment plan in respect of any shares of our common stock acquired through the GS 10b5-1 Plan.

Federal Income Taxes

As a RIC, we generally will not be required to pay corporate-level U.S. federal income taxes on any net ordinary income or capital gains that we timely distribute to our stockholders as dividends. To maintain our RIC status, we must meet specified source-of-income and asset diversification requirements and timely distribute to our stockholders at least 90% of our investment company taxable income for each year. Depending upon the level of taxable income earned in a year, we may choose to carry forward taxable income for distribution in the following year and pay any applicable tax. We generally will be required to pay a U.S. federal excise tax if our distributions during a calendar year do not exceed the sum of (1) 98% of our net ordinary income (taking into account certain deferrals and elections) for the calendar year, (2) 98.2% of our capital gains in excess of capital losses for the one-year period ending on October 31 of the calendar year and (3) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years.

Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and realized gains recognized for financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified among capital accounts in the consolidated financial statements to reflect their tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future. Differences in classification may also result from the treatment of short-term gains as ordinary income for tax purposes.

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are subject to financial market risks, most significantly changes in interest rates. Interest rate sensitivity refers to the change in our earnings that may result from changes in the level of interest rates. Because we expect to fund a portion of our investments with borrowings, our net investment income is expected to be affected by the difference between the rate at which we invest and the rate at which we borrow. As a result, we can offer no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income.

As of March 31, 2019 and December 31, 2018, on a fair value basis, approximately 3.7% and 3.4%, respectively, of our performing debt investments bore interest at a fixed rate (including income producing preferred stock investments), and approximately 96.3% and 96.6%, respectively, of our performing debt investments bore interest at a floating rate. Our borrowings under the Revolving Credit Facility bear interest at a floating rate and the Convertible Notes bear interest at a fixed rate.

We regularly measure our exposure to interest rate risk. We assess interest rate risk and manage our interest rate exposure on an ongoing basis by comparing our interest rate sensitive assets to our interest rate sensitive liabilities.

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


As of March 31, 2019 Basis Point Change	Interest Income			Interest Expense			Net Income
*(in millions)*
Up 300 basis points	$	29.93		$	(15.57	)	$	14.36
Up 200 basis points		19.95			(10.38	)		9.57
Up 100 basis points		9.98			(5.19	)		4.79
Up 75 basis points		7.48			(3.89	)		3.59
Up 50 basis points		4.99			(2.59	)		2.40
Up 25 basis points		2.49			(1.30	)		1.19
Down 25 basis points		(2.49	)		1.30			(1.19	)
Down 50 basis points		(4.99	)		2.59			(2.40	)
Down 75 basis points		(7.48	)		3.89			(3.59	)
Down 100 basis points		(9.98	)		5.19			(4.79	)
Down 200 basis points		(15.89	)		10.38			(5.51	)
Down 300 basis points		(16.67	)		12.94			(3.73	)

We may, in the future, hedge against interest rate fluctuations by using standard hedging instruments such as futures, options and forward contracts subject to the requirements of the Investment Company Act, applicable CFTC regulations and in a manner consistent with SEC guidance. While hedging activities may insulate us against adverse changes in interest rates, they may also limit our ability to participate in benefits of lower interest rates with respect to our portfolio of investments with fixed interest rates.

ITEM 4.

CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this report, our management carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective as of March 31, 2019. In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the benefits of possible controls and procedures relative to their costs.

Changes in Internal Control over Financial Reporting. There have been no changes in our internal control over financial reporting that occurred during our most recently completed fiscal quarter ended March 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings.

From time to time, we may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of our rights under loans to or other contracts with our portfolio companies. We are not currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us.

Item 1A. Risk Factors.

An investment in our securities involves a high degree of risk. There have been no material changes to the risk factors previously reported under Item 1A: “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2018, which was filed with the SEC on February 28, 2019. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may materially affect our business, financial condition and/or operating results.

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

None.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

On May 8, 2019, the Senior Credit Fund repaid in full all outstanding indebtedness, including all accrued and unpaid interest and fees, under the Asset Based Facility, and distributed each member’s pro rata share of all of the assets held by it to the members. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Recent Developments.”

Item 6. Exhibits.

The exhibits filed as part of this Quarterly Report on Form 10-Q are set forth on the Index to Exhibits, which is incorporated herein by reference.


Exhibit No		Description of Exhibits

3.1		Certificate of Incorporation (incorporated by reference to Exhibit (a) to pre-effective Amendment No. 7 to the Company’s Registration Statement on Form N-2 (file no. 333-187642), filed on March 3, 2015).

3.2		Bylaws (incorporated by reference to Exhibit (b) to pre-effective Amendment No. 7 to the Company’s Registration Statement on Form N-2 (file no. 333-187642), filed on March 3, 2015).

31.1*		Certification of Chief Executive Officer pursuant to Securities Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Chief Financial Officer pursuant to Securities Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1*		Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

*	Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


						GOLDMAN SACHS BDC, INC.

Date: May 9, 2019						/s/ Brendan McGovern
						Brendan McGovern Chief Executive Officer and President (Principal Executive Officer)

Date: May 9, 2019						/s/ Jonathan Lamm
						Jonathan Lamm Chief Financial Officer and Treasurer (Principal Financial Officer)