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 fiscal quarter ended March 31, 2021

OR

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

Commission File Number 814-01190

 

OWL ROCK CAPITAL CORPORATION

(Exact name of Registrant as specified in its Charter)

 

Maryland

 

47-5402460

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

399 Park Avenue, 38th Floor, New York, New York

 

10022

(Address of principal executive offices)

 

(Zip Code)

Registrant’s telephone number, including area code: (212) 419-3000

 

 

 

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, $0.01 par value per share

ORCC

The New York Stock Exchange

 

 

 

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

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

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definition 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

 

Small reporting company

 

 

 

 

 

Emerging growth company

 

 

 

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

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

As of May 5, 2021, the registrant had 391,401,787 shares of common stock, $0.01 par value per share, outstanding.

 

i


 

Table of Contents

 

 

 

 

 

Page

PART I

 

FINANCIAL INFORMATION

 

 

Item 1.

 

Consolidated Financial Statements

 

2

 

 

Consolidated Statements of Assets and Liabilities as of March 31, 2021 (Unaudited) and December 31, 2020

 

2

 

 

Consolidated Statements of Operations for the Three Months Ended March 31, 2021 and 2020 (Unaudited)

 

3

 

 

Consolidated Schedules of Investments as of March 31, 2021 (Unaudited) and December 31, 2020

 

4

 

 

Consolidated Statements of Changes in Net Assets for the Three Months Ended March 31, 2021 and 2020 (Unaudited)

 

33

 

 

Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2021 and 2020 (Unaudited)

 

34

 

 

Notes to Consolidated Financial Statements (Unaudited)

 

36

Item 2.

 

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

 

79

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risk

 

125

Item 4.

 

Controls and Procedures

 

126

 

 

 

 

 

PART II

 

OTHER INFORMATION

 

 

Item 1.

 

Legal Proceedings

 

127

Item 1A.

 

Risk Factors

 

128

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

129

Item 3.

 

Defaults Upon Senior Securities

 

129

Item 4.

 

Mine Safety Disclosures

 

129

Item 5.

 

Other Information

 

129

Item 6.

 

Exhibits

 

130

Signatures

 

 

 

131

 

 

ii


 

 

 

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

 

This report contains forward-looking statements that involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about Owl Rock Capital Corporation (the “Company,” “we” or “our”), our current and prospective portfolio investments, our industry, our beliefs and opinions, and our assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation:

 

 

an economic downturn could impair our portfolio companies’ ability to continue to operate, which could lead to the loss of some or all of our investments in such portfolio companies;

 

an economic downturn could disproportionately impact the companies that we intend to target for investment, potentially causing us to experience a decrease in investment opportunities and diminished demand for capital from these companies;

 

an economic downturn could also impact availability and pricing of our financing and our ability to access the debt and equity capital markets;

 

a contraction of available credit and/or an inability to access the equity markets could impair our lending and investment activities;

 

the impact of the novel strain of coronavirus known as “COVID-19” and related changes in base interest rates and significant market volatility on our business, our portfolio companies, our industry and the global economy;

 

interest rate volatility, including the decommissioning of LIBOR, could adversely affect our results, particularly if we elect to use leverage as part of our investment strategy;

 

currency fluctuations could adversely affect the results of our investments in foreign companies, particularly to the extent that we receive payments denominated in foreign currency rather than U.S. dollars;

 

our future operating results;

 

our business prospects and the prospects of our portfolio companies including our and their ability to achieve our respective objectives as a result of the current COVID-19 pandemic;

 

our contractual arrangements and relationships with third parties;

 

the ability of our portfolio companies to achieve their objectives;

 

competition with other entities and our affiliates for investment opportunities;

 

the speculative and illiquid nature of our investments;

 

the use of borrowed money to finance a portion of our investments as well as any estimates regarding potential use of leverage;

 

the adequacy of our financing sources and working capital;

 

the loss of key personnel;

 

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

 

the ability of Owl Rock Capital Advisors LLC (“the Adviser” or “our Adviser”) to locate suitable investments for us and to monitor and administer our investments;

 

the ability of the Adviser to attract and retain highly talented professionals;

 

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

 

the effect of legal, tax and regulatory changes, including the Coronavirus Aid, Relief and Economic Security Act signed into law in December 2020 and the American Rescue Plan Act of 2021, signed into law in March 2021; and

 

other risks, uncertainties and other factors previously identified in the reports and other documents we have filed with the Securities and Exchange Commission (“SEC”).

 

Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this report should not be regarded as a representation by us that our plans and objectives will be achieved. These forward-looking statements apply only as of the date of this report. Moreover, we assume no duty and do not undertake to update the forward-looking statements. Because we are an investment company, the forward-looking statements and projections contained in this report are excluded from the safe harbor protection provided by Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”).


1


 

 

PART I. CONSOLIDATED FINANCIAL INFORMATION

 

Item 1. Consolidated Financial Statements

Owl Rock Capital Corporation

Consolidated Statements of Assets and Liabilities

(Amounts in thousands, except share and per share amounts)

 

 

 

March 31, 2021

(Unaudited)

 

 

December 31, 2020

 

Assets

 

 

 

 

 

 

 

 

Investments at fair value

 

 

 

 

 

 

 

 

Non-controlled, non-affiliated investments (amortized cost of $10,892,469 and

     $10,653,613, respectively)

 

$

10,862,051

 

 

$

10,569,691

 

Controlled, affiliated investments (amortized cost of $380,280 and $275,105,

     respectively)

 

 

378,421

 

 

 

272,381

 

Total investments at fair value (amortized cost of $11,272,749 and $10,928,718, respectively)

 

 

11,240,472

 

 

 

10,842,072

 

Cash (restricted cash of $7,699 and $8,841, respectively)

 

 

244,159

 

 

 

347,917

 

Foreign cash (cost of $11,037 and $9,641, respectively)

 

 

11,106

 

 

 

9,994

 

Interest receivable

 

 

55,854

 

 

 

57,108

 

Receivable for investments sold

 

 

4,355

 

 

 

6,316

 

Receivable from a controlled affiliate

 

 

2,367

 

 

 

2,347

 

Prepaid expenses and other assets

 

 

29,929

 

 

 

38,603

 

Total Assets

 

$

11,588,242

 

 

$

11,304,357

 

Liabilities

 

 

 

 

 

 

 

 

Debt (net of unamortized debt issuance costs of $88,161 and $91,085, respectively)

 

$

5,545,891

 

 

$

5,292,722

 

Distribution payable

 

 

121,335

 

 

 

152,087

 

Management fee payable

 

 

42,107

 

 

 

35,936

 

Incentive fee payable

 

 

21,776

 

 

 

19,070

 

Payables to affiliates

 

 

2,587

 

 

 

6,527

 

Accrued expenses and other liabilities

 

 

52,458

 

 

 

51,581

 

Total Liabilities

 

 

5,786,154

 

 

 

5,557,923

 

Commitments and contingencies (Note 7)

 

 

 

 

 

 

 

 

Net Assets

 

 

 

 

 

 

 

 

Common shares $0.01 par value, 500,000,000 shares authorized; 391,401,787 and

     389,966,688 shares issued and outstanding, respectively

 

 

3,914

 

 

 

3,900

 

Additional paid-in-capital

 

 

5,960,109

 

 

 

5,940,979

 

Total distributable earnings (losses)

 

 

(161,935

)

 

 

(198,445

)

Total Net Assets

 

 

5,802,088

 

 

 

5,746,434

 

Total Liabilities and Net Assets

 

$

11,588,242

 

 

$

11,304,357

 

Net Asset Value Per Share

 

$

14.82

 

 

$

14.74

 

 

The accompanying notes are an integral part of these consolidated financial statements.

2


 

Owl Rock Capital Corporation

Consolidated Statements of Operations

(Amounts in thousands, except share and per share amounts)

(Unaudited)

 

 

 

For the Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

Investment Income

 

 

 

 

 

 

 

 

Investment income from non-controlled, non-affiliated investments:

 

 

 

 

 

 

 

 

Interest income

 

 

211,032

 

 

$

198,393

 

Dividend Income

 

 

3,559

 

 

 

 

Other income

 

 

3,154

 

 

 

4,151

 

Total investment income from non-controlled, non-affiliated investments

 

 

217,745

 

 

 

202,544

 

Investment income from controlled, affiliated investments:

 

 

 

 

 

 

 

 

Interest income

 

 

1,303

 

 

 

 

Dividend income

 

 

2,368

 

 

 

2,188

 

Other Income

 

 

157

 

 

 

 

Total investment income from controlled, affiliated investments

 

 

3,828

 

 

 

2,188

 

Total Investment Income

 

 

221,573

 

 

 

204,732

 

Expenses

 

 

 

 

 

 

 

 

Interest expense

 

 

48,076

 

 

 

33,957

 

Management fee

 

 

42,110

 

 

 

33,790

 

Performance based incentive fees

 

 

21,775

 

 

 

25,595

 

Professional fees

 

 

3,768

 

 

 

3,152

 

Directors' fees

 

 

244

 

 

 

233

 

Other general and administrative

 

 

1,818

 

 

 

2,164

 

Total Operating Expenses

 

 

117,791

 

 

 

98,891

 

Management and incentive fees waived (Note 3)

 

 

 

 

 

(42,490

)

Net Operating Expenses

 

 

117,791

 

 

 

56,401

 

Net Investment Income (Loss) Before Taxes

 

 

103,782

 

 

 

148,331

 

Income taxes, including excise tax expense (benefit)

 

 

1,127

 

 

 

2,075

 

Net Investment Income (Loss) After Taxes

 

$

102,655

 

 

$

146,256

 

Net Realized and Change in Unrealized Gain (Loss)

 

 

 

 

 

 

 

 

Net change in unrealized gain (loss):

 

 

 

 

 

 

 

 

Non-controlled, non-affiliated investments

 

$

57,079

 

 

$

(444,135

)

Income tax (provision) benefit

 

 

(2,633

)

 

 

 

Controlled affiliated investments

 

 

865

 

 

 

(14,899

)

Translation of assets and liabilities in foreign currencies

 

 

(2,432

)

 

 

(81

)

Total Net Change in Unrealized Gain (Loss)

 

 

52,879

 

 

 

(459,115

)

Net realized gain (loss):

 

 

 

 

 

 

 

 

Non-controlled, non-affiliated investments

 

 

1,154

 

 

 

348

 

Foreign currency transactions

 

 

1,157

 

 

 

(79

)

Total Net Realized Gain (Loss)

 

 

2,311

 

 

 

269

 

Total Net Realized and Change in Unrealized Gain (Loss)

 

 

55,190

 

 

 

(458,846

)

Net Increase (Decrease) in Net Assets Resulting from Operations

 

$

157,845

 

 

$

(312,590

)

Earnings Per Share - Basic and Diluted

 

$

0.40

 

 

$

(0.79

)

Weighted Average Shares Outstanding - Basic and Diluted

 

 

391,114,767

 

 

 

393,441,711

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

3


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Non-controlled/non-affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aerospace and defense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aviation Solutions Midco, LLC (dba STS Aviation)(4)(6)(24)

 

First lien senior secured loan

 

L + 9.25% (incl. 9.25% PIK)

 

 

1/3/2025

 

 

216,119

 

 

 

213,306

 

 

 

192,346

 

 

 

3.3

 

%

Valence Surface Technologies LLC(4)(7)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

6/28/2025

 

 

98,250

 

 

 

97,148

 

 

 

89,899

 

 

 

1.5

 

%

Valence Surface Technologies LLC(4)(7)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 5.75%

 

 

6/28/2021

 

 

23,760

 

 

 

23,473

 

 

 

21,230

 

 

 

0.4

 

%

Valence Surface Technologies LLC(4)(7)(16)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

6/28/2025

 

 

6,000

 

 

 

5,894

 

 

 

5,150

 

 

 

0.1

 

%

 

 

 

 

 

 

 

 

 

 

 

344,129

 

 

 

339,821

 

 

 

308,625

 

 

 

5.3

 

%

Automotive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mavis Tire Express Services Corp.(4)(5)(24)

 

First lien senior secured loan

 

L + 3.25%

 

 

3/20/2025

 

 

862

 

 

 

814

 

 

 

862

 

 

 

 

%

Mavis Tire Express Services Corp.(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.59%

 

 

3/20/2026

 

 

191,281

 

 

 

188,505

 

 

 

191,281

 

 

 

3.3

 

%

 

 

 

 

 

 

 

 

 

 

 

192,143

 

 

 

189,319

 

 

 

192,143

 

 

 

3.3

 

%

Buildings and real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Associations, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 7.00% (incl. 3.00% PIK)

 

 

7/30/2024

 

 

309,140

 

 

 

306,574

 

 

 

309,140

 

 

 

5.3

 

%

Associations, Inc.(4)(6)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 7.00% (incl. 3.00% PIK)

 

 

7/30/2021

 

 

59,617

 

 

 

59,217

 

 

 

59,612

 

 

 

1.0

 

%

Associations, Inc.(4)(6)(24)

 

First lien senior secured revolving loan

 

L + 6.00%

 

 

7/30/2024

 

 

11,543

 

 

 

11,463

 

 

 

11,485

 

 

 

0.2

 

%

Reef Global, Inc. (fka Cheese Acquisition, LLC)(4)(7)(24)

 

First lien senior secured loan

 

L + 6.00% (incl. 1.25% PIK)

 

 

11/28/2024

 

 

134,289

 

 

 

133,106

 

 

 

128,246

 

 

 

2.2

 

%

Imperial Parking Canada(4)(8)(24)

 

First lien senior secured loan

 

C + 6.00% (incl. 1.25% PIK)

 

 

11/28/2024

 

 

28,112

 

 

 

26,569

 

 

 

26,847

 

 

 

0.5

 

%

Reef Global, Inc. (fka Cheese Acquisition, LLC)(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 4.75%

 

 

11/28/2023

 

 

10,987

 

 

 

10,915

 

 

 

10,251

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

 

 

553,688

 

 

 

547,844

 

 

 

545,581

 

 

 

9.4

 

%

Business services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Access CIG, LLC(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.75%

 

 

2/27/2026

 

 

58,760

 

 

 

58,280

 

 

 

58,025

 

 

 

1.0

 

%

4


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

CIBT Global, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 3.75%

 

 

6/3/2024

 

 

841

 

 

 

670

 

 

 

597

 

 

 

 

%

CIBT Global, Inc.(4)(6)(24)(29)

 

Second lien senior secured loan

 

L + 7.75% (incl. 6.75% PIK)

 

 

6/2/2025

 

 

63,678

 

 

 

57,051

 

 

 

25,153

 

 

 

0.4

 

%

ConnectWise, LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 5.25%

 

 

2/28/2025

 

 

178,200

 

 

 

176,620

 

 

 

178,200

 

 

 

3.1

 

%

ConnectWise, LLC(4)(5)(16)(24)

 

First lien senior secured revolving loan

 

L + 5.25%

 

 

2/28/2025

 

 

1,250

 

 

 

1,084

 

 

 

1,250

 

 

 

 

%

Entertainment Benefits Group, LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 8.25% (incl. 2.50% PIK)

 

 

9/30/2025

 

 

81,818

 

 

 

80,873

 

 

 

72,818

 

 

 

1.3

 

%

Entertainment Benefits Group, LLC(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 8.25% (incl. 2.50% PIK)

 

 

9/30/2024

 

 

10,096

 

 

 

9,980

 

 

 

8,864

 

 

 

0.2

 

%

Hercules Borrower, LLC (dba The Vincit Group)(4)(7)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

12/15/2026

 

 

180,043

 

 

 

177,449

 

 

 

178,243

 

 

 

3.1

 

%

Hercules Borrower, LLC (dba The Vincit Group)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.50%

 

 

12/15/2026

 

 

-

 

 

 

(298

)

 

 

(209

)

 

 

 

%

Hercules Buyer, LLC (dba The Vincit Group)(24)(26)(30)

 

Unsecured notes

 

0.48% (incl. 0.48% PIK)

 

 

12/14/2029

 

 

5,112

 

 

 

5,112

 

 

 

5,112

 

 

 

0.1

 

%

Vestcom Parent Holdings, Inc.(4)(5)

 

Second lien senior secured loan

 

L + 8.00%

 

 

12/19/2024

 

 

78,987

 

 

 

78,356

 

 

 

78,987

 

 

 

1.4

 

%

 

 

 

 

 

 

 

 

 

 

 

658,785

 

 

 

645,177

 

 

 

607,040

 

 

 

10.6

 

%

Chemicals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aruba Investments Holdings LLC (dba Angus Chemical Company)(4)(7)(24)

 

Second lien senior secured loan

 

L + 7.75%

 

 

11/24/2028

 

 

10,000

 

 

 

9,857

 

 

 

9,900

 

 

 

0.2

 

%

Douglas Products and Packaging Company LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

10/19/2022

 

 

97,687

 

 

 

97,334

 

 

 

96,223

 

 

 

1.7

 

%

Douglas Products and Packaging Company LLC(4)(9)(16)(24)

 

First lien senior secured revolving loan

 

P + 4.75%

 

 

10/19/2022

 

 

4,239

 

 

 

4,215

 

 

 

4,103

 

 

 

0.1

 

%

Gaylord Chemical Company, L.L.C(4)(5)(24)

 

First lien senior secured loan

 

L + 6.00%

 

 

3/30/2027

 

 

153,798

 

 

 

152,262

 

 

 

152,260

 

 

 

2.6

 

%

Gaylord Chemical Company, L.L.C(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.00%

 

 

3/30/2026

 

 

-

 

 

 

(132

)

 

 

(132

)

 

 

 

%

Innovative Water Care Global Corporation(4)(6)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

2/27/2026

 

 

147,000

 

 

 

139,193

 

 

 

136,710

 

 

 

2.4

 

%

 

 

 

 

 

 

 

 

 

 

 

412,724

 

 

 

402,729

 

 

 

399,064

 

 

 

7.0

 

%

Consumer products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Feradyne Outdoors, LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 6.25%

 

 

5/25/2023

 

 

88,400

 

 

 

87,966

 

 

 

88,400

 

 

 

1.5

 

%

WU Holdco, Inc. (dba Weiman Products, LLC)(4)(6)(24)

 

First lien senior secured loan

 

L + 5.25%

 

 

3/26/2026

 

 

158,092

 

 

 

155,688

 

 

 

157,697

 

 

 

2.7

 

%

5


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

WU Holdco, Inc. (dba Weiman Products, LLC)(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 5.25%

 

 

3/26/2025

 

 

5,378

 

 

 

5,091

 

 

 

5,330

 

 

 

0.1

 

%

 

 

 

 

 

 

 

 

 

 

 

251,870

 

 

 

248,745

 

 

 

251,427

 

 

 

4.3

 

%

Containers and packaging

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pregis Topco LLC(4)(5)(22)(24)

 

First lien senior secured loan

 

L + 3.75%

 

 

7/31/2026

 

 

861

 

 

 

818

 

 

 

854

 

 

 

 

%

Pregis Topco LLC(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.75%

 

 

7/30/2027

 

 

215,033

 

 

 

211,334

 

 

 

213,959

 

 

 

3.7

 

%

 

 

 

 

 

 

 

 

 

 

 

215,894

 

 

 

212,152

 

 

 

214,813

 

 

 

3.7

 

%

Distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ABB/Con-cise Optical Group LLC(4)(7)

 

First lien senior secured loan

 

L + 5.00%

 

 

6/15/2023

 

 

75,423

 

 

 

74,909

 

 

 

71,652

 

 

 

1.2

 

%

ABB/Con-cise Optical Group LLC(4)(7)

 

Second lien senior secured loan

 

L + 9.00%

 

 

6/17/2024

 

 

25,000

 

 

 

24,629

 

 

 

23,000

 

 

 

0.4

 

%

Aramsco, Inc.(4)(5)(24)

 

First lien senior secured loan

 

L + 5.25%

 

 

8/28/2024

 

 

56,333

 

 

 

55,475

 

 

 

56,051

 

 

 

1.0

 

%

Aramsco, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.25%

 

 

8/28/2024

 

 

-

 

 

 

(119

)

 

 

(42

)

 

 

 

%

Endries Acquisition, Inc.(4)(7)(24)

 

First lien senior secured loan

 

L + 6.25%

 

 

12/10/2025

 

 

201,705

 

 

 

199,163

 

 

 

199,183

 

 

 

3.4

 

%

Endries Acquisition, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.25%

 

 

12/10/2024

 

 

-

 

 

 

(291

)

 

 

(338

)

 

 

 

%

Individual Foodservice Holdings, LLC(4)(7)(24)

 

First lien senior secured loan

 

L + 6.25%

 

 

11/22/2025

 

 

141,936

 

 

 

139,537

 

 

 

140,517

 

 

 

2.4

 

%

Individual Foodservice Holdings, LLC(4)(7)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 6.25%

 

 

6/30/2022

 

 

13,664

 

 

 

13,078

 

 

 

13,312

 

 

 

0.2

 

%

Individual Foodservice Holdings, LLC(4)(5)(16)(24)

 

First lien senior secured revolving loan

 

L + 6.25%

 

 

11/22/2024

 

 

3,834

 

 

 

3,495

 

 

 

3,619

 

 

 

0.1

 

%

JM Swank, LLC(4)(6)

 

First lien senior secured loan

 

L + 7.50%

 

 

7/25/2022

 

 

114,663

 

 

 

113,986

 

 

 

114,663

 

 

 

2.0

 

%

Offen, Inc.(4)(5)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

6/22/2026

 

 

19,729

 

 

 

19,577

 

 

 

19,336

 

 

 

0.3

 

%

QC Supply, LLC(4)(5)

 

First lien senior secured loan

 

L + 7.00% (incl. 1.00% PIK)

 

 

12/29/2022

 

 

34,397

 

 

 

34,118

 

 

 

28,893

 

 

 

0.5

 

%

QC Supply, LLC(4)(5)(16)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

12/29/2021

 

 

4,336

 

 

 

4,318

 

 

 

3,541

 

 

 

0.1

 

%

 

 

 

 

 

 

 

 

 

 

 

691,020

 

 

 

681,875

 

 

 

673,387

 

 

 

11.6

 

%

Education

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Instructure, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 7.00%

 

 

3/24/2026

 

 

79,663

 

 

 

78,512

 

 

 

79,663

 

 

 

1.4

 

%

Instructure, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

3/24/2026

 

 

-

 

 

 

(58

)

 

 

-

 

 

 

 

%

6


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Learning Care Group (US) No. 2 Inc.(4)(7)(24)

 

Second lien senior secured loan

 

L + 7.50%

 

 

3/13/2026

 

 

26,967

 

 

 

26,620

 

 

 

25,281

 

 

 

0.4

 

%

Severin Acquisition, LLC (dba PowerSchool)(4)(5)(24)

 

Second lien senior secured loan

 

L + 6.75%

 

 

8/3/2026

 

 

87,000

 

 

 

86,471

 

 

 

85,913

 

 

 

1.5

 

%

TSB Purchaser, Inc. (dba Teaching Strategies, Inc.)(4)(6)(24)

 

First lien senior secured loan

 

L + 6.00%

 

 

5/14/2024

 

 

61,423

 

 

 

60,540

 

 

 

61,116

 

 

 

1.1

 

%

TSB Purchaser, Inc. (dba Teaching Strategies, Inc.)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.00%

 

 

5/14/2024

 

 

-

 

 

 

(55

)

 

 

(21

)

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

255,053

 

 

 

252,030

 

 

 

251,952

 

 

 

4.4

 

%

Energy equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liberty Oilfield Services LLC(4)(5)(20)(24)

 

First lien senior secured loan

 

L + 7.63%

 

 

9/19/2022

 

 

13,703

 

 

 

13,619

 

 

 

13,703

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

 

 

13,703

 

 

 

13,619

 

 

 

13,703

 

 

 

0.2

 

%

Financial services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AxiomSL Group, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

12/3/2027

 

 

78,463

 

 

 

77,328

 

 

 

78,070

 

 

 

1.3

 

%

AxiomSL Group, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.50%

 

 

12/3/2025

 

 

-

 

 

 

(131

)

 

 

(47

)

 

 

 

%

Blackhawk Network Holdings, Inc.(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.00%

 

 

6/15/2026

 

 

106,400

 

 

 

105,674

 

 

 

103,740

 

 

 

1.8

 

%

Hg Genesis 8 Sumoco Limited(4)(12)(20)(24)

 

Unsecured facility

 

G + 7.50% (incl. 7.50% PIK)

 

 

8/28/2025

 

 

45,922

 

 

 

43,872

 

 

 

46,037

 

 

 

0.8

 

%

Hg Saturn Luchaco Limited(4)(12)(20)(24)

 

Unsecured facility

 

G + 7.50% (incl. 7.50% PIK)

 

 

3/30/2026

 

 

131,072

 

 

 

130,139

 

 

 

129,433

 

 

 

2.2

 

%

NMI Acquisitionco, Inc. (dba Network Merchants)(4)(5)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

9/6/2023

 

 

35,589

 

 

 

35,165

 

 

 

35,322

 

 

 

0.6

 

%

NMI Acquisitionco, Inc. (dba Network Merchants)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.00%

 

 

9/6/2023

 

 

-

 

 

 

(5

)

 

 

(5

)

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

397,446

 

 

 

392,042

 

 

 

392,550

 

 

 

6.7

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Caiman Merger Sub LLC (dba City Brewing)(4)(6)(24)

 

First lien senior secured loan

 

L + 5.25%

 

 

11/3/2025

 

 

174,905

 

 

 

173,508

 

 

 

176,654

 

 

 

3.0

 

%

Caiman Merger Sub LLC (dba City Brewing)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.25%

 

 

11/1/2024

 

 

-

 

 

 

(92

)

 

 

-

 

 

 

 

%

CM7 Restaurant Holdings, LLC(4)(5)(24)

 

First lien senior secured loan

 

L + 8.00%

 

 

5/22/2023

 

 

38,507

 

 

 

37,991

 

 

 

37,930

 

 

 

0.7

 

%

H-Food Holdings, LLC(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.00%

 

 

3/2/2026

 

 

121,800

 

 

 

119,633

 

 

 

121,800

 

 

 

2.1

 

%

Hometown Food Company(4)(5)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

8/31/2023

 

 

21,041

 

 

 

20,823

 

 

 

21,041

 

 

 

0.4

 

%

Hometown Food Company(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.00%

 

 

8/31/2023

 

 

-

 

 

 

(41

)

 

 

-

 

 

 

 

%

7


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Manna Development Group, LLC(4)(5)(24)

 

First lien senior secured loan

 

L + 6.75%

 

 

10/24/2022

 

 

51,957

 

 

 

51,666

 

 

 

49,359

 

 

 

0.9

 

%

Manna Development Group, LLC(4)(5)(24)

 

First lien senior secured revolving loan

 

L + 6.75%

 

 

10/24/2022

 

 

3,143

 

 

 

3,099

 

 

 

2,986

 

 

 

0.1

 

%

Nellson Nutraceutical, LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 5.25%

 

 

12/23/2023

 

 

27,498

 

 

 

26,557

 

 

 

26,673

 

 

 

0.5

 

%

Nutraceutical International Corporation(4)(5)(24)

 

First lien senior secured loan

 

L + 7.00%

 

 

9/30/2026

 

 

215,897

 

 

 

212,881

 

 

 

214,818

 

 

 

3.7

 

%

Nutraceutical International Corporation(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

9/30/2025

 

 

-

 

 

 

(183

)

 

 

(68

)

 

 

 

%

Recipe Acquisition Corp. (dba Roland Corporation)(4)(6)

 

Second lien senior secured loan

 

L + 9.00%

 

 

12/1/2022

 

 

32,000

 

 

 

31,798

 

 

 

25,920

 

 

 

0.4

 

%

Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(4)(5)(24)

 

First lien senior secured loan

 

L + 4.50%

 

 

7/30/2025

 

 

44,200

 

 

 

43,623

 

 

 

42,321

 

 

 

0.7

 

%

Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(4)(5)(16)(24)

 

First lien senior secured revolving loan

 

L + 4.50%

 

 

7/30/2023

 

 

5,640

 

 

 

5,546

 

 

 

5,258

 

 

 

0.1

 

%

Shearer's Foods, LLC(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.75%

 

 

9/22/2028

 

 

120,000

 

 

 

118,855

 

 

 

119,699

 

 

 

2.1

 

%

Tall Tree Foods, Inc.(4)(5)

 

First lien senior secured loan

 

L + 7.25%

 

 

8/12/2022

 

 

48,134

 

 

 

47,993

 

 

 

48,134

 

 

 

0.8

 

%

Ultimate Baked Goods Midco, LLC(4)(5)(24)

 

First lien senior secured loan

 

L + 4.00%

 

 

8/11/2025

 

 

26,392

 

 

 

25,996

 

 

 

25,997

 

 

 

0.4

 

%

Ultimate Baked Goods Midco, LLC(4)(5)(16)(24)

 

First lien senior secured revolving loan

 

L + 4.00%

 

 

8/9/2023

 

 

635

 

 

 

581

 

 

 

559

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

931,749

 

 

 

920,234

 

 

 

919,081

 

 

 

15.9

 

%

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PATRIOT ACQUISITION TOPCO S.À R.L. (dba Corza Health, Inc.)(4)(6)(24)

 

First lien senior secured loan

 

L + 6.75%

 

 

1/29/2028

 

 

132,476

 

 

 

130,191

 

 

 

130,092

 

 

 

2.2

 

%

PATRIOT ACQUISITION TOPCO S.À R.L. (dba Corza Health, Inc.)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.75%

 

 

1/29/2026

 

 

-

 

 

 

(271

)

 

 

(244

)

 

 

 

%

Nelipak Holding Company(4)(7)(24)

 

First lien senior secured loan

 

L + 4.25%

 

 

7/2/2026

 

 

47,400

 

 

 

46,653

 

 

 

46,215

 

 

 

0.8

 

%

Nelipak Holding Company(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 4.25%

 

 

7/2/2024

 

 

4,422

 

 

 

4,326

 

 

 

4,238

 

 

 

0.1

 

%

Nelipak Holding Company(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 4.50%

 

 

7/2/2024

 

 

-

 

 

 

(283

)

 

 

(194

)

 

 

 

%

Nelipak Holding Company(4)(7)(24)

 

Second lien senior secured loan

 

L + 8.25%

 

 

7/2/2027

 

 

67,006

 

 

 

66,160

 

 

 

65,331

 

 

 

1.1

 

%

Nelipak Holding Company(4)(10)(24)

 

Second lien senior secured loan

 

E + 8.50%

 

 

7/2/2027

 

 

70,636

 

 

 

66,412

 

 

 

67,810

 

 

 

1.2

 

%

Packaging Coordinators Midco, Inc.(4)(7)(24)

 

Second lien senior secured loan

 

L + 8.25%

 

 

11/30/2028

 

 

195,044

 

 

 

191,257

 

 

 

192,117

 

 

 

3.3

 

%

 

 

 

 

 

 

 

 

 

 

 

516,984

 

 

 

504,445

 

 

 

505,365

 

 

 

8.7

 

 

8


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Healthcare providers and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Barracuda Dental LLC (dba National Dentex)(4)(6)(24)

 

First lien senior secured loan

 

L + 7.00%

 

 

10/27/2025

 

 

61,893

 

 

 

60,867

 

 

 

61,119

 

 

 

1.1

 

%

Barracuda Dental LLC (dba National Dentex)(4)(16)(18)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 7.00%

 

 

6/30/2022

 

 

-

 

 

 

(100

)

 

 

-

 

 

 

 

%

Barracuda Dental LLC (dba National Dentex)(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

10/27/2025

 

 

5,385

 

 

 

5,232

 

 

 

5,268

 

 

 

0.1

 

%

Confluent Health, LLC.(4)(5)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

6/24/2026

 

 

17,685

 

 

 

17,550

 

 

 

17,464

 

 

 

0.3

 

%

GI CCLS Acquisition LLC (fka GI Chill Acquisition LLC)(4)(6)(24)

 

Second lien senior secured loan

 

L + 7.50%

 

 

8/6/2026

 

 

135,400

 

 

 

134,395

 

 

 

134,385

 

 

 

2.3

 

%

KS Management Services, L.L.C.(4)(5)(24)

 

First lien senior secured loan

 

L + 4.25%

 

 

1/9/2026

 

 

123,437

 

 

 

122,170

 

 

 

123,437

 

 

 

2.1

 

%

Premier Imaging, LLC (dba LucidHealth)(4)(5)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

1/2/2025

 

 

43,827

 

 

 

43,228

 

 

 

43,280

 

 

 

0.7

 

%

Refresh Parent Holdings, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

12/9/2026

 

 

89,648

 

 

 

88,359

 

 

 

88,751

 

 

 

1.5

 

%

Refresh Parent Holdings, Inc.(4)(6)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 6.50%

 

 

6/9/2022

 

 

16,038

 

 

 

15,608

 

 

 

15,877

 

 

 

0.3

 

%

Refresh Parent Holdings, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.50%

 

 

12/9/2026

 

 

-

 

 

 

(153

)

 

 

(108

)

 

 

 

%

TC Holdings, LLC (dba TrialCard)(4)(6)(24)

 

First lien senior secured loan

 

L + 4.50%

 

 

11/14/2023

 

 

83,110

 

 

 

82,287

 

 

 

83,110

 

 

 

1.4

 

%

TC Holdings, LLC (dba TrialCard)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 4.50%

 

 

11/14/2022

 

 

-

 

 

 

(50

)

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

576,423

 

 

 

569,393

 

 

 

572,583

 

 

 

9.8

 

%

Healthcare technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bracket Intermediate Holding Corp.(4)(6)(24)

 

First lien senior secured loan

 

L + 4.25%

 

 

9/5/2025

 

 

520

 

 

 

485

 

 

 

517

 

 

 

 

%

Bracket Intermediate Holding Corp.(4)(6)(24)

 

Second lien senior secured loan

 

L + 8.13%

 

 

9/7/2026

 

 

26,250

 

 

 

25,852

 

 

 

25,922

 

 

 

0.4

 

%

Definitive Healthcare Holdings, LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 5.50%

 

 

7/16/2026

 

 

169,856

 

 

 

168,536

 

 

 

169,007

 

 

 

2.9

 

%

Definitive Healthcare Holdings, LLC(4)(6)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 5.50%

 

 

7/16/2021

 

 

6,706

 

 

 

6,465

 

 

 

6,672

 

 

 

0.1

 

%

Definitive Healthcare Holdings, LLC(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.50%

 

 

7/16/2024

 

 

-

 

 

 

(62

)

 

 

(47

)

 

 

 

%

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(4)(6)(20)(24)

 

First lien senior secured loan

 

L + 6.25%

 

 

2/20/2026

 

 

90,762

 

 

 

89,753

 

 

 

89,854

 

 

 

1.5

 

%

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(4)(16)(18)(19)(20)(24)

 

First lien senior secured delayed draw term loan

 

L + 6.25%

 

 

8/16/2021

 

 

-

 

 

 

(75

)

 

 

(62

)

 

 

 

%

9


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(4)(6)(16)(20)(24)

 

First lien senior secured revolving loan

 

L + 6.25%

 

 

2/20/2026

 

 

1,126

 

 

 

1,068

 

 

 

1,070

 

 

 

 

%

Interoperability Bidco, Inc.(4)(7)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

6/25/2026

 

 

75,849

 

 

 

75,098

 

 

 

73,763

 

 

 

1.3

 

%

Interoperability Bidco, Inc.(4)(16)(18)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 5.75%

 

 

6/25/2021

 

 

-

 

 

 

(7

)

 

 

(130

)

 

 

 

%

Interoperability Bidco, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

6/25/2024

 

 

-

 

 

 

(32

)

 

 

(110

)

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

371,069

 

 

 

367,081

 

 

 

366,456

 

 

 

6.2

 

%

Household products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hayward Industries, Inc.(4)(5)(22)(24)

 

First lien senior secured loan

 

L + 3.50%

 

 

8/5/2024

 

 

785

 

 

 

771

 

 

 

784

 

 

 

 

%

HGH Purchaser, Inc. (dba Horizon Services)(4)(6)(24)

 

First lien senior secured loan

 

L + 6.75%

 

 

11/3/2025

 

 

76,788

 

 

 

75,864

 

 

 

75,252

 

 

 

1.3

 

%

HGH Purchaser, Inc. (dba Horizon Services)(4)(6)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 6.75%

 

 

2/10/2023

 

 

28,250

 

 

 

27,470

 

 

 

27,351

 

 

 

0.5

 

%

HGH Purchaser, Inc. (dba Horizon Services)(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 6.75%

 

 

11/3/2025

 

 

486

 

 

 

375

 

 

 

292

 

 

 

 

%

Walker Edison Furniture Company LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

3/31/2027

 

 

125,000

 

 

 

123,125

 

 

 

123,124

 

 

 

2.1

 

%

 

 

 

 

 

 

 

 

 

 

 

231,309

 

 

 

227,605

 

 

 

226,803

 

 

 

3.9

 

%

Human resource support services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Ultimate Software Group, Inc.(4)(6)(24)

 

Second lien senior secured loan

 

L + 6.75%

 

 

5/3/2027

 

 

1,592

 

 

 

1,578

 

 

 

1,624

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

1,592

 

 

 

1,578

 

 

 

1,624

 

 

 

 

%

Infrastructure and environmental services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FR Arsenal Holdings II Corp. (dba Applied-Cleveland Holdings, Inc.)(4)(7)

 

First lien senior secured loan

 

L + 7.50%

 

 

9/8/2022

 

 

120,989

 

 

 

120,340

 

 

 

115,544

 

 

 

2.0

 

%

LineStar Integrity Services LLC(4)(7)(24)

 

First lien senior secured loan

 

L + 7.25%

 

 

2/12/2024

 

 

88,625

 

 

 

87,868

 

 

 

77,989

 

 

 

1.3

 

%

 

 

 

 

 

 

 

 

 

 

 

209,614

 

 

 

208,208

 

 

 

193,533

 

 

 

3.3

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ardonagh Midco 3 PLC(4)(11)(20)(24)

 

First lien senior secured loan

 

E + 7.71% (incl. 2.27% PIK)

 

 

7/14/2026

 

 

10,615

 

 

 

9,856

 

 

 

10,615

 

 

 

0.2

 

%

Ardonagh Midco 3 PLC(4)(12)(20)(24)

 

First lien senior secured loan

 

G + 7.71% (incl. 2.27% PIK)

 

 

7/14/2026

 

 

97,791

 

 

 

85,091

 

 

 

97,791

 

 

 

1.7

 

%

Ardonagh Midco 3 PLC(4)(12)(16)(19)(20)(24)

 

First lien senior secured delayed draw term loan

 

G + 7.71% (incl. 2.27% PIK)

 

 

7/14/2022

 

 

13,687

 

 

 

13,127

 

 

 

13,687

 

 

 

0.2

 

%

Ardonagh Midco 2 PLC(20)(24)(26)

 

Unsecured notes

 

11.50%

 

 

1/15/2027

 

 

9,896

 

 

 

9,812

 

 

 

10,629

 

 

 

0.2

 

%

10


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Integrity Marketing Acquisition, LLC(4)(7)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

8/27/2025

 

 

220,551

 

 

 

217,633

 

 

 

218,346

 

 

 

3.8

 

%

Integrity Marketing Acquisition, LLC(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

8/27/2025

 

 

-

 

 

 

(163

)

 

 

(148

)

 

 

 

%

KWOR Acquisition, Inc. (dba Alacrity Solutions)(4)(5)(24)

 

First lien senior secured loan

 

L + 4.00%

 

 

6/3/2026

 

 

22,318

 

 

 

21,760

 

 

 

21,872

 

 

 

0.4

 

%

KWOR Acquisition, Inc. (dba Alacrity Solutions)(4)(9)(16)(24)

 

First lien senior secured revolving loan

 

P + 2.25%

 

 

6/3/2024

 

 

1,040

 

 

 

966

 

 

 

936

 

 

 

 

%

KWOR Acquisition, Inc. (dba Alacrity Solutions)(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.75%

 

 

12/3/2026

 

 

62,000

 

 

 

61,213

 

 

 

61,225

 

 

 

1.1

 

%

Norvax, LLC (dba GoHealth)(4)(6)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

9/15/2025

 

 

198,853

 

 

 

194,777

 

 

 

199,846

 

 

 

3.4

 

%

Norvax, LLC (dba GoHealth)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.50%

 

 

9/13/2024

 

 

-

 

 

 

(127

)

 

 

-

 

 

 

 

%

Peter C. Foy & Associated Insurance Services, LLC(4)(7)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

3/31/2026

 

 

131,598

 

 

 

129,967

 

 

 

131,598

 

 

 

2.3

 

%

Peter C. Foy & Associated Insurance Services, LLC(4)(6)(16)(19)(24)

 

First lien senior secured delayed draw term loan C

 

L + 6.50%

 

 

9/30/2021

 

 

30,602

 

 

 

30,004

 

 

 

30,602

 

 

 

0.5

 

%

Peter C. Foy & Associated Insurance Services, LLC(4)(16)(18)(19)(24)

 

First lien senior secured delayed draw term loan D

 

L + 6.50%

 

 

9/12/2022

 

 

-

 

 

 

(141

)

 

 

-

 

 

 

 

%

Peter C. Foy & Associated Insurance Services, LLC(4)(7)(16)(24)

 

First lien senior secured revolving loan

 

L + 6.50%

 

 

3/31/2026

 

 

2,551

 

 

 

2,436

 

 

 

2,551

 

 

 

 

%

RSC Acquisition, Inc (dba Risk Strategies)(4)(6)(24)

 

First lien senior secured loan

 

L + 5.50%

 

 

10/30/2026

 

 

29,343

 

 

 

28,854

 

 

 

28,976

 

 

 

0.5

 

%

RSC Acquisition, Inc (dba Risk Strategies)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.50%

 

 

10/30/2026

 

 

-

 

 

 

(15

)

 

 

(12

)

 

 

 

%

THG Acquisition, LLC (dba Hilb)(4)(6)(24)

 

First lien senior secured loan

 

L + 5.95%

 

 

12/2/2026

 

 

98,488

 

 

 

96,333

 

 

 

96,877

 

 

 

1.7

 

%

THG Acquisition, LLC (dba Hilb)(4)(6)(16)(19)

 

First lien senior secured delayed draw term loan

 

L + 6.25%

 

 

12/2/2021

 

 

4,002

 

 

 

3,508

 

 

 

3,952

 

 

 

0.1

 

%

THG Acquisition, LLC (dba Hilb)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

12/2/2025

 

 

-

 

 

 

(179

)

 

 

(150

)

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

933,335

 

 

 

904,712

 

 

 

929,193

 

 

 

16.1

 

%

Internet software and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3ES Innovation Inc. (dba Aucerna)(4)(6)(20)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

5/13/2025

 

 

39,627

 

 

 

39,265

 

 

 

38,637

 

 

 

0.7

 

%

3ES Innovation Inc. (dba Aucerna)(4)(16)(18)(20)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

5/13/2025

 

 

-

 

 

 

(33

)

 

 

(97

)

 

 

 

%

Accela, Inc.(4)(5)

 

First lien senior secured loan

 

L + 4.93% (incl. 1.68% PIK)

 

 

9/28/2023

 

 

22,183

 

 

 

21,982

 

 

 

22,183

 

 

 

0.4

 

%

11


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Accela, Inc.(4)(16)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

9/28/2023

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

%

Apptio, Inc.(4)(7)(24)

 

First lien senior secured loan

 

L + 7.25%

 

 

1/10/2025

 

 

50,916

 

 

 

50,024

 

 

 

50,789

 

 

 

0.9

 

%

Apptio, Inc.(4)(7)(16)(24)

 

First lien senior secured revolving loan

 

L + 7.25%

 

 

1/10/2025

 

 

1,112

 

 

 

1,077

 

 

 

1,105

 

 

 

 

%

BCPE Nucleon (DE) SPV, LP(4)(7)(24)

 

First lien senior secured loan

 

L + 7.00%

 

 

9/24/2026

 

 

189,778

 

 

 

187,048

 

 

 

187,880

 

 

 

3.2

 

%

BCTO BSI Buyer, Inc. (dba Buildertrend)(4)(6)(24)

 

First lien senior secured loan

 

L + 7.00%

 

 

12/23/2026

 

 

44,643

 

 

 

44,212

 

 

 

44,420

 

 

 

0.8

 

%

BCTO BSI Buyer, Inc. (dba Buildertrend)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

12/23/2026

 

 

-

 

 

 

(51

)

 

 

(27

)

 

 

 

%

Centrify Corporation(4)(6)(24)

 

First lien senior secured loan

 

L + 6.00%

 

 

3/2/2028

 

 

34,346

 

 

 

33,499

 

 

 

33,488

 

 

 

0.6

 

%

Centrify Corporation(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.00%

 

 

3/2/2027

 

 

-

 

 

 

(90

)

 

 

(91

)

 

 

 

%

Delta TopCo, Inc. (dba Infoblox, Inc.)(4)(7)(24)

 

Second lien senior secured loan

 

L + 7.25%

 

 

12/1/2028

 

 

15,000

 

 

 

14,928

 

 

 

15,000

 

 

 

0.3

 

%

Forescout Technologies, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 9.50% (incl. 9.50% PIK)

 

 

8/17/2026

 

 

51,018

 

 

 

50,241

 

 

 

50,635

 

 

 

0.9

 

%

Forescout Technologies, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 8.50%

 

 

8/18/2025

 

 

-

 

 

 

(82

)

 

 

(40

)

 

 

 

%

Genesis Acquisition Co. (dba Procare Software)(4)(6)(24)

 

First lien senior secured loan

 

L + 4.00%

 

 

7/31/2024

 

 

18,269

 

 

 

18,054

 

 

 

17,583

 

 

 

0.3

 

%

Genesis Acquisition Co. (dba Procare Software)(4)(6)(24)

 

First lien senior secured revolving loan

 

L + 4.00%

 

 

7/31/2024

 

 

2,637

 

 

 

2,608

 

 

 

2,538

 

 

 

 

%

Granicus, Inc.(4)(7)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

1/29/2027

 

 

10,596

 

 

 

10,346

 

 

 

10,358

 

 

 

0.2

 

%

Granicus, Inc.(4)(16)(18)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 6.50%

 

 

1/30/2023

 

 

-

 

 

 

(48

)

 

 

(45

)

 

 

 

%

Granicus, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.50%

 

 

1/29/2027

 

 

-

 

 

 

(28

)

 

 

(27

)

 

 

 

%

H&F Opportunities LUX III S.À R.L (dba Checkmarx)(4)(7)(20)(24)

 

First lien senior secured loan

 

L + 7.75%

 

 

4/16/2026

 

 

42,250

 

 

 

41,142

 

 

 

42,250

 

 

 

0.7

 

%

H&F Opportunities LUX III S.À R.L (dba Checkmarx)(4)(16)(18)(20)(24)

 

First lien senior secured revolving loan

 

L + 7.75%

 

 

4/16/2026

 

 

-

 

 

 

(409

)

 

 

-

 

 

 

 

%

Hyland Software, Inc.(4)(5)(24)

 

Second lien senior secured loan

 

L + 7.00%

 

 

7/7/2025

 

 

24,705

 

 

 

24,387

 

 

 

24,705

 

 

 

0.4

 

%

IQN Holding Corp. (dba Beeline)(4)(6)(24)

 

First lien senior secured loan

 

L + 5.50%

 

 

8/20/2024

 

 

189,470

 

 

 

187,715

 

 

 

188,996

 

 

 

3.3

 

%

12


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

IQN Holding Corp. (dba Beeline)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.50%

 

 

8/21/2023

 

 

-

 

 

 

(162

)

 

 

(57

)

 

 

 

%

Lightning Midco, LLC (dba Vector Solutions)(4)(7)(24)

 

First lien senior secured loan

 

L + 5.50%

 

 

11/21/2025

 

 

138,550

 

 

 

137,577

 

 

 

138,204

 

 

 

2.4

 

%

Lightning Midco, LLC (dba Vector Solutions)(4)(7)(16)(24)

 

First lien senior secured revolving loan

 

L + 5.50%

 

 

11/21/2023

 

 

4,409

 

 

 

4,339

 

 

 

4,376

 

 

 

0.1

 

%

Litera Bidco LLC(4)(5)(24)

 

First lien senior secured loan

 

L + 5.85%

 

 

5/29/2026

 

 

106,925

 

 

 

105,680

 

 

 

106,658

 

 

 

1.8

 

%

Litera Bidco LLC(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

5/30/2025

 

 

-

 

 

 

(53

)

 

 

(14

)

 

 

 

%

MINDBODY, Inc.(4)(7)(24)

 

First lien senior secured loan

 

L + 8.50% (incl. 1.50% PIK)

 

 

2/14/2025

 

 

58,405

 

 

 

58,001

 

 

 

54,317

 

 

 

0.9

 

%

MINDBODY, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

2/14/2025

 

 

-

 

 

 

(39

)

 

 

(425

)

 

 

 

%

Trader Interactive, LLC (fka Dominion Web Solutions, LLC)(4)(6)(24)

 

First lien senior secured loan

 

L + 6.25%

 

 

6/17/2024

 

 

132,224

 

 

 

131,234

 

 

 

131,561

 

 

 

2.3

 

%

Trader Interactive, LLC (fka Dominion Web Solutions, LLC)(4)(5)(16)(24)

 

First lien senior secured revolving loan

 

L + 6.25%

 

 

6/15/2023

 

 

426

 

 

 

390

 

 

 

394

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

1,177,489

 

 

 

1,162,754

 

 

 

1,165,254

 

 

 

20.2

 

%

Leisure and entertainment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Troon Golf, L.L.C.(4)(6)(15)(24)

 

First lien senior secured term loan A and B

 

L + 5.50%

(TLA: L + 3.5%; TLB: L + 5.98%)

 

 

3/29/2025

 

 

213,812

 

 

 

211,721

 

 

 

213,812

 

 

 

3.7

 

%

Troon Golf, L.L.C.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.50%

 

 

3/29/2025

 

 

-

 

 

 

(90

)

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

213,812

 

 

 

211,631

 

 

 

213,812

 

 

 

3.7

 

%

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gloves Buyer, Inc. (dba Protective Industrial Products)(4)(5)(24)

 

Second lien senior secured loan

 

L + 8.25%

 

 

12/29/2028

 

 

29,250

 

 

 

28,535

 

 

 

28,665

 

 

 

0.5

 

%

Ideal Tridon Holdings, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

7/31/2024

 

 

53,285

 

 

 

52,777

 

 

 

52,751

 

 

 

0.9

 

%

Ideal Tridon Holdings, Inc.(4)(5)(16)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

7/31/2023

 

 

900

 

 

 

864

 

 

 

842

 

 

 

 

%

MHE Intermediate Holdings, LLC (dba Material Handling Services)(4)(6)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

3/8/2024

 

 

23,674

 

 

 

23,531

 

 

 

23,082

 

 

 

0.4

 

%

PHM Netherlands Midco B.V. (dba Loparex)(4)(6)(24)

 

Second lien senior secured loan

 

L + 8.75%

 

 

8/2/2027

 

 

112,000

 

 

 

105,313

 

 

 

108,079

 

 

 

1.9

 

%

PHM Netherlands Midco B.V. (dba Loparex)(4)(6)(24)

 

First lien senior secured loan

 

L + 4.50%

 

 

7/31/2026

 

 

792

 

 

 

737

 

 

 

784

 

 

 

 

%

Professional Plumbing Group, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 6.75%

 

 

4/16/2024

 

 

51,549

 

 

 

51,110

 

 

 

49,229

 

 

 

0.8

 

%

13


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Professional Plumbing Group, Inc.(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 6.75%

 

 

4/16/2023

 

 

6,643

 

 

 

6,589

 

 

 

6,085

 

 

 

0.1

 

%

Safety Products/JHC Acquisition Corp. (dba Justrite Safety Group)(4)(5)(24)

 

First lien senior secured loan

 

L + 4.50%

 

 

6/28/2026

 

 

13,311

 

 

 

13,207

 

 

 

12,079

 

 

 

0.2

 

%

Safety Products/JHC Acquisition Corp. (dba Justrite Safety Group)(4)(5)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 4.50%

 

 

6/28/2021

 

 

720

 

 

 

707

 

 

 

568

 

 

 

 

%

Sonny's Enterprises LLC(4)(5)(24)

 

First lien senior secured loan

 

L + 7.00%

 

 

8/5/2026

 

 

226,057

 

 

 

221,932

 

 

 

226,057

 

 

 

3.9

 

%

Sonny's Enterprises LLC(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

8/5/2025

 

 

-

 

 

 

(312

)

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

518,181

 

 

 

504,990

 

 

 

508,221

 

 

 

8.7

 

%

Oil and gas

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Black Mountain Sand Eagle Ford LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 8.25%

 

 

8/17/2022

 

 

45,814

 

 

 

45,649

 

 

 

41,462

 

 

 

0.7

 

%

Project Power Buyer, LLC (dba PEC-Veriforce)(4)(6)(24)

 

First lien senior secured loan

 

L + 6.25%

 

 

5/14/2026

 

 

45,437

 

 

 

44,945

 

 

 

45,210

 

 

 

0.8

 

%

Project Power Buyer, LLC (dba PEC-Veriforce)(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 6.25%

 

 

5/14/2025

 

 

-

 

 

 

(27

)

 

 

(16

)

 

 

 

%

Zenith Energy U.S. Logistics Holdings, LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

12/20/2024

 

 

95,365

 

 

 

94,068

 

 

 

94,649

 

 

 

1.6

 

%

 

 

 

 

 

 

 

 

 

 

 

186,616

 

 

 

184,635

 

 

 

181,305

 

 

 

3.1

 

%

Professional services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Amspec Services Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

7/2/2024

 

 

111,119

 

 

 

109,883

 

 

 

109,174

 

 

 

1.9

 

%

Amspec Services Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 4.75%

 

 

7/2/2024

 

 

-

 

 

 

(137

)

 

 

(253

)

 

 

 

%

Cardinal US Holdings, Inc.(4)(5)(20)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

7/31/2023

 

 

89,042

 

 

 

86,974

 

 

 

89,042

 

 

 

1.5

 

%

DMT Solutions Global Corporation(4)(6)(24)

 

First lien senior secured loan

 

L + 7.50%

 

 

7/2/2024

 

 

56,333

 

 

 

54,974

 

 

 

54,502

 

 

 

0.9

 

%

GC Agile Holdings Limited (dba Apex Fund Services)(4)(6)(20)(24)

 

First lien senior secured loan

 

L + 7.00%

 

 

6/15/2025

 

 

158,455

 

 

 

156,423

 

 

 

156,475

 

 

 

2.7

 

%

GC Agile Holdings Limited (dba Apex Fund Services)(4)(16)(18)(20)(24)

 

First lien senior secured revolving loan

 

L + 7.00%

 

 

6/15/2023

 

 

-

 

 

 

(147

)

 

 

(130

)

 

 

 

%

Gerson Lehrman Group, Inc.(4)(7)(24)

 

First lien senior secured loan

 

L + 4.75%

 

 

12/12/2024

 

 

145,527

 

 

 

144,575

 

 

 

145,527

 

 

 

2.5

 

%

Gerson Lehrman Group, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 4.75%

 

 

12/12/2024

 

 

-

 

 

 

(133

)

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

560,476

 

 

 

552,412

 

 

 

554,337

 

 

 

9.5

 

%

Specialty retail

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BIG Buyer, LLC(4)(7)(24)

 

First lien senior secured loan

 

L + 6.50%

 

 

11/20/2023

 

 

48,931

 

 

 

48,214

 

 

 

48,196

 

 

 

0.8

 

%

BIG Buyer, LLC(4)(5)(16)(24)

 

First lien senior secured revolving loan

 

L + 6.50%

 

 

11/20/2023

 

 

1,500

 

 

 

1,437

 

 

 

1,444

 

 

 

 

%

EW Holdco, LLC (dba European Wax)(4)(5)(24)

 

First lien senior secured loan

 

L + 5.50%

 

 

9/25/2024

 

 

71,116

 

 

 

70,667

 

 

 

68,272

 

 

 

1.2

 

%

14


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Galls, LLC(4)(6)(24)

 

First lien senior secured loan

 

L + 6.75% (incl. 0.50% PIK)

 

 

1/31/2025

 

 

105,139

 

 

 

104,210

 

 

 

97,780

 

 

 

1.7

 

%

Galls, LLC(4)(6)(16)(24)

 

First lien senior secured revolving loan

 

L + 6.75% (incl. 0.50% PIK)

 

 

1/31/2024

 

 

16,558

 

 

 

16,396

 

 

 

15,079

 

 

 

0.3

 

%

 

 

 

 

 

 

 

 

 

 

 

243,244

 

 

 

240,924

 

 

 

230,771

 

 

 

4.0

 

%

Telecommunications

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Park Place Technologies, LLC(4)(5)(24)

 

First lien senior secured loan

 

L + 5.00%

 

 

11/10/2027

 

 

9,000

 

 

 

8,656

 

 

 

8,730

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

 

 

9,000

 

 

 

8,656

 

 

 

8,730

 

 

 

0.2

 

%

Transportation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lazer Spot G B Holdings, Inc.(4)(6)(24)

 

First lien senior secured loan

 

L + 5.75%

 

 

12/9/2025

 

 

145,164

 

 

 

143,109

 

 

 

144,800

 

 

 

2.5

 

%

Lazer Spot G B Holdings, Inc.(4)(16)(18)(24)

 

First lien senior secured revolving loan

 

L + 5.75%

 

 

12/9/2025

 

 

-

 

 

 

(362

)

 

 

(67

)

 

 

 

%

Lytx, Inc.(4)(5)(24)

 

First lien senior secured loan

 

L + 6.00%

 

 

2/28/2026

 

 

53,478

 

 

 

52,704

 

 

 

52,810

 

 

 

0.9

 

%

Lytx, Inc.(4)(6)(16)(19)(24)

 

First lien senior secured delayed draw term loan

 

L + 6.00%

 

 

2/28/2023

 

 

4,650

 

 

 

4,542

 

 

 

4,416

 

 

 

0.1

 

%

Motus, LLC and Runzheimer International LLC(4)(6)(13)(24)

 

First lien senior secured loan

 

L + 6.36%

 

 

1/17/2024

 

 

59,129

 

 

 

58,342

 

 

 

59,129

 

 

 

1.0

 

%

 

 

 

 

 

 

 

 

 

 

 

262,421

 

 

 

258,335

 

 

 

261,088

 

 

 

4.5

 

%

Total non-controlled/non-affiliated portfolio company debt investments

 

 

 

 

 

 

 

 

 

$

10,929,769

 

 

$

10,752,946

 

 

$

10,688,441

 

 

 

184.3

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aerospace and defense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Space Exploration Technologies Corp.(24)(25)(31)

 

Class A Common Stock

 

N/A

 

 

N/A

 

 

823

 

 

 

346

 

 

 

346

 

 

 

 

%

Space Exploration Technologies Corp.(24)(25)(31)

 

Class C Common Stock

 

N/A

 

 

N/A

 

 

561

 

 

 

236

 

 

 

236

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

582

 

 

 

582

 

 

 

 

%

Business services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hercules Buyer, LLC (dba The Vincit Group)(24)(25)(30)(31)

 

Common Units

 

N/A

 

 

N/A

 

 

2,190,000

 

 

 

2,192

 

 

 

2,192

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,192

 

 

 

2,192

 

 

 

 

%

Financial services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Blend Labs, Inc.(24)(25)(31)

 

Preferred Stock

 

N/A

 

 

N/A

 

 

216,953

 

 

 

1,000

 

 

 

1,000

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1,000

 

 

 

1,000

 

 

 

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CM7 Restaurant Holdings, LLC(24)(25)(31)

 

LLC Interest

 

N/A

 

 

N/A

 

 

340

 

 

 

340

 

 

 

607

 

 

 

 

%

H-Food Holdings, LLC(24)(25)(31)

 

LLC Interest

 

N/A

 

 

N/A

 

 

10,875

 

 

 

10,875

 

 

 

11,159

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11,215

 

 

 

11,766

 

 

 

0.2

 

%

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

KPCI Holdings, LP(24)(25)(31)

 

LP Interest

 

N/A

 

 

N/A

 

 

25,285

 

 

 

25,285

 

 

 

25,285

 

 

 

0.4

 

%

Patriot Holdings SCSp (dba Corza Health, Inc.)(24)(25)

 

Class A Units

 

8.0% PIK

 

 

N/A

 

 

96,205

 

 

 

7,081

 

 

 

7,081

 

 

 

0.1

 

%

15


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Patriot Holdings SCSp (dba Corza Health, Inc.)(24)(25)(31)

 

Class B Units

 

N/A

 

 

N/A

 

 

6,986

 

 

 

-

 

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

32,366

 

 

 

32,366

 

 

 

0.5

 

%

Healthcare providers and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Restore OMH Intermediate Holdings, Inc.(24)(25)

 

Senior Preferred Stock

 

13.0% PIK

 

 

N/A

 

 

2,284

 

 

 

23,108

 

 

 

23,054

 

 

 

0.4

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

23,108

 

 

 

23,054

 

 

 

0.4

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Norvax, LLC (dba GoHealth)(24)(25)(31)(32)

 

Common Stock

 

N/A

 

 

N/A

 

 

1,439,481

 

 

 

7,315

 

 

 

16,828

 

 

 

0.3

 

%

PCF Holdco, LLC(16)(24)(25)(31)

 

Class A Units

 

N/A

 

 

9/30/2021

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

7,315

 

 

 

16,828

 

 

 

0.3

 

%

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gloves Holdings, LP (dba Protective Industrial Products)(24)(25)(31)

 

LP Interest

 

N/A

 

 

N/A

 

 

3,250

 

 

 

3,250

 

 

 

3,250

 

 

 

0.1

 

%

Windows Entities(24)(25)(28)

 

LLC Units

 

N/A

 

 

N/A

 

 

31,822

 

 

 

58,495

 

 

 

82,572

 

 

 

1.4

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

61,745

 

 

 

85,822

 

 

 

1.5

 

%

Total non-controlled/non-affiliated portfolio company equity investments

 

 

 

 

 

 

 

 

 

 

 

 

 

$

139,523

 

 

$

173,610

 

 

 

2.9

 

%

Total non-controlled/non-affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

 

 

$

10,892,469

 

 

$

10,862,051

 

 

 

187.2

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Controlled/affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising and media

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Swipe Acquisition Corporation (dba PLI)(4)(6)(21)(24)

 

First lien senior secured loan

 

L + 8.00%

 

 

6/29/2024

 

 

50,045

 

 

 

49,111

 

 

 

49,294

 

 

 

0.8

 

%

Swipe Acquisition Corporation (dba PLI)(4)(6)(16)(19)(21)(24)

 

First lien senior secured delayed draw term loan

 

L + 8.00%

 

 

12/31/2021

 

 

5,783

 

 

 

5,783

 

 

 

5,466

 

 

 

0.1

 

%

Swipe Acquisition Corporation (dba PLI)(4)(16)(21)(24)

 

Letter of credit

 

L + 8.00%

 

 

6/29/2024

 

 

-

 

 

 

3

 

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

55,828

 

 

 

54,897

 

 

 

54,760

 

 

 

0.9

 

%

Total controlled/affiliated portfolio company debt investments

 

 

 

 

 

 

 

 

 

$

55,828

 

 

$

54,897

 

 

$

54,760

 

 

 

0.9

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising and media

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New PLI Holdings, LLC(21)(24)(25)(31)

 

Class A Common Units

 

N/A

 

 

N/A

 

 

86,745

 

 

 

48,007

 

 

 

48,007

 

 

 

0.8

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

48,007

 

 

 

48,007

 

 

 

0.8

 

%

Financial services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wingspire Capital Holdings LLC(16)(21)(23)(25)(31)

 

LLC Interest

 

N/A

 

 

N/A

 

 

167,538

 

 

 

167,538

 

 

 

167,538

 

 

 

2.9

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

167,538

 

 

 

167,538

 

 

 

2.9

 

%

Investment funds and vehicles

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sebago Lake LLC(14)(20)(21)(23)(25)

 

LLC Interest

 

N/A

 

 

N/A

 

 

109,838

 

 

 

109,838

 

 

 

108,116

 

 

 

1.9

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

109,838

 

 

 

108,116

 

 

 

1.9

 

%

Total controlled/affiliated portfolio company equity investments

 

 

 

 

 

 

 

 

 

 

 

 

 

$

325,383

 

 

$

323,661

 

 

 

5.6

 

%

Total controlled/affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

 

 

$

380,280

 

 

$

378,421

 

 

 

6.5

 

%

Total Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

$

11,272,749

 

 

$

11,240,472

 

 

 

193.7

 

%

 

16


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

 

 

 

 

Interest Rate Swaps as of March 31, 2021

 

 

Company Receives

 

 

Company Pays

 

Maturity Date

 

Notional Amount

 

 

Hedged Instrument

 

Footnote Reference

Interest rate swap

 

4.75%

 

 

L + 2.545%

 

12/21/2021

 

$

150,000

 

 

2023 Notes

 

Note 6

Interest rate swap

 

5.25%

 

 

L + 2.937%

 

4/10/2024

 

 

400,000

 

 

2024 Notes

 

Note 6

Total

 

 

 

 

 

 

 

 

 

$

550,000

 

 

 

 

 

________________

 

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

 

(2)

Unless otherwise indicated, all investments are considered Level 3 investments.

 

(3)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

 

(4)

Loan contains a variable rate structure and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”, which can include one-, two-, three- or six-month LIBOR), Euro Interbank Offered Rate (“EURIBOR” or “E”, which can include one-, two-, three- or six-month EURIBOR), British pound sterling LIBOR (“GBPLIBOR” or “G”), or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option, and which reset periodically based on the terms of the loan agreement.

 

(5)

The interest rate on these loans is subject to 1 month LIBOR, which as of March 31, 2021 was 0.11%.

 

(6)

The interest rate on these loans is subject to 3 month LIBOR, which as of March 31, 2021 was 0.19%.

 

(7)

The interest rate on these loans is subject to 6 month LIBOR, which as of March 31, 2021 was 0.21%.

 

(8)

The interest rate on this loan is subject to 6 month Canadian Dollar Offered Rate (“CDOR” or “C”), which as of March 31, 2021 was 0.55%.

 

(9)

The interest rate on these loans is subject to Prime, which as of March 31, 2021 was 3.25%.

 

(10)

The interest rate on this loan is subject to 3 month EURIBOR, which as of March 31, 2021 was (0.54)%.

 

(11)

The interest rate on this loan is subject to 6 month EURIBOR, which as of March 31, 2021 was (0.51)%.

 

(12)

The interest rate on this loan is subject to 6 month GBPLIBOR, which as of March 31, 2021 was 0.11%.

 

(13)

The Company may be entitled to receive additional interest as a result of an arrangement with other lenders in the syndication. In exchange for the higher interest rate, the “last-out” portion is at a greater risk of loss.

 

(14)

Investment measured at net asset value (“NAV”).

 

(15)

The first lien term loan is comprised of two components: Term Loan A and Term Loan B. The Company’s Term Loan A and Term Loan B principal amounts are $41.4 million and $172.4 million, respectively. Both Term Loan A and Term Loan B have the same maturity date. Interest disclosed reflects the blended rate of the first lien term loan. The Term Loan A represents a ‘first out’ tranche and the Term Loan B represents a ‘last out’ tranche. The ‘first out’ tranche has priority as to the ‘last out’ tranche with respect to payments of principal, interest and any amounts due thereunder.

 

(16)

Position or portion thereof is an unfunded loan or equity commitment. See Note 7 “Commitments and Contingencies”.

 

(17)

Unless otherwise indicated, the Company’s portfolio companies are pledged as collateral supporting the amounts outstanding under the Revolving Credit Facility, SPV Asset Facilities and CLOs. See Note 6 “Debt”.

 

(18)

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.

 

(19)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

 

(20)

This portfolio company is not a qualifying asset under Section 55(a) of the Investment Company Act of 1940, as amended (the “1940 Act”). Under the 1940 Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of total assets. As of March 31, 2021, non-qualifying assets represented 7.3% of total assets as calculated in accordance with the regulatory requirements.

17


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

 

(21)

As defined in the 1940 Act, the Company is deemed to be both an “Affiliated Person” and has “Control” of this portfolio company as the Company owns more than 25% of the portfolio company’s outstanding voting securities or has the power to exercise control over management or policies of such portfolio company (including through a management agreement). The Company’s investment in affiliates for the year ended March 31, 2021, were as follows:

($ in thousands)

 

Fair value

as of December 31, 2020

 

 

Gross Additions(a)

 

 

Gross Reductions(b)

 

 

Change in Unrealized Gains (Losses)

 

 

Fair value

as of March 31, 2021

 

 

Interest Income

 

 

Dividend Income

 

 

Other Income

 

Controlled Affiliates

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sebago Lake LLC

 

$

105,546

 

 

$

2,000

 

 

$

 

 

$

570

 

 

$

108,116

 

 

$

 

 

$

2,368

 

 

$

 

Swipe Acquisition Corporation (dba PLI)

 

 

99,297

 

 

 

3,175

 

 

 

 

 

 

295

 

 

 

102,767

 

 

 

1,303

 

 

 

 

 

 

157

 

Wingspire Capital Holdings LLC

 

 

67,538

 

 

 

100,000

 

 

 

 

 

 

 

 

 

167,538

 

 

 

 

 

 

 

 

 

 

Total Controlled Affiliates

 

$

272,381

 

 

$

105,175

 

 

$

 

 

$

865

 

 

$

378,421

 

 

$

1,303

 

 

$

2,368

 

 

$

157

 

 

(a)

Gross additions may include increases in the cost basis of investments resulting from new investments, amounts related to payment-in-kind (“PIK”) interest capitalized and added to the principal balance of the respective loans, the accretion of discounts, the exchange of one or more existing investments for one or more new investments and the movement at fair value of an existing portfolio company into this controlled affiliated category from a different category.

 

(b)

Gross reductions may include decreases in the cost basis of investments resulting from principal collections related to investment repayments and sales, return of capital, the amortization of premiums and the exchange of one or more existing securities for one or more new securities.

 

 

(22)

Level 2 investment.

 

(23)

Investment is not pledged as collateral for the credit facilities.

 

(24)

Represents co-investment 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 “Agreements and Related Party Transactions.”

 

(25)

Securities acquired in transactions exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”) and may be deemed to be “restricted securities” under the Securities Act. As of March 31, 2021, the aggregate fair value of these securities is $497.3 million or 8.6% of the Company’s net assets. The acquisition dates of the restricted securities are as follows:

18


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of March 31, 2021

(Amounts in thousands, except share amounts)

(Unaudited)

 

 

Portfolio Company

 

Investment

 

Acquisition Date

Blend Labs, Inc.

 

Preferred Stock

 

February 24, 2021

CM7 Restaurant Holdings, LLC

 

LLC Interest

 

May 21, 2018

Gloves Holdings, LP (dba Protective Industrial Products)

 

LP Interest

 

December 29, 2020

H-Food Holdings, LLC

 

LLC Interest

 

November 23, 2018

Hercules Buyer, LLC (dba The Vincit Group)

 

Common Units

 

December 15, 2020

KPCI Holdings, LP

 

LP Interest

 

November 30, 2020

New PLI Holdings, LLC

 

Class A Common Units

 

December 23, 2020

Norvax, LLC (dba GoHealth)

 

Common Stock

 

March 23, 2020

Patriot Holdings SCSp (dba Corza Health, Inc.)

 

Class A Units

 

January 29, 2021

Patriot Holdings SCSp (dba Corza Health, Inc.)

 

Class B Units

 

January 29, 2021

PCF Holdco, LLC

 

Class A Units

 

March 30, 2021

Restore OMH Intermediate Holdings, Inc.

 

Senior Preferred Stock

 

December 9, 2020

Sebago Lake LLC*

 

LLC Interest

 

June 20, 2017

Space Exploration Technologies Corp.

 

Class A Common Stock

 

March 25, 2021

Space Exploration Technologies Corp.

 

Class C Common Stock

 

March 25, 2021

Windows Entities

 

LLC Units

 

January 16, 2020

Wingspire Capital Holdings LLC**

 

LLC Interest

 

September 24, 2019

* Refer to Note 4 “Investments – Sebago Lake LLC,” for further information.  

** Refer to Note 3 “Agreements and Related Party Transactions – Controlled/Affiliated Portfolio Companies”.

 

 

(26)

Loan contains a fixed-rate structure.

 

(27)

As of March 31, 2021, the net estimated unrealized loss for U.S. federal income tax purposes was $0.1 billion based on a tax cost basis of $11.4 billion. As of March 31, 2021, the estimated aggregate gross unrealized loss for U.S. federal income tax purposes was $0.2 billion and the estimated aggregate gross unrealized gain for U.S. federal income tax purposes was $0.1 billion.

 

(28)

Investment represents multiple underlying investments, including Midwest Custom Windows, LLC, Greater Toronto Custom Windows, Corp., Garden State Custom Windows, LLC, Long Island Custom Windows, LLC, Jemico, LLC and Atlanta Custom Windows, LLC. Greater Toronto Custom Windows, Corp. is considered a non-qualifying asset, with a fair value of $6.3 million as of March 31, 2021.

 

(29)

Loan was on non-accrual status as of March 31, 2021.

 

(30)

We invest in this portfolio company through underlying blocker entities Hercules Blocker 1 LLC, Hercules Blocker 2 LLC, Hercules Blocker 3 LLC, Hercules Blocker 4 LLC, and Hercules Blocker 5 LLC.

 

(31)

Investment is non-income producing.

 

(32)

Level 1 investment.

 

The accompanying notes are an integral part of these consolidated financial statements.

 

19


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Non-controlled/non-affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising and media

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

IRI Holdings, Inc.(4)(5)(26)

 

First lien senior secured loan

 

L + 4.25%

 

12/1/2025

 

$

7,130

 

 

$

7,076

 

 

$

7,058

 

 

 

0.1

 

%

 

 

 

 

 

 

 

 

 

7,130

 

 

 

7,076

 

 

 

7,058

 

 

 

0.1

 

%

Aerospace and defense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aviation Solutions Midco, LLC (dba STS Aviation)(4)(7)(26)

 

First lien senior secured loan

 

L + 9.25% (incl. 9.25% PIK)

 

1/3/2025

 

 

210,719

 

 

 

207,743

 

 

 

183,326

 

 

 

3.2

 

%

Valence Surface Technologies LLC(4)(8)(26)

 

First lien senior secured loan

 

L + 5.75%

 

6/28/2025

 

 

98,500

 

 

 

97,340

 

 

 

90,129

 

 

 

1.6

 

%

Valence Surface Technologies LLC(4)(7)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 5.75%

 

6/28/2021

 

 

23,820

 

 

 

23,515

 

 

 

21,285

 

 

 

0.4

 

%

Valence Surface Technologies LLC(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

6/28/2025

 

 

 

 

 

(112

)

 

 

(850

)

 

 

 

%

 

 

 

 

 

 

 

 

 

333,039

 

 

 

328,486

 

 

 

293,890

 

 

 

5.2

 

%

Automotive

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Mavis Tire Express Services Corp.(4)(7)(24)(26)

 

First lien senior secured loan

 

L + 3.25%

 

3/20/2025

 

 

864

 

 

 

813

 

 

 

847

 

 

 

 

%

Mavis Tire Express Services Corp.(4)(7)(26)

 

Second lien senior secured loan

 

L + 7.57%

 

3/20/2026

 

 

179,905

 

 

 

177,149

 

 

 

176,776

 

 

 

3.1

 

%

Mavis Tire Express Services Corp.(4)(19)(20)(21)(26)

 

Second lien senior secured delayed draw term loan

 

L + 8.00%

 

3/20/2021

 

 

 

 

 

-

 

 

 

(48

)

 

 

 

%

 

 

 

 

 

 

 

 

 

180,769

 

 

 

177,962

 

 

 

177,575

 

 

 

3.1

 

%

Buildings and real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Associations, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 7.00% (incl. 3.00% PIK)

 

7/30/2024

 

 

307,333

 

 

 

304,807

 

 

 

305,795

 

 

 

5.3

 

%

Associations, Inc.(4)(7)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 7.00% (incl. 3.00% PIK)

 

7/30/2021

 

 

59,153

 

 

 

58,724

 

 

 

58,849

 

 

 

1.0

 

%

Associations, Inc.(4)(7)(26)

 

First lien senior secured revolving loan

 

L + 6.00%

 

7/30/2024

 

 

11,543

 

 

 

11,457

 

 

 

11,427

 

 

 

0.2

 

%

Reef Global, Inc. (fka Cheese Acquisition, LLC)(4)(8)(26)

 

First lien senior secured loan

 

L + 5.75%  (incl. 1.00% PIK)

 

11/28/2024

 

 

134,253

 

 

 

132,953

 

 

 

128,212

 

 

 

2.2

 

%

Imperial Parking Canada(4)(10)(26)

 

First lien senior secured loan

 

C + 6.25%  (incl. 1.25% PIK)

 

11/28/2024

 

 

27,749

 

 

 

26,561

 

 

 

26,501

 

 

 

0.5

 

%

Reef Global, Inc. (fka Cheese Acquisition, LLC)(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 4.75%

 

11/28/2023

 

 

10,987

 

 

 

10,893

 

 

 

10,251

 

 

 

0.2

 

%

Velocity Commercial Capital, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 7.50%

 

8/29/2024

 

 

63,980

 

 

 

63,369

 

 

 

63,181

 

 

 

1.1

 

%

 

 

 

 

 

 

 

 

 

614,998

 

 

 

608,764

 

 

 

604,216

 

 

 

10.5

 

%

Business services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Access CIG, LLC(4)(5)(26)

 

Second lien senior secured loan

 

L + 7.75%

 

2/27/2026

 

 

58,760

 

 

 

58,260

 

 

 

57,732

 

 

 

1.0

 

%

CIBT Global, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 3.75%

 

6/3/2024

 

 

843

 

 

 

660

 

 

 

599

 

 

 

 

%

CIBT Global, Inc.(4)(7)(26)(31)

 

Second lien senior secured loan

 

L + 7.75% (incl. 6.75% PIK)

 

6/2/2025

 

 

62,621

 

 

 

57,364

 

 

 

32,563

 

 

 

0.6

 

%

20


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

ConnectWise, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 5.25%

 

2/28/2025

 

 

178,653

 

 

 

176,981

 

 

 

178,653

 

 

 

3.1

 

%

ConnectWise, LLC(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 5.25%

 

2/28/2025

 

 

5,001

 

 

 

4,824

 

 

 

5,001

 

 

 

0.1

 

%

Entertainment Benefits Group, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 8.25% (incl. 2.50% PIK)

 

9/30/2025

 

 

81,250

 

 

 

80,262

 

 

 

71,500

 

 

 

1.2

 

%

Entertainment Benefits Group, LLC(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 8.25% (incl. 2.50% PIK)

 

9/30/2024

 

 

10,096

 

 

 

9,971

 

 

 

8,752

 

 

 

0.2

 

%

Hercules Borrower, LLC (dba The Vincit Group)(4)(8)(26)

 

First lien senior secured loan

 

L + 6.50%

 

12/15/2026

 

 

180,043

 

 

 

177,358

 

 

 

177,343

 

 

 

3.1

 

%

Hercules Borrower, LLC (dba The Vincit Group)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 6.50%

 

12/15/2026

 

 

 

 

 

(311

)

 

 

(314

)

 

 

 

%

Hercules Buyer, LLC (dba The Vincit Group)(26)(29)(32)

 

Unsecured notes

 

0.48% (inc. 0.48% PIK)

 

12/14/2029

 

 

5,112

 

 

 

5,112

 

 

 

5,112

 

 

 

0.1

 

%

Vestcom Parent Holdings, Inc.(4)(5)

 

Second lien senior secured loan

 

L + 8.00%

 

12/19/2024

 

 

78,987

 

 

 

78,321

 

 

 

78,987

 

 

 

1.4

 

%

 

 

 

 

 

 

 

 

 

661,366

 

 

 

648,802

 

 

 

615,928

 

 

 

10.8

 

%

Chemicals

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aruba Investments Holdings LLC (dba Angus Chemical Company)(4)(8)(26)

 

Second lien senior secured loan

 

L + 7.75%

 

11/24/2028

 

 

10,000

 

 

 

9,854

 

 

 

9,850

 

 

 

0.2

 

%

Douglas Products and Packaging Company LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 5.75%

 

10/19/2022

 

 

97,939

 

 

 

97,530

 

 

 

95,980

 

 

 

1.7

 

%

Douglas Products and Packaging Company LLC(4)(11)(19)(26)

 

First lien senior secured revolving loan

 

P + 4.75%

 

10/19/2022

 

 

3,028

 

 

 

3,000

 

 

 

2,846

 

 

 

 

%

Innovative Water Care Global Corporation(4)(7)(26)

 

First lien senior secured loan

 

L + 5.00%

 

2/27/2026

 

 

147,375

 

 

 

139,223

 

 

 

129,690

 

 

 

2.3

 

%

 

 

 

 

 

 

 

 

 

258,342

 

 

 

249,607

 

 

 

238,366

 

 

 

4.2

 

%

Consumer products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Feradyne Outdoors, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 6.25%

 

5/25/2023

 

 

88,400

 

 

 

87,920

 

 

 

86,632

 

 

 

1.5

 

%

WU Holdco, Inc. (dba Weiman Products, LLC)(4)(7)(26)

 

First lien senior secured loan

 

L + 5.25%

 

3/26/2026

 

 

158,495

 

 

 

155,981

 

 

 

157,702

 

 

 

2.7

 

%

WU Holdco, Inc. (dba Weiman Products, LLC)(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 5.25%

 

3/26/2025

 

 

3,182

 

 

 

2,986

 

 

 

3,112

 

 

 

0.1

 

%

 

 

 

 

 

 

 

 

 

250,077

 

 

 

246,887

 

 

 

247,446

 

 

 

4.3

 

%

Containers and packaging

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Pregis Topco LLC(4)(5)(24)(26)

 

First lien senior secured loan

 

L + 3.75%

 

7/31/2026

 

 

863

 

 

 

819

 

 

 

859

 

 

 

-

 

%

Pregis Topco LLC(4)(5)(26)

 

Second lien senior secured loan

 

L + 7.75%

 

7/30/2027

 

 

215,033

 

 

 

211,223

 

 

 

213,959

 

 

 

3.6

 

%

 

 

 

 

 

 

 

 

 

215,896

 

 

 

212,042

 

 

 

214,818

 

 

 

3.6

 

%

Distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ABB/Con-cise Optical Group LLC(4)(8)

 

First lien senior secured loan

 

L + 5.00%

 

6/15/2023

 

 

75,620

 

 

 

75,053

 

 

 

68,815

 

 

 

1.2

 

%

ABB/Con-cise Optical Group LLC(4)(8)

 

Second lien senior secured loan

 

L + 9.00%

 

6/17/2024

 

 

25,000

 

 

 

24,604

 

 

 

21,875

 

 

 

0.4

 

%

Aramsco, Inc.(4)(5)(26)

 

First lien senior secured loan

 

L + 5.25%

 

8/28/2024

 

 

56,477

 

 

 

55,561

 

 

 

55,912

 

 

 

1.0

 

%

21


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Aramsco, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.25%

 

8/28/2024

 

 

-

 

 

 

(128

)

 

 

(84

)

 

 

 

%

Endries Acquisition, Inc.(4)(9)(26)

 

First lien senior secured loan

 

L + 6.25%

 

12/10/2025

 

 

202,219

 

 

 

199,557

 

 

 

198,680

 

 

 

3.5

 

%

Endries Acquisition, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 6.25%

 

12/10/2024

 

 

 

 

 

(310

)

 

 

(473

)

 

 

 

%

Individual Foodservice Holdings, LLC(4)(8)(26)

 

First lien senior secured loan

 

L + 6.25%

 

11/22/2025

 

 

156,900

 

 

 

154,129

 

 

 

154,547

 

 

 

2.7

 

%

Individual Foodservice Holdings, LLC(4)(8)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 6.25%

 

6/30/2022

 

 

12,587

 

 

 

11,912

 

 

 

12,012

 

 

 

0.2

 

%

Individual Foodservice Holdings, LLC(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.25%

 

11/22/2024

 

 

5,276

 

 

 

4,877

 

 

 

4,919

 

 

 

0.1

 

%

Storm Chaser Intermediate II Holding Corporation (dba JM Swank, LLC)(4)(7)

 

First lien senior secured loan

 

L + 7.50%

 

7/25/2022

 

 

114,964

 

 

 

114,167

 

 

 

114,676

 

 

 

2.0

 

%

Offen, Inc.(4)(5)(26)

 

First lien senior secured loan

 

L + 5.00%

 

6/22/2026

 

 

19,780

 

 

 

19,620

 

 

 

19,285

 

 

 

0.3

 

%

QC Supply, LLC(4)(5)

 

First lien senior secured loan

 

L + 7.00% (incl. 1.00% PIK)

 

12/29/2022

 

 

34,568

 

 

 

34,248

 

 

 

29,037

 

 

 

0.5

 

%

QC Supply, LLC(4)(5)(19)

 

First lien senior secured revolving loan

 

L + 7.00%

 

12/29/2021

 

 

4,336

 

 

 

4,311

 

 

 

3,541

 

 

 

0.1

 

%

 

 

 

 

 

 

 

 

 

707,727

 

 

 

697,601

 

 

 

682,742

 

 

 

12.0

 

%

Education

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Instructure, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 7.00%

 

3/24/2026

 

 

84,660

 

 

 

83,400

 

 

 

84,660

 

 

 

1.5

 

%

Instructure, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

3/24/2026

 

 

-

 

 

 

(60

)

 

 

-

 

 

 

-

 

%

Learning Care Group (US) No. 2 Inc.(4)(8)(26)

 

Second lien senior secured loan

 

L + 7.50%

 

3/13/2026

 

 

26,967

 

 

 

26,606

 

 

 

23,731

 

 

 

0.4

 

%

Severin Acquisition, LLC (dba PowerSchool)(4)(5)(26)

 

Second lien senior secured loan

 

L + 6.75%

 

8/3/2026

 

 

112,000

 

 

 

111,259

 

 

 

109,480

 

 

 

1.9

 

%

TSB Purchaser, Inc. (dba Teaching Strategies, Inc.)(4)(7)(26)

 

First lien senior secured loan

 

L + 6.00%

 

5/14/2024

 

 

61,581

 

 

 

60,634

 

 

 

61,120

 

 

 

1.0

 

%

TSB Purchaser, Inc. (dba Teaching Strategies, Inc.)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 6.00%

 

5/14/2024

 

 

 

 

 

(59

)

 

 

(32

)

 

 

 

%

 

 

 

 

 

 

 

 

 

285,208

 

 

 

281,780

 

 

 

278,959

 

 

 

4.8

 

%

Energy equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liberty Oilfield Services LLC(4)(5)(22)(26)

 

First lien senior secured loan

 

L + 7.63%

 

9/19/2022

 

 

13,759

 

 

 

13,661

 

 

 

13,587

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

13,759

 

 

 

13,661

 

 

 

13,587

 

 

 

0.2

 

%

Financial services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AxiomSL Group, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 6.50%

 

12/3/2027

 

 

78,659

 

 

 

77,490

 

 

 

77,479

 

 

 

1.3

 

%

AxiomSL Group, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 6.50%

 

12/3/2025

 

 

-

 

 

 

(138

)

 

 

(140

)

 

 

 

%

Blackhawk Network Holdings, Inc.(4)(5)(26)

 

Second lien senior secured loan

 

L + 7.00%

 

6/15/2026

 

 

106,400

 

 

 

105,644

 

 

 

99,750

 

 

 

1.7

 

%

Hg Genesis 8 Sumoco Limited(4)(14)(22)(26)

 

Unsecured facility

 

G + 7.50% (incl. 7.50% PIK)

 

8/28/2025

 

 

43,841

 

 

 

42,148

 

 

 

44,499

 

 

 

0.8

 

%

NMI Acquisitionco, Inc. (dba Network Merchants)(4)(5)(26)

 

First lien senior secured loan

 

L + 5.00%

 

9/6/2022

 

 

27,904

 

 

 

27,640

 

 

 

27,625

 

 

 

0.5

 

%

22


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

NMI Acquisitionco, Inc. (dba Network Merchants)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.00%

 

9/6/2022

 

 

-

 

 

 

(6

)

 

 

(6

)

 

 

 

%

 

 

 

 

 

 

 

 

 

256,804

 

 

 

252,778

 

 

 

249,207

 

 

 

4.3

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Caiman Merger Sub LLC (dba City Brewing)(4)(5)(26)

 

First lien senior secured loan

 

L + 5.75%

 

11/3/2025

 

 

175,347

 

 

 

173,881

 

 

 

176,224

 

 

 

3.1

 

%

Caiman Merger Sub LLC (dba City Brewing)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

11/1/2024

 

 

 

 

 

(99

)

 

 

-

 

 

 

 

%

CM7 Restaurant Holdings, LLC(4)(5)(26)

 

First lien senior secured loan

 

L + 8.00%

 

5/22/2023

 

 

38,507

 

 

 

37,937

 

 

 

37,352

 

 

 

0.7

 

%

H-Food Holdings, LLC(4)(5)(24)(26)

 

First lien senior secured loan

 

L + 4.00%

 

5/23/2025

 

 

12,861

 

 

 

12,768

 

 

 

12,656

 

 

 

0.2

 

%

H-Food Holdings, LLC(4)(5)(26)

 

Second lien senior secured loan

 

L + 7.00%

 

3/2/2026

 

 

121,800

 

 

 

119,542

 

 

 

119,060

 

 

 

2.1

 

%

Hometown Food Company(4)(5)(26)

 

First lien senior secured loan

 

L + 5.00%

 

8/31/2023

 

 

21,388

 

 

 

21,145

 

 

 

21,388

 

 

 

0.4

 

%

Hometown Food Company(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 5.00%

 

8/31/2023

 

 

565

 

 

 

520

 

 

 

565

 

 

 

 

%

Manna Development Group, LLC(4)(5)(26)

 

First lien senior secured loan

 

L + 6.75%

 

10/24/2022

 

 

52,764

 

 

 

52,426

 

 

 

49,598

 

 

 

0.9

 

%

Manna Development Group, LLC(4)(5)(26)

 

First lien senior secured revolving loan

 

L + 6.75%

 

10/24/2022

 

 

3,183

 

 

 

3,132

 

 

 

2,992

 

 

 

0.1

 

%

Nellson Nutraceutical, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 5.25%

 

12/23/2023

 

 

27,498

 

 

 

26,480

 

 

 

26,536

 

 

 

0.5

 

%

Nutraceutical International Corporation(4)(5)(26)

 

First lien senior secured loan

 

L + 7.00%

 

9/30/2026

 

 

217,255

 

 

 

214,110

 

 

 

215,083

 

 

 

3.6

 

%

Nutraceutical International Corporation(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

9/30/2025

 

 

 

 

 

(193

)

 

 

(136

)

 

 

 

%

Recipe Acquisition Corp. (dba Roland Corporation)(4)(7)

 

Second lien senior secured loan

 

L + 9.00%

 

12/1/2022

 

 

32,000

 

 

 

31,771

 

 

 

26,560

 

 

 

0.5

 

%

Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(4)(5)(26)

 

First lien senior secured loan

 

L + 4.50%

 

7/30/2025

 

 

44,313

 

 

 

43,705

 

 

 

42,430

 

 

 

0.7

 

%

Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 4.50%

 

7/30/2023

 

 

4,560

 

 

 

4,456

 

 

 

4,178

 

 

 

0.1

 

%

Shearer's Foods, LLC(4)(7)(26)

 

Second lien senior secured loan

 

L + 7.75%

 

9/22/2028

 

 

120,000

 

 

 

118,829

 

 

 

119,400

 

 

 

2.1

 

%

Tall Tree Foods, Inc.(4)(5)

 

First lien senior secured loan

 

L + 7.25%

 

8/12/2022

 

 

48,284

 

 

 

48,103

 

 

 

47,438

 

 

 

0.8

 

%

Ultimate Baked Goods Midco, LLC(4)(5)(26)

 

First lien senior secured loan

 

L + 4.00%

 

8/11/2025

 

 

26,460

 

 

 

26,043

 

 

 

26,064

 

 

 

0.5

 

%

Ultimate Baked Goods Midco, LLC(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 4.00%

 

8/9/2023

 

 

445

 

 

 

385

 

 

 

368

 

 

 

 

%

 

 

 

 

 

 

 

 

 

947,230

 

 

 

934,941

 

 

 

927,756

 

 

 

16.3

 

%

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nelipak Holding Company(4)(8)(26)

 

First lien senior secured loan

 

L + 4.25%

 

7/2/2026

 

 

47,521

 

 

 

46,742

 

 

 

46,333

 

 

 

0.8

 

%

Nelipak Holding Company(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 4.25%

 

7/2/2024

 

 

4,422

 

 

 

4,319

 

 

 

4,238

 

 

 

0.1

 

%

Nelipak Holding Company(4)(12)(19)(26)

 

First lien senior secured revolving loan

 

E + 4.50%

 

7/2/2024

 

 

492

 

 

 

147

 

 

 

290

 

 

 

 

%

Nelipak Holding Company(4)(8)(26)

 

Second lien senior secured loan

 

L + 8.25%

 

7/2/2027

 

 

67,006

 

 

 

66,135

 

 

 

65,331

 

 

 

1.1

 

%

23


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Nelipak Holding Company(4)(12)(26)

 

Second lien senior secured loan

 

E + 8.50%

 

7/2/2027

 

 

73,536

 

 

 

66,385

 

 

 

70,595

 

 

 

1.2

 

%

Packaging Coordinators Midco, Inc.(4)(8)(26)

 

Second lien senior secured loan

 

L + 8.25%

 

11/30/2028

 

 

195,044

 

 

 

191,173

 

 

 

191,143

 

 

 

3.3

 

%

 

 

 

 

 

 

 

 

 

388,021

 

 

 

374,901

 

 

 

377,930

 

 

 

6.5

 

 

Healthcare providers and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Barracuda Dental LLC (dba National Dentex)(4)(7)(26)

 

First lien senior secured loan

 

L + 7.00%

 

10/27/2025

 

 

62,048

 

 

 

60,974

 

 

 

60,937

 

 

 

1.1

 

%

Barracuda Dental LLC (dba National Dentex)(4)(19)(20)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 7.00%

 

6/30/2022

 

 

-

 

 

 

(105

)

 

 

(164

)

 

 

 

%

Barracuda Dental LLC (dba National Dentex)(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

10/27/2025

 

 

3,512

 

 

 

3,351

 

 

 

3,344

 

 

 

0.1

 

%

Confluent Health, LLC.(4)(5)(26)

 

First lien senior secured loan

 

L + 5.00%

 

6/24/2026

 

 

17,730

 

 

 

17,589

 

 

 

17,331

 

 

 

0.3

 

%

GI CCLS Acquisition LLC (fka GI Chill Acquisition LLC)(4)(7)(26)

 

Second lien senior secured loan

 

L + 7.50%

 

8/6/2026

 

 

135,400

 

 

 

134,357

 

 

 

133,708

 

 

 

2.3

 

%

KS Management Services, L.L.C.(4)(5)(26)

 

First lien senior secured loan

 

L + 4.25%

 

1/9/2026

 

 

123,750

 

 

 

122,422

 

 

 

123,751

 

 

 

2.2

 

%

Premier Imaging, LLC (dba LucidHealth)(4)(5)(26)

 

First lien senior secured loan

 

L + 5.50%

 

1/2/2025

 

 

33,320

 

 

 

32,851

 

 

 

32,737

 

 

 

0.6

 

%

Refresh Parent Holdings, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 6.50%

 

12/9/2026

 

 

89,872

 

 

 

88,536

 

 

 

88,524

 

 

 

1.4

 

%

Refresh Parent Holdings, Inc.(4)(19)(20)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 6.50%

 

6/9/2022

 

 

-

 

 

 

(73

)

 

 

(74

)

 

 

 

%

Refresh Parent Holdings, Inc.(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.50%

 

12/9/2026

 

 

3,060

 

 

 

2,900

 

 

 

2,899

 

 

 

0.1

 

%

TC Holdings, LLC (dba TrialCard)(4)(7)(26)

 

First lien senior secured loan

 

L + 4.50%

 

11/14/2023

 

 

83,324

 

 

 

82,427

 

 

 

83,324

 

 

 

1.5

 

%

TC Holdings, LLC (dba TrialCard)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 4.50%

 

11/14/2022

 

 

 

 

 

(58

)

 

 

 

 

 

 

%

 

 

 

 

 

 

 

 

 

552,016

 

 

 

545,171

 

 

 

546,317

 

 

 

9.6

 

%

Healthcare technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bracket Intermediate Holding Corp.(4)(7)(26)

 

First lien senior secured loan

 

L + 4.25%

 

9/5/2025

 

 

521

 

 

 

485

 

 

 

512

 

 

 

 

%

Bracket Intermediate Holding Corp.(4)(7)(26)

 

Second lien senior secured loan

 

L + 8.13%

 

9/7/2026

 

 

26,250

 

 

 

25,838

 

 

 

25,594

 

 

 

0.4

 

%

Definitive Healthcare Holdings, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 5.50%

 

7/16/2026

 

 

197,734

 

 

 

196,131

 

 

 

195,756

 

 

 

3.4

 

%

Definitive Healthcare Holdings, LLC(4)(7)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 5.50%

 

7/16/2021

 

 

7,807

 

 

 

7,531

 

 

 

7,728

 

 

 

0.1

 

%

Definitive Healthcare Holdings, LLC(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.50%

 

7/16/2024

 

 

 

 

 

(77

)

 

 

(109

)

 

 

 

%

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(4)(7)(22)(26)

 

First lien senior secured loan

 

L + 6.25%

 

2/20/2026

 

 

67,852

 

 

 

67,092

 

 

 

66,834

 

 

 

1.2

 

%

Intelerad Medical Systems Incorporated(fka 11849573 Canada Inc.)(4)(7)(19)(22)(26)

 

First lien senior secured revolving loan

 

L + 6.25%

 

2/20/2026

 

 

1,126

 

 

 

1,066

 

 

 

1,041

 

 

 

 

%

Interoperability Bidco, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 5.75%

 

6/25/2026

 

 

76,042

 

 

 

75,260

 

 

 

73,571

 

 

 

1.3

 

%

Interoperability Bidco, Inc.(4)(19)(20)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 5.75%

 

6/25/2021

 

 

 

 

 

(8

)

 

 

(170

)

 

 

 

%

Interoperability Bidco, Inc.(4)(7)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

6/25/2024

 

 

4,000

 

 

 

3,965

 

 

 

3,870

 

 

 

0.1

 

%

24


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Project Ruby Ultimate Parent Corp. (dba Wellsky)(4)(5)(26)

 

First lien senior secured loan

 

L + 4.25%

 

2/9/2024

 

 

2,906

 

 

 

2,863

 

 

 

2,863

 

 

 

 

%

Project Ruby Ultimate Parent Corp. (dba Wellsky)(4)(5)(26)

 

Second lien senior secured loan

 

L + 8.25%

 

2/9/2025

 

 

9,457

 

 

 

9,268

 

 

 

9,268

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

393,695

 

 

 

389,414

 

 

 

386,758

 

 

 

6.7

 

%

Household products

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hayward Industries, Inc.(4)(5)(24)(26)

 

First lien senior secured loan

 

L + 3.50%

 

8/5/2024

 

 

918

 

 

 

899

 

 

 

906

 

 

 

 

%

Hayward Industries, Inc.(4)(5)(26)

 

Second lien senior secured loan

 

L + 8.25%

 

8/4/2025

 

 

52,149

 

 

 

51,458

 

 

 

51,628

 

 

 

0.9

 

%

HGH Purchaser, Inc. (dba Horizon Services)(4)(7)(26)

 

First lien senior secured loan

 

L + 6.75%

 

11/3/2025

 

 

76,982

 

 

 

76,015

 

 

 

74,673

 

 

 

1.3

 

%

HGH Purchaser, Inc. (dba Horizon Services)(4)(7)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 6.75%

 

11/1/2021

 

 

26,993

 

 

 

26,394

 

 

 

26,090

 

 

 

0.5

 

%

HGH Purchaser, Inc. (dba Horizon Services)(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.75%

 

11/3/2025

 

 

972

 

 

 

855

 

 

 

680

 

 

 

 

%

 

 

 

 

 

 

 

 

 

158,014

 

 

 

155,621

 

 

 

153,977

 

 

 

2.7

 

%

Human resource support services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Ultimate Software Group, Inc.(4)(7)(26)

 

Second lien senior secured loan

 

L + 6.75%

 

5/3/2027

 

 

1,592

 

 

 

1,578

 

 

 

1,624

 

 

 

 

%

 

 

 

 

 

 

 

 

 

1,592

 

 

 

1,578

 

 

 

1,624

 

 

 

-

 

%

Infrastructure and environmental services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

FR Arsenal Holdings II Corp. (dba Applied-Cleveland Holdings, Inc.)(4)(7)

 

First lien senior secured loan

 

L + 7.50%

 

9/8/2022

 

 

121,900

 

 

 

120,927

 

 

 

115,805

 

 

 

2.0

 

%

LineStar Integrity Services LLC(4)(8)(26)

 

First lien senior secured loan

 

L + 7.25%

 

2/12/2024

 

 

88,851

 

 

 

87,950

 

 

 

78,189

 

 

 

1.4

 

%

 

 

 

 

 

 

 

 

 

210,751

 

 

 

208,877

 

 

 

193,994

 

 

 

3.4

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ardonagh Midco 2 PLC(22)(26)(29)

 

Unsecured notes

 

12.75% PIK

 

1/15/2027

 

 

9,300

 

 

 

9,213

 

 

 

9,951

 

 

 

0.2

 

%

Ardonagh Midco 3 PLC(4)(14)(22)(26)

 

First lien senior secured loan

 

G + 8.25% (incl. 2.81% PIK)

 

7/14/2026

 

 

95,791

 

 

 

83,893

 

 

 

95,791

 

 

 

1.7

 

%

Ardonagh Midco 3 PLC(4)(13)(22)(26)

 

First lien senior secured loan

 

E + 8.25% (incl. 2.81% PIK)

 

7/14/2026

 

 

10,924

 

 

 

9,720

 

 

 

10,924

 

 

 

0.2

 

%

Ardonagh Midco 3 PLC(4)(14)(19)(21)(22)(26)

 

First lien senior secured delayed draw term loan

 

G + 8.25% (incl. 2.81% PIK)

 

7/14/2022

 

 

3,390

 

 

 

2,730

 

 

 

3,390

 

 

 

0.1

 

%

Asurion, LLC(4)(5)(24)(26)

 

Second lien senior secured loan

 

L + 6.50%

 

8/4/2025

 

 

50,450

 

 

 

50,235

 

 

 

50,768

 

 

 

0.9

 

%

Integrity Marketing Acquisition, LLC(4)(8)(26)

 

First lien senior secured loan

 

L + 5.75%

 

8/27/2025

 

 

221,109

 

 

 

218,033

 

 

 

217,792

 

 

 

3.8

 

%

Integrity Marketing Acquisition, LLC(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

8/27/2025

 

 

 

 

 

(172

)

 

 

(222

)

 

 

 

%

KWOR Acquisition, Inc. (dba Worley Claims Services)(4)(5)(26)

 

First lien senior secured loan

 

L + 4.00%

 

6/3/2026

 

 

20,312

 

 

 

19,780

 

 

 

19,804

 

 

 

0.3

 

%

KWOR Acquisition, Inc. (dba Worley Claims Services)(4)(19)(20)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 4.00%

 

6/3/2021

 

 

 

 

 

(52

)

 

 

(52

)

 

 

 

%

25


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

KWOR Acquisition, Inc. (dba Worley Claims Services)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 4.00%

 

6/3/2024

 

 

 

 

 

(80

)

 

 

(130

)

 

 

 

%

KWOR Acquisition, Inc. (dba Worley Claims Services)(4)(5)(26)

 

Second lien senior secured loan

 

L + 7.75%

 

12/3/2026

 

 

49,600

 

 

 

48,976

 

 

 

48,732

 

 

 

0.8

 

%

Norvax, LLC (dba GoHealth)(4)(7)(26)

 

First lien senior secured loan

 

L + 6.50%

 

9/15/2025

 

 

199,357

 

 

 

195,089

 

 

 

199,856

 

 

 

3.4

 

%

Norvax, LLC (dba GoHealth)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 6.50%

 

9/13/2024

 

 

 

 

 

(136

)

 

 

 

 

 

 

%

Peter C. Foy & Associated Insurance Services, LLC(4)(8)(26)

 

First lien senior secured loan

 

L + 6.25%

 

3/31/2026

 

 

123,891

 

 

 

122,224

 

 

 

123,891

 

 

 

2.2

 

%

Peter C. Foy & Associated Insurance Services, LLC(4)(7)(19)(21)

 

First lien senior secured delayed draw term loan

 

L + 6.25%

 

9/30/2021

 

 

12,044

 

 

 

11,636

 

 

 

12,044

 

 

 

0.2

 

%

Peter C. Foy & Associated Insurance Services, LLC(4)(8)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.25%

 

3/31/2026

 

 

2,531

 

 

 

2,414

 

 

 

2,531

 

 

 

 

%

RSC Acquisition, Inc (dba Risk Strategies)(4)(7)(26)

 

First lien senior secured loan

 

L + 5.50%

 

10/30/2026

 

 

53,649

 

 

 

52,845

 

 

 

52,441

 

 

 

0.9

 

%

RSC Acquisition, Inc (dba Risk Strategies)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.50%

 

10/30/2026

 

 

 

 

 

(28

)

 

 

(38

)

 

 

 

%

THG Acquisition, LLC (dba Hilb)(4)(9)(26)

 

First lien senior secured loan

 

L + 5.89%

 

12/2/2026

 

 

81,921

 

 

 

80,061

 

 

 

80,246

 

 

 

1.4

 

%

THG Acquisition, LLC (dba Hilb)(4)(7)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 5.78%

 

12/2/2021

 

 

17,938

 

 

 

17,082

 

 

 

17,452

 

 

 

0.3

 

%

THG Acquisition, LLC (dba Hilb)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

12/2/2025

 

 

 

 

 

(189

)

 

 

(193

)

 

 

 

%

 

 

 

 

 

 

 

 

 

952,207

 

 

 

923,274

 

 

 

944,978

 

 

 

16.4

 

%

Internet software and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accela, Inc.(4)(5)

 

First lien senior secured loan

 

L + 4.92%  (incl. 1.67% PIK)

 

9/28/2023

 

 

22,090

 

 

 

21,871

 

 

 

22,090

 

 

 

0.4

 

%

Accela, Inc.(4)(19)(20)

 

First lien senior secured revolving loan

 

L + 7.00%

 

9/28/2023

 

 

 

 

 

 

 

 

 

 

 

 

%

Apptio, Inc.(4)(8)(26)

 

First lien senior secured loan

 

L + 7.25%

 

1/10/2025

 

 

50,916

 

 

 

49,975

 

 

 

50,662

 

 

 

0.9

 

%

Apptio, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 7.25%

 

1/10/2025

 

 

 

 

 

(37

)

 

 

(14

)

 

 

 

%

3ES Innovation Inc. (dba Aucerna)(4)(7)(22)(26)

 

First lien senior secured loan

 

L + 5.75%

 

5/13/2025

 

 

39,728

 

 

 

39,346

 

 

 

38,536

 

 

 

0.7

 

%

3ES Innovation Inc. (dba Aucerna)(4)(19)(20)(22)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

5/13/2025

 

 

 

 

 

(35

)

 

 

(117

)

 

 

 

%

BCPE Nucleon (DE) SPV, LP(4)(7)(26)

 

First lien senior secured loan

 

L + 7.00%

 

9/24/2026

 

 

213,500

 

 

 

210,318

 

 

 

210,297

 

 

 

3.7

 

%

BCTO BSI Buyer, Inc. (dba Buildertrend)(4)(7)(26)

 

First lien senior secured loan

 

L + 7.00%

 

12/23/2026

 

 

44,643

 

 

 

44,198

 

 

 

44,196

 

 

 

0.8

 

%

BCTO BSI Buyer, Inc. (dba Buildertrend)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

12/23/2026

 

 

 

 

 

(53

)

 

 

(54

)

 

 

 

%

Delta TopCo, Inc. (dba Infoblox, Inc.)(4)(8)(26)

 

Second lien senior secured loan

 

L + 7.25%

 

12/1/2028

 

 

15,000

 

 

 

14,927

 

 

 

14,925

 

 

 

0.3

 

%

Forescout Technologies, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 9.50%  ( incl. 9.50% PIK)

 

8/17/2026

 

 

49,834

 

 

 

49,032

 

 

 

49,211

 

 

 

0.9

 

%

26


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Forescout Technologies, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 8.50%

 

8/18/2025

 

 

 

 

 

(87

)

 

 

(67

)

 

 

 

%

Genesis Acquisition Co. (dba Procare Software)(4)(7)(26)

 

First lien senior secured loan

 

L + 4.00%

 

7/31/2024

 

 

18,315

 

 

 

18,085

 

 

 

17,629

 

 

 

0.3

 

%

Genesis Acquisition Co. (dba Procare Software)(4)(7)(26)

 

First lien senior secured revolving loan

 

L + 4.00%

 

7/31/2024

 

 

2,637

 

 

 

2,606

 

 

 

2,538

 

 

 

 

%

Granicus, Inc.(4)(8)(26)

 

First lien senior secured loan

 

L + 7.00%

 

8/21/2026

 

 

41,756

 

 

 

40,760

 

 

 

42,173

 

 

 

0.7

 

%

Granicus, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

8/21/2026

 

 

 

 

 

(62

)

 

 

 

 

 

 

%

H&F Opportunities LUX III S.À R.L (dba Checkmarx)(4)(8)(22)(26)

 

First lien senior secured loan

 

L + 7.75%

 

4/16/2026

 

 

42,250

 

 

 

41,100

 

 

 

42,144

 

 

 

0.7

 

%

H&F Opportunities LUX III S.À R.L (dba Checkmarx)(4)(19)(20)(22)(26)

 

First lien senior secured revolving loan

 

L + 7.75%

 

4/16/2026

 

 

 

 

 

(429

)

 

 

(41

)

 

 

 

%

Hyland Software, Inc.(4)(5)(26)

 

Second lien senior secured loan

 

L + 7.00%

 

7/7/2025

 

 

24,705

 

 

 

24,372

 

 

 

24,848

 

 

 

0.4

 

%

IQN Holding Corp. (dba Beeline)(4)(7)(26)

 

First lien senior secured loan

 

L + 5.50%

 

8/20/2024

 

 

189,956

 

 

 

188,084

 

 

 

188,531

 

 

 

3.3

 

%

IQN Holding Corp. (dba Beeline)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.50%

 

8/21/2023

 

 

 

 

 

(179

)

 

 

(170

)

 

 

 

%

Lightning Midco, LLC (dba Vector Solutions)(4)(8)(26)

 

First lien senior secured loan

 

L + 5.50%

 

11/21/2025

 

 

138,905

 

 

 

137,883

 

 

 

138,209

 

 

 

2.4

 

%

Lightning Midco, LLC (dba Vector Solutions)(4)(8)(19)(26)

 

First lien senior secured revolving loan

 

L + 5.50%

 

11/21/2023

 

 

4,409

 

 

 

4,332

 

 

 

4,343

 

 

 

0.1

 

%

Litera Bidco LLC(4)(5)(26)

 

First lien senior secured loan

 

L + 5.43%

 

5/29/2026

 

 

84,186

 

 

 

83,185

 

 

 

83,766

 

 

 

1.5

 

%

Litera Bidco LLC(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.25%

 

5/30/2025

 

 

 

 

 

(56

)

 

 

(29

)

 

 

 

%

MINDBODY, Inc.(4)(8)(26)

 

First lien senior secured loan

 

L + 8.50%  (incl. 1.50% PIK)

 

2/14/2025

 

 

58,187

 

 

 

57,761

 

 

 

53,532

 

 

 

0.9

 

%

MINDBODY, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

2/14/2025

 

 

 

 

 

(42

)

 

 

(486

)

 

 

 

%

SURF HOLDINGS, LLC (dba Sophos Group plc)(4)(7)(22)(26)

 

Second lien senior secured loan

 

L + 8.00%

 

3/6/2028

 

 

40,385

 

 

 

39,458

 

 

 

39,981

 

 

 

0.7

 

%

Trader Interactive, LLC (fka Dominion Web Solutions, LLC)(4)(7)(26)

 

First lien senior secured loan

 

L + 6.25%

 

6/17/2024

 

 

132,566

 

 

 

131,507

 

 

 

131,240

 

 

 

2.2

 

%

Trader Interactive, LLC (fka Dominion Web Solutions, LLC)(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.25%

 

6/15/2023

 

 

1,916

 

 

 

1,876

 

 

 

1,852

 

 

 

 

%

 

 

 

 

 

 

 

 

 

1,215,884

 

 

 

1,199,696

 

 

 

1,199,725

 

 

 

20.9

 

%

Leisure and entertainment

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Troon Golf, L.L.C.(4)(7)(18)(26)

 

First lien senior secured term loan A and B

 

L + 5.50%

(TLA: L + 3.5%; TLB: L + 5.98%)

 

3/29/2025

 

 

219,112

 

 

 

216,856

 

 

 

218,564

 

 

 

3.7

 

%

Troon Golf, L.L.C.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.50%

 

3/29/2025

 

 

 

 

 

(99

)

 

 

(36

)

 

 

 

%

 

 

 

 

 

 

 

 

 

219,112

 

 

 

216,757

 

 

 

218,528

 

 

 

3.7

 

%

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gloves Buyer, Inc. (dba Protective Industrial Products)(4)(5)(26)

 

Second lien senior secured loan

 

L + 8.25%

 

12/29/2028

 

 

29,250

 

 

 

28,519

 

 

 

28,519

 

 

 

0.5

 

%

27


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Ideal Tridon Holdings, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 5.75%

 

7/31/2024

 

 

53,310

 

 

 

52,757

 

 

 

52,111

 

 

 

0.9

 

%

Ideal Tridon Holdings, Inc.(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

7/31/2023

 

 

900

 

 

 

858

 

 

 

771

 

 

 

 

%

MHE Intermediate Holdings, LLC(dba Material Handling Services)(4)(7)(26)

 

First lien senior secured loan

 

L + 5.00%

 

3/8/2024

 

 

23,726

 

 

 

23,571

 

 

 

23,014

 

 

 

0.4

 

%

PHM Netherlands Midco B.V. (dba Loparex)(4)(7)(26)

 

First lien senior secured loan

 

L + 4.50%

 

7/31/2026

 

 

794

 

 

 

737

 

 

 

780

 

 

 

 

%

PHM Netherlands Midco B.V. (dba Loparex)(4)(7)(26)

 

Second lien senior secured loan

 

L + 8.75%

 

8/2/2027

 

 

112,000

 

 

 

105,126

 

 

 

106,960

 

 

 

1.8

 

%

Professional Plumbing Group, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 6.75%

 

4/16/2024

 

 

51,681

 

 

 

51,210

 

 

 

49,873

 

 

 

0.9

 

%

  Professional Plumbing Group, Inc.(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.75%

 

4/16/2023

 

 

6,643

 

 

 

6,582

 

 

 

6,209

 

 

 

0.1

 

%

Safety Products/JHC Acquisition Corp.(dba Justrite Safety Group)(4)(5)(26)

 

First lien senior secured loan

 

L + 4.50%

 

6/28/2026

 

 

13,345

 

 

 

13,237

 

 

 

12,110

 

 

 

0.2

 

%

Safety Products/JHC Acquisition Corp.(dba Justrite Safety Group)(4)(5)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 4.50%

 

6/28/2021

 

 

721

 

 

 

708

 

 

 

569

 

 

 

 

%

Sonny's Enterprises LLC(4)(5)(26)

 

First lien senior secured loan

 

L + 7.00%

 

8/5/2026

 

 

226,625

 

 

 

222,327

 

 

 

223,225

 

 

 

3.9

 

%

Sonny's Enterprises LLC(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

8/5/2025

 

 

 

 

 

(330

)

 

 

(270

)

 

 

 

%

 

 

 

 

 

 

 

 

 

518,995

 

 

 

505,302

 

 

 

503,871

 

 

 

8.7

 

%

Oil and gas

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Black Mountain Sand Eagle Ford LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 8.25%

 

8/17/2022

 

 

46,883

 

 

 

46,683

 

 

 

42,429

 

 

 

0.7

 

%

Project Power Buyer, LLC (dba PEC-Veriforce)(4)(7)(26)

 

First lien senior secured loan

 

L + 6.25%

 

5/14/2026

 

 

45,553

 

 

 

45,039

 

 

 

45,097

 

 

 

0.8

 

%

Project Power Buyer, LLC (dba PEC-Veriforce)(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 6.25%

 

5/14/2025

 

 

 

 

 

(29

)

 

 

(32

)

 

 

 

%

Zenith Energy U.S. Logistics Holdings, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 6.50%

 

12/20/2024

 

 

95,365

 

 

 

93,991

 

 

 

94,410

 

 

 

1.6

 

%

 

 

 

 

 

 

 

 

 

187,801

 

 

 

185,684

 

 

 

181,904

 

 

 

3.1

 

%

Professional services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AmSpec Services Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 5.75%

 

7/2/2024

 

 

111,404

 

 

 

110,080

 

 

 

108,896

 

 

 

1.9

 

%

AmSpec Services Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 4.75%

 

7/2/2024

 

 

 

 

 

(148

)

 

 

(325

)

 

 

 

%

Cardinal US Holdings, Inc.(4)(7)(22)(26)

 

First lien senior secured loan

 

L + 5.00%

 

7/31/2023

 

 

89,273

 

 

 

86,998

 

 

 

88,827

 

 

 

1.5

 

%

DMT Solutions Global Corporation(4)(7)(26)

 

First lien senior secured loan

 

L + 7.50%

 

7/2/2024

 

 

57,150

 

 

 

55,677

 

 

 

54,864

 

 

 

1.0

 

%

GC Agile Holdings Limited (dba Apex Fund Services)(4)(7)(22)(26)

 

First lien senior secured loan

 

L + 7.00%

 

6/15/2025

 

 

158,862

 

 

 

156,717

 

 

 

156,081

 

 

 

2.7

 

%

GC Agile Holdings Limited (dba Apex Fund Services)(4)(7)(19)(22)(26)

 

First lien senior secured revolving loan

 

L + 7.00%

 

6/15/2023

 

 

3,462

 

 

 

3,299

 

 

 

3,280

 

 

 

0.1

 

%

28


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Gerson Lehrman Group, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 4.75%

 

12/12/2024

 

 

195,899

 

 

 

194,541

 

 

 

195,899

 

 

 

3.4

 

%

Gerson Lehrman Group, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 4.75%

 

12/12/2024

 

 

 

 

 

(142

)

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

616,050

 

 

 

607,022

 

 

 

607,522

 

 

 

10.6

 

%

Specialty retail

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BIG Buyer, LLC(4)(8)(26)

 

First lien senior secured loan

 

L + 6.50%

 

11/20/2023

 

 

49,952

 

 

 

49,240

 

 

 

48,954

 

 

 

0.9

 

%

BIG Buyer, LLC(4)(19)(20)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 6.50%

 

2/28/2021

 

 

-

 

 

 

(72

)

 

 

(14

)

 

 

 

%

BIG Buyer, LLC(4)(5)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.50%

 

11/20/2023

 

 

1,750

 

 

 

1,681

 

 

 

1,675

 

 

 

 

%

EW Holdco, LLC (dba European Wax)(4)(5)(26)

 

First lien senior secured loan

 

L + 5.50%

 

9/25/2024

 

 

71,297

 

 

 

70,818

 

 

 

67,732

 

 

 

1.2

 

%

Galls, LLC(4)(7)(26)

 

First lien senior secured loan

 

L + 6.75%  (incl. 0.50% PIK)

 

1/31/2025

 

 

105,272

 

 

 

104,288

 

 

 

101,061

 

 

 

1.8

 

%

Galls, LLC(4)(7)(19)(26)

 

First lien senior secured revolving loan

 

L + 6.75%  (incl. 0.50% PIK)

 

1/31/2024

 

 

9,916

 

 

 

9,741

 

 

 

9,072

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

238,187

 

 

 

235,696

 

 

 

228,480

 

 

 

4.1

 

%

Telecommunications

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DB Datacenter Holdings Inc.(4)(5)(26)

 

Second lien senior secured loan

 

L + 8.00%

 

4/3/2025

 

 

47,409

 

 

 

46,920

 

 

 

47,172

 

 

 

0.8

 

%

Park Place Technologies, LLC(4)(5)(26)

 

First lien senior secured loan

 

L + 5.00%

 

11/10/2027

 

 

9,000

 

 

 

8,646

 

 

 

8,640

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

56,409

 

 

 

55,566

 

 

 

55,812

 

 

 

1.0

 

%

Transportation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lazer Spot G B Holdings, Inc.(4)(7)(26)

 

First lien senior secured loan

 

L + 5.75%

 

12/9/2025

 

 

145,530

 

 

 

143,377

 

 

 

144,439

 

 

 

2.5

 

%

Lazer Spot G B Holdings, Inc.(4)(19)(20)(26)

 

First lien senior secured revolving loan

 

L + 5.75%

 

12/9/2025

 

 

-

 

 

 

(381

)

 

 

(201

)

 

 

 

%

Lytx, Inc.(4)(5)(26)

 

First lien senior secured loan

 

L + 6.00%

 

2/28/2026

 

 

53,614

 

 

 

52,804

 

 

 

52,675

 

 

 

0.9

 

%

Lytx, Inc.(4)(5)(19)(21)(26)

 

First lien senior secured delayed draw term loan

 

L + 6.00%

 

2/28/2022

 

 

4,662

 

 

 

4,524

 

 

 

4,334

 

 

 

0.1

 

%

Motus, LLC and Runzheimer International LLC(4)(7)(15)(26)

 

First lien senior secured loan

 

L + 6.36%

 

1/17/2024

 

 

59,282

 

 

 

58,430

 

 

 

59,282

 

 

 

1.0

 

%

 

 

 

 

 

 

 

 

 

263,088

 

 

 

258,754

 

 

 

260,529

 

 

 

4.5

 

%

Total non-controlled/non-affiliated portfolio company debt investments

 

 

 

 

 

 

 

 

10,704,167

 

 

 

10,523,700

 

 

 

10,413,497

 

 

 

181.3

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hercules Buyer, LLC (dba The Vincit Group)(26)(28)(32)

 

Common Units

 

N/A

 

N/A

 

 

2,190,000

 

 

 

2,190

 

 

 

2,190

 

 

 

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

2,190

 

 

 

2,190

 

 

 

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CM7 Restaurant Holdings, LLC(26)(28)

 

LLC Interest

 

N/A

 

N/A

 

 

340

 

 

 

340

 

 

 

340

 

 

 

 

%

H-Food Holdings, LLC(26)(28)

 

LLC Interest

 

N/A

 

N/A

 

 

10,875

 

 

 

10,875

 

 

 

11,159

 

 

 

0.2

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

11,215

 

 

 

11,499

 

 

 

0.2

 

%

29


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

%

KPCI Holdings, LP(26)(28)

 

LP Interest

 

N/A

 

N/A

 

 

25,285

 

 

 

25,285

 

 

 

25,285

 

 

 

0.4

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

25,285

 

 

 

25,285

 

 

 

0.4

 

%

Healthcare providers and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

%

Restore OMH Intermediate Holdings, Inc.(26)(28)

 

Senior Preferred Stock

 

N/A

 

N/A

 

 

2,284

 

 

 

22,163

 

 

 

22,157

 

 

 

0.4

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

22,163

 

 

 

22,157

 

 

 

0.4

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

%

Norvax, LLC (dba GoHealth)(24)(26)(28)

 

Common Stock

 

N/A

 

N/A

 

 

1,439,481

 

 

 

7,315

 

 

 

19,275

 

 

 

0.3

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

7,315

 

 

 

19,275

 

 

 

0.3

 

%

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

%

Gloves Holdings, LP (dba Protective Industrial Products)(26)(28)

 

LP Interest

 

N/A

 

N/A

 

 

3,250

 

 

 

3,250

 

 

 

3,250

 

 

 

0.1

 

%

Windows Entities(22)(26)(28)(30)

 

LLC Units

 

N/A

 

N/A

 

 

31,822

 

 

 

58,495

 

 

 

72,538

 

 

 

1.3

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

61,745

 

 

 

75,788

 

 

 

1.4

 

%

Total non-controlled/non-affiliated portfolio company equity investments

 

 

 

 

 

 

 

 

 

 

 

 

129,913

 

 

 

156,194

 

 

 

2.7

 

%

Total non-controlled/non-affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

 

10,653,613

 

 

 

10,569,691

 

 

 

184.0

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Controlled/affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising and media

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

%

Swipe Acquisition Corporation (dba PLI)(4)(7)(23)(26)

 

First lien senior secured loan

 

L + 8.00%

 

6/29/2024

 

 

50,045

 

 

 

49,050

 

 

 

49,044

 

 

 

0.9

 

%

Swipe Acquisition Corporation (dba PLI)(4)(7)(19)(21)(23)(26)

 

First lien senior secured delayed draw term loan

 

L + 8.00%

 

12/31/2021

 

 

2,669

 

 

 

2,669

 

 

 

2,246

 

 

 

 

%

Swipe Acquisition Corporation (dba PLI)(4)(19)(23)(26)

 

Letter of Credit

 

L + 8.00%

 

6/29/2024

 

 

-

 

 

 

4

 

 

 

-

 

 

 

 

%

 

 

 

 

 

 

 

 

 

52,714

 

 

 

51,723

 

 

 

51,290

 

 

 

0.9

 

%

Total controlled/affiliated portfolio company debt investments

 

 

 

 

 

 

 

 

52,714

 

 

 

51,723

 

 

 

51,290

 

 

 

0.9

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advertising and media

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New PLI Holdings, LLC(23)(26)(28)

 

Class A Common Units

 

N/A

 

N/A

 

 

86,745

 

 

 

48,007

 

 

 

48,007

 

 

 

0.8

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

48,007

 

 

 

48,007

 

 

 

0.8

 

%

Financial services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Wingspire Capital Holdings LLC(19)(23)(25)(28)

 

LLC Interest

 

N/A

 

N/A

 

 

67,538

 

 

 

67,538

 

 

 

67,538

 

 

 

1.2

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

67,538

 

 

 

67,538

 

 

 

1.2

 

%

30


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

Company(1)(2)(17)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)(27)

 

 

Fair Value

 

 

Percentage of Net Assets

 

 

Investment funds and vehicles

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sebago Lake LLC(16)(22)(23)(25)(28)

 

LLC Interest

 

N/A

 

N/A

 

 

107,837

 

 

 

107,837

 

 

 

105,546

 

 

 

1.8

 

%

 

 

 

 

 

 

 

 

 

 

 

 

 

107,837

 

 

 

105,546

 

 

 

1.8

 

%

Total controlled/affiliated portfolio company equity investments

 

 

 

 

 

 

 

 

 

 

 

 

223,382

 

 

 

221,091

 

 

 

3.8

 

%

Total controlled/affiliated portfolio company investments

 

 

 

 

 

 

 

 

 

 

 

$

275,105

 

 

$

272,381

 

 

 

4.7

 

%

Total Investments

 

 

 

 

 

 

 

 

 

 

 

$

10,928,718

 

 

$

10,842,072

 

 

 

188.7

 

%

 

 

 

 

Interest Rate Swaps as of December 31, 2020

 

 

Company Receives

 

 

Company Pays

 

Maturity Date

 

Notional Amount

 

 

Hedged Instrument

 

Footnote Reference

Interest rate swap

 

4.75%

 

 

L + 2.545%

 

12/21/2021

 

$

150,000

 

 

2023 Notes

 

Note 6

Interest rate swap

 

5.25%

 

 

L + 2.937%

 

4/10/2024

 

 

400,000

 

 

2024 Notes

 

Note 6

Total

 

 

 

 

 

 

 

 

 

$

550,000

 

 

 

 

 

________________

 

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

 

(2)

Unless otherwise indicated, all investments are considered Level 3 investments.

 

(3)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

 

(4)

Loan contains a variable rate structure and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) (which can include one-, two-, three- or six-month LIBOR), Euro Interbank Offered Rate (“EURIBOR” or “E”), or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option, and which reset periodically based on the terms of the loan agreement.

 

(5)

The interest rate on these loans is subject to 1 month LIBOR, which as of December 31, 2020 was 0.14%.

 

(6)

The interest rate on these loans is subject to 2 month LIBOR, which as of December 31, 2020 was 0.19%.

 

(7)

The interest rate on these loans is subject to 3 month LIBOR, which as of December 31, 2020 was 0.24%.

 

(8)

The interest rate on these loans is subject to 6 month LIBOR, which as of December 31, 2020 was 0.26%.

 

(9)

The interest rate on these loans is subject to 12 month LIBOR, which as of December 31, 2020 was 0.34%.

 

(10)

The interest rate on this loan is subject to 6 month Canadian Dollar Offered Rate (“CDOR” or “C”), which as of December 31, 2020 was 0.62%.

 

(11)

The interest rate on these loans is subject to Prime, which as of December 31, 2020 was 3.25%.

 

(12)

The interest rate on this loan is subject to 3 month EURIBOR, which as of December 31, 2020 was (0.55)%.

 

(13)

The interest rate on this loan is subject to 6 month EURIBOR, which as of December 31, 2020 was (0.53)%.

 

(14)

The interest rate on this loan is subject to 6 month GBPLIBOR, which as of December 31, 2020 was 0.03%.

 

(15)

The Company may be entitled to receive additional interest as a result of an arrangement with other lenders in the syndication. In exchange for the higher interest rate, the “last-out” portion is at a greater risk of loss.

 

(16)

Investment measured at NAV.

 

(17)

The first lien term loan is comprised of two components: Term Loan A and Term Loan B. The Company’s Term Loan A and Term Loan B principal amounts are $42.4 million and $176.7 million, respectively. Both Term Loan A and Term Loan B have the same maturity date. Interest disclosed reflects the blended rate of the first lien term loan. The Term Loan A represents a ‘first out’ tranche and the Term Loan B represents a ‘last out’ tranche. The ‘first out’ tranche has priority as to the ‘last out’ tranche with respect to payments of principal, interest and any amounts due thereunder.

 

(18)

Position or portion thereof is an unfunded loan commitment. See Note 7 “Commitments and Contingencies”.

 

(19)

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.

 

(20)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

31


Owl Rock Capital Corporation

Consolidated Schedule of Investments

As of December 31, 2020

(Amounts in thousands, except share amounts)

 

 

(21)

Unless otherwise indicated, the Company’s portfolio companies are pledged as collateral supporting the amounts outstanding under the Revolving Credit Facility, SPV Asset Facilities and CLOs. See Note 6 “Debt”.

 

(22)

This portfolio company is not a qualifying asset under Section 55(a) of the 1940 Act. Under the 1940 Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of total assets. As of December 31, 2020, non-qualifying assets represented 6.8% of total assets as calculated in accordance with the regulatory requirements.

 

(23)

As defined in the 1940 Act, the Company is deemed to be both an “Affiliated Person” and has “Control” of this portfolio company as the Company owns more than 25% of the portfolio company’s outstanding voting securities or has the power to exercise control over management or policies of such portfolio company (including through a management agreement). The Company’s investment in affiliates for the year ended December 31, 2020, were as follows:

($ in thousands)

 

Fair value

as of December 31, 2019

 

 

Gross Additions

 

 

Gross Reductions

 

 

Change in Unrealized Gains (Losses)

 

 

Fair value

as of December 31, 2020

 

 

Interest Income

 

 

Dividend Income

 

 

Other Income

 

Controlled Affiliates

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sebago Lake LLC

 

$

88,077

 

 

$

18,950

 

 

$

 

 

$

(1,480

)

 

$

105,546

 

 

$

 

 

$

9,063

 

 

$

 

Swipe Acquisition Corporation (dba PLI)

 

 

 

 

 

99,730

 

 

 

 

 

 

(433

)

 

 

99,297

 

 

 

327

 

 

 

 

 

 

35

 

Wingspire Capital Holdings LLC

 

 

1,448

 

 

 

166,090

 

 

 

(100,000

)

 

 

 

 

 

67,538

 

 

 

 

 

 

 

 

 

 

Total Controlled Affiliates

 

$

89,525

 

 

$

284,770

 

 

$

(100,000

)

 

$

(1,913

)

 

$

272,381

 

 

$

327

 

 

$

9,063

 

 

$

35

 

 

(24)

Level 2 investment.

 

(25)

Investment is not pledged as collateral for the credit facilities.

 

(26)

Represents co-investment 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 “Agreements and Related Party Transactions.”

 

(27)

As of December 31, 2020, the net estimated unrealized loss for U.S. federal income tax purposes was $0.2 billion based on a tax cost basis of $11.0 billion. As of December 31, 2020, the estimated aggregate gross unrealized loss for U.S. federal income tax purposes was $0.3 billion and the estimated aggregate gross unrealized gain for U.S. federal income tax purposes was $0.1 billion.

 

(28)

Securities acquired in transactions exempt from registration under the Securities Act and may be deemed to be “restricted securities” under the Securities Act. As of December 31, 2020, the aggregate fair value of these securities is $377.3 million or 6.5% of the Company’s net assets. The acquisition dates of the restricted securities are as follows:

Portfolio Company

 

Investment

 

Acquisition Date

CM7 Restaurant Holdings, LLC

 

LLC Interest

 

May 21, 2018

Gloves Holdings, LP

 

LP Interest

 

December 29, 2020

Hercules Buyer, LLC

 

Common Units

 

December 15, 2020

H-Food Holdings, LLC

 

LLC Interest

 

November 23, 2018

KPCI Holdings, LP

 

LP Interest

 

November 30, 2020

New PLI Holdings, LLC

 

Class A Common Units

 

December 23, 2020

Norvax, LLC (dba GoHealth)

 

Common Stock

 

March 23, 2020

Restore OMH Intermediate Holdings, Inc.

 

Senior Preferred Stock

 

December 9, 2020

Sebago Lake LLC*

 

LLC Interest

 

June 20, 2017

Windows Entities

 

LLC Units

 

January 16 2020

Wingspire Capital Holdings LLC**

 

LLC Interest

 

September 24, 2019

* Refer to Note 4 “Investments – Sebago Lake LLC,” for further information.  

** Refer to Note 3 “Agreements and Related Party Transactions – Controlled/Affiliated Portfolio Companies”.

 

 

(29)

Loan contains a fixed-rate structure.

 

(30)

Investment represents multiple underlying investments, including Midwest Custom Windows, LLC, Greater Toronto Custom Windows, Corp., Garden State Custom Windows, LLC, Long Island Custom Windows, LLC, Jemico, LLC and Atlanta Custom Windows, LLC. Greater Toronto Custom Windows, Corp. is considered a non-qualifying asset, with a fair value of $5.5 million as of December 31, 2020.

 

(31)

Loan was on non-accrual status as of December 31, 2020.

 

(32)

We invest in this portfolio company through underlying blocker entities Hercules Blocker 1 LLC, Hercules Blocker 2 LLC, Hercules Blocker 3 LLC, Hercules Blocker 4 LLC, and Hercules Blocker 5 LLC.

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

32


 

 

Owl Rock Capital Corporation

Consolidated Statements of Changes in Net Assets

(Amounts in thousands)

(Unaudited)

 

 

 

For the Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

Increase (Decrease) in Net Assets Resulting from Operations

 

 

 

 

 

 

 

 

Net investment income (loss)

 

$

102,655

 

 

$

146,256

 

Net change in unrealized gain (loss)

 

 

52,879

 

 

 

(459,115

)

Net realized gain (loss)

 

 

2,311

 

 

 

269

 

Net Increase (Decrease) in Net Assets Resulting from Operations

 

 

157,845

 

 

 

(312,590

)

Distributions

 

 

 

 

 

 

 

 

Distributions declared from earnings(1)

 

 

(121,335

)

 

 

(152,434

)

Net Decrease in Net Assets Resulting from Shareholders' Distributions

 

 

(121,335

)

 

 

(152,434

)

Capital Share Transactions

 

 

 

 

 

 

 

 

Repurchase of common shares

 

 

 

 

 

(47,961

)

Reinvestment of distributions

 

 

19,144

 

 

 

42,964

 

Net Increase in Net Assets Resulting from Capital Share Transactions

 

 

19,144

 

 

 

(4,997

)

Total Increase (Decrease) in Net Assets

 

 

55,654

 

 

 

(470,021

)

Net Assets, at beginning of period

 

 

5,746,434

 

 

 

5,977,283

 

Net Assets, at end of period

 

$

5,802,088

 

 

$

5,507,262

 

________________

 

(1)

For the three months ended March 31, 2021 and 2020, distributions declared from earnings were derived from net investment income and capital gains.

 

The accompanying notes are an integral part of these consolidated financial statements.

33


 

Owl Rock Capital Corporation

Consolidated Statements of Cash Flows

(Amounts in thousands)

(Unaudited)

 

 

 

For the Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

Cash Flows from Operating Activities

 

 

 

 

 

 

 

 

Net Increase (Decrease) in Net Assets Resulting from Operations

 

$

157,845

 

 

$

(312,590

)

Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash used in operating activities:

 

 

 

 

 

 

 

 

Purchases of investments, net

 

 

(952,642

)

 

 

(1,046,846

)

Proceeds from investments and investment repayments, net

 

 

637,837

 

 

 

463,125

 

Net amortization of discount on investments

 

 

(12,343

)

 

 

(14,617

)

Payment-in-kind interest

 

 

(15,686

)

 

 

(3,413

)

Net change in unrealized (gain) loss on investments

 

 

(57,944

)

 

 

459,034

 

Net change in unrealized (gains) losses on translation of assets and liabilities in foreign currencies

 

 

2,149

 

 

 

81

 

Net realized (gain) loss on investments

 

 

(1,154

)

 

 

(348

)

Net realized (gain) loss on foreign currency transactions relating to investments

 

 

(43

)

 

 

6

 

Amortization of debt issuance costs

 

 

4,946

 

 

 

3,170

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

 

(Increase) decrease in receivable for investments sold

 

 

1,961

 

 

 

9,250

 

(Increase) decrease in interest receivable

 

 

1,254

 

 

 

3,765

 

(Increase) decrease in receivable from a controlled affiliate

 

 

(20

)

 

 

287

 

(Increase) decrease in prepaid expenses and other assets

 

 

8,674

 

 

 

(23,231

)

Increase (decrease) in management fee payable

 

 

6,171

 

 

 

639

 

Increase (decrease) in incentive fee payable

 

 

2,706

 

 

 

 

Increase (decrease) in payables to affiliate

 

 

(3,940

)

 

 

(2,710

)

Increase (decrease) in payables for investments purchased

 

 

 

 

 

49,116

 

Increase (decrease) in fair value of interest rate swap attributed to unsecured notes

 

 

(5,693

)

 

 

20,043

 

Increase (decrease) in accrued expenses and other liabilities

 

 

877

 

 

 

22,120

 

Net cash used in operating activities

 

 

(225,045

)

 

 

(373,119

)

Cash Flows from Financing Activities

 

 

 

 

 

 

 

 

Borrowings on debt

 

 

637,364

 

 

 

1,372,000

 

Payments on debt

 

 

(380,000

)

 

 

(777,000

)

Debt issuance costs

 

 

(2,022

)

 

 

(13,871

)

Repurchase of common stock

 

 

-

 

 

 

(47,961

)

Cash distributions paid to shareholders

 

 

(132,943

)

 

 

(94,285

)

Net cash provided by financing activities

 

 

122,399

 

 

 

438,883

 

Net increase (decrease) in cash and restricted cash, including foreign

    cash (restricted cash of $(1,142) and $(3,173), respectively)

 

 

(102,646

)

 

 

65,764

 

Cash and restricted cash, including foreign cash, beginning of period (restricted cash of

     $8,841 and $7,587, respectively)

 

 

357,911

 

 

 

317,159

 

Cash and restricted cash, including foreign cash, end of period

    (restricted cash of $7,699, $4,414, respectively)

 

$

255,265

 

 

$

382,923

 

34


 

 

Owl Rock Capital Corporation

Consolidated Statements of Cash Flows – Continued

(Amounts in thousands)

(Unaudited)

 

 

 

For the Three Months Ended March 31,

 

 

 

2021

 

 

2020

 

Supplemental and Non-Cash Information

 

 

 

 

 

 

 

 

Interest paid during the period

 

$

43,279

 

 

$

27,239

 

Distributions declared during the period

 

$

121,335

 

 

$

152,434

 

Reinvestment of distributions during the period

 

$

19,144

 

 

$

42,964

 

Distributions Payable

 

$

121,335

 

 

$

152,434

 

Receivable for investments sold

 

$

4,355

 

 

$

 

Taxes, including excise tax, paid during the period

 

$

 

 

$

1,990

 

 

The accompanying notes are an integral part of these consolidated financial statements.

 

 

 

35


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited)

 

 

Note 1. Organization

Owl Rock Capital Corporation (the “Company”) is a Maryland corporation formed on October 15, 2015. The Company was formed primarily to originate and make loans to, and make debt and equity investments in, U.S. middle market companies. The Company invests in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity and equity-related securities including warrants, preferred stock and similar forms of senior equity, which may or may not be convertible into a portfolio company’s common equity. The Company’s investment objective is to generate current income and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns.

The Company has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). In addition, for tax purposes, the Company is treated as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). Because the Company has elected to be regulated as a BDC and qualifies as a RIC under the Code, the Company’s portfolio is subject to diversification and other requirements.

On April 27, 2016, the Company formed a wholly-owned subsidiary, OR Lending LLC, a Delaware limited liability company, which holds a California finance lenders license. OR Lending LLC makes loans to borrowers headquartered in California. From time to time the Company may form wholly-owned subsidiaries to facilitate the normal course of business.

Certain of the Company’s consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

Owl Rock Capital Advisors LLC (the “Adviser”) serves as the Company’s investment adviser. The Adviser is an indirect subsidiary of Owl Rock Capital Partners LP (“Owl Rock Capital Partners”). The Adviser is registered with the Securities and Exchange Commission (“SEC”) as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). Subject to the overall supervision of the Company’s board of directors (the “Board”), the Adviser manages the day-to-day operations of, and provides investment advisory and management services to, the Company.  

On December 23, 2020, Owl Rock Capital Group, LLC (“Owl Rock Capital Group”), the parent of the Adviser (and a subsidiary of Owl Rock Capital Partners), and Dyal Capital Partners (“Dyal”) announced they are merging to form Blue Owl Capital Inc. (“Blue Owl”).  Blue Owl will enter the public market via its acquisition by Altimar Acquisition Corporation (NYSE:ATAC) (“Altimar”), a special purpose acquisition company (the “Transaction”). If the Transaction is consummated, there will be no changes to the Company’s investment strategy or the Adviser’s investment team or investment process with respect to the Company; however, the Transaction will result in a change in control of the Adviser, which will be deemed an assignment of the Investment Advisory Agreement in accordance with the 1940 Act. As a result, the Board, after considering the Transaction and subsequent change in control, determined that upon consummation of the Transaction, the Company should enter into a third amended and restated investment advisory agreement with the Adviser on terms that are identical to the Investment Advisory Agreement. At a special meeting of the Company's shareholders held on March 17, 2021, the Company's shareholders approved the Company's entry, upon consummation of the Transaction, into the third amended and restated advisory agreement with the Adviser on terms that are identical to the Advisory Agreement. The Board also determined that upon consummation of the Transaction, the Company should enter into an amended and restated administration agreement with the Adviser on terms that are identical to the Administration Agreement. See “Item 1. Business – The Adviser and Administrator – Owl Rock Capital Advisors LLC.”

On July 22, 2019, the Company closed its initial public offering (“IPO”), issuing 10 million shares of its common stock at a public offering price of $15.30 per share, and on August 2, 2019, the underwriters exercised their option to purchase an additional 1.5 million shares of common stock at a purchase price of $15.30 per share.  Net of underwriting fees and offering costs, the Company received total cash proceeds of $164.0 million. The Company’s common stock began trading on the New York Stock Exchange (“NYSE”) under the symbol “ORCC” on July 18, 2019.

 

 

36


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Note 2. Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company is an investment company and, therefore, applies the specialized accounting and reporting guidance in Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies. In the opinion of management, all adjustments considered necessary for the fair presentation of the consolidated financial statements have been included. The Company was initially capitalized on March 1, 2016 and commenced operations on March 3, 2016. The Company’s fiscal year ends on December 31.

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements. Actual amounts could differ from those estimates and such differences could be material.

Cash

Cash consists of deposits held at a custodian bank and restricted cash pledged as collateral. Cash is carried at cost, which approximates fair value. The Company deposits its cash with highly-rated banking corporations and, at times, may exceed the insured limits under applicable law.

Investments at Fair Value

Investment transactions are recorded on the trade date. Realized gains or losses are measured by the difference between the net proceeds received and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. The net change in unrealized gains or losses primarily reflects the change in investment values, including the reversal of previously recorded unrealized gains or losses with respect to investments realized during the period.Investments for which market quotations are readily available are typically valued at the bid price of those market quotations. To validate market quotations, the Company utilizes a number of factors to determine if the quotations are representative of fair value, including the source and number of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available, as is the case for substantially all of the Company’s investments, are valued at fair value as determined in good faith by the Board, based on, among other things, the input of the Adviser, the Company’s audit committee and independent third-party valuation firm(s) engaged at the direction of the Board.

As part of the valuation process, the Board takes into account relevant factors in determining the fair value of the Company’s investments, including: the estimated enterprise value of a portfolio company (i.e., the total fair value of the portfolio company’s debt and equity), the nature and realizable value of any collateral, the portfolio company’s ability to make payments based on its earnings and cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company’s securities to any similar publicly traded securities, and overall changes in the interest rate environment and the credit markets that may affect the price at which similar investments may be made in the future. When an external event such as a purchase or sale transaction, public offering or subsequent equity sale occurs, the Board considers whether the pricing indicated by the external event corroborates its valuation.

The Board undertakes a multi-step valuation process, which includes, among other procedures, the following:

 

With respect to investments for which market quotations are readily available, those investments will typically be valued at the bid price of those market quotations;

 

With respect to investments for which market quotations are not readily available, the valuation process begins with the independent valuation firm(s) providing a preliminary valuation of each investment to the Adviser’s valuation committee;

 

Preliminary valuation conclusions are documented and discussed with the Adviser’s valuation committee. Agreed upon valuation recommendations are presented to the Audit Committee;

 

The Audit Committee reviews the valuation recommendations and recommends values for each investment to the Board; and

 

The Board reviews the recommended valuations and determines the fair value of each investment.

The Company conducts this valuation process on a quarterly basis.

37


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

The Company applies Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 820, Fair Value Measurements (“ASC 820”), as amended, which establishes a framework for measuring fair value in accordance with U.S. GAAP and required disclosures of fair value measurements. ASC 820 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date.  Market participants are defined as buyers and sellers in the principal or most advantageous market (which may be a hypothetical market) that are independent, knowledgeable, and willing and able to transact.  In accordance with ASC 820, the Company considers its principal market to be the market that has the greatest volume and level of activity. ASC 820 specifies a fair value hierarchy that prioritizes and ranks the level of observability of inputs used in determination of fair value.  In accordance with ASC 820, these levels are summarized below:

 

Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

 

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

 

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

Transfers between levels, if any, are recognized at the beginning of the quarter in which the transfer occurs. In addition to using the above inputs in investment valuations, the Company applies the valuation policy approved by its Board that is consistent with ASC 820.  Consistent with the valuation policy, the Company evaluates the source of the inputs, including any markets in which its investments are trading (or any markets in which securities with similar attributes are trading), in determining fair value. When an investment is valued based on prices provided by reputable dealers or pricing services (such as broker quotes), the Company subjects those prices to various criteria in making the determination as to whether a particular investment would qualify for treatment as a Level 2 or Level 3 investment. For example, the Company, or the independent valuation firm(s), reviews pricing support provided by dealers or pricing services in order to determine if observable market information is being used, versus unobservable inputs.

Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Company’s investments may fluctuate from period to period. Additionally, the fair value of such investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If the Company were required to liquidate a portfolio investment in a forced or liquidation sale, it could realize amounts that are different from the amounts presented and such differences could be material.

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

Rule 2a-5 under the 1940 Act was recently adopted by the SEC and establishes requirements for determining fair value in good faith for purposes of the 1940 Act. The Company is evaluating the impact of adopting Rule 2a-5 on the consolidated financial statements and intends to comply with the new rule’s requirements on or before the compliance date in September 2022.

Financial and Derivative Instruments

Pursuant to ASC 815 Derivatives and Hedging, further clarified by the FASB’s issuance of the Accounting Standards Update (“ASU”) No. 2017-12, Derivatives and Hedging, which was adopted early in 2017 by the Company, all derivative instruments entered into by the Company are designated as hedging instruments. For all derivative instruments designated as a hedge, the entire change in the fair value of the hedging instrument shall be recorded in the same line item of the Consolidated Statements of Operations as the hedged item. The Company’s derivative instruments are used to hedge the Company’s fixed rate debt, and therefore both the periodic payment and the change in fair value for the effective hedge, if applicable, will be recognized as components of interest expense in the Consolidated Statements of Operations. Fair value is estimated by discounting remaining payments using applicable current market rates, or market quotes, if available.

Foreign Currency

Foreign currency amounts are translated into U.S. dollars on the following basis:

 

cash, fair value of investments, outstanding debt, other assets and liabilities: at the spot exchange rate on the last business day of the period; and

 

purchases and sales of investments, borrowings and repayments of such borrowings, income and expenses: at the rates of exchange prevailing on the respective dates of such transactions.

38


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

The Company includes net changes in fair values on investments held resulting from foreign exchange rate fluctuations with the change in unrealized gains (losses) on translation of assets and liabilities in foreign currencies on the Consolidated Statements of Operations. The Company’s current approach to hedging the foreign currency exposure in its non-U.S. dollar denominated investments is primarily to borrow the par amount in local currency under the Company’s Revolving Credit Facility to fund these investments.  Fluctuations arising from the translation of foreign currency borrowings are included with the net change in unrealized gains (losses) on translation of assets and liabilities in foreign currencies on the Consolidated Statements of Operations.

Investments denominated in foreign currencies and foreign currency transactions may involve certain considerations and risks not typically associated with those of domestic origin, including unanticipated movements in the value of the foreign currency relative to the U.S. dollar.

Interest and Dividend Income Recognition

Interest income is recorded on the accrual basis and includes amortization of discounts or premiums. Certain investments may have contractual payment-in-kind (“PIK”) interest or dividends. PIK interest represents accrued interest that is added to the principal amount of the investment on the respective interest payment dates rather than being paid in cash and generally becomes due at maturity. For the three months ended March 31, 2021, PIK interest earned was $11.6 million, representing approximately 5.2% of investment income. For the three months ended March 31, 2020, PIK interest earned was less than 5% of investment income. Discounts to par value on securities purchased are amortized into interest income over the contractual life of the respective security using the effective yield method. Premiums to par value on securities purchased are amortized to first call date. The amortized cost of investments represents the original cost adjusted for the amortization of discounts or premiums, if any. Upon prepayment of a loan or debt security, any prepayment premiums, unamortized upfront loan origination fees and unamortized discounts are recorded as interest income in the current period.

Loans are generally placed on non-accrual status when there is reasonable doubt that principal or interest will be collected in full. Accrued interest is generally reversed when a loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment regarding collectability. If at any point the Company believes PIK interest is not expected to be realized, the investment generating PIK interest will be placed on non-accrual status. When a PIK investment is placed on non-accrual status, the accrued, uncapitalized interest or dividends are generally reversed through interest income. Non-accrual loans are restored to accrual status when past due principal and interest is paid current and, in management’s judgment, are likely to remain current. Management may make exceptions to this treatment and determine to not place a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection.

Dividend income on preferred equity securities is recorded on the accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly-traded portfolio companies.

Other Income

From time to time, the Company may receive fees for services provided to portfolio companies. These fees are generally only available to the Company as a result of closing investments, are generally paid at the closing of the investments, are generally non-recurring and are recognized as revenue when earned upon closing of the investment. The services that the Adviser provides vary by investment, but can include closing, work, diligence or other similar fees and fees for providing managerial assistance to our portfolio companies.

Offering Expenses

Costs associated with the private placement offering of common shares of the Company were capitalized as deferred offering expenses and included in prepaid expenses and other assets in the Consolidated Statements of Assets and Liabilities and were amortized over a twelve-month period from incurrence. The Company records expenses related to public equity offerings as a reduction of capital upon completion of an offering of registered securities. The costs associated with renewals of the Company’s shelf registration statement will be expensed as incurred.

Debt Issuance Costs

The Company records origination and other expenses related to its debt obligations as deferred financing costs. These expenses are deferred and amortized utilizing the effective yield method, over the life of the related debt instrument. Debt issuance costs are presented on the Consolidated Statements of Assets and Liabilities as a direct deduction from the debt liability. In circumstances in which there is not an associated debt liability amount recorded in the consolidated financial statements when the debt issuance costs are incurred, such debt issuance costs will be reported on the Consolidated Statements of Assets and Liabilities as an asset until the debt liability is recorded.

39


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Reimbursement of Transaction-Related Expenses

The Company may receive reimbursement for certain transaction-related expenses in pursuing investments. Transaction-related expenses, which are generally expected to be reimbursed by the Company’s portfolio companies, are typically deferred until the transaction is consummated and are recorded in prepaid expenses and other assets on the date incurred. The costs of successfully completed investments not otherwise reimbursed are borne by the Company and are included as a component of the investment’s cost basis.

Cash advances received in respect of transaction-related expenses are recorded as cash with an offset to accrued expenses and other liabilities. Accrued expenses and other liabilities are relieved as reimbursable expenses are incurred.

Income Taxes

The Company has elected to be treated as a BDC under the 1940 Act. The Company has elected to be treated as a RIC under the Code beginning with its taxable year ending December 31, 2016 and intends to continue to qualify as a RIC. So long as the Company maintains its tax treatment as a RIC, it generally will not pay corporate-level U.S. federal income taxes on any ordinary income or capital gains that it distributes at least annually to its shareholders as dividends. Instead, any tax liability related to income earned and distributed by the Company represents obligations of the Company’s investors and will not be reflected in the consolidated financial statements of the Company.

To qualify as a RIC, the Company must, among other things, meet certain source-of-income and asset diversification requirements. In addition, to qualify for RIC tax treatment, the Company must distribute to its shareholders, for each taxable year, at least 90% of its “investment company taxable income” for that year, which is generally its ordinary income plus the excess of its realized net short-term capital gains over its realized net long-term capital losses. 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.

Certain of the Company’s consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

The Company evaluates tax positions taken or expected to be taken in the course of preparing its consolidated financial statements to determine whether the tax positions are “more-likely-than-not” to be sustained by the applicable tax authority. Tax positions not deemed to meet the “more-likely-than-not” threshold are reserved and recorded as a tax benefit or expense in the current year. All penalties and interest associated with income taxes are included in income tax expense. Conclusions regarding tax positions are subject to review and may be adjusted at a later date based on factors including, but not limited to, on-going analyses of tax laws, regulations and interpretations thereof. There were no material uncertain tax positions through December 31, 2020. The 2017 through 2019 tax years remain subject to examination by U.S. federal, state and local tax authorities.

Distributions to Common Shareholders

Distributions to common shareholders are recorded on the record date. The amount to be distributed is determined by the Board and is generally based upon the earnings estimated by the Adviser. Net realized long-term capital gains, if any, would generally be distributed at least annually, although the Company may decide to retain such capital gains for investment.

The Company has adopted a dividend reinvestment plan that provides for reinvestment of any cash distributions on behalf of shareholders, unless a shareholder elects to receive cash. As a result, if the Board authorizes and declares a cash distribution, then the shareholders who have not “opted out” of the dividend reinvestment plan will have their cash distribution automatically reinvested in additional shares of the Company’s common stock, rather than receiving the cash distribution. The Company expects to use newly issued shares to implement the dividend reinvestment plan.

Consolidation

As provided under Regulation S-X and ASC Topic 946 – Financial Services – Investment Companies, the Company will generally not consolidate its investment in a company other than a wholly-owned investment company or controlled operating company whose business consists of providing services to the Company. Accordingly, the Company consolidated the accounts of the Company’s wholly-owned subsidiaries that meet the aforementioned criteria in its consolidated financial statements.  All significant intercompany balances and transactions have been eliminated in consolidation.

The Company does not consolidate its equity interest in Sebago Lake LLC (“Sebago Lake”) or Wingspire Capital Holdings LLC (“Wingspire”).  For further description of the Company’s investment in Sebago Lake, see Note 4 “Investments”. For further

40


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

description of the Company’s investment in Wingspire, see Note 3Agreements and Related Party Transactions – Controlled/Affiliated Portfolio Companies”.

New Accounting Pronouncements

In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848),” which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts, hedging relationships, and other transactions that reference London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU No. 2021-01, “Reference Rate Reform (Topic 848),” which expanded the scope of Topic 848 to include derivative instruments impacted by discounting transition. ASU 2020-04 and ASU 2021-01 are effective for all entities through December 31, 2022. ASU No. 2021-01 provides increased clarity as the Company continues to evaluate the transition of reference rates and is currently evaluating the impact of adopting ASU No. 2020-04 and 2021-01 on the consolidated financial statements.

Other than the aforementioned guidance, the Company’s management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying consolidated financial statements.

 

Note 3. Agreements and Related Party Transactions

Administration Agreement

The Company has entered into an Administration Agreement (the “Administration Agreement”) with the Adviser. Under the terms of the Administration Agreement, the Adviser performs, or oversees, the performance of, required administrative services, which includes providing office space, equipment and office services, maintaining financial records, preparing reports to shareholders and reports filed with the SEC, and managing the payment of expenses and the performance of administrative and professional services rendered by others.

The Administration Agreement also provides that the Company reimburses the Adviser for certain organization costs incurred prior to the commencement of the Company’s operations, and for certain offering costs.

The Company reimburses the Adviser for services performed for it pursuant to the terms of the Administration Agreement. In addition, pursuant to the terms of the Administration Agreement, the Adviser may delegate its obligations under the Administration Agreement to an affiliate or to a third party and the Company will reimburse the Adviser for any services performed for it by such affiliate or third party.

Unless earlier terminated as described below, the Administration Agreement, and subject to the consummation of the Transaction, the amended and restated administration agreement, will remain in effect from year to year if approved annually by (1) the vote of the Board, or by the vote of a majority of its outstanding voting securities, and (2) the vote of a majority of the Company’s directors who are not “interested persons” of the Company, of the Adviser or of any of their respective affiliates, as defined in the 1940 Act. The Administration Agreement may be terminated at any time, without the payment of any penalty, on 60 days’ written notice, by the vote of a majority of the outstanding voting securities of the Company, or by the vote of the Board or by the Adviser.

On December 23, 2020, Owl Rock Capital Group, the parent of the Adviser (and a subsidiary of Owl Rock Capital Partners), and Dyal announced they are merging to form Blue Owl.  Blue Owl will enter the public market via its acquisition by Altimar, a special purpose acquisition company sponsored by an affiliate of HPS Investment Partners, LLC. The Board has determined that upon consummation of the Transaction, the Company should enter into an amended and restated administration agreement with the Adviser on terms that are identical to the Administration Agreement.

No person who is an officer, director, or employee of the Adviser or its affiliates and who serves as a director of the Company receives any compensation from the Company for his or her services as a director. However, the Company reimburses the Adviser (or its affiliates) for an allocable portion of the compensation paid by the Adviser or its affiliates to the Company’s Chief Compliance Officer, Chief Financial Officer and their respective staffs (based on the percentage of time those individuals devote, on an estimated basis, to the business and affairs of the Company). Directors who are not affiliated with the Adviser receive compensation for their services and reimbursement of expenses incurred to attend meetings.

For the three months ended March 31, 2021 and 2020, the Company incurred expenses of approximately $1.2 million and $1.8 million, respectively, for costs and expenses reimbursable to the Adviser under the terms of the Administration Agreement.

41


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Investment Advisory Agreement

The Company has entered into an amended and restated Investment Advisory Agreement (the “Investment Advisory Agreement”) with the Adviser.

Under the terms of the Investment Advisory Agreement, the Adviser is responsible for managing the Company’s business and activities, including sourcing investment opportunities, conducting research, performing diligence on potential investments, structuring its investments, and monitoring its portfolio companies on an ongoing basis through a team of investment professionals.

The Adviser’s services under the Investment Advisory Agreement are not exclusive, and it is free to furnish similar services to other entities so long as its services to the Company are not impaired.

Unless earlier terminated as described below, the Investment Advisory Agreement, and subject to the consummation of the Transaction, the third amended and restated investment advisory agreement, will remain in effect from year-to-year if approved annually by a majority of the Board or by the holders of a majority of our outstanding voting securities and, in each case, by a majority of independent directors.

The Investment Advisory Agreement will automatically terminate within the meaning of the 1940 Act and related SEC guidance and interpretations in the event of its assignment. In accordance with the 1940 Act, without payment of any penalty, the Company may terminate the Investment Advisory Agreement with the Adviser upon 60 days’ written notice. The decision to terminate the agreement may be made by a majority of the Board or the shareholders holding a majority (as defined under the 1940 Act) of the outstanding shares of the Company’s common stock or the Adviser. In addition, without payment of any penalty, the Adviser may generally terminate the Investment Advisory Agreement upon 60 days’ written notice and, in certain circumstances, the Adviser may only be able to terminate the Investment Advisory Agreement upon 120 days’ written notice.

On December 23, 2020, Owl Rock Capital Group, the parent of the Adviser (and a subsidiary of Owl Rock Capital Partners), and Dyal announced they are merging to form Blue Owl.  Blue Owl will enter the public market via its acquisition by Altimar, a special purpose acquisition company sponsored by an affiliate of HPS Investment Partners, LLC. The Transaction, if consummated, will result in a change in control of the Adviser, which will be deemed an assignment of the Investment Advisory Agreement in accordance with the 1940 Act. As a result, the Board, after considering the Transaction and subsequent change in control, has determined that upon consummation of the Transaction, the Company should enter into a third amended and restated investment advisory agreement with the Adviser on terms that are identical to the Investment Advisory Agreement. At a special meeting of the Company's shareholders held on March 17, 2021, the Company's shareholders approved the Company's entry, upon consummation of the Transaction, into the third amended and restated advisory agreement with the Adviser on terms that are identical to the the Advisory Agreement.

From time to time, the Adviser may pay amounts owed by the Company to third-party providers of goods or services, including the Board, and the Company will subsequently reimburse the Adviser for such amounts paid on its behalf. Amounts payable to the Adviser are settled in the normal course of business without formal payment terms.

Under the terms of the Investment Advisory Agreement, the Company will pay the Adviser a base management fee and may also pay to it certain incentive fees. The cost of both the management fee and the incentive fee will ultimately be borne by the Company’s shareholders.

The management fee is currently payable quarterly in arrears. Prior to the Listing Date, the management fee was payable at an annual rate of 0.75% of the Company’s (i) average gross assets, excluding cash and cash equivalents but including assets purchased with borrowed amounts, at the end of the Company’s two most recently completed calendar quarters plus (ii) the average of any remaining unfunded Capital Commitments at the end of the two most recently completed calendar quarters.

The management fee is payable at an annual rate of (x) 1.50% of the Company’s average gross assets (excluding cash and cash equivalents, but including assets purchased with borrowed amounts) that is above an asset coverage ratio of 200% calculated in accordance with Sections 18 and 61 of the 1940 Act and (y) 1.00% of the Company’s average gross assets (excluding cash and cash equivalents, but including assets purchased with borrowed amounts) that is below an asset coverage ratio of 200% calculated in accordance with Section 18 and 61 of the 1940 Act, in each case, at the end of the two most recently completed calendar quarters. The management fee for any partial month or quarter, as the case may be, will be appropriately prorated and adjusted for any share issuances or repurchases during the relevant calendar months or quarters, as the case may be.

On February 27, 2019, the Adviser agreed at all times prior to the fifteen-month anniversary of the Listing Date, to waive any portion of the Management Fee that is in excess of 0.75% of the Company’s gross assets, excluding cash and cash-equivalents but including assets purchased with borrowed amounts at the end of the two most recently completed calendar quarters, calculated in

42


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

accordance with the Investment Advisory Agreement. The Listing Date occurred on July 18, 2019 and this waiver expired on October 18, 2020.

For the three months ended March 31, 2021, management fees were $42.1 million. For the three months ended March 31, 2020, management fees, net of $16.9 million in management fee waivers, were $16.9 million.

The incentive fee consists of two components that are independent of each other, with the result that one component may be payable even if the other is not. A portion of the incentive fee is based on the Company’s pre-incentive fee net investment income and a portion is based on the Company’s capital gains. The portion of the incentive fee based on pre-incentive fee net investment income is determined and paid quarterly in arrears commencing with the first calendar quarter following the Listing Date, and equals 100% of the pre-incentive fee net investment income in excess of a 1.5% quarterly “hurdle rate,” until the Adviser has received 17.5% of the total pre-incentive fee net investment income for that calendar quarter and, for pre-incentive fee net investment income in excess of 1.82% quarterly, 17.5% of all remaining pre-incentive fee net investment income for that calendar quarter.

The second component of the incentive fee, the capital gains incentive fee, payable at the end of each calendar year in arrears, equals 17.5% of cumulative realized capital gains from the Listing Date to the end of each calendar year, less cumulative realized capital losses and unrealized capital depreciation from the Listing Date to the end of each calendar year, less the aggregate amount of any previously paid capital gains incentive fee for prior periods. In no event will the capital gains incentive fee payable pursuant to the Investment Advisory Agreement be in excess of the amount permitted by the Advisers Act of 1940, as amended, including Section 205 thereof.

While the Investment Advisory Agreement neither includes nor contemplates the inclusion of unrealized gains in the calculation of the capital gains incentive fee, as required by U.S. GAAP, the Company accrues capital gains incentive fees on unrealized gains. This accrual reflects the incentive fees that would be payable to the Adviser if the Company’s entire investment portfolio was liquidated at its fair value as of the balance sheet date even though the Adviser is not entitled to an incentive fee with respect to unrealized gains unless and until such gains are actually realized.

On February 27, 2019, the Adviser agreed at all times prior to the fifteen-month anniversary of the Listing Date to waive the entire incentive fee (including, for the avoidance of doubt, both the portion of the incentive fee based on the Company’s income and the capital gains incentive fee). This waiver expired on October 18, 2020.

For the three months ended March 31, 2021, the Company incurred $21.8 million of performance based incentive fees based on net investment income. For the three months ended March 31, 2020, due to the fee waiver of $25.6 million, the Company did not incur any performance based incentive fees on net investment income.

For the three months ended March 31, 2021 and 2020, the Company did not accrue capital gains based incentive fees (net of waivers).

Any portion of the management fee, incentive fee on net investment income and capital gains based incentive fee waived shall not be subject to recoupment.

Affiliated Transactions

The Company may be prohibited under the 1940 Act from participating in certain transactions with its affiliates without prior approval of the directors who are not interested persons, and in some cases, the prior approval of the SEC.  The Company, the Adviser and certain of their affiliates have been granted exemptive relief by the SEC for the Company to co-invest with other funds managed by the Adviser or its affiliates in a manner consistent with the Company’s investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. Pursuant to such exemptive relief, the Company generally is permitted to co-invest with certain of its affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act) of the Board make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transaction, including the consideration to be paid, are reasonable and fair to the Company and its shareholders and do not involve overreaching of the Company or its shareholders on the part of any person concerned, (2) the transaction is consistent with the interests of the Company’s shareholders and is consistent with its investment objective and strategies, and (3) the investment by its affiliates would not disadvantage the Company, and the Company’s participation would not be on a basis different from or less advantageous than that on which its affiliates are investing. In addition, pursuant to an exemptive order issued by the SEC on April 8, 2020 and applicable to all BDCs, through December 31, 2020, the Company was permitted, subject to the satisfaction of certain conditions, to complete follow-on investments in its existing portfolio companies with certain private funds managed by the Adviser or its affiliates and covered by the Company’s exemptive relief, even if such private funds had not previously invested in such existing portfolio company. Without this order, private funds would generally not be able to participate in such follow-on investments with the Company unless the private funds had previously acquired securities of the portfolio company in a co-investment transaction with the Company. Although the conditional exemptive order has expired, the SEC’s Division of Investment  Management has indicated that until March 31, 2022, it

43


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

will not recommend enforcement action, to the extent that any BDC with an existing coinvestment order continues to engage in certain transactions described in the conditional exemptive order, pursuant to the same terms and conditions described therein. The Adviser is under common control with Owl Rock Technology Advisors LLC (“ORTA”), Owl Rock Capital Private Fund Advisors LLC (“ORPFA”) and Owl Rock Diversified Advisors LLC (“ORDA”), which are also investment advisers and indirect subsidiaries of Owl Rock Capital Partners. The Adviser, ORTA, ORPFA and ORDA are referred to as the “Owl Rock Advisers” and together with Owl Rock Capital Partners are referred to, collectively, as “Owl Rock.” Owl Rock Advisers’ allocation policy seeks to ensure equitable allocation of investment opportunities over time between the Company, Owl Rock Capital Corporation II, a BDC advised by the Adviser, Owl Rock Technology Finance Corp., a BDC advised by ORTA, Owl Rock Capital Corporation III, a BDC advised by ORDA, Owl Rock Core Income Corp., a BDC advised by the Adviser and other funds managed by the Adviser or its affiliates (collectively, the "Owl Rock Clients"). As a result of exemptive relief, there could be significant overlap in the Company’s investment portfolio and the investment portfolio of the Owl Rock Clients and/or other funds established by the Adviser or its affiliates that could avail themselves of the exemptive relief.

License Agreement

The Company has entered into a license agreement (the “License Agreement”), pursuant to which an affiliate of Owl Rock Capital Partners LP has granted the Company a non-exclusive license to use the name “Owl Rock.” Under the License Agreement, the Company has a right to use the Owl Rock name for so long as the Adviser or one of its affiliates remains the Company’s investment adviser. Other than with respect to this limited license, the Company will have no legal right to the “Owl Rock” name or logo.

Controlled/Affiliated Portfolio Companies

Under the 1940 Act, the Company is required to separately identify non-controlled investments where it owns 5% or more of a portfolio company’s outstanding voting securities and/or has the power to exercise control over the management or policies of such portfolio company as investments in “affiliated” companies. In addition, under the 1940 Act, the Company is required to separately identify investments where it owns more than 25% of a portfolio company’s outstanding voting securities and/or has the power to exercise control over the management or policies of such portfolio company as investments in “controlled” companies. Under the 1940 Act, “non-affiliated investments” are defined as investments that are neither controlled investments nor affiliated investments. Detailed information with respect to the Company’s non-controlled, non-affiliated; non-controlled, affiliated; and controlled affiliated investments is contained in the accompanying consolidated financial statements, including the consolidated schedule of investments.

The Company has made investments in three controlled/affiliated companies, including Sebago Lake, Wingspire and Swipe Acquisition Corporation. For further description of Sebago Lake, see “Note 4. Investments”. Wingspire conducts its business through an indirectly owned subsidiary, Wingspire Capital LLC. Wingspire is an independent diversified direct lender focused on providing asset-based commercial finance loans and related senior secured loans to U.S.-based middle market borrowers. Wingspire offers a wide variety of asset-based financing solutions to businesses in an array of industries, including revolving credit facilities, machinery and equipment term loans, real estate term loans, first-in/last-out tranches, cash flow term loans, and opportunistic / bridge financings. The addition of Wingspire to the portfolio allows ORCC to participate in an asset class that offers differentiated yield with full collateral packages and covenants. Wingspire is led by a seasoned team of commercial finance veterans. The Company committed $50 million to Wingspire on September 24, 2019, and subsequently increased its commitment to $100 million on March 25, 2020, to $150 million on July 31, 2020 and again to $200 million on March 8, 2021. The Company does not consolidate its equity interest in Wingspire.

 

Note 4. Investments

The information in the tables below is presented on an aggregate portfolio basis, without regard to whether they are non-controlled non-affiliated, non-controlled affiliated or controlled affiliated investments.

44


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Investments at fair value and amortized cost consisted of the following as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

($ in thousands)

 

Amortized Cost

 

 

Fair Value

 

 

Amortized Cost

 

 

Fair Value

 

First-lien senior secured debt investments

 

$

8,781,815

 

 

$

8,744,469

 

 

$

8,483,799

 

 

$

8,404,754

 

Second-lien senior secured debt investments

 

 

1,837,093

 

 

 

1,807,521

 

 

 

2,035,151

 

 

 

2,000,471

 

Unsecured debt investments

 

 

188,935

 

 

 

191,211

 

 

 

56,473

 

 

 

59,562

 

Equity investments(1)

 

 

355,068

 

 

 

389,155

 

 

 

245,458

 

 

 

271,739

 

Investment funds and vehicles(2)

 

 

109,838

 

 

 

108,116

 

 

 

107,837

 

 

 

105,546

 

Total Investments

 

$

11,272,749

 

 

$

11,240,472

 

 

$

10,928,718

 

 

$

10,842,072

 

________________

 

(1)

Includes equity investment in Wingspire.

 

(2)

Includes equity investment in Sebago Lake.  See below, within Note 4, for more information regarding Sebago Lake.

 

 

The industry composition of investments based on fair value as of March 31, 2021 and December 31, 2020 was as follows:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

Advertising and media

 

 

0.9

 

%

 

1.0

 

%

Aerospace and defense

 

 

2.8

 

 

 

2.7

 

 

Automotive

 

 

1.7

 

 

 

1.6

 

 

Buildings and real estate

 

 

4.9

 

 

 

5.6

 

 

Business services

 

 

5.4

 

 

 

5.7

 

 

Chemicals

 

 

3.6

 

 

 

2.2

 

 

Consumer products

 

 

2.2

 

 

 

2.3

 

 

Containers and packaging

 

 

1.9

 

 

 

2.0

 

 

Distribution

 

 

6.0

 

 

 

6.3

 

 

Education

 

 

2.2

 

 

 

2.6

 

 

Energy equipment and services

 

 

0.1

 

 

 

0.1

 

 

Financial services(1)

 

 

5.0

 

 

 

2.9

 

 

Food and beverage

 

 

8.3

 

 

 

8.7

 

 

Healthcare equipment and services

 

 

4.8

 

 

 

3.7

 

 

Healthcare providers and services

 

 

5.3

 

 

 

5.2

 

 

Healthcare technology

 

 

3.3

 

 

 

3.6

 

 

Household products

 

 

2.0

 

 

 

1.4

 

 

Human resource support services(3)

 

 

0.0

 

 

 

0.0

 

 

Infrastructure and environmental services

 

 

1.7

 

 

 

1.8

 

 

Insurance

 

 

8.4

 

 

 

8.9

 

 

Internet software and services

 

 

10.3

 

 

 

11.1

 

 

Investment funds and vehicles(2)

 

 

1.0

 

 

 

1.0

 

 

Leisure and entertainment

 

 

1.9

 

 

 

2.0

 

 

Manufacturing

 

 

5.3

 

 

 

5.3

 

 

Oil and gas

 

 

1.6

 

 

 

1.7

 

 

Professional services

 

 

4.9

 

 

 

5.6

 

 

Specialty retail

 

 

2.1

 

 

 

2.1

 

 

Telecommunications

 

 

0.1

 

 

 

0.5

 

 

Transportation

 

 

2.3

 

 

 

2.4

 

 

Total

 

 

100.0

 

%

 

100.0

 

%

________________

 

(1)

Includes equity investment in Wingspire.

 

(2)

Includes equity investment in Sebago Lake. See below, within Note 4, for more information regarding Sebago Lake.

 

(3)

Rounds to less than 0.1%.

 

45


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

The geographic composition of investments based on fair value as of March 31, 2021 and December 31, 2020 was as follows:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

United States:

 

 

 

 

 

 

 

 

 

Midwest

 

 

17.7

 

%

 

18.2

 

%

Northeast

 

 

16.1

 

 

 

16.7

 

 

South

 

 

42.7

 

 

 

42.3

 

 

West

 

 

17.0

 

 

 

17.2

 

 

International

 

 

6.5

 

 

 

5.6

 

(1)

Total

 

 

100.0

 

%

 

100.0

 

%

________________

 

(1)

As of December 31, 2020, the geographic composition of Belgium, Canada, Israel and the United Kingdom were 0.8%, 1.0%, 0.4% and 3.4%, respectively.  

Sebago Lake LLC

 

Sebago Lake, a Delaware limited liability company, was formed as a joint venture between the Company and The Regents of the University of California (“Regents”) and commenced operations on June 20, 2017. Sebago Lake’s principal purpose is to make investments, primarily in senior secured loans that are made to middle-market companies or in broadly syndicated loans. Both the Company and Regents (the “Members”) have a 50% economic ownership in Sebago Lake. Except under certain circumstances, contributions to Sebago Lake cannot be redeemed. Each of the Members initially agreed to contribute up to $100 million to Sebago Lake. On July 26, 2018, each of the Members increased their contribution to Sebago Lake up to an aggregate of $125 million. As of March 31, 2021, each Member has funded $109.8 million of their respective $125 million commitments. Sebago Lake is managed by the Members, each of which have equal voting rights. Investment decisions must be approved by each of the Members.

The Company has determined that Sebago Lake is an investment company under ASC 946; however, in accordance with such guidance, the Company will generally not consolidate its investment in a company other than a wholly owned investment company subsidiary or a controlled operating company whose business consists of providing services to the Company. Other than for purposes of the 1940 Act, the Company does not believe that it has control over this portfolio company. Accordingly, the Company does not consolidate its non-controlling interest in Sebago Lake.

As of March 31, 2021 and December 31, 2020, Sebago Lake had total investments in senior secured debt at fair value of $539.1 million and $554.7 million, respectively. The determination of fair value is in accordance with ASC 820; however, such fair value is not included in the Board’s valuation process described herein. The following table is a summary of Sebago Lake’s portfolio as well as a listing of the portfolio investments in Sebago Lake’s portfolio as of March 31, 2021 and December 31, 2020:

 

($ in thousands)

 

March 31, 2021

 

 

December 31, 2020

 

Total senior secured debt investments(1)

 

$

546,400

 

 

$

563,555

 

Weighted average spread over LIBOR(1)

 

 

4.43

%

 

 

4.45

%

Number of portfolio companies

 

16

 

 

17

 

Largest funded investment to a single borrower(1)

 

$

49,500

 

 

$

49,625

 

________________

 

(1)

At par.

 

46


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Sebago Lake's Portfolio as of March 31, 2021

($ in thousands)

(Unaudited)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aerospace and defense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)

 

First lien senior secured loan

 

L + 5.25%

 

12/21/2023

 

$

34,739

 

 

$

34,396

 

 

$

34,327

 

 

 

15.9

 

%

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)(14)

 

First lien senior secured revolving loan

 

L + 5.25%

 

12/21/2022

 

 

3,000

 

 

 

2,980

 

 

 

2,964

 

 

 

1.4

 

%

Bleriot US Bidco Inc.(7)(10)

 

First lien senior secured loan

 

L + 4.00%

 

10/30/2026

 

 

19,800

 

 

 

19,680

 

 

 

19,735

 

 

 

9.1

 

%

Dynasty Acquisition Co., Inc. (dba StandardAero Limited)(7)

 

First lien senior secured loan

 

L + 3.50%

 

4/6/2026

 

 

39,400

 

 

 

39,253

 

 

 

35,907

 

 

 

16.6

 

%

 

 

 

 

 

 

 

 

 

96,939

 

 

 

96,309

 

 

 

92,933

 

 

 

43.0

 

%

Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vistage Worldwide, Inc.(7)

 

First lien senior secured loan

 

L + 4.00%

 

2/10/2025

 

 

16,584

 

 

 

16,517

 

 

 

16,501

 

 

 

7.6

 

%

Distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dealer Tire, LLC (6)(10)

 

First lien senior secured loan

 

L + 4.25%

 

12/12/2025

 

 

36,537

 

 

 

36,365

 

 

 

36,552

 

 

 

16.9

 

%

Education

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/30/2025

 

 

34,125

 

 

 

34,056

 

 

 

32,776

 

 

 

15.2

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DecoPac, Inc.(7)

 

First lien senior secured loan

 

L + 4.25%

 

9/30/2024

 

 

20,561

 

 

 

20,506

 

 

 

20,561

 

 

 

9.5

 

%

DecoPac, Inc.(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

9/29/2023

 

 

-

 

 

 

(7

)

 

 

(30

)

 

 

 

%

FQSR, LLC (dba KBP Investments)(7)

 

First lien senior secured loan

 

L + 5.00%

 

5/15/2023

 

 

24,196

 

 

 

24,041

 

 

 

24,229

 

 

 

11.2

 

%

FQSR, LLC (dba KBP Investments)(8)(11)(13)

 

First lien senior secured delayed draw term loan

 

L + 5.00%

 

9/18/2022

 

 

17,987

 

 

 

17,799

 

 

 

18,012

 

 

 

8.3

 

%

Sovos Brands Intermediate, Inc.(8)

 

First lien senior secured loan

 

L + 4.75%

 

11/20/2025

 

 

43,987

 

 

 

43,683

 

 

 

43,987

 

 

 

20.3

 

%

 

 

 

 

 

 

 

 

 

106,731

 

 

 

106,022

 

 

 

106,759

 

 

 

49.3

 

%

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cadence, Inc.(6)

 

First lien senior secured loan

 

L + 4.50%

 

5/21/2025

 

 

26,921

 

 

 

26,498

 

 

 

26,406

 

 

 

12.2

 

%

Cadence, Inc.(9)(11)(14)

 

First lien senior secured revolving loan

 

P + 3.50%

 

5/21/2023

 

 

2,936

 

 

 

2,857

 

 

 

2,795

 

 

 

1.3

 

%

 

 

 

 

 

 

 

 

 

29,857

 

 

 

29,355

 

 

 

29,201

 

 

 

13.5

 

%

Healthcare technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VVC Holdings Corp. (dba Athenahealth, Inc.)(7)(10)

 

First lien senior secured loan

 

L + 4.25%

 

2/11/2026

 

 

17,309

 

 

 

17,053

 

 

 

17,323

 

 

 

8.0

 

%

Infrastructure and environmental services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHA Holding, Inc.(7)

 

First lien senior secured loan

 

L + 4.50%

 

4/10/2025

 

 

41,039

 

 

 

40,771

 

 

 

40,767

 

 

 

18.9

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Integro Parent Inc.(6)

 

First lien senior secured loan

 

L + 5.75%

 

10/31/2022

 

 

29,945

 

 

 

29,886

 

 

 

30,002

 

 

 

13.9

 

%

Integro Parent Inc.(6)(11)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

4/30/2022

 

 

3,504

 

 

 

3,499

 

 

 

3,462

 

 

 

1.6

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(8)

 

First lien senior secured loan

 

L + 4.25%

 

3/29/2025

 

 

40,046

 

 

 

39,434

 

 

 

39,545

 

 

 

18.3

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

3/29/2024

 

 

-

 

 

 

(78

)

 

 

(94

)

 

 

 

%

 

 

 

 

 

 

 

 

 

73,495

 

 

 

72,741

 

 

 

72,915

 

 

 

33.8

 

%

47


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Sebago Lake's Portfolio as of March 31, 2021

($ in thousands)

(Unaudited)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Internet software and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DCert Buyer, Inc. (dba DigiCert)(6)(10)

 

First lien senior secured loan

 

L + 4.00%

 

10/16/2026

 

 

49,500

 

 

 

49,347

 

 

 

49,371

 

 

 

22.8

 

%

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Engineered Machinery Holdings (dba Duravant)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/19/2024

 

 

44,284

 

 

 

43,979

 

 

 

43,952

 

 

 

20.3

 

%

Total Debt Investments

 

 

 

 

 

 

 

 

546,400

 

 

 

542,515

 

 

 

539,050

 

 

 

249.3

 

%

Total Investments

 

 

 

 

 

 

 

$

546,400

 

 

$

542,515

 

 

$

539,050

 

 

 

249.3

 

%

________________

 

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

 

(2)

Unless otherwise indicated, Sebago Lake’s investments are pledged as collateral supporting the amounts outstanding under Sebago Lake’s credit facility.

 

(3)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

 

(4)

Unless otherwise indicated, all investments are considered Level 3 investments.

 

(5)

Unless otherwise indicated, loan contains a variable rate structure, and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) (which can include one-, two-, three- or six-month LIBOR) or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option, and which reset periodically based on the terms of the loan agreement.

 

(6)

The interest rate on these loans is subject to 1 month LIBOR, which as of March 31, 2021 was 0.11%.

 

(7)

The interest rate on these loans is subject to 3 month LIBOR, which as of March 31, 2021 was 0.19%.

 

(8)

The interest rate on these loans is subject to 6 month LIBOR, which as of March 31, 2021 was 0.21%.

 

(9)

The interest rate on these loans is subject to Prime, which as of March 31, 2021 was 3.25%.

 

(10)

Level 2 investment.

 

(11)

Position or portion thereof is an unfunded loan commitment.

 

(12)

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

 

(13)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

 

(14)

Investment is not pledged as collateral under Sebago Lake’s credit facility.

 

48


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Sebago Lake's Portfolio as of December 31, 2020

($ in thousands)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aerospace and defense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)

 

First lien senior secured loan

 

L + 5.25%

 

12/21/2023

 

$

34,829

 

 

$

34,455

 

 

$

34,671

 

 

 

16.4

 

%

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)(14)

 

First lien senior secured revolving loan

 

L + 5.25%

 

12/21/2022

 

 

3,000

 

 

 

2,977

 

 

 

2,986

 

 

 

1.4

 

%

Bleriot US Bidco Inc.(7)(10)

 

First lien senior secured loan

 

L + 4.75%

 

10/30/2026

 

 

14,888

 

 

 

14,762

 

 

 

14,827

 

 

 

6.9

 

%

Dynasty Acquisition Co., Inc. (dba StandardAero Limited)(7)

 

First lien senior secured loan

 

L + 3.50%

 

4/4/2026

 

 

39,500

 

 

 

39,345

 

 

 

35,826

 

 

 

17.0

 

%

 

 

 

 

 

 

 

 

 

92,217

 

 

 

91,539

 

 

 

88,310

 

 

 

41.7

 

%

Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vistage Worldwide, Inc.(7)

 

First lien senior secured loan

 

L + 4.00%

 

2/10/2025

 

 

16,584

 

 

 

16,513

 

 

 

16,418

 

 

 

7.8

 

%

Distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dealer Tire, LLC (6)(10)

 

First lien senior secured loan

 

L + 4.25%

 

12/12/2025

 

 

36,630

 

 

 

36,449

 

 

 

36,293

 

 

 

17.2

 

%

Education

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/30/2025

 

 

34,212

 

 

 

34,140

 

 

 

32,456

 

 

 

15.4

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DecoPac, Inc.(7)

 

First lien senior secured loan

 

L + 4.25%

 

9/30/2024

 

 

20,561

 

 

 

20,503

 

 

 

20,561

 

 

 

9.7

 

%

DecoPac, Inc.(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

9/29/2023

 

 

-

 

 

 

(8

)

 

 

(55

)

 

 

 

%

FQSR, LLC (dba KBP Investments)(7)

 

First lien senior secured loan

 

L + 5.00%

 

5/15/2023

 

 

24,259

 

 

 

24,086

 

 

 

24,213

 

 

 

11.5

 

%

FQSR, LLC (dba KBP Investments)(8)(11)(13)

 

First lien senior secured delayed draw term loan

 

L + 5.00%

 

9/10/2021

 

 

17,987

 

 

 

17,778

 

 

 

17,943

 

 

 

8.5

 

%

Sovos Brands Intermediate, Inc.(7)

 

First lien senior secured loan

 

L + 4.75%

 

11/20/2025

 

 

44,100

 

 

 

43,780

 

 

 

44,100

 

 

 

20.9

 

%

 

 

 

 

 

 

 

 

 

106,907

 

 

 

106,139

 

 

 

106,762

 

 

 

50.6

 

%

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cadence, Inc.(6)

 

First lien senior secured loan

 

L + 4.50%

 

5/21/2025

 

 

26,990

 

 

 

26,543

 

 

 

26,446

 

 

 

12.5

 

%

Cadence, Inc.(9)(11)(14)

 

First lien senior secured revolving loan

 

P + 3.50%

 

5/21/2025

 

 

2,936

 

 

 

2,848

 

 

 

2,788

 

 

 

1.3

 

%

 

 

 

 

 

 

 

 

 

29,926

 

 

 

29,391

 

 

 

29,234

 

 

 

13.8

 

%

Healthcare technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VVC Holdings Corp. (dba Athenahealth, Inc.)(6)(10)

 

First lien senior secured loan

 

L + 4.50%

 

2/11/2026

 

 

17,309

 

 

 

17,041

 

 

 

17,262

 

 

 

8.2

 

%

Infrastructure and environmental services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHA Holding, Inc.(7)

 

First lien senior secured loan

 

L + 4.50%

 

4/10/2025

 

 

41,145

 

 

 

40,861

 

 

 

40,857

 

 

 

19.4

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Integro Parent Inc.(6)

 

First lien senior secured loan

 

L + 5.75%

 

10/31/2022

 

 

30,055

 

 

 

29,987

 

 

 

30,014

 

 

 

14.2

 

%

Integro Parent Inc.(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.50%

 

4/30/2022

 

 

-

 

 

 

(7

)

 

 

(28

)

 

 

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(8)

 

First lien senior secured loan

 

L + 4.25%

 

3/29/2025

 

 

40,149

 

 

 

39,502

 

 

 

39,446

 

 

 

18.7

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

3/29/2024

 

 

-

 

 

 

(84

)

 

 

(131

)

 

 

(0.1

)

%

 

 

 

 

 

 

 

 

 

70,204

 

 

 

69,398

 

 

 

69,301

 

 

 

32.8

 

%

49


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Sebago Lake's Portfolio as of December 31, 2020

($ in thousands)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Internet software and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DCert Buyer, Inc. (dba DigiCert)(6)(10)

 

First lien senior secured loan

 

L + 4.00%

 

10/16/2026

 

 

49,625

 

 

 

49,466

 

 

 

49,511

 

 

 

23.5

 

%

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Engineered Machinery Holdings (dba Duravant)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/19/2024

 

 

44,397

 

 

 

44,071

 

 

 

43,841

 

 

 

20.8

 

%

Transportation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Uber Technologies, Inc.(6)(10)

 

First lien senior secured loan

 

L + 4.00%

 

4/4/2025

 

 

24,399

 

 

 

24,290

 

 

 

24,465

 

 

 

11.6

 

%

Total Debt Investments

 

 

 

 

 

 

 

 

563,555

 

 

 

559,298

 

 

 

554,710

 

 

 

262.8

 

%

Total Investments

 

 

 

 

 

 

 

$

563,555

 

 

$

559,298

 

 

$

554,710

 

 

 

262.8

 

%

________________

 

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

 

(2)

Unless otherwise indicated, Sebago Lake’s investments are pledged as collateral supporting the amounts outstanding under Sebago Lake’s credit facility.

 

(3)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

 

(4)

Unless otherwise indicated, all investments are considered Level 3 investments.

 

(5)

Unless otherwise indicated, loan contains a variable rate structure, and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) (which can include one-, two-, three- or six-month LIBOR) or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option, and which reset periodically based on the terms of the loan agreement.

 

(6)

The interest rate on these loans is subject to 1 month LIBOR, which as of December 31, 2020 was 0.14%.

 

(7)

The interest rate on these loans is subject to 3 month LIBOR, which as of December 31, 2020 was 0.24%.

 

(8)

The interest rate on these loans is subject to 6 month LIBOR, which as of December 31, 2020 was 0.26%.

 

(9)

The interest rate on these loans is subject to Prime, which as of December 31, 2020 was 3.25%.

 

(10)

Level 2 investment.

 

(11)

Position or portion thereof is an unfunded loan commitment.

 

(12)

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

 

(13)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

 

(14)

Investment is not pledged as collateral under Sebago Lake’s credit facility.

 

50


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Below is selected balance sheet information for Sebago Lake as of March 31, 2021 and December 31, 2020:

 

($ in thousands)

 

March 31, 2021

(Unaudited)

 

 

December 31, 2020

 

Assets

 

 

 

 

 

 

 

 

Investments at fair value (amortized cost of $542,515 and $559,298, respectively)

 

$

539,050

 

 

$

554,710

 

Cash

 

 

29,268

 

 

 

9,385

 

Interest receivable

 

 

1,032

 

 

 

992

 

Prepaid expenses and other assets

 

 

197

 

 

 

237

 

Total Assets

 

$

569,547

 

 

$

565,324

 

Liabilities

 

 

 

 

 

 

 

 

Debt (net of unamortized debt issuance costs of $2,048 and $2,415, respectively)

 

$

346,834

 

 

$

347,564

 

Distributions payable

 

 

4,735

 

 

 

4,694

 

Accrued expenses and other liabilities

 

 

1,747

 

 

 

1,975

 

Total Liabilities

 

$

353,316

 

 

$

354,233

 

Members' Equity

 

 

 

 

 

 

 

 

Members' Equity

 

 

216,231

 

 

 

211,091

 

Members' Equity

 

 

216,231

 

 

 

211,091

 

Total Liabilities and Members' Equity

 

$

569,547

 

 

$

565,324

 

 

Below is selected statement of operations information for Sebago Lake for the three months ended March 31, 2021 and 2020:

 

 

 

For the Three Months Ended March 31,

 

($ in thousands)

 

2021

 

 

2020

 

Investment Income

 

 

 

 

 

 

 

 

Interest income

 

$

7,366

 

 

$

8,502

 

Other income

 

 

148

 

 

 

92

 

Total Investment Income

 

 

7,514

 

 

 

8,594

 

Expenses

 

 

 

 

 

 

 

 

Loan origination and structuring fee

 

 

 

 

 

 

Interest expense

 

 

2,503

 

 

 

3,784

 

Professional fees

 

 

189

 

 

 

167

 

Total Expenses

 

 

2,692

 

 

 

3,951

 

Net Investment Income Before Taxes

 

 

4,822

 

 

 

4,643

 

Taxes

 

 

207

 

 

 

(895

)

Net Investment Income After Taxes

 

$

4,615

 

 

$

5,538

 

Net Realized and Change in Unrealized Gain (Loss) on Investments

 

 

 

 

 

 

 

 

Net change in unrealized gain (loss) on investments

 

 

1,123

 

 

 

(30,960

)

Net realized gain (loss) on investments

 

 

137

 

 

 

 

Total Net Realized and Change in Unrealized Gain (Loss) on Investments

 

 

1,260

 

 

 

(30,960

)

Net Increase (Decrease) in Members' Equity Resulting from Operations

 

$

5,875

 

 

$

(25,422

)

 

Loan Origination and Structuring Fees

 

If the loan origination and structuring fees earned by Sebago Lake during a fiscal year exceed Sebago Lake’s expenses and other obligations (excluding financing costs), such excess is allocated to the Member(s) responsible for the origination of the loans pro rata in accordance with the total loan origination and structuring fees earned by Sebago Lake with respect to the loans originated by such Member; provided, that in no event will the amount allocated to a Member exceed 1% of the par value of the loans originated by such Member in any fiscal year. The loan origination and structuring fee is accrued quarterly and included in other income from controlled, affiliated investments on the Company’s Consolidated Statements of Operations and paid annually. On February 27, 2019, the Members agreed to amend the terms of Sebago Lake’s operating agreement to eliminate the allocation of excess loan origination and structuring fees to the Members. As such, for the three months ended March 31, 2021 and 2020, the Company accrued no income based on loan origination and structuring fees.

51


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Note 5. Fair Value of Investments

Investments

The following tables present the fair value hierarchy of investments as of March 31, 2021 and December 31, 2020:

 

 

 

Fair Value Hierarchy as of March 31, 2021

 

($ in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

First-lien senior secured debt investments

 

$

 

 

$

1,638

 

 

$

8,742,831

 

 

$

8,744,469

 

Second-lien senior secured debt investments

 

 

 

 

 

 

 

 

1,807,521

 

 

 

1,807,521

 

Unsecured debt investments

 

 

 

 

 

 

 

 

191,211

 

 

 

191,211

 

Equity investments(1)

 

 

16,828

 

 

 

 

 

 

372,327

 

 

 

389,155

 

Subtotal

 

$

16,828

 

 

$

1,638

 

 

$

11,113,890

 

 

$

11,132,356

 

Investments measured at NAV(2)

 

 

 

 

 

 

 

 

 

 

 

108,116

 

Total Investments at fair value

 

$

16,828

 

 

$

1,638

 

 

$

11,113,890

 

 

$

11,240,472

 

________________

 

(1)

Includes equity investment in Wingspire.

 

(2)

Includes equity investment in Sebago Lake.

 

 

 

 

Fair Value Hierarchy as of December 31, 2020

 

($ in thousands)

 

Level 1

 

 

Level 2

 

 

Level 3

 

 

Total

 

First-lien senior secured debt investments

 

$

 

 

$

15,268

 

 

$

8,389,486

 

 

$

8,404,754

 

Second-lien senior secured debt investments

 

 

 

 

 

50,768

 

 

 

1,949,703

 

 

 

2,000,471

 

Unsecured debt investments

 

 

 

 

 

 

 

 

59,562

 

 

 

59,562

 

Equity investments(1)

 

 

 

 

 

19,275

 

 

 

252,464

 

 

 

271,739

 

Subtotal

 

$

 

 

$

85,311

 

 

$

10,651,215

 

 

$

10,736,526

 

Investments measured at NAV(2)

 

 

 

 

 

 

 

 

 

 

 

105,546

 

Total Investments at fair value

 

$

 

 

$

85,311

 

 

$

10,651,215

 

 

$

10,842,072

 

________________

 

(1)

Includes equity investment in Wingspire.

 

(2)

Includes equity investment in Sebago Lake.

 

52


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

The following tables present changes in the fair value of investments for which Level 3 inputs were used to determine the fair value as of and for the three months ended March 31, 2021 and 2020:

 

 

 

As of and for the Three Months Ended March 31, 2021

 

($ in thousands)

 

First-lien senior secured debt investments

 

 

Second-lien senior secured debt investments

 

 

Unsecured debt investments

 

 

Equity investments

 

 

Total

 

Fair value, beginning of period

 

$

8,389,486

 

 

$

1,949,703

 

 

$

59,562

 

 

$

252,464

 

 

$

10,651,215

 

Purchases of investments, net

 

 

677,162

 

 

 

34,773

 

 

 

130,137

 

 

 

108,568

 

 

 

950,640

 

Payment-in-kind

 

 

12,377

 

 

 

 

 

 

2,292

 

 

 

1,019

 

 

 

15,688

 

Proceeds from investments, net

 

 

(388,111

)

 

 

(185,921

)

 

 

 

 

 

 

 

 

(574,032

)

Net change in unrealized gain (loss)

 

 

41,585

 

 

 

5,641

 

 

 

(813

)

 

 

10,253

 

 

 

56,666

 

Net realized gains (losses)

 

 

445

 

 

 

85

 

 

 

 

 

 

 

 

 

530

 

Net amortization of discount on investments

 

 

9,040

 

 

 

3,240

 

 

 

33

 

 

 

23

 

 

 

12,336

 

Transfers into (out of) Level 3(1)

 

 

847

 

 

 

 

 

 

 

 

 

 

 

 

847

 

Fair value, end of period

 

$

8,742,831

 

 

$

1,807,521

 

 

$

191,211

 

 

$

372,327

 

 

$

11,113,890

 

________________

 

(1)

Transfers between levels, if any, are recognized at the beginning of the quarter in which the transfers occur.

 

 

 

 

As of and for the Three Months Ended March 31, 2020

 

($ in thousands)

 

First-lien senior secured debt investments

 

 

Second-lien senior secured debt investments

 

 

Equity investments

 

 

Total

 

Fair value, beginning of period

 

$

6,976,014

 

 

$

1,544,457

 

 

$

12,875

 

 

$

8,533,346

 

Purchases of investments, net(1)

 

 

789,943

 

 

 

109,821

 

 

 

112,603

 

 

 

1,012,367

 

Proceeds from investments, net

 

 

(312,938

)

 

 

(34,800

)

 

 

 

 

 

(347,738

)

Net change in unrealized gain (loss)

 

 

(332,094

)

 

 

(98,598

)

 

 

(8,197

)

 

 

(438,889

)

Net realized gains (losses)

 

 

342

 

 

 

 

 

 

 

 

 

342

 

Net amortization of discount on investments

 

 

8,365

 

 

 

1,251

 

 

 

 

 

 

9,616

 

Transfers into (out of) Level 3(2)

 

 

23,384

 

 

 

 

 

 

 

 

 

23,384

 

Fair value, end of period

 

$

7,153,016

 

 

$

1,522,131

 

 

$

117,281

 

 

$

8,792,428

 

________________

 

(1)

Purchases may include PIK.

 

(2)

Transfers between levels, if any, are recognized at the beginning of the quarter in which the transfers occur.

 

 

The following tables present information with respect to net change in unrealized gains on investments for which Level 3 inputs were used in determining the fair value that are still held by the Company for the three months ended March 31, 2021 and 2020:

 

($ in thousands)

 

Net change in unrealized gain (loss) for the Three Months Ended March 31, 2021 on Investments Held at March 31, 2021

 

 

Net change in unrealized gain (loss) for the Three Months Ended March 31, 2020 on Investments Held at March 31, 2020

 

First-lien senior secured debt investments

 

$

45,046

 

 

$

(332,678

)

Second-lien senior secured debt investments

 

 

6,586

 

 

 

(98,525

)

Unsecured debt investments

 

 

(813

)

 

 

 

Equity investments

 

 

10,253

 

 

 

(8,197

)

Total Investments

 

$

61,072

 

 

$

(439,400

)

53


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

 

The following tables present quantitative information about the significant unobservable inputs of the Company’s Level 3 investments as of March 31, 2021 and December 31, 2020. The weighted average range of unobservable inputs is based on fair value of investments. The tables are not intended to be all-inclusive but instead capture the significant unobservable inputs relevant to the Company’s determination of fair value.

 

 

As of March 31, 2021

($ in thousands)

 

Fair Value

 

 

Valuation Technique

 

Unobservable Input

 

Range (Weighted Average)

 

Impact to Valuation from an Increase in Input

First-lien senior secured debt investments

 

$

8,294,048

 

 

Yield Analysis

 

Market Yield

 

3.3%-19.2% (8.8%)

 

Decrease

 

 

 

448,783

 

 

Recent Transaction

 

Transaction Price

 

97.5% - 99.0% (98.5%)

 

Increase

Second-lien senior secured debt investments(1)

 

$

1,757,663

 

 

Yield Analysis

 

Market Yield

 

6.8%-21.6% (10.0%)

 

Decrease

 

 

 

25,153

 

 

Collateral Analysis

 

Recovery Rate

 

39.5% - 39.5% (39.5%)

 

Increase

Unsecured debt investments(2)

 

$

51,149

 

 

Yield Analysis

 

Market Yield

 

6.5% - 8.3% (6.7%)

 

Decrease

 

 

 

129,433

 

 

Recent Transaction

 

Transaction Price

 

98.8% - 98.8% (98.8%)

 

Increase

Equity Investments

 

$

173,072

 

 

Market Approach

 

EBITDA Multiple

 

3.7x - 16.0x (7.1x)

 

Increase

 

 

 

23,054

 

 

Yield Analysis

 

Market Yield

 

14.6% - 14.6% (14.6%)

 

Decrease

 

 

 

176,201

 

 

Recent Transaction

 

Transaction Price

 

1.0 - 1.0 (1.0)

 

Increase

________________

 

(1)

Excludes Level 3 investments with an aggregate fair value amounting to $24,705, which the Company valued using indicative bid prices obtained from brokers.

 

(2)

Excludes Level 3 investments with an aggregate fair value amounting to $10,629, which the Company valued using indicative bid prices obtained from brokers.

 

54


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

 

 

As of December 31, 2020

($ in thousands)

 

Fair Value

 

 

Valuation Technique

 

Unobservable Input

 

Range (Weighted Average)

 

Impact to Valuation from an Increase in Input

First-lien senior secured debt investments

 

$

7,542,232

 

 

Yield Analysis

 

Market Yield

 

4.9%-20.6% (9.1%)

 

Decrease

 

 

 

847,254

 

 

Recent Transaction

 

Transaction Price

 

96.0% - 99.0% (98.5%)

 

Increase

Second-lien senior secured debt investments(1)

 

$

1,638,587

 

 

Yield Analysis

 

Market Yield

 

5.2%-19.5% (10.3%)

 

Decrease

 

 

 

253,705

 

 

Recent Transaction

 

Transaction Price

 

97.5% - 99.5% (98.1%)

 

Increase

 

 

 

32,563

 

 

Collateral Analysis

 

Recovery Rate

 

24.0% - 24.0% (24.0%)

 

Increase

Unsecured debt investments

 

$

54,450

 

 

Yield Analysis

 

Market Yield

 

8.1% - 9.3% (8.3%)

 

Decrease

 

 

 

5,112

 

 

Recent Transaction

 

Transaction Price

 

98.5% - 98.5% (98.5%)

 

Increase

Equity Investments

 

$

132,044

 

 

Market Approach

 

EBITDA Multiple

 

3.7x - 11.8x (5.4x)

 

Increase

 

 

 

120,420

 

 

Recent Transaction

 

Transaction Price

 

0.97 - 1.0 (0.99)

 

Increase

________________

 

(1)

Excludes investments with an aggregate fair value amounting to $24,848, which the Company valued using indicative bid prices obtained from brokers.

 

The Company typically determines the fair value of its performing Level 3 debt investments utilizing a yield analysis. In a yield analysis, a price is ascribed for each investment based upon an assessment of current and expected market yields for similar investments and risk profiles. Additional consideration is given to the expected life, portfolio company performance since close, and other terms and risks associated with an investment. Among other factors, a determinant of risk is the amount of leverage used by the portfolio company relative to its total enterprise value, and the rights and remedies of the Company’s investment within the portfolio company’s capital structure.

Significant unobservable quantitative inputs typically used in the fair value measurement of the Company’s Level 3 debt investments primarily include current market yields, including relevant market indices, but may also include quotes from brokers, dealers, and pricing services as indicated by comparable investments. For the Company’s Level 3 equity investments, a market approach, based on comparable publicly-traded company and comparable market transaction multiples of revenues, earnings before income taxes, depreciation and amortization (“EBITDA”) or some combination thereof and comparable market transactions typically would be used.

55


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Debt Not Carried at Fair Value        

Fair value is estimated by discounting remaining payments using applicable current market rates, which take into account changes in the Company’s marketplace credit ratings, or market quotes, if available. The following table presents the carrying and fair values of the Company’s debt obligations as of ended March 31, 2021 and December 31, 2020.

 

 

 

March 31, 2021

 

 

December 31, 2020

 

($ in thousands)

 

Net Carrying

Value(1)

 

 

Fair Value

 

 

Net Carrying

Value(2)

 

 

Fair Value

 

Revolving Credit Facility

 

$

544,193

 

 

$

544,193

 

 

$

243,143

 

 

$

243,143

 

SPV Asset Facility II

 

 

95,829

 

 

 

95,829

 

 

 

95,654

 

 

 

95,654

 

SPV Asset Facility III

 

 

373,650

 

 

 

373,650

 

 

 

373,238

 

 

 

373,238

 

SPV Asset Facility IV

 

 

246,738

 

 

 

246,738

 

 

 

291,644

 

 

 

291,644

 

CLO I

 

 

386,780

 

 

 

386,780

 

 

 

386,708

 

 

 

386,708

 

CLO II

 

 

257,741

 

 

 

257,741

 

 

 

257,686

 

 

 

257,686

 

CLO III

 

 

257,791

 

 

 

257,791

 

 

 

257,744

 

 

 

257,744

 

CLO IV

 

 

247,852

 

 

 

247,852

 

 

 

247,745

 

 

 

247,745

 

CLO V

 

 

194,014

 

 

 

194,014

 

 

 

194,128

 

 

 

194,128

 

2023 Notes

 

 

151,236

 

 

 

158,250

 

 

 

151,889

 

 

 

157,125

 

2024 Notes

 

 

413,919

 

 

 

436,000

 

 

 

418,372

 

 

 

433,000

 

2025 Notes

 

 

418,519

 

 

 

447,313

 

 

 

418,154

 

 

 

443,063

 

July 2025 Notes

 

 

492,495

 

 

 

520,000

 

 

 

492,095

 

 

 

520,000

 

2026 Notes

 

 

489,662

 

 

 

525,000

 

 

 

489,176

 

 

 

526,250

 

July 2026 Notes

 

 

975,472

 

 

 

1,012,500

 

 

 

975,346

 

 

 

1,012,500

 

Total Debt

 

$

5,545,891

 

 

$

5,703,651

 

 

$

5,292,722

 

 

$

5,439,628

 

________________

 

(1)

The carrying value of the Company’s Revolving Credit Facility, SPV Asset Facility II, SPV Asset Facility III, SPV Asset Facility IV, CLO I, CLO II, CLO III, CLO IV, CLO V, 2023 Notes, 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026 Notes are presented net of deferred financing costs of $9.3 million, $4.2 million, $1.4 million, $3.3 million, $3.2 million, $2.3 million, $2.2 million, $4.1 million, $2.0 million, $0.9 million, $6.5 million, $6.5 million, $7.5 million, $10.3 million and $24.5 million, respectively.

 

(2)

The carrying value of the Company’s Revolving Credit Facility, SPV Asset Facility II, SPV Asset Facility III, SPV Asset Facility IV, CLO I, CLO II, CLO III, CLO IV, CLO V, 2023 Notes, 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026 Notes are presented net of deferred financing costs of $9.4 million, $4.2 million, $1.8 million, $3.4 million, $3.3 million, $2.3 million, $2.3 million, $4.3 million, $1.9 million, $1.0 million, $7.0 million, $6.8 million, $7.9 million, $10.8 million, $24.7 million respectively.

 

The following table presents fair value measurements of the Company’s debt obligations as of March 31, 2021 and December 31, 2020:

 

 

 

 

 

($ in thousands)

 

March 31, 2021

 

 

December 31, 2020

 

Level 1

 

$

 

 

$

 

Level 2

 

 

2,940,813

 

 

 

2,934,813

 

Level 3

 

 

2,762,838

 

 

 

2,504,816

 

Total Debt

 

$

5,703,651

 

 

$

5,439,628

 

 

Financial Instruments Not Carried at Fair Value

As of March 31, 2021 and December 31, 2020, the carrying amounts of the Company’s assets and liabilities, other than investments at fair value and debt, approximate fair value due to their short maturities.

56


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Note 6. Debt

In accordance with the 1940 Act, with certain limitations, the Company is allowed to borrow amounts such that its asset coverage, as defined in the 1940 Act, is at least 150%. As of March 31, 2021 and December 31, 2020, the Company’s asset coverage was 202% and 206%, respectively.

Debt obligations consisted of the following as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

($ in thousands)

 

Aggregate Principal Committed

 

 

Outstanding Principal

 

 

Amount Available(1)

 

 

Net Carrying Value(2)

 

Revolving Credit Facility(3)(5)

 

$

1,455,000

 

 

$

553,461

 

 

$

870,258

 

 

$

544,193

 

SPV Asset Facility II

 

 

350,000

 

 

 

100,000

 

 

 

250,000

 

 

 

95,829

 

SPV Asset Facility III

 

 

500,000

 

 

 

375,000

 

 

 

125,000

 

 

 

373,650

 

SPV Asset Facility IV

 

 

450,000

 

 

 

250,000

 

 

 

200,000

 

 

 

246,738

 

CLO I

 

 

390,000

 

 

 

390,000

 

 

 

 

 

 

386,780

 

CLO II

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,741

 

CLO III

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,791

 

CLO IV

 

 

252,000

 

 

 

252,000

 

 

 

 

 

 

247,852

 

CLO V

 

 

196,000

 

 

 

196,000

 

 

 

 

 

 

194,014

 

2023 Notes(4)

 

 

150,000

 

 

 

150,000

 

 

 

 

 

 

151,236

 

2024 Notes(4)

 

 

400,000

 

 

 

400,000

 

 

 

 

 

 

413,919

 

2025 Notes

 

 

425,000

 

 

 

425,000

 

 

 

 

 

 

418,519

 

July 2025 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

492,495

 

2026 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

489,662

 

July 2026 Notes

 

 

1,000,000

 

 

 

1,000,000

 

 

 

 

 

 

975,472

 

Total Debt

 

$

7,088,000

 

 

$

5,611,461

 

 

$

1,445,258

 

 

$

5,545,891

 

________________

 

(1)

The amount available reflects any limitations related to each credit facility’s borrowing base.

 

(2)

The carrying value of the Company’s Revolving Credit Facility, SPV Asset Facility II, SPV Asset Facility III, SPV Asset Facility IV, CLO I, CLO II, CLO III, CLO IV, CLO V, 2023 Notes, 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026 Notes are presented net of deferred financing costs of $9.3 million, $4.2 million, $1.4 million, $3.3 million, $3.2 million, $2.3 million, $2.2 million, $4.1 million, $2.0 million, $0.9 million, $6.5 million, $6.5 million, $7.5 million, $10.3 million and $24.5 million, respectively.

 

(3)

Includes the unrealized translation gain (loss) on borrowings denominated in foreign currencies.

 

(4)

Inclusive of change in fair market value of effective hedge.

 

(5)

The amount available is reduced by $31.3 million of outstanding letters of credit.  

57


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

 

 

 

December 31, 2020

 

($ in thousands)

 

Aggregate Principal Committed

 

 

Outstanding Principal

 

 

Amount Available(1)

 

 

Net Carrying Value(2)

 

Revolving Credit Facility(3)(5)

 

$

1,355,000

 

 

$

252,525

 

 

$

1,075,636

 

 

$

243,143

 

SPV Asset Facility II

 

 

350,000

 

 

 

100,000

 

 

 

250,000

 

 

 

95,654

 

SPV Asset Facility III

 

 

500,000

 

 

 

375,000

 

 

 

125,000

 

 

 

373,238

 

SPV Asset Facility IV

 

 

450,000

 

 

 

295,000

 

 

 

155,000

 

 

 

291,644

 

CLO I

 

 

390,000

 

 

 

390,000

 

 

 

 

 

 

386,708

 

CLO II

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,686

 

CLO III

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,744

 

CLO IV

 

 

252,000

 

 

 

252,000

 

 

 

 

 

 

247,745

 

CLO V

 

 

196,000

 

 

 

196,000

 

 

 

 

 

 

194,128

 

2023 Notes(4)

 

 

150,000

 

 

 

150,000

 

 

 

 

 

 

151,889

 

2024 Notes(4)

 

 

400,000

 

 

 

400,000

 

 

 

 

 

 

418,372

 

2025 Notes

 

 

425,000

 

 

 

425,000

 

 

 

 

 

 

418,154

 

July 2025 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

492,095

 

2026 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

489,176

 

July 2026 Notes

 

 

1,000,000

 

 

 

1,000,000

 

 

 

 

 

 

975,346

 

Total Debt

 

$

6,988,000

 

 

$

5,355,525

 

 

$

1,605,636

 

 

$

5,292,722

 

________________

 

(1)

The amount available reflects any limitations related to each credit facility’s borrowing base.

 

(2)

The carrying value of the Company’s Revolving Credit Facility, SPV Asset Facility II, SPV Asset Facility III, SPV Asset Facility IV, CLO I, CLO II, CLO III, CLO IV, CLO V, 2023 Notes, 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026 Notes are presented net of deferred financing costs of $9.4 million, $4.2 million, $1.8 million, $3.4 million, $3.3 million, $2.3 million, $2.3 million, $4.3 million, $1.9 million, $1.0 million, $7.0 million, $6.8 million, $7.9 million, $10.8 million, $24.7 million respectively.

 

(3)

Includes the unrealized translation gain (loss) on borrowings denominated in foreign currencies.

 

(4)

Inclusive of change in fair market value of effective hedge.

 

(5)

The amount available is reduced by $26.8 million of outstanding letters of credit.

 

For the three months ended March 31, 2021 and 2020, the components of interest expense were as follows:

 

 

 

For the Three Months Ended March 31,

($ in thousands)

 

2021

 

 

2020

 

 

Interest expense

 

$

43,138

 

 

$

33,582

 

 

Amortization of debt issuance costs

 

 

4,946

 

 

 

3,170

 

 

Net change in unrealized gain (loss) on effective

     interest rate swaps and hedged items(1)

 

 

(8

)

 

 

(2,795

)

 

Total Interest Expense

 

$

48,076

 

 

$

33,957

 

 

Average interest rate

 

 

3.2

 

%

 

4.2

 

%

Average daily borrowings

 

$

5,330,364

 

 

$

3,184,613

 

 

________________

 

(1)

Refer to the 2023 Notes and 2024 Notes for details on each facility’s interest rate swap.

 

58


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Credit Facilities

Our credit facilities contain customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events, and customary events of default (with customary cure and notice provisions).

 

Description of Facilities

Revolving Credit Facility

On February 1, 2017, the Company entered into a senior secured revolving credit agreement (and as amended by that certain First Amendment to Senior Secured Revolving Credit Agreement, dated as of July 17, 2017, the First Omnibus Amendment to Senior Secured Revolving Credit Agreement and Guarantee and Security Agreement, dated as of March 29, 2018, the Third Amendment to Senior Secured Revolving Credit Agreement, dated as of June 21, 2018, the Fourth Amendment to Senior Secured Revolving Credit Agreement, dated as of April 2, 2019, the Fifth Amendment to Senior Secured Revolving Credit Agreement, dated as of May 7, 2020 and the Sixth Amendment to Senior Secured Revolving Credit Agreement, dated as of September 3, 2020, the “Revolving Credit Facility”). The parties to the Revolving Credit Facility include the Company, as Borrower, the lenders from time to time parties thereto (each a “Lender” and collectively, the “Lenders”) and Truist Securities, Inc. and ING Capital LLC as Joint Lead Arrangers and Joint Book Runners, Truist Bank (as successor by merger to SunTrust Bank) as Administrative Agent and ING Capital LLC as Syndication Agent.

The Revolving Credit Facility is guaranteed by OR Lending LLC, a subsidiary of the Company, and will be guaranteed by certain domestic subsidiaries of the Company that are formed or acquired by the Company in the future (collectively, the “Guarantors”). Proceeds of the Revolving Credit Facility may be used for general corporate purposes, including the funding of portfolio investments.

The maximum principal amount of the Revolving Credit Facility is $1.46 billion, subject to availability under the borrowing base, which is based on the Company’s portfolio investments and other outstanding indebtedness. As amended on September 3, 2020, maximum capacity under the Revolving Credit Facility may be increased to $2.0 billion through the Company’s exercise of an uncommitted accordion feature through which existing and new lenders may, at their option, agree to provide additional financing. The Revolving Credit Facility includes a $50 million limit for swingline loans and is secured by a perfected first-priority interest in substantially all of the portfolio investments held by the Company and each Guarantor, subject to certain exceptions.

The availability period under the Revolving Credit Facility will terminate on September 3, 2024, with respect to $1.295 billion of commitments, and on March 31, 2023, with respect to the remaining commitments (together, the “Revolving Credit Facility Commitment Termination Date”). The Revolving Credit Facility will mature on September 3, 2025, with respect to $1.295 billion of commitments, and on April 2, 2024, with respect to the remaining commitments (together, the “Revolving Credit Facility Maturity Date”). During the period from the earliest Revolving Credit Facility Commitment Termination Date to the final Revolving Credit Facility Maturity Date, the Company will be obligated to make mandatory prepayments under the Revolving Credit Facility out of the proceeds of certain asset sales and other recovery events and equity and debt issuances.

The Company may borrow amounts in U.S. dollars or certain other permitted currencies. Amounts drawn under the Revolving Credit Facility will bear interest at either LIBOR plus 2.00%, or the prime rate plus 1.00%. The Company may elect either the LIBOR or prime rate at the time of drawdown, and loans may be converted from one rate to another at any time at the Company’s option, subject to certain conditions. The Company predominantly borrows utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. The Company also pays a fee of 0.375% on undrawn amounts under the Revolving Credit Facility.

The Revolving Credit Facility includes customary covenants, including certain limitations on the incurrence by the Company of additional indebtedness and on the Company’s ability to make distributions to the Company’s shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events and certain financial covenants related to asset coverage and liquidity and other maintenance covenants, as well as customary events of default. The agreement requires a minimum asset coverage ratio of 150% with respect to the Company’s consolidated assets and its subsidiaries, measured at the last day of any fiscal quarter and a minimum asset coverage ratio of no less than 200% with respect to its consolidated assets and its subsidiary guarantors (including certain limitations on the contribution of equity in financing subsidiaries as specified therein) to its secured debt and its subsidiary guarantors (the “Obligor Asset Coverage Ratio”), measured at the last day of each fiscal quarter. The agreement also includes concentration limits in connection with the calculation of the borrowing base, based upon the Obligor Asset Coverage Ratio.

59


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Subscription Credit Facility

On August 1, 2016, the Company entered into a subscription credit facility (as amended, the “Subscription Credit Facility”) with Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent (the “Administrative Agent”) and letter of credit issuer, and Wells Fargo, State Street Bank and Trust Company and the banks and financial institutions from time to time party thereto, as lenders.  

The Subscription Credit Facility permitted the Company to borrow up to $900 million, subject to availability under the “Borrowing Base.” The Borrowing Base was calculated based on the unused Capital Commitments of the investors meeting various eligibility requirements above certain concentration limits based on investors’ credit ratings.  Effective June 19, 2019, the outstanding balance on the Subscription Credit Facility was paid in full and the facility was terminated pursuant to its terms.

Borrowings under the Subscription Credit Facility bore interest, at the Company’s election at the time of drawdown, at a rate per annum equal to (i) in the case of LIBOR rate loans, an adjusted LIBOR rate for the applicable interest period plus 1.60% or (ii) in the case of reference rate loans, the greatest of (A) a prime rate plus 0.60%, (B) the federal funds rate plus 1.10%, and (C) one-month LIBOR plus 1.60%.  Loans were able to be converted from one rate to another at any time at the Company’s election, subject to certain conditions.  The Company predominantly borrowed utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. The Company also paid an unused commitment fee of 0.25% per annum on the unused commitments.

SPV Asset Facilities

SPV Asset Facility I

On December 21, 2017 (the “SPV Asset Facility I Closing Date”), ORCC Financing LLC (“ORCC Financing”), a Delaware limited liability company and subsidiary of the Company, entered into a Loan and Servicing Agreement (as amended, the “SPV Asset Facility I”), with ORCC Financing as Borrower, the Company as Transferor and Servicer, the lenders from time to time parties thereto (the “SPV Lenders”), Morgan Stanley Asset Funding Inc. as Administrative Agent, State Street Bank and Trust Company as Collateral Agent and Cortland Capital Market Services LLC as Collateral Custodian.

From time to time, the Company sold and contributed certain investments to ORCC Financing pursuant to a Sale and Contribution Agreement by and between the Company and ORCC Financing. No gain or loss was recognized as a result of the contribution. Proceeds from the SPV Asset Facility I were used to finance the origination and acquisition of eligible assets by ORCC Financing, including the purchase of such assets from the Company. The Company retained a residual interest in assets contributed to or acquired by ORCC Financing through its ownership of ORCC Financing. The maximum principal amount of the SPV Asset Facility I was $400 million; the availability of this amount was subject to a borrowing base test, which was based on the value of ORCC Financing’s assets from time to time, and satisfaction of certain conditions, including certain concentration limits.

The SPV Asset Facility I provided for the ability to draw and redraw amounts under the SPV Asset Facility I for a period of up to three years after the SPV Asset Facility I Closing Date (the “SPV Asset Facility I Commitment Termination Date”). The SPV Asset Facility I was terminated on June 2, 2020 (the “SPV Asset Facility I Termination Date”). Prior to the SPV Asset Facility I Termination Date, proceeds received by ORCC Financing from principal and interest, dividends, or fees on assets were required to be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to the Company, subject to certain conditions. On the SPV Asset Facility I Termination Date, ORCC Financing repaid in full all outstanding fees and expenses and all principal and interest on outstanding borrowings.

Amounts drawn bore interest at LIBOR plus a spread of 2.25% until the six-month anniversary of the SPV Asset Facility I Closing Date, increasing to 2.50% thereafter, until the SPV Asset Facility I Commitment Termination Date. The Company predominantly borrowed utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. After a ramp-up period, there was an unused fee of 0.75% per annum on the amount, if any, by which the undrawn amount under the SPV Asset Facility I exceeded 25% of the maximum principal amount of the SPV Asset Facility I. The SPV Asset Facility I contained customary covenants, including certain financial maintenance covenants, limitations on the activities of ORCC Financing, including limitations on incurrence of incremental indebtedness, and customary events of default. The SPV Asset Facility I was secured by a perfected first priority security interest in the assets of ORCC Financing and on any payments received by ORCC Financing in respect of those assets. Assets pledged to the SPV Lenders were not available to pay the debts of the Company.

SPV Asset Facility II

On May 22, 2018, ORCC Financing II LLC (“ORCC Financing II”), a Delaware limited liability company and subsidiary of the Company, entered into a Credit Agreement (as amended, the “SPV Asset Facility II”), with ORCC Financing II, as Borrower, the lenders from time to time parties thereto (the “SPV Asset Facility II Lenders”), Natixis, New York Branch, as Administrative Agent, State Street Bank and Trust Company, as Collateral Agent, and Cortland Capital Market Services LLC as Document Custodian. The

60


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

parties to the SPV Asset Facility II have entered into various amendments, including to admit new lenders, increase or decrease the maximum principal amount available under the facility, extend the availability period and maturity date, change the interest rate and make various other changes.  The following describes the terms of SPV Asset Facility II amended through March 17, 2020 (the “SPV Asset Facility II Fifth Amendment Date”).

From time to time, the Company sells and contributes certain investments to ORCC Financing II pursuant to a sale and contribution agreement by and between the Company and ORCC Financing II. No gain or loss will be recognized as a result of the contribution. Proceeds from the SPV Asset Facility II will be used to finance the origination and acquisition of eligible assets by ORCC Financing II, including the purchase of such assets from the Company. The Company retains a residual interest in assets contributed to or acquired by ORCC Financing II through the Company’s ownership of ORCC Financing II. The maximum principal amount of the SPV Asset Facility II following the SPV Asset Facility II Fifth Amendment Date is $350 million (which includes terms loans of $100 million and revolving commitments of $250 million). The availability of this amount is subject to an overcollateralization ratio test, which is based on the value of ORCC Financing II’s assets from time to time, and satisfaction of certain conditions, including an interest coverage ratio test, certain concentration limits and collateral quality tests.

The SPV Asset Facility II provides for the ability to (1) draw term loans and (2) draw and redraw revolving loans under the SPV Asset Facility II for a period of up to 18 months after the SPV Asset Facility II Fifth Amendment Date unless the revolving commitments are terminated or converted to term loans sooner as provided in the SPV Asset Facility II (the “SPV Asset Facility II Commitment Termination Date”). Unless otherwise terminated, the SPV Asset Facility II will mature on May 22, 2028 (the “SPV Asset Facility II Stated Maturity”). Prior to the SPV Asset Facility II Stated Maturity, proceeds received by ORCC Financing II from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to the Company, subject to certain conditions. On the SPV Asset Facility II Stated Maturity, ORCC Financing II must pay in full all outstanding fees and expenses and all principal and interest on outstanding borrowings, and the excess may be returned to the Company.

With respect to revolving loans, amounts drawn bear interest at LIBOR (or, in the case of certain lenders that are commercial paper conduits, the lower of their cost of funds and LIBOR plus 0.25%) plus a spread that steps up from 2.20% to 2.50% during the period from the SPV Asset Facility II Fifth Amendment Date to the six month anniversary of the Reinvestment Period End Date. With respect to term loans, amounts drawn bear interest at LIBOR (or, in the case of certain lenders that are commercial paper conduits, the lower of their cost of funds and LIBOR plus 0.25%)  plus a spread that steps up from 2.25% to 2.55% during the same period. The Company predominantly borrows utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. From the SPV Asset Facility II Fifth Amendment Date to the SPV Asset Facility II Commitment Termination Date, there is a commitment fee ranging from 0.50% to 0.75% per annum on the undrawn amount, if any, of the revolving commitments in the SPV Asset Facility II. The SPV Asset Facility II contains customary covenants, including certain financial maintenance covenants, limitations on the activities of ORCC Financing II, including limitations on incurrence of incremental indebtedness, and customary events of default. The SPV Asset Facility II is secured by a perfected first priority security interest in the assets of ORCC Financing II and on any payments received by ORCC Financing II in respect of those assets. Assets pledged to the SPV Asset Facility II Lenders will not be available to pay the debts of the Company.

SPV Asset Facility III

On December 14, 2018 (the “SPV Asset Facility III Closing Date”), ORCC Financing III LLC (“ORCC Financing III”), a Delaware limited liability company and newly formed subsidiary of the Company, entered into a Loan Financing and Servicing Agreement (the “SPV Asset Facility III”), with ORCC Financing III, as borrower, the Company, as equityholder and services provider, the lenders from time to time parties thereto (the “SPV Lenders III”), Deutsche Bank AG, New York Branch, as Facility Agent, State Street Bank and Trust Company, as Collateral Agent and Cortland Capital Market Services LLC, as Collateral Custodian. The parties to the SPV Asset Facility III have entered into various amendments, including those relating to the undrawn fee and make-whole fee and definition of “Change of Control.” The following describes the terms of SPV Asset Facility III as amended through March 17, 2021.

From time to time, the Company expects to sell and contribute certain loan assets to ORCC Financing III pursuant to a Sale and Contribution Agreement by and between the Company and ORCC Financing III.  No gain or loss will be recognized as a result of the contribution.  Proceeds from the SPV Asset Facility III will be used to finance the origination and acquisition of eligible assets by ORCC Financing III, including the purchase of such assets from the Company.  The Company retains a residual interest in assets contributed to or acquired by ORCC Financing III through its ownership of ORCC Financing III.  The maximum principal amount of the SPV Asset Facility III is $500 million; the availability of this amount is subject to a borrowing base test, which is based on the value of ORCC Financing III’s assets from time to time, and satisfaction of certain conditions, including interest spread and weighted average coupon tests, certain concentration limits and collateral quality tests.

61


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

The SPV Asset Facility III provides for the ability to borrow, reborrow, repay and prepay advances under the SPV Asset Facility III for a period of up to three years after the SPV Asset Facility III Closing Date unless such period is extended or accelerated under the terms of the SPV Asset Facility III (the “SPV Asset Facility III Revolving Period”).  Unless otherwise extended, accelerated or terminated under the terms of the SPV Asset Facility III, the SPV Asset Facility III will mature on the date that is two years after the last day of the SPV Asset Facility III Revolving Period (the “SPV Asset Facility III Stated Maturity”).  Prior to the SPV Asset Facility III Stated Maturity, proceeds received by ORCC Financing III from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding advances, and the excess may be returned to the Company, subject to certain conditions.  On the SPV Asset Facility III Stated Maturity, ORCC Financing III must pay in full all outstanding fees and expenses and all principal and interest on outstanding advances, and the excess may be returned to the Company.

Amounts drawn bear interest at LIBOR (or, in the case of certain SPV Lenders III that are commercial paper conduits, the lower of (a) their cost of funds and (b) LIBOR, such LIBOR not to be lower than zero) plus a spread equal to 2.20% per annum, which spread will increase (a) on and after the end of the SPV Asset Facility III Revolving Period by 0.15% per annum if no event of default has occurred and (b) by 2.00% per annum upon the occurrence of an event of default (such spread, the “Applicable Margin”).  LIBOR may be replaced as a base rate under certain circumstances. The Company predominantly borrows utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. During the Revolving Period, ORCC Financing III will pay an undrawn fee ranging from 0.25% to 0.50% per annum on the undrawn amount, if any, of the revolving commitments in the SPV Asset Facility III.  During the Revolving Period, if the undrawn commitments are in excess of a certain portion (initially 20% and increasing in stages to 75%) of the total commitments under the SPV Asset Facility III, ORCC Financing III will also pay a make-whole fee equal to the Applicable Margin multiplied by such excess undrawn commitment amount, reduced by the undrawn fee payable on such excess.  The SPV Asset Facility III contains customary covenants, including certain financial maintenance covenants, limitations on the activities of ORCC Financing III, including limitations on incurrence of incremental indebtedness, and customary events of default.  The SPV Asset Facility III is secured by a perfected first priority security interest in the assets of ORCC Financing III and on any payments received by ORCC Financing III in respect of those assets.  Assets pledged to the SPV Asset Facility III Lenders will not be available to pay the debts of the Company.

SPV Asset Facility IV

On August 2, 2019 (the “SPV Asset Facility IV Closing Date”), ORCC Financing IV LLC (“ORCC Financing IV”), a Delaware limited liability company and newly formed subsidiary of the Company entered into a Credit Agreement (the “SPV Asset Facility IV”), with ORCC Financing IV, as borrower, Société Générale, as initial Lender and as Administrative Agent, State Street Bank and Trust Company, as Collateral Agent, Collateral Administrator and Custodian, and Cortland Capital Market Services LLC as Document Custodian and the lenders from time to time party thereto pursuant to Assignment and Assumption Agreements. On November 22, 2019 (the “SPV Asset Facility IV Amendment Date”), the parties to the SPV Asset Facility IV amended the SPV Asset Facility IV to increase the maximum principal amount of the SPV Asset Facility IV to $450 million in periodic increments through March 22, 2020.

From time to time, the Company expects to sell and contribute certain investments to ORCC Financing IV pursuant to a Sale and Contribution Agreement by and between the Company and ORCC Financing IV.  No gain or loss will be recognized as a result of the contribution.  Proceeds from the SPV Asset Facility IV will be used to finance the origination and acquisition of eligible assets by ORCC Financing IV, including the purchase of such assets from the Company.  The Company retains a residual interest in assets contributed to or acquired by ORCC Financing IV through its ownership of ORCC Financing IV.  The maximum principal amount of the Credit Facility is $450 million, subject to a ramp period; the availability of this amount is subject to an overcollateralization ratio test, which is based on the value of ORCC Financing IV’s assets from time to time, and satisfaction of certain conditions, including an interest coverage ratio test, certain concentration limits and collateral quality tests.

The SPV Asset Facility IV provides for the ability to (1) draw term loans and (2) draw and redraw revolving loans under the spv Asset Facility IV for a period of up to two years after the Closing Date unless the revolving commitments are terminated or converted to term loans sooner as provided in the SPV Asset Facility IV (the “Commitment Termination Date”).  Unless otherwise terminated, the SPV Asset Facility IV will mature on August 2, 2029 (the “SPV Asset Facility IV Stated Maturity”).  Prior to the SPV Asset Facility IV Stated Maturity, proceeds received by ORCC Financing IV from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to the Company, subject to certain conditions.  On the SPV Asset Facility IV Stated Maturity, ORCC Financing IV must pay in full all outstanding fees and expenses and all principal and interest on outstanding borrowings, and the excess may be returned to the Company.

Amounts drawn bear interest at LIBOR (or, in the case of certain lenders that are commercial paper conduits, the lower of their cost of funds and LIBOR plus 0.25%) plus a spread ranging from 2.15% to 2.50%. The Company predominantly borrows utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. From the Closing Date to the Commitment Termination Date, there is a commitment fee ranging from 0.50% to 1.00% per annum on the undrawn amount, if any, of the revolving

62


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

commitments in the SPV Asset Facility IV.  The SPV Asset Facility IV contains customary covenants, including certain financial maintenance covenants, limitations on the activities of ORCC Financing IV, including limitations on incurrence of incremental indebtedness, and customary events of default.  The SPV Asset Facility IV is secured by a perfected first priority security interest in the assets of ORCC Financing IV and on any payments received by ORCC Financing IV in respect of those assets.  Assets pledged to the Lenders will not be available to pay the debts of the Company.

CLOs

CLO I

On May 28, 2019 (the “CLO I Closing Date”), the Company completed a $596 million term debt securitization transaction (the “CLO I Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by the Company.  The secured notes and preferred shares issued in the CLO I Transaction and the secured loan borrowed in the CLO I Transaction were issued and incurred, as applicable, by the Company’s consolidated subsidiaries Owl Rock CLO I, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO I Issuer”), and Owl Rock CLO I, LLC, a Delaware limited liability company (the “CLO I Co-Issuer” and together with the CLO I Issuer, the “CLO I Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO I Issuer.    

In the CLO I Transaction the CLO I Issuers (A) issued the following notes pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO I Indenture”), by and among the CLO I Issuers and State Street Bank and Trust Company:  (i) $242 million of AAA(sf) Class A Notes, which bear interest at three-month LIBOR plus 1.80%, (ii) $30 million of AAA(sf) Class A-F Notes, which bear interest at a fixed rate of 4.165%, and (iii) $68 million of AA(sf) Class B Notes, which bear interest at three-month LIBOR plus 2.70% (together, the “CLO I Notes”) and (B) borrowed $50 million under floating rate loans (the “Class A Loans” and together with the CLO I Notes, the “CLO I Debt”), which bear interest at three-month LIBOR plus 1.80%, under a credit agreement (the “CLO I Credit Agreement”), dated as of the CLO I Closing Date, by and among the CLO I Issuers, as borrowers, various financial institutions, as lenders, and State Street Bank and Trust Company, as collateral trustee and loan agent.  The Class A Loans may be exchanged by the lenders for Class A Notes at any time, subject to certain conditions under the CLO I Credit Agreement and the CLO I Indenture.  The CLO I Debt is scheduled to mature on May 20, 2031. The CLO I Notes were privately placed by Natixis Securities Americas, LLC and SG Americas Securities, LLC.

Concurrently with the issuance of the CLO I Notes and the borrowing under the Class A Loans, the CLO I Issuer issued approximately $206.1 million of subordinated securities in the form of 206,106 preferred shares at an issue price of U.S.$1,000 per share (the “CLO I Preferred Shares”).  The CLO I Preferred Shares were issued by the CLO I Issuer as part of its issued share capital and are not secured by the collateral securing the CLO I Debt. The Company owns all of the CLO I Preferred Shares, and as such, these securities are eliminated in consolidation. The Company acts as retention holder in connection with the CLO I Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO I Preferred Shares.

The Adviser serves as collateral manager for the CLO I Issuer under a collateral management agreement dated as of the CLO I Closing Date.  The Adviser is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO I Issuers’ equity or notes owned by the Company.

The CLO I Debt is secured by all of the assets of the CLO I Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO I Transaction, ORCC Financing II LLC and the Company sold and contributed approximately $575 million par amount of middle market loans to the CLO I Issuer on the CLO I Closing Date.  Such loans constituted the initial portfolio assets securing the CLO I Debt.  The Company and ORCC Financing II LLC each made customary representations, warranties, and covenants to the CLO I Issuer regarding such sales and contributions under a loan sale agreement.

Through May 20, 2023, a portion of the proceeds received by the CLO I Issuer from the loans securing the CLO I Debt may be used by the CLO I Issuer to purchase additional middle market loans under the direction of the Adviser as the collateral manager for the CLO I Issuer and in accordance with the Company’s investing strategy and ability to originate eligible middle market loans.

The CLO I Debt is the secured obligation of the CLO I Issuers, and the CLO I Indenture and the CLO I Credit Agreement include customary covenants and events of default.  Assets pledged to holders of the CLO I Debt and the other secured parties under the CLO I Indenture will not be available to pay the debts of the Company.

63


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

The CLO I Notes were offered in reliance on Section 4(a)(2) of the Securities Act. The CLO I Notes have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable.

CLO II

On December 12, 2019 (the “CLO II Closing Date”), the Company completed a $396.6 million term debt securitization transaction (the “CLO II Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by the Company. The secured notes and preferred shares issued in the CLO II Transaction were issued by the Company’s consolidated subsidiaries Owl Rock CLO II, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO II Issuer”), and Owl Rock CLO II, LLC, a Delaware limited liability company (the “CLO II Co-Issuer” and together with the CLO II Issuer, the “CLO II Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO II Issuer.  

The CLO II Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the CLO II Closing Date (the “CLO II Indenture”), by and among the CLO II Issuers and State Street Bank and Trust Company: (i) $157 million of AAA(sf) Class A-1L Notes, which bear interest at three-month LIBOR plus 1.75%, (ii) $40 million of AAA(sf) Class A-1F Notes, which bear interest at a fixed rate of 3.44%, (iii) $20 million of AAA(sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.20%, (iv) $40 million of AA(sf) Class B-L Notes, which bear interest at three-month LIBOR plus 2.75% and (v) $3 million of AA(sf) Class B-F Notes, which bear interest at a fixed rate of 4.46% (together, the “CLO II Debt”). The CLO II Debt was scheduled to mature on January 20, 2031. The CLO II Debt was privately placed by Deutsche Bank Securities Inc.

The CLO II Debt was redeemed in the CLO II Refinancing, described below.

Concurrently with the issuance of the CLO II Debt, the CLO II Issuer issued approximately $136.6 million of subordinated securities in the form of 136,600 preferred shares at an issue price of U.S.$1,000 per share (the “CLO II Preferred Shares”). The CLO II Preferred Shares were issued by the CLO II Issuer as part of its issued share capital and are not secured by the collateral securing the CLO II Debt. The Company owns all of the CLO II Preferred Shares, and as such, these securities are eliminated in consolidation. The Company acted as retention holder in connection with the CLO II Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such was required to retain a portion of the CLO II Preferred Shares.

The Adviser serves as collateral manager for the CLO II Issuer under a collateral management agreement dated as of the CLO II Closing Date.  The Adviser is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO II Issuers’ equity or notes owned by the Company.

The CLO II Debt was secured by all of the assets of the CLO II Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO II Transaction, ORCC Financing III LLC and the Company sold and contributed approximately $400 million par amount of middle market loans to the CLO II Issuer on the CLO II Closing Date.  Such loans constituted the initial portfolio assets securing the CLO II Debt.  The Company and ORCC Financing III LLC each made customary representations, warranties, and covenants to the CLO II Issuer regarding such sales and contributions under a loan sale agreement.

Through January 20, 2022, a portion of the proceeds received by the CLO II Issuer from the loans securing the CLO II Debt could be used by the CLO II Issuer to purchase additional middle market loans under the direction of the Adviser  as the collateral manager for the CLO II Issuer and in accordance with the Company’s investing strategy and ability to originate eligible middle market loans.  

The CLO II Debt was the secured obligation of the CLO II Issuers, and the CLO II Indenture includes customary covenants and events of default.  Assets pledged to holders of the CLO II Debt and the other secured parties under the CLO II Indenture were not available to pay the debts of the Company.

The CLO II Debt was offered in reliance on Section 4(a)(2) of the Securities Act. The CLO II Debt has not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable.

64


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

CLO II Refinancing

On April 9, 2021 (the “CLO II Refinancing Date”), the Company completed a $398.1 million term debt securitization refinancing (the “CLO II Refinancing”), also known as a collateralized loan obligation refinancing, which is a form of secured financing incurred by the Company.  The secured notes and preferred shares issued in the CLO II Refinancing were issued by the CLO II Issuer and the CLO II Co-Issuer and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the Issuer.  

The CLO II Refinancing was executed by the issuance of the following classes of notes pursuant to the CLO II Indenture, as supplemented by the supplemental indenture dated as of the CLO II Refinancing Date (the “CLO II Refinancing Indenture”), by and among the CLO II Issuers and State Street Bank and Trust Company:  (i) $204 million of AAA(sf) Class A-LR Notes, which bear interest at three-month LIBOR plus 1.55%, (ii) $20 million of AAA(sf) Class A-FR Notes, which bear interest at a fixed rate of 2.48% and (iii) $36 million of AA(sf) Class B-R Notes, which bear interest at three-month LIBOR plus 1.90% (together, the “CLO II Refinancing Debt”).  The CLO II Refinancing Debt is secured by the middle market loans, participation interests in middle market loans and other assets of the CLO II Issuer.  The CLO II Refinancing Debt is scheduled to mature on April 20, 2033.  The CLO II Refinancing Debt was privately placed by Deutsche Bank Securities Inc. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO II Refinancing Debt. The proceeds from the CLO II Refinancing were used to redeem in full the classes of notes issued on the CLO II Closing Date.

Concurrently with the issuance of the CLO II Refinancing Debt, the CLO II Issuer issued 1,500 additional shares of CLO II Preferred Shares at an issue price of U.S.$1,000 per share (the “CLO II Refinancing Preferred Shares”) resulting in a total outstanding number of CLO II Preferred Shares of 138,100 ($138.1 million total issue price).  The CLO II Refinancing Preferred Shares were issued by the CLO II Issuer as part of its issued share capital and are not secured by the collateral securing the CLO II Refinancing Debt. The Company purchased all of the CLO II Refinancing Preferred Shares.  The Company acts as retention holder in connection with the CLO II Refinancing for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO II Preferred Shares. The proceeds from the CLO II Refinancing Preferred Shares were used to pay certain expenses incurred in connection with the CLO II Refinancing.

Through April 20, 2025, a portion of the proceeds received by the CLO II Issuer from the loans securing the CLO II Refinancing Debt may be used by the CLO II Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO II Issuer and in accordance with the Company’s investing strategy and ability to originate eligible middle market loans.  

The CLO II Refinancing Debt is the secured obligation of the CLO II Issuers, and the CLO II Refinancing Indenture includes customary covenants and events of default.  The CLO II Refinancing Debt has not been registered under the Securities Act, or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser serves as collateral manager for the CLO II Issuer under a collateral management agreement dated as of the CLO II Closing Date.  The Adviser is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO II Issuers’ equity or notes owned by the Company.

CLO III

On March 26, 2020 (the “CLO III Closing Date”), the Company completed a $395.31 million term debt securitization transaction (the “CLO III Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by the Company.  The secured notes and preferred shares issued in the CLO III Transaction were issued by the Company’s consolidated subsidiaries Owl Rock CLO III, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO III Issuer”), and Owl Rock CLO III, LLC, a Delaware limited liability company (the “CLO III Co-Issuer” and together with the CLO III Issuer, the “CLO III Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO III Issuer.  

The CLO III Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the CLO III Closing Date (the “CLO III Indenture”), by and among the CLO III Issuers and State Street Bank and Trust Company:  (i) $166 million of AAA(sf) Class A-1L Notes, which bear interest at three-month LIBOR plus 1.80%, (ii) $40 million of AAA(sf) Class A-1F Notes, which bear interest at a fixed rate of 2.75%, (iii) $20 million of AAA(sf)

65


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Class A-2 Notes, which bear interest at three-month LIBOR plus 2.00%,  and (iv) $34 million of AA(sf) Class B Notes, which bear interest at three-month LIBOR plus 2.45% (together, the “CLO III Debt”).  The CLO III Debt is scheduled to mature on April 20, 2032.  The CLO III Debt was privately placed by SG Americas Securities, LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO III Debt.

Concurrently with the issuance of the CLO III Debt, the CLO III Issuer issued approximately $135.31 million of subordinated securities in the form of 135,310 preferred shares at an issue price of U.S.$1,000 per share (the “CLO III Preferred Shares”).  The CLO III Preferred Shares were issued by the CLO III Issuer as part of its issued share capital and are not secured by the collateral securing the CLO III Debt. The Company owns all of the CLO III Preferred Shares, and as such, these securities are eliminated in consolidation.  The Company acts as retention holder in connection with the CLO III Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO III Preferred Shares.

The Adviser serves as collateral manager for the  CLO III  Issuer under a collateral management agreement dated as of the CLO III Closing Date.  The Adviser  is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO III Issuers’ equity or notes owned by the Company.

The CLO III Debt is secured by all of the assets of the CLO III Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO III Transaction, ORCC Financing IV LLC and the Company sold and contributed approximately $400 million par amount of middle market loans to the CLO III Issuer on the CLO III Closing Date.  Such loans constituted the initial portfolio assets securing the CLO III Debt.  The Company and ORCC Financing IV LLC each made customary representations, warranties, and covenants to the CLO III Issuer regarding such sales and contributions under a loan sale agreement.

Through April 20, 2024, a portion of the proceeds received by the CLO III Issuer from the loans securing the CLO III Debt may be used by the CLO III Issuer to purchase additional middle market loans under the direction of the Adviser as the collateral manager for the CLO III Issuer and in accordance with the Company’s investing strategy and ability to originate eligible middle market loans.  

The CLO III Debt is the secured obligation of the CLO III Issuers, and the CLO III Indenture includes customary covenants and events of default.  Assets pledged to holders of the CLO III Debt and the other secured parties under the CLO III Indenture will not be available to pay the debts of the Company.

The CLO III Debt was offered in reliance on Section 4(a)(2) of the Securities Act. The CLO III Debt has not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable.

CLO IV

On May 28, 2020 (the “CLO IV Closing Date”), the Company completed a $438.9 million term debt securitization transaction (the “CLO IV Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by the Company. The secured notes and preferred shares issued in the CLO IV Transaction were issued by the Company’s consolidated subsidiaries Owl Rock CLO IV, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO IV Issuer”), and Owl Rock CLO IV, LLC, a Delaware limited liability company (the “CLO IV Co-Issuer” and together with the CLO IV Issuer, the “CLO IV Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO IV Issuer.

The CLO IV Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO IV Indenture”), by and among the CLO IV Issuers and State Street Bank and Trust Company: (i) $236.5 million of AAA(sf) Class A-1 Notes, which bear interest at three-month LIBOR plus 2.62% and (ii) $15.5 million of AAA(sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 3.40% (together, the “CLO IV Secured Notes”). The CLO IV Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO IV Issuer. The CLO IV Secured Notes are scheduled to mature on May 20, 2029. The CLO IV Secured Notes were privately placed by Natixis Securities Americas LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO IV Secured Notes.

66


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Concurrently with the issuance of the CLO IV Secured Notes, the CLO IV Issuer issued approximately $186.9 million of subordinated securities in the form of 186,900 preferred shares at an issue price of U.S.$1,000 per share (the “CLO IV Preferred Shares”). The CLO IV Preferred Shares were issued by the CLO IV Issuer as part of its issued share capital and are not secured by the collateral securing the CLO IV Secured Notes. The Company purchased all of the CLO IV Preferred Shares. The Company acts as retention holder in connection with the CLO IV Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO IV Preferred Shares.

As part of the CLO IV Transaction, the Company entered into a loan sale agreement with the CLO IV Issuer dated as of the CLO IV Closing Date, which provided for the sale and contribution of approximately $275.07 million par amount of middle market loans from the Company to the CLO IV Issuer on the CLO IV Closing Date and for future sales from the Company to the CLO IV Issuer on an ongoing basis. Such loans constituted part of the initial portfolio of assets securing the CLO IV Secured Notes. The remainder of the initial portfolio assets securing the CLO IV Secured Notes consisted of approximately $174.92 million par amount of middle market loans purchased by the CLO IV Issuer from ORCC Financing II LLC, a wholly-owned subsidiary of the Company, under an additional loan sale agreement executed on the CLO IV Closing Date between the Issuer and ORCC Financing II LLC. The Company and ORCC Financing II LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement.

Through November 20, 2021, a portion of the proceeds received by the CLO IV Issuer from the loans securing the CLO IV Secured Notes may be used by the CLO IV Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO IV Issuer and in accordance with the Company’s investing strategy and ability to originate eligible middle market loans.

The Secured Notes are the secured obligation of the CLO IV Issuers, and the CLO IV Indenture includes customary covenants and events of default. The CLO IV Secured Notes have not been registered under the Securities Act, or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser will serve as collateral manager for the CLO IV Issuer under a collateral management agreement dated as of the CLO IV Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO IV Issuers’ equity or notes owned by the Company.

CLO V

On November 20, 2020 (the “CLO V Closing Date”), the Company completed a $345.45 million term debt securitization transaction (the “CLO V Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by the Company. The secured notes and preferred shares issued in the CLO V Transaction were issued by the Company’s consolidated subsidiaries Owl Rock CLO V, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO V Issuer”), and Owl Rock CLO V, LLC, a Delaware limited liability company (the “CLO V Co-Issuer” and together with the CLO V Issuer, the “CLO V Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO V Issuer.

The CLO V Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO V Indenture”), by and among the CLO V Issuers and State Street Bank and Trust Company: (i) $182 million of AAA(sf)/AAAsf Class A-1 Notes, which bear interest at three-month LIBOR plus 1.85% and (ii) $14 million of AAA(sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.20% (together, the “CLO V Secured Notes”). The CLO V Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO V Issuer. The CLO V Secured Notes are scheduled to mature on November 20, 2029. The CLO V Secured Notes were privately placed by Natixis Securities Americas LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO V Secured Notes.

Concurrently with the issuance of the CLO V Secured Notes, the CLO V Issuer issued approximately $149.45 million of subordinated securities in the form of 149,450 preferred shares at an issue price of U.S.$1,000 per share (the “CLO V Preferred Shares”). The CLO V Preferred Shares were issued by the CLO V Issuer as part of its issued share capital and are not secured by the collateral securing the CLO V Secured Notes. The Company purchased all of the CLO V Preferred Shares. The Company acts as retention holder in connection with the CLO V Transaction for the purposes of satisfying certain U.S. and European Union regulations

67


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO V Preferred Shares.

As part of the CLO V Transaction, the Company entered into a loan sale agreement with the CLO V Issuer dated as of the CLO V Closing Date, which provided for the sale and contribution of approximately $201.75 million par amount of middle market loans from the Company to the CLO V Issuer on the CLO V Closing Date and for future sales from the Company to the CLO V Issuer on an ongoing basis. Such loans constituted part of the initial portfolio of assets securing the CLO V Secured Notes. The remainder of the initial portfolio assets securing the CLO V Secured Notes consisted of approximately $84.74 million par amount of middle market loans purchased by the CLO V Issuer from ORCC Financing II LLC, a wholly-owned subsidiary of the Company, under an additional loan sale agreement executed on the CLO V Closing Date between the Issuer and ORCC Financing II LLC. The Company and ORCC Financing II LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement.

Through July 20, 2022, a portion of the proceeds received by the CLO V Issuer from the loans securing the CLO V Secured Notes may be used by the CLO V Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO V Issuer and in accordance with the Company’s investing strategy and ability to originate eligible middle market loans.

The Secured Notes are the secured obligation of the CLO V Issuers, and the CLO V Indenture includes customary covenants and events of default. The CLO V Secured Notes have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser will serve as collateral manager for the CLO V Issuer under a collateral management agreement dated as of the CLO V Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO V Issuers’ equity or notes owned by the Company.

CLO VI

On May 5, 2021 (the “CLO VI Closing Date”), the Company completed a $397.78 million term debt securitization transaction (the “CLO VI Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by the Company. The secured notes and preferred shares issued in the CLO VI Transaction were issued by the Company’s consolidated subsidiaries Owl Rock CLO VI, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO VI Issuer”), and Owl Rock CLO VI, LLC, a Delaware limited liability company (the “CLO VI Co-Issuer” and together with the CLO VI Issuer, the “CLO VI Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO VI Issuer.

The CLO VI Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO VI Indenture”), by and among the CLO VI Issuers and State Street Bank and Trust Company: (i) $ 224 million of AAA(sf) Class A Notes, which bear interest at three-month LIBOR plus 1.45%, (ii) $26 million of AA(sf) Class B-1 Notes, which bear interest at three-month LIBOR plus 1.75% and (iii) $10 million of AA(sf) Class B-F Notes, which bear interest at a fixed rate of 2.83%  (together, the “CLO VI Secured Notes”). The CLO VI Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO VI Issuer. The CLO VI Secured Notes are scheduled to mature on June 21, 2032. The CLO VI Secured Notes are privately placed by SG Americas Securities, LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO VI Secured Notes.

Concurrently with the issuance of the CLO VI Secured Notes, the CLO VI Issuer issued approximately $137.78 million of subordinated securities in the form of 137,775 preferred shares at an issue price of U.S.$1,000 per share (the “CLO VI Preferred Shares”). The CLO VI Preferred Shares were issued by the CLO VI Issuer as part of its issued share capital and are not secured by the collateral securing the CLO VI Secured Notes. The Company purchased all of the CLO VI Preferred Shares. The Company acts as retention holder in connection with the CLO VI Transaction for the purposes of satisfying certain U.S., United Kingdom and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO VI Preferred Shares.

As part of the CLO VI Transaction, the Company entered into a loan sale agreement with the CLO VI Issuer dated as of the CLO VI Closing Date, which provides for the sale and contribution of approximately $205.6 million par amount of middle market loans from the Company to the CLO VI Issuer on the CLO VI Closing Date and for future sales from the Company to the CLO VI Issuer on

68


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

an ongoing basis. Such loans constitute part of the initial portfolio of assets securing the CLO VI Secured Notes. The remainder of the initial portfolio assets securing the CLO VI Secured Notes consists of approximately $164.7 million par amount of middle market loans purchased by the CLO VI Issuer from ORCC Financing IV LLC, a wholly-owned subsidiary of the Company, under an additional loan sale agreement executed on the CLO VI Closing Date between the Issuer and ORCC Financing IV LLC. The Company and ORCC Financing IV LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement.

Through June 20, 2024, a portion of the proceeds received by the CLO VI Issuer from the loans securing the CLO VI Secured Notes may be used by the CLO VI Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO VI Issuer and in accordance with the Company’s investing strategy and ability to originate eligible middle market loans.

The Secured Notes are the secured obligation of the CLO VI Issuers, and the CLO VI Indenture includes customary covenants and events of default. The CLO VI Secured Notes have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser serves as collateral manager for the CLO VI Issuer under a collateral management agreement dated as of the CLO VI Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO VI Issuers’ equity or notes owned by the Company.

Unsecured Notes

2023 Notes

On December 21, 2017, the Company entered into a Note Purchase Agreement governing the issuance of $150 million in aggregate principal amount of unsecured notes (the “2023 Notes”) to institutional investors in a private placement. The issuance of $138.5 million of the 2023 Notes occurred on December 21, 2017, and $11.5 million of the 2023 Notes were issued in January 2018.  The 2023 Notes have a fixed interest rate of 4.75% and are due on June 21, 2023. Interest on the 2023 Notes will be due semiannually. This interest rate is subject to increase (up to a maximum interest rate of 5.50%) in the event that, subject to certain exceptions, the 2023 Notes cease to have an investment grade rating. The Company is obligated to offer to repay the 2023 Notes at par if certain change in control events occur. The 2023 Notes are general unsecured obligations of the Company that rank pari passu with all outstanding and future unsecured unsubordinated indebtedness issued by the Company.

The Note Purchase Agreement for the 2023 Notes contains customary terms and conditions for unsecured notes issued in a private placement, including, without limitation, affirmative and negative covenants such as information reporting, maintenance of the Company’s status as a BDC within the meaning of the 1940 Act and a RIC under the Code, minimum shareholders equity, minimum asset coverage ratio and prohibitions on certain fundamental changes at the Company or any subsidiary guarantor, as well as customary events of default with customary cure and notice, including, without limitation, nonpayment, misrepresentation in a material respect, breach of covenant, cross-default under other indebtedness of the Company or certain significant subsidiaries, certain judgments and orders, and certain events of bankruptcy.

The 2023 Notes were offered in reliance on Section 4(a)(2) of the Securities Act. The 2023 Notes have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable.

In connection with the offering of the 2023 Notes, on December 21, 2017 the Company entered into a centrally cleared interest rate swap.  The notional amount of the interest rate swap is $150 million. The Company will receive fixed rate interest semi-annually at 4.75% and pay variable rate interest monthly based on 1-month LIBOR plus 2.545%. The interest rate swap matures on December 21, 2021. For the three months ended March 31, 2021 and 2020, the Company made periodic payments of $1.0 million and $1.6 million, respectively. The interest expense related to the 2023 Notes is equally offset by the proceeds received from the interest rate swap. The swap adjusted interest expense is included as a component of interest expense on the Company’s Consolidated Statements of Operations. As of March 31, 2021 and December 31, 2020, the interest rate swap had a fair value of $2.2 million and $3.0 million, respectively. Depending on the nature of the balance at period end, the fair value of the interest rate swap is either included as a component of accrued expenses and other liabilities or prepaid expenses and other assets on the Company’s Consolidated Statements of Assets and Liabilities.  The change in fair value of the interest rate swap is offset by the change in fair value of the 2023 Notes, with the remaining difference included as a component of interest expense on the Consolidated Statements of Operations.

69


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

2024 Notes

On April 10, 2019, the Company issued $400 million aggregate principal amount of notes that mature on April 15, 2024 (the “2024 Notes”). The 2024 Notes bear interest at a rate of 5.25% per year, payable semi-annually on April 15 and October 15 of each year, commencing on October 15, 2019. The Company may redeem some or all of the 2024 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2024 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2024 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if the Company redeems any 2024 Notes on or after March 15, 2024 (the date falling one month prior to the maturity date of the 2024 Notes), the redemption price for the 2024 Notes will be equal to 100% of the principal amount of the 2024 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with the issuance of the 2024 Notes, on April 10, 2019 the Company entered into centrally cleared interest rate swaps. The notional amount of the interest rate swaps is $400 million. The Company will receive fixed rate interest at 5.25% and pay variable rate interest based on one-month LIBOR plus 2.937%. The interest rate swaps mature on April 10, 2024. For the three months ended March 31, 2021 and 2020, the Company made no periodic payments. The interest expense related to the 2024 Notes is equally offset by the proceeds received from the interest rate swaps. The swap adjusted interest expense is included as a component of interest expense on the Company’s Consolidated Statements of Operations. As of March 31, 2021 and December 31, 2020, the interest rate swap had a fair value of $22.0 million and $26.9 million, respectively.  Depending on the nature of the balance at period end, the fair value of the interest rate swap is either included as a component of accrued expenses and other liabilities or prepaid expenses and other assets on the Company’s Consolidated Statements of Assets and Liabilities.  The change in fair value of the interest rate swap is offset by the change in fair value of the 2024 Notes, with the remaining difference included as a component of interest expense on the Consolidated Statements of Operations.

2025 Notes

On October 8, 2019, the Company issued $425 million aggregate principal amount of notes that mature on March 30, 2025 (the “2025 Notes”). The 2025 Notes bear interest at a rate of 4.00% per year, payable semi-annually on March 30 and September 30 of each year, commencing on March 30, 2020. The Company may redeem some or all of the 2025 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2025 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2025 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 40 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if the Company redeems any 2025 Notes on or after February 28, 2025 (the date falling one month prior to the maturity date of the 2025 Notes), the redemption price for the 2025 Notes will be equal to 100% of the principal amount of the 2025 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

July 2025 Notes

On January 22, 2020, the Company issued $500 million aggregate principal amount of notes that mature on July 22, 2025 (the “July 2025 Notes”). The July 2025 Notes bear interest at a rate of 3.75% per year, payable semi-annually on January 22 and July 22, of each year, commencing on July 22, 2020. The Company may redeem some or all of the July 2025 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the July 2025 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the July 2025 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 35 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if the Company redeems any July 2025 Notes on or after June 22, 2025 (the date falling one month prior to the maturity date of the 2025 Notes), the redemption price for the July 2025 Notes will be equal to 100% of the principal amount of the July 2025 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

2026 Notes

On July 23, 2020, the Company issued $500 million aggregate principal amount of notes that mature on January 15, 2026 (the “2026 Notes”). The 2026 Notes bear interest at a rate of 4.25% per year, payable semi-annually on January 15 and July 15 of each year, commencing on January 15, 2021. The Company may redeem some or all of the 2026 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2026 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of

70


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

redemption) on the 2026 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if the Company redeems any 2026 Notes on or after December, 15 2025 (the date falling one month prior to the maturity date of the 2026 Notes), the redemption price for the 2026 Notes will be equal to 100% of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

July 2026 Notes

On December 8, 2020, the Company issued $1.0 billion aggregate principal amount of notes that mature on July 15, 2026 (the “July 2026 Notes”). The July 2026 Notes bear interest at a rate of 3.40% per year, payable semi-annually on January 15 and July 15 of each year, commencing on July 15, 2021. The Company may redeem some or all of the July 2026 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the July 2026 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the July 2026 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if the Company redeems any July 2026 Notes on or after June 15, 2025 (the date falling one month prior to the maturity date of the July 2026 Notes), the redemption price for the July 2026 Notes will be equal to 100% of the principal amount of the July 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

 

2027 Notes

On April 26, 2021, the Company issued $500 million aggregate principal amount of notes that mature on January 15, 2027 (the “2027 Notes”). The 2027 Notes bear interest at a rate of 2.625% per year, payable semi-annually on January 15 and July 15, of each year, commencing on July 15, 2021. The Company may redeem some or all of the 2027 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2027 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2027 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 30 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if the Company redeems any 2027 Notes on or after December 15, 2026 (the date falling one month prior to the maturity date of the 2027 Notes), the redemption price for the 2027 Notes will be equal to 100% of the principal amount of the 2027 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with the issuance of the 2027 Notes, on April 26, 2021, the Company entered into centrally cleared interest rate swaps. The notional amount of the interest rate swaps is $500 million. The Company will receive fixed rate interest at 2.625% and pay variable rate interest based on one-month LIBOR plus 1.655%. The interest rate swaps mature on January 15, 2027. Pursuant to ASC 815 Derivatives and Hedging, the interest expense related to the 2027 Notes is offset by the proceeds received from the interest rate swaps. The swap adjusted interest expense will be included as a component of interest expense on the Company’s Consolidated Statements of Operations.

 

 

71


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Note 7. Commitments and Contingencies

Portfolio Company Commitments

From time to time, the Company may enter into commitments to fund investments. As of March 31, 2021 and December 31, 2020, the Company had the following outstanding commitments to fund investments in current portfolio companies:

 

Portfolio Company

 

Investment

 

 

 

March 31, 2021

 

 

December 31, 2020

 

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

3ES Innovation Inc. (dba Aucerna)

 

First lien senior secured revolving loan

 

$

3,893

 

 

$

3,893

 

Accela, Inc.

 

First lien senior secured revolving loan

 

 

3,000

 

 

 

3,000

 

Amspec Services Inc.

 

First lien senior secured revolving loan

 

 

14,462

 

 

 

14,462

 

Apptio, Inc.

 

First lien senior secured revolving loan

 

 

1,667

 

 

 

2,779

 

Aramsco, Inc.

 

First lien senior secured revolving loan

 

 

8,378

 

 

 

8,378

 

Ardonagh Midco 3 PLC

 

First lien senior secured delayed draw term loan

 

 

6,843

 

 

 

16,950

 

Associations, Inc.

 

First lien senior secured delayed draw term loan

 

 

866

 

 

 

866

 

AxiomSL Group, Inc.

 

First lien senior secured revolving loan

 

 

9,341

 

 

 

9,341

 

Barracuda Dental LLC (dba National Dentex)

 

First lien senior secured delayed draw term loan

 

 

30,438

 

 

 

30,437

 

Barracuda Dental LLC (dba National Dentex)

 

First lien senior secured revolving loan

 

 

3,980

 

 

 

5,854

 

BCTO BSI Buyer, Inc. (dba Buildertrend)

 

First lien senior secured revolving loan

 

 

5,357

 

 

 

5,357

 

BIG Buyer, LLC

 

First lien senior secured delayed draw term loan

 

 

 

 

 

5,625

 

BIG Buyer, LLC

 

First lien senior secured revolving loan

 

 

2,250

 

 

 

2,000

 

Caiman Merger Sub LLC (dba City Brewing)

 

First lien senior secured revolving loan

 

 

12,881

 

 

 

12,881

 

Centrify Corporation

 

First lien senior secured revolving loan

 

 

3,654

 

 

 

 

ConnectWise, LLC

 

First lien senior secured revolving loan

 

 

18,754

 

 

 

15,004

 

Definitive Healthcare Holdings, LLC

 

First lien senior secured delayed draw term loan

 

 

30,701

 

 

 

35,651

 

Definitive Healthcare Holdings, LLC

 

First lien senior secured revolving loan

 

 

9,360

 

 

 

10,870

 

Douglas Products and Packaging Company LLC

 

First lien senior secured revolving loan

 

 

4,844

 

 

 

6,055

 

Endries Acquisition, Inc.

 

First lien senior secured revolving loan

 

 

27,000

 

 

 

27,000

 

Entertainment Benefits Group, LLC

 

First lien senior secured revolving loan

 

 

1,104

 

 

 

1,104

 

Forescout Technologies, Inc.

 

First lien senior secured revolving loan

 

 

5,345

 

 

 

5,345

 

Galls, LLC

 

First lien senior secured revolving loan

 

 

4,566

 

 

 

11,204

 

Gaylord Chemical Company, L.L.C

 

First lien senior secured revolving loan

 

 

13,202

 

 

 

 

GC Agile Holdings Limited (dba Apex Fund Services)

 

First lien senior secured revolving loan

 

 

10,386

 

 

 

6,924

 

Gerson Lehrman Group, Inc.

 

First lien senior secured revolving loan

 

 

21,563

 

 

 

21,563

 

Granicus, Inc.

 

First lien senior secured delayed draw term loan

 

 

2,967

 

 

 

 

Granicus, Inc.

 

First lien senior secured revolving loan

 

 

1,187

 

 

 

2,636

 

H&F Opportunities LUX III S.À R.L (dba Checkmarx)

 

First lien senior secured revolving loan

 

 

16,250

 

 

 

16,250

 

Hercules Borrower, LLC (dba The Vincit Group)

 

First lien senior secured revolving loan

 

 

20,916

 

 

 

20,916

 

72


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Portfolio Company

 

Investment

 

 

 

March 31, 2021

 

 

December 31, 2020

 

HGH Purchaser, Inc. (dba Horizon Services)

 

First lien senior secured delayed draw term loan

 

 

44,518

 

 

 

5,346

 

HGH Purchaser, Inc. (dba Horizon Services)

 

First lien senior secured revolving loan

 

 

9,234

 

 

 

8,748

 

Hometown Food Company

 

First lien senior secured revolving loan

 

 

4,235

 

 

 

3,671

 

Ideal Tridon Holdings, Inc.

 

First lien senior secured revolving loan

 

 

4,828

 

 

 

4,828

 

Individual Foodservice Holdings, LLC

 

First lien senior secured delayed draw term loan

 

 

21,449

 

 

 

25,781

 

Individual Foodservice Holdings, LLC

 

First lien senior secured revolving loan

 

 

17,733

 

 

 

18,465

 

Instructure, Inc.

 

First lien senior secured revolving loan

 

 

5,554

 

 

 

5,554

 

Integrity Marketing Acquisition, LLC

 

First lien senior secured revolving loan

 

 

14,832

 

 

 

14,832

 

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)

 

First lien senior secured delayed draw term loan

 

 

6,153

 

 

 

 

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)

 

First lien senior secured revolving loan

 

 

4,530

 

 

 

4,530

 

Interoperability Bidco, Inc.

 

First lien senior secured delayed draw term loan

 

 

8,000

 

 

 

8,000

 

Interoperability Bidco, Inc.

 

First lien senior secured revolving loan

 

 

4,000

 

 

 

 

IQN Holding Corp. (dba Beeline)

 

First lien senior secured revolving loan

 

 

22,672

 

 

 

22,672

 

KWOR Acquisition, Inc. (dba Worley Claims Services)

 

First lien senior secured delayed draw term loan

 

 

 

 

 

2,063

 

KWOR Acquisition, Inc. (dba Alacrity Solutions)

 

First lien senior secured revolving loan

 

 

4,160

 

 

 

5,200

 

Lazer Spot G B Holdings, Inc.

 

First lien senior secured revolving loan

 

 

26,833

 

 

 

26,833

 

Lightning Midco, LLC (dba Vector Solutions)

 

First lien senior secured revolving loan

 

 

8,953

 

 

 

8,953

 

Litera Bidco LLC

 

First lien senior secured revolving loan

 

 

5,738

 

 

 

5,738

 

Lytx, Inc.

 

First lien senior secured delayed draw term loan

 

 

14,092

 

 

 

14,092

 

Mavis Tire Express Services Corp.

 

Second lien senior secured delayed draw term loan

 

 

 

 

 

11,376

 

MINDBODY, Inc.

 

First lien senior secured revolving loan

 

 

6,071

 

 

 

6,071

 

Nelipak Holding Company

 

First lien senior secured revolving loan

 

 

2,948

 

 

 

2,948

 

Nelipak Holding Company

 

First lien senior secured revolving loan

 

 

7,770

 

 

 

7,597

 

NMI Acquisitionco, Inc. (dba Network Merchants)

 

First lien senior secured revolving loan

 

 

646

 

 

 

646

 

Norvax, LLC (dba GoHealth)

 

First lien senior secured revolving loan

 

 

12,273

 

 

 

12,273

 

Nutraceutical International Corporation

 

First lien senior secured revolving loan

 

 

13,578

 

 

 

13,578

 

PATRIOT ACQUISITION TOPCO S.À R.L. (dba Corza Health, Inc.)

 

First lien senior secured revolving loan

 

 

13,538

 

 

 

 

Peter C. Foy & Associated Insurance Services, LLC

 

First lien senior secured delayed draw term loan C

 

 

12,249

 

 

 

37,955

 

Peter C. Foy & Associated Insurance Services, LLC

 

First lien senior secured delayed draw term loan D

 

 

25,271

 

 

 

 

Peter C. Foy & Associated Insurance Services, LLC

 

First lien senior secured revolving loan

 

 

8,258

 

 

 

8,194

 

PCF Holdco, LLC

 

Class A Units

 

 

17,239

 

 

 

 

Professional Plumbing Group, Inc.

 

First lien senior secured revolving loan

 

 

5,757

 

 

 

5,757

 

Project Power Buyer, LLC (dba PEC-Veriforce)

 

First lien senior secured revolving loan

 

 

3,188

 

 

 

3,188

 

QC Supply, LLC

 

First lien senior secured revolving loan

 

 

633

 

 

 

633

 

Reef Global, Inc. (fka Cheese Acquisition, LLC)

 

First lien senior secured revolving loan

 

 

5,377

 

 

 

5,377

 

73


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Portfolio Company

 

Investment

 

 

 

March 31, 2021

 

 

December 31, 2020

 

Refresh Parent Holdings, Inc.

 

First lien senior secured delayed draw term loan

 

 

13,405

 

 

 

29,482

 

Refresh Parent Holdings, Inc.

 

First lien senior secured revolving loan

 

 

10,776

 

 

 

7,716

 

RSC Acquisition, Inc (dba Risk Strategies)

 

First lien senior secured revolving loan

 

 

933

 

 

 

1,702

 

Safety Products/JHC Acquisition Corp. (dba Justrite Safety Group)

 

First lien senior secured delayed draw term loan

 

 

924

 

 

 

924

 

Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)

 

First lien senior secured revolving loan

 

 

3,360

 

 

 

4,440

 

Sonny's Enterprises LLC

 

First lien senior secured revolving loan

 

 

17,969

 

 

 

17,969

 

Swipe Acquisition Corporation (dba PLI)

 

First lien senior secured delayed draw term loan

 

 

15,347

 

 

 

18,461

 

Swipe Acquisition Corporation (dba PLI)

 

Letter of credit

 

 

7,118

 

 

 

7,118

 

TC Holdings, LLC (dba TrialCard)

 

First lien senior secured revolving loan

 

 

7,685

 

 

 

7,685

 

THG Acquisition, LLC (dba Hilb)

 

First lien senior secured delayed draw term loan

 

 

33,421

 

 

 

36,302

 

THG Acquisition, LLC (dba Hilb)

 

First lien senior secured revolving loan

 

 

8,608

 

 

 

8,608

 

Trader Interactive, LLC (fka Dominion Web Solutions, LLC)

 

First lien senior secured revolving loan

 

 

5,961

 

 

 

4,471

 

Troon Golf, L.L.C.

 

First lien senior secured revolving loan

 

 

14,426

 

 

 

14,426

 

TSB Purchaser, Inc. (dba Teaching Strategies, Inc.)

 

First lien senior secured revolving loan

 

 

4,239

 

 

 

4,239

 

Ultimate Baked Goods Midco, LLC

 

First lien senior secured revolving loan

 

 

4,447

 

 

 

4,638

 

Valence Surface Technologies LLC

 

First lien senior secured delayed draw term loan

 

 

6,000

 

 

 

6,000

 

Valence Surface Technologies LLC

 

First lien senior secured revolving loan

 

 

4,000

 

 

 

10,000

 

WU Holdco, Inc. (dba Weiman Products, LLC)

 

First lien senior secured revolving loan

 

 

13,828

 

 

 

10,739

 

Wingspire Capital Holdings LLC

 

LLC Interest

 

 

32,462

 

 

 

82,462

 

Total Unfunded Portfolio Company Commitments

 

 

 

 

 

$

862,374

 

 

$

880,626

 

 

The Company maintains sufficient borrowing capacity to cover outstanding unfunded portfolio company commitments that the Company may be required to fund.

Other Commitments and Contingencies

The Company had raised $5.5 billion in total Capital Commitments from investors, of which $112.4 million was from executives of Owl Rock. As of June 17, 2019, all outstanding Capital Commitments had been drawn.

In connection with the IPO, on July 22, 2019, the Company entered into the Company 10b5-1 Plan, to acquire up to $150 million in the aggregate of the Company’s common stock at prices below its net asset value per share over a specified period, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the Exchange Act. The Company 10b5-1 Plan commenced on August 19, 2019. Goldman, Sachs & Co., as agent has repurchased an aggregate of 12,515,624 shares of the Company’s common stock pursuant to the Company 10b5-1 Plan for an aggregate of approximately $150 million. The 10b5-1 Plan was exhausted on August 4, 2020.

On November 3, 2020, the Board approved a repurchase program (the “Repurchase Plan”) under which the Company may repurchase up to $100 million of the Company’s outstanding common stock. Under the program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities laws and regulations. Unless extended by the Board, the repurchase program will terminate 12-months from the date it was approved. As of March 31, 2021, no repurchases were made under the Repurchase Plan.

From time to time, the Company may become a party to certain legal proceedings incidental to the normal course of its business. At March 31, 2021, management was not aware of any material pending or threatened litigation that would require accounting recognition or financial statement disclosure.

74


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

Note 8. Net Assets

IPO, Subscriptions and Drawdowns

The Company has the authority to issue 500,000,000 common shares at $0.01 per share par value.

On July 22, 2019, the Company closed its initial public offering (“IPO”), issuing 10 million shares of its common stock at a public offering price of $15.30 per share, and on August 2, 2019, the underwriters exercised their option to purchase an additional 1.5 million shares of common stock at a purchase price of $15.30 per share.  Net of underwriting fees and offering costs, the Company received total cash proceeds of $164.0 million. The Company’s common stock began trading on the New York Stock Exchange (“NYSE”) under the symbol “ORCC” on July 18, 2019.

On July 7, 2019, the Board of Directors determined to eliminate outstanding fractional shares of the Company’s common stock, as permitted by Maryland General Corporation Law. On July 8, 2019, the Company eliminated the fractional shares by rounding down the number of fractional shares held by each shareholder to the nearest whole share and paying each shareholder cash for such fractional shares based on a price of $15.27 per share.

Prior to March 2, 2018, the Company entered into subscription agreements (the “Subscription Agreements”) with investors providing for the private placement of the Company’s common shares. Under the terms of the Subscription Agreements, investors were required to fund drawdowns to purchase the Company’s common shares up to the amount of their respective Capital Commitment on an as-needed basis each time the Company delivered a drawdown notice to its investors. As of June 17, 2019, all outstanding Capital Commitments had been drawn.

On March 1, 2016, the Company issued 100 common shares for $1,500 to the Adviser.

Distributions

The following table reflects the distributions declared on shares of the Company’s common stock during the three months ended March 31, 2021:

 

 

March 31, 2021

 

Date Declared

 

Record Date

 

Payment Date

 

Distribution per Share

 

February 23, 2021

 

March 31, 2021

 

May 14, 2021

 

$

0.31

 

 

On May 5, 2021, the Board declared a distribution of $0.31 per share for shareholders of record on June 30, 2021 payable on or before August 13, 2021.

 

The following table reflects the distributions declared on shares of the Company’s common stock during the three months ended March 31, 2020:

 

 

 

March 31, 2020

 

Date Declared

 

Record Date

 

Payment Date

 

Distribution per Share

 

February 19, 2020

 

March 31, 2020

 

May 15, 2020

 

$

0.31

 

May 28, 2019 (special dividend)

 

March 31, 2020

 

May 15, 2020

 

$

0.08

 

 

 

Dividend Reinvestment

With respect to distributions, the Company has adopted an “opt out” dividend reinvestment plan for common shareholders. As a result, in the event of a declared distribution, each shareholder that has not “opted out” of the dividend reinvestment plan will have their dividends or distributions automatically reinvested in additional shares of the Company’s common stock rather than receiving cash distributions. Shareholders who receive distributions in the form of shares of common stock will be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions.

75


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

The following table reflects the common stock issued pursuant to the dividend reinvestment plan during the three months ended March 31, 2021:

 

Date Declared

 

Record Date

 

Payment Date

 

Shares

 

November 4, 2020

 

December 31, 2020

 

January 19, 2021

 

 

1,435,099

 

 

 

The following table reflects the common stock issued pursuant to the dividend reinvestment plan during the three months ended March 31, 2020:

 

Date Declared

 

Record Date

 

Payment Date

 

Shares

 

October 30, 2019

 

December 31, 2019

 

January 31, 2020

 

 

2,823,048

 

 

 

Stock Repurchase Plans

On July 7, 2019, the Board approved a stock repurchase plan (the “Company 10b5-1 Plan”), to acquire up to $150 million in the aggregate of the Company’s common stock at prices below net asset value per share over a specified period, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the Exchange Act. The Company 10b5-1 Plan commenced on August 19, 2019 and was exhausted on August 4, 2020.

The Company 10b5-1 Plan was intended to allow the Company to repurchase common stock at times when it otherwise might be prevented from doing so under insider trading laws. The Company 10b5-1 Plan required Goldman Sachs & Co. LLC, as agent, to repurchase shares of common stock on the Company’s behalf when the market price per share was below the most recently reported net asset value per share (including any updates, corrections or adjustments publicly announced by us to any previously announced net asset value per share). Under the Company 10b5-1 Plan, the agent would increase the volume of purchases made as the price of the Company’s common stock declined, subject to volume restrictions.

The purchase of shares pursuant to the Company 10b5-1 Plan was intended to satisfy the conditions of Rule 10b5-1 and Rule 10b-18 under the Exchange Act, and was otherwise subject to applicable law, including Regulation M, which may prohibit purchases under certain circumstances.

The following table provides information regarding purchases of the Company’s common stock by Goldman, Sachs & Co., as agent, pursuant to the 10b5-1 plan for each month in the year ended December 31, 2020:

 

Period

($ in millions, except share and per share amounts)

 

Total Number

of Shares

Repurchased

 

 

Average Price Paid per Share

 

 

Approximate

Dollar Value of

Shares that have been

Purchased Under

the Plans

 

 

Approximate

Dollar Value

of Shares that

May Yet Be

Purchased Under

the Plan

 

January 1, 2020 - January 31, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

150.0

 

February 1, 2020 - February 29, 2020

 

 

87,328

 

 

$

15.17

 

 

$

1.4

 

 

$

148.6

 

March 1, 2020 - March 31, 2020

 

 

4,009,218

 

 

$

12.46

 

 

$

46.6

 

 

$

102.0

 

April 1, 2020 - April 30, 2020

 

 

6,235,497

 

 

$

11.95

 

 

$

74.3

 

 

$

27.7

 

May 1, 2020 - May 31, 2020

 

 

2,183,581

 

 

$

12.76

 

 

$

27.7

 

 

$

-

 

June 1, 2020 - June 30, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

-

 

July 1, 2020 - July 31, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

-

 

August 1, 2020 - August 31, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

-

 

Total

 

 

12,515,624

 

 

 

 

 

 

$

150.0

 

 

 

 

 

 

On November 3, 2020, the Board approved a repurchase program under which the Company may repurchase up to $100 million of the Company’s outstanding common stock. Under the program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities laws and regulations. Unless extended by the Board, the repurchase program will terminate 12-months from the date it was approved. As of March 31, 2021, no repurchases were made under the Repurchase Plan.

76


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Note 9. Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per common share for the three months ended March 31, 2021 and 2020:

 

 

 

For the Three Months Ended March 31,

 

($ in thousands, except per share amounts)

 

2021

 

 

2020

 

Increase (decrease) in net assets resulting from operations

 

$

157,845

 

 

$

(312,590

)

Weighted average shares of common stock

   outstanding—basic and diluted

 

 

391,114,767

 

 

 

393,441,711

 

Earnings per common share-basic and diluted

 

$

0.40

 

 

$

(0.79

)

 

 

Note 10. Income Taxes

     The Company has elected to be treated as a RIC under Subchapter M of the Code, and intends to operate in a manner so as to continue to qualify for the tax treatment applicable to RICs. To qualify for tax treatment as a RIC, the Company must, among other things, distribute to its shareholders in each taxable year generally at least 90% of the Company’s investment company taxable income, as defined by the Code, and net tax-exempt income for that taxable year. To maintain tax treatment as a RIC, the Company, among other things, intends to make the requisite distributions to its shareholders, which generally relieves the Company from corporate-level U.S. federal income taxes.

    Depending on the level of taxable income earned in a tax year, the Company can be expected to carry forward taxable income (including net capital gains, if any) in excess of current year dividend distributions from the current tax year into the next tax year and pay a nondeductible 4% U.S. federal excise tax on such taxable income, as required. To the extent that the Company determines that its estimated current year annual taxable income will be in excess of estimated current year dividend distributions from such income, the Company will accrue excise tax on estimated excess taxable income.

For the three months ended March 31, 2021 and 2020, the Company recorded U.S. federal income tax expense/(benefit) of $1.1 million and $2.0 million, respectively, including U.S. federal excise tax expense/(benefit) of $0.2 million and $2.0 million, respectively.

Taxable Subsidiaries

Certain of the Company’s consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes. For the three months ended March 31, 2021, the Company recorded a net tax expense of approximately $0.9 million for taxable subsidiaries. For the three months ended March 31, 2020, the the Company did not record a net tax expense for taxable subsidiaries.

The Company recorded a net deferred tax liability of $5.3 million and $3.7 million as of March 31, 2021 and December 31, 2020, respectively, for taxable subsidiaries, which is significantly related to GAAP to tax outside basis differences in the taxable subsidiaries' investment in certain partnership interests.

 

77


Owl Rock Capital Corporation

Notes to Consolidated Financial Statements (Unaudited) – Continued

 

 

Note 11. Financial Highlights

The following are the financial highlights for a common share outstanding during the three months ended March 31, 2021 and 2020:

 

 

 

For the Three Months Ended March 31,

($ in thousands, except share and per share amounts)

 

2021

 

 

2020

 

 

Per share data:

 

 

 

 

 

 

 

 

 

Net asset value, beginning of period

 

$

14.74

 

 

$

15.24

 

 

Net investment income(1)

 

 

0.26

 

 

 

0.37

 

 

Net realized and unrealized gain (loss)

 

 

0.13

 

 

 

(1.17

)

 

Total from operations

 

 

0.39

 

 

 

(0.80

)

 

Repurchase of common shares(2)

 

 

-

 

 

 

0.04

 

 

Distributions declared from earnings(2)

 

 

(0.31

)

 

 

(0.39

)

 

Total increase (decrease) in net assets

 

 

0.08

 

 

 

(1.15

)

 

Net asset value, end of period

 

$

14.82

 

 

$

14.09

 

 

Shares outstanding, end of period

 

 

391,401,787

 

 

 

390,856,121

 

 

Per share market value at end of period

 

$

13.77

 

 

 

11.54

 

 

Total Return, based on market value(3)

 

 

11.2

 

%

 

(33.8

)

%

Total Return, based on net asset value(4)

 

 

2.6

 

%

 

(5.2

)

%

Ratios / Supplemental Data(5)

 

 

 

 

 

 

 

 

 

Ratio of total expenses to average net assets(6)(7)

 

 

8.2

 

%

 

4.7

 

%

Ratio of net investment income to average net assets(7)

 

 

7.1

 

%

 

9.6

 

%

Net assets, end of period

 

$

5,802,088

 

 

$

5,507,262

 

 

Weighted-average shares outstanding

 

 

391,114,767

 

 

 

393,441,711

 

 

Total capital commitments, end of period

 

N/A

 

 

N/A

 

 

Ratio of total contributed capital to total committed capital, end of period

 

N/A

 

 

N/A

 

 

Portfolio turnover rate

 

 

5.1

 

%

 

4.7

 

%

________________

 

(1)

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

 

(2)

The per share data was derived using actual shares outstanding at the date of the relevant transaction.

 

(3)

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

 

(4)

Total return is calculated as the change in net asset value (“NAV”) per share during the period, plus distributions per share (assuming dividends and distributions, if any, are reinvested in accordance with the Company’s dividend reinvestment plan), if any, divided by the beginning NAV per share.  

 

(5)

Does not include expenses of investment companies in which the Company invests.

 

(6)

Prior to the management and incentive fee waivers, the total expenses to average net assets for the three months ended March 31, 2020 was 7.0%.

 

(7)

Total return based on market value is calculated as the change in market value per share during the respective periods, taking into account dividends and distributions, if any, reinvested in accordance with the Company’s dividend reinvestment plan. The beginning market value per share is based on the initial public offering price of $15.30 per share.

 

Note 12. Subsequent Events

The Company’s management evaluated subsequent events through the date of issuance of these consolidated financial statements. Other than those previously disclosed, there have been no subsequent events that occurred during such period that would require disclosure in, or would be required to be recognized in, these consolidated financial statements.


 

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

The information contained in this section should be read in conjunction with “ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS”.  This discussion contains forward-looking statements, which relate to future events or the future performance or financial condition of Owl Rock Capital Corporation and involves numerous risks and uncertainties, including, but not limited to, those described in our Form 10-K for the fiscal year December 31, 2020 and in “ITEM 1A. RISK FACTORS.” This discussion also should be read in conjunction with the “Cautionary Statement Regarding Forward Looking Statements” set forth on page 1 of this Quarterly Report on Form 10-Q. Actual results could differ materially from those implied or expressed in any forward-looking statements.

Overview

Owl Rock Capital Corporation (the “Company”, “we”, “us” or “our”) is a Maryland corporation formed on October 15, 2015. We were formed primarily to originate and make loans to, and make debt and equity investments in, U.S. middle market companies. We invest in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity and equity-related securities including warrants, preferred stock and similar forms of senior equity, which may or may not be convertible into a portfolio company’s common equity. Our investment objective is to generate current income, and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns.

We are managed by Owl Rock Capital Advisors LLC (“the Adviser” or “our Adviser”). The Adviser is registered with the U.S. Securities and Exchange Commission (the “SEC”) as an investment adviser under the Investment Advisers Act of 1940, as amended (the "Advisers Act"). Subject to the overall supervision of our board of directors (“the Board” or “our Board”), the Adviser manages our day-to-day operations, and provides investment advisory and management services to us. The Adviser or its affiliates may engage in certain origination activities and receive attendant arrangement, structuring or similar fees. The Adviser is responsible for managing our business and activities, including sourcing investment opportunities, conducting research, performing diligence on potential investments, structuring our investments, and monitoring our portfolio companies on an ongoing basis through a team of investment professionals. The Board consists of eight directors, five of whom are independent.

On July 22, 2019, we closed our initial public offering (“IPO”), issuing 10 million shares of our common stock at a public offering price of $15.30 per share, and on August 2, 2019, the underwriters exercised their option to purchase an additional 1.5 million shares of common stock at a purchase price of $15.30 per share.  Net of underwriting fees and offering costs, we received total cash proceeds of $164.0 million. Our common stock began trading on the New York Stock Exchange (“NYSE”) under the symbol “ORCC” on July 18, 2019. In connection with the IPO, on July 22, 2019, we entered into a stock repurchase plan (the “Company 10b5-1 Plan”), to acquire up to $150 million in the aggregate of our common stock at prices below its net asset value per share over a specified period, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Under the Company 10b5-1 Plan, we acquired 12,515,624 shares for approximately $150 million. The Company 10b5-1 Plan commenced on August 19, 2019 and was exhausted on August 4, 2020.

The Adviser also serves as investment adviser to Owl Rock Capital Corporation II and Owl Rock Core Income Corp.

The Adviser is under common control with Owl Rock Technology Advisors LLC (“ORTA”), Owl Rock Capital Private Fund Advisors LLC (“ORPFA”) and Owl Rock Diversified Advisors LLC (“ORDA”), which also are investment advisers and subsidiaries of Owl Rock Capital Partners. ORTA serves as investment adviser to Owl Rock Technology Finance Corp. and ORDA serves as investment adviser to Owl Rock Capital Corporation III. The Adviser, ORTA, ORPFA and ORDA are referred to as the “Owl Rock Advisers” and together with Owl Rock Capital Partners are referred to, collectively, as “Owl Rock.”

On December 23, 2020, Owl Rock Capital Group, LLC (“Owl Rock Capital Group”), the parent of the Adviser (and a subsidiary of Owl Rock Capital Partners), and Dyal Capital Partners (“Dyal”) announced they are merging to form Blue Owl Capital Inc. (“Blue Owl”).  Blue Owl will enter the public market via its acquisition by Altimar Acquisition Corporation (NYSE:ATAC) (“Altimar”), a special purpose acquisition company (the “Transaction”). If the Transaction is consummated, there will be no changes to the Company’s investment strategy or the Adviser’s investment team or investment process with respect to the Company; however, the Transaction will result in a change in control of the Adviser, which will be deemed an assignment of the Investment Advisory Agreement in accordance with the Investment Company Act of 1940, as amended (the “1940 Act”). As a result, the Board, after considering the Transaction and subsequent change in control, has determined that upon consummation of the Transaction, the Company should enter into a third amended and restated investment advisory agreement with the Adviser on terms that are identical to the Investment Advisory Agreement. At a special meeting of the Company's shareholders held on March 17, 2021, the Company's shareholders approved the Company's entry, upon consummation of the Transaction, into the third amended and restated advisory agreement with the Adviser on terms that are identical to the the Advisory Agreement. The Board also determined that upon consummation of the Transaction, the Company should enter into an amended and restated administration agreement with the Adviser on terms that are identical to the Administration Agreement. See “Item 1. Business – The Adviser and Administrator – Owl Rock Capital Advisors LLC.”

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We may be prohibited under the 1940 Act from participating in certain transactions with our affiliates without the prior approval of our directors who are not interested persons and, in some cases, the prior approval of the SEC.  We, our Adviser and certain affiliates have been granted exemptive relief by the SEC to permit us to co-invest with other funds managed by our Adviser or certain of its affiliates, including Owl Rock Capital Corporation II, Owl Rock Capital Corporation III, Owl Rock Technology Finance Corp., Owl Rock Core Income Corp, and other funds managed by the Adviser or its affiliates (together with Owl Rock Capital Corporation, the Owl Rock Clients”), in a manner consistent with our investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. Pursuant to such exemptive relief, we generally are permitted to co-invest with certain of our affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act of our independent directors make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transactions, including the consideration to be paid, are reasonable and fair to us and our shareholders and do not involve overreaching by us or our shareholders on the part of any person concerned, (2) the transaction is consistent with the interests of our shareholders and is consistent with our investment objective and strategies, and (3) the investment by our affiliates would not disadvantage us, and our participation would not be on a basis different from or less advantageous than that on which our affiliates are investing. In addition, pursuant to an exemptive order issued by the SEC on April 8, 2020 and applicable to all BDCs, through December 31, 2020, we were permitted, subject to the satisfaction of certain conditions, to complete follow-on investments in our existing portfolio companies with certain private funds managed by the Adviser or its affiliates and covered by our exemptive relief, even if such private funds had not previously invested in such existing portfolio company. Without this order, private funds would generally not be able to participate in such follow-on investments with us unless the private funds had previously acquired securities of the portfolio company in a co-investment transaction with us. Although the conditional exemptive order has expired, the SEC’s Division of Investment  Management has indicated that until March 31, 2022, it will not recommend enforcement action, to the extent that any BDC with an existing coinvestment order continues to engage in certain transactions described in the conditional exemptive order, pursuant to the same terms and conditions described therein. The Owl Rock Advisers’ allocation policy seeks to ensure equitable allocation of investment opportunities over time between us and other funds managed by our Adviser or its affiliates. As a result of the exemptive relief, there could be significant overlap in our investment portfolio and the investment portfolio of other funds established by the Adviser or its affiliates, including the Owl Rock Clients, that could avail themselves of the exemptive relief.

On April 27, 2016, we formed a wholly-owned subsidiary, OR Lending LLC, a Delaware limited liability company, which holds a California finance lenders license. OR Lending LLC makes loans to borrowers headquartered in California. For time to time we may form wholly-owned subsidiaries to facilitate our normal course of business.

Certain consolidated subsidiaries of ours are subject to U.S. federal and state corporate-level income taxes.

We have elected to be regulated as a BDC under the 1940 Act and as a regulated investment company (“RIC”) for tax purposes under the Internal Revenue Code of 1986, as amended (the “Code”). As a result, we are required to comply with various statutory and regulatory requirements, such as:

 

the requirement to invest at least 70% of our assets in “qualifying assets”, as such term is defined in the 1940 Act;

 

source of income limitations;

 

asset diversification requirements; and

 

the requirement to distribute (or be treated as distributing) in each taxable year at least 90% of our investment company taxable income and tax-exempt interest for that taxable year.

COVID-19 Developments

In March 2020, the outbreak of COVID -19 was recognized as a pandemic by the World Health Organization and in response to the outbreak, our Adviser instituted a work from home policy until it is deemed safe to return to the office.

We have and continue to assess the impact of COVID-19 on our portfolio companies. We cannot predict the full impact of the COVID-19 pandemic, including its duration in the United States and worldwide, the effectiveness of governmental responses designed to mitigate strain to businesses and the economy and the magnitude of the economic impact of the outbreak. The COVID-19 pandemic and preventative measures taken to contain or mitigate its spread have caused, and are continuing to cause, business shutdowns, cancellations of events and travel, significant reductions in demand for certain goods and services, reductions in business activity and financial transactions, supply chain interruptions and overall economic and financial market instability both globally and in the United States. Such effects will likely continue for the duration of the pandemic, which is uncertain, and for some period thereafter.

We have built our portfolio management team to include workout experts and continue to closely monitor our portfolio companies; however, we are unable to predict the duration of any business and supply-chain disruptions, the extent to which COVID-19 will negatively affect our portfolio companies’ operating results or the impact that such disruptions may have on our results of operations and financial condition.

80


 

Our Investment Framework

We are a Maryland corporation organized primarily to originate and make loans to, and make debt and equity investments in, U.S. middle market companies. Our investment objective is to generate current income, and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. Since our Adviser and its affiliates began investment activities in April 2016 through March 31, 2021, our Adviser and its affiliates have originated $30.0 billion aggregate principal amount of investments, of which $28.0 billion of aggregate principal amount of investments prior to any subsequent exits or repayments, was retained by either us or a corporation or fund advised by our Adviser or its affiliates. We seek to generate current income primarily in U.S. middle market companies through direct originations of senior secured loans or originations of unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, investments in equity and equity-related securities including warrants, preferred stock and similar forms of senior equity.

We define “middle market companies” generally to mean companies with earnings before interest expense, income tax expense, depreciation and amortization, or “EBITDA,” between $10 million and $250 million annually and/or annual revenue of $50 million to $2.5 billion at the time of investment, although we may on occasion invest in smaller or larger companies if an opportunity presents itself. We generally seek to invest in companies with a loan-to-value ratio of 50% or below.

We expect that generally our portfolio composition will be majority debt or income producing securities, which may include “covenant-lite” loans (as defined below), with a lesser allocation to equity or equity-linked opportunities. In addition, we may invest a portion of our portfolio in opportunistic investments, which will not be our primary focus, but will be intended to enhance returns to our shareholders. These investments may include high-yield bonds and broadly-syndicated loans. In addition, we generally do not intend to invest more than 20% of our total assets in companies whose principal place of business is outside the United States, although we do not generally intend to invest in companies whose principal place of business is in an emerging market. Our portfolio composition may fluctuate from time to time based on market conditions and interest rates.

Covenants are contractual restrictions that lenders place on companies to limit the corporate actions a company may pursue. Generally, the loans in which we expect to invest will have financial maintenance covenants, which are used to proactively address materially adverse changes in a portfolio company’s financial performance. However, to a lesser extent, we may invest in “covenant-lite” loans. We use the term “covenant-lite” to refer generally to loans that do not have a complete set of financial maintenance covenants. Generally, “covenant-lite” loans provide borrower companies more freedom to negatively impact lenders because their covenants are incurrence-based, which means they are only tested and can only be breached following an affirmative action of the borrower, rather than by a deterioration in the borrower’s financial condition. Accordingly, to the extent we invest in “covenant-lite” loans, we may have fewer rights against a borrower and may have a greater risk of loss on such investments as compared to investments in or exposure to loans with financial maintenance covenants.

As of March 31, 2021, our average debt investment size in each of our portfolio companies was approximately $93.4 million based on fair value. As of March 31, 2021, our portfolio companies, excluding the investment in Sebago Lake and certain investments that fall outside of our typical borrower profile and represent 91.8% of our total debt portfolio based on fair value, had weighted average annual revenue of $466 million and weighted average annual EBITDA of $104 million.

The companies in which we invest use our capital to support their growth, acquisitions, market or product expansion, refinancings and/or recapitalizations. The debt in which we invest typically is not rated by any rating agency, but if these instruments were rated, they would likely receive a rating of below investment grade (that is, below BBB- or Baa3), which is often referred to as “high yield” or “junk”.

Key Components of Our Results of Operations

Investments

We focus primarily on the direct origination of loans to middle market companies domiciled in the United States.

Our level of investment activity (both the number of investments and the size of each investment) can and will vary substantially from period to period depending on many factors, including the amount of debt and equity capital available to middle market companies, the level of merger and acquisition activity for such companies, the general economic environment and the competitive environment for the types of investments we make.

In addition, as part of our risk strategy on investments, we may reduce the levels of certain investments through partial sales or syndication to additional lenders.

Revenues

We generate revenues primarily in the form of interest income from the investments we hold. In addition, we generate income from dividends on either direct equity investments or equity interests obtained in connection with originating loans, such as options, warrants or conversion rights. Our debt investments typically have a term of three to ten years. As of March 31, 2021, 99.9% of our

81


 

debt investments based on fair value bear interest at a floating rate, subject to interest rate floors, in certain cases. Interest on our debt investments is generally payable either monthly or quarterly.

Our investment portfolio consists primarily of floating rate loans, and our credit facilities bear interest at floating rates. Macro trends in base interest rates like London Interbank Offered Rate (“LIBOR”) and any alternative reference rates may affect our net investment income over the long term. However, because we generally originate loans to a small number of portfolio companies each quarter, and those investments vary in size, our results in any given period, including the interest rate on investments that were sold or repaid in a period compared to the interest rate of new investments made during that period, often are idiosyncratic, and reflect the characteristics of the particular portfolio companies that we invested in or exited during the period and not necessarily any trends in our business or macro trends.

Loan origination fees, original issue discount and market discount or premium are capitalized, and we accrete or amortize such amounts under U.S. generally accepted accounting principles ("U.S. GAAP") as interest income using the effective yield method for term instruments and the straight-line method for revolving or delayed draw instruments. Repayments of our debt investments can reduce interest income from period to period. The frequency or volume of these repayments may fluctuate significantly. We record prepayment premiums on loans as interest income.  We may also generate revenue in the form of commitment, loan origination, structuring, or due diligence fees, fees for providing managerial assistance to our portfolio companies and possibly consulting fees.

Dividend income on equity investments is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded companies.

Our portfolio activity also reflects the proceeds from sales of investments. We recognize realized gains or losses on investments based on the difference between the net proceeds from the disposition and the amortized cost basis of the investment without regard to unrealized gains or losses previously recognized. We record current period changes in fair value of investments that are measured at fair value as a component of the net change in unrealized gains (losses) on investments in the consolidated statement of operations.

Expenses

Our primary operating expenses include the payment of the management fee and, since the expiration of the incentive fee waiver on October 18, 2020, the incentive fee, expenses reimbursable under the Administration Agreement and Investment Advisory Agreement, legal and professional fees, interest and other debt expenses and other operating expenses. The management fee and incentive fee compensate our Adviser for work in identifying, evaluating, negotiating, closing, monitoring and realizing our investments.

Except as specifically provided below, all investment professionals and staff of the Adviser, when and to the extent engaged in providing investment advisory and management services to us, the base compensation, bonus and benefits, and the routine overhead expenses of such personnel allocable to such services, are provided and paid for by the Adviser. We bear our allocable portion of the compensation paid by the Adviser (or its affiliates) to our Chief Compliance Officer and Chief Financial Officer and their respective staffs (based on a percentage of time such individuals devote, on an estimated basis, to our business affairs). We bear all other costs and expenses of our operations, administration and transactions, including, but not limited to (i) investment advisory fees, including management fees and incentive fees, to the Adviser, pursuant to the Investment Advisory Agreement; (ii) our allocable portion of overhead and other expenses incurred by the Adviser in performing its administrative obligations under the Administration Agreement; and (iii) all other costs and expenses of its operations and transactions including, without limitation, those relating to:

 

the cost of our organization and offerings;

 

the cost of calculating our net asset value, including the cost of any third-party valuation services;

 

the cost of effecting any sales and repurchases of our common stock and other securities;

 

fees and expenses payable under any dealer manager agreements, if any;

 

debt service and other costs of borrowings or other financing arrangements;

 

costs of hedging;

 

expenses, including travel expense, incurred by the Adviser, or members of the investment team, or payable to third parties, performing due diligence on prospective portfolio companies and, if necessary, enforcing our rights;

 

transfer agent and custodial fees;

 

fees and expenses associated with marketing efforts;

 

federal and state registration fees, any stock exchange listing fees and fees payable to rating agencies;

 

federal, state and local taxes;

 

independent directors’ fees and expenses including certain travel expenses;

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costs of preparing financial statements and maintaining books and records and filing reports or other documents with the SEC (or other regulatory bodies) and other reporting and compliance costs, including registration and listing fees, and the compensation of professionals responsible for the preparation of the foregoing;

 

the costs of any reports, proxy statements or other notices to our shareholders (including printing and mailing costs), the costs of any shareholder or director meetings and the compensation of investor relations personnel responsible for the preparation of the foregoing and related matters;

 

commissions and other compensation payable to brokers or dealers;

 

research and market data;

 

fidelity bond, directors’ and officers’ errors and omissions liability insurance and other insurance premiums;

 

direct costs and expenses of administration, including printing, mailing, long distance telephone and staff;

 

fees and expenses associated with independent audits, outside legal and consulting costs;

 

costs of winding up;

 

costs incurred in connection with the formation or maintenance of entities or vehicles to hold our assets for tax or other purposes;

 

extraordinary expenses (such as litigation or indemnification); and

 

costs associated with reporting and compliance obligations under the 1940 Act and applicable federal and state securities laws.

We expect, but cannot assure, that our general and administrative expenses will increase in dollar terms during periods of asset growth, but will decline as a percentage of total assets during such periods.

Leverage

The amount of leverage we use in any period depends on a variety of factors, including cash available for investing, the cost of financing and general economic and market conditions. Generally, our total borrowings are limited so that we cannot incur additional borrowings, including through the issuance of additional debt securities, if such additional indebtedness would cause our asset coverage ratio to fall below 150%. This means that generally, we can borrow up to $2 for every $1 of investor equity. In any period, our interest expense will depend largely on the extent of our borrowing, and we expect interest expense will increase as we increase our debt outstanding. In addition, we may dedicate assets to financing facilities.

Our current target leverage ratio is 0.90x-1.25x.

Market Trends

We believe the middle-market lending environment provides opportunities for us to meet our goal of making investments that generate attractive risk-adjusted returns based on a combination of the following factors, which continue to remain true in the current environment, with the economic shutdown resulting from the COVID-19 national health emergency.

Limited Availability of Capital for Middle-Market Companies. We believe that regulatory and structural changes in the market have reduced the amount of capital available to U.S. middle-market companies. In particular, we believe there are currently fewer providers of capital to middle market companies. We believe that many commercial and investment banks have, in recent years, de-emphasized their service and product offerings to middle-market businesses in favor of lending to large corporate clients and managing capital markets transactions. In addition, these lenders may be constrained in their ability to underwrite and hold bank loans and high yield securities for middle-market issuers as they seek to meet existing and future regulatory capital requirements. We also believe that there is a lack of market participants that are willing to hold meaningful amounts of certain middle-market loans. As a result, we believe our ability to minimize syndication risk for a company seeking financing by being able to hold its loans without having to syndicate them, coupled with reduced capacity of traditional lenders to serve the middle-market, present an attractive opportunity to invest in middle-market companies.

Capital Markets Have Been Unable to Fill the Void in U.S. Middle Market Finance Left by Banks. While underwritten bond and syndicated loan markets have been robust in recent years, middle market companies are less able to access these markets for reasons including the following:

High Yield Market – Middle market companies generally are not issuing debt in an amount large enough to be an attractively sized bond. High yield bonds are generally purchased by institutional investors who, among other things, are focused on the liquidity characteristics of the bond being issued. For example, mutual funds and exchange traded funds (“ETFs”) are significant buyers of underwritten bonds. However, mutual funds and ETFs generally require the ability to liquidate their investments quickly in order to fund investor redemptions and/or comply with regulatory requirements. Accordingly, the existence of an active secondary market for

83


 

bonds is an important consideration in these entities’ initial investment decision. Because there is typically little or no active secondary market for the debt of U.S. middle market companies, mutual funds and ETFs generally do not provide debt capital to U.S. middle market companies. We believe this is likely to be a persistent problem and creates an advantage for those like us who have a more stable capital base and have the ability to invest in illiquid assets.

Syndicated Loan Market – While the syndicated loan market is modestly more accommodating to middle market issuers, as with bonds, loan issue size and liquidity are key drivers of institutional appetite and, correspondingly, underwriters’ willingness to underwrite the loans. Loans arranged through a bank are done either on a “best efforts” basis or are underwritten with terms plus provisions that permit the underwriters to change certain terms, including pricing, structure, yield and tenor, otherwise known as “flex”, to successfully syndicate the loan, in the event the terms initially marketed are insufficiently attractive to investors. Furthermore, banks are generally reluctant to underwrite middle market loans because the arrangement fees they may earn on the placement of the debt generally are not sufficient to meet the banks’ return hurdles. Loans provided by companies such as ours provide certainty to issuers in that we can commit to a given amount of debt on specific terms, at stated coupons and with agreed upon fees. As we are the ultimate holder of the loans, we do not require market “flex” or other arrangements that banks may require when acting on an agency basis.

Robust Demand for Debt Capital. We believe U.S. middle market companies will continue to require access to debt capital to refinance existing debt, support growth and finance acquisitions. In addition, we believe the large amount of uninvested capital held by funds of private equity firms, estimated by Preqin Ltd., an alternative assets industry data and research company, to be $1.6 trillion as of April 2021, will continue to drive deal activity. We expect that private equity sponsors will continue to pursue acquisitions and leverage their equity investments with secured loans provided by companies such as us.

The Middle Market is a Large Addressable Market. According to GE Capital’s National Center for the Middle Market 4th quarter 2020 Middle Market Indicator, there are approximately 200,000 U.S. middle market companies, which have approximately 48 million aggregate employees. Moreover, the U.S. middle market accounts for one-third of private sector gross domestic product (“GDP”). GE defines U.S. middle market companies as those between $10 million and $1 billion in annual revenue, which we believe has significant overlap with our definition of U.S. middle market companies.

Attractive Investment Dynamics. An imbalance between the supply of, and demand for, middle market debt capital creates attractive pricing dynamics. We believe the directly negotiated nature of middle market financings also generally provides more favorable terms to the lender, including stronger covenant and reporting packages, better call protection, and lender-protective change of control provisions. Additionally, we believe BDC managers’ expertise in credit selection and ability to manage through credit cycles has generally resulted in BDCs experiencing lower loss rates than U.S. commercial banks through credit cycles. Further, we believe that historical middle market default rates have been lower, and recovery rates have been higher, as compared to the larger market capitalization, broadly distributed market, leading to lower cumulative losses. Lastly, we believe that in the current environment, as the economy reopens following the economic shutdown resulting from the COVID-19 national health emergency, lenders with available capital may be able to take advantage of attractive investment opportunities as the economy reopens and may be able to achieve improved economic spreads and documentation terms.

Conservative Capital Structures. Following the credit crisis, which we define broadly as occurring between mid-2007 and mid-2009, lenders have generally required borrowers to maintain more equity as a percentage of their total capitalization, specifically to protect lenders during economic downturns. With more conservative capital structures, U.S. middle market companies have exhibited higher levels of cash flows available to service their debt. In addition, U.S. middle market companies often are characterized by simpler capital structures than larger borrowers, which facilitates a streamlined underwriting process and, when necessary, restructuring process.

Attractive Opportunities in Investments in Loans. We invest in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity and equity-related securities. We believe that opportunities in senior secured loans are significant because of the floating rate structure of most senior secured debt issuances and because of the strong defensive characteristics of these types of investments. Given the current low interest rate environment, we believe that debt issues with floating interest rates offer a superior return profile as compared with fixed-rate investments, since floating rate structures are generally less susceptible to declines in value experienced by fixed-rate securities in a rising interest rate environment. Senior secured debt also provides strong defensive characteristics. Senior secured debt has priority in payment among an issuer’s security holders whereby holders are due to receive payment before junior creditors and equity holders. Further, these investments are secured by the issuer’s assets, which may provide protection in the event of a default.

Portfolio and Investment Activity

As of March 31, 2021, based on fair value, our portfolio consisted of 77.8% first lien senior secured debt investments (of which 39% we consider to be unitranche debt investments (including “last out” portions of such loans)), 16.0% second lien senior secured debt investments, 1.7% unsecured investments, 3.5% equity investments, and 1.0% investment funds and vehicles.

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As of March 31, 2021, our weighted average total yield of the portfolio at fair value and amortized cost was 8.1% and 8.0%, respectively, and our weighted average yield of accruing debt and income producing securities at fair value and amortized cost was 8.3% and 8.2%, respectively.

As of March 31, 2021, we had investments in 120 portfolio companies with an aggregate fair value of $11.2 billion.

Based on current market conditions, the pace of our investment activities, including originations and repayments, may vary. Currently, the strength of the financing and merger and acquisitions markets, coupled with the improved operational and financial performance of portfolio companies as COVID restrictions have eased, has led to increased originations and an active pipeline of investment opportunities.

Our investment activity for the three months ended March 31, 2021 and 2020 is presented below (information presented herein is at par value unless otherwise indicated).

 

 

 

For the Three Months Ended March 31,

 

($ in thousands)

 

2021

 

 

2020

 

New investment commitments

 

 

 

 

 

 

 

 

Gross originations

 

$

919,685

 

 

 

731,012

 

Less: Sell downs

 

 

(56,145

)

 

 

 

Total new investment commitments

 

$

863,540

 

 

$

731,012

 

Principal amount of investments funded:

 

 

 

 

 

 

 

 

First-lien senior secured debt investments

 

$

529,122

 

 

$

425,426

 

Second-lien senior secured debt investments

 

 

12,400

 

 

 

106,313

 

Unsecured debt investments

 

 

132,288

 

 

 

 

Equity investments

 

 

8,567

 

 

 

65,132

 

Investment funds and vehicles

 

 

2,000

 

 

 

18,950

 

Total principal amount of investments funded

 

$

684,377

 

 

$

615,821

 

Principal amount of investments sold or repaid:

 

 

 

 

 

 

 

 

First-lien senior secured debt investments

 

$

(287,315

)

 

$

(383,063

)

Second-lien senior secured debt investments

 

 

(224,851

)

 

 

(34,800

)

Unsecured debt investments

 

 

 

 

 

 

Equity investments

 

 

 

 

 

 

Investment funds and vehicles

 

 

 

 

 

 

Total principal amount of investments sold or repaid

 

$

(512,166

)

 

$

(417,863

)

Number of new investment commitments in new portfolio companies(1)

 

8

 

 

7

 

Average new investment commitment amount

 

$

78,952

 

 

$

75,334

 

Weighted average term for new debt investment commitments (in years)

 

 

5.8

 

 

 

6.0

 

Percentage of new debt investment commitments at

   floating rates

 

 

100.0

%

 

 

100.0

%

Percentage of new debt investment commitments at

   fixed rates

 

 

0.0

%

 

 

0.0

%

Weighted average interest rate of new debt investment

   commitments(2)

 

 

7.3

%

 

 

7.5

%

Weighted average spread over LIBOR of new floating rate debt investment commitments

 

 

6.4

%

 

 

6.1

%

________________

 

(1)

Number of new investment commitments represents commitments to a particular portfolio company.

 

(2)

Assumes each floating rate commitment is subject to the greater of the interest rate floor (if applicable) or 3-month LIBOR, which was 0.19% and 1.45% as of March 31, 2021 and 2020, respectively.

 

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As of March 31, 2021 and December 31, 2020, our investments consisted of the following:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

($ in thousands)

 

Amortized Cost

 

 

Fair Value

 

 

Amortized Cost

 

 

Fair Value

 

First-lien senior secured debt investments

 

$

8,781,815

 

(3)

$

8,744,469

 

 

$

8,483,799

 

(3)

$

8,404,754

 

Second-lien senior secured debt investments

 

 

1,837,093

 

 

 

1,807,521

 

 

 

2,035,151

 

 

 

2,000,471

 

Unsecured debt investments

 

 

188,935

 

 

 

191,211

 

 

 

56,473

 

 

 

59,562

 

Equity investments(1)

 

 

355,068

 

 

 

389,155

 

 

 

245,458

 

 

 

271,739

 

Investment funds and vehicles(2)

 

 

109,838

 

 

 

108,116

 

 

 

107,837

 

 

 

105,546

 

Total Investments

 

$

11,272,749

 

 

$

11,240,472

 

 

$

10,928,718

 

 

$

10,842,072

 

________________

 

(1)

Includes investment in Wingspire.

 

(2)

Includes investment in Sebago Lake.

 

(3)

39% and 37% of which we consider unitranche loans as of March 31, 2021 and December 31, 2020, respectively.

 

The table below describes investments by industry composition based on fair value as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

Advertising and media

 

 

0.9

 

%

 

1.0

 

%

Aerospace and defense

 

 

2.8

 

 

 

2.7

 

 

Automotive

 

 

1.7

 

 

 

1.6

 

 

Buildings and real estate

 

 

4.9

 

 

 

5.6

 

 

Business services

 

 

5.4

 

 

 

5.7

 

 

Chemicals

 

 

3.6

 

 

 

2.2

 

 

Consumer products

 

 

2.2

 

 

 

2.3

 

 

Containers and packaging

 

 

1.9

 

 

 

2.0

 

 

Distribution

 

 

6.0

 

 

 

6.3

 

 

Education

 

 

2.2

 

 

 

2.6

 

 

Energy equipment and services

 

 

0.1

 

 

 

0.1

 

 

Financial services(1)

 

 

5.0

 

 

 

2.9

 

 

Food and beverage

 

 

8.3

 

 

 

8.7

 

 

Healthcare equipment and services

 

 

4.8

 

 

 

3.7

 

 

Healthcare providers and services

 

 

5.3

 

 

 

5.2

 

 

Healthcare technology

 

 

3.3

 

 

 

3.6

 

 

Household products

 

 

2.0

 

 

 

1.4

 

 

Human resource support services(3)

 

 

0.0

 

 

 

0.0

 

 

Infrastructure and environmental services

 

 

1.7

 

 

 

1.8

 

 

Insurance

 

 

8.4

 

 

 

8.9

 

 

Internet software and services

 

 

10.3

 

 

 

11.1

 

 

Investment funds and vehicles(2)

 

 

1.0

 

 

 

1.0

 

 

Leisure and entertainment

 

 

1.9

 

 

 

2.0

 

 

Manufacturing

 

 

5.3

 

 

 

5.3

 

 

Oil and gas

 

 

1.6

 

 

 

1.7

 

 

Professional services

 

 

4.9

 

 

 

5.6

 

 

Specialty retail

 

 

2.1

 

 

 

2.1

 

 

Telecommunications

 

 

0.1

 

 

 

0.5

 

 

Transportation

 

 

2.3

 

 

 

2.4

 

 

Total

 

 

100.0

 

%

 

100.0

 

%

________________

 

(1)

Includes investment in Wingspire.

 

(2)

Includes investment in Sebago Lake.

 

(3)

Rounds to less than 0.1%.

 

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The table below describes investments by geographic composition based on fair value as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

United States:

 

 

 

 

 

 

 

 

 

Midwest

 

 

17.7

 

%

 

18.2

 

%

Northeast

 

 

16.1

 

 

 

16.7

 

 

South

 

 

42.7

 

 

 

42.3

 

 

West

 

 

17.0

 

 

 

17.2

 

 

International

 

 

6.5

 

 

 

5.6

 

(1)

Total

 

 

100.0

 

%

 

100.0

 

%

________________

 

(1)

As of December 31, 2020, the geographic composition of Belgium, Canada, Israel and the United Kingdom were 0.8%, 1.0%, 0.4% and 3.4%, respectively.  

 

The weighted average yields and interest rates of our investments at fair value as of March 31, 2021 and December 31, 2020 were as follows:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

Weighted average total yield of portfolio

 

 

8.1

 

%

 

8.1

 

%

Weighted average total yield of accruing debt and income

  producing securities

 

 

8.3

 

%

 

8.3

 

%

Weighted average interest rate of accruing debt securities

 

 

7.4

 

%

 

7.4

 

%

Weighted average spread over LIBOR of all accruing floating

   rate investments

 

 

6.5

 

%

 

6.6

 

%

 

The weighted average yield of our accruing debt and income producing securities is not the same as a return on investment for our shareholders but, rather, relates to our investment portfolio and is calculated before the payment of all of our and our subsidiaries’ fees and expenses. The weighted average yield was computed using the effective interest rates as of each respective date, including accretion of original issue discount and loan origination fees, but excluding investments on non-accrual status, if any. There can be no assurance that the weighted average yield will remain at its current level.

Our Adviser monitors our portfolio companies on an ongoing basis. It monitors the financial trends of each portfolio company to determine if they are meeting their respective business plans and to assess the appropriate course of action with respect to each portfolio company. Our Adviser has several methods of evaluating and monitoring the performance and fair value of our investments, which may include the following:

 

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

 

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

 

comparisons to other companies in the portfolio company’s industry; and

 

review of monthly or quarterly financial statements and financial projections for portfolio companies.

As part of the monitoring process, our Adviser employs an investment rating system to categorize our investments.  In addition to various risk management and monitoring tools, our Adviser rates the credit risk of all investments on a scale of 1 to 5. This system is intended primarily to reflect the underlying risk of a portfolio investment relative to our initial cost basis in respect of such portfolio investment (i.e., at the time of origination or acquisition), although it may also take into account the performance of the portfolio company’s business, the collateral coverage of the investment and other relevant factors. The rating system is as follows:

 

Investment Rating

 

Description

1

 

Investments rated 1 involve the least amount of risk to our initial cost basis. The borrower is performing above expectations, and the trends and risk factors for this investment since origination or acquisition are generally favorable;

 

2

 

Investments rated 2 involve an acceptable level of risk that is similar to the risk at the time of origination or acquisition. The borrower is generally performing as expected and the risk factors are neutral to favorable. All investments or acquired investments in new portfolio companies are initially assessed a rating of 2;

 

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3

 

Investments rated 3 involve a borrower performing below expectations and indicates that the loan’s risk has increased somewhat since origination or acquisition;

 

4

 

Investments rated 4 involve a borrower performing materially below expectations and indicates that the loan’s risk has increased materially since origination or acquisition.  In addition to the borrower being generally out of compliance with debt covenants, loan payments may be past due (but generally not more than 120 days past due); and

 

5

 

Investments rated 5 involve a borrower performing substantially below expectations and indicates that the loan’s risk has increased substantially since origination or acquisition.  Most or all of the debt covenants are out of compliance and payments are substantially delinquent.  Loans rated 5 are not anticipated to be repaid in full and we will reduce the fair market value of the loan to the amount we anticipate will be recovered.

Our Adviser rates the investments in our portfolio at least quarterly and it is possible that the rating of a portfolio investment may be reduced or increased over time. For investments rated 3, 4 or 5, our Adviser enhances its level of scrutiny over the monitoring of such portfolio company.

The following table shows the composition of our portfolio on the 1 to 5 rating scale as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

Investment Rating

 

Investments

at Fair Value

 

 

Percentage of

Total Portfolio

 

 

Investments

at Fair Value

 

 

Percentage of

Total Portfolio

 

 

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1

 

$

1,410,132

 

 

 

12.6

 

%

$

1,093,318

 

 

 

10.1

 

%

2

 

 

8,744,553

 

 

 

77.8

 

 

 

8,628,248

 

 

 

79.6

 

 

3

 

 

867,691

 

 

 

7.7

 

 

 

904,018

 

 

 

8.3

 

 

4

 

 

218,096

 

 

 

1.9

 

 

 

216,488

 

 

 

2.0

 

 

5

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

11,240,472

 

 

 

100.0

 

%

$

10,842,072

 

 

 

100.0

 

%

 

The following table shows the amortized cost of our performing and non-accrual debt investments as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

 

December 31, 2020

 

 

($ in thousands)

 

Amortized Cost

 

 

Percentage

 

 

Amortized Cost

 

 

Percentage

 

 

Performing

 

$

10,750,792

 

 

 

99.5

 

%

$

10,518,059

 

 

 

99.5

 

%

Non-accrual

 

 

57,051

 

 

 

0.5

 

%

 

57,364

 

 

 

0.5

 

%

Total

 

$

10,807,843

 

 

 

100.0

 

%

$

10,575,423

 

 

 

100.0

 

%

 

Loans are generally placed on non-accrual status when there is reasonable doubt that principal or interest will be collected in full. Accrued interest is generally reversed when a loan is placed on non-accrual status.  Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment regarding collectability. Non-accrual loans are restored to accrual status when past due principal and interest is paid current and, in management’s judgment, are likely to remain current. Management may make exceptions to this treatment and determine to not place a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection.

Sebago Lake LLC

Sebago Lake, a Delaware limited liability company, was formed as a joint venture between us and The Regents of the University of California (“Regents”) and commenced operations on June 20, 2017. Sebago Lake’s principal purpose is to make investments, primarily in senior secured loans that are made to middle-market companies or in broadly syndicated loans. Both we and Regents (the “Members”) have a 50% economic ownership in Sebago Lake. Except under certain circumstances, contributions to Sebago Lake

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cannot be redeemed. Each of the Members initially agreed to contribute up to $100 million to Sebago Lake. On July 26, 2018, each of the Members increased their contribution to Sebago Lake up to an aggregate of $125 million. As of March 31, 2021, each Member has funded $109.8 million of their respective $125 million commitments. Sebago Lake is managed by the Members, each of which have equal voting rights. Investment decisions must be approved by each of the Members.

We have determined that Sebago Lake is an investment company under Accounting Standards Codification (“ASC”) 946, however, in accordance with such guidance, we will generally not consolidate our investment in a company other than a wholly owned investment company subsidiary or a controlled operating company whose business consists of providing services to us. Accordingly, we do not consolidate our non-controlling interest in Sebago Lake.

As of March 31, 2021 and December 31, 2020, Sebago Lake had total investments in senior secured debt at fair value of $539.1 million and $554.7 million, respectively. The determination of fair value is in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 820, Fair Value Measurements (“ASC 820”), as amended; however, such fair value is not included in our Board’s valuation process. The following table is a summary of Sebago Lake’s portfolio as well as a listing of the portfolio investments in Sebago Lake’s portfolio as of March 31, 2021 and December 31, 2020:

 

($ in thousands)

 

March 31, 2021

 

 

December 31, 2020

 

Total senior secured debt investments(1)

 

$

546,400

 

 

$

563,555

 

Weighted average spread over LIBOR(1)

 

 

4.43

%

 

 

4.45

%

Number of portfolio companies

 

16

 

 

17

 

Largest funded investment to a single borrower(1)

 

$

49,500

 

 

$

49,625

 

________________

 

(1)

At par.

 

 

89


 

 

Sebago Lake's Portfolio as of March 31, 2021

($ in thousands)

(Unaudited)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aerospace and defense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)

 

First lien senior secured loan

 

L + 5.25%

 

12/21/2023

 

$

34,739

 

 

$

34,396

 

 

$

34,327

 

 

 

15.9

 

%

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)(14)

 

First lien senior secured revolving loan

 

L + 5.25%

 

12/21/2022

 

 

3,000

 

 

 

2,980

 

 

 

2,964

 

 

 

1.4

 

%

Bleriot US Bidco Inc.(7)(10)

 

First lien senior secured loan

 

L + 4.00%

 

10/30/2026

 

 

19,800

 

 

 

19,680

 

 

 

19,735

 

 

 

9.1

 

%

Dynasty Acquisition Co., Inc. (dba StandardAero Limited)(7)

 

First lien senior secured loan

 

L + 3.50%

 

4/6/2026

 

 

39,400

 

 

 

39,253

 

 

 

35,907

 

 

 

16.6

 

%

 

 

 

 

 

 

 

 

 

96,939

 

 

 

96,309

 

 

 

92,933

 

 

 

43.0

 

%

Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vistage Worldwide, Inc.(7)

 

First lien senior secured loan

 

L + 4.00%

 

2/10/2025

 

 

16,584

 

 

 

16,517

 

 

 

16,501

 

 

 

7.6

 

%

Distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dealer Tire, LLC (6)(10)

 

First lien senior secured loan

 

L + 4.25%

 

12/12/2025

 

 

36,537

 

 

 

36,365

 

 

 

36,552

 

 

 

16.9

 

%

Education

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/30/2025

 

 

34,125

 

 

 

34,056

 

 

 

32,776

 

 

 

15.2

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DecoPac, Inc.(7)

 

First lien senior secured loan

 

L + 4.25%

 

9/30/2024

 

 

20,561

 

 

 

20,506

 

 

 

20,561

 

 

 

9.5

 

%

DecoPac, Inc.(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

9/29/2023

 

 

-

 

 

 

(7

)

 

 

(30

)

 

 

 

%

FQSR, LLC (dba KBP Investments)(7)

 

First lien senior secured loan

 

L + 5.00%

 

5/15/2023

 

 

24,196

 

 

 

24,041

 

 

 

24,229

 

 

 

11.2

 

%

FQSR, LLC (dba KBP Investments)(8)(11)(13)

 

First lien senior secured delayed draw term loan

 

L + 5.00%

 

9/18/2022

 

 

17,987

 

 

 

17,799

 

 

 

18,012

 

 

 

8.3

 

%

Sovos Brands Intermediate, Inc.(8)

 

First lien senior secured loan

 

L + 4.75%

 

11/20/2025

 

 

43,987

 

 

 

43,683

 

 

 

43,987

 

 

 

20.3

 

%

 

 

 

 

 

 

 

 

 

106,731

 

 

 

106,022

 

 

 

106,759

 

 

 

49.3

 

%

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cadence, Inc.(6)

 

First lien senior secured loan

 

L + 4.50%

 

5/21/2025

 

 

26,921

 

 

 

26,498

 

 

 

26,406

 

 

 

12.2

 

%

Cadence, Inc.(9)(11)(14)

 

First lien senior secured revolving loan

 

P + 3.50%

 

5/21/2023

 

 

2,936

 

 

 

2,857

 

 

 

2,795

 

 

 

1.3

 

%

 

 

 

 

 

 

 

 

 

29,857

 

 

 

29,355

 

 

 

29,201

 

 

 

13.5

 

%

Healthcare technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VVC Holdings Corp. (dba Athenahealth, Inc.)(7)(10)

 

First lien senior secured loan

 

L + 4.25%

 

2/11/2026

 

 

17,309

 

 

 

17,053

 

 

 

17,323

 

 

 

8.0

 

%

Infrastructure and environmental services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHA Holding, Inc.(7)

 

First lien senior secured loan

 

L + 4.50%

 

4/10/2025

 

 

41,039

 

 

 

40,771

 

 

 

40,767

 

 

 

18.9

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Integro Parent Inc.(6)

 

First lien senior secured loan

 

L + 5.75%

 

10/31/2022

 

 

29,945

 

 

 

29,886

 

 

 

30,002

 

 

 

13.9

 

%

Integro Parent Inc.(6)(11)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

4/30/2022

 

 

3,504

 

 

 

3,499

 

 

 

3,462

 

 

 

1.6

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(8)

 

First lien senior secured loan

 

L + 4.25%

 

3/29/2025

 

 

40,046

 

 

 

39,434

 

 

 

39,545

 

 

 

18.3

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

3/29/2024

 

 

-

 

 

 

(78

)

 

 

(94

)

 

 

 

%

 

 

 

 

 

 

 

 

 

73,495

 

 

 

72,741

 

 

 

72,915

 

 

 

33.8

 

%

90


 

Sebago Lake's Portfolio as of March 31, 2021

($ in thousands)

(Unaudited)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Internet software and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DCert Buyer, Inc. (dba DigiCert)(6)(10)

 

First lien senior secured loan

 

L + 4.00%

 

10/16/2026

 

 

49,500

 

 

 

49,347

 

 

 

49,371

 

 

 

22.8

 

%

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Engineered Machinery Holdings (dba Duravant)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/19/2024

 

 

44,284

 

 

 

43,979

 

 

 

43,952

 

 

 

20.3

 

%

Total Debt Investments

 

 

 

 

 

 

 

 

546,400

 

 

 

542,515

 

 

 

539,050

 

 

 

249.3

 

%

Total Investments

 

 

 

 

 

 

 

$

546,400

 

 

$

542,515

 

 

$

539,050

 

 

 

249.3

 

%

________________

 

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

 

(2)

Unless otherwise indicated, Sebago Lake’s investments are pledged as collateral supporting the amounts outstanding under Sebago Lake’s credit facility.

 

(3)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

 

(4)

Unless otherwise indicated, all investments are considered Level 3 investments.

 

(5)

Unless otherwise indicated, loan contains a variable rate structure, and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) (which can include one-, two-, three- or six-month LIBOR) or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option, and which reset periodically based on the terms of the loan agreement.

 

(6)

The interest rate on these loans is subject to 1 month LIBOR, which as of March 31, 2021 was 0.11%.

 

(7)

The interest rate on these loans is subject to 3 month LIBOR, which as of March 31, 2021 was 0.19%.

 

(8)

The interest rate on these loans is subject to 6 month LIBOR, which as of March 31, 2021 was 0.21%.

 

(9)

The interest rate on these loans is subject to Prime, which as of March 31, 2021 was 3.25%.

 

(10)

Level 2 investment.

 

(11)

Position or portion thereof is an unfunded loan commitment.

 

(12)

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

 

(13)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

 

(14)

Investment is not pledged as collateral under Sebago Lake’s credit facility.

 

91


 

 

Sebago Lake's Portfolio as of December 31, 2020

($ in thousands)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Debt Investments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aerospace and defense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)

 

First lien senior secured loan

 

L + 5.25%

 

12/21/2023

 

$

34,829

 

 

$

34,455

 

 

$

34,671

 

 

 

16.4

 

%

Applied Composites Holdings, LLC (fka AC&A Enterprises Holdings, LLC)(7)(14)

 

First lien senior secured revolving loan

 

L + 5.25%

 

12/21/2022

 

 

3,000

 

 

 

2,977

 

 

 

2,986

 

 

 

1.4

 

%

Bleriot US Bidco Inc.(7)(10)

 

First lien senior secured loan

 

L + 4.75%

 

10/30/2026

 

 

14,888

 

 

 

14,762

 

 

 

14,827

 

 

 

6.9

 

%

Dynasty Acquisition Co., Inc. (dba StandardAero Limited)(7)

 

First lien senior secured loan

 

L + 3.50%

 

4/4/2026

 

 

39,500

 

 

 

39,345

 

 

 

35,826

 

 

 

17.0

 

%

 

 

 

 

 

 

 

 

 

92,217

 

 

 

91,539

 

 

 

88,310

 

 

 

41.7

 

%

Business Services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Vistage Worldwide, Inc.(7)

 

First lien senior secured loan

 

L + 4.00%

 

2/10/2025

 

 

16,584

 

 

 

16,513

 

 

 

16,418

 

 

 

7.8

 

%

Distribution

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dealer Tire, LLC (6)(10)

 

First lien senior secured loan

 

L + 4.25%

 

12/12/2025

 

 

36,630

 

 

 

36,449

 

 

 

36,293

 

 

 

17.2

 

%

Education

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Spring Education Group, Inc. (fka SSH Group Holdings, Inc.)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/30/2025

 

 

34,212

 

 

 

34,140

 

 

 

32,456

 

 

 

15.4

 

%

Food and beverage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DecoPac, Inc.(7)

 

First lien senior secured loan

 

L + 4.25%

 

9/30/2024

 

 

20,561

 

 

 

20,503

 

 

 

20,561

 

 

 

9.7

 

%

DecoPac, Inc.(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

9/29/2023

 

 

-

 

 

 

(8

)

 

 

(55

)

 

 

 

%

FQSR, LLC (dba KBP Investments)(7)

 

First lien senior secured loan

 

L + 5.00%

 

5/15/2023

 

 

24,259

 

 

 

24,086

 

 

 

24,213

 

 

 

11.5

 

%

FQSR, LLC (dba KBP Investments)(8)(11)(13)

 

First lien senior secured delayed draw term loan

 

L + 5.00%

 

9/10/2021

 

 

17,987

 

 

 

17,778

 

 

 

17,943

 

 

 

8.5

 

%

Sovos Brands Intermediate, Inc.(7)

 

First lien senior secured loan

 

L + 4.75%

 

11/20/2025

 

 

44,100

 

 

 

43,780

 

 

 

44,100

 

 

 

20.9

 

%

 

 

 

 

 

 

 

 

 

106,907

 

 

 

106,139

 

 

 

106,762

 

 

 

50.6

 

%

Healthcare equipment and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cadence, Inc.(6)

 

First lien senior secured loan

 

L + 4.50%

 

5/21/2025

 

 

26,990

 

 

 

26,543

 

 

 

26,446

 

 

 

12.5

 

%

Cadence, Inc.(9)(11)(14)

 

First lien senior secured revolving loan

 

P + 3.50%

 

5/21/2025

 

 

2,936

 

 

 

2,848

 

 

 

2,788

 

 

 

1.3

 

%

 

 

 

 

 

 

 

 

 

29,926

 

 

 

29,391

 

 

 

29,234

 

 

 

13.8

 

%

Healthcare technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VVC Holdings Corp. (dba Athenahealth, Inc.)(6)(10)

 

First lien senior secured loan

 

L + 4.50%

 

2/11/2026

 

 

17,309

 

 

 

17,041

 

 

 

17,262

 

 

 

8.2

 

%

Infrastructure and environmental services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CHA Holding, Inc.(7)

 

First lien senior secured loan

 

L + 4.50%

 

4/10/2025

 

 

41,145

 

 

 

40,861

 

 

 

40,857

 

 

 

19.4

 

%

Insurance

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Integro Parent Inc.(6)

 

First lien senior secured loan

 

L + 5.75%

 

10/31/2022

 

 

30,055

 

 

 

29,987

 

 

 

30,014

 

 

 

14.2

 

%

Integro Parent Inc.(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.50%

 

4/30/2022

 

 

-

 

 

 

(7

)

 

 

(28

)

 

 

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(8)

 

First lien senior secured loan

 

L + 4.25%

 

3/29/2025

 

 

40,149

 

 

 

39,502

 

 

 

39,446

 

 

 

18.7

 

%

USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(11)(12)(14)

 

First lien senior secured revolving loan

 

L + 4.25%

 

3/29/2024

 

 

-

 

 

 

(84

)

 

 

(131

)

 

 

(0.1

)

%

 

 

 

 

 

 

 

 

 

70,204

 

 

 

69,398

 

 

 

69,301

 

 

 

32.8

 

%

Internet software and services

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

DCert Buyer, Inc. (dba DigiCert)(6)(10)

 

First lien senior secured loan

 

L + 4.00%

 

10/16/2026

 

 

49,625

 

 

 

49,466

 

 

 

49,511

 

 

 

23.5

 

%

92


 

Sebago Lake's Portfolio as of December 31, 2020

($ in thousands)

 

Company(1)(2)(4)(5)

 

Investment

 

Interest

 

Maturity Date

 

Par / Units

 

 

Amortized Cost(3)

 

 

Fair Value

 

 

Percentage of Members' Equity

 

 

Manufacturing

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Engineered Machinery Holdings (dba Duravant)(7)

 

First lien senior secured loan

 

L + 4.25%

 

7/19/2024

 

 

44,397

 

 

 

44,071

 

 

 

43,841

 

 

 

20.8

 

%

Transportation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Uber Technologies, Inc.(6)(10)

 

First lien senior secured loan

 

L + 4.00%

 

4/4/2025

 

 

24,399

 

 

 

24,290

 

 

 

24,465

 

 

 

11.6

 

%

Total Debt Investments

 

 

 

 

 

 

 

 

563,555

 

 

 

559,298

 

 

 

554,710

 

 

 

262.8

 

%

Total Investments

 

 

 

 

 

 

 

$

563,555

 

 

$

559,298

 

 

$

554,710

 

 

 

262.8

 

%

________________

 

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

 

(2)

Unless otherwise indicated, the Company’s investments are pledged as collateral supporting the amounts outstanding under its SPV Asset Facility. See Note 6 “Debt”. 

 

(3)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

 

(4)

Unless otherwise indicated, all investments are considered Level 3 investments.

 

(5)

Unless otherwise indicated, loan contains a variable rate structure, which may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) (which can include one-, two-, three- or six-month LIBOR) or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option and which reset periodically based on the terms of the loan agreement.

 

(6)

The interest rate on these loans is subject to 1 month LIBOR, which as of December 31, 2020 was 0.14%.

 

(7)

The interest rate on these loans is subject to 3 month LIBOR, which as of December 31, 2020 was 0.24%.

 

(8)

The interest rate on these loans is subject to 6 month LIBOR, which as of December 31, 2020 was 0.26%.

 

(9)

The interest rate on these loans is subject to Prime, which as of December 31, 2020 was 3.25%.  

 

(10)

Level 2 investment.

 

(11)

Position or portion thereof is an unfunded loan commitment.

 

(12)

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

 

(13)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

 

(14)

Investment is not pledged as collateral under the Company’s SPV Asset Facility.

 

93


 

 

Below is selected balance sheet information for Sebago Lake as of March 31, 2021 and December 31, 2020:

 

($ in thousands)

 

March 31, 2021

(Unaudited)

 

 

December 31, 2020

 

Assets

 

 

 

 

 

 

 

 

Investments at fair value (amortized cost of $542,515 and $559,298, respectively)

 

$

539,050

 

 

$

554,710

 

Cash

 

 

29,268

 

 

 

9,385

 

Interest receivable

 

 

1,032

 

 

 

992

 

Prepaid expenses and other assets

 

 

197

 

 

 

237

 

Total Assets

 

$

569,547

 

 

$

565,324

 

Liabilities

 

 

 

 

 

 

 

 

Debt (net of unamortized debt issuance costs of $2,048 and $2,415, respectively)

 

$

346,834

 

 

$

347,564

 

Distributions payable

 

 

4,735

 

 

 

4,694

 

Accrued expenses and other liabilities

 

 

1,747

 

 

 

1,975

 

Total Liabilities

 

$

353,316

 

 

$

354,233

 

Members' Equity

 

 

 

 

 

 

 

 

Members' Equity

 

 

216,231

 

 

 

211,091

 

Members' Equity

 

 

216,231

 

 

 

211,091

 

Total Liabilities and Members' Equity

 

$

569,547

 

 

$

565,324

 

 

 

Below is selected statement of operations information for Sebago Lake for the three months ended March 31, 2021 and 2020:

 

 

 

For the Three Months Ended March 31,

 

($ in thousands)

 

2021

 

 

2020

 

Investment Income

 

 

 

 

 

 

 

 

Interest income

 

$

7,366

 

 

$

8,502

 

Other income

 

 

148

 

 

 

92

 

Total Investment Income

 

 

7,514

 

 

 

8,594

 

Expenses

 

 

 

 

 

 

 

 

Loan origination and structuring fee

 

 

 

 

 

 

Interest expense

 

 

2,503

 

 

 

3,784

 

Professional fees

 

 

189

 

 

 

167

 

Total Expenses

 

 

2,692

 

 

 

3,951

 

Net Investment Income Before Taxes

 

 

4,822

 

 

 

4,643

 

Taxes

 

 

207

 

 

 

(895

)

Net Investment Income After Taxes

 

$

4,615

 

 

$

5,538

 

Net Realized and Change in Unrealized Gain (Loss) on Investments

 

 

 

 

 

 

 

 

Net change in unrealized gain (loss) on investments

 

 

1,123

 

 

 

(30,960

)

Net realized gain (loss) on investments

 

 

137

 

 

 

 

Total Net Realized and Change in Unrealized Gain (Loss) on Investments

 

 

1,260

 

 

 

(30,960

)

Net Increase (Decrease) in Members' Equity Resulting from Operations

 

$

5,875

 

 

$

(25,422

)

 

 

 

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On August 9, 2017, Sebago Lake Financing LLC and SL Lending LLC, wholly-owned subsidiaries of Sebago Lake, entered into a credit facility with Goldman Sachs Bank USA. Goldman Sachs Bank USA serves as the sole lead arranger, syndication agent and administrative agent, and State Street Bank and Trust Company serves as the collateral administrator and agent. The credit facility includes a maximum borrowing capacity of $400 million. On April 6, 2021, Sebago Lake Financing LLC and SL Lending LLC entered into an amendment with Goldman Sachs Bank USA to extend the reinvestment period on the credit facility to July 6, 2021. As of March 31, 2021, there was $348.9 million outstanding under the credit facility. For the three months ended March 31, 2021 and 2020, the components of interest expense were as follows:

 

 

 

For the Three Months Ended March 31,

($ in thousands)

 

2021

 

 

2020

 

 

Interest expense

 

$

2,097

 

 

$

3,374

 

 

Amortization of debt issuance costs

 

 

406

 

 

 

410

 

 

Total Interest Expense

 

$

2,503

 

 

$

3,784

 

 

Average interest rate

 

 

2.4

 

%

 

4.0

 

%

Average daily borrowings

 

$

349,358

 

 

$

333,446

 

 

 

Loan Origination and Structuring Fees

If the loan origination and structuring fees earned by Sebago Lake during a fiscal period exceed Sebago Lake’s expenses and other obligations (excluding financing costs), such excess is allocated to the Member(s) responsible for the origination of the loans pro rata in accordance with the total loan origination and structuring fees earned by Sebago Lake with respect to the loans originated by such Member; provided, that in no event will the amount allocated to a Member exceed 1% of the par value of the loans originated by such Member in any fiscal year. The loan origination and structuring fee is accrued quarterly and included in other income from controlled, affiliated investments on our Consolidated Statements of Operations and paid annually. On February 27, 2019, the Members agreed to amend the terms of Sebago Lake’s operating agreement to eliminate the allocation of excess loan origination and structuring fees to the Members. As such, for the three months ended March 31, 2021 and 2020, we accrued no income based on loan origination and structuring fees.

 

Results of Operations

The following table represents the operating results for the three months ended March 31, 2021 and 2020:

 

 

 

For the Three Months Ended March 31,

 

($ in millions)

 

2021

 

 

2020

 

Total Investment Income

 

$

221.5

 

 

$

204.7

 

Less: Net operating expenses

 

 

117.8

 

 

 

56.4

 

Net Investment Income (Loss) Before Taxes

 

$

103.7

 

 

$

148.3

 

Less: Income taxes (benefit), including excise taxes

 

 

1.1

 

 

 

2.0

 

Net Investment Income (Loss) After Taxes

 

$

102.6

 

 

$

146.3

 

Net change in unrealized gain (loss)

 

 

52.9

 

 

 

(459.2

)

Net realized gain (loss)

 

 

2.3

 

 

 

0.3

 

Net Increase (Decrease) in Net Assets Resulting from Operations

 

$

157.8

 

 

$

(312.6

)

 

Net increase (decrease) in net assets resulting from operations can vary from period to period as a result of various factors, including the level of new investment commitments, expenses, the recognition of realized gains and losses and changes in unrealized appreciation and depreciation on the investment portfolio.

95


 

Investment Income

Investment income for the three months ended March 31, 2021 and 2020 were as follows:

 

 

 

For the Three Months Ended March 31,

 

($ in millions)

 

2021

 

 

2020

 

Interest income from investments

 

$

212.3

 

 

$

198.4

 

Dividend income

 

 

5.9

 

 

 

2.2

 

Other income

 

 

3.3

 

 

 

4.1

 

Total investment income

 

$

221.5

 

 

$

204.7

 

For the three months ended March 31, 2021 and 2020

Investment income increased to $221.5 million for the three months ended March 31, 2021 from $204.7 million for the same period in prior year primarily due to an increase in our debt investment portfolio, which, at par, increased from $9.3 billion as of March 31, 2020, to $11.0 billion as of March 31, 2021. In addition to the growth in the portfolio resulting from increased originations, the incremental increase in investment income was primarily due to an increase in dividend income earned from our investment in Windows Entities of $2.7 million, that was not earned as of March 31, 2020. Included in interest income are other fees such as prepayment fees and accelerated amortization of upfront fees from unscheduled paydowns. Period over period, income generated from these fees decreased from $9.8 million to $6.4 million, for the three months ended March 31, 2020 and 2021, respectively. Payment-in-kind income represented 5.2% of investment income for the three months ended March 31, 2021 and less than 5% of investment income for the three months ended March 31, 2020. Other income decreased period-over-period due to a decrease in incremental fee income, which are fees that are generally available to us as a result of closing investments and generally paid at the time of closing. We expect that investment income will vary based on a variety of factors including the pace of our originations and repayments. Based on current market conditions and the age of our portfolio, we expect repayments to increase.

Expenses

Expenses for the three months ended March 31, 2021 and 2020 were as follows:

 

 

 

For the Three Months Ended March 31,

 

($ in millions)

 

2021

 

 

2020

 

Interest expense

 

$

48.1

 

 

$

33.9

 

Management fee

 

 

42.1

 

 

 

33.8

 

Performance based incentive fees

 

 

21.8

 

 

 

25.6

 

Professional fees

 

 

3.8

 

 

 

3.2

 

Directors' fees

 

 

0.2

 

 

 

0.2

 

Other general and administrative

 

 

1.8

 

 

 

2.2

 

Total operating expenses

 

$

117.8

 

 

$

98.9

 

Management and incentive fees waived

 

 

 

 

 

(42.5

)

Net operating expenses

 

$

117.8

 

 

$

56.4

 

 

Under the terms of the Administration Agreement, we reimburse the Adviser for services performed for us. In addition, pursuant to the terms of the Administration Agreement, the Adviser may delegate its obligations under the Administration Agreement to an affiliate or to a third party and we reimburse the Adviser for any services performed for us by such affiliate or third party.

For the three months ended March 31, 2021 and 2020

Total expenses increased to $117.8 million for the three months ended March 31, 2021 from $56.4 million for the same period in the prior year primarily due to expiration of the management and incentive fee waiver in October 2020 and an increase in interest expense. The increase in interest expense of $14.2 million was primarily driven by an increase in the average daily borrowings period over period partially offset by a decrease in the average interest rate from 4.2% to 3.2%. As a percentage of total assets, professional fees, directors’ fees, and other general and administrative expenses remained relatively consistent period over period.

Income Taxes, Including Excise Taxes

We have elected to be treated as a RIC under Subchapter M of the Code, and we intend to operate in a manner so as to continue to qualify for the tax treatment applicable to RICs. To qualify for tax treatment as a RIC, we must, among other things, distribute to our shareholders in each taxable year generally at least 90% of our investment company taxable income, as defined by the Code, and net tax-exempt income for that taxable year. To maintain our tax treatment as a RIC, we, among other things, intend to make the requisite distributions to our shareholders, which generally relieves us from corporate-level U.S. federal income taxes.

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Depending on the level of taxable income earned in a tax year, we can be expected to carry forward taxable income (including net capital gains, if any) in excess of current year dividend distributions from the current tax year into the next tax year and pay a nondeductible 4% U.S. federal excise tax on such taxable income, as required. To the extent that we determine that our estimated current year annual taxable income will be in excess of estimated current year dividend distributions from such income, we will accrue excise tax on estimated excess taxable income.

For the three months ended March 31, 2021 and 2020, we recorded U.S. federal income tax expense/(benefit) of $1.1 million and $2.0 million, respectively, including U.S. federal excise tax expense/(benefit) of $0.2 million and $2.0 million, respectively.

Certain of our consolidated subsidiaries are subject to U.S. federal and state income taxes. For the three months ended March 31, 2021, we recorded a net tax expense of $0.9 million. For the three months ended March 31, 2020, we did not record a net tax expense, for these subsidiaries. The income tax expense for our taxable consolidated subsidiaries will vary depending on the level of investment income earnings and realized gains from the exits of investments held by such taxable subsidiaries during the respective periods.

Net Unrealized Gains (Losses)

We fair value our portfolio investments quarterly and any changes in fair value are recorded as unrealized gains or losses.  During the three months ended March 31, 2021 and 2020, net unrealized gains (losses) were comprised of the following:

 

 

 

For the Three Months Ended March 31,

 

($ in millions)

 

2021

 

 

2020

 

Net change in unrealized gain (loss) on investments

 

$

57.9

 

 

$

(459.1

)

Income tax (provision) benefit

 

 

(2.6

)

 

 

 

Net change in translation of assets and liabilities in

     foreign currencies

 

 

(2.4

)

 

 

(0.1

)

Net change in unrealized gain (loss)

 

$

52.9

 

 

$

(459.2

)

For the three months ended March 31, 2021 and 2020

For the three months ended March 31, 2021, the net unrealized gain was primarily driven by an increase in the fair value of our debt investments as compared to December 31, 2020. As of March 31, 2021, the fair value of our debt investments as a percentage of principal was 97.8%, as compared to 97.3% as of December 31, 2020. The changes in net unrealized gain and loss on investments during the three months ended March 31, 2021 consisted of the following:

 

Portfolio Company

($ in millions)

 

Net Change in Unrealized

Gain (Loss)

 

Windows Entities

 

$

10.0

 

Innovative Water Care

 

 

7.1

 

ABB Concise Optical Group LLC

 

 

4.1

 

Blackhawk Network Holdings

 

 

4.0

 

Sonny's Enterprises, Inc.

 

 

3.5

 

Aviation Solutions Midco, LLC

 

 

3.5

 

Mavis Tire Express Services Corp.

 

 

3.2

 

H-Food Holdings, LLC

 

 

2.8

 

Remaining portfolio companies

 

 

30.7

 

Galls, LLC

 

 

(3.9

)

CIBT Global, Inc.

 

 

(7.1

)

Total

 

$

57.9

 

For the three months ended March 31, 2020, the net unrealized loss was primarily driven by a decrease in the fair value of our debt investments as compared to December 31, 2019. As of March 31, 2020, the fair value of our debt investments as a percentage of principal was 93.5%, as compared to 98.0% as of December 31, 2019. The primary driver of our portfolio’s unrealized loss was due

97


 

to current market conditions and credit spreads widening. See “COVID-19 Developments” for additional information. The changes in net unrealized loss on investments during the three months ended March 31, 2020 consisted of the following:

 

Portfolio Company

($ in millions)

 

Net Change in Unrealized

Gain (Loss)

 

Aviation Solutions Midco, LLC (dba STS Aviation)

 

$

(21.4

)

H-Food Holdings, LLC

 

 

(19.8

)

Geodigm Corporation (dba National Dentex)

 

 

(17.6

)

Sebago Lake LLC

 

 

(14.9

)

Swipe Acquisition Corporation (dba PLI)

 

 

(11.5

)

Valence Surface Technologies LLC

 

 

(10.9

)

Mavis Tire Express Services Corp.

 

 

(10.9

)

Endries Acquisition, Inc.

 

 

(10.9

)

Gerson Lehrman Group, Inc.

 

 

(10.8

)

Integrity Marketing Acquisition, LLC

 

 

(10.3

)

Remaining portfolio companies

 

 

(320.1

)

Total

 

$

(459.1

)

Net Realized Gains (Losses)

The realized gains and losses on fully exited and partially exited portfolio companies during the three months ended March 31, 2021 and 2020 were comprised of the following:

 

 

 

For the Three Months Ended March 31,

 

($ in millions)

 

2021

 

 

2020

 

Net realized gain (loss) on investments

 

$

1.1

 

 

$

0.4

 

Net realized gain (loss) on foreign currency transactions

 

 

1.2

 

 

 

(0.1

)

Net realized gain (loss)

 

$

2.3

 

 

$

0.3

 

 

 

Realized Gross Internal Rate of Return

Since we began investing in 2016 through March 31, 2021, our exited investments have resulted in an aggregate cash flow realized gross internal rate of return to us of over 11.8% (based on total capital invested of $3.3 billion and total proceeds from these exited investments of $3.7 billion). Over seventy percent of these exited investments resulted in an aggregate cash flow realized gross internal rate of return (“IRR”) to us of 10% or greater.

IRR, is a measure of our discounted cash flows (inflows and outflows). Specifically, IRR is the discount rate at which the net present value of all cash flows is equal to zero. That is, IRR is the discount rate at which the present value of total capital invested in each of our investments is equal to the present value of all realized returns from that investment. Our IRR calculations are unaudited.

Capital invested, with respect to an investment, represents the aggregate cost basis allocable to the realized or unrealized portion of the investment, net of any upfront fees paid at closing for the term loan portion of the investment.

Realized returns, with respect to an investment, represents the total cash received with respect to each investment, including all amortization payments, interest, dividends, prepayment fees, upfront fees (except upfront fees paid at closing for the term loan portion of an investment), administrative fees, agent fees, amendment fees, accrued interest, and other fees and proceeds.

Gross IRR, with respect to an investment, is calculated based on the dates that we invested capital and dates we received distributions, regardless of when we made distributions to our shareholders. Initial investments are assumed to occur at time zero.

Gross IRR reflects historical results relating to our past performance and is not necessarily indicative of our future results. In addition, gross IRR does not reflect the effect of management fees, expenses, incentive fees or taxes borne, or to be borne, by us or our shareholders, and would be lower if it did.

Aggregate cash flow realized gross IRR on our exited investments reflects only invested and realized cash amounts as described above, and does not reflect any unrealized gains or losses in our portfolio.

Financial Condition, Liquidity and Capital Resources

Our liquidity and capital resources are generated primarily from cash flows from interest, dividends and fees earned from our investments and principal repayments, our credit facilities, debt securitization transactions, and other secured and unsecured debt. We

98


 

may also generate cash flow from operations, future borrowings and future offerings of securities including public and/or private issuances of debt and/or equity securities through both registered offerings off of our shelf registration statement and private offerings. The primary uses of our cash are (i) investments in portfolio companies and other investments and to comply with certain portfolio diversification requirements, (ii) the cost of operations (including paying or reimbursing our Adviser), (iii) debt service, repayment and other financing costs of any borrowings and (iv) cash distributions to the holders of our shares.

We may from time to time enter into additional debt facilities, increase the size of our existing credit facilities, enter into additional debt securitization transactions, or issue additional debt securities. Any such incurrence or issuance would be subject to prevailing market conditions, our liquidity requirements, contractual and regulatory restrictions and other factors. In accordance with the 1940 Act, with certain limited exceptions, we are only allowed to incur borrowings, issue debt securities or issue preferred stock, if immediately after the borrowing or issuance, the ratio of total assets (less total liabilities other than indebtedness) to total indebtedness plus preferred stock, is at least 150%. Our current target ratio is 0.90x-1.25x.

As of March 31, 2021 and December 31, 2020, our asset coverage ratio was 202% and 206%, respectively. We seek to carefully consider our unfunded commitments for the purpose of planning our ongoing financial leverage. Further, we maintain sufficient borrowing capacity within the 150% asset coverage limitation to cover any outstanding unfunded commitments we are required to fund.

Cash and restricted cash as of March 31, 2021, taken together with our available debt, is expected to be sufficient for our investing activities and to conduct our operations in the near term. As of March 31, 2021, we had $1.4 billion available under our credit facilities.

As of March 31, 2021, we had $255.3 million in cash and restricted cash. During the three months ended March 31, 2021, we used $0.2 billion in cash for operating activities, primarily as a result of funding portfolio investments of $1.0 billion, partially offset by sell downs and repayments of $0.6 billion and other operating activity of $0.2 billion. Lastly, cash provided by financing activities was $0.1 billion during the period, which was the result of net borrowings on our credit facilities of $0.2 billion, partially offset by distributions paid of $0.1 billion.

Equity

IPO, Subscriptions and Drawdowns

We have the authority to issue 500,000,000 common shares at $0.01 per share par value.

On July 22, 2019, we closed our initial public offering (“IPO”), issuing 10 million shares of our common stock at a public offering price of $15.30 per share, and on August 2, 2019, the underwriters exercised their option to purchase an additional 1.5 million shares of common stock at a purchase price of $15.30 per share.  Net of underwriting fees and offering costs, we received total cash proceeds of $164.0 million. Our common stock began trading on the New York Stock Exchange (“NYSE”) under the symbol “ORCC” on July 18, 2019.

On July 7, 2019, our Board of Directors determined to eliminate any outstanding fractional shares of our common stock (the “Fractional Shares”), as permitted by the Maryland General Corporation Law and on July 8, 2019, we eliminated such Fractional Shares by rounding down the number of Fractional Shares held by each shareholder to the nearest whole share and paying each shareholder cash for such Fractional Shares based on a price of $15.27 per whole share.

Prior to March 2, 2018, we entered into subscription agreements (the “Subscription Agreements”) with investors providing for the private placement of our common shares. Under the terms of the Subscription Agreements, investors were required to fund drawdowns to purchase our common shares up to the amount of their respective Capital Commitment on an as-needed basis each time we delivered a drawdown notice to our investors. As of June 4, 2019, all Capital Commitments had been drawn.

On March 1, 2016, we issued 100 common shares for $1,500 to the Adviser.

      Distributions

The following table reflects the distributions declared on shares of our common stock during the three months ended March 31, 2021:

 

 

 

March 31, 2021

 

Date Declared

 

Record Date

 

Payment Date

 

Distribution per Share

 

February 23, 2021

 

March 31, 2021

 

May 14, 2021

 

$

0.31

 

 

On May 5, 2021, the Board declared a distribution of $0.31 per share for shareholders of record on June 30, 2021 payable on or before August 13, 2021.

99


 

During certain periods, our distributions may exceed our earnings. As a result, it is possible that a portion of the distributions we make may represent a return of capital. A return of capital generally is a return of a shareholder’s investment rather than a return of earnings or gains derived from our investment activities. Each year, a statement on Form 1099-DIV identifying the tax character of the distributions will be mailed to our shareholders. The tax character of the distributions are not determined until the Company’s taxable year end.

 

Based on our pipeline of transactions and our expected pace of repayments, we expect our leverage and earnings to increase and to be brought in line with our quarterly dividend over time.

 

The following table reflects the distributions declared on shares of our common stock during the three months ended March 31, 2020:

 

 

 

March 31, 2020

 

Date Declared

 

Record Date

 

Payment Date

 

Distribution per Share

 

February 19, 2020

 

March 31, 2020

 

May 15, 2020

 

$

0.31

 

May 28, 2019 (special dividend)

 

March 31, 2020

 

May 15, 2020

 

$

0.08

 

 

Dividend Reinvestment

We have adopted a dividend reinvestment plan, pursuant to which we will reinvest all cash distributions declared by the Board on behalf of our shareholders who do not elect to receive their distribution in cash as provided below. As a result, if the Board authorizes, and we declare, a cash dividend or other distribution, then our shareholders who have not opted out of our dividend reinvestment plan will have their cash distributions automatically reinvested in additional shares of our common stock as described below, rather than receiving the cash dividend or other distribution. Any fractional share otherwise issuable to a participant in the dividend reinvestment plan will instead be paid in cash.

In connection with our IPO, we entered into our second amended and restated dividend reinvestment plan, pursuant to which, if newly issued shares are used to implement the dividend reinvestment plan, the number of shares to be issued to a shareholder will be determined by dividing the total dollar amount of the cash dividend or distribution payable to a shareholder by the market price per share of our common stock at the close of regular trading on the New York Stock Exchange on the payment date of a distribution, or if no sale is reported for such day, the average of the reported bid and ask prices. However, if the market price per share on the payment date of a cash dividend or distribution exceeds the most recently computed net asset value per share, we will issue shares at the greater of (i) the most recently computed net asset value per share and (ii) 95% of the current market price per share (or such lesser discount to the current market price per share that still exceeded the most recently computed net asset value per share). For example, if the most recently computed net asset value per share is $15.00 and the market price on the payment date of a cash dividend is $14.00 per share, we will issue shares at $14.00 per share. If the most recently computed net asset value per share is $15.00 and the market price on the payment date of a cash dividend is $16.00 per share, we will issue shares at $15.20 per share (95% of the current market price). If the most recently computed net asset value per share is $15.00 and the market price on the payment date of a cash dividend is $15.50 per share, we will issue shares at $15.00 per share, as net asset value is greater than 95% ($14.73 per share) of the current market price. Pursuant to our second amended and restated dividend reinvestment plan, if shares are purchased in the open market to implement the dividend reinvestment plan, the number of shares to be issued to a shareholder shall be determined by dividing the dollar amount of the cash dividend payable to such shareholder by the weighted average price per share for all shares purchased by the plan administrator in the open market in connection with the dividend. Shareholders who receive distributions in the form of shares of common stock will be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions.

The following table reflects the common stock issued pursuant to the dividend reinvestment plan during the three months ended March 31, 2021:

 

Date Declared

 

Record Date

 

Payment Date

 

Shares

 

November 4, 2020

 

December 31, 2020

 

January 19, 2021

 

 

1,435,099

 

 

The following table reflects the common stock issued pursuant to the dividend reinvestment plan during the three months ended March 31, 2020:

 

Date Declared

 

Record Date

 

Payment Date

 

Shares

 

October 30, 2019

 

December 31, 2019

 

January 31, 2020

 

 

2,823,048

 

 

 

100


 

 

Stock Repurchase Plans

 

On July 7, 2019, our Board approved a stock repurchase plan (the “Company 10b5-1 Plan”), to acquire up to $150 million in the aggregate of our common stock at prices below our net asset value per share over a specified period, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the Exchange Act. The Company 10b5-1 Plan commenced on August 19, 2019 and was exhausted on August 4, 2020.

The Company 10b5-1 Plan was intended to allow us to repurchase our common stock at times when we otherwise might be prevented from doing so under insider trading laws. The Company 10b5-1 Plan required Goldman Sachs & Co. LLC, as our agent, to repurchase shares of common stock on our behalf when the market price per share was below the most recently reported net asset value per share (including any updates, corrections or adjustments publicly announced by us to any previously announced net asset value per share). Under the Company 10b5-1 Plan, the agent would increase the volume of purchases made as the price of our common stock declined, subject to volume restrictions.

The purchase of shares pursuant to the Company 10b5-1 Plan was intended to satisfy the conditions of Rule 10b5-1 and Rule 10b-18 under the Exchange Act, and will otherwise be subject to applicable law, including Regulation M, which may prohibit purchases under certain circumstances.

The following table provides information regarding purchases of our common stock by Goldman, Sachs & Co., as agent, pursuant to the 10b5-1 plan for each month in the year ended December 31, 2020:

 

Period

($ in millions, except share and per share amounts)

 

Total Number

of Shares

Repurchased

 

 

Average Price Paid per Share

 

 

Approximate

Dollar Value of

Shares that have been

Purchased Under

the Plans

 

 

Approximate

Dollar Value

of Shares that

May Yet Be

Purchased Under

the Plan

 

January 1, 2020 - January 31, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

150.0

 

February 1, 2020 - February 29, 2020

 

 

87,328

 

 

$

15.17

 

 

$

1.4

 

 

$

148.6

 

March 1, 2020 - March 31, 2020

 

 

4,009,218

 

 

$

12.46

 

 

$

46.6

 

 

$

102.0

 

April 1, 2020 - April 30, 2020

 

 

6,235,497

 

 

$

11.95

 

 

$

74.3

 

 

$

27.7

 

May 1, 2020 - May 31, 2020

 

 

2,183,581

 

 

$

12.76

 

 

$

27.7

 

 

$

-

 

June 1, 2020 - June 30, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

-

 

July 1, 2020 - July 31, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

-

 

August 1, 2020 - August 31, 2020

 

 

-

 

 

$

-

 

 

$

-

 

 

$

-

 

Total

 

 

12,515,624

 

 

 

 

 

 

$

150.0

 

 

 

 

 

 

On November 3, 2020, the Board approved a repurchase program (the “Repurchase Plan”) under which we may repurchase up to $100 million of our outstanding common stock. Under the program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities laws and regulations. Unless extended by the Board, the repurchase program will terminate 12-months from the date it was approved. As of March 31, 2021, no repurchases were made under the Repurchase Plan.

101


 

Debt

Aggregate Borrowings

Debt obligations consisted of the following as of March 31, 2021 and December 31, 2020:

 

 

 

March 31, 2021

 

($ in thousands)

 

Aggregate Principal Committed

 

 

Outstanding Principal

 

 

Amount Available(1)

 

 

Net Carrying Value(2)

 

Revolving Credit Facility(3)(5)

 

$

1,455,000

 

 

$

553,461

 

 

$

870,258

 

 

$

544,193

 

SPV Asset Facility II

 

 

350,000

 

 

 

100,000

 

 

 

250,000

 

 

 

95,829

 

SPV Asset Facility III

 

 

500,000

 

 

 

375,000

 

 

 

125,000

 

 

 

373,650

 

SPV Asset Facility IV

 

 

450,000

 

 

 

250,000

 

 

 

200,000

 

 

 

246,738

 

CLO I

 

 

390,000

 

 

 

390,000

 

 

 

 

 

 

386,780

 

CLO II

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,741

 

CLO III

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,791

 

CLO IV

 

 

252,000

 

 

 

252,000

 

 

 

 

 

 

247,852

 

CLO V

 

 

196,000

 

 

 

196,000

 

 

 

 

 

 

194,014

 

2023 Notes(4)

 

 

150,000

 

 

 

150,000

 

 

 

 

 

 

151,236

 

2024 Notes(4)

 

 

400,000

 

 

 

400,000

 

 

 

 

 

 

413,919

 

2025 Notes

 

 

425,000

 

 

 

425,000

 

 

 

 

 

 

418,519

 

July 2025 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

492,495

 

2026 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

489,662

 

July 2026 Notes

 

 

1,000,000

 

 

 

1,000,000

 

 

 

 

 

 

975,472

 

Total Debt

 

$

7,088,000

 

 

$

5,611,461

 

 

$

1,445,258

 

 

$

5,545,891

 

________________

 

(1)

The amount available reflects any limitations related to each credit facility’s borrowing base.

 

(2)

The carrying value of our Revolving Credit Facility, SPV Asset Facility II, SPV Asset Facility III, SPV Asset Facility IV, CLO I, CLO II, CLO III, CLO IV, CLO V, 2023 Notes, 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026 Notes are presented net of deferred financing costs of $9.3 million, $4.2 million, $1.4 million, $3.3 million, $3.2 million, $2.3 million, $2.2 million, $4.1 million, $2.0 million, $0.9 million, $6.5 million, $6.5 million, $7.5 million, $10.3 million and $24.5 million, respectively.

 

(3)

Includes the unrealized translation gain (loss) on borrowings denominated in foreign currencies.

 

(4)

Inclusive of change in fair market value of effective hedge.

 

(5)

The amount available is reduced by $31.3 million of outstanding letters of credit.  

102


 

 

 

 

 

December 31, 2020

 

($ in thousands)

 

Aggregate Principal Committed

 

 

Outstanding Principal

 

 

Amount Available(1)

 

 

Net Carrying Value(2)

 

Revolving Credit Facility(3)(5)

 

$

1,355,000

 

 

$

252,525

 

 

$

1,075,636

 

 

$

243,143

 

SPV Asset Facility II

 

 

350,000

 

 

 

100,000

 

 

 

250,000

 

 

 

95,654

 

SPV Asset Facility III

 

 

500,000

 

 

 

375,000

 

 

 

125,000

 

 

 

373,238

 

SPV Asset Facility IV

 

 

450,000

 

 

 

295,000

 

 

 

155,000

 

 

 

291,644

 

CLO I

 

 

390,000

 

 

 

390,000

 

 

 

 

 

 

386,708

 

CLO II

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,686

 

CLO III

 

 

260,000

 

 

 

260,000

 

 

 

 

 

 

257,744

 

CLO IV

 

 

252,000

 

 

 

252,000

 

 

 

 

 

 

247,745

 

CLO V

 

 

196,000

 

 

 

196,000

 

 

 

 

 

 

194,128

 

2023 Notes(4)

 

 

150,000

 

 

 

150,000

 

 

 

 

 

 

151,889

 

2024 Notes(4)

 

 

400,000

 

 

 

400,000

 

 

 

 

 

 

418,372

 

2025 Notes

 

 

425,000

 

 

 

425,000

 

 

 

 

 

 

418,154

 

July 2025 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

492,095

 

2026 Notes

 

 

500,000

 

 

 

500,000

 

 

 

 

 

 

489,176

 

July 2026 Notes

 

 

1,000,000

 

 

 

1,000,000

 

 

 

 

 

 

975,346

 

Total Debt

 

$

6,988,000

 

 

$

5,355,525

 

 

$

1,605,636

 

 

$

5,292,722

 

________________

 

(1)

The amount available reflects any limitations related to each credit facility’s borrowing base.

 

(2)

The carrying value of our Revolving Credit Facility, SPV Asset Facility II, SPV Asset Facility III, SPV Asset Facility IV, CLO I, CLO II, CLO III, CLO IV, CLO V, 2023 Notes, 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026 Notes are presented net of deferred financing costs of $9.4 million, $4.2 million, $1.8 million, $3.4 million, $3.3 million, $2.3 million, $2.3 million, $4.3 million, $1.9 million, $1.0 million, $7.0 million, $6.8 million, $7.9 million, $10.8 million, $24.7 million respectively.

 

(3)

respectively.Includes the unrealized translation gain (loss) on borrowings denominated in foreign currencies.

 

(4)

Inclusive of change in fair market value of effective hedge.

 

(5)

The amount available is reduced by $26.8 million of outstanding letters of credit.

 

For the three months ended March 31, 2021 and 2020, the components of interest expense were as follows:

 

 

 

For the Three Months Ended March 31,

($ in thousands)

 

2021

 

 

2020

 

 

Interest expense

 

$

43,138

 

 

$

33,582

 

 

Amortization of debt issuance costs

 

 

4,946

 

 

 

3,170

 

 

Net change in unrealized gain (loss) on effective

     interest rate swaps and hedged items(1)

 

 

(8

)

 

 

(2,795

)

 

Total Interest Expense

 

$

48,076

 

 

$

33,957

 

 

Average interest rate

 

 

3.2

 

%

 

4.2

 

%

Average daily borrowings

 

$

5,330,364

 

 

$

3,184,613

 

 

________________

 

(1)

Refer to “ITEM 1. – FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA – Notes to Consolidated Financial Statements – Note 6. Debt – 2023 Notes and 2024 Notes” for details on each facility’s interest rate swap.

 

103


 

 

Senior Securities

 

Information about our senior securities is shown in the following table as of March 31, 2021 and the fiscal years ended December 31, 2020, 2019, 2018, 2017 and 2016.

 

Class and Period

 

Total Amount Outstanding Exclusive of Treasury Securities(1)

($ in millions)

 

 

Asset Coverage per Unit(2)

 

 

Involuntary Liquidating Preference per Unit(3)

 

 

Average Market Value per Unit(4)

 

Revolving Credit Facility

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

553.5

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

252.5

 

 

$

2,060

 

 

 

 

 

N/A

 

December 31, 2019

 

$

480.9

 

 

$

2,926

 

 

 

 

 

N/A

 

December 31, 2018

 

$

308.6

 

 

$

2,254

 

 

 

 

 

N/A

 

December 31, 2017

 

$

 

 

$

2,580

 

 

 

 

 

N/A

 

SPV Asset Facility I(6)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2020

 

$

 

 

$

 

 

 

 

 

N/A

 

December 31, 2019

 

$

300.0

 

 

$

2,926

 

 

 

 

 

N/A

 

December 31, 2018

 

$

400.0

 

 

$

2,254

 

 

 

 

 

N/A

 

December 31, 2017

 

$

400.0

 

 

$

2,580

 

 

 

 

 

N/A

 

SPV Asset Facility II

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

100.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

100.0

 

 

$

2,060

 

 

 

 

 

N/A

 

December 31, 2019

 

$

350.0

 

 

$

2,926

 

 

 

 

 

N/A

 

December 31, 2018

 

$

550.0

 

 

$

2,254

 

 

 

 

 

N/A

 

SPV Asset Facility III

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

375.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

375.0

 

 

$

2,060

 

 

 

 

 

N/A

 

December 31, 2019

 

$

255.0

 

 

$

2,926

 

 

 

 

 

N/A

 

December 31, 2018

 

$

300.0

 

 

$

2,254

 

 

 

 

 

N/A

 

SPV Asset Facility IV

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

250.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

295.0

 

 

$

2,060

 

 

 

 

 

N/A

 

December 31, 2019

 

$

60.3

 

 

$

2,926

 

 

 

 

 

N/A

 

CLO I

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

390.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

390.0

 

 

$

2,060

 

 

 

 

 

N/A

 

December 31, 2019

 

$

390.0

 

 

$

2,926

 

 

 

 

 

N/A

 

CLO II

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

260.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

260.0

 

 

$

2,060

 

 

 

 

 

N/A

 

December 31, 2019

 

$

260.0

 

 

$

2,926

 

 

 

 

 

N/A

 

CLO III

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

260.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

260.0

 

 

$

2,060

 

 

 

 

 

N/A

 

CLO IV

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

252.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

252.0

 

 

$

2,060

 

 

 

 

 

N/A

 

CLO V

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

196.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

196.0

 

 

$

2,060

 

 

 

 

 

N/A

 

104


 

Class and Period

 

Total Amount Outstanding Exclusive of Treasury Securities(1)

($ in millions)

 

 

Asset Coverage per Unit(2)

 

 

Involuntary Liquidating Preference per Unit(3)

 

 

Average Market Value per Unit(4)

 

Subscription Credit Facility(5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2019

 

$

 

 

$

 

 

 

 

 

N/A

 

December 31, 2018

 

$

883.0

 

 

$

2,254

 

 

 

 

 

N/A

 

December 31, 2017

 

$

393.5

 

 

$

2,580

 

 

 

 

 

N/A

 

December 31, 2016

 

$

495.0

 

 

$

2,375

 

 

 

 

 

N/A

 

2023 Notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

150.0

 

 

$

2,024

 

 

 

 

 

N/A

 

December 31, 2020

 

$

150.0

 

 

$

2,060

 

 

 

 

 

N/A

 

December 31, 2019

 

$

150.0

 

 

$

2,926

 

 

 

 

 

N/A

 

December 31, 2018

 

$

150.0

 

 

$

2,254

 

 

 

 

 

N/A

 

December 31, 2017

 

$

138.5

 

 

$

2,580

 

 

 

 

 

N/A

 

2024 Notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

400.0

 

 

$

2,024

 

 

 

 

 

$

1,091.2

 

December 31, 2020

 

$

400.0

 

 

$

2,060

 

 

 

 

 

$

1,037.1

 

December 31, 2019

 

$

400.0

 

 

$

2,926

 

 

 

 

 

$

1,039.3

 

2025 Notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

425.0

 

 

$

2,024

 

 

 

 

 

$

1,050.9

 

December 31, 2020

 

$

425.0

 

 

$

2,060

 

 

 

 

 

$

984.2

 

December 31, 2019

 

$

425.0

 

 

$

2,926

 

 

 

 

 

$

997.9

 

July 2025 Notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

500.0

 

 

$

2,024

 

 

 

 

 

$

1,041.8

 

December 31, 2020

 

$

500.0

 

 

$

2,060

 

 

 

 

 

$

971.1

 

2026 Notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

500.0

 

 

$

2,024

 

 

 

 

 

$

1,060.4

 

December 31, 2020

 

$

500.0

 

 

$

2,060

 

 

 

 

 

$

1,018.5

 

July 2026 Notes

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

March 31, 2021 (unaudited)

 

$

1,000.0

 

 

$

2,024

 

 

 

 

 

$

1,023.0

 

December 31, 2020

 

$

1,000.0

 

 

$

2,060

 

 

 

 

 

$

1,005.0

 

 

________________

 

(1)

Total amount of each class of senior securities outstanding at the end of the period presented.

 

(2)

Asset coverage per unit is the ratio of the carrying value of our total assets, less all liabilities excluding indebtedness represented by senior securities in this table, to the aggregate amount of senior securities representing indebtedness. Asset coverage per unit is expressed in terms of dollar amounts per $1,000 of indebtedness and is calculated on a consolidated basis.

 

(3)

The amount to which such class of senior security would be entitled upon our involuntary liquidation in preference to any security junior to it. The “—" in this column indicates information that the SEC expressly does not require to be disclosed for certain types of senior securities.

 

(4)

Not applicable, except for with respect to the 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes and July 2026 Notes as other senior securities are not registered for public trading on a stock exchange. The average market value per unit for each of the 2024 Notes, 2025 Notes, July 2025 Notes, 2026 Notes, and July 2026 Notes is based on the average daily prices of such notes and is expressed per $1,000 of indebtedness.

 

(5)

Facility was terminated in 2019.

 

(6)

Facility was terminated in 2020.

 

105


 

 

Credit Facilities

Our credit facilities contain customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events, and customary events of default (with customary cure and notice provisions).

Revolving Credit Facility

On February 1, 2017, we entered into a senior secured revolving credit agreement (and as amended by that certain First Amendment to Senior Secured Revolving Credit Agreement, dated as of July 17, 2017, the First Omnibus Amendment to Senior Secured Revolving Credit Agreement and Guarantee and Security Agreement, dated as of March 29, 2018, the Third Amendment to Senior Secured Revolving Credit Agreement, dated as of June 21, 2018, the Fourth Amendment to Senior Secured Revolving Credit Agreement, dated as of April 2, 2019, the Fifth Amendment to Senior Secured Revolving Credit Agreement, dated as of May 7, 2020, and the Sixth Amendment to Senior Secured Revolving Credit Agreement, dated as of September 3, 2020, the “Revolving Credit Facility”). The parties to the Revolving Credit Facility include us, as Borrower, the lenders from time to time parties thereto (each a “Lender” and collectively, the “Lenders”) and Truist Securities, Inc. and ING Capital LLC as Joint Lead Arrangers and Joint Book Runners, Truist Bank (as successor by merger to SunTrust Bank) as Administrative Agent and ING Capital LLC as Syndication Agent.

The Revolving Credit Facility is guaranteed by OR Lending LLC, our subsidiary, and will be guaranteed by certain domestic subsidiaries of ours that are formed or acquired by us in the future (collectively, the “Guarantors”). Proceeds of the Revolving Credit Facility may be used for general corporate purposes, including the funding of portfolio investments.

 

 The maximum principal amount of the Revolving Credit Facility is $1.46 billion, subject to availability under the borrowing base, which is based on our portfolio investments and other outstanding indebtedness. As amended on September 3, 2020, maximum capacity under the Revolving Credit Facility may be increased to $2.0 billion through our exercise of an uncommitted accordion feature through which existing and new lenders may, at their option, agree to provide additional financing. The Revolving Credit Facility includes a $50 million limit for swingline loans and is secured by a perfected first-priority interest in substantially all of the portfolio investments held by us and each Guarantor, subject to certain exceptions.

The availability period under the Revolving Credit Facility will terminate on September 3, 2024, with respect to $1.295 billion of commitments, and on March 31, 2023, which respect to the remaining commitments (together, the “Revolving Credit Facility Commitment Termination Date”). The Revolving Credit Facility will mature on September 3, 2025, with respect to 1.295 billion of commitments, and on April 2, 2024, with respect to the remaining commitments (together, the “Revolving Credit Facility Maturity Date”). During the period from the earliest Revolving Credit Facility Commitment Termination Date to the final Revolving Credit Facility Maturity Date, we will be obligated to make mandatory prepayments under the Revolving Credit Facility out of the proceeds of certain asset sales and other recovery events and equity and debt issuances.

We may borrow amounts in U.S. dollars or certain other permitted currencies. Amounts drawn under the Revolving Credit Facility will bear interest at either LIBOR plus 2.00%, or the prime rate plus 1.00%. We may elect either the LIBOR or prime rate at the time of drawdown, and loans may be converted from one rate to another at any time at our option, subject to certain conditions. We predominantly borrow utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. We also pay a fee of 0.375% on undrawn amounts under the Revolving Credit Facility.

The Revolving Credit Facility includes customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events and certain financial covenants related to asset coverage and liquidity and other maintenance covenants, as well as customary events of default. The agreement requires a minimum asset coverage ratio of 150% with respect to our consolidated assets and our subsidiaries, measured at the last day of any fiscal quarter and a minimum asset coverage ratio of no less than 200% with respect to our consolidated assets and our subsidiary guarantors (including certain limitations on the contribution of equity in financing subsidiaries as specified therein) to our secured debt and our subsidiary guarantors (the “Obligor Asset Coverage Ratio”), measured at the last day of each fiscal quarter. The agreement concentration limits in connection with the calculation of the borrowing base, based upon the Obligor Asset Coverage Ratio.

Subscription Credit Facility

On August 1, 2016, we entered into a subscription credit facility (as amended, the “Subscription Credit Facility”) with Wells Fargo Bank, National Association (“Wells Fargo”), as administrative agent (the “Subscription Credit Facility Administrative Agent”) and letter of credit issuer, and Wells Fargo, State Street Bank and Trust Company and the banks and financial institutions from time to time party thereto, as lenders.  

The Subscription Credit Facility permitted us to borrow up to $900 million, subject to availability under the borrowing base which is calculated based on the unused Capital Commitments of the investors meeting various eligibility requirements. Effective June

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19, 2019, the outstanding balance of the Subscription Credit Facility was paid in full and the facility was terminated pursuant to its terms.

Borrowings under the Subscription Credit Facility bore interest, at our election at the time of drawdown, at a rate per annum equal to (i) in the case of LIBOR rate loans, an adjusted LIBOR rate for the applicable interest period plus 1.60% or (ii) in the case of reference rate loans, the greatest of (A) a prime rate plus 0.60%, (B) the federal funds rate plus 1.10%, and (C) one-month LIBOR plus 1.60%.  Loans may have been converted from one rate to another at any time at our election, subject to certain conditions.  We predominantly borrowed utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. We paid an unused commitment fee of 0.25% per annum on the unused commitments.

SPV Asset Facilities

Certain of our wholly owned subsidiaries are parties to credit facilities (the “SPV Asset Facilities”).  Pursuant to the SPV Asset Facilities, we sell and contribute certain investments to these wholly owned subsidiaries pursuant to sale and contribution agreements by and between us and the wholly owned subsidiaries. No gain or loss is recognized as a result of these contributions. Proceeds from the SPV Asset Facilities are used to finance the origination and acquisition of eligible assets by the wholly owned subsidiary, including the purchase of such assets from us. We retain a residual interest in assets contributed to or acquired to the wholly owned subsidiary through our ownership of the wholly owned subsidiary.

The SPV Asset Facilities are secured by a perfected first priority security interest in the assets of these wholly owned subsidiaries and on any payments received by such wholly owned subsidiaries in respect of those assets. Assets pledged to lenders under the SPV Asset Facilities will not be available to pay our debts.

The SPV Asset Facilities contain customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events, and customary events of default (with customary cure and notice provisions).

SPV Asset Facility I

On December 21, 2017 (the “SPV Asset Facility I Closing Date”), ORCC Financing LLC (“ORCC Financing”), a Delaware limited liability company and our subsidiary, entered into a Loan and Servicing Agreement (as amended, the “SPV Asset Facility I”), with ORCC Financing as Borrower, us as Transferor and Servicer, the lenders from time to time parties thereto (the “SPV Lenders”), Morgan Stanley Asset Funding Inc. as Administrative Agent, State Street Bank and Trust Company as Collateral Agent and Cortland Capital Market Services LLC as Collateral Custodian.

From time to time, we sold and contributed certain investments to ORCC Financing pursuant to a Sale and Contribution Agreement by and between us and ORCC Financing. No gain or loss was recognized as a result of the contribution. Proceeds from the SPV Asset Facility I were used to finance the origination and acquisition of eligible assets by ORCC Financing, including the purchase of such assets from us. We retained a residual interest in assets contributed to or acquired by ORCC Financing through its ownership of ORCC Financing. The maximum principal amount of the SPV Asset Facility I was $400 million; the availability of this amount was subject to a borrowing base test, which was based on the value of ORCC Financing’s assets from time to time, and satisfaction of certain conditions, including certain concentration limits.

The SPV Asset Facility I provided for the ability to draw and redraw amounts under the SPV Asset Facility I for a period of up to three years after the SPV Asset Facility I Closing Date (the “SPV Asset Facility I Commitment Termination Date”). The SPV Asset Facility I was terminated on June 2, 2020 (the “SPV Asset Facility I Termination Date”). Prior to the SPV Asset Facility I Termination Date, proceeds received by ORCC Financing from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to us, subject to certain conditions. On the SPV Asset Facility I Termination Date, ORCC Financing repaid in full all outstanding fees and expenses and all principal and interest on outstanding borrowings.

Amounts drawn bore interest at LIBOR plus a spread of 2.25% until the six-month anniversary of the SPV Asset Facility I Closing Date, increasing to 2.50% thereafter, until the SPV Asset Facility I Commitment Termination Date. We predominantly borrowed utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. After a ramp-up period, there was an unused fee of 0.75% per annum on the amount, if any, by which the undrawn amount under the SPV Asset Facility I exceeded 25% of the maximum principal amount of the SPV Asset Facility I. The SPV Asset Facility I contained customary covenants, including certain financial maintenance covenants, limitations on the activities of ORCC Financing, including limitations on incurrence of incremental indebtedness, and customary events of default. The SPV Asset Facility I was secured by a perfected first priority security interest in the assets of ORCC Financing and on any payments received by ORCC Financing in respect of those assets. Assets pledged to the SPV Lenders were not available to pay our debts.

SPV Asset Facility II

On May 22, 2018, our subsidiary, ORCC Financing II LLC (“ORCC Financing II”), a Delaware limited liability company and our subsidiary, entered into a Credit Agreement (as amended, the “SPV Asset Facility II”), with ORCC Financing II, as Borrower, the

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lenders from time to time parties thereto, Natixis, New York Branch, as Administrative Agent, State Street Bank and Trust Company, as Collateral Agent, and Cortland Capital Market Services LLC as Document Custodian. The parties to the SPV Asset Facility II have entered into various amendments, including to admit new lenders, increase or decrease the maximum principal amount available under the facility, extend the availability period and maturity date, change the interest rate and make various other changes.  The following describes the terms of SPV Asset Facility II amended through March 17, 2020 (the “SPV Asset Facility II Fifth Amendment Date”).

The maximum principal amount of the SPV Asset Facility II following the SPV Asset Facility II Fifth Amendment Date is $350 million (which includes terms loans of $100 million and revolving commitments of $250 million); the availability of this amount is subject to an overcollateralization ratio test, which is based on the value of ORCC Financing II’s assets from time to time, and satisfaction of certain conditions, including an interest coverage ratio test, certain concentration limits and collateral quality tests.

The SPV Asset Facility II provides for the ability to (1) draw term loans and (2) draw and redraw revolving loans under the SPV Asset Facility II for a period of up to 18 months after SPV Asset Facility II Fifth Amendment Date unless the revolving commitments are terminated or converted to term loans sooner as provided in the SPV Asset Facility II (the “SPV Asset Facility II Commitment Termination Date”). Unless otherwise terminated, the SPV Asset Facility II will mature on May 22, 2028 (the "SPV Assert Facility II Stated Maturity"). Prior to the SPV Asset Facility II Stated Maturity, proceeds received by ORCC Financing II from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to us, subject to certain conditions. On October 10, 2026, ORCC Financing II must pay in full all outstanding fees and expenses and all principal and interest on outstanding borrowings, and the excess may be returned to us.

With respect to revolving loans, amounts drawn bear interest at LIBOR (or, in the case of certain lenders that are commercial paper conduits, the lower of their cost of funds and LIBOR plus 0.25%) plus a spread that steps up from 2.20% to 2.50% during the period from the SPV Asset Facility II Fifth Amendment Date to the six month anniversary of the Reinvestment Period End Date. With respect to term loans, amounts drawn bear interest at LIBOR (or, in the case of certain lenders that are commercial paper conduits, the lower of their cost of funds and LIBOR plus 0.25%)  plus a spread that steps up from 2.25% to 2.55% during the same period. We predominantly borrow utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. From the SPV Asset Facility II Fifth Amendment Date to the SPV Asset Facility II Commitment Termination Date, there is a commitment fee ranging from 0.50% to 0.75% per annum on the undrawn amount, if any, of the revolving commitments in the SPV Asset Facility II. For further details, see “ITEM 8. – Notes to Consolidated Financial Statements – Note 6. Debt.”

SPV Asset Facility III

On December 14, 2018, ORCC Financing III LLC (“ORCC Financing III”), a Delaware limited liability company and our subsidiary, entered into a Loan Financing and Servicing Agreement (the “SPV Asset Facility III”), with ORCC Financing III, as borrower, ourselves, as equity holder and services provider, the lenders from time to time parties thereto, Deutsche Bank AG, New York Branch, as Facility Agent, State Street Bank and Trust Company, as Collateral Agent and Cortland Capital Market Services LLC, as Collateral Custodian. The parties to the SPV Asset Facility III have entered into various amendments, including those relating to the undrawn fee and make-whole fee and definition of “Change of Control.” The following describes the terms of SPV Asset Facility III as amended through March 17, 2021.

The maximum principal amount of the SPV Asset Facility III is $500 million; the availability of this amount is subject to a borrowing base test, which is based on the value of ORCC Financing III’s assets from time to time, and satisfaction of certain conditions, including interest spread and weighted average coupon tests, certain concentration limits and collateral quality tests.

The SPV Asset Facility III provides for the ability to borrow, reborrow, repay and prepay advances under the SPV Asset Facility III for a period of up to three years after December 14, 2018 unless such period is extended or accelerated under the terms of the SPV Asset Facility III (the “SPV Asset Facility III Revolving Period”).  Unless otherwise extended, accelerated or terminated under the terms of the SPV Asset Facility III, the SPV Asset Facility III will mature on the date that is two years after the last day of the SPV Asset Facility III Revolving Period (the “SPV Asset Facility III Stated Maturity”).  Prior to the SPV Asset Facility III Stated Maturity, proceeds received by ORCC Financing III from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding advances, and the excess may be returned to us, subject to certain conditions.  On the SPV Asset Facility III Stated Maturity, ORCC Financing III must pay in full all outstanding fees and expenses and all principal and interest on outstanding advances, and the excess may be returned to us.

Amounts drawn bear interest at LIBOR (or, in the case of certain SPV Lenders III that are commercial paper conduits, the lower of (a) their cost of funds and (b) LIBOR, such LIBOR not to be lower than zero) plus a spread equal to 2.20% per annum, which spread will increase (a) on and after the end of the SPV Asset Facility III Revolving Period by 0.15% per annum if no event of default has occurred and (b) by 2.00% per annum upon the occurrence of an event of default (such spread, the “Applicable Margin”).  LIBOR may be replaced as a base rate under certain circumstances. We predominantly borrow utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. During the Revolving Period, ORCC Financing III will pay an undrawn fee ranging from 0.25% to 0.50% per annum on the undrawn amount, if any, of the revolving commitments in the SPV Asset Facility III.  During the Revolving Period, if the undrawn commitments are in excess of a certain portion (initially 20% and increasing in stages to 75%) of the total commitments under the SPV Asset Facility III, ORCC Financing III will also pay a make-whole fee equal to the Applicable

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Margin multiplied by such excess undrawn commitment amount, reduced by the undrawn fee payable on such excess.  For further details, see “ITEM 8. – Notes to Consolidated Financial Statements – Note 6. Debt. “Unsecured Notes.”

SPV Asset Facility IV

On August 2, 2019 (the “SPV Asset Facility IV Closing Date”), ORCC Financing IV LLC (“ORCC Financing IV”), a Delaware limited liability company and newly formed subsidiary, entered into a Credit Agreement (the “SPV Asset Facility IV”), with ORCC Financing IV, as borrower, Société Générale, as initial Lender and as Administrative Agent, State Street Bank and Trust Company, as Collateral Agent, Collateral Administrator and Custodian, and Cortland Capital Market Services LLC as Document Custodian and the lenders from time to time party thereto pursuant to Assignment and Assumption Agreements. On November 22, 2019 (the “SPV Asset Facility IV Amendment Date”), the parties to the SPV Asset Facility IV amended the SPV Asset Facility IV to increase the maximum principal amount of the SPV Asset Facility IV to $450 million in periodic increments through March 22, 2020.

From time to time, we expect to sell and contribute certain investments to ORCC Financing IV pursuant to a Sale and Contribution Agreement by and between us and ORCC Financing IV.  No gain or loss will be recognized as a result of the contribution.  Proceeds from the SPV Asset Facility IV will be used to finance the origination and acquisition of eligible assets by ORCC Financing IV, including the purchase of such assets from us.  We retain a residual interest in assets contributed to or acquired by ORCC Financing IV through our ownership of ORCC Financing IV.  The maximum principal amount of the Credit Facility is currently $450 million, subject to a ramp period; the availability of this amount is subject to an overcollateralization ratio test, which is based on the value of ORCC Financing IV’s assets from time to time, and satisfaction of certain conditions, including an interest coverage ratio test, certain concentration limits and collateral quality tests.

The SPV Asset Facility IV provides for the ability to (1) draw term loans and (2) draw and redraw revolving loans under the SPV Asset Facility IV for a period of up to two years after the Closing Date unless the revolving commitments are terminated or converted to term loans sooner as provided in the SPV Asset Facility IV (the “Commitment Termination Date”).  Unless otherwise terminated, the SPV Asset Facility IV will mature on August 2, 2029 (the “SPV Asset Facility IV Stated Maturity”).  Prior to the SPV Asset Facility IV Stated Maturity, proceeds received by ORCC Financing IV from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to us, subject to certain conditions.  On the SPV Asset Facility IV Stated Maturity, ORCC Financing IV must pay in full all outstanding fees and expenses and all principal and interest on outstanding borrowings, and the excess may be returned to us.

Amounts drawn bear interest at LIBOR (or, in the case of certain lenders that are commercial paper conduits, the lower of their cost of funds and LIBOR plus 0.25%) plus a spread ranging from 2.15% to 2.50%. We predominantly borrow utilizing LIBOR rate loans, generally electing one-month LIBOR upon borrowing. From the Closing Date to the Commitment Termination Date, there is a commitment fee ranging from 0.50% to 1.00% per annum on the undrawn amount, if any, of the revolving commitments in the SPV Asset Facility IV.  The SPV Asset Facility IV contains customary covenants, including certain financial maintenance covenants, limitations on the activities of ORCC Financing IV, including limitations on incurrence of incremental indebtedness, and customary events of default.  The SPV Asset Facility IV is secured by a perfected first priority security interest in the assets of ORCC Financing IV and on any payments received by ORCC Financing IV in respect of those assets.  Assets pledged to the Lenders will not be available to pay our debts.

CLOs

CLO I

On May 28, 2019 (the “CLO I Closing Date”), we completed a $596 million term debt securitization transaction (the “CLO I Transaction”), also known as a collateralized loan obligation transaction.  The secured notes and preferred shares issued in the CLO I Transaction and the secured loan borrowed in the CLO I Transaction were issued and incurred, as applicable, by our consolidated subsidiaries Owl Rock CLO I, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO I Issuer”), and Owl Rock CLO I, LLC, a Delaware limited liability company (the “CLO I Co-Issuer” and together with the CLO I Issuer, the “CLO I Issuers”) ”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO I Issuer.

In the CLO I Transaction the CLO I Issuers (A) issued the following notes pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO I Indenture”), by and among the CLO I Issuers and State Street Bank and Trust Company:  (i) $242 million of AAA(sf) Class A Notes, which bear interest at three-month LIBOR plus 1.80%, (ii) $30 million of AAA(sf) Class A-F Notes, which bear interest at a fixed rate of 4.165%, and (iii) $68 million of AA(sf) Class B Notes, which bear interest at three-month LIBOR plus 2.70% (together, the “CLO I Notes”) and (B) borrowed $50 million under floating rate loans (the “Class A Loans” and together with the CLO I Notes, the “CLO I Debt”), which bear interest at three-month LIBOR plus 1.80%, under a credit agreement (the “CLO I Credit Agreement”), dated as of the CLO I Closing Date, by and among the CLO I Issuers, as borrowers, various financial institutions, as lenders, and State Street Bank and Trust Company, as collateral trustee and loan agent.  The Class A Loans may be exchanged by the lenders for Class A Notes at any time, subject to certain conditions under the CLO I Credit Agreement and

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the Indenture.  The CLO I Debt is scheduled to mature on May 20, 2031. The CLO I Notes were privately placed by Natixis Securities Americas, LLC and SG Americas Securities, LLC.

Concurrently with the issuance of the CLO I Notes and the borrowing under the Class A Loans, the CLO I Issuer issued approximately $206.1 million of subordinated securities in the form of 206,106 preferred shares at an issue price of U.S.$1,000 per share (the “CLO I Preferred Shares”).  The CLO I Preferred Shares were issued by the CLO I Issuer as part of its issued share capital and are not secured by the collateral securing the CLO I Debt. We own all of the CLO I Preferred Shares, and as such, are eliminated in consolidation. We act as retention holder in connection with the CLO I Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO I Preferred Shares.

The Adviser serves as collateral manager for the CLO I Issuer under a collateral management agreement dated as of the CLO I Closing Date.  The Adviser is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO I Issuers’ equity or notes that we own.

The CLO I Debt is secured by all of the assets of the CLO I Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO I Transaction, we and ORCC Financing II LLC sold and contributed approximately $575 million par amount of middle market loans to the CLO I Issuer on the CLO I Closing Date.  Such loans constituted the initial portfolio assets securing the CLO I Debt.  We and ORCC Financing II LLC each made customary representations, warranties, and covenants to the CLO I Issuer regarding such sales and contributions under a loan sale agreement.

Through May 20, 2023, a portion of the proceeds received by the CLO I Issuer from the loans securing the CLO I Debt may be used by the CLO I Issuer to purchase additional middle market loans under the direction of the Adviser as the collateral manager in the CLO I Transaction.

The CLO I Debt is the secured obligation of the CLO I Issuers, and the CLO I Indenture and the CLO I Credit Agreement include customary covenants and events of default.  Assets pledged to holders of the Secured Debt and the other secured parties under the Indenture will not be available to pay our debts.

The CLO I Notes were offered in reliance on Section 4(a)(2) of the Securities Act. The CLO I Notes have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933, as amended (the "Securities Act") as applicable. For further details, see “ITEM 8. – Notes to Consolidated Financial Statements – Note 6. Debt.

CLO II

On December 12, 2019 (the “CLO II Closing Date”), we completed a $396.6 million term debt securitization transaction (the “CLO II Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by us. The secured notes and preferred shares issued in the CLO II Transaction were issued by our consolidated subsidiaries Owl Rock CLO II, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO II Issuer”), and Owl Rock CLO II, LLC, a Delaware limited liability company (the “CLO II Co-Issuer” and together with the Issuer, the “CLO II Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the Issuer.  

The CLO II Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO II Indenture”), by and among the Issuers and State Street Bank and Trust Company: (i) $157 million of AAA(sf) Class A-1L Notes, which bear interest at three-month LIBOR plus 1.75%, (ii) $40 million of AAA(sf) Class A-1F Notes, which bear interest at a fixed rate of 3.44%, (iii) $20 million of AAA(sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.20%, (iv) $40 million of AA(sf) Class B-L Notes, which bear interest at three-month LIBOR plus 2.75% and (v) $3 million of AA(sf) Class B-F Notes, which bear interest at a fixed rate of 4.46% (together, the “CLO II Debt”). The CLO II Debt was scheduled to mature on January 20, 2031. The CLO II Debt was privately placed by Deutsche Bank Securities Inc.

The CLO II Debt was redeemed in the CLO II Rifinancing, described below.

 Concurrently with the issuance of the CLO II Debt, the CLO II Issuer issued approximately $136.6 million of subordinated securities in the form of 136,600 preferred shares at an issue price of U.S.$1,000 per share (the “CLO II Preferred Shares”). The CLO II Preferred Shares were issued by the CLO II Issuer as part of its issued share capital and are not secured by the collateral securing the CLO II Debt. We purchased all of the CLO II Preferred Shares. We acted as retention holder in connection with the CLO II Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization

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transactions to retain exposure to the performance of the securitized assets and as such was required to retain a portion of the CLO II Preferred Shares.  

The Adviser serves as collateral manager for the CLO II Issuer under a collateral management agreement dated as of the CLO II Closing Date.  The Adviser is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO II Issuers’ equity or notes that we own.  

The CLO II Debt was secured by all of the assets of the CLO II Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO II Transaction, we and ORCC Financing III LLC sold and contributed approximately $400 million par amount of middle market loans to the CLO II Issuer on the CLO II Closing Date.  Such loans constituted the initial portfolio assets securing the CLO II Debt.  We and ORCC Financing III LLC each made customary representations, warranties, and covenants to the CLO II Issuer regarding such sales and contributions under a loan sale agreement.

Through January 20, 2022, a portion of the proceeds received by the CLO II Issuer from the loans securing the CLO II Debt could be used by the CLO II Issuer to purchase additional middle market loans under the direction of the Adviser as collateral manager for the CLO II Issuer and in accordance with the our investing strategy and ability to originate eligible middle market loans.  

The CLO II Debt was the secured obligation of the CLO II Issuers, and the CLO II Indenture includes customary covenants and events of default.  Assets pledged to holders of the Secured Debt and the other secured parties under the Indenture were not available to pay our debts.

The CLO II Debt was offered in reliance on Section 4(a)(2) of the Securities Act. The CLO II Notes have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable. For further details, see “ITEM 8. – Notes to Consolidated Financial Statements – Note 6. Debt.

CLO II Refinancing

On April 9, 2021 (the “CLO II Refinancing Date”), we completed a $398.1 million term debt securitization refinancing (the “CLO II Refinancing”), also known as a collateralized loan obligation refinancing, which is a form of secured financing incurred by us. The secured notes and preferred shares issued in the CLO II Refinancing were issued by the CLO II Issuer and the CLO II Co-Issuer and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the Issuer.  

The CLO II Refinancing was executed by the issuance of the following classes of notes pursuant to the CLO II Indenture, as supplemented by the supplemental indenture dated as of the CLO II Refinancing Date (the “CLO II Refinancing Indenture”), by and among the CLO II Issuers and State Street Bank and Trust Company:  (i) $204 million of AAA(sf) Class A-LR Notes, which bear interest at three-month LIBOR plus 1.55%, (ii) $20 million of AAA(sf) Class A-FR Notes, which bear interest at a fixed rate of 2.48% and (iii) $36 million of AA(sf) Class B-R Notes, which bear interest at three-month LIBOR plus 1.90% (together, the “CLO II Refinancing Debt”).  The CLO II Refinancing Debt is secured by the middle market loans, participation interests in middle market loans and other assets of the CLO II Issuer.  The CLO II Refinancing Debt is scheduled to mature on April 20, 2033.  The CLO II Refinancing Debt was privately placed by Deutsche Bank Securities Inc. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO II Refinancing Debt. The proceeds from the CLO II Refinancing were used to redeem in full the classes of notes issued on the CLO II Closing Date.

Concurrently with the issuance of the CLO II Refinancing Debt, the CLO II Issuer issued 1,500 additional shares of CLO II Preferred Shares at an issue price of U.S.$1,000 per share (the “CLO II Refinancing Preferred Shares”) resulting in a total outstanding number of CLO II Preferred Shares of 138,100 ($138.1 million total issue price).  The CLO II Refinancing Preferred Shares were issued by the CLO II Issuer as part of its issued share capital and are not secured by the collateral securing the CLO II Refinancing Debt. We purchased all of the CLO II Refinancing Preferred Shares. We act as retention holder in connection with the CLO II Refinancing for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO II Preferred Shares. The proceeds from the CLO II Refinancing Preferred Shares were used to pay certain expenses incurred in connection with the CLO II Refinancing.

Through April 20, 2025, a portion of the proceeds received by the CLO II Issuer from the loans securing the CLO II Refinancing Debt may be used by the CLO II Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO II Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans.  

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The CLO II Refinancing Debt is the secured obligation of the CLO II Issuers, and the CLO II Refinancing Indenture includes customary covenants and events of default.  The CLO II Refinancing Debt has not been registered under the Securities Act, or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO II Issuers’ equity or notes that we own.

CLO III

On March 26, 2020 (the “CLO III Closing Date”), we completed a $395.31 million term debt securitization transaction (the “CLO III Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing incurred by us.  The secured notes and preferred shares issued in the CLO III Transaction were issued by our consolidated subsidiaries Owl Rock CLO III, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO III Issuer”), and Owl Rock CLO III, LLC, a Delaware limited liability company (the “CLO III Co-Issuer” and together with the CLO III Issuer, the “CLO III Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO III Issuer.  

The CLO III Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the CLO III Closing Date (the “CLO III Indenture”), by and among the CLO III Issuers and State Street Bank and Trust Company:  (i) $166 million of AAA(sf) Class A-1L Notes, which bear interest at three-month LIBOR plus 1.80%, (ii) $40 million of AAA(sf) Class A-1F Notes, which bear interest at a fixed rate of 2.75%, (iii) $20 million of AAA(sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.00%,  and (iv) $34 million of AA(sf) Class B Notes, which bear interest at three-month LIBOR plus 2.45% (together, the “CLO III Debt”).  The CLO III Debt is scheduled to mature on April 20, 2032.  The CLO III Debt was privately placed by SG Americas Securities, LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO III Debt.

Concurrently with the issuance of the CLO III Debt, the CLO III Issuer issued approximately $135.31 million of subordinated securities in the form of 135,310 preferred shares at an issue price of U.S.$1,000 per share (the “CLO III Preferred Shares”).  The CLO III Preferred Shares were issued by the CLO III Issuer as part of its issued share capital and are not secured by the collateral securing the CLO III Debt. We own all of the CLO III Preferred Shares, and as such, these securities are eliminated in consolidation.  We act as retention holder in connection with the CLO III Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO III Preferred Shares.

The Adviser serves as collateral manager for the  CLO III  Issuer under a collateral management agreement dated as of the CLO III Closing Date.  The Adviser  is entitled to receive fees for providing these services.  The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO III Issuers’ equity or notes that we own.  

The CLO III Debt is secured by all of the assets of the CLO III Issuer, which will consist primarily of middle market loans, participation interests in middle market loans, and related rights and the cash proceeds thereof. As part of the CLO III Transaction, we and ORCC Financing IV LLC sold and contributed approximately $400 million par amount of middle market loans to the CLO III Issuer on the CLO III Closing Date.  Such loans constituted the initial portfolio assets securing the CLO III Debt.  Us and ORCC Financing IV LLC each made customary representations, warranties, and covenants to the CLO III Issuer regarding such sales and contributions under a loan sale agreement.

Through April 20, 2024, a portion of the proceeds received by the CLO III Issuer from the loans securing the CLO III Debt may be used by the CLO III Issuer to purchase additional middle market loans under the direction of the Adviser as the collateral manager for the CLO III Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans.  

The CLO III Debt is the secured obligation of the CLO III Issuers, and the CLO III Indenture includes customary covenants and events of default.  Assets pledged to holders of the CLO III Debt and the other secured parties under the CLO III Indenture will not be available to pay our debts.

The CLO III Debt was offered in reliance on Section 4(a)(2) of the Securities Act. The CLO III Debt has not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable.

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CLO IV

On May 28, 2020 (the “CLO IV Closing Date”), we completed a $438.9 million term debt securitization transaction (the “CLO IV Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing. The secured notes and preferred shares issued in the CLO IV Transaction were issued by our consolidated subsidiaries Owl Rock CLO IV, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO IV Issuer”), and Owl Rock CLO IV, LLC, a Delaware limited liability company (the “CLO IV Co-Issuer” and together with the CLO IV Issuer, the “CLO IV Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO IV Issuer.

The CLO IV Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO IV Indenture”), by and among the CLO IV Issuers and State Street Bank and Trust Company: (i) $236.5 million of AAA(sf) Class A-1 Notes, which bear interest at three-month LIBOR plus 2.62% and (ii) $15.5 million of AAA(sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 3.40% (together, the “CLO IV Secured Notes”). The CLO IV Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO IV Issuer. The CLO IV Secured Notes are scheduled to mature on May 20, 2029. The CLO IV Secured Notes were privately placed by Natixis Securities Americas LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO IV Secured Notes.

Concurrently with the issuance of the CLO IV Secured Notes, the CLO IV Issuer issued approximately $186.9 million of subordinated securities in the form of 186,900 preferred shares at an issue price of U.S.$1,000 per share (the “CLO IV Preferred Shares”). The CLO IV Preferred Shares were issued by the CLO IV Issuer as part of its issued share capital and are not secured by the collateral securing the CLO IV Secured Notes. We purchased all of the CLO IV Preferred Shares. We act as retention holder in connection with the CLO IV Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO IV Preferred Shares.

As part of the CLO IV Transaction, we entered into a loan sale agreement with the CLO IV Issuer dated as of the CLO IV Closing Date, which provided for the sale and contribution of approximately $275.07 million par amount of middle market loans to the CLO IV Issuer on the CLO IV Closing Date and for future sales to the CLO IV Issuer on an ongoing basis. Such loans constituted part of the initial portfolio of assets securing the CLO IV Secured Notes. The remainder of the initial portfolio assets securing the CLO IV Secured Notes consisted of approximately $174.92 million par amount of middle market loans purchased by the CLO IV Issuer from ORCC Financing II LLC, our wholly-owned subsidiary, under an additional loan sale agreement executed on the CLO IV Closing Date between the Issuer and ORCC Financing II LLC. We and ORCC Financing II LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement.

Through November 20, 2021, a portion of the proceeds received by the CLO IV Issuer from the loans securing the CLO IV Secured Notes may be used by the CLO IV Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO IV Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans.

The Secured Notes are the secured obligation of the CLO IV Issuers, and the CLO IV Indenture includes customary covenants and events of default. The CLO IV Secured Notes have not been registered under the Securities Act, or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser will serve as collateral manager for the CLO IV Issuer under a collateral management agreement dated as of the CLO IV Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO IV Issuers’ equity or notes that we own.

CLO V

On November 20, 2020 (the “CLO V Closing Date”), we completed a $345.45 million term debt securitization transaction (the “CLO V Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing. The secured notes and preferred shares issued in the CLO V Transaction were issued by our consolidated subsidiaries Owl Rock CLO V, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO V Issuer”), and Owl Rock CLO V, LLC, a Delaware limited liability company (the “CLO V Co-Issuer” and together with the CLO V Issuer, the “CLO V Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO V Issuer.

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The CLO V Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO V Indenture”), by and among the CLO V Issuers and State Street Bank and Trust Company: (i) $182 million of AAA(sf)/AAAsf Class A-1 Notes, which bear interest at three-month LIBOR plus 1.85% and (ii) $14 million of AAA(sf) Class A-2 Notes, which bear interest at three-month LIBOR plus 2.20% (together, the “CLO V Secured Notes”). The CLO V Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO V Issuer. The CLO V Secured Notes are scheduled to mature on November 20, 2029. The CLO V Secured Notes were privately placed by Natixis Securities Americas LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO V Secured Notes.

Concurrently with the issuance of the CLO V Secured Notes, the CLO V Issuer issued approximately $149.45 million of subordinated securities in the form of 149,450 preferred shares at an issue price of U.S.$1,000 per share (the “CLO V Preferred Shares”). The CLO V Preferred Shares were issued by the CLO V Issuer as part of its issued share capital and are not secured by the collateral securing the CLO V Secured Notes. We purchased all of the CLO V Preferred Shares. We act as retention holder in connection with the CLO V Transaction for the purposes of satisfying certain U.S. and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO V Preferred Shares.

As part of the CLO V Transaction, we entered into a loan sale agreement with the CLO V Issuer dated as of the CLO V Closing Date, which provided for the sale and contribution of approximately $201.75 million par amount of middle market loans to the CLO V Issuer on the CLO V Closing Date and for future sales to the CLO V Issuer on an ongoing basis. Such loans constituted part of the initial portfolio of assets securing the CLO V Secured Notes. The remainder of the initial portfolio assets securing the CLO V Secured Notes consisted of approximately $84.74 million par amount of middle market loans purchased by the CLO V Issuer from ORCC Financing II LLC, our wholly-owned subsidiary, under an additional loan sale agreement executed on the CLO V Closing Date between the Issuer and ORCC Financing II LLC. We and ORCC Financing II LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement.

Through July 20, 2022, a portion of the proceeds received by the CLO V Issuer from the loans securing the CLO V Secured Notes may be used by the CLO V Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO V Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans.

The Secured Notes are the secured obligation of the CLO V Issuers, and the CLO V Indenture includes customary covenants and events of default. The CLO V Secured Notes have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser will serve as collateral manager for the CLO V Issuer under a collateral management agreement dated as of the CLO V Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO V Issuers’ equity or notes that we own.

CLO VI

On May 5, 2021 (the “CLO VI Closing Date”), we completed a $397.78 million term debt securitization transaction (the “CLO VI Transaction”), also known as a collateralized loan obligation transaction, which is a form of secured financing. The secured notes and preferred shares issued in the CLO VI Transaction were issued by our consolidated subsidiaries Owl Rock CLO VI, Ltd., an exempted company incorporated in the Cayman Islands with limited liability (the “CLO VI Issuer”), and Owl Rock CLO VI, LLC, a Delaware limited liability company (the “CLO VI Co-Issuer” and together with the CLO VI Issuer, the “CLO VI Issuers”) and are backed by a portfolio of collateral obligations consisting of middle market loans and participation interests in middle market loans as well as by other assets of the CLO VI Issuer.

The CLO VI Transaction was executed by the issuance of the following classes of notes and preferred shares pursuant to an indenture and security agreement dated as of the Closing Date (the “CLO VI Indenture”), by and among the CLO VI Issuers and State Street Bank and Trust Company: (i) $ 224 million of AAA(sf) Class A Notes, which bear interest at three-month LIBOR plus 1.45%, (ii) $26 million of AA(sf) Class B-1 Notes, which bear interest at three-month LIBOR plus 1.75% and (iii) $10 million of AA(sf) Class B-F Notes, which bear interest at a fixed rate of 2.83%  (together, the “CLO VI Secured Notes”). The CLO VI Secured Notes are secured by the middle market loans, participation interests in middle market loans and other assets of the CLO VI Issuer. The CLO VI Secured Notes are scheduled to mature on June 21, 2032. The CLO VI Secured Notes are privately placed by SG Americas Securities, LLC. Upon the occurrence of certain triggering events relating to the end of LIBOR, a different benchmark rate will replace LIBOR as the reference rate for interest accruing on the CLO VI Secured Notes.

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Concurrently with the issuance of the CLO VI Secured Notes, the CLO VI Issuer issued approximately $137.78 million of subordinated securities in the form of 137,775 preferred shares at an issue price of U.S.$1,000 per share (the “CLO VI Preferred Shares”). The CLO VI Preferred Shares were issued by the CLO VI Issuer as part of its issued share capital and are be secured by the collateral securing the CLO VI Secured Notes. We purchased all of the CLO VI Preferred Shares. We will act as retention holder in connection with the CLO VI Transaction for the purposes of satisfying certain U.S., United Kingdom and European Union regulations requiring sponsors of securitization transactions to retain exposure to the performance of the securitized assets and as such is required to retain a portion of the CLO VI Preferred Shares.

As part of the CLO VI Transaction, we entered into a loan sale agreement with the CLO VI Issuer dated as of the CLO VI Closing Date, which provides for the sale and contribution of approximately $205.6 million par amount of middle market loans to the CLO VI Issuer on the CLO VI Closing Date and for future sales to the CLO VI Issuer on an ongoing basis. Such loans constitute part of the initial portfolio of assets securing the CLO VI Secured Notes. The remainder of the initial portfolio assets securing the CLO VI Secured Notes consists of approximately $164.7 million par amount of middle market loans purchased by the CLO VI Issuer from ORCC Financing IV LLC, our wholly-owned subsidiary, under an additional loan sale agreement executed on the CLO VI Closing Date between the Issuer and ORCC Financing IV LLC. We and ORCC Financing IV LLC each made customary representations, warranties, and covenants to the Issuer under the applicable loan sale agreement.

Through June 20, 2024, a portion of the proceeds received by the CLO VI Issuer from the loans securing the CLO VI Secured Notes may be used by the CLO VI Issuer to purchase additional middle market loans under the direction of the Adviser, in its capacity as collateral manager for the CLO VI Issuer and in accordance with our investing strategy and ability to originate eligible middle market loans.

The Secured Notes are the secured obligation of the CLO VI Issuers, and the CLO VI Indenture includes customary covenants and events of default. The CLO VI Secured Notes have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities (e.g., “blue sky”) laws, and may not be offered or sold in the United States absent registration with the Securities and Exchange Commission or pursuant to an applicable exemption from such registration.

The Adviser serves as collateral manager for the CLO VI Issuer under a collateral management agreement dated as of the CLO VI Closing Date. The Adviser is entitled to receive fees for providing these services. The Adviser has waived its right to receive such fees but may rescind such waiver at any time; provided, however, that if the Adviser rescinds such waiver, the management fee payable to the Adviser pursuant to the Investment Advisory Agreement will be offset by the amount of the collateral management fee attributable to the CLO VI Issuers’ equity or notes that we own.

Unsecured Notes

2023 Notes

On December 21, 2017, we entered into a Note Purchase Agreement governing the issuance of $150 million in aggregate principal amount of unsecured notes (the “2023 Notes”) to institutional investors in a private placement. The 2023 Notes have a fixed interest rate of 4.75% and are due on June 21, 2023. Interest on the 2023 Notes will be due semiannually. This interest rate is subject to increase (up to a maximum interest rate of 5.50%) in the event that, subject to certain exceptions, the 2023 Notes cease to have an investment grade rating. We are obligated to offer to repay the 2023 Notes at par if certain change in control events occur. The 2023 Notes are general unsecured obligations of us that rank pari passu with all outstanding and future unsecured unsubordinated indebtedness issued by us.

The Note Purchase Agreement for the 2023 Notes contains customary terms and conditions for unsecured notes issued in a private placement, including, without limitation, affirmative and negative covenants such as information reporting, maintenance of our status as a BDC within the meaning of the 1940 Act and a RIC under the Code, minimum shareholders equity, minimum asset coverage ratio and prohibitions on certain fundamental changes at us or any subsidiary guarantor, as well as customary events of default with customary cure and notice, including, without limitation, nonpayment, misrepresentation in a material respect, breach of covenant, cross-default under other indebtedness of us or certain significant subsidiaries, certain judgments and orders, and certain events of bankruptcy.

The 2023 Notes were offered in reliance on Section 4(a)(2) of the Securities Act. The 2023 Notes have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act as applicable.

In connection with the offering of the 2023 Notes, on December 21, 2017 we entered into a centrally cleared interest rate swap. The notional amount of the interest rate swap is $150 million. We will receive fixed rate interest semi-annually at 4.75% and pay variable rate interest monthly based on 1-month LIBOR plus 2.545%. The interest rate swap matures on December 21, 2021. For the three months ended March 31, 2021 and 2020, we made periodic payments of $1.0 million and $1.6 million, respectively. The interest expense related to the 2023 Notes is equally offset by the proceeds received from the interest rate swap. The swap adjusted interest expense is included as a component of interest expense on our Consolidated Statements of Operations. As of March 31, 2021 and December 31, 2020, the interest rate swap had a fair value of $2.2 million and $3.0 million, respectively. Depending on the nature of

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the balance at period end, the fair value of the interest rate swap is either included as a component of accrued expenses and other liabilities or prepaid expenses and other assets on our Consolidated Statements of Assets and Liabilities.  The change in fair value of the interest rate swap is offset by the change in fair value of the 2023 Notes, with the remaining difference included as a component of interest expense on the Consolidated Statements of Operations. For further details, see “ITEM 8. – Notes to Consolidated Financial Statements – Note 6. Debt.

2024 Notes

On April 10, 2019, we issued $400 million aggregate principal amount of notes that mature on April 15, 2024 (the “2024 Notes”). The 2024 Notes bear interest at a rate of 5.250% per year, payable semi-annually on April 15 and October 15 of each year, commencing on October 15, 2019. We may redeem some or all of the 2024 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2024 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2024 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any 2024 Notes on or after March 15, 2024 (the date falling one month prior to the maturity date of the 2024 Notes), the redemption price for the 2024 Notes will be equal to 100% of the principal amount of the 2024 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with the issuance of the 2024 Notes, on April 10, 2019 we entered into centrally cleared interest rate swaps. The notional amount of the interest rate swaps is $400 million. We will receive fixed rate interest at 5.25% and pay variable rate interest based on one-month LIBOR plus 2.937%. The interest rate swaps mature on April 10, 2024. For the three months ended March 31, 2021 and 2020, we made no periodic payments. The interest expense related to the 2024 Notes is equally offset by the proceeds received from the interest rate swaps. The swap adjusted interest expense is included as a component of interest expense on our Consolidated Statements of Operations. As of March 31, 2021 and December 31, 2020, the interest rate swap had a fair value of $22.0 million and $26.9 million, respectively.  Depending on the nature of the balance at period end, the fair value of the interest rate swap is either included as a component of accrued expenses and other liabilities or prepaid expenses and other assets on our Consolidated Statements of Assets and Liabilities.  The change in fair value of the interest rate swap is offset by the change in fair value of the 2024 Notes, with the remaining difference included as a component of interest expense on the Consolidated Statements of Operations. For further details, see “ITEM 8. – Notes to Consolidated Financial Statements – Note 6. Debt.

2025 Notes

On October 8, 2019, we issued $425 million aggregate principal amount of notes that mature on March 30, 2025 (the “2025 Notes”). The 2025 Notes bear interest at a rate of 4.00% per year, payable semi-annually on March 30 and September 30 of each year, commencing on March 30, 2020. We may redeem some or all of the 2025 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2025 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2025 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 40 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any 2025 Notes on or after February 28, 2025 (the date falling one month prior to the maturity date of the 2025 Notes), the redemption price for the 2025 Notes will be equal to 100% of the principal amount of the 2025 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption. “ITEM 8. – Notes to Consolidated Financial Statements – Note 6. Debt.”

July 2025 Notes

On January 22, 2020, we issued $500 million aggregate principal amount of notes that mature on July 22, 2025 (the “July 2025 Notes”). The July 2025 Notes bear interest at a rate of 3.75% per year, payable semi-annually on January 22 and July 22, of each year, commencing on July 22, 2020. We may redeem some or all of the July 2025 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the July 2025 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the July 2025 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 35 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any July 2025 Notes on or after June 22, 2025 (the date falling one month prior to the maturity date of the 2025 Notes), the redemption price for the July 2025 Notes will be equal to 100% of the principal amount of the July 2025 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

2026 Notes

On July 23, 2020, we issued $500 million aggregate principal amount of notes that mature on January 15, 2026 (the “2026 Notes”). The 2026 Notes bear interest at a rate of 4.25% per year, payable semi-annually on January 15 and July 15 of each year,

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commencing on January 15, 2021. We may redeem some or all of the 2026 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2026 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2026 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any 2026 Notes on or after December, 15 2025 (the date falling one month prior to the maturity date of the 2026 Notes), the redemption price for the 2026 Notes will be equal to 100% of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

July 2026 Notes

On December 8, 2020, we issued $1.0 billion aggregate principal amount of notes that mature on July 15, 2026 (the “July 2026 Notes”). The July 2026 Notes bear interest at a rate of 3.40% per year, payable semi-annually on January 15 and July 15 of each year, commencing on July 15, 2021. We may redeem some or all of the July 2026 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the July 2026 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the July 2026 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any July 2026 Notes on or after June 15, 2026 (the date falling one month prior to the maturity date of the July 2026 Notes), the redemption price for the July 2026 Notes will be equal to 100% of the principal amount of the July 2026 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

 

2027 Notes

 

On April 26, 2021, we issued $500 million aggregate principal amount of notes that mature on January 15, 2027 (the “2027 Notes”). The 2027 Notes bear interest at a rate of 2.625% per year, payable semi-annually on January 15 and July 15, of each year, commencing on July 15, 2021. We may redeem some or all of the 2027 Notes at any time, or from time to time, at a redemption price equal to the greater of (1) 100% of the principal amount of the 2027 Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of redemption) on the 2027 Notes to be redeemed, discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 30 basis points, plus, in each case, accrued and unpaid interest to the redemption date; provided, however, that if we redeem any 2027 Notes on or after December 15, 2026 (the date falling one month prior to the maturity date of the 2027 Notes), the redemption price for the 2027 Notes will be equal to 100% of the principal amount of the 2027 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the date of redemption.

In connection with the issuance of the 2027 Notes, on April 26, 2021 we entered into centrally cleared interest rate swaps. The notional amount of the interest rate swaps is $500 million. We will receive fixed rate interest at 2.625% and pay variable rate interest based on one-month LIBOR plus 1.655%. The interest rate swaps mature on January 15, 2027. Pursuant to ASC 815 Derivatives and Hedging, the interest expense related to the 2027 Notes is offset by the proceeds received from the interest rate swaps. The swap adjusted interest expense will be included as a component of interest expense on our Consolidated Statements of Operations.

 

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Off-Balance Sheet Arrangements

Portfolio Company Commitments

From time to time, we may enter into commitments to fund investments. As of March 31, 2021 and December 31, 2020, we had the following outstanding commitments to fund investments in current portfolio companies:

Portfolio Company

 

Investment

 

 

 

March 31, 2021

 

 

December 31, 2020

 

($ in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

3ES Innovation Inc. (dba Aucerna)

 

First lien senior secured revolving loan

 

$

3,893

 

 

$

3,893

 

Accela, Inc.

 

First lien senior secured revolving loan

 

 

3,000

 

 

 

3,000

 

Amspec Services Inc.

 

First lien senior secured revolving loan

 

 

14,462

 

 

 

14,462

 

Apptio, Inc.

 

First lien senior secured revolving loan

 

 

1,667

 

 

 

2,779

 

Aramsco, Inc.

 

First lien senior secured revolving loan

 

 

8,378

 

 

 

8,378

 

Ardonagh Midco 3 PLC

 

First lien senior secured delayed draw term loan

 

 

6,843

 

 

 

16,950

 

Associations, Inc.

 

First lien senior secured delayed draw term loan

 

 

866

 

 

 

866

 

AxiomSL Group, Inc.

 

First lien senior secured revolving loan

 

 

9,341

 

 

 

9,341

 

Barracuda Dental LLC (dba National Dentex)

 

First lien senior secured delayed draw term loan

 

 

30,438

 

 

 

30,437

 

Barracuda Dental LLC (dba National Dentex)

 

First lien senior secured revolving loan

 

 

3,980

 

 

 

5,854

 

BCTO BSI Buyer, Inc. (dba Buildertrend)

 

First lien senior secured revolving loan

 

 

5,357

 

 

 

5,357

 

BIG Buyer, LLC

 

First lien senior secured delayed draw term loan

 

 

 

 

 

5,625

 

BIG Buyer, LLC

 

First lien senior secured revolving loan

 

 

2,250

 

 

 

2,000

 

Caiman Merger Sub LLC (dba City Brewing)

 

First lien senior secured revolving loan

 

 

12,881

 

 

 

12,881

 

Centrify Corporation

 

First lien senior secured revolving loan

 

 

3,654

 

 

 

 

ConnectWise, LLC

 

First lien senior secured revolving loan

 

 

18,754

 

 

 

15,004

 

Definitive Healthcare Holdings, LLC

 

First lien senior secured delayed draw term loan

 

 

30,701

 

 

 

35,651

 

Definitive Healthcare Holdings, LLC

 

First lien senior secured revolving loan

 

 

9,360

 

 

 

10,870

 

Douglas Products and Packaging Company LLC

 

First lien senior secured revolving loan

 

 

4,844

 

 

 

6,055

 

Endries Acquisition, Inc.

 

First lien senior secured revolving loan

 

 

27,000

 

 

 

27,000

 

Entertainment Benefits Group, LLC

 

First lien senior secured revolving loan

 

 

1,104

 

 

 

1,104

 

Forescout Technologies, Inc.

 

First lien senior secured revolving loan

 

 

5,345

 

 

 

5,345

 

Galls, LLC

 

First lien senior secured revolving loan

 

 

4,566

 

 

 

11,204

 

Gaylord Chemical Company, L.L.C

 

First lien senior secured revolving loan

 

 

13,202

 

 

 

 

GC Agile Holdings Limited (dba Apex Fund Services)

 

First lien senior secured revolving loan

 

 

10,386

 

 

 

6,924

 

Gerson Lehrman Group, Inc.

 

First lien senior secured revolving loan

 

 

21,563

 

 

 

21,563

 

Granicus, Inc.

 

First lien senior secured delayed draw term loan

 

 

2,967

 

 

 

 

Granicus, Inc.

 

First lien senior secured revolving loan

 

 

1,187

 

 

 

2,636

 

H&F Opportunities LUX III S.À R.L (dba Checkmarx)

 

First lien senior secured revolving loan

 

 

16,250

 

 

 

16,250

 

Hercules Borrower, LLC (dba The Vincit Group)

 

First lien senior secured revolving loan

 

 

20,916

 

 

 

20,916

 

HGH Purchaser, Inc. (dba Horizon Services)

 

First lien senior secured delayed draw term loan

 

 

44,518

 

 

 

5,346

 

HGH Purchaser, Inc. (dba Horizon Services)

 

First lien senior secured revolving loan

 

 

9,234

 

 

 

8,748

 

Hometown Food Company

 

First lien senior secured revolving loan

 

 

4,235

 

 

 

3,671

 

Ideal Tridon Holdings, Inc.

 

First lien senior secured revolving loan

 

 

4,828

 

 

 

4,828

 

Individual Foodservice Holdings, LLC

 

First lien senior secured delayed draw term loan

 

 

21,449

 

 

 

25,781

 

Individual Foodservice Holdings, LLC

 

First lien senior secured revolving loan

 

 

17,733

 

 

 

18,465

 

118


 

Portfolio Company

 

Investment

 

 

 

March 31, 2021

 

 

December 31, 2020

 

Instructure, Inc.

 

First lien senior secured revolving loan

 

 

5,554

 

 

 

5,554

 

Integrity Marketing Acquisition, LLC

 

First lien senior secured revolving loan

 

 

14,832

 

 

 

14,832

 

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)

 

First lien senior secured delayed draw term loan

 

 

6,153

 

 

 

 

Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)

 

First lien senior secured revolving loan

 

 

4,530

 

 

 

4,530

 

Interoperability Bidco, Inc.

 

First lien senior secured delayed draw term loan

 

 

8,000

 

 

 

8,000

 

Interoperability Bidco, Inc.

 

First lien senior secured revolving loan

 

 

4,000

 

 

 

 

IQN Holding Corp. (dba Beeline)

 

First lien senior secured revolving loan

 

 

22,672

 

 

 

22,672

 

KWOR Acquisition, Inc. (dba Worley Claims Services)

 

First lien senior secured delayed draw term loan

 

 

 

 

 

2,063

 

KWOR Acquisition, Inc. (dba Alacrity Solutions)

 

First lien senior secured revolving loan

 

 

4,160

 

 

 

5,200

 

Lazer Spot G B Holdings, Inc.

 

First lien senior secured revolving loan

 

 

26,833

 

 

 

26,833

 

Lightning Midco, LLC (dba Vector Solutions)

 

First lien senior secured revolving loan

 

 

8,953

 

 

 

8,953

 

Litera Bidco LLC

 

First lien senior secured revolving loan

 

 

5,738

 

 

 

5,738

 

Lytx, Inc.

 

First lien senior secured delayed draw term loan

 

 

14,092

 

 

 

14,092

 

Mavis Tire Express Services Corp.

 

Second lien senior secured delayed draw term loan

 

 

 

 

 

11,376

 

MINDBODY, Inc.

 

First lien senior secured revolving loan

 

 

6,071

 

 

 

6,071

 

Nelipak Holding Company

 

First lien senior secured revolving loan

 

 

2,948

 

 

 

2,948

 

Nelipak Holding Company

 

First lien senior secured revolving loan

 

 

7,770

 

 

 

7,597

 

NMI Acquisitionco, Inc. (dba Network Merchants)

 

First lien senior secured revolving loan

 

 

646

 

 

 

646

 

Norvax, LLC (dba GoHealth)

 

First lien senior secured revolving loan

 

 

12,273

 

 

 

12,273

 

Nutraceutical International Corporation

 

First lien senior secured revolving loan

 

 

13,578

 

 

 

13,578

 

PATRIOT ACQUISITION TOPCO S.À R.L. (dba Corza Health, Inc.)

 

First lien senior secured revolving loan

 

 

13,538

 

 

 

 

Peter C. Foy & Associated Insurance Services, LLC

 

First lien senior secured delayed draw term loan C

 

 

12,249

 

 

 

37,955

 

Peter C. Foy & Associated Insurance Services, LLC

 

First lien senior secured delayed draw term loan D

 

 

25,271

 

 

 

 

Peter C. Foy & Associated Insurance Services, LLC

 

First lien senior secured revolving loan

 

 

8,258

 

 

 

8,194

 

PCF Holdco, LLC

 

Class A Units

 

 

17,239

 

 

 

 

Professional Plumbing Group, Inc.

 

First lien senior secured revolving loan

 

 

5,757

 

 

 

5,757

 

Project Power Buyer, LLC (dba PEC-Veriforce)

 

First lien senior secured revolving loan

 

 

3,188

 

 

 

3,188

 

QC Supply, LLC

 

First lien senior secured revolving loan

 

 

633

 

 

 

633

 

Reef Global, Inc. (fka Cheese Acquisition, LLC)

 

First lien senior secured revolving loan

 

 

5,377

 

 

 

5,377

 

Refresh Parent Holdings, Inc.

 

First lien senior secured delayed draw term loan

 

 

13,405

 

 

 

29,482

 

Refresh Parent Holdings, Inc.

 

First lien senior secured revolving loan

 

 

10,776

 

 

 

7,716

 

RSC Acquisition, Inc (dba Risk Strategies)

 

First lien senior secured revolving loan

 

 

933

 

 

 

1,702

 

Safety Products/JHC Acquisition Corp. (dba Justrite Safety Group)

 

First lien senior secured delayed draw term loan

 

 

924

 

 

 

924

 

Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)

 

First lien senior secured revolving loan

 

 

3,360

 

 

 

4,440

 

Sonny's Enterprises LLC

 

First lien senior secured revolving loan

 

 

17,969

 

 

 

17,969

 

Swipe Acquisition Corporation (dba PLI)

 

First lien senior secured delayed draw term loan

 

 

15,347

 

 

 

18,461

 

Swipe Acquisition Corporation (dba PLI)

 

Letter of credit

 

 

7,118

 

 

 

7,118

 

119


 

Portfolio Company

 

Investment

 

 

 

March 31, 2021

 

 

December 31, 2020

 

TC Holdings, LLC (dba TrialCard)

 

First lien senior secured revolving loan

 

 

7,685

 

 

 

7,685

 

THG Acquisition, LLC (dba Hilb)

 

First lien senior secured delayed draw term loan

 

 

33,421

 

 

 

36,302

 

THG Acquisition, LLC (dba Hilb)

 

First lien senior secured revolving loan

 

 

8,608

 

 

 

8,608

 

Trader Interactive, LLC (fka Dominion Web Solutions, LLC)

 

First lien senior secured revolving loan

 

 

5,961

 

 

 

4,471

 

Troon Golf, L.L.C.

 

First lien senior secured revolving loan

 

 

14,426

 

 

 

14,426

 

TSB Purchaser, Inc. (dba Teaching Strategies, Inc.)

 

First lien senior secured revolving loan

 

 

4,239

 

 

 

4,239

 

Ultimate Baked Goods Midco, LLC

 

First lien senior secured revolving loan

 

 

4,447

 

 

 

4,638

 

Valence Surface Technologies LLC

 

First lien senior secured delayed draw term loan

 

 

6,000

 

 

 

6,000

 

Valence Surface Technologies LLC

 

First lien senior secured revolving loan

 

 

4,000

 

 

 

10,000

 

WU Holdco, Inc. (dba Weiman Products, LLC)

 

First lien senior secured revolving loan

 

 

13,828

 

 

 

10,739

 

Wingspire Capital Holdings LLC

 

LLC Interest

 

 

32,462

 

 

 

82,462

 

Total Unfunded Portfolio Company Commitments

 

 

 

 

 

$

862,374

 

 

$

880,626

 

 

We maintain sufficient borrowing capacity to cover outstanding unfunded portfolio company commitments that we may be required to fund. We seek to carefully consider our unfunded portfolio company commitments for the purpose of planning our ongoing financial leverage. Further, we maintain sufficient borrowing capacity within the 150% asset coverage limitation to cover any outstanding portfolio company unfunded commitments we are required to fund.

Other Commitments and Contingencies

We had raised $5.5 billion in total Capital Commitments from investors, of which $112.4 million was from executives of Owl Rock. As of June 17, 2019, all outstanding Capital Commitments had been drawn.

In connection with the IPO, on July 22, 2019, we entered into the Company 10b5-1 Plan, to acquire up to $150 million in the aggregate of our common stock at prices below its net asset value per share over a specified period, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the Exchange Act. The Company 10b5-1 Plan commenced on August 19, 2019. Goldman, Sachs & Co., as agent has repurchased an aggregate of 12,515,624 shares of our common stock pursuant to the Company 10b5-1 Plan for an aggregate of approximately $150 million. The 10b5-1 Plan was exhausted on August 4, 2020.

On November 3, 2020, our Board approved a repurchase program under which we may repurchase up to $100 million of our outstanding common stock. Under the program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities laws and regulations. Unless extended by our Board, the repurchase program will terminate 12-months from the date it was approved. As of March 31, 2021, no repurchases were made under the Repurchase Plan.

From time to time, we may become a party to certain legal proceedings incidental to the normal course of its business. At March 31, 2021, we were not aware of any material pending or threatened litigation that would require accounting recognition or financial statement disclosure.

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Contractual Obligations

A summary of our contractual payment obligations under our credit facilities as of March 31, 2021, is as follows:

 

 

 

Payments Due by Period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

($ in millions)

 

Total

 

 

Less than 1 year

 

 

1-3 years

 

 

3-5 years

 

 

After 5 years

 

Revolving Credit Facility

 

$

553.5

 

 

$

 

 

$

 

 

 

553.5

 

 

 

 

SPV Asset Facility II

 

 

100.0

 

 

 

 

 

 

 

 

 

 

 

 

100.0

 

SPV Asset Facility III

 

 

375.0

 

 

 

 

 

 

375.0

 

 

 

 

 

 

 

SPV Asset Facility IV

 

 

250.0

 

 

 

 

 

 

 

 

 

 

 

 

250.0

 

CLO I

 

 

390.0

 

 

 

 

 

 

 

 

 

 

 

 

390.0

 

CLO II

 

 

260.0

 

 

 

 

 

 

 

 

 

 

 

 

260.0

 

CLO III

 

 

260.0

 

 

 

 

 

 

 

 

 

 

 

 

260.0

 

CLO IV

 

 

252.0

 

 

 

 

 

 

 

 

 

 

 

 

252.0

 

CLO V

 

 

196.0

 

 

 

 

 

 

 

 

 

 

 

 

196.0

 

2023 Notes

 

 

150.0

 

 

 

 

 

 

150.0

 

 

 

 

 

 

 

2024 Notes

 

 

400.0

 

 

 

 

 

 

 

 

 

400.0

 

 

 

 

2025 Notes

 

 

425.0

 

 

 

 

 

 

 

 

 

425.0

 

 

 

 

July 2025 Notes

 

 

500.0

 

 

 

 

 

 

 

 

 

500.0

 

 

 

 

2026 Notes

 

 

500.0

 

 

 

 

 

 

 

 

 

500.0

 

 

 

 

July 2026 Notes

 

 

1,000.0

 

 

 

 

 

 

 

 

 

 

 

 

1,000.0

 

Total Contractual Obligations

 

$

5,611.5

 

 

$

 

 

$

525.0

 

 

$

2,378.5

 

 

$

2,708.0

 

 

Related-Party Transactions

We have entered into a number of business relationships with affiliated or related parties, including the following:

 

the Investment Advisory Agreement;

 

the Administration Agreement; and

 

the License Agreement.

In addition to the aforementioned agreements, we, our Adviser and certain of our Adviser’s affiliates have been granted exemptive relief by the SEC to co-invest with other funds managed by he Owl Rock Advisers, including the Owl Rock Clients, in a manner consistent with our investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. See “ITEM 1. – Notes to Consolidated Financial Statements – Note 3. Agreements and Related Party Transactions” for further details.

 

We invest through Wingspire and, together with Regents, through Sebago Lake, controlled affiliated investments as defined in the 1940 Act. See “ITEM 1. – Notes to Consolidated Financial Statements – Note 3. Agreements and Related Party Transactions” for further details.

 

Critical Accounting Policies

The preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Changes in the economic environment, financial markets, and any other parameters used in determining such estimates could cause actual results to differ.  Our critical accounting policies should be read in connection with our risk factors as described in “ITEM 1A. RISK FACTORS.

 

Investments at Fair Value

Investment transactions are recorded on the trade date. Realized gains or losses are measured by the difference between the net proceeds received (excluding prepayment fees, if any) and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. The net change in unrealized gains or losses primarily reflects the change in investment values, including the reversal of previously recorded unrealized gains or losses with respect to investments realized during the period.

121


 

Investments for which market quotations are readily available are typically valued at the bid price of those market quotations. To validate market quotations, we utilize a number of factors to determine if the quotations are representative of fair value, including the source and number of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available, as is the case for substantially all of our investments, are valued at fair value as determined in good faith by our Board, based on, among other things, the input of the Adviser, our audit committee and independent third-party valuation firm(s) engaged at the direction of the Board.

As part of the valuation process, the Board takes into account relevant factors in determining the fair value of our investments, including: the estimated enterprise value of a portfolio company (i.e., the total fair value of the portfolio company’s debt and equity), the nature and realizable value of any collateral, the portfolio company’s ability to make payments based on its earnings and cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company’s securities to any similar publicly traded securities, and overall changes in the interest rate environment and the credit markets that may affect the price at which similar investments may be made in the future. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Board considers whether the pricing indicated by the external event corroborates its valuation.

The Board undertakes a multi-step valuation process, which includes, among other procedures, the following:

 

With respect to investments for which market quotations are readily available, those investments will typically be valued at the bid price of those market quotations;

 

With respect to investments for which market quotations are not readily available, the valuation process begins with the independent valuation firm(s) providing a preliminary valuation of each investment to the Adviser’s valuation committee;

 

Preliminary valuation conclusions are documented and discussed with the Adviser’s valuation committee. Agreed upon valuation recommendations are presented to the Audit Committee;

 

The Audit Committee reviews the valuation recommendations and recommends values for each investment to the Board; and

 

The Board reviews the recommended valuations and determines the fair value of each investment.

We conduct this valuation process on a quarterly basis.

We apply ASC 820, which establishes a framework for measuring fair value in accordance with U.S. GAAP and required disclosures of fair value measurements. ASC 820 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date.  Market participants are defined as buyers and sellers in the principal or most advantageous market (which may be a hypothetical market) that are independent, knowledgeable, and willing and able to transact.  In accordance with ASC 820, we consider its principal market to be the market that has the greatest volume and level of activity. ASC 820 specifies a fair value hierarchy that prioritizes and ranks the level of observability of inputs used in determination of fair value.  In accordance with ASC 820, these levels are summarized below:

 

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

 

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

 

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

Transfers between levels, if any, are recognized at the beginning of the quarter in which the transfer occurred. In addition to using the above inputs in investment valuations, we apply the valuation policy approved by our Board that is consistent with ASC 820.  Consistent with the valuation policy, we evaluate the source of the inputs, including any markets in which our investments are trading (or any markets in which securities with similar attributes are trading), in determining fair value. When an investment is valued based on prices provided by reputable dealers or pricing services (that is, broker quotes), we subject those prices to various criteria in making the determination as to whether a particular investment would qualify for treatment as a Level 2 or Level 3 investment. For example, we, or the independent valuation firm(s), review pricing support provided by dealers or pricing services in order to determine if observable market information is being used, versus unobservable inputs.

Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of our investments may fluctuate from period to period. Additionally, the fair value of such investments may differ significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If we were required to liquidate a portfolio investment in a forced or liquidation sale, it could realize amounts that are different from the amounts presented and such differences could be material.

122


 

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

Rule 2a-5 under the 1940 Act was recently adopted by the SEC and establishes requirements for determining fair value in good faith for purposes of the 1940 Act.  We are evaluating the impact of adopting Rule 2a-5 on the consolidated financial statements and intend to comply with the new rule’s requirements on or before the compliance date in September 2022.

Interest and Dividend Income Recognition

Interest income is recorded on the accrual basis and includes amortization of discounts or premiums. Certain investments may have contractual payment-in-kind (“PIK”) interest or dividends. PIK interest represents accrued interest that is added to the principal amount of the investment on the respective interest payment dates rather than being paid in cash and generally becomes due at maturity. Discounts to par value on securities purchased are amortized into interest income over the contractual life of the respective security using the effective yield method. Premiums to par value on securities purchased are amortized to first call date. The amortized cost of investments represents the original cost adjusted for the amortization of discounts or premiums, if any. Upon prepayment of a loan or debt security, any prepayment premiums, unamortized upfront loan origination fees and unamortized discounts are recorded as interest income in the current period.

Loans are generally placed on non-accrual status when there is reasonable doubt that principal or interest will be collected in full. Accrued interest is generally reversed when a loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment regarding collectability. If at any point we believe PIK interest is not expected to be realized, the investment generating PIK interest will be placed on non-accrual status. When a PIK investment is placed on non-accrual status, the accrued, uncapitalized interest or dividends are generally reversed through interest income. Non-accrual loans are restored to accrual status when past due principal and interest is paid current and, in management’s judgment, are likely to remain current. Management may make exceptions to this treatment and determine to not place a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection.

Dividend income on preferred equity securities is recorded on the accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly-traded portfolio companies.

Distributions

We have elected to be treated for U.S. federal income tax purposes, and qualify annually thereafter, as a RIC under Subchapter M of the Code. To obtain and maintain our tax treatment as a RIC, we must distribute (or be deemed to distribute) in each taxable year distributions for tax purposes equal to at least 90 percent of the sum of our:

 

investment company taxable income (which is generally our ordinary income plus the excess of realized short-term capital gains over realized net long-term capital losses), determined without regard to the deduction for dividends paid, for such taxable year; and

 

net tax-exempt interest income (which is the excess of our gross tax-exempt interest income over certain disallowed deductions) for such taxable year.

As a RIC, we (but not our shareholders) generally will not be subject to U.S. federal tax on investment company taxable income and net capital gains that we distribute to our shareholders.

We intend to distribute annually all or substantially all of such income. To the extent that we retain our net capital gains or any investment company taxable income, we generally will be subject to corporate-level U.S. federal income tax. We can be expected to carry forward our net capital gains or any investment company taxable income in excess of current year dividend distributions, and pay the U.S. federal excise tax as described below.

Amounts not distributed on a timely basis in accordance with a calendar year distribution requirement are subject to a nondeductible 4% U.S. federal excise tax payable by us. We may be subject to a nondeductible 4% U.S. federal excise tax if we do not distribute (or are treated as distributing) during each calendar year an amount at least equal to the sum of:

 

98% of our net ordinary income excluding certain ordinary gains or losses for that calendar year;

 

98.2% of our capital gain net income, adjusted for certain ordinary gains and losses, recognized for the twelve-month period ending on October 31 of that calendar year; and

 

100% of any income or gains recognized, but not distributed, in preceding years.

While we intend to distribute any income and capital gains in the manner necessary to minimize imposition of the 4% U.S. federal excise tax, sufficient amounts of our taxable income and capital gains may not be distributed and as a result, in such cases, the excise

123


 

tax will be imposed. In such an event, we will be liable for this tax only on the amount by which we do not meet the foregoing distribution requirement.

We intend to pay quarterly distributions to our shareholders out of assets legally available for distribution. All distributions will be paid at the discretion of our Board and will depend on our earnings, financial condition, maintenance of our tax treatment as a RIC, compliance with applicable BDC regulations and such other factors as our Board may deem relevant from time to time.

To the extent our current taxable earnings for a year fall below the total amount of our distributions for that year, a portion of those distributions may be deemed a return of capital to our shareholders for U.S. federal income tax purposes. Thus, the source of a distribution to our shareholders may be the original capital invested by the shareholder rather than our income or gains. Shareholders should read written disclosure carefully and should not assume that the source of any distribution is our ordinary income or gains.

We have adopted an “opt out” dividend reinvestment plan for our common shareholders. As a result, if we declare a cash dividend or other distribution, each shareholder that has not “opted out” of our dividend reinvestment plan will have their dividends or distributions automatically reinvested in additional shares of our common stock rather than receiving cash distributions. Shareholders who receive distributions in the form of shares of common stock will be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions.

Income Taxes

We have elected to be treated as a BDC under the 1940 Act. We have also elected to be treated as a RIC under the Code beginning with the taxable year ending December 31, 2016 and intend to continue to qualify as a RIC. So long as we maintain our tax treatment as a RIC, we generally will not pay corporate-level U.S. federal income taxes on any ordinary income or capital gains that we distribute at least annually to our shareholders as distributions. Rather, any tax liability related to income earned and distributed by us represents obligations of our investors and will not be reflected in our consolidated financial statements.

To qualify as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements. In addition, to qualify for RIC tax treatment, we must distribute to our shareholders, for each taxable year, at least 90% of our “investment company taxable income” for that year, which is generally our ordinary income plus the excess of our realized net short-term capital gains over our realized net long-term capital losses. In order for us to not be subject to U.S. federal excise taxes, we must distribute annually an amount at least equal to the sum of (i) 98% of our net ordinary income (taking into account certain deferrals and elections) for the calendar year, (ii) 98.2% of our capital gains in excess of capital losses for the one-year period ending on October 31 of the calendar year and (iii) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years. We, at our discretion, may carry forward taxable income in excess of calendar year dividends and pay a 4% nondeductible U.S. excise tax on this income.

Certain consolidated subsidiaries of ours are subject to U.S. federal and state corporate-level income taxes.

We evaluate tax positions taken or expected to be taken in the course of preparing our consolidated financial statements to determine whether the tax positions are “more-likely-than-not” to be sustained by the applicable tax authority. Tax positions not deemed to meet the “more-likely-than-not” threshold are reserved and recorded as a tax benefit or expense in the current year. All penalties and interest associated with income taxes are included in income tax expense. Conclusions regarding tax positions are subject to review and may be adjusted at a later date based on factors including, but not limited to, on-going analyses of tax laws, regulations and interpretations thereof. There were no material uncertain tax positions through December 31, 2020. The 2017 through 2019 tax years remain subject to examination by U.S. federal, state and local tax authorities.

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Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are subject to financial market risks, including valuation risk and interest rate risk.

Valuation Risk

We have invested, and plan to continue to invest, primarily in illiquid debt and equity securities of private companies. Most of our investments will not have a readily available market price, and we value these investments at fair value as determined in good faith by our Board, based on, among other things, the input of the Adviser, our Audit Committee and independent third-party valuation firm(s) engaged at the direction of the Board, and in accordance with our valuation policy. There is no single standard for determining fair value. As a result, determining fair value requires that judgment be applied to the specific facts and circumstances of each portfolio investment while employing a consistently applied valuation process for the types of investments we make. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we may realize amounts that are different from the amounts presented and such differences could be material.

Interest Rate Risk

Interest rate sensitivity refers to the change in earnings that may result from changes in the level of interest rates. We intend to fund portions of our investments with borrowings, and at such time, our net investment income will be affected by the difference between the rate at which we invest and the rate at which we borrow. Accordingly, we cannot assure you that a significant change in market interest rates will not have a material adverse effect on our net investment income.

As of March 31, 2021, 99.9% of our debt investments based on fair value were floating rates. Additionally, the weighted average LIBOR floor, based on fair value, of our debt investments was 0.89%.

Based on our Consolidated Statements of Assets and Liabilities as of March 31, 2021, the following table shows the annualized impact on net income of hypothetical base rate changes in interest rates on our debt investments (considering interest rate floors for floating rate instruments) assuming each floating rate investment is subject to 3-month LIBOR and there are no changes in our investment and borrowing structure:

 

($ in millions)

 

Interest Income

 

 

Interest Expense

 

 

Net Income

 

Up 300 basis points

 

$

250.6

 

 

$

92.2

 

 

$

158.4

 

Up 200 basis points

 

$

140.9

 

 

$

61.5

 

 

$

79.4

 

Up 100 basis points

 

$

31.6

 

 

$

30.7

 

 

$

0.9

 

Up 50 basis points

 

$

6.2

 

 

$

15.4

 

 

$

(9.2

)

Down 25 basis points

 

$

(2.3

)

 

$

(6.3

)

 

$

4.0

 

We may in the future hedge against interest rate fluctuations by using hedging instruments such as additional interest rate swaps, futures, options, and forward contracts. While hedging activities may mitigate our exposure to adverse fluctuations in interest rates, certain hedging transactions that we may enter into in the future, such as interest rate swap agreements, may also limit our ability to participate in the benefits of lower interest rates with respect to our portfolio investments.

Currency Risk

From time to time, we may make investments that are denominated in a foreign currency. These investments are translated into U.S. dollars at each balance sheet date, exposing us to movements in foreign exchange rates. We may employ hedging techniques to minimize these risks, but we cannot assure you that such strategies will be effective or without risk to us. We may seek to utilize instruments such as, but not limited to, forward contracts to seek to hedge against fluctuations in the relative values of our portfolio positions from changes in currency exchange rates. We also have the ability to borrow in certain foreign currencies under our credit facilities. Instead of entering into a foreign currency forward contract in connection with loans or other investments we have made that are denominated in a foreign currency, we may borrow in that currency to establish a natural hedge against our loan or investment. To the extent the loan or investment is based on a floating rate other than a rate under which we can borrow under our credit facilities, we may seek to utilize interest rate derivatives to hedge our exposure to changes in the associated rate.


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Item 4. Controls and Procedures

 

(a)

Evaluation of Disclosure Controls and Procedures

In accordance with Rules 13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q and determined that our disclosure controls and procedures are effective as of the end of the period covered by the Quarterly Report on Form 10-Q.

 

(b)

Changes in Internal Controls Over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


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PART II. OTHER INFORMATION

 

Item 1. Legal Proceedings

Neither we nor the Adviser are currently subject to any material legal proceedings, nor, to our knowledge, are any material legal proceeding threatened against us. 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 contracts with our portfolio companies. Our business is also subject to extensive regulation, which may result in regulatory proceedings against us. While the outcome of any such future legal or regulatory proceedings cannot be predicted with certainty, we do not expect that any such future proceedings will have a material effect upon our financial condition or results of operations.


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Item 1A. Risk Factors

 

In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in Part I, “ITEM 1A. RISK FACTORS” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which could materially affect our business, financial condition and/or operating results. The risks described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2020 are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.

 

The interest rates of our term loans to our portfolio companies that extend beyond 2021 might be subject to change based on recent regulatory changes, including the decommissioning of LIBOR.

LIBOR is the basic rate of interest used in lending transactions between banks on the London interbank market and is widely used as a reference for setting the interest rate on loans globally. We typically use LIBOR as a reference rate in term loans we extend to portfolio companies such that the interest due to us pursuant to a term loan extended to a portfolio company is calculated using LIBOR. The terms of our debt investments generally include minimum interest rate floors which are calculated based on LIBOR.

On March 5, 2021, the United Kingdom's Financial Conduct Authority (the "FCA"), which regulates LIBOR, announced that it will not compel panel banks to contribute to the overnight 1, 3, 6 and 12 months USA LIBOR tenors after June 30, 2023 and all other tenors after December 31, 2021. It is unclear if at that time LIBOR will cease to exist or if new methods of calculating LIBOR will be established such that it continues to exist after 2021. Central banks and regulators in a number of major jurisdictions (for example, United States, United Kingdom, European Union, Switzerland and Japan) have convened working groups to find, and implement the transition to, suitable replacements for interbank offered rates ("IBORs"). To identify a successor rate for U.S. dollar LIBOR, the Alternative Reference Rates Committee ("ARRC"), a U.S.-based group convened by the U.S. Federal Reserve Board and the Federal Reserve Bank of New York, was formed. The ARRC has identified the Secured Overnight Financing Rate ("SOFR") as its preferred alternative rate for LIBOR. SOFR is a measure of the cost of borrowing cash overnight, collateralized by U.S. Treasury securities, and is based on directly observable U.S. Treasury-backed repurchase transactions. In addition, on March 25, 2020, the FCA stated that although the central assumption that firms cannot rely on LIBOR being published after the end of 2021 has not changed, the outbreak of COVID-19 has impacted the timing of many firms' transition planning, and the FCA will continue to assess the impact of the COVID-19 outbreak on transition timelines and update the marketplace as soon as possible. Although SOFR appears to be the preferred replacement rate for U.S. dollar LIBOR, at this time, it is not possible to predict the effect of any such changes, any establishment of alternative reference rates or other reforms to LIBOR that may be enacted in the United States, United Kingdom or elsewhere or, whether the COVID-19 outbreak will have further effect on LIBOR transition plans.

The elimination of LIBOR or any other changes or reforms to the determination or supervision of LIBOR could have an adverse impact on the market value of and/or transferability of any LIBOR-linked securities, loans, and other financial obligations or extensions of credit held by or due to us or on our overall financial condition or results of operations. In addition, while the majority of our LIBOR-linked loans contemplate that LIBOR may cease to exist and allow for amendment to a new base rate without the approval of 100% of the lenders, if LIBOR ceases to exist, we will still need to renegotiate the credit agreements extending beyond 2021 with our portfolio companies that utilize LIBOR as a factor in determining the interest rate, in order to replace LIBOR with the new standard that is established, which may have an adverse effect on our overall financial condition or results of operations. Following the replacement of LIBOR, some or all of these credit agreements may bear interest at a lower interest rate, which could have an adverse impact on the value and liquidity of our investment in these portfolio companies and, as a result on our results of operations. Moreover, if LIBOR ceases to exist, we may need to renegotiate certain terms of our credit facilities. If we are unable to do so, amounts drawn under our credit facilities may bear interest at a higher rate, which would increase the cost of our borrowings and, in turn, affect our results of operations.

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

Other than the shares issued pursuant to our dividend reinvestment plan, we did not sell any unregistered equity securities, except as previously disclosed in certain 8-Ks filed with the SEC.

On January 19, 2021, pursuant to our dividend reinvestment plan, we issued 1,435,099 shares of our common stock, at a price of $13.34 per share, to stockholders of record as of December 31, 2020 that did not opt out of our dividend reinvestment plan in order to satisfy the reinvestment portion of our dividends. This issuance was not subject to the registration requirements of the Securities Act of 1933, as amended.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.


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Item 6. Exhibits, Financial Statement Schedules

 

Exhibit

Number

 

Description of Exhibits

3.1

 

Articles of Amendment and Restatement, dated March 1, 2016 (incorporated by reference to Exhibit 3.1 to the Company's Registration Statement on Form 10 filed on April 11, 2016).

 

 

3.3

 

Bylaws, dated January 11, 2016 (incorporated by reference to Exhibit 3.2 to the Company's Quarterly Report on Form 10-Q filed on April 11, 2016).

 

 

10.1*

 

Second Amendment to Credit Agreement, dated as of March 15, 2021, by and among ORCC Financing IV LLC, as borrower, Societe Generale, as administrative agent, State Street Bank and Trust Company, as collateral agent, collateral administrator and collateral custodian, Cortland Capital Market Services LLC, as document custodian, and the lenders party thereto.

10.2*

 

Omnibus Amendment to Transaction Documents, dated as of March 17, 2021, among ORCC Financing III LLC, Owl Rock Capital Corporation, Deutsche Bank AG, New York Branch, State Street Bank and Trust Company and Cortland Capital Market Services LLC.

31.1*

 

Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 

 

31.2*

 

Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

 

 

32.1**

 

Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

32.2**

 

Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

 

________________

*Filed herein.

**Furnished herein.

 

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized. 

 

 

 

Owl Rock Capital Corporation

 

Date: May 5, 2021

 

 

By:

/s/ Craig W. Packer

 

 

 

Craig W. Packer

 

 

 

Chief Executive Officer

 

 

Owl Rock Capital Corporation

 

 

 

 

 

Date: May 5, 2021

 

 

By:

/s/ Alan Kirshenbaum

 

 

 

Alan Kirshenbaum

 

 

 

Chief Operating Officer and Chief Financial Officer

 

 

131