BlackRock TCP Capital Corp

Previous wording

our ability to maintain our qualification as a RIC and as a BDC; and

Current wording

our ability to maintain our qualification as a RIC and as a BDC;

Previous wording

The Company is a Delaware corporation formed on April 2, 2012 and is an externally managed, closed-end, non-diversified management investment company. The Company was formed through the conversion of a pre-existing closed-end investment company. The Company elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). Our investment objective is to seek to achieve high total returns through current income and capital appreciation, with an emphasis on principal protection. We invest primarily in the debt of middle-market companies as well as small businesses, including senior secured loans, junior loans, mezzanine debt and bonds. Such investments may include an equity component, and, to a lesser extent, we may make equity investments directly. Certain investment operations are conducted through the Company’s wholly-owned subsidiaries, Special Value Continuation Partners LLC, a Delaware limited liability company (“SVCP”), TCPC Funding I, LLC (“TCPC Funding”), TCPC Funding II, LLC ("TCPC Funding II") TCPC SBIC, LP, a Delaware limited partnership (the “SBIC”) and BCIC Merger Sub, LLC, a Delaware limited liability company and a wholly-owned subsidiary of SVCP (“Merger Sub”). SVCP was organized as a limited partnership and had elected to be regulated as a BDC under the 1940 Act through July 31, 2018. On August 1, 2018, SVCP withdrew its election to be regulated as a BDC under the 1940 Act and withdrew the registration of its common limited partner interests under Section 12(g) of the 1934 Act and, on August 2, 2018, terminated its general partner, Series H of SVOF/MM, LLC, and converted to a Delaware limited liability company. Series H of SVOF/MM, LLC (“SVOF/MM”) serves as the administrator (the “Administrator”) of the Company. The managing member of SVOF/MM is Tennenbaum Capital Partners, LLC (the “Advisor”), which serves as the investment manager to the Company, TCPC Funding, TCPC Funding II and the SBIC. On August 1, 2018, the Advisor merged with and into a wholly owned subsidiary of BlackRock Capital Investment Advisors, LLC, an indirect wholly owned subsidiary of BlackRock, Inc. with the Advisor as the surviving entity. The SBIC was organized as a Delaware limited partnership in June 2013. On April 22, 2014, the SBIC received a license from the United States Small Business Administration (the “SBA”) to operate as a small business investment company under the provisions of Section 301(c) of the Small Business Investment Act of 1958.

Current wording

The Company is a Delaware corporation formed on April 2, 2012 and is an externally managed, closed-end, non-diversified management investment company. The Company was formed through the conversion of a pre-existing closed-end investment company. The Company elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). Our investment objective is to seek to achieve high total returns through current income and capital appreciation, with an emphasis on principal protection. We invest primarily in the debt of middle-market companies as well as small businesses, including senior secured loans, junior loans, mezzanine debt and bonds. Such investments may include an equity component, and, to a lesser extent, we may make equity investments directly. Certain investment operations are conducted through the Company’s wholly-owned subsidiaries, Special Value Continuation Partners LLC, a Delaware limited liability company (“SVCP”), TCPC Funding I, LLC (“TCPC Funding”), TCPC Funding II, LLC ("TCPC Funding II"), TCPC SBIC, LP, a Delaware limited partnership (the “SBIC”) and BCIC Merger Sub, LLC, a Delaware limited liability company and a wholly-owned subsidiary of SVCP (“Merger Sub”). SVCP was organized as a limited partnership and had elected to be regulated as a BDC under the 1940 Act through July 31, 2018. On August 1, 2018, SVCP withdrew its election to be regulated as a BDC under the 1940 Act and withdrew the registration of its common limited partner interests under Section 12(g) of the 1934 Act and, on August 2, 2018, terminated its general partner, Series H of SVOF/MM, LLC, and converted to a Delaware limited liability company. Series H of SVOF/MM, LLC (“SVOF/MM”) serves as the administrator (the “Administrator”) of the Company. The managing member of SVOF/MM is Tennenbaum Capital Partners, LLC (the “Advisor”), which serves as the investment manager to the Company, TCPC Funding, TCPC Funding II and the SBIC. On August 1, 2018, the Advisor merged with and into a wholly owned subsidiary of BlackRock Capital Investment Advisors, LLC ("BCIA"), an indirect wholly owned subsidiary of BlackRock, Inc. with the Advisor as the surviving entity. The SBIC was organized as a Delaware limited partnership in June 2013. On April 22, 2014, the SBIC received a license from the United States Small Business Administration (the “SBA”) to operate as a small business investment company under the provisions of Section 301(c) of the Small Business Investment Act of 1958.

Previous wording

Our leverage program is comprised of $300.0 million in available debt under a revolving, multi-currency credit facility issued by SVCP (the “Operating Facility”), $200.0 million in available debt under a senior secured revolving credit facility issued by TCPC Funding II (“Funding Facility II”), amounts outstanding under a senior secured revolving credit facility originally issued by BCIC and assumed by Merger Sub ("Merger Sub Facility"), unsecured notes due December 2025 originally issued by BCIC and assumed by Merger Sub (the "2025 Notes"), $325.0 million in senior unsecured notes issued by the Company maturing in 2026 (the “2026 Notes”), $325.0 million in senior unsecured notes issued by the Company maturing in 2029 (the “2029 Notes”) and $141.5 million in committed leverage from the SBA (the “SBA Program” and, together with the Operating Facility, Funding Facility II, Merger Sub Facility, the 2025 Notes, the 2026 Notes and the 2029 Notes, the “Leverage Program”). Prior to being repaid on March 1, 2022, debt included $140.0 million in Convertible unsecured notes due March 2022 issued by the Company (the "2022 Convertible Notes"). Prior to being repaid on August 23, 2024, debt included $250.0 million in unsecured notes due August 2024 issued by the Company (the "2024 Notes").

Current wording

Our leverage program is comprised of $300.0 million in available debt under a revolving, multi-currency credit facility issued by SVCP (the “Operating Facility”), $200.0 million in available debt under a senior secured revolving credit facility issued by TCPC Funding II (“Funding Facility II”), amounts outstanding under a senior secured revolving credit facility originally issued by BlackRock Capital Investment Corporation, a Delaware corporation ("BCIC"), and assumed by Merger Sub ("Merger Sub Facility"), unsecured notes due December 2025 originally issued by BCIC and assumed by Merger Sub (the "2025 Notes"), $325.0 million in senior unsecured notes issued by the Company maturing in 2026 (the “2026 Notes”), $325.0 million in senior unsecured notes issued by the Company maturing in 2029 (the “2029 Notes”) and $132.0 million in committed leverage from the SBA (the “SBA Program”) and, together with the Operating Facility, Funding Facility II, Merger Sub Facility, the 2025 Notes, the 2026 Notes and the 2029 Notes, the “Leverage Program”). Prior to being repaid on August 23, 2024, debt included $250.0 million in unsecured notes due August 2024 issued by the Company (the "2024 Notes").

Previous wording

On September 6, 2023, the Company entered into the Merger Agreement with BCIC, Merger Sub, and, solely for the limited purposes set forth therein, BCIA and the Advisor. On March 18, 2024, the Company completed its previously announced Merger with BCIC. Pursuant to the Merger Agreement, BCIC was merged with and into Merger Sub, with Merger Sub continuing as the surviving company and as a subsidiary of SVCP. As a result of the Merger, BCIC’s separate existence ceased.

Current wording

On September 6, 2023, the Company entered into an agreement and plan of merger with BCIC, Merger Sub, and, solely for the limited purposes set forth therein, BCIA and the Advisor (such agreement, as amended, the "Merger Agreement"). On March 18, 2024, BCIC merged with and into Merger Sub, with Merger Sub continuing as the surviving company and as a subsidiary of SVCP and an indirect wholly-owned subsidiary of the Company (the "Merger"). As a result of the Merger, BCIC’s separate existence ceased.

Previous wording

In accordance with the terms of the Merger Agreement, at the Closing, each outstanding share of BCIC’s common stock was converted into the right to receive 0.3834 shares (the “Exchange Ratio”) of common stock, par value $0.001 per share of the Company (with BCIC shareholders receiving cash in lieu of fractional shares of the Company’s common stock). As a result of the Merger, the Company issued 27,823,870 shares of its common stock to former BCIC shareholders, after adjustment for BCIC’s shareholders receiving cash in lieu of fractional shares.

Current wording

In accordance with the terms of the Merger Agreement, at the closing of the Merger, each outstanding share of BCIC’s common stock was converted into the right to receive 0.3834 shares (the “Exchange Ratio”) of common stock, par value $0.001 per share of the Company (with BCIC shareholders receiving cash in lieu of fractional shares of the Company’s common stock). As a result of the Merger, the Company issued 27,823,870 shares of its common stock to former BCIC shareholders, after adjustment for BCIC’s shareholders receiving cash in lieu of fractional shares.

Previous wording

As a BDC, we are required to comply with certain regulatory requirements. For instance, we generally have to invest at least 70% of our total assets in “qualifying assets,” including securities and indebtedness of private U.S. companies, public U.S. operating companies whose securities are not listed on a national securities exchange or registered under the Securities Exchange Act of 1934, as amended, public domestic operating companies having a market capitalization of less than $250.0 million, cash, cash equivalents, U.S. government securities and high-quality debt investments that mature in one year or less. We are also permitted to make certain follow-on investments in companies that were eligible portfolio companies at the time of initial investment but that no longer meet the definition. As of September 30, 2024, 83.1% of our total assets were invested in qualifying assets.

Current wording

As a BDC, we are required to comply with certain regulatory requirements. For instance, we generally have to invest at least 70% of our total assets in “qualifying assets,” including securities and indebtedness of private U.S. companies, public U.S. operating companies whose securities are not listed on a national securities exchange or registered under the Securities Exchange Act of 1934, as amended, public domestic operating companies having a market capitalization of less than $250.0 million, cash, cash equivalents, U.S. government securities and high-quality debt investments that mature in one year or less. We are also permitted to make certain follow-on investments in companies that were eligible portfolio companies at the time of initial investment but that no longer meet the definition. As of March 31, 2025, 82.6% of our total assets were invested in qualifying assets.

Previous wording

In connection with the Merger, the Company and the Advisor entered into the Amended and Restated Investment Advisory Agreement, pursuant to which the Advisor reduced its base management fee rate for managing the Company from 1.50% to 1.25% on assets equal to or below 200% of the net asset value of the Company with no change to the basis of calculation. Prior to the Closing, the Advisor’s base management fee rate for managing the Company was 1.50% on assets equal to or below 200% of the net asset value of the Company. The base management fee rate on assets that exceed 200% of the net asset value of the Company remains 1.00%. The Company also entered into the Fee Waiver Agreement with the Advisor. The Fee Waiver Agreement provided that the Advisor will waive all or a portion of its advisory fees to the extent the adjusted net investment income of the Company on a per share basis (determined by dividing the adjusted net investment income of the Company by the weighted average outstanding shares of the Company during the relevant quarter) is less than $0.32 per share in any of the first four (4) fiscal quarters ending after the Closing (the first of which will be the quarter in which the Closing occurred) to the extent there are sufficient advisory fees to cover such deficit (the waiver amount in a given quarter cannot exceed the total advisory fees for such quarter).

Current wording

In connection with the Merger, the Company and the Advisor entered into an amended and restated investment advisory agreement (the "Amended and Restated Investment Advisory Agreement"), pursuant to which the Advisor reduced its base management fee rate for managing the Company from 1.50% to 1.25% on assets equal to or below 200% of the net asset value of the Company with no change to the basis of calculation. Prior to the Closing, the Advisor’s base management fee rate for managing the Company was 1.50% on assets equal to or below 200% of the net asset value of the Company. The base management fee rate on assets that exceed 200% of the net asset value of the Company remains 1.00%. The Company also entered into a fee waiver agreement with the Advisor (the "Fee Waiver Agreement"). The Fee Waiver Agreement provided that the Advisor will waive all or a portion of its advisory fees to the extent the adjusted net investment income of the Company on a per share basis (determined by dividing the adjusted net investment income of the Company by the weighted average outstanding shares of the Company during the relevant quarter) is less than $0.32 per share in any of the first four (4) fiscal quarters ending after the Closing (the first of which will be the quarter in which the Closing occurred) to the extent there are sufficient advisory fees to cover such deficit (the waiver amount in a given quarter cannot exceed the total advisory fees for such quarter). On February 24, 2025, the Advisor voluntarily agreed to waive one third of its management fee for each of the first three quarters of 2025, starting on January 1, 2025 and ending on September 30, 2025. For the three months ended March 31, 2025, the Advisor waived $1.8 million in management fees.

Previous wording

As of September 30, 2024, 0.0% of our investments were categorized as Level 1, 1.5% were categorized as Level 2, 98.4% were categorized as Level 3 investments valued based on valuations by independent third-party sources, and 0.1% were categorized as Level 3 investments valued based on valuations by the Valuation Designee.

Current wording

As of March 31, 2025, 0.0% of our investments were categorized as Level 1, 1.2% were categorized as Level 2, 98.7% were categorized as Level 3 investments valued based on valuations by independent third-party sources, and 0.1% were categorized as Level 3 investments valued based on valuations by the Valuation Designee.

Previous wording

As of December 31, 2023, 0.0% of our investments were categorized as Level 1, 3.0% were categorized as Level 2, 96.9% were categorized as Level 3 investments valued based on valuations by independent third-party sources, and 0.1% were categorized as Level 3 investments valued based on valuations by the Valuation Designee.

Current wording

As of December 31, 2024, 0.0% of our investments were categorized as Level 1, 1.6% were categorized as Level 2, 98.3% were categorized as Level 3 investments valued based on valuations by independent third-party sources, and 0.1% were categorized as Level 3 investments valued based on valuations by the Valuation Designee.

Previous wording

During the nine months ended September 30, 2024, we invested approximately $809.5 million, of which $587.0 million of investments were acquired as a result of the Merger which were comprised of 95.8% in senior secured loans, 3.1% in unsecured or subordinated debt securities and 1.1% in equity investments. The remaining $222.5 million of investments made by the Company during the nine months ended September 30, 2024, included new investments in 15 new and 11 existing portfolio companies, as well as draws made on existing commitments and PIK received on prior investments. Of these investments, $205.2 million, or 92.2% of total acquisitions, were in senior secured loans, and $7.6 million, or 3.4% of total acquisitions, were in senior secured notes. The remaining $9.7 million or 4.4% of total acquisitions, was comprised of equity investments. Additionally, we received approximately $348.5 million in proceeds from sales or repayments of investments during the nine months ended September 30, 2024.

Current wording

During the three months ended March 31, 2024, we invested approximately $607.0 million, of which $587.0 million of investments were acquired as a result of the Merger, which were comprised of 95.8% in senior secured loans, 3.1% in unsecured or subordinated debt securities and 1.1% in equity investments.The remaining $20.0 million of investments made by the Company during the three months ended March 31, 2024, included new investments in 4 new and 3 existing portfolio companies, as well as draws made on existing commitments and PIK received on prior investments. Of these investments, $18.9 million, or 94.5% of total acquisitions, were in senior secured loans. The remaining $1.1 million (5.5% of total acquisitions) was comprised of equity investments. Additionally, we received approximately $24.3 million in proceeds from sales or repayments of investments during the three months ended March 31, 2024.

Previous wording

At September 30, 2024, our consolidated investment portfolio of $1,909.1 million (at fair value) consisted of 156 portfolio companies and was invested 90.9% in debt investments, primarily in senior secured debt. In aggregate, our investment portfolio was invested 87.4% in senior secured loans, 3.1% in senior secured notes, 0.4% in unsecured debt and 9.1% in equity investments. Our average portfolio company investment at fair value was approximately $12.2 million. Our largest portfolio company investment based on fair value was approximately 5.9% of our portfolio and our five largest portfolio company investments based on fair value comprised approximately 19.0% of our portfolio at September 30, 2024.

Current wording

At March 31, 2025, our consolidated investment portfolio of $1,769.3 million (at fair value) consisted of 146 portfolio companies and was invested 90.1% in debt investments, primarily in senior secured debt. In aggregate, our investment portfolio was invested 86.6% in senior secured loans, 3.4% in senior secured notes, 0.1% in unsecured debt and 9.9% in equity investments. Our average portfolio company investment at fair value was approximately $12.1 million. Our largest portfolio company investment based on fair value was approximately 6.3% of our portfolio and our five largest portfolio company investments based on fair value comprised approximately 19.8% of our portfolio at March 31, 2025.

Previous wording

At December 31, 2023, our investment portfolio of $1,554.9 million (at fair value) consisted of 142 portfolio companies and was invested 89.3% in debt investments, primarily in senior secured debt. In aggregate, our investment portfolio was invested 86.0% in senior secured loans, 3.3% in senior secured notes and 10.7% in equity investments. Our average portfolio company investment at fair value was approximately $11.0 million. Our largest portfolio company investment based on fair value was approximately 6.6% of our portfolio and our five largest portfolio company investments based on fair value comprised approximately 19.8% of our portfolio at December 31, 2023.

Current wording

At December 31, 2024, our consolidated investment portfolio of $1,794.8 million (at fair value) consisted of 154 portfolio companies and was invested 91.5% in debt investments, primarily in senior secured debt. In aggregate, our investment portfolio was invested 87.9% in senior secured loans, 3.3% in senior secured notes, 0.3% in unsecured debt and 8.5% in equity investments. Our average portfolio company investment at fair value was approximately $11.7 million. Our largest portfolio company investment based on fair value was approximately 6.2% of our portfolio and our five largest portfolio company investments by value comprised approximately 18.3% of our portfolio at December 31, 2024.

Previous wording

The weighted average effective yield of our debt portfolio based on fair value was 13.4% at September 30, 2024 and 14.1% at December 31, 2023, excluding non-accrual and non-income producing loans. The weighted average effective yield of our total portfolio based on fair value was 11.9% at September 30, 2024 and 13.3% at December 31, 2023. At September 30, 2024, 92.7% of debt investments in our portfolio bore interest based on floating rates, such as SOFR, EURIBOR, the Federal Funds Rate or the Prime Rate, and 7.3% bore interest at fixed rates. The percentage of floating rate debt investments in our portfolio that were subject to an interest rate floor was 97.0% at September 30, 2024. Debt and preferred equity investments in ten portfolio companies were on non-accrual status as of September 30, 2024, representing 3.8% of the portfolio at fair value and 9.3% at cost. At December 31, 2023, 95.6% of debt investments in our portfolio bore interest based on floating rates, such as SOFR, EURIBOR, the Federal Funds Rate or the Prime Rate, and 4.4% bore interest at fixed rates. The percentage of floating rate debt investments in our portfolio that were subject to an interest rate floor was 94.0% at December 31, 2023. Debt investments in four portfolio companies were on non-accrual status as of December 31, 2023, representing 2.0% of the portfolio at fair value and 3.7% at cost.

Current wording

The weighted average effective yield of our debt portfolio based on fair value was 12.2% at March 31, 2025 and 12.4% at December 31, 2024, excluding non-accrual and non-income producing loans. The weighted average effective yield of our total portfolio based on fair value was 10.8% at March 31, 2025 and 11.1% at December 31, 2024. At March 31, 2025, 94.0% of debt investments in our portfolio bore interest based on floating rates, such as SOFR, EURIBOR, the Federal Funds Rate or the Prime Rate, and 6.0% bore interest at fixed rates. The percentage of floating rate debt investments in our portfolio that were subject to an interest rate floor was 97.9% at March 31, 2025. Debt and preferred equity investments in eight portfolio companies were on non-accrual status as of March 31, 2025, representing 4.4% of the portfolio at fair value and 12.6% at cost. At December 31, 2024, 94.5% of debt investments in our portfolio bore interest based on floating rates, such as SOFR, EURIBOR, the Federal Funds Rate or the Prime Rate, and 5.5% bore interest at fixed rates. The percentage of floating rate debt investments in our portfolio that were subject to an interest rate floor was 97.5% at December 31, 2024. Debt and preferred equity investments in twelve portfolio companies were on non-accrual status as of December 31, 2024, representing 5.6% of the portfolio at fair value and 14.4% at cost.

Previous wording

Investment income totaled $70.9 million and $54.2 million, respectively, for the three months ended September 30, 2024 and 2023, of which $69.2 million and $53.3 million were attributable to interest and fees on our debt investments, $1.6 million and $0.9 million to dividend income and $0.1 million and $0.0 million to other income, respectively. Included in interest and fees on our debt investments were $6.7 million and $0.7 million of non-recurring income related to prepayments and $0.5 million and $0.4 million in amendment fees for the three months ended September 30, 2024 and 2023, respectively. The increase in investment income for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 primarily reflects an increase in interest income due to additional investment income earned on investments acquired as a result of the Merger and higher SOFR rates during the three months ended September 30, 2024.

Current wording

Investment income totaled $55.9 million and $55.7 million, respectively, for the three months ended March 31, 2025 and 2024, of which $52.6 million and $54.7 million were attributable to interest and fees on our debt investments, $3.3 million and $1.0 million to dividend income and $0.0 million and $0.0 million to other income, respectively. Included in interest and fees on our debt investments were $2.4 million and $0.4 million of non-recurring income related to prepayments and $0.2 million and $0.1 million in amendment fees for the three months ended March 31, 2025 and 2024, respectively. The increase in investment income for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 primarily reflects an increase in dividend income and additional investment income earned on investments acquired as a result of the Merger, partially offset by lower interest income due to lower SOFR rates during the three months ended March 31, 2025.

Previous wording

Total operating expenses for the three months ended September 30, 2024 and 2023 were $37.1 million and $25.9 million, respectively, comprised of $21.2 million and $12.1 million in interest expense and related fees, $6.5 million and $6.0 million in incentive fee expense, $6.2 million and $6.1 million in base management fees, $0.8 million and $0.7 million in professional fees, $0.5 million and $0.4 million in administrative expenses and $1.9 million and $0.6 million in other expenses, respectively. The increase in operating expenses for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 primarily reflects an increase in interest expense as a result of the higher debt outstanding assumed as a result of the Merger and the issuance of the 2029 Notes and due to higher SOFR rates during the three months ended September 30, 2024, in addition to an increase in incentive fee expense from higher pre-incentive net investment income earned during the three months ended September 30, 2024.

Current wording

Total operating expenses for the three months ended March 31, 2025 and 2024 were $23.7 million and $27.5 million, respectively, comprised of $17.1 million and $13.2 million in interest expense and related fees, $5.5 million and $5.8 million in base management fees, $1.8 million and $0.0 million in management fee waivers, $0.9 million and $0.9 million in professional fees, $0.6 million and $0.6 million in administrative expenses, $0.0 million and $5.9 million in incentive fee expense, $1.4 million and $1.1 million in other expenses, respectively. The decrease in operating expenses for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 primarily reflects a decrease in incentive fee expense due to the Company not accruing incentive fees in the three months ended March 31, 2025 as a result of the Company's cumulative total return not exceeding the total return hurdle and a decrease in management fees due to the application of a management fee waiver during the three months ended March 31, 2025, partially offset by an increase in interest expense as a result of the higher debt outstanding assumed as a result of the Merger and the issuance of the 2029 Notes.

Previous wording

Net investment income was $33.9 million and $28.3 million, respectively, for the three months ended September 30, 2024 and 2023. The increase in net investment income for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 primarily reflects the increase in total investment income, partially offset by the increase in expenses during the three months ended September 30, 2024.

Current wording

Net investment income was $32.2 million and $28.3 million, respectively, for the three months ended March 31, 2025 and 2024. The increase in net investment income for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 primarily reflects the decrease in expenses during the three months ended March 31, 2025.

Previous wording

Net realized gain (loss) for the three months ended September 30, 2024 and 2023 was $(31.4) million and $(0.1) million, respectively. Net realized losses for the three months ended September 30, 2024 was comprised primarily of $24.1 million and $7.4 million in losses from the restructuring of our investments in Pluralsight and McAfee, respectively. Subsequent to its restructuring, our debt investment in Pluralsight is back on accrual status.

Current wording

Net realized gain (loss) for the three months ended March 31, 2025 and 2024 was $(40.9) million and $(0.2) million, respectively. Net realized loss for the three months ended March 31, 2025 was comprised primarily of $24.5 million, $7.6 million, and $6.7 million in losses from the dispositions of our investments in Securus, CIBT, and McAfee, respectively.

Previous wording

For the nine months ended September 30, 2024 and 2023, the change in net unrealized appreciation (depreciation) was $(55.4) million and $1.6 million, respectively. The change in unrealized depreciation of $(55.4) million is net of $21.3 million in unrealized appreciation resulting from a reduction of the cost basis of investments acquired as a result of the Merger from allocation of the purchase discount paid by the Company. The change in net unrealized depreciation for the nine months ended September 30, 2024 primarily reflects a $35.4 million unrealized loss on our investment in Seller-X, a $20.2 million unrealized loss on our investment in Edmentum, a $14.7 million unrealized loss on our investment in Lithium, a $13.3 million unrealized loss on our investment in Razor, and a $7.2 million unrealized loss on our investment in Gordon Brothers, partially offset by $17.0 million, $10.7 million, $6.3 million, and $5.2 million reversals of previous unrealized losses from the restructuring of our investments in Thras.io, Hylan, Perch and McAfee, respectively. The change in net unrealized appreciation for the nine months ended September 30, 2023 primarily reflects a $37.0 million reversal of previously recognized unrealized losses from the reorganization of our investment in Autoalert, offset by a $8.0 million unrealized loss in Hylan, a $6.8 million unrealized loss on our investment in Magenta Buyer, a $5.3 million unrealized loss on our investment in 36th Street, a $5.1 million unrealized loss on our investment in Khoros, a $4.4 million unrealized loss on our investment in Edmentum, a $3.9 million unrealized loss on our investment in Astra Acquisition, and a $3.9 million unrealized loss on our investment in Perch.

Current wording

For the three months ended March 31, 2025 and 2024, the change in net unrealized appreciation (depreciation) was $29.6 million and $(23.0) million, respectively. The change in net unrealized appreciation for the three months ended March 31, 2025 primarily reflects $23.9 million, $7.5 million and $5.3 million reversals of previously recognized unrealized losses from the dispositions of our investments in Securus, CIBT and McAfee, respectively, a $10.8 million unrealized gain on our investment in Job and Talent and a $5.3 million unrealized gain on our investment in AutoAlert, partially offset by an $8.0 million unrealized loss on our investment in Razor, a $2.7 million unrealized loss on our investment in Gordon Brothers, a $2.3 million unrealized loss on our investment in Alpine, and a $2.3 million unrealized loss on our investment in Brook & Whittle. The change in net unrealized depreciation for the three months ended March 31, 2024 of $(23.0) million is net of $21.3 million in unrealized appreciation resulting from a reduction of the cost basis of investments acquired as a result of the Merger from allocation of the purchase discount paid by the Company. The change in net unrealized depreciation for the three months ended March 31, 2024 primarily reflects a $13.4 million unrealized loss on our investment in Edmentum, a $13.2 million unrealized loss on our investment in Razor, a $6.8 million unrealized loss on our investment in Aventiv, a $6.4 million unrealized loss on our investment in Astra, a $3.3 million unrealized loss on our investment in Thras.io and a $3.1 million unrealized loss on our investment in 36th Street Capital, partially offset by a $6.3 million reversal of previously recognized unrealized loss upon the restructure of our investment in Perch.

Previous wording

Incentive fees, included in operating expenses for the three months ended September 30, 2024 and 2023 were $6.5 million and $6.0 million, and for the nine months ended September 30, 2024 and 2023 were $19.2 million and $17.3 million, respectively, and were each payable due to our performance exceeding the cumulative total return threshold during those periods. The increase in incentive fee expense for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023, respectively, was the result of higher pre-incentive fee net investment income earned during the three and nine months ended September 30, 2024 which was driven by higher SOFR rates and additional investment income earned on investments acquired as a result of the Merger.

Current wording

Incentive fees, included in operating expenses for the three months ended March 31, 2025 and 2024 were $0.0 million and $5.9 million. The decrease in incentive fee expense for the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was due to the Company not accruing incentive fees for the three months ended March 31, 2025 as a result of the Company's cumulative total return not exceeding the total return hurdle.

Previous wording

Depending on the level of taxable income earned in a tax year, we may choose to carry forward taxable income in excess of current year dividend distributions from such current year taxable income into the next tax year and pay a 4% excise tax on such income. Any excise tax expense is recorded at year end as such amounts are known. No excise tax was incurred for the nine months ended September 30, 2024.

Current wording

Depending on the level of taxable income earned in a tax year, we may choose to carry forward taxable income in excess of current year dividend distributions from such current year taxable income into the next tax year and pay a 4% excise tax on such income. Any excise tax expense is recorded at year end as such amounts are known. No excise tax was incurred for the three months ended March 31, 2025.

Previous wording

On March 18, 2024, the Company completed its previously announced Merger with BCIC. Pursuant to the Merger Agreement, BCIC was merged with and into Merger Sub, with Merger Sub continuing as the surviving company and as a subsidiary of SVCP. The Merger was considered a tax-free reorganization and the Company has elected to carry forward the historical cost basis of the acquired BCIC investments for tax purposes. As a result of the Merger, BCIC’s separate existence ceased.

Current wording

On March 18, 2024, the Company completed its previously announced Merger with BCIC. Pursuant to the Merger Agreement, BCIC was merged with and into Merger Sub, with Merger Sub continuing as the surviving company and as a subsidiary of SVCP. The

Previous wording

The net increase (decrease) in net assets applicable to common shareholders resulting from operations was $21.6 million and $12.8 million for the three months ended September 30, 2024 and 2023, respectively. The increase in net assets resulting from operations during the three months ended September 30, 2024 was primarily due to higher net investment income and lower net realized and unrealized losses compared to the three months ended September 30, 2023.

Current wording

The net increase (decrease) in net assets applicable to common shareholders resulting from operations was $20.9 million and $5.1 million for the three months ended March 31, 2025 and 2024, respectively. The higher net increase in net assets resulting from operations during the three months ended March 31, 2025 was primarily due to lower net realized and unrealized losses and higher net investment income compared to the three months ended March 31, 2024.

Previous wording

On February 27, 2024, the Board of Directors approved a new dividend reinvestment plan (the “DRIP”) for the Company. The DRIP was effective as of, and will apply to the reinvestment of cash distributions with a record date after March 18, 2024. Under the DRIP, shareholders will automatically receive cash dividends and distributions unless they “opt in” to the DRIP and elect to have their dividends and distributions reinvested in additional shares of the Company’s common stock. Notwithstanding the foregoing, the former shareholders of BCIC that participated in the BCIC dividend reinvestment plan at the time of the Merger have been automatically enrolled in the Company’s DRIP and will have their shares reinvested in additional shares of the Company’s common stock on future distributions, unless they “opt out” of the DRIP. For the nine months ended September 30, 2024, approximately $1.5 million of cash distributions were reinvested for electing Participants through purchase of shares in the open market in accordance with the terms of the DRIP.

Current wording

On February 27, 2024, the Board of Directors approved a new dividend reinvestment plan (the “DRIP”) for the Company. The DRIP was effective as of, and will apply to the reinvestment of cash distributions with a record date after March 18, 2024. Under the DRIP, shareholders will automatically receive cash dividends and distributions unless they “opt in” to the DRIP and elect to have their dividends and distributions reinvested in additional shares of the Company’s common stock. Notwithstanding the foregoing, the former shareholders of BCIC that participated in the BCIC dividend reinvestment plan at the time of the Merger have been automatically enrolled in the Company’s DRIP and will have their shares reinvested in additional shares of the Company’s common stock on future distributions, unless they “opt out” of the DRIP. For the three months ended March 31, 2025, approximately $1.4 million of cash distributions were reinvested for electing Participants through purchase of shares in the open market in accordance with the terms of the DRIP.

Previous wording

On February 24, 2015, the Company’s Board of Directors approved a stock repurchase plan (the “Company Repurchase Plan”) to acquire up to $50.0 million in the aggregate of the Company’s common stock at prices at certain thresholds below the Company’s net asset value per share, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the 1934 Act. The Company Repurchase Plan is designed to allow the Company to repurchase its common stock at times when it otherwise might be prevented from doing so under insider trading laws. The Company Repurchase Plan requires an agent selected by the Company to repurchase shares of common stock on the Company’s behalf if and when the market price per share is at certain thresholds below the most recently reported net asset value per share. Under the plan, the agent will increase the volume of purchases made if the price of the Company’s common stock declines, subject to volume restrictions. The timing and amount of any stock repurchased depends on the terms and conditions of the Company Repurchase Plan, the market price of the common stock and trading volumes, and no assurance can be given that any particular amount of common stock will be repurchased. The Company Repurchase Plan was re-approved on August 1, 2024, to be in effect through the earlier of April 30, 2025, unless further extended or terminated by our Board of Directors, or such time as the approved $50.0 million repurchase amount has been fully utilized, subject to certain conditions. No shares were repurchased by the Company under the Company Repurchase plan for the nine months ended September 30, 2024 and 2023.

Current wording

On February 24, 2015, the Company’s Board of Directors approved a stock repurchase plan (the “Company Repurchase Plan”) to acquire up to $50.0 million in the aggregate of the Company’s common stock at prices at certain thresholds below the Company’s net asset value per share, in accordance with the guidelines specified in Rule 10b-18 and Rule 10b5-1 of the 1934 Act. The Company Repurchase Plan is designed to allow the Company to repurchase its common stock at times when it otherwise might be prevented from doing so under insider trading laws. The Company Repurchase Plan requires an agent selected by the Company to repurchase shares of common stock on the Company’s behalf if and when the market price per share is at certain thresholds below the most recently reported net asset value per share. Under the plan, the agent will increase the volume of purchases made if the price of the Company’s common stock declines, subject to volume restrictions. The timing and amount of any stock repurchased depends on the terms and conditions of the Company Repurchase Plan, the market price of the common stock and trading volumes, and no assurance can be given that any particular amount of common stock will be repurchased. The Company Repurchase Plan was re-approved on April 24, 2024, to be in effect through the earlier of April 30, 2025, unless further extended or terminated by our Board of Directors, or such time as the approved $50.0 million repurchase amount has been fully utilized, subject to certain conditions.

Previous wording

As of September 30, 2024, $113.0 million of the outstanding amount was subject to a SOFR credit adjustment of 0.11%. $8.3 million of the outstanding amount bore interest at a rate of EURIBOR + 2.00%.

Current wording

The outstanding amount was subject to a SOFR credit adjustment of 0.10%.

Previous wording

Effective November 7, 2018, the Company’s Board of Directors, including a “required majority” (as such term is defined in Section 57(o) of the 1940 Act) of our Board of Directors, approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the 1940 Act, as amended by the SBCAA (the “Asset Coverage Ratio Election”), which would have resulted (had the Company not received earlier shareholder approval) in our asset coverage requirement applicable to senior securities being reduced from 200% to 150%, effective on November 7, 2019. On February 8, 2019, the shareholders of the Company approved the Asset Coverage Ratio Election, and, as a result, effective on February 9, 2019, our asset coverage requirement applicable to senior securities was reduced from 200% to 150%. As of September 30, 2024, the Company’s asset coverage ratio was 183.2%.

Current wording

Effective November 7, 2018, the Company’s Board of Directors, including a “required majority” (as such term is defined in Section 57(o) of the 1940 Act) of our Board of Directors, approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the 1940 Act, as amended by the SBCAA (the “Asset Coverage Ratio Election”), which would have resulted (had the Company not received earlier shareholder approval) in our asset coverage requirement applicable to senior securities being reduced from 200% to 150%, effective on November 7, 2019. On February 8, 2019, the shareholders of the Company approved the Asset Coverage Ratio Election, and, as a result, effective on February 9, 2019, our asset coverage requirement applicable to senior securities was reduced from 200% to 150%. As of March 31, 2025, the Company’s asset coverage ratio was 179.0%.

Previous wording

On July 13, 2015, we obtained exemptive relief from the SEC to permit us to exclude debt outstanding under the SBA Debentures from our asset coverage test under the 1940 Act. The exemptive relief provides us with increased flexibility under the 150% asset coverage test by permitting the SBIC to borrow up to $141.5 million more than it would otherwise be able to absent the receipt of this exemptive relief.

Current wording

On July 13, 2015, we obtained exemptive relief from the SEC to permit us to exclude debt outstanding under the SBA Debentures from our asset coverage test under the 1940 Act. The exemptive relief provides us with increased flexibility under the 150% asset coverage test by permitting the SBIC to borrow up to $132.0 million more than it would otherwise be able to absent the receipt of this exemptive relief.

Previous wording

Net cash provided by operating activities during the nine months ended September 30, 2024 was $221.5 million, consisting primarily of $84.8 million in net investment income (net of non-cash income and expenses) and the settlement of dispositions of investments (net of acquisitions) of $136.7 million.

Current wording

Net cash provided by operating activities during the three months ended March 31, 2025 was $52.5 million, consisting primarily of $21.7 million in net investment income (net of non-cash income and expenses) and the settlement of dispositions of investments (net of acquisitions) of $30.8 million.

Previous wording

Net cash used by financing activities was $229.5 million during the nine months ended September 30, 2024, consisting primarily of a $250.0 million repayment of the 2024 Notes, $208.3 million in net credit facility repayments, $85.1 million in dividends paid to common shareholders (including $7.3 million of dividends declared by BCIC prior to the Merger and paid to former BCIC shareholders out of cash and cash equivalents acquired) and $7.5 million in payments of associated debt issuance costs, offset by $321.4 million in proceeds from the issuance of the 2029 Notes.

Current wording

Net cash used by financing activities was $45.0 million during the three months ended March 31, 2025, consisting primarily of a $20.3 million in net credit facility repayments, $24.7 million in dividends paid to common shareholders and $0.0 million in repurchases of shares.

Previous wording

At September 30, 2024, we had $104.2 million in cash and cash equivalents.

Current wording

At March 31, 2025, we had $99.1 million in cash and cash equivalents.

Previous wording

The following tables summarize dividends declared for the nine months ended September 30, 2024 and 2023:

Current wording

The following tables summarize dividends declared for the three months ended March 31, 2025 and 2024:

Previous wording

No dividend reinvestment plan was effective for the nine months ended September 30, 2023.

Current wording

No dividend reinvestment plan was effective for the three months ended March 31, 2024.

Previous wording

From October 1, 2024 through November 5, 2024, the Company has invested approximately $29.5 million primarily in two senior secured loans with a combined effective yield of approximately 10.7%.

Current wording

From April 1, 2025 through May 7, 2025, the Company has invested approximately $43.6 million primarily in two senior secured loans with a combined effective yield of approximately 10.0%.

Previous wording

On October 30, 2024, the Company’s Board of Directors re-approved the Company Repurchase Plan, to be in effect through the earlier of two trading days after the Company’s fourth quarter 2024 earnings release or such time as the approved $50 million repurchase amount has been fully utilized, subject to certain conditions.

Current wording

On April 29, 2025, the Company’s Board of Directors re-approved the Company Repurchase Plan, to be in effect through the earlier of April 30, 2026, unless further extended or terminated by the Company's Board of Directors, or such time as the approved $50 million repurchase amount has been fully utilized, subject to certain conditions.

Previous wording

On November 6, 2024, the Company’s Board of Directors declared a fourth quarter regular dividend of $0.34 per share and a special dividend of $0.10 per share, both payable on December 31, 2024 to shareholders of record as of the close of business on December 17, 2024.

Current wording

On May 8, 2025, the Company’s Board of Directors declared a second quarter regular dividend of $0.25 per share and a special dividend of $0.04 per share, both payable on June 30, 2025 to shareholders of record as of the close of business on June 16, 2025.