Oaktree Specialty Lending Corp

Previous wording

Our investment objective is to generate current income and capital appreciation by providing companies with flexible and innovative financing solutions, including first and second lien loans, unsecured and mezzanine loans, bonds, preferred equity and certain equity co-investments. We may also seek to generate capital appreciation and income through secondary investments at discounts to par in either private or syndicated transactions. Our portfolio may also include certain structured finance and other non-traditional structures. We invest in companies that typically possess resilient business models with strong underlying fundamentals. We intend to deploy capital across credit and economic cycles with a focus on long-term results, which we believe will enable us to build lasting partnerships with financial sponsors and management teams, and we may seek to opportunistically take advantage of dislocations in the financial markets and other situations that may benefit from Oaktree’s credit and structuring expertise. Sponsors may include financial sponsors, such as an institutional investor or a private equity firm, or a strategic entity seeking to invest in a portfolio company. We generally invest in securities that are rated below investment grade by rating agencies or that would be rated below investment grade if they were rated. Below investment grade securities, which are often referred to as “high yield” and “junk,” have predominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal.

Current wording

Our investment objective is to generate current income and capital appreciation by providing companies with flexible and innovative financing solutions, including first lien loans (which may include “unitranche” loans and “last out” first lien loans, which are loans that are second priority behind “first out” first lien loans), second lien loans, unsecured and mezzanine loans, bonds, preferred equity and certain equity co-investments. We may also seek to generate capital appreciation and income through secondary investments at discounts to par in either private or syndicated transactions. Our portfolio may also include certain structured finance and other non-traditional structures. We invest in companies that typically possess resilient business models with strong underlying fundamentals. We intend to deploy capital across credit and economic cycles with a focus on long-term results, which we believe will enable us to build lasting partnerships with financial sponsors and management teams, and we may seek to opportunistically take advantage of dislocations in the financial markets and other situations that may benefit from Oaktree’s credit and structuring expertise. Sponsors may include financial sponsors, such as an institutional investor or a private equity firm, or a strategic entity seeking to invest in a portfolio company. We generally invest in securities that are rated below investment grade by rating agencies or that would be rated below investment grade if they were rated. Below investment grade securities, which are often referred to as “high yield” and “junk,” have predominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal.

Previous wording

Global financial markets have experienced an increase in volatility over the last few years amid higher inflation, elevated interest rates, and concern over a potential slowdown in economic activity. As inflation pressures have eased in recent months, the Federal Reserve has relaxed its monetary policies and cut the federal funds rate to support the broader economy. However, various macroeconomic headwinds remain including ongoing conflict in the Middle East and signs of an economic slowdown outside the United States. These uncertainties can ultimately impact the overall supply and demand of the market through changing spreads, deal terms and structures and equity purchase price multiples.

Current wording

Global financial markets have experienced an increase in volatility over the last few years amid higher inflation, elevated interest rates, tariffs and concern over a potential slowdown in economic activity. As inflation pressures have eased in recent months, the Federal Reserve has relaxed its monetary policies and cut the federal funds rate to support the broader economy. However, various macroeconomic headwinds remain, including ongoing conflict in the Middle East, signs of an economic slowdown outside the United States and threats of tariffs and a trade war . These uncertainties can ultimately impact the overall supply and demand of the market through changing spreads, deal terms and structures and equity purchase price multiples.

Previous wording

The fair value of our investments as of December 31, 2024 and September 30, 2024 was determined by Oaktree, as our valuation designee. We have and will continue to engage independent valuation firms to provide assistance each quarter regarding the determination of the fair value of a portion of our portfolio securities for which market quotations are not readily available or are readily available but deemed not reflective of the fair value of the investment. As of December 31, 2024, 96.8% of our portfolio at fair value was valued either based on market quotations, the transactions precedent approach or corroborated by independent valuation firms.

Current wording

The fair value of our investments as of March 31, 2025 and September 30, 2024 was determined by Oaktree, as our valuation designee. We have and will continue to engage independent valuation firms to provide assistance each quarter regarding the determination of the fair value of a portion of our portfolio securities for which market quotations are not readily available or are readily available but deemed not reflective of the fair value of the investment. As of March 31, 2025, 100% of our portfolio at fair value was valued either based on market quotations, the transactions precedent approach or corroborated by independent valuation firms.

Previous wording

As of December 31, 2024, we held $2,835.3 million of investments at fair value, down from $3,021.3 million held at September 30, 2024, primarily driven by sales of investments and net realized and unrealized losses during the three months ended December 31, 2024. As of December 31, 2024 and September 30, 2024, approximately 91.9% and 94.5%, respectively, of our total assets represented investments at fair value.

Current wording

As of March 31, 2025, we held $2,892.8 million of investments at fair value, down from $3,021.3 million held at September 30, 2024, primarily driven by net realized and unrealized losses and sales of investments during the six months ended March 31, 2025. As of March 31, 2025 and September 30, 2024, approximately 93.9% and 94.5%, respectively, of our total assets represented investments at fair value.

Previous wording

Interest income, adjusted for accretion of original issue discount, or OID, is recorded on an accrual basis to the extent that such amounts are expected to be collected. We stop accruing interest on investments when it is determined that interest is no longer collectible. Investments that are expected to pay regularly scheduled interest in cash are generally placed on non-accrual status when there is reasonable doubt that principal or interest cash payments will be collected. Cash interest payments received on investments may be recognized as income or a return of capital depending upon management’s judgment. A non-accrual investment is restored to accrual status if past due principal and interest are paid in cash, and the portfolio company, in management’s judgment, is likely to continue timely payment of its remaining obligations. As of December 31, 2024, there were nine investments on non-accrual status that in the aggregate represented 5.1% and 3.9% of total debt investments at cost and fair value, respectively. As of September 30, 2024, there were nine investments on non-accrual status that in aggregate represented 4.9% and 4.0% of total debt investments at cost and fair value, respectively.

Current wording

Interest income, adjusted for accretion of original issue discount, or OID, is recorded on an accrual basis to the extent that such amounts are expected to be collected. We stop accruing interest on investments when it is determined that interest is no longer collectible. Investments that are expected to pay regularly scheduled interest in cash are generally placed on non-accrual status when there is reasonable doubt that principal or interest cash payments will be collected. Cash interest payments received on investments may be recognized as income or a return of capital depending upon management’s judgment. A non-accrual investment is restored to accrual status if past due principal and interest are paid in cash, and the portfolio company, in management’s judgment, is likely to continue timely payment of its remaining obligations. As of March 31, 2025, there were ten investments on non-accrual status that in the aggregate represented 7.6% and 4.6% of total debt investments at cost and fair value, respectively. As of September 30, 2024, there were nine investments on non-accrual status that in aggregate represented 4.9% and 4.0% of total debt investments at cost and fair value, respectively.

Previous wording

During the three months ended December 31, 2024, we originated $198.1 million of investment commitments in 5 new and 8 existing portfolio companies and funded $201.3 million of investments.

Current wording

During the six months ended March 31, 2025, we originated $605.1 million of investment commitments in 29 new and 16 existing portfolio companies and funded $607.1 million of investments.

Previous wording

During the three months ended December 31, 2024, we received $352.4 million of proceeds from prepayments, exits, other paydowns and sales and exited 13 portfolio companies.

Current wording

During the six months ended March 31, 2025, we received $631.8 million of proceeds from prepayments, exits, other paydowns and sales and exited 21 portfolio companies.

Previous wording

Both the cost and fair value of our SLF JV I Notes were $112.7 million as of each of December 31, 2024 and September 30, 2024. We earned interest income of $3.4 million and $3.6 million on the SLF JV I Notes for the three months ended December 31, 2024 and 2023, respectively. As of December 31, 2024, the SLF JV I Notes bore interest at a rate of one-month SOFR plus 7.00% per annum with a SOFR floor of 1.00% and will mature on December 29, 2028.

Current wording

Both the cost and fair value of our SLF JV I Notes were $112.7 million as of each of March 31, 2025 and September 30, 2024. We earned interest income of $3.2 million and $6.7 million on the SLF JV I Notes for the three and six months ended March 31, 2025, respectively. The Company earned interest income of $3.5 million and $7.1 million on the SLF JV I Notes for the three and six months ended March 31, 2024, respectively. As of March 31, 2025, the SLF JV I Notes bore interest at a rate of one-month SOFR plus 7.00% per annum with a SOFR floor of 1.00% and will mature on December 29, 2028.

Previous wording

The cost and fair value of the LLC equity interests in SLF JV I held by us was $54.8 million and $22.7 million, respectively, as of December 31, 2024, and $54.8 million and $22.5 million, respectively, as of September 30, 2024. We earned $0.7 million and $1.4 million in dividend income for the three months ended December 31, 2024 and 2023, respectively, with respect to our investment in the LLC equity interests of SLF JV I.

Current wording

The cost and fair value of the LLC equity interests in SLF JV I held by us was $54.8 million and $16.0 million, respectively, as of March 31, 2025, and $54.8 million and $22.5 million, respectively, as of September 30, 2024. We earned $0.7 million and $1.4 million in dividend income for the three and six months ended March 31, 2025, respectively, with respect to our investment in the LLC equity interests of SLF JV I. We earned $1.4 million and $2.8 million in dividend income for the three and six months ended March 31, 2024, respectively, with respect to its investment in the LLC equity interests of SLF JV I.

Previous wording

On March 19, 2021, we became party to the LLC agreement of the Glick JV. The Glick JV invests primarily in senior secured loans of middle-market companies. We co-invest in these securities with GF Equity Funding through the Glick JV. The Glick JV is managed by a four person Board of Directors, two of whom are selected by us and two of whom are selected by GF Equity Funding. All portfolio decisions and investment decisions in respect of the Glick JV must be approved by the Glick JV investment committee, consisting of one representative selected by us and one representative selected by GF Equity Funding (with approval from a representative of each required). Since we do not have a controlling financial interest in the Glick JV, we do not consolidate the Glick JV. The Glick JV is not an "eligible portfolio company" as defined in section 2(a)(46) of the Investment Company Act. The Glick JV is capitalized as transactions are completed. The members provide capital to the Glick JV in exchange for LLC equity interests, and we and GF Debt Funding 2014 LLC, or GF Debt Funding, an entity advised by affiliates of GF Equity Funding, provide capital to the Glick JV in exchange for subordinated notes issued by the Glick JV, or the Glick JV Notes. The Glick JV Notes are junior in right of payment to the repayment of temporary contributions made by us to fund investments of the Glick JV that are repaid when GF Equity Funding and GF Debt Funding make their capital contributions and fund their Glick JV Notes, respectively.

Current wording

On March 19, 2021, we became party to the LLC agreement of the Glick JV. The Glick JV invests primarily in senior secured loans of middle-market companies. We co-invest in these securities with GF Equity Funding through the Glick JV. The Glick JV is managed by a four person Board of Directors, two of whom are selected by us and two of whom are selected by GF Equity Funding. All portfolio decisions and investment decisions in respect of the Glick JV must be approved by the Glick JV investment committee, consisting of one representative selected by us and one representative selected by GF Equity Funding (with approval from a representative of each required). Since we do not have a controlling financial interest in the Glick JV, we do not consolidate the Glick JV. The Glick JV is not an "eligible portfolio company" as defined in section 2(a)(46) of the Investment Company Act. The Glick JV is capitalized as transactions are completed. The members provide capital to the Glick

Previous wording

The cost and fair value of our aggregate investment in the Glick JV was $52.0 million and $49.6 million, respectively, as of December 31, 2024. The cost and fair value of our aggregate investment in the Glick JV was $51.7 million and $48.9 million, respectively, as of September 30, 2024. For the three months ended December 31, 2024 and 2023, our investment in the Glick JV Notes earned interest income of $1.7 million and $1.8 million, respectively. We did not earn any dividend income for the three months ended December 31, 2024 and 2023 with respect to our investment in the LLC equity interests of the Glick JV.

Current wording

The cost and fair value of our aggregate investment in the Glick JV was $52.4 million and $47.3 million, respectively, as of March 31, 2025. The cost and fair value of our aggregate investment in the Glick JV was $51.7 million and $48.9 million, respectively, as of September 30, 2024. For the three and six months ended March 31, 2025, our investment in the Glick JV Notes earned interest income of $1.7 million and $3.4 million, respectively. For the three and six months ended March 31, 2024, our investment in the Glick JV Notes earned interest income of $1.8 million and $3.6 million, respectively. We did not earn any dividend income for the three and six months ended March 31, 2025 and 2024 with respect to our investment in the LLC equity interests of the Glick JV.

Previous wording

Comparison of Three Months ended December 31, 2024 and December 31, 2023

Current wording

Comparison of Three and Six Months ended March 31, 2025 and March 31, 2024

Previous wording

Total investment income for the three months ended December 31, 2024 and 2023 was $86.6 million and $98.0 million, respectively. For the three months ended December 31, 2024, this amount consisted of $84.2 million of interest income from portfolio investments (which included $5.7 million of PIK interest), $1.7 million of fee income and $0.8 million of dividend income. For the three months ended December 31, 2023, this amount consisted of $95.3 million of interest income from portfolio investments (which included $3.8 million of PIK interest), $1.3 million of fee income and $1.4 million of dividend income. The decrease of $11.3 million, or 11.6%, in our total investment income for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, was due primarily to an $11.1 million decrease in interest income, which resulted from decreases in reference rates, the impact of certain investments that were placed on non-accrual status and a smaller investment portfolio, and a $0.6 million decrease in dividend income primarily driven by our investment in SLF JV I. This was partially offset by $0.4 million of higher fee income driven by higher exit fees.

Current wording

Total investment income for the three months ended March 31, 2025 and 2024 was $77.6 million and $94.0 million, respectively. For the three months ended March 31, 2025, this amount consisted of $75.1 million of interest income from portfolio investments (which included $4.5 million of PIK interest), $1.7 million of fee income and $0.8 million of dividend income. For the three months ended March 31, 2024, this amount consisted of $90.1 million of interest income from portfolio investments (which included $4.8 million of PIK interest), $2.5 million of fee income and $1.4 million of dividend income. The decrease of $16.5 million, or 17.5%, in our total investment income for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, was due primarily to a $15.0 million decrease in interest income, which resulted from decreases in reference rates, the impact of certain investments that were placed on non-accrual status and a smaller investment portfolio, $0.8 million of lower fee income driven by lower amendment fees and a $0.6 million decrease in dividend income primarily driven by our investment in SLF JV I.

Previous wording

Net expenses (i.e., expenses net of fee waivers) for the three months ended December 31, 2024 and 2023 were $42.1 million and $53.8 million, respectively. Net expenses decreased for the three months ended December 31, 2024, as compared to the three months ended December 31, 2023, by $11.7 million, or 21.8%. The decrease in net expenses was primarily driven by a $7.5 million reduction in Part I incentive fees (net of waivers), $2.6 million of lower management fees (net of waivers) and $1.6 million of lower interest expense.

Current wording

Net expenses (i.e., expenses net of fee waivers) for the three months ended March 31, 2025 and 2024 were $38.2 million and $52.7 million, respectively. Net expenses decreased for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, by $14.4 million, or 27.4%. The decrease in net expenses was primarily driven by a $8.5 million reduction in Part I incentive fees (net of waivers) due to the implementation of a total return hurdle, $3.7 million of lower interest expense due to decrease in reference rates and a lower average borrowings outstanding and $2.8 million of lower management fees (net of waivers).

Previous wording

Net investment income for the three months ended December 31, 2024 increased by $0.1 million compared to the three months ended December 31, 2023, as a result of the $11.7 million decrease in net expenses, partially offset by a $11.3 million decrease in total investment income and a $0.3 million increase in the provision for taxes on net investment income.

Current wording

Net investment income for the three months ended March 31, 2025 decreased by $2.3 million compared to the three months ended March 31, 2024, as a result of the $16.5 million decrease in total investment income and a $0.3 million increase in the provision for taxes on net investment income, partially offset by a $14.4 million decrease in net expenses.

Previous wording

During the three months ended December 31, 2024 and 2023, we recorded aggregate net realized losses of $17.3 million and $8.5 million, respectively, in connection with the exits and restructurings of various investments and foreign currency forward contracts. See “Note 8. Realized Gains or Losses and Net Unrealized Appreciation or Depreciation” in the notes to the accompanying Consolidated Financial Statements for more details regarding investment realization events for the three months ended December 31, 2024 and 2023.

Current wording

During the three months ended March 31, 2025 and 2024, we recorded aggregate net realized gains (losses) of $6.7 million and $(6.6) million, respectively, in connection with the exits and restructurings of various investments and foreign currency forward contracts. During the six months ended March 31, 2025 and 2024, we recorded aggregate net realized losses of $10.6 million and $15.1 million, respectively, in connection with the exits and restructurings of various investments and foreign currency forward contracts. See “Note 8. Realized Gains or Losses and Net Unrealized Appreciation or Depreciation” in the notes to the accompanying Consolidated Financial Statements for more details regarding investment realization events for the three and six months ended March 31, 2025 and 2024.

Previous wording

During the three months ended December 31, 2024 and 2023, we recorded net unrealized depreciation of $19.6 million and $25.0 million, respectively. For the three months ended December 31, 2024, this consisted of $24.3 million of net unrealized depreciation on debt investments and $17.8 million of net unrealized depreciation on equity investments, partially offset by $10.5 million of net unrealized appreciation of foreign currency forward contracts and $12.0 million of net unrealized appreciation related to exited investments (a portion of which resulted in a reclassification to realized losses). For the three months ended December 31, 2023, this consisted of $18.8 million of net unrealized depreciation on equity investments, $13.7 million of net unrealized depreciation on debt investments and $7.8 million of net unrealized depreciation of foreign currency forward contracts, partially offset by $15.3 million of net unrealized appreciation related to exited investments (a portion of which resulted in a reclassification to realized losses).

Current wording

During the three months ended March 31, 2025 and 2024, we recorded net unrealized depreciation of $82.0 million and $25.3 million, respectively. For the three months ended March 31, 2025, this consisted of $63.0 million of net unrealized depreciation on debt investments, $10.0 million of net unrealized depreciation on equity investments and $14.7 million of net unrealized depreciation of foreign currency forward contracts, partially offset by $5.7 million of net unrealized appreciation related to exited investments (a portion of which resulted in a reclassification to realized losses). For the three months ended March 31, 2024, this consisted of $24.8 million of net unrealized depreciation on equity investments and $13.5 million of net unrealized depreciation on debt investments, partially offset by $10.9 million of net unrealized appreciation related to exited investments (a portion of which resulted in a reclassification to realized losses) and $2.2 million of net unrealized appreciation of foreign currency forward contracts.

Previous wording

Our primary uses of cash are for (1) investments in portfolio companies and other investments to comply with certain portfolio diversification requirements, (2) the cost of operations (including our expenses, the management and incentive fees and any indemnification obligations), (3) debt service of borrowings and (4) cash distributions to stockholders. We may also from time to time repurchase or redeem some or all of our outstanding notes. At a special meeting of our stockholders held on June 28, 2019, our stockholders approved the application of the reduced asset coverage requirements in Section 61(a)(2) of the Investment Company Act to us effective as of June 29, 2019. As a result of the reduced asset coverage requirement, we can incur $2 of debt for each $1 of equity as compared to $1 of debt for each $1 of equity. As of December 31, 2024, we had $1,612.9 million in senior securities and our asset coverage ratio was 187.89%. As of December 31, 2024, our target debt to equity ratio was 0.90x to 1.25x (i.e., one dollar of equity for each $0.90 to $1.25 of debt outstanding) and our net debt to equity ratio was 1.03x.

Current wording

Our primary uses of cash are for (1) investments in portfolio companies and other investments to comply with certain portfolio diversification requirements, (2) the cost of operations (including our expenses, the management and incentive fees and any indemnification obligations), (3) debt service of borrowings and (4) cash distributions to stockholders. We may also from time to time repurchase or redeem some or all of our outstanding notes. At a special meeting of our stockholders held on June 28, 2019, our stockholders approved the application of the reduced asset coverage requirements in Section 61(a)(2) of the Investment Company Act to us effective as of June 29, 2019. As a result of the reduced asset coverage requirement, we can incur $2 of debt for each $1 of equity as compared to $1 of debt for each $1 of equity. As of March 31, 2025, we had $1,478.1 million in senior securities and our asset coverage ratio was 198.34%. As of March 31, 2025, our target debt to equity ratio was 0.90x to 1.25x (i.e., one dollar of equity for each $0.90 to $1.25 of debt outstanding) and our net debt to equity ratio was 0.93x.

Previous wording

For the three months ended December 31, 2024, we experienced a net increase in cash and cash equivalents (including restricted cash) of $47.5 million. During that period, net cash provided by operating activities was $144.0 million, primarily from $352.5 million of principal payments and sale proceeds received and the cash activities related to $44.3 million of net investment income, partially offset by funding $201.8 million of investments, $53.8 million of net increases in receivables and net decreases in payables from unsettled transactions and a $4.8 million increase in due from broker. During the same period, net cash used in financing activities was $95.3 million, primarily consisting of $43.8 million of cash distributions paid to our stockholders and $50.0 million of net repayments under our credit facilities.

Current wording

For the six months ended March 31, 2025, we experienced a net increase in cash and cash equivalents (including restricted cash) of $29.7 million. During that period, net cash provided by operating activities was $206.0 million, primarily from $640.3 million of principal payments and sale proceeds received and the cash activities related to $83.4 million of net investment income, partially offset by funding $600.9 million of investments, $93.6 million of net increases in payables from unsettled transactions and a $8.1 million increase in due from broker. During the same period, net cash used in financing activities was $177.3 million, primarily consisting of $80.9 million of cash distributions paid to our stockholders, $190.0 million of net repayments under our credit facilities, partially offset by $103.0 million of proceeds from issuance of shares.

Previous wording

For the three months ended December 31, 2023, we experienced a net decrease in cash and cash equivalents (including restricted cash) of $13.8 million. During that period, net cash provided by operating activities was $1.1 million, primarily from $217.6 million of principal payments and sale proceeds received, the cash activities related to $44.2 million of net investment income, $77.8 million of net decreases in receivables and net increases in payables from unsettled transactions and a $27.7 million decrease in due from broker, partially offset by funding $359.9 million of investments. During the same period, net cash used by financing activities was $14.6 million, primarily consisting of $47.0 million of cash distributions paid to our stockholders, partially offset by $32.4 million of proceeds from the issuance of shares under the "at the market" offering.

Current wording

For the six months ended March 31, 2024, we experienced a net decrease in cash and cash equivalents (including restricted cash) of $8.0 million. During that period, net cash used in operating activities was $16.5 million, primarily from funding $733.5 million of investments, partially offset by $540.2 million of principal payments and sale proceeds received, the cash activities related to $85.6 million of net investment income, $85.1 million of net decreases in receivables and net increases in payables from unsettled transactions and a $13.6 million decrease in due from broker. During the same period, net cash provided by financing activities was $8.5 million, primarily consisting of $78.5 million of proceeds from the issuance of shares under the "at the market" offering and $20.0 million net borrowings under credit facilities, partially offset by $89.8 million of cash distributions paid to our stockholders.

Previous wording

As of December 31, 2024, we had $126.1 million in cash and cash equivalents (including $13.2 million of restricted cash), portfolio investments (at fair value) of $2.8 billion, $25.3 million of interest, dividends and fees receivable, $0.4 million of due from portfolio companies, $957.5 million of undrawn capacity on our credit facilities (subject to borrowing base and other limitations), $55.7 million of net receivables from unsettled transactions, $660.0 million of borrowings outstanding under our credit facilities and $917.8 million of unsecured notes payable (net of unamortized financing costs, unaccreted discount and interest rate swap fair value adjustment).

Current wording

As of March 31, 2025, we had $108.2 million in cash and cash equivalents (including $10.4 million of restricted cash), portfolio investments (at fair value) of $2.9 billion, $22.8 million of interest, dividends and fees receivable, $0.3 million of due from portfolio companies, $1,097.5 million of undrawn capacity on our credit facilities (subject to borrowing base and other limitations), $91.7 million of net payables from unsettled transactions, $520.0 million of borrowings outstanding under our credit facilities and $928.5 million of unsecured notes payable (net of unamortized financing costs, unaccreted discount and interest rate swap fair value adjustment).

Previous wording

We may be a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financial needs of our portfolio companies. As of December 31, 2024, our only off-balance sheet arrangements consisted of $302.3 million of unfunded commitments, which was composed of $275.2 million to provide debt and equity financing to certain of our portfolio companies and $27.1 million to provide financing to the JVs. Of the $275.2 million, approximately $243.7 million can be drawn immediately with the remaining amount subject to certain milestones that must be met by portfolio companies or other restrictions. As of September 30, 2024, our only off-balance sheet arrangements consisted of $311.4 million of unfunded commitments, which was comprised of $284.3 million to provide debt and equity financing to certain of our portfolio companies and $27.1 million to provide financing to the JVs. Of the $284.3 million, approximately $247.6 million can be drawn immediately with the remaining amount subject to certain milestones that must be met by portfolio companies or other restrictions.

Current wording

We may be a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financial needs of our portfolio companies. As of March 31, 2025, our only off-balance sheet arrangements consisted of $299.8 million of unfunded commitments, which was composed of $272.6 million to provide debt and equity financing to certain of our portfolio companies and $27.1 million to provide financing to the JVs. Of the $272.6 million, approximately $252.0 million can be drawn immediately with the remaining amount subject to certain milestones that must be met by portfolio companies or other restrictions. As of September 30, 2024, our only off-balance sheet arrangements consisted of $311.4 million of unfunded commitments, which was comprised of $284.3 million to provide debt and equity financing to certain of our portfolio companies and $27.1 million to provide financing to the JVs. Of the $284.3 million, approximately $247.6 million can be drawn immediately with the remaining amount subject to certain milestones that must be met by portfolio companies or other restrictions.

Previous wording

The following table reflects information pertaining to our principal debt outstanding under the Syndicated Facility, the OSI2 Citibank Facility, the 2025 Notes, the 2027 Notes and the 2029 Notes (each as defined below):

Current wording

The following table reflects information pertaining to our principal debt outstanding under the Syndicated Facility, the OSI2 Citibank Facility, the 2025 Notes, the 2027 Notes, the 2029 Notes and the 2030 Notes (each as defined below):

Previous wording

(a) The interest due on the 2027 Notes and the 2029 Notes was calculated net of the interest rate swaps.

Current wording

(a) The interest due on the 2027 Notes, the 2029 Notes and the 2030 Notes was calculated net of the interest rate swaps.

Previous wording

On January 23, 2023, in connection with the OSI2 Merger, we issued an aggregate of 15,860,200 shares of common stock to former OSI2 stockholders. During the three months ended December 31, 2023, we issued 98,605 shares of common stock as part of the dividend reinvestment plan, or DRIP.

Current wording

During the three and six months ended March 31, 2024, we issued 96,850 shares of common stock as part of the dividend reinvestment plan, or DRIP.

Previous wording

We are party to an equity distribution agreement, dated February 7, 2022, as amended, by and among us, the Adviser and Oaktree Administrator and Keefe, Bruyette & Woods, Inc., Citizens JMP Securities, LLC, Jefferies LLC and Raymond James & Associates, Inc., pursuant to which we may offer and sell shares of our common stock from time to time having an aggregate offering price of up to $300.0 million under our current shelf registration statement. Sales of the common stock, if any, may be made in negotiated transactions or transactions that are deemed to be “at the market,” as defined in Rule 415 under the Securities Act of 1933, as amended, including sales made directly on the Nasdaq Global Select Market or similar securities exchanges or sales made to or through a market maker other than on an exchange, at prices related to the prevailing market prices or at negotiated prices.

Current wording

We are party to an equity distribution agreement, dated February 7, 2022, as amended, by and among us, Oaktree and Oaktree Administrator and Keefe, Bruyette & Woods, Inc., Citizens JMP Securities, LLC and Raymond James & Associates, Inc., pursuant to which we may offer and sell shares of our common stock from time to time having an aggregate offering price of up to $300.0 million under our current shelf registration statement. Sales of the common stock, if any, may be made in negotiated transactions or transactions that are deemed to be “at the market,” as defined in Rule 415 under the Securities Act of 1933, as amended, including sales made directly on the Nasdaq Global Select Market or similar securities exchanges or sales made to or through a market maker other than on an exchange, at prices related to the prevailing market prices or at negotiated prices.

Previous wording

In connection with the "at the market" offering, we issued and sold 1,641,416 shares of common stock during the three months ended December 31, 2023 for net proceeds of $32.3 million (net of offering costs).

Current wording

In connection with the "at the market" offering, we issued and sold 168,055 shares of common stock during the six months ended March 31, 2025 for net proceeds of $3.0 million (net of offering costs).

Previous wording

(1) Net proceeds excludes offering costs of $0.1 million.

Current wording

(1) Net proceeds excludes offering costs of less than $0.1 million.

Previous wording

In connection with the "at the market" offering, we did not issue and sell any shares of common stock during the three months ended December 31, 2024.

Current wording

In connection with the "at the market" offering, we issued and sold 3,975,169 shares of common stock during the six months ended March 31, 2024 for net proceeds of $78.3 million (net of offering costs).

Previous wording

On January 31, 2025, we and Oaktree Capital I, L.P., an affiliate of the Adviser, entered into a purchase agreement pursuant to which Oaktree Capital I, L.P. purchased 5,672,149 shares of our common stock on February 3, 2025 for an aggregate purchase price of $100.0 million. These shares were sold at $17.63 per share, which was the Company’s net asset value per share as of January 31, 2025 as calculated in accordance with Section 23 of the Investment Company Act. The shares were sold in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration. Oaktree Capital I, L.P. has agreed not to sell the shares acquired in this transaction through February 3, 2026.

Current wording

On January 31, 2025, the Company and Oaktree Capital I, L.P., an affiliate of Oaktree, entered into a purchase agreement pursuant to which Oaktree Capital I, L.P. purchased 5,672,149 shares of our common stock on February 3, 2025 for an aggregate purchase price of $100.0 million. These shares were sold at $17.63 per share, which was our net asset value per share

Previous wording

Bank, N.A. as joint lead arrangers and joint bookrunners, and JPMorgan Chase Bank, N.A. and Bank of America, N.A., as syndication agents, was $1.218 billion (with an “accordion” feature that permits us, under certain circumstances, to increase the size of the facility to up to the greater of $1.25 billion and our net worth (as defined in the Syndicated Facility) on the date of such increase), (ii) the period during which we may make drawings on $1.035 billion of commitments will expire on June 23, 2027 and the maturity date was June 23, 2028, (iii) the period during which we may make drawings with respect to the remaining commitments will expire on May 4, 2025 and the maturity date is May 4, 2026 and (iv) the interest rate margin for (a) SOFR loans (which may be 1- or 3-month, at our option) was 2.00% plus a SOFR adjustment which ranges between 0.11448% and 0.26161% and (b) alternate base rate loans was 1.00%.

Current wording

As of March 31, 2025, (i) the size of the our senior secured revolving credit facility, or, as amended and/or restated from time to time, the Syndicated Facility, pursuant to a senior secured revolving credit agreement, with the lenders, ING Capital LLC, as administrative agent, ING Capital LLC, JPMorgan Chase Bank, N.A., BofA Securities, Inc. and MUFG Union Bank, N.A. as joint lead arrangers and joint bookrunners, and JPMorgan Chase Bank, N.A. and Bank of America, N.A., as syndication agents, was $1.218 billion (with an “accordion” feature that permits us, under certain circumstances, to increase the size of the facility to up to the greater of $1.25 billion and our net worth (as defined in the Syndicated Facility) on the date of such increase), (ii) the period during which we may make drawings on $1.035 billion of commitments will expire on June 23, 2027 and the maturity date was June 23, 2028, (iii) the period during which we may make drawings with respect to the remaining commitments will expire on May 4, 2025 and the maturity date is May 4, 2026 and (iv) the interest rate margin for (a) SOFR loans (which may be 1- or 3-month, at our option) was 2.00% plus a SOFR adjustment which ranges between 0.11448% and 0.26161% and (b) alternate base rate loans was 1.00%.

Previous wording

As of each of December 31, 2024 and September 30, 2024, we had $430.0 million of borrowings outstanding under the Syndicated Facility, which had a fair value of $430.0 million. Our borrowings under the Syndicated Facility bore interest at a weighted average interest rate of 6.841% and 7.621% for the three months ended December 31, 2024 and 2023, respectively. For the three months ended December 31, 2024 and 2023, we recorded interest expense (inclusive of fees) of $9.5 million and $9.6 million, respectively, related to the Syndicated Facility.

Current wording

As of each of March 31, 2025 and September 30, 2024, we had $430.0 million of borrowings outstanding under the Syndicated Facility, which had a fair value of $430.0 million. Our borrowings under the Syndicated Facility bore interest at a weighted average interest rate of 6.651% and 7.579% for the six months ended March 31, 2025 and 2024, respectively. For the three and six months ended March 31, 2025, we recorded interest expense (inclusive of fees) of $8.4 million and $17.8 million, respectively, related to the Syndicated Facility. For the three and six months ended March 31, 2024, we recorded interest expense (inclusive of fees) of $9.6 million and $19.1 million, respectively, related to the Syndicated Facility.

Previous wording

As of each of December 31, 2024 and September 30, 2024, we had $230.0 million and $280.0 million outstanding under the OSI2 Citibank Facility, respectively, which had a fair value of $230.0 million and $280.0 million, respectively. Our borrowings under the OSI2 Citibank Facility bore interest at a weighted average interest rate of 7.412% and 8.204% for the three months ended December 31, 2024 and 2023, respectively. For the three months ended December 31, 2024 and 2023, we recorded interest expense (inclusive of fees) of $5.7 million and $6.1 million, respectively, related to the OSI2 Citibank Facility.

Current wording

As of each of March 31, 2025 and September 30, 2024, we had $90.0 million and $280.0 million outstanding under the OSI2 Citibank Facility, respectively, which had a fair value of $90.0 million and $280.0 million, respectively. Our borrowings under the OSI2 Citibank Facility bore interest at a weighted average interest rate of 6.876% and 8.079% for the six months ended March 31, 2025 and 2024, respectively. For the three and six months ended March 31, 2025, we recorded interest expense (inclusive of fees) of $4.2 million and $9.9 million, respectively, related to the OSI2 Citibank Facility. For the three and six months ended March 31, 2024, we recorded interest expense (inclusive of fees) of $6.0 million and $12.1 million, respectively, related to the OSI2 Citibank Facility.

Previous wording

On February 25, 2020, we issued $300.0 million in aggregate principal amount of the 2025 Notes for net proceeds of $293.8 million after deducting OID of $2.5 million, underwriting commissions and discounts of $3.0 million and offering costs of $0.7 million. The OID on the 2025 Notes is amortized based on the effective interest method over the term of the notes.

Current wording

On February 25, 2020, we issued $300.0 million in aggregate principal amount of the 2025 Notes for net proceeds of $293.8 million after deducting OID of $2.5 million, underwriting commissions and discounts of $3.0 million and offering costs of $0.7 million. The OID on the 2025 Notes was amortized based on the effective interest method over the term of the notes. The 2025 Notes matured on February 25, 2025.

Previous wording

In connection with the 2029 Notes, we entered into an interest rate swap to more closely align the interest rates of its liabilities with its investment portfolio, which consists of predominately floating rate loans. Under the interest rate swap agreement, we receive a fixed interest rate of 7.100% and pays a floating interest rate of the three-month SOFR plus 3.1255% on a notional amount of $300.0 million. We designated the interest rate swap as the hedging instrument in an effective hedge accounting relationship.

Current wording

In connection with the 2029 Notes, we entered into an interest rate swap to more closely align the interest rates of our liabilities with our investment portfolio, which consists of predominately floating rate loans. Under the interest rate swap agreement, we receive a fixed interest rate of 7.100% and pay a floating interest rate of the three-month SOFR plus 3.1255% on a notional amount of $300.0 million. We designated the interest rate swap as the hedging instrument in an effective hedge accounting relationship.

Previous wording

The below table presents the components of the carrying value of the 2025 Notes, the 2027 Notes and the 2029 Notes as of December 31, 2024 and September 30, 2024:

Current wording

The below table presents the components of the carrying value of the 2025 Notes, the 2027 Notes, the 2029 Notes and the 2030 Notes as of March 31, 2025 and September 30, 2024:

Previous wording

The below table presents the components of interest and other debt expenses related to the 2025 Notes, the 2027 Notes and the 2029 Notes for the three months ended December 31, 2023:

Current wording

The below table presents the components of interest and other debt expenses related to the 2025 Notes, the 2027 Notes, the 2029 Notes and the 2030 Notes for the three and six months ended March 31, 2025:

Previous wording

The below table presents the components of interest and other debt expenses related to the 2025 Notes, the 2027 Notes and the 2029 Notes for the three months ended December 31, 2024:

Current wording

The below table presents the components of interest and other debt expenses related to the 2025 Notes, the 2027 Notes and the 2029 Notes for the three and six months ended March 31, 2024:

Previous wording

We have entered into the Investment Advisory Agreement with Oaktree and the Administration Agreement with Oaktree Administrator, an affiliate of Oaktree. Mr. John B. Frank, an interested member of our Board of Directors, has an indirect pecuniary interest in Oaktree. Oaktree is a registered investment adviser under the Investment Advisers Act of 1940, as amended, that is partially and indirectly owned by Oaktree Capital Group, LLC. See “Note 10. Related Party Transactions – Investment Advisory Agreement” and “– Administrative Services” in the notes to the accompanying Consolidated Financial Statements.

Current wording

We have entered into the Investment Advisory Agreement with Oaktree and the Administration Agreement with Oaktree Administrator, an affiliate of Oaktree. Mr. John B. Frank, an interested member of our Board of Directors, has an indirect pecuniary interest in Oaktree. Oaktree is a registered investment adviser under the Investment Advisers Act of 1940, as amended, that is partially and indirectly owned by Brookfield Oaktree Holdings, LLC. See “Note 10. Related Party Transactions – Investment Advisory Agreement” and “– Administrative Services” in the notes to the accompanying Consolidated Financial Statements.

Previous wording

On January 27, 2025, our Board of Directors declared quarterly and supplemental distributions of $0.40 per share and $0.07 per share, respectively, payable in cash on March 31, 2025 to stockholders of record on March 17, 2025.

Current wording

On April 28, 2025, our Board of Directors declared quarterly and supplemental distributions of $0.40 per share and $0.02 per share, respectively, payable in cash on June 30, 2025 to stockholders of record on June 16, 2025.