UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q

ý       QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2020

OR

o         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____         

Commission File No. 814-00663 
ARES CAPITAL CORPORATION
(Exact name of Registrant as specified in its charter) 
Maryland
 
33-1089684
(State or other jurisdiction of
 
(I.R.S. Employer
incorporation or organization)
 
Identification Number)

245 Park Avenue, 44th Floor, New York, NY 10167
(Address of principal executive office)   (Zip Code)
(212) 750-7300
(Registrant’s telephone number, including area code)
____________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading symbol
Name of each exchange on which registered
Common stock, $0.001 par value
ARCC
NASDAQ Global Select Market
6.875% Senior Notes due 2047
AFC
The New York Stock Exchange

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

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one): 
Large accelerated filer x
 
Accelerated filer o
Non-accelerated filer o
 
Smaller reporting company o
 
 
Emerging growth company o

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

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

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Class
 
Outstanding at April 29, 2020
Common stock, $0.001 par value
 
422,622,119





ARES CAPITAL CORPORATION
 
INDEX
 
Part I.
Financial Information
 
 
 
 
 
 
 
 
 
3
 
 
 
 
4
 
 
 
 
5
 
 
 
 
87
 
 
 
 
88
 
 
 
 
89
 
 
 
123
 
 
 
148
 
 
 
150
 
 
 
 
 
 
 
150
 
 
 
150
 
 
 
152
 
 
 
152
 
 
 
153
 
 
 
153
 
 
 
153



PART I - FINANCIAL INFORMATION
Item 1. Financial Statements

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(in millions, except per share data)


 
As of
 
March 31, 2020

December 31, 2019

(unaudited)

 
ASSETS
 

 
Investments at fair value
 


 

Non-controlled/non-affiliate company investments
$
12,275


$
12,198

Non-controlled affiliate company investments
305


296

Controlled affiliate company investments
1,790


1,932

Total investments at fair value (amortized cost of $15,491 and $14,696, respectively)
14,370


14,426

Cash and cash equivalents
460


167

Restricted cash
655

 
9

Interest receivable
111


117

Other assets
93

 
78

Operating lease right-of-use asset
94

 
94

Receivable for open trades
23


14

Total assets
$
15,806


$
14,905

LIABILITIES
 



Debt
$
8,179


$
6,971

Payable to participants
655

 
9

Base management fees payable
55

 
54

Income based fees payable
44

 
48

Capital gains incentive fees payable

 
58

Interest and facility fees payable
38

 
54

Accounts payable and other liabilities
122

 
90

Payable for open trades
11

 
33

Operating lease liabilities
119

 
121

Total liabilities
9,223


7,438

Commitments and contingencies (Note 7)





STOCKHOLDERS’ EQUITY





Common stock, par value $0.001 per share, 600 common shares authorized; 423 and 431 common shares issued and outstanding, respectively



Capital in excess of par value
7,660


7,760

Accumulated overdistributed earnings
(1,077
)

(293
)
Total stockholders’ equity
6,583


7,467

Total liabilities and stockholders’ equity
$
15,806


$
14,905

NET ASSETS PER SHARE
$
15.58


$
17.32


See accompanying notes to consolidated financial statements.


3

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(in millions, except per share data)
(unaudited)



 
For the Three Months Ended March 31,
 
2020
 
2019
INVESTMENT INCOME:
 
 
 
From non-controlled/non-affiliate company investments:
 
 
 
Interest income from investments (excluding payment-in-kind (“PIK”) interest income)
$
235

 
$
233

PIK interest income from investments
19

 
12

Capital structuring service fees
27

 
39

Dividend income
18

 
15

Other income
6

 
8

Total investment income from non-controlled/non-affiliate company investments
305

 
307

From non-controlled affiliate company investments:
 
 
 
Interest income from investments (excluding PIK interest income)
3

 
5

PIK interest income from investments
1

 
1

Capital structuring service fees
1

 
2

Dividend income

 
1

Total investment income from non-controlled affiliate company investments
5

 
9

From controlled affiliate company investments:
 
 
 
Interest income from investments (excluding PIK interest income)
37

 
33

PIK interest income from investments
3

 
5

Capital structuring service fees

 
4

Dividend income
18

 
15

Other income
1

 

Total investment income from controlled affiliate company investments
59

 
57

Total investment income
369

 
373

EXPENSES:
 
 
 
Interest and credit facility fees
82

 
67

Base management fees
55

 
49

Income based fees
44

 
48

Capital gains incentive fees
(58
)
 
2

Administrative fees
4

 
4

Other general and administrative
5

 
8

Total expenses
132

 
178

Waiver of income based fees

 
(10
)
Total expenses, net of waiver of income based fees
132

 
168

NET INVESTMENT INCOME BEFORE INCOME TAXES
237

 
205

Income tax expense, including excise tax
3

 
4

NET INVESTMENT INCOME
234

 
201

REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS, FOREIGN CURRENCY AND OTHER TRANSACTIONS:
 
 
 
Net realized gains (losses):
 
 
 
Non-controlled/non-affiliate company investments
46

 
7

Non-controlled affiliate company investments
(7
)
 

Controlled affiliate company investments
(4
)
 

Foreign currency and other transactions
(1
)
 
49

Net realized gains
34

 
56

Net unrealized gains (losses):
 
 
 
Non-controlled/non-affiliate company investments
(740
)
 
(33
)
Non-controlled affiliate company investments
(18
)
 
(7
)
Controlled affiliate company investments
(131
)
 
1

Foreign currency and other transactions
9

 
(4
)
Net unrealized losses
(880
)
 
(43
)
Net realized and unrealized gains (losses) on investments, foreign currency and other transactions
(846
)
 
13

NET INCREASE (DECREASE) IN STOCKHOLDERS’ EQUITY RESULTING FROM OPERATIONS
$
(612
)
 
$
214

BASIC AND DILUTED NET INCOME (LOSS) PER COMMON SHARE (see Note 10)
$
(1.42
)
 
$
0.50

WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING (see Note 10)
430

 
426


See accompanying notes to consolidated financial statements.


4

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2020
(dollar amounts in millions)
(unaudited)


Company(1)
 
Business Description
 
Investment
 
Interest(3)(7)
 
Acquisition
Date
 
Amortized
Cost
 
Fair
Value
 
Percentage
of Net
Assets
Health Care Services
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
42 North Dental, LLC (fka Gentle Communications, LLC) (16)
 
Dental services provider
 
First lien senior secured revolving loan ($1.5 par due 5/2022)
 
8.50% (Base Rate + 5.25%/Q)
 
5/26/2017
 
$
1.5

 
$
1.4

(2)(12)
 
 
Absolute Dental Management LLC and ADM Equity, LLC
 
Dental services provider
 
First lien senior secured loan ($0.8 par due 1/2022)
 
8.50% (Libor + 7.50%/Q)
 
1/15/2019
 
0.8

 
0.8

(2)(11)
 
 
 
 
 
 
First lien senior secured loan ($24.6 par due 1/2022)
 
 
 
1/5/2016
 
24.2

 
11.5

(2)(12)
 
 
 
 
 
 
Class A preferred units (4,000,000 units)
 
 
 
1/5/2016
 
4.0

 

(2)
 
 
 
 
 
 
Class A common units (4,000,000 units)
 
 
 
1/5/2016
 

 

(2)
 
 
 
 
 
 
 
 
 
 
 
 
29.0

 
12.3

 
 
 
Acessa Health Inc. (fka HALT Medical, Inc.)
 
Medical supply provider
 
Common stock (569,823 shares)
 
 
 
6/22/2017
 
0.1

 

 
 
 
ADCS Billings Intermediate Holdings, LLC (16)
 
Dermatology practice
 
First lien senior secured revolving loan ($5.0 par due 5/2022)
 
6.79% (Libor + 5.75%/Q)
 
5/18/2016
 
5.0

 
4.8

(2)(12)
 
 
ADG, LLC and RC IV GEDC Investor LLC (16)
 
Dental services provider
 
First lien senior secured revolving loan ($13.7 par due 9/2022)
 
6.82% (Libor + 3.00% Cash, 2.75% PIK/Q)
 
9/28/2016
 
13.7

 
11.8

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($94.9 par due 3/2024)
 
 
 
9/28/2016
 
89.0

 
66.4

(2)(11)
 
 
 
 
 
 
Membership units (3,000,000 units)
 
 
 
9/28/2016
 
3.0

 

(2)
 
 
 
 
 
 
 
 
 
 
 
 
105.7

 
78.2

 
 
 
Air Medical Group Holdings, Inc. and Air Medical Buyer Corp.
 
Emergency air medical services provider
 
Senior subordinated loan ($182.7 par due 3/2026)
 
9.49% (Libor + 7.88%/Q)
 
3/14/2018
 
182.7

 
177.2

(2)(12)
 
 
 
 
 
 
Warrant to purchase up to 115,733 units of common stock (expires 3/2028)
 
 
 
3/14/2018
 
0.9

 
1.2

(2)
 
 
 
 
 
 
 
 
 
 
 
 
183.6

 
178.4

 
 
 
Alteon Health, LLC
 
Provider of physician management services
 
First lien senior secured loan ($3.0 par due 9/2022)
 
7.95% (Libor + 6.50%/Q)
 
5/15/2017
 
3.0

 
2.6

(2)(12)
 
 
Athenahealth, Inc., VVC Holding Corp., Virence Intermediate Holding Corp., and Virence Holdings LLC (16)
 
Revenue cycle management provider to the physician practices and acute care hospitals
 
First lien senior secured loan ($7.0 par due 2/2026)
 
5.28% (Libor + 4.50%/Q)
 
2/11/2019
 
6.8

 
6.6

(2)
 
 
 
 
 
 
Second lien senior secured loan ($210.3 par due 2/2027)
 
9.50% (Libor + 8.50%/Q)
 
2/11/2019
 
210.3

 
204.0

(2)
 
 
 
 
 
 
Senior preferred stock (121,810 shares)
 
12.05% PIK (Libor + 11.13%/M)
 
2/11/2019
 
136.9

 
136.9

(2)
 
 
 
 
 
 
Class A interests (0.39% interest)
 
 
 
2/11/2019
 
9.0

 
14.2

(2)
 
 
 
 
 
 
 
 
 
 
 
 
363.0

 
361.7

 
 
 
Bearcat Buyer, Inc. and Bearcat Parent, Inc. (16)
 
Provider of central institutional review boards over clinical trials
 
First lien senior secured revolving loan ($0.4 par due 7/2024)
 
5.25% (Libor + 4.25%/M)
 
7/9/2019
 
0.4

 
0.4

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($30.8 par due 7/2026)
 
5.70% (Libor + 4.25%/Q)
 
7/9/2019
 
30.8

 
29.9

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($2.0 par due 7/2026)
 
5.70% (Libor + 4.25%/Q)
 
7/9/2019
 
2.0

 
2.0

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($17.1 par due 7/2026)
 
5.70% (Libor + 4.25%/Q)
 
9/10/2019
 
17.1

 
16.6

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($64.2 par due 7/2027)
 
9.70% (Libor + 8.25%/Q)
 
7/9/2019
 
64.2

 
62.9

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($5.3 par due 7/2027)
 
9.70% (Libor + 8.25%/Q)
 
7/9/2019
 
5.3

 
5.2

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($12.7 par due 7/2027)
 
9.70% (Libor + 8.25%/Q)
 
9/10/2019
 
12.7

 
12.4

(2)(12)
 
 
 
 
 
 
Class B common units (4,211 units)
 
 
 
7/9/2019
 
4.2

 
5.3

(2)
 
 
 
 
 
 
 
 
 
 
 
 
136.7

 
134.7

 
 
 

5

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2020
(dollar amounts in millions)
(unaudited)

Company(1)
 
Business Description
 
Investment
 
Interest(3)(7)
 
Acquisition
Date
 
Amortized
Cost
 
Fair
Value
 
Percentage
of Net
Assets
CCS-CMGC Holdings, Inc. (16)
 
Correctional facility healthcare operator
 
First lien senior secured revolving loan ($7.5 par due 10/2023)
 
7.50% (Base Rate + 4.25%/M)
 
10/1/2018
 
7.5

 
7.0

(2)(15)
 
 
 
 
 
 
First lien senior secured revolving loan ($0.9 par due 10/2023)
 
6.24% (Libor + 5.25%/M)
 
10/1/2018
 
0.9

 
0.9

(2)(15)
 
 
 
 
 
 
First lien senior secured loan ($34.6 par due 10/2025)
 
6.84% (Libor + 5.50%/Q)
 
9/25/2018
 
34.3

 
32.1

(2)
 
 
 
 
 
 
 
 
 
 
 
 
42.7

 
40.0

 
 
 
Center for Autism and Related Disorders, LLC (16)
 
Autism treatment and services provider specializing in applied behavior analysis therapy
 
First lien senior secured revolving loan ($7.8 par due 11/2023)
 
5.40% (Libor + 4.00%/Q)
 
11/21/2018
 
7.8

 
7.0

(2)(15)
 
 
Comprehensive EyeCare Partners, LLC (16)
 
Vision care practice management company
 
First lien senior secured revolving loan ($1.8 par due 2/2024)
 
5.75% (Libor + 4.50%/Q)
 
2/14/2018
 
1.8

 
1.6

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($5.3 par due 2/2024)
 
5.95% (Libor + 4.50%/Q)
 
2/14/2018
 
5.3

 
5.0

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($1.0 par due 2/2024)
 
6.75% (Base Rate + 3.50%/Q)
 
2/14/2018
 
1.0

 
1.0

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($2.4 par due 2/2024)
 
5.95% (Libor + 4.50%/Q)
 
2/14/2018
 
2.4

 
2.2

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
10.5

 
9.8

 
 
 
Convey Health Solutions, Inc.
 
Workforce management solutions provider
 
First lien senior secured loan ($20.1 par due 9/2026)
 
7.01% (Libor + 5.25%/Q)
 
9/4/2019
 
20.1

 
19.5

(2)(12)
 
 
CVP Holdco, Inc. and OMERS Wildcats Holdings Inc. (16)
 
Veterinary hospital operator
 
First lien senior secured revolving loan ($0.7 par due 10/2024)
 
6.87% (Libor + 5.75%/M)
 
10/31/2019
 
0.7

 
0.7

(2)(12)(15)
 
 
 
 
 
 
First lien senior secured loan ($66.1 par due 10/2025)
 
7.34% (Libor + 5.75%/Q)
 
10/31/2019
 
66.1

 
62.1

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($14.1 par due 10/2025)
 
7.34% (Libor + 5.75%/Q)
 
10/31/2019
 
14.1

 
13.3

(2)(12)
 
 
 
 
 
 
Common stock (31,005 shares)
 
 
 
10/31/2019
 
9.6

 
9.7

(2)
 
 
 
 
 
 
 
 
 
 
 
 
90.5

 
85.8

 
 
 
D4C Dental Brands HoldCo, Inc. and Bambino Group Holdings, LLC (16)
 
Dental services provider
 
First lien senior secured revolving loan ($4.8 par due 12/2022)
 
9.50% (Base Rate + 6.25%/Q)
 
12/21/2016
 
4.8

 
4.6

(2)(12)(15)
 
 
 
 
 
 
Class A preferred units (1,000,000 units)
 
 
 
12/21/2016
 
1.0

 
1.0

(2)
 
 
 
 
 
 
 
 
 
 
 
 
5.8

 
5.6

 
 
 
DCA Investment Holding, LLC (16)
 
Multi-branded dental practice management
 
First lien senior secured revolving loan ($5.7 par due 7/2021)
 
6.25% (Libor + 5.25%/M)
 
7/2/2015
 
5.7

 
5.4

(2)(12)(15)
 
 
 
 
 
 
First lien senior secured loan ($18.3 par due 7/2021)
 
6.32% (Libor + 5.25%/Q)
 
7/2/2015
 
18.2

 
17.5

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
23.9

 
22.9

 
 
 
Emerus Holdings, Inc.
 
Freestanding 24-hour emergency care micro-hospitals operator
 
First lien senior secured loan ($16.5 par due 2/2022)
 
14.00%
 
2/21/2019
 
16.5

 
16.5

(2)
 
 
Evolent Health LLC and Evolent Health, Inc. (16)
 
Medical technology company focused on value based care services and payment solutions
 
First lien senior secured loan ($67.1 par due 12/2024)
 
9.45% (Libor + 8.00%/Q)
 
12/30/2019
 
61.2

 
61.1

(2)(6)(12)
 
 
 
 
 
 
Warrant to purchase up to 1,354,968 shares of common stock (expires 1/2025)
 
 
 
12/30/2019
 
5.9

 
5.9

(2)(6)
 
 
 
 
 
 
 
 
 
 
 
 
67.1

 
67.0

 
 
 
GHX Ultimate Parent Corporation, Commerce Parent, Inc. and Commerce Topco, LLC
 
On-demand supply chain automation solutions provider to the healthcare industry
 
Second lien senior secured loan ($34.5 par due 6/2025)
 
9.37% (Libor + 8.00%/Q)
 
6/30/2017
 
34.2

 
33.2

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($55.0 par due 6/2025)
 
9.37% (Libor + 8.00%/Q)
 
1/13/2020
 
55.0

 
52.8

(2)(12)
 
 
 
 
 
 
Series A preferred stock (110,425 shares)
 
12.20% PIK (Libor + 10.75%/Q)
 
6/30/2017
 
157.2

 
150.9

(2)(12)
 
 

6

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2020
(dollar amounts in millions)
(unaudited)

Company(1)
 
Business Description
 
Investment
 
Interest(3)(7)
 
Acquisition
Date
 
Amortized
Cost
 
Fair
Value
 
Percentage
of Net
Assets
 
 
 
 
Class A units (14,013,303 units)
 
 
 
6/30/2017
 
14.0

 
16.9

(2)
 
 
 
 
 
 
 
 
 
 
 
 
260.4

 
253.8

 
 
 
Hygiena Borrower LLC (16)
 
Adenosine triphosphate testing technology provider
 
Second lien senior secured loan ($2.5 par due 8/2023)
 
9.20% (Libor + 7.75%/Q)
 
8/26/2016
 
2.5

 
2.4

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($10.7 par due 8/2023)
 
9.20% (Libor + 7.75%/Q)
 
2/27/2017
 
10.7

 
10.2

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($11.1 par due 8/2023)
 
9.20% (Libor + 7.75%/Q)
 
6/29/2018
 
11.1

 
10.7

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($0.6 par due 8/2023)
 
9.20% (Libor + 7.75%/Q)
 
6/29/2018
 
0.6

 
0.6

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
24.9

 
23.9

 
 
 
JDC Healthcare Management, LLC (16)
 
Dental services provider
 
First lien senior secured revolving loan ($4.0 par due 4/2022)
 
8.75% (Libor + 7.75%/M)
 
4/10/2017
 
4.0

 
3.2

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($29.6 par due 4/2023)
 
8.75% (Libor + 6.75% Cash, 1.00% PIK/M)
 
4/10/2017
 
29.6

 
23.7

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($4.2 par due 4/2023)
 
8.75% (Libor + 6.75% Cash, 1.00% PIK/M)
 
4/10/2017
 
4.2

 
3.3

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
37.8

 
30.2

 
 
 
KBHS Acquisition, LLC (d/b/a Alita Care, LLC) (16)
 
Provider of behavioral health services
 
First lien senior secured revolving loan ($4.5 par due 3/2022)
 
6.00% (Libor + 5.00%/M)
 
3/17/2017
 
4.5

 
4.1

(2)(12)
 
 
Key Surgical LLC (16)
 
Provider of sterile processing, operating room and instrument care supplies for hospitals
 
First lien senior secured revolving loan ($1.1 par due 6/2022)
 
5.75% (Libor + 4.75%/Q)
 
6/1/2017
 
1.1

 
1.0

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($16.1 par due 6/2023)
 
6.00% (EURIBOR + 5.00%/Q)
 
6/1/2017
 
16.4

 
15.7

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($5.4 par due 6/2023)
 
6.00% (Libor + 5.00%/M)
 
8/28/2019
 
5.4

 
5.2

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
22.9

 
21.9

 
 
 
MB2 Dental Solutions, LLC (16)
 
Dental services provider
 
First lien senior secured revolving loan ($4.6 par due 9/2023)
 
7.25% (Base Rate + 4.00%/Q)
 
9/29/2017
 
4.6

 
4.3

(2)(12)
 
 
MCH Holdings, Inc. and MC Acquisition Holdings I, LLC
 
Healthcare professional provider
 
First lien senior secured loan ($0.8 par due 7/2020)
 
7.75% (Base Rate + 4.50%/M)
 
7/26/2017
 
0.8

 
0.8

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($115.2 par due 7/2020)
 
7.00% (Libor + 5.50%/M)
 
7/26/2017
 
115.2

 
114.0

(2)(12)
 
 
 
 
 
 
Class A units (1,438,643 shares)
 
 
 
1/17/2014
 
1.5

 
1.2

(2)
 
 
 
 
 
 
 
 
 
 
 
 
117.5

 
116.0

 
 
 
Minerva Surgical, Inc. (16)
 
Medical device company focused on women's health
 
First lien senior secured loan ($30.1 par due 12/2022)
 
11.50% (Libor + 9.50%/Q)
 
12/30/2019
 
29.0

 
28.9

(2)(12)
 
 
MW Dental Holding Corp. (16)
 
Dental services provider
 
First lien senior secured revolving loan ($10.2 par due 4/2021)
 
8.25% (Libor + 6.75%/Q)
 
4/12/2011
 
10.2

 
9.9

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($125.4 par due 4/2021)
 
8.25% (Libor + 6.75%/Q)
 
4/12/2011
 
125.4

 
121.6

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($24.4 par due 4/2021)
 
8.25% (Libor + 6.75%/Q)
 
3/19/2018
 
24.4

 
23.6

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
160.0

 
155.1

 
 
 
NMN Holdings III Corp. and NMN Holdings LP (16)
 
Provider of complex rehab technology solutions for patients with mobility loss
 
First lien senior secured revolving loan ($8.8 par due 11/2023)
 
4.42% (Libor + 3.50%/M)
 
11/13/2018
 
8.8

 
8.3

(2)(15)
 
 
 
 
 
 
Partnership units (30,000 units)
 
 
 
11/13/2018
 
3.0

 
3.1

(2)
 
 
 
 
 
 
 
 
 
 
 
 
11.8

 
11.4

 
 
 
NMSC Holdings, Inc. and ASP NAPA Holdings, LLC
 
Anesthesia management services provider
 
Second lien senior secured loan ($72.8 par due 10/2023)
 
11.62% (Libor + 10.00%/B)
 
4/19/2016
 
72.8

 
68.4

(2)(12)
 
 

7

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2020
(dollar amounts in millions)
(unaudited)

Company(1)
 
Business Description
 
Investment
 
Interest(3)(7)
 
Acquisition
Date
 
Amortized
Cost
 
Fair
Value
 
Percentage
of Net
Assets
 
 
 
 
Class A units (25,790 units)
 
 
 
4/19/2016
 
2.6

 
0.7

(2)
 
 
 
 
 
 
 
 
 
 
 
 
75.4

 
69.1

 
 
 
NueHealth Performance, LLC (16)
 
Developer, builder and manager of specialty surgical hospitals and ambulatory surgery centers
 
First lien senior secured loan ($9.9 par due 9/2023)
 
7.50% (Libor + 6.50%/M)
 
9/27/2018
 
9.9

 
9.6

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($1.5 par due 9/2023)
 
8.10% (Libor + 6.50%/M)
 
9/27/2018
 
1.5

 
1.4

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
11.4

 
11.0

 
 
 
Olympia Acquisition, Inc. and Olympia TopCo, L.P. (16)
 
Behavioral health and special education platform provider
 
First lien senior secured revolving loan ($10.1 par due 9/2024)
 
6.50% (Libor + 5.50%/Q)
 
9/24/2019
 
10.1

 
9.4

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($42.9 par due 9/2026)
 
6.50% (Libor + 5.50%/M)
 
9/24/2019
 
42.9

 
39.9

(2)(12)
 
 
 
 
 
 
Class A common units (9,549,000 units)
 
 
 
9/24/2019
 
9.5

 
7.4

(2)
 
 
 
 
 
 
 
 
 
 
 
 
62.5

 
56.7

 
 
 
OMH-HealthEdge Holdings, LLC (16)
 
Revenue cycle management software provider for healthcare companies
 
First lien senior secured loan ($26.6 par due 10/2025)
 
6.50% (Libor + 5.50%/M)
 
10/24/2019
 
26.6

 
25.8

(2)(12)
 
 
OSYS Holdings, LLC
 
Provider of technology-enabled solutions to pharmacies
 
Limited liability company membership interest (1.57%)
 
 
 
11/21/2013
 
1.0

 
0.6

(2)
 
 
Pathway Vet Alliance LLC and Jedi Group Holdings LLC (16)
 
Veterinary hospital operator
 
First lien senior secured loan ($10.9 par due 3/2027)
 
4.24% (Libor + 3.25%/M)
 
3/31/2020
 
10.9

 
10.3

(2)
 
 
 
 
 
 
Second lien senior secured loan ($76.3 par due 3/2028)
 
8.75% (Libor + 7.75%/M)
 
3/31/2020
 
76.3

 
73.5

(2)(12)
 
 
 
 
 
 
Class R common units (6,004,768 units)
 
 
 
3/31/2020
 
6.0

 
6.0

(2)
 
 
 
 
 
 
 
 
 
 
 
 
93.2

 
89.8

 
 
 
Patterson Medical Supply, Inc.
 
Distributor of rehabilitation supplies and equipment
 
Second lien senior secured loan ($78.0 par due 8/2023)
 
10.28% (Libor + 8.50%/Q)
 
9/2/2015
 
77.1

 
60.1

(2)(12)
 
 
PetIQ, LLC
 
Distributor and manufacturer of pet prescription medications and health products
 
First lien senior secured revolving loan ($21.0 par due 7/2025)
 
5.50% (Libor + 4.50%/M)
 
1/17/2018
 
21.0

 
20.3

(2)(6)
 
 
PetVet Care Centers, LLC
 
Veterinary hospital operator
 
First lien senior secured loan ($26.2 par due 2/2025)
 
5.25% (Libor + 4.25%/M)
 
10/31/2019
 
25.8

 
24.5

(2)(12)
 
 
PhyMED Management LLC
 
Provider of anesthesia services
 
Second lien senior secured loan ($47.2 par due 5/2021)
 
9.83% (Libor + 8.75%/Q)
 
12/18/2015
 
47.1

 
46.3

(2)(12)
 
 
Premise Health Holding Corp. and OMERS Bluejay Investment Holdings LP (16)
 
Provider of employer-sponsored onsite health and wellness clinics and pharmacies
 
First lien senior secured revolving loan ($34.4 par due 7/2023)
 
4.12% (Libor + 3.25%/B)
 
7/10/2018
 
34.4

 
32.7

(2)(15)
 
 
 
 
 
 
First lien senior secured loan ($10.8 par due 7/2025)
 
4.95% (Libor + 3.50%/Q)
 
7/10/2018
 
10.8

 
10.3

(2)
 
 
 
 
 
 
Second lien senior secured loan ($67.1 par due 7/2026)
 
8.95% (Libor + 7.50%/Q)
 
7/10/2018
 
66.6

 
64.4

(2)
 
 
 
 
 
 
Class A units (9,775 units)
 
 
 
7/10/2018
 
9.8

 
10.6

(2)
 
 
 
 
 
 
 
 
 
 
 
 
121.6

 
118.0

 
 
 
ProVation Medical, Inc.
 
Provider of documentation and coding software for GI physicians
 
First lien senior secured loan ($12.9 par due 3/2024)
 
8.85% (Libor + 7.00%/Q)
 
3/9/2018
 
12.7

 
12.7

(2)
 
 
Respicardia, Inc.
 
Developer of implantable therapies to improve cardiovascular health
 
Warrant to purchase up to 99,094 shares of Series C preferred stock (expires 6/2022)
 
 
 
6/28/2012
 

 

(2)
 
 
RTI Surgical, Inc.
 
Manufacturer of biologic, metal and synthetic implants/devices
 
Second lien senior secured loan ($96.1 par due 12/2023)
 
9.75% (Libor + 4.375% Cash, 4.375% PIK/Q)
 
3/8/2019
 
96.1

 
96.1

(2)(6)(12)
 
 
SCSG EA Acquisition Company, Inc. (16)
 
Provider of outsourced clinical services to hospitals and health systems
 
First lien senior secured revolving loan ($0.9 par due 9/2022)
 
5.00% (Libor + 4.00%/M)
 
9/1/2017
 
0.9

 
0.9

(2)(12)(15)
 
 
SiroMed Physician Services, Inc. and SiroMed Equity Holdings, LLC (16)
 
Outsourced anesthesia provider
 
First lien senior secured loan ($17.1 par due 3/2024)
 
6.20% (Libor + 4.75%/Q)
 
3/26/2018
 
17.1

 
16.5

(2)(12)
 
 
 
 
 
 
Common units (684,854 units)
 
 
 
3/26/2018
 
4.9

 
3.0

(2)
 
 
 
 
 
 
 
 
 
 
 
 
22.0

 
19.5

 
 
 

8

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2020
(dollar amounts in millions)
(unaudited)

Company(1)
 
Business Description
 
Investment
 
Interest(3)(7)
 
Acquisition
Date
 
Amortized
Cost
 
Fair
Value
 
Percentage
of Net
Assets
SM Wellness Holdings, Inc. and SM Holdco, Inc. (16)
 
Breast cancer screening provider
 
First lien senior secured revolving loan ($5.5 par due 8/2024)
 
5.95% (Libor + 4.50%/Q)
 
8/1/2018
 
5.5

 
5.3

(2)
 
 
 
 
 
 
First lien senior secured loan ($7.0 par due 8/2024)
 
6.95% (Libor + 5.50%/Q)
 
8/1/2018
 
7.0

 
6.8

(2)
 
 
 
 
 
 
Series A preferred stock (44,975 shares)
 
11.70% PIK (Libor + 10.25%/Q)
 
8/1/2018
 
55.5

 
55.5

(2)
 
 
 
 
 
 
Series A units (7,475 units)
 
 
 
8/1/2018
 
7.5

 
0.1

(2)
 
 
 
 
 
 
Series B units (747,500 units)
 
 
 
8/1/2018
 

 
6.1

(2)
 
 
 
 
 
 
 
 
 
 
 
 
75.5

 
73.8

 
 
 
Synergy HomeCare Franchising, LLC and NP/Synergy Holdings, LLC (16)
 
Franchisor of private-pay home care for the elderly
 
First lien senior secured revolving loan ($2.5 par due 4/2024)
 
6.75% (Libor + 5.75%/M)
 
4/2/2018
 
2.5

 
2.5

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($15.8 par due 4/2024)
 
7.20% (Libor + 5.75%/Q)
 
4/2/2018
 
15.8

 
15.8

(2)(12)
 
 
 
 
 
 
Common units (550 units)
 
 
 
4/2/2018
 
0.6

 
0.8

 
 
 
 
 
 
 
 
 
 
 
 
 
18.9

 
19.1

 
 
 
Teligent, Inc.
 
Pharmaceutical company that develops, manufactures and markets injectable pharmaceutical products
 
Second lien senior secured loan ($52.3 par due 6/2024)
 
9.75% (Libor + 7.75% Cash, 1.00% PIK/Q)
 
12/13/2018
 
52.3

 
48.1

(2)(12)
 
 
 
 
 
 
Second lien senior secured loan ($29.8 par due 6/2024)
 
10.06% (Libor + 7.75% Cash, 1.00% PIK/Q)
 
12/13/2018
 
29.8

 
27.5

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
82.1

 
75.6

 
 
 
Touchstone Acquisition, Inc. and Touchstone Holding, L.P. (16)
 
Manufacturer of consumable products in the dental, medical, cosmetic and CPG/industrial end-markets
 
First lien senior secured loan ($25.4 par due 11/2025)
 
5.82% (Libor + 4.75%/Q)
 
11/15/2018
 
25.4

 
24.6

(2)
 
 
 
 
 
 
Class A preferred units (2,149 units)
 
8.00% PIK
 
11/15/2018
 
2.4

 
1.9

(2)
 
 
 
 
 
 
 
 
 
 
 
 
27.8

 
26.5

 
 
 
U.S. Acute Care Solutions, LLC (16)
 
Provider of physician management services
 
First lien senior secured revolving loan ($0.9 par due 11/2020)
 
6.00% (Libor + 5.00%/M)
 
2/8/2018
 
0.9

 
0.9

(2)
 
 
U.S. Anesthesia Partners, Inc.
 
Anesthesiology service provider
 
Second lien senior secured loan ($71.8 par due 6/2025)
 
8.85% (Libor + 7.25%/M)
 
6/16/2017
 
71.1

 
68.9

(2)(12)
 
 
United Digestive MSO Parent, LLC (16)
 
Gastroenterology physician group
 
First lien senior secured revolving loan ($8.4 par due 12/2023)
 
5.50% (Libor + 4.50%/Q)
 
12/14/2018
 
8.4

 
8.4

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($12.4 par due 12/2024)
 
6.28% (Libor + 4.50%/Q)
 
12/14/2018
 
12.4

 
12.4

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
20.8

 
20.8

 
 
 
Urgent Cares of America Holdings I, LLC and FastMed Holdings I, LLC
 
Operator of urgent care clinics
 
Preferred units (7,696,613 units)
 
 
 
6/11/2015
 
7.7

 

 
 
 
 
 
 
 
Series A common units (2,000,000 units)
 
 
 
6/11/2015
 
2.0

 

 
 
 
 
 
 
 
Series C common units (5,288,427 units)
 
 
 
6/11/2015
 

 

 
 
 
 
 
 
 
 
 
 
 
 
 
9.7

 

 
 
 
Urology Management Associates, LLC and JWC/UMA Holdings, L.P.
 
Urology private practice
 
First lien senior secured loan ($9.7 par due 8/2024)
 
6.00% (Libor + 5.00%/M)
 
8/31/2018
 
9.6

 
9.4

(2)(12)
 
 
 
 
 
 
Limited partnership interests (3.64% interest)
 
 
 
8/31/2018
 
4.8

 
4.2

(2)
 
 
 
 
 
 
 
 
 
 
 
 
14.4

 
13.6

 
 
 
WSHP FC Acquisition LLC (16)
 
Provider of biospecimen products for pharma research
 
First lien senior secured revolving loan ($3.5 par due 3/2024)
 
7.70% (Libor + 6.25%/Q)
 
3/30/2018
 
3.5

 
3.5

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($28.1 par due 3/2024)
 
7.70% (Libor + 6.25%/Q)
 
3/30/2018
 
28.1

 
27.8

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($5.9 par due 3/2024)
 
7.70% (Libor + 6.25%/Q)
 
3/30/2018
 
5.9

 
5.9

(2)(12)
 
 

9

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2020
(dollar amounts in millions)
(unaudited)

Company(1)
 
Business Description
 
Investment
 
Interest(3)(7)
 
Acquisition
Date
 
Amortized
Cost
 
Fair
Value
 
Percentage
of Net
Assets
 
 
 
 
First lien senior secured loan ($4.6 par due 3/2024)
 
7.70% (Libor + 6.25%/Q)
 
2/11/2019
 
4.6

 
4.6

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($5.8 par due 3/2024)
 
7.70% (Libor + 6.25%/Q)
 
2/11/2019
 
5.8

 
5.8

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($8.7 par due 3/2024)
 
7.70% (Libor + 6.25%/Q)
 
8/30/2019
 
8.7

 
8.6

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($11.0 par due 3/2024)
 
7.70% (Libor + 6.25%/Q)
 
10/31/2019
 
11.0

 
10.9

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
67.6

 
67.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2,869.1

 
2,715.5

 
41.24%
 
Software & Services
 
 
 
 
 
 
 
 
 

 

 
 
 
AffiniPay Midco, LLC and AffiniPay Intermediate Holdings, LLC (16)
 
Payment processing solution provider
 
First lien senior secured revolving loan ($1.8 par due 3/2026)
 
6.75% (Libor + 5.50%/Q)
 
2/28/2020
 
1.8

 
1.7

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($65.0 par due 3/2026)
 
6.95% (Libor + 5.50%/Q)
 
2/28/2020
 
65.0

 
62.4

(2)(12)
 
 
 
 
 
 
Senior subordinated loan ($22.0 par due 2/2028)
 
12.75% PIK
 
2/28/2020
 
22.0

 
20.9

(2)
 
 
 
 
 
 
 
 
 
 
 
 
88.8

 
85.0

 
 
 
Anaqua Parent Holdings, Inc. & Astorg VII Co-Invest Anaqua (16)
 
Provider of IP management lifecycle software
 
First lien senior secured loan ($4.6 par due 4/2026)
 
5.50% (Euribor + 5.50%/Q)
 
4/10/2019
 
4.7

 
4.6

(2)
 
 
 
 
 
 
First lien senior secured loan ($7.7 par due 4/2026)
 
7.07% (Libor + 5.25%/Q)
 
4/10/2019
 
7.7

 
7.7

(2)(12)
 
 
 
 
 
 
Limited partnership units (4,400,000 units)
 
 
 
6/13/2019
 
5.0

 
5.9

(2)(6)
 
 
 
 
 
 
 
 
 
 
 
 
17.4

 
18.2

 
 
 
APG Intermediate Holdings Corporation and APG Holdings, LLC (4)(16)
 
Aircraft performance software provider
 
First lien senior secured loan ($12.9 par due 1/2025)
 
6.75% (Libor + 5.25%/Q)
 
1/3/2020
 
12.9

 
12.6

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($0.5 par due 1/2025)
 
6.75% (Libor + 5.25%/Q)
 
1/3/2020
 
0.5

 
0.5

(2)(12)
 
 
 
 
 
 
Class A Membership units (9,750,000 units)
 
 
 
1/3/2020
 
9.8

 
9.0

(2)
 
 
 
 
 
 
 
 
 
 
 
 
23.2

 
22.1

 
 
 
Apptio, Inc. (16)
 
Provider of cloud-based technology business management solutions
 
First lien senior secured loan ($62.2 par due 1/2025)
 
8.25% (Libor + 7.25%/M)
 
1/10/2019
 
62.2

 
60.9

(2)(12)
 
 
Avetta, LLC (16)
 
Supply chain risk management SaaS platform for global enterprise clients
 
First lien senior secured loan ($36.0 par due 4/2024)
 
6.82% (Libor + 5.75%/Q)
 
4/10/2018
 
36.0

 
34.9

(2)(12)
 
 
Blue Campaigns Intermediate Holding Corp. and Elevate Parent, Inc. (dba EveryAction) (16)
 
Provider of fundraising and organizing efforts and digital services to non-profits and political campaigns
 
First lien senior secured revolving loan ($2.3 par due 8/2023)
 
10.00% (Base Rate + 6.75%/M)
 
8/20/2018
 
2.3

 
2.2

(2)(12)
 
 
 
 
 
 
First lien senior secured loan ($40.8 par due 8/2023)
 
8.45% (Libor + 6.75%/Q)
 
8/20/2018
 
40.8

 
40.0

(2)(12)
 
 
 
 
 
 
Series A preferred stock (150,000 shares)
 
 
 
9/26/2018
 
1.5

 
1.7

 
 
 
 
 
 
 
 
 
 
 
 
 
44.6

 
43.9

 
 
 
CallMiner, Inc.
 
Provider of cloud-based conversational analytics solutions
 
Warrant to purchase up to 2,350,636 shares of Series 1 preferred stock (expires 7/2024)
 
 
 
7/23/2014
 

 

(2)
 
 
Clearwater Analytics, LLC (16)
 
Provider of integrated cloud-based investment portfolio management, accounting, reporting and analytics software
 
First lien senior secured loan ($3.9 par due 12/2025)
 
7.41% (Libor + 5.50%/Q)
 
12/3/2019
 
3.9

 
3.9

(2)(12)
 
 
Command Alkon Incorporated (16)
 
Software solutions provider to the ready-mix concrete industry
 
First lien senior secured revolving loan
 
 
 
9/1/2017
 

 

(14)
 
 
 
 
 
 
First lien senior secured loan ($20.2 par due 9/2023)
 
7.58% (Libor + 5.00% Cash, 1.00% PIK/M)
 
9/1/2017
 
20.2

 
20.2

(2)(12)
 
 

10

ARES CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED SCHEDULE OF INVESTMENTS
As of March 31, 2020
(dollar amounts in millions)
(unaudited)

Company(1)
 
Business Description
 
Investment
 
Interest(3)(7)
 
Acquisition
Date
 
Amortized
Cost
 
Fair
Value
 
Percentage
of Net
Assets
 
 
 
 
Second lien senior secured loan ($34.0 par due 3/2024)
 
11.58% (Libor + 9.00% Cash, 1.00% PIK/M)
 
9/1/2017
 
34.0

 
34.0

(2)(12)
 
 
 
 
 
 
 
 
 
 
 
 
54.2

 
54.2

 
 
 
Compuware Software Group LLC
 
Web and mobile cloud performance testing and monitoring services provider
 
Preferred units (4,132 units)
 
9.00% PIK
 
7/31/2019
 
0.8

 
1.9

(2)
 
 
 
 
 
 
Common units (744,569 units)
 
 
 
7/31/2019
 

 
0.8

(2)