XML 26 R15.htm IDEA: XBRL DOCUMENT v3.24.1.1.u2
DEBT OBLIGATIONS AND CREDIT FACILITIES
 3 Months Ended
Mar. 31, 2024
Debt Disclosure [Abstract]  
DEBT OBLIGATIONS AND CREDIT FACILITIES DEBT OBLIGATIONS AND CREDIT FACILITIES
Oaktree Capital I Debt Obligations
On March 30, 2022, Oaktree Capital I entered into a note and guaranty agreement with certain accredited investors pursuant to which Oaktree Capital I agreed to issue and sell to such investors €50 million of its 2.20% Senior Notes, Series A, due 2032, €75 million of its 2.40% Senior Notes, Series B, due 2034, and €75 million of its 2.58% Senior Notes, Series C, due 2037. These notes are senior unsecured obligations of Oaktree Capital I, a consolidated subsidiary of the Company, and jointly and severally guaranteed by OCM, Oaktree Capital II and Oaktree AIF. The offering closed on June 8, 2022, and Oaktree Capital I received proceeds of €200 million on the closing date.
As of
March 31, 2024December 31, 2023
Senior unsecured notes
€50,000, 2.20%, issued in June 2022, payable on June 8, 2032
$54,566 $55,233 
€75,000, 2.40%, issued in June 2022, payable on June 8, 2034
81,847 82,849 
€75,000, 2.58%, issued in June 2022, payable on June 8, 2037
81,847 82,849 
Total remaining principal218,260 220,931 
Less: Debt issuance costs(1,220)(1,249)
Total debt obligations, net$217,040 $219,682 
Oaktree Capital I Guaranty Agreements
As of March 31, 2024, OCM, Oaktree Capital I, Oaktree Capital II, Oaktree AIF and OCM Cayman are co-obligors and jointly and severally liable for all debt obligations listed below, while the debt obligations are reflected in the condensed consolidated financial statements based upon the entity that actually made the borrowing and received the related proceeds. Prior to 2022, OCM had historically been the only direct borrower or issuer under credit agreements and private placement notes with third parties and made all payments of principal and interest. The Company’s financial statements after the 2019 Restructuring generally do not reflect debt obligations, interest expense or related liabilities associated with OCM, Oaktree Capital II and Oaktree AIF. Subsequent to the 2022 Restructuring, the Company’s financial statements no longer reflect debt obligations, interest expense or related liabilities associated with OCM, OCM Cayman, Oaktree Capital II and Oaktree AIF.
On April 7, 2023, OCM, Oaktree Capital I, Oaktree Capital II, Oaktree AIF and OCM Cayman (collectively, the “Obligors”) entered into amendments to each of the note and guaranty agreements listed below for each series of outstanding senior notes issued by OCM and Oaktree Capital I. Pursuant to these amendments, OCM Cayman became a guarantor of each such series of senior notes. These amendments also amended certain provisions in these note and guaranty agreements, including financial definitions, in order to facilitate the joinder of OCM Cayman as an obligor. Additionally, the amendments for the note purchase agreements executed in 2014 and 2020 amended the assets under management covenants to clarify the treatment of entities that the Obligors account for using equity method accounting. On the same date that the note and guaranty agreement amendments took effect, OCM Cayman became a Borrower under the $650 million revolving credit facility with OCM, Oaktree Capital I, Oaktree Capital II and Oaktree AIF pursuant to a joinder agreement executed by OCM Cayman as part of the Seventh Amendment to the credit facility.
On May 20, 2020, OCM entered into a note and guaranty agreement with certain accredited investors pursuant to which OCM agreed to issue and sell to such investors $250 million of senior unsecured notes that bear a blended 3.68% fixed rate of interest and a weighted average maturity of 2031. These notes are guaranteed by Oaktree Capital I, a consolidated subsidiary of the Company, along with Oaktree Capital II, Oaktree AIF and OCM Cayman, as co-obligors. The offering closed on July 22, 2020 and OCM received proceeds of $250 million on the closing date. As OCM is the issuer of such senior notes, the outstanding principal and interest payments guaranteed by Oaktree Capital I will not be included in the Company’s financial statements unless an event of default occurs.
Oaktree Capital I, along with certain other Oaktree Operating Group members as co-borrowers, are parties to a credit agreement with a subsidiary of Brookfield that provides for a subordinated credit facility. The subordinated credit facility has a revolving loan commitment of $250 million and borrowings generally bear interest at a spread to
either LIBOR or an alternative base rate. Borrowings on the subordinated credit facility are subordinate to the outstanding debt obligations and borrowings on the primary credit facility of Oaktree Capital I and its co-borrowers. Oaktree Capital I is jointly and severally liable, along with its co-obligors for outstanding borrowings on the subordinated credit facility. The Company’s financial statements generally will not reflect debt obligations, interest expense or related liabilities associated with the subordinated credit facility until such time as Oaktree Capital I directly borrows from it. In March 2022, this credit facility was amended to extend the revolving credit maturity date from May 19, 2023 to September 14, 2026. On October 6, 2023, an amendment was signed to further extend the maturity date to October 6, 2028 and change the interest rate to the SOFR plus 1.6% or an alternative base rate plus 0.5%. The amendment also provided that the maturity date will automatically extend annually in one-year increments until the lenders notify the borrowers of their intention to terminate the subordinated credit facility. No amounts were outstanding on the subordinated credit facility as of March 31, 2024.
On November 4, 2021, OCM entered into a note and guaranty agreement with certain accredited investors pursuant to which OCM agreed to issue and sell to such investors $200 million aggregate principal amount of its 3.06% Senior Notes due January 12, 2037. These notes are guaranteed by Oaktree Capital I, a consolidated subsidiary of the Company, along with Oaktree Capital II and Oaktree AIF, as co-obligors. The offering closed on January 12, 2022 and OCM received proceeds of $200 million on the closing date. As OCM is the issuer of such notes, the outstanding principal and interest payments guaranteed by Oaktree Capital I will not be included in the Company’s financial statements unless an event of default occurs.
Oaktree’s bank credit facility was amended on September 14, 2021 to among other things, (i) extend the maturity date from December 13, 2024 to September 14, 2026, (ii) modify the assets under management covenant threshold from $65 billion of assets under management to $57.5 billion of management-fee generating assets under management and (iii) increase the maximum leverage ratio to 4.00 to 1.00. Oaktree’s credit facility was further amended on December 15, 2022 to among other things, extend the maturity date from September 14, 2026 to December 15, 2027 with the potential to extend the maturity for up to two additional years, and implemented language consistent with U.S. syndicated loan market practice to use an adjusted forward-looking term rate based on the SOFR, as a replacement for the London Interbank Offered Rate. Based on the current credit ratings of OCM, the interest rate on borrowings is the term SOFR reference rate plus 1.10% per annum and the commitment fee on the unused portions of the revolving credit facility is 0.10% per annum. The term SOFR reference rate is determined by the tenor of the borrowings and set by the CME Group Benchmark Administration Limited (CBA). The credit agreement contains customary financial covenants and restrictions, including ones regarding a maximum leverage ratio and a minimum required level of assets under management (as defined in the credit agreement, as amended above). As of March 31, 2024, no amounts were outstanding under the revolving credit facility.
The fair value of the Company’s debt obligations, which are carried at amortized cost, is a Level III valuation that is estimated based on a discounted cash-flow calculation using estimated rates that would be offered to Oaktree for debt of similar terms and maturities. The fair value of these debt obligations, gross of debt issuance costs, was $171.9 million and $175.9 million as of March 31, 2024 and December 31, 2023, respectively, utilizing average borrowing rates of 5.0% and 4.9%, respectively.
OCM and the Company were in compliance with all financial maintenance covenants associated with its senior notes and bank credit facility as of March 31, 2024 and December 31, 2023, respectively. As of March 31, 2024, Oaktree Capital I is jointly and severally liable, along with its co-obligors, for the debt obligations listed below with an aggregate outstanding principal balance of $1.1 billion. The Company’s maximum exposure to these debt obligations is set forth below:
As of
 March 31, 2024December 31, 2023
Senior unsecured notes
$50,000, 3.91%, issued in September 2014, payable on September 3, 2024
$50,000 50,000 
$100,000, 4.01%, issued in September 2014, payable on September 3, 2026
100,000 100,000 
$100,000, 4.21%, issued in September 2014, payable on September 3, 2029
100,000 100,000 
$100,000, 3.69%, issued in July 2016, payable on July 12, 2031
100,000 100,000 
$250,000, 3.78%, issued in December 2017, payable on December 18, 2032
250,000 250,000 
$200,000, 3.64%, issued in July 2020, payable on July 22, 2030
200,000 200,000 
$50,000, 3.84%, issued in July 2020, payable on July 22, 2035
50,000 50,000 
$200,000, 3.06%, issued in January 2022, payable on January 12, 2037
200,000 200,000 
Total remaining principal$1,050,000 $1,050,000 
Debt Obligations of the Consolidated Funds
Certain consolidated funds may maintain revolving credit facilities that are secured by the assets of the fund or may issue senior variable rate notes to fund investments on a longer term basis, generally up to ten years. The obligations of the consolidated funds are nonrecourse to the Company.
The consolidated funds had the following debt obligations outstanding:
Outstanding Amount as of
Key terms as of March 31, 2024
Credit AgreementMarch 31, 2024December 31, 2023Facility CapacityEffective Interest RateWeighted Average Remaining Maturity (years)Commitment Fee RateL/C Fee
Revolving credit facilities (1)
$1,056,293 $951,950 $1,678,970 7.59%1.20.25%2.20%
Total debt obligations $1,056,293 $951,950 
Less: Debt issuance costs (2)
(6,925)(6,155)
Total debt obligations, net$1,049,368 $945,795 
(1)    The credit facility capacity is calculated on a pro rata basis using fund commitments as of March 31, 2024.
(2)    Debt issuance costs are included in other assets as of March 31, 2024 and December 31, 2023.
The carrying value of the revolving credit facilities approximated fair value due to recent issuance. Financial instruments that are valued using quoted prices for the security or similar securities are generally classified as Level III because the quoted prices may be indicative in nature for securities that are in an inactive market, may be for similar securities, or may require adjustment for investment-specific factors or restrictions.
Debt Obligations of CLOs
Debt obligations of CLOs represent amounts due to holders of debt securities issued by the CLOs, as well as term loans of CLOs that had not priced as of period end. Outstanding debt obligations of CLOs were as follows:
As of March 31, 2024As of December 31, 2023
Fair Value (1)
Weighted Average Interest RateWeighted Average Remaining Maturity (years)
Fair Value (1)
Weighted Average Interest RateWeighted Average Remaining Maturity (years)
Senior secured notes 381,666 7.3212.9— —%—
Total CLO debt obligations$381,666 $— 
(1)    The fair value of CLO liabilities was measured as the fair value of CLO assets less the sum of (a) the fair value of any beneficial interests held by the Company and (b) the carrying value of any beneficial interests that represent compensation for services. The fair value of the beneficial interests was calculated using a discounted cash flow model specific to each investment structure. Please see note 2 for more information.

The following table set forth the significant valuation inputs, including the input range and weighted average rate utilized in determining the fair value of the Company’s CLO beneficial interests held at March 31, 2024:
Valuation InputLowHighWeighted Average Rate
Discount rates16.0%37.0%22.6%
Constant default rates2.0%2.0%2.0%
Recovery rates60.0%65.0%62.8%

The debt obligations of CLOs are nonrecourse to the Company and are backed by the investments held by the respective CLO. Assets of one CLO may not be used to satisfy the liabilities of another. As of March 31, 2024 and December 31, 2023, the fair value of CLO assets was $0.6 billion and zero, respectively, and consisted of cash, corporate loans, corporate bonds and other securities.
As of March 31, 2024, future scheduled principal or par value payments with respect to the debt obligations of CLOs were as follows:
Remainder of 2024
$— 
2025— 
202611,872 
2027— 
2028— 
Thereafter370,000 
Total$381,872