N-2/A

As filed with the Securities and Exchange Commission on November 2, 2015

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 _________________________________________________

1933 Act File No. 333-205463

FORM N-2

PRE-EFFECTIVE AMENDMENT NO. 2

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

_________________________________________________

AMERICAN CAPITAL SENIOR FLOATING, LTD.

(Exact name of registrant as specified in charter)

2 BETHESDA METRO CENTER

14TH FLOOR

BETHESDA, MD 20814

(Address of principal executive offices)

Registrant’s telephone number, including area code: 301-968-9310

SAMUEL A. FLAX, ESQ.

EXECUTIVE VICE PRESIDENT,

CHIEF COMPLIANCE OFFICER AND SECRETARY

2 BETHESDA METRO CENTER

14TH FLOOR

BETHESDA, MD 20814

(Name and address of agent for service)

 _________________________________________________

COPIES TO:

RICHARD E. BALTZ, ESQ.

DARREN C. SKINNER, ESQ.

Arnold & Porter LLP

555 Twelfth Street, N.W.

Washington, DC 20004-1206

(202) 942-5000

  _________________________________________________

APPROXIMATE DATE OF PROPOSED PUBLIC OFFERING:

From time to time after the effective date of this registration statement.

x Check box if any securities being registered on this form will be offered on a delayed or continuous basis in reliance on Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”), other than securities offered in connection with a dividend reinvestment plan.

It is proposed that this filing will become effective (check appropriate box)

x when declared effective pursuant to section 8(c)

¨     immediately upon filing pursuant to paragraph (b)

¨ on (date) pursuant to paragraph (b)

¨ 60 days after filing pursuant to paragraph (a)

¨ on (date) pursuant to paragraph (a)

The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act, or until this registration statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), shall determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED NOVEMBER 2, 2015

PRELIMINARY PROSPECTUS

American Capital Senior Floating, Ltd.

$250,000,000

COMMON STOCK

PREFERRED STOCK

SUBSCRIPTION RIGHTS

DEBT SECURITIES

We may offer, from time to time, up to $250,000,000 aggregate initial offering price of our common stock, $0.01 par value per share, preferred stock, $0.01 par value per share, subscription rights and one or more classes or series of debt securities (collectively, the “Securities”) in one or more offerings. The Securities may be offered separately or together, in amounts, at prices and on terms to be disclosed in one or more supplements to this prospectus. The preferred stock and debt securities may also be convertible or exchangeable into shares of our common stock. The Securities may be offered directly to one or more purchasers, including existing stockholders in a rights offering, by us or through agents designated from time to time by us, or to or through underwriters or dealers. In the case of our common stock, the offering price per share by us less any underwriting commissions or discounts will not be less than the net asset value (“NAV”) per share of our common stock at the time we make the offering, except that we may issue shares of our common stock pursuant to this prospectus and the accompanying prospectus supplement at a price per share that is less than our NAV per share (a) in connection with a rights offering to our existing stockholders, (b) with the prior approval of the majority of our common stockholders or (c) under such circumstances as the U.S. Securities and Exchange Commission (“SEC”) may permit. In the event that we do issue shares of common stock with an offering price per share below our NAV per share, the interests of our existing stockholders may be diluted. You should read this prospectus and the applicable prospectus supplement carefully before you invest in our Securities. Our common stock is traded on The NASDAQ Global Select Market under the symbol “ACSF.” As of October 30, 2015, the last reported sales price for our common stock was $10.97 per share.

On January 22, 2014 we completed our initial public offering (“IPO”) and became an externally managed, non-diversified closed-end management investment company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act of 1933, as amended (the “Securities Act”). In addition, for tax purposes we intend to elect to be treated as a regulated investment company (“RIC”), as defined in Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). We are externally managed by American Capital ACSF Management, LLC (our “Manager”), an indirect subsidiary of American Capital Asset Management, LLC (“ACAM”), which is a wholly-owned portfolio company of American Capital, Ltd. (NASDAQ: ACAS) (“American Capital”), a publicly traded private equity firm and global asset manager with $81 billion in assets under management (including levered assets) as of June 30, 2015. American Capital and the parent company of our Manager provide to our Manager the administrative services necessary for us to operate.

Our investment objective is to provide attractive, risk-adjusted returns over the long term primarily through current income while seeking to preserve our capital. We actively manage a leveraged portfolio composed primarily of diversified investments in first lien and second lien floating rate loans principally to large-market U.S.-based companies (collectively, “Senior Secured Floating Rate Loans” or “Loans”) which are commonly referred to as leveraged loans. Standard and Poor’s (“S&P”), an independent international financial data and investment services company and provider of global equity indexes, defines large-market loans as loans to issuers with earnings before interest, taxes, depreciation and amortization (“EBITDA”) of greater than $50 million. We also invest in equity tranches of collateralized loan obligations (“CLOs”) which are securitized vehicles collateralized primarily by Loans and we may invest in debt tranches of CLOs. In addition, we may selectively invest in loans issued by middle market companies, mezzanine and unitranche loans and high yield bonds. Additionally, we may from time to time hold or invest in other equity investments and other debt or equity securities generally arising from a restructuring of Loan positions previously held by us. We utilize leverage to enhance our returns and we are limited under the 1940 Act as a BDC on the amount of leverage we can utilize.

This prospectus contains information you should know before investing, including information about risks associated with an investment in us. Please read it before you invest and keep it for future reference. Additional information about us, including our Annual Reports, Quarterly Reports, Current Reports, Proxy Statements and our Statement of Additional Information (“SAI”), dated as of the same date as this prospectus, has been filed with the SEC. You may obtain a copy of any of these documents by writing us at our principal office, which is located at 2 Bethesda Metro Center, 14th Floor, Bethesda, MD 20814, Attention: Investor Relations or by calling 301-968-9310. This information is also available at our web site www.ACSF.com. We will not charge you for these documents. The SEC maintains a web site at www.sec.gov that contains the SAI and other information regarding us. The SAI is incorporated by reference in its entirety into this prospectus and its table of contents appears on page SAI-1 of this prospectus. 

An investment in our Securities is very risky and highly speculative. In addition, the companies in which we invest are subject to special risks. We describe some of these risks in the section entitled “Risk Factors,” which begins on page 9. You should carefully consider these risks

together with all of the other information contained in this prospectus and any prospectus supplement before making a decision to purchase our Securities.

     The Securities being offered have not been approved or disapproved by the SEC or any state securities commission nor has the SEC or any state securities commission passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. This prospectus may not be used to consummate sales of the Securities by us through agents, underwriters or dealers unless accompanied by a prospectus supplement and/or pricing supplement.

The date of this prospectus is , 2015.

TABLE OF CONTENTS

PROSPECTUS SUMMARY	1
ADDITIONAL INFORMATION	7
SELECTED CONDENSED CONSOLIDATED FINANCIAL DATA	8
RISK FACTORS	9
USE OF PROCEEDS	26
PRICE RANGE OF COMMON STOCK AND DISTRIBUTIONS	26
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	28
RECENT DEVELOPMENTS	43
BUSINESS	43
PORTFOLIO COMPANIES	59
SENIOR SECURITIES	67
MANAGEMENT	67
OUR MANAGER, AMERICAN CAPITAL AND THE MANAGEMENT AGREEMENT	76
DETERMINATION OF NET ASSET VALUE	82
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN	83
DESCRIPTION OF CAPITAL STOCK	85
DESCRIPTION OF SUBSCRIPTION RIGHTS	87
DESCRIPTION OF DEBT SECURITIES	88
CERTAIN PROVISIONS OF THE MARYLAND GENERAL CORPORATION LAW AND OUR CHARTER AND BYLAWS	96
REGULATION	100
PLAN OF DISTRIBUTION	106
LEGAL MATTERS	107
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM	107
TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION	SAI-1
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS	F-1

PROSPECTUS SUMMARY

The following summary contains basic information about this offering. It likely does not contain all the information that is important to an investor. For a more complete understanding of this offering, we encourage you to read this entire document and the documents to which we have referred. Except where the context suggests otherwise, in this prospectus “ACSF” refers to American Capital Senior Floating, Ltd., a Maryland corporation, “ACSF Funding” refers to ACSF Funding I, LLC, a Delaware limited liability company and a wholly-owned special purpose financing vehicle of American Capital Senior Floating, Ltd., “we,” “us,” “our,” and “the Company” refer to American Capital Senior Floating, Ltd. and ACSF Funding I, LLC collectively, “our Manager” refers to American Capital ACSF Management, LLC, a Delaware limited liability company, and “American Capital” refers to American Capital, Ltd., a Delaware corporation.

Information contained or incorporated by reference in this prospectus or prospectus summary may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “intend,” “plans,” “anticipate,” “estimate” or “continue” or the negative thereof or other variations thereon or comparable terminology. The matters described in “Risk Factors” and certain other factors noted throughout this prospectus and in any exhibits to the registration statement of which this prospectus is a part, constitute cautionary statements identifying important factors with respect to any such forward-looking statements, including certain risks and uncertainties, that could cause actual results to differ materially from those in such forward-looking statements.

Our Company

On January 22, 2014, we completed our IPO and became an externally managed, non-diversified closed-end management investment company that has elected to be regulated as a BDC under the 1940 Act. We are an “emerging growth company,” as defined in Section 2(a) of the Securities Act. In addition, for tax purposes we intend to elect to be treated as a RIC under Subchapter M of the Code.

Our Manager

Our Manager is an indirect subsidiary of ACAM, which is a wholly-owned portfolio company of American Capital. Founded in 1986, American Capital is a publicly-traded private equity firm and global asset manager which directly and through its asset management business, originates, underwrites and manages investments in private equity, sponsored finance, real estate, energy and infrastructure, leveraged loans and CLOs. From its eight offices in the United States, Europe and Asia, American Capital had $81 billion in total assets under management (including levered assets) across its target asset classes as of June 30, 2015. Our Manager is responsible for administering our business activities and day-to-day operations, subject to the supervision and oversight of our board of directors (“Board of Directors” or “Board”). All of our officers and the members of our Manager’s senior investment team and other support personnel are employees of American Capital or the parent company of our Manager. Because neither we nor our Manager have any employees, our Manager has entered into an administrative services agreement with American Capital and the parent company of our Manager, pursuant to which our Manager will have access to their employees, including senior management and operations, finance, compliance, legal, capital markets, accounting, treasury, investor relations and information technologies staffs, and their infrastructure, operations, business relationships and management expertise, to enable our Manager to fulfill all of its responsibilities under the management agreement. Refer to “Risk Factors—Risks Related to Our relationship with Our Manager and American Capital” for additional information.

Investments

Our investment objective is to provide attractive, risk-adjusted returns over the long term primarily through current income while seeking to preserve our capital. We actively manage a leveraged portfolio composed primarily of diversified investments in first lien and second lien floating rate loans principally to large-market U.S.-based companies (collectively, “Senior Secured Floating Rate Loans” or “Loans”) which are commonly referred to as leveraged loans. S&P defines large-market loans as loans to issuers with EBITDA of greater than $50 million. We also invest in equity tranches of CLOs, which are securitized vehicles collateralized primarily by Loans and we may invest in debt tranches of CLOs. In addition, we may selectively invest in loans issued by middle market companies, mezzanine and unitranche loans and high yield bonds. Additionally, we may from time to time hold or invest in other equity investments and other debt or equity securities generally arising from a restructuring of Loan positions previously held by us. We utilize leverage to enhance our returns and we are limited under the 1940 Act as a BDC on the amount of leverage we can utilize.

Under normal market conditions, we will have at least 80% of our assets in Senior Secured Floating Rate Loans or CLOs that are pooled investment vehicles that invest substantially all of their assets in Senior Secured Floating Rate Loans. As a BDC,

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we are restricted from holding more than 30% of our assets in nonqualified investments, as defined by Section 55(a) of the 1940 Act. Investments in debt and equity tranches of CLOs are deemed nonqualified assets for BDC compliance purposes and therefore we are limited as to the amount of CLO investments we hold at any given time in our portfolio.

Summary Risk Factors

An investment in our Securities involves a high degree of risk. You should consider carefully the risks highlighted below and under the section entitled “Risk Factors” before investing in our Securities.

• Economic recessions or downturns may have a material adverse effect on our business, financial condition and results of operations, and could impair the ability of our portfolio companies to repay loans.

• We have limited operating history and may not be able to successfully operate our business or generate sufficient net interest income to make or sustain distributions to our stockholders.

• We operate in a highly competitive market for investment opportunities.

• We may experience fluctuations in our quarterly results.

• We will become subject to corporate-level income tax on all of our income if we are unable to qualify as a RIC under Subchapter M of the Code, which would have a material adverse effect on our financial performance.

• There are conflicts of interest in our relationship with our Manager and with American Capital.

• We have no employees and are completely dependent upon our Manager. Our Manager also has no employees and only nominal assets and relies on certain personnel of American Capital and the parent company of our Manager to provide services to it through the administrative services agreement. We may not find suitable replacements for our Manager and these personnel if the management agreement and the administrative services agreement are terminated or such personnel are no longer available to us. We are not a party to the administrative services agreement. Therefore, we do not have any recourse against American Capital or the parent company of our Manager if they do not fulfill their obligations under the administrative services agreement or elect to assign the agreement to an affiliate.

• Our Manager’s management fee is based on the amount of our total consolidated assets and is payable regardless of our performance.

• Regulations governing our operation as a BDC will affect our ability to, and the way in which we, raise additional capital. As a BDC, the necessity of raising additional capital may expose us to risks, including the typical risks associated with leverage.

• We may fail to raise adequate additional capital or debt financing, which would adversely affect our operations, including our ability to fund investments and pay distributions to our stockholders.

• There is uncertainty as to the value of our portfolio investments.

• Defaults by our portfolio companies would harm our operating results.

• Our investments in Senior Secured Floating Rate Loans involves a variety of risks, any of which may adversely impact our performance.

• Our investments in CLO securities will involve a high degree of risk and illiquidity, all of which may adversely affect our performance.

• Our engaging in hedging transactions may expose us to additional risks.

• The market price of our common stock may fluctuate significantly.

• Our shares of common stock may trade at a substantial discount from NAV and may continue to do so over the long term.

Our Corporate Information

Our and our Manager’s principal place of business is located at 2 Bethesda Metro Center, 14th Floor, Bethesda, Maryland 20814, and members of our Manager’s senior investment team are located at 505 Fifth Avenue, 26th Floor, New York, NY 10017. Our telephone number is 301-968-9310 and our Internet addresses is www.ACSF.com. The information found on, or otherwise accessible through, our website is not incorporated into, and does not form a part of, this prospectus or any other report or document we file with or furnish to the SEC.

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THE OFFERING

We may offer, from time to time, up to $250,000,000 of our Securities, on terms to be determined at the time of the offering. Our Securities may be offered at prices and on terms to be disclosed in one or more prospectus supplements. We are generally not able to issue and sell our common stock at a price below our NAV per share, exclusive of any underwriting commissions or discounts, except as otherwise noted herein. Additionally, as a BDC, we generally may not issue senior debt securities, debt securities and preferred stock (collectively “senior securities”) if our asset coverage ratio would be less than 200% after giving effect to such issuance, except to refinance existing senior securities. 

Our Securities may be offered directly to one or more purchasers, including existing stockholders in a rights offering, by us or through agents designated from time to time by us, or to or through underwriters or dealers. The prospectus supplement relating to the offering will disclose the terms of the offering, including the name or names of any agents or underwriters involved in the sale of our Securities by us, the purchase price, and any fee, commission or discount arrangement between us and our agents or underwriters or among our underwriters or the basis upon which such amount may be calculated. See “Plan of Distribution.” We may not sell any of our Securities through agents, underwriters or dealers without delivery of a prospectus supplement describing the method and terms of the offering of our Securities. 

Set forth below is additional information regarding the offering of our Securities:

The NASDAQ Global Select Market Symbol ACSF

Use of Proceeds Unless otherwise specified in a prospectus supplement, we intend to use the net proceeds from the sale of our Securities for general corporate purposes, which may include investing in portfolio companies in accordance with our investment objective and strategies, repayment of indebtedness and other general corporate purposes. See “Use of Proceeds.”

Distributions To the extent that we have taxable income available, we intend to continue to distribute monthly dividends to our stockholders. The amount of our dividends, if any, will be determined by our Board of Directors. Any dividends to our stockholders will be declared out of assets legally available for distribution. We anticipate that our dividends will be paid from taxable earnings, including interest and capital gains generated by our investment portfolio. However, if we do not generate sufficient taxable earnings during any fiscal year, a portion of our dividends for such year may constitute a return of capital. As a result, stockholders should not assume that all periodic dividends are paid from taxable earnings. The specific tax characteristics of our dividends will be reported to stockholders after the end of each calendar year.

Dividend Reinvestment and Stock Purchase Plan Our Board of Directors has adopted a dividend reinvestment and stock purchase plan. If your shares of common stock are registered in your own name, your distributions will automatically be reinvested under the plan in additional whole and fractional shares of common stock, unless you “opt out” of the plan so as to receive cash dividends by notifying our plan administrator by telephone, internet or in writing. If your shares are held in the name of a broker or other nominee, you should contact the broker or nominee for details regarding opting out of the plan. Under the optional cash purchase component of the plan, participants in the plan may also make optional cash purchases of shares of our common stock of between $50 and $10,000 per month and, with our prior approval, in excess of $10,000 per month. Stockholders who receive distributions in the form of stock will be subject to the same federal, state and local tax consequences as stockholders who elect to receive their distributions in cash; however, since their cash distributions will be reinvested, such stockholders will not receive cash with which to pay any applicable taxes on reinvested distributions. See “Dividend Reinvestment and Stock Purchase Plan.”

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Certain Takeover Defense Provisions Our charter and amended and restated bylaws (our “bylaws”), as well as certain statutory and regulatory requirements, contain certain provisions that may have the effect of discouraging a third party from making an acquisition proposal for us and thereby inhibit a change in control of us in circumstances that could give the holders of our common stock the opportunity to realize a premium over the then prevailing market price for our common stock. See “Risk Factors—Risks Related to Our Common Stock—Certain provisions in our charter and bylaws could discourage a change of control that our stockholders may favor, which could also adversely affect the market price of our common stock” and “Certain Provisions of the Maryland General Corporation Law and Our Charter and Bylaws.”

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FEES AND EXPENSES

The following table is intended to assist you in understanding the costs and expenses that an investor in our common stock will bear directly or indirectly. Stockholders should understand that some of the percentages indicated in the table below are estimates and may vary. Moreover, the information set forth below does not include any transaction costs and expenses that investors will incur in connection with each offering of our Securities pursuant to this prospectus. As a result, investors are urged to read the “Fees and Expenses” table contained in any corresponding prospectus supplement to fully understand the actual transaction costs and expenses they will incur in connection with each such offering. Except where the context suggests otherwise, whenever this prospectus contains a reference to fees or expenses paid by “us” or that “we” will pay fees or expenses, common stockholders will indirectly bear such fees or expenses.

Stockholder Transaction Expenses (as a percentage of common stock offering price)
Sales load	N/A		(1)
Offering expenses borne by us (as a percentage of offering price)	N/A		(2)
Dividend reinvestment and stock purchase plan fees	N/A		(3)
Total stockholder transaction expenses	—	%
Estimated Annual Expenses (as a percentage of net assets attributable to our common stock)			(4)
Management fees	1.58	%	(5)
Interest payments on borrowed funds	2.10	%	(6)
Other expenses	1.43	%	(7)
Total estimated annual expenses	5.11	%
Expense waiver	(0.65	)%	(8)
Total estimated annual expenses after expense waiver	4.46	%

 _____________________

(1) In the event that our Securities to which this prospectus relates are sold to or through underwriters, a corresponding prospectus supplement will disclose the applicable sales load.

(2) In the event that we conduct an offering of our Securities, a corresponding prospectus supplement will disclose the estimated offering expenses. Our common stockholders will bear, directly or indirectly, the expenses of any offering of our Securities, including debt securities.

(3) The de minimis expenses of our dividend reinvestment and stock purchase plan are included in “Other expenses.” See “Dividend Reinvestment and Stock Purchase Plan.”

(4) “Net assets attributable to our common stock” equals net assets as of June 30, 2015.

(5) Our management fee payable under the management agreement is calculated at an annual rate of 0.80% of our total consolidated assets, excluding cash and cash equivalents and net unrealized appreciation and depreciation, each as determined under generally accepted accounting principles in the United States of America (“GAAP”) at the end of the most recently completed fiscal quarter. Annual expenses are based on estimated annual costs for the current fiscal year, which are based on actual amounts incurred during the six months ended June 30, 2015, annualized for a full year. The management fee rate, as a percentage of net asset value, will fluctuate with changes in the amount of cash held and changes in the amount of unrealized appreciation and depreciation.

(6) Assumes borrowed amounts have the same financing terms as our $140 million secured revolving credit facility with Bank of America, N.A., as agent (the “Credit Facility”) as of June 30, 2015. Our leverage may vary periodically depending on market conditions, our portfolio composition and our Manager’s assessment of risks and returns. However, our total borrowings are limited so that our asset coverage ratio cannot fall below 200%, as defined in the 1940 Act. The borrowing costs included in the table above are estimated based on actual amounts incurred during the six months ended June 30, 2015, annualized for a full year. Included in the “Interest payments on borrowed funds” are deferred debt issuance costs which we amortize over the life of the loan. For purposes of the example above, the deferred debt issuance costs are assumed to recur annually at the same rate as of June 30, 2015.

(7) The “other expenses” reflect estimated amounts for the current fiscal year and include our overhead expenses, including our allocable portion of overhead and other expenses incurred by our Manager and its affiliates in performing its obligations under the management agreement and administrative services agreement. Amount is shown before incorporation of the expense waiver.

(8) Through the date of our 2016 Annual Meeting of Stockholders, our Manager has agreed to be responsible for certain of our operating expenses in excess of 0.75% of our consolidated net assets, less net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. Estimated annual other net expenses, after taking into consideration the expense waiver, are 0.78% of consolidated net assets.

Example

The following example demonstrates the projected dollar amount of total cumulative expenses that would be incurred over various periods with respect to a hypothetical investment in our common stock. These dollar amounts are based upon the assumption that our annual operating expenses and leverage would remain at the levels set forth in the table above. In the event

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that shares of our common stock to which this prospectus relates are sold to or through underwriters, a corresponding prospectus supplement will restate this example to reflect the applicable sales load.

	1 Year	3 Years	5 Years	10 Years
You would pay the following expenses on a $1,000 investment, assuming a 5% annual return	$45	$141	$247	$562

This example should not be considered a representation of our future expenses, and actual expenses may be greater or less than those shown. Moreover, while the example assumes (as required by the SEC) a 5% annual return, our performance will vary and may result in a return greater or less than 5%. In addition, while the example assumes reinvestment of all dividends and distributions at NAV, participants in our dividend reinvestment and stock purchase plan may receive shares purchased by the plan administrator at the market price in effect at the time, which may be at, above or below NAV. See “Dividend Reinvestment and Stock Purchase Plan.”

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ADDITIONAL INFORMATION

We have filed with the SEC a registration statement on Form N-2 under the Securities Act, with respect to the Securities offered by this prospectus. This prospectus, which is a part of the registration statement, does not contain all of the information set forth in the registration statement or exhibits and schedules thereto. For further information with respect to our business and our Securities, reference is made to the registration statement, including the amendments, exhibits and schedules thereto and the SAI, contained in the registration statement. 

We also file reports, proxy statements and other information with the SEC under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). You may read or copy such reports, proxy statements and other information, as well as the registration statement and the amendments, exhibits and schedules thereto, at the public reference facilities maintained by the SEC at 100 F Street, N.E., Washington, D.C. 20549. Information about the operation of the public reference facilities may be obtained by calling the SEC at (202) 551-8090. The SEC maintains a web site that contains reports, proxy statements and other information regarding registrants, including us, that file such information electronically with the SEC. The address of the SEC’s web site is www.sec.gov. Copies of such material may also be obtained from the Office of Investor Education and Advocacy of the SEC by written request, fax or email, to: 100 F Street, N.E., Washington, D.C. 20549, (202) 772-9295, or PublicInfo@sec.gov, respectively, at prescribed rates. Our common stock is listed on The NASDAQ Global Select Market and our corporate web site is located at www.ACSF.com. Information contained on our web site or on the SEC’s web site about us is not incorporated into this prospectus and you should not consider information contained on our web site or on the SEC’s web site to be part of this prospectus. 

We make available free of charge on our web site our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to those reports as soon as reasonably practicable after such material is electronically filed with or furnished to the SEC. We also furnish to our stockholders Annual Reports, which will include annual financial information that has been examined and reported on, with an opinion expressed, by our independent registered public accounting firm. See “Independent Registered Public Accounting Firm.”

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SELECTED CONDENSED CONSOLIDATED FINANCIAL DATA

($ in thousands, except per share data)

The selected financial and other data below should be read in conjunction with our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and notes thereto. Financial information is presented for the six months ended June 30, 2015, the fiscal year ended December 31, 2014 and the period from October 15, 2013 to December 31, 2013. The selected condensed consolidated financial data for the fiscal year ended December 31, 2014 and for the period from October 15, 2013 to December 31, 2013 has been derived from ACSF’s consolidated financial statements, which were audited by Ernst & Young LLP. The interim selected condensed consolidated financial data for the the six months ended June 30, 2015 has been derived from ACSF’s unaudited consolidated financial statements, which are incorporated herein.

	Six Months Ended June 30, 2015			Year Ended December 31, 2014			Period from October 15, 2013* to December 31, 2013
Consolidated Statement of Operations data:
Total investment income	$	9,621		$	17,773		$	1,572
Total expenses (net) (1)	$	3,341		$	6,914		$	1,326
Net investment income	$	6,280		$	10,859		$	246
Net realized and unrealized (loss) gain on investments	$	670		$	(7,070	)	$	769
Net increase in net assets resulting from operations	$	6,950		$	3,789		$	1,015
Per Share data:
Net asset value	$	14.54		$	14.42		n/a
Net investment income	$	0.63		$	1.09		n/a
Net realized and unrealized loss on investments	$	0.07		$	(0.71	)	n/a
Net increase in net assets resulting from operations	$	0.70		$	0.38		n/a
Distributions declared	$	0.58		$	1.03		n/a
Consolidated Balance Sheet data:
Investments, fair value	$	272,191		$	276,370		$	199,565
Cash and cash equivalents	$	2,458		$	1,757		$	12,493
Total assets	$	279,676		$	282,477		$	218,696
Revolving credit facility payable	$	123,800		$	130,000		$	194,748
Total net assets	$	145,364		$	144,235		$	1,016
Other data:
Total return based on market value (2)	9.09		%	(12.90		)%	n/a
Total return based on net asset value (2)	5.30		%	3.73		%	n/a
Investment purchases during the period	$	75,084		$	226,628		$	207,548
Investment sales and repayments during the period	$	83,528		$	148,461		$	9,790
Number of loan obligors at period end	127			117			69
Number of CLO issuers at period end	19			16			8
Yield on investment portfolio at period end	7.19		%	6.92		%	6.61		%

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* Commencement of operations

(1)Net expenses include tax expense included in net investment income.

(2)Total return is based on the change in market price or net asset value per share during the period and takes into account dividends reinvested in accordance with the dividend reinvestment and stock purchase plan. The IPO price of $15.00 per share was used as the starting value for the total return for the year ended December 31, 2014. Amount is not annualized for periods less than one year.

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RISK FACTORS

You should carefully consider the risks described below and all other information contained in this prospectus, including our consolidated financial statements and the related notes thereto, before making a decision to purchase our Securities. The risks and uncertainties described below are not the only ones relevant to your investment in us. Additional risks and uncertainties not presently known to us, or not presently deemed material by us, may also impair our operations and performance.

If any of the following risks actually occur, our business, financial condition or results of operations could be materially adversely affected, and you may lose all or part of your investment. The risks discussed below also include forward-looking statements, and our actual results may differ substantially from those discussed in these forward-looking statements.

Risks Relating to Economic Conditions

Economic recessions or downturns may have a material adverse effect on our business, financial condition and results of operations, and could impair the ability of our portfolio companies to repay loans

Economic recessions or downturns may result in a prolonged period of market illiquidity, which could have a material adverse effect on our business, financial condition and results of operations. Unfavorable economic conditions also could increase our funding costs, limit our access to the capital markets or result in a decision by lenders not to extend credit to us. These events could limit our investment originations, limit our ability to grow and negatively impact our operating results. In addition, if a recession were to occur, the financial condition of the portfolio companies in which we invest may deteriorate, which could ultimately lead to difficulty in meeting their debt service obligations to us and an increase in defaults. Additionally, the end markets for certain of our portfolio companies’ products and services would likely experience negative economic trends. The performance of certain of our portfolio companies may be negatively impacted by these economic or other conditions, which may ultimately result in our receipt of a reduced level of interest income from our portfolio companies and/or losses or charge offs related to our investments, and, in turn, may adversely affect distributable income. Further, adverse economic conditions may decrease the value of collateral securing some of our debt and CLO investments. As a result, the payment terms of our investments and/or cash interest rates may be modified. These factors may result in our receipt of a reduced level of interest income from our portfolio companies and/or losses or charge offs related to our investments, and, in turn, may adversely affect distributable income and have a material adverse effect on our results of operations.

Global economic, political and market conditions may materially and adversely affect our business, results of operations and financial condition, including our revenue growth and profitability

Past recessions have had a significant negative impact on the operating performance and fair value of Senior Secured Floating Rate Loans which comprise the majority of our investment portfolio. Many of our portfolio companies could be adversely impacted again by any future economic downturn or recession and may be unable to repay our investments, may be unable to be sold at a price that would allow us to recover our investment, or may be unable to operate during such downturn or recession. Worldwide financial market crises, as well as various social and political tensions in the United States and around the world, may cause increased market volatility, may have long-term effects on the United States and worldwide financial markets, and may cause economic uncertainties or deterioration in the United States and worldwide. Since 2010, several European Union (“EU”) countries, including Greece, Ireland, Italy, Spain, and Portugal, have faced budget issues, some of which may have negative long-term effects for the economies of those countries and other EU countries. There is continued concern about national-level support for the Euro and the accompanying coordination of fiscal and wage policy among European Economic and Monetary Union member countries. In addition, the fiscal policy of foreign nations, such as China, may have a severe impact on the worldwide and United States financial markets; the Ukraine peace talks may be derailed; and worldwide oil prices may continue to decrease and stay low for a prolonged period of time. We do not know how the financial markets will be affected by these events and cannot predict the effects of these or similar events in the future on the United States economy and securities markets or on our investments. We monitor developments and seek to manage our investments in a manner consistent with achieving our investment objective, but there can be no assurance that we will be successful in doing so. Such investment performance could have a material adverse effect on our business, financial condition and results of operations.

A disruption in capital markets could negatively affect our business

As a BDC, we may need access to the capital markets to maintain our ability to either refinance existing indebtedness or raise additional capital for investment and growth purposes. Without sufficient access to the capital markets, we may be forced to curtail our business operations or we may not be able to pursue new business opportunities. Disruptive conditions in the financial industry and the impact of new legislation in response to those conditions could restrict our business operations and could adversely impact our results of operations and financial condition. If the fair value of our assets declines substantially, we may not maintain the asset coverage ratios required by the 1940 Act, which would affect our ability to issue senior securities, including borrowings, and pay dividends, and could materially impair our business operations. Our liquidity could be impaired further by an inability

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to access the capital markets. Equity capital may be difficult to raise because, subject to some limited exceptions, as a BDC, we will generally not be able to issue additional shares of our common stock at a price less than NAV. In addition, our ability to incur indebtedness or issue preferred stock will be limited by applicable regulations such that our asset coverage, as defined in the 1940 Act, must equal at least 200% immediately after each time we incur indebtedness or issue preferred stock. The debt capital that will be available, if at all, may be at a higher cost and on less favorable terms and conditions in the future. Any inability to raise capital could have a negative effect on our business, financial condition and results of operations. These situations may arise due to circumstances that we may be unable to control, such as inaccessibility to the credit markets, a severe decline in the value of the U.S. dollar, an economic downturn or an operational problem that affects third parties or us, and could materially damage our business. Moreover, we are unable to predict when economic and market conditions may become more favorable or worsen. Even if such conditions improve broadly and significantly over the long term, adverse conditions in particular sectors of the financial markets could adversely impact our business.

Risks Related to Our Business and Structure

We have limited operating history

We were formed in February 2013, acquired our initial portfolio in the period from October through December 2013 and completed our IPO in January 2014. As a result of our short operating history, we are subject to many of the business risks and uncertainties associated with recently formed businesses, including the risk that we will not achieve our investment objective and that the value of your investment could decline substantially.

We are dependent upon American Capital’s key management personnel for our future success

We depend on the diligence and skill of senior management and other members of management of American Capital and certain of its affiliates for raising capital and the selection, structuring, closing and monitoring of our investments. Our future success depends to a significant extent on the continued service of such senior management and other members of management. We cannot assure you that any such individual will not terminate his or her relationship with us. The departure of certain of our executive officers or key employees of American Capital and certain of its affiliates could materially adversely affect our ability to implement our business strategy. In addition, we can offer no assurance that American Capital ACSF Management, LLC will remain our Manager. Our Manager’s senior investment team is and may in the future become affiliated with entities engaged in business activities similar to those conducted by us, and may have conflicts of interest in allocating their time. Our Manager’s senior investment team dedicates a significant portion of their time to our activities; however, they may be engaged in other business activities that could divert their time and attention in the future.

We operate in a highly competitive market for investment opportunities

Many entities compete with us for investments in our target portfolio companies. Our primary competitors include other BDCs and CLO investors, other credit focused investment funds, commercial and investment banks, commercial financing companies, insurance companies and, to the extent they provide an alternative form of financing, hedge funds. Many of our potential competitors are substantially larger and have considerably greater financial, technical and marketing resources than we do. For example, some competitors may have a lower cost of funds and access to funding sources that may not be available to us. In addition, some of our competitors may have higher risk tolerances or different risk assessments than we do, which could allow them to consider a wider variety of investments and establish more relationships than we can. Furthermore, many of our competitors are not subject to the regulatory restrictions that the 1940 Act imposes on us. We cannot assure you that the competitive pressures we face will not have a material adverse effect on our business, financial condition and results of operations. Also, as a result of this competition, we may not be able to take advantage of attractive investment opportunities from time to time, and we can offer no assurance that we will be able to identify and make investments that are consistent with our investment goals.

We may experience fluctuations in our quarterly results

We may experience material fluctuations in our quarterly operating results due to many factors, including changes in the credit quality of our portfolio, changes in the fair value of our portfolio, changes in the amount of loans on non-accrual status, changes in interest rates and changes in our expenses. Therefore, results for any historical period are not indicative of performance in future periods.

We incur significant costs as a result of being a publicly traded company

As a publicly-traded company, we incur legal, accounting and other expenses, including costs associated with the periodic reporting requirements applicable to a company whose securities are registered under the Exchange Act, as well as additional corporate governance requirements, including requirements under the Sarbanes-Oxley Act, and other rules implemented by the SEC and the listing standards of the NASDAQ Stock Market. Upon ceasing to qualify as an emerging growth company under the JOBS Act, our independent registered public accounting firm will be required to attest to the effectiveness of our internal control

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over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act, which will increase costs associated with our periodic reporting requirements.

If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud, which could cause stockholders to lose confidence in our financial and other public reporting and harm our business and the trading price of our common stock

Effective internal controls over financial reporting are necessary for us to provide reliable financial reports and, together with adequate disclosure controls and procedures, are designed to prevent fraud. Any failure to implement required new or improved controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations. In addition, any testing by us conducted in connection with Section 404 of the Sarbanes-Oxley Act, or the subsequent testing by our independent registered public accounting firm (when undertaken, as noted in the next paragraph), may reveal deficiencies in our internal control over financial reporting that are deemed to be material weaknesses or that may require prospective or retroactive changes to our financial statements or identify other areas for further attention or improvement. Ineffective internal controls over financial reporting could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our common stock.

We are required to disclose changes made in our internal control on financial reporting on a quarterly basis and our management is required to assess the effectiveness of these controls annually. However, for as long as we are an “emerging growth company” under the recently enacted JOBS Act, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act. We could be an emerging growth company for up to five years from the date of our IPO. An independent assessment of the effectiveness of our internal controls could detect problems that our management’s assessment might not detect. Undetected material weaknesses in our internal controls could lead to financial statement restatements and require us to incur the expense of remediation.

The Investment Committee and/or our Board of Directors may change our operating policies, guidelines and strategies without prior notice or stockholder approval, which may adversely affect your investment in us

The Investment Committee and/or our Board of Directors has the authority to modify or waive our operating policies, guidelines and strategies without prior notice and without stockholder approval. We cannot predict the effect any changes to our operating policies, guidelines and strategies would have on our business, NAV, operating results and the value of our stock. However, the effects could negatively impact our ability to pay you distributions and cause you to lose part or all of your investment.

Changes in laws or regulations governing our operations or our non-compliance with those laws or regulations may adversely affect our business or cause us to alter our business strategy

We and our portfolio companies are subject to regulation by laws at the local, state, federal and foreign levels, including with respect to securities laws, tax and accounting standards. These laws and regulations, as well as their interpretation, may be changed from time to time. Accordingly, any change in these laws or regulations or our non-compliance with these laws or regulations could have a material adverse impact on our business. Certain of these laws and regulations pertain specifically to BDCs. Additionally, any changes to the laws and regulations governing our operations relating to permitted investments may cause us to alter our investment strategy in order to avail ourselves of new or different opportunities. Such changes could result in material differences to the strategies and plans set forth in this prospectus and may result in our investment focus shifting from the areas of expertise of our Manager and its affiliates to other types of investments in which our Manager and its affiliates may have less expertise or little or no experience. Thus, any such changes, if they occur, could have a material adverse effect on our results of operations and the value of your investment. On October 22, 2014, six federal agencies approved a final rule requiring sponsors of securitization transactions to retain risk in those transactions. The final rule implemented the risk retention requirements in the Dodd-Frank Wall Street Reform and Consumer Protection Act. The final rule largely retained the risk retention framework contained in the proposal issued by the agencies in August 2013 and generally required sponsors of asset-backed securities (“ABS”) to retain not less than five percent of the credit risk of the assets collateralizing the ABS issuance. The rule also set forth prohibitions on transferring or hedging the credit risk that the sponsor was required to retain. In spite of calls from CLO and leveraged loan market participants for certain exemptions from the risk retention requirements in the final rule for CLOs, the agencies declined to create an exemption for open market CLOs or to create a third-party risk retention alternative for open market CLOs, citing ongoing concerns about the leveraged loan market, including systemic risk resulting from the origination and pooling of leveraged loans with poor underwriting standards. Certain limited exemptions granted by the final rule were generally considered to be inconsistent with the current market practice in the leveraged loan market and were not expected to be widely utilized. The implementation of such risk retention rules by CLOs or any shift in the market practice in the leveraged loan market could have a material impact on our future investments in CLOs.

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It is unclear how increased regulatory oversight and changes in the method for determining LIBOR may affect the value of the financial obligations to be held or issued by us that are linked to LIBOR, or how such changes could affect our results of operations or financial condition

Senior Secured Floating Rate Loans pay interest based on a floating rate calculated as a spread over a market index. The London-Interbank Offered Rate (“LIBOR”) is generally used as the market index for Senior Secured Floating Rate Loans. Beginning in 2012, a number of British Bankers’ Association (“BBA”) member banks entered into settlements with certain regulators and law enforcement agencies with respect to the alleged manipulation of LIBOR, and there remain ongoing investigations into the matter by regulators and governmental authorities in various jurisdictions. Following a review of LIBOR conducted at the request of the U.K. government, on September 28, 2012, recommendations for reforming the setting and governing of LIBOR were released, which are referred to as the Wheatley Review. The Wheatley Review made a number of recommendations for changes with respect to LIBOR, including the introduction of S-5 statutory regulation of LIBOR, the transfer of responsibility for LIBOR from the BBA to an independent administrator, changes to the method of the compilation of lending rates and new regulatory oversight and enforcement mechanisms for ratesetting and a reduction in the number of currencies and tenors for which LIBOR is published. Based on the Wheatley Review and on a subsequent public and governmental consultation process, on March 25, 2013, the U.K. Financial Services Authority published final rules for the U.K. Financial Conduct Authority’s regulation and supervision of LIBOR, which are referred to as the FCA Rules. In particular, the FCA Rules include requirements that (1) an independent LIBOR administrator monitor and survey LIBOR submissions to identify breaches of practice standards and/or potentially manipulative behavior, and (2) firms submitting data to LIBOR establish and maintain a clear conflicts of interest policy and appropriate systems and controls. The FCA Rules took effect on April 2, 2013. It is uncertain what additional regulatory changes or what changes, if any, in the method of determining LIBOR may be required or made by the U.K. government or other governmental or regulatory authorities. Accordingly, uncertainty as to the nature of such changes may adversely affect the market for or value of any LIBOR-linked securities, loans, derivatives and other financial obligations or extensions of credit held by or due to us or on our overall financial condition or results of operations. In addition, any further changes or reforms to the determination or supervision of LIBOR may result in a sudden or prolonged increase or decrease in reported LIBOR, which could have an adverse impact on the market for or value of any LIBOR linked securities, loans, derivatives and other financial obligations or extensions of credit held by or due to us or on our overall financial condition or results of operations.

We are an “emerging growth company,” and we do not know if such status makes our common stock less attractive to investors

We currently are an “emerging growth company,” as defined in the JOBS Act, until the earliest of:

• the last day of our fiscal year ending December 31, 2019;

• the year in which our total annual gross revenues first exceed $1 billion;

• the date on which we have, during the prior three-year period, issued more than $1 billion in non-convertible debt; or

• the last day of a fiscal year in which we (1) have an aggregate worldwide market value of our common stock held by non-affiliates of $700 million or more, computed at the end of each fiscal year as of the last business day of our most recently completed second fiscal quarter, and (2) have been an Exchange Act reporting company for at least one year (and filed at least one annual report under the Exchange Act).

We intend to take advantage of some of the reduced regulatory and disclosure requirements permitted by the JOBS Act and, as a result, some investors may consider our common stock less attractive, which could reduce the market value of our common stock. For example, while we are an emerging growth company, we intend to take advantage of the exemption from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that our independent registered public accounting firm provide an attestation report on the effectiveness of our internal control over financial reporting. This may increase the risk that any material weaknesses or other deficiencies in our internal control over financial reporting may go undetected.

Any failure on our part to maintain our status as a BDC would reduce our operating flexibility

Our Board of Directors may determine that it is in our best interests to withdraw our BDC election, subject to the consent of the holders of a majority of our outstanding voting securities, as required under the 1940 Act. If we do not remain a BDC, we would likely be regulated as a closed-end investment company under the 1940 Act. Such regulation would subject us to substantially more regulatory restrictions under the 1940 Act and correspondingly decrease our operating flexibility, which could have a material adverse effect on our business, financial condition and results of operations.

We may have difficulty satisfying the annual distribution requirement in order to qualify and maintain RIC status if we recognize income before or without receiving cash representing such income

For federal income tax purposes, we will include in income certain amounts that we have not yet received in cash, such as original issue discount (“OID”). In addition, we may have to continue to recognize interest income for federal income tax purposes on a defaulted loan investment that has not paid the interest contractually owed to us. We also may be required to include in income certain other amounts that we will not receive in cash. For example, for certain investments, we may accrue income at

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some point after the trade date and before settlement, but we will not receive such income until settlement, which, in certain situations, can be as long as 90 days. Because in certain cases we may recognize income before or without receiving cash representing such income, we may have difficulty satisfying the annual distribution requirement applicable to RICs. Accordingly, we may have to sell some of our investments at times we would not consider advantageous, raise additional debt or equity capital or reduce new investments to meet these distribution requirements. If we are not able to obtain cash from other sources, we may not qualify for RIC tax treatment and thus be subject to corporate-level income tax. Additionally, we may never collect the cash representing such income.

We will become subject to corporate-level income tax if we are unable to qualify and maintain our qualification as a RIC under Subchapter M of the Code

Although we intend to elect to be treated as a RIC under Subchapter M of the Code for 2014 and succeeding tax years, no assurance can be given that we will be able to qualify for and maintain RIC status. To obtain and maintain RIC tax treatment under the Code, we must meet numerous annual distribution, income source and asset diversification requirements. We provide no assurances we will meet those requirements.

In addition, once we have elected and qualified to be taxed as a RIC, our Board of Directors may determine, without stockholder approval, that it is in our best interests to withdraw our RIC tax status election.

Loss of RIC tax status could substantially reduce net assets and income available for debt service and distributions

If we operate as a RIC, we generally will not be subject to corporate-level income taxation on income we timely distribute, or deem to distribute, to our stockholders as distributions. We would cease to qualify for such tax treatment if we were unable to comply with these requirements. In addition, we may have difficulty meeting the requirement to make distributions to our stockholders because in certain cases we may recognize income before or without ever receiving cash representing such income. If we fail to qualify as a RIC, we will have to pay corporate-level taxes on all of our income whether or not we distribute it, which would substantially reduce the amount of income available for debt service as well as reduce and/or affect the character and amount of our distributions to our stockholders.

Risks Related to Our Relationship with Our Manager and American Capital

Our management agreement was not negotiated on an arm’s-length basis and the terms, including fees payable, may not be as favorable to us as if they were negotiated with an unaffiliated third-party

Our management agreement with our Manager was negotiated between related parties, and we did not have the benefit of arm’s-length negotiations of the type normally conducted with an unaffiliated third-party. The terms of the management agreement, including fees payable, may not reflect the terms that we may have received if it were negotiated with an unrelated third-party. In addition, we may choose not to enforce, or to enforce less vigorously, our rights under the management agreement because of our desire to maintain our ongoing relationship with our Manager.

Our results are dependent upon the efforts of our Manager

Our Manager’s success, which is largely determinative of our own success, depends on many factors, including (i) the availability of attractive risk-adjusted investment opportunities that satisfy our targeted investment strategies, (ii) our Manager’s ability to identify and cause us to consummate those investment opportunities on favorable terms, and (iii) the existence of appropriate levels and stability of interest rates and suitable conditions in the financial markets and the economy. There can be no assurance regarding the occurrence or existence of these factors. In addition, our Manager may face substantial competition for attractive investment opportunities. Our Manager may not be able to successfully cause us to make investments with attractive risk-adjusted returns.

We are completely dependent upon our Manager and certain personnel of American Capital who provide services to us through the management agreement and the administrative services agreement and we may not find suitable replacements for our Manager and these personnel if the management agreement and the administrative services agreement are terminated or such personnel are no longer available to us

Because we have no employees, we are completely dependent on our Manager and its affiliates to conduct our operations pursuant to the management agreement. Our Manager does not have any employees and relies upon certain employees of American Capital and the parent company of our Manager to conduct our day-to-day operations pursuant to an administrative services agreement. Under the administrative services agreement, our Manager is provided with those services and resources necessary for our Manager to perform its obligations and responsibilities under the management agreement in exchange for certain fees payable by our Manager. Neither the administrative services agreement nor the management agreement requires our Manager or American Capital to dedicate specific personnel to our operations. They also do not require any specific personnel of our Manager or American Capital to dedicate a specific amount of time to our business. Additionally, because our Manager is relying upon

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American Capital, we may be negatively impacted by events or factors that negatively impact American Capital’s business, financial condition or results of operations.

If we terminate the management agreement without cause, we may not, without the consent of our Manager, employ any employee of our Manager or any of its affiliates, including American Capital, or any person who has been employed by our Manager or any of its affiliates at any time within the two-year period immediately preceding the date on which the person commences employment with us for two years after such termination of the management agreement. We believe that the successful implementation of our investment, financing and hedging strategies depends upon the experience of certain of American Capital’s and our Manager’s officers. However, none of these individuals’ continued service is guaranteed. Furthermore, if the management agreement is terminated or these individuals leave American Capital, we may be unable to execute our business plan.

There are conflicts of interest in our relationship with our Manager and American Capital

Because we have no employees, our Manager is responsible for making all of our investment decisions. All of our and our Manager’s officers are employees of American Capital or the parent company of our Manager and these persons do not devote their time exclusively to us. Our Manager’s Investment Committee consists of Malon Wilkus, John Erickson, Samuel Flax, Mark Pelletier and Thomas McHale, each of whom is an officer of our Manager and has significant responsibilities to American Capital and certain of its portfolio companies, affiliated entities or managed funds. Mr. Pelletier is the President of our Manager and also serves as our President and Chief Investment Officer, with primary oversight for all of our investments. Mr. Pelletier is also the President of American Capital CLO Management, LLC, the external manager of ACAS CLO 2007-1, Ltd., ACAS CLO 2012-1, Ltd., ACAS CLO 2013-1, Ltd., ACAS CLO 2013-2, Ltd., ACAS CLO 2014-1, Ltd., ACAS CLO 2014-2, Ltd. and ACAS CLO 2015-1, Ltd., which also invest in Senior Secured Floating Rate Loans. As a result, such funds may compete with us for investments. American Capital CLO Management, LLC is an indirect subsidiary of ACAM, a wholly-owned portfolio company of American Capital. Thus, Mr. Pelletier has, and may in the future have, significant responsibilities for American Capital or other funds that are managed by affiliates thereof. In addition, because certain of our and our Manager’s officers are also responsible for providing services to American Capital and/or certain of its portfolio companies, affiliated entities or managed funds, they may not devote sufficient time to the management of our business operations. In addition, there are no restrictions on American Capital that would prevent American Capital from sponsoring another investment vehicle that competes with us. Accordingly, American Capital or one or more of its affiliates may also compete with us for investments.

Although our Manager and its affiliates have policies in place to seek to mitigate the effects of conflicts of interest, these policies will not eliminate the conflicts of interest that our and our Manager’s officers and the employees of American Capital and certain of its affiliates will face in making investment decisions on behalf of American Capital, any other American Capital-sponsored investment vehicles and us. Further, we do not have any agreement or understanding with American Capital that would give us any priority over American Capital, any of its affiliates, or any such American Capital-sponsored investment vehicle in opportunities to invest in Senior Secured Floating Rate Loans, CLOs or any other investments we may make. Accordingly, we may compete for access to the benefits that we expect from our relationship with our Manager and American Capital.

We have no recourse to American Capital if it does not fulfill its obligations under the administrative services agreement

Neither we nor our Manager have any employees. Our day-to-day operations are conducted by employees of American Capital or the parent company of our Manager pursuant to an administrative services agreement among our Manager, American Capital and the parent company of our Manager. Under the administrative services agreement, our Manager is also provided with the services and other resources necessary for our Manager to perform its obligations and responsibilities under the management agreement in exchange for certain fees payable by our Manager. Although the administrative services agreement may not be terminated unless the management agreement has been terminated pursuant to its terms, American Capital may assign its rights and obligations thereunder to any of its affiliates, including ACAM, the sole member of the parent company of our Manager. In addition, because we were not a party to the administrative services agreement, we do not have any recourse to American Capital or the parent company of our Manager if they do not fulfill their obligations under the administrative services agreement or if they elect to assign the agreement to one of their affiliates. Also, our Manager only has nominal assets and we have limited recourse against our Manager under the management agreement to remedy any liability to us from a breach of contract or fiduciary duties.

Our Manager can resign upon not more than 60 days’ notice, and we may not be able to find a suitable replacement within that time, resulting in a disruption in our operations that could adversely affect our financial condition, business and results of operations

Our Manager has the right, under the management agreement, to resign at any time upon not more than 60 days’ written notice, whether we have found a replacement or not. If our Manager resigns, we may not be able to find a new manager or hire internal management with similar expertise and ability to provide the same or equivalent services on acceptable terms within 60 days, or at all. If we are unable to do so quickly, our operations are likely to experience a disruption, our financial condition, business and results of operations as well as our ability to pay distributions are likely to be adversely affected and the market price of our shares may decline. In addition, the coordination of our internal management and investment activities is likely to suffer if we are unable to identify and reach an agreement with a single institution or group of executives having the expertise possessed

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by our Manager and its affiliates. Even if we are able to retain comparable management, whether internal or external, the integration of such management and their lack of familiarity with our investment objective may result in additional costs and time delays that may adversely affect our financial condition, business and results of operations.

Our Manager’s management fee is based on the amount of our total consolidated assets and is payable regardless of our performance

Our Manager is entitled to receive a quarterly management fee from us that is based on the amount of our total consolidated assets, excluding our cash and cash equivalents and net unrealized appreciation or depreciation. The amount of the quarterly management fee is equal to one-fourth of 0.80% of our total consolidated assets, excluding our cash and cash equivalents and net unrealized appreciation or depreciation. Accordingly, if we experience a net loss during a quarter as a result of net unrealized depreciation of our investments, the decline in our total consolidated assets from such net unrealized depreciation will not reduce our management fee payable to our Manager. Also, any new investments funded with the cash proceeds received from the issuances of equity or debt will result in an increase in our total consolidated assets and therefore an increase in the management fee payable to our Manager, which could result in a conflict of interest between our Manager and our stockholders with respect to the timing and terms of our equity and debt issuances. While our stockholders will bear the risk of our future equity issuances reducing the price of our common stock and diluting the value of their stock holdings in us and will bear the risk of additional leverage from future debt issuances, the compensation payable to our Manager will increase as a result of future issuances of our equity and debt securities. Our Manager’s entitlement to substantial nonperformance-based compensation may reduce its incentive to devote sufficient time and effort to seeking investments that provide attractive risk-adjusted returns for our investment portfolio. This in turn could harm both our ability to make distributions to our stockholders and the market price of our common stock.

Our Manager’s liability is limited under the management agreement, and we have agreed to indemnify our Manager against certain liabilities

The management agreement provides that our Manager and its affiliates and their respective directors, officers, employees, members, managers, partners and stockholders shall not be liable to us or our subsidiaries or our and our subsidiaries’ respective directors, officers, employees, members, managers, partners or stockholders for any action taken or omitted to be taken by our Manager in connection with the performance of any of its duties or obligations under the management agreement or otherwise as a manager or investment adviser, except to the extent specified in Section 36(b) of the 1940 Act concerning loss resulting from a breach of fiduciary duty (as the same is finally determined by judicial proceedings) with respect to the receipt of compensation for services. The management agreement also provides that our Manager and its affiliates and their respective directors, officers, employees, members, managers, partners and stockholders are entitled to indemnification from us from and against any claims or liabilities (including reasonable legal fees and other expenses reasonably incurred, arising out of or in connection with our business and operations or any action taken or omitted on our behalf pursuant to authority granted by the management agreement) to the fullest extent such indemnification is then permitted under our charter, the 1940 Act, the Investment Advisers Act of 1940, the laws of the State of Maryland and any other applicable law.

We may not replicate the historical results achieved by other entities managed by members of the Investment Committee, or by American Capital or its affiliates

Our investments may differ from those of other entities managed by American Capital, its affiliates or members of the Investment Committee. Investors in our securities are not acquiring an interest in any such entities. We may consider co-investing in portfolio investments with other investment vehicles sponsored or managed by members of the Investment Committee, American Capital or its affiliates as permitted under applicable regulations and our policies and procedures. We can offer no assurance, however, that we will develop such permitted opportunities. We also cannot assure you that we will replicate the historical results achieved by members of the Investment Committee or other entities managed by American Capital or its affiliates, and we caution you that our investment returns could be substantially lower than the returns achieved by them in prior periods. Additionally, all or a portion of the prior results may have been achieved in particular market conditions that may never be repeated. Moreover, current or future market volatility and regulatory uncertainty may have an adverse impact on our future performance.

Our ability to enter into transactions with our affiliates is restricted

We are prohibited under the 1940 Act from participating in certain transactions with certain of our affiliates without the prior approval of the members of our independent directors and, in some cases, the SEC. An affiliate under the 1940 Act includes, among others, any person that owns, directly or indirectly, 5% or more of our outstanding voting securities. We generally are prohibited from buying or selling any securities (other than our securities) or other investments from or to such affiliate, absent the prior approval of our independent directors. The 1940 Act also prohibits certain “joint” transactions with certain of our affiliates, which could include investments in the same portfolio company (whether at the same or different times), without prior approval of our independent directors and, in some cases, the SEC. These restrictions limit our ability to transact business with our officers or directors or their affiliates. As a result of these restrictions, we may be prohibited from buying or selling any security (other than any security of which we are the issuer) or other investments from or to any portfolio company of a fund managed by an

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affiliate of American Capital without the prior approval of the SEC, which may limit the scope of investment opportunities that would otherwise be available to us. We can offer no assurance that we will seek or be able to obtain such SEC approval.

ACAM owns approximately 3% of our common stock, which could result in its influence over the outcome of matters submitted to the vote of our stockholders

As of June 30, 2015, ACAM owned approximately 3% of our outstanding common stock. As a result, ACAM and American Capital may have influence over the outcome of matters submitted to a vote of our stockholders, including the election of our directors or transactions involving a change in control. Their interests may conflict with, or differ from, the interests of our other stockholders, including you. So long as ACAM continues to own shares of our common stock, it and American Capital could influence our corporate decisions submitted to our stockholders for approval, regardless of whether we terminate the management agreement with our Manager.

Risks Related to Liquidity and Capital Resources

We may need to raise additional capital to grow because we must distribute most of our income

We may need additional capital to fund growth in the future. A reduction in the availability of new capital could limit our ability to grow. We must distribute at least 90% of our investment company taxable income to our stockholders to maintain our RIC status. As a result, any such cash earnings may not be available to fund our investments. We may borrow from financial institutions and issue additional debt and equity securities. If we do not obtain funds from such sources or from other sources to fund our investments, it could limit our ability to grow, which may have an adverse effect on our stock price. In addition, as a BDC, our ability to borrow or issue preferred stock may be restricted if our total assets are less than 200% of our total borrowings and preferred stock.

The 1940 Act limits our ability to issue senior securities in certain circumstances

As a BDC, the 1940 Act generally limits our ability to issue senior securities if our asset coverage ratio does not exceed 200% immediately after each issuance of senior securities or is improved immediately upon the issuance. Asset coverage ratio is defined in the 1940 Act as the ratio that the value of the total assets, less all liabilities and indebtedness not represented by senior securities, bears to the aggregate amount of senior securities representing indebtedness. There are no assurances that we will always operate above this ratio. The resulting restrictions on issuing senior securities could have a material adverse impact on our business operations to the extent we do not maintain such asset coverage ratio.

The 1940 Act limits our ability to issue equity below our NAV per share

As a BDC, the 1940 Act generally limits our ability to issue and sell our common stock at a price below our NAV per share, exclusive of any distributing commission or discount, without stockholder approval. As of the date of this filing, we do not have such approval; however, we may seek such approval in the future or we may elect to conduct a rights offering, which would not require stockholder approval under the 1940 Act. If our common stock trades at a price below our NAV per share, there are no assurances that we can issue or sell shares of our common stock if needed to fund our business. In addition, in certain instances where we could issue or sell shares of our common stock at a price below our NAV per share, including through our dividend reinvestment and stock purchase plan or through a rights offering, such issuance could result in dilution in our NAV per share, which could result in a decline of our stock price.

We fund a portion of our investments with debt securities, which magnifies the potential for loss and the risks of investing in us

As a result of any issuance of debt securities, we would be exposed to typical risks associated with leverage, including an increased risk of loss and an increase in expenses, which are ultimately borne by our common stockholders. Payment of interest on such debt securities must take preference over any other dividends or other payments in respect of our common stock (or any preferred stock that we may issue in the future). If we issue debt securities, it is likely that such securities will be governed by an indenture or other instrument containing covenants restricting our operating flexibility. In addition, such securities may be rated by rating agencies, and in obtaining a rating for such securities, we may be required to abide by operating and investment guidelines that could further restrict our operating flexibility. Furthermore, any amounts that we use to service our indebtedness would not be available for distributions in respect of our common stock (or any preferred stock that we may issue in the future).

We may in the future determine to fund a portion of our investments with preferred stock, which would magnify the potential for loss and the risks of investing in us in the same way as our borrowings

Preferred stock, which is another form of leverage, has similar risks to our common stockholders as borrowings because the dividends on any preferred stock we issue must be cumulative and they would rank “senior” to common stock in our capital structure. Payment of dividends on, and repayment of the liquidation preference of, such preferred stock would typically take preference over any dividends or other payments to our common stockholders. Also, preferred stockholders are not typically

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subject to any of our expenses or losses and are not entitled to participate in any income or appreciation in excess of their stated preference. Furthermore, preferred stockholders would have separate voting rights and may have rights, preferences or privileges more favorable than those of our common stockholders. Also, the issuance of preferred securities could have the effect of delaying, deferring or preventing a transaction or a change of control that might involve a premium price for our common stockholders or otherwise be in our common stockholders’ best interest.

The agreements governing our current and any future credit facilities may contain various covenants which, if not complied with, could accelerate repayment under the relevant facility, thereby materially and adversely affecting our liquidity, financial condition, results of operations and our ability to pay distributions to our stockholders

We finance our assets with secured debt. Our current credit facility does, and any future such credit facilities are likely to, contain default provisions such as the failure to make principal and interest payments when due; the failure to maintain a certain borrowing base; the insolvency or bankruptcy of us or the relevant financing subsidiary; and the decline of our or the relevant financing subsidiary’s NAV, as applicable, below a specified threshold.

An event of default under the relevant facility may result, among other things, in the termination of the availability of further funds under the relevant facility and an accelerated maturity date for all amounts outstanding thereunder. This could disrupt our business, reduce our revenues, cause us to take losses, delay any dividends allowed to us under the facility until the lender has been paid in full, reduce our liquidity and cash flow and impair our ability to grow our business, make distribution payments to our stockholders and maintain our status as a RIC. In addition, each borrowing under our current (and any future) credit facility will be subject to the satisfaction of certain conditions. We cannot assure you that we will be able to borrow funds under the relevant facility at any particular time or at all.

Risks Related to Our Investing and Financing Strategy

There is uncertainty regarding the value of our portfolio investments

A substantial portion of our portfolio investments are not publicly traded. We determine the fair value of these investments in accordance with the 1940 Act and Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures (“ASC 820”) based on a determination made in good faith by our Board of Directors. For our investments that are not publicly traded, our determinations of fair value will be based upon certain inputs and our own assumptions about how market participants would price the asset or liability. Due to the uncertainty inherent in valuing investments that are not publicly traded, our determination of fair value may differ materially from the values that would exist if a ready market for these investments existed. Our determination of the fair value of our investments will have a material impact on our net earnings and NAV.

Changes in interest rates may increase our cost of capital, reduce the ability of our portfolio companies to service their debt obligations and adversely affect our profitability

General interest rate fluctuations and changes in credit spreads on floating rate loans may have a substantial negative impact on our investments and investment opportunities and, accordingly, may have a material adverse effect on our rate of return on invested capital, our net investment income, our NAV and the market price of our common stock. A substantial portion of our debt investments have variable interest rates that reset periodically based on benchmarks such as LIBOR and the prime rate. Thus, an increase in interest rates from their historically low present levels may make it more difficult for our portfolio companies to service their obligations under the debt investments that we hold.

Given the low absolute level of interest rates, many of our debt investments have floors or benchmark minimums which are currently in excess of the actual benchmark rate in the market. Currently our financing facility is based on a similar benchmark but does not have any floors associated with it. Therefore any such increase to interest rates would make it more expensive to use debt to finance our investments. As such, our earnings will be affected by the spread between the interest rate on our investments and the interest rate at which we borrow funds. As a result, we can offer no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income in the event we use floating rate debt to finance our investments. Additionally, in periods of rising interest rates, our cost of funds could reset at rates faster than those of our assets, which could reduce our net investment income. These risks are also prevalent in our CLO investments where the floating rate collateral assets may have benchmark floors while its debt may have a floating component without a floor or minimum base rate. As such, the spread compression risk explained above could be magnified in our CLO investments due to the higher leverage deployed resulting in a negative impact to our earnings and NAV.

A change in currency exchange rates may adversely affect our profitability

We may make investments in debt instruments that are denominated in currencies other than the U.S. dollar. Our domestic portfolio companies may also transact a significant amount of business in foreign countries and therefore their profitability may

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be impacted by changes in foreign currency exchange rates. As a result, an adverse change in currency exchange rates may have a material adverse impact on our business, financial condition and results of operations.

We may be unable to invest proceeds from investment sales/repayments or follow-on offerings of shares of our common stock on acceptable terms within an attractive time frame

Delays in investing the proceeds from investment sales or repayments along with any net proceeds raised in follow-on offerings of shares of our common stock may cause our performance to be worse than that of other fully invested BDCs or other lenders or investors pursuing comparable investment strategies. We cannot assure you that we will be able to identify any new investments that meet our investment objective or that any additional investment that we make will produce a positive return. We may be unable to invest the proceeds from investments or net proceeds of any follow-on offering on acceptable terms within the time period that we anticipate or at all, which could harm our financial condition and operating results.

We have restrictions on the type of assets we can invest in as a BDC

As a BDC, we may not acquire any assets other than certain qualifying assets described in the 1940 Act, unless, at the time of and after giving effect to the acquisition, at least 70% of our total assets consist of such qualifying assets. Thus, in certain instances, we may be precluded from investing in potentially attractive investments that are not qualifying assets for purposes of the 1940 Act. In addition, there is a risk that this restriction could prevent us from making additional investments in any non-qualifying investments we may acquire, which could cause our position to be diluted or limit our access to capital of non-qualifying investments.

The investments in which we invest are generally traded over-the-counter, if at all, and may experience limited liquidity

Our investments may experience periods with limited or no liquidity. The absence of liquidity may make it difficult for us to ascertain a market value for our investments, may limit or preclude our ability to exit underperforming investments, and may negatively impact the ability for issuers of Senior Secured Floating Rate Loans to refinance. As a result, periods of heightened illiquidity may adversely impact the performance of our portfolio and could persist for prolonged periods.

Because we generally do not hold controlling interests in the Senior Secured Floating Rate Loans or the issuers of Senior Secured Floating Rate Loans in which we invest, we may not be in a position to exercise control over issuers or to prevent decisions by management teams at issuers that could decrease the value of our investments

We generally do not hold equity positions or controlling interests in the issuers of Senior Secured Floating Rate Loans in which we invest. As a result, we are subject to the risk that an issuer of Senior Secured Floating Rate Loans may make business decisions with which we disagree, and that the management and/or stockholders of an issuer may take risks or otherwise act in ways that will be adverse to our interests.

An investment strategy focused primarily on privately held companies presents certain challenges, including the lack of available information about these companies, a dependence on the talents and efforts of only a few key portfolio company personnel and a greater vulnerability to economic downturns

We invest primarily in privately held companies. Generally, little public information exists about these companies, and we are required to rely on the ability of our Manager to obtain adequate information to evaluate the potential returns from investing in these companies. If we are unable to uncover all material information about these companies, we may not make a fully informed investment decision, and we may lose money on our investments. Also, privately held companies frequently have less diverse product or service lines and smaller market presence than larger competitors. These factors could adversely affect our investment returns as compared to companies investing primarily in the securities of public companies.

We intend to continue to finance our investments with borrowed money, and may securitize our investments in the future, which magnifies the potential for gain or loss on amounts invested and may increase the risk of investing in us

The use of leverage, including through the issuance of senior securities, magnifies the potential for gain or loss on amounts invested. The use of leverage is generally considered a speculative investment technique and increases the risks associated with investing in our securities. Our lenders will have fixed dollar claims on our assets that are superior to the claims of our common stockholders, and we would expect such holders to seek recovery against our assets in the event of a default. We may pledge up to 100% of our assets and may grant a security interest in all of our assets under the terms of any debt instruments into which we may enter. In addition, under the terms of any credit facility or other debt instrument we enter into, we may be required by its terms to use the net proceeds of investments that we sell to repay a portion of the amount borrowed under such facility or instrument before applying such net proceeds to any other uses.

If the value of our assets decreases, leverage would cause NAV to decline more sharply than it otherwise would have had we not leveraged, thereby magnifying losses. Similarly, any decrease in our revenue or income will cause our net income to decline more sharply than it would have had we not borrowed. Such a decline would also negatively affect our ability to make distributions on our common stock. Our ability to service our debt will depend largely on our financial performance and will be subject to

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prevailing economic conditions and competitive pressures. In addition, our common stockholders will bear the burden of any increase in our expenses as a result of our use of leverage, including interest expense and any increase in the management fee.

The following table illustrates the effect on returns to a holder of our common stock from the leverage created by our use of borrowing, at the weighted average cost of funding of 2.40% as of June 30, 2015 together with (a) our total value of net assets as of June 30, 2015; (b) approximately $124 million in aggregate principal amount of indebtedness outstanding as of June 30, 2015; and (c) hypothetical annual returns on our portfolio of minus 10% to plus 10%. As illustrated below, leverage generally increases the return to shareholders when the portfolio return is positive and decreases the return when the portfolio return is negative. Actual returns may be greater or less than those appearing in the table.

Assumed Return on Portfolio (Net of Expenses) (1)	(10)%	(5)%	—%	5%	10%
Corresponding Return to Stockholders (2)	(21)%	(12)%	(2)%	8%	17%

(1) The assumed portfolio return is required by SEC regulations and is not a prediction of, and does not represent, our projected or actual performance. Actual returns may be greater or less than those appearing in the table.

(2) In order to compute the “Corresponding Return to Shareholders,” the “Assumed Return on Portfolio” is multiplied by the total value of our assets at June 30, 2015 to obtain an assumed return to us. From this amount, estimated annual interest expense, based on the amount of debt outstanding at June 30, 2015, is subtracted to determine the return available to shareholders. The return available to shareholders is then divided by the total value of our net assets as of June 30, 2015 to determine the “Corresponding Return to Shareholders”.

In order for us to cover our annual interest payments on our outstanding indebtedness at June 30, 2015, we must achieve annual returns on our June 30, 2015 total assets of at least 1.1%.

As a BDC, we generally are required to meet a coverage ratio of total assets to total borrowings and other senior securities, which include all of our borrowings and any preferred stock that we may issue in the future, of at least 200%. If this ratio declines below 200%, we cannot incur additional debt and could be required to sell a portion of our investments to repay some debt when it is disadvantageous to do so. This could have a material adverse effect on our operations, and we may not be able to make distributions. The amount of leverage that we employ will depend on our Manager’s and our Board of Directors’ assessment of market and other factors at the time of any proposed borrowing. We cannot assure you that we will be able to obtain credit at all or on terms acceptable to us.

Our portfolio companies may be highly leveraged with debt

The debt levels of our portfolio companies may have significant adverse consequences to such companies and to us as an investor. Portfolio companies that are indebted may be subject to restrictive financial and operating covenants. The leverage may impair these companies’ ability to finance their future operations and capital needs. As a result, their flexibility to respond to changing business and economic conditions and to business opportunities may be limited. A company’s income and net worth will tend to increase or decrease at a greater rate than if the company did not capitalize itself in part with debt.

Our portfolio companies may incur debt that ranks equally with, or senior to, some of our investments in such companies

Our portfolio companies typically may be permitted to incur other debt that ranks equally with, or senior to, some of such debt instruments, including unitranche, second lien, middle market loans and unsecured debt instruments. By their terms, such debt instruments may provide that the holders are entitled to receive payment of interest or principal on or before the dates on which we will be entitled to receive payments in respect of the debt securities in which we will invest. Also, in the event of insolvency, liquidation, dissolution, reorganization or bankruptcy of a portfolio company, holders of debt instruments ranking senior to our investment in that portfolio company would typically be entitled to receive payment in full before we receive any distribution in respect of our investment. In such cases, after repaying such senior creditors, such portfolio company may not have any remaining assets to use for repaying its obligation to us. In the case of debt ranking equally with debt securities in which we will invest, we would have to share on an equal basis any distributions with other creditors holding such debt in the event of an insolvency, liquidation, dissolution, reorganization or bankruptcy of the relevant portfolio company.

Our borrowers may default on their payments, which may have a materially negative effect on our financial performance

Our primary business exposes us to credit risk, and the quality of our portfolio has a significant impact on our earnings. Credit risk is a component of our fair valuation of our portfolio companies. Negative credit events will lead to a decrease in the fair value of our portfolio companies and may potentially disrupt or impact the ability to pay amounts due to us thereby resulting in a decline in our earnings and NAV.

In addition, market conditions can affect consumer confidence levels, which may harm the business of our portfolio companies and result in adverse changes in payment patterns. Additionally, if interest rates rise, some of our portfolio companies may not be able to pay the escalating interest on our loans and may default. Deterioration in the credit quality of our portfolio could have a material adverse effect on our business, financial condition and results of operations. Increased delinquencies and default rates would negatively impact our results of operations.

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A general economic downturn or severe tightening in the credit markets could materially impact the ability of our borrowers to repay their loans, which could have a significant negative affect on us. Numerous other factors may affect a borrower’s ability to repay its loan, including the failure to meet its business plan or a downturn in its industry. A portfolio company’s failure to satisfy financial or operating covenants imposed by us or other lenders could lead to defaults and, potentially, termination of its loans or foreclosure on the secured assets. This could trigger cross-defaults under other agreements and jeopardize a portfolio company’s ability to meet its obligations under the loans or debt securities that we hold. In addition, our portfolio companies may have, or may be permitted to incur, other debt that ranks senior to or equally with our securities. This means that payments on such senior-ranking securities may have to be made before we receive any payments on our subordinated loans or debt securities. Deterioration in a borrower’s financial condition and prospects may be accompanied by deterioration in any related collateral and may have a material adverse effect on our financial condition and results of operations.

Certain of the issuers of Senior Secured Floating Rate Loans in which we invest may enter into bankruptcy proceedings

Senior Secured Floating Rate Loan issuers may experience bankruptcy or similar financial distress. The bankruptcy process has a number of significant inherent risks. Many events in a bankruptcy proceeding are the product of contested matters and adversary proceedings and are beyond the control of the creditors. A bankruptcy filing by an issuer may adversely and permanently affect the issuer. If the proceeding is converted to a liquidation, the value of the issuer may be significantly less than the liquidation value that was believed to exist at the time of the investment. The duration of a bankruptcy proceeding is also difficult to predict, and a creditor’s return on investment can be adversely affected by delays until the plan of reorganization or liquidation ultimately becomes effective. The administrative costs of a bankruptcy proceeding are frequently high and would be paid out of the debtor’s estate prior to any return to creditors. Because the standards for classification of claims under bankruptcy law are vague, our influence with respect to the class of securities or other obligations we own may be lost by increases in the number and amount of claims in the same class or by different classification and treatment. In the early stages of the bankruptcy process, it is often difficult to estimate the extent of, or even to identify, any contingent claims that might be made. In addition, certain claims that have priority by law (for example, claims for taxes) may be substantial.

Our investments in Senior Secured Floating Rate Loans involve risk and we could lose all or part of our investment

Investing in Senior Secured Floating Rate Loans involves a number of significant risks. Senior Secured Floating Rate Loans in which we invest may be issued by companies with limited financial resources and limited access to alternative financing. Issuers of Senior Secured Floating Rate Loans may be unable to meet their obligations under their debt securities that we hold. Such developments may be accompanied by deterioration in the value of collateral backing our investments. This could lead to a decline in value of our portfolio, which could result in a decline in our net earnings and NAV.

Second priority liens on collateral securing loans in which we invest may be subject to control by senior creditors with first priority liens. If there is a default, the value of the collateral may not be sufficient to repay in full both the first priority creditors and us

Some loans in which we invest may be secured on a second priority basis by the same collateral securing first priority debt of our portfolio companies. The first priority liens on the collateral will secure the portfolio company’s obligations under any outstanding senior debt and may secure certain other future debt that may be permitted to be incurred by the company under the agreements governing the loans. The holders of obligations secured by the first priority liens on the collateral will generally control the liquidation of and be entitled to receive proceeds from any realization of the collateral to repay their obligations in full before us. In addition, the value of the collateral in the event of liquidation will depend on market and economic conditions, the availability of buyers and other factors. There can be no assurance that the proceeds, if any, from the sale or sales of all of the collateral would be sufficient to satisfy the loan obligations secured by the second priority liens after payment in full of all obligations secured by the first priority liens on the collateral. If such proceeds are not sufficient to repay amounts outstanding under the loan obligations secured by the second priority liens, then we, to the extent not repaid from the proceeds of the sale of the collateral, will only have an unsecured claim against the company’s remaining assets, if any. The rights we may have with respect to the collateral securing the loans we may make to portfolio companies with senior debt outstanding may also be limited pursuant to the terms of one or more intercreditor agreements that we enter into with the holders of senior debt. Under such an intercreditor agreement, at any time that obligations that have the benefit of the first priority liens are outstanding, any of the following actions that may be taken with respect to the collateral will be at the direction of the holders of the obligations secured by the first priority liens: the ability to cause the commencement of enforcement proceedings against the collateral; the ability to control the conduct of such proceedings; the approval of amendments to collateral documents; releases of liens on the collateral; and waivers of past defaults under collateral documents. We may not have the ability to control or direct such actions, even if our rights are adversely affected.

Investments in non-investment grade CLO securities may be illiquid, may have a higher risk of default, and may not produce current returns

Our investments in CLO securities are generally non-investment grade. Non-investment grade CLO securities tend to be illiquid, have a higher risk of default and may be more difficult to value than investment grade bonds. Recessions or poor economic or pricing conditions in the markets associated with CLO securities may cause higher defaults or losses than expected. Non-

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investment grade securities are considered speculative, and their capacity to pay principal and interest in accordance with the terms of their issue is not certain.

We invest in equity securities of CLOs, and may invest in debt securities of CLOs, collateralized primarily by Loans. Accordingly, such securities involve the same risks associated with investing in Senior Secured Floating Rate Loans on a levered basis, including credit risk and market risk. Changes in a variety of factors, including interest rates, defaults, interest rate spreads, interest rate curves, investor perception of macroeconomic risks and market outlook, and demand for debt securities issued by CLOs may cause the cash flows provided by and the market prices for CLO securities to fluctuate significantly. CLOs are typically privately offered and sold and CLO securities may be thinly traded or have a limited trading market.

Some of our investments in CLOs may be in newly issued CLOs. Generally, new-issue CLOs make their initial distribution to underlying debt and equity tranches six to nine months after closing, and subsequent payments are generally made on a quarterly basis. Additionally, equity securities of CLOs do not have a stated coupon and only have claims to residual cash flows after payments to securities ranked senior to equity securities have been made. Changes in a variety of factors, including interest rates, defaults, interest rate spreads, interest rate curves and performance of collateral underlying CLO securities may cause the cash flows generated by our investments in the debt and equity tranches of CLOs to fluctuate significantly, and in certain instances may be shut off all together either temporarily or permanently. Therefore, the cash flows and earnings we receive from our CLO investments may fluctuate significantly.

We invest in CLO securities that are subordinate in right of payment to more senior securities

CLO equity securities are the first to bear losses resulting from defaults and losses from underlying collateral. As a result, investments in CLO equity securities carry significant risks, including, but not limited to the possibility that distributions from CLO equity securities may decline or cease altogether should the quality of the collateral deteriorate, decline in value or default. Therefore, we may fail to achieve our expected investment returns from CLO equity securities.

Our investments in CLO securities may be riskier and less transparent to us and our stockholders than direct investments in the underlying companies

We invest in equity tranches and may invest in debt tranches of CLOs. Generally, there will be less information available to us regarding the underlying investments held by such CLO vehicles than if we had invested directly in the underlying companies. As a result, our stockholders will not know the details of the underlying securities of the CLO vehicles in which we invest. Our CLO investments are subject to the risk of leverage associated with the debt issued by such CLOs and the repayment priority of senior debt holders in such CLO vehicles. The accounting and tax implications of such investments are complicated. In particular, reported revenue from the equity tranche investments of these CLO vehicles are recorded each quarter in accordance with GAAP under the effective interest rate method based on the future projected cash flows. Our current taxable earnings on these investments, however, will depend upon the ownership of the CLO equity tranche as well as for certain CLOs any election we make to mark-to-market our taxable income. Our current taxable income will generally not be determinable until after the end of the fiscal year of each individual CLO vehicle that ends within our fiscal year and may be materially different from both the cash distributions we receive and revenue we record in accordance with GAAP. We may be required to record current taxable income based on our proportionate share of the ordinary earnings and net capital gain of the CLO vehicle or based on changes to fair value if we elect mark-to-market treatment for certain eligible CLO investments, even if such income is not distributed to us by the CLO vehicle. As a result, the reported revenue to our stockholders under GAAP from investments in these CLO vehicles may not be reflective of the taxable income we record for such investments, and the current cash flow we receive from these CLO investments may be less than the current taxable income we record from these investments that we are required to distribute to our stockholders.

CLOs typically will have no significant assets other than their underlying Senior Secured Floating Rate Loans

CLOs typically will have no significant assets other than their underlying Senior Secured Floating Rate Loans. Accordingly, payments on CLO investments are and will be payable solely from the cash flows from such Loans, net of all management fees and other expenses. Payments to us as a holder of CLO junior securities are and will be made only after payments due on the senior securities. It may adversely impact our returns if the cash flows from the Loans are insufficient to repay our CLO investments.

There is the potential for interruption and deferral of cash flow from CLO investments

If certain minimum collateral coverage ratios and/or interest coverage ratios are not met by a CLO, then cash flows that otherwise would have been available to pay distributions to us on our CLO investments may instead be used to redeem any senior notes or to purchase additional Loans, until the ratios again exceed the minimum required levels or any senior notes are repaid in full. This could result in a reduction in the distribution and/or principal paid to the holders of the CLO investments, which would adversely impact our returns.

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Senior Secured Floating Rate Loans that are collateral of our CLO investments are subject to prepayments and calls, increasing re-investment risk, and the inability of a CLO collateral manager to reinvest the proceeds of the prepayment of its loan collateral may adversely affect us

The underlying Loans of our CLO investments may be prepaid more quickly than expected, which could have an adverse impact on the value of our CLO investment. Prepayment rates are influenced by changes in interest rates and a variety of economic, geographic and other factors beyond our control, and consequently cannot be predicted with certainty. There can be no assurance that for any CLO investment, in the event that any of the Loans of a CLO underlying such investment are prepaid, the CLO collateral manager will be able to reinvest such proceeds in new Loans with equivalent investment returns. If the CLO collateral manager cannot reinvest in new Loans with equivalent investment returns, the proceeds available to pay interest, principal or other distributions to the CLO securities may be adversely affected.

We may not have the ability to control the timing of a call position on our CLO investments

Our CLO investments generally contain optional call provisions, exercisable at the discretion of the holders of the equity tranches, after the expiration of an initial period in the deal (referred to as the “non-call period”) which provide for the senior notes and the junior secured notes to be paid in full. The exercise of the call option is by the relevant percentage (usually a majority) of the holders of the equity tranche. Therefore, where we do not hold the relevant percentage, we will not be able to control the timing of the exercise of the call option. The equity tranche also generally has a call at any time based on certain tax event triggers. In any event, the call can only be exercised by the holders of the equity tranche if they can demonstrate (in accordance with the detailed provisions in the transaction) that the senior notes and junior secured notes will be paid in full if the call is exercised.

We have limited control of the administration and amendment of Loans owned by the CLOs in which we invest

We will not be able to directly enforce any rights and remedies in the event of a default of a Loan held by a CLO vehicle. In addition, the terms and conditions of the Loans underlying our CLO investments may be amended, modified or waived only by the agreement of the underlying lenders. Generally, any such agreement must include a majority or a super majority (measured by outstanding loans or commitments) or, in certain circumstances, a unanimous vote of the lenders. Consequently, the terms and conditions of the payment obligations arising from Loans could be modified, amended or waived in a manner contrary to our preferences.

We have limited control of the administration and amendment of any CLO in which we invest

The terms and conditions of CLOs may be amended, modified or waived only by the agreement of the underlying security holders. Generally, any such agreement must include a majority or a super majority (measured by outstanding amounts) or, in certain circumstances, a unanimous vote of the security holders. Consequently, the terms and conditions of the payment obligation arising from the CLOs in which we invest may be modified, amended or waived in a manner contrary to our preferences.

We will have no influence on management of underlying investments managed by non-affiliated third-party CLO collateral managers

We are not responsible for and have no influence over the asset management of the portfolios underlying the CLO investments we hold as those portfolios are managed by non-affiliated third-party CLO collateral managers. Similarly, we are not responsible for and have no influence over the day-to-day management, administration or any other aspect of the issuers of the individual securities. As a result, the performance and values of the portfolios underlying our CLO investments could decrease as a result of decisions made by third-party CLO collateral managers.

Engaging in hedging transactions may expose us to additional risks

We may enter into interest rate or currency hedges. Hedging against interest rate and currency fluctuations may expose us to additional risks and could harm our financial performance. Our use of hedging would not eliminate the risk that the value of our investments could decline or that our investment performance would be better off if we did not hedge. The effectiveness of our hedging is dependent on the price we pay for the hedge and the correlation of the hedge to the risk it is designed to mitigate. It may arise that the cost of a hedging instrument exceeds its expected benefits or that an instrument may not hedge all of the risk for which it was designed to mitigate. Additionally, the use of hedging instruments exposes us to counterparty risk including the failure to perform under the contract such as nonpayment.

Risks Related to Our Common Stock

Investing in our common stock may involve an above average degree of risk

The investments we make in accordance with our investment objective may result in a higher amount of risk than alternative investment options and a higher risk of volatility or loss of principal. Our investments in portfolio companies involve higher levels of risk, and therefore, an investment in our common stock may not be suitable for someone with lower risk tolerance.

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There is a risk that our stockholders may not receive distributions or that our distributions may not grow over time, and a portion of our distributions may be a return of capital

We intend to make distributions on a quarterly basis to our stockholders out of assets legally available for distribution. We cannot assure you that we will achieve investment results that will allow us to make a specified level of cash distributions or year-to-year increases in cash distributions. In addition, due to the asset coverage test applicable to us as a BDC, we may be limited in our ability to make distributions.

The market price of our common stock may fluctuate significantly

The market price and marketability of shares of our common stock may from time to time be significantly affected by numerous factors, including many over which we have no control and that may not be directly related to us. These factors include the following:

• price and volume fluctuations in the stock market from time to time, which are often unrelated to the operating performance of particular companies;

• significant volatility in the market price and trading volume of securities of BDCs, financial service companies, asset managers or other companies in our sector, which is not necessarily related to the operating performance of particular companies;

• changes in laws, regulatory policies, tax guidelines or financial accounting standards, particularly with respect to BDCs or RICs;

• not qualifying as a RIC, or the loss of RIC status;

• changes in our earnings or variations in operating results;

• any shortfall in revenue or net income or any increase in losses from levels expected by securities analysts and the market in general;

• decreases in our NAV per share;

• general economic trends and other external factors; and

• loss of a major funding source.

Fluctuations in the trading price of our common stock may adversely affect the liquidity of the trading market for our common stock and, in the event that we seek to raise capital through future equity financings, our ability to raise such equity capital.

Our shares of common stock may trade at a substantial discount from NAV and may continue to do so over the long term

Our shares of common stock may trade at a market price that is less than the NAV that is attributable to those shares. The possibility that our shares of common stock will trade at a substantial discount from NAV over the long term is separate and distinct from the risk that our NAV will decrease. We cannot predict whether shares of our common stock will trade above, at or below our NAV. If our common stock trades below its NAV, we will generally not be able to issue additional shares or sell our common stock at its market price without first obtaining the approval for such issuance from our stockholders and our independent directors. If additional funds are not available to us, we could be forced to curtail or cease our new lending and investment activities, and our NAV could decrease and our level of distributions could be impacted.

Our common stock may be difficult to resell

Investors may not be able to resell shares of our common stock at or above their purchase prices due to a number of factors, including:

• actual or anticipated fluctuation in our operating results;

• volatility in our common stock price;

• changes in expectations as to our future financial performance or changes in financial estimates of securities analysts; and

• departures of key personnel.

Certain provisions in our charter and bylaws could discourage a change of control that our stockholders may favor, which could also adversely affect the market price of our common stock

Provisions in our charter and bylaws may make it more difficult and expensive for a third-party to acquire control of us, even if a change of control would be beneficial to our stockholders. For example, our charter authorizes our Board of Directors

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to issue up to 50,000,000 shares of preferred stock in one or more classes or series and to fix the rights, preferences, privileges and restrictions of unissued classes or series of preferred stock, each without any vote or action by our stockholders. We could issue a class or series of preferred stock to impede the completion of a merger, tender offer or other takeover attempt. These and other provisions in our charter and bylaws may impede takeover attempts, or other transactions, that may be in the best interests of our stockholders and, in particular, our common stockholders. In addition, the market price of our common stock could be adversely affected to the extent that provisions of our charter and bylaws discourage potential takeover attempts, or other transactions, that our stockholders may favor.

Certain provisions of Maryland law may limit the ability of a third-party to acquire control of our company

Certain provisions of the Maryland General Corporation Law (the “MGCL”) may have the effect of delaying, deferring or preventing a transaction or a change of control of our company that might involve a premium price for holders of our common stock or otherwise be in their best interests.

Subject to certain limitations, provisions of the MGCL prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our outstanding voting stock or an affiliate or associate of ours who beneficially owned 10% or more of the voting power of our then outstanding stock during the two-year period immediately prior to the date in question) or an affiliate of the interested stockholder for five years after the most recent date on which the stockholder became an interested stockholder. After the five-year period, business combinations between us and an interested stockholder or an affiliate of the interested stockholder must generally either provide a minimum price to our stockholders (as defined in the MGCL) in the form of cash or other consideration in the same form as previously paid by the interested stockholder or be recommended by our Board of Directors and approved by the affirmative vote of at least 80% of the votes entitled to be cast by holders of our outstanding shares of voting stock and at least two-thirds of the votes entitled to be cast by stockholders other than the interested stockholder and its affiliates and associates. These provisions of the MGCL relating to business combinations do not apply, however, to business combinations that are approved or exempted by our Board of Directors prior to the time that the interested stockholder becomes an interested stockholder. Pursuant to the statute, our Board of Directors has, by resolution, exempted business combinations between us and American Capital and its affiliates, and between us and any other person, provided that in the latter case the business combination is first approved by our Board of Directors (including a majority of our directors who are not affiliates or associates of such person). However, our Board of Directors may repeal or modify this resolution at any time in the future, in which case the applicable provisions of this statute will become applicable to business combinations between us and interested stockholders.

The “control share” provisions of the MGCL provide that holders of “control shares” of a Maryland corporation (defined as shares which, when aggregated with other shares controlled by the stockholder (except solely by virtue of a revocable proxy), entitle the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of “control shares”) have no voting rights with respect to such shares except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding votes entitled to be cast by the acquiror of control shares, our officers and our employees who are also our directors. Our bylaws contain a provision exempting from the control share acquisition statute any and all acquisitions by any person of shares of our stock. There can be no assurance that this provision will not be amended or eliminated at any time in the future. However, so long as we are a BDC, we will amend our bylaws to be subject to the control share acquisition statute only if our Board of Directors determines that it would be in our best interests based on our determination that our being subject to the control share acquisition statute does not conflict with the 1940 Act.

Additionally, Title 3, Subtitle 8 of the MGCL permits our Board of Directors, without stockholder approval and regardless of what is currently provided in our charter or bylaws, to elect to be subject to certain provisions relating to corporate governance that may have the effect of delaying, deferring or preventing a transaction or a change of control of our company that might involve a premium to the market price of our common stock or otherwise be in our stockholders’ best interests. Upon the consummation of this offering, we will already be subject to some of these provisions, either by provisions of our charter and bylaws unrelated to Subtitle 8 or by reason of an election in our charter to be subject to certain provisions of Subtitle 8.

Our Board of Directors has the power to cause us to issue additional shares of our stock without stockholder approval

Our charter authorizes us to issue additional authorized but unissued shares of common or preferred stock. In addition, our Board of Directors may, without stockholder approval, amend our charter to increase the aggregate number of our shares of stock or the number of shares of stock of any class or series that we have authority to issue and classify or reclassify any unissued shares of common or preferred stock and set the preferences, rights and other terms of the classified or reclassified shares. As a result, our Board of Directors may establish a series of shares of common or preferred stock that could delay or prevent a transaction or a change in control that might involve a premium price for our shares of common stock or otherwise be in the best interest of our stockholders.

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Our common stockholders will bear the expenses associated with our borrowings, and the holders of our debt securities, if any, will have certain rights senior to our common stockholders

All of the costs of offering and servicing our debt, including interest thereon, will be borne by our common stockholders. The interests of the holders of any debt we may issue will not necessarily be aligned with the interests of our common stockholders. In particular, the rights of holders of our debt to receive interest or principal repayment will be senior to those of our common stockholders. In addition, we may grant a lender a security interest in a significant portion or all of our assets, even if the total amount we may borrow from such lender is less than the amount of such lender's security interest in our assets.

Our shares of common stock have a limited trading history and we cannot assure you that the market price of shares of our common stock will not decline

Our shares of common stock have a limited trading history and we cannot assure you that a public trading market will be sustained for such shares. We cannot predict the prices at which our common stock will trade. We cannot assure you that the market price of shares of our common stock will not decline at any time. In addition, if our common stock trades below our NAV per share, we will generally not be able to sell additional shares of our common stock to the public at the market price without first obtaining the approval of our stockholders (including our unaffiliated stockholders) and our independent directors for such issuance.

Our stockholders could experience dilution in their ownership percentage if they do not participate in our dividend reinvestment plan

All dividends declared in cash payable to stockholders that are participants in our dividend reinvestment plan are reinvested in shares of our common stock. As a result, our stockholders that do not participate in our dividend reinvestment plan could experience dilution in their ownership percentage of our common stock over time if we issue additional shares of our common stock as part of the dividend reinvestment plan.

You may have current tax liabilities on distributions that are reinvested in our common stock

Under the dividend reinvestment plan, if you own shares of our common stock, you will have all cash distributions automatically reinvested in additional shares of our common stock unless you, or your nominee on your behalf, specifically “opt out” of the dividend reinvestment plan by delivering a written notice to the plan administrator prior to the record date of the next dividend or distribution. If you have not “opted out” of the dividend reinvestment plan, you will be deemed to have received, and for federal income tax purposes will be taxed on, the amount reinvested in our common stock to the extent the amount reinvested was not a tax-free return of capital. As a result, you may have to use funds from other sources to pay your federal income tax liability on the value of the common stock received. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition, Liquidity and Capital Resources” for more information.

We may in the future choose to pay distributions partly in our own stock, in which case you may be required to pay tax in excess of the cash you receive

We may make taxable distributions that are payable in part in our stock. The Internal Revenue Service (the “IRS”) has issued private letter rulings to other RIC taxpayers in the past that allowed the RIC taxpayer to treat a distribution of its own stock as fulfilling its RIC annual distribution requirement under certain circumstances. In addition, the IRS has issued revenue procedures in the past that temporarily allowed a RIC to treat a distribution of its own stock as fulfilling its RIC annual distribution requirements under certain circumstances (although those periods to which those revenue procedures applied have expired). We may seek to obtain a similar private letter ruling from the IRS, or the IRS may issue revenue procedures in the future allowing RICs to treat a distribution of its own stock as fulfilling its RIC annual distribution requirements. As a result, a stockholder may be required to pay tax with respect to such distributions in excess of any cash received.

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USE OF PROCEEDS

Unless otherwise specified in a prospectus supplement, we intend to use the net proceeds from the sale of our Securities for general corporate purposes, which may include investing in portfolio companies in accordance with our investment objective and strategies, to reduce a portion of our outstanding borrowings under the Credit Facility and for general working capital purposes. We anticipate we will use substantially all of the net proceeds of any offering of our Securities within approximately six months after the completion of such offering, depending on the availability of appropriate investment opportunities and market conditions. We cannot assure you that we will achieve our targeted investment pace.

PRICE RANGE OF COMMON STOCK AND DISTRIBUTIONS

Our common stock is quoted on The NASDAQ Global Select Market under the ticker symbol “ACSF.” As of October 30, 2015, we had four stockholders of record. Most of the shares of our common stock are held by brokers and other institutions on behalf of stockholders. We believe that there are approximately 5,000 additional beneficial holders of our common stock.

The following table sets forth the range of high and low sales prices of our common stock as reported on The NASDAQ Global Select Market and dividends declared on our common stock since our IPO. Our common stock has historically traded below NAV per share. On March 19, 2015, we announced that our Board of Directors approved a change to the common stock dividend schedule so that distributions are made monthly rather than quarterly.

		Closing Sales Price		Premium (Discount) of High Sales Price to NAV (2) per Share	Premium (Discount) of Low Sales Price to NAV (2) per Share	Distributions Declared
Period	NAV (1)	High	Low
Fiscal year ending December 31, 2015
Fourth quarter (through November 2, 2015)	N/A	$11.72	$10.88	N/A	N/A	$0.291
Third quarter	N/A	$13.20	$10.91	N/A	N/A	$0.291
Second quarter	$14.54	$13.45	$12.92	(7.5)%	(13.0)%	$0.291
First quarter	$14.51	$13.49	$12.11	(7.0)%	(16.5)%	$0.290
Fiscal year ended December 31, 2014
Fourth quarter	$14.42	$13.44	$12.11	(6.8)%	(16.0)%	$0.290
Third quarter	$14.85	$14.12	$13.01	(4.9)%	(12.4)%	$0.280
Second quarter	$15.12	$14.25	$13.25	(5.8)%	(12.4)%	$0.280
First quarter (3)	$15.11	$14.70	$13.38	(2.7)%	(11.4)%	$0.180

(1) NAV per share is determined as of the last day in the relevant quarter and therefore may not reflect the NAV per share on the date of the high and low sales prices. The NAVs shown are based on the outstanding common shares at the end of each period. Third and fourth quarter NAV for the fiscal year ending 2015 was not final as of the filing date.

(2) Calculated as of the respective high or low closing sales price divided by the quarter-end NAV.

(3) The high and low price, as reported, reflects the time period from January 16, 2014 through March 31, 2014 and does not consider the initial public offering price of $15.00 per share.

To the extent that we have taxable income available, we intend to continue to distribute monthly dividends to our stockholders. The amount of our dividends, if any, will be determined by our Board of Directors. Any dividends to our stockholders will be declared out of assets legally available for distribution. We anticipate that our dividends will be paid from taxable earnings, including interest and capital gains generated by our investment portfolio. However, if we do not generate sufficient taxable earnings during any fiscal year, a portion of our dividends for such year may constitute a return of capital. As a result, stockholders should not assume that all periodic dividends are paid from taxable earnings. The specific tax characteristics of our dividends will be reported to stockholders after the end of each calendar year.

We intend to elect to be taxed as a RIC under Subchapter M of the Code. In order to qualify as a RIC, we must distribute at least 90% of our ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, if any, out of the assets legally available for distribution. In addition, although we currently intend to distribute realized net capital gains (i.e., net long-term capital gains in excess of short-term capital losses), if any, at least annually, out of the assets legally available for such distributions, we may in the future decide to retain such capital gains for investment.

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We may not be able to achieve operating results that will allow us to make dividends and distributions at a specific level or to increase the amount of these dividends and distributions from time to time. In addition, we may be limited in our ability to make dividends and distributions due to the asset coverage test for borrowings when applicable to us as a BDC under the 1940 Act and due to provisions in future credit facilities or other financing alternatives. If we do not distribute a certain percentage of our income annually, we will suffer adverse tax consequences, including possible loss of our RIC status. We cannot assure stockholders that they will receive any dividends and distributions or dividends and distributions at a particular level.

All dividends declared in cash payable to stockholders that are participants in our dividend reinvestment and stock purchase plan are generally automatically reinvested in shares of our common stock. As a result, stockholders that opt out of our dividend reinvestment and stock purchase plan may experience dilution over time.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The information contained in this section should be read in conjunction with our financial statements and notes thereto appearing elsewhere in this report.

Forward-Looking Statements

Some of the statements in this report constitute forward-looking statements, which relate to future events or our future performance or financial condition. We generally use words such as “anticipates,” “believes,” “expects,” “intends” and similar expressions to identify forward-looking statements. Our actual results could differ materially from those projected in the forward-looking statements for any reason, including any factors set forth in “Risk Factors” and elsewhere in this report. The forward-looking statements contained herein involve risks and uncertainties, including statements as to: (i) our future operating results; (ii) our business prospects and the prospects of our portfolio companies; (iii) the impact of investments that we expect to make; (iv) our contractual arrangements and relationships with third-parties; (v) the dependence of our future success on the general economy and its impact on the industries in which we invest; (vi) the ability of our portfolio companies to achieve their objectives; (vii) our expected financings and investments; (viii) the adequacy of our cash resources and working capital; and (ix) the timing of cash flows, if any, from the operations of our portfolio companies.

We have based the forward-looking statements included in this report on information available to us on the date of this report, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we may file with the SEC in the future, including any annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K.

Overview

American Capital Senior Floating, Ltd. ("ACSF", "we", "our" and "us"), a Maryland corporation organized in February 2013 that commenced operations on October 15, 2013, is an externally managed, non-diversified closed-end investment management company. We have elected to be treated as a business development company ("BDC") under the Investment Company Act of 1940 (the "1940 Act"). In addition, for tax purposes we intend to elect to be treated as a regulated investment company ("RIC") under Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code").

On January 15, 2014, we priced our initial public offering ("IPO"), selling 10.0 million shares of common stock, at a price of $15.00 per share for net proceeds of $149.2 million. Our common stock is listed on the NASDAQ Global Select Market, where it trades under the symbol “ACSF”. We are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act of 2012 ("JOBS Act"), and intend to take advantage of the exemption for emerging growth companies allowing us to temporarily forgo the auditor attestation requirements of Section 404(b) of the Sarbanes-Oxley Act of 2002. We do not intend to take advantage of other disclosure or reporting exemptions for emerging growth companies under the JOBS Act.

Our investment activities are managed by American Capital ACSF Management, LLC (our "Manager"). Under our management agreement with our Manager, we have agreed to pay our Manager an annual base management fee of 0.80% of our total consolidated assets, excluding cash and cash equivalents and net unrealized appreciation or depreciation, at the end of the most recently completed fiscal quarter. There is no incentive compensation paid to our Manager. For the first two years following

the IPO, our Manager has agreed that annual other operating expenses, as defined in our management agreement, will generally not exceed 75 basis points of ACSF’s quarter end consolidated net assets, excluding unrealized gains or losses. Our Board of Directors, a majority of whom are independent of us, provides overall supervision of our activities, and our Manager supervises our day-to-day activities.

On November 14, 2013, we formed a wholly-owned consolidated financing subsidiary, ACSF Funding I, LLC, a Delaware limited liability company (“ACSF Funding”). On December 18, 2013, ACSF Funding entered into a two-year $140 million secured revolving credit facility with Bank of America, N.A., as agent (the “Credit Facility”). The Credit Facility is scheduled to mature on December 18, 2015 and generally bears interest at the London Interbank Offered Rate ("LIBOR") plus 1.80%. The Credit Facility is secured by ACSF Funding's assets pursuant to a security agreement and contains customary financial and negative covenants and events of default. Advance rates vary on the type of collateral owned and can range up to 80%.

On October 15, 2013, we entered into a $200 million revolving credit facility (the "ACAM Facility") provided by American Capital Asset Management, LLC, the indirect parent of our Manager. Prior to the IPO, we used the ACAM Facility to purchase our initial investment portfolio and upon the closing of the IPO, we repaid the ACAM Facility in full plus accrued interest and terminated the ACAM Facility.

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Investments    

Our investment objective is to provide attractive, risk-adjusted returns over the long term primarily through current income while seeking to preserve our capital. We actively manage a leveraged portfolio composed primarily of diversified investments in first lien and second lien floating rate loans principally to large-market U.S.-based companies (collectively, "Senior Floating Rate Loans", "SFRLs" or "Loan Portfolio") which are commonly referred to as leveraged loans. Standard and Poor's ("S&P") defines large-market loans as loans to issuers with earnings before interest, taxes, depreciation and amortization ("EBITDA") of greater than $50 million. Senior Floating Rate Loans are typically collateralized by a company's assets and structured with first lien or second lien priority on collateral, providing for greater security and potential recovery in the event of default compared to other subordinated fixed-income products. We also invest in equity tranches of collateralized loan obligations ("CLOs") which are securitized vehicles collateralized primarily by SFRLs and we may invest in debt tranches of CLOs. In addition, we may selectively invest in loans issued by middle market companies, mezzanine and unitranche loans and high yield bonds. Additionally, we may from time to time hold or invest in other equity investments and other debt or equity securities generally arising from a restructuring of Senior Floating Rate Loan positions previously held by us. Under normal market conditions, we will invest at least 80% of our assets in Senior Floating Rate Loans or CLOs that are pooled investment vehicles that invest primarily all of their assets in Senior Floating Rate Loans.

Our level of investment activity can vary substantially from period to period depending on many factors, including the amount of debt and equity capital available to U.S. based large-market private companies, the level of merger and acquisition activity for such companies, the general economic environment and the competitive environment for the types of investments we make. As a BDC, we must not acquire any assets other than “qualifying assets” as defined by Section 55(a) of the 1940 Act unless, at the time the acquisition is made, at least 70% of our total assets are qualifying assets (with certain limited exceptions). Qualifying assets include investments in “eligible portfolio companies”. The definition of “eligible portfolio company” includes private operating companies and certain public companies whose securities are listed on a national securities exchange but whose market capitalization is less than $250 million, in each case organized under the laws of and with their principal place of business located in the United States. Investments in debt and equity tranches of CLOs are deemed nonqualified assets for BDC compliance purposes; therefore, under normal market conditions, we intend to limit our CLO investments to 20% of our portfolio.

Investment Income

We generate investment income primarily in the form of interest income from the investment securities we hold and capital gains, if any, on investment securities that we may sell. Our debt investments generally have a stated term of three to seven years and typically bear interest at a floating rate usually determined on the basis of a benchmark LIBOR, commercial paper rate, or the prime rate. Interest on our debt investments is generally payable quarterly but may be paid monthly or semi-annually.

Expenses

We do not have any employees and do not pay our officers any cash or non-cash equity compensation. We pay, or reimburse our Manager and its affiliates, for expenses related to our operations incurred on our behalf, excluding employment-related expenses of our and our Manager's officers and any employees of American Capital or the parent company of our Manager who provide services to us pursuant to the management agreement or to our Manager pursuant to the administrative services agreement. However, for the first full 24 months after the date of our IPO, our other operating expenses are limited to an annual rate of 0.75% of our consolidated net assets, less net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter (the "Expense Cap"). For the purposes of the Expense Cap, other operating expenses include both (i) our operating expenses reimbursed to our Manager and its affiliates for expenses related to our operations incurred on our behalf, and (ii) our operating expenses directly incurred by us excluding the management fee, interest costs, taxes and accrued costs and fees related to actual, pending or threatened litigation, each as determined under GAAP for the most recently completed fiscal quarter. Subsequent to the first full 24 months after the date of our IPO, there are no limits on the reimbursement to our Manager or its affiliates of such expenses related to our operations.

During periods of asset growth, we generally expect our general and administrative operating expenses to decline as a percentage of our total assets and increase during periods of asset declines. Interest expense and costs relating to future offerings of securities, among others, may also increase or reduce overall operating expenses based on portfolio performance, interest rate benchmarks, and offerings of our securities relative to comparative periods, among other factors.

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Current Market Conditions

Economic and market conditions can impact our business and our investments in multiple ways, including the financial condition of the portfolio companies in which we invest, our investment returns, our funding costs, our access to the capital markets and our access to credit. The leveraged loan market has grown substantially in recent years with the amount of total leveraged loans outstanding exceeding $800 billion as of June 30, 2015. Growth has largely been a function of the resilient performance of the asset class across multiple credit cycles coupled with the changing regulatory and investor landscape and the attractive floating rate nature of the assets. Despite the size and liquidity of the loan market, there continues to be volatility in the loan market as a result of (i) the dynamic correlation between retail fund flows, the rate of CLO issuance and amount of new issue supply and (ii) the financial performance of the underlying issuers that comprise the asset class. Despite uncertainties regarding economic and market conditions, the new issue loan pipeline in the leveraged loan market remains active, with high quality first lien and second lien transactions supporting leveraged buyouts, strategic acquisitions, plant expansions, recapitalizations and refinancings for large to mid-sized borrowers. Similarly, the CLO equity pipeline also remains very healthy with a backlog of managers raising capital for new investment vehicles.

The primary loan market volume during the first half of 2015 was less than the volume during the comparable period in 2014, driven largely by a drop in merger and acquisition and recapitalization activity. In addition, CLO formation was strong during the first half of 2015 at approximately $59 billion, while retail fund flows remained relatively flat for the period. These technical factors contributed to stable loan prices in the secondary market, with the average bid of the S&P/LSTA Leveraged Loan Index at 96.58 on June 30, 2015,down slightly from 96.98 on March 31, 2015, up from 95.92 on December 31, 2014 and down from 98.29 on December 31, 2013.

Portfolio and Investment Activity

As of June 30, 2015, our portfolio had a fair market value of $272.2 million, a cost basis of $277.7 million and was comprised of 70% first lien loans, 10% second lien loans and 20% CLO equity, measured at fair value. The Loan Portfolio consisted of 127 portfolio companies in 43 industries, and the CLO portfolio included 19 CLOs managed by 14 collateral managers with vintages ranging from 2012-2015. Our Loan Portfolio consisted of all floating rate investments with 100% having LIBOR floors ranging between 0.75% and 1.75%. The weighted average LIBOR floor in our Loan Portfolio was 1.02% as of June 30, 2015. The following table depicts a summary of the portfolio as of June 30, 2015:

($ in thousands)	Cost		Fair Market Value		Cumulative Net Unrealized Depreciation			Yield at Cost
Investment Portfolio:
First lien floating rate loans	$	192,480	$	190,427	$	(2,053	)	4.90	%
Second lien floating rate loans	28,681		27,914		(767		)	7.79	%
Total Senior Floating Rate Loans	221,161		218,341		(2,820		)	5.27	%
CLO equity	56,519		53,850		(2,669		)	14.69	%
Total Investment Portfolio	$	277,680	$	272,191	$	(5,489	)	7.19	%

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The portfolio is actively managed, with an annualized turnover ratio of 57.29% and 55.65%, respectively, for the three and six months ended June 30, 2015. During the three and six months ended June 30, 2015, Loan Portfolio rotation was reflective of the active management style, which seeks to optimize the portfolio based on current market conditions by rotating into positions that have better relative values. The average yield during the three months ended June 30, 2015 on the Loan Portfolio, CLO equity and total portfolio was 5.35%, 14.14% and 7.06%, respectively. The average yield during the six months ended June 30, 2015 on the Loan Portfolio, CLO equity and total portfolio was 5.35%, 13.89% and 6.99%, respectively. The following tables depict the portfolio activity for the three and six months ended June 30, 2015:

	Three months ended June 30, 2015												Six months ended June 30, 2015
($ in thousands)	First Lien			Second Lien			CLO Equity			Total			First Lien			Second Lien			CLO Equity			Total
Fair Value, Beginning	$	192,728		$	29,079		$	50,753		$	272,560		$	194,952		$	29,841		$	51,577		$	276,370
Purchases	34,685			—			4,219			38,904			64,386			2,492			8,206			75,084
Sales	(19,225		)	(500		)	—			(19,725		)	(50,340		)	(3,765		)	(2,283		)	(56,388		)
Repayments (1)	(17,172		)	(908		)	(3,283		)	(21,363		)	(19,697		)	(916		)	(6,527		)	(27,140		)
Non-cash income accrual (2)	11			3			1,873			1,887			18			6			3,582			3,606
Net realized gains / (losses)	81			(3		)	—			78			85			22			278			385
Net unrealized appreciation / (depreciation)	(681		)	243			288			(150		)	1,023			234			(983		)	274
Fair Value, Ending	$	190,427		$	27,914		$	53,850		$	272,191		$	190,427		$	27,914		$	53,850		$	272,191

(1) Repayments for CLO equity reflect the amount of cash distributions from CLO investments received during the three and six months ended June 30, 2015.

(2) Non-cash income accrual includes amortization/accretion of discount/premium on the Loan Portfolio and income accrued on the CLOs using the effective interest method during the three and six months ended June 30, 2015.

	Three months ended June 30, 2015			Six months ended June 30, 2015
	Loan Portfolio	CLO Equity	Total Portfolio	Loan Portfolio	CLO Equity	Total Portfolio
Portfolio Companies - Beginning	121	17	138	117	16	133
Purchases (new)	24	2	26	43	4	47
Purchases (add-on to existing)	6	—	6	8	—	8
Complete exit	(18)	—	(18)	(33)	(1)	(34)
Portfolio Companies - Ending	127	19	146	127	19	146

The following table depicts the weighted average portfolio yield by activity type during the three and six months ended June 30, 2015:

	Three months ended June 30, 2015								Six months ended June 30, 2015
	First Lien		Second Lien		CLO Equity		Total		First Lien		Second Lien		CLO Equity		Total
Beginning Yield	5.02	%	7.81	%	14.02	%	7.06	%	4.98	%	7.81	%	13.64	%	6.92	%
Purchases	4.71	%	—	%	16.87	%	5.75	%	5.00	%	9.25	%	16.99	%	6.16	%
Sales	(5.02	)%	(8.17	)%	—	%	(5.11	)%	(5.08	)%	(8.77	)%	(18.93	)%	(5.85	)%
Repayments	(5.77	)%	(8.32	)%	(14.04	)%	(7.17	)%	(5.69	)%	(8.30	)%	(13.84	)%	(7.76	)%
Repricing/Reforecast	(0.35	)%	—	%	0.48	%	0.26	%	(0.31	)%	—	%	0.81	%	0.52	%
Ending Yield	4.90	%	7.79	%	14.69	%	7.19	%	4.90	%	7.79	%	14.69	%	7.19	%

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As of December 31, 2014, our portfolio had a fair market value of $276.4 million, a cost basis of $282.1 million and was comprised of 70% first lien loans, 11% second lien loans and 19% CLO equity, measured at fair value. The Loan Portfolio consisted of 117 portfolio companies in 40 industries, and the CLO portfolio included 16 CLOs managed by 14 collateral managers. Our Loan Portfolio consisted of all floating rate investments with 100% having LIBOR floors ranging between 1.00% and 1.75%. The weighted average LIBOR floor in our Loan Portfolio was 1.03% as of December 31, 2014. The following table depicts a summary of the portfolio as of December 31, 2014:

($ in thousands)	Cost		Fair Market Value		Cumulative Net Unrealized Depreciation			Yield at Cost
Investment Portfolio:
First lien floating rate loans	$	198,028	$	194,952	$	(3,076	)	4.98	%
Second lien floating rate loans	30,842		29,841		(1,001		)	7.81	%
Total Senior Floating Rate Loans	228,870		224,793		(4,077		)	5.36	%
CLO equity	53,263		51,577		(1,686		)	13.64	%
Total Investment Portfolio	$	282,133	$	276,370	$	(5,763	)	6.92	%

During the year ended December 31, 2014, we purchased Senior Secured Floating Rate Loans of 120 portfolio companies (102 new and 18 existing) for a total purchase price of $199.9 million with a weighted average yield at cost of 5.5%. During the year ended December 31, 2014, we purchased nine CLO equity investments (eight new and one existing) for an aggregate purchase price of $26.7 million with a weighted average yield of 12.5%. Investment sales and repayments during the year ended December 31, 2014 totaled $106.4 million and $42.1 million, respectively. As a result of CLO equity representing a larger percentage of the portfolio and active portfolio management, the weighted average yield on the portfolio increased 31 basis points during the year to 6.9% as of December 31, 2014. The average yield during the year on our Loan portfolio, CLO investments and total portfolio was 5.3%, 13.0% and 6.5%, respectively.

The following tables depict the portfolio activity for the year:

	For the Year Ended December 31, 2014
	First Lien					Second Lien					CLO Equity					Total
$ in thousands	Amount			Yield (at cost)		Amount			Yield (at cost)		Amount			Yield (at cost)		Amount		Yield (at cost)
December 31, 2013	$	154,207		4.90	%	$	15,186		7.97	%	$	30,172		14.64	%	$199,565		6.61	%
Purchases	169,360			5.06	%	30,571			8.01	%	26,697			12.51	%	226,628		6.19	%
Sales	(93,690		)	(4.82	)%	(12,724		)	(8.39	)%	—			—	%	(106,414)		(5.24	)%
Repayments (1)	(30,904		)	(5.23	)%	(2,030		)	(7.65	)%	(9,113		)	(13.27	)%	(42,047)		(7.09	)%
Amortization / accretion of discount / premium (2)	(7		)	n/a		14			n/a		5,501			n/a		5,508		n/a
Realized gains / (losses)	128			n/a		62			n/a		—			n/a		190		n/a
Unrealized appreciation / (depreciation)	(4,142		)	n/a		(1,238		)	n/a		(1,680		)	n/a		(7,060)		n/a
December 31, 2014	$	194,952		4.98	%	$	29,841		7.81	%	$	51,577		13.64	%	$	276,370	6.92	%

(1) Repayments for CLO equity reflect the amount of cash distributions from CLO investments received during the year ended December 31, 2014.

(2) Amount reflected in amortization/accretion of discount/premium for CLOs represent the income recognized during the year ended December 31, 2014 using the effective interest method.

	For the Year Ended December 31, 2014
	Loan	CLO	Total Portfolio
Portfolio Companies - December 31, 2013	69	8	77
Purchases (new)	102	8	110
Purchases (add-on to existing)	18	1	19
Complete Exit	54	—	54
Portfolio Companies - December 31, 2014	117	16	133

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As of December 31, 2013, our portfolio had a fair market value of $199.6 million, a cost basis of $198.3 million and was comprised of 77% first lien loans, 8% second lien loans and 15% CLO equity, measured at fair value. The Loan Portfolio consisted of 72 portfolio companies in 30 industries, and the CLO portfolio included 8 CLOs managed by 7 collateral managers. Our Loan Portfolio consisted of all floating rate investments with 99% having LIBOR floors ranging between 1.00% and 1.50%. The weighted average LIBOR floor in our Loan Portfolio was 1.03% as of December 31, 2013. The following table depicts a summary of the portfolio as of December 31, 2013:

($ in thousands)	Cost		Fair Market Value		Cumulative Net Unrealized Depreciation			Yield at Cost
Investment Portfolio:
First lien floating rate loans	$	153,141	$	154,207	$	1,066		4.90	%
Second lien floating rate loans	14,949		15,186		237			7.97	%
Total Senior Floating Rate Loans	168,090		169,393		1,303			5.17	%
CLO equity	30,178		30,172		(6		)	14.64	%
Total Investment Portfolio	$	198,268	$	199,565	$	1,297		6.61	%

As of June 30, 2015, approximately 80% of our Loan Portfolio, at fair value, was comprised of loans with a facility rating by S&P of at least "B" or higher. The following chart shows the S&P facility credit rating of our Loan Portfolio at fair value as of June 30, 2015:

First Lien Second Lien

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As of December 31, 2014, approximately 77% of our Loan Portfolio, at fair value, was comprised of loans with a facility rating by S&P of at least "B" or higher. The following chart shows the S&P facility credit rating of our Loan Portfolio at fair value as of December 31, 2014:

First Lien Second Lien

As of December 31, 2013, approximately 86% of our Loan Portfolio, at fair value, was comprised of loans with a facility rating by S&P of at least "B" or higher. The following chart shows the S&P facility credit rating of our Loan Portfolio at fair value as of December 31, 2013:

First Lien Second Lien

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Results of Operations

Operating results for the three and six months ended June 30, 2015 and 2014 were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
($ in thousands, except per share data)	2015			2014			2015			2014 (1)
Investment income:
First lien floating rate loans	$	2,401		$	2,433		$	4,833		$	4,697
Second lien floating rate loans	606			674			1,206			1,112
CLO equity	1,873			1,483			3,582			2,578
Total investment income	4,880			4,590			9,621			8,387
Expenses:
Interest and other debt related costs	758			781			1,513			1,869
Management fee	563			574			1,141			1,000
Other expenses, net	282			278			560			555
Net expenses	1,603			1,633			3,214			3,424
Net investment income before taxes	3,277			2,957			6,407			4,963
Income tax provision	(57		)	(30		)	(127		)	(109		)
Net investment income	3,220			2,927			6,280			4,854
Net realized and unrealized (loss) / gain on investments:
Net realized gain on investments	78			115			385			264
Net unrealized (depreciation) / appreciation on investments	(150		)	(193		)	274			51
Income tax benefit / (provision)	11			—			11			(200		)
Net realized and unrealized (loss) / gain on investments	(61		)	(78		)	670			115
Net increase in net assets resulting from operations	$	3,159		$	2,849		$	6,950		$	4,969

(1) The source of debt financing, tax structure and average portfolio size changed following the IPO which occurred during the six months ended June 31, 2014. As such, the period presented may not be comparable to the six months ended June 31, 2015.

Investment Income

Investment income increased $0.3 million to $4.9 million for the three months ended June 30, 2015 over the comparable period in 2014. The increase was primarily driven by CLO equity investments, which represented a greater percentage of the portfolio, on average, during the second quarter of 2015 compared to the second quarter of 2014. Additionally, CLO equity had a higher yield during the three months ended June 30, 2015 than the comparable period in 2014. The increase in investment income from CLO equity investments was partially offset by a decline in revenue from the Loan Portfolio due to its lower yield from tighter new issue spreads and the repricing of approximately 10% of the first lien portion of the Loan Portfolio during the three months ended June 30, 2015. Investment income increased $1.2 million to $9.6 million for the six months ended June 30, 2015 compared to the comparable period in 2014. The increase was a result of various factors including a larger investment portfolio, on average, and an increase to the yield on the total investment portfolio primarily as a result of CLO equity investments representing a greater percentage of the portfolio.

Net Expenses

Net expenses remained stable at $1.6 million for the three months ended June 30, 2015 compared to the comparable period in 2014 with no significant fluctuations in borrowing costs, management fees or other net expenses. Net expenses declined $0.2 million for the six months ended June 30, 2015 over the comparable period in 2014. The decline was driven by a reduction of interest expense due to a lower average cost of funding, which was partially offset by higher management fees as a result of prorating the fee for the first quarter of 2014 since the management agreement did not take effect until the closing of the IPO.

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The following table outlines the costs associated with our debt financing during the three and six months ended June 30, 2015 and 2014:

	Three Months Ended June 30,						Six Months Ended June 30,
($ in thousands)	2015			2014			2015			2014
Interest expense	$	635		$	668		$	1,272		$	1,635
Commitment fees	26			15			47			40
Amortization of debt financing costs	97			98			194			194
Total Debt Financing Costs	$	758		$	781		$	1,513		$	1,869
Average debt outstanding	$	126,259		$	132,364		$	127,601		$	125,815
Average cost of funding (1)	2.41		%	2.36		%	2.39		%	2.99		%
Weighted average interest rate	1.99		%	2.00		%	1.98		%	2.59		%

(1) Includes interest, unfunded commitment fees and amortization of debt financing costs

Debt financing costs decreased slightly during the three months ended June 30, 2015 over the comparable period in 2014 primarily as a result of less debt outstanding, on average, during the period.

Costs associated with debt financing decreased by $0.4 million for the six months ended June 30, 2015 over the comparable period in 2014. The decline was primarily driven by a decrease in the average interest rate during the first half 2015. Prior to the closing of the IPO, there was $194.7 million outstanding on the ACAM Facility, which bore an average interest rate of 5.00%. Following the IPO, the ACAM Facility was repaid and all subsequent borrowings were provided by the BAML Facility at a significantly lower average rate of LIBOR+1.80%.

Net Realized Gains

Sales and repayments of investments during the three months ended June 30, 2015 totaled $41.1 million resulting in net realized gains of $0.1 million. Sales and repayments of investments during the six months ended June 30, 2015 totaled $83.5 million resulting in net realized gains of $0.4 million. The sale of one CLO equity position contributed $0.3 million of realized gains during the six months ended June 30, 2015.

Sales and repayments of investments during the three months ended June 30, 2014 totaled $43.6 million, resulting in net realized gains of $0.1 million. Sales and repayments of investments during the six months ended June 30, 2014 totaled $63.3 million, resulting in net realized gains of $0.3 million.

Net Unrealized Appreciation / Depreciation

During the three months ended June 30, 2015, we recognized net unrealized depreciation on the investment portfolio of $0.2 million, which was primarily driven by unrealized depreciation of $0.6 million from one first lien investment as a result of idiosyncratic risks at the portfolio company, which was partially offset by net unrealized appreciation of $0.4 million from the remainder of the investment portfolio. Exclusive of the previously mentioned first lien investment, the Loan Portfolio contributed $0.1 million of net unrealized appreciation, which was consistent with the relative stability of loan prices in the overall market. CLO equity contributed $0.3 million of net unrealized appreciation as a result of strong cash flows received during the quarter and actual defaults being less than forecast default rates. The net unrealized depreciation on investments for the three months ended June 30, 2014 was $0.2 million.

During the six months ended June 30, 2015, we recognized net unrealized appreciation on the investment portfolio of $0.3 million. The Loan Portfolio produced $1.3 million of net unrealized appreciation during the six months ended June 30, 2015, which was reflective of higher prices in the broadly syndicated U.S. loan market as a result of continued demand for loans from CLO formation coupled with lackluster primary new loan issuance. The net unrealized appreciation on the Loan Portfolio was partially offset by $1.0 million of net unrealized depreciation from CLO equity, which was primarily the result of an increase to the discount rate used in the valuations and the reversal of previously recognized unrealized appreciation of $0.2 million upon the exit of one CLO position. The net unrealized appreciation on investments for the six months ended June 30, 2014 was $0.1 million, which was primarily the result of appreciation on the portfolio purchased during the period in the primary market.

Taxes

We intend to elect to be treated as a RIC under subchapter M of the Code for income tax purposes. In order to qualify as a RIC, among other things, we are required to meet certain source of income and asset diversification requirements; additionally, we must distribute annually at least 90% of our ordinary income, including net short term gains in excess of net long term losses. So long as we qualify as a RIC, we generally are not subject to the entity level taxes on earnings timely distributed to our stockholders. At our discretion, we may delay distributions of a portion of our current year taxable income to the subsequent year and pay 4%

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excise taxes on such deferred distributions as calculated under the Code. If we anticipate paying excise taxes, we accrue excise taxes on a quarterly basis based on our estimates. For the three months ended June 30, 2015 and 2014, we accrued federal excise tax of $70 thousand and $30 thousand, respectively. For the six months ended June 30, 2015 and 2014, we accrued federal excise tax of $140 thousand and $30 thousand, respectively.

Operating results for the year ended December 31, 2014 and the period ended December 31, 2013 were as follows:

($ in thousands except per share data)	Year Ended December 31, 2014			Period from October 15, 2013* to December 31, 2013
Investment income:
First lien floating rate loans	$	9,884		$	973
Second lien floating rate loans	2,389			82
CLO equity	5,500			517
Total investment income	17,773			1,572
Expenses:
Interest and other debt related costs	3,448			951
Management fee	2,186			—
Other expenses (net)	1,121			93
Net expenses	6,755			1,044
Net investment income before tax	11,018			528
Income tax provision	(159		)	(282		)
Net investment income	10,859			246
Realized and unrealized (loss) gain on investments:
Net realized gain (loss) on investments	190			(7		)
Net unrealized (depreciation) appreciation on investments	(7,060		)	1,297
Income tax provision	(200		)	(521		)
Net realized and unrealized (loss) gain on investments	(7,070		)	769
Net increase in net assets resulting from operations	$	3,789		$	1,015

* Commencement of Operations

Investment Income

Investment income for the year ended December 31, 2014 was $17.8 million. Interest generated from Loan investments totaled $12.3 million and income from the CLO investments totaled $5.5 million for the year ended December 31, 2014. The average yield on our Loan portfolio during the year ended December 31, 2014 was 5.3% and the average yield on our CLO investments during the year ended December 31, 2014 was 13.0% for a weighted average total yield on the portfolio during the year of 6.5%. Investment income for the period ended December 31, 2013 was $1.6 million. Interest generated from Loan investments totaled $1.1 million and income from the CLO investments totaled $0.5 million for the period ended December 31, 2013.

Net Expenses

Net expenses for the year ended December 31, 2014 were $6.8 million, primarily comprised of interest and other debt related costs of $3.4 million, management fees of $2.2 million and other general and administrative expenses. Net expenses for the period ended December 31, 2013 were $1.0 million, primarily comprised of interest and other debt related costs of $1.0 million.

Interest and other debt related costs incurred in 2013 and from January 1, 2014 until January 22, 2014 (the closing date of the IPO) primarily related to interest expense on the ACAM Facility. There was $194.7 million outstanding on the ACAM Facility at the time of the closing of the IPO, at which point the ACAM Facility was repaid in full and terminated. The weighted average interest rate on the ACAM Facility was 5.0%.

Interest and other debt related costs incurred following the closing date of the IPO through December 31, 2014 are related to borrowings under our Credit Facility. The Credit Facility generally bears interest at a spread of 1.80% over a chosen index (which is typically one-month LIBOR). Included in other debt related costs are additional fees and expenses associated with the

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Credit Facility, including an unused commitment fee of 75 basis points on undrawn commitments and the amortization of debt financing costs.

The following table outlines the costs associated with our debt financing during 2013 and 2014:

	For the period from January 1, 2014 to January 22, 2014		For the period from January 22, 2014 to December 31, 2014		For the Year and Period Ended December 31,
($ in thousands)					2014		2013
Interest expense	$	568	$	2,433	$	3,001	$	943
Commitment fees	—		54		54		—
Amortization of debt financing costs	22		371		393		8
Total Financing Costs	$	590	$	2,858	$	3,448	$	951
Average debt outstanding	$194,748		$127,092		$130,984		$89,524
Average cost of funding (1)	5.00%		2.39%		2.63%		5.00%
Weighted average interest rate	5.00%		2.00%		2.26%		5.00%

(1) Includes amortization of debt financing costs

Management fees were $2.2 million for the year ended December 31, 2014. The accrual for management fees commenced upon the receipt of the IPO proceeds, which occurred on January 22, 2014, and was prorated for the first quarter based on the number of days the management agreement was in effect.

Other operating expenses totaled $2.1 million for the year ended December 31, 2014 and are comprised primarily of insurance premiums, Board of Director fees, professional fees and rent. However, as a result of the Expense Cap, our Manager was responsible for $1.0 million of our expenses, which resulted in our other operating expenses (net) totaling $1.1 million for the year ended December 31, 2014.

Net Realized Gains / Losses

Sales and repayments of investments during the year ended December 31, 2014 totaled $106.4 million and $42.0 million, respectively, resulting in net realized gains of $0.2 million, or $0.02 per weighted average share outstanding. Sales and repayments of investments during the period ended December 31, 2013 totaled $5.9 million and $3.9 million, respectively, resulting in net realized losses of less than $(0.1) million.

Net Unrealized Appreciation / Depreciation

During the year ended December 31, 2014, we recognized net unrealized depreciation on the investment portfolio of $(7.1) million. The depreciation, especially in the fourth quarter, was largely a function of exposure to the oil and gas industry, which was impacted by declines in oil prices during the second half of the year. The remaining net depreciation was a result of overall price changes observed in the broader market, which reflected an increase to the required rate of return for positions with otherwise stable credit profiles. During the period ended December 31, 2013, ACSF recognized net unrealized appreciation on the investment portfolio of $1.3 million, primarily from the Loan portfolio, the fair value of which moved in-line with the broader market.

Taxes

From our inception through the date of our IPO, we were a taxable corporation under Subchapter C of the Code ("C corporation"), subject to federal and state income taxes on our taxable ordinary income and capital gains. Prior to our IPO, we were a wholly-owned subsidiary of ACAM, which is wholly-owned by American Capital. As such, we were required to be consolidated in American Capital’s federal consolidated tax group, which has a September 30 tax year end. We had a tax sharing agreement with American Capital and other members of the consolidated tax group, under which such members bore their full share of their individual tax obligation and members were compensated for their losses and other tax benefits that were able to be used by other members of the consolidated tax group based on their pro forma stand-alone federal income tax return. We recognized $1.1 million of federal and state tax expense related to our operations prior to the IPO.

We intend to elect to be taxed as a RIC under Subchapter M of the Code beginning with the date of our IPO through our tax fiscal year end of December 31 and for subsequent years. As part of our election to be taxed as a RIC, we intend to make a “deemed sale election” whereby we will treat our net unrealized gains (“net built-in gain”) on the date of our IPO as recognized for tax purposes in our final pre-IPO C corporation federal tax return. The federal tax sharing payment that we owed to American Capital attributed to our net built-in gain was $0.6 million. American Capital waived this payment which was then treated as a deemed capital contribution to us.

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Excluding the deemed sale election, there were no significant tax consequences arising from the conversion to a RIC from a C corporation in connection with our IPO.

As of December 31, 2014, we had approximately $2.0 million, or $0.20 per share, of estimated undistributed taxable income. We intend to distribute sufficient dividends, including dividends distributed in the following tax year that we elect to be treated as distributed in the current year, to eliminate our current year taxable income. For the year ended December 31, 2014, we accrued federal excise tax of $0.1 million.

Financial Condition, Liquidity and Capital Resources

Liquidity and capital resources arise primarily from our Credit Facility and cash flow from operations. In addition, we expect to use proceeds from any follow-on equity offerings of common stock and other supplementary financing mechanisms as additional sources of capital and liquidity.

In order to qualify as a RIC, we must annually distribute in a timely manner to our stockholders at least 90% of our taxable ordinary income. In addition, we must also distribute in a timely manner to our stockholders all of our taxable ordinary and capital income in order to not be subject to income taxes. Accordingly, our ability to retain earnings is limited.    

Equity Capital

As a BDC, we are generally not able to issue or sell our common stock at a price below our net asset value per share, exclusive of any underwriting discount, except (i) with the prior approval of a majority of our stockholders, (ii) in connection with a rights offering to our existing stockholders or (iii) under such other circumstances as the SEC may permit. As of June 30, 2015, our net asset value was $14.54 per share and our closing market price was $12.65 per share. As of December 31, 2014, our net asset value was $14.42 per share and our closing market price was $12.11 per share.

Debt Capital

As of June 30, 2015, we had $123.8 million in borrowings outstanding on our Credit Facility and our debt to equity ratio was 0.85x. The fair value of assets pledged as collateral on our Credit Facility as of June 30, 2015 were $214.4 million. As of June 30, 2015, we had approximately $18.7 million of available liquidity consisting of $2.5 million of cash and cash equivalents and $16.2 million of available capacity on our Credit Facility. As of December 31, 2014, we had $130.0 million in borrowings outstanding on our Credit Facility and our debt to equity ratio was 0.90x. The fair value of assets pledged as collateral on our Credit Facility as of December 31, 2014 were $220.4 million. As of December 31, 2014, we had approximately $11.8 million of available liquidity consisting of $1.8 million of cash and cash equivalents and $10.0 million of available capacity on our Credit Facility.

The commitment termination date on our Credit Facility is November 18, 2015, and all outstanding borrowings on that date must be repaid by the maturity date of December 18, 2015, unless the Credit Facility is otherwise extended. Prior to the commitment termination date, we plan to either extend the Credit Facility or obtain a new debt financing facility to replace the Credit Facility.

As a BDC, we are permitted to issue “senior securities,” as defined in the 1940 Act, in any amount as long as immediately after such issuance our asset coverage is at least 200%, or equal to or greater than our asset coverage prior to such issuance, after taking into account the payment of debt with proceeds from such issuance. Asset coverage is defined in the 1940 Act as the ratio of the value of the total assets, less all liabilities and indebtedness not represented by senior securities, to the aggregate amount of senior securities representing indebtedness. However, if our asset coverage is below 200%, we may also borrow amounts up to 5% of our total assets for temporary purposes even if that would cause our asset coverage ratio to further decline. As of June 30, 2015, our asset coverage was 217%. As of December 31, 2014, our asset coverage was 211%.

Operating and Financing Cash Flows

For the six months ended June 30, 2015, net cash provided by operating activities was $14.6 million and was primarily derived from the collection of interest on our investment portfolio and net proceeds from purchases and sales of investments. For the six months ended June 30, 2015, net cash used in financing activities was $13.9 million and was primarily used to pay $7.7 million of dividends and reduce debt outstanding by $6.2 million. For the six months ended June 30, 2014, net cash used in operating activities was $89.0 million and was primarily a result of net investment purchases of $85.1 million. For the six months ended June 30, 2014, net cash provided by financing activities was $80.4 million and was primarily attributable to net proceeds from our IPO of $149.2 million offset by a net decrease in the amount of debt outstanding of $66.7 million.

Off-Balance Sheet Arrangements

We do not currently engage in off-balance sheet arrangements.

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Dividends

When determining dividends, our Board of Directors considers estimated taxable income, GAAP income and economic performance. Actual taxable income may differ from GAAP income due to temporary and permanent differences in income and expense recognition and changes in unrealized appreciation and depreciation on investments. The specific tax characteristics will be reported to stockholders on Form 1099 after the end of the calendar year. We currently expect dividends for 2015 to be from ordinary taxable income.

On May 4, 2015, we announced a monthly dividend of $0.097 per share for each of May, June and July 2015. On August 3, 2015, we announced a monthly dividend of $0.097 per share for each of August, September and October 2015. On November 2, 2015, we announced a monthly dividend of $0.097 per share for each of November 2015, December 2015 and January 2016. Since our January 2014 IPO, we have declared a total of $22.9 million in dividends, or $2.290 per share.

The table below details the dividends declared on our shares of common stock since the completion of our IPO (dollars in thousands, except per share data):

Quarterly Dividend Declaration Date	Ex-Dividend Date	Record Date	Payment Date	Per Share Amount	Total Amount
March 17, 2014	March 27, 2014	March 31, 2014	April 10, 2014	$0.180	$1,800
June 18, 2014	June 26, 2014	June 30, 2014	July 10, 2014	$0.280	$2,800
September 17, 2014	September 26, 2014	September 30, 2014	October 10, 2014	$0.280	$2,800
December 18, 2014	December 29, 2014	December 31, 2014	January 9, 2015	$0.290	$2,900
March 19, 2015	March 27, 2015	March 31, 2015	April 6, 2015	$0.290	$2,900
Monthly Dividend Declaration Date	Ex-Dividend Date	Record Date	Payment Date	Per Share Amount	Total Amount(1)
March 19, 2015	April 17, 2015	April 21, 2015	May 4, 2015	$0.097	$970
May 4, 2015	May 20, 2015	May 22, 2015	June 2, 2015	$0.097	$970
May 4, 2015	June 17, 2015	June 19, 2015	July 2, 2015	$0.097	$970
May 4, 2015	July 22, 2015	July 24, 2015	August 4, 2015	$0.097	$970
August 3, 2015	August 19, 2015	August 21, 2015	September 2, 2015	$0.097	$970
August 3, 2015	September 18, 2015	September 22, 2015	October 2, 2015	$0.097	$970
August 3, 2015	October 21, 2015	October 23, 2015	November 3, 2015	$0.097	$970
November 2, 2015	November 18, 2015	November 20, 2015	December 2, 2015	$0.097	$970
November 2, 2015	December 22, 2015	December 24, 2015	January 5, 2016	$0.097	$970
November 2, 2015	January 20, 2016	January 22, 2016	February 2, 2016	$0.097	$970
Inception to Date Total				$2.290	$22,900

(1) Future dividend amounts do not assume issuance of shares under the dividend reinvestment and stock purchase plan

We maintain an "opt out" dividend reinvestment and stock purchase plan for our common stockholders. As a result, if we declare a dividend, then stockholders' cash dividends will be automatically reinvested in additional shares of our common stock, unless they, or their nominees on their behalf, specifically "opt out" of the dividend reinvestment and stock purchase plan so as to receive cash dividends.

Critical Accounting Policies

The preparation of consolidated financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and revenues and expenses during the periods reported. Actual results could materially differ from those estimates. The following is a summary of our accounting policies that are most affected by judgments, estimates and assumptions, which relate to the estimation of fair value of portfolio investments and revenue recognition.

Valuation of Portfolio Investments

We value our investments in accordance with the 1940 Act and ASC 820, as determined in good faith by our Board of Directors.

We undertake a multi-step valuation process to determine the fair value of our investments in accordance with ASC 820. The valuation process begins with the development of a preliminary valuation recommendation for each investment as determined

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in accordance with our valuation policy by a group of our Manager’s valuation, accounting and finance professionals, which is independent of our Manager’s investment team. To prepare the proposed valuation, the group reviews information provided by a nationally recognized independent pricing service and broker-dealers, and may consult with the investment team and other internal resources of our Manager and its affiliates. The preliminary valuation recommendations are then presented to the Investment Committee and reviewed and approved by our Audit and Compliance Committee. The valuation recommendations are then reviewed by our Board of Directors for final approval.

ASC 820 provides a framework for measuring the fair value of assets and liabilities and provides guidance regarding a fair value hierarchy, which prioritizes information used to measure fair value and the effect of fair value measurements on earnings. When available, we determine the fair value of our investments using unadjusted quoted prices from active markets. Where inputs for an asset or liability fall into more than one level in the fair value hierarchy, the investment is classified in its entirety based on the lowest level input that is significant to that investment’s fair value measurement. We use judgment and consider factors specific to the investment when determining the significance of an input to a fair value measurement. Our policy is to recognize transfers in and out of levels as of the beginning of each reporting period. The three levels of the fair value hierarchy and investments that fall into each of the levels are described below:

Level 1: Inputs are unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. This may include valuations based on executed trades, broker quotations that constitute an executable price, and alternative pricing sources supported by observable inputs which, in each case, are either directly or indirectly observable for the asset in connection with market data at the measurement date.

Level 3: Inputs are unobservable and cannot be corroborated by observable market data. In certain cases, investments classified within Level 3 may include securities for which we have obtained indicative quotes from broker-dealers that do not necessarily represent prices the broker may be willing to trade on.

The valuation techniques used maximize the use of observable inputs and minimize the use of unobservable inputs. Our SFRLs are predominately valued based on evaluated prices from a nationally recognized independent pricing service or from third-party brokers who make markets in such debt investments. When possible, we make inquiries of third-party pricing sources to understand their use of significant inputs and assumptions. We review the third-party fair value estimates and perform procedures to validate their reasonableness, including an analysis of the range and dispersion of third-party estimates, frequency of pricing updates, comparison of recent trade activity for similar securities, and review for consistency with market conditions observed as of the measurement date.

There may be instances when independent or third-party pricing sources are not available, or cases where we believe that the third-party pricing sources do not provide sufficient evidence to support a market participant’s view of the fair value of the debt investment being valued. These instances may result from an investment in a less liquid loan such as a middle market loan, a mezzanine loan or unitranche loan, or a loan to a company that has become financially distressed. In these instances, we may estimate the fair value based on a combination of a market yield valuation methodology and evaluated pricing discussed above, or solely based on a market yield valuation methodology. Under the market yield valuation methodology, we estimate the fair value based on a discounted cash flow technique. For these debt investments, the unobservable inputs used in the market yield valuation methodology to measure fair value reflect management’s best estimate of assumptions that would be used by market participants when pricing the investment in a hypothetical transaction, including estimated remaining life, current market yield and interest rate spreads of similar loans and securities as of the measurement date. We will estimate the remaining life based on market data for the average life of similar loans. However, if we have information that the loan is expected to be repaid in the near term, we would use an estimated remaining life based on the expected repayment date. The average life to be used to estimate the fair value of our loans may be shorter than the legal maturity of the loans since many loans are prepaid prior to the maturity date. The interest rate spreads used to estimate the fair value of our loans is based on current interest rate spreads of similar loans. If there is a significant deterioration of the credit quality of a loan, we may consider other factors that a hypothetical market participant would use to estimate fair value, including the proceeds that would be received in a liquidation analysis.

We estimate the fair value of our CLO equity investments using a combination of third-party broker quotes, purchases or sales of the same or similar securities, and cash flow forecasts subject to assumptions that a market participant would use regarding the investments’ underlying collateral including, but not limited to, assumptions for default and recovery rates, reinvestment spreads and prepayment rates. Cash flow forecasts are discounted using market participant’s market yield assumptions that are derived from multiple sources including, but not limited to, third-party broker quotes, industry research reports and transactions of securities and indices with similar structures and risk characteristics. We weight the use of third-party broker quotes, if any, when determining fair value based on our understanding of the level of actual transactions used by the broker to develop the quote and whether the quote was an indicative price or binding offer, the depth and consistency of broker quotes and the correlation of changes in broker quotes with underlying performance and other market indices.

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Investment Income

For debt investments, we record interest income on the accrual basis to the extent that such amounts are expected to be collected. OID and purchased discounts and premiums are accreted/amortized into interest income using the effective interest method, where applicable. Loan origination fees are deferred and accreted into interest income using the effective interest method. We record prepayment premiums on loans and other investments as interest income when such amounts are received. We stop accruing interest on investments when it is determined that interest is no longer collectible. As of June 30, 2015 and 2014, we had no loans on non-accrual status.

Interest income on the CLO equity investments is recognized using the effective interest method as required by ASC Subtopic 325-40, Investments-Other, Beneficial Interests in Securitized Financial Assets. At the time of purchase, we estimate the future expected cash flows and determine the effective interest rate based on these estimated cash flows and our cost basis. Subsequent to the purchase, the estimated future cash flows are updated quarterly and a revised yield is calculated prospectively based on the current amortized cost of the investment as adjusted for credit impairments, if any.

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RECENT DEVELOPMENTS

On August 3, 2015, we declared monthly cash dividends of $0.097 per share of common stock for each of August, September and October of 2015 that is payable on September 2, 2015, October 2, 2015 and November 3, 2015, respectively, to common stockholders of record as of August 21, 2015, September 22, 2015 and October 23, 2015, respectively, with ex-dividend dates of August 19, 2015, September 18, 2015 and October 21, 2015, respectively. On November 2, 2015, we declared monthly cash dividends of $0.097 per share of common stock for each of November and December of 2015 and January of 2016 that is payable on December 2, 2015, January 5, 2016 and February 2, 2016, respectively, to common stockholders of record as of November 20, 2015, December 24, 2015 and January 22, 2016, respectively.

On October 29, 2015, ACSF Funding amended and restated the Credit Facility with Bank of America, N.A. to extend the maturity date from December 18, 2015 to December 18, 2018, decrease the commitment amount from $140 million to $135 million and implement an unused fee holiday when the facility is at least 90% utilized. Amounts drawn under the Credit Facility will continue to bear interest at a rate per annum equal to either (a) LIBOR plus 1.80%, or (b) 0.80% plus the highest of (i) the Federal funds rate plus 0.50%, (ii) Bank of America, N.A.’s prime rate or (iii) one-month LIBOR plus 1%.

In October 2015, our Board of Directors and a majority of the directors who are not “Interested Persons,” as defined under the 1940 Act, approved a renewal of our management agreement until January 15, 2017 and, subject to stockholder approval, an amendment and restatement of our management agreement, as described below. In October 2015, our Manager agreed to extend the 0.75% cap on other operating expenses until the date of our 2016 Annual Meeting of Stockholders, at which time we expect to submit to a vote of stockholders an amendment and restatement of the management agreement which would (i) extend the expense cap through December 31, 2020, (ii) subject to the expense cap, provide for reimbursement by us to our Manager for certain compensation expenses related to legal, compliance and internal audit personnel of our Manager and its affiliates who provide services to us and (iii) make certain other immaterial changes.  

BUSINESS

General

We were organized in February 2013 as a Maryland corporation and commenced operations on October 15, 2013. We are structured as an externally managed, non-diversified closed-end investment management company that has elected to be regulated as a BDC under the 1940 Act. For tax purposes, we intend to elect to be taxed as a RIC, as defined in Subchapter M of the Code. On November 14, 2013, we formed a wholly-owned consolidated special purpose financing vehicle, ACSF Funding I, LLC, a Delaware limited liability company.

In January 2014, we completed our IPO of 10.0 million shares of common stock at the public offering price of $15.00 per share for gross proceeds of $150.0 million. American Capital ACSF Management, LLC, our external Manager, is an indirect subsidiary of ACAM, which is a wholly-owned portfolio company of American Capital. Our common stock is listed on the NASDAQ Global Select Market, where it trades under the symbol “ACSF.”

Our investment objective is to provide attractive, risk-adjusted returns over the long term primarily through current income while seeking to preserve our capital. We actively manage a leveraged portfolio composed primarily of Senior Secured Floating Rate Loans, or Loans, which are diversified investments in first lien and second lien floating rate loans principally to large-market U.S.-based companies, which are commonly referred to as leveraged loans. S&P defines large-market loans as loans to issuers with EBITDA of greater than $50 million. We also invest in equity tranches of CLOs which are securitized vehicles collateralized primarily by Loans and we may invest in debt tranches of CLOs. In addition, we may selectively invest in loans issued by middle market companies, mezzanine and unitranche loans and high yield bonds. Additionally, we may from time to time hold or invest in other equity investments and other debt or equity securities generally arising from a restructuring of Loan positions previously held by us. We utilize leverage to enhance our returns and we are limited under the 1940 Act as a BDC on the amount of leverage we can utilize.

As of June 30, 2015, our investment portfolio totaled $272.2 million at fair value and our NAV was $145.4 million. Our portfolio was comprised of 127 Loan obligors totaling $218.3 million and 19 CLO equity investments totaling $53.9 million. During the six months ended June 30, 2015, we invested $75.1 million and investments sold or repaid totaled $83.5 million.

Our Manager

Our Manager is an indirect subsidiary of ACAM, which is a wholly-owned portfolio company of American Capital. Founded in 1986, American Capital is a publicly-traded private equity firm and global asset manager which directly and through its asset management business, originates, underwrites and manages investments in private equity, sponsored finance, real estate, energy and infrastructure, leveraged loans and CLOs. From its eight offices in the United States, Europe and Asia, American Capital had $81 billion in assets under management (including levered assets) as of June 30, 2015.

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Our Manager is responsible for administering our business activities and day-to-day operations, subject to the supervision and oversight of our Board of Directors. All of our officers and the members of our Manager’s senior investment team and other support personnel are employees of American Capital or the parent company of our Manager. Because neither we nor our Manager have any employees, our Manager has entered into an administrative services agreement with American Capital and the parent company of our Manager, pursuant to which our Manager will have access to their employees, including senior management and operations, finance, compliance, legal, capital markets, accounting, treasury, investor relations and information technologies staffs, and their infrastructure, operations, business relationships and management expertise, to enable our Manager to fulfill all of its responsibilities under the management agreement. Refer to “Risk Factors—Risks related to our relationship with our Manager and American Capital” for additional information.

Investment Focus

Our Board of Directors has approved as a principal investment strategy that, under normal market conditions, we will invest at least 80% of our assets in Senior Secured Floating Rate Loans or CLOs that are pooled investment vehicles that invest substantially all of their assets in Senior Secured Floating Rate Loans. This investment objective is a non-fundamental policy and may be changed without a stockholder vote. Stockholders will receive 60 days advance notice of any change. As a BDC, we are restricted from holding more than 30% of our assets in nonqualified investments, as defined by Section 55(a) of the 1940 Act. Investments in debt and equity tranches of CLOs are deemed nonqualified assets for BDC compliance purposes and therefore we are limited as to the amount of CLO investments we hold at any given time in our portfolio.

Senior Secured Floating Rate Loans

Senior Secured Floating Rate Loans are loans generally issued by U.S.-based middle market and large market private and public companies. Issuers typically use Senior Secured Floating Rate Loans to refinance existing debt, finance acquisitions or leveraged buyouts, to pay dividends and for other general corporate purposes.

Investors typically classify the Loan market by issuer size. S&P defines large-market loans as loans to companies with EBITDA of greater than $50 million and middle-market loans as loans to companies with EBITDA of less than $50 million.

Senior Secured Floating Rate Loans pay interest based on a floating rate typically calculated as a spread over LIBOR or another market index. Interest rates are periodically reset to reflect changes in market index rates. As a result of the recent low interest rate environment, many Senior Secured Floating Rate Loans include provisions defining a minimum market index rate, also referred to as an interest rate floor. Spreads are typically expressed in basis points and are defined at origination and may be adjusted over the life of a loan to account for changes in a borrower’s credit profile according to predefined credit covenants. Market spreads vary according to market dynamics. Senior Secured Floating Rate Loans are generally structured as minimally-amortizing loans with monthly interest payments and are typically collateralized by a company’s assets.

Senior Secured Floating Rate Loans may be structured with various lien priorities, such as first lien and second lien, on underlying collateral. Principal payments are generally applied based on lien position with second lien loans generally paid after payments to first lien loans or other loans with seniority in priority of payments. As a result, second lien loans are generally riskier and therefore have a higher spread compared to first lien loans. The market for second lien loans is significantly smaller and less liquid than the market for first lien loans.

Senior Secured Floating Rate Loans are generally rated “Ba1” or lower by Moody’s Investor Services, “BB+” or lower by S&P or “BB+” or lower by Fitch Ratings, Inc. (collectively, “below investment grade”).

Senior Secured Floating Rate Loans are typically arranged by a syndicate of investment or commercial banks, who syndicate loans to third-party investors (“the primary market”). After being placed into the primary market, investors may seek to buy and sell Senior Secured Floating Rate Loan positions to other investors in over-the-counter transactions (the “secondary market”). We invest in Senior Secured Floating Rate Loans through both the primary and secondary markets.

We concentrate our investment activities in Senior Secured Floating Rate Loans to those issued by companies with free cash flow generation, defensible market positions and attractive market dynamics. Our Manager and its affiliates have significant experience underwriting and managing investments across a number of industries and seek to create a diversified portfolio of investments across various industries in which they have direct expertise.

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The following is an illustrative list of the industries in which we have invested. We may also invest in other industries if we are presented with attractive opportunities.

Aerospace & Defense	Diversified Consumer Services	Independent Power and Renewable Electricity Producers	Metals & Mining
Auto Components	Diversified Telecommunications Services	Industrial Conglomerates	Multiline Retail
Building Products	Electrical Equipment	Insurance	Oil, Gas & Consumable Fuels
Capital Markets	Energy Equipment & Services	Internet & Catalog Retail	Pharmaceuticals
Chemicals	Food & Staples Retailing	Internet Software & Services	Professional Services
Commercial Services & Supplies	Food Products	IT Services	Real Estate Management & Development
Construction & Engineering	Health Care Equipment & Supplies	Life Sciences Tools & Services	Software
Constructions Materials	Health Care Providers & Services	Machinery	Textiles, Apparel & Luxury Goods
Containers & Packaging	Health Care Technology	Marine	Trading Companies & Distributors
Distributors	Hotels, Restaurants & Leisure	Media	Transportation Infrastructure

Listed below are the top ten industries in which our Senior Secured Floating Rate Loans were invested as of June 30, 2015 and December 31, 2014, represented as a percentage of our consolidated investment portfolio at fair value, excluding the CLO equity investments:

Industry	June 30, 2015	Industry	December 31, 2014
Software	10.6%	Health Care Providers & Services	9.9%
Health Care Providers & Services	9.1%	Media	7.7%
Media	8.0%	Software	7.4%
Aerospace & Defense	7.3%	Aerospace & Defense	7.4%
Insurance	5.1%	Hotels, Restaurants & Leisure	6.7%
Hotels, Restaurants & Leisure	4.5%	Commercial Services & Supplies	5.0%
Commercial Services & Supplies	4.4%	Insurance	4.1%
Health Care Equipment & Supplies	3.4%	Health Care Equipment & Supplies	3.3%
Foot & Staples Retailing	3.0%	Containers & Packaging	2.9%
Professional Services	2.9%	Oil, Gas & Consumable Fuels	2.8%

Collateralized Loan Obligations

A CLO is a special purpose vehicle that is formed to finance a pool of loans which meet predefined investment criteria. It is typically a managed vehicle that may trade and reinvest the loans and generally raises capital by issuing both debt and equity securities. Typically, a CLO will issue various classes, or “tranches,” of debt broadly categorized as senior and subordinate debt tranches as well as an equity tranche.

CLO securities receive cash flows generated by underlying collateral according to a defined payment waterfall. Principal and interest payments to CLO debt tranches are typically paid sequentially, with senior debt tranches receiving cash flows prior to subordinate debt tranches. The risk and return to CLO debt tranches vary depending upon each tranche’s right to collect cash flows generated by the underlying collateral. CLO debt tranches are generally rated, with ratings ranging from the highest investment grade to below investment grade, with coupons commensurate with the risk of each tranche. CLO debt tranches are also generally structured with covenants which, if violated, divert cash flows to the senior tranches prior to making any interest or principal payments to subordinate debt tranches or equity tranches.

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Unlike debt securities issued by CLOs, CLO equity securities are not rated and do not have contractually stated payment schedules. At origination, the weighted average interest rate of all CLO debt tranches is generally lower than the weighted average interest earned by a CLO’s underlying collateral, resulting in an interest rate spread. CLO equity securities receive residual cash flows, or the interest spread, generated by the underlying collateral after obligated payments for CLO debt securities and other expenses of the CLO have been made. CLO equity tranches typically comprise approximately 10% of total capital raised by a CLO.

CLOs are generally structured as managed entities, with a collateral manager assigned to manage the underlying CLO collateral within predefined investment criteria. CLOs are typically structured with a reinvestment period, during which prepayments and the sale of underlying collateral may be reinvested. Collateral managers are responsible for reinvesting proceeds for a CLO during the reinvestment period. By continuously reinvesting proceeds during the reinvestment period, the effective leverage on CLO equity securities is generally maintained during the reinvestment period.

A result of the typical CLO structure is that CLO equity tranches can generate relatively front-end loaded cash flows. CLO equity cash flows are also highly dependent on the credit performance of their underlying collateral pool. If loans within the collateral pool default, the reduced amount of performing collateral leads to lower cash flows available for distribution through CLO waterfalls, resulting in lower residual cash flows available for equity tranches. Residual cash flows are also impacted by changes in portfolio spreads for CLO collateral. Declines in spreads on newly issued collateral during the reinvestment period result in lower residual cash flows available for equity tranches.

We focus predominantly on CLOs collateralized primarily by Senior Secured Floating Rate Loans. Under normal market conditions, we expect to limit these investments to no more than 20% of the value of our portfolio.

Current Market Conditions

Economic and market conditions can impact our business and our investments in multiple ways, including the financial condition of the portfolio companies in which we invest, our investment returns, our funding costs, our access to the capital markets and our access to credit. The leveraged loan market has grown substantially in recent years with the amount of total leveraged loans outstanding exceeding $800 billion as of June 30, 2015. Growth has largely been a function of the resilient performance of the asset class across multiple credit cycles coupled with the changing regulatory and investor landscape and the attractive floating rate nature of the assets. Despite the size and liquidity of the loan market, there continues to be volatility in the loan market as a result of (i) the dynamic correlation between retail fund flows, the rate of CLO issuance and amount of new issue supply and (ii) the financial performance of the underlying issuers that comprise the asset class. Despite uncertainties regarding economic and market conditions, the new issue loan pipeline in the leveraged loan market remains active, with high quality first lien and second lien transactions supporting leveraged buyouts, strategic acquisitions, plant expansions, recapitalizations and refinancings for large to mid-sized borrowers. Similarly, the CLO equity pipeline also remains very healthy with a backlog of managers raising capital for new investment vehicles.

Portfolio Valuation

We value our investments on a quarterly basis, or more frequently if required, in accordance with GAAP and the 1940 Act.

Employees

We do not have any employees. We are managed by our Manager pursuant to the management agreement between our Manager and us.

Investment Committee

Our Manager has established an Investment Committee, consisting of Malon Wilkus, John Erickson, Samuel Flax, Mark Pelletier and Thomas McHale, each of whom is an officer of our Manager. The role of the Investment Committee is to monitor the performance of our Manager with respect to our investment strategy, to monitor our investment portfolio and to monitor our regulatory compliance. The Investment Committee meets as frequently as it believes is required to maintain prudent oversight of our investment activities. The Investment Committee has established operating policies and monitoring guidelines for ACSF and receives notification in the event we operate outside of such policies or guidelines.

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Senior Investment Team

Our Manager’s senior investment team currently consists of Mark Pelletier, Michael Cerullo, Dana Dratch, Juan Miguel Estela, Christian Toro, and William Weiss. One or more members of our Manager’s senior investment team must approve each new investment that we make. We consider our senior investment team, led by Mark Pelletier, to be our portfolio managers.

Underwriting Process

We take a qualitative and quantitative approach to sourcing, valuing and selecting investment opportunities. Our approach is grounded in fundamental analysis coupled with an active portfolio management strategy. Our underwriting approach culminates in the development of an investment thesis for each investment, giving consideration to various factors.

We begin by developing a macroeconomic understanding of current and expected economic conditions that provides the context for investment decisions. We also develop a view on each industry that we invest in or contemplate entering. When forming our view of an industry, several factors are considered. These factors include but are not limited to: (i) cyclicality, including demand elasticity of an industry’s products, (ii) defensibility of an industry’s position within the value chain, including consideration of the regulatory environment, (iii) pace of technological change and (iv) direction of industry-wide trends.

In addition, when assessing potential investments, we perform a fundamental analysis on each issuer. This analysis includes consideration of several investment specific factors. These factors include but are not limited to: (i) defensibility of market position, (ii) maturity of the business model, (iii) sustainability of a cash flow and strength of coverage ratios, (iv) consistency and level of historical performance relative to peers, (v) depth of management teams and alignment of incentives and (vi) the level and quality of leverage ratios.

We make investments with the context of our overall portfolio in mind. This is done to ensure that material or significant concentration risks do not develop within industry and issuer subclasses. Generally, we seek to diversify our portfolio across industries and issuers. The level of diversification can vary as the risk-reward profile of the portfolio changes. We actively manage our portfolio’s composition to ensure that the portfolio is optimally structured. Each security is also analyzed on a relative value basis.

We also evaluate market conditions before making investment decisions. Our view of market conditions is influenced by several factors including but not limited to: (i) current and expected liquidity in the market, (ii) relative value of issuances, (iii) level of spreads relative to other opportunities, (iv) covenant levels and (v) volume of new issuances. We actively manage our investment portfolio by investing in both the new issue and secondary loan markets as better relative value investment opportunities become available.

Portfolio Management

In order to maximize our returns for our stockholders, we employ robust portfolio and risk management processes. Our processes include monitoring market conditions and the performance of our investments. As a result of our portfolio and risk management processes, we may change the portfolio composition as we deem appropriate. On a quarterly basis, we perform a comprehensive review and reevaluation of our investments. As part of this process, we review the investment thesis for each position, as well as financial performance, covenant compliance, other credit issues and the relative value of our positions to similar securities in the market. Our analysis provides the basis for, and updates to, our recommendations for each portfolio position. Positions that have deviated significantly from their investment thesis will be placed on a list (our “Watch List”) and monitored more frequently. Members of our Manager’s senior investment team are actively involved in the quarterly review process and monitor changes to our recommendations and holdings of our portfolio.

In addition, on a monthly basis, we update the analysis for Watch List portfolio companies with current operating performance and the senior investment team discusses an overview of the risk exposure, mitigation strategies, secondary trading levels relative to the perceived recovery and justification for continued Watch List inclusion.

Our portfolio management process extends beyond the monthly and quarterly review processes. Through routine formal and informal meetings, our Manager’s senior investment team monitors Watch List constituents, performing positions and market conditions. The senior investment team receives real-time updates on portfolio company earnings, significant announcements and secondary trading price levels from the team of credit analysts and traders who support our business.

Competitive Advantages

We believe we have competitive advantages over other operators in the leveraged loan market and other BDCs that allow us to deliver attractive risk-adjusted returns to our stockholders. Our advantages include the following characteristics:

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Established Platform

The senior investment team has extensive experience investing across the loan market, in multiple credit cycles with, on average, over 20 years of investment experience. As of June 30, 2015, the senior investment team manages approximately $6 billion of investments across multiple CLOs, ACSF and other managed accounts of American Capital or its affiliates. In total, there are 19 investment professionals employed by American Capital or its affiliates who are dedicated to underwriting Senior Secured Floating Rate Loan and CLO investments and a 5-person transaction management team who are dedicated to overseeing the transaction processing and operations for Senior Secured Floating Rate Loans. Through our management agreement and the administrative services agreement, we have access to American Capital and its affiliates’ employees, including senior management, investment professionals, operations, finance, compliance, legal, capital markets, accounting, treasury, investor relations, internal audit and information technologies staffs, and their infrastructure, operations, business relationships and management expertise.

Portfolio Management

We manage our portfolio through a well-defined underwriting and portfolio management process as described above that leverages the established platform of American Capital and its affiliates. We believe this reduces the downside risk to our stockholders and provides a scalable framework for investing in the future.

Actively Managed Granular Portfolio

Our portfolio is granular with the maximum loan obligor exposure as of June 30, 2015 of 1.3% and an average position size of 0.6% of the portfolio. Due to the size and liquidity available in the Loan market, our Manager is able to actively manage the portfolio and respond to changes in credit quality or market tones to ensure the portfolio is optimized for our benefit. During the six months ended June 30, 2015, our portfolio turnover ratio was 27.59%.

Expense Structure

Our expenses are limited to our financing costs, taxes, costs incurred by our Manager and its affiliates for expenses related to our operations incurred on our behalf, excluding employment-related expenses and a 0.80% management fee. We do not pay our Manager any incentive fee. Additionally, through the date of our 2016 Annual Meeting of Stockholders, our other operating expenses, as defined in our management agreement, will be limited to an annual rate of 0.75% of our consolidated net assets, less net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter.

Competition

Our primary competitors include other BDCs, CLO investors, other credit focused investment funds, commercial and investment banks, commercial financing companies, insurance companies and, to the extent they provide an alternative form of financing, hedge funds. Many of our competitors are substantially larger and may have greater financial, technical and marketing resources than we do. For example, we believe some competitors may have access to funding sources that are not available to us. In addition, some of our competitors may have higher risk tolerances or different risk assessments, which could allow them to consider a wider variety of investments and establish more relationships than we can. Furthermore, many of our competitors are not subject to the regulatory restrictions that the 1940 Act imposes on us as a BDC or the requirements we must satisfy to maintain our qualification as a RIC. For additional information concerning the competitive risks we face, see “Risk Factors—Risks Related to Our Business and Structure—We operate in a highly competitive market for investment opportunities.”

Legal Proceedings

From time to time, we or our Manager may be a party to certain ordinary routine litigation incidental to our or its business, including the enforcement of our rights under contracts with our portfolio companies. We and our Manager are not currently subject to any material litigation nor, to our knowledge, is any material litigation threatened against us or our Manager.

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PORTFOLIO COMPANIES

The following table sets forth certain information as of June 30, 2015 (dollars in thousands), regarding each portfolio company in which we have an investment. All such investments have been made in accordance with our investment objective and strategies described in this prospectus. As of June 30, 2015, none of our investments exceeded 5% of our total assets. Our investments may be prepaid or our Manager may decide that it is in our best interests to sell an investment in the ordinary course of business.  We expect to reinvest any cash proceeds from such events in new investments in accordance with our investment strategy. 

	Industry	Par Amount		Cost		Fair Value
NON-CONTROLLED/NON-AFFILIATED INVESTMENTS
First Lien Floating Rate Loans
24 Hour Fitness Worldwide, Inc.	Hotels, Restaurants & Leisure	$	1,982	$	1,976	$	1,888
12647 Alcosta Boulevard #500
San Ramon, CA 94583
Accellent Inc.	Health Care Equipment & Supplies	1,975		1,975		1,967
100 Fordham Road
Wilmington, MA 01887
Acosta Holdco, Inc.	Media	2,488		2,447		2,483
600 Corporate Center Parkway
Jacksonville, FL 32216
ADMI Corp.	Health Care Providers & Services	550		549		553
281 Sanders Creek Parkway
East Syracuse, NY 13057
Aegis Toxicology Sciences Corporation	Health Care Providers & Services	1,650		1,641		1,592
515 Great Circle Road
Nashville, TN 37228
Air Medical Group Holdings, Inc.	Health Care Providers & Services	2,000		2,005		1,989
306 Davis Drive
P.O. Box 768
West Plains, MO 66775
Albertson's LLC	Food & Staples Retailing	998		993		1,003
250 Parkcenter Boulevard
Boise, ID 83706
Alliant Holdings I, LLC	Insurance	1,742		1,726		1,748
1301 Dove Street
Newport Beach, CA 92660
American Tire Distributors, Inc.	Distributors	1,486		1,479		1,502
12200 Herbert Wayne Court
Suite 150
Huntersville, NC 28070
Amneal Pharmaceuticals LLC	Pharmaceuticals	997		997		1,001
400 Crossing Boulevard
3rd Floor
Bridgewater, NJ 08807
AmWINS Group, LLC	Insurance	2,949		2,963		2,980
4725 Piedmont Row Drive
Suite 600
Charlotte, NC 28210
Anchor Glass Container Corporation	Containers & Packaging	1,000		995		1,002
401 East Jackson Street
Suite 1100
Tampa, FL 33602
Aquilex LLC	Commercial Services & Supplies	973		971		963
3344 Peachtree Road
Suite 2100
Atlanta, GA 30309
ARG IH Corporation	Hotels, Restaurants & Leisure	2,469		2,478		2,481
1180 Peachtree Street NE
Suite 2500
Atlanta, GA 30309

49

	Industry	Par Amount	Cost	Fair Value
Ascend Learning, LLC	Diversified Consumer Services	591	589	593
5 Wall Street
Burlington, MA 01803
Ascensus, Inc.	Commercial Services & Supplies	938	935	941
200 Dryden Road
Dresher, PA 19025
Asurion, LLC	Commercial Services & Supplies	1,955	1,956	1,962
648 Grassmere Park Drive
Nashville, TN 37211

50

	Industry	Par Amount	Cost	Fair Value
BJ's Wholesale Club, Inc.	Food & Staples Retailing	1,479	1,480	1,480
25 Research Drive
Westborough, MA 01581
Blackboard Inc.	Software	2,448	2,448	2,442
650 Massachusetts Avenue N.W.
65th Floor
Washington, D.C. 20001
Blue Coat Holdings, Inc.	Communications Equipment	2,000	2,001	1,999
420 North Mary Avenue
Sunnyvale, CA 94085
BWay Intermediate Company, Inc.	Containers & Packaging	2,970	2,945	2,979
1515 W. 22nd Street
Suite 550
Oak Brook, IL 60523
Calceus Acquisition, Inc.	Textiles, Apparel & Luxury Goods	2,349	2,358	2,265
6 Ashley Drive
Scarbourough, ME 04174
Camp International Holding Company	Transportation Infrastructure	1,970	1,994	1,976
999 Marconi Avenue
Ronkonkoma, NY 11779
Carecore National, LLC	Health Care Providers & Services	2,057	2,057	2,068
4000 Buckwalter Place Boulevard
Bluffton, SC 29910
CCM Merger Inc.	Hotels, Restaurants & Leisure	916	910	920
2901 Grand River Avenue
Detroit, MI 48201
CDRH Parent, Inc.	Health Care Providers & Services	990	986	989
5220 Belfort Road
Suite 130
Jacksonville, FL 32256
Checkout Holding Corp.	Media	2,475	2,473	2,197
200 Carillon Parkway
St. Petersburg, FL 33716
CityCenter Holdings, LLC	Hotels, Restaurants & Leisure	1,819	1,829	1,824
3730 Las Vegas Blvd. South
Las Vegas, NV 89109
Compuware Corporation	Software	2,987	2,915	2,925
1 Campus Martius
Detroit, MI 48226
Concentra Inc.	Health Care Providers & Services	909	907	909
5080 Spectrum Drive
Suite 1200W
Addison, TX 75001
Connolly, LLC	Professional Services	1,116	1,107	1,121
50 Danbury Road
Wilton, CT 06987
CPG International Inc.	Building Products	1,948	1,948	1,937
888 North Keyser Avenue
Scranton, PA 18504
CPI Buyer, LLC	Trading Companies & Distributors	993	979	993
625 East Bunker Court
Vernon Hills, IL 60654
CT Technologies Intermediate Holdings, Inc.	Health Care Technology	500	498	503
925 North Point Parkway
Suite 350
Alpharetta, GA 30005
DAE Aviation Holdings, Inc.	Aerospace & Defense	1,223	1,234	1,226
110-1524 West 14th Street
Tempe, AZ 85281
Dell International LLC	Technology Hardware, Storage & Peripherals	2,500	2,509	2,504
One Dell Way
Round Rock, TX 78682

51

	Industry	Par Amount	Cost	Fair Value
Deltek, Inc.	Software	2,940	2,933	2,947
2291 Wood Oak Drive
Herndon, VA 20171
Dole Food Company, Inc.	Food Products	2,556	2,551	2,563
One Dole Drive
Westlake Village, CA 91362
Dollar Tree, Inc.	Multiline Retail	418	416	418
500 Volvo Pkwy
Chesapeake, VA 23320
Duff & Phelps Corporation	Capital Markets	3,439	3,441	3,444
55 East 52nd Street
Floor 31
New York, NY 10055
DynCorp International Inc.	Aerospace & Defense	2,189	2,194	2,138
3190 Fairview Park Drive
Number 900
Falls Church, VA 22042
Electrical Components International, Inc.	Electrical Equipment	1,980	1,985	1,996
One City Place Drive
Suite 450
St. Louis, MO 63141
Emerald Expositions Holding, Inc.	Media	2,637	2,658	2,637
31910 Del Obispo Street
San Juan Capistrano, CA 92675
Epicor Software Corporation	Software	1,000	998	999
804 Las Cimas Parkway
Austin, TX 78746
eResearchTechnology, Inc.	Life Sciences Tools & Services	1,000	995	998
685 Rte 202/206
Bridgewater, NJ 08807
Evergreen Acqco 1 LP	Multiline Retail	629	631	590
11400 S.E. 6th Street
Suite 220
Bellevue, WA 98004
EWT Holdings III Corp.	Machinery	985	981	984
4800 North Point Parkway
Suite 250
Alpharetta, GA 30022
Expro Finservices S.à r.l.	Energy Equipment & Services	1,985	1,958	1,762
46A, avenue John F. Kennedy
Luxembourg, 1016
Fairmount Minerals, Ltd.	Metals & Mining	2,948	2,961	2,803
8834 Mayfield Road
Chesterland, OH 44026
Filtration Group Corporation	Industrial Conglomerates	1,000	1,000	1,002
500 W. Madison
Chicago, IL 60661-1416
Fitness International, LLC	Hotels, Restaurants & Leisure	1,295	1,284	1,247
3161 Michelson Drive
Suite 600
Irvine, CA 92612
Gates Global LLC	Machinery	1,496	1,494	1,476
1551 Wewatta Street
Denver, CO 80202
Generic Drug Holdings, Inc.	Pharmaceuticals	1,484	1,478	1,487
31778 Enterprise Drive
Livonia, MI 48150
Global Tel*Link Corporation	Diversified Telecommunication Services	1,694	1,668	1,660
12021 Sunset Hills Road
Suite 100
Reston, VA 20190

52

	Industry	Par Amount	Cost	Fair Value
HGIM Corp.	Marine	1,474	1,478	1,196
701 Polyndras Street
Suite 3700
New Orleans, LA 70139
Hyland Software, Inc.	Software	2,345	2,335	2,354
28500 Clemens Road
Westlake, OH 44145
Hyland Software, Inc.	Software	149	148	149
28500 Clemens Road
Westlake, OH 44145
Immucor, Inc.	Health Care Equipment & Supplies	990	997	995
3130 Gateway Drive
Norcross, GA 30091
Indra Holdings Corp.	Textiles, Apparel & Luxury Goods	1,238	1,227	1,200
9655 International Boulevard
Cincinnati, OH 45246
Informatica Corporation	Software	2,000	1,995	1,999
125 Park Avenue
#1510
New York, NY 10017
Information Resources, Inc.	Professional Services	1,965	1,977	1,978
150 North Clinton Street
Chicago, IL 60661
Inmar, Inc.	Commercial Services & Supplies	1,980	1,964	1,960
2601 Pilgrim Court
Winston-Salem, NC 27106
Houston, TX 77042
Interactive Data Corporation	Media	1,980	1,999	1,989
32 Crosby Drive
Bedford, MA 01730
Ion Media Networks, Inc.	Media	1,975	1,986	1,982
301 Clearwater Park Road
West Palm Beach, FL 33401
IPC Corp.	Software	1,496	1,489	1,491
3 Second Street Plaza 10
15th Floor
Jersey City, NJ 07311
J.C. Penney Corporation, Inc.	Multiline Retail	1,489	1,486	1,489
6501 Legacy Drive (at Corporate Drive)
Plano, TX 75024
Jazz Acquisition, Inc.	Aerospace & Defense	1,981	1,985	1,969
1625 N 1100 W
Springville, UT 84663
Key Safety Systems, Inc.	Auto Components	1,489	1,482	1,497
7000 Nineteen Mile Rd.
Sterling Heights, MI 48314
La Frontera Generation, LLC	Independent Power & Renewable Electricity Producers	1,829	1,839	1,818
7000 Universe Boulevard
Juno Beach, FL 33408
Landmark Aviation FBO Canada, Inc.	Aerospace & Defense	76	76	75
1500 CityWest Blvd.
Suite 600
Houston, TX 77042
Landslide Holdings, Inc.	Software	986	982	986
698 West 10000 South
South Jordan, UT 84095
Learning Care Group (US) No. 2 Inc.	Diversified Consumer Services	1,021	1,021	1,026
21333 Haggerty Road
Suite 300
Novi, MI 48375

53

	Industry	Par Amount	Cost	Fair Value
Leonardo Acquisition Corp.	Internet & Catalog Retail	2,940	2,950	2,937
66 E. Wadsworth Park Drive
Draper, UT 84020
Life Time Fitness, Inc.	Hotels, Restaurants & Leisure	500	498	497
2902 Corporate Place
Chanhassen, MN 55317
LM U.S. Member LLC	Aerospace & Defense	1,904	1,913	1,895
1500 CityWest Blvd.
Suite 600
Houston, TX 77042
Millennium Health, LLC	Health Care Providers & Services	947	939	397
16981 Via Tazon
San Diego, CA 92127
Mitchell International, Inc.	Software	2,915	2,928	2,916
6220 Greenwich Drive
San Diego, CA 92127
Moneygram International, Inc.	IT Services	605	571	578
2828 N. Harwood St.
15th Floor
Dallas, TX 75201
National Financial Partners Corp.	Insurance	2,479	2,494	2,478
340 Madison Avenue
20th Floor
New York, NY 10173
New Albertson's, Inc.	Food & Staples Retailing	997	1,002	1,001
250 Parkcenter Boulevard
Boise, ID 83706
Onex Carestream Finance LP	Health Care Equipment & Supplies	1,756	1,762	1,757
150 Verona Street
Rochester, NY 14608
Opal Acquisition, Inc.	Health Care Providers & Services	2,946	2,927	2,905
20 Waterview Boulevard
Parsippany, NJ 07054
Ortho-Clinical Diagnostics S.A.	Health Care Providers & Services	1,980	1,978	1,945
1001 U.S. 202
Raritan, NJ 08869
P2 Lower Acquisition, LLC	Health Care Providers & Services	2,014	2,008	2,021
1221 Lamar
Suite 1400
Houston, TX 77010
Par Pharmaceutical Companies, Inc.	Pharmaceuticals	995	992	996
300 Tice Boulevard
Woodcliff Lake, NJ 07677
Peabody Energy Corporation	Oil, Gas & Consumable Fuels	995	899	839
701 Market St.
St. Louis, MO 63101
PetSmart, Inc.	Specialty Retail	1,000	995	999
19601 North 27th Avenue
Phoenix, AZ 85027
Pharmedium Healthcare Corporation	Pharmaceuticals	2,358	2,370	2,344
Two Conway Park
150 North Field Drive
Lake Forest, IL 60045
Phillips-Medisize Corporation	Health Care Equipment & Supplies	1,214	1,213	1,218
1201 Hanley Road
Hudson, WI 54016
Presidio, Inc.	IT Services	1,347	1,347	1,352
One Penn Plaza
New York, NY 10119

54

	Industry	Par Amount	Cost	Fair Value
Quikrete Holdings, Inc.	Constructions Materials	2,836	2,847	2,841
3490 Piedmont Road
Suite 1300
Atlanta, GA 30305
RCHP, Inc.	Health Care Providers & Services	1,980	1,965	1,975
103 Continental Place
Suite 200
Brentwood, TN 37027
Renaissance Learning, Inc.	Software	1,975	1,974	1,954
2911 Peach Street
P.O. Box 8036
Wisconsin Rapids, WI 54495
RGIS Services, LLC	Commercial Services & Supplies	2,947	2,935	2,753
2000 East Taylor Road
Auburn Hills, MI 48326
Riverbed Technology, Inc.	Communications Equipment	998	993	1,009
680 Folsom Street
San Francisco, CA 94107
Scientific Games International, Inc.	Hotels, Restaurants & Leisure	993	984	993
750 Lexington Avenue
New York, NY 10022
Sears Roebuck Acceptance Corp.	Multiline Retail	992	978	981
333 Beverly Road
Hoffman Estates, IL 60179
Securus Technologies Holdings, Inc.	Diversified Telecommunication Services	1,895	1,871	1,849
14651 Dallas Parkway
Suite 600
Dallas, TX 75254
Spin Holdco Inc.	Diversified Consumer Services	2,955	2,956	2,950
303 Sunnyside Boulevard
Suite 70
Plainview, NY 11803
Standard Aero Limited	Aerospace & Defense	553	558	554
110-1524 West 14th Street
Tempe, AZ 85281
Sterigenics-Nordion Holdings, LLC	Life Sciences Tools & Services	1,091	1,088	1,091
3 Parkway North Center
Suite 100N
Deerfield, IL 60019
STS Operating, Inc.	Trading Companies & Distributors	1,975	1,986	1,975
2301 Windsor Court
Addison, IL 60101
Surgery Center Holdings, Inc.	Health Care Providers & Services	1,990	1,981	1,994
5501 W. Gray Street
Tampa, FL 33609
Syniverse Holdings, Inc.	Wireless Telecommunication Services	1,500	1,464	1,419
8125 Highwood Way
Tampa, FL 33647
Thermasys Corp.	Machinery	709	710	709
2777 Walden Avenue
Buffalo, NY 14225
TPF II LC, LLC	Independent Power & Renewable Electricity Producers	995	988	1,005
14302 FNB Parkway
Omaha, NE 68154
Trans Union LLC	Professional Services	997	995	991
2 Baldwin Place
P.O. Box 1000
Chester, PA 19022
Travelport Finance (Luxembourg) S.à r.l.	Internet Software & Services	1,990	1,968	1,997
2 Rue Eugene Ruppert
Luxembourg 2453

55

	Industry	Par Amount		Cost		Fair Value
Turbocombustor Technology, Inc.	Aerospace & Defense	3,448		3,421		3,422
3651 S.E. Commerce Avenue
Stuart, FL 34997
Tyche Holdings, LLC	IT Services	1,841		1,835		1,841
515 SW 1st Ave
Fort Lauderdale, FL 33301
Univision Communications Inc.	Media	1,496		1,497		1,486
605 3rd Avenue
New York, NY 10158
USI, Inc.	Insurance	1,965		1,980		1,967
555 Pleasantville Road
Suite 160 South
Briarcliff Manor, NY 10510
USIC Holdings, Inc.	Construction & Engineering	1,463		1,468		1,459
13085 Hamilton Crossing Blvd.
Suite 200
Indianapolis, IN 46032
William Morris Endeavor Entertainment, LLC	Media	1,975		1,973		1,975
9601 Wilshire Boulevard
Beverly Hills, CA 90210
WP CPP Holdings, LLC	Aerospace & Defense	2,947		2,942		2,949
4200 West Valley
Pomona, CA 91766
Total First Lien Floating Rate Loans		$	192,921	$	192,480	$	190,427
Second Lien Floating Rate Loans
Accellent Inc.	Health Care Equipment & Supplies	$	1,500	$	1,497	$	1,441
100 Fordham Road
Wilmington, MA 01887
Advantage Sales & Marketing Inc.	Professional Services	1,000		993		1,008
18100 Von Karman
Ste 900
Irvine, CA 92612
Ameriforge Group Inc.	Energy Equipment & Services	500		500		420
13770 Industrial Road
Houston, TX 77015
Applied Systems, Inc.	Software	980		974		985
200 Applied Parkway
University Park, IL 60484
Asurion, LLC	Commercial Services & Supplies	1,000		988		1,018
648 Grassmere Park Drive
Nashville, TN 37211
Camp International Holding Company	Transportation Infrastructure	1,000		1,000		1,005
999 Marconi Avenue
Ronkonkoma, NY 11779
Checkout Holding Corp.	Media	1,000		1,003		743
200 Carillon Parkway
St. Petersburg, FL 33716
Connolly, LLC	Professional Services	1,250		1,239		1,258
50 Danbury Road
Wilton, CT 06987
Del Monte Foods, Inc.	Food Products	1,500		1,499		1,366
One Maritime Plaza
San Francisco, CA 94111
Drew Marine Group Inc.	Chemicals	1,000		998		990
100 South Jefferson Road
Whippany, NJ 07981
EWT Holdings III Corp.	Machinery	1,000		996		988
4800 North Point Parkway
Suite 250
Alpharetta, GA 30022

56

	Industry	Par Amount		Cost		Fair Value
Filtration Group Corporation	Industrial Conglomerates	126		125		127
500 W. Madison
Chicago, IL 60661
Jazz Acquisition, Inc.	Aerospace & Defense	1,250		1,256		1,216
1625 N 1100 W
Springville, UT 84663
Jonah Energy LLC	Oil, Gas & Consumable Fuels	500		494		477
756 Mulberry Avenue
Suite 450
San Antonio, TX 78212
Landslide Holdings, Inc.	Software	1,000		994		970
698 West 10000 South
South Jordan, UT 84095
P2 Lower Acquisition, LLC	Health Care Providers & Services	500		498		500
1221 Lamar
Suite 1400
Houston, TX 77010
Performance Food Group, Inc.	Food & Staples Retailing	2,947		2,934		2,962
12500 West Creek Parkway
Richmond, VA 21238
Prescrix, Inc.	Containers & Packaging	833		826		836
20 Avenue de la Gare
La Verpilliere, France 38290
Ranpak Corp.	Containers & Packaging	1,375		1,374		1,378
7990 Auburn Road
Concord Township, OH 44077
Road Infrastructure Investment, LLC	Chemicals	2,000		2,008		1,898
115 Todd Court
Thomasville, NC 27360
Sedgwick Claims Management Services, Inc.	Insurance	2,000		1,992		1,968
1100 Ridgeway Loop Road
Memphis, TN 38120
Solenis International, L.P.	Chemicals	500		498		485
8145 Blazer Drive
Wilmington, DE 19808
TWCC Holding Corp.	Media	2,000		1,992		1,872
300 Interstate Parkway SE
Atlanta, GA 30339
Tyche Holdings, LLC	IT Services	1,500		1,501		1,509
515 SW 1st Ave
Fort Lauderdale, FL 33301
WP CPP Holdings, LLC	Aerospace & Defense	493		502		495
4200 West Valley
Pomona, CA 91766
Total Second Lien Floating Rate Loans		$	28,755	$	28,681	$	27,914
Collateralized Loan Obligations
Apidos CLO XIV, Income Notes due 2025		$	5,900	$	4,940	$	4,997
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Apidos CLO XVIII, Income Notes due 2026		2,500		2,045		2,021
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Ares XXIX CLO Ltd., Subordinated Notes due 2026		4,750		4,145		3,985
c/o Appleby Trust (Cayman) Ltd.
P.O. Box 1350
Clifton House, 75 Fort Street
Grand Cayman, Cayman Islands, KY1-1108

57

	Industry	Par Amount	Cost	Fair Value
Avery Point II CLO, Income Notes due 2025		3,200	2,550	2,384
c/o Intertrust SPV (Cayman) Limited
190 Elgin Avenue, George Town
Grand Cayman, Cayman Islands, KY1-1108
Babson 2015-1, Income Notes due 2027		2,500	2,257	2,198
c/o MapleFS Limited
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Blue Hill CLO, Ltd., Subordinated Notes and Subordinated Fee Notes due 2026		5,499	4,598	3,945
c/o Appleby Trust (Cayman) Ltd.
P.O. Box 1350
Clifton House, 75 Fort Street
Grand Cayman, Cayman Islands, KY1-1108
Betony CLO, Ltd., Subordinated Notes due 2027		2,500	2,227	2,202
c/o MapleFS Limited
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Cent CLO 18 Limited, Subordinated Notes due 2025		4,675	3,804	3,490
c/o MaplesFS Limited
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Cent CLO 19 Limited, Subordinated Notes due 2025		2,750	2,301	2,090
c/o MaplesFS Limited
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Dryden 30 Senior Loan Fund, Subordinated Notes due 2025		2,500	1,802	1,841
P.O. Box 1093, Queensgate House
Grand Cayman, Cayman Islands, KY1-1102
Dryden 31 Senior Loan Fund, Subordinated Notes due 2026		5,250	4,354	3,913
P.O. Box 1093, Queensgate House
Grand Cayman, Cayman Islands, KY1-1102
Galaxy XVI CLO, Ltd., Subordinated Notes due 2025		2,750	2,231	2,054
P.O. Box 1093, Queensgate House
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Halcyon Loan Advisors Funding 2014-1 Ltd, Subordinated Notes due 2026		3,750	3,235	3,222
c/o MaplesFS Limited
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Highbridge Loan Management 2013-2, Ltd., Subordinated Notes due 2024		1,000	792	824
c/o MaplesFS Limited
P.O. Box 1093
Boundary Hall, Cricket Square
Grand Cayman, Cayman Islands, KY1-1102
Magnetite VIII, Limited, Subordinated Notes due 2026		3,000	2,731	2,630
c/o Intertrust SPV (Cayman) Limited
190 Elgin Avenue, George Town
Grand Cayman, Cayman Islands, KY1-9005
Neuberger Berman CLO XV, Ltd., Subordinated Notes due 2025		3,410	2,603	2,578
c/o Intertrust SPV (Cayman) Limited
190 Elgin Avenue, George Town
Grand Cayman, Cayman Islands, KY1-9005
Octagon Investment Partners XX, Ltd., Subordinated Notes due 2026		2,500	2,244	2,177
c/o MaplesFS Limited
PO Box 1093
Boundary Hall, Cricket Square
Grand Cayman Cayman Islands, KY1-1102

58

	Industry	Par Amount		Cost		Fair Value
Octagon Investment Partners XIV, Ltd., Income Notes due 2024		5,500		4,257		4,043
c/o MaplesFS Limited
PO Box 1093
Boundary Hall, Cricket Square
Grand Cayman Cayman Islands, KY1-1102
THL Credit Wind River 2014-1 CLO Ltd., Subordinated Notes due 2026		4,000		3,406		3,257
c/o MaplesFS Limited
PO Box 1093
Boundary Hall, Cricket Square
Grand Cayman Cayman Islands, KY1-1102
Total Collateralized Loan Obligations		$	67,934	$	56,519	$	53,850
Total Investments		$	289,610	$	277,680	$	272,191

PORTFOLIO COMPANIES

The following table sets forth certain information as of December 31, 2014 (dollars in thousands), regarding each portfolio company in which we have an investment. All such investments have been made in accordance with our investment objective and strategies described in this prospectus. As of December 31, 2014, none of our investments exceeded 5% of our total assets. Our investments may be prepaid or our Manager may decide that it is in our best interests to sell an investment in the ordinary course of business.  We expect to reinvest any cash proceeds from such events in new investments in accordance with our investment strategy. 

	Industry	Par Amount		Cost		Fair Value
NON-CONTROLLED/NON-AFFILIATED INVESTMENTS
First Lien Floating Rate Loans
24 Hour Fitness Worldwide, Inc.	Hotels, Restaurants & Leisure	$	2,178	$	2,171	$	2,095
12647 Alcosta Boulevard #500 San Ramon, CA 94583
Accellent, Inc.	Health Care Equipment & Supplies	1,985		1,985		1,947
100 Fordham Road Wilmington, MA 01887
Acosta Holdco, Inc.	Media	2,500		2,482		2,504
600 Corporate Center Parkway Jacksonville, FL 32216
Aegis Toxicology Sciences Corporation	Health Care Providers & Services	1,658		1,648		1,662
515 Great Circle Road Nashville, TN 37228
Albertson’s LLC	Food & Staples Retailing	1,000		986		1,002
250 Parkcenter Boulevard Boise, ID 83706
American Tire Distributors, Inc.	Distributors	1,489		1,489		1,493
12200 Herbert Wayne Court Suite 150 Huntersville, NC 28070
AmWINS Group, LLC	Insurance	2,964		2,980		2,948
4725 Piedmont Row Drive Suite 600 Charlotte, NC 28210
Aquilex LLC	Commercial Services & Supplies	1,980		1,976		1,943
3344 Peachtree Road Suite 2100 Atlanta, GA 30305
ARG IH Corporation	Hotels, Restaurants & Leisure	2,475		2,485		2,472
1180 Peachtree Street NE Suite 2500 Atlanta, GA 30309
Aristocrat Leisure Limited	Hotels, Restaurants & Leisure	1,500		1,485		1,478
85 Epping Road Building A, Pinnacle Office Park North Ryde, NSW 2113
Ascend Learning, LLC	Diversified Consumer Services	596		593		593
5 Wall Street Burlington, MA 01803
Ascensus, Inc.	Commercial Services & Supplies	990		986		986
200 Dryden Road Dresher, PA 19025

59

	Industry	Par Amount		Cost		Fair Value
Aspen Dental Management, Inc.	Health Care Providers & Services	987		981		990
281 Sanders Creek Parkway East Syracuse, NY 13057
Asurion, LLC	Commercial Services & Supplies	1,970		1,972		1,948
648 Grassmere Park Drive Nashville, TN 37211
Atlantic Power Limited Partnership	Independent Power & Renewable Electricity Producers	821		818		810
One Federal Street 30th Floor Boston, MA 02110
BJ’s Wholesale Club, Inc.	Food & Staples Retailing	1,485		1,486		1,461
25 Research Drive Westborough, MA 01581
Blackboard Inc.	Software	$	2,460	$	2,461	$	2,442
650 Massachusetts Avenue N.W. 6th Floor Washington, DC 20001
BWay Intermediate Company, Inc.	Containers & Packaging	2,985		2,957		2,981
1515 W. 22nd Street Suite 550 Oak Brook, IL 60523
Calceus Acquisition, Inc.	Textiles, Apparel & Luxury Goods	2,963		2,975		2,875
6 Ashely Drive Scarborough, ME 04174
Camp International Holding Company	Transportation Infrastructure	1,980		2,007		1,985
999 Marconi Avenue Ronkonkoma, NY 11779
Caraustar Industries, Inc.	Containers & Packaging	742		736		738
5000 Austell Powder Springs Road Southwest Austell, GA 20106
Carecore National, LLC	Health Care Providers & Services	2,068		2,067		2,050
4000 Buckwalter Place Boulevard Bluffton, SC 29910
CCM Merger Inc.	Hotels, Restaurants & Leisure	977		970		967
2901 Grand River Avenue Detroit, MI 48201
CDRH Parent, Inc.	Health Care Providers & Services	1,496		1,500		1,478
5220 Belfort Road Suite 130 Jacksonville, FL 32256
Checkout Holding Corp.	Media	2,488		2,486		2,379
200 Carillon Parkway St. Petersburg, FL 33716
Citadel Plastics Holdings, LLC	Chemicals	750		743		744
1600 Powis Court West Chicago, IL 60185
CityCenter Holdings, LLC	Hotels, Restaurants & Leisure	1,819		1,830		1,807
3730 Las Vegas Blvd. South Las Vegas, NV 89109
Connolly, LLC	Professional Services	1,493		1,479		1,482
50 Danbury Road Wilton, CT 06987
CPG International Inc.	Building Products	2,958		2,959		2,921
888 North Keyser Avenue Scranton, PA 18504
CPI Buyer, LLC	Trading Companies & Distributors	998		983		983
625 East Bunker Court Vernon Hills, IL 60654
DAE Aviation Holdings, Inc.	Aerospace & Defense	1,362		1,376		1,362
110-1524 West 14th Street Tempe, AZ 85281
Deltek, Inc.	Software	2,962		2,971		2,934
2291 Wood Oak Drive Herndon, VA 20171
Dole Food Company, Inc.	Food Products	3,637		3,630		3,603
One Dole Drive Westlake Village, CA 91362
DPX Holdings B.V.	Life Sciences Tools & Services	1,990		1,986		1,937
4721 Emperor Boulevard Suite 200 Durham, NC 27703
DTZ U.S. Borrower LLC	Real Estate Management & Development	1,250		1,231		1,250
1209 Orange St. Wilmington, DE 19801
Duff & Phelps Corporation	Capital Markets	3,456		3,458		3,424
55 East 52nd Street Floor 31 New York, NY 10055

60

	Industry	Par Amount		Cost		Fair Value
Dyncorp International	Aerospace & Defense	2,189		2,196		2,186
3190 Fairview Park Drive Number 900 Falls Church, VA 22042
Electrical Components International, Inc.	Electrical Equipment	$	1,990	$	1,995	$	1,994
One City Place Drive Suite 450 St. Louis MO 63141
Emerald Expositions Holding, Inc.	Media	2,748		2,771		2,702
31910 Del Obispo Street San Juan Capistrano, CA 92675
Evergreen Acqo 1 LP	Multiline Retail	1,995		2,002		1,935
11400 S.E. 6th Street Suite 220 Bellevue, WA 98004
EWT Holdings III Corp.	Machinery	990		986		974
4800 North Point Parkway Suite 250 Alpharetta, GA 30022
Exgen Renewables I, LLC	Independent Power & Renewable Electricity Producers	1,408		1,413		1,415
10 South Dearborn St. 48th Floor Chicago, IL 50266
Expro Finservices S.à r.l.	Energy Equipment & Services	1,995		1,966		1,646
46A, avenue John F. Kennedy Luxembourg, 1016
Fairmount Minerals, Ltd.	Metals & Mining	2,963		2,978		2,701
8834 Mayfield Road Chesterland, OH 44026
Fitness International, LLC	Hotels, Restaurants & Leisure	1,301		1,289		1,249
3161 Michelson Drive Suite 600 Irvine, CA 92612
Global Tel*Link Corporation	Diversified Telecommunications Services	1,704		1,675		1,691
12021 Sunset Hills Road Suite 100 Reston, VA 20190
Great Wolf Resorts, Inc.	Hotels, Restaurants & Leisure	2,962		2,969		2,946
525 Junction Road Suite 6000 South Tower Madison, WI 53717
Greeneden U.S. Holdings II, LLC	Software	1,980		1,971		1,965
2001 Junipero Serra Blvd. Daly City, CA 94014
HGIM Corp.	Marine	1,481		1,486		1,204
701 Poydras Street Suite 3700 New Orleans, LA 70139
Hyland Software, Inc.	Software	1,355		1,349		1,346
28500 Clemens Road Westlake, OH 44145
Ikaria, Inc.	Health Care Providers & Services	2,504		2,509		2,498
53 Frontage Road P.O. Box 9001 Hampton, NJ 08827
Immucor, Inc.	Health Care Equipment & Supplies	995		1,003		985
3130 Gateway Drive Norcross, GA 30091
Indra Holdings Corp.	Textiles, Apparel & Luxury Goods	1,244		1,232		1,231
9655 International Boulevard Cincinnati, OH 45246
Information Resources, Inc.	Professional Services	1,975		1,988		1,970
150 North Clinton Street Chicago, IL 60661-1416
Inmar, Inc.	Commercial Services & Supplies	1,990		1,973		1,938
2601 Pilgrim Court Winston-Salem, NC 27106
Interactive Data Corporation	Media	1,990		2,011		1,981
32 Crosby Drive Bedford, MA 01730
Ion Media Networks, Inc.	Media	1,985		1,997		1,965
301 Clearwater Park Road West Palm Beach, FL 33401
J.C. Penney Corporation, Inc.	Multiline Retail	1,496		1,493		1,442
6501 Legacy Drive (at Corporate Drive) Plano, TX 75024

61

	Industry	Par Amount		Cost		Fair Value
Jazz Acquisition, Inc.	Aerospace & Defense	$	1,990	$	1,995	$	1,975
1625 N 1100 W Springville, UT 84663
Key Safety Systems, Inc.	Auto Components	1,496		1,489		1,489
7000 Nineteen Mile Rd Sterling Heights, MI 48314
La Frontera Generation, LLC	Independent Power & Renewable Electricity Producers	1,839		1,850		1,817
7000 Universe Boulevard Juno Beach, FL 33408
Landmark Aviation FBO Canada, Inc.	Aerospace & Defense	76		76		75
1500 CityWest Blvd. Suite 600 Houston, TX 77042
Landslide Holdings, Inc.	Software	993		988		978
698 West 10000 South South Jordan, UT 84095
Learning Care Group (US) No. 2 Inc.	Diversified Consumer Services	1,026		1,022		1,018
21333 Haggerty Road Suite 300 Novi, MI 48375
Leonardo Acquisition Corp.	Internet & Catalog Retail	2,978		2,989		2,901
66 E. Wadsworth Park Drive Draper, UT 84020
LM U.S. Member LLC	Aerospace & Defense	1,914		1,923		1,900
1500 CityWest Blvd Suite 600 Houston, TX 77042
Millennium Health, LLC	Health Care Providers & Services	1,197		1,186		1,194
16981 Via Tazon San Diego, CA 92127
Mitchell International, LLC	Software	2,977		2,992		2,943
6220 Greenwich Drive San Diego, CA 92122
Murray Energy Corporation	Oil, Gas & Consumable Fuels	2,977		2,965		2,875
46226 National Road W. St. Clairsville, OH 43950
National Financial Partners Corp.	Insurance	2,491		2,508		2,473
340 Madison Avenue 20th Floor New York, NY 10173
Onex Carestream Finance LP	Health Care Equipment & Supplies	1,858		1,865		1,854
150 Verona Street Rochester, NY 14608
Opal Acquisition, Inc.	Health Care Providers & Services	2,970		2,949		2,948
20 Waterview Boulevard Parsippany, NJ 07054
Ortho-Clinical Diagnostics Holdings Luxembourg S.À R.L.	Health Care Providers & Services	1,990		1,987		1,962
1001 U.S. 202 Raritan, NJ 08869
OSG Bulk Ships, Inc.	Oil, Gas & Consumable Fuels	1,492		1,479		1,459
666 3rd Avenue New York, NY 10017
OSG International, Inc.	Oil, Gas & Consumable Fuels	1,492		1,479		1,455
666 3rd Avenue New York, NY 10017
P2 Lower Acquisition, LLC	Health Care Providers & Services	2,112		2,106		2,091
1221 Lamar Suite 1400 Houston, TX 77010
Pharmedium Healthcare Corporation	Pharmaceuticals	2,370		2,383		2,307
Two Conway Park 150 North Field Drive Lake Forest, IL 60045
Phillips-Medisize Corporation	Health Care Equipment & Supplies	1,221		1,219		1,205
1201 Hanley Road Hudson, WI 54016
PRA Holdings, Inc.	Life Sciences Tools & Services	1,638		1,638		1,620
4130 Park Avenue Suite 400 Raleigh, NC 27612

62

	Industry	Par Amount		Cost		Fair Value
Quikrete Holdings, Inc.	Constructions Materials	$	2,836	$	2,848	$	2,803
3490 Piedmont Road Suite 1300 Atlanta, GA 30305
RCHP, Inc.	Health Care Providers & Services	1,990		1,973		1,980
103 Continental PLace Suite 200 Brentwood, TN 37027
Renaissance Learning, Inc.	Software	1,985		1,983		1,947
2911 Peach Street P.O. Box 8036 Wisconsin Rapids, WI 54495
RGIS Services, LLC	Commercial Services & Supplies	2,962		2,948		2,718
2000 East Taylor Road Auburn Hills, MI 48326
Scientific Games International Inc.	Hotels, Restaurants & Leisure	2,000		1,981		1,976
750 Lexington Avenue New York, NY 10022
Sears Roebuck Acceptance Corp.	Multiline Retail	997		981		962
333 Beverly Road Hoffman Estates, IL 60179
Securus Technologies Holdings, Inc.	Diversified Telecommunications Services	1,904		1,878		1,885
14651 Dallas Parkway Suite 600 Dallas, TX 75254
Spin Holdco Inc.	Diversified Consumer Services	2,970		2,971		2,929
303 Sunnyside Boulevard Suite 70 Plainview, NY 11803
Standard Aero Limited	Aerospace & Defense	618		624		618
110-1524 West 14th Street Tempe, AZ 85281
STHI Holding Corp.	Life Sciences Tools & Services	1,995		1,986		1,984
3 Parkway North Center Suite 100N Deerfield, IL 60019
STS Operating, Inc.	Trading Companies & Distributors	1,985		1,997		1,955
2301 Windsor Court Addison, IL 60101
Surgery Center Holdings, Inc.	Health Care Providers & Services	2,000		1,990		1,953
5501 W. Gray Street Tampa, FL 33609
Thermasys Corp.	Machinery	1,839		1,843		1,811
2777 Walden Avenue Buffalo, NY 14225
TMS International Corp.	Metals & Mining	2,970		2,976		2,977
12 Monongahela Avenue Glassport, PA 15045
TPF II LC, LLC	Independent Power & Renewable Electricity Producers	1,000		993		1,002
14302 FNB Parkway Omaha, NE 68154
Travelport Finance (Luxembourg) S.à r.l.	Internet Software & Services	2,000		1,976		2,000
2 Rue Eugene Ruppert Luxembourg 2453
Turbocombustor Technology	Aerospace & Defense	3,465		3,435		3,433
3651 S.E. Commerce Avenue Stuart, FL 34997
Tyche Holdings, LLC	IT Services	1,850		1,844		1,843
515 SW 1st Ave Fort Lauderdale, FL 33301
USI, Inc.	Insurance	1,975		1,992		1,947
555 Pleasantville Road Suite 160 South Briarcliff Manor, NY 10510
USIC Holdings, Inc.	Construction & Engineering	1,470		1,476		1,433
13085 Hamilton Crossing Blvd. Suite 200 Indianapolis, IN 46032
Veyance Technologies, Inc.	Machinery	1,496		1,496		1,494
703 S Cleveland Massilon Road Fairlawn, OH 44333

63

	Industry	Par Amount		Cost		Fair Value
Vitera Healthcare Solutions, LLC	Health Care Technology	$	2,228	$	2,212	$	2,216
4301 West Boy Scout Boulevard Tampa, FL 33607
WideOpenWest Finance, LLC	Media	2,975		3,001		2,962
7887 East Belleview Avenue Suite 1000 Englewood, CO 80111
WP CPP Holdings, LLC	Aerospace & Defense	2,962		2,956		2,947
4200 West Valley Pomona, CA 91766
Total First Lien Floating Rate Loans		$	198,221	$	198,028	$	194,952
Accellent, Inc.	Health Care Equipment & Supplies	1,500		1,497		1,421
100 Fordham Road Wilmington, MA 01887
Advantage Sales & Marketing Inc.	Professional Services	1,000		993		992
18100 Von Karman Ste 900 Irvine, CA 92612
Ameriforge Group Inc.	Energy Equipment & Services	500		500		493
13770 Industrial Road Houston, TX 77015
Applied Systems, Inc.	Software	1,000		993		981
200 Applied Parkway University Park, IL 60484
Asurion, LLC	Commercial Services & Supplies	1,000		987		997
648 Grassmere Park Drive Nashville, TN 37211
Camp International Holding Company	Transportation Infrastructure	1,000		1,000		1,005
999 Marconi Avenue Ronkonkoma, NY 11779
Checkout Holding Corp.	Media	1,000		1,003		933
200 Carillon Parkway St. Petersburg, FL 33716
Connolly, LLC	Professional Services	1,250		1,238		1,241
50 Danbury Road Wilton, CT 06987
Del Monte Foods, Inc.	Food Products	1,500		1,499		1,290
One Maritime Plaza San Francisco, CA 94111
Drew Marine Group Inc.	Chemicals	1,000		998		995
100 South Jefferson Road Whippany, NJ 07981
EWT Holdings III Corp.	Machinery	1,000		995		975
4800 North Point Parkway Suite 250 Alpharetta, GA 30022
Filtration Group Corporation	Industrial Conglomerates	500		496		501
500 W. Madison Chicago, IL 60661
Ikaria, Inc.	Health Care Providers & Services	1,000		1,012		987
53 Frontage Road P.O. Box 9001 Hampton, NJ 08827
Inmar, Inc.	Commercial Services & Supplies	750		743		734
2601 Pilgrim Court Winston-Salem, NC 27106
Jazz Acquisition, Inc.	Aerospace & Defense	1,250		1,256		1,223
1625 N 1100 W Springville, UT 84663
Jonah Energy LLC	Oil, Gas & Consumable Fuels	500		493		432
756 Mulberry Avenue Suite 450 San Antonio, TX 78212
Landslide Holdings, Inc.	Software	1,000		993		975
698 West 10000 South South Jordan, UT 84095
P2 Lower Acquisition, LLC	Health Care Providers & Services	500		498		485
1221 Lamar Suite 1400 Houston, TX 77010

64

	Industry	Par Amount		Cost		Fair Value
Performance Food Group, Inc.	Food & Staples Retailing	$	2,963	$	2,947	$	2,914
12500 West Creek Parkway Richmond, VA 21238
Prescrix, Inc.	Containers & Packaging	1,333		1,321		1,325
20 Avenue de la Gare La Verpilliere, France 38290
Ranpak Corp.	Containers & Packaging	1,375		1,374		1,374
7990 Auburn Road Concord Township, OH 44077
Road Infrastructure Investment, LLC	Chemicals	2,000		2,009		1,813
115 Todd Court Thomasville, NC 27360
Sedgwick Claims Management Services, Inc.	Insurance	2,000		1,991		1,895
1100 Ridgeway Loop Road Memphis, TN 38120
Solenis International, L.P.	Chemicals	500		498		487
8145 Blazer Drive Wilmington, DE 19808
TWCC Holding Corp.	Media	2,000		1,991		1,923
300 Interstate Parkway SE Atlanta, GA 30339
Tyche Holdings, LLC	IT Services	500		495		495
515 SW 1st Ave Fort Lauderdale, FL 33301
WP CPP Holdings, LLC	Aerospace & Defense	1,000		1,022		955
4200 West Valley Pomona, CA 91766
Total Second Lien Floating Rate Loans		$	30,921	$	30,842	$	29,841
COLLATERALIZED LOAN OBLIGATIONS
Apidos CLO XIV, Income Notes due 2025		$	5,900	$	5,299	$	5,337
P.O. Box 1093 Boundary Hall, Cricket Square Grand Cayman, Cayman Islands, KY1-1102
Ares XXIX CLO Ltd., Subordinated Notes due 2026		4,750		4,339		4,239
c/o Appleby Trust (Cayman) Ltd. P.O. Box 1350 Clifton House, 75 Fort Street Grand Cayman, Cayman Islands, KY1-1108
Avery Point II CLO, Limited, Income Notes due 2025		3,200		2,764		2,697
c/o Intertrust SPV (Cayman) Limited 190 Elgin Avenue, George Town Grand Cayman, Cayman Islands, KY1-9005
Blue Hill CLO, Ltd., Subordinated Notes and Subordinated Fee Notes due 2026		5,500		4,803		4,679
c/o Appleby Trust (Cayman) Ltd. P.O. Box 1350 Clifton House, 75 Fort Street Grand Cayman, Cayman Islands, KY1-1108
Carlyle Global Market Strategies CLO 2013-3, Ltd., Subordinated Notes due 2025		2,750		2,096		2,311
c/o Intertrust SPV (Cayman) Limited 190 Elgin Avenue, George Town Grand Cayman, Cayman Islands, KY1-9005
Cent CLO 18 Limited, Subordinated Notes due 2025		4,675		4,007		3,940
c/o MaplesFS Limited P.O. Box 1093 Boundary Hall, Cricket Square Grand Cayman, Cayman Islands, KY1-1102
Cent CLO 19 Limited, Subordinated Notes due 2025		2,750		2,402		2,299
c/o MaplesFS Limited P.O. Box 1093 Boundary Hall, Cricket Square Grand Cayman, Cayman Islands, KY1-1102
Dryden 31 Senior Loan Fund, Subordinated Notes due 2026		5,250		4,686		4,187
P.O. Box 1093, Queensgate House Grand Cayman, Cayman Islands, KY1-1102
Galaxy XVI CLO, Ltd., Subordinated Notes due 2025		2,750		2,362		2,259
P.O. Box 1093 Boundary Hall, Cricket Square Grand Cayman, Cayman Islands, KY1-1102

65

	Industry	Par Amount		Cost		Fair Value
Halcyon Loan Advisors Funding 2014-1, Ltd. Subordinated Notes due 2026		$	3,750	$	3,315	$	3,376
c/o MaplesFS Limited P.O. Box 1093 Boundary Hall, Cricket Square Grand Cayman, Cayman Islands, KY1-1102
Highbridge Loan Management 2013-2, Ltd., Subordinated Notes due 2024		1,000		849		838
c/o MaplesFS Limited P.O. Box 1093 Boundary Hall, Cricket Square Grand Cayman, Cayman Islands, KY1-1102
Magnetite VIII, Limited, Subordinated Notes due 2026		3,000		2,911		2,680
c/o Intertrust SPV (Cayman) Limited 190 Elgin Avenue, George Town Grand Cayman, Cayman Islands, KY1-9005
Neuberger Berman CLO XV, Ltd., Subordinated Notes due 2025		3,410		2,786		2,773
c/o Intertrust SPV (Cayman) Limited 190 Elgin Avenue, George Town Grand Cayman, Cayman Islands, KY1-9005
Octagon Investment Partners CLO XIV, Ltd., Subordinated Notes due 2024		5,500		4,571		4,210
c/o MaplesFS Limited PO Box 1093 Boundary Hall, Cricket Square Grand Cayman Cayman Islands, KY1-1102
Octagon Investment Partners XX, Ltd., Subordinated Notes due 2026		2,500		2,482		2,327
c/o MaplesFS Limited PO Box 1093 Boundary Hall, Cricket Square Grand Cayman Cayman Islands, KY1-1102
THL Credit Wind River 2014-1 CLO Ltd., Subordinated Notes due 2026		4,000		3,591		3,425
c/o MaplesFS Limited PO Box 1093 Boundary Hall, Cricket Square Grand Cayman Cayman Islands, KY1-1102
TOTAL COLLATERALIZED LOAN OBLIGATIONS		60,685		53,263		51,577
Total Investments		$	289,827	$	282,133	$	276,370

To include certain securities above as qualifying assets for the purpose of the 70% test, a BDC must either control the issuer of the securities or offer to make significant managerial assistance available to the issuer of those securities, such as providing significant guidance and counsel concerning the management, operations, or business objectives and policies of a portfolio company or making loans to a portfolio company. We intend to offer to make significant managerial assistance available to each of our eligible portfolio companies.

66

SENIOR SECURITIES

Information about our senior securities is shown in the following table as of June 30, 2015 and December 31 for the periods indicated, unless otherwise noted. The “–” indicates information which the SEC expressly does not require to be disclosed for certain types of senior securities. Ernst & Young LLP’s report on the senior securities table as of June 30, 2015, December 31, 2014 and 2013 is attached as an exhibit to this registration statement.

Class and Year	Total Amount Outstanding Exclusive of Treasury Securities (1)		Asset Coverage Per Unit (2)		Involuntary Liquidating Preference Per Unit (3)	Average Market Value Per Unit (4)
Credit Facility
June 30, 2015 (unaudited)	$	123,800	$	2,174	—	N/A
2014	$	130,000	$	2,109	—	N/A
2013	—		N/A		—	N/A
ACAM Facility
2013	$	194,748	$	1,005	—	N/A

(1) Total amount of each class of senior securities outstanding at the end of the period presented. Total amount of each class of senior securities outstanding expressed in terms of dollar amounts per $1,000 of indebtedness.

(2) Asset coverage per unit is the ratio of the carrying value of our total consolidated assets, less all liabilities and indebtedness not represented by senior securities, to the aggregate amount of senior securities representing indebtedness. Asset coverage per unit is expressed in terms of dollar amounts per $1,000 of indebtedness.

(3) The amount to which such class of senior security would be entitled upon the involuntary liquidation of the issuer in preference to any security junior to it.

(4) Not applicable because the senior security is not registered for public trading.

MANAGEMENT

Board of Directors

Our business and affairs are managed under the direction of our Board of Directors, which is currently comprised of three independent directors, Phyllis R. Caldwell, Gil Crawford and Larry K. Harvey, and two affiliated directors, Malon Wilkus and Stan Lundine. The following table sets forth the members of our Board of Directors, their ages and their committee membership, if any, as of October 30, 2015. The address for each director is c/o American Capital Senior Floating, Ltd., 2 Bethesda Metro Center, 14th Floor, Bethesda, MD 20814.

Name	Age	Director Since	Audit and Compliance(1)	Compensation and Corporate Governance(2)
Interested Directors
Malon Wilkus (3)	63	2013
Stan Lundine (3)	76	2014
Disinterested Directors
Phyllis R. Caldwell (4)	56	2014	ü	Chair
Gil Crawford (4)	58	2014	ü	ü
Larry K. Harvey (4)	51	2014	Chair	ü

(1) Each member of the Audit and Compliance Committee is “independent,” as defined in Rules 5605(a)(2) and 5605(c)(2) of The NASDAQ Global Select Market’s marketplace rules (the “NASDAQ rules”) and Rule 10A-3 of the Exchange Act. The Board of Directors has determined that Mr. Harvey is an “audit committee financial expert,” as defined in Item 407 of Regulation S-K under the Securities Act.

(2) Each member of the Compensation and Corporate Governance Committee is “independent,” as defined in Rules 5605(a)(2) and 5605(d)(2) of the NASDAQ rules.

(3) Director is an “Interested Person” of ACSF, as defined in Section 2(a)(19) of the 1940 Act. Mr. Wilkus is an Interested Person because he is an officer of ACSF and a member of the Board of Directors of American Capital. Mr. Lundine is an Interested Person because he is a member of the Board of Directors of American Capital.

(4) Director is “independent,” as defined in Rule 5605(a)(2) of the NASDAQ rules, and is not an “Interested Person” of ACSF, as defined in Section 2(a)(19) of the 1940 Act.

67

Interested Directors

Malon Wilkus has served as our Chair and Chief Executive Officer and as the Chief Executive Officer of our Manager since our incorporation in February 2013. Mr. Wilkus has also served as the Chief Executive Officer of American Capital CLO Management, LLC, the external manager of each of ACAS CLO 2007-1, Ltd., ACAS CLO 2012-1, Ltd., ACAS CLO 2013-1, Ltd., ACAS CLO 2013-2, Ltd., ACAS CLO 2014-1, Ltd., ACAS CLO 2014-2, Ltd. and ACAS CLO 2015-1, Ltd., which also invest in Senior Secured Floating Rate Loans, since July 2013. In addition, Mr. Wilkus is Chief Executive Officer of ACSF Funding I, LLC, ACAS Funding I, LLC and ACAS Funding II, LLC, which invest in Senior Secured Floating Rate Loans. Mr. Wilkus founded American Capital, Ltd. (NASDAQ:ACAS), the indirect owner of our Manager, in 1986 and has served as its Chief Executive Officer and Chairman of the Board of Directors since that time, except for the period from 1997 to 1998 during which he served as Chief Executive Officer and Vice Chairman of the Board of Directors. He also served as President of American Capital from 2001 to 2008 and from 1986 to 1999. Mr. Wilkus has been the Chairman of European Capital Limited, a European private equity and mezzanine fund, since its formation in 2005. In addition, Mr. Wilkus is the Chief Executive Officer and President of American Capital Asset Management, LLC, the asset fund management portfolio company of American Capital and the owner of the parent company of our Manager. He has also served on the board of directors of over a dozen middle-market companies in various industries. Mr. Wilkus is also the Chair and Chief Executive Officer of each of American Capital Agency Corp. (NASDAQ: AGNC) and American Capital Mortgage Investment Corp. (NASDAQ: MTGE). Mr. Wilkus’ extensive board and senior executive experience investing in and managing private and public investment vehicles, and his financial expertise and deep knowledge of our business as our Chief Executive Officer strengthen our Board’s collective qualifications, skills, experience and viewpoints.

Stan Lundine is a former U.S. Congressman and retired attorney and hospital executive. From 1995 to 2008, he served as Of Counsel to the law firm of Sotir and Goldman and as Executive Director of the Chautauqua County Health Network, a consortium of four hospitals. He was also President of the Chautauqua Integrated Delivery System, Inc., a for-profit physician/hospital organization. From 1987 to 1994, Mr. Lundine served as Lieutenant Governor of New York and chairman of several boards and councils. From 1976 until 1987, Mr. Lundine was a Member of Congress serving on the Banking Committee and the Committee on Science and Technology. From 1970 until his election to Congress, Mr. Lundine was Mayor of Jamestown, NY and an executive or board member of various governmental entities and institutions. Mr. Lundine currently serves on the board of directors of American Capital, Ltd. (NASDAQ: ACAS) and has served on the boards of numerous other private and non-profit companies. Mr. Lundine’s extensive legal, board and government service and his experience with corporate governance and executive compensation matters strengthen our Board’s collective qualifications, skills, experience and viewpoints.

Disinterested Directors

Phyllis R. Caldwell is a finance and economic development advisor and former commercial bank executive. Ms. Caldwell was also a senior official at the U.S. Department of the Treasury, responsible for oversight of the U.S. housing market stabilization, economic recovery and foreclosure prevention initiatives established through the Troubled Asset Relief Program, from 2009 to 2011. From 2007 to 2009, Ms. Caldwell was the President of the Washington Area Women’s Foundation. Ms. Caldwell retired from Bank of America in 2007, after working for twenty years in various leadership positions in real estate and affordable housing finance. During her tenure at Bank of America, Ms. Caldwell also managed the bank’s investments in community banks, loan funds and small business venture funds. Ms. Caldwell also serves on the board of directors of Ocwen Financial Corporation (NYSE: OCN) and has served on the boards of numerous non-profit organizations engaged in housing and community development finance. Ms. Caldwell’s extensive experience in banking and finance strengthen our Board’s collective qualifications, skills, experience and viewpoints.

Gil Crawford has spent his career working with finance institutions across the globe on various capital markets transactions. Since co-founding MicroVest Capital Management, LLC in 2003, Mr. Crawford has served as its Chief Executive Officer, responsible for leading MicroVest’s investment operations and strategy. From 2000 to 2002, Mr. Crawford was a Senior Investment Officer in the Latin American Financial Markets Division of the International Finance Corporation. From 1991 to 2000, Mr. Crawford was the founder and Executive Director of Seed Capital Development Fund, Ltd., a U.S. based firm involved in capitalizing start-up institutions primarily in Latin America, Asia and Africa. Mr. Crawford has also served on the boards of several emerging market institutions, including Ecuador, Tunisia, Mongolia and Peru. Mr. Crawford’s extensive finance and capital markets experience strengthen our Board’s collective qualifications, skills, experience and viewpoints.

Larry Harvey has served as Chief Financial Officer of Playa Hotels & Resorts B.V. since April 2015. From 2007 to 2013, he served as Executive Vice President and Chief Financial Officer of Host Hotels & Resorts, Inc. (NYSE: HST) (“Host”) and served as its Treasurer from 2007 to 2010. From 2006 to 2007, Mr. Harvey served as Senior Vice President, Chief Accounting Officer of Host and from 2003 to 2006, he served as Host’s Senior Vice President and Corporate Controller. Prior to rejoining Host in 2003, he served as Chief Financial Officer of Barceló Crestline Corporation, formerly Crestline Capital Corporation. Prior

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to that, Mr. Harvey was Host’s Vice President of Corporate Accounting, before the spin-off of Crestline in 1998. Mr. Harvey also serves on the board of directors of American Capital Agency Corp. (NASDAQ: AGNC) and American Capital Mortgage Investment Corp. (NASDAQ: MTGE). Our Board of Directors has determined that Mr. Harvey is an “audit committee financial expert” (as defined in Item 407 of Regulation S-K under the Securities Act). Mr. Harvey’s public company accounting, finance and risk management expertise, including his extensive experience as a senior executive responsible for the preparation of financial statements, strengthens our Board’s collective qualifications, skills, experience and viewpoints.

Board Leadership Structure

Mr. Wilkus has served as our Chair and Chief Executive Officer since our incorporation in February 2013. We believe that combining the positions of Chair and Chief Executive Officer is the best corporate governance leadership structure for us at this time because it permits clear accountability, effective decision-making and alignment on corporate strategy.

Although we believe that it is more effective for us to combine the positions of Chair and Chief Executive Officer, we recognize the importance of strong independent leadership on the Board. We believe that our Board’s independent oversight continues to be substantial. Our Board of Directors has determined that all of the current directors, except Messrs. Wilkus and Lundine, are “independent” as defined in the NASDAQ rules. Similarly, only Messrs. Wilkus and Lundine are “Interested Persons” of ACSF under the 1940 Act.

It is our Board’s policy as a matter of good corporate governance to have a majority of our directors who are not “Interested Persons” meet regularly without persons who are members of management or employee directors present to facilitate the Board’s effective independent oversight of management. These directors periodically designate a director who is “independent,” as defined in the NASDAQ rules, to serve as the “lead independent director” and preside at these meetings. Presently, our disinterested directors meet during our Board’s quarterly in-person meetings and may hold additional meetings at the request of the lead independent director or another disinterested director. The designation of a lead independent director is generally for a one-year term or until his or her successor is elected, and a lead independent director may be re-appointed at the end of a term. If the lead independent director is unavailable for a meeting, his or her immediate predecessor will serve as lead independent director for such meeting. Mr. Crawford is our current lead independent director.

Each of our Board’s Audit and Compliance Committee and Compensation and Corporate Governance Committee is composed entirely of independent directors. These independent committees of our Board also have the authority under their respective charters to hire independent advisors and consultants, at our expense, to assist them in performing their duties.

Corporate Governance

Our Board of Directors has developed corporate governance practices to help it fulfill its responsibility to stockholders to oversee the work of management in the conduct of our business. The governance practices are memorialized in corporate governance guidelines to assure that the Board will have the necessary authority and practices in place to review and evaluate our business operations as needed and to make decisions that are independent of management. These guidelines, in conjunction with our charter, bylaws and committee charters of the Audit and Compliance Committee and the Compensation and Corporate Governance Committee, form the framework for our governance. All of these documents are available in the Investor Relations section of our web site at www.ACSF.com.

Committees of the Board of Directors

Our Board of Directors’ principal standing committees and their primary functions are described below.

Audit and Compliance Committee

This committee assists the Board of Directors in overseeing:

• our accounting and financial reporting processes;

• the integrity and audits of our financial statements;

• our compliance with legal and regulatory requirements;

• the qualifications and independence of our independent registered public accounting firm; and

• the performance of our independent registered public accounting firm and any internal auditors.

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In addition, the Audit and Compliance Committee reviews and provides a recommendation to the Board of Directors with regard to its approval of the valuations of our investments presented by management. In such review, the committee discusses the proposed valuations with our independent auditors and other relevant consultants. The Audit and Compliance Committee is also responsible for engaging an independent registered public accounting firm, reviewing with the independent registered public accounting firm the plans and results of the audit engagement, approving professional services provided by the independent registered public accounting firm and considering the range of audit and non-audit fees. The committee’s meetings include, whenever appropriate, executive sessions with each of our independent external auditors and our Manager’s internal auditors, without the presence of management.

Compensation and Corporate Governance Committee

This committee’s principal functions are to:

• evaluate the performance of and compensation paid by us, if any, to our executive officers;

• evaluate the performance of our Manager;

• review the compensation and fees payable to our Manager under the management agreement with our Manager (which is described under “Board and Governance Matters-Certain Transactions with Related Persons”);

• decide whether to renew or terminate the management agreement with our Manager;

• evaluate the compensation and fees payable to the members of the Board of Directors;

• administer any equity incentive plans that we may adopt, to the extent it is delegated authority by the Board of Directors;

• review and assist with the development of our executive succession plans; and

• produce a report on executive compensation required to be included in our proxy statement for our annual meetings.

The Compensation and Corporate Governance Committee also serves as the Board of Director’s standing nominating committee and as such performs the following functions:

• identifying, recruiting and recommending to the Board of Directors qualified candidates for election as directors and recommending a slate of nominees for election as directors by our common stockholders at the annual meeting of stockholders;

• developing and recommending to the Board of Directors corporate governance guidelines, including the committee’s selection criteria for director nominees;

• reviewing and making recommendations on matters involving the general operation of the Board of Directors and our corporate governance;

• recommending to the Board of Directors nominees for each committee of the Board of Directors; and

• annually facilitating the assessment of the Board of Directors’ performance as a whole and of the individual directors and reports thereon to the Board of Directors.

Board and Committee Meetings

Under our Bylaws and Maryland law, the Board of Directors is permitted to take actions at regular or special meetings and by written consent. The Board of Directors generally holds regular quarterly meetings and meets on other occasions as necessary. The Board of Directors held eight meetings during 2014, one of which was held to approve the compensation and terms of the management agreement with our Manager. As noted above, the independent directors also met separately in executive sessions to discuss various matters, including our performance and the performance of our Manager.

Each of the Audit and Compliance Committee and the Compensation and Corporate Governance Committee schedules regular meetings to coincide with the quarterly in-person meetings of the Board of Directors and also meets at the request of senior management or at such other times as it determines. Our Secretary, in consultation with the chair of the committee, sets agendas for the meetings. Each committee reports regularly to the Board of Directors on its activities at the next regularly scheduled Board meeting following their committee meetings and when appropriate. During 2014, the Audit and Compliance Committee held four meetings and the Compensation and Corporate Governance Committee held one meeting.

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Each of our directors attended at least 87% of the meetings of the Board of Directors and 100% of the meetings of the committees on which he or she served. Although we do not have a policy on director attendance at the Annual Meeting, directors are encouraged to attend the Annual Meeting.

Risk Oversight

One of the roles of our Board of Directors is being responsible for the general oversight of the Company, including the performance of our executive officers, our Manager and the Company’s risk management processes, to assure that the long-term interests of our stockholders are being served. In performing its risk oversight function, the Board, directly or through its standing committees, regularly reviews our material strategic, operational, financial, compensation and compliance risks with senior management. In particular, the Board receives updates at each regular meeting on the Company’s strategic plan, which addresses, among other things, the risks and opportunities facing us, as well as our investment platforms.

The Board of Directors also recognizes the importance of effective executive leadership to our success and is actively engaged in overseeing the operational risks related to succession planning. The Board of Directors routinely discusses staffing for critical roles, and potential replacements for key personnel are given exposure to the Board of Directors during meetings and other events. In addition, the Board of Directors is regularly updated on the Manager’s strategies for recruiting, developing and retaining outstanding personnel at the Manager and its affiliates, as applicable.

The Board has delegated certain risk management oversight responsibility to its committees as follows:

Regulatory Compliance Risk:  The Board, both directly and through the Audit and Compliance Committee, receives regular reports from our Manager’s legal, accounting and internal audit representatives on regulatory matters, including the Company’s compliance with the BDC qualification and leverage requirements under the Investment Company Act of 1940, compliance with our Code of Ethics and Conduct (“Code of Ethics”) and our Manager’s compliance with the Investment Advisers Act of 1940.

Financial and Accounting Risk:  The Audit and Compliance Committee oversees the Company’s management of its financial, accounting, internal controls and liquidity risks through regular meetings with our Chief Financial Officer, senior representatives of our Manager’s accounting, tax, auditing and legal departments and representatives of the Company’s independent public accountant.

Litigation Risk:  The Compensation and Corporate Governance Committee monitors the Company’s litigation, if any.

Compensation and Benefit Plan Risk:  The Compensation and Corporate Governance Committee considers the extent to which our director compensation and any benefit plan programs that we may adopt may create risk for the Company.

Governance Risk:  The Compensation and Corporate Governance Committee also oversees risks related to Board organization, membership and structure and corporate governance.

Director Nomination Process

Nominations for election to the Board of Directors may be made by the Compensation and Corporate Governance Committee of the Board of Directors, or by any common stockholder entitled to vote for the election of directors. Candidates recommended by common stockholders will be evaluated by the Compensation and Corporate Governance Committee under the same criteria that are applied to other candidates.

Board Membership Criteria

Although there is not a formal list of qualifications, in discharging its responsibilities to nominate candidates for election to the Board of Directors, the Compensation and Corporate Governance Committee endeavors to identify, recruit and nominate candidates based on the following eligibility and experience criteria: a candidate’s integrity and business ethics, strength of character, judgment, experience and independence, as well as factors relating to the composition of the Board of Directors, including its size and structure, the relative strengths and experience of current directors and principles of diversity, including diversity of experience, personal and professional backgrounds, race, gender and age. Although the committee does not have formal objective criteria for determining the amount of diversity needed on the Board of Directors, it is one of the factors the committee considers in its evaluation. In nominating candidates to fill vacancies created by the expiration of the term of a member of the Board of Directors, the committee determines whether the incumbent director is willing to stand for re-election. If so, the committee evaluates his or her performance in office to determine suitability for continued service, taking into consideration the value of continuity and familiarity with our business.

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Director Resignation Policy

Our Bylaws require a candidate in an uncontested election for director to receive a majority of the votes cast in order to be elected as a director. Under this provision, each vote is specifically counted “for” or “against” the director’s election, unless a common stockholder abstains from voting with respect to the matter. Thus, a director nominee is required to receive more votes “for” than “against” to be elected. Pursuant to Maryland law, a director shall remain in office until his or her successor is duly elected and qualifies, even if the director has not received a vote sufficient for re-election. Thus, a company could have a “holdover” director. However, pursuant to our Board-approved director resignation policy, an incumbent director must tender his or her resignation to the Board of Directors if the director is nominated but not re-elected. The policy also requires the Compensation and Corporate Governance Committee to make a recommendation to the full Board of Directors on whether to accept or reject the resignation, and the full Board of Directors to make that determination. The Board of Directors will publicly disclose its decision within 90 days after receipt of the tendered resignation.

Any director who tenders his or her resignation pursuant to this policy may not participate in the Compensation and Corporate Governance Committee recommendation or Board of Directors action regarding whether to accept the resignation offer. If each member of the Compensation and Corporate Governance Committee does not receive a vote sufficient for re-election, then the disinterested directors who did not fail to receive a sufficient vote shall appoint a committee amongst themselves to consider the resignation offers and recommend to the Board of Directors whether to accept them. If the only directors who did not fail to receive a sufficient vote for re-election constitute three or fewer directors, all directors (other than the director who tendered the resignation under review) may participate in the action regarding whether to accept the resignation offers.

Executive Officers

The Board of Directors generally elects officers annually following our annual meeting of stockholders to serve until the meeting of the Board following the next annual meeting. Set forth below is certain information about each executive officer as of October 30, 2015. The business address for Messrs. Wilkus, Erickson and Flax is c/o American Capital Senior Floating, Ltd., 2 Bethesda Metro Center, 14^th Floor, Bethesda, MD 20814, and the address for Messrs. Pelletier, Cerullo and Dratch is c/o American Capital Senior Floating, Ltd., 505 Fifth Avenue, 26^th Floor, New York, NY 10017.

Name	Age	Position
Malon Wilkus	63	Chair and Chief Executive Officer
Mark Pelletier	50	President and Chief Investment Officer
John R. Erickson	55	Executive Vice President, Chief Financial Officer and Assistant Secretary
Samuel A. Flax	59	Executive Vice President, Chief Compliance Officer and Secretary
Michael Cerullo	49	Senior Vice President, Portfolio Manager and Head of Research
Dana Dratch	44	Senior Vice President, Portfolio Manager and Head of Trading

Malon Wilkus has served as our Chair and Chief Executive Officer since our incorporation in February 2013 and as Chief Executive Officer of our Manager since February 2013. Biographical information for Mr. Wilkus is set forth in the section entitled “Management—Board of Directors.”

Mark Pelletier has served as our President and Chief Investment Officer and President of our Manager since July 2013, and he previously served as a Senior Vice President of our Manager from February 2013 until July 2013. Mr. Pelletier has primary oversight for all of our investments and has over 25 years of investment experience. Mr. Pelletier is also the President of American Capital CLO Management, LLC, the external manager of each of ACAS CLO 2007-1, Ltd., ACAS CLO 2012-1, Ltd., ACAS CLO 2013-1, Ltd., ACAS CLO 2013-2, Ltd., ACAS CLO 2014-1, Ltd., ACAS CLO 2014-2, Ltd. and ACAS CLO 2015-1, Ltd., which also invest in Senior Secured Floating Rate Loans. In addition, Mr. Pelletier is President of ACSF Funding I, LLC, ACAS Funding I, LLC and ACAS Funding II, LLC, which invest in Senior Secured Floating Rate Loans. Mr. Pelletier served as a Senior Vice President and Managing Director of American Capital from 2005 through 2013. Prior to joining American Capital, Mr. Pelletier served as a senior portfolio manager and analyst for Flagship Capital Management, Inc. where he covered the commercial, industrial and technology sectors. Flagship Capital was part of the asset management arm of Bank of America, and focused on managing approximately $3 billion in Senior Secured Floating Rate Loans across seven CLO portfolios. Mr. Pelletier was a founding member of Flagship Capital, which commenced operations during 2000.

John R. Erickson has served as our Executive Vice President, Chief Financial Officer and Assistant Secretary and as Executive Vice President and Treasurer of our Manager since February 2013. Mr. Erickson is also the Executive Vice President and Treasurer of American Capital CLO Management, LLC, the external manager of each of ACAS CLO 2007-1, Ltd., ACAS

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CLO 2012-1, Ltd., ACAS CLO 2013-1, Ltd., ACAS CLO 2013-2, Ltd., ACAS CLO 2014-1, Ltd., ACAS CLO 2014-2, Ltd. and ACAS CLO 2015-1, Ltd., which also invest in Senior Secured Floating Rate Loans. In addition, Mr. Erickson is Executive Vice President and Treasurer of ACSF Funding I, LLC, ACAS Funding I, LLC and ACAS Funding II, LLC, which invest in Senior Secured Floating Rate Loans. Mr. Erickson is Executive Vice President and Treasurer of American Capital Asset Management, LLC, the asset fund management portfolio company of American Capital. Mr. Erickson has also served as President, Structured Finance of American Capital since 2008 and as its Chief Financial Officer since 1998. Mr. Erickson is also a member of the board of directors, Executive Vice President and Chief Financial Officer of each of American Capital Agency Corp. (NASDAQ: AGNC) and American Capital Mortgage Investment Corp. (NASDAQ: MTGE).

Samuel A. Flax has served as our Executive Vice President and Secretary since February 2013 and as our Chief Compliance Officer since July 2013. He has also served as Executive Vice President, Chief Compliance Officer and Secretary of our Manager since February 2013. Mr. Flax is the Executive Vice President, Chief Compliance Officer and Secretary of American Capital CLO Management, LLC, the external manager of each of ACAS CLO 2007-1, Ltd., ACAS CLO 2012-1, Ltd., ACAS CLO 2013-1, Ltd., ACAS CLO 2013-2, Ltd., ACAS CLO 2014-1, Ltd., ACAS CLO 2014-2, Ltd. and ACAS CLO 2015-1, Ltd., which also invest in Senior Secured Floating Rate Loans. In addition, Mr. Flax is Executive Vice President and Secretary of ACSF Funding I, LLC, ACAS Funding I, LLC and ACAS Funding II, LLC, which invest in Senior Secured Floating Rate Loans. Mr. Flax is Executive Vice President and Secretary of American Capital Asset Management, LLC, the asset fund management portfolio company of American Capital. Mr. Flax has also served as the Executive Vice President, General Counsel, Chief Compliance Officer and Secretary of American Capital since January 2005. Mr. Flax was a partner in the corporate and securities practice group of the Washington, D.C. law firm of Arnold & Porter LLP from 1990 to January 2005. At Arnold & Porter LLP, he represented American Capital in raising debt and equity capital, advised American Capital on corporate, securities and other legal matters and represented American Capital in many of its investment transactions. Mr. Flax is also a member of the board of directors, Executive Vice President and Secretary of each of American Capital Agency Corp. (NASDAQ: AGNC) and American Capital Mortgage Investment Corp. (NASDAQ: MTGE).

Michael Cerullo has served as our Senior Vice President, Portfolio Manager and Head of Research and Senior Vice President of our Manager since July 2013. Mr. Cerullo has over 25 years of investment experience. Mr. Cerullo is also a Senior Vice President of American Capital CLO Management, LLC, the external manager of each of ACAS CLO 2007-1, Ltd., ACAS CLO 2012-1, Ltd., ACAS CLO 2013-1, Ltd., ACAS CLO 2013-2, Ltd., ACAS CLO 2014-1, Ltd., ACAS CLO 2014-2, Ltd. and ACAS CLO 2015-1, Ltd., which also invest in Senior Secured Floating Rate Loans. In addition, Mr. Cerullo is Senior Vice President of ACSF Funding I, LLC, ACAS Funding I, LLC and ACAS Funding II, LLC, which invest in Senior Secured Floating Rate Loans. Mr. Cerullo joined American Capital in December 2005 as a Vice President in the Leveraged Finance Group, became Vice President and Principal in July 2007 and served as Senior Vice President and Managing Director during 2013. Prior to joining American Capital, he was Senior Vice President and Credit Products Officer in Bank of America’s Commercial Bank, serving midsized commercial and industrial companies based in New Jersey. His prior experience also includes over nine years lending to companies in the media and entertainment industries, three years lending to middle market companies located in the upstate New York market, and two years in commercial loan workouts, all with predecessor institutions of Bank of America.

Dana Dratch has served as our Senior Vice President, Portfolio Manager and Head of Trading since January 2014 and previously served as a Vice President from November 2013 until January 2014. Mr. Dratch has served as a Senior Vice President of our Manager since January 2014 and previously served as a Vice President of our Manager from July 2013 until January 2014. Mr. Dratch has 18 years of investment experience. Mr. Dratch is also a Senior Vice President of American Capital CLO Management, LLC, the external manager of each of ACAS CLO 2007-1, Ltd., ACAS CLO 2012-1, Ltd., ACAS CLO 2013-1, Ltd., ACAS CLO 2013-2, Ltd., ACAS CLO 2014-1, Ltd., ACAS CLO 2014-2, Ltd. and ACAS CLO 2015-1, Ltd., which also invest in Senior Secured Floating Rate Loans. In addition, Mr. Dratch is Senior Vice President of ACSF Funding I, LLC, ACAS Funding I, LLC and ACAS Funding II, LLC, which invest in Senior Secured Floating Rate Loans. Mr. Dratch joined American Capital in November 2005 as a Vice President in the Leveraged Finance Group and served as Vice President and Principal during 2013. Prior to joining American Capital, Mr. Dratch was employed at Merrill Lynch Capital (which was subsequently acquired by General Electric) underwriting leveraged transactions that were primarily sourced through the firm’s brokerage force. Prior to joining Merrill Lynch, he was employed at RBC Capital Markets’ Corporate Credit group covering a portfolio of large-cap borrowers. Prior to joining RBC, Mr. Dratch underwrote and monitored leveraged transactions in the Media and Healthcare divisions of FleetBoston Financial (which was subsequently acquired by Bank of America).

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PORTFOLIO MANAGEMENT

The management of our investment portfolio is the responsibility of our Manager, American Capital ACSF Management, LLC, and its Investment Committee and senior investment team.

Investment Committee

Our Manager has established an Investment Committee, consisting of Messrs. Wilkus, Erickson, Flax, Pelletier and McHale, each of whom is an officer of our Manager. For biographies of the members of our Manager’s Investment Committee, see “Management—Board of Directors,” “Management—Executive Officers” and “Our Manager, American Capital and the Management Agreement—Our Manager—Officers of Our Manager.” The role of the Investment Committee is to monitor the performance of our Manager with respect to our investment strategy, to monitor our investment portfolio and to monitor our compliance requirements related to our intention to qualify as a BDC and RIC. The Investment Committee meetS on a regular basis as frequently as it believes is required to maintain prudent oversight of our investment activities. The Investment Committee expects to set and monitor operating policies and guidelines and to receive notification in the event that we may operate outside of such policies or guidelines. The Investment Committee and/or our Board of Directors may change these policies or guidelines at any time without approval from our stockholders.

Senior Investment Team

Our Manager’s senior investment team currently consists of Mark Pelletier, Michael Cerullo, Dana Dratch, Juan Miguel Estela, Christian Toro and William Weiss. Members of our Manager’s senior investment team must approve each new investment that we make. We consider our senior investment team, led by Mark Pelletier, to be our portfolio managers. For biographies of the members of our Manager’s senior investment team, see “Our Manager, American Capital and the Management Agreement—Our Manager—Officers of Our Manager.”

As of June 30, 2015, our portfolio managers also managed investments on behalf of the following entities (amounts in thousands):

Name	Type	Primary Investment Focus	Face Value of Loans / Notional Value (1)
ACAS CLO 2007-1, Ltd.	CLO	Senior Secured Floating Rate Loans	$	232,000
ACAS CLO 2012-1, Ltd.	CLO	Senior Secured Floating Rate Loans	$	352,000
ACAS CLO 2013-1, Ltd.	CLO	Senior Secured Floating Rate Loans	$	405,000
ACAS CLO 2013-2, Ltd.	CLO	Senior Secured Floating Rate Loans	$	407,000
ACAS CLO 2014-1, Ltd.	CLO	Senior Secured Floating Rate Loans	$	601,000
ACAS CLO 2014-2, Ltd.	CLO	Senior Secured Floating Rate Loans	$	403,000
ACAS CLO 2015-1, Ltd.	CLO	Senior Secured Floating Rate Loans	$	555,000
American Capital, Ltd. (2)	Separately Managed Account	Senior Secured Floating Rate Loans	$	2,304,000
American Capital, Ltd. (3)	Separately Managed Account	CLO Equity	$	911,000

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(1)Face value of loans / notional value for the CLO equity investments were calculated using the latest trustee report prior to June 30, 2015 and rounded to the nearest million. Balances exclude cash available for reinvestment.

(2)Loan investments managed for American Capital, Ltd. are held at the following wholly-owned financing subsidiaries: ACAS Funding I, LLC and ACAS Funding II, LLC.

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(3)CLO equity investments managed for American Capital, Ltd. are held at the following entities: American Capital, Ltd. and AC Corporate Holdings, Inc.

Compensation and Security Ownership

None of our Manager’s investment professionals receives any direct compensation from us in connection with the management of our portfolio.

The SAI provides additional information about our equity securities owned by our Manager’s senior investment team.

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OUR MANAGER, AMERICAN CAPITAL AND THE MANAGEMENT AGREEMENT

Our Manager

We are externally managed by American Capital ACSF Management, LLC pursuant to the terms of a management agreement. Our Manager is responsible for administering our business activities and day-to-day operations, subject to the supervision and oversight of our Board of Directors. Our Manager is an indirect subsidiary of a wholly-owned portfolio company of American Capital. All of our officers and the members of our Manager’s senior investment team and other support personnel are employees of American Capital or the parent company of our Manager. Because neither we nor our Manager have any employees, our Manager has entered into an administrative services agreement with American Capital and the parent company of our Manager, pursuant to which our Manager will have access to their employees, including senior management and operations, finance, compliance, legal, capital markets, accounting, treasury, investor relations and information technologies staffs, and their infrastructure, operations, business relationships and management expertise, to enable our Manager to fulfill all of its responsibilities under the management agreement. We do not pay any of these individuals any cash or equity-based compensation. Rather, we pay our Manager a management fee pursuant to the management agreement.

Officers of Our Manager

Set forth below are the names and ages of certain officers of our Manager and their respective positions as of October 30, 2015. The address for Messrs. Wilkus, Erickson, Flax and Toro is c/o American Capital ACSF Management, LLC, 2 Bethesda Metro Center, 14th Floor, Bethesda, MD 20814, and the address for Messrs. Pelletier, Cerullo, Dratch, Estela and Weiss is c/o American Capital ACSF Management, LLC, 505 Fifth Avenue, 26th Floor, New York, NY 10017.

Name	Age	Position Held with Our Manager
Malon Wilkus	63	Chief Executive Officer
Mark Pelletier	50	President
John R. Erickson	55	Executive Vice President and Treasurer
Samuel A. Flax	59	Executive Vice President, Chief Compliance Officer and Secretary
Michael Cerullo	49	Senior Vice President
Dana Dratch	44	Senior Vice President
Richard Britt	48	Senior Vice President
Juan Miguel Estela	40	Vice President
Christian Toro	42	Vice President
William Weiss	44	Vice President
Thomas A. McHale	43	Vice President and Assistant Secretary

Biographical information for Mr. Wilkus is set forth in the section entitled “Management—Board of Directors” and biographical information for each of Messrs. Pelletier, Erickson, Flax, Cerullo and Dratch is set forth in the section entitled “Management—Executive Officers.” Biographical information for Messrs. Britt, Estela, Toro, Weiss and McHale is set forth below.

Richard Britt is a Senior Vice President of our Manager, with 25 years of operational and credit control experience.  Mr. Britt joined the parent company of our Manager in June 2014 as a Managing Director and Senior Vice President, where he is focused on operational matters, including portfolio tracking, monitoring, internal reporting, trade settlement and processing and information systems management. From 2006 to 2014, Mr. Britt was employed at Deutsche Investment Management Americas Inc., where he led the High Yield Strategies Group’s Transaction Management team and had the overall responsibility for operational matters related to the firm’s global loan platform, including portfolio tracking, information management, systems, trustee interface, and investor contact on operational and administrative matters. Prior to joining Deutsche Investment Management Americas Inc., Mr. Britt was employed at Flagship Capital Management, Inc. as the Head of Decision Support & Investor Relations. Previously, he was a Credit Officer for FleetBoston Financial covering specialty finance companies and commercial and industrial companies based in New York City, a Manager in Fleet Bank’s Loan Operations function and an Audit Supervisor at NatWest Bank.

Juan Miguel Estela is a Vice President of our Manager, with 14 years of financial services industry experience. Mr. Estela joined American Capital in May 2004 as a Senior Treasury Analyst, where he focused on the structuring and administration of structured debt. Mr. Estela became an Associate in the Leveraged Finance Group in January 2006, where he was focused on investing in third-party managed CLOs as well as covering companies operating in the Paper and Packaging, Aerospace and Defense, Real Estate and Transportation sectors, and became a Vice President in January 2007. Prior to joining American Capital,

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Mr. Estela was a Credit Analyst for Citibank Colombia where his responsibilities included underwriting and monitoring corporate credits across the Food, Beverage and Retail industries. More recently he was part of the Organization of American States, where he evaluated and made recommendations on the budget assignments of the Inter-American Agency for Cooperation & Development.

Christian Toro is a Vice President of our Manager, with 16 years of financial services industry experience. Mr. Toro joined American Capital in March 2003 as a Treasury Manager where he focused on the execution, administration and monitoring of secured and unsecured corporate debt. In August 2006 Mr. Toro joined the Leveraged Finance Group where he is focused on evaluating and executing principal CLO investments for the firm as well as covering companies operating in the Retail and Diversified manufacturing sector, and became a Vice President in January 2007. Prior to joining American Capital, Mr. Toro was with Deloitte & Touche LLP, most recently as a member of the Global Capital Markets Group where he was focused on the implementation of GAAP for asset-backed and mortgage-backed securities transactions. Previously, he was a senior consultant in the Asset Securitization Group of PricewaterhouseCoopers LLP where he focused on reviewing transactions for the Securitization Accounting and Modeling Solutions practice – a specialized securitization accounting, cash-flow modeling and valuation group.

William Weiss is a Vice President of our Manager, with 20 years of investment experience. Mr. Weiss joined American Capital in January 2007 as a Vice President in the Leveraged Finance Group. Prior to joining American Capital, Mr. Weiss was employed with Deutsche Asset Management as a research analyst covering large and middle market companies operating in diversified industries including media, cable, telecommunications, business services and food products. Prior to joining Deutsche Asset Management, he was employed with Bank of America’s CLO group as a portfolio analyst covering diversified industries. Prior to joining Bank of America, Mr. Weiss underwrote and monitored leveraged transactions in the Media and Communications division of FleetBoston Financial (which was subsequently acquired by Bank of America).

Thomas A. McHale is Vice President and Assistant Secretary of our Manager. Mr. McHale is also a Vice President of American Capital Asset Management, LLC, which is the asset fund management portfolio company of American Capital and also the sole member of the parent company of our Manager. In addition, Mr. McHale has served as the Senior Vice President, Finance of American Capital since May 2006. He served as Vice President, Finance and Investor Relations and Assistant Secretary of American Capital from 2002 to May 2006. Mr. McHale joined American Capital in December 1998.

American Capital, Ltd.

Founded in 1986, American Capital is a publicly-traded private equity firm and global asset manager which directly and through its asset management business, originates, underwrites and manages investments in private equity, sponsored finance, real estate, energy and infrastructure, leveraged loans and CLOs. As of June 30, 2015, American Capital had eight offices in the United States, Europe and Asia and $81 billion in assets under management (included levered assets) across its target asset classes.

Management Agreement

Management Services

Our management agreement with our Manager has a current renewal term expiring January 15, 2017. Unless terminated earlier, the management agreement will automatically renew following the expiration of its then current term for a one year period if approved annually by the Board of Directors or by the affirmative vote of the holders of a majority of our outstanding voting securities, and, in either case, if also approved by the majority of our directors who are not "Interested Persons" as defined under the 1940 Act. The management agreement automatically terminates in the event of its assignment, as defined in the 1940 Act, by our Manager. The management agreement may also be terminated at any time, without the payment of any penalty, upon 60 days’ written notice, by (i) holders of a majority of our outstanding voting securities, (ii) our Board of Directors or (iii) our Manager. See “Risk Factors—Risks Related to Our Relationship with Our Manager and American Capital.” A discussion regarding the basis for our Board of Directors’ approval of the management agreement for its current term will be included in our Annual Report on Form 10-K for the year ended December 31, 2015.

The management agreement requires our Manager to oversee our business affairs in conformity with the Investment Committee’s operating policies and guidelines. Our Manager at all times is subject to the supervision and direction of our Board of Directors, the terms and conditions of the management agreement and such further limitations or parameters as may be imposed from time to time by our Board of Directors. Our Manager is generally responsible for (i) the selection, purchase, sale and monitoring of our investment portfolio, (ii) our financing and hedging activities and (iii) providing us with investment advisory services. Our Manager is responsible for our day-to-day operations and performs such services and activities relating to our assets and operations, as appropriate.

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Our Manager receives a management fee from us that is payable quarterly in arrears. The management fee is calculated at an annual rate of 0.80% of our total consolidated assets, excluding cash and cash equivalents and net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. There is no incentive compensation paid to our Manager under the management agreement. The management fee is prorated for any partial period and totaled $2,186,000 and $0 for the year ended December 31, 2014 and the period from October 15, 2013 (commencement of operations) to December 31, 2013, respectively. The management fee totaled $1,141,000 for the six months ended June 30, 2015.

ACSF Funding has entered into an investment advisory agreement with our Manager to manage its assets. No additional compensation is payable to our Manager under such agreement.

Payment of Our Expenses

We do not have any employees and do not pay our officers any cash or non-cash equity compensation. We currently pay, or reimburse our Manager and its affiliates, for expenses related to our operations incurred on our behalf, but excluding employment-related expenses of our and our Manager’s officers and any employees of American Capital or the parent company of our Manager who provide services to us pursuant to the management agreement or to our Manager pursuant to the administrative services agreement. For the year and period ended December 31, 2014 and 2013, we recognized $970,000 and $48,000, respectively, of expenses that are reimbursable to our Manager and its affiliates. For the six months ended June 30, 2015 we recognized $484,000 of expenses that are reimbursable to our Manager and its affiliates. However, for 24 months following the IPO, our other operating expenses will be limited to an annual rate of 0.75% of our consolidated net assets, less net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. For the purposes of the preceding operating expense limit, other operating expenses include both (i) our operating expenses reimbursed to our Manager and its affiliates for expenses related to our operations incurred on our behalf and (ii) our operating expenses directly incurred by us excluding the management fee, interest costs, taxes and accrued costs and fees related to actual, pending or threatened litigation, each as determined under GAAP for the most recently completed fiscal quarter. As a result of this operating expense limit during the above period, any reimbursements to our Manager and its affiliates could be reduced or eliminated and, in certain instances, our Manager could be required to reimburse us so that our other operating expenses do not exceed the limits described above. In October 2015, our Manager agreed to extend the 0.75% cap on other operating expenses until the date of our 2016 Annual Meeting of Stockholders, at which time we expect to submit to a vote of stockholders an amendment and restatement of the management agreement which would (i) extend the expense cap through December 31, 2020, (ii) subject to the expense cap, provide for reimbursement by us to our Manager for certain compensation expenses related to legal, compliance and internal audit personnel of our Manager and its affiliates who provide services to us and (iii) make certain other immaterial changes.  Following the expiration of the expense cap, there are no limits on the reimbursement to our Manager or its affiliates of such expenses related to our operations. For the year and period ended December 31, 2014 and 2013, our Manager was responsible for $1,001,000 and $0, respectively, of operating expenses as a result of the expense cap. For the six months ended June 30, 2015, our Manager was responsible for $554,000 of operating expenses as a result of the expense cap.

The costs and expenses required to be paid by us include, but are not limited to:

• certain costs incurred in connection with capital raising activities;

• transaction costs incident to the acquisition, disposition, financing, hedging and ownership of our investments;

• diligence costs incurred for prospective investments;

• expenses incurred in contracting with third parties;

• external legal, auditing, accounting, consulting, investor relations, portfolio valuation, brokerage and administrative fees and expenses;

• the compensation and expenses of our independent directors and the cost of liability insurance to indemnify our directors and officers and the officers and employees of our Manager and its affiliates who provide services to us;

• the costs associated with our establishment and maintenance of any indebtedness (including interest expense, commitment fees, accounting fees, legal fees, closing costs, rating agency fees and similar expenses);

• expenses relating to the payment of dividends;

• costs incurred by our Board of Directors and personnel of our Manager or its affiliates for travel on our behalf;

• expenses relating to communications to holders of our securities and in complying with the continuous reporting and other requirements of the SEC and other governmental bodies;

• tax and license fees applicable to us and our subsidiaries, including external fees for tax and regulatory compliance;

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• insurance costs incurred by us and our subsidiaries;

• transfer agent, custodial, trustee, third-party loan administration and exchange listing fees;

• the costs of printing and mailing proxies and reports to our stockholders;

• the costs of establishing and maintaining our website;

• all costs of organizing, modifying or dissolving our company or any subsidiary and costs in preparation of entering into or exiting any business activity;

• our pro rata portion of costs associated with any computer software, hardware or information technology services that are used by us or our Manager on our behalf;

• our pro rata portion of the costs and expenses incurred with respect to market information systems and publications, research publications and materials used by us or our Manager on our behalf;

• settlement, clearing, trustee, prime brokerage and custodial fees and expenses relating to us;

• the costs of maintaining compliance with all federal, state and local rules and regulations or any other regulatory agency (as such costs relate to us), all taxes and license fees and all insurance costs incurred on behalf of us;

• the costs of administering our equity incentive plans, if any; and

• our pro rata portion of rent (including disaster recovery facility costs and expenses), telephone, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses of our Manager and its affiliates required for our operations.

Indemnification

The management agreement provides that our Manager and its affiliates and their respective directors, officers, employees, members, managers, partners and stockholders are entitled to broad indemnification from us from and against any claims or liabilities (including reasonable legal fees and other expenses reasonably incurred, arising out of or in connection with our business and operations or any action taken or omitted on our behalf pursuant to authority granted by the management agreement) to the fullest extent such indemnification is then permitted under our charter and bylaws, the 1940 Act, the Advisers Act, the laws of the State of Maryland and any other applicable law.

Administrative Services Agreement

Because neither we nor our Manager have any employees, our Manager provides services to us through certain employees of American Capital or the parent company of our Manager pursuant to an administrative services agreement. Under such agreement, our Manager is provided with the services and other resources necessary to perform its obligations and responsibilities under the management agreement. In addition, certain members of American Capital’s senior management team serve as officers of our Manager and us. Further, under the administrative services agreement, American Capital and the parent company of our Manager are required to provide our Manager with the services of their employees such that our Manager may provide us with a chief executive officer, chief financial officer and chief investment officer pursuant to the terms of the management agreement.

If either we or our Manager elect to terminate the management agreement pursuant to its terms (as described above), the administrative services agreement would likewise be terminated. The administrative services agreement will only be able to be terminated upon the expiration or termination of the management agreement. Pursuant to the administrative services agreement, American Capital and the parent company of our Manager are able to assign their rights and obligations thereunder to any of their affiliates, including ACAM, the sole member of the parent company of our Manager.

We are not a party to the administrative services agreement. Therefore, we do not have any recourse against American Capital or the parent company of our Manager if they do not fulfill their obligations under the administrative services agreement or if they elect to assign the agreement to one of their affiliates.

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Conflicts of Interest in Our Relationship with Our Manager, Our Management Team and American Capital

Management Agreement. We were incorporated by American Capital, the indirect owner of our Manager. As a consequence, the terms of our management agreement, including fees payable, were not negotiated on an arm’s-length basis, and its terms may not be as favorable to us as if they were negotiated with an unaffiliated party. The compensation we pay to our Manager consists of a management fee, which is not tied to our performance. The management fee is paid regardless of our performance and it may not provide sufficient incentive to our Manager to seek to achieve attractive risk-adjusted returns for our investment portfolio. This could result in reduced returns to our investors.

Time Commitments of Our Management Team. Our Manager is responsible for making all of our investment decisions. All of our and our Manager’s officers are employees of American Capital or the parent company of our Manager, and none of them devotes his or her time to us exclusively. We expect our officers and other appropriate personnel of American Capital and the parent company of our Manager to devote such portion of their time as is necessary to enable us to effectively operate our business.

Restrictions on Investments and Allocation of Investment Opportunities. American Capital and its affiliates have historically sponsored or managed, and currently sponsor or manage, investment vehicles with similar or overlapping investment strategies and have put in place a conflict resolution policy that addresses the co-investment restrictions set forth under the 1940 Act. We may co-invest on a concurrent basis with other affiliates of American Capital, unless doing so is impermissible with existing regulatory guidance, applicable regulations, the terms of any exemptive relief granted to us and our allocation procedures.

Our Manager and its affiliates have both subjective and objective policies and procedures in place that are intended to manage potential conflicts of interest between our Manager’s fiduciary obligations to us and similar fiduciary obligations of our Manager and its affiliates to their respective other clients. To the extent that we compete with entities sponsored or managed by American Capital or its affiliates for a particular investment opportunity, our Manager and its affiliates will allocate investment opportunities across the entities for which such opportunities are appropriate, consistent with (1) each entity’s investment objective, investment policies, investment position and available capital, (2) our Manager’s and its affiliates’ internal conflict of interest and allocation policies, (3) the requirements of the Advisers Act, and (4) certain restrictions under the 1940 Act regarding a BDC’s co-investments with affiliates.

Our Manager seeks to ensure the equitable allocation of investment opportunities when we are able to invest alongside other investment vehicles sponsored or managed by American Capital and its affiliates. When we invest alongside such other vehicles, such investments are made consistent with the allocation policy of the parent company of our Manager. Under this allocation policy, our Manager will make an investment decision on our behalf with respect to the amount of any proposed investment to be made by us and each other eligible investment vehicle’s manager will make a separate investment decision on behalf of it. If sufficient securities or loan amounts are available to satisfy our and each such vehicle’s proposed investment, the opportunity will be allocated in accordance with our Manager’s pre-transaction determination. Where there is an insufficient amount of an investment opportunity to fully satisfy us and other vehicles sponsored or managed by American Capital or its affiliates, the allocation policy further provides that allocations among us and other vehicles will generally be made pro rata based on the amount that each such party would have invested if sufficient securities or loan amounts were available. In situations in which co-investment with other entities sponsored or managed by American Capital or its affiliates is not permitted or appropriate, our Manager will need to decide whether we or such other entity or entities will proceed with the investment. Our Manager will make these determinations based on its policies and procedures, which generally require that such opportunities be offered to eligible investment vehicles on a basis that will be fair and equitable over time, including, for example, through random or rotational methods.

The allocation policy of the parent company of our Manager is intended to ensure that, over time, we may generally share equitably in investment opportunities with other investment vehicles sponsored or managed by American Capital or its affiliates, particularly those involving a security with limited supply or involving differing classes of securities of the same issuer which may be suitable for us and such other vehicles. There can be no assurance that our Manager’s or its affiliates’ efforts to allocate any particular investment opportunity fairly among all clients for whom such opportunity is appropriate will result in an allocation of all or part of such opportunity to us. Not all conflicts of interest can be expected to be resolved in our favor.

Our Management Team. Each of our and our Manager’s officers is an employee of American Capital or the parent company of our Manager and none of them is required to devote his or her time to us exclusively. Each of our and our Manager’s officers has significant responsibilities to American Capital and certain of its various portfolio companies, affiliated entities or managed funds. Mr. Pelletier and the other members of our Manager’s senior investment team provide services to us and may provide services to American Capital or other investment vehicles that have been or may be sponsored by American Capital in the future and may have similar investment strategies. As such, conflicts may arise as employees of American Capital and certain

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of its affiliates may have conflicts between their duties to us and their duties to, and interest in, other funds or entities to which they provide services.

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DETERMINATION OF NET ASSET VALUE

The NAV per share of our outstanding common stock is determined quarterly, as soon as practicable after and as of the end of each calendar quarter, by dividing the value of total assets minus liabilities by the total number of shares of common stock outstanding at the date as of which the determination is made.

When available, our investments are valued using unadjusted quoted prices in active markets such as an over-the-counter market as of the valuation date. We may also value our investments based on evaluated prices received from nationally recognized independent pricing services or from third-party brokers who make markets in such debt investments. There is not a readily available market value within a recent date for many of our investments; those investments that are not publicly traded or whose market prices are not readily available are valued at fair value as determined in good faith by our Board of Directors. We value such investments at fair value as determined in good faith by our Board of Directors using a documented valuation policy and a consistently applied valuation process.

Due to the uncertainty inherent in the valuation process, estimates of fair value may differ significantly from the values that would have been used had a ready market for our investments existed, and the differences could be material. Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the valuations currently assigned.

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DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN

Our Board of Directors has adopted a dividend reinvestment and stock purchase plan that provides for reinvestment of our cash dividends and distributions on behalf of our registered stockholders and any brokers, banks or other nominees (collectively, a “Nominee”) of a beneficial owner of shares of our common stock that are registered in such Nominee’s name (collectively, “participants”), unless a stockholder elects to opt-out of the plan. As a result, if our Board of Directors authorizes, and we declare, a cash distribution, then our registered stockholders and Nominees who have not opted out of our dividend reinvestment and stock purchase plan will have their cash distributions automatically reinvested in additional shares of our common stock, rather than receiving the cash distributions. The plan also provides a method for participants to make optional cash purchases of shares of our common stock.

No action will be required on the part of a registered stockholder to participate in the plan and have his, her or its cash dividends and distributions reinvested in shares of our common stock. Cash dividends and distributions to beneficial owners of our common stock will be automatically reinvested in additional shares of our common stock under the plan only if such owner’s Nominee provides this service to them and the Nominee has not elected, on their behalf, to opt-out of the plan and receive cash dividends and distributions. A registered stockholder may elect to receive an entire distribution in cash by notifying Computershare Trust Company, N.A., the plan administrator and our transfer agent and registrar, by telephone, internet or in writing that he, she or it wishes to terminate participation in the plan. Beneficial owners may receive distributions in cash by contacting their Nominee to terminate his, her or its participation in the plan.

The optional cash purchase component of the plan permits plan participants to purchase shares of our common stock on a monthly basis in amounts, subject to certain exceptions, ranging from $50 to $10,000 or, with our prior approval, in excess of $10,000.

The plan administrator will set up an account for each participant for shares acquired through the plan. Certificates for shares issued under the plan generally will not be furnished; rather, shares will be held in book entry form in the participant’s plan account. Registered holders may request certificates through the internet, by telephone or in writing for a specified number of shares credited to their plan account. Beneficial owners can receive certificates for shares issued under the plan by contacting their Nominee to become a registered holder.

Generally, we intend to issue shares of common stock to implement the plan, subject to the provisions of the 1940 Act. At our discretion, shares sold to the plan administrator may be either newly issued or treasury shares. However, for dividend reinvestments and optional cash purchases of less than $10,000, we may instruct the plan administrator to buy shares in the market under certain circumstances. In connection with dividend reinvestments and optional cash purchases below $10,000 under the plan, the price of shares issued by, or purchased directly from, us will be the consolidated volume weighted average price, rounded to four decimal places, of our common stock as quoted on The NASDAQ Global Market, obtained from Bloomberg, LP for the trading hours from 9:30 a.m. to 4:00 p.m. (up to and including the closing print), Eastern time, for that purchase date, less at times a 1% discount (in our sole discretion) for shares issued by us for dividend reinvestments. The purchase price of shares purchased in the open market will be the weighted average price per share of the shares of common stock purchased. 

We will pay all administrative costs associated with the reinvestment of dividends under the plan. There are no transaction or processing fees, expenses or service charges under the plan in connection with such purchases. If the plan purchases shares with reinvested dividends in market transactions instead of directly from us, we will pay any such fees on such purchases. For the optional cash purchase part of the plan, the plan administrator will charge participants a processing fee of $0.03 per share in connection with any optional cash payments made in the open market under the plan. The processing fee includes any brokerage commissions that the plan administrator is required to pay. In addition, the plan administrator will charge participants a $5.00 transaction fee for optional cash payments made by check or one-time online ACH, and a $2.50 transaction fee for each optional cash payment made by recurring debit from a U.S. bank account.

Stockholders who receive distributions in the form of stock are subject to the same federal, state and local tax consequences as are stockholders who elect to receive their distributions in cash. A stockholder’s basis for determining gain or loss upon the sale of stock received in a distribution from us will be equal to the amount of cash they would have received if they had elected to receive the distribution in cash, or the fair market value of the distributed shares if such shares have a fair market value equal to or greater than NAV. Any stock received in a distribution will have a new holding period for tax purposes commencing on the day following the day on which the shares are credited to the U.S. stockholder’s account.

A complete copy of our dividend reinvestment and stock purchase plan is filed as an exhibit to the registration statement of which this prospectus forms a part. You may obtain additional information about our dividend reinvestment and stock purchase plan, including a copy of the plan, by writing us at our principal office, which is located at 2 Bethesda Metro Center, 14th Floor,

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Bethesda, MD 20814, Attention: Investor Relations or by contacting the plan administrator at the following address: Computershare Trust Company, N.A., P.O. Box 30170, College Station, TX 77842-3170, or calling (800) 733-5001 (U.S. and Canada) (781) 575-3400 (outside U.S. and Canada) or through the Internet, at www.computershare.com/investor.

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DESCRIPTION OF CAPITAL STOCK

The following is a summary of the rights and preferences of our capital stock and related provisions of our charter and bylaws. The following summary description of our stock does not purport to be complete and is qualified in its entirety by reference to the MGCL and our charter and bylaws. We encourage you to read carefully this entire prospectus, our charter and bylaws and the other documents we refer to for a more complete understanding of our capital stock. The forms of our charter and bylaws are filed as exhibits to the registration statement of which this prospectus is a part. See “Additional Information.”

General

Our charter provides that we may issue up to 300,000,000 shares of common stock and 50,000,000 shares of preferred stock, both having par value $0.01 per share. Our charter authorizes our Board of Directors to amend our charter, with the approval of a majority of the entire Board of Directors and without stockholder approval, to increase or decrease the aggregate number of shares of stock that we are authorized to issue or the number of authorized shares of stock of any class or series. As of October 30, 2015, 10,000,100 shares of our common stock were issued and outstanding. Set forth below is a chart describing the classes of our authorized securities under our charter:

Title of Class	Amount Authorized	Amount Outstanding as of October 30, 2015
Common Stock, par value $0.01 per share	300,000,000	10,000,100
Preferred Stock, par value $0.01 per share	50,000,000	—

Under Maryland law, our stockholders are not generally liable for our debts or obligations.

Common Stock

All of the shares of common stock offered by this prospectus will be duly authorized, fully paid and nonassessable. Subject to the preferential rights, if any, of holders of any other class or series of our stock, holders of outstanding shares of our common stock are entitled to receive dividends on such shares of common stock out of assets legally available therefor if, as and when authorized by our Board of Directors and declared by us, and the holders of outstanding shares of our common stock will be entitled to share ratably in our assets legally available for distribution to our stockholders in the event of our liquidation, dissolution or winding up, after payment of or adequate provision for all of our known debts and liabilities.

Except as may otherwise be specified in the terms of any class or series of common stock, each outstanding share of common stock entitles the holder to one vote on all matters submitted to a vote of stockholders, including the election of directors, and, except as may be provided with respect to any other class or series of our stock, the holders of shares of our common stock will possess the exclusive voting power. There is no cumulative voting in the election of directors, which means that the holders of a majority of the outstanding shares of our common stock can elect all of the directors then standing for election, and the holders of the remaining shares will not be able to elect any directors.

Holders of shares of our common stock have no preference, conversion, exchange, sinking fund, redemption or appraisal rights and have no preemptive rights to subscribe for any securities of our company. Shares of our common stock will have equal dividend, liquidation and other rights.

Preferred Stock 

In addition to shares of our common stock, our charter authorizes the issuance of shares of our preferred stock. Our Board of Directors is authorized to provide for the issuance of our preferred stock with such preferences, powers, rights and privileges as our Board of Directors deems appropriate; except that, such an issuance must adhere to the requirements of the 1940 Act. The 1940 Act requires, among other things, that (i) immediately after issuance and before any distribution is made with respect to our common stock, preferred stock, together with all other senior securities, must not exceed an amount equal to 50% of our total assets and (ii) the holders of shares of our preferred stock, if any are issued, must be entitled as a class to elect two directors at all times and to elect a majority of the directors if dividends on our preferred stock are in arrears by two years or more. Furthermore, the 1940 Act restricts the ability of a BDC to issue warrants, options or rights to subscribe or convert to voting securities of the company. If we were to issue preferred stock convertible into shares of our common stock, such proposal must first be approved by our stockholders. 

We have no present plans to issue any shares of our preferred stock, but believe the availability of such stock will provide us with increased flexibility in raising capital. If we offer preferred stock under this prospectus, we will issue an appropriate prospectus supplement. You should read that prospectus supplement for a description of our preferred stock, including, but not

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limited to, whether there will be an arrearage in the payment of dividends or sinking fund installments, if any, restrictions with respect to the declaration of dividends, requirements in connection with the maintenance of any ratio or assets, or creation or maintenance of reserves, or provisions for permitting or restricting the issuance of additional securities.

Approval of Extraordinary Corporate Action; Amendment of Charter and Bylaws

Under the MGCL, a Maryland corporation generally cannot dissolve, amend its charter, merge or consolidate with another entity, sell all or substantially all of its assets or engage in a statutory share exchange unless the action is advised by the board of directors and approved by the affirmative vote of stockholders entitled to cast at least two-thirds of the votes entitled to be cast on the matter, unless a lesser percentage (but not less than a majority of all of the votes entitled to be cast on the matter) is specified in the corporation’s charter. Our charter generally provides that these actions must be approved by a majority of all of the votes entitled to be cast on the matter. Our charter also provides that certain charter amendments require the approval of the stockholders entitled to cast at least 75 percent of the votes entitled to be cast on such matter. Our Board of Directors has the exclusive power to adopt, alter or repeal any provision of our bylaws and to make new bylaws.

Maryland law also permits a corporation to transfer all or substantially all of its assets without the approval of its stockholders to an entity owned, directly or indirectly, by the corporation. Because our operating assets may be held by our wholly owned subsidiaries, these subsidiaries may be able to merge or transfer all or substantially all of their assets without the approval of our stockholders.

Power to Reclassify Unissued Shares of Our Stock

Our charter authorizes our Board of Directors to classify and reclassify any unissued shares of our common or preferred stock into other classes or series of stock, including one or more classes or series of stock that have priority over our common stock with respect to voting rights, dividends or upon liquidation, and authorize us to issue the newly classified shares. Prior to the issuance of shares of each new class or series, our Board of Directors is required by Maryland law and by our charter to set the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption for each class or series. Our Board of Directors may take these actions without stockholder approval unless stockholder approval is required by the rules of any stock exchange or automated quotation system on which our securities may be listed or traded. Therefore, our Board of Directors could authorize the issuance of shares of common or preferred stock with terms and conditions that could have the effect of delaying, deferring or preventing a change in control or other transaction that might involve a premium price for shares of our common stock or otherwise be in the best interest of our stockholders. No shares of preferred stock are presently outstanding, and we have no present plans to issue any shares of preferred stock.

Power to Increase or Decrease Authorized Shares of Stock and Issue Additional Shares of Common and Preferred Stock

Our charter authorizes our Board of Directors, with the approval of a majority of the entire Board of Directors and without stockholder approval, to amend our charter to increase or decrease the aggregate number of shares of stock, or the number of shares of any class or series of stock, that we are authorized to issue.

We believe that the power of our Board of Directors to approve amendments to our charter to increase or decrease the number of authorized shares of stock, to authorize us to issue additional authorized but unissued shares of common or preferred stock and to classify or reclassify unissued shares of common or preferred stock and thereafter to authorize us to issue such classified or reclassified shares of stock will provide us with increased flexibility in structuring possible future financings and acquisitions and in meeting other needs that might arise. Although our Board of Directors does not intend to do so, it could authorize us to issue a class or series of stock that could, depending upon the terms of the particular class or series, delay, defer or prevent a change in control or other transaction that might involve a premium price for shares of our common stock or otherwise be in the best interest of our stockholders.

Transfer Agent and Registrar

The transfer agent and registrar for our shares of common stock is Computershare Trust Company, N.A. The principal business address of Computershare Trust Company, N.A. is P.O. Box 43010, Providence, Rhode Island 02940-3010.

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DESCRIPTION OF SUBSCRIPTION RIGHTS

General

We may issue subscription rights to our stockholders to purchase common stock. Subscription rights may be issued independently or together with any other offered security and may or may not be transferable by the person purchasing or receiving the subscription rights. In connection with a subscription rights offering to our stockholders, we would distribute certificates evidencing the subscription rights and a prospectus supplement to our stockholders on the record date that we set for receiving subscription rights in such subscription rights offering.

The applicable prospectus supplement would describe the following terms of subscription rights in respect of which this prospectus is being delivered:

• the title of such subscription rights;

• the exercise price for such subscription rights (or method of calculation thereof);

• the number or a formula for the determination of the number of such subscription rights issued to each stockholder;

• the extent to which such subscription rights are transferable;

• if applicable, a discussion of certain U.S. federal income tax considerations applicable to the issuance or exercise of such subscription rights;

• the date on which the right to exercise such subscription rights shall commence, and the date on which such right shall expire (subject to any extension);

• the extent to which such subscription rights include an over-subscription privilege with respect to unsubscribed securities and the terms of such over-subscription privilege;

• any termination right we may have in connection with such subscription rights offering; and

• any other terms of such subscription rights, including exercise, settlement and other procedures and limitations relating to the transfer and exercise of such subscription rights.

We will not offer any transferable subscription rights to purchase shares of our common stock under this prospectus or an accompanying prospectus supplement at a price below our NAV per share, exclusive of any any underwriting commissions or discounts, without first filing a new post-effective amendment to the registration statement.

Exercise of Subscription Rights

Each subscription right would entitle the holder of the subscription right to purchase for cash such amount of shares of common stock at such exercise price as shall in each case be set forth in, or be determinable as set forth in, the prospectus supplement relating to the subscription rights offered thereby. Subscription rights may be exercised at any time up to the close of business on the expiration date for such subscription rights set forth in the prospectus supplement. After the close of business on the expiration date, all unexercised subscription rights would become void.

Subscription rights may be exercised as set forth in the prospectus supplement relating to the subscription rights offered thereby. Upon receipt of payment and the subscription rights certificate properly completed and duly executed at the corporate trust office of the subscription rights agent or any other office indicated in the prospectus supplement we will forward, as soon as practicable, the shares of common stock purchasable upon such exercise. To the extent permissible under applicable law, we may determine to offer any unsubscribed offered securities directly to persons other than stockholders, to or through agents, underwriters or dealers or through a combination of such methods, as set forth in the applicable prospectus supplement.

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DESCRIPTION OF DEBT SECURITIES

As required by U.S. federal law for all bonds and notes of companies that are publicly offered, our debt securities will be governed by a document called an indenture to be entered into between us and U.S. Bank National Association, a financial institution acting as trustee. The indenture is subject to and governed by the Trust Indenture Act of 1939, as amended. The following discussion sets forth the general terms and provisions relating to the indenture and, therefore, the debt securities.

Because this section is a summary, it does not describe every aspect of the debt securities. The indenture and its associated documents, including the debt securities, contain the full text of the matters described in this section and the prospectus supplement and pricing supplement, if any, accompanying this prospectus.

This summary is subject to and qualified in its entirety by reference to all the provisions of the indenture, including definitions of certain terms used in the indenture. In this summary, we describe the meaning of only some of the more important terms. Whenever we refer to particular sections or defined terms of the indenture in this prospectus or in the accompanying prospectus supplement, such sections or defined terms are incorporated by reference here or in the accompanying prospectus supplement. You must look to the indenture for the most complete description of what we describe in summary form in this prospectus and in the accompanying prospectus supplement.

This summary also is subject to and qualified by reference to the description of the particular terms of the series of debt securities described in the accompanying prospectus supplement. Those terms may vary from the terms described in this prospectus. The prospectus supplement relating to each series of debt securities will be attached to the front of this prospectus. There may also be a further prospectus supplement, known as a pricing supplement, which contains the precise terms of debt securities that are offered.

The trustee has two main roles. First, the trustee can enforce the rights of the holders of the debt securities (the “Noteholders”) against us if we default on our obligations under the terms of the indenture or the debt securities. There are some limitations on the extent to which the trustee acts on the Noteholders’ behalf, described later under “—Events of Default—Remedies if an Event of Default Occurs.” Second, the trustee performs administrative duties for us, such as sending the Noteholders interest and principal payments, transferring their debt securities to new buyers if they sell them, and sending them notices.

We may, in our discretion, issue several distinct series of debt securities, including notes, debentures, medium-term notes, commercial paper, retail notes or similar obligations evidencing indebtedness, under the indenture. The provisions of the indenture allow us not only to issue debt securities with terms different from those previously issued under the applicable indenture, but each series may be reopened and more debt securities of such series may be issued under the indenture, or under one or more supplements to the indenture. We may issue debt securities in amounts that exceed the total amount specified on the cover of a prospectus supplement at any time without consent or notice to the Noteholders.

This section summarizes terms of the debt securities that are common to all series and some other terms that may be applicable. Most of the specific legal, financial and other terms of each specific series of debt securities will be described in the prospectus supplement and pricing supplement, if any, accompanying this prospectus. Those terms may vary from the terms described here and may contain some or all of the following:

• the designation or title and series of such debt securities;

• the total principal amount of the series of debt securities;

• any limit on the aggregate principal amount of the series of debt securities, and whether or not such series may be reopened for additional debt securities of that series and on what terms;

• the purchase price of the debt securities, expressed as a percentage of the principal amount;

• the date or dates on which the principal will be payable or the method for determining the date or dates of maturity;

• if the debt securities will bear interest, the interest rate or rates or the method by which the rate or rates will be determined, the date or dates from which any interest will accrue, or the method by which such date or dates shall be determined, the interest payment dates, the record dates for those interest payments and the basis upon which interest shall be calculated or the method by which such date or dates shall be determined;

• if other than the location specified in this prospectus, the place or places where payments on the debt securities will be made and where the debt securities may be surrendered for registration of transfer or exchange;

• the terms for redemption, extension or early repayment. if any;

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• the provision for any sinking fund;

• the terms and conditions, if any, upon which the debt securities may be convertible into our preferred stock, common stock or other securities;

• the currency or currencies in which the debt securities are denominated and payable if other than U.S. dollars and the manner for determining the equivalent thereof;

• whether the amount of any payments on the debt securities may be determined with reference to an index, a financial or economic measure or pursuant to a formula and how such amounts are to be determined;

• if other than the entire principal amount, the portion of the principal amount of any debt securities that shall be payable upon declaration of acceleration of the maturity thereof or the method by which such portion shall be determined;

• whether the series of debt securities are issuable in certificate form;

• the identity of the security registrar and paying agent for the debt securities if other than the trustee;

• any deletions from, modifications of or additions to the events of default, covenants or other provisions in the indenture;

• whether the debt securities are subject to subordination and the terms of such subordination;

• the listing, if any, of the debt securities on a securities exchange;

• the applicability of the defeasance and covenant defeasance provisions of the indenture; and

• any other terms of the debt securities consistent with the provisions of the indenture not specified in this prospectus.

The prospectus supplement and pricing supplement, if any, accompanying this prospectus will also describe special federal income tax consequences of the debt securities, including any special U.S. federal income tax, accounting and other considerations.

General

The indenture permits us to issue debt securities from time to time and debt securities issued under the indenture will be issued as part of a series that has been established by us under such indenture. The debt securities will be unsecured and will rank equally with our other outstanding unsecured indebtedness as described under “—Ranking Compared to Other Creditors.”

Form, Exchange and Transfer

Unless we specify otherwise in the prospectus supplement or pricing supplement, if any, accompanying this prospectus, the debt securities will be issued only in fully registered form; without coupons; and in denominations that are even multiples of $1,000.

We will initially issue all debt securities in registered global form. While a debt security is held as a registered global security, only the depositary - i.e., DTC, as defined below under “—Book-Entry Debt Securities” - will be entitled to transfer and exchange the debt security, since the depositary will be the sole holder of the debt security. You will own beneficial interests in a global security through a participant in the depositary’s securities clearance system, and your rights as such an indirect owner will be governed solely by the applicable procedures of the depositary and its participants. We describe book-entry procedures below under “—Book-Entry Debt Securities.”

Noteholders may have their debt securities broken into more debt securities of smaller denominations or combined into fewer debt securities of larger denominations, as long as the denomination is authorized and the total principal amount is not changed. Any of these events is called an “exchange.” Whenever any securities are surrendered for exchange, we and the trustee will execute, authenticate and deliver the debt securities that the Noteholders are entitled to receive.

Noteholders may exchange or transfer their debt securities at the office of the registrar, which may also be the trustee. The registrar acts as our agent for registering debt securities in the names of holders and for transferring and exchanging debt securities, as well as maintaining the list of registered holders.

We can designate additional registrars or paying agents and they would be named in the prospectus supplement or the pricing supplement, if any, accompanying this prospectus. We may cancel the designation of any particular registrar or paying agent. We may also approve a change in the office through which any registrar or paying agent acts. The trustee may act as the registrar, the paying agent or both.

Noteholders will not be required to pay a service charge to transfer or exchange debt securities, but may be required to pay

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for any tax or other governmental charge associated with the exchange or transfer. The transfer or exchange will only be made if the registrar is satisfied with the Noteholders proof of ownership.

At certain times, Noteholders may not be able to transfer or exchange their debt securities. If the debt securities are redeemable and we redeem any series of such debt securities, or any part of any such series, then we may prevent the Noteholders from transferring or exchanging these debt securities. We may do this during the period beginning 15 calendar days before the day we mail the notice of redemption and ending on the day of that mailing, in order to freeze the list of holders so we can prepare the mailing. We may also refuse to register transfers or exchanges of debt securities selected for redemption, except that we will continue to permit transfers and exchanges of the unredeemed portion of any debt security being partially redeemed.

The rules for exchange described above apply to exchange of debt securities for other debt securities of the same series and kind. If a debt security is convertible, exercisable or exchangeable into or for a different kind of security, such as one that we have not issued, or for other property, the rules governing that type of conversion, exercise or exchange will be described in the accompanying prospectus supplement.

Payment and Paying Agents

We will pay interest to a Noteholder if the Noteholder is a direct holder listed in the registrar’s records at the close of business on a particular day in advance of each due date for interest, even if the Noteholder no longer owns the security on the interest due date. That particular day, usually about two weeks in advance of the interest due date, is called the “record date” and will be stated in the prospectus supplement and pricing supplement, if any, accompanying this prospectus. Because we will pay all the interest for an interest period to the Noteholder on the record date, holders buying and selling securities must work out between themselves the appropriate purchase price. The most common manner is to adjust the sales price of the securities to prorate interest fairly between buyer and seller. This prorated interest amount is called “accrued interest.”

We will pay interest, principal and any other money due on the debt securities at the corporate trust office of the trustee in the United States. We may also choose to pay interest by mailing checks. “Book-entry” and other indirect holders of debt securities should consult their banks, brokers or other financial institutions for information on how they will receive payments. We will provide additional information and specifics regarding the payment of interest, principal and any other sums due in the applicable prospectus supplement, or pricing supplement, if any, accompanying this prospectus.

We may also arrange for additional payment offices, and may cancel or change these offices, including our use of the trustee’s corporate trust office. These offices are called “paying agents.” We may also choose to act as our own paying agent or choose one of our subsidiaries to do so. We must notify holders of changes in the paying agents for any particular series of debt securities.

Notices

We and the trustee will send notices regarding the debt securities only to direct holders, using their addresses as listed in the trustee’s records.

Regardless of who acts as paying agent, all money that we forward to a paying agent that remains unclaimed will, at our request, be repaid to the trustee at the end of two years after the amount was due to the direct holder. After that two-year period, Noteholders may look only to the trustee for payment and not to us or any other paying agent.

Special Situations

Mergers and Similar Transactions. Under the terms of the indenture, we are generally permitted to consolidate or merge with another entity. We are also permitted to sell substantially all of our assets to another entity or to buy substantially all of the assets of another entity. However, we may not consolidate or merge with another entity or convey, transfer or lease our properties or assets substantially as an entirety or permit another entity to consolidate or merge with us unless all the following conditions are met:

• where we merge out of existence or sell our assets, the resulting entity must agree to be legally responsible for our obligations under the debt securities;

• alternatively, we must be the surviving entity;

• immediately after the transaction no event of default will exist; and

• we have delivered to the trustee a certificate of an officer and an opinion of counsel, each stating that the transaction complies with the indenture and that all conditions precedent to the transaction set forth in the indenture have been satisfied.

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Modification or Waiver. Under certain circumstances, we can make changes to the indenture and the debt securities. Some types of changes require the approval of each Noteholder affected thereby, some require approval by a majority vote with respect to each affected series of debt securities and some changes do not require any approval at all.

Changes Requiring Specific Approval of Noteholders. First, there are changes that cannot be made to the debt securities without specific approval from the Noteholders. The following is a list of those types of changes:

• changing the stated maturity of the principal of or interest on such debt security;

• reducing the principal amount of, or rate of interest on, such debt security, including the amount payable upon acceleration of the maturity of that security;

• changing the place or currency of any payment on such debt security;

• impairing the right to sue for payment on or with respect to such debt security;

• reducing the percentage of outstanding debt securities that must consent to a modification or amendment of the indenture;

• reducing the percentage of outstanding debt securities that must consent to a waiver of compliance with certain provisions of the indenture, including provisions relating to quorum or voting or for waiver of certain defaults;

• making any change to this list of changes that requires specific approval from the Noteholders.

Changes Requiring a Majority Vote of the Holders of a Series of Debt Securities. The second type of change to the indenture and the debt securities is the kind that requires a vote in favor of such change by Noteholders owning not less than a majority of the principal amount of the particular series affected. The changes falling in this category are not expressly stated and include those changes that do not require specific approval of Noteholders, as well as changes that do not fall into the category of changes that do not require any approval.

Changes Not Requiring Approval of Noteholders. The third type of change does not require any vote by Noteholders. This type is limited to clarifications and certain other changes that would not adversely affect Noteholders in any material respect.

Further Details Concerning Voting. Debt securities will not be considered outstanding, and therefore not eligible to vote, if we have deposited or set aside in trust for Noteholders money for their payment or redemption. A debt security does not cease to be outstanding because we or an affiliate of us is holding the debt security, but will be deemed not outstanding in determining whether the holders of the requisite amount of debt securities have acted under the indenture.

We will generally be entitled to set any day as a record date for the purpose of determining the holders of outstanding securities that are entitled to vote or take other action under the indenture. However, the indenture does not oblige us to fix any record date at all. If we set a record date for a vote or other action to be taken by holders of a particular series, that vote or action may be taken only by holders of outstanding debt securities of that series on the record date, whether or not such persons remain holders after such record date, and must be taken within 180 days following the record date.

“Book-entry” and other indirect holders should consult their banks, brokers or other financial institutions for information on how approval may be granted or denied if we seek to change the indenture or the debt securities or request a waiver.

Defeasance and Covenant Defeasance. When we establish a series of debt securities, we may provide that the series be subject to the defeasance and discharge provisions of the indenture. If those provisions are made applicable, we may elect either:

• to defease and be discharged from, subject to some limitations, all of our obligations with respect to those debt securities; or

• to be released from our obligations to comply with specified covenants relating to those debt securities as described in the applicable prospectus supplement.

To effect the defeasance or covenant defeasance, we must irrevocably deposit in trust with the relevant trustee an amount in any combination of funds or government obligations, which, through the payment of principal and interest in accordance with their terms, will provide money sufficient to make payments on those debt securities and any mandatory sinking fund or analogous payments on those debt securities.

On such a defeasance, we will not be released from obligations:

• to indemnify the trustee;

• to pay additional amounts, if any, upon the occurrence of some events;

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• to register the transfer or exchange of those debt securities;

• to replace some of those debt securities;

• to maintain an office or agency relating to those debt securities; or

• to hold moneys for payment in trust.

To establish such a trust we must, among other things, deliver to the relevant trustee an opinion of counsel to the effect that the holders of those debt securities:

• will not recognize income, gain or loss for U.S. federal income tax purposes as a result of the defeasance or covenant defeasance; and

• will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if the defeasance or covenant defeasance had not occurred. In the case of defeasance, the opinion of counsel must be based upon a ruling of the IRS or a change in applicable U.S. federal income tax law occurring after the date of the applicable indenture.

If we effect covenant defeasance with respect to any debt securities, the amount on deposit with the relevant trustee will be sufficient to pay amounts due on the debt securities at the time of their stated maturity. However, those debt securities may become due and payable prior to their stated maturity if there is an event of default with respect to a covenant from which we have not been released. If that happens, the amount on deposit may not be sufficient to pay all amounts due on the debt securities at the time of the acceleration.

The applicable prospectus supplement may further describe the provisions, if any, permitting defeasance or covenant defeasance, including any modifications to the provisions described above.

Redemption. The indenture under which the debt securities are issued may permit us to redeem such debt securities. If so, we may be able to pay off the securities before their scheduled maturity. If we have this right with respect to your specific securities, the right will be outlined in the prospectus supplement and/or the applicable pricing supplement. It will also specify when we can exercise this right and how much we will have to pay in order to redeem the debt securities.

If we choose to redeem the debt securities, we or the trustee will mail written notice to the Noteholders not less than 20 days and not more than 50 days, unless otherwise specified in the applicable prospectus supplement and pricing supplement, if any, prior to redemption. Also, the Noteholders may be prevented from exchanging or transferring the debt securities when they are subject to redemption, as described under “—Form, Exchange and Transfer” above. In case any debt securities are to be redeemed in part only, the notice will provide that, upon surrender of such security, the Noteholders will receive, without a charge, a new debt security or debt securities of authorized denominations representing the principal amount of the remaining unredeemed debt securities.

Ranking Compared to Other Creditors

The debt securities are not secured by any of our property or assets. Accordingly, the Noteholders’ ownership of debt securities means the Noteholders are one of our unsecured creditors.

Unsecured debt securities will be issued under the indenture. The debt securities will rank equally in right of payment with one another, with all our other outstanding unsecured indebtedness, and with our future unsecured indebtedness.

Events of Default

Noteholders will have special rights if an event of default occurs and is not cured, as described later in this subsection.

What Is an Event of Default? The following constitute events of default under the indenture and with respect to any series of debt securities, unless otherwise specified in the applicable prospectus supplement, and pricing supplement, if any:

• we fail to make any interest payment on a debt security when it is due, and we do not cure this default within 30 days;

• we fail to make any payment of principal when it is due at the maturity of any security;

• we fail to deposit a sinking fund payment when due, and we do not cure this default within 5 days;

• we fail to comply with the indenture in any material respect, and after we have been notified of the default by the trustee or holders of 25% in principal amount of the series, we do not cure the default within 60 days;

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• we file for bankruptcy, or other events in bankruptcy, insolvency or reorganization occur and remain undischarged or unstayed for a period of 60 days;

• on the last business day of each of twenty-four consecutive calendar months, we have an asset coverage of less than 100 per centum; or

• any other event of default described in the applicable prospectus supplement with respect to any particular series of debt securities occurs.

Remedies if an Event of Default Occurs. Noteholders will have the following remedies if an event of default occurs:

Acceleration. If an event of default other than an event of default relating to events in bankruptcy, insolvency or reorganization has occurred and has not been cured or waived, then the trustee or the holders of not less than 25% in principal amount of the securities of the affected series may declare the entire principal amount of and any and all accrued and unpaid interest on all the securities of that series to be due and immediately payable. An acceleration of maturity may be cancelled by the holders of at least a majority in principal amount of the debt securities of the affected series, if all events of default have been cured or waived and certain other conditions are satisfied.

If an event of default relating to events in bankruptcy, insolvency or reorganization has occurred, all unpaid principal and accrued and unpaid interest, and liquidated damages, if any, become immediately due and payable without any declaration or other act of the trustee or any holder.

Special Duties of Trustee. If an event of default occurs, the trustee will have some special duties. In that situation, the trustee will be obligated to use those of its rights and powers under the indenture, and to use the same degree of care and skill in doing so, that a prudent person would use in that situation in conducting his or her own affairs.

Majority Noteholders May Direct the Trustee to Take Actions to Protect Their Interests. The trustee is not required to take any action under the indenture at the request of any Noteholders unless the Noteholders offer the trustee reasonable protection from expenses and liability. This is called an “indemnity.” If the trustee is provided with an indemnity reasonably satisfactory to it, the holders of a majority in principal amount of the relevant series of debt securities may direct the time, method and place of conducting any lawsuit or other formal legal action seeking any remedy available to the trustee. These majority Noteholders may also direct the trustee in performing any other action under the indenture.

Individual Actions Noteholders May Take if the Trustee Fails to Act. Before Noteholders can bypass the trustee and bring their own lawsuit or other formal legal action or take other steps to enforce their rights or protect their interests relating to the debt securities, the following must occur:

• Noteholders must give the trustee written notice that an event of default has occurred and remains uncured;

• the holders of 25% in principal amount of all outstanding debt securities of the relevant series must make a written request that the trustee take action because of the default, and must offer reasonable indemnity to the trustee against the costs, expenses and other liabilities of taking that action;

• the trustee must not have taken action for 60 days after receipt of the above notice and offer of indemnity; and

• during the 60-day period, the holders of a majority in principal amount of the debt securities of that series do not give the trustee a direction inconsistent with the request.

However, Noteholders are entitled at any time to bring an individual lawsuit for the payment of the money due on their debt securities on or after its due date.

“Book-entry” and other indirect holders should consult their banks, brokers or other financial institutions for information on how to give notice or direction to or make a request of the trustee and to make or cancel a declaration of acceleration.

Waiver of Default. The holders of a majority in principal amount of the relevant series of debt securities may waive a default for the debt securities of that series. If this happens, the default will be treated as if it has not occurred. No one can waive a payment default on a Noteholder’s debt security, however, without the Noteholder’s individual approval.

We Will Give the Trustee Information About Defaults Periodically

Within 120 calendar days after the end of each fiscal year we will give to the trustee a written statement of one of our officers certifying that to the best of his or her knowledge we are in compliance with the indenture and the debt securities, or else specifying any default. The trustee may withhold notice of any uncured default from the Noteholders, except for payment defaults,

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if it determines that withholding notice is in the Noteholders’ interest.

Certain Covenants

The indenture under which the debt securities are issued will require us to, unless otherwise specified in the applicable prospectus supplement and pricing supplement, if any:

• duly and punctually pay the principal of and any premium and interest on the debt securities of each series in accordance with the terms of the debt securities and the indenture;

• maintain an office or agency where the debt securities may be presented or surrendered for payment, registration of transfer or exchange, and where notices and demands to or upon us regarding the securities and the indenture may be served;

• if we act as our own paying agent at any time, segregate and hold in trust, for the benefit of the holders, an amount of money, in the currency in which the securities are payable, sufficient to pay the principal and any premium or interest due on the securities of any series on or before the due date for such payment;

• do all things necessary to preserve and keep in full force and effect our existence, rights (charter and statutory) and franchises unless failure to do so would not disadvantage the Noteholders in any material respect;

• deliver an officers’ certificate to the trustee, within 120 calendar days after the end of each fiscal year, stating whether or not, to the best knowledge of the persons signing the officers’ certificate, we are in default in the performance and observance of any of the terms, provisions and conditions of the indenture and, if we are, specifying all such defaults and the nature and status thereof of which we may have knowledge;

• maintain, preserve, and keep our material properties that are used in the conduct of our business in good repair, condition and working order, ordinary wear and tear excepted; and

• pay or discharge when due all taxes, assessments and governmental charges levied or imposed upon us or our income, profits or property, as well as all lawful claims for labor, materials and supplies that, if unpaid, might by law become a lien upon our property, except those contested in good faith or that would not have a material adverse effect on us.

Governing Law

The indenture and the debt securities will be governed by, and construed in accordance with, the laws of the State of New York.

Book-Entry Debt Securities

Unless otherwise indicated in the prospectus supplement, the Depository Trust Company, or DTC, will act as securities depository for the debt securities. The debt securities will be issued as fully-registered securities in the name of Cede & Co. (DTC’s partnership nominee) or such other name as may be requested by an authorized representative of DTC. This means that certificates will not be issued to each holder of debt securities. One fully-registered certificate will be issued for the debt securities, in the aggregate principal amount of such issue, and will be deposited with DTC.

Purchases of debt securities under the DTC system must be made by or through participants (for example, brokers), who will receive credit for the debt securities on DTC’s records. The ownership interest of each actual purchaser of each debt security will be recorded on the records of the participant. Beneficial owners of the debt securities will not receive written confirmation from DTC of their purchase. Beneficial owners are, however, expected to receive written confirmations providing details of the transaction, as well as periodic statements of their holdings, from the participant through which the beneficial owner entered into the transaction. Transfers of ownership interests in the debt securities are to be accomplished by entries made on the books of participants acting on behalf of beneficial owners. Beneficial owners will not receive certificates representing their ownership interests in the debt securities, except in the event that use of the book-entry system for the debt securities is discontinued.

To facilitate subsequent transfers, all debt securities deposited by participants with DTC are registered in the name of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of DTC. The deposit of debt securities with DTC and their registration in the name of Cede & Co. or such other DTC nominee do not effect any change in beneficial ownership. DTC has no knowledge of the actual beneficial owners of the debt securities; DTC’s records reflect only the identity of the participants to whose accounts such debt securities are credited, which may or may not be the beneficial owners. The participants will remain responsible for keeping account of their holdings on behalf of their customers.

Conveyance of notices and other communications by DTC to participants and by participants to beneficial owners will be

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governed by arrangements among them, subject to statutory or regulatory requirements as may be in effect from time to time.

Proceeds, distributions or other payments on the debt securities will be made to Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is to credit participants’ accounts, upon DTC’s receipt of funds in accordance with their respective holdings shown on DTC’s records. Payments by participants to beneficial owners will be governed by standing instructions and customary practices, as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” and will be the responsibility of such participant and not of DTC nor its nominee, the trustee, or us, subject to any statutory or regulatory requirements as may be in effect from time to time.

DTC may discontinue providing its services as depository with respect to the debt securities at any time by giving reasonable notice to us or to the trustee. Under such circumstances, in the event that a successor securities depository is not obtained, certificates representing the debt securities are required to be printed and delivered. We may decide to discontinue use of the system of book-entry-only transfers through DTC (or a successor depository). In that event, certificates representing the debt securities will be printed and delivered.

DTC is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act. DTC holds and provides asset servicing for over 2.5 million issues of U.S. and non-U.S. equity, corporate and municipal debt issues, and money market instruments from over 100 countries that DTC’s participants deposit with DTC. DTC also facilitates the post-trade settlement among participants of sales and other securities transactions in deposited securities, through electronic computerized book-entry transfers and pledges between participants’ accounts. This eliminates the need for physical movement of securities certificates. Participants include both U.S. and non-U.S. securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. DTC has Standard & Poor’s highest rating, AAA. The DTC Rules applicable to its participants are on file with the SEC. More information about DTC can be found at www.dtcc.com and www.dtc.org.

The information in this section concerning DTC and DTC’s book-entry system has been obtained from sources that we believe to be reliable, but we take no responsibility for the accuracy thereof.

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CERTAIN PROVISIONS OF THE MARYLAND GENERAL CORPORATION LAW

AND OUR CHARTER AND BYLAWS

The following is a summary of certain provisions of Maryland law and our charter and bylaws. This summary does not purport to be complete and is qualified in its entirety by reference to the MGCL, our charter and our bylaws. The forms of our charter and bylaws are filed as exhibits to the registration statement of which this prospectus is a part. See “Additional Information.”

Our Board of Directors

Our charter and bylaws provide that the number of directors we have may be established only by our Board of Directors but may never be less than the minimum number required by the MGCL, and our bylaws provide that the number of our directors may not be more than 15. Our bylaws also provide that the number of directors shall not be increased by 50% or more in any twelve-month period without the approval of at least 66% of the entire Board of Directors. Subject to the terms of any class or series of preferred stock, vacancies on our Board of Directors may be filled only by a majority of the remaining directors, even if the remaining directors do not constitute a quorum, and any director elected to fill a vacancy will hold office for the remainder of the full term of the directorship in which the vacancy occurred and until his or her successor is duly elected and qualifies.

Each of our directors is elected by our stockholders to serve until the next annual meeting of our stockholders and until his or her successor is duly elected and qualifies. Holders of shares of common stock will have no right to cumulative voting in the election of directors. Our bylaws provide that a nominee for director shall be elected as a director only if such nominee receives the affirmative vote of a majority of the total votes cast for and against such nominee at a meeting of stockholders duly called and at which a quorum is present, unless there is a contested election, in which case, directors will be elected by a plurality of the votes cast. Consequently, at each annual meeting of our stockholders, the holders of a majority of the shares of common stock entitled to vote will be able to elect all of our directors.

Removal of Directors

Our charter provides that, subject to the rights of holders of one or more classes or series of preferred stock to elect or remove one or more directors, a director may be removed only for cause (as defined in our charter) and only by the affirmative vote of at least two-thirds of the votes entitled to be cast generally in the election of directors. This provision, when coupled with the exclusive power of our Board of Directors to fill vacancies on our Board of Directors, precludes stockholders from removing incumbent directors except for cause and upon a substantial affirmative vote and filling the vacancies created by such removal with their own nominees.

Business Combinations

Under the MGCL, certain “business combinations” (including a merger, consolidation, statutory share exchange or, in certain circumstances, an asset transfer or issuance or reclassification of equity securities) between a Maryland corporation and an interested stockholder (defined generally as any person who beneficially owns, directly or indirectly, 10% or more of the voting power of the corporation’s outstanding voting stock or an affiliate or associate of the corporation who, at any time during the two-year period immediately prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then-outstanding stock of the corporation) or an affiliate of such an interested stockholder are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. Thereafter, any such business combination must generally be recommended by the board of directors of the corporation and approved by the affirmative vote of at least (a) 80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation and (b) two-thirds of the votes entitled to be cast by holders of voting stock of the corporation, other than shares held by the interested stockholder with whom (or with whose affiliate) the business combination is to be effected or held by an affiliate or associate of the interested stockholder, unless, among other conditions, the corporation’s common stockholders receive a minimum price (as defined in the MGCL) for their shares and the consideration is received in cash or in the same form as previously paid by the interested stockholder for its shares. A person is not an interested stockholder under the statute if the board of directors approved in advance the transaction by which the person otherwise would have become an interested stockholder. A corporation’s board of directors may provide that its approval is subject to compliance with any terms and conditions determined by the board of directors.

Pursuant to the statute, our Board of Directors has by resolution exempted business combinations between us and American Capital and its affiliates, and between us and any other person, provided that in the latter case the business combination is first approved by our Board of Directors (including a majority of our directors who are not interested persons as defined in the 1940 Act). Consequently, the five-year prohibition and the supermajority vote requirements will not apply to business combinations between us and any person described above, and, as a result, any person described above may be able to enter into business combinations with us that may not be in the best interest of our stockholders, without compliance with the supermajority vote requirements and other provisions of the statute. We cannot assure you that our Board of Directors will not amend or repeal this resolution in the future.

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Control Share Acquisitions

The MGCL provides that a holder of “control shares” of a Maryland corporation acquired in a “control share acquisition” has no voting rights with respect to such shares except to the extent approved by the affirmative vote of at least two-thirds of the votes entitled to be cast by stockholders entitled to vote generally in the election of directors other than the person who has made or proposes to make the control share acquisition, an officer of the corporation or an employee of the corporation who is also a director of the corporation.

“Control shares” are voting shares of stock that, if aggregated with all other such shares of stock owned by the acquirer, or in respect of which the acquirer is able to exercise or direct the exercise of voting power (except solely by virtue of a revocable proxy), would entitle the acquirer to exercise voting power in electing directors within one of the following ranges of voting power:

• one-tenth or more but less than one-third;

• one-third or more but less than a majority; or

• a majority or more of all voting power.

Control shares do not include shares that the acquiring person is then entitled to vote as a result of having previously obtained stockholder approval or shares acquired directly from the corporation. A “control share acquisition” means the acquisition of issued and outstanding control shares, subject to certain exceptions.

A person who has made or proposes to make a control share acquisition, upon satisfaction of certain conditions (including an undertaking to pay expenses and making an “acquiring person statement” as described in the MGCL), may compel the board of directors to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the shares. If no request for a meeting is made, the corporation may itself present the question at any stockholders meeting.

If voting rights are not approved at the meeting or if the acquiring person does not deliver an “acquiring person statement” as required by the statute, then, subject to certain conditions and limitations, the corporation may redeem for fair value any or all of the control shares (except those for which voting rights have previously been approved). Fair value is determined, without regard to the absence of voting rights for the control shares, as of the date of the last control share acquisition by the acquirer or, if a meeting of stockholders is held at which the voting rights of such shares are considered and not approved, as of the date of the meeting. If voting rights for control shares are approved at a stockholders’ meeting and the acquirer becomes entitled to vote a majority of the shares entitled to vote, all other stockholders may exercise appraisal rights, unless our charter or bylaws provide otherwise. The fair value of the shares as determined for purposes of such appraisal rights may not be less than the highest price per share paid by the acquirer in the control share acquisition.

The control share acquisition statute does not apply to shares acquired in a merger, consolidation or statutory share exchange if the corporation is a party to the transaction or acquisitions approved or exempted by the charter or bylaws of the corporation. Our bylaws contain a provision exempting from the control share acquisition statute any and all acquisitions by any person of shares of our stock. This provision could be amended or eliminated at any time in the future by our Board of Directors. However, so long as we are a BDC, we will amend our bylaws to be subject to the control share acquisition statute only if our Board of Directors determines that it would be in our best interests based on our determination that our being subject to the control share acquisition statute does not conflict with the 1940 Act.

Subtitle 8

Subtitle 8 of Title 3 of the MGCL permits a Maryland corporation with a class of equity securities registered under the Exchange Act and at least three independent directors to elect to be subject, by provision in its charter or bylaws or a resolution of its board of directors and notwithstanding any contrary provision in the charter or bylaws, to any or all of five provisions of the MGCL which provide, respectively, for:

• a classified board;

• a two-thirds vote requirement for removing a director;

• a requirement that the number of directors be fixed only by vote of the board of directors;

• a requirement that a vacancy on the board of directors be filled only by the remaining directors in office and (if the board is classified) for the remainder of the full term of the class of directors in which the vacancy occurred; and

• a majority requirement for the calling of a stockholder-requested special meeting of stockholders.

Our charter provides that, at such time as we are able to make a Subtitle 8 election, vacancies on our Board of Directors may be filled only by the remaining directors, and any director elected to fill a vacancy will serve for the remainder of the full term of the directorship in which such vacancy occurred and until a successor is elected and qualifies. Through provisions in our charter and bylaws unrelated to Subtitle 8, we already (1) require the affirmative vote of stockholders entitled to cast not less than two-thirds of all of the votes entitled to be cast generally in the election of directors for the removal of any director from our Board of Directors, which may also only be for cause, (2) vest in the board the exclusive power to fix the number of directorships and

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(3) require, unless called by our Chair of the Board, our chief executive officer, or our Board of Directors, the written request of stockholders entitled to cast a majority of all votes entitled to be cast at such a meeting to call a special meeting.

Meetings of Stockholders

Pursuant to our bylaws, a meeting of our stockholders for the election of directors and the transaction of any business is held annually on a date and at the time and place set by our Board of Directors. The Chair of our Board of Directors, our chief executive officer, or our Board of Directors may call a special meeting of our stockholders. Subject to the provisions of our bylaws, a special meeting of our stockholders to act on any matter that may properly be brought before a meeting of our stockholders must also be called by our Secretary upon the written request of the stockholders entitled to cast a majority of all the votes entitled to be cast on such matter at the meeting and containing the information required by our bylaws. Our Secretary will inform the requesting stockholders of the reasonably estimated cost of preparing and delivering the notice of meeting (including our proxy materials), and the requesting stockholder must pay such estimated cost before our Secretary is required to prepare and deliver the notice of the special meeting.

Advance Notice of Director Nominations and New Business

Our bylaws provide that, with respect to an annual meeting of our stockholders, nominations of individuals for election to our Board of Directors and the proposal of other business to be considered by our stockholders may be made only (1) pursuant to our notice of the meeting, (2) by or at the direction of our Board of Directors or (3) by any stockholder who was a stockholder of record both at the time of giving the notice required by our bylaws and at the time of the meeting, who is entitled to vote at the meeting on such business or in the election of such nominee and has provided notice to us within the time period, and containing the information and other materials, specified in the advance notice provisions of our bylaws.

With respect to special meetings of stockholders, only the business specified in our notice of meeting may be brought before the meeting. Nominations of individuals for election to our Board of Directors may be made only (1) by or at the direction of our Board of Directors or (2) provided that the meeting has been called for the purpose of electing directors, by any stockholder who was a stockholder of record both at the time of giving the notice required by our bylaws and at the time of the meeting, who is entitled to vote at the meeting in the election of each such nominee and has provided notice to us within the time period, and containing the information and other materials, specified in the advance notice provisions of our bylaws.

Director Resignation Policy

Our bylaws require a candidate in an uncontested election for director to receive a majority of the votes cast in order to be elected as a director. Under this provision, each vote is specifically counted “for” or “against” the director’s election, unless a common stockholder abstains from voting with respect to the matter. Thus, a director nominee is required to receive more votes “for” than “against” to be elected. Pursuant to Maryland law, a director shall remain in office until his or her successor is elected and qualifies, even if the director has not received a vote sufficient for re-election. Thus, a company could have a “holdover” director. However, pursuant to our director resignation policy that our Board of Directors has approved, an incumbent director must tender his or her resignation to our Board of Directors if the director is nominated but not re-elected. The policy also requires our Compensation and Corporate Governance Committee to make a recommendation to our full Board of Directors on whether to accept or reject the resignation, and our full Board of Directors to make that determination. Our Board of Directors will publicly disclose its decision within 90 days after receipt of the tendered resignation.

Any director who tenders his or her resignation pursuant to this policy may not participate in the Compensation and Corporate Governance Committee recommendation or Board of Directors action regarding whether to accept the resignation offer. If each member of the Compensation and Corporate Governance Committee does not receive a vote sufficient for re-election, then the independent directors who did not fail to receive a sufficient vote shall appoint a committee among themselves to consider the resignation offers and recommend to the Board of Directors whether to accept them. If the only directors who did not fail to receive a sufficient vote for re-election constitute three or fewer directors, all directors may participate in the action regarding whether to accept the resignation offers.

Indemnification and Limitation of Liability of Directors and Officers

Maryland law permits a Maryland corporation to include in its charter a provision limiting the liability of its directors and officers to the corporation and its stockholders for money damages, except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty that is established by a final judgment and is material to the cause of action. Our charter contains a provision that eliminates the liability of our directors and officers to the maximum extent permitted by Maryland law.

The MGCL requires us (unless our charter provides otherwise, which our charter does not) to indemnify a director or officer who has been successful, on the merits or otherwise, in the defense of any proceeding to which he or she is made a party by reason of his or her service in that capacity. The MGCL permits us to indemnify our present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection

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with any proceeding to which they may be made or threatened to be made a party by reason of their service in those or other capacities unless it is established that:

• the act or omission of the director or officer was material to the matter giving rise to the proceeding and (1) was committed in bad faith or (2) was the result of active and deliberate dishonesty;

• the director or officer actually received an improper personal benefit in money, property or services; or

• in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful.

Under the MGCL, we may not indemnify a director or officer in a suit by us or on our behalf in which the director or officer was adjudged liable to us or in a suit in which the director or officer was adjudged liable on the basis that personal benefit was improperly received. A court may order indemnification if it determines that the director or officer is fairly and reasonably entitled to indemnification, even though the director or officer did not meet the prescribed standard of conduct or was adjudged liable on the basis that personal benefit was improperly received. However, indemnification for an adverse judgment in a suit by us or on our behalf, or for a judgment of liability on the basis that personal benefit was improperly received, is limited to expenses.

In addition, the MGCL permits us to advance reasonable expenses to a director or officer upon our receipt of:

• a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by us; and

• a written undertaking by or on behalf of the director or officer to repay the amount paid or reimbursed by us if it is ultimately determined that the director or officer did not meet the standard of conduct.

Our charter authorizes us to obligate ourselves, and our bylaws obligate us, to the maximum extent permitted by Maryland law in effect from time to time, to indemnify and, without requiring a preliminary determination of the ultimate entitlement to indemnification, pay or reimburse reasonable expenses in advance of final disposition of a proceeding to:

• any present or former director or officer who is made or threatened to be made a party to a proceeding by reason of his or her service in that capacity; or

• any individual who, while a director or officer of our company and at our request, serves or has served as a director, officer, partner, manager, member or trustee of another corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or any other enterprise and who is made or threatened to be made a party to the proceeding by reason of his or her service in that capacity.

Our charter and bylaws also permit us to indemnify and advance expenses to any person who served a predecessor of ours in any of the capacities described above and any employee or agent of our company or a predecessor of our company. These provisions on indemnification and limitation of liability are subject to the limitations of the 1940 Act that prohibit us from protecting any director or officer against any liability to us or our stockholders arising from willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office.

Forum Selection Clause

Our bylaws provide that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (a) any derivative action or proceeding brought on our behalf, (b) any action asserting a claim of breach of any duty owed by us or by any of our directors or officers or other employees to us or to our stockholders, (c) any action asserting a claim against us or any of our directors or officers or other employees arising pursuant to any provision of the MGCL or our charter or bylaws or (d) any action asserting a claim against us or any of our directors or officers or other employees that is governed by the internal affairs doctrine shall be, in each case, the Circuit Court for Montgomery County, Maryland, or, if that Court does not have jurisdiction, the United States District Court for the District of Maryland, Baltimore Division.

Effects of Certain Provisions of Maryland Law and of Our Charter and Bylaws

Our charter and bylaws and Maryland law contain provisions that may delay, defer or prevent a change in control or other transaction that might involve a premium price for shares of our common stock or otherwise be in the best interests of our stockholders, including business combination provisions, supermajority vote requirements and advance notice requirements for director nominations and stockholder proposals. Likewise, if the provision in our bylaws opting out of the control share acquisition provisions of the MGCL were rescinded or if we were to opt in to the classified board or other provisions of Subtitle 8, these provisions of the MGCL could have similar anti-takeover effects.

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REGULATION

Business Development Company Requirements

We are an externally managed, non-diversified closed-end management investment company that intends to be treated as a RIC under the Code. We have elected to be regulated as a BDC under the 1940 Act. The 1940 Act contains prohibitions and restrictions relating to transactions between BDCs and their affiliates (including any investment advisors), principal underwriters and affiliates of those affiliates or underwriters and requires that a majority of the directors of a BDC be persons other than “Interested Persons,” as that term is defined in the 1940 Act. In addition, the 1940 Act provides that we may not change the nature of our business so as to cease to be, or to withdraw our election as, a BDC unless approved by a majority of our outstanding voting securities. We may invest up to 100% of our assets in securities acquired directly from issuers in privately negotiated transactions. With respect to such securities, we may, for the purpose of public resale, be deemed an “underwriter” as that term is defined in the Securities Act. Our intention is to not write (sell) or buy put or call options to manage risks associated with the publicly traded securities of our portfolio companies, except that we may enter into hedging transactions to manage the risks associated with interest rate currency fluctuations.

However, we may purchase or otherwise receive warrants to purchase the common stock of our portfolio companies in connection with acquisition financing or other investments. Similarly, in connection with an acquisition, we may acquire rights to require the issuers of acquired securities or their affiliates to repurchase them under certain circumstances. We also do not intend to acquire securities issued by any investment company that exceed the limits imposed by the 1940 Act. Under these limits, we generally cannot acquire more than 3% of the total outstanding voting stock of any registered investment company, invest more than 5% of the value of our total assets in the securities of one investment company or invest, in the aggregate, more than 10% of the value of our total assets in the securities of more than one investment company. With regard to that portion of our portfolio invested in securities issued by investment companies, it should be noted that such investments might subject our stockholders to additional expenses. None of these policies is fundamental and may be changed without stockholder approval.

We are also required to provide and maintain a bond issued by a reputable fidelity insurance company to protect us against larceny and embezzlement. Furthermore, as a BDC, we are prohibited from protecting any director or officer against any liability to us or our stockholders arising from willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office.

Qualifying Assets

As a BDC, we may not acquire any asset other than certain qualifying assets described in the 1940 Act, unless, at the time the acquisition is made, the value of such qualifying assets represent at least 70% of the value of our total assets. The principal categories of qualifying assets relevant to our business include the following:

• securities purchased in transactions not involving any public offering from:

(a) an issuer that (i) is organized and has its principal place of business in the United States, (ii) is neither an investment company other than a wholly-owned small business investment company nor an entity that would be an investment company but for certain statutory exemptions, and (iii) does not have any class of securities listed on a national securities exchange with a market capitalization in excess of $250 million; or

(b) an issuer that satisfies the criteria set forth in clauses (a) (i) and (ii) above but not clause (a)(iii), so long as, at the time of purchase, we own at least 50% of (i) the greatest amount of equity securities of the issuer, including securities convertible into such securities and (ii) the greatest amount of certain debt securities of such issuer, held by us at any point in time during the period when such issuer was an eligible portfolio company, except that options, warrants, and similar securities which have by their terms expired and debt securities which have been converted, or repaid or prepaid in the ordinary course of business or incident to a public offering of securities of such issuer, shall not be considered to have been held by us, and we are one of the 20 largest holders of record of such issuer’s outstanding voting securities;

• securities of an issuer described in clauses (a)(i) and (ii) above with respect to which we control (alone or together as a part of a group), we in fact exercise a controlling influence over such issuer’s management or policies and a person affiliated with us is on the issuer’s Board of Directors;

• securities received in exchange for or distributed with respect to securities described above, or pursuant to the exercise of options, warrants or rights relating to such securities; and

• cash, cash items, U.S. government securities, or high quality debt securities maturing in one year or less from the time of investment.

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Managerial Assistance to Portfolio Companies

In order to count portfolio securities as qualifying assets for the purpose of the 70% test, we must either control the issuer of the securities or must offer to make available to the issuer of the securities significant managerial assistance; except that, where we purchase such securities in conjunction with one or more other persons acting together, one of the other persons in the group may make available such managerial assistance. This assistance could involve monitoring the operations of our portfolio companies, participating in board and management meetings, consulting and advising officers of portfolio companies and providing other organizational and financial guidance. We may receive fees for these services and will reimburse our Manager for its allocated costs in providing such assistance, subject to the review and approval by our Board of Directors, including our independent directors.

Temporary Investments

Pending investment in other types of qualifying assets described in the 1940 Act, we may invest our funds in cash items, government securities, agency paper or high quality debt securities maturing in one year or less from the time of investment in such high quality debt investments. We refer to such assets and cash herein as temporary investments.

Leverage

We have, and intend to utilize, leverage on our investment portfolio. Our leverage may vary periodically depending on market conditions, our portfolio composition and our Manager’s assessment of risks and returns. We may finance our assets, subject to market conditions, through a combination of financing arrangements, including, but not limited to, warehouse facilities, securitizations and term financing facilities. The 1940 Act permits us, as a BDC, to issue senior securities in amounts such that our asset coverage is at least 200% after each issuance of senior securities. Asset coverage is defined in the 1940 Act as the ratio which the value of the total assets, less all liabilities and indebtedness not represented by senior securities, bears to the aggregate amount of senior securities representing indebtedness. Such indebtedness may also be incurred for the purpose of effecting share repurchases. As a result, we are exposed to the risks of leverage. As permitted by the 1940 Act, we may, in addition, borrow amounts up to 5% of our total assets for temporary purposes.

Under the 1940 Act, if a BDC has any senior debt securities outstanding that were publicly issued, the BDC must make provision to prohibit the declaration of any dividend (except a dividend payable in the stock of the BDC) if its asset coverage is below 200% at the time of the distribution after deducting the amount of such dividend.

Issuance of Stock

As a BDC, we are generally not able to issue and sell our common stock at a price below our NAV per share, exclusive of any distributing commission or discount, except (i) with the prior approval of a majority of our stockholders, (ii) in connection with a rights offering to our existing stockholders or (iii) under such other circumstances as the SEC may permit.

Code of Ethics

We and our Manager have each adopted the Code of Ethics that applies to our officers and directors and the officers and employees of our Manager, American Capital and its affiliates who provide services to us. Among other matters, our Code of Ethics is designed to deter wrongdoing and to promote honest and ethical conduct, including the ethical handling of conflicts of interest between personal and professional relationships; full, fair, accurate, timely and understandable disclosure in our SEC reports and other public communications; compliance with applicable governmental laws, rules and regulations; prompt internal reporting of violations of the code to appropriate persons identified in the code; and accountability for adherence to the code. Our Code of Ethics also establishes procedures for personal investments and restricts certain personal securities transactions pursuant to Rule 17j-1 under the 1940 Act. Personnel subject to the Code of Ethics may invest in securities for their personal investment accounts, including securities that may be purchased or held by us, so long as such investments are made in accordance with the Code of Ethics’ requirements. The Code of Ethics is available, free of charge, on our website at www.ACSF.com. In addition, the Code of Ethics is available on the SEC’s website at www.sec.gov. The public may read and copy the Code of Ethics at the SEC’s Public Reference Room in Washington, DC. You may obtain information on the operation of the Public Reference Room by calling the SEC at (202) 551-8090. A copy of our Code of Ethics can also be obtained, after paying a duplicating fee, by electronic request at the following email address: publicinfo@sec.gov, or by writing the SEC’s Public Reference Section at 100 F Street, N.E., Washington, D.C 20549.

Proxy Voting Policies and Procedures

Our investments do not generally entitle us to voting rights in our portfolio companies. We have delegated our proxy voting responsibility to our Manager for portfolio companies in which we may have voting rights. Our Manager has adopted proxy voting policies and procedures, which will be reviewed periodically by our Manager and our disinterested directors, and accordingly, are subject to change.

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As an investment adviser registered under the Advisers Act, our Manager has a fiduciary duty to act solely in the best interests of its clients. As part of this duty, our Manager recognizes that it must vote client securities in a timely manner free of conflicts of interest and in the best interests of its clients. Our Manager’s policies and procedures for voting proxies are intended to comply with Section 206 of, and Rule 206(4)-6 under, the Advisers Act.

Our Manager’s Policy

Under our Manager’s proxy voting policies and procedures, officers of our Manager will consult with each other and our senior investment team in determining how to vote, taking into account our and our stockholders’ interests, any potential conflicts of interest and any voting guidelines of our Manager. Our Manager will consult with legal counsel to identify potential conflicts of interest. Where a potential conflict of interest exists, our Manager may, if it so elects, resolve it by following the recommendation of a disinterested third-party, by seeking the direction of our disinterested directors or, in extreme cases, by abstaining from voting. While our Manager may retain an outside service to provide voting recommendations and to assist in analyzing votes, our Manager will not delegate its voting authority to any third-party.

An officer of our Manager will keep a written record of how all such proxies are voted. Our Manager will retain records of (i) proxy voting policies and procedures, (ii) all proxy statements received (or it may rely on proxy statements filed on the SEC’s EDGAR system in lieu thereof), (iii) all votes cast, (iv) investor requests for voting information and (v) any specific documents prepared or received in connection with a decision on a proxy vote. If it uses an outside service, our Manager may rely on such service to maintain copies of proxy statements and records, so long as such service will provide a copy of such documents promptly upon request. You may obtain information regarding how we voted proxies, free of charge, by making a written request for proxy voting information to: American Capital Senior Floating, Ltd., 2 Bethesda Metro Center, 14^th Floor, Bethesda, MD 20814 or by calling us collect at (301) 968-9310.

Sarbanes-Oxley Act of 2002

The Sarbanes-Oxley Act imposes a wide variety of regulatory requirements on publicly held companies and their insiders. Many of these requirements affect us. For example:

• pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, or the Exchange Act, our Chief Executive Officer and Chief Financial Officer must certify the accuracy of the financial statements contained in our periodic reports;

• pursuant to Item 307 of Regulation S-K, our periodic reports must disclose our conclusions about the effectiveness of our disclosure controls and procedures;

• pursuant to Rule 13a-15 of the Exchange Act, beginning with our fiscal year ending December 31, 2015, our management must prepare an annual report regarding its assessment of our internal control over financial reporting, which must be audited by our independent registered public accounting firm beginning with the first fiscal year in which we do not qualify as an emerging growth company; and

• pursuant to Item 308 of Regulation S-K and Rule 13a-15 of the Exchange Act, our periodic reports must disclose whether there were significant changes in our internal controls over financial reporting or in other factors that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

The Sarbanes-Oxley Act requires us to review our current policies and procedures to determine whether we comply with the Sarbanes-Oxley Act and the regulations promulgated thereunder. We will continue to monitor our compliance with all regulations that are adopted under the Sarbanes-Oxley Act and will take actions necessary to ensure that we are in compliance with that act.

JOBS Act

We are an “emerging growth company,” as defined in the Jumpstart our Business Startups Act of 2012 (the “JOBS Act”) until the earliest of:

• the last day of our fiscal year ending December 31, 2019;

• the last day of the fiscal year in which our total annual gross revenues first exceed $1 billion;

• the date on which we have, during the prior three-year period, issued more than $1 billion in non-convertible debt; or

• the last day of a fiscal year in which we (1) have an aggregate worldwide market value of our common stock held by non-affiliates of $700 million or more, computed at the end of each fiscal year as of the last business day of our most recently completed second fiscal quarter and (2) have been an Exchange Act reporting company for at least one year (and filed at least one annual report under the Exchange Act).

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Under the JOBS Act, we are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act, which would require that our independent registered public accounting firm provide an attestation report on the effectiveness of our internal control over financial reporting. This may increase the risk that material weaknesses or other deficiencies in our internal control over financial reporting go undetected.

Under the JOBS Act, emerging growth companies are permitted to cover only two years of financial information in the Management’s Discussion and Analysis of Financial Condition and Results of Operations disclosures. In addition, for the presentation of “selected financial data,” which ordinarily covers five years, an emerging growth company may omit selected financial data for any period prior to the earliest audited period presented in its initial registration statement. Because we are not taking advantage of this relief under the JOBS Act, such relief has not impacted the disclosures we make in this prospectus.

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies. We have made an irrevocable election not to take advantage of this exemption from new or revised accounting standards. We will therefore be subject to the same new or revised accounting standards as other public companies that are not emerging growth companies.

Taxation as a RIC

We intend to elect to be treated as a RIC under Subchapter M of the Code. As a RIC, we generally will not have to pay corporate-level U.S. federal income taxes on any ordinary income or capital gains that we timely distribute to our stockholders as dividends. To qualify as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements, as described below. In addition, to be relieved of U.S. federal income taxes on income and gains distributed to our stockholders, we must distribute to our stockholders, for each taxable year, at least 90% of our “investment company taxable income,” which is generally our net ordinary income plus the excess of realized net short-term capital gains over realized net long-term capital losses (the “Annual Distribution Requirement”).

If we qualify as a RIC and meet the Annual Distribution Requirement, then we will not be subject to U.S. federal income tax on the portion of our investment company taxable income and net capital gains, defined as net long-term capital gains in excess of net short-term capital losses, we distribute to stockholders. We will be subject to U.S. federal income tax at regular corporate rates on any investment company taxable income or net capital gain not distributed (or deemed distributed) to our stockholders.

We will be subject to a nondeductible U.S. federal excise tax of 4% on our undistributed “ordinary income” and “capital gain net income” (each as defined below) unless for each calendar year we distribute (including through “deemed distributions” as described below) an amount equal to or greater than the sum of (a) 98% of our “ordinary income” (generally, our taxable income excluding net short-term and net long-term capital gains or losses for the calendar year), (b) 98.2% of our “capital gain net income” (including both net short-term and net long-term capital gains or losses) realized, subject to certain modifications, for the 12-month period ending October 31 of such calendar year, and (c) any income recognized, but not distributed, in the preceding years. For this purpose, however, any ordinary income or capital gain net income retained by us that is subject to corporate income tax for the tax year ending in the calendar year will be considered to have been distributed by year end.

In order to qualify as a RIC for U.S. federal income tax purposes, we must, among other things: (a) elect to be treated as a RIC, (b) meet the Annual Distribution Requirement, (c) qualify to be treated as a BDC under the 1940 Act at all times during each taxable year, (d) derive in each taxable year at least 90% of our gross income from dividends, interest, payments with respect to securities loans, gains from the sale of stock or other securities, other income derived with respect to our business of investing in such stock or securities, and net income derived from interests in “qualified publicly traded partnerships” (partnerships that are traded on an established securities market or tradable on a secondary market, other than partnerships that derive 90% of their income from interest, dividends and other permitted RIC income) (the “90% Income Test”), and (e) diversify our holdings so that at the end of each quarter of the taxable year (i) at least 50% of the value of our assets consists of cash, cash equivalents, U.S. government securities, securities of other RICs, and other securities if such other securities of any one issuer do not represent more than 5% of the value of our assets or more than 10% of the outstanding voting securities of the issuer (which for these purposes includes the equity securities of a “qualified publicly traded partnership”), and (ii) no more than 25% of the value of our assets are invested in securities, other than U.S. government securities or securities of other RICs, of one issuer or two or more issuers that are controlled (as determined under applicable tax rules) by us and that are engaged in the same or similar or related trades or businesses (the “Diversification Tests”).

Our income for tax purposes, which determines the Annual Distribution Requirement, generally differs from our income as measured by GAAP due to temporary and permanent differences in the recognition of income and expenses, returns of capital, and net unrealized appreciation or depreciation of investments.

We may be required to recognize taxable income in circumstances in which we do not receive a corresponding payment in cash. For example, if we hold debt obligations that are treated under applicable tax rules as having original issue discount (“OID”) (such as debt instruments with payment-in-kind (“PIK”) interest or, in certain cases, increasing interest rates, or debt

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instruments issued with warrants), we must include in income each year a portion of the OID that accrues over the life of the obligation, regardless of whether cash representing such income is received by us in the same taxable year. We may also have to include in our income other amounts that we have not yet received in cash, such as deferred loan origination fees that are paid after origination of the loan or are paid in non-cash compensation such as warrants or stock. We anticipate that a portion of our income may constitute OID or other income required to be included in taxable income prior to receipt of cash. In addition, we may be required to accrue for U.S. federal income tax purposes amounts attributable to our investment in CLOs that may differ from the distributions received in respect of such investments.

Because any OID or other amounts accrued will be included in our investment company taxable income for the year of the accrual, we may be required to make a distribution to our stockholders in order to satisfy the Annual Distribution Requirement, even though we will not have received any corresponding cash amount. As a result, we may have difficulty meeting the Annual Distribution Requirement. We may have to sell some of our investments at times and/or at prices we do not consider advantageous, raise additional debt or equity capital or forgo new investment opportunities for this purpose. If we are not able to obtain cash from other sources, we may not qualify as a RIC for tax purposes and thus may become subject to corporate-level U.S. federal income tax.

Gain or loss realized by us from warrants acquired by us as well as any loss attributable to the lapse of such warrants generally will be treated as capital gain or loss. Such gain or loss generally will be long-term or short term, depending on how long we held a particular warrant.

We may purchase a residual or subordinated interest in a CLO that is treated for U.S. federal income tax purposes as an equity investment in a passive foreign investment company (“PFIC”), a foreign corporation that receives at least 75% of its annual gross income from passive sources (such as interest, dividends, rents, royalties or capital gain) or holds at least 50% of its total assets in investments producing such passive income. In addition, we may purchase or acquire through other means an equity interest in a company that is considered a PFIC. If we purchase shares in a foreign corporation that is treated as a PFIC, we may be subject to U.S. federal income tax on our allocable share of a portion of any “excess distribution” received on, or any gain from the disposition of, such shares even if (in certain circumstances) our allocable share of such income is distributed as a taxable dividend to the PFIC’s stockholders. Additional charges in the nature of interest generally will be imposed on us in respect of deferred taxes arising from any such excess distribution or gain. If we elect to treat a PFIC as a qualified electing fund (“QEF”) under the Code, in lieu of the foregoing requirements, we will be required to include in income each year our proportionate share of the ordinary earnings and net capital gain of the QEF, even if such income is not distributed to us by the QEF. Alternatively, we can elect mark-to-market treatment for a PFIC; in that case, we will recognize as ordinary income our allocable share of any increase in the value of such PFIC, and as ordinary loss our allocable share of any decrease in such value to the extent that any such decrease does not exceed prior increases included in our income. Under either election, we may be required to recognize in a year income in excess of our distributions from PFICs and proceeds from dispositions of PFIC shares during that year, and such income will be taken into account for purposes of the Annual Distribution Requirement and the 4% U.S. federal excise tax.

We may purchase a residual or subordinated interest in a CLO that is treated for U.S. federal income tax purposes as an equity investment in a controlled foreign corporation (“CFC”). In addition, we may purchase or acquire through other means an equity interest in a company that is considered a CFC. If we hold more than 10% of the shares in a foreign corporation that is treated as a CFC, we may be treated as receiving a deemed distribution (taxable as ordinary income) each year from such foreign corporation in an amount equal to our pro rata share of the corporation’s income for the tax year (including both ordinary earnings and capital gains), whether or not the corporation makes an actual distribution during such year. This deemed distribution of the CFC’s income for its tax year is referred to as subpart F income. In general, a foreign corporation will be classified as a CFC if more than 50% of the shares of the corporation, measured by reference to combined voting power or value, is owned (directly, indirectly or by attribution) by U.S. stockholders. A “U.S. stockholder,” for this purpose, is any U.S. person that possesses (actually or constructively) 10% or more of the combined voting power of all classes of shares of a corporation. If we are treated as receiving a deemed distribution from a CFC, we will be required to include such distribution in our investment company taxable income regardless of whether we receive any actual distributions from such CFC, and such income will be taken into account for purposes of the Annual Distribution Requirement and the 4% U.S. federal excise tax. If we acquire a 10% or lesser interest in a CFC, we are required to treat it as a PFIC for federal income tax purposes.

Although the Code generally provides that income inclusions from a QEF and subpart F income will be “good income” for purposes of the 90% Income Test to the extent it is distributed to a RIC in the year it is included in the RIC’s income, the Code does not specifically provide whether income inclusions from a QEF and subpart F income for which no distribution is received during the RIC’s taxable year would be “good income” for the 90% Income Test. The IRS has issued a series of private rulings in which it has concluded that all income inclusions from a QEF and subpart F income included in a RIC’s income would constitute “good income” for purposes of the 90% Income Test. Such rulings are not binding on the IRS except with respect to the taxpayers to whom such rulings were issued. Accordingly, although we believe that the income inclusions from a QEF and subpart F income of a CLO that we are required to include in our taxable income would be “good income” for purposes of the 90% Income Test, no guaranty can be made that the IRS would not assert that such income would not be “good income” for purposes of the 90%

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Income Test. If such income were not considered “good income” for purposes of the 90% Income Test, we may not qualify as a RIC.

Our investments in non-U.S. securities may be subject to non-U.S. income, withholding and other taxes. In that case, our yield on those securities would be decreased. Stockholders will generally not be entitled to claim a credit or deduction with respect to non-U.S. taxes paid by us. Any gain or loss attributable to fluctuations in exchange rates between the time we accrue income, expenses, or other liabilities denominated in a foreign currency and the time we actually collect such income or pay such expenses or liabilities is generally treated as ordinary income or loss. Similarly, gain or loss on foreign currency forward contracts and the disposition of debt denominated in a foreign currency, to the extent attributable to fluctuations in exchange rates between the acquisition and disposition dates, are also generally treated as ordinary income or loss.

If we do not satisfy the Annual Distribution Requirement or otherwise do not qualify as a RIC in any taxable year, and certain relief provisions are not available, we will be subject to tax in such year on all of our taxable income, regardless of whether we make any distributions to our stockholders. In that case, all of such income will be subject to corporate-level U.S. federal income tax, reducing the amount available to be distributed to our stockholders.

As a RIC, we will not be allowed to carry forward or carry back a net operating loss for purposes of computing our investment company taxable income in other taxable years. We generally are permitted to carry forward for an indefinite period any capital losses not used to offset capital gains. However, future transactions that we engage in may limit our ability to use any capital loss carryforwards, and unrealized losses once realized, under Section 382 of the Code.

Some of the income and fees that we may recognize may not satisfy the 90% Income Test to qualify as a RIC. In order to ensure that such income and fees do not disqualify us as a RIC for a failure to satisfy such income test, we may be required to recognize such income and fees directly or indirectly through one or more entities treated as corporations for U.S. federal income tax purposes. Such corporations will be required to pay U.S. corporate income tax on their earnings, which ultimately will reduce our return on such income and fees.

Under the 1940 Act, if a BDC has any senior debt securities outstanding that were publicly issued, the BDC must make provision to prohibit the declaration of any dividend (except a dividend payable in the stock of the BDC) if its asset coverage is below 200% at the time of the distribution after deducting the amount of such dividend. If we are unable to make sufficient distributions to satisfy the Annual Distribution Requirement, we may not qualify as RIC.

Certain of our investment practices may be subject to special and complex U.S. federal income tax provisions that may, among other things, (i) disallow, suspend or otherwise limit the allowance of certain losses or deductions, (ii) convert lower taxed long-term capital gain and qualified dividend income into higher taxed short-term capital gain or ordinary income, (iii) convert an ordinary loss or a deduction into a capital loss (the deductibility of which is more limited), (iv) cause us to recognize income or gain without a corresponding receipt of cash, (v) adversely affect the time as to when a purchase or sale of stock or securities is deemed to occur, (vi) adversely alter the characterization of certain complex financial transactions, and (vii) produce income that will not be qualifying income for purposes of the 90% Income Test. We will monitor our transactions and may make certain tax elections in order to mitigate the effect of these provisions.

Failure to Qualify as a RIC

If we do not satisfy the 90% Income Test for any taxable year or the Diversification Tests at the end of any quarter of such taxable year, we may nevertheless continue to qualify as a RIC for such year if certain relief provisions of the Code apply (which, among other things, may require us to pay certain corporate-level U.S. federal taxes or to dispose of certain assets).

If we were unable to qualify for treatment as a RIC, we would be subject to tax on all of our taxable income at regular corporate rates. We would not be able to deduct distributions to stockholders, nor would they be required to be made. Distributions, including distributions of net long-term capital gain, would generally be taxable to our stockholders as dividend income to the extent of our current and accumulated earnings and profits. Such dividend income would be taxable as a qualified dividend eligible for preferential U.S. federal tax rates in the case of U.S. stockholders, as discussed below, provided that the shares have been held for more than 60 days during the 121-day period beginning 60 days before the ex-dividend date. Subject to certain limitations under the Code, corporate distributees would be eligible for the dividends received deduction. Distributions in excess of our current and accumulated earnings and profits would be treated first as a return of capital to the extent of a stockholder’s tax basis, and any remaining distributions would be treated as capital gain.

If we do not qualify as a RIC for two or more taxable years, in order to qualify as a RIC in a subsequent year we may be subject to regular corporate tax on any net built-in gains with respect to certain of our assets (i.e., the excess of the aggregate gains, including items of income, over aggregate losses that would have been realized with respect to such assets if we had been liquidated) that we elect to recognize on requalification or when recognized over the next ten years.

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PLAN OF DISTRIBUTION

We may sell the Securities through underwriters or dealers, directly to one or more purchasers, including existing stockholders in a rights offering, or through agents or through a combination of any such methods of sale. In the case of a rights offering, the applicable prospectus supplement will set forth the number of shares of our common stock issuable upon the exercise of each right and the other terms of such rights offering. Any underwriter or agent involved in the offer and sale of the Securities will also be named in the applicable prospectus supplement or pricing supplement, if any, accompanying this prospectus.

The distribution of the Securities may be effected from time to time in one or more transactions at a fixed price or prices, which may be changed, at prevailing market prices at the time of sale, at prices related to such prevailing market prices, or at negotiated prices. In the case of our common stock, the offering price per share less any underwriting commissions or discounts must generally equal or exceed the NAV per share of our common stock except (a) in connection with a rights offering to our existing stockholders, (b) with the consent of the majority of our common stockholders or (c) under such circumstances as the SEC may permit.

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LEGAL MATTERS

The legality of the Securities offered hereby will be passed upon for us by Arnold & Porter LLP, Washington, D.C. If certain legal matters in connection with an offering of Securities are passed upon by counsel for the underwriters, if any, of such offering, that counsel will be named in the related prospectus supplement or pricing supplement, if any, accompanying this prospectus.

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Ernst & Young LLP, independent registered public accounting firm, has audited our Consolidated Financial Statements at December 31, 2014 and 2013 and for the year ended December 31, 2014 and for the period October 15, 2013 (commencement of operations) to December 31, 2013, as set forth in their reports dated March 26, 2015. Ernst & Young has also audited our senior securities table as of December 31, 2014 and 2013, as set forth in the report dated July 2, 2015. We have included our financial statements and senior securities table in the prospectus and elsewhere in the registration statement in reliance on Ernst & Young LLP’s reports, given on their authority as experts in accounting and auditing. The address of Ernst & Young LLP is 8484 Westpark Drive, McLean, Virginia 22102.

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AMERICAN CAPITAL SENIOR FLOATING, LTD.

STATEMENT OF ADDITIONAL INFORMATION , 2015

This Statement of Additional Information (“SAI”) is not a prospectus, and should be read in conjunction with the prospectus dated , 2015 relating to this offering and the accompanying prospectus supplement, if any. A copy of the prospectus and the relevant accompanying prospectus supplement or pricing supplement, if any, may be obtained by calling American Capital Senior Floating, Ltd. at (301) 968-9310 and asking for Investor Relations. Terms not defined herein have the same meaning as given to them in the prospectus.

TABLE OF CONTENTS OF STATEMENT OF ADDITIONAL INFORMATION

	Page in the SAI	Location of Related Disclosure in the Prospectus
GENERAL INFORMATION AND HISTORY	SAI-2	1, 43
INVESTMENT OBJECTIVE AND POLICIES	SAI-2	43
DIRECTOR AND EXECUTIVE COMPENSATION	SAI-2	—
CONTROL PERSONS AND PRINCIPAL HOLDERS OF OUR COMMON STOCK	SAI-4	—
CERTAIN TRANSACTIONS WITH RELATED PERSONS	SAI-6	—
SAFEKEEPING, TRANSFER AND DIVIDEND PAYING AGENT AND REGISTRAR	SAI-7	—
BROKERAGE ALLOCATION AND OTHER POLICIES	SAI-7	—
TAX STATUS	SAI-8	100

The information in this Statement of Additional Information is not complete and may be changed. We may not sell these Securities until the registration statement filed with the Securities and Exchange Commission is effective. This Statement of Additional Information is not a prospectus.

SAI-1

GENERAL INFORMATION AND HISTORY

We were organized in February 2013 as a Maryland corporation, commenced operations in October 2013 and completed our IPO in January 2014. We are structured as an externally managed, non-diversified closed-end investment management company that has elected to be regulated as a BDC under the 1940 Act. For tax purposes, we intend to elect to be taxed as a RIC, as defined in Subchapter M of the Code. We are externally managed by American Capital ACSF Management, LLC, an indirect subsidiary of American Capital Asset Management, LLC, which is a wholly-owned portfolio company of American Capital, Ltd. (NASDAQ: ACAS). We are headquartered in Bethesda, Maryland, and we also maintain offices in New York.

INVESTMENT OBJECTIVE AND POLICIES

Our investment objective is to provide attractive, risk-adjusted returns over the long term primarily through current income while seeking to preserve our capital. We actively manage a leveraged portfolio composed primarily of diversified investments in first lien and second lien floating rate loans principally to large-market U.S.-based companies (collectively, “Senior Secured Floating Rate Loans” or “Loans”) which are commonly referred to as leveraged loans. S&P defines large-market loans as loans to issuers with EBITDA of greater than $50 million. We also invest in equity tranches of CLOs which are securitized vehicles collateralized primarily by Loans and we may invest in debt tranches of CLOs. In addition, we may selectively invest in loans issued by middle market companies, mezzanine and unitranche loans and high yield bonds. Additionally, we may from time to time hold or invest in other equity investments and other debt or equity securities generally arising from a restructuring of Loan positions previously held by us. We utilize leverage to enhance our returns and we are limited under the 1940 Act as a BDC on the amount of leverage we can utilize.

Our Board of Directors has approved as a principal investment strategy that, under normal market conditions, we will invest at least 80% of our assets in Senior Secured Floating Rate Loans or CLOs that are pooled investment vehicles that invest substantially all of their assets in Senior Secured Floating Rate Loans. This investment objective is a non-fundamental policy and may be changed without a stockholder vote. Stockholders will receive 60 days advance notice of any change.

As of June 30, 2015, our investment portfolio totaled $272.2 million at fair value and our NAV was $145.4 million. Our portfolio was comprised of 127 Loan obligors totaling $218.3 million and 19 CLO equity investments totaling $53.9 million. During the period ended June 30, 2015, we invested $75.1 million and investments sold or repaid totaled $83.5 million. A discussion of the Selected Condensed Consolidated Financial Data, supplementary financial information and Management’s Discussion and Analysis of Financial Condition and Results of Operations is included in the prospectus.

DIRECTOR AND EXECUTIVE COMPENSATION

Director Compensation

We were incorporated in Maryland on February 6, 2013 and commenced operations on October 15, 2013. We completed our IPO on January 22, 2014. Mr. Wilkus was appointed to the Board of Directors on February 6, 2013, and Ms. Caldwell and Messrs. Crawford, Harvey and Lundine were appointed to the Board of Directors on January 13, 2014 in connection with our IPO.

Any member of our Board of Directors who is an employee of the Company, American Capital or any of its affiliates, including our Manager, does not receive compensation from us for his or her Board service. During 2014, each such non-employee director was paid a retainer for service on the Board of Directors at an annual rate of $60,000, payable quarterly in advance. In addition, the Chair of our Audit and Compliance Committee was paid a retainer at an annual rate of $15,000, the Chair of our Compensation and Corporate Governance Committee was paid an annual retainer of $10,000, and our lead independent director was paid an annual retainer of $10,000, each payable quarterly in advance. During 2014, directors were reimbursed for travel expenses incurred in connection with such Board and committee meetings and Board-related functions.

SAI-2

The following table sets forth the compensation received by each non-employee director during 2014:

Name	Fees Earned or Paid in Cash ($)	Stock Awards ($)	Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)	All Other Compensation ($)	Total ($)
Phyllis R. Caldwell	70,000	—	—	—	—	—	70,000
Gil Crawford	70,000	—	—	—	—	—	70,000
Larry K. Harvey	75,000	—	—	—	—	—	75,000
Stan Lundine	60,000	—	—	—	—	—	60,000

Executive Compensation

We did not pay any compensation to our executive officers, nor did we make any grants of plan-based awards of any kind to them, during 2014, and we have no plans to do so for 2015. None of our executive officers received any options or stock directly from us prior to December 31, 2014, and we have no plans to do so for 2015. We do not provide any of our executive officers with pension benefits or nonqualified deferred compensation plans. We do not have any employment agreements with any persons and are not obligated to make any payments to any of our executive officers upon termination of employment or a change in control of us.

SAI-3

CONTROL PERSONS AND PRINCIPAL HOLDERS OF OUR COMMON STOCK

On October 30, 2015, there were 10,000,100 shares of our common stock outstanding. The following table sets forth, as of October 30, 2015 (unless otherwise indicated), the beneficial ownership of each current director, each nominee for director, each of our executive officers, our executive officers and directors as a group and each stockholder known to management to own beneficially more than 5% of the outstanding shares of our common stock. Unless otherwise indicated, we believe that the beneficial owners set forth in the table below have sole voting and investment power.

Name and Address of Beneficial Owner(1)	Number of Shares Beneficially Owned	Percentage of Common Stock Beneficially Owned
Beneficial owners of more than 5%:
Morgan Stanley(2) Morgan Stanley Smith Barney LLC 1585 Broadway New York, NY 10036	570,576	5.7%
Executive officers and directors:
Malon Wilkus	21,500	*
Mark Pelletier	33,000	*
John R. Erickson	10,750	*
Samuel A. Flax	2,000	*
Michael Cerullo	6,750	*
Dana Dratch	5,000	*
Phyllis R. Caldwell	3,750	*
Gil Crawford	9,000	*
Larry K. Harvey	6,723	*
Stan Lundine	—	—
All executive officers and directors as a group (10 persons)	98,473	*

* Less than one percent.

(1) The address of each of the executive officers and directors listed above is c/o American Capital Senior Floating, Ltd., 2 Bethesda Metro Center, 14^th Floor, Bethesda, MD 20814, except for Messrs. Pelletier, Cerullo and Dratch whose address is c/o American Capital Senior Floating, Ltd., 505 Fifth Avenue, 26^th Floor, New York, NY 10017.

(2) This information is based on a Schedule 13G filed with the SEC on February 17, 2015 by Morgan Stanley (“Morgan Stanley”), as a parent holding company or control person, and Morgan Stanley Smith Barney LLC (“MS Smith Barney”), as a broker or dealer. Morgan Stanley is the beneficial owner of 570,576 shares and has the shared power to dispose of or direct the disposition of 565,076 of such shares, sole power to vote or direct the vote of 543,658 of such shares, and shared power to vote or direct the vote of 5,500 of such shares. MS Smith Barney is the beneficial owner of 561,703 shares and has the shared power to dispose of or direct the disposition of 556,203 of such shares, sole power to vote or direct the vote of 534,785 of such shares, and shared power to vote or direct the vote of 5,500 of such shares.

SAI-4

The following table sets out the dollar range of our equity securities beneficially owned by each of our directors and members of our Manager’s senior investment team. We are not part of a “family of investment companies,” as that term is defined in the 1940 Act.

Name	Dollar Range of Equity Securities in American Capital Senior Floating, Ltd. (1)
Interested Directors:
Malon Wilkus	Over $100,000
Stan Lundine	None
Independent Directors:
Phyllis R. Caldwell	$10,001-$50,000
Gil Crawford	$50,001-$100,000
Larry K. Harvey	$50,001-$100,000
Portfolio Managers:
Mark Pelletier	$100,001–$500,000
Michael Cerullo	$50,001–$100,000
Dana Dratch	$50,001–$100,000
Juan Miguel Estela	$50,001–$100,000
Christian Toro	$100,001–$500,000
William Weiss	None

____________

(1)     Dollar ranges for directors are as follows: none, $1 - $10,000, $10,001 - $50,000, $50,001 - $100,000, or over $100,000. Dollar ranges for portfolio managers are as follows: none, $1–$10,000, $10,001–$50,000, $50,001–$100,000, $100,001–$500,000, $500,001–$1,000,000, or over $1,000,000.

The dollar range of our equity securities beneficially owned is calculated by multiplying the closing price of our common stock as reported on The NASDAQ Global Select Market as of October 30, 2015, times the number of shares beneficially owned, in accordance with Rule 16a-1(a)(2) of the Exchange Act.

SAI-5

CERTAIN TRANSACTIONS WITH RELATED PERSONS

Related Person Transaction Policies

We have procedures in place for the review, approval and monitoring of transactions involving us and certain persons related to us. As a BDC, the 1940 Act restricts us from participating in transactions with any persons affiliated with us, including our officers and directors, and any other person controlling or under common control with us (including American Capital), subject to certain exceptions.

Our Board of Directors has also adopted a policy regarding the approval of any “related person transaction,” which is any transaction or series of transactions in which we or any of our subsidiaries is or are to be a participant, the amount involved exceeds $120,000, and a “related person” (as defined under SEC rules) has a direct or indirect material interest. Under the policy, a related person would need to promptly disclose to our Secretary any related person transaction and all material facts about the transaction. Our Secretary would then assess and promptly communicate that information to the Compensation and Corporate Governance Committee of our Board of Directors. Based on its consideration of all of the relevant facts and circumstances, this committee will decide whether or not to approve such transaction and will generally approve only those transactions that do not create a conflict of interest. If we become aware of an existing related person transaction that has not been pre-approved under this policy, the transaction will be referred to this committee, which will evaluate all options available, including ratification, revision or termination of such transaction. Our policy requires any director who may be interested in a related person transaction to recuse himself or herself from any consideration of such related person transaction.

Our Code of Ethics, which was reviewed and approved by our Board of Directors and provided to all of our directors and officers, our Manager and the persons who provide services to us pursuant to the administrative services agreement, requires that all such persons avoid any situations or relationships that involve actual or potential conflicts of interest, or perceived conflicts of interest, between an individual’s personal interests and the interests of ACSF. Pursuant to our Code of Ethics, each of these persons must disclose any conflicts of interest, or actions or relationships that might give rise to a conflict, to their supervisor or our Secretary. If a conflict is determined to exist, the person must disengage from the conflict situation or terminate his provision of services to us. Our chief executive officer, chief financial officer, principal accounting officer, chief investment officer and certain other persons who may be designated by our Board of Directors or its Audit and Compliance Committee, whom we collectively refer to as our financial executives, must consult with our Secretary with respect to any proposed actions or arrangements that are not clearly consistent with our Code of Ethics. In the event that a financial executive wishes to engage in a proposed action or arrangement that is not consistent with our Code of Ethics, the financial executive must obtain a waiver of the relevant provisions of our Code of Ethics in advance from our Audit and Compliance Committee. We intend to post amendments to or waivers from the Code of Ethics (to the extent applicable to our financial executives) on our web site www.ACSF.com.

Related Person Transactions

We have entered into a management agreement with our Manager with a current renewal term through January 15, 2017. Unless terminated earlier, the management agreement will automatically renew following the expiration of its then current term for a one year period if approved annually by our Board of Directors or by the affirmative vote of the holders of a majority of our outstanding voting securities, and, in either case, if also approved by a majority of our directors who are not “Interested Persons,” as defined under the 1940 Act. The management agreement automatically terminates in the event of its assignment, as defined in the 1940 Act, by our Manager. The management agreement may also be terminated at any time, without the payment of any penalty, upon 60 days’ written notice, by (i) holders of a majority of our outstanding voting securities, (ii) our Board of Directors or (iii) our Manager. As of the date of this SAI, no such termination notice has been given.

We pay our Manager a base management fee payable quarterly in arrears. The management fee is calculated at an annual rate of 0.8% of our total assets, excluding cash and cash equivalents and net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. There is no incentive compensation paid to our Manager under the management agreement.

We have also agreed to reimburse our Manager and its affiliates for certain expenses related to operations incurred on our behalf, excluding employment-related expenses of our and our Manager’s officers and any employees of American Capital or its affiliates who provide services to us pursuant to the management agreement or to our Manager pursuant to the administrative services agreement described below. For the 24 months after the date of our IPO, our Manager has agreed to be responsible for certain of our operating expenses in excess of 0.75% of our consolidated net assets, less net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. Operating expenses subject to this reimbursement include both (i) our operating expenses reimbursed to our Manager and its affiliates for the expenses related to our operations incurred on our behalf, and (ii) our operating expenses directly incurred by us excluding the management fee, interest costs, taxes, and accrued costs and fees related to actual, pending, or threatened litigation, each as determined under GAAP for

SAI-6

the most recently completed fiscal quarter. As a result of this operating expense limit, any reimbursements to our Manager and its affiliates could be reduced or eliminated, and in certain instances, our Manager could be required to reimburse us so that our other expenses do not exceed the limit described above. In October 2015, our Manager agreed to extend the 0.75% cap on other operating expenses until the date of our 2016 Annual Meeting of Stockholders, at which time we expect to submit to a vote of stockholders an amendment and restatement of the management agreement which would (i) extend the expense cap through December 31, 2020, (ii) subject to the expense cap, provide for reimbursement by us to our Manager for certain compensation expenses related to legal, compliance and internal audit personnel of our Manager and its affiliates who provide services to us and (iii) make certain other immaterial changes.  Following the expiration of the expense cap, there are no limits on the reimbursement to our Manager or its affiliates of such expenses related to our operations.

We rely on our Manager to administer our business activities and day-to-day operations, subject to the supervision and oversight of our Board of Directors. Because neither we nor our Manager have any employees or separate facilities, our Manager has entered into an administrative services agreement with American Capital and the parent company of our Manager, pursuant to which our Manager has access to their employees, infrastructure, business relationships, management expertise, information technologies and capital raising capabilities, legal and compliance functions and accounting, treasury and investor relations capabilities, which allow our Manager to fulfill all of its responsibilities under the management agreement. However, we are not a party to, or a third party beneficiary under the administrative services agreement. In addition, neither the administrative services agreement nor the management agreement requires our Manager, the parent company of our Manager or American Capital to dedicate specific personnel to our operations nor requires any specific personnel of the parent company of our Manager or American Capital to dedicate a specific amount of time to our business. All of our officers are also officers of our Manager, the parent company of our Manager and/or American Capital.

Our wholly-owned consolidated special purpose financing vehicle, ACSF Funding I, LLC, has entered into an investment advisory agreement with our Manager to manage its assets. No additional compensation is payable to our Manager under such agreement.

On October 15, 2013, we entered into a $200 million revolving credit facility (the “ACAM Facility”) provided by American Capital Asset Management, LLC, the indirect parent company of our Manager and our sole stockholder prior to our IPO. Under the ACAM Facility, we were able to draw up to $180 million under Loan A and up to $20 million under Loan B at any one time. Any amounts drawn on Loan A bore interest at a fixed rate of 4.75% per annum, and any amounts drawn on Loan B bore interest at a fixed rate of 7.25% per annum. Upon the closing of our IPO in January 2014, we repaid the ACAM Facility in full in the amount of $194.7 million, plus accrued interest in the amount of $1.5 million, and terminated the ACAM Facility.

We have not entered into any other transactions in which any other director or officer or stockholder of ours or our Manager has any material interest.

SAFEKEEPING, TRANSFER AND DIVIDEND PAYING AGENT AND REGISTRAR

Our securities are held under a custodian agreement by Deutsche Bank Trust Company Americas. The principal business address of Deutsche Bank Trust Company Americas is 1761 East St. Andrew Place, Santa Ana, CA 92705-4934. Our assets are held under bank custodianship in compliance with the 1940 Act. Computershare Trust Company, N.A. is our transfer and dividend paying agent and registrar. The principal business address of Computershare Trust Company, N.A. is P.O. Box 43010, Providence, RI 02940-3010.

BROKERAGE ALLOCATION AND OTHER PRACTICES

Since we generally acquire and dispose of our investments in privately negotiated transactions, we infrequently use brokers in the normal course of business. Subject to policies established by our Board of Directors, our Manager is primarily responsible for the execution of the publicly traded securities portion of our portfolio transactions and the allocation of brokerage commissions. Our Manager does not expect to execute transactions through any particular broker or dealer, but will seek to obtain the best net results for us, taking into account such factors as price (including the applicable brokerage commission or dealer spread), size of order, difficulty of execution, and operational facilities of the firm and the firm’s risk and skill in positioning blocks of securities. While our Manager generally seeks reasonably competitive trade execution costs, we do not necessarily pay the lowest spread or commission available. Subject to applicable legal requirements, our Manager may select a broker based partly upon brokerage or research services provided to our Manager and us and any other clients. In return for such services, we may pay a higher commission than other brokers would charge if our Manager determines in good faith that such commission is reasonable in relation to the services provided.

SAI-7

TAX STATUS

The following discussion is a general summary of the material U.S. federal income tax considerations applicable to us and does not purport to be a complete description of the income tax considerations. The discussion is based upon the Code, Treasury Regulations thereunder, and administrative and judicial interpretations thereof, each as of the date hereof, all of which are subject to change. Prospective investors should consult their own tax advisors with respect to tax considerations which pertain to their purchase of Securities. This summary does not discuss any aspects of foreign, state or local tax laws. 

From our inception through the date of our IPO, we were a taxable corporation under Subchapter C of the Code (“C corporation”), subject to federal and state income taxes on our taxable ordinary income and capital gains. Prior to our IPO, we were a wholly-owned subsidiary of ACAM, which is wholly-owned by American Capital. As such, we were required to be consolidated in American Capital’s federal consolidated tax group, which has a September 30 tax year end. We had a tax sharing agreement with American Capital and other members of the consolidated tax group, under which such members bore their full share of their individual tax obligation and members were compensated for their losses and other tax benefits that were able to be used by other members of the consolidated tax group based on their pro forma stand-alone federal income tax return. We recognized $1.1 million of federal and state tax expense related to our operations prior to the IPO.

We intend to elect to be taxed as a RIC under Subchapter M of the Code beginning with the date of our IPO through our tax fiscal year end of December 31 and for subsequent years. As part of our election to be taxed as a RIC, we intend to make a “deemed sale election” whereby we will treat our net unrealized gains (“net built-in gain”) on the date of our IPO as recognized for tax purposes in our final pre-IPO C corporation federal tax return. The federal tax sharing payment that we owed to American Capital attributed to our net built-in gain was $0.6 million. American Capital waived this payment which was then treated as a deemed capital contribution to us.

Excluding the deemed sale election, there were no significant tax consequences arising from the conversion to a RIC from a C corporation in connection with our IPO.

SAI-8

AMERICAN CAPITAL SENIOR FLOATING, LTD.

INDEX TO JUNE 30, 2015 CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Assets and Liabilities as of June 30, 2015 (unaudited) and December 31, 2014	F-2
Consolidated Statements of Operations for the six months ended June 30, 2015 (unaudited) and June 30, 2014 (unaudited)	F-3
Consolidated Statements of Changes in Net Assets for the six months ended June 30, 2015 (unaudited) and June 30, 2014 (unaudited)	F-4
Consolidated Statements of Cash Flows for the six months ended June 30, 2015 (unaudited) and June 30, 2014 (unaudited)	F-5
Consolidated Schedule of Investments as of June 30, 2015 (unaudited)	F-6
Consolidated Schedule of Investments as of December 31, 2014	F-12
Notes to Consolidated Financial Statements	F-17

F-1

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

(in thousands, except share and per share data)

	June 30, 2015 (unaudited)			December 31, 2014
Assets:
Investments, fair value (cost of $277,680 and $282,133, respectively)	$	272,191		$	276,370
Cash and cash equivalents	2,458			1,757
Receivable for investments sold	3,812			2,983
Deferred financing costs	184			378
Interest receivable	560			704
Prepaid expenses and other assets	244			121
Receivable from affiliate (see note 3)	227			164
Total assets	$	279,676		$	282,477
Liabilities:
Secured revolving credit facility payable (see note 7)	$	123,800		$	130,000
Payable for investments purchased	8,400			4,226
Dividends payable (see note 10)	970			2,900
Management fee payable (see note 3)	563			577
Interest payable (see note 7)	76			80
Taxes payable (see note 8)	140			80
Payable to affiliate (see note 4)	183			212
Other liabilities and accrued expenses	180			167
Total liabilities	134,312			138,242
Commitments and contingencies (see note 11)
Net Assets:
Common stock, par value $0.01 per share; 10,000,100 and 10,000,100 issued and outstanding, respectively; 300,000,000 and 300,000,000 authorized, respectively	100			100
Paid-in capital in excess of par	151,131			151,131
Undistributed net investment income	603			133
Accumulated net realized loss from investments	(981		)	(1,366		)
Net unrealized depreciation on investments	(5,489		)	(5,763		)
Total net assets	145,364			144,235
Total liabilities and net assets	$	279,676		$	282,477
Net asset value per share outstanding	$	14.54		$	14.42

See notes to the consolidated financial statements.

F-2

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

(in thousands, except per share data)

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Investment income:
Interest	$	4,880		$	4,590		$	9,621		$	8,387
Total investment income	4,880			4,590			9,621			8,387
Expenses:
Interest and commitment fee (see note 7)	661			683			1,319			1,675
Management fee (see note 3)	563			574			1,141			1,000
Insurance	115			135			233			243
Amortization of deferred financing costs	97			98			194			194
Other general and administrative expenses	394			407			799			866
Total expenses	1,830			1,897			3,686			3,978
Reimbursement for expense cap (see note 3)	(227		)	(264		)	(472		)	(554		)
Net expenses	1,603			1,633			3,214			3,424
Net investment income before taxes	3,277			2,957			6,407			4,963
Income tax provision (see note 8)	(57		)	(30		)	(127		)	(109		)
Net investment income	3,220			2,927			6,280			4,854
Net realized and unrealized (loss) / gain on investments:
Net realized gain on investments	78			115			385			264
Net unrealized (depreciation) / appreciation on investments	(150		)	(193		)	274			51
Income tax benefit / (provision)	11			—			11			(200		)
Net realized and unrealized (loss) / gain on investments	(61		)	(78		)	670			115
Net increase in net assets resulting from operations ("Earnings")	$	3,159		$	2,849		$	6,950		$	4,969
Net investment income per share	$	0.32		$	0.29		$	0.63		$	0.49
Earnings per share (see note 5)	$	0.32		$	0.28		$	0.70		$	0.50
Dividend declared per share	$	0.29		$	0.28		$	0.58		$	0.46
Weighted average shares outstanding (1)	10,000			10,000			10,000			10,000

(1) Assumes the issuance of 10,000 shares of common stock on January 1, 2014 that were issued in connection with the IPO, which closed on January 22, 2014.

See notes to consolidated financial statements.

F-3

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

(unaudited, in thousands)

	Six Months Ended June 30,
	2015			2014
Increase in net assets resulting from operations:
Net investment income	$	6,280		$	4,854
Net realized gain	385			52
Net unrealized appreciation on investments	285			63
Net increase in net assets resulting from operations	6,950			4,969
Dividends to common stockholders:
From net investment income	(5,810		)	(4,600		)
Capital transactions:
Proceeds from public offering	—			150,000
Offering costs	—			(770		)
Contribution/(distribution) for taxes waived	(11		)	574
Net (decrease) / increase in net assets from capital transactions	(11		)	149,804
Net increase in net assets	1,129			150,173
Net assets:
Beginning of period	144,235			1,016
End of period	$	145,364		$	151,189
Undistributed net investment income included in net assets at end of period	$	603		$	500
Capital share activity:
Shares issued in public offering	—			10,000

See notes to consolidated financial statements.

F-4

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in thousands)

	Six Months Ended June 30,
	2015			2014
Cash Flows from Operating Activities:
Net increase in net assets resulting from operations	$	6,950		$	4,969
Adjustments to reconcile net increase in net assets resulting from operations:
Net realized gain on investments	(385		)	(264		)
Net unrealized appreciation on investments	(274		)	(51		)
Accretion of CLO interest income	(3,582		)	(2,578		)
Net amortization of (discount) / premium on loans	(24		)	8
Amortization of deferred financing costs	194			194
Purchase of investments	(75,084		)	(148,423		)
Proceeds from disposition of investments	83,528			63,340
(Increase) decrease in receivable for investments sold	(829		)	5,389
Increase (decrease) in payable for investments purchased	4,174			(10,606		)
Increase in receivable from affiliate	(63		)	(264		)
Decrease (increase) in interest receivable	144			(326		)
(Increase) decrease in prepaid expenses and other assets	(123		)	98
Decrease in interest payable	(4		)	(871		)
Increase in other liabilities and accrued expenses	13			57
Decrease in payable to affiliate	(29		)	(48		)
(Decrease) increase in management fee payable	(14		)	574
Increase (decrease) in taxes payable	49			(199		)
Net cash provided by (used in) operating activities	14,641			(89,001		)
Cash Flows from Financing Activities:
Proceeds from the issuance of common stock	—			150,000
Offering costs from the issuance of common stock	—			(770		)
Dividends paid	(7,740		)	(1,800		)
Proceeds from debt	55,800			149,900
Payments on debt	(62,000		)	(216,648		)
Deferred financing costs paid	—			(297		)
Net cash (used in) provided by financing activities	(13,940		)	80,385
Net increase (decrease) in cash and cash equivalents	701			(8,616		)
Cash and cash equivalents at beginning of period	1,757			12,493
Cash and cash equivalents at end of period	$	2,458		$	3,877
Supplemental disclosure of cash flow information:
Cash paid for interest and commitment fees	$	1,323		$	2,545
Cash paid for income taxes	$	67		$	517
Dividends declared and payable during the period	5,810			4,600
Supplemental disclosure of non-cash financing activity:
Contribution (distribution) for taxes waived	$	(11	)	$	574

See notes to consolidated financial statements.

F-5

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

JUNE 30, 2015

(unaudited, in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
Non-Control/Non-Affiliate Investments
First Lien Floating Rate Loans — 131.0% of Net Assets
24 Hour Fitness Worldwide, Inc. (5)	05/28/21	4.75	%	L+3.75	1.00%	Hotels, Restaurants & Leisure	$	1,982	$	1,976	$	1,888
Accellent Inc. (5)	03/12/21	4.50	%	L+3.50	1.00%	Health Care Equipment & Supplies	1,975		1,975		1,967
Acosta Holdco, Inc. (5)	09/26/21	4.25	%	L+3.25	1.00%	Media	2,487		2,447		2,483
ADMI Corp. (5), (8)	04/29/22	5.50	%	L+4.50	1.00%	Health Care Providers & Services	550		549		553
Aegis Toxicology Sciences Corporation (5)	02/24/21	5.50	%	L+4.50	1.00%	Health Care Providers & Services	1,650		1,641		1,592
Air Medical Group Holdings, Inc. (5)	04/28/22	4.50	%	L+3.50	1.00%	Health Care Providers & Services	2,000		2,005		1,989
Albertson's LLC (5)	03/21/19	5.38	%	L+4.38	1.00%	Food & Staples Retailing	997		993		1,003
Alliant Holdings I, LLC (5)	12/20/19	5.00	%	L+4.00	1.00%	Insurance	1,742		1,726		1,748
American Tire Distributors, Inc. (5)	09/01/21	5.25	%	L+4.25	1.00%	Distributors	1,486		1,479		1,502
Amneal Pharmaceuticals LLC (5)	11/01/19	4.50	%	L+3.50	1.00%	Pharmaceuticals	997		997		1,001
AmWINS Group, LLC (5)	09/06/19	5.25	%	L+4.25	1.00%	Insurance	2,949		2,963		2,980
Anchor Glass Container Corporation (5), (8), (9)	06/24/22	4.50	%	L+3.50	1.00%	Containers & Packaging	1,000		995		1,002
Aquilex LLC (5)	12/31/20	5.00	%	L+4.00	1.00%	Commercial Services & Supplies	973		971		963
ARG IH Corporation (5)	11/15/20	4.75	%	L+3.75	1.00%	Hotels, Restaurants & Leisure	2,469		2,478		2,481
Ascend Learning, LLC (5)	07/31/19	5.50	%	L+4.50	1.00%	Diversified Consumer Services	591		589		594
Ascensus, Inc. (5)	12/02/19	5.00	%	L+4.00	1.00%	Commercial Services & Supplies	938		935		941
Asurion, LLC (5)	05/24/19	5.00	%	L+3.75	1.25%	Commercial Services & Supplies	1,955		1,956		1,962
BJ's Wholesale Club, Inc. (5)	09/26/19	4.50	%	L+3.50	1.00%	Food & Staples Retailing	1,479		1,480		1,480
Blackboard Inc. (5)	10/04/18	4.75	%	L+3.75	1.00%	Software	2,448		2,448		2,442
Blue Coat Holdings, Inc. (5)	05/20/22	4.50	%	L+3.50	1.00%	Communications Equipment	2,000		2,001		1,999
BWay Intermediate Company, Inc. (5)	08/14/20	5.50	%	L+4.50	1.00%	Containers & Packaging	2,970		2,945		2,979
Calceus Acquisition, Inc. (5)	01/31/20	5.00	%	L+4.00	1.00%	Textiles, Apparel & Luxury Goods	2,349		2,358		2,265
Camp International Holding Company (5)	05/31/19	4.75	%	L+3.75	1.00%	Transportation Infrastructure	1,970		1,994		1,976
Carecore National, LLC (5)	03/05/21	5.50	%	L+4.50	1.00%	Health Care Providers & Services	2,057		2,057		2,068
CCM Merger Inc. (5)	08/06/21	4.50	%	L+3.50	1.00%	Hotels, Restaurants & Leisure	916		910		920
CDRH Parent, Inc. (5)	07/01/21	5.25	%	L+4.25	1.00%	Health Care Providers & Services	990		986		989
Checkout Holding Corp. (5)	04/09/21	4.50	%	L+3.50	1.00%	Media	2,475		2,473		2,197
CityCenter Holdings, LLC (5)	10/16/20	4.25	%	L+3.25	1.00%	Hotels, Restaurants & Leisure	1,819		1,829		1,824
Compuware Corporation (5)	12/15/21	6.25	%	L+5.25	1.00%	Software	2,987		2,915		2,925

F-6

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

JUNE 30, 2015

(unaudited, in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 131.0% of Net Assets
Concentra Inc. (5)	6/1/22	4.00	%	L+3.00	1.00%	Health Care Providers & Services	$	909	$	907	$	909
Connolly, LLC (5)	5/14/21	4.50	%	L+3.50	1.00%	Professional Services	1,116		1,107		1,121
CPG International Inc. (5)	9/30/20	4.75	%	L+3.75	1.00%	Building Products	1,948		1,948		1,937
CPI Buyer, LLC (5)	8/16/21	5.50	%	L+4.50	1.00%	Trading Companies & Distributors	992		979		993
CT Technologies Intermediate Holdings, Inc. (5), (8)	12/1/21	5.25	%	L+4.25	1.00%	Health Care Technology	500		497		503
DAE Aviation Holdings, Inc. (5)	11/2/18	6.25	%	P+3.00	1.00%	Aerospace & Defense	1,223		1,234		1,226
Dell International LLC (5), (8)	4/29/20	4.00	%	L+3.25	0.75%	Technology Hardware, Storage & Peripherals	2,500		2,509		2,504
Deltek, Inc. (5)	6/25/22	5.00	%	L+4.00	1.00%	Software	2,940		2,933		2,947
Dole Food Company, Inc. (5)	11/1/18	4.50	%	L+3.50	1.00%	Food Products	2,556		2,551		2,563
Dollar Tree, Inc. (3) , (5)	3/9/22	3.50	%	L+2.75	0.75%	Multiline Retail	418		416		418
Duff & Phelps Corporation (5)	4/23/20	4.50	%	L+3.50	1.00%	Capital Markets	3,439		3,440		3,444
DynCorp International Inc. (5)	7/7/16	6.25	%	L+4.50	1.75%	Aerospace & Defense	2,189		2,194		2,138
Electrical Components International, Inc. (5)	5/28/21	5.75	%	L+4.75	1.00%	Electrical Equipment	1,980		1,985		1,996
Emerald Expositions Holding, Inc. (5)	6/17/20	4.75	%	L+3.75	1.00%	Media	2,637		2,658		2,638
Epicor Software Corporation (5)	6/1/22	4.75	%	L+3.75	1.00%	Software	1,000		997		999
eResearchTechnology, Inc. (5)	5/8/22	5.50	%	L+4.50	1.00%	Life Sciences Tools & Services	1,000		995		998
Evergreen Acqco 1 LP (5)	7/9/19	5.00	%	L+3.75	1.25%	Multiline Retail	629		631		590
EWT Holdings III Corp. (5)	1/15/21	4.75	%	L+3.75	1.00%	Machinery	985		981		984
Expro Finservices S.à r.l. (3), (5)	9/2/21	5.75	%	L+4.75	1.00%	Energy Equipment & Services	1,985		1,958		1,762
Fairmount Minerals, Ltd. (5)	9/5/19	4.50	%	L+3.50	1.00%	Metals & Mining	2,947		2,961		2,803
Filtration Group Corporation (5)	11/20/20	4.25	%	L+3.25	1.00%	Industrial Conglomerates	1,000		1,000		1,002
Fitness International, LLC (5)	7/1/20	5.50	%	L+4.50	1.00%	Hotels, Restaurants & Leisure	1,295		1,284		1,247
Gates Global LLC (5), (8)	7/6/21	4.25	%	L+3.25	1.00%	Machinery	1,496		1,494		1,476
Generic Drug Holdings, Inc. (5)	8/16/20	5.00	%	L+4.00	1.00%	Pharmaceuticals	1,484		1,477		1,487
Global Tel*Link Corporation (5)	5/23/20	5.00	%	L+3.75	1.25%	Diversified Telecommunication Services	1,694		1,668		1,660
HGIM Corp. (5)	6/18/20	5.50	%	L+4.50	1.00%	Marine	1,474		1,478		1,196
Hyland Software, Inc. (5)	2/19/21	4.75	%	L+3.75	1.00%	Software	2,345		2,335		2,354
Hyland Software, Inc. (5), (8), (9)	6/10/22	4.75	%	L+3.75	1.00%	Software	149		148		149
Immucor, Inc. (5)	8/19/18	5.00	%	L+3.75	1.25%	Health Care Equipment & Supplies	990		997		995
Indra Holdings Corp. (5)	5/1/21	5.25	%	L+4.25	1.00%	Textiles, Apparel & Luxury Goods	1,237		1,227		1,200
Informatica Corporation (5), (8)	6/3/22	4.50	%	L+3.50	1.00%	Software	2,000		1,995		1,999
Information Resources, Inc. (5)	9/30/20	4.75	%	L+3.75	1.00%	Professional Services	1,965		1,976		1,978
Inmar, Inc. (5)	1/27/21	4.25	%	L+3.25	1.00%	Commercial Services & Supplies	1,980		1,964		1,960
Interactive Data Corporation (5)	5/2/21	4.75	%	L+3.75	1.00%	Media	1,980		1,999		1,989

F-7

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

JUNE 30, 2015

(unaudited, in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 131.0% of Net Assets
Ion Media Networks, Inc. (5)	12/18/20	4.75	%	L+3.75	1.00%	Media	$	1,975	$	1,986	$	1,983
IPC Corp. (5)	8/6/21	5.50	%	L+4.50	1.00%	Software	1,496		1,489		1,491
J.C. Penney Corporation, Inc. (3), (5)	6/20/19	5.00	%	L+4.00	1.00%	Multiline Retail	1,489		1,486		1,489
Jazz Acquisition, Inc. (5)	6/19/21	4.50	%	L+3.50	1.00%	Aerospace & Defense	1,981		1,985		1,970
Key Safety Systems, Inc. (5)	8/29/21	4.75	%	L+3.75	1.00%	Auto Components	1,489		1,482		1,497
La Frontera Generation, LLC (5)	9/30/20	4.50	%	L+3.50	1.00%	Independent Power & Renewable Electricity Producers	1,829		1,839		1,818
Landmark Aviation FBO Canada, Inc. (3), (5)	10/25/19	4.75	%	L+3.75	1.00%	Aerospace & Defense	76		76		75
Landslide Holdings, Inc. (5)	2/25/20	5.00	%	L+4.00	1.00%	Software	986		982		986
Learning Care Group (US) No. 2 Inc. (5)	5/5/21	5.00	%	L+4.00	1.00%	Diversified Consumer Services	1,021		1,021		1,026
Leonardo Acquisition Corp.  (5)	1/29/21	4.25	%	L+3.25	1.00%	Internet & Catalog Retail	2,940		2,950		2,937
Life Time Fitness, Inc. (5), (8)	6/10/22	4.25	%	L+3.25	1.00%	Hotels, Restaurants & Leisure	500		497		497
LM U.S. Member LLC (5)	10/25/19	4.75	%	L+3.75	1.00%	Aerospace & Defense	1,904		1,913		1,895
Millennium Health, LLC (5)	4/16/21	5.25	%	L+4.25	1.00%	Health Care Providers & Services	947		939		397
Mitchell International, Inc. (5)	10/13/20	4.50	%	L+3.50	1.00%	Software	2,915		2,928		2,916
Moneygram International, Inc. (3), (5)	3/27/20	4.25	%	L+3.25	1.00%	IT Services	605		571		578
National Financial Partners Corp. (5)	7/1/20	4.50	%	L+3.50	1.00%	Insurance	2,479		2,493		2,478
New Albertson's, Inc. (5)	6/27/21	4.75	%	L+3.75	1.00%	Food & Staples Retailing	997		1,002		1,001
Onex Carestream Finance LP (5)	6/7/19	5.00	%	L+4.00	1.00%	Health Care Equipment & Supplies	1,756		1,762		1,757
Opal Acquisition, Inc. (5)	11/27/20	5.00	%	L+4.00	1.00%	Health Care Providers & Services	2,946		2,927		2,905
Ortho-Clinical Diagnostics S.A. (3), (5)	6/30/21	4.75	%	L+3.75	1.00%	Health Care Providers & Services	1,980		1,978		1,945
P2 Lower Acquisition, LLC (5)	10/22/20	5.50	%	L+4.50	1.00%	Health Care Providers & Services	2,014		2,008		2,021
Par Pharmaceutical Companies, Inc. (5), (8)	9/30/19	4.00	%	L+3.00	1.00%	Pharmaceuticals	995		992		996
Peabody Energy Corporation (3), (5), (8)	9/24/20	4.25	%	L+3.25	1.00%	Oil, Gas & Consumable Fuels	995		899		839
PetSmart, Inc. (5)	3/11/22	4.25	%	L+3.25	1.00%	Specialty Retail	1,000		995		999
Pharmedium Healthcare Corporation (5)	1/28/21	4.25	%	L+3.25	1.00%	Pharmaceuticals	2,358		2,369		2,344
Phillips-Medisize Corporation (5)	6/16/21	4.75	%	L+3.75	1.00%	Health Care Equipment & Supplies	1,214		1,213		1,218
Presidio, Inc. (5)	2/2/22	5.25	%	L+4.25	1.00%	IT Services	1,347		1,347		1,352
Quikrete Holdings, Inc. (5)	9/28/20	4.00	%	L+3.00	1.00%	Constructions Materials	2,836		2,847		2,841
RCHP, Inc. (5)	4/23/19	5.25	%	L+4.25	1.00%	Health Care Providers & Services	1,980		1,965		1,975
Renaissance Learning, Inc. (5)	4/9/21	4.50	%	L+3.50	1.00%	Software	1,975		1,974		1,954
RGIS Services, LLC (5)	10/18/17	5.50	%	L+4.25	1.25%	Commercial Services & Supplies	2,947		2,935		2,753
Riverbed Technology, Inc. (5)	4/24/22	6.00	%	L+5.00	1.00%	Communications Equipment	997		993		1,009
Scientific Games International, Inc. (3), (5)	10/1/21	6.00	%	L+5.00	1.00%	Hotels, Restaurants & Leisure	993		984		993
Sears Roebuck Acceptance Corp. (3), (5)	6/30/18	5.50	%	L+4.50	1.00%	Multiline Retail	992		978		981

F-8

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

JUNE 30, 2015

(unaudited, in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 131.0% of Net Assets
Securus Technologies Holdings, Inc. (5)	4/30/20	4.75	%	L+3.50	1.25%	Diversified Telecommunication Services	$	1,895	$	1,871	$	1,849
Spin Holdco Inc. (5)	11/14/19	4.25	%	L+3.25	1.00%	Diversified Consumer Services	2,955		2,956		2,950
Standard Aero Limited (3), (5)	11/2/18	6.25	%	P+3.00	1.00%	Aerospace & Defense	553		558		554
Sterigenics-Nordion Holdings, LLC (5)	5/15/22	4.25	%	L+3.25	1.00%	Life Sciences Tools & Services	1,091		1,088		1,091
STS Operating, Inc. (5)	2/12/21	4.75	%	L+3.75	1.00%	Trading Companies & Distributors	1,975		1,986		1,975
Surgery Center Holdings, Inc. (5)	11/3/20	5.25	%	L+4.25	1.00%	Health Care Providers & Services	1,990		1,981		1,994
Syniverse Holdings, Inc. (5)	4/23/19	4.00	%	L+3.00	1.00%	Wireless Telecommunication Services	1,500		1,464		1,419
Thermasys Corp. (5)	5/3/19	5.25	%	L+4.00	1.25%	Machinery	709		710		709
TPF II LC, LLC (5)	10/2/21	5.51	%	L+4.50	1.00%	Independent Power & Renewable Electricity Producers	995		988		1,005
Trans Union LLC (5)	4/9/21	3.75	%	L+3.00	0.75%	Professional Services	997		995		991
Travelport Finance (Luxembourg) S.à r.l. (3), (5)	9/2/21	5.75	%	L+4.75	1.00%	Internet Software & Services	1,990		1,968		1,997
Turbocombustor Technology, Inc. (5)	12/2/20	5.50	%	L+4.50	1.00%	Aerospace & Defense	3,447		3,421		3,422
Tyche Holdings, LLC (5)	11/12/21	4.75	%	L+3.75	1.00%	IT Services	1,841		1,835		1,841
Univision Communications Inc. (5)	3/1/20	4.00	%	L+3.00	1.00%	Media	1,496		1,497		1,486
USI, Inc. (5)	12/27/19	4.25	%	L+3.25	1.00%	Insurance	1,965		1,980		1,967
USIC Holdings, Inc. (5)	7/10/20	4.00	%	L+3.00	1.00%	Construction & Engineering	1,463		1,468		1,459
William Morris Endeavor Entertainment, LLC (5)	5/6/21	5.25	%	L+4.25	1.00%	Media	1,975		1,973		1,975
WP CPP Holdings, LLC (5)	12/28/19	4.50	%	L+3.50	1.00%	Aerospace & Defense	2,947		2,942		2,949
Total First Lien Floating Rate Loans							$	192,921	$	192,480	$	190,427
Second Lien Floating Rate Loans — 19.2% of Net Assets
Accellent Inc. (5)	3/11/22	7.50	%	L+6.50	1.00%	Health Care Equipment & Supplies	$	1,500	$	1,497	$	1,441
Advantage Sales & Marketing Inc. (5)	7/25/22	7.50	%	L+6.50	1.00%	Professional Services	1,000		993		1,008
Ameriforge Group Inc. (6)	12/21/20	8.75	%	L+7.50	1.25%	Energy Equipment & Services	500		500		420
Applied Systems, Inc.	1/24/22	7.50	%	L+6.50	1.00%	Software	980		974		985
Asurion, LLC (5)	3/3/21	8.50	%	L+7.50	1.00%	Commercial Services & Supplies	1,000		988		1,018
Camp International Holding Company	11/29/19	8.25	%	L+7.25	1.00%	Transportation Infrastructure	1,000		1,000		1,005
Checkout Holding Corp. (5)	4/11/22	7.75	%	L+6.75	1.00%	Media	1,000		1,003		743
Connolly, LLC (5)	5/13/22	8.00	%	L+7.00	1.00%	Professional Services	1,250		1,239		1,258
Del Monte Foods, Inc. (3), (5)	8/18/21	8.25	%	L+7.25	1.00%	Food Products	1,500		1,499		1,366
Drew Marine Group Inc.	5/19/21	8.00	%	L+7.00	1.00%	Chemicals	1,000		998		990
EWT Holdings III Corp.	1/15/22	8.50	%	L+7.50	1.00%	Machinery	1,000		996		987
Filtration Group Corporation (5)	11/22/21	8.25	%	L+7.25	1.00%	Industrial Conglomerates	126		125		127
Jazz Acquisition, Inc. (5)	6/19/22	7.75	%	L+6.75	1.00%	Aerospace & Defense	1,250		1,256		1,216
Jonah Energy LLC (5)	5/12/21	7.50	%	L+6.50	1.00%	Oil, Gas & Consumable Fuels	500		494		477
Second Lien Floating Rate Loans (continued) — 19.2% of Net Assets

F-9

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

JUNE 30, 2015

(unaudited, in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
Landslide Holdings, Inc.	2/25/21	8.25	%	L+7.25	1.00%	Software	$	1,000	$	994	$	970
P2 Lower Acquisition, LLC	10/22/21	9.50	%	L+8.50	1.00%	Health Care Providers & Services	500		498		500
Performance Food Group, Inc. (5)	11/14/19	6.25	%	L+5.25	1.00%	Food & Staples Retailing	2,948		2,934		2,962
Prescrix, Inc. (3), (5)	5/2/22	8.00	%	L+7.00	1.00%	Containers & Packaging	833		826		836
Ranpak Corp. (5)	10/3/22	8.25	%	L+7.25	1.00%	Containers & Packaging	1,375		1,374		1,378
Road Infrastructure Investment, LLC (5)	9/30/21	7.75	%	L+6.75	1.00%	Chemicals	2,000		2,008		1,898
Sedgwick Claims Management Services, Inc. (5)	2/28/22	6.75	%	L+5.75	1.00%	Insurance	2,000		1,992		1,968
Solenis International, L.P. (5)	7/31/22	7.75	%	L+6.75	1.00%	Chemicals	500		498		485
TWCC Holding Corp. (5)	6/26/20	7.00	%	L+6.00	1.00%	Media	2,000		1,992		1,872
Tyche Holdings, LLC (5)	11/11/22	9.00	%	L+8.00	1.00%	IT Services	1,500		1,501		1,509
WP CPP Holdings, LLC (5)	4/30/21	8.75	%	L+7.75	1.00%	Aerospace & Defense	493		502		495
Total Second Lien Floating Rate Loans							$	28,755	$	28,681	$	27,914
CLO Equity — 37.0% of Net Assets
Apidos CLO XIV, Income Notes (3), (4), (6)	4/15/25	15.74	%				$	5,900	$	4,939	$	4,996
Apidos CLO XVIII, Income Notes (3), (4), (6)	7/22/26	14.54	%				2,500		2,045		2,021
Ares XXIX CLO Ltd., Subordinated Notes (3), (4), (6)	4/17/26	14.48	%				4,750		4,145		3,985
Avery Point II CLO, Income Notes (3), (4), (6)	7/17/25	15.62	%				3,200		2,550		2,384
Babson 2015-1, Income Notes  (3), (4), (6)	4/20/27	16.67	%				2,500		2,257		2,198
Blue Hill CLO, Ltd., Subordinated Notes (3), (4), (6)	1/15/26	13.33	%				5,400		4,513		3,863
Blue Hill CLO, Ltd., Subordinated Fee Notes (3), (4), (6)	1/15/26	6.28	%				99		84		82
Betony CLO, Ltd., Subordinated Notes (3), (4), (6)	4/15/27	16.37	%				2,500		2,227		2,202
Cent CLO 18 Limited, Subordinated Notes (3), (4), (6)	7/23/25	16.31	%				4,675		3,804		3,490
Cent CLO 19 Limited, Subordinated Notes (3), (4), (6)	10/29/25	12.90	%				2,750		2,301		2,090
Dryden 30 Senior Loan Fund, Subordinated Notes (3), (4), (6)	11/15/25	17.66	%				2,500		1,802		1,841
Dryden 31 Senior Loan Fund, Subordinated Notes (3), (4), (6)	4/18/26	11.00	%				5,250		4,353		3,913
Galaxy XVI CLO, Ltd., Subordinated Notes (3), (4), (6)	11/17/25	11.55	%				2,750		2,231		2,054
Halcyon Loan Advisors Funding 2014-1 Ltd, Subordinated Notes (3), (4), (6)	4/18/26	19.14	%				3,750		3,235		3,222
Highbridge Loan Management 2013-2, Ltd., Subordinated Notes (3), (4), (6)	10/20/24	12.81	%				1,000		792		824
Magnetite VIII, Limited, Subordinated Notes (3), (4), (6)	4/15/26	13.08	%				3,000		2,731		2,630
Neuberger Berman CLO XV, Ltd., Subordinated Notes (3), (4), (6)	10/15/25	15.43	%				3,410		2,603		2,578
Octagon Investment Partners XIV, Ltd., Income Notes (3), (4), (6)	1/15/24	15.49	%				5,500		4,257		4,043
Octagon Investment Partners XX, Ltd., Subordinated Notes (3), (4), (6)	8/12/26	13.36	%				2,500		2,244		2,177
THL Credit Wind River 2014-1 CLO Ltd., Subordinated Notes (3), (4), (6)	4/18/26	13.83	%				4,000		3,406		3,257
Total CLO Equity							$	67,934	$	56,519	$	53,850
Total Non-Control/Non-Affiliate Investments (7) — 187.2% of Net Assets							$	289,610	$	277,680	$	272,191

F-10

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

JUNE 30, 2015

(unaudited, in thousands)

Description	Maturity	Interest Rate (1)	Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount	Cost	Fair Value
Liabilities in Excess of Other Assets — (87.2%) of Net Assets								(126,827		)
Net Assets — 100.0%								$	145,364

(1) For each debt investment we have provided the weighted-average interest rate in effect as of June 30, 2015. For each CLO investment we have provided the accounting yield as of June 30, 2015 determined using the effective interest method that will be applied to the current amortized cost of the investment as adjusted for credit impairments, if any, in the following quarter.

(2) Floating rate debt investments typically accrue interest at a predetermined spread relative to an index, typically the London Interbank Offered Rate (“LIBOR” or “L”) or the prime index rate ("PRIME" or “P”), and reset monthly, quarterly or semi-annually. These instruments may be subject to a LIBOR or PRIME rate floor.

(3) Investments that are not "qualifying assets" under Section 55(a) of the 1940 Act. Under the 1940 Act, we may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of our total assets. As of June 30, 2015, qualifying assets represented 76% of total assets.

(4) These securities are exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions that are exempt from registration, normally to qualified institutional buyers.

(5) Assets are held at ACSF Funding and are pledged as collateral for the Credit Facility.

(6) Fair value was determined using significant unobservable inputs and are classified as Level 3 in the fair value hierarchy.

(7) Net estimated unrealized loss for federal income tax purposes is $(9,024) as of June 30, 2015 based on a tax cost of $281,215. Estimated aggregate gross unrealized loss for federal income tax purposes as of June 30, 2015 is $(9,592); estimated aggregate gross unrealized gain for federal income tax purposes as of June 30, 2015 is $568.

(8) All or a portion of this position had not settled as of June 30, 2015.

(9) Denotes a "when issued" security that was scheduled to close after June 30, 2015.

F-11

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
Non-Control/Non-Affiliate Investments
First Lien Floating Rate Loans — 135.2% of Net Assets
24 Hour Fitness Worldwide, Inc. (6)	05/28/21	4.75	%	L+3.75	1.00%	Hotels, Restaurants & Leisure	$	2,178	$	2,171	$	2,095
Accellent Inc. (6)	03/12/21	4.50	%	L+3.50	1.00%	Health Care Equipment & Supplies	1,985		1,985		1,947
Acosta Holdco, Inc. (6)	09/24/21	5.00	%	L+4.00	1.00%	Media	2,500		2,482		2,504
Aegis Toxicology Sciences Corporation (6)	02/24/21	5.50	%	L+4.50	1.00%	Health Care Providers & Services	1,658		1,648		1,662
Albertson's LLC (6)	08/25/21	4.50	%	L+4.50	1.00%	Food & Staples Retailing	1,000		986		1,002
American Tire Distributors, Inc. (6)	06/01/18	5.75	%	L+4.75	1.00%	Distributors	1,489		1,489		1,493
AmWINS Group, LLC (6)	09/06/19	5.25	%	L+4.25	1.00%	Insurance	2,964		2,980		2,948
Aquilex LLC (6)	12/31/20	5.00	%	L+4.00	1.00%	Commercial Services & Supplies	1,980		1,976		1,943
ARG IH Corporation (6)	11/16/20	4.75	%	L+3.75	1.00%	Hotels, Restaurants & Leisure	2,475		2,485		2,472
Aristocrat Leisure Limited (3), (6)	10/20/21	4.75	%	L+3.75	1.00%	Hotels, Restaurants & Leisure	1,500		1,485		1,478
Ascend Learning, LLC (6)	07/31/19	6.00	%	L+5.00	1.00%	Diversified Consumer Services	596		593		593
Ascensus, Inc. (6)	12/02/19	5.00	%	L+4.00	1.00%	Commercial Services & Supplies	990		986		986
Aspen Dental Management, Inc. (6)	10/06/16	7.00	%	L+5.50	1.50%	Health Care Providers & Services	987		981		990
Asurion, LLC (6)	05/24/19	5.00	%	L+3.75	1.25%	Commercial Services & Supplies	1,970		1,972		1,948
Atlantic Power Limited Partnership (3), (6)	02/24/21	4.75	%	L+3.75	1.00%	Independent Power & Renewable Electricity Producers	821		818		810
BJ's Wholesale Club, Inc. (6)	09/26/19	4.50	%	L+3.50	1.00%	Food & Staples Retailing	1,485		1,486		1,461
Blackboard Inc. (6)	10/04/18	4.75	%	L+3.75	1.00%	Software	2,460		2,461		2,442
BWay Intermediate Company, Inc. (6)	08/14/20	5.55	%	L+4.50	1.00%	Containers & Packaging	2,985		2,957		2,981
Calceus Acquisition, Inc. (6)	01/31/20	5.00	%	L+4.00	1.00%	Textiles, Apparel & Luxury Goods	2,963		2,975		2,875
Camp International Holding Company (6)	05/31/19	4.75	%	L+3.75	1.00%	Transportation Infrastructure	1,980		2,007		1,985
Caraustar Industries, Inc. (6)	05/01/19	7.50	%	L+6.25	1.25%	Containers & Packaging	742		736		738
Carecore National, LLC (6)	03/05/21	5.50	%	L+4.50	1.00%	Health Care Providers & Services	2,068		2,067		2,050
CCM Merger Inc. (6)	08/06/21	4.50	%	L+3.50	1.00%	Hotels, Restaurants & Leisure	977		970		967
CDRH Parent, Inc. (6)	07/01/21	5.25	%	L+4.25	1.00%	Health Care Providers & Services	1,496		1,500		1,478
Checkout Holding Corp. (6)	04/09/21	4.50	%	L+3.50	1.00%	Media	2,488		2,486		2,379
Citadel Plastics Holdings, Inc. (6), (7)	11/05/20	5.25	%	L+4.25	1.00%	Chemicals	750		743		744
CityCenter Holdings, LLC (6)	10/16/20	4.25	%	L+3.25	1.00%	Hotels, Restaurants & Leisure	1,819		1,830		1,807
Connolly, LLC (6)	05/14/21	5.00	%	L+4.00	1.00%	Professional Services	1,493		1,479		1,482
CPG International Inc. (6)	09/30/20	4.75	%	L+3.75	1.00%	Building Products	2,958		2,959		2,921
CPI Buyer, LLC (6)	08/16/21	5.50	%	L+4.50	1.00%	Trading Companies & Distributors	998		983		983
DAE Aviation Holdings, Inc. (6)	11/02/18	5.00	%	L+4.00	1.00%	Aerospace & Defense	1,362		1,376		1,362

F-12

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 135.2% of Net Assets
Deltek, Inc. (6)	10/10/18	4.50	%	L+3.50	1.00%	Software	$	2,962	$	2,971	$	2,934
Dole Food Company, Inc. (6)	11/01/18	4.50	%	L+3.50	1.00%	Food Products	3,637		3,630		3,603
DPX Holdings B.V.  (3), (6)	03/11/21	4.25	%	L+3.25	1.00%	Life Sciences Tools & Services	1,990		1,986		1,937
DTZ U.S. Borrower, LLC (3), (5), (6)	11/04/21	5.50	%	L+4.50	1.00%	Real Estate Management & Development	1,250		1,231		1,250
Duff & Phelps Corporation (6)	04/23/20	4.50	%	L+3.50	1.00%	Capital Markets	3,456		3,458		3,424
DynCorp International Inc. (6)	07/07/16	6.25	%	L+4.50	1.75%	Aerospace & Defense	2,189		2,196		2,186
Electrical Components International, Inc. (6)	05/28/21	5.75	%	L+4.75	1.00%	Electrical Equipment	1,990		1,995		1,994
Emerald Expositions Holding, Inc. (6)	06/17/20	4.75	%	L+3.75	1.00%	Media	2,748		2,771		2,702
Evergreen Acqco 1 LP (6)	07/09/19	5.00	%	L+3.75	1.25%	Multiline Retail	1,995		2,002		1,935
EWT Holdings III Corp. (6)	01/15/21	4.75	%	L+3.75	1.00%	Machinery	990		986		974
Exgen Renewables I, LLC (6)	02/06/21	5.25	%	L+4.25	1.00%	Independent Power & Renewable Electricity Producers	1,408		1,413		1,415
Expro Finservices S.à r.l.  (3), (6)	09/02/21	5.75	%	L+4.75	1.00%	Energy Equipment & Services	1,995		1,966		1,646
Fairmount Minerals, Ltd. (6)	09/05/19	4.50	%	L+3.50	1.00%	Metals & Mining	2,963		2,978		2,701
Fitness International, LLC (6)	07/01/20	5.50	%	L+4.50	1.00%	Hotels, Restaurants & Leisure	1,301		1,289		1,249
Global Tel*Link Corporation (6)	05/22/20	5.00	%	L+3.75	1.25%	Diversified Telecommunication Services	1,704		1,675		1,691
Great Wolf Resorts, Inc. (6)	08/06/20	5.75	%	L+4.75	1.00%	Hotels, Restaurants & Leisure	2,962		2,969		2,946
Greeneden U.S. Holdings II, LLC (6)	11/13/20	4.50	%	L+3.50	1.00%	Software	1,980		1,971		1,965
HGIM Corp. (6)	06/18/20	5.50	%	L+4.50	1.00%	Marine	1,481		1,486		1,204
Hyland Software, Inc. (6)	02/19/21	4.75	%	L+3.75	1.00%	Software	1,355		1,349		1,346
Ikaria, Inc. (6)	02/12/21	5.00	%	L+4.00	1.00%	Health Care Providers & Services	2,504		2,509		2,498
Immucor, Inc. (6)	08/17/18	5.00	%	L+3.75	1.25%	Health Care Equipment & Supplies	995		1,003		985
Indra Holdings Corp. (6)	04/30/21	5.25	%	L+4.25	1.00%	Textiles, Apparel & Luxury Goods	1,244		1,232		1,231
Information Resources, Inc. (6)	09/30/20	4.75	%	L+3.75	1.00%	Professional Services	1,975		1,988		1,970
Inmar, Inc. (6)	01/27/21	4.25	%	L+3.25	1.00%	Commercial Services & Supplies	1,990		1,973		1,938
Interactive Data Corporation (6)	04/30/21	4.75	%	L+3.75	1.00%	Media	1,990		2,011		1,981
Ion Media Networks, Inc. (6)	12/18/20	4.75	%	L+3.75	1.00%	Media	1,985		1,997		1,965
J.C. Penney Corporation, Inc. (3), (6)	06/20/19	5.00	%	L+4.00	1.00%	Multiline Retail	1,496		1,493		1,442
Jazz Acquisition, Inc. (6)	06/18/21	4.50	%	L+3.50	1.00%	Aerospace & Defense	1,990		1,995		1,975
Key Safety Systems, Inc. (6)	08/27/21	4.75	%	L+3.75	1.00%	Auto Components	1,496		1,489		1,489
La Frontera Generation, LLC (6)	09/30/20	4.50	%	L+3.50	1.00%	Independent Power & Renewable Electricity Producers	1,839		1,850		1,817
Landmark Aviation FBO Canada, Inc.(3), (5), (6)	10/25/19	4.75	%	L+3.75	1.00%	Aerospace & Defense	76		76		75
Landslide Holdings, Inc. (6)	02/25/20	5.00	%	L+4.00	1.00%	Software	993		988		978
Learning Care Group (US) No. 2 Inc. (6)	05/05/21	5.50	%	L+4.50	1.00%	Diversified Consumer Services	1,026		1,022		1,018
Leonardo Acquisition Corp. (6)	01/29/21	4.25	%	L+3.25	1.00%	Internet & Catalog Retail	2,978		2,989		2,901
LM U.S. Member LLC (5), (6)	10/25/19	4.75	%	L+3.75	1.00%	Aerospace & Defense	1,914		1,923		1,900

F-13

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 135.2% of net assets
Millennium Health, LLC (6)	04/16/21	5.25	%	L+4.25	1.00%	Health Care Providers & Services	$	1,197	$	1,186	$	1,194
Mitchell International, Inc. (6)	10/13/20	4.50	%	L+3.50	1.00%	Software	2,977		2,992		2,943
Murray Energy Corporation (6)	12/05/19	5.25	%	L+4.25	1.00%	Oil, Gas & Consumable Fuels	2,977		2,965		2,875
National Financial Partners Corp. (6)	07/01/20	4.50	%	L+3.50	1.00%	Insurance	2,491		2,508		2,473
Onex Carestream Finance LP (6)	06/07/19	5.00	%	L+4.00	1.00%	Health Care Equipment & Supplies	1,858		1,865		1,854
Opal Acquisition, Inc. (6)	11/27/20	5.00	%	L+4.00	1.00%	Health Care Providers & Services	2,970		2,949		2,948
Ortho-Clinical Diagnostics S.A. (3), (6)	06/30/21	4.75	%	L+3.75	1.00%	Health Care Providers & Services	1,990		1,987		1,962
OSG Bulk Ships, Inc. (3), (6)	08/05/19	5.25	%	L+4.25	1.00%	Oil, Gas & Consumable Fuels	1,492		1,479		1,459
OSG International, Inc. (3), (6)	08/05/19	5.75	%	L+4.75	1.00%	Oil, Gas & Consumable Fuels	1,492		1,479		1,455
P2 Lower Acquisition, LLC (6)	10/22/20	5.50	%	L+4.50	1.00%	Health Care Providers & Services	2,112		2,106		2,091
Pharmedium Healthcare Corporation (6)	01/28/21	4.25	%	L+3.25	1.00%	Pharmaceuticals	2,370		2,383		2,307
Phillips-Medisize Corporation (6)	06/16/21	4.75	%	L+3.75	1.00%	Health Care Equipment & Supplies	1,221		1,219		1,205
PRA Holdings, Inc. (6)	09/23/20	4.50	%	L+3.50	1.00%	Life Sciences Tools & Services	1,638		1,638		1,620
Quikrete Holdings, Inc. (6)	09/28/20	4.00	%	L+3.00	1.00%	Construction Materials	2,836		2,848		2,803
RCHP, Inc. (6)	04/23/19	6.00	%	L+5.00	1.00%	Health Care Providers & Services	1,990		1,973		1,980
Renaissance Learning, Inc. (6)	04/09/21	4.50	%	L+3.50	1.00%	Software	1,985		1,983		1,947
RGIS Services, LLC (6), (7)	10/18/17	5.50	%	L+4.25	1.25%	Commercial Services & Supplies	2,962		2,948		2,718
Scientific Games International, Inc. (3), (6)	10/01/21	6.00	%	L+5.00	1.00%	Hotels, Restaurants & Leisure	2,000		1,981		1,976
Sears Roebuck Acceptance Corp. (3), (6)	06/29/18	5.50	%	L+4.50	1.00%	Multiline Retail	997		981		962
Securus Technologies Holdings, Inc. (6)	04/30/20	4.75	%	L+3.50	1.25%	Diversified Telecommunication Services	1,904		1,878		1,885
Spin Holdco Inc. (6)	11/14/19	4.25	%	L+3.25	1.00%	Diversified Consumer Services	2,970		2,971		2,929
Standard Aero Limited (3), (6)	11/02/18	5.00	%	L+4.00	1.00%	Aerospace & Defense	618		624		618
STHI Holding Corp.  (6)	08/06/21	4.50	%	L+3.50	1.00%	Life Sciences Tools & Services	1,995		1,986		1,984
STS Operating, Inc. (6)	02/12/21	4.75	%	L+3.75	1.00%	Trading Companies & Distributors	1,985		1,997		1,955
Surgery Center Holdings, Inc. (6)	11/03/20	5.25	%	L+4.25	1.00%	Health Care Providers & Services	2,000		1,990		1,953
Thermasys Corp. (6)	05/03/19	5.25	%	L+4.00	1.25%	Machinery	1,839		1,843		1,811
TMS International Corp. (6)	10/16/20	4.50	%	L+3.50	1.00%	Metals & Mining	2,970		2,976		2,977
TPF II LC, LLC (6)	09/29/21	5.50	%	L+4.50	1.00%	Independent Power & Renewable Electricity Producers	1,000		993		1,002
Travelport Finance (Luxembourg) S.à r.l. (3), (6)	09/02/21	6.00	%	L+5.00	1.00%	Internet Software & Services	2,000		1,976		2,000
Turbocombustor Technology, Inc. (6)	12/02/20	5.50	%	L+4.50	1.00%	Aerospace & Defense	3,465		3,435		3,433
Tyche Holdings, LLC (6)	11/12/21	5.50	%	L+4.50	1.00%	IT Services	1,850		1,844		1,843
USI, Inc. (6)	12/27/19	4.25	%	L+3.25	1.00%	Insurance	1,975		1,992		1,947

F-14

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 135.2% of net assets
USIC Holdings, Inc. (6)	07/10/20	4.00	%	L+3.00	1.00%	Construction & Engineering	$	1,470	$	1,476	$	1,433
Veyance Technologies, Inc. (6)	09/08/17	5.25	%	L+4.00	1.25%	Machinery	1,496		1,496		1,494
Vitera Healthcare Solutions, LLC (6), (7)	11/04/20	6.00	%	L+5.00	1.00%	Health Care Technology	2,228		2,212		2,216
WideOpenWest Finance, LLC (6)	04/01/19	4.75	%	L+3.75	1.00%	Media	2,975		3,001		2,962
WP CPP Holdings, LLC (6)	12/27/19	4.75	%	L+3.75	1.00%	Aerospace & Defense	2,962		2,956		2,947
Total First Lien Floating Rate Loans							$	198,221	$	198,028	$	194,952
Second Lien Floating Rate Loans — 20.7% of Net Assets
Accellent Inc. (6)	03/11/22	7.50	%	L+6.50	1.00%	Health Care Equipment & Supplies	$	1,500	$	1,497	$	1,421
Advantage Sales & Marketing Inc. (6)	07/25/22	7.50	%	L+6.50	1.00%	Professional Services	1,000		993		992
Ameriforge Group Inc.	12/21/20	8.75	%	L+7.50	1.25%	Energy Equipment & Services	500		500		493
Applied Systems, Inc.	01/24/22	7.50	%	L+6.50	1.00%	Software	1,000		993		981
Asurion, LLC (6)	03/03/21	8.50	%	L+7.50	1.00%	Commercial Services & Supplies	1,000		987		997
Camp International Holding Company	11/29/19	8.25	%	L+7.25	1.00%	Transportation Infrastructure	1,000		1,000		1,005
Checkout Holding Corp. (6)	04/11/22	7.75	%	L+6.75	1.00%	Media	1,000		1,003		933
Connolly, LLC (6)	05/13/22	8.00	%	L+7.00	1.00%	Professional Services	1,250		1,238		1,241
Del Monte Foods, Inc. (3), (6)	08/18/21	8.25	%	L+7.25	1.00%	Food Products	1,500		1,499		1,290
Drew Marine Group Inc. (7)	05/19/21	8.00	%	L+7.00	1.00%	Chemicals	1,000		998		995
EWT Holdings III Corp.	01/15/22	8.50	%	L+7.50	1.00%	Machinery	1,000		995		975
Filtration Group Corporation (6)	11/22/21	8.25	%	L+7.25	1.00%	Industrial Conglomerates	500		496		501
Ikaria, Inc. (6)	02/14/22	8.75	%	L+7.75	1.00%	Health Care Providers & Services	1,000		1,012		987
Inmar, Inc. (6)	01/27/22	8.00	%	L+7.00	1.00%	Commercial Services & Supplies	750		743		734
Jazz Acquisition, Inc. (6)	06/19/22	7.75	%	L+6.75	1.00%	Aerospace & Defense	1,250		1,256		1,223
Jonah Energy LLC (6), (7)	05/12/21	7.50	%	L+6.50	1.00%	Oil, Gas & Consumable Fuels	500		493		432
Landslide Holdings, Inc.	02/25/21	8.25	%	L+7.25	1.00%	Software	1,000		993		975
P2 Lower Acquisition, LLC	10/22/21	9.50	%	L+8.50	1.00%	Health Care Providers & Services	500		498		485
Performance Food Group, Inc. (6)	11/14/19	6.25	%	L+5.25	1.00%	Food & Staples Retailing	2,963		2,947		2,914
Prescrix, Inc. (3), (6)	05/02/22	8.00	%	L+7.00	1.00%	Containers & Packaging	1,333		1,321		1,325
Ranpak Corp. (6)	10/03/22	8.25	%	L+7.25	1.00%	Containers & Packaging	1,375		1,374		1,374
Road Infrastructure Investment, LLC (6), (7)	09/30/21	7.75	%	L+6.75	1.00%	Chemicals	2,000		2,009		1,813
Sedgwick Claims Management Services, Inc. (6)	02/28/22	6.75	%	L+5.75	1.00%	Insurance	2,000		1,991		1,895
Solenis International, L.P. (6)	07/31/22	7.75	%	L+6.75	1.00%	Chemicals	500		498		487
TWCC Holding Corp. (6)	06/26/20	7.00	%	L+6.00	1.00%	Media	2,000		1,991		1,923
Tyche Holdings, LLC (6)	11/11/22	9.00	%	L+8.00	1.00%	IT Services	500		495		495
WP CPP Holdings, LLC (6)	04/30/21	8.75	%	L+7.75	1.00%	Aerospace & Defense	1,000		1,022		955
Total Second Lien Floating Rate Loans							$	30,921	$	30,842	$	29,841

F-15

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	LIBOR Interest Rate Floor	Industry	Par Amount		Cost		Fair Value
CLO Equity — 35.7% of Net Assets
Apidos CLO XIV, Income Notes (3), (4), (7)	04/15/25	14.54	%				$	5,900	$	5,299	$	5,337
Ares XXIX CLO Ltd., Subordinated Notes (3), (4), (7)	04/17/26	13.95	%				4,750		4,339		4,239
Avery Point II CLO, Limited, Income Notes (3), (4), (7)	07/17/25	14.34	%				3,200		2,764		2,697
Blue Hill CLO, Ltd., Subordinated Notes (3), (4), (7)	01/15/26	14.39	%				5,400		4,709		4,588
Blue Hill CLO, Ltd., Subordinated Fee Notes (3), (4), (7)	01/15/26	6.38	%				100		94		91
Carlyle Global Market Strategies CLO 2013-3, Ltd., Subordinated Notes (3), (4), (7)	07/15/25	18.93	%				2,750		2,096		2,311
Cent CLO 18 Limited, Subordinated Notes (3), (4), (7)	07/23/25	14.13	%				4,675		4,007		3,940
Cent CLO 19 Limited, Subordinated Notes (3), (4), (7)	10/29/25	12.27	%				2,750		2,402		2,299
Dryden 31 Senior Loan Fund, Subordinated Notes (3), (4), (7)	04/18/26	9.53	%				5,250		4,686		4,187
Galaxy XVI CLO, Ltd., Subordinated Notes (3), (4), (7)	11/17/25	11.21	%				2,750		2,362		2,259
Halcyon Loan Advisors Funding 2014-1 Ltd., Subordinated Notes (3), (4), (7)	04/18/26	18.01	%				3,750		3,315		3,376
Highbridge Loan Management 2013-2, Ltd., Subordinated Notes (3), (4), (7)	10/20/24	14.71	%				1,000		849		838
Magnetite VIII, Limited, Subordinated Notes (3), (4), (7)	04/15/26	11.38	%				3,000		2,911		2,680
Neuberger Berman CLO XV, Ltd., Subordinated Notes (3), (4), (7)	10/15/25	13.92	%				3,410		2,786		2,773
Octagon Investment Partners XIV, Ltd., Income Notes (3), (4), (7)	01/15/24	14.33	%				5,500		4,571		4,210
Octagon Investment Partners XX, Ltd., Subordinated Notes (3), (4), (7)	08/12/26	11.53	%				2,500		2,482		2,327
THL Credit Wind River 2014-1 CLO Ltd., Subordinated Notes (3), (4), (7)	04/18/26	12.77	%				4,000		3,591		3,425
Total CLO Equity							$	60,685	$	53,263	$	51,577
Total Non-Control/Non-Affiliate Investments (8) — 191.6% of Net Assets							$	289,827	$	282,133	$	276,370
Liabilities in Excess of Other Assets — (91.6%) of Net Assets											(132,135		)
Net Assets — 100.0%											$	144,235

(1) For each debt investment we have provided the weighted-average interest rate in effect as of December 31, 2014. For each CLO investment we have provided the accounting yield as of December 31, 2014 determined using the effective interest method that will be applied to the current amortized cost of the investment as adjusted for credit impairments, if any, in the following quarter.

(2) Floating rate debt investments typically accrue interest at a predetermined spread relative to an index, typically LIBOR or PRIME, and reset monthly, quarterly or semi-annually. These instruments may be subject to a LIBOR or PRIME rate floor.

(3) Investments that are not "qualifying assets" under Section 55(a) of the 1940 Act. Under the 1940 Act, we may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of our total assets. As of December 31, 2014, qualifying assets represented 74% of total assets.

(4) These securities are exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions that are exempt from registration, normally to qualified institutional buyers.

(5) All or a portion of this position had not settled as of December 31, 2014.

(6) Assets are held at ACSF Funding and are pledged as collateral for the Credit Facility.

(7) Fair value was determined using significant unobservable inputs and are classified as Level 3 in the fair value hierarchy.

Net unrealized loss for federal income tax purposes is $(8,273) as of December 31, 2014 based on a tax cost of $284,643. Aggregate gross unrealized gains for federal tax purposes as of December 31, 2014 was $182, and gross unrealized losses for federal income tax purposes as of December 31, 2014 was $(8,455).

F-16

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

JUNE 30, 2015

(in thousands, except share and per share amounts)

Note 1. Organization

American Capital Senior Floating, Ltd. (which is referred to as “ACSF”, “we”, "us" and “our”) was organized in February 2013 as a Maryland corporation and commenced operations on October 15, 2013. We are structured as an externally managed, non-diversified closed-end investment management company that has elected to be regulated as a business development company ("BDC") under the Investment Company Act of 1940, as amended (the "1940 Act"). In November 2013, we formed a wholly-owned special purpose financing vehicle, ACSF Funding I, LLC, a Delaware limited liability company (“ACSF Funding”).

In January 2014, we completed an initial public offering (“IPO”) of 10,000,000 shares of common stock at the public offering price of $15.00 per share for gross proceeds of $150,000. Upon completion of the IPO, we became externally managed by American Capital ACSF Management, LLC (our "Manager"), an indirect subsidiary of American Capital Asset Management, LLC ("ACAM"), which is a wholly-owned portfolio company of American Capital, Ltd. ("American Capital"). Prior to the completion of our IPO, we were wholly-owned by ACAM. Following completion of the IPO, ACAM owned approximately 3% of our outstanding common stock, the maximum amount permissible under the 1940 Act. In conjunction with the IPO, our Manager paid the underwriting commissions of $7,952. Our common stock is listed on the NASDAQ Global Select Market, where it trades under the symbol “ACSF”. In connection with the IPO, we elected to be treated as a BDC under the 1940 Act and intend to elect to be taxed as a regulated investment company (“RIC”), as defined in Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”).

Investment Objective

Our investment objective is to provide attractive, risk-adjusted returns over the long term primarily through current income while seeking to preserve our capital. We actively manage a leveraged portfolio composed primarily of diversified investments in first lien and second lien floating rate loans principally to large-market U.S.-based companies (collectively, “Senior Floating Rate Loans” or “SFRLs”) which are commonly referred to as leveraged loans. We also invest in equity tranches of collateralized loan obligations (“CLOs”) which are securitized vehicles collateralized primarily by SFRLs and we may invest in debt tranches of CLOs. In addition, we may selectively invest in loans issued by middle market companies, mezzanine and unitranche loans and high yield bonds. Additionally, we may from time to time hold or invest in other equity investments and other debt or equity securities generally arising from a restructuring of Senior Floating Rate Loan positions previously held by us.

Note 2. Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Article 10 of Regulation S-X. Accordingly, certain disclosures accompanying annual financial statements prepared in accordance with GAAP are omitted. In the opinion of management, all adjustments which are of a normal recurring nature and considered necessary for the fair presentation of the financial statements for the interim period have been included. The current period's results of operations are not necessarily indicative of results that ultimately may be achieved for the year. The unaudited interim consolidated financial statements and notes thereto should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2014.

The consolidated financial statements include our accounts and those of our wholly-owned subsidiary, ACSF Funding. Intercompany accounts and transactions have been eliminated in consolidation. The accounts of ACSF Funding are prepared for the same reporting period as ours using consistent accounting policies. Subsequent events are evaluated and disclosed as appropriate for events occurring through the date the consolidated financial statements are issued.

Use of Estimates

The preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amount of income and expenses during the reported period. Changes in the economic environment, financial markets, and any other parameters used in determining such estimates could cause actual results to differ.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

Investment Classification

As required by the 1940 Act, investments are classified by level of control. "Control Investments" are defined as investments in portfolio companies that we are deemed to control, as defined in the 1940 Act. "Affiliate Investments" are investments in those companies that are affiliated companies, as defined in the 1940 Act, other than Control Investments. "Non-Control/Non-Affiliate Investments" are those that are neither Control Investments nor Affiliate Investments.

Generally, under the 1940 Act, we are deemed to control a company in which we have invested if we own more than 25% of the voting securities of such company. We are deemed to be an affiliate of a company if we own 5% or more of the voting securities of such company.

As of June 30, 2015 and December 31, 2014, all of our investments were Non-Control/Non-Affiliate investments.

Fair Value Measurements

We value our investments in accordance with the 1940 Act and Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("ASC 820"), as determined in good faith by our Board of Directors. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Due to the uncertainty inherent in the valuation process, estimates of fair value may differ significantly from the values that would have been used had a ready market for our investments existed, and the differences could be material. Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on the investments to be different than the valuations currently assigned.

We undertake a multi-step valuation process to determine the fair value of our investments in accordance with ASC 820. The valuation process begins with the development of a preliminary valuation recommendation for each investment as determined in accordance with our valuation policy by a group of our Manager’s valuation, accounting and finance professionals, which is independent of our Manager’s investment team. To prepare the proposed valuation, the group reviews information provided by a nationally recognized independent pricing service, broker-dealers, and may consult with the investment team and other internal resources of our Manager and its affiliates. The preliminary valuation recommendations are then presented to the Investment Committee and reviewed and approved by our Audit and Compliance Committee. The valuation recommendations are then reviewed by our Board of Directors for final approval.

Securities Transactions

Securities transactions are recorded on the trade date. The trade date for loans purchased in the "primary market" is considered the date on which the loan allocations are determined. The trade date for loans and other investments purchased in the "secondary market" is the date on which the transaction is entered into. The trade date for primary CLO equity transactions and any other security transaction entered outside conventional channels is the date we have determined all material terms have been defined for the transaction and have obtained a right to demand the securities purchased or collect the proceeds of a sale and incur an obligation to pay the price of the securities purchased or to deliver the securities sold, respectively. Cost is determined based on consideration given, adjusted for amortization of original issuance discounts ("OID"), market discounts and premiums.

Realized Gain or Loss and Unrealized Appreciation or Depreciation

Realized gain or loss from an investment is recorded at the time of disposition and calculated using the weighted average cost method. Unrealized appreciation or depreciation reflects the changes in fair value of investments as determined in compliance with the valuation policy as discussed in Note 6 in this Quarterly Report on Form 10-Q.

Income Taxes

As a RIC under Subchapter M of the Code, we will not be subject to U.S. federal income tax on the portion of our taxable income distributed to our stockholders as a dividend. We intend to distribute between 90% and 100% of our taxable income, within the Subchapter M rules, and therefore do not anticipate incurring corporate-level U.S. federal or state income tax. As a RIC, we are also subject to a nondeductible federal excise tax if we do not distribute at least 98% of net ordinary income, 98.2% of any capital gain net income, and any recognized and undistributed taxable income from prior years.

ASC Topic 740 Accounting for Uncertainty in Income Taxes (“ASC 740”), provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed. ASC 740 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the tax returns to determine whether the tax positions are “more-likely-than-not” of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold are recorded as a tax benefit or expense in the current year. Determinations regarding ASC 740 may be subject to review and adjustment at a

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

later date based upon factors including, but not limited to, an ongoing analysis of tax laws, regulations and interpretations thereof. We are not aware of any tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits will change materially in the next 12 months.

Investment Income

For debt investments, we record interest income on the accrual basis to the extent that such amounts are expected to be collected. OID and purchased discounts and premiums are accreted/amortized into interest income using the effective interest method, where applicable. Loan origination fees are deferred and accreted into interest income using the effective interest method. We record prepayment premiums on loans and other investments as interest income when such amounts are received. We stop accruing interest on investments when it is determined that interest is no longer collectible. As of June 30, 2015 and December 31, 2014, we had no loans on non-accrual status.

Interest income on the CLO equity investments is recognized using the effective interest method as required by ASC Subtopic 325-40, Investments-Other, Beneficial Interests in Securitized Financial Assets. At the time of purchase, we estimate the expected future cash flows and determine the effective interest rate based on these estimated cash flows and our cost basis. Subsequent to the purchase, the estimated future cash flows are updated quarterly and a revised yield is calculated prospectively based on the current amortized cost of the investment as adjusted for credit impairments, if any.

Cash and Cash Equivalents

Cash and cash equivalents consist of demand deposits and highly liquid financial instruments with original maturities of 90 days or less including those held in overnight sweep bank deposit accounts. Cash and cash equivalents are carried at cost, which approximates fair value. We place our cash and cash equivalents with financial institutions and, at times, cash held in bank accounts may exceed the Federal Deposit Insurance Corporation insured limit.

Consolidation

As permitted under Regulation S-X and as explained by ASC 946-810-45, Financial Services - Investment Companies - Consolidation, we will generally not consolidate an investment in a company other than an investment company subsidiary or a controlled operating company whose business consists primarily of providing services to us. Accordingly, we have consolidated the results of ACSF Funding in our consolidated financial statements.

Deferred Financing Costs

Deferred financing costs represent fees and other direct expenses incurred in connection with the issuance of debt. These costs are capitalized and amortized into interest expense over the estimated average life of the borrowings.

Offering Costs

Offering costs consist of fees and expenses incurred in connection with the issuance of common stock including legal, accounting, printing and other related expenses, as well as costs incurred in connection with the filing of a shelf registration statement. These costs are capitalized when incurred and recognized as a reduction to offering proceeds when the offering becomes effective. There were no offering costs charged to capital during the three and six months ended June 30, 2015 and $844 of offering costs charged to capital for each of the three and six months ended June 30, 2014. The underwriting commissions associated with our IPO in January 2014 were paid for by our Manager and were not reflected as a reduction to capital at the time of the IPO.

Dividends to Common Stockholders

Dividends to common stockholders are recorded on the ex-dividend date.

Other General and Administrative Expenses

Other general and administrative expenses include audit and tax, professional fees, board of directors' fees, rent, IT system costs, custody, transfer agent and other operating expenses. Expenses are recognized on an accrual basis.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

New Accounting Pronouncements

In April 2015, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2015-03, Interest-Imputation of Interest (Subtopic 835-30) Simplifying the Presentation of Debt Issuance Costs (“ASU 2015-03”) which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. An entity is required to apply the guidance in ASU 2015-03 on a retrospective basis such that the balance sheet of each individual period presented is adjusted to reflect the period-specific effects of applying the new guidance. Upon transition, an entity is required to comply with the applicable disclosures for a change in an accounting principle including the nature of and reason for the change in accounting principle, the transition method, a description of the prior-period information that has been retrospectively adjusted, and the effect of the change on the financial statement line items (that is, debt issuance cost asset and the debt liability). ASU 2015-03 is effective for public business entities for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been previously issued. We are currently evaluating the impact of ASU 2015-03 on our consolidated financial statements and do not believe its adoption will have a material impact on our consolidated financial statements.

In May 2015, the FASB issued ASU No. 2015-07, Fair Value Measurement (Subtopic 820) - Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent) (“ASU 2015-07”), which removes the requirement to include, as well as provide certain disclosure for, investments in the fair value hierarchy for which the fair value is measured at net asset value using the practical expedient. Disclosures are limited to investments for which the entity has elected to measure the fair value using that practical expedient. ASU 2015-07 is effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted. We are currently evaluating the impact of ASU 2015-07 and do not believe its adoption will have a material impact on our consolidated financial statements.

Note 3. Management Agreement

We have entered into a management agreement with our Manager effective January 15, 2014. Under the management agreement, our Manager has agreed to provide investment advisory services to us, in addition to providing personnel, facilities and additional services necessary for our operations. Unless terminated earlier, the management agreement will remain in effect until January 15, 2016. It will remain in effect from year-to-year thereafter if approved annually by our Board of Directors or by the affirmative vote of the holders of a majority of our outstanding voting securities, and, in either case if also approved by a majority of our directors who are not "Interested Persons" as defined under the 1940 Act.

Our Manager receives a management fee from us that is payable quarterly in arrears. The management fee is calculated at an annual rate of 0.80% of our total consolidated assets, excluding cash and cash equivalents and net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. There is no incentive compensation paid to our Manager under the management agreement. For the three and six months ended June 30, 2015, we recognized management fees of $563 and $1,141, respectively. The management fee is prorated for any partial period and totaled $574 and $1,000 for the three and six months ended June 30, 2014, respectively.

Since our Manager has no employees, it has entered into an administrative services agreement with both its parent and American Capital pursuant to which our Manager will be provided with personnel, services and resources necessary for our Manager to perform its obligations under the management agreement.

For 24 months following the date of our IPO, our Manager has agreed to be responsible for certain of our operating expenses in excess of 0.75% of our consolidated net assets, less net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter (the "Expense Cap"). Operating expenses subject to this reimbursement include both (i) our operating expenses reimbursed to our Manager and its affiliates for the expenses related to our operations incurred on our behalf and (ii) our operating expenses directly incurred by us excluding the management fee, interest costs, taxes and accrued costs and fees related to actual, pending or threatened litigation, each as determined under GAAP for the most recently completed fiscal quarter. As a result of this Expense Cap, any reimbursements to our Manager and its affiliates could be reduced or eliminated, and in certain instances, our Manager could be required to reimburse us so that our other expenses do not exceed the Expense Cap. Subsequent to the first full 24 months after the date of our IPO, there are no limits on the reimbursement to our Manager or its affiliates of such expenses related to our operations. For the three and six months ended June 30, 2015, our Manager was responsible for $227 and $472, respectively, of operating expenses as a result of the Expense Cap. For the three and six months ended June 30, 2014, our Manager was responsible for $264 and $554, respectively, of operating expenses as a result of the Expense Cap.    

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AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

Note 4. Related Party Transactions

Administrative Services Agreement and Management Agreement

Our Manager has entered into an administrative services agreement whereby the Manager has agreed to reimburse American Capital and its affiliates for certain expenses incurred on our behalf. Pursuant to our management agreement, we are responsible for reimbursing our Manager, American Capital and its affiliates for expenses incurred on our behalf, excluding employment-related expenses of our and our Manager’s officers and any employees of American Capital or its affiliates who provide services to us pursuant to the management agreement or to our Manager pursuant to the administrative services agreement. In addition, our Manager or one of its affiliates may pay for or incur certain expenses and then allocate these expenses to ACSF. For the three and six months ended June 30, 2015, we recognized $222 and $484, respectively, of expenses that are reimbursable to our Manager and its affiliates. For the three and six months ended June 30, 2014, we recognized $243 and $509, respectively, of expenses that are reimbursable to our Manager and its affiliates. Refer to Note 3 for additional information on the management agreement.

Securities Transactions

We may, from time to time, purchase securities from, or sell securities to affiliates of our Manager at fair market value on the trade date. During the three and six months ended June 30, 2015, there were no purchases or sales of securities to affiliates of our Manager. During the three and six months ended June 30, 2014, total proceeds from sales to affiliates were $8,515 and $15,059, respectively.

Note 5. Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended June 30,				Six Months Ended June 30,
	2015		2014		2015		2014
Numerator—net increase in net assets resulting from operations	$	3,159	$	2,849	$	6,950	$	4,969
Denominator—weighted average shares (1)	10,000,100		10,000,100		10,000,100		10,000,100
Earnings per share	$	0.32	$	0.28	$	0.70	$	0.50

(1) Assumes the 10,000,000 common shares issued in our IPO on January 22, 2014 were issued on January 1, 2014.

Note 6. Investments

We value our investments at fair value in accordance with ASC 820, which defines fair value as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Due to the uncertainty inherent in the valuation process, estimates of fair value may differ significantly from the values that would have been used had a ready market for our investments existed, and the differences could be material. Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on the investments to be different than the valuations currently assigned.

ASC 820 provides a framework for measuring the fair value of assets and liabilities and provides guidance regarding a fair value hierarchy, which prioritizes information used to measure fair value and the effect of fair value measurements on earnings. When available, we determine the fair value of our investments using unadjusted quoted prices from active markets. Where inputs for an asset or liability fall into more than one level in the fair value hierarchy, the investment is classified in its entirety based on the lowest level input that is significant to that investment’s fair value measurement. We use judgment and consider factors specific to the investment when determining the significance of an input to a fair value measurement. Our policy is to recognize transfers in and out of levels as of the beginning of each reporting period. The three levels of the fair value hierarchy and investments that fall into each of the levels are described below:

Level 1: Inputs are unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. This may include valuations based on executed trades, broker quotations that constitute an executable price, and alternative pricing sources supported by observable inputs which, in each case, are either directly or indirectly observable for the asset in connection with market data at the measurement date.

Level 3: Inputs are unobservable and cannot be corroborated by observable market data. In certain cases, investments classified within Level 3 may include securities for which we have obtained indicative quotes from broker-dealers that do not necessarily represent prices the broker may be willing to trade on.

The valuation techniques used maximize the use of observable inputs and minimize the use of unobservable inputs. Our SFRLs are predominately valued based on evaluated prices from a nationally recognized independent pricing service or from third-party brokers who make markets in such debt investments. When possible, we make inquiries of third-party pricing sources to understand their use of significant inputs and assumptions. We review the third-party fair value estimates and perform procedures to validate their reasonableness, including an analysis of the range and dispersion of third-party estimates, frequency of pricing updates, comparison of recent trade activity for similar securities, and review for consistency with market conditions observed as of the measurement date.

There may be instances when independent or third-party pricing sources are not available, or cases where we believe that the third-party pricing sources do not provide sufficient evidence to support a market participant’s view of the fair value of the debt investment being valued. These instances may result from an investment in a less liquid loan such as a middle market loan, a mezzanine loan or unitranche loan, or a loan to a company that has become financially distressed. In these instances, we may estimate the fair value based on a combination of a market yield valuation methodology and evaluated pricing discussed above, or solely based on a market yield valuation methodology. Under the market yield valuation methodology, we estimate the fair value based on a discounted cash flow technique. For these debt investments, the unobservable inputs used in the market yield valuation methodology to measure fair value reflect management’s best estimate of assumptions that would be used by market participants when pricing the investment in a hypothetical transaction, including estimated remaining life, current market yield and interest rate spreads of similar loans and securities as of the measurement date. We will estimate the remaining life based on market data for the average life of similar loans. However, if we have information that the loan is expected to be repaid in the near term, we would use an estimated remaining life based on the expected repayment date. The average life to be used to estimate the fair value of our loans may be shorter than the legal maturity of the loans since many loans are prepaid prior to the maturity date. The interest rate spreads used to estimate the fair value of our loans is based on current interest rate spreads of similar loans. If there is a significant deterioration of the credit quality of a loan, we may consider other factors that a hypothetical market participant would use to estimate fair value, including the proceeds that would be received in a liquidation analysis.

We estimate the fair value of our CLO equity investments using a combination of third-party broker quotes, purchases or sales of the same or similar securities, and cash flow forecasts subject to assumptions that a market participant would use regarding the investments’ underlying collateral including, but not limited to, assumptions for default and recovery rates, reinvestment spreads and prepayment rates. Cash flow forecasts are discounted using market participant’s market yield assumptions that are derived from multiple sources including, but not limited to, third-party broker quotes, industry research reports and transactions of securities and indices with similar structures and risk characteristics. We weight the use of third-party broker quotes, if any, when determining fair value based on our understanding of the level of actual transactions used by the broker to develop the quote and whether the quote was an indicative price or binding offer, the depth and consistency of broker quotes and the correlation of changes in broker quotes with underlying performance and other market indices. For the six months ended June 30, 2015, there were no changes to our valuation techniques or to the types of unobservable inputs used in the valuation process compared to the period ended December 31, 2014.

The following fair value hierarchy tables set forth our investments measured at fair value on a recurring basis by level as of June 30, 2015 and December 31, 2014:

	June 30, 2015
	Total		Level 1		Level 2		Level 3
First lien floating rate loans	$	190,427	$	—	$	190,427	$	—
Second lien floating rate loans	27,914		—		27,494		420
CLO equity	53,850		—		—		53,850
Total Investments	$	272,191	$	—	$	217,921	$	54,270

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

	December 31, 2014
	Total		Level 1		Level 2		Level 3
First lien floating rate loans	$	194,952	$	—	$	189,274	$	5,678
Second lien floating rate loans	29,841		—		26,601		3,240
CLO equity	51,577		—		—		51,577
Total Investments	$	276,370	$	—	$	215,875	$	60,495

The following table provides a summary of the changes in fair value of Level 3 assets for the six months ended June 30, 2015 as well as the portion of net unrealized (depreciation) / appreciation for the six months ended June 30, 2015 related to those assets still held as of June 30, 2015:

	First Lien Floating Rate Loans			Second Lien Floating Rate Loans			CLO Equity			Total
Beginning Balance – December 31, 2014	$	5,678		$	3,240		$	51,577		$	60,495
Purchases	—			—			8,206			8,206
Sales	—			—			(2,283		)	(2,283		)
Repayments (1)	(11		)	—			(6,527		)	(6,538		)
Amortization of discount/premium (2)	2			—			3,582			3,584
Transfers out (3)	(6,892		)	(3,240		)	—			(10,132		)
Transfers in (3)	1,249			493			—			1,742
Realized gains, net	—			—			278			278
Unrealized depreciation, net	(26		)	(73		)	(983		)	(1,082		)
Ending Balance – June 30, 2015	$	—		$	420		$	53,850		$	54,270
Net change in unrealized depreciation reported within the net change in unrealized (depreciation) / appreciation on investments in our consolidated statement of operations attributable to our Level 3 assets still held as of June 30, 2015	$	—		$	(73	)	$	(767	)	$	(840	)

(1) Includes cash distributions from CLO equity investments.

(2) Includes income accrual from CLO equity investments determined using the effective interest method.

(3) Investments were transferred into and out of Level 3 and Level 2 due to changes in the quantity and quality of inputs obtained to support the fair value of each investment. Transfers into and out of the levels are recognized at the beginning of each quarterly period.    

Note 7. Debt

Revolving Credit Facility

On October 15, 2013, we entered into a revolving credit facility with ACAM (the “ACAM Facility”) which provided up to $200,000 to finance eligible investments, working capital expenses and general corporate requirements (comprised of Loan A and Loan B). Under the ACAM Facility, we were able to draw up to $180,000 under Loan A and up to $20,000 under Loan B at any one time. Any amounts drawn on Loan A had a fixed interest rate of 4.75% per annum and any amounts drawn on Loan B had a fixed interest rate of 7.25% per annum, with all interest paid upon maturity of the ACAM Facility. The ACAM Facility matured on the closing date of our IPO. On January 22, 2014, we repaid the ACAM Facility in full plus accrued interest and terminated it. For the three months ended March 31, 2014, we incurred interest expense of $568 on the ACAM Facility.

Secured Revolving Credit Facility

On December 18, 2013, ACSF Funding entered into a two-year $140,000 secured revolving credit facility with Bank of America, N.A., as agent (the “Credit Facility”). ACSF Funding may make draws under the Credit Facility from time to time to purchase or acquire certain eligible assets. The Credit Facility is secured by ACSF Funding’s assets pursuant to a security agreement and contains customary financial and negative covenants and events of default. As of June 30, 2015 and December 31, 2014, the fair value of the assets pledged as collateral in ACSF Funding were $214,408 and $220,421, respectively. The Credit Facility is non-recourse to ACSF. Amounts drawn under the Credit Facility bear interest at a rate per annum equal to either (a) LIBOR plus

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

1.80%, or (b) 0.80% plus the highest of (i) the Federal funds rate plus 0.50%, (ii) Bank of America, N.A.’s prime rate or (iii) one-month LIBOR plus 1%. ACSF Funding may borrow, prepay and reborrow loans under the Credit Facility at any time prior to November 18, 2015, the commitment termination date, subject to certain terms and conditions, including maintaining a borrowing base. Any outstanding balance on the Credit Facility as of the commitment termination date must be repaid by the maturity date, which is December 18, 2015, unless otherwise extended. As of June 30, 2015, ACSF Funding may terminate the commitment amount in whole or in part without incurring a termination fee.

ACSF Funding is required to pay a commitment fee in an amount equal to 0.75% on the actual daily unused amount of the lender commitments under the Credit Facility from February 14, 2014 to the commitment termination date, payable quarterly in arrears.

As of June 30, 2015, there was $123,800 outstanding under the Credit Facility, which had a fair value of $123,800 and a weighted average interest rate of 1.99%. As of December 31, 2014, there was $130,000 outstanding under the Credit Facility, which had a fair value of $130,000 and a weighted average interest rate of 1.96%. The fair value of the Credit Facility is determined in accordance with ASC 820, which defines fair value in terms of the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions and is measured with Level 3 inputs. As of June 30, 2015 and December 31, 2014, ACSF Funding was in compliance with all covenants of the Credit Facility, including compliance with a borrowing base that applies various advance rates of up to 80% on the investments pledged as collateral by ACSF Funding.

For the three and six months ended June 30, 2015, we incurred interest and commitment fees on the Credit Facility of $661 and $1,319, respectively. For the three and six months ended June 30, 2014, we incurred interest and commitment fees on the Credit Facility of $683 and $1,107, respectively.

The following table outlines key statistics related to our debt financing for the three and six months ended June 30, 2015 and 2014:

	Three Months Ended June 30,		Six Months Ended June 30,
	2015	2014 (1)	2015	2014 (1)
Average debt outstanding	$126,259	$132,364	$127,601	$125,815
Weighted average annual interest rate	1.99%	2.00%	1.98%	2.59%
Commitment fee as a percent of average debt outstanding	0.11%	0.07%	0.10%	0.09%
Amortization of deferred financing costs as a percent of average debt outstanding	0.31%	0.29%	0.31%	0.31%
Total annualized cost of funding	2.41%	2.36%	2.39%	2.99%
Maximum amount of debt outstanding	$131,900	$137,000	$134,600	$194,748

(1) The information presented includes costs associated with both the ACAM Facility and Credit Facility.

Note 8. Taxes

Tax Sharing Agreement

For the period prior to our IPO, during which we were treated as a taxable corporation under Subchapter C of the Code ("C corporation") for tax purposes, we had a tax sharing agreement with American Capital and other members of its consolidated tax group, under which such members bore their full share of their individual tax obligation and members were compensated for their losses and other tax benefits that were able to be used by other members of the consolidated tax group based on their pro-forma stand-alone federal income tax return. The provision (benefit) for income taxes attributable to our taxable income prior to our IPO was $1,057, of which $279 was recognized during the six months ended June 30, 2014, and ($24) was recognized during the six months ended June 30, 2015.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

We intend to apply for retroactive relief under IRC Section 9100 to make a “deemed sale election” whereby we will treat our net unrealized gains (“Net Built-in Gain”) on the date of our IPO as recognized for tax purposes in our final pre-IPO C corporation federal tax return. We anticipate the IRS will grant this relief, and we have therefore treated the Net Built-in Gain on the date of our IPO as recognized for tax purposes in our final pre-IPO C corporation federal tax return. The federal estimated tax sharing payment that we owed to American Capital attributed to our Net Built-in Gain was $562. The amount of the tax provision (benefit) recognized on the Net Built-in Gain was $159 during the six months ended June 30, 2014 and ($11) during the six months ended June 30, 2015. The entire amount was treated as a deemed capital contribution to (distribution by) us.

Income Taxes

We intend to file an election to be treated as a RIC for income tax purposes on our federal income tax return beginning with the date of our IPO. In order to qualify as a RIC, among other things, we are required to distribute annually at least 90% of our ordinary income, including net short term gains in excess of net long term losses. So long as we qualify as a RIC, we are not subject to the entity level taxes on earnings timely distributed to our stockholders. We intend to make sufficient annual distributions to substantially eliminate our corporate level income taxes.

Income determined under GAAP differs from income determined under tax because of both temporary and permanent differences in income and expense recognition, including (i) unrealized gains and losses associated with debt investments marked to fair value for GAAP but excluded from taxable income until realized or settled, (ii) timing difference on income recognition for our CLO equity investments, (iii) premium amortization and gain adjustments attributable to the Net Built-in Gain recognized upon our IPO and (iv) capital losses in excess of capital gains do not reduce taxable income, and generally can be carried forward to offset capital gains.

At our discretion, we may delay distributions of a portion of our current year taxable income to the subsequent year and pay 4% excise taxes on such deferred distributions as calculated under the Code. If we anticipate paying excise taxes, we accrue excise taxes on a quarterly basis based on our estimates. For the three and six months ended June 30, 2015, we accrued excise tax of $70 and $140, respectively. For the three and six months ended June 30, 2014, we accrued excise tax of $30 and $30, respectively.

F-25

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

Note 9. Consolidated Financial Highlights

	Six Months Ended June 30,
	2015			2014
Per Share Data (1):
Net asset value, beginning of period  (2)	$	14.42		$	15.00
Net investment income	0.63			0.49
Net realized and unrealized gain on investments	0.07			0.01
Net increase in net assets resulting from operations	0.70			0.50
Capital contribution (3)	—			0.06
Accretion (4)	—			0.10
Offering costs related to public offering	—			(0.08		)
Dividends to stockholders from net investment income	(0.58		)	(0.46		)
Net asset value, end of period	$	14.54		$	15.12
Per share market value, end of period	$	12.65		$	14.00
Total return based on market value (5), (9)	9.09		%	(3.58		)%
Total return based on net asset value (5), (9)	5.30		%	4.13		%
Ratios to Average Net Assets:
Net investment income (6)	8.67		%	6.88		%
Operating expenses (6), (7)	2.35		%	2.46		%
Interest and related expenses (6)	2.09		%	2.72		%
Total expenses (6), (7)	4.44		%	5.18		%
Supplemental Data:
Net assets, end of period	$	145,364		$	151,189
Shares outstanding, end of period	10,000,100			10,000,100
Average debt outstanding	$	127,601		$	125,815
Asset coverage per unit, end of period (8)	2,174			2,181
Portfolio turnover ratio (9)	27.59		%	23.81		%

(1) Per share data for the six months ended June 30, 2014 assumes the issuance of 10 million shares of common stock on January 1, 2014 that were issued in the IPO, which closed on January 22, 2014. There was no established public trading market for the stock prior to the pricing of the IPO.

(2) The IPO price of $15.00 per share was used as the net asset value, beginning of period for the six months ended June 30, 2014.

(3) Capital contribution from our Manager for $574 of federal taxes due on the Net Built-in Gain on investments as a result of tax conversion to a RIC at the time of the IPO was treated as a deemed contribution for the six months ended June 30, 2014 and ($11), which rounds to zero, was treated as a deemed distribution for the six months ended June 30, 2015.

(4) The IPO issuance price of $15.00 per share was below the net asset value at that time. The amount reflects the immediate benefit to common stockholders at the time of the IPO for results of operations in 2013.

(5) Total return is based on the change in market price or net asset value per share during the period and takes into account dividends reinvested in accordance with the dividend reinvestment and stock purchase plan. The IPO price of $15.00 per share was used as the starting value for the total return for the six months ended June 30, 2014.

(6) Annualized for periods less than one year.

(7) The ratio of operating expenses to average net assets and the ratio of total expenses to average net assets are shown net of the reimbursement for the Expense Cap. The ratio of operating expenses to average net assets and the ratio of total expenses to average net assets would be 3.00% and 5.09%, respectively, without the expense cap for the six months ended June 30, 2015 and 3.26% and 5.98%, respectively, without the Expense Cap for the six months ended June 30, 2014.

(8) The asset coverage ratio for a class of senior securities representing indebtedness is calculated on our consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by the senior securities representing indebtedness. This asset coverage ratio is multiplied by $1,000 to determine the asset coverage per unit.

(9) Not annualized for periods less than one year.

F-26

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

Note 10. Capital Transactions

The following table details the common stock transactions that occurred during the six months ended June 30, 2015 and 2014:

	Six Months Ended June 30,
	2015				2014
	Shares	Amount (1)			Shares	Amount (1)
Common stock outstanding - beginning of period	10,000,100	$	151,231		100	$	1
Common stock issued in connection with the IPO	—	—			10,000,000	150,000
Offering costs	—	—			—	(844		)
Contribution/(distribution) for taxes waived	—	(11		)	—	574
Permanent differences reclassified (see Note 8)	—	11			—	—
Common stock outstanding - end of period	10,000,100	$	151,231		10,000,100	$	149,731

(1) Includes amount reflected in common stock, par value and paid-in capital in excess of par.

Offering costs associated with the IPO totaled $844 and were recorded as a reduction of the proceeds from the IPO. In connection with the IPO, the underwriters received an underwriting discount and commission (sales load) of $7,952 that was paid by our Manager.

The table below details the dividends declared on our shares of common stock since the completion of our IPO:

Quarterly Dividend Declaration Date	Ex-Dividend Date	Record Date	Payment Date	Per Share Amount	Total Amount
March 17, 2014	March 27, 2014	March 31, 2014	April 10, 2014	$0.180	$1,800
June 18, 2014	June 26, 2014	June 30, 2014	July 10, 2014	$0.280	$2,800
September 17, 2014	September 26, 2014	September 30, 2014	October 10, 2014	$0.280	$2,800
December 18, 2014	December 29, 2014	December 31, 2014	January 9, 2015	$0.290	$2,900
March 19, 2015	March 27, 2015	March 31, 2015	April 6, 2015	$0.290	$2,900
Monthly Dividend Declaration Date	Ex-Dividend Date	Record Date	Payment Date	Per Share Amount	Total Amount
March 19, 2015	April 17, 2015	April 21, 2015	May 4, 2015	$0.097	$970
May 4, 2015	May 20, 2015	May 22, 2015	June 2, 2015	$0.097	$970
May 4, 2015	June 17, 2015	June 19, 2015	July 2, 2015	$0.097	$970
May 4, 2015	July 22, 2015	July 24, 2015	August 4, 2015	$0.097	$970
August 3, 2015	August 19, 2015	August 21, 2015	September 2, 2015	$0.097	$970
August 3, 2015	September 18, 2015	September 22, 2015	October 2, 2015	$0.097	$970
August 3, 2015	October 21, 2015	October 23, 2015	November 3, 2015	$0.097	$970
Inception to Date Total				$1.999	$19,990

Note 11. Commitments and Contingencies

In the ordinary course of business, we may be a party to certain legal proceedings, including actions brought against us and others with respect to investment transactions. The outcomes of any such legal proceedings are uncertain and, as a result of these proceedings, the values of the investments to which they relate could decrease. We were not subject to any material litigation against us as of June 30, 2015 or December 31, 2014.

We did not engage in any off-balance sheet activities as of June 30, 2015 or December 31, 2014.

F-27

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)(continued)

JUNE 30, 2015

(in thousands, except share and per share amounts)

Note 12. Subsequent Event

On August 3, 2015, we declared monthly dividends of $0.097 per share for each of August, September and October 2015.

AMERICAN CAPITAL SENIOR FLOATING, LTD.

INDEX TO DECEMBER 31, 2014 CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Accounting Firm	F-29
Consolidated Statements of Assets and Liabilities as of December 31, 2014 and 2013	F-30
Consolidated Statements of Operations for the year ended December 31, 2014 and the period from October 15, 2013 to December 31, 2013	F-31
Consolidated Statements of Changes in Net Assets for the year ended December 31, 2014 and the period from October 15, 2013 to December 31, 2013	F-32
Consolidated Statements of Cash Flows for the year ended December 31, 2014 and the period from October 15, 2013 to December 31, 2013	F-33
Consolidated Schedule of Investments as of December 31, 2014	F-34
Consolidated Schedule of Investments as of December 31, 2013	F-39
Notes to Consolidated Financial Statements	F-43

F-28

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders of American Capital Senior Floating, Ltd.

We have audited the accompanying consolidated statements of assets and liabilities of American Capital Senior Floating, Ltd. (the “Company”), including the consolidated schedules of investments, as of December 31, 2014 and 2013, and the related consolidated statements of operations, changes in net assets, and cash flows for the year ended December 31, 2014 and for the period from October 15, 2013 (commencement of operations) through December 31, 2013. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of December 31, 2014 and December 31, 2013, by correspondence with the custodian and others, or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of American Capital Senior Floating, Ltd. at December 31, 2014 and 2013, and the consolidated results of its operations, changes in its net assets, and its cash flows for the year ended December 31, 2014 and for the period from October 15, 2013 (commencement of operations) through December 31, 2013, in conformity with U.S. generally accepted accounting principles.

/s/ Ernst & Young, LLP

McLean Virginia

March 26, 2015

F-29

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

(in thousands, except share and per share data)

	December 31, 2014			December 31, 2013
Assets:
Investments, fair value (cost of $282,133 and $198,268, respectively)	$	276,370		$	199,565
Cash and cash equivalents	1,757			12,493
Receivable for investments sold	2,983			5,394
Deferred financing costs	378			474
Interest receivable	704			303
Prepaid expenses and other assets	121			467
Receivable from affiliate (see note 3)	164			—
Total assets	$	282,477		$	218,696
Liabilities:
Secured revolving credit facility payable (see note 7)	$	130,000		$	—
Revolving credit facility payable (see note 7)	—			194,748
Payable for investments purchased	4,226			20,494
Dividends payable (see note 10)	2,900			—
Management fee payable (see note 3)	577			—
Interest payable (see note 7)	80			943
Taxes payable (see note 8)	80			803
Payable to affiliate (see note 3)	212			295
Other liabilities and accrued expenses	167			397
Total liabilities	138,242			217,680
Commitments and contingencies (see note 11)
Net Assets:
Common stock, par value $0.01 per share; 10,000,100 and 100 issued and outstanding, respectively; 300,000,000 and 1,000 authorized, respectively	100			—
Paid-in capital in excess of par	151,131			1
Undistributed net investment income	133			246
Accumulated net realized loss from investments	(1,366		)	(7		)
Net unrealized (depreciation) appreciation on investments	(5,763		)	776
Total net assets	144,235			1,016
Total liabilities and net assets	$	282,477		$	218,696
Net asset value per share outstanding	$	14.42		N/A

See notes to the consolidated financial statements.

F-30

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

	Year Ended			Period from October 15, 2013* to
	December 31, 2014			December 31, 2013
Investment income:
Interest	$	17,773		$	1,572
Total investment income	17,773			1,572
Expenses:
Interest and commitment fee (see note 7)	3,055			943
Management fee (see note 3)	2,186			—
Insurance	521			—
Amortization of deferred financing costs	393			8
Organizational costs	—			47
Other general and administrative expenses	1,601			46
Total expenses	7,756			1,044
Expense reimbursement (see note 3)	(1,001		)	—
Net expenses	6,755			1,044
Net investment income before tax	11,018			528
Income tax provision	(159		)	(282		)
Net investment income	10,859			246
Net (loss) gain on investments:
Net realized gain (loss) on investments	190			(7		)
Net unrealized (depreciation) appreciation on investments	(7,060		)	1,297
Income tax provision	(200		)	(521		)
Net (loss) gain on investments	(7,070		)	769
Net increase in net assets resulting from operations	$	3,789		$	1,015
Net investment income per share	$	1.09		n/a
Earnings per share (see note 4)	$	0.38		n/a
Dividend declared per share	$	1.03		n/a
Weighted average shares outstanding	10,000			n/a

* Commencement of operations

See notes to consolidated financial statements.

F-31

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

(in thousands)

	Year Ended			Period from October 15, 2013* to
	December 31, 2014			December 31, 2013
Increase in net assets resulting from operations:
Net investment income	$	10,859		$	246
Net realized gain (loss)	190			(7		)
Net unrealized (depreciation) appreciation on investments	(7,260		)	776
Net increase in net assets resulting from operations	3,789			1,015
Distributions to common stockholders:
From net investment income	(10,300		)	—
Capital transactions:
Proceeds from public offering	150,000			—
Offering costs	(844		)	—
Contribution for taxes waived (see note 8)	574			—
Net increase in net assets from capital transactions	149,730			—
Net increase in net assets	143,219			1,015
Net assets:
Beginning of period	1,016			1
End of period	$	144,235		$	1,016
Capital share activity:
Shares issued in public offering	10,000			n/a

* Commencement of operations

See notes to consolidated financial statements.

F-32

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended			Period from October 15, 2013* to
	December 31, 2014			December 31, 2013
Cash Flows from Operating Activities:
Net increase in net assets resulting from operations	$	3,789		$	1,015
Adjustments to reconcile net increase in net assets resulting from operations:
Net realized (gain) loss on investments	(190		)	7
Net change in unrealized depreciation (appreciation) on investments	7,060			(1,297		)
Accretion of CLO interest income	(5,501		)	(516		)
Net amortization of premium/discount on loans	(7		)	(1		)
Amortization of deferred financing costs	393			9
Purchase of investments	(226,628		)	(207,548		)
Proceeds from dispositions of investments	148,461			9,790
Decrease (increase) in receivable for investments sold	2,411			(5,394		)
(Decrease) increase in payable for investments purchased	(16,268		)	20,494
Increase in receivable from affiliate	(164		)	—
Increase in interest receivable	(401		)	(303		)
Decrease (increase) in prepaid expenses and other assets	346			(467		)
(Decrease) increase in interest payable	(863		)	943
(Decrease) increase in other liabilities and accrued expenses	(230		)	397
(Decrease) increase in payable to affiliate	(83		)	295
Increase in management fee payable	577			—
(Decrease) increase in taxes payable	(149		)	803
Net cash used in operating activities	(87,447		)	(181,773		)
Cash Flows from Financing Activities:
Proceeds from the issuance of common stock	150,000			—
Offering costs from the issuance of common stock	(844		)	—
Dividends paid	(7,400		)	—
Proceeds from debt	199,500			194,748
Payments on debt	(264,248		)	—
Deferred financing costs paid	(297		)	(483		)
Net cash provided by financing activities	76,711			194,265
Net (decrease) increase in cash and cash equivalents	(10,736		)	12,492
Cash and cash equivalents at beginning of period	12,493			1
Cash and cash equivalents at end of period	$	1,757		$	12,493
Supplemental disclosure of cash flow information:
Cash paid for interest and commitment fees	$	3,918		$	—
Cash paid for income taxes	$	517		$	—
Dividends declared and payable during the period	$	10,300		$	—
Supplemental disclosure of non-cash financing activity:
Contribution for taxes waived	$	574		$	—

* Commencement of operations

See notes to consolidated financial statements.

F-33

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
Non-Control/Non-Affiliate Investments
First Lien Floating Rate Loans — 135.2% of net assets
24 Hour Fitness Worldwide, Inc. (6)	5/28/2021	4.75	%	L+3.75	Hotels, Restaurants & Leisure	$	2,178	$	2,171	$	2,095
Accellent Inc. (6)	3/12/2021	4.50	%	L+3.50	Health Care Equipment & Supplies	1,985		1,985		1,947
Acosta Holdco, Inc. (6)	9/24/2021	5.00	%	L+4.00	Media	2,500		2,482		2,504
Aegis Toxicology Sciences Corporation (6)	2/24/2021	5.50	%	L+4.50	Health Care Providers & Services	1,658		1,648		1,662
Albertson’s LLC (6)	8/25/2021	4.50	%	L+4.50	Food & Staples Retailing	1,000		986		1,002
American Tire Distributors, Inc. (6)	6/1/2018	5.75	%	L+4.75	Distributors	1,489		1,489		1,493
AmWINS Group, LLC (6)	9/6/2019	5.25	%	L+4.25	Insurance	2,964		2,980		2,948
Aquilex LLC (6)	12/31/2020	5.00	%	L+4.00	Commercial Services & Supplies	1,980		1,976		1,943
ARG IH Corporation (6)	11/16/2020	4.75	%	L+3.75	Hotels, Restaurants & Leisure	2,475		2,485		2,472
Aristocrat Leisure Limited (3), (6)	10/20/2021	4.75	%	L+3.75	Hotels, Restaurants & Leisure	1,500		1,485		1,478
Ascend Learning, LLC (6)	7/31/2019	6.00	%	L+5.00	Diversified Consumer Services	596		593		593
Ascensus, Inc. (6)	12/2/2019	5.00	%	L+4.00	Commercial Services & Supplies	990		986		986
Aspen Dental Management, Inc. (6)	10/6/2016	7.00	%	L+5.50	Health Care Providers & Services	987		981		990
Asurion, LLC (6)	5/24/2019	5.00	%	L+3.75	Commercial Services & Supplies	1,970		1,972		1,948
Atlantic Power Limited Partnership (3), (6)	2/24/2021	4.75	%	L+3.75	Independent Power & Renewable Electricity Producers	821		818		810
BJ’s Wholesale Club, Inc. (6)	9/26/2019	4.50	%	L+3.50	Food & Staples Retailing	1,485		1,486		1,461
Blackboard Inc. (6)	10/4/2018	4.75	%	L+3.75	Software	2,460		2,461		2,442
BWay Intermediate Company, Inc. (6)	8/14/2020	5.55	%	L+4.50	Containers & Packaging	2,985		2,957		2,981
Calceus Acquisition, Inc. (6)	1/31/2020	5.00	%	L+4.00	Textiles, Apparel & Luxury Goods	2,963		2,975		2,875
Camp International Holding Company (6)	5/31/2019	4.75	%	L+3.75	Transportation Infrastructure	1,980		2,007		1,985
Caraustar Industries, Inc. (6)	5/1/2019	7.50	%	L+6.25	Containers & Packaging	742		736		738
Carecore National, LLC (6)	3/5/2021	5.50	%	L+4.50	Health Care Providers & Services	2,068		2,067		2,050
CCM Merger Inc. (6)	8/6/2021	4.50	%	L+3.50	Hotels, Restaurants & Leisure	977		970		967
CDRH Parent, Inc. (6)	7/1/2021	5.25	%	L+4.25	Health Care Providers & Services	1,496		1,500		1,478
Checkout Holding Corp. (6)	4/9/2021	4.50	%	L+3.50	Media	2,488		2,486		2,379
Citadel Plastics Holdings, Inc. (6)	11/5/2020	5.25	%	L+4.25	Chemicals	750		743		744
CityCenter Holdings, LLC (6)	10/16/2020	4.25	%	L+3.25	Hotels, Restaurants & Leisure	1,819		1,830		1,807
Connolly, LLC (6)	5/14/2021	5.00	%	L+4.00	Professional Services	1,493		1,479		1,482

F-34

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 135.2% of net assets
CPG International Inc. (6)	9/30/2020	4.75	%	L+3.75	Building Products	$	2,958	$	2,959	$	2,921
CPI Buyer, LLC (6)	8/16/2021	5.50	%	L+4.50	Trading Companies & Distributors	998		983		983
DAE Aviation Holdings, Inc. (6)	11/2/2018	5.00	%	L+4.00	Aerospace & Defense	1,362		1,376		1,362
Deltek, Inc. (6)	10/10/2018	4.50	%	L+3.50	Software	2,962		2,971		2,934
Dole Food Company, Inc. (6)	11/1/2018	4.50	%	L+3.50	Food Products	3,637		3,630		3,603
DPX Holdings B.V.  (3), (6)	3/11/2021	4.25	%	L+3.25	Life Sciences Tools & Services	1,990		1,986		1,937
DTZ U.S. Borrower, LLC (3), (5), (6)	11/4/2021	5.50	%	L+4.50	Real Estate Management & Development	1,250		1,231		1,250
Duff & Phelps Corporation (6)	4/23/2020	4.50	%	L+3.50	Capital Markets	3,456		3,458		3,424
DynCorp International Inc. (6)	7/7/2016	6.25	%	L+4.50	Aerospace & Defense	2,189		2,196		2,186
Electrical Components International, Inc. (6)	5/28/2021	5.75	%	L+4.75	Electrical Equipment	1,990		1,995		1,994
Emerald Expositions Holding, Inc. (6)	6/17/2020	4.75	%	L+3.75	Media	2,748		2,771		2,702
Evergreen Acqco 1 LP (6)	7/9/2019	5.00	%	L+3.75	Multiline Retail	1,995		2,002		1,935
EWT Holdings III Corp. (6)	1/15/2021	4.75	%	L+3.75	Machinery	990		986		974
Exgen Renewables I, LLC (6)	2/6/2021	5.25	%	L+4.25	Independent Power & Renewable Electricity Producers	1,408		1,413		1,415
Expro Finservices S.à r.l.  (3), (6)	9/2/2021	5.75	%	L+4.75	Energy Equipment & Services	1,995		1,966		1,646
Fairmount Minerals, Ltd. (6)	9/5/2019	4.50	%	L+3.50	Metals & Mining	2,963		2,978		2,701
Fitness International, LLC (6)	7/1/2020	5.50	%	L+4.50	Hotels, Restaurants & Leisure	1,301		1,289		1,249
Global Tel*Link Corporation (6)	5/22/2020	5.00	%	L+3.75	Diversified Telecommunications Services	1,704		1,675		1,691
Great Wolf Resorts, Inc. (6)	8/6/2020	5.75	%	L+4.75	Hotels, Restaurants & Leisure	2,962		2,969		2,946
Greeneden U.S. Holdings II, LLC (6)	11/13/2020	4.50	%	L+3.50	Software	1,980		1,971		1,965
HGIM Corp. (6)	6/18/2020	5.50	%	L+4.50	Marine	1,481		1,486		1,204
Hyland Software, Inc. (6)	2/19/2021	4.75	%	L+3.75	Software	1,355		1,349		1,346
Ikaria, Inc. (6)	2/12/2021	5.00	%	L+4.00	Health Care Providers & Services	2,504		2,509		2,498
Immucor, Inc. (6)	8/17/2018	5.00	%	L+3.75	Health Care Equipment & Supplies	995		1,003		985
Indra Holdings Corp. (6)	4/30/2021	5.25	%	L+4.25	Textiles, Apparel & Luxury Goods	1,244		1,232		1,231
Information Resources, Inc. (6)	9/30/2020	4.75	%	L+3.75	Professional Services	1,975		1,988		1,970
Inmar, Inc. (6)	1/27/2021	4.25	%	L+3.25	Commercial Services & Supplies	1,990		1,973		1,938
Interactive Data Corporation (6)	4/30/2021	4.75	%	L+3.75	Media	1,990		2,011		1,981
Ion Media Networks, Inc. (6)	12/18/2020	4.75	%	L+3.75	Media	1,985		1,997		1,965
J.C. Penney Corporation, Inc. (3), (6)	6/20/2019	5.00	%	L+4.00	Multiline Retail	1,496		1,493		1,442
Jazz Acquisition, Inc. (6)	6/18/2021	4.50	%	L+3.50	Aerospace & Defense	1,990		1,995		1,975
Key Safety Systems, Inc. (6)	8/27/2021	4.75	%	L+3.75	Auto Components	1,496		1,489		1,489
La Frontera Generation, LLC (6)	9/30/2020	4.50	%	L+3.50	Independent Power & Renewable Electricity Producers	1,839		1,850		1,817
Landmark Aviation FBO Canada, Inc.(3), (5), (6)	10/25/2019	4.75	%	L+3.75	Aerospace & Defense	76		76		75
Landslide Holdings, Inc. (6)	2/25/2020	5.00	%	L+4.00	Software	993		988		978

F-35

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 135.2% of net assets
Learning Care Group (US) No. 2 Inc. (6)	5/5/2021	5.50	%	L+4.50	Diversified Consumer Services	$	1,026	$	1,022	$	1,018
Leonardo Acquisition Corp. (6)	1/29/2021	4.25	%	L+3.25	Internet & Catalog Retail	2,978		2,989		2,901
LM U.S. Member LLC (5), (6)	10/25/2019	4.75	%	L+3.75	Aerospace & Defense	1,914		1,923		1,900
Millennium Health, LLC (6)	4/16/2021	5.25	%	L+4.25	Health Care Providers & Services	1,197		1,186		1,194
Mitchell International, Inc. (6)	10/13/2020	4.50	%	L+3.50	Software	2,977		2,992		2,943
Murray Energy Corporation (6)	12/5/2019	5.25	%	L+4.25	Oil, Gas & Consumable Fuels	2,977		2,965		2,875
National Financial Partners Corp. (6)	7/1/2020	4.50	%	L+3.50	Insurance	2,491		2,508		2,473
Onex Carestream Finance LP (6)	6/7/2019	5.00	%	L+4.00	Health Care Equipment & Supplies	1,858		1,865		1,854
Opal Acquisition, Inc. (6)	11/27/2020	5.00	%	L+4.00	Health Care Providers & Services	2,970		2,949		2,948
Ortho-Clinical Diagnostics S.A. (3), (6)	6/30/2021	4.75	%	L+3.75	Health Care Providers & Services	1,990		1,987		1,962
OSG Bulk Ships, Inc. (3), (6)	8/5/2019	5.25	%	L+4.25	Oil, Gas & Consumable Fuels	1,492		1,479		1,459
OSG International, Inc. (3), (6)	8/5/2019	5.75	%	L+4.75	Oil, Gas & Consumable Fuels	1,492		1,479		1,455
P2 Lower Acquisition, LLC (6)	10/22/2020	5.50	%	L+4.50	Health Care Providers & Services	2,112		2,106		2,091
Pharmedium Healthcare Corporation (6)	1/28/2021	4.25	%	L+3.25	Pharmaceuticals	2,370		2,383		2,307
Phillips-Medisize Corporation (6)	6/16/2021	4.75	%	L+3.75	Health Care Equipment & Supplies	1,221		1,219		1,205
PRA Holdings, Inc. (6)	9/23/2020	4.50	%	L+3.50	Life Sciences Tools & Services	1,638		1,638		1,620
Quikrete Holdings, Inc. (6)	9/28/2020	4.00	%	L+3.00	Construction Materials	2,836		2,848		2,803
RCHP, Inc. (6)	4/23/2019	6.00	%	L+5.00	Health Care Providers & Services	1,990		1,973		1,980
Renaissance Learning, Inc. (6)	4/9/2021	4.50	%	L+3.50	Software	1,985		1,983		1,947
RGIS Services, LLC (6)	10/18/2017	5.50	%	L+4.25	Commercial Services & Supplies	2,962		2,948		2,718
Scientific Games International Inc. (3), (6)	10/1/2021	6.00	%	L+5.00	Hotels, Restaurants & Leisure	2,000		1,981		1,976
Sears Roebuck Acceptance Corp. (3), (6)	6/29/2018	5.50	%	L+4.50	Multiline Retail	997		981		962
Securus Technologies Holdings, Inc. (6)	4/30/2020	4.75	%	L+3.50	Diversified Telecommunications Services	1,904		1,878		1,885
Spin Holdco Inc. (6)	11/14/2019	4.25	%	L+3.25	Diversified Consumer Services	2,970		2,971		2,929
Standard Aero Limited (3), (6)	11/2/2018	5.00	%	L+4.00	Aerospace & Defense	618		624		618
STHI Holding Corp.  (6)	8/6/2021	4.50	%	L+3.50	Life Sciences Tools & Services	1,995		1,986		1,984
STS Operating, Inc. (6)	2/12/2021	4.75	%	L+3.75	Trading Companies & Distributors	1,985		1,997		1,955
Surgery Center Holdings, Inc. (6)	11/3/2020	5.25	%	L+4.25	Health Care Providers & Services	2,000		1,990		1,953
Thermasys Corp. (6)	5/3/2019	5.25	%	L+4.00	Machinery	1,839		1,843		1,811
TMS International Corp. (6)	10/16/2020	4.50	%	L+3.50	Metals & Mining	2,970		2,976		2,977
TPF II LC, LLC (6)	9/29/2021	5.50	%	L+4.50	Independent Power & Renewable Electricity Producers	1,000		993		1,002

F-36

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued) — 135.2% of net assets
Travelport Finance (Luxembourg) S.à r.l. (3), (6)	9/2/2021	6.00	%	L+5.00	Internet Software & Services	$	2,000	$	1,976	$	2,000
Turbocombustor Technology, Inc. (6)	12/2/2020	5.50	%	L+4.50	Aerospace & Defense	3,465		3,435		3,433
Tyche Holdings, LLC (6)	11/12/2021	5.50	%	L+4.50	IT Services	1,850		1,844		1,843
USI, Inc. (6)	12/27/2019	4.25	%	L+3.25	Insurance	1,975		1,992		1,947
USIC Holdings, Inc. (6)	7/10/2020	4.00	%	L+3.00	Construction & Engineering	1,470		1,476		1,433
Veyance Technologies, Inc. (6)	9/8/2017	5.25	%	L+4.00	Machinery	1,496		1,496		1,494
Vitera Healthcare Solutions, LLC (6)	11/4/2020	6.00	%	L+5.00	Health Care Technology	2,228		2,212		2,216
WideOpenWest Finance, LLC (6)	4/1/2019	4.75	%	L+3.75	Media	2,975		3,001		2,962
WP CPP Holdings, LLC (6)	12/27/2019	4.75	%	L+3.75	Aerospace & Defense	2,962		2,956		2,947
Total First Lien Floating Rate Loans						$	198,221	$	198,028	$	194,952
Second Lien Floating Rate Loans — 20.7% of net assets
Accellent Inc. (6)	3/11/2022	7.50	%	L+6.50	Health Care Equipment & Supplies	$	1,500	$	1,497	$	1,421
Advantage Sales & Marketing Inc. (6)	7/25/2022	7.50	%	L+6.50	Professional Services	1,000		993		992
Ameriforge Group Inc.	12/21/2020	8.75	%	L+7.50	Energy Equipment & Services	500		500		493
Applied Systems, Inc.	1/24/2022	7.50	%	L+6.50	Software	1,000		993		981
Asurion, LLC (6)	3/3/2021	8.50	%	L+7.50	Commercial Services & Supplies	1,000		987		997
Camp International Holding Company	11/29/2019	8.25	%	L+7.25	Transportation Infrastructure	1,000		1,000		1,005
Checkout Holding Corp. (6)	4/11/2022	7.75	%	L+6.75	Media	1,000		1,003		933
Connolly, LLC (6)	5/13/2022	8.00	%	L+7.00	Professional Services	1,250		1,238		1,241
Del Monte Foods, Inc. (3), (6)	8/18/2021	8.25	%	L+7.25	Food Products	1,500		1,499		1,290
Drew Marine Group Inc.	5/19/2021	8.00	%	L+7.00	Chemicals	1,000		998		995
EWT Holdings III Corp.	1/15/2022	8.50	%	L+7.50	Machinery	1,000		995		975
Filtration Group Corporation (6)	11/22/2021	8.25	%	L+7.25	Industrial Conglomerates	500		496		501
Ikaria, Inc. (6)	2/14/2022	8.75	%	L+7.75	Health Care Providers & Services	1,000		1,012		987
Inmar, Inc. (6)	1/27/2022	8.00	%	L+7.00	Commercial Services & Supplies	750		743		734
Jazz Acquisition, Inc. (6)	6/19/2022	7.75	%	L+6.75	Aerospace & Defense	1,250		1,256		1,223
Jonah Energy LLC (6)	5/12/2021	7.50	%	L+6.50	Oil, Gas & Consumable Fuels	500		493		432
Landslide Holdings, Inc.	2/25/2021	8.25	%	L+7.25	Software	1,000		993		975
P2 Lower Acquisition, LLC	10/22/2021	9.50	%	L+8.50	Health Care Providers & Services	500		498		485
Performance Food Group, Inc. (6)	11/14/2019	6.25	%	L+5.25	Food & Staples Retailing	2,963		2,947		2,914
Prescrix, Inc. (3), (6)	5/2/2022	8.00	%	L+7.00	Containers & Packaging	1,333		1,321		1,325
Ranpak Corp. (6)	10/3/2022	8.25	%	L+7.25	Containers & Packaging	1,375		1,374		1,374
Road Infrastructure Investment, LLC (6)	9/30/2021	7.75	%	L+6.75	Chemicals	2,000		2,009		1,813
Sedgwick Claims Management Services, Inc. (6)	2/28/2022	6.75	%	L+5.75	Insurance	2,000		1,991		1,895

F-37

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2014

(in thousands)

Description	Maturity	Interest Rate (1)		Basis  Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
Second Lien Floating Rate Loans (continued) — 20.7% of net assets
Solenis International, L.P. (6)	7/31/2022	7.75	%	L+6.75	Chemicals	$	500	$	498	$	487
TWCC Holding Corp. (6)	6/26/2020	7.00	%	L+6.00	Media	2,000		1,991		1,923
Tyche Holdings, LLC (6)	11/11/2022	9.00	%	L+8.00	IT Services	500		495		495
WP CPP Holdings, LLC (6)	4/30/2021	8.75	%	L+7.75	Aerospace & Defense	1,000		1,022		955
Total Second Lien Floating Rate Loans						$	30,921	$	30,842	$	29,841
CLO Equity — 35.7% of net assets
Apidos CLO XIV, Income Notes (3), (4)	4/15/2025					$	5,900	$	5,299	$	5,337
Ares XXIX CLO Ltd., Subordinated Notes (3), (4)	4/17/2026					4,750		4,339		4,239
Avery Point II CLO, Limited, Income Notes (3), (4)	7/17/2025					3,200		2,764		2,697
Blue Hill CLO, Ltd., Subordinated Notes (3), (4)	1/15/2026					5,400		4,709		4,588
Blue Hill CLO, Ltd., Subordinated Fee Notes (3), (4)	1/15/2026					100		94		91
Carlyle Global Market Strategies CLO 2013-3, Ltd., Subordinated Notes (3), (4)	7/15/2025					2,750		2,096		2,311
Cent CLO 18 Limited, Subordinated Notes (3), (4)	7/23/2025					4,675		4,007		3,940
Cent CLO 19 Limited, Subordinated Notes (3), (4)	10/29/2025					2,750		2,402		2,299
Dryden 31 Senior Loan Fund, Subordinated Notes (3), (4)	4/18/2026					5,250		4,686		4,187
Galaxy XVI CLO, Ltd., Subordinated Notes (3), (4)	11/17/2025					2,750		2,362		2,259
Halcyon Loan Advisors Funding 2014-1 Ltd., Subordinated Notes (3), (4)	4/18/2026					3,750		3,315		3,376
Highbridge Loan Management 2013-2, Ltd., Subordinated Notes (3), (4)	10/20/2024					1,000		849		838
Magnetite VIII, Limited, Subordinated Notes (3), (4)	4/15/2026					3,000		2,911		2,680
Neuberger Berman CLO XV, Ltd., Subordinated Notes (3), (4)	10/15/2025					3,410		2,786		2,773
Octagon Investment Partners XIV, Ltd., Income Notes (3), (4)	1/15/2024					5,500		4,571		4,210
Octagon Investment Partners XX, Ltd., Subordinated Notes (3), (4)	8/12/2026					2,500		2,482		2,327
THL Credit Wind River 2014-1 CLO Ltd., Subordinated Notes (3), (4)	4/18/2026					4,000		3,591		3,425
Total CLO Equity						$	60,685	$	53,263	$	51,577
Total Non-Control/Non-Affiliate Investments — 191.6% of net assets						$	289,827	$	282,133	$	276,370
Liabilities in Excess of Other Assets — (91.6%)										(132,135		)
Net Assets — 100.0%										$	144,235

(1) Floating rate debt investments typically bear interest at a rate determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) index rate or the prime index rate (“PRIME” or “P”), and which typically reset monthly, quarterly or semi-annually. For each debt investment we have provided the current interest rate in effect as of December 31, 2014.

(2) Floating rate instruments accrue interest at a predetermined spread relative to an index, typically the LIBOR or PRIME rate. These instruments are typically subject to a LIBOR or PRIME rate floor.

(3) Investments that are not “qualifying assets” under Section 55(a) of the 1940 Act. Under the 1940 Act, we may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of our total assets.

(4) These securities are exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions that are exempt from registration, normally to qualified institutional buyers.

(5) All or a portion of this position has not settled as of December 31, 2014.

(6) Assets are held at ACSF Funding and are pledged as collateral for the Credit Facility.

F-38

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2013

(in thousands)

Description	Maturity	Interest Rate (1)		Basis Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
Non-Control/Non-Affiliate Investments
First Lien Floating Rate Loans
Akorn, Inc. (3), (5), (6)	11/13/2020	4.50	%	L+3.50	Pharmaceuticals	$	2,500	$	2,488	$	2,517
American Renal Holdings, Inc.	8/20/2019	4.50	%	L+3.25	Health Care Providers & Services	2,992		2,963		3,006
AmWINS Group, LLC	9/6/2019	5.00	%	L+3.75	Insurance	998		996		1,006
Aquilex, LLC (5)	12/18/2020	5.00	%	L+4.00	Commercial Services & Supplies	2,000		1,995		2,010
ARG IH Corporation	11/15/2020	5.00	%	L+4.00	Hotels, Restaurants & Leisure	2,000		2,006		2,014
Ascensus, Inc.	12/2/2019	5.00	%	L+4.00	Commercial Services & Supplies	1,000		995		1,009
Aspen Dental Management, Inc.	10/6/2016	7.00	%	L+5.50	Health Care Providers & Services	997		988		990
BJ’s Wholesale Club, Inc.	9/26/2019	4.50	%	L+3.50	Food & Staples Retailing	1,000		995		1,007
Blackboard Inc.	10/4/2018	4.75	%	L+3.75	Software	4,000		3,995		4,061
Blue Coat Systems, Inc.	5/31/2019	4.50	%	L+3.50	Software	3,072		3,091		3,087
BMC Software Finance, Inc.	9/10/2020	5.00	%	L+4.00	Software	3,000		3,022		3,021
Calceus Acquisition, Inc.	1/31/2020	5.00	%	L+4.00	Textiles, Apparel & Luxury Goods	2,993		3,007		3,014
Catalina Marketing Corporation	10/12/2020	5.25	%	L+4.25	Media	2,494		2,494		2,532
Centerplate, Inc.	11/26/2019	4.75	%	L+3.75	Hotels, Restaurants & Leisure	2,000		1,990		2,014
Chromaflo Technologies Corporation (Chromaflo Technologies Finance B.V.) (3)	12/2/2019	4.50	%	L+3.50	Chemicals	2,000		1,995		2,004
CityCenter Holdings, LLC	10/16/2020	5.00	%	L+4.00	Hotels, Restaurants & Leisure	2,000		2,015		2,033
CPG International, LLC	9/30/2020	4.75	%	L+3.75	Building Products	2,993		2,985		3,013
CT Technologies Intermediate Holdings, Inc.	10/4/2019	5.25	%	L+4.00	Health Care Technology	2,500		2,512		2,519
Deltek, Inc.	10/10/2018	5.00	%	L+3.75	Software	2,992		3,003		3,009
Dialysis Newco, Inc.	8/16/2020	5.25	%	L+4.25	Health Care Providers & Services	1,995		1,997		2,000
Dole Food Company, Inc.	11/1/2018	4.50	%	L+3.50	Food Products	3,250		3,234		3,268
Drew Marine Group, Inc. (5)	11/19/2020	4.50	%	L+3.50	Chemicals	2,000		2,004		2,010
Duff & Phelps Corporation	4/23/2020	4.50	%	L+3.50	Capital Markets	3,491		3,494		3,496
Emerald Exposition Holding, Inc.	6/17/2020	5.50	%	L+4.25	Media	2,992		3,022		3,007
Fairmount Minerals, Ltd. (5)	9/5/2019	5.00	%	L+4.00	Metals & Mining	2,993		3,011		3,045
Filtration Group Corporation	11/20/2020	4.50	%	L+3.50	Industrial Conglomerates	1,250		1,244		1,265
First Data Corporation	3/23/2018	4.16	%	L+4.00	IT Services	2,000		2,007		2,007
GENEX Services, Inc.	7/26/2018	5.25	%	L+4.25	Insurance	2,115		2,136		2,136
Global Tel*Link Corporation	5/22/2020	5.00	%	L+3.75	Diversified Telecommunication Services	1,995		1,956		1,954

F-39

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2013

(in thousands)

Description	Maturity	Interest Rate (1)		Basis Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued)
Great Wolf Resorts, Inc.	8/6/2020	4.50	%	L+3.50	Hotels, Restaurants & Leisure	$	2,992	$	3,000	$	3,013
Greeneden U.S. Holdings II, LLC (7)	11/13/2020	4.50	%	L+3.50	Software	667		657		674
HGIM Corp.	6/18/2020	5.50	%	L+4.50	Marine	1,496		1,502		1,512
Information Resources, Inc.	9/30/2020	4.75	%	L+3.75	Professional Services	1,995		2,010		2,009
Intrawest Operations Group, LLC (5)	12/9/2020	5.50	%	L+4.50	Hotels, Restaurants & Leisure	2,200		2,182		2,227
Metaldyne, LLC	12/18/2018	5.00	%	L+3.75	Auto Components	1,995		1,995		2,021
Mitchell International, Inc.	10/12/2020	4.50	%	L+3.50	IT Services	2,000		2,005		2,016
Murray Energy Corporation	12/5/2019	5.25	%	L+4.25	Oil, Gas & Consumable Fuels	3,000		2,985		3,036
The Neiman Marcus Group LTD, Inc.	10/25/2020	5.00	%	L+4.00	Multiline Retail	3,000		3,003		3,042
North American Lifting Holdings, Inc.	11/27/2020	5.50	%	L+4.50	Commercial Services & Supplies	2,000		1,960		1,990
Opal Acquisition, Inc. (5)	11/27/2020	5.00	%	L+4.00	Health Care Providers & Services	3,000		2,975		3,007
Oxbow Carbon, LLC	7/19/2019	4.25	%	L+3.25	Metals & Mining	987		995		994
P2 Lower Acquisition, LLC	10/22/2020	5.50	%	L+4.50	Health Care Providers & Services	2,423		2,414		2,436
Party City Holdings, Inc.	7/27/2019	4.25	%	L+3.25	Specialty Retail	2,992		3,004		3,010
PRA Holdings, Inc.	9/23/2020	5.00	%	L+4.00	Life Sciences Tools & Services	1,995		1,995		2,004
Quikrete Holdings, Inc.	9/26/2020	4.00	%	L+3.00	Construction Materials	2,993		3,007		3,011
Ranpak Corp.	4/23/2019	4.50	%	L+3.25	Containers & Packaging	1,957		1,966		1,979
Raven Power Finance, LLC	12/19/2020	5.25	%	L+4.25	Independent Power & Renewable Electricity Producers	2,000		1,980		2,005
Renaissance Learning, Inc.	11/16/2020	5.00	%	L+4.00	Software	3,990		3,951		4,020
RGIS Services, LLC	10/18/2017	5.50	%	L+4.25	Commercial Services & Supplies	2,992		2,974		2,961
Sabre, Inc.	2/19/2019	5.25	%	L+4.00	Software	1,995		2,017		2,013
Securus Technologies Holdings, Inc.	4/30/2020	4.75	%	L+3.50	Diversified Telecommunication Services	1,924		1,893		1,907
Spin Holdco Inc. (5), (6)	11/14/2019	4.25	%	L+3.25	Diversified Consumer Services	3,000		3,001		3,026
Station Casinos LLC (5)	3/2/2020	5.00	%	L+4.00	Hotels, Restaurants & Leisure	2,992		3,019		3,030
TMS International Corp.	10/16/2020	4.50	%	L+3.50	Metals & Mining	3,000		3,007		3,029
TransFirst Holdings, Inc.	12/27/2017	5.75	%	L+3.50	IT Services	2,835		2,849		2,844
TriNet HR Corporation	8/20/2020	5.00	%	L+4.00	Professional Services	1,995		1,985		2,015
Turbocombustor Technology, Inc.	12/2/2020	5.50	%	L+4.50	Aerospace & Defense	3,500		3,465		3,491
USI, Inc.	12/27/2019	4.25	%	L+3.25	Insurance	1,995		2,015		2,007
USIC Holdings, Inc.	7/10/2020	4.75	%	L+3.75	Construction & Engineering	2,993		3,007		3,015
Vitera Healthcare Solutions, LLC	11/4/2020	6.00	%	L+5.00	Health Care Technology	2,250		2,232		2,250
WASH MultiFamily Laundry Systems, LLC	2/21/2019	4.50	%	L+3.50	Diversified Consumer Services	3,491		3,494		3,500

F-40

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2013

(in thousands)

Description	Maturity	Interest Rate (1)		Basis Point Spread Above Index (2)	Industry	Par Amount		Cost		Fair Value
First Lien Floating Rate Loans (continued)
World Kitchen, LLC	3/4/2019	5.50	%	L+4.25	Household Durables	$	2,992	$	2,977	$	3,030
WP CPP Holdings, LLC	12/28/2019	4.75	%	L+3.75	Aerospace & Defense	2,992		2,985		3,022
WTG Holdings III Corp. (5), (6)	1/15/2021	4.75	%	L+3.75	Machinery	1,000		995		1,007
Total First Lien Floating Rate Loans						$	153,240	$	153,141	$	154,207
Second Lien Floating Rate Loans
Ameriforge Group, Inc. (5)	12/21/2020	8.75	%	L+7.50	Energy Equipment & Services	$	500	$	500	$	511
BJ’s Wholesale Club, Inc.	3/26/2020	8.50	%	L+7.50	Food & Staples Retailing	2,000		1,990		2,045
Camp International Holding Company	11/29/2019	8.25	%	L+7.25	Transportation Infrastructure	1,000		1,000		1,022
Chromaflo Technologies Corporation (Chromaflo Technologies Finance B.V.) (3)	6/2/2020	8.25	%	L+7.25	Chemicals	1,000		995		1,010
Del Monte Foods, Inc. (3), (5), (6)	7/26/2021	8.25	%	L+7.25	Food Products	1,000		990		1,012
Drew Marine Group, Inc.	5/19/2021	8.00	%	L+7.00	Chemicals	2,000		1,995		2,015
Filtration Group Corporation	11/22/2021	8.25	%	L+7.25	Industrial Conglomerates	500		495		512
Performance Food Group, Inc.	11/14/2019	6.25	%	L+5.25	Food & Staples Retailing	2,993		2,974		3,015
Sheridan Holdings, Inc.	12/20/2021	8.25	%	L+7.25	Health Care Providers & Services	2,000		1,990		2,019
WP CPP Holdings, LLC (5)	4/30/2021	8.75	%	L+7.75	Aerospace & Defense	1,000		1,025		1,020
WTG Holdings III Corp. (5), (6)	1/15/2022	8.50	%	L+7.50	Machinery	1,000		995		1,005
Total Second Lien Floating Rate Loans						$	14,993	$	14,949	$	15,186
CLO Equity
Apidos CLO XIV, Income Notes (3), (4)	4/15/2025					$	4,400	$	4,440	$	4,442
Blue Hill CLO, Ltd., Subordinated Notes (3), (4)	1/15/2026					5,400		4,854		4,930
Blue Hill CLO, Ltd. Subordinated Fee Notes (3), (4)	1/15/2026					100		108		110
Cent CLO 18 Limited, Subordinated Notes (3), (4)	7/23/2025					4,675		4,675		4,709
Cent CLO 19 Limited, Subordinated Notes (3), (4)	10/29/2025					2,750		2,524		2,476
Carlyle Global Market Strategies CLO 2013-3, Subordinated Notes (3),(4)	7/15/2025					2,750		2,699		2,839
Galaxy XVI CLO, Ltd., Subordinated Notes (3), (4)	11/17/2025					2,750		2,511		2,466
Neuberger Berman CLO XV, Ltd., Subordinated Notes (3), (4)	10/15/2025					3,410		3,112		3,047
Octagon Investment Partners XIV, Ltd., Income Notes (3), (4)	1/15/2024					5,500		5,255		5,153
Total CLO Equity						$	31,735	$	30,178	$	30,172
Total Non-Control/Non-Affiliate Investments						$	199,968	$	198,268	$	199,565
Liabilities in Excess of Other Assets										(198,549		)
Net Assets										$	1,016

F-41

AMERICAN CAPITAL SENIOR FLOATING, LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2013

(in thousands)

(1) Floating rate debt investments typically bear interest at a rate determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) index rate or the prime index rate (“PRIME” or “P”), and which typically reset monthly, quarterly or semi-annually. For each debt investment we have provided the current interest rate in effect as of December 31, 2013.

(2) Floating rate instruments accrue interest at a predetermined spread relative to an index, typically the LIBOR or PRIME rate. These instruments are typically subject to a LIBOR or PRIME rate floor.

(3) Investments that are not “qualifying assets” under Section 55(a) of the 1940 Act. Under the 1940 Act, we may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of our total assets.

(4) These securities are exempt from registration under Rule 144A of the Securities Act of 1933, as amended. These securities may be resold in transactions that are exempt from registration, normally to qualified institutional buyers.

(5) All or a portion of this position has not settled as of December 31, 2013.

(6) Denotes a “when issued” security that was scheduled to close after December 31, 2013. 

(7) Includes the unfunded obligations of $1,333 par at $5 fair value.

F-42

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

Note 1. Organization

American Capital Senior Floating, Ltd. (which is referred to as “ACSF”, “we”, “us” and “our”) was organized in February 2013 as a Maryland corporation and commenced operations on October 15, 2013. We are structured as an externally managed, non-diversified closed-end investment management company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). On November 14, 2013, we formed a wholly-owned special purpose financing vehicle, ACSF Funding I, LLC, a Delaware limited liability company (“ACSF Funding”).

In January 2014, we completed an initial public offering (“IPO”) of 10,000,000 shares of common stock at the public offering price of $15.00 per share for gross proceeds of $150,000. Upon completion of the IPO, we became externally managed by American Capital ACSF Management, LLC (our “Manager”), an indirect subsidiary of American Capital Asset Management, LLC (“ACAM”), which is a wholly-owned portfolio company of American Capital, Ltd. (“American Capital”). Prior to the completion of our IPO, we were wholly-owned by ACAM. Following completion of the IPO, ACAM owned approximately 3% of our outstanding common stock, the maximum amount permissible under the 1940 Act. In conjunction with the IPO, our Manager paid the underwriting commissions of $7,952. Our common stock is listed on the NASDAQ Global Select Market, where it trades under the symbol “ACSF”. In connection with the IPO, we elected to be treated as a BDC under the 1940 Act and intend to elect to be taxed as a regulated investment company (“RIC”), as defined in Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”).

Investment Objective

Our investment objective is to provide attractive, risk-adjusted returns over the long term primarily through current income while seeking to preserve our capital. We actively manage a leveraged portfolio composed primarily of diversified investments in first lien and second lien floating rate loans principally to large-market U.S.-based companies (collectively, “Senior Secured Floating Rate Loans” or “Loans”) which are commonly referred to as leveraged loans. We also invest in equity tranches of collateralized loan obligations (“CLOs”) which are securitized vehicles collateralized primarily by Loans and we may invest in debt tranches of CLOs. In addition, we may selectively invest in loans issued by middle market companies, mezzanine and unitranche loans and high yield bonds. Additionally, we may from time to time hold or invest in other equity investments and other debt or equity securities generally arising from a restructuring of Loan positions previously held by us.

Note 2. Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). Subsequent events are evaluated and disclosed as appropriate for events occurring through the date the consolidated financial statements are issued.

The consolidated financial statements include our accounts and those of our wholly-owned subsidiary, ACSF Funding. Intercompany accounts and transactions have been eliminated in consolidation. The accounts of ACSF Funding are prepared for the same reporting period as ours using consistent accounting policies.

Use of Estimates

The preparation of our financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amount of income and expenses during the reported period. Changes in economic environment, financial markets, and any other parameters used in determining such estimates could cause actual results to differ.

Investment Classification

As required by the 1940 Act, investments are classified by level of control. "Control Investments" are defined as investments in portfolio companies that we are deemed to control, as defined in the 1940 Act. "Affiliate Investments" are investments in those companies that are affiliated companies, as defined in the 1940 Act, other than Control Investments. "Non-Control/Non-Affiliate Investments" are those that are neither Control Investments nor Affiliate Investments.

F-43

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

Generally, under the 1940 Act, we are deemed to control a company in which we have invested if we own more than 25% of the voting securities of such company. We are deemed to be an affiliate of a company if we own 5% or more of the voting securities of such company.

As of December 31, 2014 and 2013, all of our investments were Non-Control/Non-Affiliate investments.

Fair Value Measurements

We value our investments in accordance with the 1940 Act and Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurements and Disclosures (“ASC 820”), as determined in good faith by our Board of Directors. Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Due to the uncertainty inherent in the valuation process, estimates of fair value may differ significantly from the values that would have been used had a ready market for our investments existed, and the differences could be material. Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on the investments to be different than the valuations currently assigned.

We undertake a multi-step valuation process to determine the fair value of our investments in accordance with ASC 820. The valuation process begins with the development of a preliminary valuation recommendation for each investment as determined in accordance with our valuation policy by a group of our Manager’s valuation, accounting and finance professionals, which is independent of our Manager’s investment team. To prepare the proposed valuation, the group reviews information provided by a nationally recognized independent pricing service and broker-dealers, and may consult with the investment team and other internal resources of our Manager and its affiliates. The preliminary valuation recommendations are then presented to the Investment Committee and reviewed and approved by our Audit and Compliance Committee. The valuation recommendations are then reviewed by our Board of Directors for final approval. There were no changes to our valuation techniques or to the types of unobservable inputs used in the valuation process during the year ended December 31, 2014 compared to the period ended December 31, 2013.

Securities Transactions

Securities transactions are recorded on the trade date. The trade date for loans purchased in the "primary market" is considered the date on which the loan allocations are determined. The trade date for loans and other investments purchased in the "secondary market" is the date on which the transaction is entered into. The trade date for primary CLO equity transactions and any other security transaction entered outside conventional channels is the date we have determined all material terms have been defined for the transaction and have obtained a right to demand the securities purchased or collect the proceeds of a sale and incur an obligation to pay the price of the securities purchased or to deliver the securities sold, respectively. Cost is determined based on consideration given, and the unrealized appreciation or depreciation on investment securities represent the changes in fair values as determined in compliance with the valuation policy. Realized gains and losses from the disposition of securities are recorded on the basis of weighted average cost.

Investment Income

For debt investments, we record interest income on the accrual basis to the extent that such amounts are expected to be collected. OID and purchased discounts and premiums are accreted/amortized into interest income using the effective interest method, where applicable. Loan origination fees are deferred and accreted into interest income using the effective interest method. We record prepayment premiums on loans and other investments as interest income when such amounts are received. We stop accruing interest on investments when it is determined that interest is no longer collectible. As of December 31, 2014 and 2013, we had no loans on non-accrual status.

Interest income on the CLO equity investments is recognized using the effective interest method as required by ASC Subtopic 325-40, Investments-Other, Beneficial Interests in Securitized Financial Assets. At the time of purchase, we estimate the future expected cash flows and determine the effective interest rate based on these estimated cash flows and our cost basis. Subsequent to the purchase, the estimated future cash flows are updated quarterly and a revised yield is calculated prospectively based on the current amortized cost of the investment as adjusted for credit impairments, if any.

Cash and Cash Equivalents

Cash and cash equivalents consist of demand deposits and highly liquid financial instruments with original maturities of 90 days or less including those held in overnight sweep bank deposit accounts. Cash and cash equivalents are carried at cost, which approximates fair value. We place our cash and cash equivalents with financial institutions and, at times, cash held in bank accounts may exceed the Federal Deposit Insurance Corporation insured limit.

F-44

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

Consolidation

As permitted under Regulation S-X and as explained by ASC 946-810-45, Financial Services - Investment Companies - Consolidation, we will generally not consolidate an investment in a company other than an investment company subsidiary or a controlled operating company whose business consists primarily of providing services to us. Accordingly, we have consolidated the results of ACSF Funding in our consolidated financial statements.

Offering Costs

Offering costs consist of fees and expenses incurred in connection with our IPO of common stock including legal, accounting and printing fees, but exclusive of underwriting commissions, which were paid by our Manager. There were $844 and $0 of offering costs charged to capital during the year and period ended December 31, 2014 and 2013, respectively.

Dividends to Common Stockholders

Dividends and distributions to common stockholders are recorded on the ex-dividend date.

Note 3. Agreements

Management Agreement

We have entered into a management agreement with our Manager effective January 15, 2014. Under the management agreement, our Manager has agreed to provide investment advisory services to us, in addition to providing personnel, facilities and additional services necessary for our operations. Unless terminated earlier, the management agreement will remain in effect until January 15, 2016. It will remain in effect from year-to-year thereafter if approved annually by our Board of Directors or by the affirmative vote of the holders of a majority of our outstanding voting securities, and, in either case if also approved by a majority of our directors who are not “Interested Persons” as defined under the 1940 Act.

Our Manager receives a management fee from us that is payable quarterly in arrears. The management fee is calculated at an annual rate of 0.80% of our total consolidated assets, excluding cash and cash equivalents and net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. There is no incentive compensation paid to our Manager under the management agreement. The management fee is prorated for any partial period and totaled $2,186 and $0 for the year and period ended December 31, 2014 and 2013, respectively.

Since our Manager has no employees, it has entered into an administrative agreement with both its parent and American Capital pursuant to which our Manager will be provided with personnel, services and resources necessary for our Manager to perform its obligations under the management agreement.

We have also agreed to reimburse our Manager and its affiliates for certain expenses related to operations incurred on our behalf, excluding employment-related expenses of our and our Manager’s officers and any employees of American Capital or its affiliates who provide services to us pursuant to the management agreement or to our Manager pursuant to the administrative services agreement. In addition, our Manager or one of its affiliates may pay for or incur certain expenses and then allocate these expenses to ACSF. For the year and period ended December 31, 2014 and 2013, we recognized $970 and $48, respectively, of expenses that are reimbursable to our Manager and its affiliates.

For 24 months following the date of our IPO, our Manager has agreed to be responsible for certain of our operating expenses in excess of 0.75% of our consolidated net assets, less net unrealized appreciation or depreciation, each as determined under GAAP at the end of the most recently completed fiscal quarter. Operating expenses subject to this reimbursement include both (i) our operating expenses reimbursed to our Manager and its affiliates for the expenses related to our operations incurred on our behalf and (ii) our operating expenses directly incurred by us excluding the management fee, interest costs, taxes and accrued costs and fees related to actual, pending or threatened litigation, each as determined under GAAP for the most recently completed fiscal quarter. As a result of this operating expense limit, any reimbursements to our Manager and its affiliates could be reduced or eliminated, and in certain instances, our Manager could be required to reimburse us so that our other expenses do not exceed the limit described above. Subsequent to the first full 24 months after the date of our IPO, there are no limits on the reimbursement to our Manager or its affiliates of such expenses related to our operations. For the year and period ended December 31, 2014 and 2013, our Manager was responsible for $1,001 and $0, respectively, of operating expenses as a result of the expense cap.

F-45

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

Tax Sharing Agreement

For the period prior to our IPO, during which we were treated as a taxable corporation under Subchapter C of the Code ("C corporation") for tax purposes, we had a tax sharing agreement with American Capital and other members of its consolidated tax group, under which such members bore their full share of their individual tax obligation and members were compensated for their losses and other tax benefits that were able to be used by other members of the consolidated tax group based on their pro-forma stand-alone federal income tax return.     

Note 4. Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share for the year ended December 31, 2014:

	Year Ended
	December 31, 2014
Numerator—net increase in net assets resulting from operations	$	3,789
Denominator—weighted average shares (1)	10,000,100
Earnings per share	$	0.38

(1) Assumes the 10,000,000 common shares issued in our IPO on January 22, 2014 were issued on January 1, 2014.

Earnings per share for the period ended December 31, 2013 is considered not meaningful.

Note 5. Investments

Our investments primarily focus on Senior Secured Floating Rate Loans and investments in equity tranches of CLOs. Our investments in Senior Secured Floating Rate Loans are typically arranged by a syndicate of investment or commercial banks who syndicate loans to third-party investors. Investors may seek to buy and sell Senior Secured Floating Rate Loans through both primary and secondary markets. During the year ended December 31, 2014, we purchased Senior Secured Floating Rate Loans of 102 new and 18 existing portfolio companies for a total purchase price of $199,931. During the period ended December 31, 2013, we purchased Senior Secured Floating Rate Loans of 72 portfolio companies for a total purchase price of $177,886. During the year ended December 31, 2014, we purchased eight new and one existing CLO equity investments for an aggregate purchase price of $26,697. During the period ended December 31, 2013, we purchased eight new CLO equity investments for an aggregate purchase price of $29,662. Proceeds from the exit of investments during the year and period ended December 31, 2014 and 2013 totaled $148,461 and $9,790, respectively. As of December 31, 2014, our portfolio consisted of 133 portfolio companies, including 117 Loan obligors and 16 CLO equity investments. As of December 31, 2013, our portfolio consisted of 77 portfolio companies, including 69 Loan obligors and eight CLO equity investments.

We may, from time to time, transact in purchases or sales of securities with affiliates of our Manager at fair market value on the trade date. During the year ended December 31, 2014 and the period ended December 31, 2013, total proceeds from sales to affiliates were $20,521 and $0, respectively. During the period ended December 31, 2013, we purchased seven CLO equity investments from ACAM at fair value for an aggregate purchase price of $24,748. These transactions meet ASC 860, Transfers and Servicing, requirements for sale accounting treatment.

F-46

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

We use the Global Industry Classification Standard (“GICS®”) to classify the industry groupings of our Loan investments. The GICS® was developed by MSCI, an independent provider of global indexes and benchmark-related products and services, and Standard & Poor’s, an independent international financial data and investment services company and provider of global equity indexes. The following table shows the Loan portfolio composition by industry grouping at fair value as a percentage of total Loans as of December 31, 2014 and 2013. Our investments in CLO equity are excluded from the table.

	December 31, 2014	December 31, 2013
Health Care Providers & Services	9.9%	7.9%
Media	7.7%	3.3%
Software	7.4%	11.7%
Aerospace & Defense	7.4%	4.4%
Hotels, Restaurants & Leisure	6.7%	8.4%
Commercial Services & Supplies	5.0%	4.7%
Insurance	4.1%	3.0%
Health Care Equipment & Supplies	3.3%	—%
Containers & Packaging	2.9%	1.2%
Oil, Gas & Consumable Fuels	2.8%	1.8%
Metals & Mining	2.5%	4.2%
Life Science Tools & Services	2.5%	1.2%
Professional Services	2.5%	2.4%
Food & Staples Retailing	2.4%	3.6%
Machinery	2.3%	1.2%
Independent Power and Renewable Electricity Producers	2.2%	1.2%
Food Products	2.2%	2.5%
Diversified Consumer Services	2.0%	3.8%
Multiline Retail	1.9%	1.8%
Textiles, Apparel & Luxury Goods	1.8%	1.8%
Chemicals	1.8%	4.1%
Diversified Telecommunication Services	1.6%	2.3%
Capital Markets	1.5%	2.1%
Transportation Infrastructure	1.3%	0.6%
Trading Companies & Distributors	1.3%	—%
Building Products	1.3%	1.8%
Internet & Catalog Retail	1.3%	—%
Construction Materials	1.3%	1.8%
Health Care Technology	1.0%	2.8%
Pharmaceuticals	1.0%	1.5%
IT Services	1.0%	4.0%
Construction & Engineering	0.6%	1.8%
Household Durables	—%	1.8%
Specialty Retail	—%	1.8%
Other	5.5%	3.5%
Total	100.0%	100.0%

F-47

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

We have invested in portfolio companies located primarily in the United States and CLO equity domiciled in the Cayman Islands. The geographic distribution for our portfolio companies is determined by the location of the corporate headquarters, which may not be indicative of the primary location for the portfolio company's operations.

The following table shows the portfolio composition by geographic region at cost and fair value of total investments as of December 31, 2014:

		Cost	% Cost	Fair Value	% Fair Value
United States
	Southeast	$66,706	23.6%	$65,434	23.7%
	Mid-Atlantic	44,130	15.6%	43,761	15.8%
	Midwest	45,378	16.1%	44,523	16.1%
	West	38,520	13.7%	37,693	13.6%
	Southwest	14,082	5.0%	13,811	5.0%
	Northeast	13,306	4.7%	13,122	4.8%
Cayman Islands		53,263	18.9%	51,577	18.7%
International (1)		6,748	2.4%	6,449	2.3%
	Total	$282,133	100.0%	$276,370	100.0%

(1) International region is comprised of Australia, United Kingdom, and Luxembourg

The following table shows the portfolio composition by geographic region at cost and fair value of total investments as of December 31, 2013:

		Cost	% Cost	Fair Value	% Fair Value
United States
	Southeast	$39,116	19.7%	$39,352	19.7%
	Mid-Atlantic	40,412	20.4%	40,699	20.4%
	Midwest	35,094	17.7%	35,437	17.8%
	West	29,704	15.0%	29,913	15.0%
	Southwest	14,808	7.5%	14,921	7.5%
	Northeast	8,956	4.5%	9,071	4.5%
Cayman Islands		30,178	15.2%	30,172	15.1%
	Total	$198,268	100.0%	$199,565	100.0%

F-48

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

Note 6. Fair Value Measurements

We value our investments at fair value in accordance with ASC 820, which defines fair value as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Due to the uncertainty inherent in the valuation process, estimates of fair value may differ significantly from the values that would have been used had a ready market for our investments existed, and the differences could be material. Additionally, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on the investments to be different than the valuations currently assigned.

ASC 820 provides a framework for measuring the fair value of assets and liabilities and provides guidance regarding a fair value hierarchy, which prioritizes information used to measure fair value and the effect of fair value measurements on earnings. When available, we determine the fair value of our investments using unadjusted quoted prices from active markets. Where inputs for an asset or liability fall into more than one level in the fair value hierarchy, the investment is classified in its entirety based on the lowest level input that is significant to that investment’s fair value measurement. We use judgment and consider factors specific to the investment when determining the significance of an input to a fair value measurement. Our policy is to recognize transfers in and out of levels as of the beginning of each reporting period. The three levels of the fair value hierarchy and investments that fall into each of the levels are described below:

Level 1: Inputs are unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. This may include valuations based on executed trades, broker quotations that constitute an executable price, and alternative pricing sources supported by observable inputs which, in each case, are either directly or indirectly observable for the asset in connection with market data at the measurement date.

Level 3: Inputs are unobservable and cannot be corroborated by observable market data. In certain cases, investments classified within Level 3 may include securities for which we have obtained indicative quotes from broker-dealers that do not necessarily represent prices the broker may be willing to trade on.

The valuation techniques used maximize the use of observable inputs and minimize the use of unobservable inputs. Our Loans are predominately valued based on evaluated prices from a nationally recognized independent pricing service approved by our Board of Directors or from third-party brokers who make markets in such debt investments. When possible, we make inquiries of third-party pricing sources to understand their use of significant inputs and assumptions. We review the third-party fair value estimates and perform procedures to validate their reasonableness, including an analysis of the range and dispersion of third-party estimates, frequency of pricing updates, comparison of recent trade activity for similar securities, and review for consistency with market conditions observed as of the measurement date.

There may be instances when independent or third-party pricing sources are not available, or cases where we believe that the third-party pricing sources do not provide sufficient evidence to support a market participant’s view of the fair value of the debt investment being valued. These instances may result from an investment in a less liquid loan such as a middle market loan, a mezzanine loan or unitranche loan, or a loan to a company that has become financially distressed. In these instances, we may estimate the fair value based on a combination of a market yield valuation methodology and evaluated pricing discussed above, or solely based on a market yield valuation methodology. Under the market yield valuation methodology, we estimate the fair value based on a discounted cash flow technique. For these debt investments, the unobservable inputs used in the market yield valuation methodology to measure fair value reflect management’s best estimate of assumptions that would be used by market participants when pricing the investment in a hypothetical transaction, including estimated remaining life, current market yield and interest rate spreads of similar loans and securities as of the measurement date. We will estimate the remaining life based on market data for the average life of similar loans. However, if we have information that the loan is expected to be repaid in the near term, we would use an estimated remaining life based on the expected repayment date. The average life to be used to estimate the fair value of our loans may be shorter than the legal maturity of the loans since many loans are prepaid prior to the maturity date. The interest rate spreads used to estimate the fair value of our loans is based on current interest rate spreads of similar loans. If there is a significant deterioration of the credit quality of a loan, we may consider other factors that a hypothetical market participant would use to estimate fair value, including the proceeds that would be received in a liquidation analysis.

We estimate the fair value of our CLO equity investments using a combination of third-party broker quotes, purchases or sales of the same or similar securities, and cash flow forecasts subject to assumptions that a market participant would use regarding the investments’ underlying collateral including, but not limited to, assumptions for default and recovery rates,

F-49

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

reinvestment spreads and prepayment rates. Cash flow forecasts are discounted using market participant’s market yield assumptions that are derived from multiple sources including, but not limited to, third-party broker quotes, industry research reports and transactions of securities and indices with similar structures and risk characteristics. We weight the use of third-party broker quotes, if any, when determining fair value based on our understanding of the level of actual transactions used by the broker to develop the quote and whether the quote was an indicative price or binding offer, the depth and consistency of broker quotes and the correlation of changes in broker quotes with underlying performance and other market indices. For the year ended December 31, 2014, there were no changes to our valuation techniques or to the types of unobservable inputs used in the valuation process compared to the period ended December 31, 2013.

The following fair value hierarchy tables set forth our investments measured at fair value on a recurring basis by level as of December 31, 2014 and 2013:

	December 31, 2014
	Total		Level 1		Level 2		Level 3
First lien floating rate loans	$	194,952	$	—	$	189,274	$	5,678
Second lien floating rate loans	29,841		—		26,601		3,240
CLO equity	51,577		—		—		51,577
Total Investments	$	276,370	$	—	$	215,875	$	60,495

	December 31, 2013
	Total		Level 1		Level 2		Level 3
First lien floating rate loans	$	154,207	$	—	$	117,950	$	36,257
Second lien floating rate loans	15,186		—		11,650		3,536
CLO equity	30,172		—		—		30,172
Total Investments	$	199,565	$	—	$	129,600	$	69,965

The following table provides a summary of the changes in fair value of Level 3 assets for the year ended December 31, 2014 as well as the portion of net unrealized depreciation for the year ended December 31, 2014 related to those assets still held as of December 31, 2014:

	First lien floating rate loans			Second lien floating rate loans			CLO equity			Total
Beginning Balance – December 31, 2013	$	36,257		$	3,536		$	30,172		$	69,965
Purchases	10,247			7,924			26,697			44,868
Sales	(12,538		)	(3,507		)	—			(16,045		)
Repayments (1)	(4,351		)	—			(9,113		)	(13,464		)
Amortization of discount/premium (2)	7			3			5,501			5,511
Transfers out (3)	(34,776		)	(6,531		)	—			(41,307		)
Transfers in (3)	10,951			1,944			—			12,895
Realized gains, net	133			36			—			169
Unrealized depreciation, net	(252		)	(165		)	(1,680		)	(2,097		)
Ending Balance – December 31, 2014	$	5,678		$	3,240		$	51,577		$	60,495
Net change in unrealized depreciation reported within the net change in unrealized depreciation on investments in our consolidated statement of operations attributable to our Level 3 assets still held as of December 31, 2014	$	(229	)	$	(280	)	$	(1,680	)	$	(2,189	)

(1) Includes total cash distributions from CLO equity investments.

(2) Includes income accrual from CLO equity investments.

(3) Investments were transferred into and out of Level 3 and Level 2 due to changes in the quantity and quality of inputs obtained to support the fair value of each investment. Transfers into and out of the levels are recognized at the beginning of the period.    

F-50

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

The following table provides a summary of the changes in fair value of Level 3 assets for the period ended December 31, 2013 as well as the portion of net unrealized appreciation or depreciation for the period ended December 31, 2013 related to those assets still held as of December 31, 2013:

	First lien floating rate loans			Second lien floating rate loans		CLO equity			Total
Beginning Balance – October 15, 2013	$	—		$	—	$	—		$	—
Purchases	39,069			3,490		29,662			72,221
Sales	—			—		—			—
Repayments (1)	(3,151		)	—		—			(3,151		)
Amortization of discount/premium (2)	2			—		516			518
Transfers out (3)	—			—		—			—
Transfers in (3)	—			—		—			—
Realized gains, net	(11		)	—		—			(11		)
Unrealized appreciation (depreciation), net	348			46		(6		)	388
Ending Balance – December 31, 2013	$	36,257		$	3,536	$	30,172		$	69,965
Net change in unrealized appreciation/depreciation reported within the net change in unrealized appreciation on investments in our consolidated statement of operations attributable to our Level 3 assets still held as of December 31, 2013	$	348		$	46	$	(6	)	$	388

(1) Includes total cash distributions from CLO equity investments.

(2) Includes income accrual from CLO equity investments.

(3) Investments were transferred into and out of Level 3 and Level 2 due to changes in the quantity and quality of inputs obtained to support the fair value of each investment. Transfers into and out of the levels are recognized at the beginning of the period.

     The following table summarizes the significant unobservable inputs used in the determination of fair value for our Level 3 investments by category of investment and valuation technique as of December 31, 2014: 

					Range
	Fair Value as of December 31, 2014		Valuation Techniques/ Methodology	Unobservable Inputs	Minimum	Maximum	Weighted Average
First lien floating rate loans	$	5,678	Third-party vendor pricing service	Vendor quotes	N/A	N/A	N/A
Second lien floating rate loans	$	3,240	Third-party vendor pricing service	Vendor quotes	N/A	N/A	N/A
CLO equity	$	51,577	Discounted Cash Flow	Discount rate Prepayment rate Default rate	13.1% 30.0% 0.25%	15.6% 35.0% 2.0%	13.9% 30.3% 1.5%
Total	$	60,495

F-51

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

The following table summarizes the significant unobservable inputs used in the determination of fair value for our Level 3 investments by category of investment and valuation technique as of December 31, 2013:

					Range
	Fair Value as of December 31, 2013		Valuation Techniques/ Methodology	Unobservable Inputs	Minimum	Maximum	Weighted Average
First lien floating rate loans	$	36,257	Third-party vendor pricing service	Vendor quotes	N/A	N/A	N/A
Second lien floating rate loans	$	3,536	Third-party vendor pricing service	Vendor quotes	N/A	N/A	N/A
CLO equity	$	30,172	Discounted Cash Flow	Discount rate Prepayment rate Default rate	14.0% 30.0% 0.25%	18.0% 35.0% 2.0%	14.8% 31.3% 1.5%
Total	$	69,965

The significant unobservable inputs used in the fair value measurement of CLO equity include the default and prepayment rates used to establish projected cash flows and the discount rate applied in the valuation models to those projected cash flows. An increase in any one of these individual inputs in isolation would likely result in a decrease to fair value. However, given the interrelationship between these inputs, overall market conditions would likely have a more significant impact on our Level 3 fair values than changes in any one unobservable input.

Note 7. Debt

Revolving Credit Facility

On October 15, 2013, we entered into a revolving credit facility with ACAM (the “ACAM Facility”) which provided up to $200,000 to finance eligible investments, working capital expenses and general corporate requirements (comprised of Loan A and Loan B). Under the ACAM Facility, we were able to draw up to $180,000 under Loan A and up to $20,000 under Loan B at any one time. Any amounts drawn on Loan A had a fixed interest rate of 4.75% per annum and any amounts drawn on Loan B had a fixed interest rate of 7.25% per annum, with all interest paid upon maturity of the ACAM Facility. The ACAM Facility matured on the closing date of our IPO. On January 22, 2014, we repaid the ACAM Facility in full plus accrued interest and terminated it. For the year and period ended December 31, 2014 and 2013, we incurred interest expense of $568 and $943 on the ACAM Facility, respectively. As of December 31, 2013, the total debt outstanding on the ACAM Facility was $194,748.

Secured Revolving Credit Facility

On December 18, 2013, ACSF Funding entered into a two-year $140,000 secured revolving credit facility with Bank of America, N.A., as agent (the “Credit Facility”). ACSF Funding may make draws under the Credit Facility from time to time to purchase or acquire certain eligible assets. The Credit Facility is secured by ACSF Funding’s assets pursuant to a security agreement and contains customary financial and negative covenants and events of default. As of December 31, 2014 and 2013, the fair value of the assets in ACSF Funding was $220,421 and $0, respectively. The Credit Facility is non-recourse to ACSF. Amounts drawn under the Credit Facility bear interest at a rate per annum equal to either (a) LIBOR plus 1.80%, or (b) 0.80% plus the highest of (i) the Federal funds rate plus 0.50%, (ii) Bank of America, N.A.’s prime rate or (iii) one-month LIBOR plus 1%. ACSF Funding may borrow, prepay and reborrow loans under the Credit Facility at any time prior to November 18, 2015, the commitment termination date, subject to certain terms and conditions, including maintaining a borrowing base. Any outstanding balance on the Credit Facility as of the commitment termination date must be repaid on the maturity date, which is December 18, 2015, unless otherwise extended.

ACSF Funding is required to pay a commitment fee in an amount equal to 0.75% on the actual daily unused amount of the lender commitments under the Credit Facility from February 14, 2014 to the commitment termination date, payable quarterly in arrears. In addition, if ACSF Funding terminates the commitment amount in whole or in part prior to June 18, 2015, ACSF Funding will be required to pay a make-whole fee equal to the sum of the present values of all future spread amounts that would have been payable in respect of the total commitments (or terminated portion thereof) during the period from the termination date through June 18, 2015.

F-52

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

As of December 31, 2014, there was $130,000 outstanding under the Credit Facility which had a fair value of $130,000 and a weighted average interest rate of 1.96%. There were no borrowings outstanding under the Credit Facility as of December 31, 2013. The fair value of the Credit Facility is determined in accordance with ASC 820, which defines fair value in terms of the price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions and is measured with Level 3 inputs. As of December 31, 2014, ACSF Funding was in compliance with all covenants of the Credit Facility, including compliance with a borrowing base that applies various advance rates of up to 80% on the assets pledged as collateral by ACSF Funding.

For the year ended December 31, 2014, we incurred interest expense and commitment fees of $2,433 and $54, respectively, on the Credit Facility.

    The average debt outstanding for the year ended December 31, 2014 was $130,984. The weighted average annual interest cost, including commitment fees, for the year ended December 31, 2014 was 2.33%. Inclusive of 0.30% for amortization of debt issuance costs, the total average cost of funding for the year ended December 31, 2014 was 2.63%. The weighted average annual interest cost reflects the average interest cost during the period for both the ACAM Facility and the Credit Facility.

The average debt outstanding for the period ended December 31, 2013 was $89,524. The weighted average annual interest cost for the period ended December 31, 2013 was 5.0%.

Note 8. Taxes

From our inception through the date of our IPO, we were a taxable C corporation, subject to federal and state income taxes on our taxable ordinary income and capital gains. Prior to our IPO, we were a wholly-owned subsidiary of ACAM, which is wholly-owned by American Capital. As such, we were required to be consolidated in American Capital’s federal consolidated tax group, which has a September 30 tax year end. We had a tax sharing agreement with American Capital and other members of the consolidated tax group, under which such members bore their full share of their individual tax obligation and members were compensated for their losses and other tax benefits that were able to be used by other members of the consolidated tax group based on their pro forma stand-alone federal income tax return. For the year and period ended December 31, 2014 and 2013, we recognized $279 and $803, respectively, of federal and state tax expense related to our operations prior to our IPO.

We intend to elect to be taxed as a RIC under Subchapter M of the Code beginning with the date of our IPO through our tax fiscal year end of December 31 and for subsequent years. As part of our election to be taxed as a RIC, we intend to make a “deemed sale election” whereby we will treat our net unrealized gains (“net built-in gain”) on the date of our IPO as recognized for tax purposes in our final pre-IPO C corporation federal tax return. The federal tax sharing payment that we owed to American Capital attributed to our net built-in gain was $574. American Capital waived this payment which was then treated as a deemed capital contribution to us.

Excluding the deemed sale election, there were no significant tax consequences arising from the conversion to a RIC from a C corporation in connection with our IPO.

In order to qualify as a RIC for U.S. federal income tax purposes, we must meet certain annual distribution requirements, source of income tests and asset diversification rules. We were in compliance with the RIC requirements as of December 31, 2014.

As of December 31, 2014, we had approximately $1,997, or $0.20 per share, of estimated undistributed taxable income. We intend to distribute sufficient dividends, including dividends distributed in the following tax year that we elect to be treated as distributed in the current year, to eliminate our current year taxable income. As a result, no income tax provision has been provided in the financial statements other than the excise tax discussed below.

As a RIC, we are subject to a nondeductible U.S. federal excise tax of 4% on our undistributed "ordinary income" and "capital gain net income" (each as defined below) unless for each calendar year we distribute an amount equal to or greater than the sum of (a) 98% of our “ordinary income” (generally, our taxable income excluding net short-term and net long-term capital gains or losses for the calendar year), (b) 98.2% of our “capital gain net income” (including both net short-term and net long-term capital gains or losses) realized, subject to certain modifications, for the 12-month period ending October 31 of such calendar year, and (c) any income recognized, but not distributed, in the preceding years. For the year ended December 31, 2014, we accrued federal excise tax of $80.

Income determined under GAAP differs from income determined under tax because of both temporary and permanent differences in income and expense recognition, including (i) unrealized gains and losses associated with debt investments marked to fair value for GAAP but excluded from taxable income until realized or settled, (ii) differences arising due to the taxation of

F-53

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

CLO equity investments, (iii) premium amortization and gain adjustments attributed to built-in gain recognized prior to the date of IPO for tax purposes and (iv) capital losses in excess of capital gains earned in a tax year do not reduce current year taxable income, and generally will be carried forward to offset future capital gains.

GAAP/tax difference items that are permanent in nature are reclassified as paid-in capital. The following table provides the amount of reclassifications related to the permanent items for the tax year ended December 31, 2014:

	Year Ended December 31, 2014
Increase in undistributed net investment income	$	49
Decrease in accumulated net realized gain	$	(1,549	)
Increase in paid-in capital	$	1,500

Under the Regulated Investment Company Modernization Act of 2010, net capital losses incurred by us during the current year and any future years can be carried forward indefinitely until they are utilized subject to certain loss limitation rules. As of December 31, 2014, we have estimated net short term capital loss carry forwards of approximately $689.

As of December 31, 2014, the components of tax basis undistributed earnings were as follows:

	As of December 31, 2014
Undistributed ordinary income	$	1,997
Undistributed long-term capital gains	—
Capital loss carry forwards	(689		)
Net unrealized depreciation	(8,273		)
Other temporary differences	(32		)
Accumulated tax basis deficit	$	(6,997	)

The unrealized appreciation (depreciation) on our investments in securities for federal income tax purposes as of December 31, 2014 was as follows:

	As of December 31, 2014
Gross unrealized appreciation	$	182
Gross unrealized depreciation	(8,455		)
Tax basis net unrealized depreciation	$	(8,273	)
Tax basis of investments	$	284,643

The tax character of distributions paid during the year ended December, 31, 2014 was as follows:

	Year Ended December 31, 2014
Ordinary income	$	10,300
Long-term capital gains	$	—
Return of capital	$	—

We identify our major tax jurisdictions as federal and Maryland. During the period in which we were taxable as a C corporation, we were part of American Capital’s federal consolidated tax group, including its federal tax fiscal year ending September 30, 2014, which remains subject to examination by the Internal Revenue Service (“IRS”).

F-54

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

ACSF Funding is a wholly-owned limited liability company and is treated as a disregarded entity for federal income tax purposes.

We recognize tax benefits of uncertain tax positions only when the position is more likely than not to be sustained assuming examination by tax authorities. We have analyzed our tax positions and have concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years or expected to be taken in our current year tax returns. We are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next twelve months.

Note 9. Consolidated Financial Highlights

	Year Ended
	December 31, 2014
Per Share Data (1):
Gross proceeds from IPO	$	15.00
Net investment income	1.09
Net realized and unrealized loss on investments	(0.71		)
Net increase in net assets resulting from operations	0.38
Capital contribution (2)	0.06
Accretion (3)	0.09
Offering costs related to public offering	(0.08		)
Dividends and distributions to stockholders	(1.03		)
Net asset value, end of period	$	14.42
Per share market value, end of period	$	12.11
Total return based on market value (4)	(12.90		)%
Total return based on net asset value (4)	3.73		%
Ratios to Average Net Assets:
Net investment income	7.54		%
Operating expenses (5)	2.30		%
Interest and related expenses	2.39		%
Total expenses (5)	4.69		%
Supplemental Data:
Net assets, end of period	$	144,235
Shares outstanding, end of period	10,000,100
Average debt outstanding	$	130,984
Asset coverage per unit, end of period (6)	2,109
Portfolio turnover ratio	53.80		%

(1) Per share data for the year ended December 31, 2014 presumes the issuance of 10 million shares of common stock on January 1, 2014 that were issued in the IPO which closed on January 22, 2014. There was no established public trading market for the stock prior to the pricing of the IPO.

(2) Capital contribution from our Manager for $574 of federal taxes due on the net built-in gain on investments as a result of tax conversion to a RIC.

(3) The IPO issuance price of $15.00 per share was below the net asset value at that time. The amount reflects the immediate benefit to common stockholders at the time of the IPO for results of operations in 2013.

(4) Total return is based on the change in market price or net asset value per share during the period and takes into account dividends reinvested in accordance with the dividend reinvestment and stock purchase plan. The IPO price of $15.00 per share was used as the starting value for the total return for the year ended December 31, 2014.

(5) The ratio of operating expenses to average net assets and the ratio of total expenses to average net assets are shown net of the reimbursement for the expense cap. The ratio of operating expenses to average net assets and the ratio of total expenses to average net assets would be 2.99% and 5.38%, respectively, prior to the expense cap.

(6) The asset coverage ratio for a class of senior securities representing indebtedness is calculated on our consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by the senior securities representing indebtedness. This asset coverage ratio is multiplied by $1,000 to determine the asset coverage per unit.

F-55

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

The following is a schedule of financial highlights for the period from October 15, 2013 (commencement of operations) to December 31, 2013.

	Period from October 15, 2013 to December 31, 2013
Total return (1)	101,530	%
Net investment income to average net assets (2)	209	%
Expenses to average net assets (2)	745	%

(1) Total return is not annualized.

(2) Recurring income and expense items are annualized, one-time expenses such as organizational costs are not annualized.

Note 10. Capital Transactions

The following table details the common share transactions that occurred during the year and period ended December 31, 2014 and 2013:

	Year Ended December 31, 2014				Period from October 15, 2013* to December 31, 2013
	Shares	Amount			Shares	Amount
Common shares outstanding - beginning of period	100	$	1		100	$	1
Common shares issued in connection with initial public offering	10,000,000	150,000			—	—
Offering costs	—	(844		)	—	—
Contribution for taxes waived	—	574			—	—
Permanent differences reclassified (see Note 8)	—	1,500			—	—
Common shares outstanding - end of period	10,000,100	$	151,231		100	$	1

* Commencement of operations

Offering costs associated with the IPO totaled $844 and were recorded as a reduction of the proceeds from the sale of common shares. In connection with the IPO, the underwriters received an underwriting discount and commission (sales load) of $7,952 that was paid by our Manager.

The table below details the dividends declared on our shares of common stock since the completion of our IPO:

Dividend Declaration Date	Ex-Dividend Date	Record Date	Payment Date	Per Share Amount	Total Amount
March 17, 2014	March 27, 2014	March 31, 2014	April 10, 2014	$0.18	$1,800
June 18, 2014	June 26, 2014	June 30, 2014	July 10, 2014	$0.28	$2,800
September 17, 2014	September 26, 2014	September 30, 2014	October 10, 2014	$0.28	$2,800
December 18, 2014	December 29, 2014	December 31, 2014	January 9, 2015	$0.29	$2,900
					$10,300

Note 11. Commitments and Contingencies

In the ordinary course of business, we may be a party to certain legal proceedings, including actions brought against us and others with respect to investment transactions. The outcomes of any such legal proceedings are uncertain and, as a result of these proceedings, the values of the investments to which they relate could decrease. We were not subject to any material litigation against us as of December 31, 2014 and 2013.

F-56

AMERICAN CAPITAL SENIOR FLOATING, LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

DECEMBER 31, 2014

(in thousands, except share and per share amounts)

Note 12. Selected Quarterly Data (unaudited)

Quarter Ended	Investment Income				Net Investment Income				Net Gain (Loss) on Investments						Net Increase (Decrease) in Net Assets from Operations
	Total		Per Share		Total		Per Share		Total			Per Share			Total			Per Share
December 31, 2014	$	4,832	$	0.48	$	3,112	$	0.31	$	(4,538	)	$	(0.45	)	$	(1,426	)	$	(0.14	)
September 30, 2014	$	4,554	$	0.46	$	2,893	$	0.29	$	(2,647	)	$	(0.26	)	$	246		$	0.02
June 30, 2014	$	4,590	$	0.46	$	2,927	$	0.29	$	(78	)	$	(0.01	)	$	2,849		$	0.28
March 31, 2014	$	3,797	$	0.38	$	1,927	$	0.19	$	193		$	0.02		$	2,120		$	0.21
December 31, 2013*	$	1,572	n/a		$	246	n/a		$	769		n/a			$	1,016		n/a

* For the period October 15, 2013 (commencement of operations) to December 31, 2013

Note 13. Subsequent Event

On March 19, 2015, we declared a cash dividend of $0.29 per share for the first quarter of 2015 that is payable on April 6, 2015 to common stockholders of record as of March 31, 2015, with an ex-dividend date of March 27, 2015. On March 19, 2015, we announced that our Board of Directors approved a change to the common stock dividend schedule so that distributions will be made monthly rather than quarterly. On March 19, 2015, we declared a cash dividend of $0.097 per share of common stock for April 2015 that is payable on May 4, 2015 to common stockholders of record as of April 21, 2015, with an ex-dividend date of April 17, 2015.

F-57

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, and the Investment Company Act of 1940, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Bethesda and State of Maryland, on the 2nd day of November, 2015.

AMERICAN CAPITAL SENIOR FLOATING, LTD.
By:	/s/    Samuel A. Flax
	Samuel A. Flax
	Executive Vice President and Secretary

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed below by the following persons in the capacities and on the dates indicated:

Signature	Title	Date
*	Director, Chair of the Board and Chief Executive Officer (Principal Executive Officer)	November 2, 2015
Malon Wilkus
*	Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)	November 2, 2015
John R. Erickson
*	Director	November 2, 2015
Phyllis R. Caldwell
*	Director	November 2, 2015
Gil Crawford
*	Director	November 2, 2015
Larry K. Harvey
*	Director	November 2, 2015
Stan Lundine

* By: /s/ Samuel A. Flax    

Attorney-In-Fact

Part C—Other Information

Item 25. Financial Statements and Exhibits

1. Financial Statements:

Included in Parts A and B of the registration statement: 

AMERICAN CAPITAL SENIOR FLOATING, LTD.

INDEX TO JUNE 30, 2015 CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Statements of Assets and Liabilities as of June 30, 2015 (unaudited) and December 31, 2014	F-2
Consolidated Statements of Operations for the six months ended June 30, 2015 (unaudited) and June 30, 2014 (unaudited)	F-3
Consolidated Statements of Changes in Net Assets for the six months ended June 30, 2015 (unaudited) and June 30, 2014 (unaudited)	F-4
Consolidated Statements of Cash Flows for the six months ended June 30, 2015 (unaudited) and June 30, 2014 (unaudited)	F-5
Consolidated Schedule of Investments as of June 30, 2015 (unaudited)	F-6
Consolidated Schedule of Investments as of December 31, 2014	F-12
Notes to Consolidated Financial Statements	F-17

INDEX TO DECEMBER 31, 2014 CONSOLIDATED FINANCIAL STATEMENTS

Report of Independent Registered Accounting Firm	F-29
Consolidated Statements of Assets and Liabilities as of December 31, 2014 and 2013	F-30
Consolidated Statements of Operations for the year ended December 31, 2014 and the period from October 15, 2013 to December 31, 2013	F-31
Consolidated Statements of Changes in Net Assets for the year ended December 31, 2014 and the period from October 15, 2013 to December 31, 2013	F-32
Consolidated Statements of Cash Flows for the year ended December 31, 2014 and the period from October 15, 2013 to December 31, 2013	F-33
Consolidated Schedule of Investments as of December 31, 2014	F-34
Consolidated Schedule of Investments as of December 31, 2013	F-39
Notes to Consolidated Financial Statements	F-43

2. Exhibits:

Exhibit Number	Description
2.a*	American Capital Senior Floating, Ltd. Articles of Amendment and Restatement, incorporated herein by reference to Exhibit 3.1 of Form 10-Q for the quarter ended March 31, 2014 (File No. 814-01025), filed May 15, 2014.
2.b*	American Capital Senior Floating, Ltd. Amended and Restated Bylaws, incorporated herein by reference to Exhibit 3.2 of Form 10-Q for the quarter ended March 31, 2014 (File No. 814-01025), filed May 15, 2014.
2.d.1*	Instruments defining the rights of holders of securities: See Article VI of our Articles of Amendment and Restatement, incorporated herein by reference to Exhibit 3.1 of Form 10-Q for the quarter ended March 31, 2014 (File No. 814-01025), filed May 15, 2014.

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2.d.2*	Instruments defining the rights of holders of securities: See Article VII of our Amended and Restated Bylaws, incorporated herein by reference to Exhibit 3.2 of Form 10-Q for the quarter ended March 31, 2014 (File No. 814-01025), filed May 15, 2014.
2.d.3*	Form of Certificate of Common Stock, incorporated herein by reference to Exhibit 2.d.3 of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
2.d.4*	Form of Indenture, incorporated herein by reference to Exhibit 2.d.4 of the Registration Statement on Form N-2 (File No. 333-205463), filed July 2, 2015.
2.d.5*	Statement of Eligibility of Trustee on Form T-1, incorporated herein by reference to Exhibit 2.d.5 of the Registration Statement on Form N-2 (File No. 333-205463), filed July 2, 2015.
2.e*	American Capital Senior Floating, Ltd. Dividend Reinvestment and Stock Purchase Plan, incorporated herein by reference to Form S-3 (Registration Statement No. 333-205461), filed July 2, 2015.
2.g.1*	Management Agreement, dated as of January 15, 2014, between American Capital Senior Floating, Ltd. and American Capital ACSF Management, LLC, incorporated herein by reference to Exhibit 10.1 of Form 10-Q for the quarter ended March 30, 2014 (File No. 814-01025), filed May 15, 2014.
2.g.2*	Investment Advisory Agreement, dated as of December 18, 2013, between ACSF Funding I, LLC and American Capital ACSF Management, LLC, incorporated herein by reference to Exhibit 2.g.2 of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
2.h**	Form of Underwriting Agreement.
2.j*	Custodian Agreement, dated as of November 13, 2013, between American Capital Senior Floating, Ltd. and Deutsche Bank Trust Company Americas, incorporated herein by reference to Exhibit 2.j to Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
2.k.1*	Credit Agreement, dated as of October 15, 2013, between American Capital Senior Floating, Ltd. and American Capital Asset Management, LLC, incorporated herein by reference to Exhibit 2.k.2 of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
2.k.2	Amended and Restated Credit Agreement, dated as of October 29, 2015, among ACSF Funding I, LLC, the lenders party thereto and Bank of America, N.A., as administrative agent, filed herewith.
2.k.3*	Security Agreement, dated as of December 18, 2013, between ACSF Funding I, LLC and Bank of America, N.A., as administrative agent, incorporated herein by reference to Exhibit 2.k.4 of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013
2.k.4*	Sale Agreement, dated as of December 18, 2013, between American Capital Senior Floating, Ltd. and ACSF Funding I, LLC, incorporated herein by reference to Exhibit 2.k.5 of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
2.l.*	Opinion and consent of Arnold & Porter LLP, incorporated herein by reference to Exhibit 2.1 of Amendment No. 1 to the Registration Statement on Form N-2 (File No. 333-205463), filed August 14, 2015.
2.n.1	Consent of Ernst & Young LLP, filed herewith.
2.n.2*	Report of Ernst & Young LLP, independent registered accounting firm, regarding the “Senior Securities” table contained herein, incorporated herein by reference to Exhibit 2.n.2 of the Registration Statement on Form N-2 (File No. 333-205463), filed July 2, 2015.
2.p.1*	Subscription Agreement, dated as of February 11, 2013, between the Registrant and American Capital, Ltd., incorporated herein by reference to Exhibit 2.p.1 of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
2.p.2*	Contribution Agreement, dated as of October 15, 2013, between American Capital, Ltd. and American Capital Asset Management, LLC, incorporated herein by reference to Exhibit 2.p.2 of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
2.r*	American Capital Senior Floating, Ltd. Code of Ethics and Conduct, adopted January 14, 2014, incorporated herein by reference to Exhibit 2.r of Amendment No. 1 to Form N-2 (Registration Statement No. 333-190357), filed December 20, 2013.
24*	Power of Attorney of directors and officers, incorporated herein by reference to Exhibit 24 of the Registration Statement on Form N-2 (File No. 333-205463), filed July 2, 2015.
99*	Computation of Earnings to Fixed Charges, incorporated herein by reference to Exhibit 99 of the Registration Statement on Form N-2 (File No. 333-205463), filed July 2, 2015.

 _________________

* Previously filed.

** To be filed by amendment or incorporated by reference in connection with offerings of the Securities.

Item 26. Marketing Arrangements

The information contained under the heading “Plan of Distribution” on page 105 of the prospectus is incorporated herein by reference, and any information concerning any underwriters will be contained in the accompanying prospectus supplement, if any.

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Item 27. Other Expenses of Issuance and Distribution*

Commission Registration Fee	$	15,000
Accounting fees and expenses	60,000
Legal fees and expenses	350,000
Printing and engraving	100,000
Registrar and transfer agent’s fees	10,000
Miscellaneous fees and expenses	15,000
Total	$	550,000

 _________________

* Estimated for filing purposes and excludes fees previously paid.

Item 28. Persons Controlled By Or Under Common Control

American Capital Senior Floating, Ltd. has one wholly-owned special purpose vehicle, ACSF Funding I, LLC, a Delaware limited liability company.

Item 29. Number of Holders of Securities

The following table sets forth the number of record holders of our securities at October 30, 2015.

Title of Class	Number of Record Holders
Common Stock, par value $0.01 per share	4
Preferred Stock, par value $0.01 per share	—
Subscription Rights	—
Debt Securities	—

Item 30. Indemnification

Maryland law permits a Maryland corporation to include a provision in its charter limiting the liability of its directors and officers to the corporation and its stockholders for money damages, except for liability resulting from (a) actual receipt of an improper benefit or profit in money, property or services or (b) active and deliberate dishonesty that is established by a final judgment and is material to the cause of action. The registrant’s charter contains a provision that eliminates its directors’ and officers’ liability to the maximum extent permitted by Maryland law.

The registrant’s charter authorizes it, and its bylaws require it, to the maximum extent permitted by Maryland law, to indemnify any present or former director or officer or any individual who, while a director or officer of the registrant and at the request of the registrant, serves or has served another corporation, real estate investment trust, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise as a director, officer, partner, member, manager or trustee, from and against any claim or liability to which that individual may become subject or which that individual may incur by reason of his or her service in any of the foregoing capacities and to pay or reimburse his or her reasonable expenses in advance of final disposition of a proceeding, without requiring a preliminary determination of the ultimate entitlement to indemnification. The registrant’s charter and bylaws also permit it to indemnify and advance expenses to any individual who served any predecessor of the registrant in any of the capacities described above and any employee or agent of the registrant or any predecessor of the registrant.

Maryland law requires a Maryland corporation (unless its charter provides otherwise, which the registrant’s charter does not) to indemnify a director or officer who has been successful in the defense of any proceeding to which he or she is made or threatened to be made a party by reason of his or her service in that capacity. Maryland law permits a Maryland corporation to indemnify its present and former directors and officers, among others, against judgments, penalties, fines, settlements and reasonable expenses actually incurred by them in connection with any proceeding to which they may be made or threatened to be made a party by reason of their service in those or other capacities unless it is established that (a) the act or omission of the director or officer was material to the matter giving rise to the proceeding and (i) was committed in bad faith or (ii) was the result of active and deliberate dishonesty, (b) the director or officer actually received an improper personal benefit in money, property or services or (c) in the case of any criminal proceeding, the director or officer had reasonable cause to believe that the act or omission was unlawful. A Maryland corporation may not indemnify a director or officer who has been adjudged liable in a suit by or in the right

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of the corporation or for a judgment of liability on the basis that personal benefit was improperly received, unless in either case a court orders indemnification and then only for expenses.

In addition, Maryland law permits a Maryland corporation to advance reasonable expenses to a director or officer upon the corporation’s receipt of (a) a written affirmation by the director or officer of his or her good faith belief that he or she has met the standard of conduct necessary for indemnification by the corporation and (b) a written undertaking by him or her or on his or her behalf to repay the amount paid or reimbursed by the corporation if it is ultimately determined that the standard of conduct was not met. These provisions on indemnification and limitation of liability are subject to the limitations of the 1940 Act that prohibit us from protecting any director or officer against any liability to us or our stockholders arising from willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of such person’s office.

Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the “Securities Act”) may be permitted to our directors, officers and controlling persons pursuant to the provisions described above, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission (the “Commission”) such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person in the successful defense of an action, suit or proceeding) is asserted by a director, officer or controlling person in connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and will be governed by the final adjudication of the court of the issue.

Item 31. Business and Other Connections of Investment Adviser

A description of any other business, profession, vocation or employment of a substantial nature in which American Capital ACSF Management, LLC, and each managing director, director or executive officer of American Capital ACSF Management, LLC, is or has been during the past two fiscal years, engaged in for his or her own account or in the capacity of director, officer, employee, partner or trustee, is set forth in Part A of this registration statement in the sections entitled “Management—Board of Directors,” “Management—Executive Officers,” “Our Manager, American Capital and the Management Agreement” and “Portfolio Management.” Additional information regarding American Capital ACSF Management, LLC and its officers and directors is set forth in its Form ADV, which was filed with the Commission on March 31, 2015 (File No. 801-78610) under the Investment Advisers Act of 1940, as amended, and is incorporated herein by reference.

Item 32. Location of Accounts and Records

We will maintain at our principal office physical possession of each account, book or other document required to be maintained by Section 31(a) of the 1940 Act.

Item 33. Management Services

Not Applicable.

Item 34. Undertakings

We hereby undertake:

(1) to suspend the offering of shares until the prospectus is amended if (i) subsequent to the effective date of this registration statement, our net asset value declines more than ten percent from our net asset value as of the effective date of this registration statement (ii) our net asset value increases to an amount greater than its net proceeds as stated in the prospectus;

(2) if the securities being registered are to be offered to existing shareholders pursuant to warrants or rights, and any securities not taken by shareholders are to be reoffered to the public, to supplement the prospectus, after the expiration of the subscription period, to set forth the results of the subscription offer, the transactions by underwriters during the subscription period, the amount of unsubscribed securities to be purchased by underwriters, and the terms of any subsequent reoffering thereof. If any public offering by the underwriters of the securities being registered is to be made on terms differing from those set forth on the cover page of the prospectus, the Registrant shall undertake to file a post-effective amendment to set forth the terms of such offering;

(3) (a) to file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(1) to include any prospectus required by Section 10(a) (3) of the Securities Act;

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(2) to reflect in the prospectus any facts or events arising after the effective date of this registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; and

(3) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in this registration statement;

(b) that, for the purpose of determining any liabilities under the Securities Act, each post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering thereof;

(c) to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering;

(d) that, for the purpose of determining liability under the Securities Act to any purchaser, if the Registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 497(b), (c), (d) or (e) under the Securities Act as part of a registration statement relating to an offering, other than prospectus filed in reliance on Rule 430A under the Securities Act, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness, provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supercede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use;

(e) that for the purpose of determining liability of the Registrant under the Securities Act to any purchaser in the initial distribution of securities, the undersigned Registrant undertakes that in a primary offering of securities of the undersigned Registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to the purchaser:

(1) any preliminary prospectus or prospectus of the undersigned Registrant relating to the offering required to be filed pursuant to Rule 497 under the Securities Act;

(2) the portion of any advertisement pursuant to Rule 482 under the Securities Act relating to the offering containing material information about the undersigned Registrant or its securities provided by or on behalf of the undersigned Registrant; and

(3) any other communication that is an offer in the offering made by the undersigned Registrant to the purchaser; and

(4) (a) that, for the purpose of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by us under Rule 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective; and

(b) that, for the purpose of determining any liabilities under the Securities Act, each post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering thereof; and

(5) to send by first class mail or other means designed to ensure equally prompt delivery, within two business days of receipt of a written or oral request, any Statement of Additional Information.

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EX-2.K.2

Exhibit 2.k.2

AMENDED AND RESTATED CREDIT AGREEMENT

Dated as of October 29, 2015

among

ACSF FUNDING I, LLC,

as Borrower,

THE LENDER PARTIES HERETO,

BANK OF AMERICA, N.A.,as Administrative Agent

and

The Other Lender Parties Hereto

BANK OF AMERICA MERRILL LYNCH,

as

Sole Lead Arranger and Sole Book Manager

TABLE OF CONTENTS

SectionPage

ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS    1

1.01 Defined Terms.    1

1.02 Other Interpretive Provisions.    21

1.03 Accounting Terms.    21

1.04 Rounding.    21

1.05 [Reserved].    22

1.06 [Reserved].    22

1.07 Times of Day.    22

1.08 Business Day Convention.    22

ARTICLE II. THE COMMITMENTS AND CREDIT EXTENSIONS    22

2.01 Committed Loans.    22

2.02 Borrowings, Conversions and Continuations of Committed Loans.    22

2.03 Prepayments.    24

2.04 Termination or Reduction of Commitments.    25

2.05 Repayment of Loans.    25

2.06 Interest.    25

2.07 Fees.    26

2.08 Computation of Interest and Fees.    27

2.09 Evidence of Debt.    27

2.10 Payments Generally; Administrative Agent’s Clawback.    27

2.11 Sharing of Payments by Lenders.    29

2.12 Defaulting Lenders.    30

ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY    31

3.01 Taxes.    31

3.02 Illegality.    36

3.03 Inability to Determine Rates.    37

3.04 Increased Costs; Reserves on Eurocurrency Rate Loans.    37

3.05 Compensation for Losses.    39

3.06 Mitigation Obligations; Replacement of Lenders.    40

3.07 Survival.    40

ARTICLE IV. CONDITIONS PRECEDENT TO CREDIT EXTENSIONS    40

4.01 Conditions of Initial Credit Extension.    40

4.02 Conditions to all Credit Extensions.    42

ARTICLE V. REPRESENTATIONS AND WARRANTIES    44

5.01 Existence, Qualification and Power.    44

5.02 Authorization; No Contravention.    44

5.03 Governmental Authorization; Other Consents.    44

5.04 Binding Effect.    44

5.05 Financial Statements; No Material Adverse Effect.    45

5.06 Litigation.    45

5.07 No Default.    45

5.08 Liens.    46

5.09 Taxes.    46

5.10 ERISA Matters.    46

5.11 Equity Interests.    46

5.12 Margin Regulations; Investment Company Act.    46

5.13 Disclosure.    47

i

TABLE OF CONTENTS (continued)

SectionPage

5.14 Compliance with Laws.    47

5.15 Taxpayer Identification Number; Other Identifying Information.    47

5.16 OFAC.    47

ARTICLE VI. AFFIRMATIVE COVENANTS    48

6.01 Financial Statements.    48

6.02 Certificates; Other Information.    49

6.03 Notices.    51

6.04 Payment of Obligations.    51

6.05 Preservation of Existence, Etc.    51

6.06 [RESERVED].    52

6.07 Further Assurances.    52

6.08 Compliance with Laws.    52

6.09 Books and Records.    52

6.10 Inspection Rights.    52

6.11 Use of Proceeds.    52

6.12 Approvals and Authorizations.    53

6.13 Special Purpose Entity Requirements.    53

6.14 Security Interest.    53

6.15 ERISA Matters.    53

ARTICLE VII. NEGATIVE COVENANTS    53

7.01 Liens.    53

7.02 Investments.    53

7.03 Indebtedness; Bank Accounts.    53

7.04 Fundamental Changes.    54

7.05 Sale of Collateral Assets.    54

7.06 Restricted Payments.    54

7.07 Transactions with Affiliates.    54

7.08 Burdensome Agreements.    54

7.09 Use of Proceeds.    55

7.10 Sanctions.    55

7.11 Special Purpose Entity Requirements.    55

7.12 Investment Advisory Agreement and Sale Agreement Amendment.    55

7.13 ERISA.    55

ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES    56

8.01 Events of Default.    56

8.02 Remedies Upon Event of Default.    57

8.03 Application of Funds.    58

ARTICLE IX. ADMINISTRATIVE AGENT    58

9.01 Appointment and Authority.    58

9.02 Rights as a Lender.    59

9.03 Exculpatory Provisions.    59

9.04 Reliance by Administrative Agent.    60

9.05 Delegation of Duties.    60

9.06 Resignation of Administrative Agent.    61

9.07 Non-Reliance on Administrative Agent and Other Lenders.    62

9.08 No Other Duties, Etc.    62

9.09 Administrative Agent May File Proofs of Claim.    62

ii

TABLE OF CONTENTS (continued)

SectionPage

9.10 Collateral Matters.    63

ARTICLE X. MISCELLANEOUS    63

10.01 Amendments, Etc.    63

10.02 Notices; Effectiveness; Electronic Communication.    64

10.03 No Waiver; Cumulative Remedies; Enforcement.    67

10.04 Expenses; Indemnity; Damage Waiver.    67

10.05 Payments Set Aside.    69

10.06 Successors and Assigns.    70

10.07 Treatment of Certain Information; Confidentiality.    74

10.08 Right of Setoff.    75

10.09 Interest Rate Limitation.    76

10.10 Counterparts; Integration; Effectiveness.    76

10.11 Survival of Representations and Warranties.    76

10.12 Severability.    77

10.13 Replacement of Lenders.    77

10.14 Governing Law; Jurisdiction; Etc.    78

10.15 Waiver of Jury Trial.    79

10.16 No Advisory or Fiduciary Responsibility.    79

10.17 Electronic Execution of Assignments and Certain Other Documents.    80

10.18 USA PATRIOT Act.    80

10.19 Compliance with Laws.    80

10.20 Non-Recourse Obligations; No Petition.    80

10.21 Time of the Essence.    81

10.22 Judgment Currency.    81

iii

SCHEDULES

2.01    Commitments and Applicable Percentages

5.15 Taxpayer Identification Number; Other Identifying Information

10.02    Administrative Agent’s Office; Certain Addresses for Notices

EXHIBITS

Form of

A    Committed Loan Notice

B    Note

C-1    Assignment and Assumption

C-2    Administrative Questionnaire

D-1    Compliance Certificate (Borrower Parent)

D-2    Compliance Certificate (Borrower)

E    U.S. Tax Compliance Certificates

ANNEXES

A    Advance Rates

B    Eligibility and Portfolio Criteria

C    Definitions Relating to Collateral Assets

D    Special Purpose Entity Requirements

iv

CREDIT AGREEMENT

This CREDIT AGREEMENT (“Agreement”) is entered into as of October 29, 2015 (the “Second Closing Date”),amongACSF Funding I, LLC, a Delaware limited liability company (the “Company” or the “Borrower”), each lender from time to time party hereto (collectively, the “Lenders” and individually, a “Lender”) and BANK OF AMERICA, N.A., as Administrative Agent.

The Company has requested that the Lenders provide a revolving credit facility (the “Facility”), and the Lenders are willing to do so on the terms and conditions set forth herein.

The Company, the Lenders and the Adminstrative Agent, being the parties to the Credit Agreement dated as of December 18, 2013 (the “Original Agreement”), have agreed pursuant to Section 10.01 of the Original Agreement to amend and restate the Original Agreement as set forth herein.

In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS

1.01Defined Terms.

As used in this Agreement, the following terms shall have the meanings set forth below:

“Additional Current Pay Criteria” has the meaning specified in Annex C.

“Administrative Agent” means Bank of America in its capacity as administrative agent under any of the Loan Documents, or any successor administrative agent.

“Administrative Agent’s Office” means, with respect to any currency, the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 10.02 with respect to such currency, or such other address or account with respect to such currency as the Administrative Agent may from time to time notify to the Company and the Lenders.

“Administrative Questionnaire” means an Administrative Questionnaire in substantially the form of Exhibit C‑2 or any other form approved by the Administrative Agent.

“Advance Rate” means a percentage applicable to each Collateral Asset as specified in Annex A under the caption "Advance Rate”.

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

“Aggregate Commitments” means the Commitments of all the Lenders.

1

“Aggregate Market Value” has the meaning specified in Annex C.

“Agreement” means this Credit Agreement.

“Applicable Percentage” means with respect to any Lender at any time, the percentage (carried out to the ninth decimal place) of the Aggregate Commitments represented by such Lender’s Commitment at such time, subject to adjustment as provided in Section 2.12. If the commitment of each Lender to make Loans has been terminated pursuant to Section 8.02 or if the Aggregate Commitments have expired, then the Applicable Percentage of each Lender shall be determined based on the Applicable Percentage of such Lender most recently in effect, giving effect to any subsequent assignments by any Lender. The initial Applicable Percentage of each Lender is set forth opposite the name of such Lender on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable.

“Applicable Rate” means a per annum rate equal to 1.80%.

“Approved Dealer” has the meaning specified in Annex C.

“Approved Fund” means any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” means Bank of America, an affiliate of Merrill Lynch, Pierce, Fenner & Smith Incorporated, in its capacity as sole lead arranger and sole book manager.

“Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 10.06(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit C-1 or any other form (including electronic documentation generated by MarkitClear or other electronic platform) approved by the Administrative Agent.

“Audited Financial Statements” means, for any fiscal year, the audited consolidated balance sheet of the Borrower Parent for such fiscal year ended December 31, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for such fiscal year of Borrower Parent, including the notes thereto.

“Availability Period” means the period (i) beginning on the Closing Date and (ii) ending on the earlier of (A) any date on which an Event of Default has occurred or (B) the date that is 30 days prior to the Maturity Date.

“Bank Loan” has the meaning specified in Annex C.

“Bank of America” means Bank of America, N.A. and its successors.

“Base Rate” means for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the Prime Rate in effect for such day and (c) the Eurocurrency Rate based on 1-month LIBOR plus 1%.

2

“Base Rate Loan” means a Loan that bears interest based on the Base Rate. All Base Rate Loans shall be denominated in Dollars.

“Borrower” has the meaning specified in the introductory paragraph hereto.

“Borrower Certification” means with respect to any request for a Loan or any release of funds or substitution of assets with respect to the Collateral Account, a certification of the Investment Adviser on behalf of the Borrower stating that after giving effect to such Loan, release of funds or substitution: (A) (i) no Borrowing Base Deficiency will exist, and (ii) no Default would occur or be continuing, in each case based on the most recent Borrowing Base determination; and (B) in the case of any Loan, the proceeds of such Loan will be used solely for Permitted Uses and, in the case that such proceeds will be used to purchase an Eligible Collateral Asset, no Borrowing Base Deficiency would exist after giving effect to such purchase on a pro forma basis.

“Borrower Materials” has the meaning specified in Section 6.02.

“Borrower Parent” means American Capital Senior Floating Ltd.

“Borrowing” means a Committed Borrowing.

“Borrowing Base” has the meaning specified in Annex C.

“Borrowing Base Deficiency” has the meaning specified in Annex C.

“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the Laws of, or are in fact closed in, the state where the Administrative Agent’s Office is located (which is initially North Carolina) or New York, New York and, if such day relates to any interest rate settings as to a Eurocurrency Rate Loan, any fundings, disbursements, settlements and payments in respect of any such Eurocurrency Rate Loan, or any other dealings in Dollars to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means any such day that is also a London Banking Day.

“Cash” has the meaning specified in Annex C.

“Cash Equivalents” has the meaning specified in Annex C.

“Change in Investment Adviser” means:

(i) the Investment Adviser ceases to be responsible for the day-to-day management of the Borrower or Borrower Parent, including, without limitation, ceasing to be substantially involved in directing the investment decisions of the Borrower or Borrower Parent;

(ii) the Investment Adviser (A) changes its investment management arrangements with Borrower Parent such that Investment Adviser ceases to be an Affiliate of Borrower Parent by virtue of such arrangements or (B) ceases to be an Affiliate of Investment Adviser Parent, in each case including without limitation by merger or consolidation or sale or transfer all or substantially all of its business to any individual or entity; or

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(iii) (A) the Investment Adviser becomes insolvent, or fails to pay its debts as they become due or admits in writing its inability to pay its debts as they become due or (B) the Investment Adviser (w) institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; (x) or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or (y) any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of the Investment Adviser or its Affiliates and the appointment continues undischarged or unstayed for 60 calendar days; or (z) any proceeding under any Debtor Relief Law relating to the Investment Adviser or to all or any material part of its property is instituted without the consent of the Investment Adviser or its Affiliates and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding.

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

“Closing Date” means December 18, 2013.

“Code” means the Internal Revenue Code of 1986, as amended.

“Collateral” shall have the meaning specified in the Security Agreement.

“Collateral Account” shall have the meaning specified in the Collateral Administration Agreement.

“Collateral Administration Agreement” means the Collateral Administration Agreement between the Administrative Agent, the Company and the Collateral Administrator, dated as of the Closing Date (as amended, restated, extended, supplemented or otherwise modified in writing from time to time).

“Collateral Administrator” means Deutsche Bank Trust Company Americas and any successor thereto as collateral administrator under the Collateral Administration Agreement.

“Collateral Asset” has the meaning specified in Annex C.

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“Collateral Dispute Notice” has the meaning specified in Annex C.

“Collateral Value Condition” means a decline in the Net Asset Value due to a change in the Current Market Values of one or more Collateral Assets, or an adverse change in general market conditions.

“Commitment” means, as to each Lender, its obligation to make Committed Loans to the Borrower pursuant to Section 2.01, in an aggregate principal amount at any one time outstanding not to exceed the Dollar amount set forth opposite such Lender’s name on Schedule 2.01 or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement.

“Commitment Fee Rate” means (a) prior to February 14, 2014, 0.0%, and (b) on or after such date (x) on any day after the Second Closing on which the Outstanding Amount of Committed Loans exceeds an amount equal to 90% of the Aggregate Commitments, 0.00% and (y) otherwise, 0.75%, in each case subject to adjustment as provided in Section 2.12.

“Committed Borrowing” means a borrowing consisting of simultaneous Committed Loans of the same Type and, in the case of Eurocurrency Rate Loans, having the same Interest Period made by each of the Lenders pursuant to Section 2.01.

“Committed Loan” has the meaning specified in Section 2.01.

“Committed Loan Notice” means a notice of (a) a Committed Borrowing, (b) a conversion of Committed Loans from one Type to the other, or (c) a continuation of Eurocurrency Rate Loans or Base Rate Loans, pursuant to Section 2.02(a), which, if in writing, shall be substantially in the form of Exhibit A.

“Company” has the meaning specified in the introductory paragraph hereto.

“Compliance Certificate” means a certificate substantially in the form of Exhibit D-1 orExhibit D-2.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Contractual Obligation” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

“Credit Extension” means a Borrowing.

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“Credit Trigger” means any of the following: (i) a Regulatory Event with respect to any Key Personnel, Investment Adviser or Investment Adviser Parent, (ii) a Change in Investment Adviser, (iii) a Key Personnel Event or (iv) the Net Asset Value is less than $25 million on any date on or after the Closing Date and such Net Asset Value deficiency is not cured within 3 days following notice thereof to the Borrower by the Administrative Agent.

“Current Market Price” has the meaning specified in Annex C.

“Current Market Value” has the meaning specified in Annex C.

“Current Market Value Percentage” has the meaning specified in Annex C.

“Current Pay Obligation” has the meaning specified in Annex C.

“Debtor Relief Laws” has the meaning specified in Annex C.

“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of time, or both, would be an Event of Default.

“Default Rate” means, with respect to the Obligations, an interest rate equal to the Prime Rate + 2.00%.

“Defaulted Obligation” has the meaning specified in Annex C.

“Defaulting Lender” means, subject to Section 2.12(b), any Lender that (a) has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Company in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within two Business Days of the date when due, (b) has notified the Company and the Administrative Agent in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Administrative Agent or the Company, to confirm in writing to the Administrative Agent and the Company that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Company), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in

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such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above, and of the effective date of such status, shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.12(b)) as of the date established therefor by the Administrative Agent in a written notice of such determination, which shall be delivered by the Administrative Agent to the Company and each other Lender promptly following such determination.

“Designated Jurisdiction” means any country or territory to the extent that such country or territory itself is the subject of any Sanction; it being agreed that in no event shall the United States of America be a Designated Jurisdiction.

“DIP Loan” has the meaning specified in Annex C.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition (including any sale and leaseback transaction) of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

“Disqualified Lender” has the meaning specified in Section 10.06(b)(v).

“Distressed Exchange Offer” has the meaning specified in Annex C.

“Dollar”, “USD” and “$” have the meaning specified in Annex C.

“Dollar Equivalent” means, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in any other currency, the equivalent amount thereof in Dollars as determined by the Administrative Agent at such time on the basis of the current spot rate determined by the Administrative Agent in a commercially reasonable manner.

“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 10.06(b)(iii) and (v) (subject to such consents, if any, as may be required under Section 10.06(b)(iii)).

“Eligible Collateral Asset” has the meaning specified in Annex C.

“Eligible Collateral Asset Information” has the meaning specified in the Collateral Administration Agreement.

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“Equity Interests” means, with respect to any Person, all of the shares of capital stock of (or other ownership or profit interests in) such Person, all of the warrants, options or other rights for the purchase or acquisition from such Person of shares of capital stock of (or other ownership or profit interests in) such Person, all of the securities convertible into or exchangeable for shares of capital stock of (or other ownership or profit interests in) such Person or warrants, rights or options for the purchase or acquisition from such Person of such shares (or such other interests), and all of the other ownership or profit interests in such Person (including partnership, member or trust interests therein), whether voting or nonvoting, and whether or not such shares, warrants, options, rights or other interests are outstanding on any date of determination.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

“ERISA Affiliate” means any trade or business (whether or not incorporated) under common control with the Company within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

“Eurocurrency Rate” means:

(a)    With respect to any Eurocurrency Rate Loan, the rate per annum equal to the London Interbank Offered Rate (“LIBOR”) or a comparable or successor rate which rate is approved by the Administrative Agent, as published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for deposits in Dollars (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period; and

(b)    for any rate calculation with respect to a Base Rate Loan on any date, the rate per annum equal to LIBOR, at or about 11:00 a.m., London time determined two Business Days prior to such date for Dollar deposits with a term of one month commencing that day; provided that to the extent a comparable or successor rate is approved by the Administrative Agent in connection with any rate set forth in this definition, the approved rate shall be applied to the applicable Interest Period in a manner consistent with market practice; provided, further that to the extent such market practice is not administratively feasible for the Administrative Agent, such approved rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent.

“Eurocurrency Rate Loan” means a Committed Loan that bears interest at a rate based on clause (a) of the definition of “Eurocurrency Rate”.

“Event of Default” has the meaning specified in Section 8.01.

“Excluded Affiliate” means an Excluded Horizontal Affiliate or Excluded Managed Fund.

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“Excluded Horizontal Affiliate” means with respect to Affiliates of the Company, any Person which is an Affiliate solely because such Person is owned or controlled by American Capital Ltd., except that the Investment Adviser, Investment Adviser Parent, Borrower Parent, the Borrower or any other direct or indirect subsidiary of Borrower Parent shall not be Excluded Horizontal Affiliates.

“Excluded Managed Fund” means with respect to Affiliates of the Company, any Person which is an Affiliate solely because such Person is a managed fund managed by Investment Adviser or its Affiliates, except that the Investment Adviser, Investment Adviser Parent, Borrower Parent, the Borrower or any other direct or indirect subsidiary of Borrower Parent shall not be Excluded Managed Funds.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to any Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Company under Section 10.13) or (ii) such Lender changes its Lending Office, except in each case to the extent that, pursuant to Section 3.01(a)(ii) or (c), amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its Lending Office, (c) Taxes attributable to such Recipient’s failure to comply with Section 3.01(e) and (d) any U.S. federal withholding Taxes imposed pursuant to FATCA.

“Facility” has the meaning specified in the recitals hereto.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code and any intergovernmental agreements implementing the foregoing (including any legislation, rules or practices adopted pursuant to such intergovernmental agreements).

“Federal Funds Rate” means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent.

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“Fee Letter” means each of the First Fee Letter and the Second Fee Letter.

“First Fee Letter” means the letter agreement, dated as of the Closing Date, between the Company and the Administrative Agent.

“First Lien Bank Loan” has the meaning specified in Annex C.

“Fitch” has the meaning specified in Annex C.

“Fitch Rating” has the meaning specified in Annex C.

“Foreign Lender” means, a Recipient that is not a U.S. Person.

“FRB” means the Board of Governors of the Federal Reserve System of the United States.

“Fund” means any Person (other than a natural Person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.

“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

“Governmental Authority” means the government of the United States or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).

“Guarantee” means, as to any Person, without duplication of amounts, (a) any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation payable or performable by another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation, (ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other obligation of the payment or performance of such Indebtedness or other obligation, (iii) to maintain working capital, equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation, or (iv) entered into for the purpose of assuring in any other manner the obligee in respect of such Indebtedness or other obligation of the payment or performance thereof or to protect such obligee against loss in respect thereof (in whole or in part), or (b) any Lien on any assets of such

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Person securing any Indebtedness or other obligation of any other Person, whether or not such Indebtedness or other obligation is assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien). The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.

“Indebtedness” means, as to any Person at a particular time, without duplication, all of the following, whether or not included as indebtedness or liabilities in accordance with GAAP:

(a)    all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments;

(b)    all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments;

(c)    net obligations of such Person under any Swap Contract;

(d)    all obligations of such Person to pay the deferred purchase price of property or services (other than accounts payable in the ordinary course of business, provided that the aggregate of any such amounts due and payable at any time shall not exceed $100,000);

(e)    indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse;

(f)    capital leases and Synthetic Lease Obligations;

(g)    all obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Equity Interest in such Person or any other Person, valued, in the case of a redeemable preferred interest, at the greater of its voluntary or involuntary liquidation preference plus accrued and unpaid dividends;

(h)    any Swap Contract under which the Swap Termination Value thereof with respect to Borrower could be less than zero as of any date during the term of such Swap Contract, regardless of the actual Swap Termination Value as of any date; and

(i)    all Guarantees of such Person in respect of any of the foregoing.

For all purposes hereof, the Indebtedness of any Person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Indebtedness is expressly made non-recourse to such Person.

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“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of the Company under any Loan Document and (b) to the extent not otherwise described in clause (a), Other Taxes.

“Indemnitee” has the meaning specified in Section 10.04(b).

“Indictment Event” has the meaning specified in the definition of “Regulatory Event”.

“Information” has the meaning specified in Section 10.07.

“Interest Payment Date” means, (a) as to any Loan other than a Base Rate Loan, the last day of each Interest Period applicable to such Loan and the Maturity Date; provided, however, that if any Interest Period for a Eurocurrency Rate Loan exceeds three months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates; and (b) as to any Base Rate Loan, the last Business Day of each March, June, September and December and the Maturity Date.

“Interest Period” means as to each Eurocurrency Rate Loan, the period commencing on the date such Eurocurrency Rate Loan is disbursed or converted to or continued as a Eurocurrency Rate Loan and ending on the date one week, two weeks or one, three or six months thereafter (in each case, subject to availability), as selected by the Company in its Committed Loan Notice; provided that:

(i)    any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless, in the case of a Eurocurrency Rate Loan, such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;

(ii)    any Interest Period pertaining to a Eurocurrency Rate Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and

(iii)    no Interest Period shall extend beyond the Maturity Date.

“Investment Company Act” means the Investment Company Act of 1940, as amended.

“Investment Adviser” means American Capital ACSF Management, LLC (including any successor to the Investment Adviser by reason of an internal restructuring or other internal reorganization and which is controlled and managed by substantially the same individuals that are currently involved in the day-to-day operations of the Investment Adviser as of the Closing Date).

“Investment Adviser Parent” means American Capital Asset Management, LLC or (without prejudice to the provisions relating to a Change in Investment Adviser) any successor in interest thereto that controls, directly or indirectly, the Investment Adviser.

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“Investment Advisory Agreement” means the Investment Advisory Agreement dated as of the Closing Date between the Investment Adviser and the Borrower.

“IRS” means the United States Internal Revenue Service.

“Key Personnel” means each of Mark Pelletier, Michael Cerullo, Dana Dratch, William Weiss, and Juan Miguel Estela and any individuals approved by the Administrative Agent in its reasonable discretion as replacement key personnel for purposes of this definition.

“Key Personnel Event” means that on any date there are not at least 2 of the Key Personnel responsible for the day-to-day management of the Borrower, such responsibility to include, without limitation, being substantially involved in directing the investment decisions of the Borrower (whether such services are provided directly or indirectly through the Investment Adviser) and such condition exists for 45 consecutive days after such date.

“Laws” has the meaning specified in Annex C.

“Lenders” has the meaning specified in the introductory paragraph hereto.

“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative Questionnaire, or such other office or offices as a Lender may from time to time notify the Company and the Administrative Agent.

“LIBOR” has the meaning specified in the definition of Eurocurrency Rate.

“Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), charge, or preference, priority or other security interest or preferential arrangement in the nature of a security interest of any kind or nature whatsoever (including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any financing lease having substantially the same economic effect as any of the foregoing).

“Limited Liability Company Agreement” means the Amended and Restated Limited Liability Company Agreement of the Company dated as of December 18, 2013 including any permitted amendments thereto from time to time.

“Loan” means an extension of credit by a Lender to the Borrower under Article II in the form of a Committed Loan.

“Loan Documents” means this Agreement, the Security Agreement, the Collateral Administration Agreement, each Assignment and Assumption, each Note and each Fee Letter.

“London Banking Day” means any day on which dealings in Dollar deposits are conducted by and between banks in the London interbank Eurodollar market.

“Makewhole Fee” has the meaning specified in Section 2.07(b).

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“Markit” has the meaning specified in Annex C.

“Material Adverse Effect” means, relative to any occurrence of whatever nature (including any adverse determination in any litigation, arbitration, or governmental investigation or proceeding), a materially adverse effect on (a) the financial condition or operations of the Borrower, (b) the legality, validity or enforceability of any of the Loan Documents, (c) the right or ability of the Borrower to perform any of its obligations under any of the Loan Documents, or (d) the rights or remedies of the Lender under any of the Loan Documents or of the Borrower under the Collateral Assets.

“Maturity Date” meansthe fifth anniversary of the Closing Date; provided, however, that if such date is not a Business Day, the Maturity Date shall be the next following Business Day.

“Moody’s” has the meaning specified in Annex C.

“Moody’s Rating” has the meaning specified in Annex C.

“Non-Qualifying Assets” has the meaning specified in Annex C.

“Net Asset Value” means an amount equal to the excess of (i) (A) the aggregate of the Current Market Values of each Collateral Asset which is a First Lien Bank Loan, Second Lien Bank Loan, Senior Secured Bond or Senior Unsecured Bond (whether or not meeting the Eligibility Criteria and whether or not included in the Borrowing Base) (excluding, for the avoidance of doubt, Cash and Cash Equivalents) plus (B) the par value of all Cash and Cash Equivalents owned by the Borrower over (ii) the sum of the Total Outstandings and other Indebtedness of the Borrower, in each case expressed as a Dollar Equivalent if applicable.

“Non-Consenting Lender” means any Lender that does not approve any consent, waiver or amendment that (i) requires the approval of a majority of Lenders or all Lenders or all affected Lenders in accordance with the terms of Section 10.01 and (ii) has been approved by the Required Lenders.

“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.

“Note” means a promissory note made by the Borrower in favor of a Lender evidencing Loans made by such Lender to the Borrower, substantially in the form of Exhibit B.

“Obligations” has the meaning specified in Annex C.

“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

“Offer” has the meaning specified in Annex C.

“Organization Documents” means, (a) with respect to any corporation, the certificate or articles of incorporation and the bylaws (or equivalent or comparable constitutive documents with

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respect to any non-U.S. jurisdiction); (b) with respect to any limited liability company, the certificate or articles of formation or organization and operating agreement; and (c) with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.

“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.06).

“Outstanding Amount” means, with respect to Committed Loans on any date, the aggregate outstanding principal amount thereof after giving effect to any borrowings and prepayments or repayments of such Committed Loans occurring on such date.

“Overnight Rate” means, for any day, the greater of (i) the Federal Funds Rate and (ii) an overnight rate determined by the Administrative Agent, in accordance with banking industry rules on interbank compensation.

“Participant” has the meaning specified in Section 10.06(d).

“Participant Register” has the meaning specified in Section 10.06(d).

“Permitted Liens” means any of the following as to which no enforcement, collection, execution, levy or foreclosure proceeding shall have been commenced: (a) Liens for state, municipal or other local Taxes if such Taxes shall not at the time be due and payable or if a Person shall currently be contesting the validity thereof in good faith by appropriate proceedings and with respect to which reserves in accordance with GAAP have been provided on the books of such Person, (b) Liens imposed by Laws, such as materialmen’s, warehousemen’s, mechanics’, carriers’, workmen’s and repairmen’s Liens and other similar Liens, arising by operation of law in the ordinary course of business for sums that are not overdue or are being contested in good faith, (c) Liens in favor of the Administrative Agent or any Lender granted pursuant to or by any Loan Document and (d) a Permitted Collateral Administrator Lien (as defined in the Collateral Administration Agreement). Notwithstanding the preceding sentence, no Lien for any Indebtedness other than the Obligations will be a Permitted Lien.

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“Permitted Net Interest Amount” for any year means an amount reasonably demonstrated by the Borrower and confirmed by the Administrative Agent (such confirmation not to be unreasonably withheld or delayed) not to exceed the amount of taxable income attributed to Borrower’s assets as determined by the Code (less any other distributions from Borrower to Borrower Parent during such year, except distributions permitted under clause (iv) of Permitted Uses).

“Permitted Uses” means (i) the purchase or acquisition of assets certified by the Borrower to be Eligible Collateral Assets at the time of purchase or acquisition, provided that for the purposes of making such certifications, the Borrower may rely upon its good faith expectation as to (1) the Relevant Obligor Domicile or Current Market Value that will be determined by the Administrative Agent in relation to the relevant Collateral Asset and (2) solely in relation to Collateral Assets being acquired by Borrower at the initial issuance or funding thereof, (A) the availability of data with respect to such Collateral Asset from the applicable Pricing Source or (B) the number of pricing quotes available to the Administrative Agent from Approved Dealers in respect of such Collateral Asset; (ii) the payment of Taxes, fees or other expenses of Borrower to maintain its legal existence; (iii) payment of investment management fees pursuant to the Investment Advisory Agreement; (iv) distributions to Borrower Parent that will be used solely to pay overhead expenses (not to exceed $1,000,000 per year); (v) distributions to Borrower Parent that will be used to make payment of dividends required to be paid by Borrower Parent in order to maintain its status as a “regulated investment company” pursuant to and in accordance with the Code, in an amount not to exceed the Permitted Net Interest Amount in any year; and (vi) solely with respect to (1) the initial Credit Extension, the payment of any amounts due under the First Fee Letter and (2) the first Credit Extension after the Second Closing Date, the payment of any amounts due under the Second Fee Letter.

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” means any “employee pension benefit plan” within the meaning of Section 3(2) of ERISA that is subject to Title IV of ERISA or Section 4975 of the Code.

“Plan Assets” means assets of any (i) employee benefit plan (as defined in Section 3(3) of ERISA) subject to Title I of ERISA, (ii) plan (as defined in Section 4975(e)(1) of the Code) to which Section 4975 of the Code applies, or (iii) non-US, church or governmental plan subject to non-US, federal, state or local laws, rules or regulations substantially similar to Title I of ERISA or Section 4975 of the Code.

“Platform” has the meaning specified in Section 6.02.

“Pricing Source” has the meaning specified in Annex C.

“Prime Rate” means the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate.” The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans,

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which may be priced at, above, or below such announced rate. Any change in such prime rate announced by Bank of America shall take effect at the opening of business on the day specified in the public announcement of such change.

“Public Lender” has the meaning specified in Section 6.02.

“Rate Determination Date” means two (2) Business Days prior to the commencement of such Interest Period (or such other day as is generally treated as the rate fixing day by market practice in such interbank market, as determined by the Administrative Agent; provided that to the extent such market practice is not administratively feasible for the Administrative Agent, such other day as otherwise reasonably determined by the Administrative Agent).

“Recipient” means the Administrative Agent and any Lender, as applicable.

“Register” has the meaning specified in Section 10.06(c).

“Registered” has the meaning specified in Annex C.

“Regulatory Event” means with respect to any Person (i) the issuance to such Person of an injunction or administrative order to cease and desist from causing any violations, including, without limitation, any future violations of securities laws; (ii) suspension of such Person from association with any broker or dealer, investment company or investment adviser for a period of one year or more; (iii) a final finding by a court or regulator, including a self-regulatory organization, with respect to the making of a materially false statement or omission by such person; or (iv) the issuance with respect to such Person of a criminal indictment with respect to a felony related to or having a material adverse effect on such Person’s business of providing investment management services (an “Indictment Event”); provided that any indictment arising from practices that have become the subject of contemporaneous actions against multiple (i.e., three or more) unaffiliated investment advisers shall not constitute an Indictment Event for purposes of this clause (iv) unless (x) such indictment otherwise meets the requirements of this clause and (y) either (I) such indictment is an indictment of any Key Personnel or (II) more than 30 days have expired since the commencement of such indictment during which period such Person has failed to cure such indictment.  For purposes of the foregoing subclause (y), an indictment against no more than two such officers or employees (other than Key Personnel) of a corporate Person will be deemed to be cured if such Person removes responsibility for the management of the Collateral Assets from such officers or employees of such Person that are the subject of the applicable indictment within such 30-day period.

“Related Parties” means, with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.

“Relevant Affiliate” means any Affiliate of Borrower Parent other than (i) an Excluded Managed Fund and (ii) a special purpose entity subsidiary of Borrower Parent (a) which is subject to requirements substantially the same as the Special Purpose Entity Requirements (including the relevant provisions of the Limited Liability Company Agreement) in relation to the Borrower Parent and Borrower Parent’s Affiliates, (b) which is subject to requirements substantially the same as

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those applicable under the Sale Agreement for any purchases of financial assets by such special purpose entity from Borrower Parent or Borrower Parent’s Affiliates and (c) for which true sale and nonconsolidation opinions substantially the same as the opinions of counsel rendered in connection with the Loan Documents have been rendered in connection with purchases of financial assets by such special purpose entity from Borrower Parent or Borrower Parent’s Affiliates.

“Request for Credit Extension” means with respect to a Borrowing, conversion or continuation of Committed Loans, a Committed Loan Notice.

“Required Approvals” has the meaning specified in Section 10.01.

“Required Lenders” means, at any time, Lenders having Total Credit Exposures representing more than 50% of the Total Credit Exposures of all Lenders. The Total Credit Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.

“Required Ratings” has the meaning specified in Annex C.

“Responsible Officer” means with respect to the Company, any director, designated manager, authorized signatory, officer or any other Person who is authorized to act for the Company, solely for purposes of the delivery of incumbency certificates pursuant to Section 4.01, the secretary or any assistant secretary of the Company and, solely for purposes of notices given pursuant to Article II, any other officer or employee of the Company or the Investment Adviser so designated by any of the foregoing officers in a notice to the Administrative Agent. Any document delivered hereunder that is signed by a Responsible Officer of the Company shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of the Company and such Responsible Officer shall be conclusively presumed to have acted on behalf of the Company.

“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of the Company, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such capital stock or other Equity Interest, or on account of any return of capital to the Company’s stockholders, partners or members (or the equivalent Person thereof).

“Revolving Credit Exposure” means, as to any Lender at any time, the aggregate Outstanding Amount at such time of its Committed Loans.

“S&P” has the meaning specified in Annex C.

“S&P Rating” has the meaning specified in Annex C.

“Sale Agreement” means the Sale Agreement dated as of the Closing Date, among Borrower and Borrower Parent.

“Sanction(s)” means any international economic sanction administered or enforced by the United States Government (including without limitation, OFAC), the United Nations Security

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Council, the European Union, Her Majesty’s Treasury or other relevant sanctions authority in any jurisdiction in which the Borrower or any of its Affiliates (other than an Excluded Affiliate) operates or is organized or located (it being understood and agreed that any sanctions enforced by such other jurisdictions against the United States shall be excluded from the definition hereof).

“Same Day Funds” means immediately available funds in Dollars.

“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its principal functions.

“Second Closing Date” has the meaning specified in the preamble hereto.

“Second Fee Letter” means the letter agreement, dated as of the Second Closing Date, between the Company and the Administrative Agent.

“Second Lien Bank Loan” has the meaning specified in Annex C.

“Securities Act” means the United States Securities Act of 1933, as amended.

“Security Agreement” means the Security Agreement between the Administrative Agent and the Company, dated as of the Closing Date (as amended, restated, extended, supplemented or otherwise modified in writing from time to time).

“Senior Secured Bond” has the meaning specified in Annex C.

“Senior Subordinated Bond” has the meaning specified in Annex C.

“Senior Unsecured Bond” has the meaning specified in Annex C.

“Single Bid Asset” has the meaning set forth in Annex C.

“Special Purpose Entity Requirements” means the obligations of the Company to comply with the provisions set forth in Annex D.

“Special Situation Asset” has the meaning specified in Annex C.

“Structured Finance Security” has the meaning specified in Annex C.

“Subordinated Bond” has the meaning specified in Annex C.

“Swap Contract” means (a) any and all rate swap transactions, basis swaps, credit derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of any of the foregoing (including

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any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master Agreement, or any other similar master agreement relating to a similar transaction (any such master agreement, together with any related schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.

“Swap Termination Value” means, in respect of any one or more Swap Contracts, after taking into account the effect of any legally enforceable netting agreement relating to such Swap Contracts, (a) for any date on or after the date such Swap Contracts have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Swap Contracts, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Swap Contracts (which may include a Lender or any Affiliate of a Lender).

“Synthetic Lease Obligation” means the monetary obligation of a Person under (a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an agreement for the use or possession of property creating obligations that do not appear on the balance sheet of such Person but which, upon the insolvency or bankruptcy of such Person, would be characterized as the Indebtedness of such Person (without regard to accounting treatment).

“Taxes” means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Total Credit Exposure” means, as to any Lender at any time, the unused Commitments and Revolving Credit Exposure of such Lender at such time.

“Total Outstandings” means the aggregate Outstanding Amount of all Loans.

“Type” means, with respect to a Committed Loan, its character as a Base Rate Loan or a Eurocurrency Rate Loan.

“United States” and “U.S.” mean the United States of America.

“Upsize Date” means the date on which the Adminstrative Agent notifies the Borrower that each Lender has agreed in writing, in its sole discretion, to increase its Commitment as indicated on Schedule 2.01; provided that the Administrative Agent shall not deliver such notice prior to a request from the Borrower for such increase.

“U.S. Person” means any Person that is a “United States person” as defined in Section 7701(a)(30) of the Code.

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“U.S. Tax Compliance Certificate” has the meaning specified in Section 3.01(e)(ii)(B)(III).

“Zero Coupon Swap Rate” means, for any maturity, the value for such maturity of “USD-ISDA-Swap Rate” as defined in the 2006 ISDA Definitions as published by the International Swaps and Derivatives Association, Inc., or any successor publication (or if no value of “USD-ISDA-Swap Rate” is available for the relevant maturity, the value determined by linear interpolation between the closest maturities for which a value is available), as determined by the Administrative Agent in a commercially reasonable manner.

1.02Other Interpretive Provisions.

With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:

(a)The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise, (i) any definition of or reference to any agreement, instrument or other document (including any Organization Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, restated, supplemented or otherwise modified (subject to any restrictions on such amendments, restatements supplements or modifications set forth herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person’s successors and assigns, (iii) the words “hereto,” “herein,” “hereof” and “hereunder,” and words of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending, replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, and (vi) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights.

(b)In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including.”

(c)Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.

1.03Accounting Terms.

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All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the Audited Financial Statements, except as otherwise specifically prescribed herein.

1.04Rounding.

Any financial ratios required to be maintained by the Company pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

1.05[Reserved].

1.06[Reserved].

1.07Times of Day.

Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

1.08Business Day Convention.

Unless otherwise specified, in the event any time period or any date provided in this Agreement ends or falls on a day other than a Business Day, then such time period shall be deemed to end and such date shall be deemed to fall on the next succeeding Business Day, and performance herein may be made on such Business Day, with the same force and effect as if made on such other day.

ARTICLE II.

THE COMMITMENTS AND CREDIT EXTENSIONS

2.01Committed Loans.

Subject to the terms and conditions set forth herein, each Lender severally agrees to make loans (each such loan, a “Committed Loan”) to the Borrower in Dollars from time to time, on any Business Day during the Availability Period, in an aggregate amount not to exceed at any time outstanding the amount of such Lender’s Commitment; provided, however, that after giving effect to any Committed Borrowing, (i) the Total Outstandings shall not exceed the Aggregate Commitments and (ii) the Revolving Credit Exposure of any Lender shall not exceed such Lender’s Commitment. Within the limits of each Lender’s Commitment, and subject to the other terms and conditions hereof, the Borrower may borrow under this Section 2.01, prepay under Section 2.03,

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and reborrow under this Section 2.01. Committed Loans may be Base Rate Loans or Eurocurrency Rate Loans, as further provided herein.

2.02Borrowings, Conversions and Continuations of Committed Loans.

(a)Each Committed Borrowing, each conversion of Committed Loans from one Type to the other, and each continuation of Eurocurrency Rate Loans shall be made upon the Company’s irrevocable notice to the Administrative Agent and Collateral Administrator, which may be given in writing, including via email. Each such notice must be received by the Administrative Agent not later than 11:00 a.m. (a) three Business Days prior to the requested date of any Borrowing of, conversion to or continuation of any Eurocurrency Rate Loans and (b) on the date of the requested Borrowing of, conversion to or continuation of any Base Rate Loan or of any conversion of Eurocurrency Rate Loans to Base Rate Loans. Each written notice by the Company pursuant to this Section 2.02(a) must be confirmed promptly by delivery to the Administrative Agent of a written Committed Loan Notice, appropriately completed and signed by a Responsible Officer of the Company. Each Borrowing of, conversion to or continuation of Eurocurrency Rate Loans shall be in a principal amount of $250,000 (or $500,000, if there is more than one Lender at such time) or a whole multiple of $50,000 (or $100,000, if there is more than one Lender at such time) in excess thereof, or in the amount of the unused portion of the Commitments. Each Borrowing of or conversion to Base Rate Loans shall be in a principal amount of $250,000 (or $500,000, if there is more than one Lender at such time) or a whole multiple of $50,000 (or $100,000, if there is more than one Lender at such time) in excess thereof or in the amount of the unused portion of the Commitments. Each Committed Loan Notice shall specify (i) whether the Company is requesting a Committed Borrowing, a conversion of Committed Loans from one Type to the other, or a continuation of Eurocurrency Rate Loans or Base Rate Loans, (ii) the requested date of the Borrowing, conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Committed Loans to be borrowed, converted or continued, (iv) the Type of Committed Loans to be borrowed or continued or to which existing Committed Loans are to be converted and (v) if applicable, the duration of the Interest Period with respect thereto. If the Company fails to specify a Type of Committed Loan in a Committed Loan Notice or if the Company fails to give a timely notice requesting a conversion or continuation, then the applicable Committed Loans shall be made as, or converted to, Eurocurrency Rate Loans with an Interest Period of one month. If the Company requests a Borrowing of, conversion to, or continuation of Eurocurrency Rate Loans in any such Committed Loan Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.

(b)Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender of the amount of its Applicable Percentage of the applicable Committed Loans, and if no timely notice of a conversion or continuation is provided by the Company, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Eurocurrency Rate Loans as described in the preceding subsection. In the case of a Committed Borrowing, each Lender shall make the amount of its Committed Loan available to the Administrative Agent in Same Day Funds at the Administrative Agent’s Office for the applicable currency not later than 1:00 p.m., on the Business Day specified in the applicable Committed Loan Notice. Upon satisfaction of the applicable conditions set forth in Section 4.02 (and, if such

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Borrowing is the initial Credit Extension, Section 4.01), the Administrative Agent shall make all funds so received available to the Company in like funds as received by the Administrative Agent either by (i) crediting the account of the Borrower on the books of Bank of America with the amount of such funds or (ii) wire transfer of such funds, in each case in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower.

(c)Except as otherwise provided herein, a Eurocurrency Rate Loan may be continued or converted only on the last day of an Interest Period for such Eurocurrency Rate Loan unless the Borrower pays the amount due, if any, under Section 3.05 in connection therewith. During the existence of a Default, no Loans may be converted to or continued as Eurocurrency Rate Loans without the consent of the Required Lenders.

(d)The Administrative Agent shall promptly notify the Company and the Lenders of the interest rate applicable to any Interest Period for Eurocurrency Rate Loans upon determination of such interest rate. At any time that Base Rate Loans are outstanding, the Administrative Agent shall notify the Company and the Lenders of any change in the Prime Rate used in determining the Base Rate promptly following the public announcement of such change.

(e)After giving effect to all Committed Borrowings, all conversions of Committed Loans from one Type to the other, and all continuations of Committed Loans as the same Type, there shall not be more than fifteen Interest Periods in effect with respect to Committed Loans.

2.03Prepayments.

(a)The Borrower may, upon notice to the Administrative Agent, at any time or from time to time voluntarily prepay Committed Loans, in whole or in part without premium or penalty; provided that (i) such notice must be received by the Administrative Agent not later than 11:00 a.m. (A) three Business Days prior to any date of prepayment of Eurocurrency Rate Loans and (B) on the date of prepayment of Base Rate Loans; (ii) any prepayment of Eurocurrency Rate Loans shall be in a principal amount of $1,000,000 or a whole multiple of $100,000 in excess thereof; and (iii) any prepayment of Base Rate Loans shall be in a principal amount of $100,000 or a whole multiple of $100,000 in excess thereof or, in each case, if less, the entire principal amount thereof then outstanding. Each such notice shall be irrevocable and specify the date and amount of such prepayment and the Type(s) of Committed Loans to be prepaid and, if Eurocurrency Rate Loans are to be prepaid, the Interest Period(s) of such Loans. The Administrative Agent will promptly notify each Lender of its receipt of each such notice, and of the amount of such Lender’s Applicable Percentage of such prepayment. If such notice is given by the Borrower, the Borrower shall make such prepayment and the payment amount specified in such notice shall be due and payable on the date specified therein. Subject to Section 2.12, each such prepayment shall be applied to the Committed Loans of the Lenders in accordance with their respective Applicable Percentages.

(b)If the Administrative Agent notifies the Borrower at any time that a Borrowing Base Deficiency exists at such time, then the Borrower shall (i) give notice to the Administrative Agent and Lenders whether it intends to cure any Borrowing Base Deficiency by 3:00 p.m. on the Business Day following the date on which the Borrower is notified of such Borrowing Base Deficiency (unless Borrower has actually cured such Borrowing Base Deficiency by such time) and, if so, (ii)

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cure any Borrowing Base Deficiency by 3:00 p.m. on the second Business Day following the date on which a Borrowing Base Deficiency arose by either (A) repaying outstanding Loans or transferring additional Eligible Collateral Assets, Cash or Cash Equivalents to the Collateral Account so that the Borrowing Base will thereupon equal or exceed the Total Outstandings or (B) delivering to the Administrative Agent a written report showing a projected cure of any Borrowing Base Deficiency based on actions described in clause (A), if any, and pending purchases and sales of Collateral Assets as of the date of such report, provided that such report shall (1) be satisfactory to the Administrative Agent, (2) give effect to all projected purchases of Collateral Assets and other financial assets by the Borrower and account in a manner satisfactory to the Administrative Agent for any change in the market value of any such Collateral Assets and (3) give effect to sales of Collateral Assets only if such sales are (x) committed sales as of the date of such report, (y) sales to Approved Dealers and (z) reasonably expected by the Administrative Agent to be fully settled within 30 days of the date of such report. Notwithstanding Section 7.07, the Borrower Parent may at its option, but shall not in any way be obligated to, contribute Eligible Collateral Assets, Cash or Cash Equivalents at any time to the Borrower to cure a Borrowing Base Deficiency or for any other reason.

(c)Any prepayment of any Loan shall be accompanied by all accrued and unpaid interest, amounts owing under Section 2.06 in respect of the amount prepaid and in the case of any Eurocurrency Rate Loan any additional amounts required pursuant to Section 3.05.

2.04Termination or Reduction of Commitments.

The Company may, at its discretion, upon written notice to the Administrative Agent, terminate the Aggregate Commitments, or from time to time permanently reduce the Aggregate Commitments; provided that (i) any such notice shall be received by the Administrative Agent not later than 11:00 a.m. five Business Days prior to the date of termination or reduction, (ii) any such partial reduction shall be in an aggregate amount of at least $1,000,000 or, if less, the entire Aggregate Commitments and (iii) the Company shall not terminate or reduce the Aggregate Commitments if, after giving effect thereto and to any concurrent prepayments hereunder, the Total Outstandings would exceed the Aggregate Commitments. The Borrower will be required to pay the Makewhole Fee, applicable amounts under Sections 3.01 and 3.05 and other amounts applicable for the terminated portion of the Facility; provided that a Makewhole Fee will not be payable in the event that Borrower exercises the right to terminate or reduce the Facility described in this Section 2.04 following the assertion of claims for additional amounts under Sections 3.01 and 3.04 that exceed an amount equal to 0.10% per annum times the Aggregate Commitments. The Administrative Agent will promptly notify the Lenders of any such notice of termination or reduction of the Aggregate Commitments. Any reduction of the Aggregate Commitments shall be applied to the Commitment of each Lender according to its Applicable Percentage. All fees accrued until the effective date of any termination of the Aggregate Commitments shall be paid on the effective date of such termination.

2.05Repayment of Loans.

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The Borrower shall repay to the Lenders on the Maturity Date the aggregate principal amount of Committed Loans made to the Borrower outstanding on such date and shall repay Loans as provided in Section 2.10(b).

2.06Interest.

(a)Subject to the provisions of subsection (b) below, (i) each Eurocurrency Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest Period at a rate per annum equal to the Eurocurrency Rate for such Interest Period plus the Applicable Rate and (ii) each Base Rate Loan shall bear interest on the Outstanding Amount thereof from the applicable borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate minus 1.00%.

(b)(i)    If any amount of principal of any Loan is not paid when due (without giving effect to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

(ii)If any amount (other than principal of any Loan) payable by the Borrower under any Loan Document is not paid when due (without giving effect to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then upon the request of the Required Lenders, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws and shall continue to bear interest at such rate until but excluding the date on which such Event of Default is cured or waived.

(iii)Upon the request of the Required Lenders, while any Event of Default exists (other than as set forth in clauses (b)(i) and (b)(ii) above), the Borrower shall pay interest on the principal amount of all outstanding Obligations hereunder at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent permitted by applicable Laws.

(iv)Accrued and unpaid interest on past due amounts (including interest on past due interest) shall be due and payable upon demand.

(c)Interest on each Loan shall be due and payable in arrears on each Interest Payment Date applicable thereto and at such other times as may be specified herein. Interest hereunder shall be due and payable in accordance with the terms hereof before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.

2.07Fees.

(a)    Commitment Fee. Subject to Section 2.12(a)(iii), the Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage, a commitment fee in Dollars equal to (i) the actual daily amount by which the Aggregate Commitments exceed the Outstanding Amount of Committed Loans times (ii) the Commitment Fee Rate. The commitment fee shall accrue at all times during the Availability Period, including at any

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time during which one or more of the conditions in Article IV is not met, and shall be due and payable quarterly in arrears on the last Business Day of each March, June, September and December, commencing with the first such date to occur after the Closing Date, and on the last day of the Availability Period. The commitment fee shall be calculated quarterly in arrears and if there is any change in the Commitment Fee Rate during any quarter, the actual daily amount shall be computed and multiplied by the Commitment Fee Rate separately for each period during such quarter that such Commitment Fee Rate was in effect.

(b)Makewhole Fee. Subject to Section 2.12(a)(iii), if the Aggregate Commitments are terminated in whole or in part pursuant to Sections 2.04 prior to June 18, 2017, then Borrower shall pay to the Administrative Agent for the account of each Lender in accordance with its Applicable Percentage a fee (the “Makewhole Fee”) equal to the sum of the present values of all future spread amounts that would have been payable in respect of the Aggregate Commitments (or terminated portion thereof) during the period from the termination date through June 18, 2017 assuming that the Outstanding Amount is equal to the Aggregate Commitments (or terminated portion thereof) and the Applicable Rate is equal to 0.75% (discounting each such spread amount to its present value based on the Zero Coupon Swap Rate as of the date of determination for a maturity equal to the period of time from the date of determination to the date on which such spread amount would have been paid).

(c)Other Fees.(i) The Company shall pay to the Arranger and the Administrative Agent for their own respective accounts, in Dollars, fees in the amounts and at the times specified in each Fee Letter. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

(ii)The Company shall pay to the Lenders, in Dollars, such fees as shall have been separately agreed upon in writing in the amounts and at the times so specified. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.

2.08Computation of Interest and Fees.

All computations of interest for Base Rate Loans (including Base Rate Loans determined by reference to the Eurocurrency Rate) shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year). Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid, provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.10(a), bear interest for one day. Each determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent manifest error.

2.09Evidence of Debt.

The Credit Extensions made by each Lender shall be evidenced by one or more accounts or records maintained by such Lender and by the Administrative Agent in the ordinary course of

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business in accordance with its usual practice. The accounts or records maintained by the Administrative Agent and each Lender shall be conclusive absent manifest error of the amount of the Credit Extensions made by the Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of manifest error. Upon the request of any Lender to the Borrower made through the Administrative Agent, the Borrower shall execute and deliver to such Lender (through the Administrative Agent) a Note, which shall evidence such Lender’s Loans to the Borrower in addition to such accounts or records. Each Lender may attach schedules to a Note and endorse thereon the date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.

2.10Payments Generally; Administrative Agent’s Clawback.

(a)General. All payments to be made by the Borrower shall be made free and clear of and without condition or deduction for any counterclaim, defense, recoupment or setoff. All payments by the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed, at the applicable Administrative Agent’s Office in Dollars and in Same Day Funds not later than 2:00 p.m. on the date specified herein. The Administrative Agent may require that any payments due under this Agreement be made in the United States. The Administrative Agent will promptly distribute to each Lender its Applicable Percentage (or other applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office. All payments received by the Administrative Agent after 2:00 p.m shall in each case be deemed received on the next following Business Day and any applicable interest or fee shall continue to accrue. If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be; provided that this sentence shall not apply to payments made on the Maturity Date without giving effect to the proviso in the definition of such term.

(b)(i) Funding by Lenders; Presumption by Administrative Agent. Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Committed Borrowing of Eurocurrency Rate Loans (or, in the case of any Committed Borrowing of Base Rate Loans, prior to 12:00 noon on the date of such Committed Borrowing) that such Lender will not make available to the Administrative Agent such Lender’s share of such Committed Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with Section 2.02 (or, in the case of a Committed Borrowing of Base Rate Loans, that such Lender has made such share available in accordance with and at the time required by Section 2.02) and may, in reliance upon such assumption, make available to Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Committed Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount in Same Day Funds with interest thereon, for each day from and including

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the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (A) in the case of a payment to be made by such Lender, the Overnight Rate, plus any administrative, processing or similar fees customarily charged by the Administrative Agent in connection with the foregoing, and (B) in the case of a payment to be made by the Borrower, the interest rate applicable to Base Rate Loans. If the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays its share of the applicable Committed Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s Committed Loan included in such Committed Borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall have failed to make such payment to the Administrative Agent.

(ii)Payments by Borrower; Presumptions by Administrative Agent. Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender in Same Day Funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Overnight Rate.

A notice of the Administrative Agent to any Lender or Borrower with respect to any amount owing under this subsection (b) shall be conclusive, absent manifest error.

(c)Failure to Satisfy Conditions Precedent. If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender to the Borrower as provided in the foregoing provisions of this Article II, and such funds are not made available to the Borrower by the Administrative Agent because the conditions to the applicable Credit Extension set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the Administrative Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.

(d)Obligations of Lenders Several. The obligations of the Lenders hereunder to make Committed Loans and to make payments pursuant to Section 10.04(c) are several and not joint. The failure of any Lender to make any Committed Loan, to fund any such participation or to make any payment under Section 10.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its Committed Loan, to purchase its participation or to make its payment under Section 10.04(c).

(e)Funding Source. Nothing herein shall be deemed to obligate any Lender to obtain the funds for any Loan in any particular place or manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or manner.

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2.11Sharing of Payments by Lenders.

If any Lender shall, by exercising any right of setoff or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of the Committed Loans made by it resulting in such Lender’s receiving payment of a proportion of the aggregate amount of such Committed Loans or participations and accrued interest thereon greater than its prorata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Committed Loans, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Committed Loans and other amounts owing them, provided that:

(i)if any such participations or subparticipations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations or subparticipations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

(ii)the provisions of this Section shall not be construed to apply to (x) any payment made by or on behalf of Borrower pursuant to and in accordance with the express terms of this Agreement (including the application of funds arising from the existence of a Defaulting Lender) or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Committed Loans to any assignee or participant, other than an assignment to the Company (as to which the provisions of this Section shall apply).

The Company consents to the foregoing and agrees, to the extent it may effectively do so under applicable law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against the Company’s rights of setoff and counterclaim with respect to such participation as fully as if such Lender were a direct creditor of the Company in the amount of such participation.

2.12Defaulting Lenders.

(a)Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender becomes a Defaulting Lender, then, until such time as that Lender is no longer a Defaulting Lender, to the extent permitted by applicable Law:

(i)Waivers and Amendments. Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Agreement shall be restricted as set forth in the definition of “Required Lenders” and Section 10.01.

(ii)Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VIII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.08 shall be applied at such time or times as may be determined by the Administrative Agent as

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follows: first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder; second, as the Company may request (so long as no Default exists and is continuing), to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; third, if so determined by the Administrative Agent and the Company, to be held in a deposit account and released pro rata in order to satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement; fourth, to the payment of any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; fifth, so long as no Default exists or is continuing, to the payment of any amounts owing to the Company as a result of any judgment of a court of competent jurisdiction obtained by the Company against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; and sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully funded its appropriate share, such payment shall be applied solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of such Defaulting Lender until such time as all Loans are held by the Lenders pro rata in accordance with the Commitments hereunder. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.

(iii)Certain Fees. No Defaulting Lender shall be entitled to receive any fee payable under Section 2.07(a) or 2.07(b) for any period during which that Lender is a Defaulting Lender and the Company shall not be required to pay any such fee that otherwise would have been required to have been paid to such Defaulting Lender.

(b)Defaulting Lender Cure. If the Company and the Administrative Agent agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein, that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the Committed Loans to be held on a pro rata basis by the Lenders in accordance with their Applicable Percentages, whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Company while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

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ARTICLE III.

TAXES, YIELD PROTECTION AND ILLEGALITY

3.01Taxes.

(a)Payments Free of Taxes; Obligation to Withhold; Payments on Account of Taxes.

(i)Any and all payments by or on account of any obligation of the Company under any Loan Document shall be made without deduction or withholding for any Taxes, except as required by applicable Laws. If any applicable Laws (as determined in the good faith discretion of the applicable withholding agent) require the deduction or withholding of any Tax from any such payment by the Administrative Agent or the Company, then the Administrative Agent or the Company shall be entitled to make such deduction or withholding, upon the basis of the information and documentation to be delivered pursuant to subsection (e) below.

(ii)If the Company or the Administrative Agent shall be required by the Code to withhold or deduct any Taxes, including both United States Federal backup withholding and withholding Taxes, from any payment under any Loan Document, then (A) the Administrative Agent shall withhold or make such deductions as are determined by the Administrative Agent to be required based upon the information and documentation it has received pursuant to subsection (e) below, (B) the Administrative Agent shall timely pay the full amount withheld or deducted to the relevant Governmental Authority in accordance with the Code, and (C) to the extent that the withholding or deduction is made on account of Indemnified Taxes, the sum payable by the Company shall be increased as necessary so that after any required withholding or the making of all required deductions (including deductions applicable to additional sums payable under this Section 3.01) the applicable Recipient receives an amount equal to the sum it would have received had no such withholding or deduction been made.

(iii)If the Company or the Administrative Agent shall be required by any applicable Laws other than the Code to withhold or deduct any Taxes from any payment under any Loan Document, then (A) the Company or the Administrative Agent, as required by such Laws, shall withhold or make such deductions as are determined by it to be required based upon the information and documentation it has received pursuant to subsection (e) below, (B) the Company or the Administrative Agent, to the extent required by such Laws, shall timely pay the full amount withheld or deducted to the relevant Governmental Authority in accordance with such Laws, and (C) to the extent that the withholding or deduction is made on account of Indemnified Taxes, the sum payable by the Company shall be increased as necessary so that after any required withholding or the making of all required deductions (including deductions applicable to additional sums payable under this Section 3.01) the applicable Recipient receives an amount equal to the sum it would have received had no such withholding or deduction been made.

(b)Payment of Other Taxes by the Company. Without limiting the provisions of subsection (a) above, the Company shall timely pay to the relevant Governmental Authority in

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accordance with applicable Law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

(c)Tax Indemnifications. (i)  The Company shall, and does hereby, indemnify each Recipient, and shall make payment in respect thereof within 10 days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 3.01) payable or paid by such Recipient or required to be withheld or deducted from a payment to such Recipient, and reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Company by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(ii)Each Lender shall, and does hereby, severally indemnify, and shall make payment in respect thereof within 10 days after demand therefor, (x) the Administrative Agent against any Indemnified Taxes attributable to such Lender (but only to the extent that the Company has not already indemnified the Administrative Agent for such Indemnified Taxes and without limiting the obligation of the Company to do so), (y) the Administrative Agent and the Company, as applicable, against any Taxes attributable to such Lender’s failure to comply with the provisions of Section 10.06(d) relating to the maintenance of a Participant Register and (z) the Administrative Agent and the Company, as applicable, against any Excluded Taxes attributable to such Lender, in each case, that are payable or paid by the Administrative Agent or the Company in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender, as the case may be, under this Agreement or any other Loan Document against any amount due to the Administrative Agent under this clause (ii).

(d)Evidence of Payments. Upon request by the Company or the Administrative Agent, as the case may be, after any payment of Taxes by the Company or by the Administrative Agent to a Governmental Authority as provided in this Section 3.01, the Company shall deliver to the Administrative Agent or the Administrative Agent shall deliver to the Company, as the case may be, the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of any return required by Laws to report such payment or other evidence of such payment reasonably satisfactory to the Company or the Administrative Agent, as the case may be.

(e)Status of Lenders; Tax Documentation. (i) Any Recipient that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Loan Document shall deliver to the Company and the Administrative Agent, at the time or times reasonably requested by the Company or the Administrative Agent, such properly completed and executed

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documentation prescribed by applicable Law or the taxing authorities of a jurisdiction pursuant to such applicable Law or reasonably requested by the Company or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Recipient, if reasonably requested by the Company or the Administrative Agent, shall deliver such other documentation prescribed by applicable Law or reasonably requested by the Company or the Administrative Agent as will enable the Company or the Administrative Agent to determine whether or not such Recipient is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation either (A) set forth in Section 3.01(e)(ii)(A), Section 3.01(e)(ii)(B), Section 3.01(e)(ii)(D) or Section 3.01(e)(iii), or (B) required by applicable Law other than the Code or the taxing authorities of a jurisdiction pursuant to such applicable Law to comply with the requirements for exemption or reduction of withholding Tax in that jurisdiction) shall not be required if in the Recipient’s reasonable judgment such completion, execution or submission would subject such Recipient to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Recipient.

(ii)Without limiting the generality of the foregoing,

(A)any Recipient that is a U.S. Person shall deliver to the Company and the Administrative Agent on or prior to the date on which such Recipient becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of the Company or the Administrative Agent), executed originals of IRS Form W‑9 certifying that such Recipient is exempt from U.S. federal backup withholding Tax;

(B)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Company and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of the Company or the Administrative Agent), whichever of the following is applicable:

(I)    in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Loan Document, executed originals of IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “interest” article of such tax treaty and (y) with respect to any other applicable payments under any Loan Document, IRS Form W-8BEN establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the “business profits” or “other income” article of such tax treaty;

(II)        executed originals of IRS Form W-8ECI;

(III)    in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate

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substantially in the form of Exhibit E-1 to the effect that such Foreign Lender is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10-percent shareholder” of the Borrower Parent within the meaning of Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed originals of IRS Form W-8BEN; or

(IV)    to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN, a U.S. Tax Compliance Certificate substantially in the form of Exhibit E-2 or Exhibit E-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit E-4 on behalf of each such direct and indirect partner;

(C)any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Company and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of the Company or the Administrative Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in U.S. federal withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable law to permit the Company or the Administrative Agent to determine the withholding or deduction required to be made; and

(D)if a payment made to a Recipient under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Recipient were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Recipient shall deliver to the Company and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Company or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Company or the Administrative Agent as may be necessary for the Company and the Administrative Agent to comply with their obligations under FATCA and to determine that such Recipient has complied with such Recipient’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (D), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

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(iii)Each Recipient agrees that if any form or certification it previously delivered pursuant to this Section 3.01 expires or becomes obsolete or inaccurate in any respect, or if a successor version of such form or certification is published, it shall update such form or certification or promptly notify the Company and the Administrative Agent in writing of its legal inability to do so.

(iv)Borrower shall deliver to the Administrative Agent on or prior to the Closing Date an executed original of IRS Form W-9. If such form becomes obsolete or inaccurate in any respect, or if a successor version of such form or certification is published, Borrower shall update such form or promptly notify the Administrative Agent in writing of its legal inability to do so.

(f)Treatment of Certain Refunds. Unless required by applicable Laws, at no time shall the Administrative Agent have any obligation to file for or otherwise pursue on behalf of a Lender, or have any obligation to pay to any Lender, any refund of Taxes withheld or deducted from funds paid for the account of such Lender, as the case may be. If any Recipient determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified by the Company or with respect to which the Company has paid additional amounts pursuant to this Section 3.01, it shall pay to the Company an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by the Company under this Section 3.01 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) incurred by such Recipient, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund), provided that the Company, upon the request of the Recipient, agrees to repay the amount paid over to the Company (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Recipient within thirty days of such request in the event the Recipient is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this subsection, in no event will the applicable Recipient be required to pay any amount to the Company pursuant to this subsection the payment of which would place the Recipient in a less favorable net after-Tax position than such Recipient would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This subsection shall not be construed to require any Recipient to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the Company or any other Person.

(g)Survival. Each party’s obligations under this Section 3.01 shall survive the resignation or replacement of the Administrative Agent or any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all other Obligations.

3.02Illegality.

If any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to the Eurocurrency Rate, or to determine or charge interest rates based upon the Eurocurrency Rate, or any Governmental Authority

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has imposed material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars in the applicable interbank market, then, on notice thereof by such Lender to the Company through the Administrative Agent, (i) any obligation of such Lender to make or continue Eurocurrency Rate Loans or to convert Base Rate Loans to Eurocurrency Rate Loans, shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or maintaining Base Rate Loans the interest rate on which is determined by reference to the Eurocurrency Rate component of the Base Rate, the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Eurocurrency Rate component of the Base Rate, in each case until such Lender notifies the Administrative Agent and the Company that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, (x) the Borrower shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable and such Loans are denominated in Dollars, request a conversion of all Eurocurrency Rate Loans of such Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Eurocurrency Rate component of the Base Rate), either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurocurrency Rate Loans to such day, or as soon as possible (notwithstanding Section 2.02(c), if such Lender may not lawfully continue to maintain such Eurocurrency Rate Loans and (y) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the Eurocurrency Rate, the Administrative Agent shall during the period of such suspension compute the Base Rate applicable to such Lender without reference to the Eurocurrency Rate component thereof until the Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon the Eurocurrency Rate. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted and any amounts due pursuant to Section 3.05.

3.03Inability to Determine Rates.

If in connection with any request for a Eurocurrency Rate Loan or a conversion to or continuation thereof, (a) (i) the Administrative Agent determines that (i) deposits are not being offered to banks in the applicable offshore interbank market for Dollars for the applicable amount and Interest Period of such Eurocurrency Rate Loan, or (ii) adequate and reasonable means do not exist for determining the Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan or in connection with an existing or proposed Base Rate Loan, (in each case with respect to clause (a) above, “Impacted Loans”), or (b) the Administrative Agent or the Required Lenders  determine that for any reason the Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan does not adequately and fairly reflect the cost to such Lenders of funding such Eurocurrency Rate Loan, the Administrative Agent will promptly so notify the Company and each Lender. Thereafter, (x) the obligation of the Lenders to make or maintain Eurocurrency Rate Loans in Dollars shall be suspended, (to the extent of the affected Eurocurrency Rate Loans or Interest Periods), and (y) in the event of a determination described in the preceding sentence with respect to the Eurocurrency Rate component of the Base Rate, the utilization of the Eurocurrency Rate component in determining the Base Rate shall be suspended, in each case until the Administrative Agent (upon the instruction of the Required

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Lenders) revokes such notice. Upon receipt of such notice, the Company may revoke any pending request for a Borrowing of, conversion to or continuation of Eurocurrency Rate Loans in Dollars (to the extent of the affected Eurocurrency Rate Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request for a Committed Borrowing of Base Rate Loans in the amount specified therein.

Notwithstanding the foregoing, if the Administrative Agent has made the determination described in this Section, the Administrative Agent, in consultation with the Borrower and the Required Lenders, may establish an alternative interest rate for the Impacted Loans, in which case, such alternative rate of interest shall apply with respect to the Impacted Loans until (1) the Administrative Agent revokes the notice delivered with respect to the Impacted Loans under clause (a) of the first sentence of this section, (2) the Administrative Agent or the Required Lenders notify the Administrative Agent and the Borrower that such alternative interest rate does not adequately and fairly reflect the cost to such Lenders of funding the Impacted Loans, or (3) any Lender determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for such Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to such alternative rate of interest or to determine or charge interest rates based upon such rate or any Governmental Authority has imposed material restrictions on the authority of such Lender to do any of the foregoing and provides the Administrative Agent and the Borrower written notice thereof.

3.04Increased Costs; Reserves on Eurocurrency Rate Loans.

(a)Increased Costs Generally. If any Change in Law shall:

(i)impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender (except any reserve requirement contemplated by Section 3.04(e), other than as set forth below);

(ii)subject any Recipient to any Taxes (other than (A) Indemnified Taxes, (B) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of credit, commitments, or other obligations, or its deposits, reserves, other liabilities or capital attributable thereto; or

(iii)impose on any Lender or the London interbank market any other condition, cost or expense affecting this Agreement or Eurocurrency Rate Loans made by such Lender or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making, converting to, continuing or maintaining any Loan the interest on which is determined by reference to the Eurocurrency Rate (or of maintaining its obligation to make any such Loan), or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of principal, interest or any other amount) then, upon request of such Lender, the Company will pay to such Lender,

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such additional amount or amounts as will compensate such Lender, for such additional costs incurred or reduction suffered.

(b)Capital Requirements. If any Lender determines that any Change in Law affecting such Lender or any Lending Office of such Lender or such Lender’s holding company, if any, regarding capital or liquidity requirements has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by such Lender to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy), then from time to time the Company will pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

(c)Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as the case may be, as specified in subsection (a) or (b) of this Section and delivered to the Company shall be conclusive absent manifest error. The Company shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

(d)Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to the foregoing provisions of this Section 3.04 shall not constitute a waiver of such Lender’s right to demand such compensation, provided that the Borrower shall not be required to compensate a Lender pursuant to the foregoing provisions of this Section for any increased costs incurred or reductions suffered more than 180 days prior to the date that such Lender notifies the Company of the Change in Law giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof).

(e)Additional Reserve Requirements. The Company shall pay to each Lender, (i) as long as such Lender shall be required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency funds or deposits (currently known as “Eurocurrency liabilities”), additional interest on the unpaid principal amount of each Eurocurrency Rate Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive absent manifest error), and (ii) as long as such Lender shall be required to comply with any reserve ratio requirement or analogous requirement of any other central banking or financial regulatory authority imposed in respect of the maintenance of the Commitments or the funding of the Eurocurrency Rate Loans, such additional costs (expressed as a percentage per annum and rounded upwards, if necessary, to the nearest five decimal places) equal to the actual costs allocated to such Commitment or Loan by such Lender (as determined by such Lender in good faith, which determination shall be conclusive absent manifest error), which in each caseshall be due and payable on each date on which interest is payable on such Loan, provided the Company shall have received at least 10 days’ prior notice (with a copy to the Administrative Agent) of such additional interest or costs from such Lender

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which notice will include the amount of such interest or costs, the methodology for the calculation and the calculation thereof. If a Lender fails to give notice 10 days prior to the relevant Interest Payment Date, such additional interest or costs shall be due and payable 10 days from receipt of such notice.

3.05Compensation for Losses.

Upon demand of any Lender (with a copy to the Administrative Agent) from time to time, the Company shall promptly compensate such Lender for and hold such Lender harmless from any loss, cost or expense incurred by it as a result of:

(a)any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day other than the last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);

(b)any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Company or the Borrower unless such notice is rescinded in accordance with the terms hereof; or

(cany assignment of a Eurocurrency Rate Loan on a day other than the last day of the Interest Period therefor as a result of a request by the Company pursuant to Section 10.13;

including, in each case, any loss or expense arising from the liquidation or reemployment of funds obtained by it to maintain such Loan, from fees payable to terminate the deposits from which such funds were obtained (excluding lost profits). The Company shall also pay any customary administrative fees charged by such Lender in connection with the foregoing.

For purposes of calculating amounts payable by the Company (or the Borrower) to the Lenders under this Section 3.05, each Lender shall be deemed to have funded each Eurocurrency Rate Loan made by it at the Eurocurrency Rate for such Loan by a matching deposit or other borrowing in the offshore interbank market for Dollars for a comparable amount and for a comparable period, whether or not such Eurocurrency Rate Loan was in fact so funded.

3.06Mitigation Obligations; Replacement of Lenders.

(a)Designation of a Different Lending Office. If any Lender requests compensation under Section 3.04, or requires the Borrower to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, then at the request of the Company such Lender shall use reasonable efforts to designate a different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and (ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would not otherwise be

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disadvantageous to such Lender. The Company hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b)    Replacement of Lenders. If any Lender requests compensation under Section 3.04 or if the Borrower is required to pay any Indemnified Taxes or additional amounts to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 and, in each case, such Lender has declined or is unable to designate a different lending office in accordance with Section 3.06(a), the Company may replace such Lender in accordance with Section 10.13.

3.07Survival.

All obligations of the Company under this Article III shall survive termination of the Aggregate Commitments, repayment of all other Obligations hereunder, and resignation of the Administrative Agent.

ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

4.01Conditions of Initial Credit Extension.

The obligation of each Lender to make its initial Credit Extension hereunder is subject to satisfaction of the following conditions precedent:

(a)The Administrative Agent’s receipt of the following, each of which shall be originals or telecopies (followed promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the Company, each dated the Closing Date (or, in the case of certificates of governmental officials, a reasonably recent date before the Closing Date) and each in form and substance satisfactory to the Administrative Agent and each of the Lenders:

(i)executed counterparts of this Agreement, the Security Agreement, the Collateral Administration Agreement, the Sale Agreement and the Investment Advisory Agreement, sufficient in number for distribution to the Administrative Agent, each Lender and the Company;

(ii)Notes executed by the Borrower in favor of each Lender requesting Notes;

(iii)such certificates of resolutions or other action, incumbency certificates and/or other certificates of a Responsible Officer of the Company as the Administrative Agent may require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to which the Company is a party;

(iv)such documents and certifications as the Administrative Agent may reasonably require to evidence that the Company is duly organized, and that the Borrower is validly existing, in good standing and qualified to engage in business in Delaware;

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(v)a favorable opinion of counsel to the Company, addressed to the Administrative Agent and each Lender, as to the matters concerning the Company, the Investment Adviser and the Loan Documents as the Required Lenders may reasonably request;

(vi)a certificate signed by a Responsible Officer of the Company certifying (A) that the conditions specified in Sections 4.02(a) and (b) have been satisfied and (B) that there has been no event or circumstance since November 14, 2013 that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect (other than a Collateral Value Condition); and

(vii)such other assurances, certificates, documents, consents or opinions as the Administrative Agent or the Required Lenders reasonably may require.

(b)The Administrative Agent shall have confirmed that the Net Asset Value of Borrower is at least equal to $25,000,000.

(c)Any fees required to be paid on or before the Closing Date that have been invoiced shall have been paid.

(d)Unless waived by the Administrative Agent, the Company shall have paid all fees, charges and disbursements of counsel to the Administrative Agent (directly to such counsel if requested by the Administrative Agent) to the extent invoiced prior to or on the Closing Date, plus such additional amounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between the Company and the Administrative Agent); provided, however, that such fees, charges and disbursements shall only be due and payable to the extent provided pursuant to Section 10.04.

Without limiting the generality of the provisions of the last paragraph of Section 9.03, for purposes of determining compliance with the conditions specified in this Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

4.02Conditions to all Credit Extensions.

The obligation of each Lender to honor any Request for Credit Extension is subject to the following conditions precedent:

(a)The representations and warranties of (i) the Borrower contained in Article V and (ii) the Company contained in each other Loan Document, or which are contained in any document furnished at any time under or in connection herewith or therewith, (I) to the extent already qualified with respect to “material” matters or “Material Adverse Effect”, shall be true and correct on and as of the date of such Credit Extension and (II) to the extent not already qualified with respect to

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“material” matters or “Material Adverse Effect”, shall be true and correct in all material respects on and as of the date of such Credit Extension, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they shall be true and correct (in all material respects, as applicable) as of such earlier date, and except that for purposes of this Section 4.02, the representations and warranties contained in subsections (a) and (b) of Section 5.05 shall be deemed to refer to the most recent statements furnished pursuant to subsections (a) and (b), respectively, of Section 6.01.

(b)No Default shall exist, or would result from such proposed Credit Extension or from the application of the proceeds thereof.

(c)The Administrative Agent and Collateral Administrator shall have received a Request for Credit Extension in accordance with the requirements hereof.

(d)The Administrative Agent and Collateral Administrator shall have received a Borrower Certification in accordance with the requirements hereof.

(e)No Borrowing Base Deficiency shall exist on the date of such Advance or would arise after giving effect to the relevant Advance.

(f)After giving effect to the proposed Credit Extension, the Total Outstandings would not exceed the Aggregate Commitments.

(g)In the case of the first Credit Extension following the Second Closing Date:

(i)The Administrative Agent’s receipt of the following, each of which shall be originals or telecopies (followed promptly by originals) unless otherwise specified, each properly executed by a Responsible Officer of the Company, each dated the Second Closing Date (or, in the case of certificates of governmental officials, a reasonably recent date before the Closing Date) and each in form and substance satisfactory to the Administrative Agent and each of the Lenders:

(A)executed counterparts of this Agreement sufficient in number for distribution to the Administrative Agent, each Lender and the Company;

(B)such certificates of resolutions or other action, incumbency certificates and/or other certificates of a Responsible Officer of the Company as the Administrative Agent may require evidencing the identity, authority and capacity of each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to which the Company is a party;

(C)such documents and certifications as the Administrative Agent may reasonably require to evidence that the Company is duly organized, and that the Company is validly existing, in good standing and qualified to engage in business in Delaware;

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(D)a favorable opinion of counsel to the Company, addressed to the Administrative Agent and each Lender, as to the matters concerning the Company and the Loan Documents as the Required Lenders may reasonably request;

(E)a certificate signed by a Responsible Officer of the Company certifying (A) that the conditions specified in Sections 4.02(a) and (b) have been satisfied and (B) that there has been no event or circumstance since December 31, 2014 that has had or could be reasonably expected to have, either individually or in the aggregate, a Material Adverse Effect (other than a Collateral Value Condition);

(F)such other assurances, certificates, documents, consents or opinions as the Administrative Agent or the Required Lenders reasonably may require.

(ii)Any fees required to be paid on or before the Second Closing Date that have been invoiced shall have been paid.

(iii)Unless waived by the Administrative Agent, the Company shall have paid all fees, charges and disbursements of counsel to the Administrative Agent (directly to such counsel if requested by the Administrative Agent) to the extent invoiced prior to or on the Closing Date, plus such additional invoiced amounts of such fees, charges and disbursements as shall constitute its reasonable estimate of such fees, charges and disbursements incurred or to be incurred by it through the closing proceedings (provided that such estimate shall not thereafter preclude a final settling of accounts between the Company and the Administrative Agent); provided, however, that such fees, charges and disbursements shall only be due and payable to the extent provided pursuant to Section 10.04.

Each Request for Credit Extension submitted by the Company shall be deemed to be a representation and warranty that the conditions specified in Sections 4.02(a) and (b) have been satisfied on and as of the date of the applicable Credit Extension.

ARTICLE V.

REPRESENTATIONS AND WARRANTIES

The Borrower represents and warrants to the Administrative Agent and the Lenders that:

5.01Existence, Qualification and Power.

The Company (a) is duly organized, validly existing and, as applicable, in good standing under the Laws of the jurisdiction of its incorporation or organization, (b) has all requisite power and authority to (i) own or lease its assets and carry on its business in which it is currently engaged and (ii) execute, deliver and perform its obligations under the Loan Documents to which it is a party, and (c) is duly qualified and is licensed and, as applicable, in good standing under the Laws of each jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification or license; except in each case referred to in clause (b)(i) or (c), to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

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5.02Authorization; No Contravention.

The execution, delivery and performance by the Company of each Loan Document to which the Company is party, have been duly authorized by all necessary corporate or other organizational action, and do not and will not (a) violate the terms of any of the Company’s Organization Documents; (b) result in any material breach or contravention of, or the creation of any Lien (other than a Permitted Lien) under, or require any payment to be made under (i) any Contractual Obligation to which the Company is a party or (ii) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which the Company or its property is subject; or (c) violate any Law in any material respect.

5.03Governmental Authorization; Other Consents.

No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, the Company of this Agreement or any other Loan Document except (a) for recordings and filings in connection with the Liens granted to the Administrative Agent under the Security Agreement, (b) those obtained or made on or prior to the Second Closing Date and (c) those which, if not obtained or made, would not reasonably be expected to have, either individually or in the aggregate, a Material Adverse Effect.

5.04Binding Effect.

This Agreement has been, and each other Loan Document to which the Company is a party, when delivered hereunder, will have been, duly executed and delivered by the Company. This Agreement constitutes, and each other Loan Document to which the Company is a party when so delivered, and when executed and delivered by the other parties thereto, will constitute, a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as such enforceability may be limited by Debtor Relief Laws or other Laws affecting creditors’ rights generally and by general principles of equity, regardless of whether considered in a proceeding in equity or at Law.

5.05Financial Statements; No Material Adverse Effect.

(a)The Audited Financial Statements (beginning with the fiscal year ended December 31, 2013) (i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; (ii) fairly present in all material respects the financial condition of Borrower Parent as of the date thereof and its results of operations for the period covered thereby in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein; and (iii) show all material indebtedness and other liabilities, direct or contingent, of Borrower Parent as of the date thereof, including liabilities for taxes, material commitments and Indebtedness.

(b)The unaudited consolidated balance sheet of Borrower Parent dated as of the most recently completed fiscal quarter of Borrower Parent, and the related consolidated statements of income or operations, shareholders’ equity and cash flows for the fiscal quarter ended on that date

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(i) were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein, and (ii) fairly present in all material respects the financial condition of Borrower Parent as of the date thereof and its results of operations for the period covered thereby, subject, in the case of clauses (i) and (ii), to the absence of footnotes and to normal year-end audit adjustments; it being understood that no such representation is made in relation to any consolidated statements of income or operations, shareholders’ equity and cash flows for the fiscal quarter ended September 30, 2013 because no such consolidated statements of income or operations, shareholders’ equity and cash flows have been prepared for such fiscal quarter.

(c)Since the date of the Audited Financial Statements, or if prior to the furnishing of the first Audited Financial Statements pursuant to Section 6.01(a), since September 30, 2013, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect (not including any Collateral Value Condition).

5.06Litigation.

As of the Closing Date and the Second Closing Date, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of the Company, threatened in writing, at law, in equity, in arbitration or before any Governmental Authority, by or against the Company or against any of its properties or revenues. As of any date after the Closing Date, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of the Company, threatened in writing, at law, in equity, in arbitration or before any Governmental Authority, by or against the Company or against any of its properties or revenues that either individually or in the aggregate could reasonably be expected to have a Material Adverse Effect.

5.07No Default.

The Company has no Contractual Obligations other than (A) pursuant to (i) the Loan Documents, (ii) the Investment Advisory Agreement, (iii) the Sale Agreement and (iv) the purchase or sale of Collateral Assets as permitted under the Loan Documents, or, in each case, Contractual Obligations that are incidental thereto, and (B) as indicated in Schedule 5.07 (as such Schedule may be updated from time to time by written agreement of the Company and the Administrative Agent). The Company is not in default in any material respect under or with respect to any Contractual Obligation. No Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Agreement or any other Loan Document.

5.08Liens.

The property of the Company is subject to no Liens other than Permitted Liens.

5.09Taxes.

(a)The Company and the Borrower Parent have filed all Federal, state and other material tax returns and reports required to be filed, and have paid or caused to be paid all Federal, state and other material taxes, assessments, fees and other governmental charges levied or imposed upon

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them or their properties, income or assets otherwise due and payable by them, except those which are being contested in good faith by appropriate proceedings diligently conducted or where such filings or payments are not material. There is no material tax assessment proposed in writing against the Company or the Borrower Parent. Neither the Company nor the Borrower Parent is party to any tax sharing agreement.

(b)For U.S. federal income tax purposes (i) Borrower is a disregarded entity and Borrower Parent is its sole owner, and (ii) Borrower Parent is a U.S. Person.

5.10ERISA Matters.

(i) Neither the Company nor any ERISA Affiliate of the Company has incurred or could be subjected to any liability under Title IV of ERISA or Section 4975 of the Code (other than for premiums due) or maintains or contributes to, or is or has been required to maintain or contribute to, any Plan, except as could not reasonably be expected to have a Material Adverse Effect, and (ii) the Company does not, nor is deemed to, hold Plan Assets.

5.11Equity Interests.

All Equity Interests of the Company are duly and validly issued. There are no outstanding warrants, options or other rights to purchase, or shareholder, voting trust or similar agreements outstanding with respect to, or property that is convertible into, or that requires the issuance or sale of, any such Equity Interests. All Equity Interests of the Company are owned by Borrower Parent.

5.12Margin Regulations; Investment Company Act.

(a)    No Borrower is engaged or will engage, principally or as one of its important activities, in the business of purchasing or carrying margin stock (within the meaning of Regulation U issued by the FRB), or extending credit for the purpose of purchasing or carrying margin stock.

(b)    None of the Company or any Person Controlling the Company is or is required to be registered as an “investment company” under the Investment Company Act.

5.13Disclosure.

The Company has made available to the Administrative Agent and the Lenders all agreements, instruments and corporate or other restrictions to which it is subject, and has disclosed all other matters known to it, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect (other than a Collateral Value Condition). No report, financial statement, certificate or other information furnished (whether orally or in writing) by or on behalf of the Company or the Borrower Parent to the Administrative Agent or any Lender in connection with the transactions contemplated hereby and the negotiation of this Agreement or delivered hereunder or under any other Loan Document (in each case, as modified or supplemented by other information so furnished) contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that, (i) with respect to projected financial information, the

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Company represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time of preparation, and (ii) with respect to information furnished by the Company which was provided to the Company from an obligor or another third party with respect to a Collateral Asset, such information need only be true, correct and complete to the knowledge of the Company.

5.14Compliance with Laws.

The Company is in compliance in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its properties, except in such instances in which such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted.

5.15Taxpayer Identification Number; Other Identifying Information.

The true and correct U.S. taxpayer identification number of the Borrower (if any) and that of the Borrower Parent are set forth on Schedule 5.15. The Borrower’s exact legal name at the date of this Agreement and any prior legal names, and the Borrower’s, jurisdiction of organization, organizational identification number, registered office, and the place of business of Investment Adviser, or if Investment Adviser has more than one place of business, Investment Adviser’s chief executive office, in each case at the date of this Agreement and for the four months immediately preceding the date of this Agreement are, in each case, as set forth in are set forth on Schedule 5.15.

5.16OFAC.

Neither the Borrower or, to the knowledge of the Borrower, any director, officer, employee, agent, or Affiliate (other than an Excluded Affiliate) thereof is an individual or entity currently the subject of any Sanctions, nor is the Borrower located, organized or resident in a Designated Jurisdiction.

ARTICLE VI.AFFIRMATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder, or any Loan or other Obligation hereunder shall remain unpaid or unsatisfied the Company shall:

6.01Financial Statements.

Deliver (including by causing the Borrower Parent to deliver) to the Administrative Agent for further distribution to each Lender, in form and detail reasonably satisfactory to the Administrative Agent:

(a)as soon as available, but in any event within 90 days after the end of each fiscal year of Borrower Parent (beginning with the fiscal year ended December 31, 2013), a consolidated balance sheet of Borrower Parent as at the end of such fiscal year, and the related consolidated statements of income or operations, changes in net assets, and cash flows for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable

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detail and prepared in accordance with GAAP, audited and accompanied by a report and opinion of an independent certified public accountant of nationally recognized standing reasonably acceptable to the Required Lenders, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be subject to any “going concern” or like qualification or exception or any qualification or exception as to the scope of such audit, and such consolidated statements to be certified by the chief executive officer, chief financial officer, treasurer or controller of the Borrower Parent to the effect that such statements are fairly stated in all material respects when considered in relation to the consolidated financial statements of the Borrower Parent;

(b)as soon as available, but in any event within 45 days after the end of each of the first three fiscal quarters of each fiscal year of Borrower Parent (commencing with the first full fiscal quarter ended after the Closing Date), a consolidated balance sheet of Borrower Parent as at the end of such fiscal quarter, the related consolidated statements of income or operations for such fiscal quarter and for the portion of Borrower Parent’s fiscal year then ended, and the related consolidated statements of changes in net assets, and cash flows for the portion of the Borrower Parent’s fiscal year then ended, in each case setting forth in comparative form, as applicable, the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding portion of the previous fiscal year, all in reasonable detail and prepared in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes, certified by the chief executive officer, chief financial officer, treasurer or controller of Borrower Parent as fairly presenting the financial condition, results of operations, net assets and cash flows of Borrower Parent in accordance with GAAP, subject only to normal year-end audit adjustments and the absence of footnotes;

(c)as soon as available and in any event not later than the last Business Day of the calendar month following each monthly accounting period (ending on the last day of each calendar month) of the Borrower, the Net Asset Value and, upon the request of the Administrative Agent, supporting calculations thereof, in each case, of the Borrower, as at the last day of such accounting period;

(d)    promptly following any request therefor, (I) such other information regarding the operations, business affairs and financial condition of the Borrower or compliance with the terms of this Agreement and the other Loan Documents or (II) to the extent reasonably related to the operations, business affairs or financial condition of the Borrower or the compliance with the terms of this Agreement and the other Loan Documents and to the extent permitted under applicable Law, such other information regarding the Borrower Parent, Investment Adviser or Investment Adviser Parent, in each case as the Administrative Agent or any Lender may reasonably request.

6.02Certificates; Other Information.

Deliver, or cause the Borrower Parent to deliver, to the Administrative Agent for further distribution to each Lender, in form and detail satisfactory to the Administrative Agent and the Required Lenders:

(a)promptly upon receipt thereof, copies of all significant reports (excluding routine, periodic reports) submitted by the Borrower Parent’s independent public accountants in connection with each annual, interim or special audit or review of any type of the financial statements or related

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internal control systems of the Borrower Parent delivered by such accountants to the management or board of directors of the Borrower Parent;

(b)concurrently with the delivery of any of the financial statements or monthly report referred to in Section 6.01, a duly completed Compliance Certificate signed by the president or a vice president of Borrower Parent or Borrower, as applicable (which delivery may, unless the Administrative Agent, or a Lender requests executed originals, be by electronic communication including fax or email and shall be deemed to be an original authentic counterpart thereof for all purposes);

(c)concurrently with any delivery of the financial statements referred to in Section 6.01, a duly completed Compliance Certificate signed by the president or vice president of Borrower Parent or Borrower, as applicable (which delivery may, unless the Administrative Agent, or a Lender requests executed originals, be by electronic communication including fax or email and shall be deemed to be an original authentic counterpart thereof for all purposes) (i) certifying as to whether the Borrower has knowledge that a Default has occurred and, if a Default has occurred, specifying the details thereof and any actions taken or proposed to be taken with respect there to, (ii) stating whether any change in GAAP as applied by (or in the application of GAAP by) the Borrower or Borrower Parent has occurred since the date of the last audited financial statements referred to in Section 6.01(a) and if, any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate;

(d)promptly, and in any event within five Business Days after receipt thereof by Borrower, Borrower Parent, Investment Adviser or Investment Adviser Parent, copies of each notice or other correspondence received from the SEC (or comparable agency in any applicable non-U.S. jurisdiction) concerning any investigation or possible investigation or other inquiry by such agency regarding financial or other operational results of any such entity that is materially likely to proceed; provided that such investigation, possible investigation or other inquiry could reasonably be expected to have a material adverse impact on Investment Adviser or on the ability of Investment Adviser to perform its obligations under the Investment Advisory Agreement;

(e)promptly, such additional information regarding the business, financial or corporate affairs of the Company, or compliance with the terms of the Loan Documents, as the Administrative Agent or any Lender may from time to time reasonably request.

Documents required to be delivered pursuant to Sections 6.01(a), 6.01(b) and 6.02  may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which (i) Borrower Parent posts such documents, or provides a link thereto on the website listed on Schedule 10.02, (ii)  such documents are posted on Borrower Parent’s behalf on an Internet or intranet website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent), including via EDGAR, or (iii)  the Company provides to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents; provided that: the Company shall use commercially reasonable efforts to notify the Administrative Agent (by facsimile or electronic mail) of the posting pursuant to clause (i) and (ii) above of any such documents, and the Administrative Agent hereby agrees that it shall use commercially reasonable efforts to post such documents received pursuant

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to clause (iii) above on the Company’s behalf to a commercial, third-party or other website sponsored by the Administrative Agent and notify the Lenders of such posting. The Administrative Agent shall have no obligation to request the delivery or to maintain any copies of the documents referred to above, and in any event shall have no responsibility to monitor compliance by the Company with any such request for delivery, and each Lender shall be solely responsible for requesting delivery to it or maintaining its copies of such documents.

Borrower hereby acknowledges that (a) the Administrative Agent and/or the Arranger may, but shall not be obligated to, make available to the Lenders materials and/or information provided by or on behalf of the Borrower or Borrower Parent hereunder (collectively, “Borrower Materials”) by posting the Borrower Materials on DebtDomain, IntraLinks, Syndtrak or another similar electronic system (the “Platform”) and (b) certain of the Lenders (each, a “Public Lender”) may have personnel who do not wish to receive material non-public information with respect to Borrower or its Affiliates, or the respective securities of any of the foregoing, and who may be engaged in investment and other market-related activities with respect to such Persons’ securities. Borrower hereby agrees that (w) all Borrower Materials that are to be made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently on the first page thereof; (x) by marking Borrower Materials “PUBLIC,” Borrower shall be deemed to have authorized the Administrative Agent, the Arranger and the Lenders to treat such Borrower Materials as not containing any material non-public information with respect to Borrower or its securities for purposes of United States Federal and state securities laws (provided, however, that to the extent such Borrower Materials constitute Information, they shall be treated as set forth in Section 10.07); (y) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public Side Information;” and (z) the Administrative Agent and the Arranger shall be entitled to treat any Borrower Materials that are not marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public Side Information.”

6.03Notices.

Promptly notify, or cause the Borrower Parent to promptly notify, the Administrative Agent:

(a)upon a Responsible Officer of the Company obtaining knowledge of the occurrence of any Default;

(b)of the occurrence of any of the following matters that has resulted or could reasonably be expected to result in a Material Adverse Effect (other than a Collateral Value Condition): (i) any material breach or non-performance of, or any default under, a Contractual Obligation of the Company or Borrower Parent; (ii) any dispute, litigation, investigation, proceeding or suspension between the Company or Borrower Parent and any Governmental Authority; (iii) the commencement of, or any material development in, any litigation or proceeding affecting the Company or Borrower Parent; or (iv) any other matter that has resulted or could reasonably be expected to result in a Material Adverse Effect (other than a Collateral Value Condition); and

(c)of any material change in accounting policies or financial reporting practices by the Company or Borrower Parent.

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Each notice pursuant to this Section 6.03 shall be accompanied by a statement of a Responsible Officer of the Company setting forth details of the occurrence referred to therein and stating what action the Company has taken and proposes to take with respect thereto. Each notice pursuant to Section 6.03(a) shall describe with particularity any and all provisions of this Agreement and any other Loan Document that have been breached.

6.04Payment of Obligations.

Pay and discharge as the same shall become due and payable, all its obligations and liabilities, including (a) all material Tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Company; (b) all material lawful claims which, if unpaid, would by law become a Lien upon its property, unless the same are being contested in good faith by appropriate proceedings diligently conducted and adequate reserves in accordance with GAAP are being maintained by the Company; and (c) all material Indebtedness, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such Indebtedness.

6.05Preservation of Existence, Etc.

(a)    To the maximum extent permitted pursuant to applicable Laws, preserve, renew and maintain in full force and effect its legal existence and good standing under the Laws of the jurisdiction of its organization except in a transaction permitted by Section 7.04 or 7.05 and (b) take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business, except to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect.

6.06[RESERVED].

6.07Further Assurances.

At any time or from time to time upon the reasonable request of the Administrative Agent, Borrower shall execute and deliver such further documents and do such other acts and things as the Administrative Agent may reasonably request in order to effect fully the purposes of this Agreement or the other Loan Documents and to provide for payment of the Loans made hereunder, with interest thereon, in accordance with the terms of this Agreement.

6.08Compliance with Laws.

Comply in all material respects with the requirements of all Laws and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted.

6.09Books and Records.

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(a) Maintain proper books of record and account, in which full, true and correct entries in conformity with GAAP consistently applied shall be made of all financial transactions and matters involving the assets and business of the Company; and (b) maintain such books of record and account in material conformity with all applicable requirements of any Governmental Authority having regulatory jurisdiction over the Company.

6.10Inspection Rights.

Permit representatives and independent contractors of each Lender (at the sole cost and expense of such Lender) and the Administrative Agent to visit and inspect any of its properties (or to the extent reasonably necessary or appropriate to examine records relating to the Collateral, the Loan Documents or the Investment Advisory Agreement, the properties of Investment Adviser, Borrower Parent or Investment Adviser Parent), to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss its affairs, finances and accounts relating to the Collateral, or to the operations of the Borrower under or compliance by the Borrower with the terms of the Loan Documents or the Investment Advisory Agreement, with its directors, officers and independent public accountants or Investment Adviser, at such reasonable times during normal business hours, upon reasonable advance notice to the Company and at the expense of the Company; provided, however, that (x) when an Event of Default exists the Administrative Agent (or any Lender (or any of their respective representatives or independent contractors)) may do any of the foregoing at the expense of the Company at any time during normal business hours and without advance notice and (y) for so long as no Event of Default has occurred and is continuing, the Company shall be obligated in any fiscal year to reimburse the Administrative Agent only for the expense of the first such audit and/or appraisal pursuant to this Section 6.10 in such fiscal year.

6.11Use of Proceeds.

Use the proceeds of the Credit Extensions solely for Permitted Uses. For the avoidance of doubt, a Restricted Payment that complies with Section 7.06 hereof and is made on or about the date of a Credit Extension shall not be considered an impermissible use of proceeds under this Section 6.11 so long as the Company did not directly apply the proceeds of the relevant Credit Extension to the Restricted Payment.

6.12Approvals and Authorizations.

Maintain all authorizations, consents, approvals and licenses from, exemptions of, and filings and registrations with, each Governmental Authority of the jurisdiction in which the Company is organized and existing, and all approvals and consents of each other Person in such jurisdiction, in each case that are required in connection with the Loan Documents, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect.

6.13Special Purpose Entity Requirements.

Conduct at all times its business and operations in accordance with the Special Purpose Entity Requirements and the provisions of Section 1.07 of the Limited Liability Company

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Agreement, maintain at all times 100% ownership of all Equity Interests of the Company by Borrower Parent.

6.14Security Interest.

Maintain a perfected security interest in the Collateral for the benefit of the Lenders, their successors, transferees and assigns so long as this Agreement is in effect.

6.15ERISA Matters.

Do, or cause to be done, all things necessary to ensure that it will not be deemed to hold Plan Assets at any time.

ARTICLE VII.NEGATIVE COVENANTS

So long as any Lender shall have any Commitment hereunder or any Loan or other Obligation hereunder shall remain unpaid or unsatisfied, the Company shall not, directly or indirectly:

7.01Liens.

Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter acquired, other than Permitted Liens.

7.02Investments.

Own any Structured Finance Obligation.

7.03Indebtedness; Bank Accounts.

Create, incur, assume or suffer to exist any Indebtedness, except Indebtedness under the Loan Documents, or open or establish any bank accounts except as contemplated by the Collateral Administration Agreement.

7.04Fundamental Changes.

Merge, dissolve, liquidate, wind-up, consolidate with or into another Person, or Dispose of (whether in one transaction or in a series of transactions) all or substantially all of its assets (whether now owned or hereafter acquired) to or in favor of any Person; without at least 30 days’ prior written notice to the Administrative Agent, change (or allow Investment Adviser to change) any of the information in Schedule 5.15; or amend, alter, change or supplement its Organization Documents unless the Administrative Agent has consented thereto in writing.

7.05Sale of Collateral Assets.

Sell, assign, transfer, convey or otherwise dispose of any Collateral Asset unless, after giving effect to any such sale, assignment transfer, conveyance or disposition and any simultaneous prepayment of any Loan in accordance with Section 2.03, (i) based on the most recent Borrowing

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Base determination received from the Administrative Agent, no Borrowing Base Deficiency will exist and (ii) no Default would occur or be continuing after giving effect thereto; provided that, for the avoidance of doubt, the Borrower shall at all times be permitted to sell any Collateral Asset to an Approved Dealer in order to cure any Borrowing Base Deficiency so long as no Default would otherwise occur or be continuing after giving effect thereto.

7.06Restricted Payments.

Declare or make, directly or indirectly, any Restricted Payment, or incur any obligation (contingent or otherwise) to do so, or issue or sell any Equity Interests,except that, so long as no Default shall have occurred and be continuing or would result therefrom, the Company may make distributions to Borrower Parent.

7.07Transactions with Affiliates.

Enter into any transaction of any kind with any Affiliate of the Company, whether or not in the ordinary course of business, other than on fair and reasonable terms no less favorable to the Company as would be obtainable by the Company at the time in a comparable arm’s length transaction with a Person other than an Affiliate; and without limitation of the foregoing, the Company shall not purchase any Collateral Assets from Borrower Parent or other Relevant Affiliates other than in accordance with the terms and conditions of the Sale Agreement.

7.08Burdensome Agreements.

Enter into any Contractual Obligation (other than this Agreement, any other Loan Document, the Sale Agreement or the Investment Advisory Agreement) that (a) limits the ability of the Company to create, incur, assume or suffer to exist Liens on property of the Company or (b) requires the grant of a Lien to secure an obligation of the Company if a Lien is granted to secure another obligation of the Company.

7.09Use of Proceeds.

Use the proceeds of any Credit Extension, whether directly or indirectly, and whether immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of Regulation U of the FRB) or to extend credit to others for the purpose of purchasing or carrying margin stock or to refund indebtedness originally incurred for such purpose.

7.10Sanctions.

Directly or indirectly, use the proceeds of any Credit Extension, or lend or contribute such proceeds to any individual or entity, to fund any activities of or business with any individual, or entity, or in any Designated Jurisdiction, that, at the time of such funding, is the subject of Sanctions, or in any other manner that will result in a violation by any individual or entity participating in the transaction (whether as Lender, Arranger, Administrative Agent or otherwise) of Sanctions.

7.11Special Purpose Entity Requirements.

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(a) Conduct at any time its business or operations in contravention of the Special Purpose Entity Requirements, or

(b) Be party to any agreement under which it has any material obligation or liability (direct or contingent) without including customary “non-petition” provisions substantially similar to Section 10.20(b), other than with the consent of the Administrative Agent (not to be unreasonably withheld or delayed), provided however that such requirement shall not apply to agreements effecting the purchase and sale of any Collateral Asset which contain customary (as determined by the Investment Adviser) purchase or sale terms or which are documented using customary (as determined by the Investment Adviser) loan trading documentation, or to any credit agreements or related loan or bond documents to which the Company becomes party solely as a result of owning a Collateral Asset.

7.12Investment Advisory Agreement and Sale Agreement Amendment.

Amend the Investment Advisory Agreement or Sale Agreement, other than an amendment that either (A) solely cures any ambiguity or manifest error in either agreement or (B) is an amendment to which the Administrative Agent has consented in writing (such consent not to be unreasonably withheld or delayed). The Borrower shall give reasonable prior notice to the Administrative Agent of any amendment to the Investment Advisory Agreement or Sale Agreement. For the avoidance of doubt, any ordinary course renewal of the Investment Advisory Agreement shall not require the consent of the Administrative Agent.

7.13ERISA.

(a)Maintain or contribute to, or agree to maintain or contribute to, or permit any ERISA Affiliate of the Company to maintain or contribute to or agree to maintain or contribute to, any Plan, except as could not reasonably be expected to have a Material Adverse Effect.

(b)Hold Plan Assets.

ARTICLE VIII.EVENTS OF DEFAULT AND REMEDIES

8.01Events of Default.

Any of the following shall constitute an Event of Default:

(a)Non-Payment. The Borrower fails to pay (i) when and as required to be paid herein, (A) any amount of principal of any Loan, or (B) on the Maturity Date any interest on any Loan or any fee due hereunder, (ii) other than with respect to the Maturity Date, within two Business Days after the same becomes due, any interest on any Loan, or any fee due hereunder, or (iii) within five days after the same becomes due, any other amount payable hereunder or under any other Loan Document; or

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(b)Borrowing Base Deficiency.    A Borrowing Base Deficiency exists and the Borrower fails to give written notice of its intent to cure or fails to actually cure the Borrowing Base Deficiency in accordance with Section 2.03(b); or

(c)Specified Covenants. The Company fails to perform or observe in any material respect any covenant in Sections 6.11, 6.13, 6.15, 7.01, 7.03, 7.04,7.07, 7.09,7.11 or 7.13; or

(d)Insolvency Proceedings, Etc. The Company institutes or consents to the institution of any proceeding under any Debtor Relief Law, or makes an assignment for the benefit of creditors; or applies for or consents to the appointment of any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer for it or for all or any material part of its property; or any receiver, trustee, custodian, conservator, liquidator, rehabilitator or similar officer is appointed without the application or consent of the Company or its Affiliates and the appointment continues undischarged or unstayed for 60 calendar days; or any proceeding under any Debtor Relief Law relating to the Company or to all or any material part of its property is instituted without the consent of the Company or its Affiliates and continues undismissed or unstayed for 60 calendar days, or an order for relief is entered in any such proceeding; or

(e)Other Defaults. The Company fails to perform or observe in a material respect any other covenant or agreement (not specified in subsection (a) through (d) above) contained in any Loan Document on its part to be performed or observed and such failure continues for 30 days following the Company’s receipt of written notice from the Administrative Agent; or

(f)Borrower Certification. Any Borrower Certification proves to have been inaccurate when made; or

(g)Representations and Warranties. Any representation, warranty, certification or statement of fact (other than a Borrower Certification) made or deemed made by or on behalf of the Company herein, in any other Loan Document, or in any document delivered in connection herewith or therewith (I) to the extent already qualified with respect to “material” matters or “Material Adverse Effect”, shall prove to have been incorrect or misleading when made or deemed made and (II) to the extent not already qualified with respect to “material” matters or “Material Adverse Effect”, shall prove to have been incorrect or misleading in a material respect when made or deemed made, and in each case such representation is, in the reasonable determination of the Administrative Agent, either (A) not capable of cure or (B) capable of cure but not cured within 30 days following notice; or

(h)Security Interest Failure. (A) The Administrative Agent fails for any reason to have a perfected security interest in any Collateral in accordance with the terms of the Security Agreement (“Affected Collateral”) and either (i) such failure is not due to error of the Collateral Administrator or (ii) such failure is due to error of the Collateral Administrator and such failure continues for 3 days following notice, and (B) the aggregate Current Market Value of such Affected Collateral is more than $100,000;

(i)Credit Triggers. Any Credit Trigger shall occur; or

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(j)Invalidity of Loan Documents. Any material obligation of the Company or its Affiliates under any Loan Document at any time after its execution and delivery and for any reason other than as expressly permitted hereunder or thereunder or satisfaction in full of all the Obligations, ceases to be in full force and effect; or the Company or any Affiliate (including any Responsible Officer thereof) contests in any manner the validity or enforceability of any material provision of any Loan Document; or the Company denies that it has any or further liability or obligation under any Loan Document, or purports to revoke, terminate or rescind any material provision of any Loan Document.

8.02Remedies Upon Event of Default.

If any Event of Default occurs and is continuing, the Administrative Agent shall at the request of the Required Lenders (or may with the consent of the Required Lenders) take any or all of the following actions:

(a)declare the commitment of each Lender to make Loans to be terminated, whereupon such commitments and obligation shall be terminated;

(b)declare the unpaid principal amount of all outstanding Loans, all interest accrued and unpaid thereon, and all other amounts owing or payable hereunder or under any other Loan Document to be immediately due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby expressly waived by the Borrower; or

(c)deliver a notice of exclusive control in relation to the Collateral Account and give instructions to the Collateral Administrator in relation thereto under the provisions of the Security Agreement, and may (in addition to all other rights and remedies under the Loan Documents and/or of a secured party under the UCC and other legal or equitable remedies) realize upon the Collateral, and/or may immediately sell, assign, give option or options to purchase or otherwise dispose of and deliver the Collateral or any part thereof, subject to, and in accordance with the terms of the Security Agreement (including, without limitation, Section 6.5 thereof); and

(d)exercise on behalf of itself and the Lenders all rights and remedies available to it and the Lenders under the Loan Documents;

provided, however, that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the Bankruptcy Code of the United States, the obligation of each Lender to make Loans shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest and other amounts as aforesaid shall automatically become due and payable, in each case without further act of the Administrative Agent or any Lender.

8.03Application of Funds.

After the exercise of remedies provided for in Section 8.02 (or after the Loans have automatically become immediately due and payable as set forth in the proviso to Section 8.02), any amounts received on account of the Obligations shall, subject to the provisions of Section 2.12, and

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subject to any prior claims of the Collateral Administrator under the Security Agreement, be applied by the Administrative Agent in the following order:

First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (including fees, charges and disbursements of external counsel to the Administrative Agent and amounts payable under Article III) payable to the Administrative Agent in its capacity as such;

Second, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal and interest) payable to the Lenders (including fees, charges and disbursements of external counsel to the respective Lenders and amounts payable under Article III), ratably among them in proportion to the respective amounts described in this clause Second payable to them;

Third, to payment of that portion of the Obligations constituting accrued and unpaid interest on the Loans and other Obligations, ratably among the Lenders in proportion to the respective amounts described in this clause Third payable to them;

Fourth, to payment of that portion of the Obligations constituting unpaid principal of the Loans, ratably among the Lenders in proportion to the respective amounts described in this clause Fourth held by them; and

Last, the balance, if any, after all of the Obligations have been indefeasibly paid in full, to the Company or as otherwise required by Law.

ARTICLE IX.ADMINISTRATIVE AGENT

9.01Appointment and Authority.

Each of the Lenders hereby irrevocably appoints Bank of America to act on its behalf as the Administrative Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto. The provisions of this Article are solely for the benefit of the Administrative Agent and the Lenders and the Company shall have no rights as third party beneficiary of any such provisions, except that that the Company shall be entitled to rely on and enforce the provisions of Sections 9.06 and 9.10. It is understood and agreed that the use of the term “agent” herein or in any other Loan Documents (or any other similar term) with reference to the Administrative Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead such term is used as a matter of market custom, and is intended to create or reflect only an administrative relationship between contracting parties.

9.02Rights as a Lender.

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The Person serving as the Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include the Person serving as the Administrative Agent hereunder in its individual capacity. Such Person and its Affiliates may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with the Borrower or Affiliate thereof as if such Person were not the Administrative Agent hereunder and without any duty to account therefor to the Lenders.

9.03Exculpatory Provisions.

The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Loan Documents, and its duties hereunder shall be administrative in nature. Without limiting the generality of the foregoing, the Administrative Agent:

(a)shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(b)shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents or those rights and powers that the Administrative Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents), provided that the Administrative Agent shall not be required to take any action that, in its opinion or the opinion of its counsel, may expose the Administrative Agent to liability or that is contrary to any Loan Document or applicable law, including for the avoidance of doubt any action that may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property of a Defaulting Lender in violation of any Debtor Relief Law; and

(c)shall not, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to the Borrower or any of its Affiliates that is communicated to or obtained by the Person serving as the Administrative Agent or any of its Affiliates in any capacity.

The Administrative Agent shall not be liable for any action taken or not taken by it (i) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Sections 10.01 and 8.02) or (ii) in the absence of its own bad faith, gross negligence or willful misconduct as determined by a court of competent jurisdiction by final and nonappealable judgment. The Administrative Agent shall be deemed not to have knowledge of any Default unless and until notice describing such Default is given in writing to the Administrative Agent by the Company or a Lender.

The Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered

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hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

9.04Reliance by Administrative Agent.

The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan that by its terms must be fulfilled to the satisfaction of a Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender unless the Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Loan. The Administrative Agent may consult with legal counsel (who may be counsel for the Company), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

9.05Delegation of Duties.

The Administrative Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through any one or more sub‑agents appointed by the Administrative Agent. The Administrative Agent and any such sub‑agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties. The exculpatory provisions of this Article shall apply to any such sub‑agent and to the Related Parties of the Administrative Agent and any such sub‑agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent. The Administrative Agent shall not be responsible for the negligence or misconduct of any sub-agents except to the extent that such sub-agents were not appointed with due care or a court of competent jurisdiction determines in a final and nonappealable judgment that the Administrative Agent acted with bad faith, gross negligence or willful misconduct in the selection of such sub-agents.

9.06Resignation of Administrative Agent.

(a)    The Administrative Agent may at any time give notice of its resignation to the Lenders and the Company. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, if no Event of Default exists or is continuing upon the prior written consent of the Borrower (such consent not to be unreasonably withheld or delayed), and if an Event of Default exists and is continuing in consultation with the Company, to appoint a successor, which at all times shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United

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States. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation (or such earlier day as shall be agreed by the Required Lenders) (the “Resignation Effective Date”), then the retiring Administrative Agent may (but shall not be obligated to) on behalf of the Lenders, appoint a successor Administrative Agent meeting the qualifications set forth above. Whether or not a successor has been appointed, such resignation shall become effective in accordance with such notice on the Resignation Effective Date.

(b)If the Person serving as Administrative Agent is a Defaulting Lender pursuant to clause (d) of the definition thereof, the Required Lenders may, to the extent permitted by applicable law, by notice in writing to the Company and such Person remove such Person as Administrative Agent and, in consultation with the Company, appoint a successor. If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days (or such earlier day as shall be agreed by the Required Lenders) (the “Removal Effective Date”), then such removal shall nonetheless become effective in accordance with such notice on the Removal Effective Date.

(c)With effect from the Resignation Effective Date or the Removal Effective Date (as applicable) (1) the retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents and (2) except for any indemnity payments or other amounts then owed to the retiring or removed Administrative Agent, all payments, communications and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender directly, until such time, if any, as the Required Lenders appoint a successor Administrative Agent as provided for above. Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or removed) Administrative Agent (other than as provided in Section 3.01(g) and other than any rights to indemnity payments or other amounts owed to the retiring or removed Administrative Agent as of the Resignation Effective Date or the Removal Effective Date, as applicable), and the retiring or removed Administrative Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section) . The fees payable by the Company to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Company and such successor. After the retiring or removed Administrative Agent’s resignation or removal hereunder and under the other Loan Documents, the provisions of this Article and Section 10.04 shall continue in effect for the benefit of such retiring or removed Administrative Agent, its sub agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring or removed Administrative Agent was acting as Administrative Agent.

9.07Non-Reliance on Administrative Agent and Other Lenders.

Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without

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reliance upon the Administrative Agent or any other Lender or any of their Related Parties and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

9.08No Other Duties, Etc.

Anything herein to the contrary notwithstanding, none of the Book Manager or Arranger listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent or a Lender hereunder.

9.09Administrative Agent May File Proofs of Claim.

In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to the Company, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled and empowered, by intervention in such proceeding or otherwise

(a)to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the Administrative Agent under Sections 2.09 and 10.04) allowed in such judicial proceeding; and

(b)to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.09 and 10.04.

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Obligations or the rights of any Lender to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

9.10Collateral Matters.

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Without limiting the provisions of Section 9.09, the Lenders irrevocably authorize the Administrative Agent, at its option and in its discretion,

(a)to release any Lien on any property granted to or held by the Administrative Agent under any Loan Document (i) upon termination of the Aggregate Commitments and payment in full of all Obligations (other than contingent indemnification obligations), (ii) that is sold or otherwise disposed of or to be sold or otherwise disposed of as part of or in connection with any sale or other disposition permitted hereunder or under any other Loan Document, or (iii) subject to Section 10.01, if approved, authorized or ratified in writing by the Required Lenders; and

(b)to subordinate any Lien on any property granted to or held by the Administrative Agent under any Loan Document to the holder of any Lien on such property that is permitted by Section 7.01(i).

Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release or subordinate its interest in particular types or items of property pursuant to this Section 9.10.

The Administrative Agent shall not be responsible for or have a duty to ascertain or inquire into any representation or warranty regarding the existence, value or collectability of the Collateral, the existence, priority or perfection of the Administrative Agent’s Lien thereon, or any certificate prepared by the Company in connection therewith, nor shall the Administrative Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the Collateral.

ARTICLE X.MISCELLANEOUS

10.01Amendments, Etc.

No amendment or waiver of any provision of this Agreement or any other Loan Document, and no consent to any departure by the Company therefrom, shall be effective unless in writing signed by the Required Lenders and the Company and acknowledged by the Administrative Agent (the “Required Approvals”), and each such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given; provided, however, that in addition to receiving such Required Approvals no such amendment, waiver or consent shall:

(a)waive any condition set forth in Section 4.01(a) without the written consent of each Lender;

(b)extend or increase the Commitment of any Lender (or reinstate any Commitment terminated pursuant to Section 8.02) without the written consent of such Lender;

(c)postpone any date fixed by this Agreement or any other Loan Document for any payment of principal, interest, fees or other amounts due to the Lenders (or any of them) hereunder or under any other Loan Document without the written consent of each Lender directly affected thereby;

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(d)reduce the principal of, or the rate of interest specified herein on, any Loan, or (subject to clause (ii) of the second proviso to this Section 10.01) any fees or other amounts payable hereunder or under any other Loan Document, or change the manner of computation of any financial ratio (including any change in any applicable defined term) used in determining the Applicable Rate that would result in a reduction of any interest rate on any Loan or any fee payable hereunder without the written consent of each Lender directly affected thereby; provided, however, that only the consent of the Required Lenders shall be necessary to amend the definition of “Default Rate” or to waive any obligation of the Borrower to pay interest at the Default Rate;

(e)change Section 8.03 in a manner that would alter the pro rata sharing of payments required thereby without the written consent of each Lender; or

(f)change any provision of this Section or the definition of “Required Lenders” or any other provision hereof specifying the number or percentage of Lenders required to amend, waive or otherwise modify any rights hereunder or make any determination or grant any consent hereunder without the written consent of each Lender;

and, providedfurther, that (i) no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition to the Lenders required above, affect the rights or duties of the Administrative Agent under this Agreement or any other Loan Document; and (ii) each Fee Letter may be amended, or rights or privileges thereunder waived, in a writing executed only by the parties thereto. Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Lender and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender disproportionately adversely relative to other affected Lenders shall require the consent of such Defaulting Lender.

10.02Notices; Effectiveness; Electronic Communication.

(a)Notices Generally. Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile or electronic mail as follows, and all notices and other communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:

(i)if to the Company or the Administrative Agent, to the address, facsimile number, electronic mail address or telephone number specified for such Person on Schedule 10.02; and

(ii)if to any other Lender, to the address, facsimile number, electronic mail address or telephone number specified in its Administrative Questionnaire (including, as

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appropriate, notices delivered solely to the Person designated by a Lender on its Administrative Questionnaire then in effect for the delivery of notices that may contain material non-public information relating to the Company).

Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices and other communications sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient). Notices and other communications delivered through electronic communications to the extent provided in subsection (b) below, shall be effective as provided in such subsection (b).

(b)Electronic Communications. Notices and other communications to the Lenders hereunder may be delivered or furnished by electronic communication (including e‑mail and Internet or intranet websites) pursuant to procedures approved by the Administrative Agent, provided that the foregoing shall not apply to notices to any Lender pursuant to Article II if such Lender has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Company may each, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it, provided that approval of such procedures may be limited to particular notices or communications.

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon sending, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor; provided that, for both clauses (i) and (ii), if such notice, email or other communication is not sent during the normal business hours of the recipient, such notice, email or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient.

(c)The Platform. THE PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE.” THE AGENT PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE BORROWER MATERIALS. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its Related Parties (collectively, the “Agent Parties”) have any liability to the Borrower, any Lender or any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the Company’s or the Administrative Agent’s transmission of Borrower Materials through the Internet.

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(d)Effectiveness of Facsimile of Electronic Mail Documents. Loan Documents may be transmitted by facsimile or electronic mail. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually-signed originals and shall be binding on the Company, the Administrative Agent and the Lenders. The Administrative Agent may also require that any such documents and signatures be confirmed by a manually-signed original thereof; provided, however, that the failure to request or deliver the same shall not limit the effectiveness of any facsimile or electronic mail document or signature.

(e)Change of Address, Etc. The Borrower and the Administrative Agent may change its address, electronic mail address, facsimile or telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lender may change its address, electronic mail address, facsimile or telephone number for notices and other communications hereunder by notice to the Company and the Administrative Agent. In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that the Administrative Agent has on record (i) an effective address, contact name, telephone number, facsimile number and electronic mail address to which notices and other communications may be sent and (ii) accurate wire instructions for such Lender. Furthermore, each Public Lender agrees to cause at least one individual at or on behalf of such Public Lender to at all times have selected the “Private Side Information” or similar designation on the content declaration screen of the Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and applicable Law, including United States Federal and state securities Laws, to make reference to Borrower Materials that are not made available through the “Public Side Information” portion of the Platform and that may contain material non-public information with respect to the Company or its securities for purposes of United States Federal or state securities laws.

(f)Reliance by Administrative Agent and Lenders. The Administrative Agent and the Lenders shall be entitled to rely and act upon any notices (including telephonic or electronic Committed Loan Notices) believed in good faith to be given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Company shall indemnify the Administrative Agent, each Lender and the Related Parties of each of them from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice believed in good faith to be given by or on behalf of the Borrower. All telephonic notices to and other telephonic communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording.

10.03No Waiver; Cumulative Remedies; Enforcement.

No failure by any Lender or the Administrative Agent to exercise, and no delay by any such Person in exercising, any right, remedy, power or privilege hereunder or under any other Loan Document shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein

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provided, and provided under each other Loan Document, are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law.

Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Company shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance with Section 8.02 for the benefit of all the Lenders; provided, however, that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) any Lender from exercising setoff rights in accordance with Section 10.08 (subject to the terms of Section 2.11), or (c) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to the Company under any Debtor Relief Law; and provided, further, that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then (i) the Required Lenders shall have the rights otherwise ascribed to the Administrative Agent pursuant to Section 8.02 and (ii) in addition to the matters set forth in clauses (b) and (c) of the preceding proviso and subject to Section 2.11, any Lender may, with the consent of the Required Lenders, enforce any rights and remedies available to it and as authorized by the Required Lenders.

10.04Expenses; Indemnity; Damage Waiver.

(a)Costs and Expenses. The Company shall pay (i) all reasonable and documented out‑of‑pocket expenses incurred by the Administrative Agent and its Affiliates (including the reasonable and documented fees, charges and disbursements of counsel for the Administrative Agent), in connection with the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the transactions contemplated hereby or thereby shall be consummated) and (ii) all reasonable and documented out‑of‑pocket expenses incurred by the Administrative Agent or any Lender (including the fees, charges and disbursements of any counsel for the Administrative Agent or any Lender), and (iii) all fees and time charges for attorneys who may be employees of the Administrative Agent or any Lender, in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section, or (B) in connection with the Loans made hereunder, including all such out‑of‑pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.

(b)Indemnification by the Company. The Company shall indemnify the Administrative Agent (and any sub-agent thereof) and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the fees, charges and disbursements of any counsel for any Indemnitee), and shall indemnify and hold harmless each Indemnitee from all fees and time charges and disbursements for attorneys who may be employees of any Indemnitee, incurred by any Indemnitee or asserted against any Indemnitee by any Person (including the Company) other than such Indemnitee and its Related Parties arising out of, in

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connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder, the consummation of the transactions contemplated hereby or thereby, or, in the case of the Administrative Agent (and any sub-agent thereof) and its Related Parties only, the administration of this Agreement and the other Loan Documents, (ii) any Loan or the use or proposed use of the proceeds therefrom or (iii) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing (including without limitation any such claim, litigation or proceeding arising from any sale or distribution of securities by the Borrower or Borrower Parent), whether based on contract, tort or any other theory, whether brought by a third party or by the Company, and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the fraud, gross negligence or willful misconduct of such Indemnitee, (y) result from a claim brought by the Company against an Indemnitee for breach in bad faith of such Indemnitee’s obligations hereunder or under any other Loan Document, if the Company has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction, or (z) result from a claim, litigation, investigation or proceeding solely between Indemnitees and not involving the Company. Without limiting the provisions of Section 3.01(c), this Section 10.04(b) shall not apply with respect to Taxes other than any Taxes that represent losses, claims, damages, etc. arising from any non-Tax claim. The Company shall not have any liability hereunder to any Indemnitee to the extent an Indemnitee effects any settlement of a matter that is (or could be) subject to indemnification hereunder without the prior written consent of the Company, such consent not to be unreasonably withheld.

(c)Reimbursement by Lenders. To the extent that the Company for any reason fails to indefeasibly pay any amount required under subsection (a) or (b) of this Section to be paid by it to the Administrative Agent (or any sub-agent thereof), each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought based on each Lender’s share of the Total Credit Exposure at such time) of such unpaid amount (including any such unpaid amount in respect of a claim asserted by such Lender), such payment to be made severally among them based on such Lender’s Applicable Percentage (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought), providedfurther that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent). The obligations of the Lenders under this subsection (c) are subject to the provisions of Section 2.10(d).

(d)Waiver of Consequential Damages, Etc. To the fullest extent permitted by applicable law, no Person party hereto shall assert, and hereby waives, and acknowledges that no other Person shall have, any claim against any such Person party hereto or Indemnitee, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby,

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any Loan or the use of the proceeds thereof. No Indemnitee referred to in subsection (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed to such unintended recipients by such Indemnitee through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby other than for direct or actual damages resulting from the gross negligence or willful misconduct of such Indemnitee as determined by a final and nonappealable judgment of a court of competent jurisdiction.

(e)Payments. All amounts due under this Section shall be payable not later than ten Business Days after demand therefor.

(f)Sufficiency of Remedies.

Borrower hereby acknowledges that (i) any and all claims, damages and demands against any Lender or the Administrative Agent arising out of, or in connection with, the exercise by such Person of any of such Person’s rights or remedies, as a secured party, under the Facility following an Event of Default can be sufficiently and adequately remedied by monetary damages, (ii) no irreparable injury will be caused to the Borrower or the Investment Adviser as a result of, or in connection with, any such claims, damages or demands, and (iii) no equitable or injunctive relief shall be sought by the Borrower or the Investment Adviser as a result of, or in connection with, any such claims, damages or demands.

(g)Survival. The agreements in this Section and the indemnity provisions of Section 10.02(f) shall survive the resignation of the Administrative Agent, the replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations.

10.05Payments Set Aside.

To the extent that any payment by or on behalf of the Borrower is made to the Administrative Agent, any Lender, or the Administrative Agent any Lender exercises its right of setoff, and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such setoff had not occurred, and (b) each Lender severally agrees to pay to the Administrative Agent upon demand its applicable share (without duplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such payment is made at a rate per annum equal to the applicable Overnight Rate from time to time in effect, in the applicable currency of such recovery or payment. The obligations of the Lenders under clause (b) of the preceding sentence shall survive the payment in full of the Obligations and the termination of this Agreement.

10.06Successors and Assigns.

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(a)Successors and Assigns Generally. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Company may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an assignee in accordance with the provisions of subsection (b) of this Section, (ii) by way of participation in accordance with the provisions of subsection (d) of this Section, or (iii) by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) of this Section (and any other attempted assignment or transfer by any party hereto shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section and, to the extent expressly contemplated hereby, the Related Parties of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it); provided that any such assignment shall be subject to the following conditions:

(i)Minimum Amounts.

(A)in the case of an assignment of the entire remaining amount of the assigning Lender’s Commitment or contemporaneous assignments to related Approved Funds that equal at least the amount specified in paragraph (b)(i)(B) of this Section in the aggregate and the Loans at the time owing to it or in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund, no minimum amount need be assigned; and

(B)in any case not described in subsection (b)(i)(A) of this Section, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment, determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date, shall not be less than $5,000,000 unless each of the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Company otherwise consents (each such consent not to be unreasonably withheld or delayed).

(ii)Proportionate Amounts. Each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loans or the Commitment assigned;

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(iii)Required Consents. No consent shall be required for any syndication and/or assignment except to the extent required by subsection (b)(i)(B)of this Section and, in addition:

(A)the consent of the Borrower (such consent not to be unreasonably withheld or delayed, unless the Borrower establishes that such syndication or assignment would impose additional costs or obligations on the Borrower or the Investment Adviser, in which case such consent shall be in the sole discretion of Borrower unless Borrower is compensated to its satisfaction for any such costs or obligations) shall be required in the event that Bank of America, in its capacity as initial Lender, proposes to syndicate or assign all or a portion of its rights and obligations under this Agreement, or any subsequent Lender proposes to assign all or a portion of its rights and obligations under this Agreement, unless an Event of Default has occurred and is continuing at the time of such syndication or assignment; provided that the Company shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within five (5) days after having received notice thereof; and provided,further, that the Borrower shall use reasonable efforts to cooperate with the Lenders in connection with obtaining any rating for the Facility from a rating agency, it being understood and agreed that the Borrower shall not be responsible for any costs or expenses in connection with obtaining any such rating.

(B)the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed) shall be required if such assignment is to a Person that is not a Lender, an Affiliate of such Lender or an Approved Fund with respect to such Lender.

(iv)Assignment and Assumption. The parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee in the amount of $3,500; provided, however, that the Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment. The assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire.

(v)No Assignment to Certain Persons. No such assignment shall be made (A) to the Company or any of the Company’s Affiliates, (B) to any Defaulting Lender or any of its subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (B) or (C) to a natural Person (any such Person described in clause (A), (B) or (C), a “Disqualified Lender”). Any purported assignment to any Disqualified Lender will be of no force and effect.

(vi)Certain Additional Payments. In connection with any assignment of rights and obligations of any Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate amount sufficient, upon distribution thereof as appropriate (which may be outright

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payment, purchases by the assignee of participations or subparticipations, or other compensating actions, including funding, with the consent of the Company and the Administrative Agent, the applicable pro rata share of Loans previously requested but not funded by the Defaulting Lender, to each of which the applicable assignee and assignor hereby irrevocably consent), to (x) pay and satisfy in full all payment liabilities then owed by such Defaulting Lender to the Administrative Agent or any Lender hereunder (and interest accrued thereon) and (y) acquire (and fund as appropriate) its full pro rata share of all Loans accordance with its Applicable Percentage. Notwithstanding the foregoing, in the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a Defaulting Lender for all purposes of this Agreement until such compliance occurs.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to subsection (c) of this Section, from and after the effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05, and 10.04 with respect to facts and circumstances occurring prior to the effective date of such assignment; provided, that except to the extent otherwise expressly agreed by the affected parties, no assignment by a Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender. Upon request, the Borrower (at its expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section.

(c)Register. The Administrative Agent, acting solely for this purpose as an agent of the Borrower, shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption delivered to it (or the equivalent thereof in electronic form) and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the Register shall be conclusive absent manifest error, and the Borrower, the Administrative Agent and the Lenders shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement. The Register shall be available for inspection by the Borrower and any Lender, at any reasonable time and from time to time upon reasonable prior notice.

(d)Participations. Any Lender may at any time, without the consent of, or notice to, the Borrower or the Administrative Agent, sell participations to any Person (other than a Disqualified Lender) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under

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this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) the Borrower, the Administrative Agent and the Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. For the avoidance of doubt, each Lender shall be responsible for the indemnity under Section 10.04(c) without regard to the existence of any participation.

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and to approve any amendment, modification or waiver of any provision of this Agreement; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or other modification described in the first proviso to Section 10.01 that affects such Participant. The Company agrees that each Participant shall be entitled to the benefits of Sections 3.01, 3.04 and 3.05 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to subsection (b) of this Section (subject to the limitations and requirements therein, including the requirements of Section 3.01(e); it being understood that the documentation required under Section 3.01(e) shall be delivered to the Lender who sells the participation) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section; provided that such Participant (A) agrees to be subject to the provisions of Sections 3.06 and 10.13 as if it were an assignee under paragraph (b) of this Section and (B) shall not be entitled to receive any greater payment under Sections 3.01 or 3.04, with respect to any participation, than the Lender from whom it acquired the applicable participation would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation and the same greater payment would also have applied to the relevant Lender. Each Lender that sells a participation agrees, at the Company’s request and expense, to use reasonable efforts to cooperate with the Company to effectuate the provisions of Section 3.06 with respect to any Participant. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender; provided that such Participant agrees to be subject to Section 2.11 as though it were a Lender. Each Lender that sells a participation shall, acting solely for this purpose as an agent of the Company, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that such commitment, loan or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. For the avoidance of doubt, the Administrative Agent (in its capacity as Administrative Agent) shall have no responsibility for maintaining a Participant Register.

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(e)Certain Pledges. Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement (including under its Note, if any) to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party hereto.

Notwithstanding anything to the contrary set forth herein or in any other Loan Document, each Lender hereunder, and each Participant, must at all times be a “qualified purchaser” as defined in the Investment Company Act (a “Qualified Purchaser”). Accordingly:

(i)    each Lender represents to the Borrower, (A) on the date that it becomes a party to this Agreement (whether by being a signatory hereto or by entering into an Assignment and Assumption) and (B) on each date on which it makes a Credit Extension hereunder, that it is a Qualified Purchaser;

(ii)    each Lender agrees that it shall not assign, or grant any participations in, any of its rights or obligations under this Agreement to any Person unless such Person is a Qualified Purchaser; and

(iii)    the Borrower agrees that, to the extent it has the right to consent to any assignment or participation herein, it shall not consent to such assignment or participation hereunder unless it reasonably believes that the assignee or participant is a Qualified Purchaser at the time of such assignment or participation and that such assignment or participation will not cause the Borrower or the pool of Collateral to be required to register as an investment company under the Investment Company Act.

10.07Treatment of Certain Information; Confidentiality.

Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its Related Parties (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent required or requested by any regulatory authority purporting to have jurisdiction over such Person or its Related Parties (including any self-regulatory authority, such as the National Association of Insurance Commissioners), (c) to the extent required by applicable laws or regulations or by any subpoena or similar legal process, (d) to any other party hereto, (e) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (f) subject to an agreement containing provisions substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights and obligations under this Agreement or any Eligible Assignee invited to be a Lender pursuant to Section 10.01 or (ii) any actual or prospective party (or its Related Parties) to any swap, derivative or other transaction under which payments are to be made by reference to any of the Borrower and their obligations, this Agreement or payments hereunder, (g) on a confidential basis to (i) any rating agency in connection with rating

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the Company or the credit facilities provided hereunder or (ii) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers or other market identifiers with respect to the credit facilities provided hereunder, (h) with the consent of the Company or (i) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative Agent, any Lender or any of their respective Affiliates on a nonconfidential basis from a source other than the Company. “Information” means all information received from the Company relating to the Company, other than any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the Company. Any Person required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to do so if such Person has exercised the same degree of care to maintain the confidentiality of such Information as such Person would accord to its own confidential information.

Each of the Administrative Agent and the Lenders acknowledges that (a) the Information may include material non-public information concerning the Company and any obligors in respect of the Collateral Assets, (b) it has developed compliance procedures regarding the use of material non-public information and (c) it will handle such material non-public information in accordance with applicable Law, including United States Federal and state securities Laws.

10.08Right of Setoff.

If an Event of Default shall have occurred and be continuing, each Lender and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender or any such Affiliate to or for the credit or the account of the Company against any and all of the obligations of the Company now or hereafter existing under this Agreement or any other Loan Document to such Lender or its Affiliates, irrespective of whether or not such Lender or Affiliate shall have made any demand under this Agreement or any other Loan Document and although such obligations of the Company may be contingent or unmatured or are owed to a branch, office or Affiliate of such Lender different from the branch, office or Affiliate holding such deposit or obligated on such indebtedness; provided, that in the event that any Defaulting Lender shall exercise any such right of setoff, (x) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with the provisions of Section 2.12 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (y) the Defaulting Lender shall provide promptly to the Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The rights of each Lender and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff) that such Lender or its Affiliates may have. Each Lender agrees to notify the Company and the Administrative Agent promptly after any such setoff and application, provided that the failure to give such notice shall not affect the validity of such setoff and application.

10.09Interest Rate Limitation.

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Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable Law (the “Maximum Rate”). If the Administrative Agent or any Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Company. In determining whether the interest contracted for, charged, or received by the Administrative Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

10.10Counterparts; Integration; Effectiveness.

This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan Documents, and any separate letter agreements with respect to fees payable to the Administrative Agent, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto. Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Agreement.

10.11Survival of Representations and Warranties.

All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any Credit Extension, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid.

10.12Severability.

If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular

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jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 10.12, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, then such provisions shall be deemed to be in effect only to the extent not so limited.

10.13Replacement of Lenders.

If the Company is entitled to replace a Lender pursuant to the provisions of Section 3.06, or if any Lender is a Defaulting Lender or a Non-Consenting Lender, then the Company may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.06), all of its interests, rights (other than its existing rights to payments pursuant to Sections 3.01 and 3.04) and obligations under this Agreement and the related Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment), provided that:

(a)the Company shall have paid to the Administrative Agent the assignment fee (if any) to the extent required by the Administrative Agent pursuant to Section 10.06(b);

(b)such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 3.05) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Company (in the case of all other amounts);

(c)in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter;

(d)such assignment does not conflict with applicable Laws; and

(e)    in the case of an assignment resulting from a Lender becoming a Non-Consenting Lender, the applicable assignee shall have consented to the applicable amendment, waiver or consent.

A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or otherwise, the circumstances entitling the Company to require such assignment and delegation cease to apply.

10.14Governing Law; Jurisdiction; Etc.

(a)GOVERNING LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT (EXCEPT, AS

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TO ANY OTHER LOAN DOCUMENT, AS EXPRESSLY SET FORTH THEREIN) AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(b)SUBMISSION TO JURISDICTION. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY AGREES THAT IT WILL NOT COMMENCE ANY ACTION, LITIGATION OR PROCEEDING OF ANY KIND OR DESCRIPTION, WHETHER IN LAW OR EQUITY, WHETHER IN CONTRACT OR IN TORT OR OTHERWISE, AGAINST ANY OTHER PARTY HERETO OR ANY RELATED PARTY OF THE FOREGOING IN ANY WAY RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS RELATING HERETO OR THERETO, IN ANY FORUM OTHER THAN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF NEW YORK, AND ANY APPELLATE COURT FROM ANY THEREOF, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION, LITIGATION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION, LITIGATION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. NOTHING IN THIS AGREEMENT OR IN ANY OTHER LOAN DOCUMENT SHALL AFFECT ANY RIGHT THAT THE ADMINISTRATIVE AGENT, ANY LENDER MAY OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AGAINST THE COMPANY OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

(c)WAIVER OF VENUE. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (B) OF THIS SECTION. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.

(d)SERVICE OF PROCESS. EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.

10.15Waiver of Jury Trial.

EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY

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JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

10.16No Advisory or Fiduciary Responsibility.

In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), the Company acknowledges and agrees, and acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and other services regarding this Agreement provided by the Administrative Agent the Arranger, and the Lenders are arm’s-length commercial transactions between the Company and its Affiliates, on the one hand, and the Administrative Agent, the Arranger and the Lenders, on the other hand, (B)  the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the Company is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) the Administrative Agent, the Arranger and each Lender is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Company or any of its Affiliates, or any other Person and (B) neither the Administrative Agent, the Arranger nor any Lender has any obligation to the Company or any of its Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Administrative Agent, the Arranger and the Lenders and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company and its Affiliates, and neither the Administrative Agent, the Arranger nor any Lender has any obligation to disclose any of such interests to the Company or any of its Affiliates. To the fullest extent permitted by law, each of the Company hereby waives and releases any claims that it may have against the Administrative Agent, the Arranger or any Lender with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.

10.17Electronic Execution of Assignments and Certain Other Documents.

The words “execute,” “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption or in any amendment or other modification hereof (including waivers and consents) shall be deemed to include electronic signatures, the electronic matching of assignment terms and contract formations on electronic platforms approved by the Administrative Agent, or the keeping of records in electronic form, each of which shall be of the same legal effect, validity

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or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

10.18USA PATRIOT Act.

Each Lender that is subject to the Act (as hereinafter defined) and the Administrative Agent (for itself and not on behalf of any Lender) hereby notifies the Borrower that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it is required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender or the Administrative Agent, as applicable, to identify the Borrower in accordance with the Act. The Borrower shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer” and anti-money laundering rules and regulations, including the Act.

10.19Compliance with Laws.

Borrower acknowledges that Bank of America’s obligations hereunder shall be subject to all Laws and, without limitation, the Loan Documents shall not limit the ability of Bank of America to take any actions that it determines, in the exercise of its sole discretion, to be necessary or advisable to comply fully and prudently with any Law, including without limitation any regulatory margin requirement.

10.20Non-Recourse Obligations; No Petition.

(a)    Each Lender and the Administrative Agent covenants and agrees that the obligations of the Borrower under this Agreement are limited recourse obligations of the Borrower, payable solely from the Collateral in accordance with the terms of the Loan Documents, and, following realization of the Collateral, any claims of the Lenders and the Administrative Agent and all obligations of the Borrower shall be extinguished and shall not thereafter revive. It is understood that the foregoing provisions of this Section 10.20(a) shall not (i) prevent recourse to the Collateral for the sums due or to become due under any security, instrument or agreement which is part of the Collateral, or (ii) constitute a waiver, release or discharge of any indebtedness or obligation evidenced by this Agreement until the Collateral has been realized, whereupon any outstanding indebtedness or obligation shall be extinguished and shall not thereafter revive. For the avoidance of doubt, this Section 10.20(a) shall not limit or prejudice the rights of the Lenders in respect of any obligation of any Affiliate of the Borrower under any Loan Document or otherwise.

(b)    Each of the parties hereto (other than the Borrower) covenants and agrees that, prior to the date that is one year and one day (or, if longer, any applicable preference period and one day) after the payment in full of all Obligations, no party hereto shall institute against, or join any other Person in instituting against, the Borrower any bankruptcy, reorganization, arrangement, insolvency

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or liquidation proceedings or other similar proceedings under any federal, state or foreign bankruptcy or similar law.

The provisions of this Section 10.20 shall survive the termination of this Agreement.

10.21Time of the Essence.

Time is of the essence of the Loan Documents.

10.22Judgment Currency.

If, for the purposes of obtaining judgment in any court, it is necessary to convert a sum due hereunder or any other Loan Document in one currency into another currency, the rate of exchange used shall be that at which in accordance with normal banking procedures the Administrative Agent could purchase the first currency with such other currency on the Business Day preceding that on which final judgment is given. The obligation of the Borrower in respect of any such sum due from it to the Administrative Agent or any Lender hereunder or under the other Loan Documents shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than that in which such sum is denominated in accordance with the applicable provisions of this Agreement (the “Agreement Currency”), be discharged only to the extent that on the Business Day following receipt by the Administrative Agent or such Lender, as the case may be, of any sum adjudged to be so due in the Judgment Currency, the Administrative Agent or such Lender, as the case may be, may in accordance with normal banking procedures purchase the Agreement Currency with the Judgment Currency. If the amount of the Agreement Currency so purchased is less than the sum originally due to the Administrative Agent or any Lender from the Borrower in the Agreement Currency, the Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Administrative Agent or such Lender, as the case may be, against such loss. If the amount of the Agreement Currency so purchased is greater than the sum originally due to the Administrative Agent or any Lender in such currency, the Administrative Agent or such Lender, as the case may be, agrees to return the amount of any excess to the Borrower (or to any other Person who may be entitled thereto under applicable law).

[Remainder of page intentionally left blank.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

ACSF FUNDING I, LLC

By: American Capital ACSF Management, LLC, its designated manager

By: /s/ Samuel A. Flax    

Name: Samuel A. Flax    

Title: Executive Vice President and Secretary    

S - 1    

BANK OF AMERICA, N.A., as
Administrative Agent

By: /s/ Allen D. Shifflet    

Name: Allen D. Shifflet    

Title: Managing Director    

S - 2    

BANK OF AMERICA, N.A., as a Lender

By: /s/ Allen D. Shifflet    

Name: Allen D. Shifflet    

Title: Managing Director    

S - 3    

SCHEDULE 2.01

COMMITMENTS
AND APPLICABLE PERCENTAGES

Lender	Total Commitment	Applicable Percentage
Bank of America, N.A.	(i) Prior to the Second Closing Date, $140,000,000, (ii) on and after the Second Closing Date and prior to the Upsize Date, $135,000,000 and (iii) on and after the Upsize Date, $140,000,000	100.000000000%
Total	(i) Prior to the Second Closing Date, $140,000,000, (ii) on and after the Second Closing Date and prior to the Upsize Date, $135,000,000 and (iii) on and after the Upsize Date, $140,000,000	100.000000000%

Schedule 2.01

Page 1

SCHEDULE 5.07

CERTAIN CONTRACTUAL OBLIGATIONS

None.

Schedule 5.07

Page 1

SCHEDULE 5.15

IDENTIFICATION INFORMATION OF

BORROWER AND BORROWER PARENT

Legal Name:	ACSF Funding I, LLC
Identification Number:
Jurisdiction of Organization:	Delaware
Registered Office:	Corporate Trust Center 1209 Orange Street Wilmington, Delaware 19801
Place of Business	c/o American Capital Senior Floating, Ltd. 2 Bethesda Metro Center, 14th Floor Bethesda, Maryland 20814
Former Legal Name:	None
Investment Adviser Place of Business/ Chief Executive Office:	American Capital ACSF Management, LLC 2 Bethesda Metro Center, 14th Floor Bethesda, Maryland 20814
U.S. Taxpayer Identification Number (Borrower)
U.S. Taxpayer Identification Number (Borrower Parent)

Schedule 5.15

Page 1

SCHEDULE 10.02

ADMINISTRATIVE AGENT’S OFFICE;
CERTAIN ADDRESSES FOR NOTICES

COMPANY:

ACSF Funding I, LLC

2 Bethesda Metro Center, 14^th Floor

Bethesda, MD 20814

Attn: Secretary

ADMINISTRATIVE AGENT:

Administrative Agent’s Office

(for payments and Requests for Credit Extensions):

Bank of America, N.A.

Street Address: 101 S Tryon Street

Mail Code: NC1-002-15-61

Charlotte, NC 28255

Attention: Bank of America Credit Services

Telephone:

Facsimile No:

Electronic Mail:

Payment Instructions

USD

Bank of America, N.A.

ABA#:

Corporate Credit Services

Acct. #

Reference:

1

EXHIBIT A

FORM OF COMMITTED LOAN NOTICE

Date: ___________, _____

To:    Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of December __, 2013 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among ACSF Funding I, LLC, a limited liability company organized under Delaware law (the “Company”), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.

The Investment Adviser, on behalf of the Company, hereby requests (select one):

A Borrowing of Committed Loans A conversion or continuation of Loans

1.    On (a Business Day).

2.    In the amount of $.

3.    Comprised of .

[Type of Committed Loan requested]

4.    For Eurocurrency Rate Loans: with an Interest Period of [one week / two weeks / one month / three months / six months.

The Committed Borrowing, if any, requested herein complies with the provisos to the first sentence of Section 2.01 of the Agreement.

After giving effect to such Committed Borrowing (which, for the avoidance of doubt, does not include any conversion or continuation of Loans): (A) (i) no Borrowing Base Deficiency will exist and (ii) no Default would occur or be continuing, in each case based on the most recent Borrowing Base determination received from the Administrative Agent and (B) in the case of any Loan, the proceeds of such Loan will be used solely for Permitted Uses.

To the knowledge of the undersigned, the representations and warranties of the Company contained in Article V of the Agreement, and any representations and warranties of the Company that are contained in any document furnished at any time under or in connection with the Loan Documents, (I) to the extent already qualified with respect to “material” matters or “Material Adverse Effect”, are true and correct on and as of the date hereof and (II) to the extent not already qualified with respect to “material” matters or “Material Adverse Effect”, are true and correct on and as of

A-1

Form of Committed Loan Notice

the date hereof in all material respects, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct (in all material respects, as applicable) as of such earlier date, and the representations and warranties contained in subsections (a) and (b) of Section 5.05 of the Agreement shall be deemed to refer to the most recent statements furnished pursuant to subsections (a) and (b), respectively, of Section 6.01 of the Agreement.

To the knowledge of the undersigned, since the date of the last year-end audited financial statements required by Section 6.01(a) of the Agreement, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect (other than a Collateral Value Condition).

[Remainder of page intentionally left blank.]

A-1

Form of Committed Loan Notice

[BORROWER INVESTMENT ADVISER]

By:

Name:

Title:

A-1

Form of Committed Loan Notice

EXHIBIT B

FORM OF NOTE

FOR VALUE RECEIVED, the undersigned (the “Borrower”) hereby promises to pay to _____________________ or registered assigns (the “Lender”), in accordance with the provisions of the Agreement (as hereinafter defined), the principal amount of each Loan from time to time made by the Lender to the Borrower under that certain Credit Agreement, dated as of December __, 2013 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among ACSF Funding I, LLC, the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.

The Borrower promises to pay interest on the unpaid principal amount of each Loan from the date of such Loan until such principal amount is paid in full, at such interest rates and at such times as provided in the Agreement. All payments of principal and interest shall be made to the Administrative Agent for the account of the Lender in the currency in which such Committed Loan is denominated and in Same Day Funds at the Administrative Agent’s Office for such currency. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the per annum rate set forth in the Agreement.

This Note is one of the Notes referred to in the Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part subject to the terms and conditions provided therein. This Note is also secured by the Collateral. Upon the occurrence and continuation of one or more of the Events of Default specified in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Agreement. Loans made by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of business. The Lender may also attach schedules to this Note and endorse thereon the date, amount and maturity of its Loans and payments with respect thereto.

The Borrower, for itself, its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note.

[Remainder of page intentionally left blank.]

B - 1

Form of Note

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

ACSF FUNDING I, LLC

By: American Capital ACSF Management, LLC, its designated manager

Name:

Title:

B - 2

Form of Note

LOANS AND PAYMENTS WITH RESPECT THERETO

Date Type of Loan Made Amount of Loan Made End of Interest Period Amount of Principal or Interest Paid This Date Outstanding Principal Balance This Date Notation Made By

B - 3

Form of Note

EXHIBIT C-1

ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (this “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [the][each] Assignor identified in item 1 below ([the][each, an] “Assignor”) and [the][each] Assignee identified in item 2 below ([the][each, an] “Assignee”). [It is understood and agreed that the rights and obligations of [the Assignors][the Assignees] hereunder are several and not joint.] Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement identified below (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Credit Agreement”), receipt of a copy of which is hereby acknowledged by the Assignee. The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, [the][each] Assignor hereby irrevocably sells and assigns to [the Assignee][the respective Assignees], and [the][each] Assignee hereby irrevocably purchases and assumes from [the Assignor][the respective Assignors], subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below (i) all of [the Assignor’s][the respective Assignors’] rights and obligations in [its capacity as a Lender][their respective capacities as Lenders] under the Credit Agreement and any other documents or instruments delivered pursuant thereto in the amount[s] and equal to the percentage interest[s] identified below of all the outstanding rights and obligations under the respective facilities identified below and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of [the Assignor (in its capacity as a Lender)][the respective Assignors (in their respective capacities as Lenders)] against any Person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned by [the][any] Assignor to [the][any] Assignee pursuant to clauses (i) and (ii) above being referred to herein collectively as [the][an] “Assigned Interest”). Each such sale and assignment is without recourse to [the][any] Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by [the][any] Assignor.

1.    Assignor[s]:    ______________________________

______________________________

Assignor [is] [is not] a Defaulting Lender]

2. Assignee[s]:    ______________________________

______________________________

[for each Assignee, indicate [Affiliate][Approved Fund] of [identify Lender]]

C-1 - 1

Form of Assignment and Assumption

3.    Borrower:    ACSF Funding I, LLC

4. Administrative Agent: Bank of America, N.A., as the administrative agent under the Credit Agreement

5. Credit Agreement:    Credit Agreement, dated as of December __,2013, among ACSF Funding I, LLC, the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent

6.    Assigned Interest:

Assignor[s]	Assignee[s]	Aggregate Amount of Commitment for all Lenders	Amount of Commit-ment Assigned	Percentage Assigned of Commitment
		$________________	$_________	____________%
		$________________	$_________	____________%
		$________________	$_________	____________%

[7.    Trade Date:    __________________]

Effective Date: __________________, 20__ [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.]

The terms set forth in this Assignment and Assumption are hereby agreed to:

ASSIGNOR[S]

[NAME OF ASSIGNOR]

By: _____________________________

Title:

[NAME OF ASSIGNOR]

By: _____________________________

Title:

ASSIGNEE[S]

[NAME OF ASSIGNEE]

By: _____________________________

Title:

C-1 - 2

Form of Assignment and Assumption

[NAME OF ASSIGNEE]

By: _____________________________

Title:

Consented to and Accepted:

BANK OF AMERICA, N.A., as

Administrative Agent

By: _________________________________

Title:

ACSF FUNDING I, LLC, as Borrower

By: American Capital ACSF Management, LLC,

its designated manager

By: _________________________________

Title:

C-1 - 3

Form of Assignment and Assumption

ANNEX 1 TO ASSIGNMENT AND ASSUMPTION

[___________________]

STANDARD TERMS AND CONDITIONS FOR

ASSIGNMENT AND ASSUMPTION

1.    Representations and Warranties.

1.1.    Assignor. [The][Each] Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of [the][the relevant] Assigned Interest, (ii) [the][such] Assigned Interest is free and clear of any lien, encumbrance or other adverse claim, (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and (iv) it is [not] a Defaulting Lender; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of the Company, any of its Affiliates or any other Person obligated in respect of any Loan Document or (iv) the performance or observance by the Company, any of Affiliates or any other Person of any of their respective obligations under any Loan Document.

1.2.    Assignee. [The][Each] Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all the requirements to be an assignee under Section 10.06(b)(iii) and (v) of the Credit Agreement (subject to such consents, if any, as may be required under Section 10.06(b)(iii) of the Credit Agreement), (iii) from and after the Effective Date, it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of [the][the relevant] Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by [the][such] Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire [the][such] Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, and has received or has been accorded the opportunity to receive copies of the most recent financial statements delivered pursuant to Section 6.01 thereof, as applicable, and such other documents and information as it deems appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase [the][such] Assigned Interest, (vi) it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Assignment and Assumption and to purchase [the][such] Assigned Interest and (vii) it is not a Disqualified Lender; and (b) agrees that (i) it will, independently and without reliance upon the Administrative Agent, [the][any] Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations which by the terms of the Loan Documents are required to be performed by it as a Lender.

C-1 - 4

Form of Assignment and Assumption

THE ASSIGNEE, BY CHECKING THE BOX BELOW, (I) ACKNOWLEDGES THAT IT IS REQUIRED TO BE A QUALIFIED PURCHASER FOR PURPOSES OF THE INVESTMENT COMPANY ACT AT THE TIME IT BECOMES A LENDER AND ON EACH DATE ON WHICH A CREDIT EXTENSION IS MADE UNDER THE CREDIT AGREEMENT AND (II) REPRESENTS AND WARRANTS TO THE ASSIGNOR, THE BORROWER AND THE ADMINISTRATIVE AGENT THAT THE ASSIGNEE IS A QUALIFIED PURCHASER:

BY CHECKING THIS BOX, THE ASSIGNEE REPRESENTS AND WARRANTS THAT IT IS A QUALIFIED PURCHASER.

2.    Payments. From and after the Effective Date, the Administrative Agent shall make all payments in respect of [the][each] Assigned Interest (including payments of principal, interest, fees and other amounts) to [the][the relevant] Assignor for amounts which have accrued to but excluding the Effective Date and to [the][the relevant] Assignee for amounts which have accrued from and after the Effective Date. Notwithstanding the foregoing, the Administrative Agent shall make all payments of interest, fees or other amounts paid or payable in kind from and after the Effective Date to [the][the relevant] Assignee.

3.    General Provisions. This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns. This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument. Delivery of an executed counterpart of a signature page of this Assignment and Assumption by facsimile or other electronic imaging means (e.g. “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption. This Assignment and Assumption shall be governed by, and construed in accordance with, the law of the State of New York.

C-1 - 5

Form of Assignment and Assumption

EXHIBIT C-2

FORM OF ADMINISTRATIVE QUESTIONNAIRE

1.Borrower or Deal Name__________________________________________________________________

E-mail this document with your commitment letter to: ______________________________________________

E-mail address of recipient: ____________________________________________________________________

2. Legal Name of Lender of Record for Signature Page: __________________________________________

Markit Entity Identifier (MEI) # ______________________________________________________________

Fund Manager Name (if applicable) ___________________________________________________________

Legal Address from Tax Document of Lender of Record:

Country _________________________________________________________________________________

Address _________________________________________________________________________________

City ________________________________ State/Province________________ Country ________________

3. Domestic Funding Address:4. Eurodollar Funding Address:

Street Address     Street Address

Suite/ Mail Code         Suite/ Mail Code

City State         City State

Postal Code Country         Postal Code Country

5. Credit Contact Information:

Syndicate level information (which may contain material non-public information about the Borrower and its related parties or their respective securities will be made available to the Credit Contact(s).  The Credit Contacts identified must be able to receive such information in accordance with his/her institution's compliance procedures and applicable laws, including Federal and State securities laws.

Primary Credit Contact:

First Name    ________________________________________________________________________

Middle Name    ________________________________________________________________________

Last Name    ________________________________________________________________________

Title    ________________________________________________________________________

Street Address    ________________________________________________________________________

Suite/Mail Code    ________________________________________________________________________

City    ________________________________________________________________________

State    ________________________________________________________________________

Postal Code    ________________________________________________________________________

Country    ________________________________________________________________________

Office Telephone #    ________________________________________________________________________

Office Facsimile #    ________________________________________________________________________

Work E-Mail Address    ________________________________________________________________________

C – 2 - 1

Form of Administrative Questionnaire

IntraLinks/SyndTrak

E-Mail Address    ________________________________________________________________________

Secondary Credit Contact:

First Name    ________________________________________________________________________

Middle Name    ________________________________________________________________________

Last Name    ________________________________________________________________________

Title    ________________________________________________________________________

Street Address    ________________________________________________________________________

Suite/Mail Code    ________________________________________________________________________

City    ________________________________________________________________________

State    ________________________________________________________________________

Postal Code    ________________________________________________________________________

Country    ________________________________________________________________________

Office Telephone #    ________________________________________________________________________

Office Facsimile #    ________________________________________________________________________

Work E-Mail Address    ________________________________________________________________________

IntraLinks/SyndTrak

E-Mail Address        ________________________________________________________________________

Primary Operations Contact:Secondary Operations Contact:

First MI Last First MI Last ________________

Title Title

Street Address ___ Street Address

Suite/ Mail Code ___ Suite/ Mail Code

City State ___ City State

Postal Code Country ___ Postal Code Country

Telephone Facsimile ___ Telephone Facsimile    

E-Mail Address E-Mail Address

IntraLinks/SyndTrak E-Mail IntraLinks/SyndTrak E-Mail

Address Address

Does Secondary Operations Contact need copy of notices? ___YES ___ NO    

Letter of Credit Contact:Draft Documentation Contact or Legal Counsel:

First MI Last First MI Last _________________

Title Title

Street Address Street Address

Suite/ Mail Code Suite/ Mail Code

City State City State

Postal Code Country Postal Code Country

Telephone Facsimile Telephone Facsimile    

E-Mail Address E-Mail Address

PLEASE CHECK IF YOU CAN FUND IN THE CURRENCIES REQUIRED FOR THIS TRANSACTION LISTED BELOW:

___ US DOLLAR___     ___         ___

C – 2 - 2

Form of Administrative Questionnaire

___ US DOLLAR___     ___         ___

___ US DOLLAR___     ___         ___

PLEASE CHECK IF YOU CAN FUND IN THE JURISDICTIONS LISTED BELOW:

___ ___     ___         ___

___ ___     ___         ___

___ ___     ___         ___

6. Lender’s Fed Wire Payment Instructions:

Pay to:        

Bank Name

ABA #

City State

Account #

Account Name

Attention

7. Lender’s Standby Letter of Credit, Commercial Letter of Credit, and Bankers’ Acceptance Fed Wire Payment Instructions (if applicable):

Pay to:        

Bank Name

ABA #

City State

Account #

Account Name

Attention

C – 2 - 3

Form of Administrative Questionnaire

Can the Lender’s Fed Wire Payment Instructions in Section 6 be used? ___YES ___ NO

8. Lender’s Organizational Structure and Tax Status

Please refer to the enclosed withholding tax instructions below and then complete this section accordingly:

Lender Taxpayer Identification Number (TIN):    ___ ___ - ___ ___ ___ ___ ___

Tax Withholding Form Delivered to Bank of America (check applicable one):

___ W-9 ___ W-8BEN ___ W-8ECI W-8EXP W-8IMY

Tax Contact:

First MI Last ______________

Title

Street Address

Suite/ Mail Code

City State

Postal Code Country ________

Telephone Facsimile

E-Mail Address

C – 2 - 4

Form of Administrative Questionnaire

NON–U.S. LENDER INSTITUTIONS

1. Corporations:

If your institution is incorporated outside of the United States for U.S. federal income tax purposes, and is the beneficial owner of the interest and other income it receives, you must complete one of the following three tax forms, as applicable to your institution: a.) Form W-8BEN (Certificate of Foreign Status of Beneficial Owner), b.) Form W-8ECI (Income Effectively Connected to a U.S. Trade or Business), or c.) Form W-8EXP (Certificate of Foreign Government or Governmental Agency).

A U.S. taxpayer identification number is required for any institution submitting a Form W-8 ECI. It is also required on Form W-8BEN for certain institutions claiming the benefits of a tax treaty with the U.S. Please refer to the instructions when completing the form applicable to your institution. In addition, please be advised that U.S. tax regulations do not permit the acceptance of faxed forms. An original tax form must be submitted.

2. Flow-Through Entities

If your institution is organized outside the U.S., and is classified for U.S. federal income tax purposes as either a Partnership, Trust, Qualified or Non-Qualified Intermediary, or other non-U.S. flow-through entity, an original Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. branches for United States Tax Withholding) must be completed by the intermediary together with a withholding statement. Flow-through entities other than Qualified Intermediaries are required to include tax forms for each of the underlying beneficial owners.

Please refer to the instructions when completing this form. In addition, please be advised that U.S. tax regulations do not permit the acceptance of faxed forms. Original tax form(s) must be submitted.

U.S. LENDER INSTITUTIONS:

If your institution is incorporated or organized within the United States, you must complete and return Form W-9 (Request for Taxpayer Identification Number and Certification). Please be advised that we require an original form W-9.

Pursuant to the language contained in the tax section of the Credit Agreement, the applicable tax form for your institution must be completed and returned on or prior to the date on which your institution becomes a lender under this Credit Agreement. Failure to provide the proper tax form when requested will subject your institution to U.S. tax withholding.

SEE ATTACHMENT A TO THIS FORM OF ADMINISTRATIVE QUESTIONNAIRE FOR ADDITIONAL GUIDANCE AND INSTRUCTIONS AS TO WHERE TO SUBMIT THIS DOCUMENTATION.

10. Bank of America’s Payment Instructions:

Pay to:    Bank of America, N.A.

ABA # 026009593

New York, NY

Account #

Attn: Corporate Credit Services

Ref: Name of Facility

C – 2 - 5

Form of Administrative Questionnaire

EXHIBIT D-1

FORM OF COMPLIANCE CERTIFICATE (BORROWER PARENT)

Compliance Certificate Date: ,

Financial Statement Date: ,

To:    Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of December __, 2013 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among ACSF Funding I, LLC, a Delaware limited liability company (the “Borrower”), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.

The undersigned hereby certifies, as an officer and not in his/her individual capacity, as of the date hereof that he/she is the of American Capital Senior Floating, Ltd. (“Borrower Parent”), and that, as such, he/she is authorized to execute and deliver this Certificate to the Administrative Agent in such capacity on the behalf of Borrower Parent, and that:

[Use following paragraph 1 for fiscal year-end financial statements]

1.    The Borrower Parent has delivered the year-end audited financial statements required by Section 6.01(a) of the Agreement for the fiscal year of the Borrower Parent ended as of the above date, together with the report and opinion of an independent certified public accountant required by such section. Such financial statements are fairly stated in all material respects when considered in relation to the consolidated financial statements of the Borrower Parent prepared in accordance with GAAP as at such date and for such period.

[Use following paragraph 1 for fiscal quarter-end financial statements]

1.    The Borrower Parent has delivered the unaudited financial statements required by Section 6.01(b) of the Agreement for the fiscal quarter of the Borrower Parent ended as of the above date. Such financial statements fairly present in all material respects the financial condition, results of operations and cash flows of the Borrower Parent and its consolidated subsidiaries in accordance with GAAP as at such date and for such period, subject only to normal year-end audit adjustments and the absence of footnotes.

[For all reports:]

[2.    The changes in GAAP as applied by (or in the application of GAAP) by the Borrower Parent or Borrower that have occurred since the date of the last audited financial statements required by Section 6.01(a) of the Agreement are listed below. For each change, the effect of such change on the financial statements described in Paragraph 1 is specified with such change:]

D - 1 - 1

Form of Compliance Certificate (Borrower Parent)

IN WITNESS WHEREOF, the undersigned has executed this Certificate as

of , , in his/her capacity as an officer of Borrower Parent and not in his/her individual capacity.

AMERICAN CAPITAL SENIOR FLOATING, LTD.

By:

Name:

Title:

D - 1 - 2

Form of Compliance Certificate (Borrower Parent)

EXHIBIT D-2

FORM OF COMPLIANCE CERTIFICATE (BORROWER)

Financial Statement Date: ,

To:    Bank of America, N.A., as Administrative Agent

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement, dated as of December __, 2013 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), among ACSF Funding I, LLC, a Delaware limited liability company (the “Borrower”), the Lenders from time to time party thereto, and Bank of America, N.A., as Administrative Agent.

The undersigned hereby certifies, as an officer and not in his/her individual capacity, as of the date hereof that he/she is the of the Borrower, and that, as such, he/she is authorized to execute and deliver this Certificate to the Administrative Agent in such capacity on the behalf of the Borrower, and that:

[Use following paragraph 1 for monthly reports]

[1.]    The Borrower has delivered the Net Asset Value and, if any, the supporting calculations thereof required by Section 6.01(c) of the Agreement for the month of the Borrower ended as of the above date. Such Net Asset Value and supporting calculations thereof are true, accurate and complete in every material respect.

[Use following paragraphs for annual reports]

[1].    The undersigned has reviewed and is familiar with the terms of the Agreement and has made, or has caused to be made under his/her supervision, a detailed review of the transactions and condition (financial or otherwise) of the Borrower during the accounting period covered by the Borrower Parent’s annual financial statements.

[2].    A review of the activities of the Borrower during such fiscal period has been made under the supervision of the undersigned with a view to determining whether during such fiscal period the Borrower performed and observed all its obligations under the Loan Documents in all material respects, and

[For all reports, select one:]

[to the knowledge of the undersigned, (i) during such fiscal period the Borrower performed and observed each covenant and condition of the Loan Documents applicable to it including without limitation the covenants and conditions specified in Sections 6.13, 7.07 and 7.11 of the Agreement and (ii) no Default has occurred and is continuing.]

--or--

D - 2 - 1

Form of Compliance Certificate (Borrower Parent)

[to the knowledge of the undersigned, during such fiscal period the following covenants or conditions have not been performed or observed and the following is a list of each such Default and its nature and status:]

[For all annual reports or reports the end of each semi-annual fiscal period, select one:]

[2/3]. [The representations and warranties of the Company contained in Article V of the Agreement, and any representations and warranties of the Company that are contained in any document furnished at any time under or in connection with the Loan Documents, (I) to the extent already qualified with respect to “material” matters or “Material Adverse Effect”, are true and correct on and as of the date hereof and (II) to the extent not already qualified with respect to “material” matters or “Material Adverse Effect”, are true and correct on and as of the date hereof in all material respects, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct (in all material respects, as applicable) as of such earlier date, and except that for purposes of this Compliance Certificate, the representations and warranties contained in subsections (a) and (b) of Section 5.05 of the Agreement shall be deemed to refer to the most recent statements furnished pursuant to subsections (a) and (b), respectively, of Section 6.01 of the Agreement, including the statements in connection with which this Compliance Certificate is delivered]

--or—

[The representations and warranties of the Company contained in Article V of the Agreement, and any representations and warranties of the Company that are contained in any document furnished at any time under or in connection with the Loan Documents are not true and correct in the following respects:]

IN WITNESS WHEREOF, the undersigned has executed this Certificate as

of , , in his/her capacity as an officer of Borrower and not in his/her individual capacity.

ACSF FUNDING I, LLC

By: American Capital ACSF Management, LLC, its designated manager

Name:

Title:

D - 2 - 2

Form of Compliance Certificate (Borrower Parent)

EXHIBIT E-1

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Not Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Credit Agreement dated as of December __, 2013 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among ACSF Funding I, LLC (the “Borrower”), and each Lender from time to time party thereto.

Pursuant to the provisions of Section 3.01(e) of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten-percent shareholder of the Borrower Parent within the meaning of Section 871(h)(3)(B) of the Code and (iv) it is not a controlled foreign corporation related to the Borrower Parent as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with a certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments. The undersigned shall furnish the Borrower and the Administrative Agent with any successor version of the IRS Form W-8BEN if and when such form is published.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF LENDER]
By: _______________________
	Name: ________________________
	Title: ________________________

Date: ________ __, 20[ ]

E - 1

Form of U.S. Tax Compliance Certificate

EXHIBIT E-2

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Not Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Credit Agreement dated as of December __, 2013 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among ACSF Funding I, LLC (the “Borrower”), and each Lender from time to time party thereto.

Pursuant to the provisions of Section 3.01(e) of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record and beneficial owner of the participation in respect of which it is providing this certificate, (ii) it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (iii) it is not a ten-percent shareholder of the Borrower Parent within the meaning of Section 871(h)(3)(B) of the Code, and (iv) it is not a controlled foreign corporation related to the Borrower Parent as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with a certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender in writing, and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments. The undersigned shall furnish such Lender with any successor version of the IRS Form W-8BEN if and when such form is published.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF PARTICIPANT]
By: _______________________
	Name: ________________________
	Title: ________________________

Date: ________ __, 20[ ]

E - 2

Form of U.S. Tax Compliance Certificate

EXHIBIT E-3

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Participants That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Credit Agreement dated as of December __, 2013 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among ACSF Funding I, LLC (the “Borrower”), and each Lender from time to time party thereto.

Pursuant to the provisions of Section 3.01(e) of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the participation in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such participation, (iii) with respect such participation, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten-percent shareholder of the Borrower Parent within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower Parent as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished its participating Lender with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform such Lender and (2) the undersigned shall have at all times furnished such Lender with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments. The undersigned shall furnish such Lender with any successor version of the IRS Form W-8IMY and any accompanying IRS Forms W-8IMY and/or W-8BEN if and when such forms are published.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF PARTICIPANT]
By: _______________________
	Name: ________________________
	Title: ________________________

Date: ________ __, 20[ ]

E - 3

Form of U.S. Tax Compliance Certificate

EXHIBIT E-4

FORM OF

U.S. TAX COMPLIANCE CERTIFICATE

(For Foreign Lenders That Are Partnerships For U.S. Federal Income Tax Purposes)

Reference is hereby made to the Credit Agreement dated as of December __, 2013 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among ACSF Funding I, LLC (the “Borrower”), and each Lender from time to time party thereto.

Pursuant to the provisions of Section 3.01(e) of the Credit Agreement, the undersigned hereby certifies that (i) it is the sole record owner of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of which it is providing this certificate, (ii) its direct or indirect partners/members are the sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such Loan(s)), (iii) with respect to the extension of credit pursuant to this Credit Agreement or any other Loan Document, neither the undersigned nor any of its direct or indirect partners/members is a bank extending credit pursuant to a loan agreement entered into in the ordinary course of its trade or business within the meaning of Section 881(c)(3)(A) of the Code, (iv) none of its direct or indirect partners/members is a ten-percent shareholder of the Borrower Parent within the meaning of Section 871(h)(3)(B) of the Code and (v) none of its direct or indirect partners/members is a controlled foreign corporation related to the Borrower Parent as described in Section 881(c)(3)(C) of the Code.

The undersigned has furnished the Administrative Agent and the Borrower with IRS Form W-8IMY accompanied by one of the following forms from each of its partners/members that is claiming the portfolio interest exemption: (i) an IRS Form W-8BEN or (ii) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such partner’s/member’s beneficial owners that is claiming the portfolio interest exemption. By executing this certificate, the undersigned agrees that (1) if the information provided on this certificate changes, the undersigned shall promptly so inform the Borrower and the Administrative Agent, and (2) the undersigned shall have at all times furnished the Borrower and the Administrative Agent with a properly completed and currently effective certificate in either the calendar year in which each payment is to be made to the undersigned, or in either of the two calendar years preceding such payments. The undersigned shall furnish the Administrative Agent and the Borrower with any successor version of the IRS Form W-8IMY and any accompanying IRS Forms W-8IMY and/or W-8BEN if and when such forms are published.

Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

[NAME OF LENDER]
By: _______________________
	Name: ________________________
	Title: ________________________

DATE: ________ __, 20[ ]

E - 3

Form of U.S. Tax Compliance Certificate

EX-2.N.1

Exhibit 2.n.1

Consent of Independent Registered Public Accounting Firm

We consent to the reference to our firm under the captions “Selected Condensed Consolidated Financial Data,” “Senior Securities,” and "Independent Registered Public Accounting Firm" and to the use of our reports dated (i) March 26, 2015, with respect to the consolidated financial statements of American Capital Senior Floating, Ltd. for the year ended December 31, 2014, and for the period October 15, 2013 (commencement of operations) to December 31, 2013, and (ii) July 2, 2015, with respect to the senior securities table as of December 31, 2014 and December 31, 2013, included in the pre-effective amendment No. 2 to the Registration Statement on Form N-2 (No. 333-205463) and related Prospectus of American Capital Senior Floating, Ltd. for the registration of common stock, preferred stock, subscription rights, and debt securities.

/s/ Ernst & Young LLP

McLean, Virginia

November 2, 2015