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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
(Mark One)
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Form 10-K
______________________________________________________________________________________________________
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended September 30, 2023
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
______________________________________________________________________________________________________
Commission file number: 814-00794
GOLUB CAPITAL BDC, INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware
(State or Other Jurisdiction of Incorporation
or Organization)
200 Park Avenue, 25th Floor, New York, NY
(Address of Principal Executive Offices)
27-2326940
(I.R.S. Employer Identification No.)
10166
(Zip Code)
(212) 750-6060
(Registrant’s Telephone Number, Including Area Code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Common Stock, par value $0.001 per share
Trading Symbol
GBDC
Name of each exchange on which registered
The Nasdaq Global Select Market
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐ No ☒
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes ☐ No ☒
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes ☒ No ☐
Auditor Firm ID:
42
Auditor Name:
Ernst & Young LLP
Auditor Location:
Chicago
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large
accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
Non-accelerated filer
Emerging growth company
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Accelerated filer
Smaller reporting company
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial reporting
under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. Yes ☒ No ☐
If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant in the filing reflect the correction of an error to
previously issued financial statements. ☐
Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s
executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).Yes ☐ No ☒
The aggregate market value of common stock held by non-affiliates of the registrant on March 31, 2023 was approximately $2,245 million. For the purposes of calculating this amount
only, all directors and executive officers of the registrant have been treated as affiliates. There were 169,594,742 shares of the registrant’s common stock outstanding as of November
20, 2023.
Portions of the registrant’s proxy statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A in connection with the registrant’s 2024 Annual
Meeting of Stockholders, which will be filed subsequent to the date hereof, are incorporated by reference into Part III of this Form 10-K. Such proxy statement will be filed with the
Securities and Exchange Commission not later than 120 days following the end of the registrant’s fiscal year ended September 30, 2023.
DOCUMENTS INCORPORATED BY REFERENCE
TABLE OF CONTENTS
Part I.
Item 1.
Item 1A.
Item 1B.
Item 1C.
Item 2.
Item 3.
Item 4.
Part II.
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
Item 9C.
Part III.
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Part IV.
Item 15.
Business
Risk Factors
Unresolved Staff Comments
Cybersecurity
Properties
Legal Proceedings
Mine Safety Disclosures
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Reserved
Management’s Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures about Market Risk
Consolidated Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services
Exhibits and Financial Statement Schedules
Signatures
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In this annual report on Form 10-K, except as otherwise indicated, the terms:
PART I
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“we,” “us,” “our” and “Golub Capital BDC” refer to Golub Capital BDC, Inc., a Delaware corporation, and its consolidated subsidiaries;
“Holdings” refers to Golub Capital BDC Holdings LLC, a Delaware limited liability company, or LLC, our direct subsidiary;
“GCIC Holdings” refers to GCIC Holdings LLC, a Delaware LLC, our direct subsidiary;
“2018 Issuer” refers to Golub Capital BDC CLO III LLC, a Delaware LLC, our indirect subsidiary;
“GCIC 2018 Issuer" refers to GCIC CLO II LLC, a Delaware LLC, our indirect subsidiary;
“2020 Issuer” refers to Golub Capital BDC CLO 4 LLC, a Delaware LLC, our indirect subsidiary;
“2018 CLO Depositor” refers to Golub Capital BDC CLO III Depositor LLC, a Delaware LLC, our direct subsidiary;
“GCIC CLO Depositor” refers to GCIC CLO II Depositor LLC, a Delaware LLC, our direct subsidiary;
“2020 CLO Depositor” refers to Golub Capital BDC CLO 4 Depositor LLC, a Delaware LLC, our direct subsidiary;
“Funding II” refers to Golub Capital BDC Funding II LLC, a Delaware LLC, our direct subsidiary;
“Funding Subsidiaries” refers, collectively, to Funding II, prior to its termination on September 16, 2022, GCIC Funding II LLC or GCIC Funding II, a Delaware LLC and our
direct subsidiary, prior to its termination on February 12, 2021, and GCIC Funding LLC, or GCIC Funding, a Delaware LLC and our direct subsidiary, prior to its termination on
October 9, 2020, and each, a “Funding Subsidiary”;
“2024 Notes” refers to the $400.0 million in aggregate principal amount of unsecured notes issued by Golub Capital BDC on October 2, 2020. The 2024 Notes bear interest at a
rate of 3.375% per year payable semiannually in arrears on April 15 and October 15 of each year. The 2024 Notes mature on April 15, 2024. On October 15, 2021, Golub
Capital BDC issued an additional $100.0 million in aggregate principal amount of 2024 Notes, which have the same terms as the original issuance of 2024 Notes;
“2026 Notes” refers to the $400.0 mi llion in aggregate principal amount of unsecured notes issued by Golub Capital BDC on February 24, 2021. The 2026 Notes bear interest
at a rate of 2.500% per year payable semiannually in arrears on February 24 and August 24 of each year. The 2026 Notes mature on August 24, 2026. On October 13, 2021,
Golub Capital BDC issued an additional $200.0 million in aggregate principal amount of 2026 Notes, which have the same terms as the original issuance of 2026 Notes;
“2027 Notes” refers to the $350.0 mi llion in aggregate principal amount of unsecured notes issued by Golub Capital BDC on August 3, 2021. The 2027 Notes bear interest at a
rate of 2.050% per year payable semiannually in arrears on February 15 and August 15 of each year. The 2027 Notes mature on February 15, 2027;
“Unsecured Notes” refers, collectively, to the 2024 Notes, 2026 Notes and 2027 Notes;
“GCIC” refers to Golub Capital Investment Corporation, a Maryland corporation that we acquired on September 16, 2019 pursuant to an agreement and plan of merger by and
among us, GCIC, GC Advisors, and for certain limited purposes our Administrator, or, as amended, the Merger Agreement; prior to such acquisition, which we refer to as the
Merger, GCIC was an externally managed, closed-end, non-diversified management investment company that elected to be regulated as a business development company
under the Investment Company Act of 1940, as amended, or the 1940 Act, and whose investment adviser was GC Advisors. GCIC’s common stock was converted into the right
to receive 0.865 shares of our common stock (with GCIC’s stockholders receiving cash in lieu of fractional shares of our common stock), and we issued an aggregate
71,779,964 shares of our common stock to former stockholders of GCIC;
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“2018 Debt Securitization” refers to the $602.4 million term debt securitization that we completed on November 16, 2018, in which the 2018 Issuer issued an aggregate of
$602.4 million of notes, or the “2018 Notes,” including $327.0 million of Class A 2018 Notes, which bear interest at a rate of three-month Term SOFR, plus 0.26161%, plus
1.48%, $61.2 million of Class B 2018 Notes, which bear interest at a rate of three-month Term SOFR, plus 0.26161%, plus 2.10%, $20.0 million of Class C-1 2018 Notes, which
bear interest at a rate of three-month Term SOFR, plus 0.26161%, plus 2.80%, $38.8 million of Class C-2 2018 Notes, which bear interest at a rate of three-month Term SOFR,
plus 0.26161%, plus 2.65%, $42.0 million of Class D 2018 Notes, which bear interest at a rate of three-month Term SOFR, plus 0.26161%, plus 2.95%, and $113.4 million of
Subordinated 2018 Notes that do not bear interest;
“GCIC 2018 Debt Securitization” refers to the $908.2 million term debt securitization initially completed on December 13, 2018 and that we acquired as part of the Merger in
which the GCIC 2018 Issuer issued an aggregate of $908.2 million of notes, or the "GCIC 2018 Notes", including $490.0 million of AAA/AAA Class A-1 GCIC 2018 Notes, which
bear interest at a rate of three-month Term SOFR, plus 0.26161%, plus 1.48%, $38.5 million of AAA Class A-2 GCIC 2018 Notes, which bore interest at a fixed rate of 4.67%,
$18.0 million of AA Class B-1 GCIC 2018 Notes, which bear interest at a rate of three-month Term SOFR, plus 0.26161%, plus 2.25%, $27.0 million of the Class B-2 GCIC
2018 Notes, which bear interest at a rate of three-month Term SOFR, plus 0.26161%, plus 1.75%, $95.0 million of Class C GCIC 2018 Notes, which bear interest at a rate of
three-month Term SOFR, plus 0.26161%, plus 2.30%, $60.0 million of Class D GCIC 2018 Notes, which bear interest at a rate of three-month Term SOFR, plus 0.26161%,
plus 2.75% and $179.7 million of Subordinated GCIC 2018 Notes that do not bear interest;
“2020 Debt Securitization” refers to the $330.4 million term debt securitization, of which $297.4 million was funded at closing, that we completed on August 26, 2020 and
redeemed on August 26, 2021, in which the 2020 Issuer issued an aggregate of $330.4 million of notes, or the “2020 Notes,” including $137.5 million of AAA Class A-1 2020
Notes, which bore interest at the three-month LIBOR plus 2.35%, $10.5 million of AAA Class A-2 2020 Notes, which bore interest at the three-month LIBOR plus 2.75%, $21.0
million of AA Class B 2020 Notes, which bore interest at the three-month LIBOR plus 3.20%, up to $33.0 million A Class C 2020 Notes, which remained unfunded upon closing
and upon redemption and approximately $108.4 million of Subordinated 2020 Notes, which did not bear interest;
“Debt Securitizations” refers collectively to the 2018 Debt Securitization, the GCIC 2018 Debt Securitization and the 2020 Debt Securitization and each, a “Debt Securitization;”
“WF Credit Facility” refers to the senior secured revolving credit facility that GCIC Funding originally entered into on October 10, 2014 and terminated on February 12, 2021,
with Wells Fargo Securities, LLC as administrative agent, and Wells Fargo Bank, N.A., as lender, that, as of the date of its termination, allowed for borrowing up to $300.0
million, bore interest at a rate of one-month LIBOR plus 2.00% per annum and would have matured on March 21, 2024;
“DB Credit Facility” refers to the senior secured revolving credit facility that GCIC Funding II entered into on December 31, 2018 and terminated on October 9, 2020, with
GCIC, as equity holder and as servicer, Deutsche Bank AG, New York Branch, as facility agent, the other agents parties thereto, each of the entities from time to time party
thereto as securitization subsidiaries and Wells Fargo Bank, National Association, as collateral agent and as collateral custodian, that as of the date of its termination, allowed
for borrowing up to $250.0 million and bore interest at a rate of the applicable base rate, three-month term LIBOR, Canadian Dollar Offered Rate, EURIBOR, or Bank Bill Swap
Rate, as applicable plus 1.90% per annum through the reinvestment period, which would have continued through December 31, 2021;
“JPM Credit Facility” refers to the senior secured revolving credit facility that we initially entered into on February 11, 2021 with JPMorgan Chase Bank, N.A. as administrative
agent and collateral agent, and the bank participants acting as lenders, as amended, that, as of September 30, 2023, permits borrowings of up to $1,488 million in U.S. dollars
and certain agreed upon foreign currencies. As of September 30, 2023, the interest rate on the borrowings under the facility ranged from the applicable benchmark plus 1.75%
to 1.875%, depending on the gross borrowing base, through the maturity date of March 17, 2028. The applicable benchmark rate as of September 30, 2023 for loans
denominated in U.S. dollars is one-month SOFR plus an adjustment of 0.10% and certain other benchmark rates for loans denominated in other foreign currencies;.
“MS Credit Facility II” refers to our senior secured revolving credit facility that Golub Capital BDC Funding II, LLC, a Delaware LLC and our direct subsidiary, entered into on
February 1, 2019 and
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terminated on September 16, 2022, with Morgan Stanley Senior Funding, Inc., as the administrative agent, each of the lenders from time to time party thereto, each of the
securitization subsidiaries from time to time party thereto, and Wells Fargo Bank, N.A., as collateral agent, account bank and collateral custodian, as most recently amended
on July 30, 2021, that allowed for borrowing up to $75.0 million as of the date of its termination, September 16, 2022, and bore interest at the applicable base rate plus 2.45%
per annum through the revolving period, which would have ended April 21, 2024, and that had a stated maturity date of April 12, 2026;
“Revolving Credit Facilities” refers collectively to, prior to its termination on February 12, 2021, the WF Credit Facility; prior to its termination on October 9, 2020, the DB Credit
Facility; the JPM Credit Facility and prior to its termination on September 16, 2022, the MS Credit Facility II, and each a “Revolving Credit Facility”;
“Adviser Revolver” refers to the line of credit with GC Advisors, which allowed for borrowing up to $100.0 million as of September 30, 2023 and bears interest at the short-term
applicable federal rate;
“GC Advisors” refers to GC Advisors LLC, a Delaware LLC, our investment adviser;
“Administrator” refers to Golub Capital LLC, a Delaware LLC, an affiliate of GC Advisors and our administrator;
“Investment Advisory Agreement” refers to the Fourth Amended and Restated Investment Advisory Agreement by and between us and GC Advisors, dated as of August 3,
2023, and effective as of July 1, 2023;
“Prior Investment Advisory Agreement” refers to the Third Amended and Restated Investment Advisory Agreement by and between us and GC Advisors, dated as of
September 16, 2019; and
“Golub Capital” refers, collectively, to the activities and operations of Golub Capital LLC (formerly Golub Capital Management LLC), which entity employs all of Golub Capital’s
investment professionals, GC Advisors and associated investment funds and their respective affiliates.
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Item 1. Business
GENERAL
We are an externally managed, closed-end, non-diversified management investment company that has elected to be regulated as a business development company under the 1940
Act. In addition, for U.S. federal income tax purposes, we have elected to be treated as a regulated investment company, or RIC, under Subchapter M of the Internal Revenue Code of
1986, as amended, or the Code. We were formed in November 2009 to continue and expand the business of our predecessor, Golub Capital Master Funding LLC, which commenced
operations in July 2007. We make investments primarily in one stop loans (a loan that combines characteristics of traditional first lien senior secured loans and second lien or
subordinated loans and that are often referred to by other middle market lenders as unitranche loans) and other senior secured loans of U.S. middle-market companies that are, in most
cases, sponsored by private equity firms. GC Advisors structures these one stop loans as senior secured loans, and we obtain security interests in the assets of the portfolio company
that serve as collateral in support of the repayment of these loans. This collateral often takes the form of first-priority liens on the assets of the portfolio company. In many cases, we are
the sole lender or we, together with our affiliates, are the sole lenders of one stop loans, which can afford us additional influence over the borrower in terms of monitoring and, if
necessary, remediating any underperformance.
In this annual report on Form 10-K, the term “middle-market” generally refers to companies having earnings before interest, taxes, depreciation and amortization, or EBITDA, of less
than $100.0 million annually.
Our investment objective is to generate current income and capital appreciation by investing primarily in senior secured and one stop loans of U.S. middle-market companies. We also
selectively invest in second lien and subordinated (a loan that ranks senior only to a borrower's equity securities and ranks junior to all of such borrower's other indebtedness in priority
of payment) loans of, and warrants and minority equity securities in, middle-market companies. We intend to achieve our investment objective by (1) accessing the established loan
origination channels developed by Golub Capital, a leading lender to middle-market companies that had over $60.0 billion of capital under management as of July 1, 2023, (2) selecting
investments within our core middle-market company focus, (3) partnering with experienced private equity firms, or sponsors, in many cases with whom Golub Capital has invested
alongside in the past, (4) implementing the disciplined underwriting standards of Golub Capital and (5) drawing upon the aggregate experience and resources of Golub Capital.
We seek to create a portfolio that includes primarily senior secured and one stop loans by primarily investing approximately $10.0 million to $80.0 million of capital, on average, in the
securities of middle-market companies. We expect to selectively invest more than $80.0 million in some of our portfolio companies and generally expect that the size of our individual
investments will vary proportionately with the size of our capital base.
We generally invest in securities that have been rated below investment grade by independent rating agencies or that would be rated below investment grade if they were rated. These
securities, which are often referred to as “junk,” have predominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal. In addition, many
of our debt investments have floating interest rates that reset on a periodic basis and typically do not fully pay down principal prior to maturity, which could increase our risk of losing
part or all of our investment.
Information Available
Our address is 200 Park Avenue, 25th Floor, New York, NY 10166. Our phone number is (212) 750-6060, and our internet address is www.golubcapitalbdc.com. We make available,
free of charge, on our website our proxy statement, annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports as
soon as reasonably practicable after we electronically file such material with, or furnish it to, the U.S. Securities and Exchange Commission, or SEC. Information contained on our
website is not incorporated by reference into this annual report on Form 10-K and you should not consider information contained on our website to be part of this annual report on
Form 10-K or any other report we file with the SEC.
The SEC also maintains a website that contains reports, proxy and information statements and other information we file with the SEC at www.sec.gov. Copies of these reports, proxy
and information statements and other information may also be obtained, after paying a duplicating fee, by electronic request at publicinfo@sec.gov.
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Our Adviser
Our investment activities are managed by our investment adviser, GC Advisors. GC Advisors is responsible for sourcing potential investments, conducting research and due diligence
on prospective investments and equity sponsors, analyzing investment opportunities, structuring our investments and monitoring our investments and portfolio companies on an
ongoing basis. GC Advisors was organized in September 2008 and is a registered investment adviser under the Investment Advisers Act of 1940, as amended, or the Advisers Act.
Under our amended and restated investment advisory agreement, or the Investment Advisory Agreement, with GC Advisors, we pay GC Advisors a base management fee and an
incentive fee for its services. See “Business — Management Agreements — Management Fee” for a discussion of the base management fee and incentive fee, including the
cumulative income incentive fee and the income and capital gains incentive fee, payable by us to GC Advisors. Unlike most closed-end funds whose fees are based on assets net of
leverage, our base management fee is based on our average-adjusted gross assets (including leverage but adjusted to exclude cash and cash equivalents so that investors do not pay
the base management fee on such assets) and, therefore, GC Advisors benefits when we incur debt or use leverage. For purposes of the Investment Advisory Agreement, cash
equivalents means U.S. government securities and commercial paper instruments maturing within 270 days of purchase. Additionally, under the incentive fee structure, GC Advisors
benefits when capital gains are recognized and, because it determines when a holding is sold, GC Advisors controls the timing of the recognition of capital gains. Our board of directors
is charged with protecting our interests by monitoring how GC Advisors addresses these and other conflicts of interest associated with its management services and compensation.
While not expected to review or approve each borrowing, our independent directors periodically review GC Advisors’ services and fees as well as its portfolio management decisions
and portfolio performance. In connection with these reviews, our independent directors consider whether our fees and expenses (including those related to leverage) remain
appropriate. See “Business — Management Agreements — Board Approval of the Investment Advisory Agreement.”
GC Advisors is an affiliate of Golub Capital and pursuant to a staffing agreement, or the Staffing Agreement, Golub Capital LLC makes experienced investment professionals available
to GC Advisors and provides access to the senior investment personnel of Golub Capital LLC and its affiliates. The Staffing Agreement provides GC Advisors with access to deal flow
generated by Golub Capital LLC and its affiliates in the ordinary course of their businesses and commits the members of GC Advisors’ investment committee to serve in that capacity.
As our investment adviser, GC Advisors is obligated to allocate investment opportunities among us and its other clients fairly and equitably over time in accordance with its allocation
policy. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Related Party Transactions.” However, there can be no assurance that such
opportunities will be allocated to us fairly or equitably in the short-term or over time. GC Advisors seeks to capitalize on the significant deal origination, credit underwriting, due
diligence, investment structuring, execution, portfolio management and monitoring experience of Golub Capital LLC’s investment professionals.
Our Administrator
Golub Capital LLC, our Administrator and an affiliate of GC Advisors, provides the administrative services necessary for us to operate. See “Business — Management
Agreements — Administration Agreement” for a discussion of the fees and expenses (subject to the review and approval of our independent directors) we are required to reimburse to
the Administrator.
About Golub Capital
Golub Capital, founded in 1994, is a leading lender to middle-market companies, with a long track record of investing in senior secured, one stop, second lien and subordinated loans.
As of July 1, 2023, Golub Capital had over $60.0 billion of capital under management. Since its inception, Golub Capital has closed deals with over 370 middle-market sponsors and
repeat transactions with over 260 sponsors.
Golub Capital’s middle-market lending group is managed by an eight-member senior management team consisting of Lawrence E. Golub, David B. Golub, Andrew H. Steuerman,
Gregory W. Cashman, Spyro G. Alexopoulos, Marc C. Robinson, Robert G. Tuchscherer and Jason J. Van Dussen. As of September 30, 2023, Golub Capital had more than 170
investment professionals supported by more than 650 administrative and back office personnel that focus on operations, finance, legal and compliance, accounting and reporting,
marketing, information technology and office management.
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Market Trends
We have identified the following trends that may affect our business:
Target Market. We believe that small and middle market companies in the United States with annual revenues between $10 million and $2.5 billion represent a significant growth
segment of the U.S. economy and often require substantial capital investments to grow. Middle market companies have generated a significant number of investment opportunities for
investment funds managed or advised by Golub Capital, and we believe that this market segment will continue to produce significant investment opportunities for us. We continue to
focus our portfolio on borrowers in what we believe are recession resistant industries that are insulated from the effects of economic disruptions, such as the COVID-19 pandemic.
Specialized Lending Requirements. We believe that several factors render many U.S. financial institutions ill-suited to lend to U.S. middle market companies. For example, based on
the experience of our management team, lending to U.S. middle market companies (1) is generally more labor intensive than lending to larger companies due to the smaller size of each
investment and the fragmented nature of information for such companies, (2) requires due diligence and underwriting practices consistent with the demands and economic limitations of
the middle market and (3) also requires more extensive ongoing monitoring by the lender.
Demand for Debt Capital. We believe there is a large pool of committed but uninvested private equity capital for middle market companies. We expect private equity firms will seek to
leverage their investments by combining equity capital with senior secured loans and subordinated debt from other sources, such as us.
Competition from Bank Lenders. We believe that many traditional bank lenders to middle market businesses have either exited or de-emphasized their service and product offerings in
the middle market. These traditional lenders have instead focused on lending and providing other services to large corporate clients. We believe this has resulted in fewer key players
and the reduced availability of debt capital to the companies we target.
Market Environment: We believe middle market investments are likely to excel in uncertain market environments and that these investments have historically generated premium
yields with more desirable structures for lenders as compared to large corporate loans.
shift toward well-positioned larger platforms. On the other hand, we believe that there has been increased competition for direct lending to middle market businesses, which would be
expected to result in less favorable pricing terms for our potential investments. If we match our competitors’ pricing, terms and structure, we would expect to experience decreased net
interest income, lower yields and increased risk of credit loss. However, we believe that Golub Capital’s scale, product suite, entrenched relationships and strong market position will
continue to allow us to find investment opportunities with attractive risk-adjusted returns.
In addition, we believe the recent credit market dislocation will accelerate the market share
(1)
Standard & Poor’s “High-End Middle-Market Lending Review Q4 2021” – New-issue first-lien yield-to-maturity. Middle-Market loans have, on average, generated higher yields in
(1)
comparison to large corporate loans based on data starting in June 2005.
Competitive Strengths
Deep, Experienced Management Team . We are managed by GC Advisors, which has access through the Staffing Agreement to the resources and expertise of Golub Capital’s more
than 850 employees, led by our chairman, Lawrence E. Golub, and our chief executive officer, David B. Golub. As of September 30, 2023, Golub Capital’s more than 170 investment
professionals had an average of approximately 13 years of investment experience and were supported by more than 650 administrative and back office personnel that focus on
operations, finance, legal and compliance, accounting and reporting, marketing, information technology and office management. GC Advisors also manages (i) Golub Capital BDC 3,
Inc., a Maryland corporation, or GBDC 3; (ii) Golub Capital Direct Lending Corporation, a Maryland corporation, or GDLC; (iii) Golub Capital BDC 4, Inc., a Maryland corporation, or
GBDC4; (iv) Golub Capital Direct Lending Unlevered Corporation, a Maryland corporation, or GDLCU; and (v) Golub Capital Private Credit Fund, a Delaware statutory trust, or GCRED,
each of which has elected to be regulated as a business development company, have investment mandates similar to ours, and primarily focus on investing in one stop and other
senior secured loans. Golub Capital seeks to hire and retain high-quality investment professionals and reward those personnel based on investor returns.
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Leading U.S. Debt Platform Provides Access to Proprietary Relationship-Based Deal Flow . GC Advisors gives us access to the deal flow of Golub Capital, one of the leading middle-
market lenders in the United States. Golub Capital has been a top 3 Traditional Middle Market Bookrunner each year from 2008 through Q1 2023 for senior secured loans of up to
$500.0 million for leveraged buyouts based on number of deals completed according to Thomson Reuters LPC and internal data. We believe this market position makes Golub Capital
the first choice lender to many sponsors. Since its inception, Golub Capital has closed deals with over 370 middle-market sponsors and repeat transactions with over 260 sponsors. We
believe that Golub Capital receives relationship-based “early looks” and “last looks” at many investment opportunities in the U.S. middle-market market, allowing it to be highly selective
in the transactions it pursues.
Disciplined Investment and Underwriting Process . GC Advisors utilizes the established investment process of Golub Capital for reviewing lending opportunities, structuring transactions
and monitoring investments. Using its disciplined approach to lending, GC Advisors seeks to minimize credit losses through effective underwriting, comprehensive due diligence
investigations, structuring and the implementation of restrictive debt covenants. We expect that GC Advisors will continue to select borrowers whose businesses will retain significant
value, even in a depressed market or a distressed sale. GC Advisors intends to reduce risk further by focusing on repeat transactions with proven, successful sponsors. While
emphasizing thorough credit analysis, GC Advisors intends to maintain strong relationships with sponsors by offering rapid initial feedback from senior investment professionals on each
investment opportunity.
Regimented Credit Monitoring . Following each investment, GC Advisors implements a regimented credit monitoring system. This careful approach, which involves ongoing review and
analysis by teams of professionals, has enabled GC Advisors to identify problems early and to assist borrowers before they face difficult liquidity constraints. If necessary, GC Advisors
can assume the role of deal sponsor in a work-out situation and has extensive restructuring experience, both in and out of bankruptcy. GC Advisors believes in the need to prepare for
possible negative contingencies in order to address them promptly should they arise.
Concentrated Middle-Market Focus. Because of our focus on the middle-market, we understand the following general characteristics of middle-market lending:
• middle-market companies are generally less leveraged than large companies and, we believe, offer more attractive investment returns in the form of upfront fees, prepayment
penalties and higher interest rates;
• middle-market issuers are more likely to have simple capital structures;
•
carefully structured covenant packages enable middle-market lenders to take early action to remediate poor financial performance; and
• middle-market lenders can undertake thorough due diligence investigations prior to investment.
Investment Criteria/Guidelines
Our investment objective is to generate current income and capital appreciation by investing primarily in senior secured and one stop loans to U.S. middle market companies in
industries we believe are resistant to recessions. We seek to generate strong risk-adjusted net returns by assembling a portfolio of investments across a broad range of industries and
private equity investors.
We primarily target U.S. middle-market companies controlled by private equity investors that require capital for growth, acquisitions, recapitalizations, refinancings and leveraged
buyouts. We seek to have a portfolio of first-lien, senior secured loans to borrowers focused on a number of sectors and industries that we believe have shown resilience during
economic disruptions and are likely to show resilience in future recessionary periods, including, for example, software and technology companies as well as business, financial and
healthcare services among others. We also make opportunistic loans to independently owned and publicly held middle market companies. We seek to partner with strong management
teams executing long-term growth strategies. Target businesses will typically exhibit some or all of the following characteristics:
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•
•
•
•
•
•
•
•
•
•
•
•
•
annual EBITDA of less than $100.0 million;
sustainable leading positions in their respective markets;
scalable revenues and operating cash flow;
experienced management teams with successful track records;
insulation from the effects of economic disruptions, such as the COVID-19 pandemic;
stable, predictable cash flows with low technology and market risks;
a substantial equity cushion in the form of capital ranking junior to our investment provided by a middle market private equity sponsor;
low capital expenditures requirements;
a North American base of operations;
strong customer relationships;
products, services or distribution channels having distinctive competitive advantages;
defensible niche strategy or other barriers to entry; and
demonstrated growth strategies.
While we believe that the criteria listed above are important in identifying and investing in prospective portfolio companies, not all of these criteria will be met by each prospective
portfolio company.
Investment Process Overview
We view our investment process as consisting of four distinct phases described below:
Origination. GC Advisors sources investment opportunities through access to a network of over 10,000 individual contacts developed in the financial services and related industries by
Golub Capital and managed through a proprietary customer relationship database. Among these contacts is an extensive network of private equity firms and relationships with leading
middle-market senior lenders. The senior deal professionals of Golub Capital supplement these leads through personal visits and marketing campaigns. It is their responsibility to
identify specific opportunities, to refine opportunities through candid exploration of the underlying facts and circumstances and to apply creative and flexible thinking to solve clients’
financing needs. The investment professionals of Golub Capital have a long and successful track record investing in companies across many industry sectors. Collectively, these
investment professionals have closed investments in over 2,300 loans at Golub Capital. Golub Capital’s investments have been made in the following industries, among others:
healthcare, restaurant and retail, software, digital and technology services, specialty manufacturing, business services, consumer products and services, food and beverages,
aerospace and defense and value-added distribution.
Golub Capital has principal lending offices in Chicago, New York, London and San Francisco. Each of Golub Capital's originators maintains long-standing customer relationships and is
responsible for covering a specified target market. We believe those originators’ strength and breadth of relationships across a wide range of markets generate numerous financing
opportunities, which we believe enables GC Advisors to be highly selective in recommending investments to us.
Underwriting. We utilize the systematic, consistent approach to underwriting developed by Golub Capital, with a particular focus on determining the value of a business in a downside
scenario. The key criteria that we consider include (1) strong and resilient underlying business fundamentals, (2) a substantial equity cushion in the form of capital ranking junior in right
of payment to our investment and (3) a conclusion that overall “downside” risk is manageable. While the size of this equity cushion will vary over time and across industries, the equity
cushion generally sought by GC Advisors today is between 35% and 45% of total portfolio capitalization. We generally focus on the criteria developed by Golub Capital for evaluating
prospective portfolio companies, which uses a combination of analyses, including (1) fundamental analysis of a business’s financial statements, health, management, competitive
advantages, competitors and markets; (2) analysis of opportunities in a given market based upon fluctuations due to seasonal, financial and economic factors; (3) quantitative analysis
of the relative risk-return characteristics of investments and a comparison of yields between asset classes and other indicators; and (4) analysis of proprietary and secondary models.
In evaluating a particular company, we put more emphasis on credit considerations (such as (1) loan-to-value ratio (which is the amount of our loan divided by the enterprise value of
the
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company in which we are investing), (2) the ability of the company to maintain a liquidity cushion through economic cycles and in downside scenarios, (3) the ability of the company to
service its fixed charge obligations under a variety of scenarios and (4) its anticipated strategic value in a downturn) than on profit potential and loan pricing. Based upon a combination
of bottom-up analysis of the individual investment and GC Advisors’ expectations of future market conditions, GC Advisors seeks to assess the relative risk and reward for each
investment. GC Advisors seeks to mitigate the risks of a single company or single industry through portfolio diversification. GC Advisors also considers environmental, social and
governance considerations in the investment decision-making process, in accordance with its ESG policy, including analysis of the likelihood of material ESG-related risk based on the
industry and industry subsector of the potential portfolio company, with further diligence and analysis based on this categorization as well as other factors identified during diligence.
ESG related risks can include, among others, issues related to environmental impact and climate change, anti-discrimination and anti-harassment, data privacy and security, social and
labor conditions and ethics and compliance. Although GC Advisors typically avoids investing in portfolio companies in industries that tend to raise ESG related risks, GC Advisors would
not necessarily pass on such investment opportunities solely for ESG reasons. Golub Capital’s due diligence process for middle market credits will typically entail:
•
•
•
•
•
•
•
a thorough review of historical and pro forma financial information;
on-site visits;
interviews with management and employees;
a review of loan documents and material contracts;
third-party “quality of earnings” accounting due diligence;
when appropriate, background checks on key managers and research relating to the company’s business, industry, markets, customers, suppliers, products and services and
competitors; and
the commission of third-party market studies when appropriate.
The following chart illustrates the stages of Golub Capital’s evaluation and underwriting process:
ILLUSTRATIVE DEAL EVALUATION PROCESS
Execution. In executing transactions for us, GC Advisors utilizes the due diligence process developed by Golub Capital. Through a consistent approach to underwriting and careful
attention to the details of execution, Golub Capital seeks to maintain discipline with respect to credit, pricing, and structure to ensure the ultimate success of the financing. Upon
completion of due diligence, the investment team working on an investment delivers a final memorandum to GC Advisors’ investment committee. Once an investment has been
approved by the investment committee, it moves through a series of steps generally, including initial documentation using standard document templates, final documentation, including
resolution of business points and the execution of original documents held in escrow. Upon completion of final documentation, a loan is funded upon the execution of an investment
committee memorandum by members of GC Advisors’ investment committee.
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Monitoring. We view active portfolio monitoring as a vital part of our investment process. We consider board observation rights, where appropriate, regular dialogue with company
management and sponsors and detailed, internally generated monitoring reports to be critical to our performance. Golub Capital has developed a monitoring template that is designed
to reasonably ensure compliance with these standards. This template is used by GC Advisors as a tool to assess investment performance relative to our plan. In addition, our portfolio
companies often rely on GC Advisors to provide them with financial and capital markets expertise.
As part of the monitoring process, GC Advisors regularly assesses the risk profile of each of our investments and rates each of them based on an internal system developed by Golub
Capital and its affiliates. This system is not generally accepted in our industry or used by our competitors. It is based on the following categories, which we refer to as GC Advisors’
internal performance ratings:
Internal Performance Ratings
Rating
5
4
3
2
1
Definition
Involves the least amount of risk in our portfolio. The borrower is performing above expectations, and the trends and risk factors are generally favorable.
Involves an acceptable level of risk that is similar to the risk at the time of origination. The borrower is generally performing as expected, and the risk factors are
neutral to favorable.
Involves a borrower performing below expectations and indicates that the loan’s risk has increased somewhat since origination. The borrower could be out of
compliance with debt covenants; however, loan payments are generally not past due.
Involves a borrower performing materially below expectations and indicates that the loan’s risk has increased materially since origination. In addition to the
borrower being generally out of compliance with debt covenants, loan payments could be past due (but generally not more than 180 days past due).
Involves a borrower performing substantially below expectations and indicates that the loan’s risk has substantially increased since origination. Most or all of the
debt covenants are out of compliance and payments are substantially delinquent. Loans rated 1 are not anticipated to be repaid in full and we will reduce the fair
market value of the loan to the amount we anticipate will be recovered.
Our internal performance ratings do not constitute any rating of investments by a nationally recognized statistical rating organization or represent or reflect any third-
party assessment of any of our investments.
For any investment rated 1, 2 or 3, GC Advisors increases its monitoring intensity and prepares regular updates for the investment committee, summarizing current operating results
and material impending events and suggesting recommended actions.
GC Advisors monitors and, when appropriate, changes the internal performance ratings assigned to each investment in our portfolio. In connection with our valuation process, GC
Advisors and our board of directors review these internal performance ratings on a quarterly basis.
The following table shows the distribution of our investments on the 1 to 5 internal performance rating scale at fair value as of September 30, 2023 and 2022:
Internal
Performance
Rating
5
4
3
2
1
Total
Investment Committee
September 30, 2023
September 30, 2022
Investments
at Fair Value
(In thousands)
Percentage of
Total
Investments
Investments
at Fair Value
(In thousands)
Percentage of
Total
Investments
$
$
50,279
4,647,644
803,724
14,966
—
5,516,613
0.9
84.2
14.6
0.3
—
100.0
$
$
252,572
4,725,988
398,625
69,171
—
5,446,356
4.6
86.8
7.3
1.3
—
100.0
The purpose of GC Advisors’ investment committee, which is comprised of officers of GC Advisors, is to evaluate and approve all of our investments, subject to the oversight of our
board of directors. The investment committee process is intended to bring the diverse experience and perspectives of the committee’s members to the analysis and
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consideration of each investment. The investment committee currently consists of Lawrence E. Golub, David B. Golub, Andrew H. Steuerman, Gregory W. Cashman, Spyro G.
Alexopoulos, Marc C. Robinson, Robert G. Tuchscherer and Jason J. Van Dussen. The investment committee serves to provide investment consistency and adherence to our core
investment philosophy and policies. The investment committee also determines appropriate investment sizing and suggests ongoing monitoring requirements.
In addition to reviewing investments, investment committee meetings serve as a forum to discuss credit views and outlooks. Potential transactions and deal flow are reviewed on a
regular basis. Members of the investment team are encouraged to share information and credit views with the investment committee early in their analysis. We believe this process
improves the quality of the analysis and assists the deal team members to work more efficiently.
Each transaction is presented to the investment committee in a formal written report. Each investment opportunity generally receives the unanimous approval of the investment
committee. Each member of the investment committee performs a similar role for other investment funds, accounts or other investment vehicles, collectively referred to as accounts,
sponsored or managed by Golub Capital and its affiliates.
Investment Structure
Once GC Advisors determines that a prospective portfolio company is suitable for investment, GC Advisors typically works with the private equity sponsor, if applicable, the
management of that company and its other capital providers to structure our investment. GC Advisors negotiates with these parties to agree on how our investment should be structured
relative to other capital in the portfolio company’s capital structure.
GC Advisors structures our investments, which typically have maturities of three to seven years, as follows:
Senior Secured Loans. GC Advisors structures investments in senior secured loans, where we obtain security interests in the assets of the portfolio company that serve as collateral in
support of the repayment of such loans. This collateral often takes the form of first-priority liens on the assets of the portfolio company. Our senior secured loans often provide for
moderate loan amortization in the early years of the loan, with the majority of the amortization deferred until loan maturity. Our senior secured loans may include a payment in kind, or
PIK, feature.
One Stop Loans. GC Advisors structures our one stop loans as senior secured loans. A one stop loan is a single loan that blends the characteristics of traditional senior debt and
traditional junior debt. The structure generally combines the stronger lender protections associated with first lien senior secured debt with the superior economics of junior capital. We
obtain security interests in the assets of the portfolio company that serve as collateral in support of the repayment of these loans. This collateral often takes the form of first-priority liens
on the assets of the portfolio company. In some cases, one stop loans are provided to borrowers experiencing high revenue growth supported by a high level of discretionary
expenditures. As part of the underwriting of such loans and consistent with industry practice, we adjust our characterization of the earnings of such borrowers for a reduction or
elimination of such discretionary expenses if appropriate. One stop loans typically provide for moderate loan amortization in the initial years of the facility, with the majority of the
amortization deferred until loan maturity. Our one stop loans may include a PIK feature. One stop loans generally allow the borrower to make a large lump sum payment of principal at
the end of the loan term and there is a risk of loss if the borrower is unable to pay the lump sum or refinance the amount owed at maturity. In many cases, we are the sole lender or we,
together with our affiliates, are the sole lenders of a one stop loan, which can afford us additional influence over the borrower in terms of monitoring and, if necessary, remediating any
underperformance.
One stop loans include loans to technology companies undergoing strong growth due to new services, increased adoption and/or entry into new markets. We refer to loans to these
companies as recurring revenue loans. Other targeted characteristics of recurring revenue businesses include strong customer revenue retention rates, a diversified customer base
and backing from growth equity or venture capital firms. In some cases, the borrower’s high revenue growth is supported by a high level of discretionary spending. As part of the
underwriting of such loans and consistent with industry practice, we adjust our characterization of the earnings of such borrowers for a reduction or elimination of such discretionary
expenses, if appropriate.
Second Lien Loans. GC Advisors structures these investments as subordinated, secured loans for which our claims on the related collateral are subordinated. We obtain security
interests in the assets of the portfolio company that serve as collateral in support of the repayment of such loans. This collateral typically takes the form of second priority liens on the
assets of a portfolio company. Second lien loans typically provide for minimal loan amortization in the initial years of the facility, with the majority of the amortization deferred until loan
maturity.
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Subordinated Loans. GC Advisors structures these investments as unsecured, subordinated loans that provide for relatively high, fixed interest rates and provide us with significant
current interest income. These loans typically have interest-only payments (often representing a combination of cash pay and PIK interest) in the early years, with all or the majority of
amortization of principal deferred until loan maturity. Subordinated loans generally allow the borrower to make a large lump sum payment of principal at the end of the loan term, and
there is a risk of loss if the borrower is unable to pay the lump sum or refinance the amount owed at maturity.
Second lien loans and subordinated loans are generally more volatile than first lien, senior secured loans and involve a greater risk of loss of principal. In addition, the PIK feature of
many subordinated loans, which effectively operates as negative amortization of loan principal, increases credit risk exposure over the life of the loan. Subordinated loans are more
likely to include a PIK feature.
Equity Investments. GC Advisors structures these investments as direct or indirect minority equity co-investments in a portfolio company, usually on terms similar to the controlling
private equity sponsor and in connection with our loan to such portfolio company. As a result, if a portfolio company appreciates in value, we can achieve additional investment return
from these equity co-investments. GC Advisors can structure these equity co-investments to include provisions protecting our rights as a minority-interest holder, which could include a
“put,” or right to sell such securities back to the issuer, upon the occurrence of specified events or demand and “piggyback” registration rights. However, because these equity co-
investments will typically be in private companies, there is no guarantee that we, as a minority-interest holder, will control the timing or value of our realization of any gains on such
investments.
Our equity co-investments will typically include customary “tag-along” and/or “drag-along” rights that will permit or require us to participate in a sale of such equity co-investments at
such time as the majority owners, not GC Advisors, determine.
GC Advisors tailors the terms of each investment to the facts and circumstances of the transaction and the prospective portfolio company, negotiating a structure that protects our rights
and manages our risk while creating incentives for the portfolio company to achieve its business plan and improve its operating results. GC Advisors seeks to limit the downside
potential of our investments by:
•
•
•
selecting investments that we believe have a very low probability of loss;
requiring a total return on our investments that we believe will compensate us appropriately for credit risk; and
negotiating covenants in connection with our investments that afford our portfolio companies as much flexibility in managing their businesses as possible, consistent with the
preservation of our capital. Such restrictions could include affirmative and negative covenants, default penalties, lien protection, change of control provisions and board rights.
We expect to hold most of our investments to maturity or repayment, but we may sell some of our investments earlier if a liquidity event occurs, such as a sale, recapitalization or
worsening of the credit quality of the portfolio company.
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Investments
We seek to create a portfolio that includes primarily one stop and other senior secured loans by investing approximately $10.0 million to $80.0 million of capital, on average, in the
securities of middle-market companies. We also selectively invest more than $80.0 million in some of our portfolio companies and generally expect that the size of our individual
investments will vary proportionately with the size of our capital base. Set forth below is a list of our ten largest portfolio company investments as of September 30, 2023, as well as the
top ten industries in which we were invested as of September 30, 2023, calculated as a percentage of our total investments at fair value as of such date.
Portfolio Company
GS Acquisitionco, Inc.
Diligent Corporation
Imperial Optical Midco Inc.
Inhabit IQ Inc. (PB VB Holdco IV INC)
Bullhorn, Inc.
TWAS Holdings, LLC
Bayshore Intermediate #2, L.P.
GTIV, LLC
Datix Bidco Limited
Revalize, Inc. (fka AQ Holdco)
Industry
Software
Healthcare Providers and Services
Specialty Retail
Diversified Consumer Services
Automobiles
IT Services
Insurance
Health Care Technology
Pharmaceuticals
Commercial Services and Supplies
Managerial Assistance
Investments at
Fair Value
(In thousands)
Percentage of
Total
Investments
$
$
$
$
114,036
111,911
84,817
82,117
80,908
78,351
77,451
73,471
72,928
70,228
846,218
Investments at
Fair Value
(In thousands)
1,455,863
451,795
308,126
271,351
270,598
260,877
246,424
222,984
162,335
159,232
3,809,585
2.1 %
2.0
1.5
1.5
1.5
1.4
1.4
1.3
1.3
1.3
15.3 %
Percentage of
Total Investments
26.4 %
8.2
5.6
4.9
4.9
4.7
4.5
4.1
2.9
2.9
69.1 %
As a business development company, we offer, and must provide upon request, managerial assistance to our portfolio companies. This assistance could involve monitoring the
operations of our portfolio companies, participating in board and management meetings, consulting with and advising officers of portfolio companies and providing other organizational
and financial guidance. The Administrator or an affiliate of the Administrator provides such managerial assistance on our behalf to portfolio companies that request this assistance. We
could receive fees for these services and reimburse the Administrator or an affiliate of the Administrator, as applicable, for its allocated costs in providing such assistance, subject to
the review and approval by our board of directors, including our independent directors.
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Competition
Our primary competitors in providing financing to middle-market companies include public and private funds, other business development companies, commercial and investment
banks, commercial financing companies and, to the extent they provide an alternative form of financing, private equity and hedge funds. Many of our competitors are substantially larger
and have considerably greater financial, technical and marketing resources than we do. For example, we believe some competitors have access to funding sources that are not
available to us. In addition, some of our competitors have higher risk tolerances or different risk assessments, which could allow them to consider a wider variety of investments and
establish more relationships than us. Furthermore, many of our competitors are not subject to the regulatory restrictions that the 1940 Act imposes on us as a business development
company or to the source-of-income, asset diversification and distribution requirements we must satisfy to maintain our qualification as a RIC.
We use the expertise of the investment professionals of Golub Capital and its affiliates to which we have access to assess investment risks and determine appropriate pricing for our
investments in portfolio companies. In addition, the relationships of the senior members of Golub Capital and its affiliates enable us to learn about, and compete effectively for, financing
opportunities with attractive middle-market companies in the industries in which we invest. See “Risk Factors — Risks Relating to our Business and Structure — We operate in a highly
competitive market for investment opportunities, which could reduce returns and result in losses.”
Administration
We do not have any direct employees, and our day-to-day investment operations are managed by GC Advisors. Our business and affairs are managed under the direction of our board
of directors. We have a chief executive officer, chief financial officer, chief compliance officer, managing director and director of corporate strategy, and to the extent necessary, our
board of directors can elect to appoint additional officers going forward. Our officers are officers and/or employees of Golub Capital LLC, an affiliate of GC Advisors, and our allocable
portion of the cost of our chief financial officer and chief compliance officer and their respective staffs is paid by us pursuant to the administration agreement, or the Administration
Agreement, with the Administrator. See “Business - Management Agreements - Administration Agreement.”
SUMMARY RISK FACTORS
The risk factors described below are a summary of the principal risk factors associated with an investment in us. These are not the only risks we face. You should carefully consider
these risk factors, together with the risk factors set forth in Item 1A. of this Annual Report on Form 10-K and the other reports and documents filed by us with the SEC.
We are subject to risks relating to our business and structure
• We are subject to risks associated with the current interest rate environment and to the extent we use debt to finance our investments, changes in interest rates will affect our
cost of capital and net investment income.
Rising interest rates could affect the value of our investments and could make it more difficult for portfolio companies to make periodic payments on their loans.
• We operate in a highly competitive market for investment opportunities, which could reduce returns and result in losses.
•
• We are subject to risks associated with the transition away from LIBOR, which will affect our cost of capital and net investment income.
• We are dependent upon GC Advisors for our success and upon its access to the investment professionals and partners of Golub Capital and its affiliates.
• Our business model depends to a significant extent upon strong referral relationships with sponsors and
investing in companies backed by private equity sponsors. Any inability of GC Advisors to maintain or
develop these relationships, or the failure of these relationships to generate investment opportunities, could
adversely affect our business.
There are significant potential conflicts of interest as a result of our arrangements with GC Advisors and its affiliates and GC Advisors’ investment committee that could affect
our investment returns.
•
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• GC Advisors could make certain investment decisions for the purpose of receiving transaction fees.
• GC Advisors could prioritize its relationship with a borrower or private equity sponsor instead of seeking
the most advantageous terms for our investments.
• GC Advisors operates in multiple business lines and could pursue additional business lines, which could
create a conflict of interest in the allocation of its time and focus.
• Golub Capital could pursue strategic transactions, which could create a conflict of interest in the allocation
of GC Advisors’ time and focus.
• We and GC Advisors could be the target of litigation or regulatory investigations.
• We are subject to certain risks related to our ability to qualify as a RIC and to related to regulations governing our operation as a business development company.
• We finance our investments with borrowed money, which will accelerate and increase the potential for gain or loss on amounts invested and could increase the risk of investing
in us.
• We are subject to risks associated with the Unsecured Notes, the Debt Securitizations and the Revolving Credit Facilities.
•
The majority of our portfolio investments are recorded at fair value as determined in good faith by our board of directors and, as a result, there could be uncertainty as to the
value of our portfolio investments.
• Our board of directors could change our investment objective, operating policies and strategies without prior notice or stockholder approval.
•
Each of GC Advisors and the Administrator can resign on 60 days’ notice, and we can provide no assurance that we could 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.
We are subject to risks relating to our investments
Economic recessions or downturns could impair our portfolio companies and defaults by our portfolio companies will harm our operating results.
Inflation could adversely affect the business, result of operations and financial condition of our portfolio companies.
•
•
• Our investments in debt, leveraged portfolio companies, and private and middle-market portfolio companies are risky and we could lose all or part of our investment.
•
•
The lack of liquidity in our investments could adversely affect our business.
Price declines and illiquidity in the corporate debt markets could adversely affect the fair value of our portfolio investments, reducing our net asset value through increased net
unrealized depreciation.
• Our portfolio companies could prepay loans, which could reduce our yields if capital returned cannot be invested in transactions with equal or greater expected yields.
• We are subject to credit and default risk and our portfolio companies could be unable to repay or refinance outstanding principal on their loans at or prior to maturity.
• Our portfolio could be concentrated in a limited number of portfolio companies and industries, which will subject us to a risk of significant loss if any of these companies
defaults on its obligations under any of its debt instruments or if there is a downturn in a particular industry.
• We could hold the debt securities of leveraged companies that could, due to the significant volatility of such companies, enter into bankruptcy proceedings.
• Our failure to make follow-on investments in our portfolio companies could impair the value of our portfolio.
•
Because we generally do not hold controlling equity interests in our portfolio companies, we generally will not be able to exercise control over our portfolio companies or to
prevent decisions by management of our portfolio companies that could decrease the value of our investments.
• Our portfolio companies could incur debt that ranks equally with, or senior to, our investments in such companies and such portfolio companies could fail to generate sufficient
cash flow to service their debt obligations to us.
The disposition of our investments could result in contingent liabilities.
•
• GC Advisors’ liability is limited, and we have agreed to indemnify GC Advisors against certain liabilities, which could lead GC Advisors to act in a riskier manner on our behalf
than it would when acting for its own account.
• We could be subject to risks if we engage in hedging transactions and could become subject to risks if we invest in foreign securities.
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• We could suffer losses from our equity investments.
• We could be subject to lender liability claims with respect to our portfolio company investments.
Investors are subject to risks relating to an investment in our securities
•
•
•
•
Investing in our securities could involve an above average degree of risk and the market price of our securities could fluctuate significantly.
Shares of closed-end investment companies, including business development companies, often trade at a discount to their net asset value.
There is a risk that investors in our equity securities will not receive distributions or that our distributions will not grow over time and a portion of our distributions could be a
return of capital.
The Unsecured Notes are unsecured and therefore are effectively subordinated to any secured indebtedness and are structurally subordinated to the indebtedness and other
liabilities of our subsidiaries.
If we default on our obligations to pay our other indebtedness, we may not be able to make payments on the Unsecured Notes.
•
• Our stock repurchase program could affect the price of our common stock and increase volatility and may be suspended or terminated at any time, which may result in a
decrease in the trading price of our common stock.
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MANAGEMENT AGREEMENTS
GC Advisors is located at 200 Park Avenue, 25th Floor, New York, NY 10166. GC Advisors is registered as an investment adviser under the Advisers Act. The beneficial interests in GC
Advisors are majority owned, indirectly, by two affiliated trusts. The trustees of those trusts are Stephen A. Kepniss and David L. Finegold. Subject to the overall supervision of our
board of directors and in accordance with the 1940 Act, GC Advisors manages our day-to-day operations and provides investment advisory services to us. Under the terms of the
Investment Advisory Agreement, GC Advisors:
•
•
•
•
•
•
determines the composition of our portfolio, the nature and timing of the changes to our portfolio and the manner of implementing such changes;
identifies, evaluates and negotiates the structure of the investments we make;
executes, closes, services and monitors the investments we make;
determines the securities and other assets that we purchase, retain or sell;
performs due diligence on prospective portfolio companies; and
provides us with such other investment advisory, research and related services as we, from time to time, reasonably require for the investment of our funds.
GC Advisors’ services under the Investment Advisory Agreement are not exclusive. Subject to the requirements of the 1940 Act, GC Advisors can enter into one or more sub-advisory
agreements under which GC Advisors would obtain assistance in fulfilling its responsibilities under the Investment Advisory Agreement.
Management Fee
Pursuant to the Investment Advisory Agreement, we pay GC Advisors a fee for investment advisory and management services consisting of two components — a base management
fee and an incentive fee. The cost of both the base management fee and the incentive fee is ultimately borne by our stockholders.
On August 3, 2023, our board of directors approved, and we entered into, the Investment Advisory Agreement with the Investment Adviser, effective as of July 1, 2023, pursuant to
which the base management fee rate is reduced from 1.375% to 1.0%.
Under the Investment Advisory Agreement, the base management fee is calculated at an annual rate equal to 1.0% of our average adjusted gross assets at the end of the two most
recently completed calendar quarters (excluding cash and cash equivalents but including assets purchased with borrowed funds and securitization-related assets and cash collateral on
deposit with custodian). Under the Prior Investment Advisory Agreement, the base management fee was calculated at an annual rate equal to 1.375% of our average adjusted gross
assets at the end of the two most recently completed calendar quarters (excluding cash and cash equivalents but including assets purchased with borrowed funds and securitization-
related assets and cash collateral on deposit with custodian). Additionally, GC Advisors is voluntarily excluding assets funded with secured borrowing proceeds from the management
fee. For services rendered under each of the Investment Advisory Agreement and Prior Investment Advisory Agreement, the base management fee is payable quarterly in arrears. The
base management fee is calculated based on the average value of our gross assets at the end of the two most recently completed calendar quarters, and appropriately adjusted for
any share issuances or repurchases during a current calendar quarter. Base management fees for any partial month or quarter are appropriately pro-rated. For purposes of the
Investment Advisory Agreement, cash equivalents means U.S. government securities and commercial paper instruments maturing within 270 days of purchase. To the extent that GC
Advisors or any of its affiliates provides investment advisory, collateral management or other similar services to a subsidiary of ours, the base management fee shall be reduced by an
amount equal to the product of (1) the total fees paid to GC Advisors by such subsidiary for such services and (2) the percentage of such subsidiary’s total equity, including membership
interests and any class of notes not exclusively held by one or more third parties, that is owned, directly or indirectly, by us.
Incentive Fee
We pay GC Advisors an incentive fee. Incentive fees are calculated as described below and payable quarterly in arrears or at the end of each calendar year (or, upon termination of the
Investment Advisory Agreement, as of the termination date).
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Cap on Fees. We have structured the calculation of the incentive fee to include a fee limitation such that, under each of the Investment Advisory Agreement and Prior Investment
Advisory Agreement, an incentive fee for any quarter can only be paid to GC Advisors if, after such payment, the cumulative incentive fees paid to GC Advisors, calculated on a per
share basis as described below, since April 13, 2010, the effective date of our election to become a business development company, would be less than or equal to 20.0% of our
Cumulative Pre-Incentive Fee Net Income (as defined below).
We accomplish this limitation by subjecting each quarterly incentive fee payable under the Income and Capital Gains Incentive Fee Calculation (as defined below) to a cap, or the
Incentive Fee Cap. The Incentive Fee Cap in any quarter is equal to the difference between (a) 20.0% of Cumulative Pre-Incentive Fee Net Income Per Share (as defined below) and
(b) Cumulative Incentive Fees Paid Per Share (as defined below). To the extent the Incentive Fee Cap is zero or a negative value in any quarter, no incentive fee would be payable in
that quarter. “Cumulative Pre-Incentive Fee Net Income Per Share” under the Investment Advisory Agreement is equal to the sum of Pre-Incentive Fee Net Income Per Share (as
defined below) for each quarter since April 13, 2010. “Pre-Incentive Fee Net Income Per Share” for any quarter is equal to (a) the sum of (i) Pre-Incentive Fee Net Investment Income
(as defined below) and (ii) Adjusted Capital Returns (as defined below) for the quarter divided by (b) the weighted average number of shares of our common stock outstanding during
such quarter. “Adjusted Capital Returns” for any quarter shall be the sum of the realized aggregate capital gains, realized aggregate capital losses, aggregate unrealized capital
depreciation and aggregate unrealized capital appreciation for such quarter; provided that the calculation of realized aggregate capital gains, realized aggregate capital losses,
aggregate unrealized capital depreciation and aggregate unrealized capital appreciation shall not include any realized capital gains, realized capital losses or unrealized capital
appreciation or depreciation resulting solely from the purchase accounting for any premium or discount paid for the acquisition of assets in a merger. “Cumulative Incentive Fees Paid
Per Share” is equal to the sum of Incentive Fees Paid Per Share for each quarter (or portion thereof) since April 13, 2010. “Incentive Fees Paid Per Share” for any quarter is equal to
the incentive fees accrued and/or payable by us for such period divided by the weighted average number of shares of our common stock outstanding during such period.
“Pre-Incentive Fee Net Investment Income” means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring,
diligence and consulting fees or other fees that we receive from portfolio companies but excluding fees for providing managerial assistance) accrued during the period, minus operating
expenses for the calendar quarter (including the base management fee, taxes, any expenses payable under the Investment Advisory Agreement and the Administration Agreement,
any expenses of securitizations and any interest expense and dividends paid on any outstanding preferred stock, but excluding the applicable incentive fees). Pre-Incentive Fee Net
Investment Income includes, in the case of investments with a deferred interest feature such as market discount, debt instruments with PIK interest, preferred stock with PIK dividends,
and zero coupon securities, accrued income that we have not yet received in cash. GC Advisors does not return to us amounts paid to it on accrued income that we have not yet
received in cash if such income is not ultimately received by us in cash. If we do not ultimately receive income, a loss would be recognized, reducing future fees. The Investment
Advisory Agreement excludes the impact of purchase accounting resulting from a merger, including the Merger, from the calculation of income subject to the income incentive fee
payable and the calculation of the Incentive Fee Cap. As a result, under the Investment Advisory Agreement, Pre-Incentive Fee Net Investment Income does not include any realized
capital gains, realized capital losses or unrealized capital appreciation or depreciation or any amortization or accretion of any purchase premium or purchase discount to interest income
resulting solely from the purchase accounting for any premium or discount paid for the acquisition of assets in a merger, such as the premium to net asset value paid for the shares of
GCIC common stock in the Merger.
Each of the Investment Advisory Agreement and Prior Investment Advisory Agreement converts the cumulative incentive fee cap from an aggregate basis calculation to a per share
calculation. If, for any relevant period, the Incentive Fee Cap calculation results in our paying less than the amount of the Incentive Fee calculated above, then the difference between
(a) the Incentive Fees accrued and/or payable by us for such relevant period and (b) the Incentive Fee Cap multiplied by the weighted average number of shares of our common stock
outstanding during such relevant period will not be paid by us, and will not be received by GC Advisors, as an incentive fee, either at the end of such relevant period or at the end of
any future relevant period.
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Income and Capital Gains Incentive Fee Calculation
The income and capital gains incentive fee calculation, or the Income and Capital Gains Incentive Fee Calculation, has two parts: the income component and the capital gains
component. The income component is calculated quarterly in arrears based on our Pre-Incentive Fee Net Investment Income for the immediately preceding calendar quarter.
Pre-Incentive Fee Net Investment Income, expressed as a rate of return on the value of our net assets (defined as total assets less indebtedness and before taking into account any
incentive fees payable during the period) at the end of the immediately preceding calendar quarter, is compared to a fixed “hurdle rate” of 2.0% quarterly. If market interest rates rise,
we could have the ability to invest funds in debt instruments that provide for a higher return, which would increase our Pre-Incentive Fee Net Investment Income and make it easier for
GC Advisors to surpass the fixed hurdle rate and receive an incentive fee based on such net investment income. Pre-Incentive Fee Net Investment Income used to calculate this part of
the incentive fee is also included in the amount of our total assets (excluding cash and cash equivalents but including assets purchased with borrowed funds and securitization-related
assets and cash collateral on deposit with custodian) used to calculate the base management fee, which fee is payable on all of our assets managed by GC Advisors.
We calculate the income component of the Income and Capital Gains Incentive Fee Calculation with respect to our Pre-Incentive Fee Net Investment Income quarterly, in arrears, as
follows:
•
•
•
zero in any calendar quarter in which the Pre-Incentive Fee Net Investment Income does not exceed the hurdle rate;
100.0% of our Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee Net Investment Income, if any, that exceeds the hurdle rate but is
less than 2.5% in any calendar quarter. We refer to this portion of our Pre-Incentive Fee Net Investment Income (which exceeds the hurdle rate but is less than 2.5%) as the
“catch-up” provision. The catch-up is meant to provide GC Advisors with 20.0% of the Pre-Incentive Fee Net Investment Income as if a hurdle rate did not apply if this net
investment income exceeds 2.5% in any calendar quarter; and
20.0% of the amount of our Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.5% in any calendar quarter.
The sum of these calculations yields the “Income Incentive Fee”. This amount is appropriately adjusted for any share issuances or repurchases during the quarter.
The following is a graphical representation of the Income Incentive Fee calculation:
Quarterly Income Component of Income and Capital Gains Incentive Fee Calculation Based on Net Income
Pre-Incentive Fee Net Investment Income
(Expressed as a Percentage of the Value of Net Assets)
Percentage of Pre-Incentive Fee Net Investment Income Allocated to Income Component of Income and Capital Gains Incentive Fee Calculation
The second part of the Income and Capital Gains Incentive Fee Calculation, or the Capital Gain Incentive Fee, equals (a) 20.0% of our Capital Gain Incentive Fee Base (as defined
below), if any, calculated in arrears as of the end of each calendar year (or upon termination of the Investment Advisory Agreement, as of the termination date), commencing with the
calendar year ending December 31, 2010, less (b) the aggregate amount of any previously paid Capital Gain Incentive Fees. Our “Capital Gain Incentive Fee Base” equals (1) the sum
of (i) our realized capital gains, if any, on a cumulative positive basis from April 13, 2010 through the end of each calendar year, (ii) all realized capital losses on a cumulative basis and
(iii) all unrealized capital depreciation on a cumulative basis less
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(2) all unamortized deferred financing costs, if and to the extent such costs exceed all unrealized capital appreciation on a cumulative basis.
•
•
•
The cumulative aggregate realized capital losses are calculated as the sum of the amounts by which (a) the net sales price of each investment in our portfolio when sold is
less than (b) the accreted or amortized cost basis of such investment.
The cumulative aggregate realized capital gains are calculated as the sum of the differences, if positive, between (a) the net sales price of each investment in our portfolio
when sold and (b) the accreted or amortized cost basis of such investment.
The aggregate unrealized capital depreciation is calculated as the sum of the differences, if negative, between (a) the valuation of each investment in our portfolio as of the
applicable Capital Gain Incentive Fee calculation date and (b) the accreted or amortized cost basis of such investment.
Realized capital gains and losses include gains and losses on investments, foreign currencies, including gains and losses on borrowings in foreign currencies, derivative contracts and
any income tax related to cumulative aggregate realized gains and losses. There was no Capital Gain Incentive Fee payable as calculated under the Prior Investment Advisory
Agreement, as applicable (as described above) for each of the years ended September 30, 2023, 2022 and 2021. However, in accordance with U.S. generally accepted accounting
principles, or GAAP, we are required to accrue for the Capital Gain Incentive Fee on a quarterly basis and are further required to include the aggregate unrealized capital appreciation
on investments when calculating the capital gain incentive fee accrual, as if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not
permitted to be considered in calculating the fee actually payable under either the Investment Advisory Agreement or Prior Investment Advisory Agreement. If the Capital Gain
Incentive Fee Base, adjusted as required by GAAP to include unrealized appreciation, is positive at the end of a period, then GAAP requires us to accrue a capital gain incentive fee
equal to 20% of such amount, less the aggregate amount of the actual capital gain incentive fees paid or capital gain incentive fees accrued under GAAP in all prior periods. If such
amount is negative, then there is no accrual for such period. The resulting accrual under GAAP for any capital gain incentive fee payable in a given period may result in additional
expense if such cumulative amount is greater than in the prior period or a reversal of previously recorded expense if such cumulative amount is less than in the prior period. There can
be no assurance that such unrealized capital appreciation will be realized in the future. Any payment due under the terms of the Investment Advisory Agreement is calculated in arrears
at the end of each calendar year. For the years ended September 30, 2023, 2022 and 2021, we did not accrue a Capital Gain Incentive Fee under GAAP.
The sum of the Income Incentive Fee and the Capital Gain Incentive Fee is the “Incentive Fee”.
Examples of Quarterly Incentive Fee Calculation
(1)
Example 1 — Income Related Portion of Incentive Fee :
Assumptions
(2)
Hurdle rate = 2.00%
Management fee = 0.50%
(3)
Other expenses (legal, accounting, custodian, transfer agent, etc.)
(4)
= 0.35%
(1) The hypothetical amount of Pre-Incentive Fee Net Investment Income shown is based on a percentage of total net assets. In addition, the example assumes that during the most
recent four full calendar quarter period ending on or prior to the date the payment set forth in the example is to be made, the sum of (a) our aggregate distributions to our
stockholders and (b) our change in net assets (defined as total assets less indebtedness and before taking into account any incentive fees payable during the period) is at least
8.0% of our net assets at the beginning of such period (as adjusted for any share issuances or repurchases).
(2) Represents a quarter of the 8.0% annualized hurdle rate.
(3) Represents a quarter of the 1.000% annualized management fee on gross assets, assuming 1.0x debt-to-equity.
(4) Excludes offering expenses.
Alternative 1
Additional Assumptions
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Investment income (including interest, dividends, fees, etc.) = 1.25%
Pre-Incentive Fee Net Investment Income (investment income adjusted to exclude amortization of purchase premium – (management fee + other expenses)) = 0.40%
Pre-Incentive Fee Net Investment Income does not exceed the hurdle rate, therefore there is no Incentive Fee.
Alternative 2
Additional Assumptions
Investment income (including interest, dividends, fees, etc.) = 3.25%
Pre-Incentive Fee Net Investment Income (investment income adjusted to exclude amortization of purchase premium – (management fee + other expenses)) = 2.40%
Pre-Incentive Fee Net Investment Income exceeds hurdle rate, therefore there is an Incentive Fee.
Incentive Fee
100% × “catch-up” + the greater of 0% AND (20% × (Pre-Incentive Fee Net Investment Income – 2.50%))
(100% × (2.40% – 2.00%)) + 0%
100% × 0.40%
0.40%
Alternative 3
Additional Assumptions
Investment income (including interest, dividends, fees, etc.) = 4.00%
Pre-Incentive Fee Net Investment Income (investment income – (management fee + other expenses)) = 3.15%
Pre-Incentive Fee Net Investment Income exceeds hurdle rate, therefore there is an Incentive Fee.
Incentive Fee
100% × “catch-up” + the greater of 0% AND (20% × (Pre-Incentive Fee Net Investment Income – 2.50%))
(100% × (2.50% – 2.00%)) + (20% × (3.15% – 2.50%))
0.50% + (20% × 0.65%)
0.50% + 0.13%
0.63%
=
=
=
=
=
=
=
=
=
Example 2 — Capital Gain Incentive Fee:
Alternative 1
Assumptions
Year 1:
Year 2:
Year 3:
Year 4:
$20 million investment made in Company A (“Investment A”) and an investment in Company B acquired in a merger (“Investment B”); Investment B is allocated
consideration paid, or a cost basis in accordance with GAAP, of $31.5 million.
Investment A is sold for $15 million and fair market value (“FMV”) of Investment B determined to be $29 million
FMV of Investment B determined to be $27 million
Investment B sold for $25 million
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The Capital Gain Incentive Fee, if any, would be:
Year 1:
Year 2:
Year 3:
Year 4:
None (No sales transactions)
None (Sales transaction resulted in a realized capital loss on Investment A)
None (No sales transactions)
None (Sales transaction resulted in a realized capital loss on Investment B)
Each quarterly incentive fee payable on the Income and Capital Gains Incentive Fee Calculation is subject to the Incentive Fee Cap. Below are the necessary adjustments to the
Incentive Fee payable to adhere to the Incentive Fee Cap.
Additional Assumptions
Year 1:
Year 2:
Year 3:
Year 4:
Year 1:
Year 2:
Year 3:
Year 4:
Alternative 2
Assumption
Year 1:
Year 2:
Year 3:
Year 4:
Year 5:
Investment B has a FMV of $30.0 million at the time of the closing of the merger, resulting in a cost basis for purposes of calculating the Incentive Fee Cap of
$30 million (excluding the $1.5 million purchase premium paid for the acquisition of Investment B in a merger and corresponding $1.5 million unrealized loss); we
have 10,000,000 shares of common stock issued and outstanding
We have 10,000,000 shares of common stock issued and outstanding
We issued 1,000,000 shares of common stock and has 11,000,000 shares of common stock issued and outstanding
We have 11,000,000 shares of common stock issued and outstanding
No adjustment; no realized capital losses or unrealized capital depreciation
Investment A sold at a $5 million loss. Investment B has unrealized capital depreciation of $1 million for purposes of calculating the Incentive Fee Cap. Therefore,
GC Advisors would not be paid on the $0.60 per share realized/unrealized loss which would result in a lower Incentive Fee by $0.12 per share.
Investment B has unrealized capital depreciation of $2 million for purposes of calculating the Incentive Fee Cap. Therefore, GC Advisors would not be paid on
the $0.18 per share unrealized capital depreciation, which would result in a lower Incentive Fee by $0.04 per share.
Investment B sold resulting in a $5 million realized loss for purposes of calculating the Incentive Fee Cap. Investment B was previously marked down by
$3 million for purposes of calculating the New Incentive Fee Cap; therefore, for purposes of calculating the New Incentive Fee Cap we would realize a $5 million
loss on Investment B and reverse the previous $3 million in unrealized capital depreciation. The net effect would be a loss for purposes of calculating the
Incentive Fee Cap of $2 million. GC Advisors would not be paid on the $0.18 per share loss which would result in a lower Incentive Fee by $0.04 per share.
$20 million investment made in Company A (“Investment A”), an investment in Company B acquired in a merger (“Investment B”); Investment B is allocated
consideration paid, or a cost basis in accordance with GAAP, of $31.5 million, and $25 million investment made in Company C (“Investment C”)
FMV of Investment A determined to be $18 million, FMV of Investment B determined to be $25 million and FMV of Investment C determined to be $25 million
Investment A sold for $18 million. FMV of Investment B determined to be $24 million and FMV of Investment C determined to be $25 million.
FMV of Investment B determined to be $22 million. Investment C sold for $24 million.
Investment B sold for $20 million
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The Capital Gain Incentive Fee, if any, would be:
Year 1:
Year 2:
Year 3:
Year 4:
Year 5:
None (No sales transactions)
None (No sales transactions)
None (Sales transaction resulted in a realized capital loss on Investment A)
None (Sales transaction resulted in a realized capital loss on Investment C)
None (Sales transaction resulted in a realized capital loss on Investment B)
Each quarterly Incentive Fee payable on the Income and Capital Gains Incentive Fee Calculation is subject to the Incentive Fee Cap. Below are the necessary adjustments to the
Incentive Fee payable to adhere to the Incentive Fee Cap.
Additional Assumptions
Year 1:
Year 2:
Year 3:
Year 4:
Year 5:
Year 1:
Year 2:
Year 3:
Year 4:
Year 5:
Investment B has an FMV of $30.0 million at the time of the closing of the merger, resulting in a cost basis for purposes of calculating the Incentive Fee Cap of
$30 million (excluding the $1.5 million purchase premium paid for the acquisition of Investment B in a merger and corresponding $1.5 million unrealized loss); we
have 10,000,000 shares of common stock issued and outstanding
We have 10,000,000 shares of common stock issued and outstanding
We issue 1,000,000 shares of common stock and have 11,000,000 shares of common stock issued and outstanding
We have 11,000,000 shares of common stock issued and outstanding
We have 11,000,000 shares of common stock issued and outstanding
No adjustment; no realized capital losses or unrealized capital depreciation.
Investment A has unrealized capital depreciation of $2 million. Investment B has unrealized capital depreciation of $5 million for purposes of calculating the
Incentive Fee Cap. Therefore, GC Advisors would not be paid on the $0.70 per share unrealized capital depreciation which would result in a lower Incentive Fee
by $0.14 per share.
Investment A sold at a $2 million loss. Investment A was previously marked down by $2 million; therefore, we would realize a $2 million loss on Investment A and
reverse the previous $2 million in unrealized capital depreciation. Investment B has additional unrealized capital depreciation of$1 million for purposes of
calculating the Incentive Fee Cap. The net effect would be a loss of$1 million for purposes of calculating the Incentive Fee Cap. GC Advisors would not be paid
on the $0.09 per share loss, which would result in a lower Incentive Fee by $0.02 per share.
Investment B has additional unrealized capital depreciation of $2 million for purposes of calculating the Incentive Fee Cap. Investment C sold at a $1 million
realized loss. The net effect would be a loss of $3 million for purposes of calculating the Incentive Fee Cap. GC Advisors would not be paid on the $0.27 per
share loss, which would result in a lower Incentive Fee by $0.05 per share.
Investment B sold resulting in a $10 million realized loss for purposes of calculating the Incentive Fee Cap. Investment B was previously marked down by
$8 million; therefore, we would realize a $10 million loss on Investment B and reverse the previous $8 million in unrealized capital depreciation. The net effect
would be a loss for purposes of calculating the Incentive Fee Cap of $2 million. GC Advisors would not be paid on the $0.18 per share loss, which would result in
a lower Incentive Fee by $0.04 per share.
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Alternative 3
Assumptions
Year 1:
Year 2:
Year 3:
Year 4:
$25 million investment made in Company A (“Investment A”) and an investment in Company B acquired in a merger (“Investment B”); Investment B is allocated
consideration paid, or a cost basis in accordance with GAAP, of $31.5 million
Investment A is sold for $30 million, FMV of Investment B determined to be $31 million and $2 million of unamortized deferred financing costs
FMV of Investment B determined to be $33 million and $1 million of unamortized deferred financing costs
Investment B sold for $33 million and $0 of unamortized deferred financing costs
The Capital Gain Incentive Fee, if any, would be:
Year 1:
Year 2:
Year 3:
Year 4:
None (No sales transactions)
$900,000 (20% multiplied by (i) $5 million realized capital gain on sale of Investment A less (ii) $0.5 million of unrealized loss).
$100,000 (20% multiplied by $5 million realized capital gains on sale of Investment A less $900,000 Capital Gain Incentive Fee paid in year 2).
$600,000 (20% multiplied by $8 million realized capital gains on sale of Investment A and Investment B less Capital Gain Incentive Fee paid in years 2 and 3).
Each quarterly Incentive Fee payable on the Income and Capital Gains Incentive Fee Calculation is subject to the Incentive Fee Cap. Below are the necessary adjustments to the
Incentive Fee payable to adhere to the Incentive Fee Cap
Additional Assumptions
Year 1:
Year 2:
Year 3:
Year 4:
Year 1:
Year 2:
Year 3:
Year 4:
Investment B has a FMV of $30.0 million at the time of the closing of the merger, resulting in a cost basis for purposes of calculating the Incentive Fee Cap of
$30 million (excluding the $1.5 million purchase premium paid for the acquisition of Investment B in a merger and corresponding $1.5 million unrealized loss); we
have 10,000,000 shares of common stock issued and outstanding
We have 10,000,000 shares of common stock issued and outstanding
We issue 1,000,000 shares of common stock and have 11,000,000 shares of common stock issued and outstanding
We have 11,000,000 shares of common stock issued and outstanding
No adjustment necessary
No adjustment necessary. GC Advisors would not be paid on the $1 million unrealized gain on Investment B.
No adjustment necessary. GC Advisors would not be paid on the $3 million unrealized gain on Investment B.
No adjustment necessary
Payment of Our Expenses
All investment professionals of GC Advisors and/or its affiliates, when and to the extent engaged in providing investment advisory and management services to us, and the
compensation and routine overhead expenses of personnel allocable to these services to us, are provided and paid for by GC Advisors and/or its affiliates and not by us. We bear all
other out-of-pocket costs and expenses of our operations and transactions. See “Management’s Discussion and Analysis of Financial Condition and Results of
Operations — Overview — Expenses.”
Duration and Termination
Unless terminated earlier as described below, the Investment Advisory Agreement will continue in effect for an initial two-year term and thereafter shall continue in effect from year to
year 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 that term is defined in the 1940 Act, of us or GC Advisors. The Investment Advisory Agreement automatically terminates in
the event of its assignment, as defined in the 1940 Act, by GC Advisors and could be terminated by either party without penalty
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upon not less than 60 days’ written notice to the other. The holders of a majority of our outstanding voting securities, by vote, can also terminate the Investment Advisory Agreement
without penalty. See “Risk Factors — Risks Relating to our Business and Structure — We are dependent upon GC Advisors for our future success and upon their access to the
investment professionals and partners of Golub Capital and its affiliates.”
Indemnification
The Investment Advisory Agreement provides that, absent willful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of the reckless disregard of its
duties and obligations, GC Advisors and its officers, managers, partners, agents, employees, controlling persons, members and any other person or entity affiliated with it are entitled to
indemnification from us for any damages, liabilities, costs and expenses (including reasonable attorneys’ fees and amounts reasonably paid in settlement) arising from the rendering of
GC Advisors’ services under the Investment Advisory Agreement or otherwise as our investment adviser.
Approval of the Investment Advisory Agreement
At a meeting of our board of directors held on August 3, 2023, our board of directors, including all of our independent directors, approved the Investment Advisory Agreement.
In reaching a decision to approve the Investment Advisory Agreement, our board of directors reviewed a significant amount of information and considered, among other things:
•
•
•
•
•
•
the nature, extent and quality of services provided to us by GC Advisors;
the relative investment performance of us since inception;
the relative investment performance of GBDC 3, GDLC, GDLCU and GBDC 4;
the fee structure, including the reduced base management fee rate as well as the incentive fees payable and the incentive fee cap;
the fees paid by other comparable business development companies; and
various other matters.
Our board of directors noted that the terms of the Investment Advisory Agreement did not change the calculation of the Capital Gain Incentive Fee, or the incentive fee rates, and that
the only change, as compared to the Prior Investment Advisory Agreement was to reduce the base management fee rate from 1.375% to 1.0% .
Administration Agreement
Pursuant to the Administration Agreement, the Administrator furnishes us with office facilities and equipment and provides clerical, bookkeeping, recordkeeping and other
administrative services at such facilities. Under the Administration Agreement, the Administrator performs, or oversees the performance of, our required administrative services, which
include being responsible for the financial records that we are required to maintain and preparing reports to our stockholders and reports filed with the SEC. In addition, the
Administrator assists us in determining and publishing our net asset value, oversees the preparation and filing of our tax returns and the printing and dissemination of reports to our
stockholders, and generally oversees the payment of our expenses and the performance of administrative and professional services rendered to us by others. The Administrator can
retain third parties to assist in providing administrative services to us. To the extent that the Administrator outsources any of its functions, we pay the fees associated with such
functions on a direct basis without profit to the Administrator. We reimburse the Administrator for the allocable portion (subject to review and approval of our board of directors) of the
Administrator’s overhead and other expenses incurred by it in performing its obligations under the Administration Agreement, including rent, the fees and expenses associated with
performing compliance functions and our allocable portion of the cost of our chief financial officer and chief compliance officer and their respective staffs. Our board of directors reviews
the expenses reimbursed to the Administrator, including any allocation of expenses among us and other entities for which the Administrator provides similar services, to determine that
these expenses are reasonable and comparable to administrative services charged by unaffiliated third-party asset managers. In addition, if requested to provide managerial assistance
to our portfolio companies, the Administrator is paid an additional amount based on the cost of the services provided, which shall not exceed the amount we receive from such portfolio
companies for providing this assistance. In May 2023, the Administration Agreement was renewed for a one-year term with the unanimous approval of our board of directors. The
Administration Agreement could be terminated by either party without penalty upon 60 days’ written notice to the other party.
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Indemnification
The Administration Agreement provides that, absent willful misfeasance, bad faith or negligence in the performance of its duties or by reason of the reckless disregard of its duties and
obligations, the Administrator and its officers, managers, partners, agents, employees, controlling persons, members and any other person or entity affiliated with it are entitled to
indemnification from us for any damages, liabilities, costs and expenses (including reasonable attorneys’ fees and amounts reasonably paid in settlement) arising from the rendering of
the Administrator’s services under the Administration Agreement or otherwise as our administrator.
License Agreement
We have entered into a license agreement with Golub Capital LLC under which Golub Capital LLC has granted us a non-exclusive, royalty-free license to use the name “Golub
Capital”. Under this agreement, we will have a right to use the “Golub Capital” name and the agreement will remain in effect for so long as GC Advisors or one of its affiliates remains
our investment adviser. Other than with respect to this limited license, we will have no legal right to the “Golub Capital” name.
Staffing Agreement
We do not have any internal management capacity or employees. We depend on the diligence, skill and network of business contacts of the senior investment professionals of GC
Advisors to achieve our investment objective. GC Advisors is an affiliate of Golub Capital LLC and depends upon access to the investment professionals and other resources of Golub
Capital LLC and its affiliates to fulfill its obligations to us under the Investment Advisory Agreement. GC Advisors also depends upon Golub Capital LLC to obtain access to deal flow
generated by the professionals of Golub Capital LLC and its affiliates. Under the Staffing Agreement, Golub Capital LLC provides GC Advisors with the resources necessary to fulfill
these obligations. The Staffing Agreement provides that Golub Capital LLC will make available to GC Advisors experienced investment professionals and access to the senior
investment personnel of Golub Capital LLC for purposes of evaluating, negotiating, structuring, closing and monitoring our investments. The Staffing Agreement also includes a
commitment that the members of GC Advisors’ investment committee serve in such capacity. The Staffing Agreement remains in effect until terminated and could be terminated by
either party without penalty upon 60 days’ written notice to the other party. Services under the Staffing Agreement are provided to GC Advisors on a direct cost reimbursement basis,
and such fees are not our obligation.
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REGULATION
General
We are a business development company under the 1940 Act and have elected to be treated as a RIC under the Code. The 1940 Act contains prohibitions and restrictions relating to
transactions between business development companies and their affiliates (including any investment advisers), principal underwriters and affiliates of those affiliates or underwriters
and requires that a majority of the directors of a business development company be persons other than “interested persons,” as that term is defined in the 1940 Act. In addition, the
1940 Act provides that we cannot change the nature of our business so as to cease to be, or withdraw our election as, a business development company without the approval of a
majority of our outstanding voting securities.
We can invest up to 100% of our assets in securities acquired directly from issuers in privately negotiated transactions. With respect to such securities, we could, for the purpose of
public resale, be deemed an “underwriter,” as that term is defined in the Securities Act of 1933, as amended, or 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 could enter into hedging transactions to manage the risks associated
with interest rate or foreign currency fluctuations. However, we could 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 in excess of the limits imposed by the 1940 Act. With
regard to that portion of our portfolio invested in securities issued by investment companies, it should be noted that such investments may subject our stockholders to additional
expenses. None of these policies, or any of our other policies, is fundamental and each could be changed without stockholder approval. To the extent we adopt any fundamental
policies; no person from whom we borrow will have, in his or her capacity as lender or debt holder, either a veto power or a vote in approving or changing any of our fundamental
policies.
Qualifying Assets
Under the 1940 Act, a business development company is restricted from acquiring any asset other than assets of the type listed in Section 55(a) of the 1940 Act, which are referred to
as “qualifying assets,” unless, at the time the acquisition is made, qualifying assets represent at least 70% of the company’s total assets. The principal categories of qualifying assets
relevant to our business are the following:
(1)
Securities purchased in transactions not involving any public offering from the issuer of such securities, which issuer (subject to certain limited exceptions) is an eligible portfolio
company, or from any person who is, or has been during the preceding 13 months, an affiliated person of an eligible portfolio company, or from any other person, subject to
such rules as could be prescribed by the SEC. An eligible portfolio company is defined in the 1940 Act as any issuer that:
a is organized under the laws of, and has its principal place of business in, the United States;
b is not an investment company (other than a small business investment company, or SBIC, wholly owned by the business development company) or a company that would
be an investment company but for certain exclusions under the 1940 Act; and
c satisfies either of the following:
i does not have any class of securities listed on a national securities exchange or has any class of securities listed on a national securities exchange subject to a
$250.0 million market capitalization maximum; or
ii
is controlled by a business development company or a group of companies including a business development company, the business development company actually
exercises a controlling influence over the management or policies of the eligible portfolio company, and, as a result, the business development company has an
affiliated person who is a director of the eligible portfolio company.
(2)
Securities of any eligible portfolio company which we control.
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(3)
(4)
(5)
(6)
Securities purchased in a private transaction from a U.S. issuer that is not an investment company or from an affiliated person of the issuer, or in transactions incident to such a
private transaction, if the issuer is in bankruptcy and subject to reorganization or if the issuer, immediately prior to the purchase of its securities, was unable to meet its
obligations as they came due without material assistance other than conventional lending or financing arrangements.
Securities of an eligible portfolio company purchased from any person in a private transaction if there is no ready market for such securities and we already own 60% of the
outstanding equity of the eligible portfolio company.
Securities received in exchange for or distributed on or with respect to securities described above, or pursuant to the exercise of warrants or rights relating to such securities.
Cash, cash equivalents, U.S. government securities or high-quality debt securities that mature in one year or less from the date of investment.
The regulations defining and interpreting qualifying assets can change over time. We could adjust our investment focus as needed to comply with and/or take advantage of any
regulatory, legislative, administrative or judicial actions in this area.
We look through our consolidated subsidiaries to the underlying holdings (considered together with portfolio assets held outside of our consolidated subsidiaries) for purposes of
determining compliance with the 70% qualifying assets requirement of the 1940 Act. At least 70% of our assets will be eligible assets.
Managerial Assistance to Portfolio Companies
A business development company must have been organized and have its principal place of business in the United States and must be operated for the purpose of making
investments in the types of securities described in (1), (2) or (3) above. However, in order to count portfolio securities as qualifying assets for the purpose of the 70% test, the business
development company 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, when
the business development company purchases such securities in conjunction with one or more other persons acting together, one of the other persons in the group could make
available such managerial assistance. Making available significant managerial assistance means any arrangement whereby the business development company, through its directors,
officers or employees, offers to provide, and, if accepted, does so provide, significant guidance and counsel concerning the management, operations or business objectives and policies
of a portfolio company. The Administrator or an affiliate of the Administrator provides such managerial assistance on our behalf to portfolio companies that request this assistance.
Temporary Investments
Pending investment in other types of qualifying assets, as described above, our investments could consist of cash, cash equivalents, U.S. government securities, repurchase
agreements and high-quality debt investments that mature in one year or less from the date of investment, which we refer to, collectively, as temporary investments, so that 70% of our
assets are qualifying assets or temporary investments. Typically, we will invest in U.S. Treasury bills or in repurchase agreements, so long as the agreements are fully collateralized by
cash or securities issued by the U.S. government or its agencies. A repurchase agreement involves the purchase by an investor, such as us, of a specified security and the
simultaneous agreement by the seller to repurchase it at an agreed-upon future date and at a price that is greater than the purchase price by an amount that reflects an agreed-upon
interest rate. There is no percentage restriction on the proportion of our assets that could be invested in such repurchase agreements. However, if more than 25% of our total assets
constitute repurchase agreements from a single counterparty, we would generally not meet the diversification tests described in Section 851(b)(3) of the Code in order to qualify as a
RIC for U.S. federal income tax purposes. Accordingly, we do not intend to enter into repurchase agreements with a single counterparty in excess of this limit. GC Advisors will monitor
the creditworthiness of the counterparties with which we enter into repurchase agreement transactions.
Senior Securities
We are permitted, under specified conditions, to issue multiple classes of indebtedness and one class of stock senior to our common stock if our asset coverage, as that term is defined
in the 1940 Act, is at least equal to 200% (or 150% upon receipt of certain approvals and subject to the requirement that we make an offer to repurchase the shares of our stockholders)
immediately after each
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such issuance (or such other percentage as could be prescribed by law from time to time). Prior to the enactment of the Small Business Credit Availability Act, or SBCAA, in March
2018, the asset coverage requirement applicable to business development companies was 200%. The SBCAA permits a business development company to be subject to an asset
coverage requirement of 150% so long as it meets certain disclosure requirements and obtains certain approvals. The reduced asset coverage requirement permits a business
development company to have a ratio of total consolidated assets to outstanding indebtedness of 2:1 as compared to a maximum of 1:1 under the 200% asset coverage requirement.
On February 5, 2019, our stockholders voted to approve the application of the reduced asset coverage requirements in Section 61(a)(2) to us effective as of February 6, 2019. As a
result of the stockholder approval, effective February 6, 2019, the asset coverage ratio under the 1940 Act applicable to us decreased to 150% from 200%. In other words, under the
1940 Act, we are now able to borrow $2 for investment purposes for every $1 of investor equity, as opposed to borrowing $1 for investment purposes for every $1 of investor equity. In
addition, while any senior securities remain outstanding, we must make provisions to prohibit any distribution to our stockholders or the repurchase of such securities or shares unless
we meet the applicable asset coverage ratios at the time of the distribution or repurchase. We can also borrow amounts up to 5% of the value of our total assets for temporary or
emergency purposes without regard to asset coverage, provided that any such borrowings in excess of 5% of the value of our total assets would be subject to the asset coverage ratio
requirements of the 1940 Act, even if for temporary or emergency purposes. We consolidate our financial results with all of our wholly-owned subsidiaries, including Holdings, GCIC
Holdings, the 2018 Issuer, the GCIC 2018 Issuer, the 2020 Issuer, the 2018 CLO Depositor, the GCIC CLO Depositor, GCIC Funding, GBDC Holdings Coinvest, Inc, GBDC Holdings
ED Coinvest, Inc., GCIC North Haven Stack Buyer Coinvest, Inc., GCIC Quick Quack Coinvest LLC, and GBDC Quick Quack Coinvest LLC for financial reporting purposes and
measure our compliance with the leverage test applicable to business development companies under the 1940 Act on a consolidated basis.
For a discussion of the risks associated with leverage, see “Risk Factors — Risks Relating to our Business and Structure — Regulations governing our operation as a business
development company affect our ability to, and the way in which we, raise additional capital. As a business development company, the necessity of raising additional capital exposes
us to risks, including the typical risks associated with leverage.”
Codes of Ethics
We and GC Advisors have each adopted a code of ethics pursuant to Rule 17j-1 under the 1940 Act that establishes procedures for personal investments and restricts certain personal
securities transactions. Personnel subject to each code can invest in securities for their personal investment accounts, including securities that can be purchased or held by us, so long
as such investments are made in accordance with the code’s requirements. You can read and copy the code of ethics from our website at www.golubcapitalbdc.com, or from the
SEC’s website at www.sec.gov. See “Business — General — Information Available.” In addition, each code of ethics is attached as an exhibit to this annual report on Form 10-K.
Proxy Voting Policies and Procedures
We have delegated our proxy voting responsibility to GC Advisors. The proxy voting policies and procedures of GC Advisors are set out below. The guidelines are reviewed periodically
by GC Advisors and our directors who are not “interested persons” and, accordingly, are subject to change.
Introduction
As an investment adviser registered under the Advisers Act, GC Advisors has a fiduciary duty to act solely in our best interests. As part of this duty, GC Advisors recognizes that it must
vote our securities in a timely manner free of conflicts of interest and in our best interests.
GC Advisors’ policies and procedures for voting proxies for its investment advisory clients are intended to comply with Section 206 of, and Rule 206(4)-6 under, the Advisers Act.
Proxy Policies
GC Advisors votes proxies relating to our portfolio securities in what it perceives to be the best interest of our stockholders. GC Advisors reviews on a case-by-case basis each proposal
submitted to a stockholder vote to determine its effect on the portfolio securities we hold. In most cases GC Advisors will vote in favor of proposals that GC Advisors believes are likely
to increase the value of the portfolio securities we hold. Although GC Advisors will generally vote against proposals that could have a negative effect on our portfolio securities, GC
Advisors could vote for such a proposal if there exist compelling long-term reasons to do so.
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Our proxy voting decisions are made by GC Advisors’ chief executive officer and president. To ensure that GC Advisors’ vote is not the product of a conflict of interest, GC Advisors
requires that (1) anyone involved in the decision-making process disclose to its chief compliance officer any potential conflict that he or she is aware of and any contact that he or she
has had with any interested party regarding a proxy vote and (2) employees involved in the decision-making process or vote administration are prohibited from revealing how GC
Advisors intends to vote on a proposal in order to reduce any attempted influence from interested parties. Where conflicts of interest may be present, GC Advisors will disclose such
conflicts to us, including our independent directors, and could request guidance from us on how to vote such proxies.
Proxy Voting Records
You can obtain information without charge about how GC Advisors voted proxies during the most recent 12-month period ended September 30, 2023 by making a written request for
proxy voting information to: Golub Capital BDC, Inc., Attention: Investor Relations, 200 Park Avenue, 25th Floor, New York, NY 10166, or by calling Golub Capital BDC, Inc. collect at
(212) 750-6060.
Privacy Principles
We are committed to maintaining the privacy of our stockholders and to safeguarding their nonpublic personal information.
We restrict access to nonpublic personal information about our stockholders to employees of GC Advisors and its affiliates with a legitimate business need for the information. We will
maintain physical, electronic and procedural safeguards designed to protect the nonpublic personal information of our stockholders.
Other
Under the 1940 Act, we are required to provide and maintain a bond issued by a reputable fidelity insurance company to protect us against larceny and embezzlement. Furthermore, as
a business development company, 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.
We and GC Advisors are required to adopt and implement written policies and procedures reasonably designed to prevent violation of relevant federal securities laws, review these
policies and procedures annually for their adequacy and the effectiveness of their implementation, and designate a chief compliance officer to be responsible for administering these
policies and procedures.
We could also be prohibited under the 1940 Act from knowingly participating in certain transactions with our affiliates without the prior approval of our board of directors who are not
interested persons and, in some cases, prior approval by the SEC. The SEC has interpreted the business development company prohibition on transactions with affiliates to prohibit
“joint transactions” among entities that share a common investment adviser. The staff of the SEC has granted no-action relief pursuant to which purchases by us and other accounts
sponsored or managed by GC Advisors or its affiliates of a single class of privately placed securities are permitted provided that the adviser negotiates no term other than price and
certain other conditions are met. Any co-investment would be made subject to compliance with existing regulatory guidance, applicable regulations and our allocation procedures. If
opportunities arise that would otherwise be appropriate for us and for another account sponsored or managed by GC Advisors to make different investments in the same issuer, GC
Advisors will need to decide which account will proceed with the investment. Moreover, in certain circumstances, we could be unable to invest in an issuer in which another account
sponsored or managed by GC Advisors has previously invested.
On February 27, 2017, GC Advisors and certain other funds and accounts sponsored or managed by GC Advisors and its affiliates, received exemptive relief from the SEC that permits
us greater flexibility to negotiate the terms of co-investments if our board of directors determines that it would be advantageous for us to co-invest with other accounts sponsored or
managed by GC Advisors or its affiliates in a manner consistent with our investment objectives, positions, policies, strategies and restrictions as well as regulatory requirements and
other pertinent factors. We believe that co-investment by us and accounts sponsored or managed by GC Advisors and its affiliates could afford us additional investment opportunities
and the ability to achieve greater diversification. Under the terms of this exemptive relief, a “required majority” (as defined in Section 57(o) of the 1940 Act) of our independent directors
is required to make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the proposed transaction are reasonable and fair to us and our
stockholders and do not involve
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overreaching of us or our stockholders on the part of any person concerned and (2) the transaction is consistent with the interests of our stockholders and is consistent with our
investment strategies and policies. On January 13, 2023, the SEC issued an order amending the existing co-investment exemptive relief order to incorporate the terms of the
temporary, conditional exemptive relief announced by the SEC on April 8, 2020 in order to permit those entities permitted to rely on the order to participate in certain follow-on co-
investment transactions.
Sarbanes-Oxley Act
The Sarbanes-Oxley Act of 2002, as amended, or the Sarbanes-Oxley Act, imposes a variety of regulatory requirements on companies with a class of securities registered under the
Securities Exchange Act of 1934, as amended, or the Exchange Act, and their insiders. Many of these requirements affect us. For example:
•
•
•
•
pursuant to Rule 13a-14 under the Exchange Act our principal executive officer and principal financial officer must certify the accuracy of the financial statements contained
in our periodic reports;
pursuant to Item 307 under Regulation S-K under the Securities Act our periodic reports must disclose our conclusions about the effectiveness of our disclosure controls
and procedures;
pursuant to Rule 13a-15 under the Exchange Act, 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; and
pursuant to Item 308 of Regulation S-K under the Securities Act and Rule 13a-15 under 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
under such act. 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
comply with that act.
Small Business Investment Company Regulations
On November 4, 2020, May 4, 2021 and September 21, 2021, SBIC IV, L.P., or SBIC IV, GC SBIC V, L.P., or SBIC V, and GC SBIC VI, L.P., or SBIC VI, respectively, surrendered their
licenses to operate as a small business investment company, or SBIC. Prior to the surrender of the licenses of each of SBIC IV, SBIC V, and SBIC VI, or collectively, the SBIC Funds,
we operated the SBIC Funds as wholly-owned subsidiaries of the Company.
The SBIC Funds each had investment objectives substantially similar to ours and made similar types of investments in accordance with SBIC regulations.
Prior to their surrender, the licenses approved by the U.S. Small Business Administration, or SBA, for the SBIC Funds allowed the SBIC Funds to incur leverage by issuing SBA-
guaranteed debentures, subject to the issuance of a capital commitment and certain approvals by the SBA and customary procedures. As of September 30, 2023, all SBA-guaranteed
debentures issued by each of the SBIC Funds have been repaid and no SBA-guaranteed debentures were outstanding at any of the SBIC Funds. SBA-guaranteed debentures carried
long-term fixed rates that were generally lower than rates on comparable bank and other debt, had a maturity of ten years, required semi-annual payments of interest and did not
require any principal payments prior to maturity. Under the regulations applicable to SBICs, each of the SBIC Funds was permitted to have outstanding debentures guaranteed by the
SBA generally in an amount of up to twice its regulatory capital, which generally equated to the amount of its equity capital. SBIC regulations limited the amount that a single SBIC
subsidiary could borrow to a maximum of $175.0 million, assuming that it had at least $87.5 million of equity capital. The SBIC Funds were subject to regulation and oversight by the
SBA, including requirements with respect to maintaining certain minimum financial ratios and other covenants.
The original amount committed to SBIC IV, SBIC V, and SBIC VI by the SBA was $150.0 million, $175.0 million, and $175.0 million, respectively. Through September 30, 2023, SBIC
IV, SBIC V, and SBIC VI have repaid all outstanding debentures, and these commitments have effectively been terminated.
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Under SBIC regulations, the SBIC Funds were permitted to make loans to eligible small businesses, invest in the equity securities of such businesses and provide them with consulting
and advisory services.
Material U.S. Federal Income Tax Considerations
The following discussion is a general summary of the material U.S. federal income tax considerations applicable to us and to an investment in our shares of common stock. This
summary does not purport to be a complete description of the income tax considerations applicable to such an investment. For example, we have not described certain considerations
that could be relevant to certain types of holders subject to special treatment under U.S. federal income tax laws, including stockholders subject to the alternative minimum tax, tax-
exempt organizations, insurance companies, dealers in securities, traders in securities that elect to mark-to-market their securities holdings, pension plans and trusts, persons that
have a functional currency (as defined in Section 985 of the Code) other than the U.S. dollar and financial institutions. This summary assumes that investors hold our common stock as
capital assets (within the meaning of Section 1221 of the Code). The discussion is based upon the Code, Treasury regulations, and administrative and judicial interpretations, each as
of the date of the filing of this Annual Report on Form 10-K and all of which are subject to change, possibly retroactively, which could affect the continuing validity of this discussion. We
have not sought and will not seek any ruling from the Internal Revenue Service, or the IRS, regarding any offering of our securities. This summary does not discuss any aspects of
U.S. estate or gift tax or foreign, state or local tax. It does not discuss the special treatment under U.S. federal income tax laws that could result if we invested in tax-exempt securities
or certain other investment assets. For purposes of this discussion, references to “dividends” are to dividends within the meaning of the U.S. federal income tax laws and associated
regulations and can include amounts subject to treatment as a return of capital under section 19(a) of the 1940 Act.
A “U.S. stockholder” is a beneficial owner of shares of our common stock that is for U.S. federal income tax purposes:
•
•
•
•
a citizen or individual resident of the United States;
a corporation, or other entity treated as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States or any state
thereof or the District of Columbia;
an estate, the income of which is subject to U.S. federal income taxation regardless of its source; or
a trust if either a U.S. court can exercise primary supervision over its administration and one or more U.S. persons have the authority to control all of its substantial
decisions or the trust was in existence on August 20, 1996, was treated as a U.S. person prior to that date, and has made a valid election to be treated as a U.S. person.
A “Non-U.S. stockholder” is a beneficial owner of shares of our common stock that is not a U.S. stockholder.
If a partnership (including an entity treated as a partnership for U.S. federal income tax purposes) holds shares of our common stock, the tax treatment of a partner in the partnership
will generally depend upon the status of the partner and the activities of the partnership. A prospective investor that is a partner in a partnership that will hold shares of our common
stock should consult its tax advisors with respect to the purchase, ownership and disposition of shares of our common stock.
Tax matters are very complicated and the tax consequences to an investor of an investment in our shares of common stock will depend on the facts of his, her or its particular situation.
We encourage investors to consult their own tax advisors regarding the specific consequences of such an investment, including tax reporting requirements, the applicability of U.S.
federal, state, local and foreign tax laws, eligibility for the benefits of any applicable tax treaty, and the effect of any possible changes in the tax laws.
Election to Be Taxed as a RIC
As a business development company, we have elected to be treated as a RIC under Subchapter M of the Code. As a RIC, we generally will not be subject to corporate-level U.S.
federal income taxes on any net ordinary income or capital gains that we timely distribute as dividends for U.S. federal income tax purposes to our stockholders. To qualify as a RIC, we
must, among other things,
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meet certain source-of-income and asset diversification requirements (as described below). In addition, we must distribute to our stockholders, for each taxable year, dividends for U.S.
federal income tax purposes of an amount at least equal to 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 and determined without regard to any deduction for dividends paid, or the Annual Distribution Requirement. Although
not required for us to maintain our RIC tax status, in order to preclude the imposition of a 4% nondeductible federal excise tax imposed on RICs, we must timely distribute dividends for
U.S. federal income tax purposes to our stockholders in respect of each calendar year of an amount at least equal to the sum of (1) 98% of our net ordinary income (taking into account
certain deferrals and elections) for the calendar year, (2) 98.2% of the excess (if any) of our realized capital gains over our realized capital losses, or capital gain net income (adjusted
for certain ordinary losses), generally for the one-year period ending on October 31 of the calendar year and (3) the sum of any net ordinary income plus capital gains net income for
preceding years that were recognized but not distributed during such years and on which we did not incur any liability to pay federal income tax, or the Excise Tax Avoidance
Requirement.
Taxation as a RIC
If we:
•
•
qualify as a RIC; and
satisfy 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 gain, defined as net long-term capital gains in excess of
net short-term capital losses, we timely distribute as dividends for U.S. federal income tax purposes to our stockholders. We will be subject to U.S. federal income tax at regular
corporate rates on any net income or net capital gain not distributed as dividends to our stockholders.
In order to qualify as a RIC for U.S. federal income tax purposes, we must, among other things:
•
•
•
qualify and have in effect an election to be treated as a business development company under the 1940 Act at all times during each taxable year;
derive in each taxable year at least 90% of our gross income from dividends, interest, payments with respect to certain securities loans, gains from the sale of stock or other
securities, or 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), or the 90% Income Test; and
diversify our holdings, so that at the end of each quarter of the taxable year:
◦
◦
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; and
no more than 25% of the value of our assets is invested in the securities, other than U.S. government securities or securities of other RICs, of one issuer or of 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 or in the
securities of one or more qualified publicly traded partnerships (the “Diversification Tests”).
We can invest in partnerships, including qualified publicly traded partnerships, which could result in our being subject to state, local or foreign income, franchise or other tax liabilities.
In addition, we are subject to ordinary income and capital gain distribution requirements under U.S. federal excise tax rules for each calendar year. If we do not meet the required
distributions we will be subject to a 4% nondeductible federal excise tax on the undistributed amount. The failure to meet U.S. federal excise tax distribution requirements will not cause
us to lose our RIC status, and we could choose to retain taxable income or capital gains in excess of current year distributions into the next tax year in an amount less than what would
trigger payments of federal income tax under Subchapter M of the Code. We could then be required to pay a 4% excise tax on such income or capital gains.
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A RIC is limited in its ability to deduct expenses in excess of its investment company taxable income. If our deductible expenses in a given taxable year exceed our investment
company taxable income, we may incur a net operating loss for that taxable year. However, a RIC is not permitted to carry forward net operating losses to subsequent taxable years
and such net operating losses do not pass through to its stockholders. In addition, deductible expenses can be used only to offset investment company taxable income, not net capital
gain. A RIC cannot use any net capital losses (that is, the excess of realized capital losses over realized capital gains) to offset its investment company taxable income, but may carry
forward such net capital losses, and use them to offset future capital gains, indefinitely. Due to these limits on deductibility of expenses and net capital losses, we could for tax purposes
have aggregate taxable income for several taxable years that we are required to distribute and that is taxable to our stockholders even if such taxable income is greater than the net
income we actually earn during those taxable years. Any underwriting fees paid by us are not deductible. We could be required to recognize taxable income in circumstances in which
we do not receive cash. For example, if we hold debt obligations that are treated under applicable tax rules as having original issue discount (such as debt instruments with PIK interest
or, in certain cases, with increasing interest rates or issued with warrants), we must include in income each year a portion of the original issue discount that accrues over the life of the
obligation, regardless of whether cash representing such income is received by us in the same taxable year. Because any original issue discount accrued will be included in our
investment company taxable income for the taxable year of accrual, we could 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. Furthermore, a portfolio company in which we hold equity or debt instruments could face
financial difficulty that requires us to work out, modify, or otherwise restructure such equity or debt instruments. Any such restructuring could, depending upon the terms of the
restructuring, cause us to incur unusable or nondeductible losses or recognize future non-cash taxable income.
Certain of our investment practices could be subject to special and complex U.S. federal income tax provisions that could, among other things, (1) treat dividends that would otherwise
constitute qualified dividend income as non-qualified dividend income, (2) treat dividends that would otherwise be eligible for the corporate dividends received deduction as ineligible for
such treatment, (3) disallow, suspend or otherwise limit the allowance of certain losses or deductions, (4) convert lower-taxed long-term capital gain into higher-taxed short-term capital
gain or ordinary income, (5) convert an ordinary loss or a deduction into a capital loss (the deductibility of which is more limited), (6) cause us to recognize income or gain without a
corresponding receipt of cash, (7) adversely affect the time as to when a purchase or sale of stock or securities is deemed to occur, (8) adversely alter the characterization of certain
complex financial transactions and (9) produce income that will not be qualifying income for purposes of the 90% Income Test. We intend to monitor our transactions and could make
certain tax elections to mitigate the effect of these provisions and prevent our ability to be subject to tax as a RIC. There can be no assurance that we will be eligible for any such tax
elections or that any adverse effects of these provisions will be mitigated.
Certain distributions reported by us as Section 163(j) interest dividends may be treated as interest income by stockholders for purposes of the tax rules applicable to interest expense
limitations under Section 163(j) of the Code. Such treatment by the stockholder is generally subject to holding period requirements and other potential limitations, although the holding
period requirements are generally not applicable to dividends declared by money market funds and certain other funds that declare dividends daily and pay such dividends on a monthly
or more frequent basis. The amount that we are eligible to report as a Section 163(j) dividend for a tax year is generally limited to the excess of our business interest income over the
sum of our (i) business interest expense and (ii) other deductions properly allocable to our business interest income.
We can invest a portion of our net assets in below investment grade instruments. Investments in these types of instruments can present special tax issues for us. U.S. federal income
tax rules are not entirely clear about issues such as when we can cease to accrue interest, original issue discount or market discount, when and to what extent deductions can be taken
for bad debts or worthless instruments, how payments received on obligations in default should be allocated between principal and income and whether exchanges of debt obligations
in a bankruptcy or workout context are taxable. We intend to address these and other issues to the extent necessary in order to seek to ensure that we distribute sufficient income to
avoid any material U.S. federal income tax or the 4% nondeductible U.S. federal excise tax.
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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.
Our investment in non-U.S. securities could be subject to non-U.S. income, withholding and other taxes. In that case, our yield on those securities would be decreased. U.S.
stockholders generally will not be entitled to claim a U.S. foreign tax credit or deduction with respect to non-U.S. taxes paid by us.
If we acquire shares in a passive foreign investment company (“PFIC”), we could be subject to U.S. federal income tax on a portion of any “excess distribution” received on, or any gain
from the disposition of, such shares even if we distribute such income as a taxable dividend to 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 invest in the shares of a PFIC and elect to treat the PFIC as a “qualified electing fund” under the
Code (a “QEF”), 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 by the QEF. Alternatively, we could elect to mark our shares in a PFIC at the end of each taxable year to market; in this case, we will
recognize as ordinary income any increase in the value of such shares, and as ordinary loss any decrease in such value to the extent that any such decrease does not exceed prior
increases in such value included in our income. Our ability to make either election will depend on factors beyond our control, and is subject to restrictions which could limit the
availability of the benefit of these elections. Under either election, we could be required to recognize in a taxable year income in excess of any distributions we receive from PFICs and
any proceeds from dispositions of PFIC stock during that taxable year, and such income will nevertheless be subject to the Annual Distribution Requirement and will be taken into
account for purposes of determining whether we satisfy the distribution requirements under U.S. federal excise tax rules.
Under Section 988 of the Code, gains or losses 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 are generally treated as ordinary income or loss. Similarly, gains or losses on foreign currency-
denominated forward, futures and option contracts, as well as certain other financial instruments, and the disposition of debt obligations denominated in a foreign currency, to the extent
attributable to fluctuations in exchange rates between the acquisition and disposition dates, are also treated as ordinary income or loss.
Although we do not presently expect to do so, we are authorized to borrow funds and to sell assets in order to satisfy distribution requirements. However, under the 1940 Act, we are not
permitted to make distributions to our stockholders while our debt obligations and other senior securities are outstanding unless certain “asset coverage” tests are met. See
“Business — Regulation — Senior Securities.” Moreover, our ability to dispose of assets to meet our distribution requirements may be limited by (1) the illiquid nature of our portfolio
and/or (2) other requirements relating to our qualification as a RIC, including the Diversification Tests. If we dispose of assets in order to meet the Annual Distribution Requirement or
the Excise Tax Avoidance Requirement, we may make such dispositions at times that, from an investment standpoint, are not advantageous.
Some of the income and fees that we may recognize, such as fees for providing managerial assistance, certain fees earned with respect to our investments, income recognized in a
work-out or restructuring of a portfolio investment, or income recognized from an equity investment in an operating partnership, will not satisfy the 90% Income Test. In order to manage
the risk that such income and fees might disqualify us as a RIC for a failure to satisfy the 90% Income Test, we may be required to recognize such income and fees indirectly through
one or more entities treated as corporations for U.S. federal income tax purposes. Such corporations will be subject to U.S. corporate income tax as well as state and local tax on their
earnings, which ultimately will reduce our return on such income and fees.
Failure to Qualify as a RIC
If we were unable to qualify for treatment as a RIC and are unable to cure the failure, for example, by disposing of certain investments quickly or raising additional capital to prevent the
loss of RIC status, we generally would be subject to tax on all of our taxable income at regular corporate rates. The Code provides some relief from RIC disqualification due to failures to
comply with the 90% Income Test and the Diversification Tests, although there could be additional taxes due in such cases. We cannot assure you that we would qualify for any such
relief should we fail the 90% Income Test or the Diversification Tests.
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Should failure occur, not only would all our taxable income be subject to tax at regular corporate rates, we would not be able to deduct dividend 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 ordinary dividend income to the extent
of our current and accumulated earnings and profits. Subject to certain limitations under the Code, certain corporate stockholders would be eligible to claim dividends received
deduction with respect to such dividends and non-corporate stockholders would generally be able to treat such dividends as “qualified dividend income,” which is subject to reduced
rates of U.S. federal income tax. Distributions in excess of our current and accumulated earnings and profits would be treated first as a return of capital to the extent of the stockholder’s
tax basis, and any remaining distributions would be treated as a capital gain. If we fail to qualify as a RIC, we could 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 five taxable years.
The remainder of this discussion assumes that we qualify as a RIC and have satisfied the Annual Distribution Requirement.
Taxation of U.S. Stockholders
Distributions by us generally are taxable to U.S. stockholders as ordinary income or capital gains. Distributions of our “investment company taxable income” (which is, generally, our net
ordinary income plus net short-term capital gains in excess of net long-term capital losses) will be taxable as ordinary income to U.S. stockholders to the extent of our current or
accumulated earnings and profits, whether paid in cash or reinvested in additional shares of our common stock. To the extent such distributions paid by us to non-corporate
stockholders (including individuals) are attributable to dividends from U.S. corporations and certain qualified foreign corporations and if certain holding period requirements are met,
such distributions generally will be treated as qualified dividend income and generally eligible for a maximum U.S. federal tax rate of either 15% or 20%, depending on whether the
individual shareholder’s income exceeds certain threshold amounts, and if other applicable requirements are met, such distributions generally will be eligible for the corporate dividends
received deduction to the extent such dividends have been paid by a U.S. corporation. In this regard, it is anticipated that distributions paid by us will generally not be attributable to
dividends and, therefore, generally will not qualify for the preferential maximum U.S. federal tax rate applicable to non-corporate stockholders as well as will not be eligible for the
corporate dividends received deduction.
Distributions of our net capital gains (which is generally our realized net long-term capital gains in excess of realized net short-term capital losses) properly designated by us as “capital
gain dividends” will be taxable to a U.S. stockholder as long-term capital gains (currently generally at a maximum rate of either 15% or 20%, depending on whether the individual
shareholder’s income exceeds certain threshold amounts) in the case of individuals, trusts or estates, regardless of the U.S. stockholder’s holding period for his, her or its common
stock and regardless of whether paid in cash or reinvested in additional common stock. Distributions in excess of our earnings and profits first will reduce a U.S. stockholder’s adjusted
tax basis in such stockholder’s common stock and, after the adjusted basis is reduced to zero, will constitute capital gains to such U.S. stockholder. Stockholders receiving dividends or
distributions in the form of additional shares of our common stock purchased in the market should be treated for U.S. federal income tax purposes as receiving a distribution in an
amount equal to the amount of money that the stockholders receiving cash dividends or distributions will receive, and should have a cost basis in the shares received equal to such
amount. Stockholders receiving dividends in newly issued shares of our common stock will be treated as receiving a distribution equal to the value of the shares received, and should
have a cost basis of such amount.
Although we currently intend to distribute any net capital gains at least annually, we can in the future decide to retain some or all of our net capital gains but designate the retained
amount as a “deemed distribution.” In that case, among other consequences, we will pay tax on the retained amount, each U.S. stockholder will be required to include their share of the
deemed distribution in income as if it had been distributed to the U.S. stockholder, and the U.S. stockholder will be entitled to claim a credit equal to their allocable share of the tax paid
on the deemed distribution by us. The amount of the deemed distribution net of such tax will be added to the U.S. stockholder’s tax basis for their common stock. Since we expect to
pay tax on any retained net capital gains at our regular
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corporate tax rate, and since that rate is in excess of the maximum rate currently payable by individuals on long-term capital gains, the amount of tax that individual stockholders will be
treated as having paid and for which they will receive a credit will exceed the tax they owe on the retained net capital gain. Such excess generally could be claimed as a credit against
the U.S. stockholder’s other U.S. federal income tax obligations or could be refunded to the extent it exceeds a stockholder’s liability for U.S. federal income tax. A stockholder that is
not subject to U.S. federal income tax or otherwise required to file a U.S. federal income tax return would be required to file a U.S. federal income tax return on the appropriate form in
order to claim a refund for the taxes we paid. In order to utilize the deemed distribution approach, we must provide written notice to our stockholders prior to the expiration of 60 days
after the close of the relevant taxable year. We cannot treat any of our investment company taxable income as a “deemed distribution.”
For purposes of determining (1) whether the Annual Distribution Requirement is satisfied for any tax year and (2) the amount of capital gain dividends paid for that tax year, we could,
under certain circumstances, elect to treat a dividend that is paid during the following tax year as if it had been paid during the tax year in question. If we make such an election, the
U.S. stockholder will still be treated as receiving the dividend in the tax year in which the distribution is made. However, any dividend declared by us in October, November or
December of any calendar year, payable to stockholders of record on a specified date in such a month and actually paid during January of the following calendar year, will be treated as
if it had been received by our U.S. stockholders on December 31 of the calendar year in which the dividend was declared.
If an investor purchases shares of our common stock shortly before the record date of a distribution, the price of the shares of our common stock will include the value of the distribution
and the investor will be subject to tax on the distribution even though it represents a return of their investment.
A U.S. stockholder generally will recognize taxable gain or loss if the stockholder sells or otherwise disposes of their shares of our common stock. Any gain or loss arising from such
sale or disposition generally will be treated as long-term capital gain or loss if the stockholder has held their shares of common stock for more than one year. Otherwise, it would be
classified as short-term capital gain or loss. However, any capital loss arising from the sale or disposition of shares of our common stock held for six months or less will be treated as
long-term capital loss to the extent of the amount of capital gain dividends received, or undistributed capital gain deemed received, with respect to such shares. In addition, all or a
portion of any loss recognized upon a disposition of shares of our common stock could be disallowed if other shares of our common stock are purchased (whether through reinvestment
of distributions or otherwise) within 30 days before or after the disposition. In such a case, the basis of the common stock acquired will be increased to reflect the disallowed loss.
In general, individual U.S. stockholders are subject to a maximum U.S. federal income tax rate of either 15% or 20% (depending on whether the individual U.S. stockholder’s income
exceeds certain threshold amounts) on their net capital gain, i.e., the excess of realized net long-term capital gain over realized net short-term capital loss for a taxable year, including
a long-term capital gain derived from an investment in our shares of common stock. Such rate is lower than the maximum federal income tax rate on ordinary taxable income currently
payable by individuals. Corporate U.S. stockholders currently are subject to U.S. federal income tax on net capital gain at the maximum 21% rate also applied to ordinary income. Non-
corporate stockholders incurring net capital losses for a tax year (i.e., net capital losses in excess of net capital gains) generally can deduct up to $3,000 of such losses against their
ordinary income each tax year; any net capital losses of a non-corporate stockholder in excess of $3,000 generally could be carried forward and used in subsequent tax years as
provided in the Code. Corporate stockholders generally cannot deduct any net capital losses for a tax year, but can carry back such losses for three tax years or carry forward such
losses for five tax years.
We will send to each of our U.S. stockholders, as promptly as possible after the end of each calendar year, a notice detailing, on a per share and per distribution basis, the amounts
includible in such U.S. stockholder’s taxable income for such year as ordinary income and as long-term capital gain. In addition, the U.S. federal tax status of each calendar year’s
distributions generally will be reported to the IRS. Distributions can also be subject to additional state, local and foreign taxes depending on a U.S. stockholder’s particular situation.
Dividends distributed by us generally will not be eligible for the dividends-received deduction or the lower tax rates applicable to certain qualified dividends.
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Until and unless we are treated as a “publicly offered regulated investment company” (within the meaning of Section 67 of the Code) as a result of either (i) shares of our common stock
and our preferred stock collectively being held by at least 500 persons at all times during a taxable year or (ii) shares of our common stock being treated as regularly traded on an
established securities market for any taxable year, for purposes of computing the taxable income of U.S. stockholders that are individuals, trusts or estates, (i) our earnings will be
computed without taking into account such U.S. stockholders’ allocable shares of the management and incentive fees paid to our investment adviser and certain of our other expenses,
(ii) each such U.S. stockholder will be treated as having received or accrued a dividend from us in the amount of such U.S. stockholder’s allocable share of these fees and expenses for
such taxable year, (iii) each such U.S. stockholder will be treated as having paid or incurred such U.S. stockholder’s allocable share of these fees and expenses for the calendar year
and (iv) each such U.S. stockholder’s allocable share of these fees and expenses will be treated as miscellaneous itemized deductions by such U.S. stockholder. For taxable years
beginning before 2026, miscellaneous itemized deductions generally are not deductible by a U.S. stockholder that is an individual, trust or estate. For taxable years beginning in 2026 or
later, miscellaneous itemized deductions are deductible only to the extent that the aggregate of such U.S. stockholder’s miscellaneous itemized deductions exceeds 2% of such U.S.
stockholder’s adjusted gross income for U.S. federal income tax purposes, are not deductible for purposes of determining a U.S. stockholder’s liability for the U.S. federal alternative
minimum tax and are subject to the overall limitation on itemized deductions under Section 68 of the Code.
Backup withholding, currently at a rate of 24%, could be applicable to all taxable distributions to any non-corporate U.S. stockholder (1) who fails to furnish us with a correct taxpayer
identification number or a certificate that such stockholder is exempt from backup withholding or (2) with respect to whom the IRS notifies us that such stockholder has failed to properly
report certain interest and dividend income to the IRS and to respond to notices to that effect. An individual’s taxpayer identification number is his or her social security number. Any
amount withheld under backup withholding is not an additional tax and is generally allowed as a credit against the U.S. stockholder’s U.S. federal income tax liability and could entitle
such stockholder to a refund, provided that proper information is timely provided to the IRS.
If a U.S. stockholder recognizes a loss with respect to shares of our common stock of $2 million or more for an individual stockholder or $10 million or more for a corporate stockholder,
the stockholder must file with the IRS a disclosure statement on Form 8886. Direct stockholders of portfolio securities are in many cases exempted from this reporting requirement, but
under current guidance, stockholders of a RIC are not exempted. The fact that a loss is reportable under these regulations does not affect the legal determination of whether the
taxpayer’s treatment of the loss is proper. U.S. stockholders should consult their tax advisors to determine the applicability of these regulations in light of their specific circumstances.
An additional 3.8% Medicare tax is imposed on certain net investment income (including ordinary dividends and capital gain distributions received from us and net gains from
redemptions or other taxable dispositions of our shares) of U.S. individuals, estates and trusts to the extent that such person’s “modified adjusted gross income” (in the case of an
individual) or “adjusted gross income” (in the case of an estate or trust) exceeds certain threshold amounts.
Taxation of Non-U.S. Stockholders
Whether an investment in the shares of our common stock is appropriate for a Non-U.S. stockholder will depend upon that person’s particular circumstances. An investment in the
shares of our common stock by a Non-U.S. stockholder could have adverse tax consequences. Non-U.S. stockholders should consult their tax advisors before investing in our common
stock.
Subject to the discussion below, distributions of our “investment company taxable income” to Non-U.S. stockholders (including interest income, net short-term capital gain or foreign-
source dividend and interest income, which generally would be free of withholding if paid to Non-U.S. stockholders directly) will be subject to withholding of U.S. federal income tax at a
30% rate (or lower rate provided by an applicable treaty) to the extent of our current and accumulated earnings and profits unless the distributions are effectively connected with a U.S.
trade or business of the Non-U.S. stockholder, in which case the distributions will generally be subject to U.S. federal income tax at the rates applicable to U.S. persons. In that case,
we will not be required to withhold U.S. federal income tax if the Non-U.S. stockholder complies with applicable certification and disclosure requirements. Special certification
requirements apply to a Non-U.S. stockholder that is a foreign partnership or a foreign trust, and such entities are urged to consult their own tax advisors.
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Certain properly reported dividends received by a Non-U.S. stockholder generally are exempt from U.S. federal withholding tax when they (1) are paid in respect of our “qualified net
interest income” (generally, our U.S.-source interest income, other than certain contingent interest and interest from obligations of a corporation or partnership in which we or the non-
U.S. stockholder are at least a 10% stockholder, reduced by expenses that are allocable to such income), or (2) are paid in connection with our “qualified short-term capital gains”
(generally, the excess of our net short-term capital gain over our long-term capital loss for a tax year) as well as if certain other requirements are satisfied. Nevertheless, it should be
noted that in the case of shares of our stock held through an intermediary, the intermediary could have withheld U.S. federal income tax even if we reported the payment as an interest-
related dividend or short-term capital gain dividend. Moreover, depending on the circumstances, we could report all, some or none of our potentially eligible dividends as derived from
such qualified net interest income or as qualified short-term capital gains, or treat such dividends, in whole or in part, as ineligible for this exemption from withholding.
Actual or deemed distributions of our net capital gains to a Non-U.S. stockholder, and gains realized by a Non-U.S. stockholder upon the sale of our common stock, will not be subject
to federal withholding tax and generally will not be subject to U.S. federal income tax unless the distributions or gains, as the case could be, are effectively connected with a U.S. trade
or business of the Non-U.S. stockholder and, if an income tax treaty applies, are attributable to a permanent establishment maintained by the Non-U.S. stockholder in the United States
or, in the case of an individual Non-U.S. stockholder, the stockholder is present in the United States for 183 days or more during the year of the sale or capital gain dividend and certain
other conditions are met.
If we distribute our net capital gains in the form of deemed rather than actual distributions (which we could do in the future), a Non-U.S. stockholder will be entitled to a U.S. federal
income tax credit or tax refund equal to the stockholder’s allocable share of the tax we pay on the capital gains deemed to have been distributed. In order to obtain the refund, the Non-
U.S. stockholder must obtain a U.S. taxpayer identification number and file a U.S. federal income tax return even if the Non-U.S. stockholder would not otherwise be required to obtain
a U.S. taxpayer identification number or file a U.S. federal income tax return. For a corporate Non-U.S. stockholder, distributions (both actual and deemed), and gains realized upon the
sale of our common stock that are effectively connected with a U.S. trade or business could, under certain circumstances, be subject to an additional “branch profits tax” at a 30% rate
(or at a lower rate if provided for by an applicable treaty).
A Non-U.S. stockholder who is a non-resident alien individual, and who is otherwise subject to withholding of U.S. federal income tax, could be subject to information reporting and
backup withholding of U.S. federal income tax on dividends unless the Non-U.S. stockholder provides us or the dividend paying agent with a U.S. nonresident withholding tax
certification (e.g., an IRS Form W-8BEN, IRS Form W-8BEN-E, or an acceptable substitute form) or otherwise meets documentary evidence requirements for establishing that it is a
Non-U.S. stockholder or otherwise establishes an exemption from backup withholding.
Pursuant to the Foreign Account Tax Compliance Act, or FATCA, the applicable withholding agent is generally required to withhold U.S. tax (at a 30% rate) with respect to payments of
dividends made to certain non-U.S. entities that fail to comply (or be deemed compliant) with extensive reporting and withholding requirements designed to inform the U.S. Department
of the Treasury of U.S.-owned foreign investment accounts. The information required to be reported include the identity and taxpayer identification number of each account holder and
transaction activity within the holder’s account. Stockholders could be requested to provide additional information to enable the applicable withholding agent to determine whether
withholding is required.
An investment in shares by a non-U.S. person could also be subject to U.S. federal estate tax. Non-U.S. persons should consult their own tax advisors with respect to the U.S. federal
income tax, U.S. federal estate tax, withholding tax, and state, local and foreign tax consequences of acquiring, owning or disposing of our common stock.
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Item 1A. Risk Factors
You should carefully consider these risk factors, together with all of the other information included in this Annual Report on Form 10-K and the other reports and documents filed by us
with the SEC. The risks set out below are not the only risks we face. Additional risks and uncertainties not presently known to us or not presently deemed material by us could also
impair our operations and performance. If any of the following events occur, our business, financial condition, results of operations and cash flows could be materially and adversely
affected. In such case, our net asset value and the trading price of our common stock could decline, and you could lose all or part of your investment. The risk factors described below
are the principal risk factors associated with an investment in us as well as those factors generally associated with an investment company with investment objectives, investment
policies, capital structure or trading markets similar to ours.
Risks Relating to Our Business and Structure
We are subject to risks associated with the current interest rate environment and to the extent we use debt to finance our investments, changes in interest rates will affect
our cost of capital and net investment income.
To the extent we borrow money or issue debt securities or preferred stock to make investments, our net investment income will depend, in part, upon the difference between the rate at
which we borrow funds or pay interest or dividends on such debt securities or preferred stock and the rate at which we invest these funds. In addition, many of our debt investments and
borrowings have floating interest rates that reset on a periodic basis, and many of our investments are subject to interest rate floors. As a result, a change in market interest rates could
have a material adverse effect on our net investment income. In periods of rising interest rates, our cost of funds will increase because the interest rates on the amounts borrowed
under our credit facilities or certain other financing arrangements are typically floating, which could reduce our net investment income to the extent any debt investments have fixed
interest rates, and the interest rate on investments with an interest rate floor above current levels will not increase until interest rates exceed the applicable floor.
We can use interest rate risk management techniques in an effort to limit our exposure to interest rate fluctuations. Such techniques could include various interest rate hedging activities
to the extent permitted by the 1940 Act and applicable commodities laws. These activities could limit our ability to participate in the benefits of lower interest rates with respect to the
hedged borrowings. Adverse developments resulting from changes in interest rates or hedging transactions could have a material adverse effect on our business, financial condition
and results of operations.
You should also be aware that a rise in the general level of interest rates typically will lead to higher interest rates applicable to our debt investments, which could result in an increase
of the amount of incentive fees payable to GC Advisors. In addition, a decline in the prices of the debt we own could adversely affect our net asset value. Also, an increase in interest
rates available to investors could make an investment in our common stock less attractive if we are not able to increase our distribution rate, which could reduce the value of our
common stock.
We operate in a highly competitive market for investment opportunities, which could reduce returns and result in losses.
A number of entities compete with us to make the types of investments that we plan to make, and we believe that recent market trends, including sustained periods of low interest rates,
have increased the number of competitors seeking to invest in loans to private, middle-market companies in the United States. We compete with public and private funds, commercial
and investment banks, commercial financing companies and, to the extent they provide an alternative form of financing, private equity and hedge funds. Many of our competitors are
substantially larger and have considerably greater financial, technical and marketing resources than we do. For example, we believe some of our competitors could have access to
funding sources that are not available to us. In addition, some of our competitors could have higher risk tolerances or different risk assessments, which could allow them to consider a
wider variety of investments and establish more relationships than us. Furthermore, many of our competitors are not subject to the regulatory restrictions that the 1940 Act imposes on
us as a business development company or the source of income, asset diversification and distribution requirements we must satisfy to maintain our qualification as a RIC. The
competitive pressures we face could have a material adverse effect on our business, financial condition, results of operations and cash flows. As a result of this competition, we can
provide no assurance that we will be able to take advantage of attractive investment opportunities that arise from time to time, and we can provide no assurance that we will be able to
identify and make investments that are consistent with our investment objective.
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An excess of the amount of capital in the private debt markets and overall competition for loans could result in short term returns for us that are lower than our long-term targets. In the
event these conditions continue for an extended amount of time, they could have a material adverse effect on our business, financial condition and results of operations.
Identifying, structuring and consummating investments involves competition among capital providers and market and transaction uncertainty. GC Advisors can provide no assurance
that it will be able to identify a sufficient number of suitable investment opportunities or to avoid prepayment of existing investments to satisfy our investment objectives, including as
necessary to effectively structure credit facilities or other forms of leverage.
The loan origination market is very competitive, which can result in loan terms that are more favorable to borrowers, and conversely less favorable to lenders, such as lower interest
rates and fees, weaker borrower financial and other covenants, borrower rights to cure defaults, and other terms more favorable to borrowers than current or historical norms. Increased
competition could cause us to make more loans that are “cov-lite” in nature and, in a distressed scenario, there can be no assurance that these loans will retain the same value as
loans with a full package of covenants. As a result of these conditions, the market for leveraged loans could become less advantageous than expected for us, and this could increase
default rates, decrease recovery rates or otherwise harm our returns. The risk of prepayment is also higher in the current competitive environment if borrowers are offered more
favorable terms by other lenders. The financial markets have experienced substantial fluctuations in prices and liquidity for leveraged loans. Any further disruption in the credit and
other financial markets could have substantial negative effects on general economic conditions, the availability of required capital for companies and the operating performance of such
companies. These conditions also could result in increased default rates and credit downgrades, and affect the liquidity and pricing of the investments made by us. Conversely, periods
of economic stability and increased competition among capital providers could increase the difficulty of locating investments that are desirable for us.
With respect to the investments we make, we do not seek to compete based primarily on the interest rates we offer, and we believe that some of our competitors could make loans with
interest rates that will be lower than the rates we offer. In the secondary market for acquiring existing loans, we compete generally on the basis of pricing terms. With respect to all
investments, we could lose some investment opportunities if we do not match our competitors’ pricing, terms and structure. However, if we match our competitors’ pricing, terms and
structure, we could experience decreased net interest income, lower yields and increased risk of credit loss. We will also compete for investment opportunities with accounts managed
or sponsored by GC Advisors or its affiliates. Although GC Advisors allocates opportunities in accordance with its allocation policy, allocations to such other accounts will reduce the
amount and frequency of opportunities available to us and thus not necessarily be in the best interests of us and our securityholders. Moreover, the performance of investments will not
be known at the time of allocation.
Rising interest rates could affect the value of our investments and make it more difficult for portfolio companies to make periodic payments on their loans.
Interest rate risk refers to the risk of market changes in interest rates. Interest rate changes affect the value of debt. In general, rising interest rates will negatively impact the price of
fixed rate debt, and falling interest rates will have a positive effect on price. Adjustable rate debt also reacts to interest rate changes in a similar manner, although generally to a lesser
degree. Interest rate sensitivity is generally larger and less predictable in debt with uncertain payment or prepayment schedules. Further, rising interest rates make it more difficult for
borrowers to repay debt, which could increase the risk of payment defaults. Any failure of one or more portfolio companies to repay or refinance its debt at or prior to maturity or the
inability of one or more portfolio companies to make ongoing payments following an increase in contractual interest rates could have a material adverse effect on our business, financial
condition, results of operations and cash flows.
We are subject to risks associated with the transition away from LIBOR.
Following their publication on June 30, 2023, no settings of the London Interbank Offered Rate (“LIBOR”) continue to be published on a representative basis and publication of many
non-U.S. dollar LIBOR settings has been entirely discontinued. On July 29, 2021, the U.S. Federal Reserve System, in conjunction with the Alternative Reference Rates Committee, a
steering committee
comprised of large U.S. financial institutions, formally recommended replacing U.S.-dollar LIBOR with the Secured Overnight Financing Rate (“SOFR”), a new index calculated by
short-term repurchase agreements, backed by Treasury securities. In April 2018, the Bank of England began publishing its proposed alternative rate, the Sterling
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Overnight Index Average (“SONIA”). Each of SOFR and SONIA significantly differ from LIBOR, both in the actual rate and how it is calculated. Further, on March 15, 2022, the
Consolidation Appropriations Act of 2022, which includes the Adjustable Interest Rate (LIBOR) Act (“LIBOR Act”), was signed into law in the United States. This legislation establishes
a uniform benchmark replacement process for certain financial contracts that mature after June 30, 2023 that do not contain clearly defined or practicable LIBOR fallback provisions.
The legislation also creates a safe harbor that shields lenders from litigation if they choose to utilize a replacement rate recommended by the Board of Governors of the Federal
Reserve. In addition, the U.K. Financial Conduct Authority (“FCA”), which regulates the publisher of LIBOR (ICE Benchmark Administration) has announced that it will require the
continued publication of the one-, three- and six-month tenors of U.S.-dollar LIBOR on a non-representative synthetic basis until the end of September 2024, which may result in
certain non-U.S. law-governed contracts and U.S. law-governed contracts not covered by the federal legislation remaining on synthetic U.S.-dollar LIBOR until the end of this period.
Although the transition process away from LIBOR has become increasingly well-defined (e.g. the LIBOR Act now provides a uniform benchmark replacement for certain LIBOR-based
instruments in the United States), the transition process is complex and it could cause a disruption in the credit markets generally and could have adverse impacts on our business
financial condition and results of operations, including, among other things, increased volatility or illiquidity in markets for instruments that continue to rely on LIBOR or which have
been transitioned away from LIBOR to a different rate like SOFR and, in any case, could result in a reduction in the value of certain investments held by us.
We are dependent upon GC Advisors for our success and upon its access to the investment professionals and partners of Golub Capital and its affiliates.
We do not have any internal management capacity or employees. We rely on GC Advisors to manage and conduct our affairs and make all investment decisions. Subject to the
oversight of our board of directors, GC Advisors has sole discretion in originating, structuring, negotiating, purchasing, financing and eventually divesting our investments, and our
investors will not be able to evaluate for themselves the merits of particular investments prior to us making such investments. We depend on the diligence, skill and network of business
contacts of the senior investment professionals of GC Advisors to achieve our investment objective. GC Advisors’ investment committee, which consists of two members of our board of
directors and additional employees of Golub Capital LLC, provides oversight over our investment activities. We also cannot assure you that we will replicate the historical results
achieved by members of the investment committee, and we caution you that our investment returns could be substantially lower than the returns achieved by them in prior periods. We
expect that GC Advisors will evaluate, negotiate, structure, close and monitor our investments in accordance with the terms of the Investment Advisory Agreement. We can offer no
assurance, however, that the senior investment professionals of GC Advisors will continue to provide investment advice to us. If these individuals do not maintain their existing
relationships with Golub Capital LLC and its affiliates and do not develop new relationships with other sources of investment opportunities, we can provide no assurance that GC
Advisors or its affiliates will be able to identify appropriate replacements or grow our investment portfolio. The loss of any member of GC Advisors’ investment committee or of other
senior investment professionals of GC Advisors and its affiliates would limit our ability to achieve our investment objective and operate as we anticipate. This could have a material
adverse effect on our financial condition, results of operations and cash flows.
The Staffing Agreement provides that Golub Capital LLC makes available to GC Advisors experienced investment professionals and provides access to the senior investment
personnel of Golub Capital LLC for purposes of evaluating, negotiating, structuring, closing and monitoring our investments. We are not a party to the Staffing Agreement and cannot
assure you that Golub Capital LLC will fulfill its obligations under the agreement. If Golub Capital LLC fails to perform, we cannot assure you that GC Advisors will enforce the Staffing
Agreement, that such agreement will not be terminated by either party or that we will continue to have access to the investment professionals of Golub Capital LLC and its affiliates or
their information and deal flow.
Our business model depends to a significant extent upon strong referral relationships with sponsors and investing in companies backed by private equity sponsors. Any
inability of GC Advisors to maintain or develop these relationships, or the failure of these relationships to generate investment opportunities, could adversely affect our
business.
GC Advisors is highly dependent on relationships with private equity sponsors in connection with the sourcing of investments. If private equity sponsors find new sources of debt capital
that are more advantageous to them, or if GC Advisors suffers reputational harm such that it becomes a less attractive source of capital for private equity sponsors,
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GC Advisors could have difficulty finding and sourcing new middle-market debt investments. Private equity sponsors could experience financial distress, which could be related or
unrelated to the portfolio companies to which we have exposure. Once in financial distress, such sponsors likely would be unable to provide the same level of managerial, operating or
financial support to such portfolio companies, resulting in an increased risk of default or inability to repay remaining principal at maturity.
From time to time, we expect to have direct or indirect exposure to companies controlled by private equity sponsors in which the sponsors have completed one or more dividend
recapitalizations, thereby allowing the private equity sponsor to substantially reduce or eliminate its net investment in an underlying portfolio company. These investments generally
present different investment characteristics to us than investments where a private equity sponsor retains a significant net contributed capital position in the company. These
investments could experience a higher rate of default. Even when a default does not occur, private equity sponsors could be less willing to provide ongoing financial, managerial or
operating support to a portfolio company after it has received one or more capital distributions on its investment.
We believe that purchase price multiples of companies (as measured by the price paid by a private equity sponsor to purchase a company divided by the company’s trailing twelve-
month earnings) to which we have direct or indirect exposure are close to all-time highs. When considering the appropriate amount of financing to provide a prospective borrower, GC
Advisors considers the value cushion as measured by the difference between the enterprise value of the company and the total amount of financing. If market purchase price multiples
decline or if a portfolio company experiences financial distress, the value cushion supporting our investment could deteriorate and the investment could become impaired, resulting in
losses for us. The risk of such losses for us are greater during periods when purchase price multiples are close to all-time highs.
We can provide no assurance that we will be able to replicate the historical results achieved by other entities managed or sponsored by members of GC Advisors’
investment committee, or by GC Advisors or its affiliates.
Investors are cautioned that past investment performance of similar portfolios and other investment vehicles managed by GC Advisors or its affiliates is not indicative of how we will
perform. Our investments could differ from some existing accounts and funds that are or have been sponsored or managed by members of GC Advisors’ investment committee, GC
Advisors or affiliates of GC Advisors. Investors in our securities are not acquiring an interest in any accounts that are or have been sponsored or managed by members of GC Advisors’
investment committee, GC Advisors or affiliates of GC Advisors. We often co-invest in portfolio investments with other accounts sponsored or managed by members of GC Advisors’
investment committee, GC Advisors or its affiliates. Such investments are subject to regulatory limitations and approvals by directors who are not “interested persons,” as defined in the
1940 Act. We can offer no assurance, however, that we will obtain such approvals or develop opportunities that comply with such limitations. We also cannot assure you that we will
replicate the historical results achieved by us or by members of the investment committee, and we caution you that our investment returns could be substantially lower than the returns
achieved in prior periods. Additionally, all or a portion of the prior results were achieved in particular market conditions that might never be repeated. Moreover, current or future market
volatility and regulatory uncertainty can have an adverse impact on our future performance.
Our financial condition, results of operations and cash flows depend on our ability to manage our business effectively.
Our ability to achieve our investment objective depends on our ability to manage our business and to grow. This depends, in turn, on GC Advisors’ ability to identify, invest in and
monitor companies that meet our investment criteria. The achievement of our investment objectives on a cost-effective basis depends upon GC Advisors’ execution of our investment
process, its ability to provide competent, attentive and efficient services to us and, to a lesser extent, our access to financing on acceptable terms. GC Advisors has substantial
responsibilities under the
Investment Advisory Agreement, as well as responsibilities in connection with the management of other accounts sponsored or managed by GC Advisors, members of GC Advisors’
investment committee or the Administrator. The personnel of the Administrator and its affiliates could be called upon to provide managerial assistance to our portfolio companies.
These activities could distract them or slow our rate of investment. Any failure to manage our business and our future growth effectively could have a material adverse effect on our
business, financial condition, results of operations and cash flows.
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There are significant potential conflicts of interest as a result of our arrangements with GC Advisors and its affiliates and GC Advisors’ investment committee that could
affect our investment returns.
As a result of our arrangements with GC Advisors and its affiliates and GC Advisors’ investment committee, there will be times when GC Advisors or such persons have interests that
differ from those of our security holders, giving rise to a conflict of interest, many of which are described in the following risk factors. GC Advisors attempts to identify, monitor and
mitigate conflicts of interest. Further, GC Advisors has implemented policies and procedures reasonably designed to ensure its clients are treated fairly and equitably over time. GC
Advisors believes that these factors, together with Golub Capital’s commitment to put investors first, effectively mitigate the risks associated with such conflicts of interest. However, it
can be difficult to ensure that conflicts of interest do not adversely affect us.
There are conflicts related to the obligations of GC Advisors’ investment committee, GC Advisors or its affiliates have to other clients and conflicts related to fees and
expenses of such other clients.
The members of GC Advisors’ investment committee serve as officers, directors or principals of entities that operate in the same or a related line of business as we do or of accounts
sponsored or managed by GC Advisors or its affiliates. Currently, certain of our directors and certain of our officers also serve as directors and officers of GBDC 3, GDLC, GBDC 4,
GDLCU and GCRED, each a closed-end, non-diversified management investment company that has also elected to be regulated as a business development company under the 1940
Act. Similarly, GC Advisors and its affiliates manage other clients with similar or competing investment objectives.
GC Advisors’ management team will share its time and attention between us and other investment vehicles and accounts. Neither we nor any investor in us unaffiliated with GC
Advisors will have any rights in or to independent ventures of GC Advisors or its affiliates or in the income or profits derived therefrom. GC Advisors does not expect to have any
dedicated personnel who spend all or substantially all of their time managing our investing activities.
In serving in these multiple capacities, GC Advisors and its personnel have obligations to other clients or investors in those entities, the fulfillment of which could conflict with the best
interests of us or our stockholders. Economic disruption and uncertainty precipitated by certain events, including for example public health crises such as the COVID-19 pandemic,
could require GC Advisors and its affiliates to devote additional time and focus to existing portfolio companies in which other funds and accounts managed by GC Advisors and its
affiliates hold investments. The allocation of time and focus by personnel of GC Advisors and its affiliates to existing portfolio company investments held by other funds and accounts
could reduce the time that such individuals have to spend on our investing activities.
Our investment objective overlaps with the investment objectives of other affiliated accounts. For example, GC Advisors and its affiliates currently manage GBDC 3, GDLC, GBDC 4,
GDLCU, GCRED and multiple private funds and separate accounts that pursue an investment strategy similar to ours, some of which will seek additional capital from time to time. We
compete with these and other accounts sponsored or managed by GC Advisors and its affiliates for capital and investment opportunities. As a result, GC Advisors and its affiliates face
conflicts in the allocation of investment opportunities among us and other accounts advised by or affiliated with GC Advisors and, in certain circumstances, in the timing of the sale of an
investment. Certain of these accounts provide for higher management or incentive fees, allow GC Advisors to recover greater expense reimbursements or overhead allocations, and/or
permit GC Advisors and its affiliates to receive higher origination and other transaction fees, all of which could contribute to this conflict of interest and create an incentive for GC
Advisors to favor such other accounts. For example, the 1940 Act restricts GC Advisors from receiving more than a 1% fee in connection with loans that we acquire, or originate, a
limitation that does not exist for certain other accounts. GC Advisors seeks to allocate investment opportunities among eligible accounts in a manner that is fair and equitable over time
and consistent with its allocation policy. However, we can offer no assurance that such opportunities will be allocated to us fairly or equitably in the short-term or over time, and there
can be no assurance that we will be able to participate in all investment opportunities that are suitable to us. Furthermore, because allocations under GC Advisors’
allocation policy are based on total capital of the relevant investing funds, including us, we expect to receive smaller allocations relative to larger accounts, which could have a material
adverse effect on our business, financial condition, results of operations and cash flows during such ramp-up period. With respect to the sale of investments, the sale of an investment
by one account advised by GC Advisors or its affiliates could potentially adversely affect the market value of the interests in such investment that continue to be held by other accounts,
including us.
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GC Advisors’ investment committee, GC Advisors or its affiliates could, from time to time, possess material non-public information, limiting our investment discretion.
Principals of GC Advisors and its affiliates and members of GC Advisors’ investment committee could serve as directors of, or in a similar capacity with, companies in which we invest,
the securities of which are purchased or sold on our behalf. In the event that material non-public information is obtained with respect to such companies, or we become subject to
trading restrictions under the internal trading policies of those companies or as a result of applicable law or regulations, we could be prohibited for a period of time from purchasing or
selling the securities of such companies, and this prohibition could have an adverse effect on us.
Our management and incentive fee structure creates incentives for GC Advisors that are not fully aligned with the interests of our stockholders and could induce GC
Advisors to make certain investments, including speculative investments.
In the course of our investing activities, we pay management and incentive fees to GC Advisors. The management fee is based on our average adjusted gross assets and the incentive
fee is computed and paid on income and capital gains, both of which include leverage. As a result, investors in our common stock will invest on a “gross” basis and receive distributions
on a “net” basis after expenses, resulting in a lower rate of return than one could achieve through direct investments. Because these fees are based on the fair value of our average
adjusted gross assets, GC Advisors benefits when we incur debt or use leverage. The use of leverage increases the likelihood of default on our debt or other leverage, which would
disfavor our securityholders.
Additionally, the incentive fee payable by us to GC Advisors could create an incentive for GC Advisors to cause us to realize capital gains or losses that are not in the best interests of
us or our stockholders. Under the incentive fee structure, GC Advisors benefits when we recognize capital gains and, because GC Advisors determines when an investment is sold,
GC Advisors controls the timing of the recognition of such capital gains. Our board of directors is charged with protecting our stockholders’ interests by monitoring how GC Advisors
addresses these and other conflicts of interest associated with its management services and compensation.
The part of the management and incentive fees payable to GC Advisors that relates to our net investment income is computed and paid on income that includes interest income that has
been accrued but not yet received in cash, such as market discount, debt instruments with PIK interest, preferred stock with PIK dividends, zero coupon securities, and other deferred
interest instruments. This compensation arrangement creates an incentive for GC Advisors to make investments on our behalf that are riskier or more speculative, including debt
financings that provide for deferred interest, rather than current cash payments of interest. Under these investments, we accrue the interest over the life of the investment but do not
receive the cash income from the investment until the end of the term. Our net investment income used to calculate the income portion of our investment fee, however, includes accrued
interest. GC Advisors has an incentive to invest in deferred interest securities in circumstances where it would not have done so but for the opportunity to continue to earn the fees
even when the issuers of the deferred interest securities would not be able to make actual cash payments to us on such securities. This risk could be increased because GC Advisors
is not obligated to reimburse us for any fees received even if we subsequently incur losses or never receive in cash the deferred income that was previously accrued.
Our securities could be purchased by GC Advisors or its affiliates.
Affiliates of GC Advisors have purchased, and GC Advisors and its affiliates in the future expect to purchase, certain of our securities. The purchase of our securities, including shares
of our common stock, by GC Advisors and its affiliates could create certain risks. For example, GC Advisors and its affiliates could have an interest in disposing of our securities at a
date that differs from that of our other investors so as to recover their investment in such securities.
The valuation process for certain of our portfolio holdings creates a conflict of interest.
The majority of our portfolio investments are in the form of securities that are not publicly traded. As a result, our board of directors determines the fair value of these securities in good
faith.
Valuations of private investments and private companies require judgment, are inherently uncertain, often fluctuate and are frequently based on estimates. It is possible that
determinations of fair value will differ materially from the values that would have been used if an active market for these investments existed. If determinations regarding the fair value
of investments were materially higher than the values that were ultimately realized upon the sale of such investments, the returns to our investors would be adversely affected.
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In connection with that determination, investment professionals from GC Advisors will provide our board of directors with portfolio company valuations based upon the most recent
portfolio company financial statements available and projected financial results of each portfolio company. The participation of GC Advisors’ investment professionals in our valuation
process, and the indirect pecuniary interest in GC Advisors by Lawrence E. Golub and David B. Golub, results in a conflict of interest as GC Advisors’ management fee is based, in
part, on our average adjusted gross assets and our capital gain and subordinated liquidation incentive fees are based, in part, on unrealized gains and losses.
Conflicts related to other arrangements with GC Advisors or its affiliates.
We have entered into a license agreement with Golub Capital LLC, under which Golub Capital LLC has granted us a non-exclusive, royalty-free license to use the name “Golub
Capital.” See “Management Agreements — License Agreement.” In addition, we pay to the Administrator our allocable portion of overhead and other expenses incurred by the
Administrator in performing its obligations under the Administration Agreement, such as rent and our allocable portion of the cost of our chief financial officer and chief compliance
officer and their respective staffs. These arrangements create conflicts of interest, including in the allocation of expenses and the enforcement of the respective agreements, that our
board of directors must monitor.
Our ability to enter into transactions with our affiliates will be restricted, which could limit the scope of investments available to us.
We are prohibited under the 1940 Act from participating in certain transactions with our affiliates without the prior approval of our independent directors and, in some cases, the SEC.
Any person that owns, directly or indirectly, five percent or more of our outstanding voting securities is our affiliate for purposes of the 1940 Act, and we are generally prohibited from
buying or selling any security from or to such affiliate, absent the prior approval of our independent directors. GC Advisors and its affiliates are considered our affiliates for such
purposes. The 1940 Act also prohibits certain “joint” transactions with certain of our affiliates, which could include investments in the same portfolio company, without prior approval of
our independent directors and, in some cases, the SEC. We are prohibited from buying or selling any security from or to, among others, any person who owns more than 25% of our
voting securities or certain of that person’s affiliates, or entering into prohibited joint transactions with such persons, absent the prior approval of the SEC.
We can, however, invest alongside GC Advisors’ and its affiliates’ other clients in certain circumstances where doing so is consistent with applicable law, SEC staff, or Staff,
interpretations and any co-investment exemptive relief order from the SEC. For example, we can invest alongside such accounts consistent with guidance promulgated by the Staff
permitting us and such other accounts to purchase interests in a single class of privately placed securities so long as certain conditions are met, including that GC Advisors, acting on
our behalf and on behalf of its other clients, negotiates no term other than price. We can also invest alongside GC Advisors’ other clients as otherwise permissible under regulatory
guidance, applicable regulations and GC Advisors’ allocation policy. Under this allocation policy, GC Advisors will determine the amount of any proposed investment to be made by us
and similar eligible accounts. We expect that these determinations will be made similarly for other accounts sponsored or managed by GC Advisors and its affiliates. If sufficient
securities or loan amounts are available to satisfy our and each such account’s proposed investment, the opportunity will be allocated in accordance with GC Advisors’ pre-transaction
determination. Where there is an insufficient amount of an investment opportunity to fully satisfy us and other accounts sponsored or managed by GC Advisors or its affiliates, the
allocation policy further provides that allocations among us and other accounts will generally be made pro rata based on the relative capital available for investment of each of us and
such other eligible accounts, subject to minimum and maximum investment size limits. In situations in which co-investment with other entities sponsored or managed by GC Advisors or
its affiliates is not permitted or appropriate, GC Advisors will need to decide whether we or such other entity or entities will proceed with the investment. GC Advisors will make these
determinations based on its policies and procedures, which generally require that such opportunities be offered to eligible accounts on a basis that will be fair and equitable over time,
including, for example, through random or rotational methods. However, we can offer no assurance that investment opportunities will be allocated to us fairly or equitably in the short-
term or over time.
On occasion, an investment opportunity will be too large to satisfy our desired position size and that of other investment funds and accounts managed by GC Advisors and its affiliates.
GC Advisors can provide no assurance that it will be able to identify counterparties to participate in such investment opportunities, and could be required to decline to make investments
where it does not believe that it can successfully sell some of the investment opportunity to another market participant.
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In situations in which co-investment with other accounts sponsored or managed by GC Advisors or its affiliates is not permitted or appropriate, such as when, in the absence of the
exemptive relief described below, we and such other accounts cannot make investments in the same issuer or where the different investments could be expected to result in a conflict
between our interest and those of other accounts, GC Advisors needs to decide whether we or such other accounts will proceed with such investments. GC Advisors makes these
determinations based on its policies and procedures, which generally require that such investment opportunities be offered to eligible accounts on a basis that is fair and equitable over
time, including, for example, through random or rotational methods. Moreover, we generally will be unable to invest in an issuer in which an account sponsored or managed by GC
Advisors or its affiliates has previously invested. Similar restrictions limit our ability to transact business with our officers or directors or their affiliates. These restrictions limit the scope
of investment opportunities that would otherwise be available to us.
We, GC Advisors and certain other funds and accounts sponsored or managed by GC Advisors and its affiliates, have received exemptive relief from the SEC to permit greater
flexibility to negotiate the terms of co-investments if our board of directors determines that it would be advantageous for us to co-invest with other accounts sponsored or managed by
GC Advisors or its affiliates in a manner consistent with our investment objectives, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent
factors. Under the terms of this exemptive relief, a “required majority” (as defined in Section 57(o) of the 1940 Act) of our independent directors is required to make certain conclusions
in connection with a co-investment transaction, including that (1) the terms of the proposed transaction are reasonable and fair to us and our stockholders and do not involve
overreaching of us or our stockholders on the part of any person concerned and (2) the transaction is consistent with the interests of our stockholders and is consistent with our
investment strategies and policies. We believe that co-investment by us and accounts sponsored or managed by GC Advisors and its affiliates will afford us additional investment
opportunities and the ability to achieve greater diversification. There could be many follow-on opportunities available to other entities advised by GC Advisors and its affiliates that are
unavailable to us due to the limitations of the exemptive relief granted to GC Advisors and its affiliates.
Although the terms of the exemptive relief require that GC Advisors will be given the opportunity to cause us to participate in certain transactions originated by affiliates of GC Advisors,
GC Advisors could determine that we not participate in those transactions and for certain other transactions (as set forth in certain criteria approved by our board of directors) GC
Advisors may not have the opportunity to cause us to participate. In addition, even if we and any such other entities sponsored or managed by GC Advisors or its affiliates invest in the
same securities or loans, conflicts of interest could still arise. For example, it is possible that, as a result of legal, tax, regulatory, accounting, political or other considerations, the terms
of such investment (and divestment thereof) (including with respect to price and timing) for us and such other entities advised by GC Advisors and its affiliates could differ. Additionally,
we and such other entities advised by GC Advisors and its affiliates will generally have different investment periods and/or investment objectives (including return profiles) and, as a
result, have conflicting goals with respect to the price and timing of disposition opportunities. As such, to the extent permissible under applicable law and any applicable order issued by
the SEC, we and such other entities could dispose of co-investments at different times and on different terms.
We have entered into the Adviser Revolver resulting in a conflict of interest between GC Advisors’ obligation to act in its own best interest and in our best interest.
We have entered into the Adviser Revolver, an unsecured revolving loan agreement with GC Advisors. GC Advisors has a conflict of interest between its obligation to act in our best
interest and its own best interest. Any such loans or advances made to us under the Adviser Revolver will be consistent with applicable law, GC Advisors’ fiduciary obligations to act in
our best interests, our investment objectives, and the asset coverage ratio requirements under the 1940 Act. The terms associated with any such loans from GC Advisors or its
affiliates, including the interest charged, shall, in the aggregate, be no more favorable to GC Advisors or its affiliates than could be obtained in an arm’s length transaction but will not
necessarily be on the same terms or at the same interest rate charged by GC Advisors to other funds that it manages. Neither GC Advisors nor any of its affiliates is obligated to extend
any such loans to us and such loans will not necessarily be made available to us in the same amounts or on the same economic terms as are made available to other funds advised by
GC Advisors or its affiliates, or at all. In the event that we are required to find third-party financing in place of or in addition to loans from GC Advisors and its affiliates, such third-party
financing could be at less favorable economic terms than the loans from GC Advisors and its affiliates, which could reduce our returns.
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GC Advisors could make certain investment decisions for the purpose of receiving transaction fees.
In connection with investments made by us, GC Advisors and its affiliates often receive origination, commitment, documentation, structuring, facility, monitoring, amendment,
refinancing, administrative agent and/or other fees from portfolio investments in which we invest or propose to invest. The potential for GC Advisors and its affiliates to receive such
economic benefits creates conflicts of interest as GC Advisors and its affiliates have an incentive to invest in portfolio investments that provide such benefits. Similarly, GC Advisors and
its affiliates could be incentivized to waive certain fees in connection with a refinancing in order to receive certain fees in the new transaction, including when we and/or other accounts
advised by GC Advisors and its affiliates can participate in the original or refinanced investment, or both.
Reductions, waivers or absorptions of fees and costs can temporarily result in higher returns to investors than they would otherwise receive if full fees and costs were
charged.
GC Advisors and its affiliates are permitted to reduce, waive or absorb some of the fees or costs otherwise due by us. While this activity can be seen as friendly to investors, reductions,
waivers and absorptions of fees and costs result in higher returns to investors than such investors would receive if full fees and costs were charged. There is no guarantee that any
reductions, waivers or absorptions will occur in the future, and any reductions, waivers and absorptions are entirely at the discretion of GC Advisors or the Administrator, as applicable.
GC Advisors could prioritize its relationship with a borrower or private equity sponsor instead of seeking the most advantageous terms for our investments.
GC Advisors will not make any investment on behalf of us that it does not believe to be in our best interest. However, conflicts can arise in any particular transaction between obtaining
the most advantageous terms for an investment, which benefits us and other clients of GC Advisors participating in that investment, and maintaining GC Advisors’ relationship with a
borrower or private equity sponsor, which likely serves the long-term best interests of GC Advisors’ clients overall, including us. For example, affiliates of GC Advisors hold relatively
small, minority investments in unaffiliated private equity funds, which arguably creates an incentive for GC Advisors to cause us to invest in portfolio companies owned by such private
equity funds and to treat such portfolio companies more favorably in a workout situation. As another example of the conflicts that could arise, GC Advisors is permitted to reduce or
waive transaction or prepayment fees, offer loan terms that are more favorable to the borrower (and conversely, less favorable to us), accept a below target position size, agree to
amend certain terms or waive existing terms or defaults or make other similar concessions to maintain or improve a relationship with a private equity sponsor or borrower, which GC
Advisors believes will increase the likelihood of repeat business that will benefit us and GC Advisors’ other clients.
GC Advisors operates in multiple business lines and could pursue additional business lines, which could create a conflict of interest in the allocation of its time and
focus.
While Golub Capital maintains two major business lines, it has explored and will continue to explore opportunities outside these business lines. Such activity could adversely affect us.
These risks include reputational damage, loss of management attention and time due to multiple constraints, regulatory sanctions, adverse impact to business relationships, increased
competition of capital allocations, and expansion of potential risks to GC Advisors’ business as a whole outside those previously disclosed. New business lines could also exacerbate
existing conflicts of interest and raise new conflicts.
Investors should be aware that other lines of business at Golub Capital could indirectly affect their investment in us, even if we are not directly exposed to those lines of business. While
GC Advisors and its affiliates keep each investment client as a legally distinct entity or account, there are risks that a separate business line suffering a material adverse condition could
affect other business lines to which we have direct exposure,
and consequently, our performance. These risks could materially affect GC Advisors’ business as a whole, and include loss of reputation, loss of management time and focus,
regulatory sanctions, and adverse impact to business relationships.
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Golub Capital could pursue strategic transactions, which could create a conflict of interest in the allocation of
GC Advisors’ time and focus.
Golub Capital could engage in any number of strategic transactions, including acquisitions, divestitures, joint ventures, new business formations, restructurings, launches of new
investment fund strategies and structures or even a fund that pursues a strategy that is different than what Golub Capital has historically focused on, such as a private equity fund of
funds. Additionally, Golub Capital could sell stakes in itself or in its affiliates or acquire stakes in other asset managers, service providers or investment vehicles, including to or from
investors in Golub Capital BDC. In August 2018, Golub Capital sold a passive, non-voting minority stake in its management companies. While Golub Capital has not subsequently
engaged in any material strategic transactions, it could do so in the future.
Strategic transactions are subject to many risks, such as the risk that the transaction might not be successful in meeting its strategic goals, or the risk that the transaction might divert
the attention of GC Advisors from our core investment activities, or the risk that the management team will not be successful in developing and operating the underlying business
involved in the strategic transaction.
We and GC Advisors could be the target of litigation or regulatory investigations.
We as well as GC Advisors and its affiliates participate in a highly regulated industry and are each subject to regulatory examinations in the ordinary course of business. There can be
no assurance that we and GC Advisors and/or any of its affiliates will avoid regulatory investigation and possible enforcement actions stemming therefrom. GC Advisors is a registered
investment adviser and, as such, is subject to the provisions of the Investment Advisers Act. We and GC Advisors are each, from time to time, subject to formal and informal
examinations, investigations, inquiries, audits and reviews from numerous regulatory authorities both in response to issues and questions raised in such examinations or investigations
and in connection with the changing priorities of the applicable regulatory authorities across the market in general.
There is also a material risk that applicable governmental authorities and regulators in the United States and other jurisdictions will continue to adopt new laws or regulations (such as
tax, privacy and anti-money laundering laws or regulations), or change existing laws or regulations, or enhance the interpretation or enforcement of existing laws and regulations, in
each case in a manner that is burdensome for GC Advisors and for us. Any such events or changes could occur during the term of Golub Capital BDC and could adversely affect us or
GC Advisors and GC Advisors’ ability to operate and/or pursue its management strategies on behalf of us. Further, any such events or changes could adversely affect obligors’ ability to
make payments on loans to which we are directly or indirectly exposed or otherwise adversely affect the value of such investments. Such risks are often difficult or impossible to predict,
avoid or mitigate in advance. As a result, there can be no assurance that any of the foregoing will not have an adverse impact on the business of GC Advisors and/or any of its affiliates
or our performance. From time to time, GC Advisors and its affiliates could take certain actions that they determine are necessary, appropriate or in the best interests of us and our
stockholders, taken as a whole, to mitigate the application or impact of certain laws or regulations.
GC Advisors, its affiliates and/or any of their respective principals and employees could also be named as defendants in, or otherwise become involved in, litigation. Litigation and
regulatory actions can be time-consuming and expensive and can lead to unexpected losses, which expenses and losses are often subject to indemnification by us. Legal proceedings
could continue without resolution for long periods of time and their outcomes, which could materially and adversely affect the value of us or the ability of GC Advisors to manage us, are
often impossible to anticipate. GC Advisors would likely be required to expend significant resources responding to any litigation or regulatory action related to it, and these actions could
be a distraction to the activities of GC Advisors.
Our investment activities are subject to the normal risks of becoming involved in litigation by third parties. This risk would be somewhat greater if we were to exercise control or
significant influence over a portfolio company’s direction. The expense of defending against claims by third parties and paying any amounts pursuant to settlements or judgments
would, absent willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved by GC Advisors, the Administrator, or any of our officers, be borne by us and
would reduce our net assets. GC Advisors and others are indemnified by us in connection with such litigation, subject to certain conditions.
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We will be subject to corporate-level income tax if we are unable to qualify as a RIC.
In order to qualify as a RIC under the Code, we must meet certain source-of-income, asset diversification and distribution requirements. The distribution requirement for a RIC is
satisfied if we distribute to our stockholders dividends for U.S. federal income tax purposes of an amount generally at least equal to 90% of our investment company taxable income,
which is generally our net ordinary income plus the excess of our net short-term capital gains in excess of our net long-term capital losses, determined without regard to any deduction
for dividends paid, to our stockholders each taxable year. We are subject, to the extent we use debt financing, to certain asset coverage ratio requirements under the 1940 Act and
financial covenants under loan and credit agreements that could, under certain circumstances, restrict us from making distributions necessary to qualify as a RIC. If we are unable to
obtain cash from other sources, we could fail to qualify as a RIC and, thus, could be subject to corporate-level income tax irrespective of the level of distributions paid to our
stockholders. To qualify as a RIC, we must also meet certain asset diversification requirements at the end of each quarter of our taxable year. Failure to meet these requirements could
result in our having to dispose of certain investments quickly in order to prevent the loss of our qualification as a RIC. Because most of our investments are in private or thinly traded
public companies, any such dispositions could be made at disadvantageous prices and could result in substantial losses. If we fail to qualify as a RIC for any reason and become
subject to corporate-level income tax, the resulting corporate taxes could substantially reduce our net assets, the amount of income available for distributions to stockholders and the
amount of our distributions and the amount of funds available for new investments. Such a failure would have a material adverse effect on us and our securityholders. See
“Business — Taxation as a RIC.”
We could need to raise additional capital to grow because we must distribute most of our income.
We could need additional capital to fund new investments and grow our portfolio of investments. We intend to access the capital markets periodically to issue debt or equity securities or
borrow from financial institutions in order to obtain such additional capital. Unfavorable economic conditions 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. A reduction in the availability of new capital could limit our ability to grow. In addition, in order to qualify as a RIC, we are
required to distribute each taxable year an amount generally at least equal to 90% of the sum of our net ordinary income and net short-term capital gains in excess of net long-term
capital losses, or investment company taxable income, determined without regard to any deduction for dividends paid as dividends for U.S. federal income tax purposes, to our
stockholders. As a result, these earnings are not available to fund new investments. An inability to access the capital markets successfully could limit our ability to grow our business
and execute our business strategy fully and could decrease our earnings, if any, which could have an adverse effect on the value of our securities. Furthermore, to the extent we are
not able to raise capital and are at or near our targeted leverage ratios, we could receive smaller allocations, if any, on new investment opportunities under GC Advisors’ allocation
policy and have, in the past, received such smaller allocations under similar circumstances.
We could have difficulty paying our required distributions if we recognize income before, or without, receiving cash representing such income.
For U.S. federal income tax purposes, we include in income certain amounts that we have not yet received in cash, such as the accretion of original issue discount. This could arise if
we receive warrants in connection with the making of a loan and in other circumstances, or through contracted PIK interest, which represents contractual interest added to the loan
balance and due at the end of the loan term. Such original issue discount, which could be significant relative to our overall investment activities, or increases in loan balances as a result
of contractual PIK arrangements, is included in income before we receive any corresponding cash payments. We also could be required to include in income certain other amounts that
we do not receive in cash.
That part of the incentive fee payable by us that relates to our net investment income is computed and paid on income that includes interest that has been accrued but not yet received
in cash, such as market discount, debt instruments with PIK interest, preferred stock with PIK dividends and zero coupon securities. It is possible that accrued interest or other income
previously used in the calculation of the incentive fee will become uncollectible, and GC Advisors has no obligation to refund any fees it received in respect of such accrued income.
Since in certain cases we could recognize income before or without receiving cash representing such income, we could have difficulty meeting the requirement to distribute dividends
for U.S. federal income tax purposes of an
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amount generally at least equal to 90% of our investment company taxable income, determined without regard to any deduction for dividends paid, to our stockholders in order to
maintain our qualification as a RIC.
In such a case, we could have to sell some of our investments at times we would not consider advantageous, raise additional debt or equity capital or reduce new investment
originations to meet these distribution requirements. If we are not able to obtain such cash from other sources, we could fail to qualify as a RIC and thus be subject to corporate-level
income tax. See “Business — Taxation as a RIC.”
The tax treatment of a non-U.S. stockholder in its jurisdiction of tax residence will depend entirely on the laws of such jurisdiction and could vary considerably from
jurisdiction to jurisdiction.
Depending on (1) the laws of such non-U.S. stockholder’s jurisdiction of tax residence, (2) how we are treated in such jurisdiction, and (3) our activities, an investment in us could result
in such non-U.S. stockholder recognizing adverse tax consequences in its jurisdiction of tax residence, including with respect to any generally required or additional tax filings and/or
additional disclosure required in such filings in relation to the treatment for tax purposes in the relevant jurisdiction of an interest in us and/or of distributions from us and any
uncertainties arising in that respect (Golub Capital BDC not being established under the laws of the relevant jurisdiction), the possibility of taxable income significantly in excess of cash
distributed to a non-U.S. stockholder, and possibly in excess of our actual economic income, the possibilities of losing deductions or the ability to utilize tax basis and of sums invested
being returned in the form of taxable income or gains, and the possibility of being subject to tax at unfavorable tax rates. A non-U.S. stockholder could also be subject to restrictions on
the use of its share of our deductions and losses in its jurisdiction of tax residence. Each stockholder is urged to consult its own tax advisers with respect to the tax and tax filing
consequences, if any, in its jurisdiction of tax residence of an investment in us, as well as any other jurisdiction in which such prospective investor is subject to taxation.
Regulations governing our operation as a business development company affect our ability to, and the way in which we, raise additional capital. As a business
development company, the necessity of raising additional capital exposes us to risks, including the typical risks associated with leverage.
We could issue debt securities or preferred stock and/or borrow money from banks or other financial institutions, which we refer to collectively as “senior securities,” up to the maximum
amount permitted by the 1940 Act. Under the current provisions of the 1940 Act, we are permitted as a business development company to issue senior securities in amounts such that
our asset coverage, as defined in the 1940 Act, equals the percentage of gross assets less all liabilities and indebtedness not represented by senior securities after each issuance of
senior securities that is applicable to us under Section 61 of the 1940 Act. Following the approval of our stockholders of the reduced asset coverage requirements in Section 61(a)(2) of
the 1940 Act and subject to our compliance with certain disclosure requirements, effective as of February 6, 2019, under the provisions of the 1940 Act, we are permitted as a business
development company to issue senior securities in amounts such that its asset coverage, as defined in the 1940 Act, equals at least 150% of gross assets less all liabilities and
indebtedness not represented by senior securities, after each issuance of senior securities. Under the reduced 150% asset coverage requirement, we are permitted under the 1940 Act
to have a ratio of total consolidated assets to outstanding indebtedness of 2:1 as compared to a maximum of 1:1 under the 200% asset coverage requirement that would otherwise
apply to a business development company. If the value of our assets declines, we could be unable to satisfy this ratio. If that happens, we could be required to sell a portion of our
investments and, depending on the nature of our leverage, repay a portion of our indebtedness at a time when such activities could be disadvantageous. This could have a material
adverse effect on our operations, and we may not be able to make distributions in an amount sufficient to be subject to tax as a RIC, or at all. Also, any amounts that we use to service
our indebtedness would not be available for distributions to our common stockholders. If we issue senior securities, we will be exposed to typical risks associated with leverage,
including an increased risk of loss. As of September 30, 2023, we had $3.1 billion of outstanding borrowings, including $388.7 million and $513.5 million outstanding under the 2018
Debt Securitization and the GCIC 2018 Debt Securitization, respectively.
In the absence of an event of default, no person or entity from which we borrow money has a veto right or voting power over our ability to set policy, make investment decisions or
adopt investment strategies. If we issue preferred stock, which is another form of leverage, the preferred stock would rank “senior” to common stock in our capital structure, preferred
stockholders would have separate voting rights on certain matters and could have other rights, preferences or privileges more favorable than those of our common stockholders, and
the issuance of preferred stock could have the effect of delaying, deferring or preventing a transaction or a change of control that could involve a premium price for holders of our
common stock or otherwise be in the best interest of our common stockholders.
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Holders of our common stock will directly or indirectly bear all of the costs associated with offering and servicing any preferred stock that we issue. In addition, any interests of
preferred stockholders would not necessarily
align with the interests of holders of our common stock and the rights of holders of shares of preferred stock to receive distributions would be senior to those of holders of shares of our
common stock. We do not, however, anticipate issuing preferred stock in the next 12 months.
We are not generally able to issue and sell our common stock at a price below net asset value per share. We could, however, sell our common stock, or warrants, options or rights to
acquire our common stock, at a price below the then-current net asset value per share of our common stock if our board of directors determines that such sale is in the best interests of
us and our stockholders, and, in certain cases, if our stockholders approve such sale. In any such case, the price at which our securities are to be issued and sold cannot be less than
a price that, in the determination of our board of directors, closely approximates the market value of such securities (less any distributing commission or discount). If we raise additional
funds by issuing common stock or securities convertible into, or exchangeable for, our common stock, then the percentage ownership of our stockholders at that time would decrease,
and holders of our common stock could experience dilution.
We finance our investments with borrowed money, which will accelerate and increase the potential for gain or loss on amounts invested and could increase the risk of
investing in us.
The use of leverage accelerates and increases 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. The amount of leverage that we employ will depend on GC Advisors’ and our board of directors’ assessment of market
and other factors at the time of any proposed borrowing. While we intend to target a leverage ratio of 0.85x to 1.25x debt-to-equity, this limitation will not prevent us from incurring
additional leverage or otherwise exceeding such leverage ratio to the full extent permissible under the 1940 Act, including during periods when we are experiencing unusual market
volatility or other unexpected conditions.
We cannot assure you that we will be able to obtain credit at all or on terms acceptable to us. While leverage presents opportunities for increasing our total return, it also has the
potential to increase losses. Accordingly, any event that adversely affects the value of an investment would be magnified to the extent we use leverage. Such events could result in a
substantial loss to us, which would be greater than if leverage had not been used. In addition, our investment objectives are dependent on the continued availability of leverage at
attractive relative interest rates.
We could issue senior debt securities to banks, insurance companies and other lenders. Lenders of these senior securities will have fixed dollar claims on our assets that are superior to
the claims of our common stockholders, and we would expect such lenders to seek recovery against our assets in the event of a default. We have the ability to pledge up to 100% of our
assets and can grant a security interest in all of our assets under the terms of any debt instruments we could enter into with lenders. The terms of our existing indebtedness require us
to comply with certain financial and operational covenants, and we expect similar covenants in future debt instruments. Failure to comply with such covenants could result in a default
under the applicable credit facility or debt instrument if we are unable to obtain a waiver from the applicable lender or holder, and such lender or holder could accelerate repayment
under such indebtedness and negatively affect our business, financial condition, results of operations and cash flows. In addition, under the terms of any credit facility or other debt
instrument we enter into, we are likely to be required by its terms to use the net proceeds of any 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, leveraging would cause our net asset value to decline more sharply than it
otherwise would have had we not used leverage, thereby magnifying losses or eliminating our equity stake in a leveraged investment. Similarly, any decrease in our net investment
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 or any outstanding preferred stock. Our ability to service our debt depends largely on our financial performance and is subject to prevailing economic conditions and
competitive pressures. Our common stockholders bear the burden of any increase in our expenses as a result of our use of leverage, including interest expenses and any increase in
the base management fee payable to GC Advisors.
Following the approval of our stockholders of the reduced asset coverage requirements in Section 61(a)(2) of the 1940 Act and subject to our compliance with certain disclosure
requirements, effective as of February 6, 2019, the reduced asset coverage requirement permits us to double the maximum amount of leverage that we are permitted to incur, which
provides us with increased investment flexibility, but also increases our risks related to leverage.
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The following table illustrates the effect of leverage on returns from an investment in our common stock as of September 30, 2023, assuming various annual returns, net of expenses.
The calculations in the table below are hypothetical and actual returns could be higher or lower than those appearing in the table below.
Corresponding return to common stockholder
(1)
-10%
-28.51%
Assumed Return on Our Portfolio (Net of Expenses)
0%
-6.00%
-5%
-17.26%
5%
5.25%
10%
16.50%
(1)
Assumes $5.7 billion in total assets, $3.1 billion in debt and secured borrowings outstanding and $2.5 billion in net assets as of September 30, 2023 and an effective annual interest rate of 4.91% as of September
30, 2023.
Based on our outstanding indebtedness of $3.1 billion as of September 30, 2023 and the effective annual interest rate, which includes amortization of debt financing costs, amortization
of discounts on notes issued and non-usage facility fees, of 4.91% as of that date, our investment portfolio would have been required to experience an annual return of at least 4.85% to
cover annual interest payments on the outstanding debt.
If we are unable to obtain leverage or if the interest rates of such leverage are not attractive, we could experience diminished returns. The number of leverage providers and the total
amount of financing available could decrease or remain static. We could, directly or through subsidiaries, have concentrated exposure to a small number of commercial lenders or other
financing providers, which could result in us being dependent on the continued availability of capital from such financing providers. Consequently, available financing could be more
expensive or on terms that are less desirable than in an environment with a larger number of leverage providers.
We are subject to risks associated with the Debt Securitizations.
As a result of the 2018 Debt Securitization and the GCIC 2018 Debt Securitization, we are subject to a variety of risks, including those set forth below. We use the term “debt
securitization” in this annual report on Form 10-K to describe a form of secured borrowing under which an operating company (sometimes referred to as an “originator” or “sponsor”)
acquires or originates mortgages, receivables, loans or other assets that earn income, whether on a one-time or recurring basis (collectively, “income producing assets”), and borrows
money on a non-recourse basis against a legally separate pool of loans or other income producing assets. In a typical debt securitization, the originator transfers the loans or income
producing assets to a single-purpose, bankruptcy-remote subsidiary (also referred to as a “special purpose entity”), which is established solely for the purpose of holding loans and
income producing assets and issuing debt secured by these income producing assets. The special purpose entity completes the borrowing through the issuance of notes secured by
the loans or other assets. The special purpose entity could issue the notes in the capital markets to a variety of investors, including banks, non-bank financial institutions and other
investors. The special purpose entities that issued the notes in the 2018 Debt Securitization and the GCIC 2018 Debt Securitization were the 2018 Issuer and the GCIC 2018 Issuer,
respectively (each such special purpose entity, a “Securitization Issuer”). The 2018 Issuer and the GCIC 2018 Issuer are wholly-owned subsidiaries of 2018 CLO Depositor and GCIC
CLO Depositor, respectively, each a wholly-owned subsidiary of Golub Capital BDC, Inc. (each, a “CLO Depositor”). In each of the Debt Securitizations, institutional investors
purchased certain notes issued by the applicable Securitization Issuer in private placements.
We are subject to certain risks as a result of our direct or indirect interests in the junior notes and membership interests of each Securitization Issuer.
Under the terms of the respective loan sale agreement or loan sale agreements governing each Debt Securitization, we sold and/or contributed to the applicable Securitization Issuer
all of our ownership interest in our portfolio loans and participations for the purchase price and other consideration set forth in such loan sale agreement. Following this transfer, the
applicable Securitization Issuer held all of the ownership interest in such portfolio loans and participations.
Under the terms of the respective loan sale agreements entered into upon closing of each of the 2018 Debt Securitization and the GCIC 2018 Debt Securitization (each a “Closing Date
Loan Sale Agreement”), which provided for the sale of assets on the applicable closing date to satisfy risk retention requirements, (1) we transferred to GC Advisors a portion of our
ownership interest in the portfolio company investments securing such Debt Securitization for the purchase price and other consideration set forth in the applicable Closing Date Loan
Sale Agreement and (2) immediately thereafter, GC Advisors sold to the respective Securitization Issuer all of its ownership interest in such portfolio loans for the purchase price and
other consideration set forth in the applicable
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Closing Date Loan Sale Agreement. Under the terms of the other loan sale agreement governing each such Debt Securitization (each, a “Depositor Loan Sale Agreement”), which
provides for the sale of assets on the applicable closing date as well as future sales from us to the applicable Securitization Issuer through the applicable CLO Depositor, (1) we sold
and/or contributed to the applicable CLO Depositor the remainder of our ownership interest in the portfolio company investments securing the applicable Debt Securitization and
participations for the purchase price and other consideration set forth in the applicable Depositor Loan Sale Agreement and (2) the applicable CLO Depositor, in turn, sold to the
applicable Securitization Issuer all of its ownership interest in such portfolio loans and participations for the purchase price and other consideration set forth in one of the loan sale
agreements. Following these transfers, the applicable Securitization Issuer, and not GC Advisors, the applicable CLO Depositor or us, held all of the ownership interest in such portfolio
company investments and participations.
As of September 30, 2023, we held indirectly through the applicable CLO Depositor, the Class C-2 2018 Notes, the Class D 2018 Notes, the Subordinated 2018 Notes, and 100% of
the membership interests in the 2018 Issuer, the Class C GCIC 2018 Notes, the Class D GCIC 2018 Notes, the Subordinated GCIC 2018 Notes and 100% of the membership interests
in the GCIC 2018 Issuer. As a result, we consolidate the financial statements of the 2018 Issuer and the GCIC 2018 Issuer, as well as our other subsidiaries, in our consolidated
financial statements.
Because each of the Securitization Issuers and CLO Depositors is disregarded as an entity separate from its owner for U.S. federal income tax purposes, the sale or contribution by us
or a CLO Depositor to a Securitization Issuer or by us to a CLO Depositor did not constitute a taxable event for U.S. federal income tax purposes. If the U.S. Internal Revenue Service
were to take a contrary position, there could be a material adverse effect on our business, financial condition, results of operations or cash flows. We could, from time to time, hold
asset-backed securities, or the economic equivalent thereof, issued by a securitization vehicle sponsored by another business development company to the extent permitted under the
1940 Act.
The notes and membership interests that we hold that are issued by the Securitization Issuers are subordinated obligations of the applicable Securitization Issuer and we
could be prevented from receiving cash from such Securitization Issuer.
The notes issued by the Securitization Issuers and retained by us are the most junior class of notes issued by the applicable Securitization Issuer, are subordinated in priority of
payment to the other notes issued by such Securitization Issuer and are subject to certain payment restrictions set forth in the indenture governing the notes issued by such
Securitization Issuer. Therefore, we only receive cash distributions on such Notes if the applicable Securitization Issuer has made all cash interest payments to all other notes it has
issued. Consequently, to the extent that the value of the portfolio of loan investments held by a Securitization Issuer has been reduced as a result of conditions in the credit markets, or
as a result of defaulted loans or individual fund assets, the value of any notes that we have retained at their redemption could be reduced. If a Securitization Issuer does not meet the
asset coverage tests or the interest coverage test set forth in the documents governing the applicable Debt Securitization, cash would be diverted from the notes that we hold to first
pay the more senior notes issued by such Securitization Issuer in amounts sufficient to cause such tests to be satisfied.
Each Securitization Issuer is the residual claimant on funds, if any, remaining after holders of all classes of notes issued by such Securitization Issuer have been paid in full on each
payment date or upon maturity of such notes under the applicable Debt Securitization documents. As the holder of the membership interests in each Securitization Issuer, we could
receive distributions, if any, only to the extent that the applicable Securitization Issuer makes distributions out of funds remaining after holders of all classes of notes issued by such
Securitization Issuer have been paid in full on each payment date any amounts due and owing on such payment date or upon maturity of such notes. In the event that we fail to receive
cash directly from a Securitization Issuer, we could be unable to make distributions in amounts sufficient to maintain our ability to be subject to tax as a RIC, or at all.
The interests of holders of the senior classes of securities issued by the Securitization Issuers could not be aligned with our interests.
The notes issued by each Securitization Issuer that are held by third parties (the “Senior Securitization Notes”) are debt obligations ranking senior in right of payment to other securities
issued by the respective Securitization Issuer in the applicable Debt Securitization. As such, there are circumstances in which the interests of holders of the Senior Securitization Notes
may not be aligned with
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the interests of holders of the other classes of notes issued by, and membership interests of, the applicable Securitization Issuer. For example, under the terms of the Class A 2018
Notes, holders of the Class A 2018 Notes have the right to receive payments of principal and interest prior to holders of the Class B 2018 Notes, the Class C-1 2018 Notes and the
2018 Issuer.
As used herein, “Controlling Class” refers to the most senior class of notes then outstanding with respect to a Securitization Issuer. If the most senior class of outstanding notes are
paid in full, then the next most senior class of notes would comprise the Controlling Class under the documents governing the applicable Debt Securitization. For example, as long as
the Class A 2018 Notes and the Class A GCIC 2018 Notes are outstanding, holders of such class of notes comprise the Controlling Class under the 2018 Debt Securitization and the
GCIC 2018 Debt Securitization, respectively. If such notes or loans are paid in full, then the Class B 2018 Notes and the Class B GCIC 2018 Notes would comprise the Controlling
Class under the 2018 Debt Securitization and the GCIC 2018 Debt Securitization, respectively. Holders of the Controlling Class under the applicable Debt Securitization have the right
to act in certain circumstances with respect to the portfolio loans in ways that could benefit their interests but not the interests of holders of more junior classes of notes and
membership interests, including by exercising remedies under the indenture in the applicable Debt Securitization.
If an event of default has occurred and acceleration occurs in accordance with the terms of the indenture for a Debt Securitization, the Controlling Class of such Debt Securitization, as
the most senior class of notes or loans then outstanding in such Debt Securitization will be paid in full before any further payment or distribution on the more junior classes of notes and
membership interests. In addition, if an event of default under a Debt Securitization, holders of a majority of the Controlling Class of the applicable Debt Securitization could be entitled
to determine the remedies to be exercised under the applicable indenture, subject to the terms of such indenture. For example, upon the occurrence of an event of default with respect
to the notes issued by the 2018 Issuer, the trustee or holders of a majority of the Controlling Class could declare the principal, together with any accrued interest, of all the notes of
such class and any junior classes to be immediately due and payable. This would have the effect of accelerating the principal on such notes, triggering a repayment obligation on the
part of the 2018 Issuer. If at such time the portfolio loans were not performing well, the Securitization Issuer could not have sufficient proceeds available to enable the trustee under the
indenture to repay the obligations of holders of the notes we hold, or to pay a dividend to holders of the membership interests.
Remedies pursued by the Controlling Class could be adverse to the interests of the holders of the notes that are subordinated to the Controlling Class (which would include, for
example, the Class C‑2 2018 Notes, Class D 2018 Notes and Subordinated 2018 Notes to the extent the Class A 2018 Notes, Class B 2018 Notes, Class C-1 2018 Notes and Class C-
2 2018 Notes, or Class D 2018 Notes constitute the Controlling Class, the Class B‑2 GCIC 2018 Notes, Class C GCIC 2018 Notes, Class D GCIC 2018 Notes and Subordinated GCIC
2018 Notes to the extent the Class A-1 GCIC 2018 Notes, Class A-2 GCIC 2018 Notes, Class B GCIC 2018 Notes, Class C GCIC 2018 Notes or Class D GCIC 2018 Notes constitute
the Controlling Class) and the Controlling Class will have no obligation to consider any possible adverse effect on such other interests. Thus, we cannot assure you that any remedies
pursued by the Controlling Class will be in the best interests of the applicable CLO Depositor or us or that the applicable CLO Depositor or we will receive any payments or distributions
upon an acceleration of the notes. In a liquidation under any of the Debt Securitizations, the notes that we have directly or indirectly retained will be subordinated to payment of the
other classes notes issued by the applicable Securitization Issuer and could not be paid in full to the extent funds remaining after payment of more senior notes not held by us are
insufficient. In addition, after certain senior classes of notes are paid in full, the remaining noteholder could amend the applicable indenture to, among other things, direct the
assignment of any remaining assets to other wholly-owned subsidiaries for a price less than the fair market value of such assets with the difference in price to be considered an equity
contribution to such subsidiaries. Any failure of a Securitization Issuer to make distributions on the notes we indirectly or directly hold, whether as a result of an event of default,
liquidation or otherwise, could have a material adverse effect on our business, financial condition, results of operations and cash flows and could result in an inability of us to make
distributions sufficient to maintain our ability to be subject to tax as a RIC, or at all.
A Securitization Issuer could fail to meet certain asset coverage tests.
Under the documents governing each of the Debt Securitizations, there are two asset coverage tests applicable to the Class A 2018 Notes, the Class B 2018 Notes, the Class C-1 2018
Notes, the Class C-2 2018 Notes and the Class D 2018 Notes, with respect to the 2018 Issuer; and the Class A GCIC 2018 Notes, Class B GCIC 2018 Notes, Class C GCIC 2018
Notes and Class D GCIC 2018, with respect to the GCIC 2018 Issuer.
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The first such test compares the amount of interest received on the portfolio loans held by the applicable Securitization Issuer to the amount of interest payable in respect of the
applicable class of notes. To meet this first test, in the case of the 2018 Debt Securitization, interest received on the portfolio loans must equal at least 120% of the interest payable in
respect of the Class A 2018 Notes and Class B 2018 Notes, taken together, at least 110% of the interest payable in respect of the Class C-1 2018 Notes and the Class C-2 2018 Notes,
taken together, and at least 105% of the interest payable in respect of the Class D 2018 Notes; and, in the case of the GCIC 2018 Debt Securitization, interest received on the portfolio
loans must equal at least 120% of the interest payable in respect of the Class A GCIC 2018 Notes and Class B GCIC 2018 Notes, taken together, and at least 110% of the interest
payable in respect of the Class C GCIC 2018 Notes and at least 105% of the interest payable in respect of the Class D GCIC 2018 Notes.
The second such test compares the principal amount of the portfolio loans of the applicable Debt Securitization to the aggregate outstanding principal amount of the applicable class of
notes. To meet this second test at any time in the case of the 2018 Debt Securitization, the aggregate principal amount of the portfolio loans must equal at least 145.6% of the Class A
2018 Notes and Class B 2018 Notes, taken together, at least 126.7% of the Class C-1 2018 Notes and Class C-2 2018 Notes, taken together, and at least 116.7% of the Class D 2018
Notes. To meet this second test at any time in the case of the GCIC 2018 Debt Securitization, the aggregate principal amount of the portfolio loans must equal at least 147.9% of the
Class A GCIC 2018 Notes and Class B GCIC 2018 Notes, taken together, at least 127.1% of the Class C GCIC 2018 Notes and at least 117.5% of the Class D GCIC 2018 Notes.
If any asset coverage test with respect to a class of notes is not met, proceeds from the portfolio of loan investments that otherwise would have been distributed to the holders of the
notes and membership interests that we hold will instead be used to redeem first the most senior class of notes in such Debt Securitization and then each next most senior class of
notes, to the extent necessary to satisfy the applicable asset coverage tests on a pro forma basis after giving effect to all payments made in respect of the notes, which we refer to as a
mandatory redemption, or to obtain the necessary ratings confirmation.
The value of the Class C-2 2018 Notes, Class D 2018 Notes, Subordinated 2018 Notes, Class B-2 GCIC 2018 Notes, Class C GCIC 2018 Notes, Class D GCIC 2018 Notes or the
Subordinated GCIC 2018 Notes could be adversely affected by a mandatory redemption because such redemption could result in the applicable notes being redeemed at par at a time
when they are trading in the secondary market at a premium to their stated principal amount and when other investments bearing the same rate of interest could be difficult or
expensive to acquire. A mandatory redemption could also result in a shorter investment duration than a holder of such notes could have wanted or anticipated, which could, in turn,
result in such a holder incurring breakage costs on related hedging transactions.
We could be required to assume liabilities of a Securitization Issuer and are indirectly liable for certain representations and warranties in connection with each Debt
Securitization.
The structure of each Debt Securitization is intended to prevent, in the event of our bankruptcy or the bankruptcy of a CLO Depositor, if applicable, the consolidation of the applicable
Securitization Issuer with our operations or with the applicable CLO Depositor. If the true sale of the assets in each Debt Securitization were not respected in the event of our
insolvency, a trustee or debtor-in-possession might reclaim the assets of the applicable Securitization Issuer for our estate. However, in doing so, we would become directly liable for all
of the indebtedness then outstanding under the applicable Debt Securitization, which would equal the full amount of debt of the applicable Securitization Issuer reflected on our
consolidated balance sheet. In addition, we cannot assure you that the recovery in the event we were consolidated with a Securitization Issuer for purposes of any bankruptcy
proceeding would exceed the amount to which we would otherwise be entitled as the holder of the notes issued by such Securitization Issuer and retained by us had we not been
consolidated with the applicable Securitization Issuer.
In addition, in connection with each of the Debt Securitizations, we indirectly gave the lenders certain customary representations with respect to the legal structure of the respective
Securitization Issuer, and the quality of the assets transferred to each entity. We remain indirectly liable for any breach of such representations for the life of the applicable Debt
Securitization.
Certain Securitization Issuers could issue additional Notes.
Under the terms of the documents governing the 2018 Debt Securitization and the GCIC 2018 Debt Securitization, the applicable Securitization Issuer could issue additional notes and
use the net proceeds of such issuance to purchase additional portfolio loans. Any such additional issuance, however, would require the consent of the
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collateral manager to the applicable Debt Securitization and, in the case of each of the 2018 Debt Securitization and the GCIC 2018 Debt Securitization, the applicable CLO Depositor
and a supermajority of the Subordinated 2018 Notes or Subordinated GCIC 2018 Notes, as applicable.
Among the other conditions that must be satisfied in connection with an additional issuance of notes, the aggregate principal amount of all additional issuances of notes may not exceed
100% of the respective original outstanding principal amount of such class of notes; the applicable Securitization Issuer must notify each rating agency of such issuance prior to the
issuance date; and the terms of the notes to be issued must be identical to the terms of previously issued notes of the same class (except that all monies due on such additional notes
will accrue from the issue date of such notes and that the spread over LIBOR and prices of such notes do not have to be identical to those of the initial notes, provided that the interest
rate on such additional notes must not exceed the interest rate applicable to the initial class of such notes). We do not expect to cause the 2018 Issuer or the GCIC 2018 Issuer to issue
any additional notes at this time. We could amend the documents governing each Debt Securitization from time to time, and without amendment, the 2018 Debt Securitization
documents do not provide for additional issuances of Class A 2018 Notes. The total purchase price for any additional notes that could be issued may not always equal 100% of the par
value of such notes, depending on several factors, including fees and closing expenses.
We are subject to risks associated with any Revolving Credit Facility that utilizes a Funding Subsidiary as our interests in any Funding Subsidiary are subordinated and
we could be prevented from receiving cash on our equity interests from a Funding Subsidiary.
We own directly or indirectly 100% of the equity interests in each of our Funding Subsidiaries. We consolidate the financial statements of our Funding Subsidiaries in our consolidated
financial statements and treat the indebtedness under the Revolving Credit Facilities as our leverage. Our interests in our Funding Subsidiaries are subordinated in priority of payment
to every other obligation of such Funding Subsidiary and are subject to certain payment restrictions set forth in each Revolving Credit Facility.
We receive cash from a Funding Subsidiary only to the extent that we receive distributions on our equity interests in such Funding Subsidiary. Each Funding Subsidiary could make
distributions on its equity interests only to the extent permitted by the payment priority provisions of the applicable Revolving Credit Facility. Each of the Revolving Credit Facilities
generally provides that payments on the respective interests could not be made on any payment date unless all amounts owing to the lenders and other secured parties are paid in full.
In addition, if a Funding Subsidiary does not meet the asset coverage tests or the interest coverage test set forth in the documents of the applicable Revolving Credit Facility, a default
would occur. In the event of a default under a Revolving Credit Facility document, cash would be diverted from us to pay the applicable lender and other secured parties in amounts
sufficient to cause such tests to be satisfied. In the event that we fail to receive cash from our Funding Subsidiaries, we could be unable to make distributions to our stockholders in
amounts sufficient to maintain our status as a RIC, or at all. We also could be forced to sell investments in portfolio companies at less than their fair value in order to continue making
such distributions. We cannot assure you that distributions on the assets held by our Funding Subsidiaries will be sufficient to make any distributions to us or that such distributions will
meet our expectations.
Our equity interests in each Funding Subsidiary rank behind all of the secured and unsecured creditors, known or unknown, of such Funding Subsidiary, including the lenders in the
respective Revolving Credit Facility. Consequently, to the extent that the value of a Funding Subsidiary’s portfolio of loan investments has been reduced as a result of conditions in the
credit markets, defaulted loans, capital gains and losses on the underlying assets, prepayment or changes in interest rates, the returns on our investments in such Funding Subsidiary
could be reduced. Accordingly, our investments in each of our Funding Subsidiaries could be subject to up to 100% loss.
The ability to sell investments held by our Funding Subsidiaries is limited.
Each of the Revolving Credit Facilities place significant restrictions on our ability, as servicer, to sell investments. As a result, there could be times or circumstances during which we
are unable to sell investments or take other actions that might be in our best interests.
We can enter into repurchase agreements, which are another form of leverage.
We can enter, and have in the past entered, into repurchase agreements as part of our management of our investment portfolio. Under a repurchase agreement, we will effectively
pledge our assets as collateral to secure a short-term loan where the counterparty acquires securities we hold as collateral subject to our obligation to repurchase and its obligation to
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upon time and price. Generally, the other party to the agreement makes the loan in an amount equal to a percentage of the fair value of the pledged collateral. At the maturity of the
repurchase agreement, we will be required to repay the loan and correspondingly receive back our collateral. While used as collateral, the assets continue to pay principal and interest
which are for our benefit.
Our use of repurchase agreements, if any, involves many of the same risks involved in our use of leverage, as the proceeds from repurchase agreements generally will be invested in
additional securities. There is a risk that the market value of the securities acquired in the repurchase agreement could decline below the price of the securities that we have sold but
remain obligated to purchase. In addition, there is a risk that the market value of the securities retained by us could decline. If a buyer of securities under a repurchase agreement were
to file for bankruptcy or experience insolvency, we could be adversely affected. Also, in entering into repurchase agreements, we would bear the risk of loss to the extent that the
proceeds of such agreements at settlement are less than the fair value of the underlying securities being pledged. In addition, due to the interest costs associated with repurchase
agreements, our net asset value would decline, and, in some cases, we could be worse off than if we had not used such agreements.
Adverse developments in the credit markets can impair our ability to enter into new debt financing arrangements.
During the economic downturn in the United States that began in mid-2007, many commercial banks and other
financial institutions stopped lending or significantly curtailed their lending activity. In addition, in an effort to stem
losses and reduce their exposure to segments of the economy deemed to be high risk, some financial institutions
limited routine refinancing and loan modification transactions and even reviewed the terms of existing facilities to
identify bases for accelerating the maturity of existing lending facilities. To the extent these circumstances arise
again in the future, it could be difficult for us to finance the growth of our investments on acceptable economic terms, or at all and one or more of our leverage facilities could be
accelerated by the lenders.
Adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults or non-performance by financial
institutions or transactional counterparties could have a material adverse effect on us, GC Advisors and our portfolio companies.
Cash not held in custody accounts and held by us, GC Advisors and by our portfolio companies in non-interest-bearing and interest-bearing operating accounts could, at times, exceed
the Federal Deposit Insurance Corporation (“FDIC”) insurance limits. If such banking institutions were to fail, we, GC Advisors, or our portfolio companies could lose all or a portion of
those amounts held in excess of such insurance limits. In addition, actual events involving limited liquidity, defaults, non-performance or other adverse developments that affect financial
institutions, transactional counterparties or other companies in the financial services industry or the financial services industry generally, or concerns or rumors about any events of
these kinds or other similar risks, have in the past and may in the future lead to market-wide liquidity problems, which could adversely affect our, GC Advisors’ and our portfolio
companies’ business, financial condition, results of operations, or prospects.
Although we and GC Advisors assess our and our portfolio companies’ banking and financing relationships as we believe necessary or appropriate, our and our portfolio companies’
access to funding sources and other credit arrangements in amounts adequate to finance or capitalize current and projected future business operations could be significantly impaired
by factors that affect the financial institutions with which we, GC Advisors or our portfolio companies have arrangements directly or the financial services industry or economy in
general. These factors could include, among others, events such as liquidity constraints or failures, the ability to perform obligations under various types of financial, credit or liquidity
agreements or arrangements, disruptions or instability in the financial services industry or financial markets, or concerns or negative expectations about the prospects for companies in
the financial services industry. These factors could involve financial institutions or financial services industry companies with which we, GC Advisors or our portfolio companies have
financial or business relationships, but could also include factors involving financial markets or the financial services industry generally.
In addition, investor concerns regarding the U.S. or international financial systems could result in less favorable commercial financing terms, including higher interest rates or costs and
tighter financial and operating covenants, or systemic limitations on access to credit and liquidity sources, thereby making it more difficult for us, GC Advisors, or our portfolio companies
to acquire financing on acceptable terms or at all.
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Our ability to invest in public companies is limited in certain circumstances. If we do not invest a sufficient portion of our assets in qualifying assets, we could fail to
qualify as a business development company or be precluded from investing according to our current business strategy and decrease our operating flexibility.
To maintain our status as a business development company, we are not permitted to acquire any assets other than “qualifying assets” specified in 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). Subject to certain exceptions for follow-on investments and investments in
distressed companies, an investment in an issuer that has outstanding securities listed on a national securities exchange could be treated as qualifying assets only if such issuer has a
common equity market capitalization that is less than $250.0 million at the time of such investment.
See “Business — Regulation — Qualifying Assets.”
We could be precluded from investing in what we believe are attractive investments if such investments are not qualifying assets for purposes of the 1940 Act. If we do not invest a
sufficient portion of our assets in qualifying assets, we could violate the 1940 Act provisions applicable to business development companies. As a result of such violation, specific rules
under the 1940 Act could prevent us, for example, from making follow-on investments in existing portfolio companies (which could result in the dilution of our position) or could require
us to dispose of investments at inappropriate times in order to come into compliance with the 1940 Act. If we need to dispose of such investments quickly, it could be difficult to dispose
of such investments on favorable terms. We can provide no assurance that we will be able to find a buyer for such investments and, even if we do find a buyer, we could be forced to
sell the investments at a substantial loss. Any such outcomes would have a material adverse effect on our business, financial condition, results of operations and cash flows.
If we do not maintain our status as a business development company, we would be subject to regulation as a registered closed-end investment company under the 1940 Act. As a
registered closed-end investment company, we would be subject to substantially more regulatory restrictions under the 1940 Act, which would significantly decrease our operating
flexibility.
The majority of our portfolio investments are recorded at fair value as determined in good faith by our board of directors and, as a result, there could be uncertainty as to
the value of our portfolio investments.
Under the 1940 Act, we are required to carry our portfolio investments at market value or, if there is no readily available market value, at fair value as determined pursuant to policies
adopted by, and subject to the oversight of, our board of directors. The majority of our portfolio investments take the form of securities that are not publicly traded. The fair value of
securities and other investments that are not publicly traded is often not readily determinable, and we value these securities at fair value as determined in good faith by our board of
directors, including to reflect significant events affecting the value of our securities. As discussed in more detail under “Management’s Discussion and Analysis of Financial Condition
and Results of Operations - Critical Accounting Policies,” most, if not all, of our investments (other than cash and cash equivalents) are classified as Level 3 under Accounting
Standards Codification, or ASC, Topic 820, Fair Value Measurement, as amended, or ASC Topic 820. This means that our portfolio valuations are based on unobservable inputs and
our board of directors’ assumptions about how market participants would price the asset or liability in question. Inputs into the determination of fair value of our portfolio investments
require significant management judgment or estimation, the level of which could increase or decrease during periods of volatility or uncertainty. See “—Risks Relating to Our Business
and Structure – We are currently in a period of capital markets disruption and economic uncertainty.” Even if observable market data are available, such information could be the result
of consensus pricing information or broker quotes, which could include a disclaimer that the broker would not be held to such a price in an actual transaction. The non-binding nature of
consensus pricing and/or quotes accompanied by disclaimers materially reduces the reliability of such information.
We have retained the services of several independent service providers to review the valuation of these securities. At least once annually, the valuation for each portfolio investment for
which a market quote is not readily available is reviewed by an independent valuation firm. The types of factors that our board of directors could take into account in determining the fair
value of our investments generally include, as appropriate, comparison to publicly traded securities, including such factors as yield, maturity and measures of credit quality, the
enterprise value of a portfolio company, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flow,
the markets in which the portfolio company does business and other relevant factors. Because such valuations, and particularly valuations of private securities and private companies,
are inherently uncertain, could fluctuate over short periods of time and could be based on estimates,
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our determinations of fair value could differ materially from the values that would have been used if a ready market for these securities existed. Our net asset value could be adversely
affected if our determinations regarding the fair value of our investments were materially higher than the values that we ultimately realize upon the disposal of such securities.
We adjust quarterly the valuation of our portfolio to reflect our board of directors’ determination of the fair value of each investment in our portfolio. Any changes in fair value are
recorded in our consolidated statement of operations as net change in unrealized appreciation or depreciation.
Government intervention in the credit markets could adversely affect our business.
The central banks and, in particular, the U.S. Federal Reserve, have taken unprecedented steps in response to the financial crises of 2008-2009, the global COVID-19 pandemic and,
more recently, to inflationary pressures. It is impossible to predict if, how, and to what extent the United States and other governments would further intervene in the credit markets.
Such intervention is often prompted by politically sensitive issues involving family homes, student loans, real estate speculation, credit card receivables, pandemics, etc., and could, as
a result, be contrary to what we would predict from an “economically rational” perspective.
On the other hand, recent governmental intervention could mean that the willingness of governmental bodies to take additional extraordinary action is diminished. As a result, in the
event of near-term major market disruptions, like those caused by a global health crisis, such as the COVID-19 pandemic, there might be only limited additional government
intervention, resulting in correspondingly greater market dislocation and materially greater market risk.
Our board of directors could change our investment objective, operating policies and strategies without prior notice or stockholder approval.
Our board of directors has the authority, except as otherwise provided in the 1940 Act, to modify or waive our investment objective and certain of our operating policies and strategies
without prior notice and without stockholder approval. However, absent stockholder approval, we cannot change the nature of our business so as to cease to be, or withdraw our
election as, a business development company. Under Delaware law, we also cannot be dissolved without prior stockholder approval. We cannot predict the effect any changes to our
current investment objective, operating policies and strategies would have on our business, operating results and the price of our common stock. Nevertheless, any such changes
could adversely affect our business and impair our ability to make distributions.
Provisions of the General Corporation Law of the State of Delaware and our certificate of incorporation and bylaws could deter takeover attempts, which could have an
adverse effect on the price of our common stock.
The General Corporation Law of the State of Delaware, or the DGCL, contains provisions that are intended to discourage, delay or make more difficult a change in control of us or the
removal of our directors. Our certificate of incorporation and bylaws contain provisions that limit liability and provide for indemnification of our directors and officers. These provisions
and others also could have the effect of deterring hostile takeovers or delaying changes in control or management. We are subject to Section 203 of the DGCL, the application of which
is subject to any applicable requirements of the 1940 Act. This section generally prohibits us from engaging in mergers and other business combinations with stockholders that
beneficially own 15% or more of our voting stock, or with their affiliates, unless our directors or stockholders approve the business combination in the prescribed manner. If our board of
directors does not approve a business combination, Section 203 of the DGCL could discourage third parties from trying to acquire control of us and increase the difficulty of
consummating such an offer.
We have also adopted measures that could make it difficult for a third party to obtain control of us, including provisions of our certificate of incorporation classifying our board of
directors in three classes serving staggered three-year terms, and provisions of our certificate of incorporation authorizing our board of directors to classify or reclassify shares of our
preferred stock in one or more classes or series, to cause the issuance of additional shares of our stock, and to amend our certificate of incorporation, without stockholder approval, in
certain instances. These provisions, as well as other provisions of our certificate of incorporation and bylaws, could delay, defer or prevent a transaction or a change in control that
might otherwise be in the best interests of our securityholders.
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GC Advisors can resign on 60 days’ notice, and we can provide no assurance that we would 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.
GC Advisors has the right to resign under the Investment Advisory Agreement at any time upon not less than 60 days’ written notice, whether we have found a replacement or not. If
GC Advisors resigns, we can provide no assurance that we would be able to find a new investment adviser 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 business, financial
condition and results of operations and cash flows as well as our ability to pay distributions are likely to be adversely affected and the market price of our common stock could 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 by GC Advisors
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 and portfolio could result in additional costs and time delays that could adversely affect our business, financial condition, results of operations and cash flows.
The Administrator can resign on 60 days’ notice, and we can provide no assurance that we would be able to find a suitable replacement, resulting in a disruption in our
operations that could adversely affect our financial condition, business and results of operations.
The Administrator has the right to resign under the Administration Agreement at any time upon not less than 60 days’ written notice, whether we have found a replacement or not. If the
Administrator resigns, we can provide no assurance that we would be able to find a new administrator or hire internal management with similar expertise and ability to provide the same
or equivalent services on acceptable terms, 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 common stock could decline. In addition, the coordination of our
internal management and administrative activities is likely to suffer if we are unable to identify and reach an agreement with a service provider or individuals with the expertise
possessed by the Administrator. Even if we are able to retain a comparable service provider or individuals to perform such services, whether internal or external, their integration into
our business and lack of familiarity with our investment objective and portfolio could result in additional costs and time delays that could adversely affect our business, financial
condition, results of operations and cash flows.
Risks Relating to Our Investments
Economic recessions or downturns could impair our portfolio companies and defaults by our portfolio companies will harm our operating results.
Many of our portfolio companies are susceptible to economic slowdowns or recessions and could be unable to repay our loans during these periods. Therefore, our non-performing
assets are likely to increase and the value of our portfolio is likely to decrease during these periods. Adverse economic conditions could decrease the value of collateral securing any of
our loans and the value of any equity investments. A severe recession could further decrease the value of such collateral and result in losses of value in our portfolio and a decrease in
our revenues, net income, assets and net worth. Economic slowdowns or recessions could lead to financial losses in our portfolio and a decrease in revenues, net income and assets.
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 prevent us from increasing our investments and harm our operating results.
Any deterioration of general economic conditions could lead to significant declines in corporate earnings or loan performance, and the ability of corporate borrowers to service their debt,
any of which could trigger a period of global economic slowdown, and have an adverse impact on our performance and financial results, and the value and the liquidity of our
investments. In an economic downturn, we could have non-performing assets or an increase in non-performing assets, and we would anticipate that the value of our portfolio would
decrease during these periods. Failure to satisfy financial or operating covenants imposed by lenders to a portfolio company, including us, could lead to defaults and, potentially,
acceleration of payments on such loans and foreclosure on the assets representing collateral for the portfolio company’s obligations. Cross default provisions under other agreements
could be triggered and thus limit the portfolio company’s ability to satisfy its obligations under any debt that we hold and
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affect the value of any equity securities we own. We would expect to incur expenses to the extent necessary to seek recovery upon default or to negotiate new terms with a portfolio
company following or in anticipation of a default.
Inflation could adversely affect the business, results of operations and financial condition of our portfolio companies.
Certain of our portfolio companies are in industries that could be impacted by inflation. If such portfolio companies are unable to pass any increases in their costs of operations along to
their customers, it could adversely affect their operating results and impact their ability to pay interest and principal on our loans, particularly if interest rates rise in response to inflation.
In addition, any projected future decreases in our portfolio companies’ operating results due to inflation could adversely impact the fair value of those investments. Any decreases in
the fair value of our investments could result in future realized or unrealized losses and therefore reduce our net increase (decrease) in net assets resulting from operations.
Our debt investments are risky and we could lose all or part of our investments.
The debt that we invest in is typically not initially rated by any rating agency, but we believe that if such investments were rated, they would be below investment grade (rated lower
than “Baa3” by Moody’s Investors Service, lower than “BBB-” by Fitch Ratings or lower than “BBB-” by Standard & Poor’s Ratings Services), which under the guidelines established by
these entities is an indication of having predominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal. Bonds that are rated below
investment grade are sometimes referred to as “high yield bonds” or “junk bonds.” Therefore, our investments could result in an above average amount of risk and volatility or loss of
principal.
Our investments in leveraged portfolio companies are risky, and we could lose all or part of our investment.
Investment in leveraged companies involves a number of significant risks. Leveraged companies in which we invest could have limited financial resources and could be unable to meet
their obligations under their debt securities that we hold. These companies could be subject to restrictive financial and operating covenants and their leverage could impair their ability
to finance their future operations and capital needs. As a result, these companies’ flexibility to respond to changing business and economic conditions and to take advantage of
business opportunities could be limited. Such developments could be accompanied by a deterioration in the value of any collateral and a reduction in the likelihood of our realizing any
guarantees that we could have obtained in connection with our investment. Smaller leveraged companies also could have less predictable operating results and could require
substantial additional capital to support their operations, finance their expansion or maintain their competitive position.
Our investments in private and middle-market portfolio companies are risky, and we could lose all or part of our investment.
Investment in private and middle-market companies involves a number of significant risks. Generally, little public information exists about these companies, and we rely on the ability of
GC Advisors’ investment professionals to obtain adequate information to evaluate the potential returns from investing in these companies. If GC Advisors is unable to uncover all
material information about these companies, it would not be able to make a fully informed investment decision and we could lose money on our investments. Compared to larger
companies, middle-market companies typically have shorter operating histories, more limited financial resources, newer technologies and/or products, smaller market shares, less
experienced management teams and less predictable operating results, and often participate in quickly evolving markets, and are more reliant on a small number of products,
managers or clients. Middle-market companies could also require substantial additional capital to support their operations, finance expansion or maintain their competitive position and
could have difficulty accessing the capital markets to meet future capital needs, which could limit their ability to grow or to repay their outstanding indebtedness upon maturity. In
addition, the middle-market companies in which we invest could be subject to governmental and non-governmental regulations, including by federal and state regulators and various
self-regulatory organizations and the costs of complying with these laws and regulations could be more material to the company as compared to a larger company. If a company in
which we directly or indirectly invest fails to comply with an applicable regulatory regime, it could be subject to fines, injunctions, operating restrictions or criminal prosecution, any of
which could materially and adversely affect the value of our investment. We will not control a portfolio company’s management or the manner in which a company’s management
addresses the company’s risks except in the event that a portfolio company defaults on its loan from us and we seek to enforce our security interest. In addition, middle-market
companies often require additional financing to expand or maintain their competitive position, and they could have a more difficult time obtaining additional capital than larger
companies.
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An important concern in making investments is the possibility of material misrepresentation or omission on the part of the portfolio company. Such inaccuracy or incompleteness can
adversely affect, among other things, the valuation of collateral, other debt obligations, our ability to perfect or effectuate a lien on the collateral securing a loan or other debt obligation,
the financial condition of the issuer, or the business prospects of the issuer. We will rely upon the accuracy and completeness of representations made by portfolio companies to the
extent reasonable. However, there can be no guarantee that such representations are accurate or complete.
If the issuer of securities purchased by us does not perform to GC Advisors’ expectations, the value of its equity and debt securities would likely decline and the issuer could default on
its obligations. Poor performance can be caused by a number of factors, including failures of management, competitive pressures, pressure by customers and suppliers, labor unrest, or
force majeure events, such as the COVID-19 pandemic. While GC Advisors intends to invest in portfolio companies in industries that it believes are resistant to recessions, there can be
no assurance that such portfolio companies will not be adversely affected by other market or economic conditions.
The value of our investments in loans will likely be detrimentally affected to the extent a borrower defaults on its obligations, there is insufficient collateral, and/or there are extensive
legal and other costs incurred in collecting on a defaulted loan. GC Advisors will attempt to minimize this risk, for example, by maintaining low loan-to-liquidation values with each loan
and the collateral underlying the loan. However, there can be no assurance that the liquidation value assigned by GC Advisors would be realized by the portfolio company upon
liquidation, nor can there be any assurance that such collateral will retain its value. In addition, certain of our loans will be supported, in whole or in part, by personal guarantees made
by the borrower or an affiliate of the borrower. If such guarantee is called and the guarantor fails to meet its obligations under the guarantee, the amount realizable with respect to a
loan will
generally be detrimentally affected. There could be a monetary as well as a time cost involved in collecting on defaulted loans and, if applicable, taking possession of various types of
collateral. In addition, any activity deemed to be active lending/origination by us could subject it to additional regulation.
An investment strategy focused primarily on privately held companies presents certain challenges, including, but not limited to, the lack of available information about
these companies.
We invest primarily in privately held companies. Because private companies have reduced access to the capital markets, such companies could have diminished capital resources and
ability to withstand financial distress. Often, the depth and breadth of experience of management in private companies tends to be less than that at public companies, which makes
such companies more likely to depend on the management talents and efforts of a smaller group of persons and/or persons with less depth and breadth of experience. Therefore, the
decisions made by such management teams and/or the departure of one or more of these persons could have a material adverse impact on the portfolio company and, as a result our
investments.
We would be subject to risks if we are required to assume operation of portfolio companies upon default.
We, together with other funds managed by GC Advisors and its affiliates, would be expected to take over a portfolio company if the company defaults on its loans. Depending on factors
including the health of the economy, the credit cycle, and the portfolio companies’ various industries, it is reasonable to assume that portfolio companies will default over time, and this
risk is significantly increased in periods of market uncertainty, including as a result of global health crises, such as the COVID-19 pandemic, or periods of elevated inflation and rising
interest rates. In such circumstances, we and the other funds would likely seek to enforce our rights under the applicable credit documentation and could opt to take over such portfolio
companies. When a portfolio company is taken over, we and the other funds and their investors are subject to different risks than we are as holders of interests in loans to such portfolio
company. Operating a portfolio company, even for a limited period of time pending the sale of collateral, can distract senior personnel of GC Advisors and its affiliates from their normal
business. Additionally, defaulting portfolio companies often require additional capital to be effectively turned around. There is no guarantee that any defaulting portfolio company can be
turned around or that our investments in such portfolio company will be successful. Finally, operating a portfolio company could subject us to potential liabilities, including management,
employment, and/or environmental liabilities.
The lack of liquidity in our investments could adversely affect our business.
The debt to which we are primarily exposed is expected to consist predominantly of loans and notes that are obligations of corporations, partnerships or other entities. This debt often
has no, or only a limited, trading market. The investment in illiquid debt will often restrict our ability to dispose of investments in a timely fashion, for a fair
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price, or at all. If an underlying issuer of debt experiences an adverse event, this illiquidity would make it more difficult for us to sell such debt, and we could instead be required to
pursue a workout or alternate way out of the position. To the extent debt in a portfolio company is also held by other third-party investors, we would generally have limited control over
a workout or alternate means of disposition and the person(s) having such control could have interests that are not aligned with ours. We would likely also face other restrictions on our
ability to liquidate an investment in a portfolio company to the extent that we, GC Advisors, Golub Capital or any of its affiliates have material non-public information regarding such
portfolio company.
Price declines and illiquidity in the corporate debt markets could adversely affect the fair value of our portfolio investments, reducing our net asset value through
increased net unrealized depreciation.
As a business development company, we are required to carry our investments at market value or, if no market value is ascertainable, at fair value as determined in good faith by our
board of directors. The fair value methodology utilized is in accordance with the fair value principles established by the ASC Topic 820. Our board of directors uses the services of one
or more independent service providers to review the valuation of our illiquid investments. Valuations reflect significant events that affect the value of the instruments. As part of the
valuation process, we could take into account the following types of factors, if relevant, in determining the fair value of our investments:
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a comparison of the portfolio company’s securities to publicly traded securities;
the enterprise value of the portfolio company;
the nature and realizable value of any collateral;
the portfolio company’s ability to make payments and its earnings and discounted cash flow;
the markets in which the portfolio company does business; and
changes in the interest rate environment and the credit markets generally that could affect the price at which similar investments could be made in the future and other
relevant factors.
The fair value measurement seeks to approximate the price that would be received for an investment on a current sale and assumes that the transaction to sell an asset occurs in the
principal market for such asset or, in the absence of a principal market, the most advantageous market for such asset, which could be a hypothetical market, and excludes transaction
costs. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we use the pricing indicated by the external event to corroborate our
valuation. We record decreases in the market values or fair values of our investments as unrealized depreciation. Declines in prices and liquidity in the corporate debt markets could
result in significant net unrealized depreciation in our portfolio. The effect of all of these factors on our portfolio could reduce our net asset value by increasing net unrealized
depreciation in our portfolio. Depending on market conditions, we could incur substantial realized losses and could suffer additional unrealized losses in future periods, which could
have a material adverse effect on our business, financial condition, results of operations and cash flows. Because orderly markets currently do not exist for some investments, and
because valuations, and particularly valuations of private investments and private companies, require judgment, are inherently uncertain, could fluctuate over short periods and are
often based on estimates, our determinations of the fair value of investments could differ materially from the values that would have been used had a ready market existed for such
investments.
Our portfolio companies could prepay loans, which could reduce our yields if capital returned cannot be invested in transactions with equal or greater expected yields.
The loans in our investment portfolio could be prepaid at any time, generally with little advance notice. Whether a loan is prepaid will depend both on the continued positive
performance of the portfolio company and the existence of favorable financing market conditions that allow such company the ability to replace existing financing with less expensive
capital. As market conditions change, we do not know when, and if, prepayment could be possible for each portfolio company. Certain fixed-income securities are subject to the risk of
unanticipated prepayment. Prepayment risk is the risk that, when interest rates fall, the issuer will redeem the security prior to the security’s expected maturity. It is possible that we will
reinvest the proceeds from such a redemption at a lower interest rate, resulting in less income to us. Securities subject to prepayment risk generally offer less potential for gains when
prevailing interest rates fall. If we buy those securities at a premium, accelerated prepayments on those securities could cause us to lose a portion of its principal investment. The
impact of prepayments on the price of a security can be difficult to predict and could increase the security’s price volatility.
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We are subject to credit and default risk and our portfolio companies could be unable to repay or refinance outstanding principal on their loans at or prior to maturity.
Credit risk refers to the likelihood that a borrower will default in the payment of principal and/or interest. Financial strength and solvency of a borrower are the primary factors
influencing credit risk. Lack or inadequacy of collateral or credit enhancement for a debt instrument could also affect its credit risk. Credit risk can change over the life of a loan, and
securities and other debt instruments that are rated by rating agencies can be downgraded. This risk and the risk of default is increased to the extent that the loan documents do not
require the portfolio companies to pay down the outstanding principal of such debt prior to maturity, which is expected to be a common feature among many of our loan investments.
Investments with a deferred interest feature, such as original issue discount income and payment-in-kind interest, could represent a higher credit risk than investments that must pay
interest in full in cash on a regular basis.
A significant downturn in the economy or a particular economic sector could have a significant impact on the business prospects of the portfolio companies to which we are exposed,
whether directly or indirectly. Such developments could adversely affect the ability of such companies to comply with their loan repayment obligations. It is possible that the issuer of a
note or other instrument in which we invest could default on its debts, in which case we could lose most or all of our investment in that instrument, subjecting us to significant loss. The
risk and magnitude of losses associated with defaults could be increased where the instrument is leveraged.
We have not yet identified the portfolio company investments we will acquire and we could have difficulty sourcing investment opportunities.
While we currently hold a portfolio of investments, we have not yet identified additional potential investments for our portfolio that we will acquire with the proceeds of any offering of
securities or repayments of investments currently in our portfolio. Privately negotiated investments in loans and illiquid securities or private middle-market companies require substantial
due diligence and structuring, and we cannot provide any assurance that we will achieve our anticipated investment pace. As a result, investors will not be able to evaluate any future
portfolio company investments prior to purchasing our securities. Additionally, GC Advisors selects all of our investments, and our stockholders will have no input with respect to such
investment decisions. These factors increase the uncertainty, and thus the risk, of investing in our securities. We anticipate that we will use substantially all of the net proceeds of any
sale of our securities within approximately six months following the completion of any sale of our securities, depending on the availability of appropriate investment opportunities
consistent with our investment objectives and market conditions. Until such appropriate investment opportunities can be found, we could also invest the net proceeds in cash, cash
equivalents, U.S. government securities and high-quality debt investments that mature in one year or less from the date of investment. We expect these temporary investments to earn
yields substantially lower than the income that we expect to receive in respect of our targeted investment types. As a result, any distributions we make during this period could be
substantially smaller than the distributions that we expect to pay when our portfolio is fully invested.
We are a non-diversified investment company within the meaning of the 1940 Act and, therefore we are not limited with respect to the proportion of our assets that could
be invested in securities of a single issuer.
We are classified as a non-diversified investment company within the meaning of the 1940 Act, which means that we are not limited by the 1940 Act with respect to the proportion of our
assets that we could invest in securities of a single issuer. To the extent that we assume large positions in the securities of a small number of issuers, our net asset value could
fluctuate to a greater extent than that of a diversified investment company as a result of changes in the financial condition or the market’s assessment of the issuer. We could also be
more susceptible to any single economic or regulatory occurrence than a diversified investment company. Beyond our asset diversification requirements as a RIC under the Code, we
do not have fixed guidelines for diversification, and our investments could be concentrated in relatively few portfolio companies. Although we are classified as a non-diversified
investment company within the meaning of the 1940 Act, we maintain the flexibility to operate as a diversified investment company and have done so for an extended period of time.
Our portfolio could be concentrated in a limited number of portfolio companies and industries, which will subject us to a risk of significant loss if any of these companies
defaults on its obligations under any of its debt instruments or if there is a downturn in a particular industry.
It is possible that our portfolio could be concentrated in a limited number of portfolio companies and industries. As a result, our interests could be impaired by the concentration of our
investments in any one obligor or obligors in a particular industry or geographic location in the event that such obligor, industry or geographic location were to
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experience adverse business conditions or other adverse events, including as a result of the effects of a global health pandemic such as the COVID-19 pandemic or during periods of
elevated inflation and rising interest rates. In addition, defaults could be highly correlated with particular obligors, industries or geographic locations. If loans involving a particular
obligor, industry or geographic location represent more than a small proportion of our portfolio, and that obligor, industry or geographic location were to experience difficulties that would
affect payments on the loans, the overall timing and amount of collections on the loans held by us could differ from what was expected.
We could hold the debt securities of leveraged companies that could, due to the significant volatility of such companies, enter into bankruptcy proceedings.
Leveraged companies could experience bankruptcy or similar financial distress, and the risk of these events would be expected to significantly increase upon the occurrence of adverse
events, including, for example, an inflationary economic environment or a global health crisis, such as the COVID-19 pandemic. The bankruptcy process has a number of significant
inherent risks. Many events in a bankruptcy proceeding are products of contested matters and adversarial proceedings and are beyond the control of the creditors. A bankruptcy filing
by an issuer could have adverse and permanent effects on the issuer. If the proceeding is converted to a liquidation, the value of the issuer will not necessarily equal the liquidation
value that was believed to exist at the time of the investment. A bankruptcy or other workout, often raises conflicts of interest (including, for example, conflicts over proposed waivers
and amendments to debt covenants), including between investors who hold different types of interests in the applicable company. 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 are 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 it owns could be reduced by increases in the number and monetary
value 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) can be substantial.
Depending on the facts and circumstances of our investments and the extent of our involvement in the management of a portfolio company, upon the bankruptcy of a portfolio
company, a bankruptcy court could recharacterize our debt investments as equity interests and subordinate all or a portion of our claim to that of other creditors. This could occur even
though we have structured our investment as senior debt.
Our failure to make follow-on investments in our portfolio companies could impair the value of our portfolio.
Following an initial investment in a portfolio company, we could make additional investments in that portfolio company as “follow-on” investments, in seeking to:
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increase or maintain in whole or in part our position as a creditor or equity ownership percentage in a portfolio company;
exercise warrants, options or convertible securities that were acquired in the original or subsequent financing; or
preserve or enhance the value of our investment.
We have discretion to make follow-on investments, subject to the availability of capital resources. Failure on our part to make follow-on investments could, in some circumstances,
jeopardize the continued viability of a portfolio company and our initial investment, or could result in a missed opportunity for us to increase our participation in a successful portfolio
company. Even if we have sufficient capital to make a desired follow-on investment, we could elect not to make a follow-on investment because we do not want to increase our level of
risk, because we prefer other opportunities or because of regulatory or other considerations. Our ability to make follow-on investments could also be limited by GC Advisors’ allocation
policy.
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Because we generally do not hold controlling equity interests in our portfolio companies, we generally will not be able to exercise control over our portfolio companies or
to prevent decisions by management of our portfolio companies that could decrease the value of our investments.
To the extent we do not hold controlling equity positions in our portfolio companies, we are subject to the risk that a portfolio company makes business decisions with which we
disagree, and that the management and/or stockholders of a portfolio company could take risks or otherwise act in ways that are adverse to our interests. Due to the lack of liquidity of
the debt and equity investments that we typically hold in our portfolio companies, we can provide no assurance that we will be able to dispose of our investments in the event we
disagree with the actions of a portfolio company and could therefore suffer a decrease in the value of our investments.
Our portfolio companies could incur debt that ranks equally with, or senior to, our investments in such companies and such portfolio companies could fail to generate
sufficient cash flow to service their debt obligations to us.
We have invested and intend to invest a portion of our capital in second lien and subordinated loans issued by our portfolio companies, and we could have exposure to a variety of debt
that captures particular layers of a borrower’s credit structure, such as “last out” or “second lien” debt, or other subordinated investments that rank below other obligations of the
borrower in right of payment. Subordinated investments are subject to greater risk of loss than senior obligations where there are adverse changes to the financial condition of the
borrower or a decline in general economic conditions. Subordinated investments could expose us to particular risks in a distress scenario, such as the risk that creditors are not aligned.
Holders of subordinated investments generally have less ability to affect the results of a distressed scenario than holders of more senior investments. Additionally, lenders to
companies operating in workout modes are, in certain circumstances, subject to potential liabilities that could exceed the amount of such loan purchased by us.
We have made in the past, and could make in the future, unsecured loans to portfolio companies, meaning that such loans will not benefit from any interest in collateral of such
companies. Liens on a portfolio company’s collateral, if any, will secure the portfolio company’s obligations under its outstanding secured debt and could secure certain future debt that
is permitted to be incurred by the portfolio company under its secured loan agreements. The holders of obligations secured by such liens will generally control the liquidation of, and be
entitled to receive proceeds from, any realization of such collateral to repay their obligations in full before us. In addition, the value of such 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 sales of such collateral would be
sufficient to satisfy our unsecured loan obligations after payment in full of all loans secured by collateral. If such proceeds were not sufficient to repay the outstanding secured loan
obligations, then our unsecured claims would rank equally with the unpaid portion of such secured creditors’ claims against the portfolio company’s remaining assets, if any.
The rights we could have with respect to the collateral securing any junior priority loans we make to our portfolio companies could also be limited pursuant to the terms of one or more
intercreditor agreements that we enter into with the holders of senior debt. Under a typical intercreditor agreement, at any time that obligations that have the benefit of the first priority
liens are outstanding, any of the following actions that could be taken in respect of the collateral will be at the direction of the holders of the obligations secured by the first priority liens:
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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 will not always have the ability to control or direct such actions, even if our rights as junior lenders are adversely affected.
The disposition of our investments could result in contingent liabilities.
A significant portion of our investments involve private securities. In connection with the disposition of an investment in private securities, we could be required to make representations
about the business and financial affairs of the portfolio company typical of those made in connection with the sale of a business. We could also be
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required to indemnify the purchasers of such investment to the extent that any such representations turn out to be inaccurate or with respect to potential liabilities. These arrangements
could result in contingent liabilities that ultimately result in funding obligations that we must satisfy through our return of payments previously received by us.
GC Advisors’ liability is limited, and we have agreed to indemnify GC Advisors against certain liabilities, which could lead GC Advisors to act in a riskier manner on our
behalf than it would when acting for its own account.
Under the Investment Advisory Agreement, and the collateral management agreements for each of the 2018 Debt Securitization, GCIC 2018 Debt Securitization and 2020 Debt
Securitization (prior to the 2020 Notes redemption), GC Advisors does not assume any responsibility to us other than to render the services called for under those agreements, and it is
not responsible for any action of our board of directors in following or declining to follow GC Advisors’ advice or recommendations. Under the terms of the Investment Advisory
Agreement, and each of the collateral management agreements GC Advisors, its officers, members, personnel and any person controlling or controlled by GC Advisors are not liable to
us, any subsidiary of ours, our directors, our stockholders or any subsidiary’s stockholders or partners for acts or omissions performed in accordance with and pursuant to the
Investment Advisory Agreement, and the collateral management agreements, except those resulting from acts constituting gross negligence, willful misconduct, bad faith or reckless
disregard of GC Advisors’ duties under the Investment Advisory Agreement, and the collateral management agreements. In addition, we have agreed to indemnify GC Advisors and
each of its officers, directors, members, managers and employees 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 Investment Advisory Agreement, and
the collateral management agreements, except where attributable to gross negligence, willful misconduct, bad faith or reckless disregard of such person’s duties under the Investment
Advisory Agreement, and the collateral management agreements. These protections could lead GC Advisors to act in a riskier manner when acting on our behalf than it would when
acting for its own account.
We could be subject to risks related to investments in non-U.S. companies.
We have invested and continue to make investments in issuers located outside the United States. Investments in issuers located outside the United States that are generally
denominated in non-U.S. currencies involve both risks and opportunities not typically associated with investing in securities of United States companies. The legal and regulatory
environments often have material differences, particularly as to bankruptcy and reorganization. Other considerations include changes in exchange rates and exchange control
regulations, political and social instability, general economic conditions, expropriation, imposition of non-U.S. taxes, less liquid markets and less available information than is generally
the case in the United States, higher transaction costs, foreign government restrictions, less government supervision of exchanges, brokers and issuers, greater risks associated with
counterparties and settlement, less developed bankruptcy laws, difficulty in enforcing contractual obligations, lack of uniform accounting and auditing standards and greater price
volatility. Among the factors that could affect currency values are trade balances, the level of short-term interest rates, differences in relative values of similar assets in different
currencies, long-term opportunities for investment and capital appreciation and political developments. We could employ hedging techniques to minimize these risks, but we cannot
assure you that such strategies will be effective or without risk to us. As of September 30, 2023, we were invested in securities of thirty-eight non-U.S. companies. Securities issued by
non-U.S. companies are not “qualifying assets” under the 1940 Act, and we could invest in non-U.S. companies, including emerging markets issuers, to the limited extent such
investments are permitted under the 1940 Act.
We could be subject to risks if we engage in hedging transactions and could become subject to risks if we invest in foreign securities.
Under the 1940 Act, a business development company is restricted from acquiring any asset other than assets of the type listed in the 1940 Act, which are referred to as “qualifying
assets,” unless, at the time the acquisition is made, qualifying assets represent at least 70% of the company’s total assets. In order for our investments to be classified as “qualifying
assets,” among other requirements, such investments must be in issuers organized under the laws of, and which have their principal place of business in, any state of the United
States, the District of Columbia, Puerto Rico, the Virgin Islands or any other possession of the United States.
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We can invest in non-U.S. companies, including emerging market issuers, to the limited extent such investments are permitted under the 1940 Act. We expect that these investments
would focus on the same types of investments that we make in U.S. middle-market companies and accordingly would be complementary to our overall strategy and enhance the
diversity of our holdings. Investing in securities of emerging market issuers involves many risks including economic, social, political, financial, tax and security conditions in the
emerging market, potential inflationary economic environments, regulation by foreign governments, different accounting standards and political uncertainties. Economic, social, political,
financial, tax and security conditions also could negatively affect the value of emerging market companies. These factors could include changes in the emerging market government’s
economic and fiscal policies, the possible imposition of, or changes in, currency exchange laws or other laws or restrictions applicable to the emerging market companies or
investments in their securities and the possibility of fluctuations in the rate of exchange between currencies. Any of our portfolio company investments that are denominated in foreign
currencies will be subject to the risks associated with fluctuations in currency exchange rates, which fluctuations could adversely affect our performance.
We have and could in the future enter into hedging transactions to the limited extent such transactions are permitted under the 1940 Act and applicable commodities laws. Engaging in
hedging transactions or investing in foreign securities would entail additional risks to our stockholders. We could, for example, use instruments such as interest rate swaps, caps,
collars and floors and, if we were to invest in foreign securities, we could use instruments such as forward contracts or currency options in currencies selected to hedge against
fluctuations in the relative values of our portfolio positions from changes in currency exchange rates and market interest rates. We could also, for example, borrow under a credit facility
in currencies selected to minimize our foreign currency exposure. Use of these hedging instruments could include counterparty credit risk. In each such case, we generally would seek
to hedge against fluctuations of the relative values of our portfolio positions from changes in market interest rates or currency exchange rates. While hedging transactions can reduce
such risks, they generally will not be designed to prevent all loss from our position. There also could be barriers that prevent us from entering into certain hedging transactions. These
barriers will not necessarily impact other investment funds managed by GC Advisors or its affiliates. Hedging transactions could result in a lower overall performance for us than if it
had not entered into hedging transactions and generally introduces new risks, such as counterparty risk and greater illiquidity. In addition, we are permitted to borrow funds in one or
more foreign currencies as a form of protection against currency risk. The use of such financing could create new risks not traditionally associated with credit facilities or other forms of
leverage. Conversely, to the extent that we do not enter into hedging transactions, borrower defaults and fluctuations in currency exchange rates or interest rates could result in poorer
overall performance for us than if it had entered into such hedging transactions.
The success of any hedging transactions that we enter into will depend on our ability to correctly predict movements in currency and interest rates. Therefore, while we could enter into
hedging transactions to seek to reduce currency exchange rate and interest rate risks, unanticipated changes in currency exchange rates or interest rates could result in poorer overall
investment performance than if we had not engaged in any such hedging transactions. In addition, the degree of correlation between price movements of the instruments used in a
hedging strategy and price movements in the portfolio positions being hedged could vary. Moreover, for a variety of reasons, we would not necessarily seek to (or be able to) establish
a perfect correlation between the hedging instruments and the portfolio holdings being hedged. Any such imperfect correlation could prevent us from achieving the intended hedge and
expose us to risk of loss. In addition, it is often not possible to hedge fully or perfectly against currency fluctuations affecting the value of securities denominated in non-U.S. currencies
because the value of those securities would likely fluctuate as a result of factors not related to currency fluctuations. Our ability to engage in hedging transactions could also be limited
under the Code as well as adversely affected by rules adopted by the CFTC.
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We could suffer losses from our equity investments.
While our investment portfolio will be focused on loans, we are also permitted to invest in equity securities. Such investments are expected to represent minority ownership in the issuer
and are subordinate to the claims of the issuer’s creditors and, to the extent such securities are common securities, to preferred equity holders. The value of equity securities is
dependent on the performance of the issuer and can fluctuate based on the issuer’s financial performance, market conditions, and overall economic conditions. Dividends paid to
equity holders could be suspended or cancelled at any time, and minority owners could have limited protections. We also could be unable to realize any value if a portfolio company
does not have a liquidity event, such as a sale of the business, recapitalization or public offering, which would allow us to sell our underlying equity interests. In addition, if an issuer of
equity securities in which we have invested sells additional shares of its equity securities, our interest in the issuer will be diluted and the value of our investment could decrease. For
the foregoing reasons, investments in equity securities can be highly speculative and carry a substantial risk of loss of investment. Investments in equity securities can carry additional
risks or have other characteristics that require different structuring. As such, these investments can be made directly, or indirectly through blocker entities or otherwise.
We could be subject to lender liability claims with respect to our portfolio company investments.
A number of judicial decisions have upheld judgments for borrowers against lending institutions on the basis of various legal theories, collectively termed “lender liability.” Generally,
lender liability is founded on the premise that a lender has violated a duty (whether implied or contractual) of good faith, commercial reasonableness and fair dealing or a similar duty
owed to the borrower, or has assumed an excessive degree of control over the borrower resulting in the creation of a fiduciary duty owed to the borrower or its other creditors or
stockholders. We could be required to defend allegations of lender liability from time to time.
Loans to companies operating in workout modes or under Chapter 11 of the U.S. Bankruptcy Code are, in certain circumstances, subject to certain potential liabilities that could exceed
the amount of such loan purchased by us. Under common law principles that in some cases form the basis for lender liability claims, if a lender or bondholder (i) intentionally takes an
action that results in the undercapitalization of a borrower to the detriment of other creditors of such borrower, (ii) engages in other inequitable conduct to the detriment of such other
creditors, (iii) engages in fraud with respect to, or makes misrepresentations to, such other creditors or (iv) uses its influence as a stockholder to dominate or control a borrower to the
detriment of other creditors of such borrower, a court could elect to subordinate the claim of the offending lender or bondholder to the claims of the disadvantaged creditor or creditors, a
remedy called “equitable subordination.” Because of the nature of the loans, the loans could be subject to claims of subordination.
Risks Relating to Investors in Our Securities
Investing in our securities could involve an above average degree of risk.
The investments we make in accordance with our investment objective could 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 securities may not be suitable for someone with a lower risk tolerance.
Shares of closed-end investment companies, including business development companies, often trade at a discount to their net asset value.
Shares of closed-end investment companies, including business development companies, could trade at a discount from net asset value. This characteristic of closed-end investment
companies and business development companies is separate and distinct from the risk that our net asset value per share could decline. We cannot predict whether our common stock
will trade at, above or below net asset value.
There is a risk that investors in our equity securities will not receive distributions or that our distributions will not grow over time and a portion of our distributions could
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. Our ability to pay distributions could be adversely affected by the impact of
one or more of the risk
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factors described in this Annual Report on Form 10-K as well as any amendments reflected in subsequent filings with the SEC. Due to the asset coverage test applicable to us under
the 1940 Act as a business development company, we could be limited in our ability to make distributions. In addition, all distributions are and will be paid at the discretion of our board
of directors and will depend on our earnings, financial condition, maintenance of our RIC status, compliance with applicable business development company regulations and such other
factors as our board of directors could deem relevant from time to time. If we declare a distribution and if more stockholders opt to receive cash distributions rather than participate in
our dividend reinvestment plan, we could be forced to sell some of our investments in order to make cash distribution payments. In the event that we encounter delays in locating
suitable investment opportunities, we could also pay all or a substantial portion of our distributions from the proceeds of private placements of our common stock or from borrowings in
anticipation of future cash flow, which could constitute a return of stockholders’ capital. To the extent we make distributions to stockholders that include a return of capital, such portion
of the distribution essentially constitutes a return of the stockholder’s investment. Although such return of capital is generally not currently taxable, such distributions would generally
decrease a stockholder’s basis in our common stock and could therefore increase such stockholder’s tax liability for capital gains upon the future sale or other disposition of such
common stock. A return of capital distribution could cause a stockholder to recognize a capital gain from the sale of our common stock even if the stockholder sells its shares for less
than the original purchase price. Distributions from borrowings could also reduce the amount of capital we ultimately invest in our portfolio companies.
We have not established any limit on the amount of funds we can use from available sources, such as borrowings, if any, or proceeds from private placements of our
common stock, to fund distributions (which could reduce the amount of capital we ultimately invest in assets).
Any distributions made from sources other than cash flow from operations or relying on fee or expense reimbursement waivers, if any, from GC Advisors or the Administrator are not
based on our investment performance, and can only be sustained if we achieve positive investment performance in future periods and/or GC Advisors or the Administrator continues to
make such expense reimbursements, if any. The extent to which we pay distributions from sources other than cash flow from operations will depend on various factors, including the
level of participation in our dividend reinvestment plan, how quickly we invest the proceeds from any offerings of our securities and the performance of our investments. There can be
no assurance that we will achieve such performance in order to sustain any level of distributions, or be able to pay distributions at all. GC Advisors and the Administrator have no
obligation to waive fees or receipt of expense reimbursements, if any.
The market price of our securities could fluctuate significantly.
The market price and liquidity of the market for our securities could be significantly affected by numerous factors, some of which are beyond our control and may not be directly related
to our operating performance. These factors include:
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significant volatility in the market price and trading volume of securities of business development companies or other companies in our sector, which are not necessarily related
to the operating performance of the companies;
changes in regulatory policies, accounting pronouncements or tax guidelines, particularly with respect to RICs and business development companies;
loss of our qualification as a RIC or business development company;
changes in market interest rates and decline in the prices of debt,
changes in earnings or variations in operating results;
changes in the value of our portfolio investments;
changes in accounting guidelines governing valuation of our investments;
any shortfall in revenue or net income or any increase in losses from levels expected by investors or securities analysts;
departure of GC Advisors’ or any of its affiliates’ key personnel;
operating performance of companies comparable to us;
general economic trends and other external factors; and
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loss of a major funding source.
The Unsecured Notes are unsecured and therefore are effectively subordinated to any secured indebtedness we have incurred or could incur in the future.
The Unsecured Notes are not secured by any of our assets or any of the assets of our subsidiaries. As a result, the Unsecured Notes are effectively subordinated, or junior, to any
secured indebtedness or other obligations we or our subsidiaries have outstanding as of the date of issuance of the Unsecured Notes or that we or our subsidiaries could incur in the
future (or any indebtedness that is initially unsecured in respect of which we subsequently grant security) to the extent of the value of the assets securing such indebtedness. A
substantial portion of our assets are currently pledged as collateral under the Debt Securitizations and Revolving Credit Facilities. In any liquidation, dissolution, bankruptcy or other
similar proceeding, the holders of any of our existing or future secured indebtedness and the secured indebtedness of our subsidiaries could assert rights against the assets pledged to
secure that indebtedness in order to receive full payment of their indebtedness before the assets could be used to pay other creditors, including the holders of the Unsecured Notes. As
of September 30, 2023, we had an aggregate of approximately $1.7 billion of outstanding borrowings under the Debt Securitizations and the Revolving Credit Facilities, all of which are
secured and thus effectively senior to the Unsecured Notes.
The Unsecured Notes are structurally subordinated to the indebtedness and other liabilities of our
subsidiaries.
The Unsecured Notes are obligations exclusively of Golub Capital BDC, Inc. and not of any of our subsidiaries. None of our subsidiaries is a guarantor of the Unsecured Notes and the
Unsecured Notes are not required to be guaranteed by any subsidiaries we could acquire or create in the future. The assets of such subsidiaries are not directly available to satisfy the
claims of our creditors, including holders of the Unsecured Notes.
Except to the extent we are a creditor with recognized claims against our subsidiaries, all claims of creditors (including trade creditors) and holders of preferred stock, if any, of our
subsidiaries will have priority over our equity interests in such subsidiaries (and therefore the claims of our creditors, including holders of the Unsecured Notes) with respect to the
assets of such subsidiaries. Even if we are recognized as a creditor of one or more of our subsidiaries, our claims would still be effectively subordinated to any security interests in the
assets of any such subsidiary and to any indebtedness or other liabilities of any such subsidiary senior to our claims. Consequently, the Unsecured Notes are structurally subordinated,
or junior, to the Debt Securitizations, the Revolving Credit Facilities and other liabilities (including trade payables) incurred by any of our existing or future subsidiaries, financing
vehicles or similar facilities. All of the existing indebtedness of our subsidiaries is structurally senior to the Unsecured Notes.
In addition, our subsidiaries and any additional subsidiaries that we could form could incur substantial additional
indebtedness in the future, all of which would be structurally senior to the Unsecured Notes.
The indenture governing the Unsecured Notes contains limited protection for holders of the Unsecured Notes.
The indenture governing the Unsecured Notes offers limited protection to holders of the Unsecured
Notes. The terms of the indenture and the Unsecured Notes do not restrict our or any of our subsidiaries’ ability to engage in, or otherwise be a party to, a variety of corporate
transactions, circumstances or events that could have a material adverse impact on an investment in the Unsecured Notes. In particular, the terms of the indenture and the Unsecured
Notes do not place any restrictions on our or our subsidiaries’ ability to:
•
issue securities or otherwise incur additional indebtedness or other obligations, including (1) any indebtedness or other obligations that would be pari-passu, or equal, in right of
payment to the Unsecured Notes, (2) any indebtedness or other obligations that would be secured and therefore rank effectively senior in right of payment to the Unsecured
Notes to the extent of the value of the assets securing such indebtedness, (3) indebtedness or other obligations of ours that are guaranteed by one or more of our subsidiaries
and which therefore are structurally senior to the Unsecured Notes and (4) securities, indebtedness or other obligations issued or incurred by our subsidiaries that would be
senior to our equity interests in our subsidiaries and therefore rank structurally senior to the Unsecured Notes with respect to the assets of our subsidiaries, in each case other
than an incurrence of indebtedness or other obligations that would cause a violation of Section 18(a)(1)(A) of the 1940 Act as modified by Section 61(a)(1) and (2) of the 1940
Act or any successor provisions, as such obligations could be amended or superseded, giving effect to any exemptive relief granted to us by the SEC. Currently, these
provisions generally prohibit us
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from incurring additional borrowings, including through the issuance of additional debt securities, unless our asset coverage, as defined in the 1940 Act, equals at least 150%
after such borrowings;
pay dividends on, or purchase or redeem or make any payments in respect of, capital stock or other securities ranking junior in right of payment to the Unsecured Notes;
sell assets (other than certain limited restrictions on our ability to consolidate, merge or sell all or substantially all of our assets);
enter into transactions with affiliates;
create liens (including liens on the shares of our subsidiaries) or enter into sale and leaseback transactions;
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• make investments; or
•
create restrictions on the payment of dividends or other amounts to us from our subsidiaries.
Furthermore, the terms of the indenture and the Unsecured Notes do not protect holders of the Unsecured Notes in the event that we experience changes (including significant adverse
changes) in our financial condition, results of operations or credit ratings, as they do not require that we or our subsidiaries adhere to any financial tests or ratios or specified levels of
net worth, revenues, income, cash flow or liquidity other than certain events of default under the indenture governing the Unsecured Notes.
Our ability to recapitalize, incur additional debt and take a number of other actions are not limited by the terms of the Unsecured Notes and could have important consequences for
holders of the Unsecured Notes, including making it more difficult for us to satisfy our obligations with respect to the Unsecured Notes or negatively affecting the trading value of the
Unsecured Notes.
Certain of our current debt instruments include more protections for their holders than the indenture and the
Unsecured Notes. In addition, other debt we issue or incur in the future could contain more protections for its
holders than the indenture and the Unsecured Notes, including additional covenants and events of default. The
issuance or incurrence of any such debt with incremental protections could affect the market for and trading levels
and prices of the Unsecured Notes.
If an active trading market for the Unsecured Notes does not develop, holders may not be able to resell them.
The Unsecured Notes could or could not have an active trading market. We do not intend to apply for listing of the Unsecured Notes on any securities exchange or for quotation of the
Unsecured Notes on any automated dealer quotation system. If no active trading market develops, holders may not be able to resell the Unsecured Notes at their fair market value or
at all. If the Unsecured Notes are traded after their initial issuance, they could trade at a discount from their initial offering price depending on prevailing interest rates, the market for
similar securities, our credit ratings, general economic conditions, our financial condition, performance and prospects and other factors. Any market-making activity will be subject to
limits imposed by law. Accordingly, we cannot assure you that a liquid trading market will develop for the Unsecured Notes, that holders will be able to sell the Unsecured Notes at a
particular time or that the price received when sold will be favorable. To the extent an active trading market does not develop, the liquidity and trading price for the Unsecured Notes
could be harmed. Accordingly, holders could be required to bear the financial risk of an investment in the Unsecured Notes for an indefinite period of time.
If we default on our obligations to pay our other indebtedness, we could not be able to make payments on the Unsecured Notes.
Any default under the agreements governing our indebtedness, including the Debt Securitizations, the Revolving Credit Facilities or other indebtedness to which we are a party that is
not waived by the required lenders or holders, and the remedies sought by the holders of such indebtedness could make us unable to pay principal, premium, if any, and interest on the
Unsecured Notes and substantially decrease the market value of the Unsecured Notes.
If we are unable to generate sufficient cash flow and are otherwise unable to obtain funds necessary to meet required
payments of principal, premium, if any, and interest on our indebtedness, or if we otherwise fail to comply with the various covenants, including financial and operating covenants, in the
instruments governing our indebtedness, we could be in default under the terms of the agreements governing such indebtedness. In the event of such default, the holders of such
indebtedness could elect to
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declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest, the lenders under the Revolving Credit Facilities or other debt we could
incur in the future could elect to terminate their commitments, cease making further loans and institute foreclosure proceedings against our assets, and we could be forced into
bankruptcy or liquidation.
If our operating performance declines, we could in the future need to seek to obtain waivers from the required lenders under the Revolving Credit Facilities or the required holders of
the Debt Securitizations or other debt that we could incur in the future, to avoid being in default. If we breach our covenants under the Debt Securitizations, the Revolving Credit
Facilities or other debt and seek a waiver, we could not be able to obtain a waiver from the required lenders or holders. If this occurs, we would be in default and our lenders or debt
holders could exercise their rights as described above, and we could be forced into bankruptcy or liquidation.
If we are unable to repay debt, lenders or holders having secured obligations, including the lenders and holders under the Debt Securitizations and the Revolving Credit Facilities could
proceed against the collateral securing the debt. Because the Revolving Credit Facilities have, and any future credit facilities will likely have, customary cross-default provisions, if the
indebtedness thereunder or under any future credit facility is accelerated, we could be unable to repay or finance the amounts due. In the event holders of any debt securities we have
outstanding exercise their rights to accelerate following a cross-default, those holders would be entitled to receive the principal amount of their investment, subject to any subordination
arrangements that could be in place. We cannot assure you that we will have sufficient liquidity to be able to repay such amounts, in which case we would be in default under the
accelerated debt and holders would have the ability to sue us to recover amounts then owing.
A downgrade, suspension or withdrawal of the credit rating assigned by a rating agency to us or the Unsecured Notes, if any, or change in the debt markets, could cause
the liquidity or market value of the Unsecured Notes to decline significantly.
Our credit ratings are an assessment by rating agencies of our ability to pay our debts when due. Consequently, real or anticipated changes in our credit ratings will generally affect the
market value of the Unsecured Notes or other debt securities we could issue. These credit ratings may not reflect the potential impact of risks relating to the structure or marketing of
the Unsecured Notes. Credit ratings are not a recommendation to buy, sell or hold any security, and could be revised or withdrawn at any time by the issuing organization in its sole
discretion. Neither we nor any underwriter undertakes any obligation to maintain our credit ratings or to advise holders of the Unsecured Notes of any changes in our credit ratings.
An increase in market interest rates could result in a decrease in the market value of the Unsecured Notes.
The condition of the financial markets and prevailing interest rates have fluctuated in the past and are likely to fluctuate in the future, which could have an adverse effect on the market
prices of the Unsecured Notes. In general, as market interest rates rise, debt securities bearing interest at fixed rates of interest decline in value. Consequently, if market interest rates
increase, the market values of the Unsecured Notes with fixed interest rates could decline. We cannot predict the future level of market interest rates.
The optional redemption provision could materially adversely affect the return on the Unsecured Notes.
The Unsecured Notes are redeemable in whole or in part upon certain conditions at any time or from time to time at our option. We could choose to redeem the Unsecured Notes at
times when prevailing interest rates are lower than the interest rate paid on the Unsecured Notes. In this circumstance, holders may not be able to reinvest the redemption proceeds in
a comparable security at an effective interest rate as high as the Unsecured Notes being redeemed.
We could be unable to repurchase the Unsecured Notes upon a Change of Control Repurchase Event.
We could be unable to repurchase the Unsecured Notes upon a Change of Control Repurchase Event (as defined in the indenture governing the Unsecured Notes) if we do not have
sufficient funds. Upon a Change of Control Repurchase Event, holders of the Unsecured Notes could require us to repurchase for cash some or all of the Unsecured Notes at a
repurchase price equal to 100% of the aggregate principal amount of the Unsecured Notes being repurchased, plus accrued and unpaid interest to, but not including, the repurchase
date. Our failure to purchase such tendered Unsecured Notes upon the occurrence of such Change of Control Repurchase Event would cause an event of default under the indenture
governing the Unsecured Notes and a cross-default under the agreements governing certain of our other indebtedness, which could result in the acceleration of such indebtedness
requiring us to repay that indebtedness immediately.
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We are a holding company and depend on payments from our subsidiaries in order to make payments on any debt securities that we could issue as well as to pay
distributions on our common stock. Any debt securities that we issue will be structurally subordinated to the obligations of our subsidiaries.
We are a holding company and fund a majority of our investments through wholly-owned subsidiaries, and a majority of the assets that we hold directly are the equity interests in such
subsidiaries, including any subordinated notes issued as part of our debt securitization transactions, which notes represent the residual claimant on distributions by the applicable
securitization subsidiary. We depend upon the cash flow from our subsidiaries and the receipt of funds from them in the form of payments on any subordinated notes, dividends, and
other distributions, any of which could be subject to restriction or limitations based on the organizational documents of the subsidiaries and the agreements governing the debt of any
such subsidiary. In addition, because we are a holding company, any debt securities that we issue will be structurally subordinated to the obligations of our subsidiaries. In the event
that one of our subsidiaries becomes insolvent, liquidates, reorganizes, dissolves or otherwise winds up, its assets will be used first to satisfy the claims of its creditors. Consequently,
any claim by us or our creditors, including holders of any debt securities that we could issue, against any subsidiary will be structurally subordinated to all of the claims of the creditors
of such subsidiary. We cannot assure security holders that they will receive any payments required to be made under the terms of any debt securities that we could issue, dividends or
other distributions.
Holders of any preferred stock that we could issue will have the right to elect members of the board of directors and have class voting rights on certain matters.
The 1940 Act requires that holders of shares of preferred stock must be entitled as a class to elect two directors at all times and to elect a majority of the directors if dividends on such
preferred stock are in arrears by two years or more, until such arrearage is eliminated. In addition, certain matters under the 1940 Act require the separate vote of the holders of any
issued and outstanding preferred stock, including changes in fundamental investment restrictions and conversion to open-end status and, accordingly, preferred stockholders could
veto any such changes. Restrictions imposed on the declarations and payment of dividends or other distributions to the holders of our common stock and preferred stock, both by the
1940 Act and by requirements imposed by rating agencies, might impair our ability to maintain our qualification as a RIC for U.S. federal income tax purposes.
Our common stockholders’ interest in us could be diluted if they do not fully exercise subscription rights in any rights offering. In addition, if the subscription price is
less than our net asset value per share, then common stockholders will experience an immediate dilution of the aggregate net asset value of their shares.
In the event we issue subscription rights, stockholders who do not fully exercise their subscription rights should expect that they will, at the completion of a rights offering, own a smaller
proportional interest in us than would otherwise be the case if they fully exercised their rights. We cannot state precisely the amount of any such dilution in share ownership because
we do not know at this time what proportion of the shares would be purchased as a result of such rights offering.
In addition, if the subscription price is less than the net asset value per share of our common stock, then our common stockholders would experience an immediate dilution of the
aggregate net asset value of their shares as a result of the offering. The amount of any decrease in net asset value is not predictable because it is not known at this time what the
subscription price and net asset value per share will be on the expiration date of a rights offering or what proportion of the shares will be purchased as a result of such rights offering.
Such dilution could be substantial.
These dilutive effects could be exacerbated if we were to conduct multiple subscription rights offerings, particularly if such offerings were to occur over a short period of time. In addition,
subscription rights offerings and the prospect of future subscription rights offerings could create downward pressure on the secondary market price of our common stock due to the
potential for the issuance of shares at a price below our net asset value, without a corresponding change to our net asset value.
Our stockholders will experience dilution in their ownership percentage if they do not participate in our dividend reinvestment plan.
All distributions declared in cash payable to stockholders that are participants in our dividend reinvestment plan are automatically reinvested in shares of our common stock. As a result,
our stockholders that do not participate in our dividend reinvestment plan will experience dilution in their ownership percentage of our common stock over time.
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Our stockholders could receive shares of our common stock as dividends, which could result in adverse tax consequences to them.
Although we currently do not intend to do so, we are permitted to declare a large portion of a dividend in shares of common stock instead of cash at the election of each stockholder.
Revenue Procedures issued by the IRS allow a publicly offered regulated investment company (such as us) to distribute its own stock as a dividend for the purpose of fulfilling its
distribution requirements, if certain conditions are satisfied. Among other things, the aggregate amount of cash available to be distributed to all stockholders is required to be at least
10% of the total distribution, for distributions declared on or before December 31, 2022 and at least 20% of the aggregate declared distribution for distributions declared on or after
January 1, 2023. The Internal Revenue Service has also issued private letter rulings on cash/stock dividends paid by RICs and real estate investment trusts where the cash component
is limited to 20% of the total distribution if certain requirements are satisfied. Stockholders receiving such dividends will be required to include the full amount of the dividend (including
the portion payable in stock) as ordinary income (or, in certain circumstances, long-term capital gain) to the extent of our current and accumulated earnings and profits for federal
income tax purposes. As a result, stockholders could be required to pay income taxes with respect to such dividends in excess of the cash dividends received. It is unclear to what
extent we will be able to pay taxable dividends in cash and common stock (whether pursuant to IRS Revenue Procedures, a private letter ruling or otherwise).
Sales of substantial amounts of our common stock in the public market could have an adverse effect on the market price of our common stock.
Sales of substantial amounts of our common stock, or the availability of such common stock for sale, could adversely affect the prevailing market prices for our common stock. If this
occurs and continues, it could impair our ability to raise additional capital through the sale of securities should we desire to do so.
The trading market or market value of our publicly issued debt securities could fluctuate.
Any publicly issued debt securities we issue will not necessarily have an established trading market. We cannot assure you that a trading market for our publicly issued debt securities
will ever develop or be maintained if developed. In addition to our creditworthiness, many factors could materially adversely affect the trading market for, and market value of, our
publicly issued debt securities. These factors include, but are not limited to, the following:
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the time remaining to the maturity of these debt securities;
the outstanding principal amount of debt securities with terms identical to these debt securities;
the ratings assigned by national statistical ratings agencies;
the general economic environment;
the supply of debt securities trading in the secondary market, if any;
the redemption or repayment features, if any, of these debt securities;
the level, direction and volatility of market interest rates generally; and
• market rates of interest higher or lower than rates borne by the debt securities.
Investors should also be aware that there could be a limited number of buyers when they decide to sell our debt securities. This too could materially adversely affect the market value of
the debt securities or the trading market for the debt securities.
Terms relating to redemption could materially adversely affect the return on any debt securities that we could issue.
If we issue debt securities that are redeemable at our option, we could choose to redeem such debt securities at times when prevailing interest rates are lower than the interest rate
paid on the debt securities. In addition, if our debt securities are subject to mandatory redemption, we could be required to redeem such debt securities also at times when prevailing
interest rates are lower than the interest rate paid on the debt securities. In this circumstance, investors in our debt securities may not be able to reinvest the redemption proceeds in a
comparable security at an effective interest rate as high as the debt securities being redeemed.
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If we issue preferred stock, debt securities or convertible debt securities, the net asset value and market value of
our common stock could become more volatile.
We cannot assure you that the issuance of preferred stock and/or debt securities would result in a higher yield or return to the holders of our common stock. The issuance of preferred
stock, debt securities or convertible debt would likely cause the net asset value and market value of our common stock to become more volatile. If the dividend rate on the preferred
stock, or the interest rate on the debt securities, were to approach the net rate of return on our investment portfolio, the benefit of leverage to the holders of our common stock would be
reduced. If the dividend rate on the preferred stock, or the interest rate on the debt securities, were to exceed the net rate of return on our portfolio, the use of leverage would result in a
lower rate of return to the holders of our common stock than if we had not issued the preferred stock or debt securities. Any decline in the net asset value of our investment would be
borne entirely by the holders of our common stock. Therefore, if the market value of our portfolio were to decline, the leverage would result in a greater decrease in net asset value to
the holders of our common stock than if we were not leveraged through the issuance of preferred stock. This decline in net asset value would also tend to cause a greater decline in
the market price for our common stock.
There is also a risk that, in the event of a sharp decline in the value of our net assets, we would be in danger of failing to maintain required asset coverage ratios which could be
required by the preferred stock, debt securities, convertible debt or units or of a downgrade in the ratings of the preferred stock, debt securities, convertible debt or units or our current
investment income might not be sufficient to meet the dividend requirements on the preferred stock or the interest payments on the debt securities. In order to counteract such an
event, we might need to liquidate investments in order to fund redemption of some or all of the preferred stock, debt securities or convertible debt. In addition, we would pay (and the
holders of our common stock would bear) all costs and expenses relating to the issuance and ongoing maintenance of the preferred stock, debt securities, convertible debt or any
combination of these securities. Holders of preferred stock, debt securities or convertible debt could have different interests than holders of common stock and could at times have
disproportionate influence over our affairs.
Our stock repurchase program could affect the price of our common stock and increase volatility and may be suspended or terminated at any time, which may result in a
decrease in the trading price of our common stock.
Our board of directors most recently approved our share repurchase program (the “Program”) in August 2023, under which we can repurchase up to $150 million of our outstanding
common stock. Under the Program, purchases can be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities
laws and regulations, at prices below our NAV as reported in our most recently published consolidated financial statements. We have in the past, and could in the future, enter into a
plan to repurchase shares of our common stock pursuant to the Program in a manner intended to comply with the requirements of Rule 10b5-1 under the Exchange Act.
The Program is discretionary and whether purchases will be made under the Program and how much will be purchased at any time is uncertain and dependent on prevailing market
prices and trading volumes, all of which we cannot predict. These activities could have the effect of maintaining the market price of our common stock or retarding a decline in the
market price of the common stock, and, as a result, the price of our common stock could be higher than the price that otherwise might exist in the open market. Repurchases pursuant
to the Program could affect the price of our common stock and increase its volatility. The existence of the Program could also cause the price of our common stock to be higher than it
would be in the absence of such a program and could potentially reduce the market liquidity for our common stock. There can be no assurance that any stock repurchases will
enhance stockholder value because the market price of our common stock could decline below the levels at which we repurchased such shares. Any failure to repurchase shares after
we have announced our intention to do so could negatively impact our reputation and investor confidence in us and could negatively impact our stock price. Although the Program is
intended to enhance long-term stockholder value, short-term stock price fluctuations could reduce the Program’s effectiveness.
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General Risk Factors
We are currently in a period of capital markets disruption and economic uncertainty.
The success of our activities is affected by general economic and market conditions, including, among others, interest rates, availability of credit, inflation rates, economic uncertainty,
changes in laws, and trade barriers. These factors could affect the level and volatility of securities prices and the liquidity of our investments. Volatility or illiquidity could impair our
profitability or result in losses. These factors also could adversely affect the availability or cost of our leverage, which would result in lower returns.
In recent years, U.S. capital markets have experienced volatility and disruptions including as a result of the COVID-19 pandemic, certain regional bank failures, and an inflationary
economic environment. These disruptions in the capital markets have in the past and could in the future increase the spread between the yields realized on risk-free and higher risk
securities, resulting in illiquidity in parts of the capital markets. Such disruptions could adversely affect our business, financial condition, results of operations and cash flows, and future
market disruptions and/or illiquidity could negatively impact us. These unfavorable economic conditions could increase our funding costs and limit our access to the capital markets, and
could result in a decision by lenders not to extend credit to us in the future. These events could limit our investments, our ability to grow and could negatively impact our operating
results and the fair values of our debt and equity investments.
Events outside of our control, including public health crises, could negatively affect our portfolio companies, our investment adviser and the results of our operations.
Periods of market volatility could occur in response to pandemics or other events outside of our control. We, GC Advisors, and the portfolio companies in which we invest in could be
affected by force majeure events (i.e., events beyond the control of the party claiming that the event has occurred, such as acts of God, fire, flood, earthquakes, outbreaks of an
infectious disease, pandemic or any other serious public health concern, war, terrorism, labor strikes, government shutdowns, major plant breakdowns, pipeline or electricity line
ruptures, failure of technology, defective design and construction, accidents, demographic changes, government macroeconomic policies, social instability, etc.). Some force majeure
events could adversely affect the ability of a party (including us, GC Advisors, a portfolio company or a counterparty to us, GC Advisors, or a portfolio company) to perform its
obligations until it is able to remedy the force majeure event. In addition, force majeure events, such as the cessation of the operation of equipment for repair or upgrade, could similarly
lead to the unavailability of essential equipment and technologies. These risks could, among other effects, adversely impact the cash flows available from a portfolio company, cause
personal injury or loss of life, including to a senior manager of GC Advisors or its affiliates, damage property, or instigate disruptions of service. In addition, the cost to a portfolio
company or us of repairing or replacing damaged assets resulting from such force majeure event could be considerable. It will not be possible to insure against all such events, and
insurance proceeds received, if any, could be inadequate to completely or even partially cover any loss of revenues or investments, any increases in operating and maintenance
expenses, or any replacements or rehabilitation of property. Certain events causing catastrophic loss could be either uninsurable, or insurable at such high rates as to adversely impact
us, GC Advisors, or portfolio companies, as applicable. Force majeure events that are incapable of or are too costly to cure could have permanent adverse effects. Certain force
majeure events (such as war or an outbreak of an infectious disease) could have a broader negative impact on the world economy and international business activity generally, or in
any of the countries in which we invest or our portfolio companies operate specifically. Such force majeure events could result in or coincide with: increased volatility in the global
securities, derivatives and currency markets; a decrease in the reliability of market prices and difficulty in valuing assets; greater fluctuations in currency exchange rates; increased risk
of default (by both government and private issuers); further social, economic, and political instability; nationalization of private enterprise; greater governmental involvement in the
economy or in social factors that impact the economy; less governmental regulation and supervision of the securities markets and market participants and decreased monitoring of the
markets by governments or self-regulatory organizations and reduced enforcement of regulations; limited, or limitations on, the activities of investors in such markets; controls or
restrictions on foreign investment, capital controls and limitations on repatriation of invested capital; inability to purchase and sell investments or otherwise settle security or derivative
transactions (i.e., a market freeze); unavailability of currency hedging techniques; substantial, and in some periods extremely high, rates of inflation, which can last many years and
have substantial negative effects on credit and securities markets as well as the economy as a whole; recessions; and difficulties in obtaining and/or enforcing legal judgments.
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Additionally, a major governmental intervention into industry, including the nationalization of an industry or the assertion of control over one or more portfolio companies or its assets,
could result in a loss to us, including if the investment in such portfolio companies is canceled, unwound or acquired (which could result in inadequate compensation). Any of the
foregoing could therefore adversely affect the performance of us and our investments.
We could experience fluctuations in our quarterly operating results.
We could experience fluctuations in our quarterly operating results due to a number of factors, including the interest rate payable on any borrowings and the interest rate payable on the
debt securities we acquire, the default rate on such securities, the number and size of investments we originate or acquire, the level of our expenses, variations in and the timing of the
recognition of realized and unrealized gains or losses, the degree to which we encounter competition in our markets and general economic conditions. In light of these factors, results
for any period should not be relied upon as being indicative of our performance in future periods.
Political uncertainty could adversely affect our business.
U.S. and non-U.S. markets could experience political uncertainty and/or change that subjects investments to heightened risks, including, for instance, risks related to elections in the
U.S., the large-scale invasion of Ukraine by Russia that began in February 2022, or the effect on world leaders and governments of global health pandemics, such as the COVID-19
pandemic. These heightened risks could also include: increased risk of default (by both government and private issuers); greater social, trade, economic and political instability
(including the risk of war or terrorist activity); greater governmental involvement in the economy; greater governmental supervision and regulation of the securities markets and market
participants resulting in increased expenses related to compliance; greater fluctuations in currency exchange rates; controls or restrictions on foreign investment and/or trade, capital
controls and limitations on repatriation of invested capital and on the ability to exchange currencies; inability to purchase and sell investments or otherwise settle security or derivative
transactions (i.e., a market freeze); unavailability of currency hedging techniques; and slower clearance. During times of political uncertainty and/or change, global markets often
become more volatile. There could also be a lower level of monitoring and regulation of markets while a country is experiencing political uncertainty and/or change, and the activities of
investors in such markets and enforcement of existing regulations could become more limited. Markets experiencing political uncertainty and/or change could have substantial, and in
some periods extremely high, rates of inflation for many years. Inflation and rapid fluctuations in inflation rates typically have negative effects on such countries’ economies and
markets. Tax laws could change materially, and any changes in tax laws could have an unpredictable effect on us, our investments and our investors. There can be no assurance that
political changes will not cause us or our investors to suffer losses.
The continuing impact of Brexit on our investments is uncertain and could adversely affect our business.
On January 31, 2020, the United Kingdom, or the UK, ended its membership in the European Union, or the EU, referred to as Brexit. Following the termination of a transition period, the
UK and the EU entered into a trade and cooperation agreement to govern the future relationship between the parties, which was provisionally applied as of January 1, 2021 and
entered into force on May 1, 2021 following ratification by the EU. With respect to financial services, the agreement leaves decisions on equivalence and adequacy to be determined by
each of the U.K. and E.U. unilaterally in due course. As a result, certain UK licensed entities are unable to provide regulated services in a number of EU jurisdictions from the end of
December 2020, absent regulatory relief or other measures implemented by individual countries. Such agreement is untested and could lead to ongoing political and economic
uncertainty and periods of exacerbated volatility in both the United Kingdom and in wider European and global markets for some time. The longer term economic, legal, political and
social implications of Brexit are unclear at this stage. Brexit has led to ongoing political and economic uncertainty and periods of increased volatility in both the UK and in wider
European markets for some time. Brexit could lead to calls for similar referendums in other European jurisdictions, which could cause increased economic volatility in the European
and global markets. This mid- to long-term uncertainty could have adverse effects on the economy generally and on our ability to earn attractive returns. In particular, currency volatility
could mean that our returns are adversely affected by market movements and could make it more difficult, or more expensive, for us to execute prudent currency hedging policies.
Potential decline in the value of the British Pound and/or the Euro against other currencies, along with the potential further downgrading of the UK’s sovereign credit rating, could also
have an impact on the performance of certain investments made in the UK or Europe.
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New or modified laws or regulations governing our operations could adversely affect our business.
We and our portfolio companies are subject to regulation by laws at the U.S. federal, state and local levels. These laws and regulations, as well as their interpretation, could change
from time to time, including as the result of interpretive guidance or other directives from the U.S. President and others in the executive branch, and new laws, regulations and
interpretations could also come into effect. For example, the current U.S. presidential administration could support an enhanced regulatory agenda that imposes greater costs on all
sectors and on financial services companies in particular. Any such new or changed laws or regulations could have a material adverse effect on our business, and political uncertainty
could increase regulatory uncertainty in the near term.
The effects of legislative and regulatory proposals directed at the financial services industry or affecting taxation, could negatively impact the operations, cash flows or financial
condition of us or our portfolio companies, impose additional costs on us or our portfolio companies, intensify the regulatory supervision of us or our portfolio companies or otherwise
adversely affect our business or the business of our portfolio companies. In addition, if we do not comply with applicable laws and regulations, we could lose any licenses that we then
hold for the conduct of our business and could be subject to civil fines and criminal penalties.
We invest in securities of issuers that are subject to governmental and non-governmental regulations, including by federal and state regulators and various self-regulatory organizations.
Companies participating in regulated activities could incur significant costs to comply with these laws and regulations. If a company in which we invest fails to comply with an applicable
regulatory regime, it could be subject to fines, injunctions, operating restrictions or criminal prosecution, any of which could materially and adversely affect the value of our investment.
Additionally, changes to the laws and regulations governing our operations, including those associated with RICs, could cause us to alter our investment strategy in order to avail
ourselves of new or different opportunities or result in the imposition of corporate-level taxes on us. Such changes could result in material differences to our strategies and plans and
could shift our investment focus from the areas of expertise of GC Advisors to other types of investments in which GC Advisors could have little or no expertise or experience. Any such
changes, if they occur, could have a material adverse effect on our results of operations and the value of your investment. If we invest in commodity interests in the future, GC Advisors
could determine not to use investment strategies that trigger additional regulation by the U.S. Commodity Futures Trading Commission, or the CFTC, or could determine to operate
subject to CFTC regulation, if applicable. If we or GC Advisors were to operate subject to CFTC regulation, we could incur additional expenses and would be subject to additional
regulation.
On October 21, 2014, U.S. risk retention rules adopted pursuant to Section 941 of Dodd-Frank, or the U.S. Risk Retention Rules, were issued and became effective with respect to
collateralized loan obligation, or CLOs, on December 24, 2016. The U.S. Risk Retention Rules require the sponsor (directly or through a majority-owned affiliate) of a debt securitization
subject to such rules, such as CLOs, in the absence of an exemption, to retain an economic interest, or the Retention Interest, in the credit risk of the assets being securitized in the
form of an eligible horizontal residual interest, an eligible vertical interest, or a combination thereof, in accordance with the requirements of the U.S. Risk Retention Rules. Due to the
interplay of the 1940 Act restrictions on principal and joint transactions and the U.S. Risk Retention Rules, we sought no-action relief to ensure that we could engage in CLO financing
under the 1940 Act and the risk retention rules mandated by Section 941 of Dodd-Frank. On September 7, 2018 we received a no-action letter from the staff, or the Staff, of the Division
of Investment Management of the SEC that states that the Staff would not recommend that the SEC take any enforcement action under Section 57(a) of the1940 Act, or Rule 17d-1
under the 1940 Act against us or GC Advisors if we were to acquire CLO equity as a Retention Interest in the manner described in a letter submitted to the Staff on behalf of us.
However, the no-action relief we received did not address whether or not the CLO transactions described therein would satisfy the requirements of the U.S. Risk Retention Rules. As a
general matter, available interpretive authority to date addressing the U.S. Risk Retention Rules applicable to CLOs is limited, and there is limited judicial decisional authority or
applicable agency interpretation that has directly addressed any of the risk retention approaches taken with respect to CLOs. Accordingly, there can be no assurance that the applicable
federal agencies will agree that any CLO transaction we undertake, or the manner in which we hold any retention interests, complies with the U.S. Risk Retention Rules. If we ever
determined that undertaking CLO transactions would subject us or any of our affiliates to unacceptable regulatory risk, our ability to execute CLOs could be limited or otherwise
curtailed. Given the more attractive financing costs associated with these types of debt securitization as opposed to other types of financing available (such as traditional senior
secured facilities), this would, in turn, increase our financing costs. Any associated increase in financing costs would ultimately be borne by our common stockholders.
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Over the last several years, there also has been an increase in regulatory attention to the extension of credit outside of the traditional banking sector, raising the possibility that some
portion of the non-bank financial sector will be subject to new regulation. While it cannot be known at this time whether any regulation will be implemented or what form it will take,
increased regulation of non-bank credit extension could negatively impact our operations, cash flows or financial condition, impose additional costs on us, intensify the regulatory
supervision of us or otherwise adversely affect our business, financial condition and results of operations.
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.
Our compliance with Section 404 of the Sarbanes-Oxley Act involves significant expenditures, and non-compliance with Section 404 of the Sarbanes-Oxley Act would
adversely affect us and the market price of our common stock.
Under current SEC rules, we are required to report on our internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act and related rules and regulations of
the SEC. As such, we are required to review on an annual basis our internal control over financial reporting, and on a quarterly and annual basis to evaluate and disclose changes in
our internal control over financial reporting. As a result, we incur expenses that could negatively impact our financial performance and our ability to make distributions. This process also
results in a diversion of management’s time and attention. We cannot ensure that our evaluation, testing and remediation process is effective or that our internal control over financial
reporting will be effective. In the event that we are unable to maintain compliance with Section 404 of the Sarbanes-Oxley Act and related rules, we and the market price of our
securities would be adversely affected.
Technological innovations and industry disruptions could negatively impact us.
Technological innovations have disrupted traditional approaches in multiple industries and can permit younger companies to achieve success and in the process disrupt markets and
market practices. We can provide no assurance that new businesses and approaches will not be created that would compete with us and/or our portfolio companies or alter the market
practices in which GC Advisors and its affiliates and us have been designed to function within and on which we depend on for our investment return. New approaches could damage
our investments, disrupt the market in which we operate and subject us to increased competition, which could materially and adversely affect our business, financial condition and
results of investments.
We are highly dependent on information systems and systems failures could significantly disrupt our business, which could, in turn, negatively affect the market price of
our common stock and our ability to pay distributions.
Our business depends on the communications and information systems of GC Advisors and its affiliates. GC Advisors and the Administrator are heavily reliant on the information
technology infrastructure, processes and procedures of Golub Capital, which has devoted significant resources to developing effective and reliable information technology systems.
Information technology changes rapidly, however, and Golub Capital could fail to stay ahead of such advances. Moreover, Golub Capital could find itself a target of cyberattacks,
including cyber espionage, malware, ransomware, and other types of hacking. If any of the Golub Capital information technology systems do not operate properly or are disabled,
whether as a result of tampering or a breach of network security systems or otherwise, we and Golub Capital could suffer, among other consequences, financial loss, disruption of
businesses and reputational damage and, in the case of Golub Capital, liability to clients. While steps have been taken to mitigate the risk and impact of such attacks, no system is fully
attack-proof, and a cyberattack could have an adverse impact on us.
In addition, Golub Capital’s operations rely on the secure processing, storage and transmission of confidential and other information in its computer systems and networks. Although
Golub Capital takes protective measures, its computer systems, software and networks could be vulnerable to unauthorized access, theft, misuse, computer viruses or other malicious
code and other events that could have an impact on security. We, GC Advisors and the Administrator rely on third-party service providers for certain aspects of their business. Any
interruption or deterioration in the performance of these third parties or failures of their information systems and technology could impair the quality of the operations and could affect
their reputation, which could have an adverse effect on us.
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A data breach could negatively impact our business and result in significant penalties.
GC Advisors is subject to numerous laws in various jurisdictions relating to privacy and the storage, sharing, use, processing, disclosure and protection of information that we and our
affiliates hold. The EU’s General Data Protection Regulation, the Cayman Islands Data Protection Law, 2017, and the California Consumer Privacy Act of 2018 are recent examples of
such laws, and GC Advisors anticipates new privacy and data protection laws will be passed in other jurisdictions in the future. In general, these laws introduce many new obligations
on GC Advisors and its affiliates and service providers and create new rights for parties who have given us their personal information, such as investors and others.
Breach of these laws could result in significant financial penalties for GC Advisors and/or us. As interpretation of these laws evolves and new laws are passed, GC Advisors could be
required to make changes to its business practices, which could result in additional risks, costs and liabilities to us and adversely affect investment returns. While GC Advisors intends
to comply with its privacy and data protection obligations under the privacy and data protection laws that are applicable to it, it is possible that GC Advisors will not be able to accurately
anticipate the ways in which regulators and courts will apply or interpret these laws. A violation of applicable privacy and data protection law could result in negative publicity and/or
subject GC Advisors or us, to significant costs associated with litigation, settlements, regulatory action, judgments, liabilities and/or penalties.
Cybersecurity risks and cyber incidents may adversely affect our business or the business of our portfolio companies.
The operations of us, Golub Capital, any third-party service provider to us or Golub Capital and our portfolio companies are susceptible to risks from cybersecurity attacks and incidents
due to reliance on the secure processing, storage and transmission of confidential and other information in relevant computer systems and networks. An adverse event that threatens
the confidentiality, integrity or availability of the information resources of us or our portfolio companies, or a cyber incident, may be an intentional attack or an unintentional event and
could involve gaining unauthorized access to the information systems of us, Golub Capital or our portfolio companies for purposes of misappropriating assets, stealing confidential
information, corrupting data or causing operational disruption. Cyber-attacks may also be carried out in a manner that does not require gaining unauthorized access, such as causing
denial-of-service attacks on websites (i.e., efforts to make network services unavailable to intended users). Cyber security incidents and cyber-attacks have been occurring globally at a
more frequent and severe level and will likely continue to increase in frequency in the future. The result of these incidents may include disrupted operations, misstated or unreliable
financial data, liability for stolen assets or information, increased cybersecurity protection and insurance costs, litigation and damage to business relationships.
The costs related to cyber or other security threats or disruptions may not be fully insured or indemnified by other means. As our and our portfolio companies’ reliance on technology
has increased, so have the risks posed to information systems of ours, Golub Capital and our portfolio companies. Although Golub Capital takes protective measures, these measures,
as well as an increased awareness of the nature and extent of a risk of a cyber incident, do not guarantee that a cyber incident will not occur and/or that the financial results, operations
or confidential information of ours or our portfolio companies will not be negatively impacted by any such incident. Cybersecurity risks require continuous and increasing attention and
other resources, which attention diverts time and other resources from other activities of ours, Golub Capital and our portfolio companies. There is no assurance that any efforts to
mitigate cybersecurity risks undertaken by us, Golub Capital or our portfolio companies will be effective. Network, system, application and data breaches as a result of cybersecurity
risks or cyber incidents could result in operational disruptions or information misappropriation that could have a material adverse effect on the business, results of operations and
financial condition of us and of our portfolio companies.
Our business and operations could be negatively affected if we become subject to stockholder activism, which could cause us to incur significant expense, hinder the
execution of our investment strategy or impact our stock price.
Stockholder activism, which could take many forms, including making public demands that we consider certain strategic alternatives, engaging in public campaigns to attempt to
influence our corporate governance and/or our management, and commencing proxy contests to attempt to elect the activists’ representatives or others to our board of directors, or
arise in a variety of situations, has been increasing in the business development company space recently. While we are currently not subject to any stockholder activism, due to the
potential volatility of our stock price and for a variety of other reasons, we could in the future become the target of stockholder activism.
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Stockholder activism could result in substantial costs and divert management’s and our board of directors’ attention and resources from our business. Additionally, such stockholder
activism could give rise to perceived uncertainties as to our future and adversely affect our relationships with service providers and our portfolio companies. Also, we could be required
to incur significant legal and other expenses related to any activist stockholder matters. Further, our stock price could be subject to significant fluctuation or otherwise be adversely
affected by the events, risks and uncertainties of any stockholder activism.
Item 1B. Unresolved Staff Comments
None.
Item 1C. Cybersecurity
Not applicable.
Item 2. Properties
Properties
We do not own any real estate or other physical properties materially important to our operation. Our headquarters are located at 200 Park Avenue, 25th Floor, New York, NY 10166
and are provided by the Administrator pursuant to the Administration Agreement. We believe that our office facilities are suitable and adequate to our business.
Item 3. Legal Proceedings
We, GC Advisors and the Administrator could, from time to time, be involved in legal and regulatory proceedings arising out of their respective operations in the normal course of
business or otherwise. While there can be no assurance of the ultimate disposition of any such proceedings, each of us, GC Advisors and the Administrator do not believe it is currently
subject to any material legal proceedings.
Item 4. Mine Safety Disclosure
None.
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PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Price Range of Common Stock
Our common stock began trading on April 15, 2010 and is currently traded on The Nasdaq Global Select Market under the symbol “GBDC”. The following table lists the high and low
closing sale price for our common stock, the closing sale price as a percentage of net asset value, or NAV, and quarterly distributions per share.
Period
Fiscal year ended September 30, 2023
Fourth quarter
Third quarter
Second quarter
First quarter
Fiscal year ended September 30, 2022
Fourth quarter
Third quarter
Second quarter
First quarter
Closing Sales Price
NAV
(1)
High
Low
Premium (Discount) of
High Sales
Price to
NAV
(2)
Premium
(Discount) of
Low Sales
Price to
NAV
(2)
Distributions
Declared
$
$
$
$
15.02
14.83
14.73
14.71
14.89
15.14
15.35
15.26
$
$
15.02
13.55
14.09
14.25
14.35
15.48
16.10
15.99
13.37
13.02
12.38
12.46
12.21
12.67
14.70
14.86
— %
(8.6)
(4.3)
(3.1)
(3.6) %
2.2
4.9
4.8
(11.0) % $
(12.2)
(16.0)
(15.3)
(18.0) % $
(16.3)
(4.2)
(2.6)
0.41
0.33
0.33
0.33
0.30
0.30
0.30
0.30
(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 closing sales prices. The NAVs shown are based on
outstanding shares at the end of each period.
(2)
Calculated as of the respective high or low closing sales price divided by the quarter-end NAV.
The last reported price for our common stock on November 16, 2023 was $14.84 per share. As of November 16, 2023, we had 894 stockholders of record.
Distributions
Our distributions, if any, are determined by the board of directors. We elected to be treated as a RIC under Subchapter M of the Code. In order to be subject to tax as a RIC, we must
distribute to our stockholders dividends for U.S. federal income tax purposes each tax year of an amount at least equal to 90% of our net ordinary income and net short-term capital
gains in excess of our net long-term capital losses, or investment company taxable income, determined without regard to any deduction for dividends paid. In addition, we are subject to
ordinary income and capital gain distribution requirements under U.S. federal excise tax rules for each calendar year. If we do not meet the required distributions we will be subject to a
4% nondeductible federal excise tax on the undistributed amount.
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The following table reflects the cash distributions, including dividends and returns of capital per share that we have declared on our common stock.
Record Dates
Fiscal year ended September 30, 2023
September 1, 2023
August 18, 2023
June 2, 2023
March 3, 2023
December 9, 2022
Total
Fiscal year ended September 30, 2022
September 2, 2022
June 3, 2022
March 4, 2022
December 10, 2021
Total
Payment Date
Distributions
Declared
September 29, 2023
September 15, 2023
June 29, 2023
March 29, 2023
December 29, 2022
September 29, 2022
June 29, 2022
March 29, 2022
December 30, 2021
$
$
$
$
0.37
0.04
0.33
0.33
0.33
1.40
0.30
0.30
0.30
0.30
1.20
On November 17, 2023, our board of directors declared a quarterly distribution of $0.37 per share, which is payable on December 29, 2023 to holders of record as of December 8, 2023,
and a supplemental distribution of $0.07 per share, which is payable on December 15, 2023 to holders of record as of December 1, 2023.
We have adopted a dividend reinvestment plan that provides for reinvestment of our dividends and other distributions on behalf of our stockholders. As a result, if our board of directors
authorizes, and we declare, a cash dividend or other distribution, then our stockholders who participate in our dividend reinvestment plan will have their cash distribution reinvested in
additional shares of our common stock, rather than receiving the cash distribution.
Recent Sales of Unregistered Securities
None.
Issuer Purchases of Equity Securities
On August 5, 2022, our Board approved the Program (as defined in Note 2 of our consolidated financial statements), which allows us to repurchase up to $150 million of our
outstanding common stock on the open market at prices below the NAV per share as reported in our then most recently published consolidated financial statements. The Program is
implemented at the discretion of management with shares to be purchased from time to time at prevailing market prices, through open market transactions, including block transactions,
pursuant to Rule 10b-18 under the Securities Exchange Act of 1934, as amended. We did not make any repurchases of our common stock during the year ended September 30, 2022.
On August 3, 2023, the Board reapproved the Program to repurchase up to $150 million of our common stock pursuant to the Program, exclusive of shares repurchased prior to the
date of such authorization. Under the Program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable
securities laws and regulations. As of September 30, 2023, the repurchased shares have been retired and returned to the status of authorized but unissued shares of GBDC Common
Stock.
As of September 30, 2023, Wells Fargo Securities, LLC, as broker, repurchased 1,300,928 shares of our common stock pursuant to the Program for an aggregate purchase price of
approximately $16.9 million. For the year ended September 30, 2023, repurchases under the Program were as follows:
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Day Purchased
Total Number of Shares
Repurchased
Average Price Paid Per
Share
March 1 - 31, 2023
April 1 - 30, 2023
May 1 - 31, 2023
June 1 - 30, 2023
July 1 - 31, 2023
Total
751,544
56,130
188,210
299,794
5,250
1,300,928
$12.84
13.03
12.95
13.26
13.29
$12.96
Approximate Dollar Value of Shares that have
been Purchased Under the Plan
(In thousands)
$9,647
731
2,438
3,975
70
$16,861
Approximate Dollar Value of Shares that May
Yet be Purchased Under the Plan
(In thousands)
$140,353
139,622
137,184
133,209
133,139
$150,000
(1)
(1)
The program was re-approved on August 3, 2023 to purchase $150.0 million of the Company’s common stock, exclusive of shares repurchased prior to the date of such authorization. No additional shares have
been purchased since the re-approval.
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Stock Performance Graph
This graph compares the stockholder return on our common stock from September 30, 2017 to September 30, 2023 with that of the NASDAQ Financial 100 Stock Index and the
Standard & Poor’s 500 Stock Index. This graph assumes that on September 30, 2016, $100 was invested in our common stock, the NASDAQ Financial 100 Stock Index, and the
Standard & Poor’s 500 Stock Index. The graph also assumes the reinvestment of all cash distributions prior to any tax effect. The graph and other information furnished under this Part
II Item 5 of this annual report on Form 10-K shall not be deemed to be “soliciting material” or to be “filed” with the SEC or subject to Regulation 14A or 14C under, or to the liabilities of
Section 18 of, the Exchange Act. The stock price performance included in the below graph is not necessarily indicative of future stock performance.
Fees and Expenses
The following table is being provided to update, as of September 30, 2023, certain information in our registration statement on Form N-2 (File No. 333-265509). The following table is
intended to assist you in understanding the costs and expenses that an investor in shares of our common stock will bear directly or indirectly. However, we caution you that some of the
percentages indicated in the table below are estimates and may vary. Actual costs and expenses incurred by investors in shares of our common stock may be greater than the
percentage estimates in the table below. The following table excludes one-time fees payable to third parties not affiliated with GC Advisors that were incurred in connection with the
Debt Securitizations, but includes all of the applicable ongoing fees and expenses of the Debt Securitizations. Whenever reference to fees or expenses paid by “us” or “Golub Capital
BDC,” or that “we” will pay fees or expenses, our common stockholders will indirectly bear such fees or expenses.
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Stockholder transaction expenses:
Sales load (as a percentage of offering price)
Offering expenses (as a percentage of offering price)
Dividend reinvestment plan expenses
Total stockholder transaction expenses (as a percentage of offering price)
Annual expenses (as a percentage of net assets attributable to common stock):
Management fees
Incentive fees payable under the Investment Advisory Agreement
Interest payments on borrowed funds
Other expenses
Acquired fund fees and expenses
Total annual expenses
0 % (1)
0 % (2)
None (3)
0 %
2.17 % (4)
3.03 % (5)
5.91 % (6)
0.72 % (7)
0 %
11.83 % (8)
(1)
(2)
(3)
(4)
(5)
In the event that the securities to which any applicable prospectus relates are sold to or through underwriters or agents, a corresponding prospectus supplement will disclose the applicable sales load.
In the event that we conduct an offering of our securities, the related prospectus supplement will disclose the estimated amount of total offering expenses (which may include offering expenses borne by third
parties on our behalf), the offering price and the offering expenses borne by us as a percentage of the offering price.
The expenses associated with the dividend reinvestment plan are included in “Other expenses.” See “Dividend Reinvestment Plan.”.
Effective as of July 1, 2023, our management fee is calculated at an annual rate equal to 1.0% and is based on the average adjusted gross assets (including assets purchased with borrowed funds and
securitization-related assets, leverage, unrealized depreciation or appreciation on derivative instruments and cash collateral on deposit with custodian but adjusted to exclude cash and cash equivalents so that
investors do not pay the base management fee on such assets) at the end of the two most recently completed calendar quarters and is payable quarterly in arrears. See “Item 1. Business — Management
Agreements” and “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Recent Developments”. The management fee referenced in the table above is annualized and
based on actual amounts incurred during the year ended September 30, 2023 by GC Advisors in its capacity as investment adviser to us and collateral manager to the 2018 Issuer and the GCIC 2018 Issuer,
collectively the Securitization Issuers, adjusted on a retroactive basis for the reduction in our base management fee from 1.375% to 1.0%, effective as of July 1, 2023. The adjusted estimate of our annualized base
management fees based on actual expenses for the year ended September 30, 2023 assumes net assets of $2,548 million and leverage of $3,133 million, which reflects our net assets and leverage as of
September 30, 2023.
GC Advisors, as collateral manager for the 2018 Issuer, under a collateral management agreement, or the 2018 Collateral Management Agreement, is entitled to receive an annual fee in an amount equal to 0.35%
of the principal balance of the portfolio loans held by the 2018 Issuer at the beginning of the collection period relating to each payment date, which is payable in arrears on each payment date. This fee, which is
less than the management fee payable under the Investment Advisory Agreement, is paid directly by the 2018 Issuer to GC Advisors and offset against such management fee. Accordingly, the base management
fee paid by us to GC Advisors under the Investment Advisory Agreement on all of our assets, including those indirectly held through the 2018 Issuer, is reduced, on a dollar-for-dollar basis, by an amount equal to
such 0.35% fee paid to GC Advisors by the 2018 Issuer. Under the 2018 Collateral Management Agreement, the term “collection period” generally refers to a quarterly period commencing on the day after the end
of the prior collection period to the tenth business day prior to the payment date. This fee may be waived by the collateral manager. The 2018 Collateral Management Agreement does not include any incentive fee
payable to GC Advisors.
GC Advisors, as collateral manager for the GCIC 2018 Issuer, under a collateral management agreement, or the GCIC 2018 Collateral Management Agreement, is entitled to receive an annual fee in an amount
equal to 0.35% of the principal balance of the portfolio loans held by the GCIC 2018 Issuer at the beginning of the collection period relating to each payment date, which is payable in arrears on each payment date.
This fee, which is less than the management fee payable under the Investment Advisory Agreement, is paid directly by the GCIC 2018 Issuer to GC Advisors and offset against such management fee. Accordingly,
the base management fee paid by us to GC Advisors under the Investment Advisory Agreement on all of our assets, including those indirectly held through the GCIC 2018 Issuer, is reduced, on a dollar-for-dollar
basis, by an amount equal to such 0.35% fee paid to GC Advisors by the GCIC 2018 Issuer. Under the GCIC 2018 Collateral Management Agreement, the term “collection period” generally refers to a quarterly
period commencing on the day after the end of the prior collection period to the tenth business day prior to the payment date. This fee may be waived by the collateral manager. The GCIC 2018 Collateral
Management Agreement does not include any incentive fee payable to GC Advisors.
For purposes of this table, the SEC requires that the “Management fees” percentage be calculated as a percentage of net assets attributable to common stock, rather than total assets, including assets that have
been funded with borrowed monies, because common stockholders bear all of this cost. If the base management fee portion of the “Management fees” percentage were calculated instead as a percentage of our
total assets, our base management fee portion of the “Management fees” percentage would be approximately 0.96% of total assets.
The incentive fee referenced in the table above is based on actual amounts of the income component of the incentive fee incurred during the year ended September 30, 2023, adjusted on a retroactive basis for the
reduction in our base management fee from 1.375% to 1.0%, effective as of July 1, 2023. As of September 30, 2023, no amount was payable for the capital gains component under the Investment Advisory
Agreement. We have structured the calculation of the incentive fee to include a fee limitation such that no incentive fee will be paid to GC Advisors for any quarter if, after such payment, the cumulative incentive
fees paid to GC Advisors since the effective date of our election to become a business development company would be greater than 20.0% of our cumulative pre-incentive fee net income per share. For a more
detailed discussion of the calculation of the incentive fee, see “Item 1. Business - Management Agreement - Income and Capital Gains Incentive Fee Calculation” as well as any amendments reflected in
subsequent filings with the SEC.
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(6)
(7)
(8)
Interest payments on borrowed funds is based on our cost of funds on our outstanding indebtedness for the year ended September 30, 2023, which consisted of $784.4 million of indebtedness outstanding under
the JPM Revolving Credit Facility, $902.2 million in notes issued through the Debt Securitizations, $500.0 million of 2024 Notes, $600.0 million of 2026 Notes, and $350.0 million of 2027 Notes. For the year ended
September 30, 2023, the annualized cost of funds for our total debt outstanding, which includes all interest, accretion of discounts, and amortization of debt issuance costs on the Debt Securitizations, was 4.91%.
Debt issuance costs represent fees and other direct incremental costs incurred in connection with our Debt Securitizations. These fees include a structuring and placement fee paid to Morgan Stanley & Co. LLC
for its services in connection with the initial structuring of the 2018 Debt Securitization and legal fees, accounting fees, rating agency fees and all other costs associated with the 2018 Debt Securitization.
Includes our overhead expenses, including payments under the Administration Agreement based on our allocable portion of overhead and other expenses incurred by the Administrator, and any acquired fund fees
and expenses that are not required to be disclosed separately. See “Item 1. Management Agreements - Administration Agreements”, as well as any amendments reflected in subsequent filings with the SEC.
“Other expenses” also includes the ongoing administrative expenses to the trustee, collateral manager, independent accountants, legal counsel, rating agencies and independent managers in connection with
developing and maintaining reports and providing required services in connection with the administration of each of the Debt Securitizations. Additionally, “Other expenses” includes the actual amount incurred for
U.S. federal excise tax. “Other expenses” are based on actual amounts incurred for the year ended September 30, 2023. The administrative expenses of each of the Securitization Issuers are paid on each
payment date in two parts: (1) a component that is paid in a priority to other amounts distributed by the applicable Securitization Issuer, subject to a cap equal to the sum of 0.04% per annum of the adjusted
principal balance of the portfolio loans and other assets held by the applicable Securitization Issuer on the last day of the collection period relating to such payment date, plus $150,000 per annum, and (2) a
component that is paid in a subordinated position relative to other amounts distributed by the applicable Securitization Issuer equal to any amounts that exceed the aforementioned administrative expense cap.
All of our expenses, including all expenses of each of the Debt Securitizations, are disclosed in the appropriate line items under “Annual Expenses (as a percentage of net assets attributable to common stock).”
“Total annual expenses” as a percentage of consolidated net assets attributable to common stock are higher than the total annual expenses percentage would be for a company that is not leveraged. We borrow
money to leverage our net assets and increase our total assets. The SEC requires that the “Total annual expenses” percentage be calculated as a percentage of net assets (defined as total assets less
indebtedness and after taking into account any incentive fees payable during the period), rather than the total assets, including assets that have been funded with borrowed monies. The reason for presenting
expenses as a percentage of net assets attributable to common stockholders is that our common stockholders bear all of our fees and expenses.
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. This example and the expenses in the table above should not be considered a representation of our future expenses, and actual expenses (including the cost of
debt, if any, and other expenses) may be greater or less than those shown.
You would pay the following expenses on a $1,000 investment
Assuming a 5% annual return (assumes no return from net realized capital gains or net unrealized capital
appreciation)
Assuming a 5% annual return (assumes return entirely from realized capital gains and thus subject to the capital
gain incentive fee)
1 year
$103
$112
3 years
$266
$292
5 years
$417
$454
10 years
$748
$797
The foregoing table is to assist you in understanding the various costs and expenses that an investor in our common stock will bear directly or indirectly. 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%. The incentive fee under the Investment Advisory Agreement,
which, assuming a 5% annual return, would either not be payable or have an immaterial impact on the expense amounts shown above, is not included in the example. Under our
Investment Advisory Agreement, no incentive fee would be payable if we have a 5% annual return. If we achieve sufficient returns on our investments, including through the realization
of capital gains, to trigger an incentive fee of a material amount, our expenses, and returns to our investors, would be higher. The example assumes that all dividends and other
distributions are reinvested at net asset value. Under certain circumstances, reinvestment of dividends and other distributions under our dividend reinvestment plan may occur at a price
per share that differs from net asset value. See “Dividend Reinvestment Plan” for more information.
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Item 6. Reserved
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Item 7. 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 consolidated financial statements and related notes thereto appearing elsewhere in this annual report
on Form 10-K. In this report, “we,” “us,” “our” and “Golub Capital BDC” refer to Golub Capital BDC, Inc. and its consolidated subsidiaries.
Forward-Looking Statements
Some of the statements in this annual report on Form 10-K constitute forward-looking statements, which relate to future events or our future performance or financial condition. The
forward-looking statements contained in this annual report on Form 10-K involve risks and uncertainties, including statements as to:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
our future operating results;
our business prospects and the prospects of our portfolio companies, including our and their ability to achieve our respective objectives due to disruptions, including those
caused by global health pandemics, such as the COVID-19 pandemic, or other large scale events;
the effect of investments that we expect to make and the competition for those investments;
our contractual arrangements and relationships with third parties;
actual and potential conflicts of interest with GC Advisors and other affiliates of Golub Capital;
the dependence of our future success on the general economy and its effect on the industries in which we invest;
the ability of our portfolio companies to achieve their objectives;
the use of borrowed money to finance a portion of our investments;
the adequacy of our financing sources and working capital;
the timing of cash flows, if any, from the operations of our portfolio companies;
general economic and political trends and other external factors, including the COVID-19 pandemic;
changes in political, economic or industry conditions, the interest rate environment or conditions affecting the financial and capital markets that could result in changes to the
value of our assets;
elevating levels of inflation, and its impact on us, on our portfolio companies and on the industries in which we invest;
the ability of GC Advisors to locate suitable investments for us and to monitor and administer our investments;
the ability of GC Advisors or its affiliates to attract and retain highly talented professionals;
the ability of GC Advisors to continue to effectively manage our business due to disruptions, including those caused by global health pandemics, such as the COVID-19
pandemic, or other large scale events;
turmoil in Ukraine and Russia, including sanctions related to such turmoil, and the potential for volatility in energy prices and other supply chain issues and any impact on the
industries in which we invest;
our ability to qualify and maintain our qualification as a RIC and as a business development company;
the impact of information technology systems and systems failures, including data security breaches, data privacy compliance, network disruptions, and cybersecurity attacks;
general price and volume fluctuations in the stock markets;
the impact on our business of Dodd-Frank and the rules and regulations issued thereunder and any actions toward repeal thereof; and
the effect of changes to tax legislation and our tax position.
Such forward-looking statements may include statements preceded by, followed by or that otherwise include the words “may,” “might,” “will,” “intend,” “should,” “could,” “can,” “would,”
“expect,” “believe,” “estimate,” “anticipate,” “predict,” “potential,” “plan” or similar words. The forward looking statements contained in this annual report on Form 10-K involve risks and
uncertainties. Our actual results could differ materially from those implied or
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expressed in the forward-looking statements for any reason, including the factors set forth as “Risk Factors” in this annual report on Form 10-K.
We have based the forward-looking statements included in this report on information available to us on the date of this report. Actual results could differ materially from those
anticipated in our forward-looking statements and future results could differ materially from historical performance. You are advised to consult any additional disclosures that we make
directly to you or through reports that we have filed or in the future file with the SEC including annual reports on Form 10-K, registration statements on Form N-2, quarterly reports on
Form 10-Q and current reports on Form 8-K. This annual report on Form 10-K contains statistics and other data that have been obtained from or compiled from information made
available by third-party service providers. We have not independently verified such statistics or data.
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Overview
We are an externally managed, closed-end, non-diversified management investment company that has elected to be regulated as a business development company under the 1940
Act. In addition, for U.S. federal income tax purposes, we have elected to be treated as a RIC under Subchapter M of the Code. As a business development company and a RIC, we
are also subject to certain constraints, including limitations imposed by the 1940 Act and the Code.
Our shares are currently listed on The Nasdaq Global Select Market under the symbol “GBDC.”
Our investment objective is to generate current income and capital appreciation by investing primarily in one stop (a loan that combines characteristics of traditional first lien senior
secured loans and second lien or subordinated loans and that are often referred to by other middle-market lenders as unitranche loans) and other senior secured loans of U.S. middle-
market companies. We also selectively invest in second lien and subordinated loans of, and warrants and minority equity securities in U.S. middle-market companies. We intend to
achieve our investment objective by (1) accessing the established loan origination channels developed by Golub Capital, a leading lender to U.S. middle-market companies with over
$60.0 billion in capital under management as of July 1, 2023, (2) selecting investments within our core middle-market company focus, (3) partnering with experienced private equity
firms, or sponsors, in many cases with whom Golub Capital has invested alongside in the past, (4) implementing the disciplined underwriting standards of Golub Capital and (5)
drawing upon the aggregate experience and resources of Golub Capital.
Our investment activities are managed by GC Advisors and supervised by our board of directors of which a majority of the members are independent of us, GC Advisors and its
affiliates.
Under the Investment Advisory Agreement, we have agreed to pay GC Advisors an annual base management fee based on our average adjusted gross assets as well as an incentive
fee based on our investment performance. The Investment Advisory Agreement was most recently approved by our board of directors in August 2023. Under the Administration
Agreement, we are provided with certain administrative services by an administrator, or the Administrator, which is currently Golub Capital LLC. Under the Administration Agreement,
we have agreed to reimburse the Administrator for our allocable portion (subject to the review and approval of our independent directors) of overhead and other expenses incurred by
the Administrator in performing its obligations under the Administration Agreement.
We seek to create a portfolio that includes primarily one stop and other senior secured loans by primarily investing approximately $10.0 million to $80.0 million of capital, on average, in
the securities of U.S. middle-market companies. We also selectively invest more than $80.0 million in some of our portfolio companies and generally expect that the size of our
individual investments will vary proportionately with the size of our capital base.
We generally invest in securities that have been rated below investment grade by independent rating agencies or that would be rated below investment grade if they were rated. These
securities, which are often referred to as “junk,” have predominantly speculative characteristics with respect to the issuer’s capacity to pay interest and repay principal. In addition, many
of our debt investments have floating interest rates that reset on a periodic basis and typically do not fully pay down principal prior to maturity, which may increase our risk of losing part
or all of our investment.
As of September 30, 2023 and September 30, 2022, our portfolio at fair value was comprised of the following:
Investment Type
Senior secured
One stop
Second lien
Subordinated debt
Equity
Total
As of September 30, 2023
As of September 30, 2022
Investments at
Fair Value
(In thousands)
Percentage of
Total
Investments
Investments at
Fair Value
(In thousands)
Percentage of
Total
Investments
$
$
503,985
4,678,099
29,154
7,945
297,430
5,516,613
9.1 % $
84.8
0.5
0.2
5.4
100.0 % $
472,873
4,668,609
23,240
3,815
277,819
5,446,356
8.7 %
85.7
0.4
0.1
5.1
100.0 %
One stop loans include loans to technology companies undergoing strong growth due to new services, increased adoption and/or entry into new markets. We refer to loans to these
companies as recurring revenue loans. Other
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targeted characteristics of recurring revenue businesses include strong customer revenue retention rates, a diversified customer base and backing from growth equity or venture
capital firms. In some cases, the borrower’s high revenue growth is supported by a high level of discretionary spending. As part of the underwriting of such loans and consistent with
industry practice, we adjust our characterization of the earnings of such borrowers for a reduction or elimination of such discretionary expenses, if appropriate. As of September 30,
2023 and September 30, 2022, one stop loans included $782.6 million and $659.1 million, respectively, of recurring revenue loans at fair value.
As of September 30, 2023 and September 30, 2022, we had debt and equity investments in 342 and 331 portfolio companies, respectively.
The following table shows the weighted average income yield and weighted average investment income yield of our earning portfolio company investments, which represented nearly
100% of our debt investments, as well as the annualized total return based on our average net asset value, and the total return based on the change in the quoted market price of our
stock and assuming distributions were reinvested in accordance with our dividend reinvestment plan, or DRIP, in each case for years ended September 30, 2023 and 2022:
Weighted average income yield
Weighted average investment income yield
Total return based on average net asset value
Total return based on market value
(4)
(6)
(1)(2)(3)
(5)
Year ended
September 30, 2023
11.2%
11.6%
10.2%
30.5%
September 30, 2022
7.4%
8.0%
5.9%
(14.8)%
(1)
(2)
(3)
(4)
(5)
(6)
Represents income from interest, fees, accrued PIK and non-cash dividend income, excluding amortization of capitalized fees and discounts, divided by the average fair value of earning portfolio company
investments, and does not represent a return to any investor in us.
The income yield presented for the quarter September 30, 2023 excludes the one-time recognition of $3.7 million of previously deferred interest income resulting from a former non-accrual loan returning to accrual
status, which are included in the calculation of the investment income yield for the quarter ended September 30, 2023. The income yield was 12.2% for the quarter ended September 30, 2023 when including the
$3.7 million of interest income.
The income yield presented for the year ended September 30, 2022 excludes the one-time recognition of $2.0 million of previously deferred interest income resulting from the repayment and refinancing of former
non-accrual loans, which are included in the calculation of the investment income yield for the year ended September 30, 2022. The income yield was 8.6% for the year ended September 30, 2022 when including
the $2.0 million of interest income
Represents income from interest, fees, accrued PIK and non-cash dividend income and amortization of capitalized fees and discounts, excluding amortization of purchase premium (as described in Note 2 of the
consolidated financial statements), divided by the average fair value of earning portfolio investments, and does not represent a return to any investor in us.
Total return based on average net asset value is calculated as (a) the net increase/(decrease) in net assets resulting from operations divided by (b) the daily average of total net assets. Total return does not
include sales load.
Total return based on market value assumes distributions are reinvested in accordance with the DRIP. Total return does not include sales load.
Revenues: We generate revenue in the form of interest and fee income on debt investments and capital gains and distributions, if any, on portfolio company investments that we
originate or acquire. Our debt investments, whether in the form of senior secured, one stop, second lien or subordinated loans, typically have a term of three to seven years and bear
interest at a fixed or floating rate. In some instances, we receive payments on our debt investments based on scheduled amortization of the outstanding balances. In addition, we
receive repayments of some of our debt investments prior to their scheduled maturity date. The frequency or volume of these repayments fluctuates significantly from period to period.
Our portfolio activity also reflects the proceeds of sales of securities.
In some cases, our investments provide for deferred interest payments or PIK interest. The principal amount of loans and any accrued but unpaid interest generally become due at the
maturity date.
In addition, we generate revenue in the form of commitment, origination, amendment, structuring or due diligence fees, fees for providing managerial assistance, administrative agent
fees and consulting fees. Loan origination fees, original issue discount and market discount or premium are capitalized, and we accrete or amortize such amounts as interest income.
We record prepayment premiums on loans as fee income. For additional details on revenues, see “Critical Accounting Policies—Revenue Recognition.” We recognize realized gains or
losses on investments based on the difference between the net proceeds from the disposition and the amortized cost basis of the investment or derivative instrument, without regard to
unrealized gains or losses previously recognized. We record current period changes in fair value of investments and derivative instruments that are measured at fair value as a
component of the
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net change in unrealized appreciation (depreciation) on investment transactions in the Consolidated Statements of Operations.
Expenses: Our primary operating expenses include the payment of fees to GC Advisors under the Investment Advisory Agreement and interest expense on our outstanding debt. We
bear all other out-of-pocket costs and expenses of our operations and transactions, including:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
calculating our NAV (including the cost and expenses of any independent valuation firm);
fees and expenses incurred by GC Advisors payable to third parties, including agents, consultants or other advisors, in monitoring financial and legal affairs for us and in
monitoring our investments and performing due diligence on our prospective portfolio companies or otherwise relating to, or associated with, evaluating and making
investments, which fees and expenses include, among other items, due diligence reports, appraisal reports, any studies commissioned by GC Advisors and travel and lodging
expenses;
expenses related to unsuccessful portfolio acquisition efforts;
offerings of our common stock and other securities;
administration fees and expenses, if any, payable under the Administration Agreement (including payments based upon our allocable portion of the Administrator’s overhead in
performing its obligations under the Administration Agreement, including rent and the allocable portion of the cost of our chief compliance officer, chief financial officer and their
respective staffs);
fees payable to third parties, including agents, consultants or other advisors, relating to, or associated with, evaluating and making investments in portfolio companies,
including costs associated with meeting financial sponsors;
transfer agent, dividend agent and custodial fees and expenses;
U.S. federal and state registration and franchise fees;
all costs of registration and listing our shares on any securities exchange;
U.S. federal, state and local taxes;
independent directors’ fees and expenses;
costs of preparing and filing reports or other documents required by the SEC or other regulators;
costs of any reports, proxy statements or other notices to stockholders, including printing costs;
costs associated with individual or group stockholders;
costs associated with compliance under the Sarbanes-Oxley Act;
our allocable portion of any fidelity bond, directors and officers/errors and omissions liability insurance, and any other insurance premiums;
direct costs and expenses of administration, including printing, mailing, long distance telephone, copying, secretarial and other staff, independent auditors and outside legal
costs;
proxy voting expenses; and
all other expenses incurred by us or the Administrator in connection with administering our business.
We expect our general and administrative expenses to be relatively stable or decline as a percentage of total assets during periods of asset growth and to increase during periods of
asset declines.
GC Advisors, as collateral manager for the 2018 Issuer under a collateral management agreement, or the 2018 Collateral Management Agreement, is entitled to receive an annual fee
in an amount equal to 0.25% of the principal balance of the portfolio loans held by the 2018 Issuer at the beginning of the collection period relating to each payment date, which is
payable in arrears on each payment date. Under the 2018 Collateral Management Agreement, the term "collection period" refers to the period commencing on the third business day
prior to the preceding payment date and ending on (but excluding) the third business day prior to such payment date.
GC Advisors, as collateral manager for Golub Capital Investment Corporation CLO II LLC, or the GCIC 2018 Issuer, under a collateral management agreement, or the GCIC 2018
Collateral Management Agreement, is entitled to receive an annual fee in an amount equal to 0.35% of the principal balance of the portfolio loans held by the GCIC 2018 Issuer at the
beginning of the collection
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period relating to each payment date, which is payable in arrears on each payment date. Under the 2018 GCIC Collateral Management Agreement, the term “collection period”
generally refers to a quarterly period commencing on the day after the end of the prior collection period to the tenth business day prior to the payment date.
Prior to the redemption of the 2020 Notes and the termination of the documents governing the 2020 Debt
Securitization on August 26, 2021, GC Advisors served as collateral manager for Golub Capital BDC CLO 4 LLC,
or the 2020 Issuer, under a collateral management agreement, or the 2020 Collateral Management Agreement, and
was entitled to receive an annual fee in an amount equal to 0.35% of the principal balance of the portfolio loans held
by the 2020 Issuer at the beginning of the collection period relating to each payment date, which is payable in
arrears on each payment date. Under the 2020 Collateral Management Agreement, the term “collection period”
generally referred to a quarterly period commencing on the day after the end of the prior collection period to the
tenth business day prior to the payment date.
Collateral management fees were paid directly by the 2020 Issuer and are paid directly by the 2018 Issuer and GCIC 2018 Issuer to GC Advisors and are offset against the
management fees payable under the Investment Advisory Agreement. The 2018 Issuer paid Morgan Stanley & Co. LLC structuring and placement fees for its services in connection
with the structuring of the 2018 Debt Securitization. Before we acquired the GCIC 2018 Issuer as part of our acquisition of GCIC (as defined in the “GCIC Acquisition” section below),
the GCIC 2018 Issuer paid Wells Fargo Securities, LLC structuring and placement fees for its services in connection with the initial structuring of the GCIC 2018 Debt Securitization.
The 2020 Issuer paid Wells Fargo Securities, LLC structuring and placement fees
for its services in connection with the structuring of the 2020 Debt Securitization. Term debt securitizations are also known as CLOs, and are a form of secured financing incurred by us,
which are consolidated by us and subject to our overall asset coverage requirement. The 2018 Issuer and GCIC 2018 Issuer also agreed to pay ongoing administrative expenses to the
trustee, collateral manager, independent accountants, legal counsel, rating agencies and independent managers in connection with developing and maintaining reports, and providing
required services in connection with the administration of the 2018 Debt Securitization and GCIC 2018 Debt Securitization and collectively the Debt Securitizations, as applicable.
We believe that these administrative expenses approximate the amount of ongoing fees and expenses that we would be required to pay in connection with a traditional secured credit
facility. Our common stockholders indirectly bear all of these expenses.
LIBOR Transition
In July 2017, the Financial Conduct Authority, or the FCA, announced its intention to cease sustaining the London Inter-Bank Offered Rate, or LIBOR, by the end of 2021.
Following their publication on June 30, 2023, no settings of the London Interbank Offered Rate, or LIBOR, continue to be published on a representative basis and publication of many
non-U.S. dollar LIBOR settings has been entirely discontinued.
On December 21, 2022, the Financial Accounting Standards Board issued Accounting Standards Update No. 2022-06 (or “ASU 2022-06”), which deferred the sunset of Topic 848,
Reference Rate Reform, until December 31, 2024. The issuance of ASU 2022-06 and the deferral of the sunset of Topic 848 eases the potential burden in accounting for the effects of
reference rate reform on financial reporting.
On July 29, 2021, the U.S. Federal Reserve System, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial
institutions, formally recommended replacing U.S.-dollar LIBOR with the Secured Overnight Financing Rate, or SOFR, a new index calculated by short-term repurchase agreements,
backed by Treasury securities. In April 2018, the Bank of England began publishing its proposed alternative rate, the Sterling Overnight Index Average, or SONIA. Each of SOFR and
SONIA significantly differ from LIBOR, both in the actual rate and how it is calculated.
Further, on March 15, 2022, the Consolidation Appropriations Act of 2022, which includes the Adjustable Interest Rate (LIBOR) Act, or the LIBOR Act, was signed into law in the United
States. This legislation establishes a uniform benchmark replacement process for certain financial contracts that mature after June 30, 2023 that do not contain clearly defined or
practicable LIBOR fallback provisions. The legislation also creates a safe harbor that
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shields lenders from litigation if they choose to utilize a replacement rate recommended by the Board of Governors of the Federal Reserve.
In addition, the U.K. Financial Conduct Authority, or FCA, which regulates the publisher of LIBOR (ICE Benchmark Administration) has announced that it will require the continued
publication of the one-, three- and six-month tenors of U.S.-dollar LIBOR on a non-representative synthetic basis until the end of September 2024, which may result in certain non-U.S.
law-governed contracts and U.S. law-governed contracts not covered by the federal legislation remaining on synthetic U.S.-dollar LIBOR until the end of this period.
Although the transition process away from LIBOR has become increasingly well-defined (e.g., the LIBOR Act now provides a uniform benchmark replacement for certain LIBOR-based
instruments in the United States), the transition process is complex and it could cause a disruption in the credit markets generally and could have adverse impacts on our business
financial condition and results of operations, including, among other things, increased volatility or illiquidity in markets for instruments that continue to rely on LIBOR or which have
been transitioned away from LIBOR to a different rate like SOFR and, in any case, could result in a reduction in the value of certain investments held by us.
In anticipation of the discontinuation of LIBOR, we assessed our debt facilities for our exposure to LIBOR. Effective September 2, 2022, the JPM Credit Facility was amended to replace
LIBOR with SOFR as an interest rate benchmark. Effective as of the first interest accrual period commencing after June 30, 2023, the indentures governing the notes offered in the
2018 Debt Securitization and GCIC 2018 Debt Securitization were amended to replace LIBOR with SOFR as the applicable reference rate. The 2024 Notes, 2026 Notes and 2027
Notes accrue fixed-rate interest and were not affected by the discontinuation of LIBOR. We expect any new debt facilities will reference a benchmark interest rate other than LIBOR,
such as SOFR.
Recent Developments
On October 6, 2023, we entered into an equity distribution agreement by and among us and various placement agents in connection with the sale by us of shares of our common stock,
par value $0.001 per share, having an aggregate offering price of up to $250.0 million, in amounts and at times to be determined by us. Actual sales, if any, will depend on a variety of
factors to be determined by us from time to time, including, among others, market conditions and the market price of our common stock.
On November 17, 2023, our Board declared a quarterly distribution of $0.37 per share, which is payable on December 29, 2023 to holders of record as of December 8, 2023, and a
supplemental distribution of $0.07 per share, which is payable on December 15, 2023 to holders of record as of December 1, 2023.
Consolidated Results of Operations
The comparison of the fiscal years ended September 30, 2022 and 2021 can be found in our Form 10-K for the fiscal year ended September 30, 2022 located within Item 7.
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
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Consolidated operating results for years ended September 30, 2023 and 2022 are as follows:
Interest income
Payment-in-kind interest income
Accretion of discounts and amortization of premiums
GCIC acquisition purchase premium amortization
Non-cash dividend income
Dividend income
Fee income
Total investment income
Total net expenses
Net investment income before taxes
Income and excise taxes
Net investment income after taxes
Net realized gain (loss) on investment transactions excluding purchase premium
Net realized gain (loss) on investment transactions due to purchase premium
Net change in unrealized appreciation (depreciation) on investment transactions excluding purchase premium
Net change in unrealized appreciation (depreciation) on investment transactions due to purchase premium
Net gain (loss) on investment transactions
(Provision) benefit for taxes on realized gain on investments
(Provision) benefit for taxes on unrealized appreciation on investments
Net increase (decrease) in net assets resulting from operations
Average earning debt investments, at fair value
Average earning preferred equity investments, at fair value
Year ended
September 30, 2023
September 30, 2022
(In thousands)
Variances
2023 vs. 2022
$
531,164
$
350,475
$
180,689
40,590
19,951
(7,073)
14,901
1,340
2,217
603,090
310,320
292,770
3,682
289,088
(43,812)
(301)
6,181
7,374
(30,558)
(207)
308
23,354
24,679
(15,632)
—
684
4,242
387,802
191,611
196,191
72
196,119
20,642
(266)
(77,796)
15,898
(41,522)
(302)
(855)
$
$
$
258,631
5,117,940
119,625
$
$
$
153,440
5,061,410
95,821
$
$
$
17,236
(4,728)
8,559
14,901
656
(2,025)
215,288
118,709
96,579
3,610
92,969
(64,454)
(35)
83,977
(8,524)
10,964
95
1,163
105,191
56,530
23,804
Net income can vary substantially from period to period for various reasons, including the recognition of realized gains and losses and unrealized appreciation and depreciation. As a
result, quarterly and year-to-date comparisons of net income may not be meaningful.
On September 16, 2019, we completed our acquisition of GCIC. The acquisition was accounted for under the asset acquisition method of accounting in accordance with ASC 805-50,
Business Combinations — Related Issues . Under asset acquisition accounting, where the consideration paid to GCIC’s stockholders exceeded the relative fair values of the assets
acquired and liabilities assumed, the premium paid by us was allocated to the cost of the GCIC assets acquired by us pro-rata based on their relative fair value. Immediately following
the acquisition of GCIC, we recorded its assets at their respective fair values and, as a result, the purchase premium allocated to the cost basis of the GCIC assets acquired was
immediately recognized as unrealized depreciation on our Consolidated Statement of Operations. The purchase premium allocated to investments in loan securities will amortize over
the life of the loans through interest income with a corresponding reversal of the unrealized depreciation on such loans acquired through their ultimate disposition. The purchase
premium allocated to investments in equity securities will not amortize over the life of the equity securities through interest income and, assuming no subsequent change to the fair
value of the equity securities acquired from GCIC and disposition of such equity securities at fair value, we will recognize a realized loss with a corresponding reversal of the unrealized
depreciation upon disposition of the equity securities acquired.
As a supplement to our GAAP financial measures, we have provided the following non-GAAP financial measures that we believe are useful for the reasons described below:
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•
•
•
•
“Adjusted Net Investment Income” - excludes the amortization of the purchase price premium from net investment income calculated in accordance with GAAP;
“Adjusted Net Investment Income Before Accrual for Capital Gain Incentive Fee” - Adjusted Net Investment Income excluding the accrual or reversal for the capital gain
incentive fee under GAAP;
“Adjusted Net Realized and Unrealized Gain/(Loss)” - excludes the unrealized loss resulting from the purchase premium write-down and the corresponding reversal of the
unrealized loss resulting from the amortization of the premium on loans or from the sale of equity investments from the determination of realized and unrealized gain/(loss)
determined in accordance with GAAP; and
“Adjusted Net Income” – calculates net income and earnings per share based on Adjusted Net Investment Income and Adjusted Net Realized and Unrealized Gain/(Loss).
Net investment income after taxes
Add: GCIC acquisition purchase premium amortization
Adjusted Net Investment Income
Net gain (loss) on investment transactions
Add: Realized loss on investment transactions due to purchase premium
Less: Net change in unrealized appreciation on investment transactions due to purchase premium
Adjusted Net Realized and Unrealized Gain/(Loss)
Net increase (decrease) in net assets resulting from operations
Add: GCIC acquisition purchase premium amortization
Add: Realized loss on investment transactions due to purchase premium
Less: Net change in unrealized appreciation on investment transactions due to purchase premium
Adjusted Net Income
Year ended
September 30, 2023
September 30, 2022
(In thousands)
$
$
$
$
$
$
289,088
7,073
296,161
(30,558)
301
(7,374)
(37,631)
258,631
7,073
301
(7,374)
258,631
$
$
$
$
$
$
196,119
15,632
211,751
(41,522)
266
(15,898)
(57,154)
153,440
15,632
266
(15,898)
153,440
We believe that excluding the financial impact of the purchase premium in the above non-GAAP financial measures is useful for investors as this is a non-cash expense/loss and is one
method we use to measure our results of operations. In addition, we believe that providing the Adjusted Net Investment Income Before Accrual for Capital Gain Incentive Fee is a
useful non-GAAP financial measure as such accrual is not contractually payable under the terms of the Investment Advisory Agreement.
Although these non-GAAP financial measures are intended to enhance investors’ understanding of our business and performance, these non-GAAP financial measures should not be
considered an alternative to GAAP.
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Investment Income
Investment income increased from the year ended September 30, 2022 to the year ended September 30, 2023 by $215.3 million primarily due to an increase in interest income due to
rising LIBOR and SOFR interest base rates coupled with an increase in the average earning debt investments balance of $56.5 million, an increase in non-cash dividend income and a
decrease of the GCIC acquisition purchase price premium amortization.
The annualized income yield by debt security type for years ended September 30, 2023 and 2022 are as follows:
Senior secured
One stop
Second lien
Subordinated debt
Year ended
September 30, 2023
10.1%
11.2%
13.6%
14.6%
September 30, 2022
6.4%
7.5%
9.0%
12.1%
Income yields on senior secured and one stop loans increased for the year ended September 30, 2023 as compared to the year ended September 30, 2022, primarily due to rising
LIBOR and SOFR rates. Our loan portfolio is partially insulated from a drop in floating interest rates, as 97.6% of the loan portfolio at fair value is subject to an interest rate floor. As of
both September 30, 2023 and September 30, 2022, the weighted average base rate floor of our loans was 0.80% and 0.83%, respectively.
As of September 30, 2023, we have second lien investments in five portfolio companies and subordinated debt investments in four portfolio companies as shown in the Consolidated
Schedule of Investments. Due to the limited number of second lien and subordinated debt investments, income yields on second lien and subordinated debt investments can be
significantly impacted by the addition, subtraction or refinancing of one investment.
For additional details on investment yields and asset mix, refer to the “ Liquidity and Capital Resources - Portfolio Composition, Investment Activity and Yield” section below.
Expenses
The following table summarizes our expenses for the years ended September 30, 2023 and 2022:
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Interest and other debt financing expenses
Amortization of debt issuance costs
Base management fee, net of waiver
Income incentive fee
Professional fees
Administrative service fee
General and administrative expenses
Net expenses
Average debt outstanding
Interest Expense
Year ended
September 30, 2023
September 30, 2022
(In thousands)
Variances
2023 vs. 2022
$
$
$
143,230
7,380
$
70,802
74,066
5,041
8,300
1,501
310,320
3,069,412
$
$
82,041
7,337
71,962
17,756
3,607
7,188
1,720
191,611
2,935,846
$
$
$
61,189
43
(1,160)
56,310
1,434
1,112
(219)
118,709
133,566
Interest and other debt financing expenses, including amortization of debt issuance costs, increased from the year ended September 30, 2022 to the year ended September 30, 2023
by $61.2 million, primarily due to an increase in average debt outstanding of $133.6 million as well as rising LIBOR and SOFR rates on borrowings from our floating rate debt facilities.
For more information about our outstanding borrowings for the years ended September 30, 2023 and 2022, including the terms thereof, see “Note 7. Borrowings” in the notes to our
consolidated financial statements and the “Liquidity and Capital Resources” section below.
For the years ended September 30, 2023 and 2022, the effective annualized average interest rate, which includes amortization of debt financing costs, amortization of discounts on
notes issued and non-usage facility fees, on our total debt was 4.9% and 3.0%, respectively.
The effective annualized average interest rate increased for the year ended September 30, 2023 compared to the year ended September 30, 2022 primarily due to rising interest rates
on our borrowings from floating rate debt facilities.
Management Fee
The base management fee, net of waiver, decreased from the year ended September 30, 2022 to the year ended September 30, 2023 primarily due to the base management fee rate
reduction to 1.0% from 1.375% effective July 1, 2023 under the Investment Advisory Agreement, as compared to the Prior Investment Advisory Agreement that was partially offset by
increased base management fees incurred due to an increase in average adjusted gross assets from 2022 to 2023 and the management fee waiver from the year ended September
30, 2022 described below.
Effective April 1, 2022, GC Advisors changed its practice of retaining administrative agent fees earned in respect of co-investment transactions in which we participate. In connection
with this change, for the three months ended March 31, 2022, GC Advisors voluntarily and irrevocably waived $1.9 million* of base management fees related to certain administrative
agent fees received by GC Advisors prior to this change. The waiver had the net economic effect of providing us an amount equal to our pro rata portion of administrative agent fees
earned by GC Advisors from our borrowers.
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*
The net economic effect represents $6.5 million of GBDC’s pro rata portion of administrative agent fees retained by GC Advisors since the exemptive relief issued to GBDC and its affiliates on February 27,
2017, reduced by $4.6 million of the additional incentive fees GC Advisors would have earned on the pro rata portion of administrative agent fees.
Incentive Fees
The incentive fee payable under the Investment Advisory Agreement consists of two parts: (1) the Income Incentive Fee and (2) the Capital Gain Incentive Fee.
The Income Incentive Fee increased by $56.3 million from the year ended September 30, 2022 to the year ended September 30, 2023 primarily as a result of an increase in Pre-
Incentive Fee Net Investment Income and a greater rate of return on the value of our net assets driven by net funds growth, the impact of rising LIBOR and SOFR rates and an
increase in non-cash dividend income during fiscal year 2023. For the year ended September 30, 2023 and for the quarter ended September 30, 2022, we were fully through the
Income Incentive Fee “catch-up” provision and the Income Incentive Fee was equal to 20% of Pre-Incentive Fee Net Investment Income. For the first three quarters of the year ended
September 30, 2022, we remained in the Income Incentive Fee catch-up provision of the calculation and an increase in Pre-Incentive Fee Net Investment Income caused a
corresponding increase in the Income Incentive fee.
The Income Incentive Fee as a percentage of Pre-Incentive Fee Net Investment Income was 20.0% for the year ended September 30, 2023.
percentage of Pre-Incentive Fee Net Investment Income was 8.3% for the year ended September 30, 2022.
The Income Incentive Fee as a
As of September 30, 2023 and September 30, 2022 , there was no Capital Gain Incentive Fee payable as calculated under the Investment Advisory Agreement. In accordance with
GAAP, we are required to include the aggregate unrealized capital appreciation on investments in the calculation and accrue a capital gain incentive fee as if such unrealized capital
appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the Investment Advisory
Agreement. As of September 30, 2023 and September 30, 2022 , there was no capital gain incentive fee accrual calculated in accordance with GAAP. Any payment due under the
terms of the Investment Advisory Agreement is calculated in arrears at the end of each calendar year. No Capital Gain Incentive Fees as calculated under the Investment Advisory
Agreement or any prior investment advisory agreements, as applicable, have been payable since December 31, 2018.
For additional details on unrealized appreciation and depreciation of investments, refer to the “ Net Realized and Unrealized Gains and Losses” section below.
Professional Fees, Administrative Service Fee, and General and Administrative Expenses
In total, professional fees, the administrative service fee, and general and administrative expenses increased by $2.3 million from the year ended September 30, 2022 to the year
ended September 30, 2023 primarily due to an increase in the administrative service fee and professional fees.
The Administrator pays for certain expenses incurred by us. These expenses are subsequently reimbursed in cash.
Total expenses reimbursed to the Administrator during the years ended September 30, 2023 and 2022 were $8.2 million and $6.2 million, respectively.
As of both September 30, 2023 and September 30, 2022 , included in accounts payable and other liabilities were $2.0 million of expenses paid on behalf of us by the Administrator.
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Net Realized and Unrealized Gains and Losses
The following table summarizes our net realized and unrealized gains (losses) for years ended September 30, 2023 and 2022:
Net realized gain (loss) from investments
Net realized gain (loss) from foreign currency transactions
Net realized gain (loss) from forward currency contracts
Net realized gain (loss) on investment transactions
Unrealized appreciation from investments
Unrealized (depreciation) from investments
Unrealized appreciation (depreciation) from forward currency contracts
Unrealized appreciation (depreciation) on foreign currency translation
Net change in unrealized appreciation (depreciation) on investment transactions
Year ended
Variances
September 30, 2023
September 30, 2022
2023 vs. 2022
(In thousands)
$
$
$
$
(46,496)
(328)
2,711
(44,113)
$
100,427
(86,160)
(17,392)
16,680
$
18,925
371
1,080
20,376
$
53,327
(110,133)
32,243
(37,335)
13,555
$
(61,898)
$
(65,421)
(699)
1,631
(64,489)
47,100
23,973
(49,635)
54,015
75,453
During the year ended September 30, 2023, we had a net realized loss of $44.1 million primarily attributable to the realized loss recognized on the restructuring of debt investments of
multiple portfolio companies and the disposition of equity and debt investments of multiple portfolio company investments that were partially offset by realized gains on the sale of equity
investments in multiple portfolio companies and gains on the settlement of forward currency contracts. During the year ended September 30, 2022, we had a net realized gain of $20.4
million, primarily attributable to recognized realized gains on the sale of equity investments in multiple portfolio companies and the gain on the settlement of a forward currency contract,
partially offset by recognized realized losses on the restructure, sale, or write-off on multiple portfolio companies and net realized losses recognized due to the repayment of non-U.S.
dollar denominated debt.
For the year ended September 30, 2023, we had $100.4 million in unrealized appreciation on 191 portfolio company investments, which was offset by $86.2 million in unrealized
depreciation on 179 portfolio company investments. For the year ended September 30, 2022, we had $53.3 million in unrealized appreciation on 159 portfolio company investments,
which was offset by $110.1 million in unrealized depreciation on 234 portfolio company investments. Unrealized appreciation for the year ended September 30, 2023 primarily resulted
from the reversal of unrealized depreciation on the sale, restructuring or disposition of portfolio company investments, loan repayments and improved performance of certain portfolio
companies. Unrealized appreciation for the year ended September 30, 2022 primarily resulted from better than expected performance of our portfolio companies.
Unrealized depreciation for the year ended September 30, 2023 primarily resulted from decreases in the fair value across our portfolio company investments due to incremental spread
widening in the market during the first quarter of the 2023 fiscal year and isolated deterioration in the credit performance of a small number of portfolio companies. Unrealized
depreciation for the year ended September 30, 2022 primarily resulted from decreases in the fair value in the majority of our portfolio company investments due to wider credit spreads
in the market during the last two quarters of the 2022 fiscal year and the reversal of unrealized appreciation recognized in connection with realized gains on the sale of portfolio
company investments.
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Liquidity and Capital Resources
For the year ended September 30, 2023, we experienced a net decrease in cash and cash equivalents, foreign currencies and restricted cash and cash equivalents of $40.2 million.
During the period, cash provided by operating activities was $195.4 million, primarily driven by proceeds from principal payments and sales of portfolio investments of $670.2 million
and net investment income after excise tax of $289.1 million, offset by fundings of portfolio investments of $675.3 million. Lastly, cash used in financing activities was $235.5 million,
primarily driven by repayments of debt of $627.1 million, distributions paid of $191.5 million and purchases of common stock for the DRIP of $46.9 million, offset by borrowings on debt
of $652.6 million.
For the year ended September 30, 2022, we experienced a net decrease in cash, cash equivalents, foreign currencies, restricted cash and cash equivalents and restricted foreign
currencies of $63.3 million. During the period, cash used in operating activities was $416.5 million, primarily driven by fundings of portfolio investments of $1.88 billion, offset by
proceeds from principal payments and sales of portfolio investments of $1.26 billion and net investment income of $196.1 million. Lastly, cash provided by financing activities was
$353.1 million, primarily driven by borrowings on debt of $1.29 billion, offset by repayments of debt of $741.2 million, distributions paid of $155.2 million and purchases of common stock
under the DRIP of $36.4 million.
As of September 30, 2023 and September 30, 2022, we had cash and cash equivalents of $65.6 million and $117.3 million, respectively. In addition, we had foreign currencies of $4.2
million and $6.8 million as of September 30, 2023 and September 30, 2022, respectively, restricted cash and cash equivalents of $70.4 million and $56.4 million as of September 30,
2023 and September 30, 2022, respectively, and no restricted foreign currencies as of both September 30, 2023 and September 30, 2022. Cash and cash equivalents and foreign
currencies are available to fund new investments, pay operating expenses and pay distributions. Restricted cash and cash equivalents and restricted foreign currencies can be used to
pay principal and interest on borrowings and to fund new investments that meet the guidelines under our debt securitizations or credit facilities, as applicable.
Revolving Debt Facilities
JPM Credit Facility - On February 11, 2021, we entered into the JPM Credit Facility, which, as of September 30, 2023, allowed us to borrow up to $1.49 billion at any one time
outstanding, subject to leverage and borrowing base restrictions. As of September 30, 2023 and 2022, we had outstanding debt under the JPM Credit Facility of $784.4 million and
$692.6 million, respectively. As of September 30, 2023 and September 30, 2022, subject to leverage and borrowing base restrictions, we had $703.1 million and $544.9 million,
respectively, of remaining availability on the JPM Credit Facility.
Adviser Revolver - On June 22, 2016, we entered into the Adviser Revolver (as defined in Note 7 of our consolidated financial statements), which, as amended, permitted us to borrow
up to $100.0 million at any one time outstanding as of September 30, 2023. We entered into the Adviser Revolver in order to have the ability to borrow funds on a short-term basis and
have in the past repaid, and generally intend in the future to repay, borrowings under the Adviser Revolver within 30 to 45 days from which they are drawn. As of both September 30,
2023 and September 30, 2022, we had no amounts outstanding on the Adviser Revolver.
Debt Securitizations
2018 Debt Securitization - On November 16, 2018, we completed the 2018 Debt Securitization. The Class A, Class B and Class C-1 2018 Notes are included in the September 30,
2023 and September 30, 2022 Consolidated Statements of Financial Condition as our debt, and the Class C-2, Class D and Subordinated 2018 Notes were eliminated in consolidation.
As of September 30, 2023 and September 30, 2022, we had outstanding debt under the 2018 Debt Securitization of $388.7 million and $408.2 million, respectively.
GCIC 2018 Debt Securitization - Effective September 16, 2019, we assumed as a result of the Merger, the GCIC 2018 Debt Securitization. The Class A-1, Class A-2 (Class A-2-R
GCIC 2018 Notes after refinancing on December 21, 2020) and Class B-1 GCIC 2018 Notes are included in the September 30, 2023 and September 30, 2022 Consolidated
Statements of Financial Condition as our debt, and the Class B-2, Class C and Class D GCIC 2018 Notes and the Subordinated GCIC 2018 Notes were eliminated in consolidation. As
of September 30, 2023 and
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September 30, 2022, we had outstanding debt under the GCIC 2018 Debt Securitization of $513.5 million and $546.5 million, respectively.
Due to the interplay of the 1940 Act restrictions on principal and joint transactions and the U.S. risk retention rules adopted pursuant to Section 941 of Dodd-Frank, as a business
development company, we sought and received no action relief from the SEC to ensure we could engage in CLO financings in which assets are transferred through GC Advisors.
2024 Notes
On October 2, 2020, we issued $400.0 million in aggregate principal amount of the 2024 Notes. On October 15, 2021, we issued an additional $100.0 million in aggregate principal of
the 2024 Notes. As of both September 30, 2023 and September 30, 2022, we had $500.0 million of outstanding aggregate principal amount of the 2024 Notes.
2026 Notes
On February 24, 2021, we issued $400.0 million in aggregate principal amount of the 2026 Notes. On October 13, 2021, we issued an additional $200.0 million in aggregate principal of
the 2026 Notes. As of both September 30, 2023 and September 30, 2022, we had $600.0 million of outstanding aggregate principal amount of the 2026 Notes.
2027 Notes
On July 27, 2021, we issued $350.0 million in aggregate principal amount of the 2027 Notes, all of which remained outstanding as our debt as of both September 30, 2023 and
September 30, 2022.
Equity Distribution Agreement
On May 28, 2021, we entered into an equity distribution agreement, or the Equity Distribution Agreement, in connection with the launch of an at the market program to sell up to $250.0
million of shares of our common stock. An at the market offering is a registered offering by a publicly traded issuer of its listed equity securities that allows the issuer to sell shares
directly into the market at market prices. As of both September 30, 2023 and September 30, 2022, there have been no common stock issuances under the Equity Distribution
Agreement.
Asset Coverage, Contractual Obligations, Off-Balance Sheet Arrangements and Other Liquidity Considerations
As of September 30, 2023, in accordance with the 1940 Act, with certain limited exceptions, we were allowed to borrow amounts such that our asset coverage, as defined in the 1940
Act, is at least 150% after such borrowing. Prior to February 6, 2019, in accordance with the 1940 Act, with certain limited exceptions, we were allowed to borrow amounts such that our
asset coverage, as defined in the 1940 Act, was at least 200% after such borrowing. We currently intend to continue to target a GAAP debt-to-equity ratio between 0.85x to 1.25x. As of
September 30, 2023, our asset coverage for borrowed amounts and GAAP debt-to-equity ratio was 180.7% and 1.24x, respectively, and our effective GAAP debt-to-equity ratio, which
reduces total debt by cash, cash equivalents and foreign currencies, was 1.21x as of September 30, 2023.
On August 5, 2022, our board of directors approved the Program (as defined in Note 2 of our consolidated financial statements), which allows us to repurchase up to $150 million of our
outstanding common stock on the open market at prices below the NAV per share as reported in our then most recently published consolidated financial statements. The Program is
implemented at the discretion of management with shares to be purchased from time to time at prevailing market prices, through open market transactions, including block transactions,
pursuant to Rule 10b-18 under the Securities Exchange Act of 1934, as amended. During the year ended September 30, 2023,
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we repurchased 1,300,928 shares of our common stock pursuant to the Program for an aggregate purchase price of approximately $16.9 million. We did not make any repurchases of
our common stock during the year ended September 30, 2022. On August 3, 2023, our board of directors reauthorized $150 million of share repurchases pursuant to the Program,
exclusive of shares repurchased prior to the date of such authorization.
As of September 30, 2023 and September 30, 2022, we had outstanding commitments to fund investments totaling $189.4 million and $224.6 million, respectively. As of September 30,
2023, total commitments of $189.4 million included $39.7 million of unfunded commitments on revolvers. There is no guarantee that these amounts will be funded to the borrowing party
now or in the future. The unfunded commitments relate to loans with various maturity dates, but the entire amount was eligible for funding to the borrowers, subject to the terms of each
loan’s respective credit agreement. A summary of maturity requirements for our principal borrowings as of September 30, 2023 is included in Note 7 of our consolidated financial
statements. We did not have any other material contractual payment obligations as of September 30, 2023. As of September 30, 2023, we believe that we had sufficient assets and
liquidity to adequately cover future obligations under our unfunded commitments based on historical rates of drawings upon unfunded commitments, cash and restricted cash balances
that we maintain, availability under the Adviser Revolver and JPM Credit
Facility, as well as ongoing principal repayments on debt investments. In addition, we generally hold some syndicated loans in larger portfolio companies that are saleable over a
relatively short period to generate cash.
In addition, we have entered and, in the future, may again enter into derivative instruments that contain elements of off-balance sheet market and credit risk. Refer to Note 5 of our
consolidated financial statements for outstanding forward currency contracts as of September 30, 2023 and September 30, 2022. Derivative instruments can be affected by market
conditions, such as interest rate volatility, which could impact the fair value of the derivative instruments. If market conditions move against us, we may not achieve the anticipated
benefits of the derivative instruments and may realize a loss. We minimize market risk through monitoring its investments and borrowings.
Although we expect to fund the growth of our investment portfolio through the net proceeds from future securities offerings and future borrowings, to the extent permitted by the 1940
Act, we cannot assure you that our efforts to raise capital will be successful. In addition, from time to time, we can amend or refinance our leverage facilities and securitization
financings, to the extent permitted by applicable law. In addition to capital not being available, it also could not be available on favorable terms. To the extent we are not able to raise
capital on what we believe are favorable terms, we will focus on optimizing returns by investing capital generated from repayments into new investments we believe are attractive from
a risk/reward perspective. Furthermore, to the extent we are not able to raise capital and are at or near our targeted leverage ratios, we expect to receive smaller allocations, if any, on
new investment opportunities under GC Advisors’ allocation policy and have, in the past, received such smaller allocations under similar circumstances.
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Portfolio Composition, Investment Activity and Yield
As of September 30, 2023 and September 30, 2022, we had investments in 342 and 331 portfolio companies, respectively, with a total fair value of $5.5 billion and $5.4 billion,
respectively.
The following table shows the asset mix of our new investment commitments for years ended September 30, 2023 and 2022:
Senior secured
One stop
Second lien
Subordinated debt
Equity
Total new investment commitments
* Represents an amount less than 0.1%.
September 30, 2023
September 30, 2022
(In thousands)
Percentage
(In thousands)
Percentage
Year ended
$
$
20,700
596,306
9,774
50
17,784
644,614
3.2 % $
92.5
1.5
0.0
2.8
*
100.0 % $
64,645
1,642,741
640
988
108,200
1,817,214
3.6 %
90.4
0.0
0.0
6.0
*
*
100.0 %
For the year ended September 30, 2023, we had approximately $670.2 million in proceeds from principal payments and sales of portfolio investments.
For the year ended September 30, 2022, we had approximately $1,260.8 million in proceeds from principal payments and sales of portfolio investments.
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The following table shows the principal, amortized cost and fair value of our portfolio of investments by asset class:
Senior secured:
Performing
Non-accrual
(3)
One stop:
Performing
Non-accrual
(3)
Second lien:
(3)
Performing
Non-accrual
Subordinated debt:
Performing
Non-accrual
(3)
Equity
Total
Principal
(1)
As of September 30, 2023
Amortized
Cost
(In thousands)
Fair
Value
Principal
(2)
As of September 30, 2022
Amortized
Cost
(In thousands)
Fair
Value
$
$
517,091
1,630
$
525,896
1,553
$
503,594
391
$
479,354
39,834
$
496,870
21,346
$
4,708,376
104,611
27,944
4,229
4,585
4,322
N/A
5,372,788
$
4,685,989
77,139
29,789
3,725
4,538
3,328
261,879
5,593,836
$
4,620,406
57,693
27,758
1,396
4,488
3,457
297,430
5,516,613
$
4,706,125
95,475
25,801
—
3,869
—
N/A
5,350,458
$
4,710,508
75,610
29,337
—
3,814
—
232,119
5,569,604
$
461,935
10,938
4,614,422
54,187
23,240
—
3,815
—
277,819
5,446,356
(1)
(2)
(3)
As of September 30, 2023, $934.2 million and $887.2 million of our loans at amortized cost and fair value, respectively, included a feature permitting a portion of the interest due on such loan to be PIK interest. As
of September 30, 2023, $85.7 million and $63.1 million at amortized cost and fair value, respectively, of our loans with a PIK feature were on non-accrual status.
As of September 30, 2022, $730.9 million and $666.0 million of our loans at amortized cost and fair value, respectively, included a feature permitting a portion of the interest due on such loan to be PIK interest. As
of September 30, 2022, $83.5 million and $54.2 million at amortized cost and fair value, respectively, of our loans with a PIK feature were on non-accrual status.
We refer to a loan as non-accrual when we cease recognizing interest income on the loan because we have stopped pursuing repayment of the loan or, in certain circumstances, it is past due 90 days or more on
principal and interest or our management has reasonable doubt that principal or interest will be collected. See “— Critical Accounting Policies — Revenue Recognition.”
As of September 30, 2023, we had loans in nine portfolio companies on non-accrual status, and non-accrual
investments as a percentage of total debt investments at cost and fair value were 1.6% and 1.2%, respectively. As of September 30, 2022, we had loans in eight portfolio companies on
non-accrual status, and non-accrual investments as a percentage of total investments at cost and fair value were 1.8% and 1.3%, respectively.
As of September 30, 2023 and September 30, 2022, the fair value of our debt investments as a percentage of the outstanding principal value was 97.1% and 96.6%, respectively.
The following table shows the weighted average rate, spread over the applicable base rate of floating rate and fees of investments originated and the weighted average rate of sales
and payoffs of portfolio companies during the years ended September 30, 2023 and 2022:
Weighted average rate of new investment fundings
Weighted average spread over the applicable base rate of new floating rate investment fundings
Weighted average fees of new investment fundings
Weighted average rate of sales and payoffs of portfolio investments
September 30, 2023
September 30, 2022
Year ended
11.6%
6.5%
1.7%
9.8%
7.1%
5.9%
1.2%
6.6%
As of September 30, 2023, 97.2% and 97.6% of our debt portfolio at amortized cost and at fair value, respectively, had interest rate floors that limit the minimum applicable interest rates
on such loans. As of September 30, 2022, 97.9% and 98.1% of our debt portfolio at amortized cost and at fair value, respectively, had interest rate floors that limit the minimum
applicable interest rates on such loans.
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As of September 30, 2023 and 2022, the portfolio median earnings before interest, taxes, depreciation and amortization, or EBITDA, for our portfolio companies was $58.8 million and
$51.6 million, respectively. The portfolio median EBITDA is based on the most recently reported trailing twelve-month EBITDA received from the portfolio company.
1
As part of the monitoring process, GC Advisors regularly assesses the risk profile of each of our investments and rates each of them based on an internal system developed by Golub
Capital and its affiliates. This system is not generally accepted in our industry or used by our competitors. It is based on the following categories, which we refer to as GC Advisors’
internal performance ratings:
Internal Performance Ratings
Rating
Definition
5
4
3
2
1
Involves the least amount of risk in our portfolio. The borrower is performing above expectations, and the trends and risk factors are generally favorable.
Involves an acceptable level of risk that is similar to the risk at the time of origination. The borrower is generally performing as expected, and the risk factors are
neutral to favorable.
Involves a borrower performing below expectations and indicates that the loan’s risk has increased somewhat since origination. The borrower could be out of
compliance with debt covenants; however, loan payments are generally not past due.
Involves a borrower performing materially below expectations and indicates that the loan’s risk has increased materially since origination. In addition to the
borrower being generally out of compliance with debt covenants, loan payments could be past due (but generally not more than 180 days past due).
Involves a borrower performing substantially below expectations and indicates that the loan’s risk has substantially increased since origination. Most or all of the
debt covenants are out of compliance and payments are substantially delinquent. Loans rated 1 are not anticipated to be repaid in full and we will reduce the fair
market value of the loan to the amount we anticipate will be recovered.
Our internal performance ratings do not constitute any rating of investments by a nationally recognized statistical rating organization or represent or reflect any third-party assessment
of any of our investments.
For any investment rated 1, 2 or 3, GC Advisors will increase its monitoring intensity and prepare regular updates for the investment committee, summarizing current operating results
and material impending events and suggesting recommended actions.
GC Advisors monitors and, when appropriate, changes the internal performance ratings assigned to each investment in our portfolio. In connection with our valuation process, GC
Advisors and our board of directors review these internal performance ratings on a quarterly basis.
1
The portfolio median EBITDA is based on our portfolio of debt investments and excludes (i) portfolio companies with negative or de minimis EBITDA, (ii) investments designated as
recurring revenue loans and (iii) portfolio companies with any loans on non-accrual status.
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The following table shows the distribution of our investments on the 1 to 5 internal performance rating scale at fair value as of September 30, 2023 and September 30, 2022:
Internal
Performance
Rating
5
4
3
2
1
Total
As of September 30, 2023
As of September 30, 2022
Investments
at Fair Value
(In thousands)
50,279
4,647,644
803,724
14,966
—
5,516,613
$
$
Percentage of
Total
Investments
0.9%
84.2
14.6
0.3
—
100.0%
Investments
at Fair Value
(In thousands)
252,572
4,725,988
398,625
69,171
—
5,446,356
$
$
Percentage of
Total
Investments
4.6%
86.8
7.3
1.3
—
100.0%
The table below details the weighted average price of our debt investments by internal performance rating held as of September 30, 2023 and 2022.
Category
Internal Performance Ratings 4 and 5
(Performing At or Above Expectations)
Internal Performance Rating 3
(Performing Below Expectations)
Internal Performance Ratings 1 and 2
(Performing Materially Below Expectations)
As of September 30, 2023
As of September 30, 2022
Weighted Average Price
1
98.9%
91.3
27.6
97.1%
Total
98.6%
90.8
45.9
96.6%
(1)
Includes only debt investments held as of September 30, 2023 and September 30, 2022. Value reflects weighted average fair value of debt investments as a percentage of principal by Internal Performance Rating
category.
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Distributions
We intend to make quarterly distributions to our stockholders as determined by our board of directors. For additional details on distributions, see “Income taxes” in Note 2 to our
consolidated financial statements.
We may not be able to achieve operating results that will allow us to make distributions at a specific level or to increase the amount of our distributions from time to time. In addition, the
asset coverage requirements applicable to us as a business development company under the 1940 Act could limit our ability to make distributions. If we do not distribute a certain
percentage of our income annually, we will suffer adverse U.S. federal income tax consequences, including the possible loss of our ability to be subject to tax as a RIC. We cannot
assure stockholders that they will receive any distributions.
Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations can differ from net investment income and realized gains recognized for
financial reporting purposes. Differences are permanent or temporary. Permanent differences are reclassified within capital accounts in the financial statements to reflect their tax
character. For example, permanent differences in classification result from the treatment of distributions paid from short-term gains as ordinary income dividends for tax purposes.
Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future.
To the extent our taxable earnings fall below the total amount of our distributions for any tax year, a portion of those distributions could be deemed a return of capital to our stockholders
for U.S. federal income tax purposes. Thus, the source of a distribution to our stockholders could be the original capital invested by the stockholder rather than our income or gains.
Stockholders should read any written disclosure accompanying a distribution payment carefully and should not assume that the source of any distribution is our ordinary income or
gains.
We have adopted an “opt out” dividend reinvestment plan for our common stockholders. As a result, if we declare a distribution, our stockholders’ cash distributions will be automatically
reinvested in additional shares of our common stock unless a stockholder specifically “opts out” of our dividend reinvestment plan. If a stockholder opts out, that stockholder will receive
cash distributions. Although distributions paid in the form of additional shares of our common stock will generally be subject to U.S. federal, state and local taxes in the same manner as
cash distributions, stockholders participating in our dividend reinvestment plan will not receive any corresponding cash distributions with which to pay any such applicable taxes.
Related Party Transactions
We have entered into a number of business relationships with affiliated or related parties, including the following:
• We entered into the Investment Advisory Agreement with GC Advisors. Mr. Lawrence Golub, our chairman, is a manager of GC Advisors, and Mr. David Golub, our chief
executive officer, is a manager of GC Advisors, and each of Messrs. Lawrence Golub and David Golub owns an indirect pecuniary interest in GC Advisors. The Board
approved the Investment Advisory Agreement on August 3, 2023, pursuant to which the base management fee rate is reduced from 1.375% to 1.0%.
• Golub Capital LLC provides, and other affiliates of Golub Capital have historically provided, us with the office facilities and administrative services necessary to conduct day-to-
day operations pursuant to our Administration Agreement.
• We have entered into a license agreement with Golub Capital LLC, pursuant to which Golub Capital LLC has granted us a non-exclusive, royalty-free license to use the name
“Golub Capital.”
•
Under the Staffing Agreement, Golub Capital LLC has agreed to provide GC Advisors with the resources necessary to fulfill its obligations under the Investment Advisory
Agreement. The Staffing Agreement provides that Golub Capital LLC will make available to GC Advisors experienced investment professionals and provide access to the
senior investment personnel of Golub Capital LLC for purposes of evaluating, negotiating, structuring, closing and monitoring our investments. The Staffing Agreement also
includes a commitment that the members of GC Advisors’ investment committee will serve in such capacity. Services under the Staffing Agreement are provided on a direct
cost reimbursement basis. We are not a party to the Staffing Agreement.
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• GC Advisors serves as collateral manager to the 2018 Issuer and the GCIC 2018 Issuer under the 2018 Collateral Management Agreement and the GCIC 2018 Collateral
Management Agreement, respectively. Fees payable to GC Advisors for providing these services offset against the base management fee payable by us under the Investment
Advisory Agreement.
• We have entered into the Adviser Revolver with GC Advisors in order to have the ability to borrow funds on a short-term basis.
•
During the third calendar quarter of 2023, the Golub Capital Employee Grant Program Rabbi Trust, or the Trust, purchased approxim ately $4.7 million, or 331,104 shares of our
common stock, for the purpose of awarding incentive compensation to employees of Golub Capital. Through the first three calendar quarters of 2023, the Trust purchased
During calendar
approximately $15.2 million, or 1,115,308 shares of our common stock, for the purpose of awarding incentive compensation to employees of Golub Capital.
year 2022, the Trust purchased approximately $56.7 million, or 4,140,641 shares of our common stock, for the purpose of awarding incentive compensation to employees of
Golub Capital.
• On September 16, 2019, we completed our acquisition of GCIC pursuant to the Merger Agreement.
GC Advisors also sponsors or manages, and expects in the future to sponsor or manage, other investment funds, accounts or investment vehicles (together referred to as “accounts”)
that have investment mandates that are similar, in whole and in part, with ours. For example, GC Advisors presently serves as the investment adviser to Golub
Capital BDC 3, Inc., or GBDC 3, Golub Capital Direct Lending Corporation, or GDLC, Golub Capital Direct Lending Unlevered Corporation, or GDLCU, Golub Capital BDC 4, Inc., or
GBDC 4, and Golub Capital Private Credit Fund, or GCRED, all of which are unlisted business development companies that primarily focus on investing in one stop and other senior
secured loans. In addition, our officers and directors serve in similar capacities for GBDC 3, GDLC, GDLCU, GBDC 4 and GCRED. If GC Advisors and its affiliates determine that an
investment is appropriate for us, GBDC 3, GDLC, GDLCU, GBDC 4, GCRED and other accounts, depending on the availability of such investment and other appropriate factors, and
pursuant to GC Advisors’ allocation policy, GC Advisors or its affiliates could determine that we should invest side-by-side with one or more other accounts. We do not intend to make
any investments if they are not permitted by applicable law and interpretive positions of the SEC and its staff, or if they are inconsistent with GC Advisors’ allocation procedures.
In addition, we have adopted a formal code of ethics that governs the conduct of our and GC Advisors’ officers, directors and employees. Our officers and directors also remain subject
to the duties imposed by both the 1940 Act and the General Corporation Law of the State of Delaware.
Critical Accounting Policies
The preparation of 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 financial statements and revenues and expenses during the periods reported. Actual results could
materially differ from those estimates. We have identified the following items as critical accounting policies.
Fair Value Measurements
We value investments for which market quotations are readily available at their market quotations. However, a readily available market value is not expected to exist for many of the
investments in our portfolio, and we value these portfolio investments at fair value as determined in good faith by our board of directors under our valuation policy and process.
Valuation methods include comparisons of the portfolio companies to peer companies that are public, determination of the enterprise value of a portfolio company, discounted cash flow
analysis and a market interest rate approach. The factors that are taken into account in fair value pricing investments include: available current market data, including relevant and
applicable market trading and transaction comparables; applicable market yields and multiples; security covenants; call protection provisions; information rights; the nature and
realizable value of any collateral; the portfolio company’s ability to make payments, its earnings and discounted cash flows and the markets
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in which it does business; comparisons of financial ratios of peer companies that are public; comparable merger and acquisition transactions; and the principal market and enterprise
values. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we will consider the pricing indicated by the external event to
corroborate the private equity valuation. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of
the investments can differ significantly from the values that would have been used had a readily available market value existed for such investments and differ materially from values
that are ultimately received or settled.
Our board of directors is ultimately and solely responsible for determining, in good faith, the fair value of investments that are not publicly traded, whose market prices are not readily
available on a quarterly basis or any other situation where portfolio investments require a fair value determination.
With respect to investments for which market quotations are not readily available, our board of directors undertakes a multi-step valuation process each quarter, as described below:
Our quarterly valuation process begins with each portfolio company investment being initially valued by the investment professionals of GC Advisors responsible for credit monitoring.
Preliminary valuation conclusions are then documented and discussed with our senior management and GC Advisors. The audit committee of our board of directors reviews these
preliminary valuations. At least once annually the valuation for each portfolio investment, subject to a de minimis threshold, is reviewed by an independent valuation firm. The board of
directors discusses valuations and determines the fair value of each investment in our portfolio in good faith.
Determination of fair values involves subjective judgments and estimates. Under current accounting standards, the notes to our consolidated financial statements refer to the
uncertainty with respect to the possible effect of such valuations, and any change in such valuations, on our consolidated financial statements.
We follow ASC Topic 820 for measuring fair value. Fair value is the price that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. Where available, fair value is based on observable market prices or parameters, or derived from such prices or parameters. Where
observable prices or inputs are not available, valuation models are applied. These valuation models involve some level of management estimation and judgment, the degree of which is
dependent on the price transparency for the assets or liabilities or market and the assets’ or liabilities’ complexity. Our fair value analysis includes an analysis of the value of any
unfunded loan commitments. Assets and liabilities are categorized for disclosure purposes based upon the level of judgment associated with the inputs used to measure their value.
The valuation hierarchical levels are based upon the transparency of the inputs to the valuation of the asset or liability as of the measurement date. The three levels are defined as
follows:
Level 1: Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
Level 2: Inputs include quoted prices for similar assets or liabilities in active markets and inputs that are observable for the assets or liabilities, either directly or indirectly, for
substantially the full term of the assets or liabilities.
Level 3: Inputs include significant unobservable inputs for the assets or liabilities and include situations where there is little, if any, market activity for the assets or liabilities. The
inputs into the determination of fair value are based upon the best information available and may require significant management judgment or estimation.
In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an asset’s or a liability’s categorization within the fair value
hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in
its entirety requires judgment, and we consider factors specific to the asset or liability. We assess the levels of assets and liabilities at each measurement date, and transfers between
levels are recognized on the actual date of the event or change in circumstances that caused the transfers. There were no transfers among Level 1, 2 and 3 of the fair value hierarchy
for assets and liabilities during the years ended September 30, 2023 and 2022. The following section describes the valuation techniques used by us to measure different assets and
liabilities at fair value and includes the level within the fair value hierarchy in which the assets and liabilities are categorized.
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Valuation of Investments
Level 1 investments are valued using quoted market prices. Level 2 investments are valued using market consensus prices that are corroborated by observable market data and
quoted market prices for similar assets and liabilities. Level 3 investments are valued at fair value as determined in good faith by our board of directors, based on input of management,
the audit committee and independent valuation firms that have been engaged at the direction of our board of directors to assist in the valuation of each portfolio investment without a
readily available market quotation at least once during a trailing twelve-month period under a valuation policy and a consistently applied valuation process. This valuation process is
conducted at the end of each fiscal quarter, with approximately 25% (based on the number of portfolio companies) of our valuations of debt and equity investments without readily
available market quotations subject to review by an independent valuation firm. All investments as of September 30, 2023, with the exception of one portfolio company investment
(Level 1 investments), were valued using Level 3 inputs. All investments as of September 30, 2022 were valued using Level 3 inputs. As of September 30, 2023 and September 30,
2022, all money market funds included in cash, cash equivalents and restricted cash and restricted cash equivalents were valued using Level 1 inputs and all forward currency
contracts were valued using Level 2 inputs.
When determining fair value of Level 3 debt and equity investments, we may take into account the following factors, where relevant: the enterprise value of a portfolio company, the
nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flows, the markets in which the portfolio company
does business, comparisons to publicly traded securities, and changes in the interest rate environment and the credit markets generally that may affect the price at which similar
investments may be made and other relevant factors. The primary method for determining enterprise value uses a multiple analysis whereby appropriate multiples are applied to the
portfolio company’s EBITDA. A portfolio company’s EBITDA may include pro-forma adjustments for items such as acquisitions, divestitures, or expense reductions. The enterprise
value analysis is performed to determine the value of equity investments and to determine if debt investments are credit impaired. If debt investments are credit impaired, we will use
the enterprise value analysis or a liquidation basis analysis to determine fair value. For debt investments that are not determined to be credit impaired, we use a market interest rate
yield analysis to determine fair value.
In addition, for certain debt investments, we may base our valuation on indicative bid and ask prices provided by an independent third party pricing service. Bid prices reflect the highest
price that we and others may be willing to pay. Ask prices represent the lowest price that we and others may be willing to accept. We generally use the midpoint of the bid/ask range as
our best estimate of fair value of such investment.
Due to the inherent uncertainty of determining the fair value of Level 3 investments that do not have a readily available market value, the fair value of the investments may differ
significantly from the values that would have been used had a market existed for such investments and may differ materially from the values that may ultimately be received or settled.
Further, such investments are generally subject to legal and other restrictions or otherwise are less liquid than publicly traded instruments. If we were required to liquidate a portfolio
investment in a forced or liquidation sale, we may realize significantly less than the value at which such investment had previously been recorded.
Our investments are subject to market risk. Market risk is the potential for changes in the value due to market changes. Market risk is directly impacted by the volatility and liquidity in
the markets in which the investments are traded.
Pursuant to Rule 2a-5 under the 1940 Act, as recently amended, the board of directors of a registered investment company or BDC is permitted to delegate to a valuation designee,
which could be its investment adviser, the responsibility to determine fair value of investments in good faith subject to the oversight of the board. Our board of directors has determined
to continue its determination of fair value of our investments for which market quotations are not readily available in accordance with our valuation policies and procedures and has not
designated GC Advisors or any other entity as a valuation designee.
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Valuation of Other Financial Assets and Liabilities
The fair value of the 2024 Notes, 2026 Notes and 2027 Notes is based on vendor pricing received by the Company, which is considered a Level 2 input. The fair value of our remaining
debt is estimated using Level 3 inputs by discounting remaining payments using comparable market rates or market quotes for similar instruments at the measurement date, if
available.
Revenue Recognition:
Our revenue recognition policies are as follows:
Investments and Related Investment Income: Interest income is accrued based upon the outstanding principal amount and contractual interest terms of debt investments. Premiums,
discounts, and origination fees are amortized or accreted into interest income over the life of the respective debt investment. For investments with contractual PIK interest, which
represents contractual interest accrued and added to the principal balance that generally becomes due at maturity, we do not accrue PIK interest if the portfolio company valuation
indicates that the PIK interest is not likely to be collectible. In addition, we may generate revenue in the form of amendment, structuring or due diligence fees, fees for providing
managerial assistance, administrative agent fees, consulting fees and prepayment premiums on loans and record these fees as fee income when earned. Loan origination fees, original
issue discount and market discount or premium are capitalized, and we accrete or amortize such amounts as interest income. We record prepayment premiums on loans as fee income.
Dividend income on preferred equity securities is recorded as dividend income on an accrual basis to the extent that such amounts are payable by the portfolio company and are
expected to be collected. We have certain preferred equity securities in our portfolio that contain a PIK dividend provision that are accrued and recorded as income at the contractual
rates, if deemed collectible. The accrued PIK and non-cash dividends are capitalized to the cost basis of the preferred equity security and are generally collected when redeemed by the
issuer. Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies.
Distributions received from limited liability company, or LLC, and limited partnership, or LP, investments are evaluated to determine if the distribution should be recorded as dividend
income or a return of capital. Generally, we will not record distributions from equity investments in LLCs and LPs as dividend income unless there are sufficient accumulated tax-basis
earnings and profits in the LLC or LP prior to the distribution. Distributions that are classified as a return of capital are recorded as a reduction in the cost basis of the investment.
We account for investment transactions on a trade-date basis. Realized gains or losses on investments are measured by the difference between the net proceeds from the disposition
and the cost basis of investment, without regard to unrealized gains or losses previously recognized. We report changes in fair value of investments from the prior period that is
measured at fair value as a component of the net change in unrealized appreciation (depreciation) on investment transactions in our Consolidated Statements of Operations and
fluctuations arising from the translation of foreign exchange rates on investments in unrealized appreciation (depreciation) on translation of assets and liabilities in foreign currencies on
the Consolidated Statements of Operations.
Non-accrual loans: Loans may be left on accrual status during the period we are pursuing repayment of the loan. Management reviews all loans that become past due 90 days or more
on principal and interest or when there is reasonable doubt that principal or interest will be collected for possible placement on non-accrual status. We generally reverse accrued
interest when a loan is placed on non-accrual. Additionally, any original issue discount and market discount are no longer accreted to interest income as of the date the loan is placed
on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment. We restore
non-accrual loans to accrual status when past due principal and interest is paid and, in our management’s judgment, are likely to remain current. The total fair value of our non-accrual
loans was $62.9 million and $65.1 million as of September 30, 2023 and September 30, 2022, respectively.
Income taxes: We have elected to be treated as a RIC under Subchapter M of the Code and operate in a manner so as to qualify for the tax treatment applicable to RICs. In order to
be subject to tax as a RIC, we are required to meet certain source of income and asset diversification requirements, as well as timely distribute to our stockholders dividends for U.S.
federal income tax purposes of an amount generally at least equal to 90% of investment company taxable income, as defined by the Code and determined without regard to any
deduction for dividends paid, for each tax year. We have made and intend to continue to make the requisite distributions to our stockholders, which will generally relieve us from U.S.
federal income taxes.
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Depending on the level of taxable income earned in a tax year, we may choose to retain taxable income in excess of current year dividend distributions and would distribute such
taxable income in the next tax year. We may then be required to incur a 4% excise tax on such income. To the extent that we determine that our estimated current year annual taxable
income, determined on a calendar year basis, could exceed estimated current calendar year dividend distributions, we accrue excise tax, if any, on estimated excess taxable income as
taxable income is earned. For the year ended September 30, 2023, $3.7 million was recorded for U.S. federal excise tax. For the years ended September 30, 2022 and 2021, we did
not incur U.S. federal excise tax.
We have consolidated subsidiaries that are subject to U.S. federal and state corporate-level income taxes. For the year ended September 30, 2023, we recorded a net tax benefit of
$0.1 million for taxable subsidiaries. For the years ended September 30, 2022 and 2021, we recorded a net tax expense of $1.2 million and $0.5 million, respectively, for taxable
subsidiaries. As of September 30, 2023 and September 30, 2022 we recorded a net deferred tax liability, reported within accounts payable and other liabilities on the Consolidated
Statement of Financial Condition, of $1.1 million and $1.4 million, respectively, for taxable subsidiaries, primarily due to unrealized appreciation on the investments held at the taxable
subsidiaries.
Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and realized gains recognized for
financial reporting purposes. Differences may be permanent or temporary. Permanent differences are reclassified within capital accounts in the financial statements to reflect their tax
character. For example, permanent differences in classification may result from the treatment of distributions paid from short-term gains as ordinary income dividends for tax purposes.
Temporary differences arise when certain items of income, expense, gain, or loss are recognized at some time in the future.
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Item 7A. Quantitative and Qualitative Disclosures about Market Risk
We are subject to financial market risks, including changes in interest rates. Many of the loans in our portfolio have floating interest rates, and we expect that our loans in the future may
also have floating interest rates. These loans are usually based on floating SOFR or another base rate and typically have interest rate reset provisions that adjust applicable interest
rates under such loans to current market rates on a daily, monthly, quarterly, semi-annual, or annual basis. The loans that are subject to floating SOFR or another base rate are also
typically subject to a minimum base rate, or floor, that we charge on our loans if the current market rates are below the respective floors. As of September 30, 2023 and September 30,
2022, the weighted average floor on loans subject to floating interest rates was 0.80% and 0.83%, respectively. The Class A, B and C-1 2018 Notes issued in connection with the 2018
Debt Securitization have floating rate interest provisions based on three-month SOFR that reset quarterly, as do the Class A-1 and B-1 GCIC 2018 Notes as issued as part of the GCIC
2018 Debt Securitization. The JPM Credit Facility has a floating interest rate provision that, as of September 30, 2023, is primarily based on an applicable base rate (as defined in Note
7) plus a spread that ranges from 1.75% to 1.875% plus a spread adjustment of 0.10% on SOFR borrowings. We expect that other credit facilities into which we enter in the future
could have floating interest rate provisions.
Assuming that the Consolidated Statement of Financial Condition as of September 30, 2023 were to remain constant and that we took no actions to alter interest rate sensitivity as of
such date, the following table shows the annualized impact of hypothetical base rate changes in interest rates.
Change in interest rates
Down 200 basis points
Down 150 basis points
Down 100 basis points
Down 50 basis points
Up 50 basis points
Up 100 basis points
Up 150 basis points
Up 200 basis points
Increase (decrease) in
interest income
(1)
Increase (decrease) in
interest expense
(In thousands)
Net increase
(decrease) in
investment income
$
$
(105,815)
(79,361)
(52,907)
(26,453)
26,453
52,907
79,361
105,815
$
(32,962)
(24,721)
(16,481)
(8,240)
8,240
16,481
24,721
32,962
(72,853)
(54,640)
(36,426)
(18,213)
18,213
36,426
54,640
72,853
(1)
Assumes applicable three-month base rate as of September 30, 2023, with the exception of SONIA and Prime that utilize the September 30, 2023 rate.
Although we believe that this analysis is indicative of our sensitivity to interest rate changes as of September 30, 2023, it does not adjust for changes in the credit market, credit quality,
the size and composition of the assets in our portfolio and other business developments, including borrowings under the Debt Securitizations, the JPM Credit Facility, Adviser Revolver,
or other borrowings, that could affect net increase in net assets resulting from operations, or net income. Accordingly, we can offer no assurances that actual results would not differ
materially from the analysis above.
We could in the future hedge against interest rate fluctuations by using standard hedging instruments such as interest rate swaps, futures, options and forward contracts to the limited
extent permitted under the 1940 Act and applicable commodities laws. While hedging activities may insulate us against adverse changes in interest rates, they may also limit our ability
to participate in the benefits of lower interest rates with respect to the investments in our portfolio with fixed interest rates.
117
Item 8. Consolidated Financial Statements and Supplementary Data
Index to Consolidated Financial Statements
Management’s Report on Internal Control over Financial Reporting
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42)
Consolidated Statements of Financial Condition as of September 30, 202 3 and 2022
Consolidated Statements of Operations for the Years Ended September 30, 202 3, 2022 and 2021
Consolidated Statements of Changes in Net Assets for the Years Ended September 30, 202 3, 2022 and 2021
Consolidated Statements of Cash Flows for the Years Ended September 30, 202 3, 2022 and 2021
Consolidated Schedules of Investments as of September 30, 2023 and 2022
Notes to the Consolidated Financial Statements
119
120
123
124
125
126
128
223
118
Management’s Report on Internal Control over Financial Reporting
The management of Golub Capital BDC, Inc. (“GBDC,” and collectively with its subsidiaries, the “Company,” “we,” “us,” “our” and “Golub Capital BDC”) is responsible for establishing
and maintaining adequate internal control over financial reporting. Our internal control system is a process designed to provide reasonable assurance to our management and board of
directors regarding the preparation and fair presentation of published financial statements.
Golub Capital BDC’s internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly
reflect transactions recorded necessary to permit the preparation of financial statements in accordance with U.S. generally accepted accounting principles. Our policies and procedures
also provide reasonable assurance that receipts and expenditures are being made only in accordance with authorizations of management and the directors of Golub Capital BDC, and
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial
statements.
All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance
with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness as to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Management assessed the effectiveness of Golub Capital BDC’s internal control over financial reporting as of September 30, 2023. In making this assessment, we used the criteria set
forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control — Integrated Framework issued in 2013. Based on the assessment, management
believes that, as of September 30, 2023, our internal control over financial reporting is effective based on those criteria
Golub Capital BDC’s independent registered public accounting firm that audited the financial statements has issued an audit report on the effectiveness of our internal control over
financial reporting as of September 30, 2023. This report appears on page 122.
119
To the Shareholders and the Board of Directors of Golub Capital BDC, Inc. and Subsidiaries
Report of Independent Registered Public Accounting Firm
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial condition of Golub Capital BDC, Inc. and Subsidiaries (the Company), including the consolidated schedules of
investments, as of September 30, 2023 and 2022, the related consolidated statements of operations, changes in net assets, and cash flows for each of the three years in the period
ended September 30, 2023, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly,
in all material respects, the financial position of the Company at September 30, 2023 and 2022, and the results of its operations, changes in its net assets, and its cash flows for each
of the three years in the period ended September 30, 2023, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial
reporting as of September 30, 2023, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission (2013 framework), and our report dated November 20, 2023 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our
audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws
and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the
financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the financial statements. Our procedures included confirmation of investments owned as of September 30, 2023 and 2022, by correspondence with the
custodians, the underlying investees and brokers. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as
evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the
audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex
judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by
communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the account or disclosures to which it relates.
120
Valuation of investments using significant unobservable inputs and assumptions
Description of the Matter
At September 30, 2023, the fair value of the Company’s investments categorized as Level 3 investments within the fair value hierarchy (Level 3
investments) totaled $5,516,513 thousand. Management determines the fair value of the Company’s Level 3 investments by applying the
methodologies outlined in Notes 2 and 6 to the consolidated financial statements and using significant unobservable inputs and assumptions.
Determining the fair value of the Level 3 investments requires management to make judgments about the valuation methodologies (i.e., market
approach or income approach) and significant unobservable inputs and assumptions including, among others, EBITDA multiples, revenue multiples,
and market interest rates for similar loans with similar credit profiles, used in determining the fair value measurements.
How We Addressed the Matter in
Our Audit
Auditing the fair value of the Company’s Level 3 investments was complex, as the unobservable inputs and assumptions used by the Company are
highly judgmental, are sensitive to economic dislocations, and could have a significant effect on the fair value measurements of such investments.
We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s investment valuation
process. This included controls over management’s assessment of the valuation methodologies and significant unobservable inputs and assumptions
used in determining the fair value measurements of the Level 3 investments.
Our audit procedures included, among others, evaluating the Company’s valuation methodologies, testing the significant unobservable inputs and
assumptions used by the Company in determining the fair value of the Company’s Level 3 investments, and testing the mathematical accuracy of the
Company’s valuation calculations. For a sample of the Company’s Level 3 investments, and in some cases, with the involvement of our valuation
specialists, we independently developed fair value estimates and compared them to the Company’s estimates. We developed our independent fair
value estimates by using borrower financial information, which we compared to confirmations sent to the borrowers or agreements or underlying
source documents provided to the Company by the borrowers, and available market information from third-party sources, such as market spreads,
market multiples, and leverage. In developing our independent fair value estimates, we considered the impact of current economic conditions on
trends in borrower financial information and the resulting fair value estimates. We also evaluated subsequent events and other available information
and considered whether they corroborated or contradicted the Company’s year-end valuations.
/s/ Ernst & Young LLP
We have served as the Company’s auditor since 2015.
Chicago, Illinois
November 20, 2023
121
To the Shareholders and the Board of Directors of Golub Capital BDC, Inc. and Subsidiaries
Opinion on Internal Control Over Financial Reporting
Report of Independent Registered Public Accounting Firm
We have audited Golub Capital BDC, Inc. and Subsidiaries’ internal control over financial reporting as of September 30, 2023, based on criteria established in Internal Control-
Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Golub Capital BDC,
Inc. and Subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of September 30, 2023, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial
condition, including the consolidated schedules of investments, of the Company as of September 30, 2023 and 2022, the related consolidated statements of operations, changes in net
assets, and cash flows for each of the three years in the period ended September 30, 2023, and the related notes and our report dated November 20, 2023 expressed an unqualified
opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial
reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal
control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in
accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether
effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and
operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our
audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and
procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2)
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles,
and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods
are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Chicago, Illinois
November 20, 2023
122
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Financial Condition
(In thousands, except share and per share data)
Assets
Investments, at fair value
Non-controlled/non-affiliate company investments
Non-controlled affiliate company investments
Controlled affiliate company investments
Total investments, at fair value (amortized cost of $5,593,836 and $5,569,604, respectively)
Cash and cash equivalents
Foreign currencies (cost of $4,540 and $7,021, respectively)
Restricted cash and cash equivalents
Interest receivable
Net unrealized appreciation on forward currency contracts
Other assets
Total Assets
Liabilities
Debt
Less unamortized debt issuance costs
Debt less unamortized debt issuance costs
Interest payable
Management and incentive fees payable
Accrued trustee fees
Accounts payable and other liabilities
Total Liabilities
Commitments and Contingencies (Note 9)
Net Assets
Preferred stock, par value $0.001 per share, 1,000,000 shares authorized, zero shares issued and outstanding as of
September 30, 2023 and September 30, 2022
Common stock, par value $0.001 per share, 350,000,000 shares authorized, 169,594,742 and 170,895,670 shares issued
and outstanding as of September 30, 2023 and September 30, 2022, respectively.
Paid in capital in excess of par
Distributable earnings (losses)
Total Net Assets
Total Liabilities and Total Net Assets
Number of common shares outstanding
Net asset value per common share
See Notes to Consolidated Financial Statements.
123
September 30, 2023
September 30, 2022
$
$
$
5,416,739
87,084
12,790
5,516,613
65,617
4,208
70,381
58,054
14,941
3,658
5,733,472
3,133,332
(15,613)
3,117,719
24,749
35,277
331
7,518
3,185,594
—
170
2,646,912
(99,204)
2,547,878
5,733,472
$
169,594,742
15.02 $
5,374,594
57,689
14,073
5,446,356
117,290
6,847
56,416
20,794
32,333
1,188
5,681,224
3,093,603
(17,211)
3,076,392
20,384
33,430
225
6,293
3,136,724
—
171
2,676,674
(132,345)
2,544,500
5,681,224
170,895,670
14.89
$
$
$
$
$
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Operations
(In thousands, except share and per share data)
2023
Year ended September 30,
2022
2021
$
355,358 $
Investment income
From non-controlled/non-affiliate company investments:
Interest income
Payment-in-kind interest income
Dividend income
Fee income
Total investment income from non-controlled/non-affiliate company investments
From non-controlled affiliate company investments:
Interest income
Payment-in-kind interest income
Fee income
Total investment income from non-controlled affiliate company investments
From controlled affiliate company investments:
(1)
Interest income
Payment-in-kind interest income
Fee income
Total investment income from controlled affiliate company investments
Total investment income
Expenses
Interest and other debt financing expenses
Base management fee
Incentive fee
Professional fees
Administrative service fee
General and administrative expenses
Total expenses
Base management fee waived (Note 3)
Net expenses
Net investment income - before tax
Excise tax
Income tax
Net investment income - after tax
Net gain (loss) on investment transactions
Net realized gain (loss) from:
Non-controlled/non-affiliate company investments
Non-controlled affiliate company investments
Controlled affiliate company investments
Foreign currency transactions
Forward currency contracts
Net realized gain (loss) on investment transactions
Net change in unrealized appreciation (depreciation) from:
Non-controlled/non-affiliate company investments
Non-controlled affiliate company investments
Controlled affiliate company investments
Translation of assets and liabilities in foreign currencies
Forward currency contracts
Net change in unrealized appreciation (depreciation) on investment transactions
Net gain (loss) on investment transactions
(Provision) benefit for taxes on realized gains on investments
(Provision) benefit for taxes on unrealized appreciation on investments
Net increase (decrease) in net assets resulting from operations
Per Common Share Data
Basic and diluted earnings per common share (Note 11)
Dividends and distributions declared per common share
Basic and diluted weighted average common shares outstanding (Note 11)
$
$
$
$
542,780
36,662
16,241
2,124
597,807
1,356
3,544
76
4,976
(94)
384
17
307
603,090
150,610
70,802
74,066
5,041
8,300
1,501
310,320
—
310,320
292,770
3,682
—
289,088
(45,889)
320
(927)
(328)
2,711
(44,113)
33,464
(18,578)
(619)
16,680
(17,392)
13,555
(30,558)
(207)
308
258,631
1.52
1.40
170,324,784
20,922
684
4,232
381,196
4,275
2,223
6
6,504
(111)
209
4
102
387,802
89,378
73,866
17,756
3,607
7,188
1,720
193,515
(1,904)
191,611
196,191
—
72
196,119
18,759
166
—
371
1,080
20,376
(43,796)
(6,886)
(6,124)
(37,335)
32,243
(61,898)
(41,522)
(302)
(855)
153,440 $
282,500
12,921
1,713
4,962
302,096
4,144
885
12
5,041
(137)
125
—
(12)
307,125
65,739
61,858
3,214
3,992
7,227
1,423
143,453
(4,000)
139,453
167,672
—
—
167,672
16,927
(3,921)
—
(5,101)
—
7,905
146,823
15,543
(499)
2,225
1,154
165,246
173,151
—
(543)
340,280
$
$
$
0.90 $
1.20 $
170,674,570
2.03
1.16
167,994,042
(1)
Negative interest income amounts are due to amortization of the GCIC acquisition purchase premium. Refer to Note 2 for additional details on the GCIC acquisition purchase premium.
See Notes to Consolidated Financial Statements.
124
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Changes in Net Assets
(In thousands, except share data)
Balance at September 30, 2020
Net increase (decrease) in net assets resulting from operations
Net investment income after taxes
Net realized gain (loss) on investment transactions
Net change in unrealized appreciation (depreciation) on investment transactions
(Provision) benefit for taxes on unrealized appreciation on investments
Distributions to stockholders:
Stock issued in connection with dividend reinvestment plan
Distributions from distributable earnings
Tax reclassification of stockholders' equity in accordance with generally accepted accounting principles
Total increase (decrease) for the year ended September 30, 2021
Balance at September 30, 2021
Net increase (decrease) in net assets resulting from operations
Net investment income after taxes
Net realized gain (loss) on investment transactions
Net change in unrealized appreciation (depreciation) on investment transactions
(Provision) benefit for taxes on realized gain on investments
(Provision) benefit for taxes on unrealized appreciation on investments
Distributions to stockholders:
Stock issued in connection with dividend reinvestment plan
Distributions from distributable earnings
Tax reclassification of stockholders' equity in accordance with generally accepted accounting principles
Total increase (decrease) for the year ended September 30, 2022
Balance at September 30, 2022
Repurchases of common stock, net of commission costs
Net increase (decrease) in net assets resulting from operations:
Net investment income after taxes
Net realized gain (loss) on investment transactions
Net change in unrealized appreciation (depreciation) on investment transactions
(Provision) benefit for taxes on realized gain on investments
(Provision) benefit for taxes on unrealized appreciation on investments
Distributions to stockholders:
Distributions from distributable earnings
Tax reclassification of stockholders' equity in accordance with generally accepted accounting principles
Total increase (decrease) for the year ended September 30, 2023
Balance at September 30, 2023
Common Stock
Shares
Par Amount
Paid in Capital in
Excess of Par
Distributable Earnings
(Losses)
Total Net Assets
167,259,511
$
167
$
2,624,608
$
(228,582)
$
2,396,193
—
—
—
—
2,769,073
—
—
2,769,073
170,028,584
—
—
—
—
—
867,086
—
—
867,086
170,895,670
(1,300,928)
—
—
—
—
—
—
—
(1,300,928)
169,594,742
$
—
—
—
—
3
—
—
3
—
—
—
—
41,068
—
(1,425)
39,643
170
2,664,251
—
—
—
—
—
1
—
—
1
171
(1)
—
—
—
—
—
—
—
(1)
—
—
—
—
—
13,173
—
(750)
12,423
2,676,674
(16,860)
—
—
—
—
—
—
(12,902)
(29,762)
167,672
7,905
165,246
(543)
—
(194,852)
1,425
146,853
(81,729)
196,119
20,376
(61,898)
(302)
(855)
—
(204,806)
750
(50,616)
(132,345)
—
289,088
(44,113)
13,555
(207)
308
(238,392)
12,902
33,141
170
$
2,646,912
$
(99,204)
$
167,672
7,905
165,246
(543)
41,071
(194,852)
—
186,499
2,582,692
196,119
20,376
(61,898)
(302)
(855)
13,174
(204,806)
—
(38,192)
2,544,500
(16,861)
289,088
(44,113)
13,555
(207)
308
(238,392)
—
3,378
2,547,878
See Notes to Consolidated Financial Statements.
125
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In thousands)
Cash flows from operating activities
Net increase (decrease) in net assets resulting from operations
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in)
operating activities:
$
Amortization of deferred debt issuance costs
Accretion of discounts and amortization of premiums on investments
Accretion of discounts and amortization of premiums on issued debt securities
Net realized (gain) loss on investments
Net realized (gain) loss on foreign currency transactions
Net realized (gain) loss on forward currency contracts
Net change in unrealized (appreciation) depreciation on investments
Net change in unrealized (appreciation) depreciation on translation of assets and liabilities in foreign currencies
Net change in unrealized (appreciation) depreciation on forward currency contracts
Proceeds from (fundings of) revolving loans, net
Fundings of investments
Proceeds from principal payments and sales of portfolio investments
Proceeds from settlements of forward currency contracts
Payment-in-kind interest capitalized
Non-cash dividends capitalized
Proceeds from non-cash dividends
Changes in operating assets and liabilities:
Interest receivable
Cash collateral held at broker for forward currency contracts
Receivable from investments sold
Other assets
Interest payable
Management and incentive fees payable
Payable for investments purchased
Accrued trustee fees
Accounts payable and other liabilities
Net cash provided by (used in) operating activities
Cash flows from financing activities
Borrowings on debt
Repayments of debt
Capitalized debt issuance costs
Purchases of common stock (Note 12)
Distributions paid
Purchases of common stock for dividend reinvestment plan
Net cash provided by (used in) financing activities
Net change in cash and cash equivalents, foreign currencies, restricted cash and cash equivalents
Effect of foreign currency exchange rates
Cash and cash equivalents, foreign currencies, restricted cash and cash equivalents, beginning of period
2023
2022
2021
Year ended September 30,
258,631
$
153,440
$
340,280
7,380
(12,878)
424
46,496
328
(2,711)
(14,267)
(16,680)
17,392
(381)
(675,341)
670,188
2,711
(38,844)
(14,901)
10
(37,260)
—
—
(2,470)
4,365
1,847
—
106
1,225
195,370
652,583
(627,094)
(5,782)
(16,861)
(191,465)
(46,927)
(235,546)
(40,176)
(171)
180,553
7,337
(9,047)
1,715
(18,925)
(371)
(1,080)
56,806
37,335
(32,243)
(1,812)
(1,883,080)
1,260,787
1,080
(21,506)
—
—
(2,533)
6,960
97
(910)
7,868
21,183
(294)
225
505
(416,463)
1,292,672
(741,211)
(6,698)
—
(155,208)
(36,424)
353,131
(63,332)
(458)
244,343
10,203
9,394
2,129
(13,006)
5,101
—
(161,867)
(2,225)
(1,154)
12,170
(2,082,127)
1,593,478
—
(16,092)
—
—
(998)
(3,640)
162
524
4,641
(5,100)
294
—
1,785
(306,048)
3,358,842
(2,816,054)
(22,157)
—
(139,122)
(14,659)
366,850
60,802
(889)
184,430
See Notes to Consolidated Financial Statements.
126
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Golub Capital BDC, Inc. and Subsidiaries
Consolidated Statements of Cash Flows - (continued)
(In thousands)
Cash and cash equivalents, foreign currencies, restricted cash and cash equivalents, end of period
Supplemental disclosure of cash flow information:
Cash paid during the period for interest
Distributions declared for the period
Supplemental disclosure of non-cash financing activities:
Stock issued in connection with dividend reinvestment plan
Proceeds from issuance of Class A-2-R GCIC 2018 Notes
Redemptions of Class A-2 GCIC 2018 Notes
2023
2022
2021
Year ended September 30,
$
$
$
140,206
138,441
238,392
—
—
—
180,553
$
72,458
204,806
$
13,174
—
—
244,343
48,766
194,852
41,071
38,500
(38,500)
$
$
$
wor
The following table provides a reconciliation of cash and cash equivalents, foreign currencies and restricted cash and cash equivalents reported within the Consolidated Statements of Financial Condition that sum to the
total of the same such amounts in the Consolidated Statements of Cash Flows:
Cash and cash equivalents
Foreign currencies (cost of $4,540 and $7,021, respectively)
Restricted cash and cash equivalents
Total cash and cash equivalents, foreign currencies and restricted cash and cash equivalents shown in the Consolidated Statements of Cash Flows $
$
65,617
4,208
70,381
140,206
$
$
117,290
6,847
56,416
180,553
See “Note 2. Significant Accounting Policies and Recent Accounting Updates” for a description of cash and cash equivalents, foreign currencies, restricted cash and cash equivalents and restricted foreign currencies.
September 30, 2023
September 30, 2022
As of
See Notes to Consolidated Financial Statements.
127
TABLE OF CONTENTS
Investments
Non-controlled/non-affiliate company investments
Debt investments
Aerospace and Defense
PPW Aero Buyer, Inc.+
PPW Aero Buyer, Inc.+(5)
Airlines
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
One stop
One stop
SF + 7.00%
SF + 7.00%
(k)(m)
12.33%
N/A(6)
02/2029
02/2029
$
$
24,825
—
24,825
24,157
(1)
24,156
Accelya Lux Finco S.A.R.L.+(8)(13)
One stop
SF + 6.00%
(l)
11.49%
12/2026
965
955
Auto Components
COP CollisionRight Holdings, Inc.#+
COP CollisionRight Holdings, Inc.+
Covercraft Parent III, Inc.+
Covercraft Parent III, Inc.+
Covercraft Parent III, Inc.+
North Haven Falcon Buyer, LLC+(23)
North Haven Falcon Buyer, LLC+(23)
Polk Acquisition Corp.*#+(23)
Polk Acquisition Corp.+(23)
Polk Acquisition Corp.+(23)
Automobiles
CG Group Holdings, LLC*#+(23)
CG Group Holdings, LLC+(23)
Denali Midco 2, LLC*#+
Denali Midco 2, LLC+(5)
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+(5)
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
JHCC Holdings LLC+
JHCC Holdings LLC+
JHCC Holdings LLC+
JHCC Holdings LLC+(5)
JHCC Holdings LLC+
cash/
cash/
cash/
cash/
cash/
3.75%
3.75%
1.75%
1.75%
1.75%
cash/
cash/
2.00%
2.00%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
One stop
SF + 5.25%
(l)
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 5.25%
SF + 4.50%
SF + 4.50%
SF + 4.50%
SF + 8.00%
SF + 8.00%
SF + 7.00%
SF + 7.00%
SF + 7.00%
SF + 8.75%
SF + 8.75%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.50%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
(l)
(l)(m)
(m)
(m)
(l)
(l)
(k)
(k)
(k)
(l)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(l)
(l)
(l)
(l)
10.79%
10.79%
10.10%
10.09%
10.03%
9.78%
9.82%
10.67%
10.67%
10.67%
12.14%
12.07%
11.67%
N/A(6)
11.67%
11.67%
11.67%
11.67%
11.67%
11.92%
11.67%
11.67%
11.67%
11.67%
N/A(6)
11.92%
11.92%
11.92%
11.92%
10.79%
10.79%
10.79%
N/A(6)
10.79%
04/2028
04/2028
08/2027
08/2027
08/2027
05/2027
05/2027
12/2024
12/2024
12/2024
07/2027
07/2026
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
09/2025
09/2025
09/2025
09/2025
09/2025
9,810
36
4,840
977
13
6,243
1,048
18,092
60
107
41,226
31,764
345
42,433
—
196
99
79
79
65
968
653
119
113
81
—
129
65
221
261
15,156
491
292
—
3,309
9,680
35
4,809
960
12
6,141
1,037
18,078
61
107
40,920
31,300
340
42,132
(4)
194
98
78
78
65
945
649
118
112
81
(7)
126
63
215
255
15,026
487
290
(1)
3,286
See Notes to Consolidated Financial Statements.
128
% $
1.0
—
1.0
—
0.4
—
0.2
—
—
0.2
0.1
0.7
—
—
1.6
1.2
—
1.6
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
0.6
—
—
—
0.1
24,825
—
24,825
917
9,711
35
4,647
938
9
5,493
922
17,731
57
105
39,648
30,493
333
41,583
(10)
192
97
77
77
64
959
640
116
111
80
(3)
128
64
218
258
14,929
483
287
(2)
3,259
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
JHCC Holdings LLC+
MOP GM Holding, LLC*#+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+(5)
MOP GM Holding, LLC+
MOP GM Holding, LLC+
POY Holdings, LLC#
POY Holdings, LLC+(5)
POY Holdings, LLC+(5)
POY Holdings, LLC+
National Express Wash Parent Holdco, LLC+
National Express Wash Parent Holdco, LLC+
National Express Wash Parent Holdco, LLC+(5)
Quick Quack Car Wash Holdings, LLC*#
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC#+
Quick Quack Car Wash Holdings, LLC*+
Quick Quack Car Wash Holdings, LLC*+
Quick Quack Car Wash Holdings, LLC*+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+(5)
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+(5)
Spotless Brands, LLC+
Spotless Brands, LLC+
Spotless Brands, LLC+
Spotless Brands, LLC+
TWAS Holdings, LLC#+
TWAS Holdings, LLC*+
TWAS Holdings, LLC+
TWAS Holdings, LLC+
TWAS Holdings, LLC+
TWAS Holdings, LLC+(5)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 6.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
(l)
(l)
(m)
(l)
(m)
(l)
(l)
(m)
(l)
(l)
(l)
(l)
(l)(m)
(l)
(l)
(l)
(l)
(l)(m)
(m)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(k)
(l)
(l)
(l)
(k)
(k)
(k)
(k)
(k)
12.29%
11.29%
11.03%
11.32%
11.03%
11.29%
11.27%
11.03%
11.29%
11.29%
11.29%
11.29%
11.34%
N/A(6)
11.27%
11.27%
11.04%
N/A(6)
N/A(6)
11.04%
10.89%
10.96%
N/A(6)
12.02%
12.02%
12.02%
12.02%
12.02%
12.02%
12.02%
N/A(6)
12.02%
12.02%
12.02%
12.02%
12.02%
11.92%
N/A(6)
12.00%
12.02%
N/A(6)
11.99%
12.17%
12.17%
12.17%
12.17%
12.17%
N/A(6)
Maturity
Date
09/2025
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2027
11/2027
11/2027
11/2027
07/2029
07/2029
07/2029
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
07/2028
07/2028
07/2028
07/2028
12/2026
12/2026
12/2026
12/2026
12/2026
12/2026
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
1,109
23,733
$
2,602
2,573
2,552
1,891
1,555
1,433
522
355
146
59
186
—
178
59
9,447
—
—
81
4,980
105
—
12,682
9,675
2,289
1,998
1,336
1,089
94
—
50
342
103
3,293
94
1,500
—
8,306
903
—
670
40,051
30,255
7,854
603
383
—
1,090
23,574
2,587
2,545
2,535
1,879
1,546
1,416
519
352
145
59
185
(16)
177
59
9,316
(3)
(1)
80
4,939
103
(3)
12,538
9,565
2,263
1,988
1,328
1,076
90
(2)
48
336
99
3,242
92
1,485
(35)
8,173
896
—
665
39,793
30,045
7,801
599
381
(2)
— %
0.9
$
0.1
0.1
0.1
0.1
0.1
0.1
—
—
—
—
—
—
—
—
0.4
—
—
—
0.2
—
—
0.5
0.4
0.1
0.1
0.1
—
—
—
—
—
—
0.1
—
0.1
—
0.3
0.1
—
—
1.6
1.2
0.3
—
—
—
1,114
22,785
2,498
2,470
2,450
1,815
1,493
1,376
501
341
140
57
178
(93)
171
57
9,447
—
—
81
4,781
97
(15)
12,555
9,578
2,266
1,979
1,323
1,078
93
(2)
49
338
102
3,260
93
1,485
(35)
8,223
894
—
663
39,651
29,953
7,775
597
379
(4)
274,054
271,473
10.5
268,470
See Notes to Consolidated Financial Statements.
129
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Beverages
Financial Information Technologies, LLC+
Financial Information Technologies, LLC+(23)
Financial Information Technologies, LLC+(5)
Watermill Express, LLC+
Watermill Express, LLC+
Watermill Express, LLC+
Winebow Holdings, Inc.+
Building Products
BECO Holding Company, Inc.#+
BECO Holding Company, Inc.+
BECO Holding Company, Inc.+(5)
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Chemicals
Inhance Technologies Holdings LLC#+
Inhance Technologies Holdings LLC#
Inhance Technologies Holdings LLC+
Inhance Technologies Holdings LLC+
PHM NL SP Bidco B.V.+(8)(9)(14)
PHM NL SP Bidco B.V.+(8)(14)
PHM NL SP Bidco B.V.+(8)(9)(14)
PHM NL SP Bidco B.V.+(8)(9)(14)
Commercial Services & Supplies
CI (Quercus) Intermediate Holdings, LLC*#+
CI (Quercus) Intermediate Holdings, LLC+
CI (Quercus) Intermediate Holdings, LLC+(5)
Kleinfelder Intermediate, LLC+
Kleinfelder Intermediate, LLC+
Kleinfelder Intermediate, LLC+(5)
North Haven Stack Buyer, LLC*#
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
SF + 6.50%
(l)
N/A
SF + 6.50%
SF + 5.00%
SF + 5.00%
SF + 5.00%
SF + 6.25%
(l)
(k)
(l)
(k)
Interest
Rate
(2)
PIK
11.89%
14.00%
N/A(6)
10.54%
10.42%
10.54%
11.67%
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SN +
E +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
5.25%
5.25%
5.25%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
6.00%
6.00%
6.00%
6.00%
6.25%
6.25%
6.25%
6.25%
5.25%
5.25%
5.25%
6.25%
6.25%
6.25%
5.50%
(l)
(k)
(k)(l)
(k)(l)
(k)(l)
(k)(l)
(k)(l)
(k)(l)
(k)(l)(m)
(k)(l)
(k)(l)
(l)
(l)
(l)
(k)(l)
(e)
(j)
(i)
(e)
(k)(l)
(k)
(l)
(l)
(l)
10.79%
10.67%
N/A(6)
11.22%
11.22%
11.22%
11.22%
11.22%
11.22%
11.23%
11.22%
11.22%
11.40%
11.40%
11.40%
11.42%
10.39%
11.55%
11.44%
10.01%
10.79%
10.67%
N/A(6)
11.66%
11.66%
N/A(6)
11.02%
Maturity
Date
06/2030
06/2031
06/2030
04/2027
04/2027
04/2027
07/2025
11/2028
11/2027
11/2028
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
07/2024
07/2024
07/2024
07/2024
09/2028
09/2028
09/2028
09/2028
10/2028
10/2028
10/2028
09/2030
09/2028
09/2030
07/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
22,623
$
11,182
—
2,221
8
214
7,720
43,968
7,462
20
—
4,063
1,374
886
835
425
271
1,450
211
113
22,295
10,869
—
2,208
7
214
7,671
43,264
7,407
17
(14)
4,045
1,373
883
830
425
270
1,441
211
112
17,110
17,000
12,314
9,813
1,871
199
33,496
13,766
7,335
3,540
82,334
17,792
10
—
3,754
59
—
8,678
12,341
9,783
1,869
200
36,220
13,593
7,919
3,720
85,645
17,614
8
(3)
3,679
50
(7)
8,568
0.9 % $
0.4
—
0.1
—
—
0.3
1.7
0.3
—
—
0.2
0.1
—
—
—
—
0.1
—
—
0.7
0.5
0.3
0.1
—
1.2
0.5
0.2
0.1
2.9
0.7
—
—
0.2
—
—
0.3
22,396
10,847
(1)
2,221
8
214
7,566
43,251
7,313
12
(39)
4,063
1,374
886
835
425
271
1,450
211
113
16,914
11,637
9,273
1,768
187
29,476
12,114
6,455
3,116
74,026
17,792
10
—
3,679
50
(8)
8,569
See Notes to Consolidated Financial Statements.
130
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
North Haven Stack Buyer, LLC+(5)
North Haven Stack Buyer, LLC+
North Haven Stack Buyer, LLC#
North Haven Stack Buyer, LLC#
North Haven Stack Buyer, LLC+
North Haven Stack Buyer, LLC+
North Haven Stack Buyer, LLC+
North Haven Stack Buyer, LLC+(5)
North Haven Stack Buyer, LLC+(5)
Profile Products LLC+
Profile Products LLC+(8)
Profile Products LLC+
Profile Products LLC+
PT Intermediate Holdings III, LLC+
PT Intermediate Holdings III, LLC+
PT Intermediate Holdings III, LLC+
PT Intermediate Holdings III, LLC+
PT Intermediate Holdings III, LLC+(5)
Radwell Parent, LLC+
Radwell Parent, LLC+
Radwell Parent, LLC+(5)
Radwell Parent, LLC#+
Trinity Air Consultants Holdings Corporation+
Trinity Air Consultants Holdings Corporation+(5)
Trinity Air Consultants Holdings Corporation+
Trinity Air Consultants Holdings Corporation+
WRE Holding Corp.*#
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
Communications Equipment
Lightning Finco Limited+(8)(10)
Lightning Finco Limited+(8)(9)(10)
Containers and Packaging
AmerCareRoyal LLC+(23)
AmerCareRoyal LLC+(23)
AmerCareRoyal LLC+(23)
AmerCareRoyal LLC+(8)(23)
Chase Intermediate#+
Chase Intermediate+
Chase Intermediate+(5)
Investment Type
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Second lien
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Spread
Above
Index
(1)
5.50%
5.50% (b)(l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50%
5.75% (l)
5.75% (l)
5.75% (b)(k)
4.75% (b)
5.98% (l)
5.98% (l)
5.98% (l)
6.50% (l)
6.50%
6.53% (l)
6.75% (l)
6.53%
6.75% (l)
5.75% (l)
5.75%
5.75%
5.75% (m)
5.00% (k)(m)
5.00% (k)
5.00% (m)
5.00% (m)
5.00% (m)
5.00% (m)
5.00% (k)
5.25%
5.00% (k)(l)(m)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
N/A
SF +
SF +
SF +
P +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
One stop
One stop
SF +
E +
5.75% (l)
5.75% (d)
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
SF +
7.00% (k)
7.00% (k)
7.00% (k)
7.00% (k)(l)
5.25% (k)(l)(m)
5.25% (m)
5.25%
N/A(6)
11.40%
11.02%
11.02%
11.02%
11.02%
11.02%
N/A(6)
N/A(6)
11.22%
11.22%
11.42%
13.25%
11.52%
11.52%
11.52%
11.89%
N/A(6)
12.02%
12.14%
N/A(6)
12.14%
11.10%
N/A(6)
N/A(6)
11.27%
10.50%
10.43%
10.19%
10.19%
10.19%
10.19%
10.57%
N/A(6)
10.38%
11.13%
9.53%
11.98%
11.98%
11.98%
11.98%
10.95%
11.00%
N/A(6)
Interest
Rate
(2)
cash/
cash/
cash/
cash/
0.50%
0.50%
0.50%
0.50%
PIK
PIK
PIK
PIK
Maturity
Date
07/2027
07/2027
07/2027
07/2027
07/2027
07/2027
07/2027
07/2027
01/2028
11/2027
11/2027
11/2027
11/2027
11/2028
11/2028
11/2028
11/2028
11/2028
03/2029
03/2028
03/2029
03/2029
06/2027
06/2027
06/2027
06/2027
01/2025
01/2025
01/2025
01/2025
01/2025
01/2025
01/2025
01/2025
01/2025
09/2028
09/2028
11/2025
11/2025
11/2025
11/2025
10/2028
10/2028
10/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
—
66
2,923
964
968
142
71
—
—
6,293
1,275
42
8
29,225
20,664
9,800
2,243
—
18,885
69
—
24,763
2,458
—
—
35
2,204
911
668
395
127
23
353
—
150
(18)
65
2,905
958
962
141
70
(61)
(35)
6,199
1,258
41
8
28,846
20,504
9,696
2,214
(8)
18,644
64
(7)
24,118
2,427
(3)
—
35
2,200
908
667
394
127
23
345
—
149
156,018
153,745
10,349
1,123
11,472
743
159
154
133
10,818
120
—
10,204
1,244
11,448
737
157
153
132
10,743
117
(1)
— % $
—
0.1
0.1
0.1
—
—
—
—
0.3
—
—
—
1.1
0.8
0.4
0.1
—
0.7
—
—
1.0
0.1
—
—
—
0.1
—
—
—
—
—
—
—
—
6.1
0.4
—
0.4
0.1
—
—
—
0.4
—
—
(20)
64
2,887
952
956
140
70
(46)
(35)
6,167
1,250
41
8
29,225
20,664
9,800
2,260
—
18,885
69
—
24,824
2,458
—
—
35
2,204
911
668
395
127
23
353
—
150
155,577
10,246
1,112
11,358
743
159
154
133
10,601
113
(4)
See Notes to Consolidated Financial Statements.
131
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Chase Intermediate+(5)
Fortis Solutions Group, LLC*#+
Fortis Solutions Group, LLC+(5)
Fortis Solutions Group, LLC+
Fortis Solutions Group, LLC+
Diversified Consumer Services
Certus Pest, Inc.#
Certus Pest, Inc.#
Certus Pest, Inc.+
Certus Pest, Inc.#
Certus Pest, Inc.+
Certus Pest, Inc.#
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+(5)
CHHJ Midco, LLC#
CHHJ Midco, LLC+
COP Exterminators Acquisitions, Inc.+
COP Exterminators Acquisitions, Inc.+(5)
COP Exterminators Acquisitions, Inc.+(5)
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
DP Flores Holdings, LLC#
DP Flores Holdings, LLC+(5)
DP Flores Holdings, LLC+(5)
EMS LINQ, LLC+
EMS LINQ, LLC+(5)
EWC Growth Partners LLC+
EWC Growth Partners LLC+
EWC Growth Partners LLC+
EWC Growth Partners LLC+
Excelligence Learning Corporation#+
FPG Intermediate Holdco, LLC+
FPG Intermediate Holdco, LLC+
FPG Intermediate Holdco, LLC+
FPG Intermediate Holdco, LLC+(5)
FSS Buyer LLC+
FSS Buyer LLC+(5)
HS Spa Holdings, Inc.+
HS Spa Holdings, Inc.+
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
5.75%
5.50% (l)
5.50%
5.50% (l)
5.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50% (l)
7.50%
5.00% (k)
5.00%
5.50% (l)
5.50%
5.50%
4.50% (l)
4.50% (l)
4.50% (l)
4.50% (l)
4.50% (l)
4.75% (l)
4.50%
6.25% (m)
6.25%
6.25%
6.25% (k)
6.25%
6.00% (l)
6.00%
6.00% (l)
6.00% (l)
6.00% (l)
6.00% (l)
6.00% (l)
6.00% (b)(l)
6.50%
5.75% (l)
5.75%
5.75% (m)
5.75% (k)(l)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
Interest
Rate
(2)
N/A(6)
10.99%
N/A(6)
10.99%
10.99%
13.04%
13.04%
13.04%
13.04%
13.04%
13.04%
13.04%
13.04%
13.04%
13.04%
13.04%
N/A(6)
10.42%
N/A(6)
11.02%
N/A(6)
N/A(6)
9.90%
9.90%
9.92%
9.98%
9.90%
10.31%
N/A(6)
11.59%
N/A(6)
N/A(6)
11.67%
N/A(6)
11.54%
N/A(6)
11.54%
11.54%
11.54%
11.57%
11.57%
12.16%
N/A(6)
11.24%
N/A(6)
11.07%
11.07%
Maturity
Date
10/2028
10/2028
10/2027
10/2028
10/2028
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
01/2026
01/2026
07/2029
07/2029
07/2029
07/2027
07/2027
07/2027
07/2027
07/2027
07/2027
07/2027
09/2028
09/2028
09/2028
12/2027
12/2027
03/2026
03/2026
03/2026
03/2026
01/2024
03/2027
03/2027
03/2027
03/2027
08/2028
08/2027
06/2029
06/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
$
—
$
34,402
—
98
358
46,985
1,573
1,508
1,088
1,074
745
657
640
378
237
129
54
—
2,695
—
2,864
—
—
1,695
1,652
1,083
765
197
119
—
2,574
—
—
9,591
—
920
—
14
73
10,176
7,668
484
33
—
5,436
—
7,704
13
(5)
33,976
(4)
17
325
46,347
1,547
1,471
1,084
1,064
732
632
635
371
226
111
50
(1)
2,682
—
2,830
(1)
(26)
1,685
1,636
1,073
758
195
117
—
2,536
(1)
(12)
9,524
(1)
914
—
14
73
10,157
7,563
474
32
(12)
5,360
(1)
7,579
11
— % $
1.3
—
—
—
1.8
0.1
0.1
0.1
0.1
—
—
—
—
—
—
—
—
0.1
—
0.1
—
—
0.1
0.1
0.1
—
—
—
—
0.1
—
—
0.4
—
0.1
—
—
—
0.4
0.3
—
—
—
0.2
—
0.3
—
Fair
Value
(4)
(5)
33,370
(8)
95
190
45,541
1,557
1,493
1,077
1,064
738
650
634
374
235
128
54
(1)
2,695
—
2,829
(1)
(20)
1,695
1,652
1,083
765
197
119
—
2,574
—
—
9,304
(4)
920
—
14
73
10,176
7,592
479
32
—
5,436
—
7,627
12
See Notes to Consolidated Financial Statements.
132
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Learn-it Systems, LLC+(23)
Learn-it Systems, LLC+(23)
Learn-it Systems, LLC+(23)
Learn-it Systems, LLC+(5)(23)
Liminex, Inc.+
Liminex, Inc.+
Liminex, Inc.+
Liminex, Inc.+(5)
Liminex, Inc.+
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Mario Purchaser, LLC+
Mario Purchaser, LLC+(23)
Mario Purchaser, LLC+(5)
Mario Purchaser, LLC+
Mathnasium, LLC#
Mathnasium, LLC+
NSG Buyer, Inc. *#+
NSG Buyer, Inc. +(5)
NSG Buyer, Inc. +
PADI Holdco, Inc.*#(23)
PADI Holdco, Inc.+(8)(9)(23)
PADI Holdco, Inc.+(23)
PADI Holdco, Inc.+(23)
PADI Holdco, Inc.+
Provenance Buyer LLC*#+
Provenance Buyer LLC#
Provenance Buyer LLC+(5)
RW AM Holdco LLC#+
RW AM Holdco LLC+(5)
Interest
Rate
(2)
cash/
cash/
cash/
2.75%
2.75%
2.75%
PIK
PIK
PIK
PIK
Investment Type
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
5.25%
5.25%
5.25%
4.75%
7.25%
7.25%
7.25%
7.25%
7.25%
6.00%
5.25%
5.25%
5.25%
6.00%
5.25%
(l)
(l)
(l)
(a)
(l)
(l)
(l)
(l)
(k)
(k)
(k)
(k)
(k)
5.75%
(k)
10.75% (k)
5.75%
5.75%
5.00%
5.00%
6.50%
6.50%
6.50%
6.25%
6.25%
6.25%
6.25%
6.25%
5.00%
5.00%
5.00%
5.25%
5.25%
(k)
(l)
(l)
(k)
(l)
(d)
(l)
(l)
(l)
(k)
(k)
(m)
SF +
SF +
SF +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
8.04%
8.04%
8.04%
10.40%
12.79%
12.79%
12.79%
N/A(6)
12.79%
11.42%
10.67%
10.67%
10.67%
11.42%
N/A(6)
11.17%
16.17%
N/A(6)
11.17%
10.51%
10.52%
11.92%
N/A(6)
N/A(6)
11.82%
10.03%
11.79%
11.79%
11.77%
10.42%
10.42%
N/A(6)
10.82%
N/A(6)
Maturity
Date
09/2026
09/2026
09/2026
09/2026
11/2026
11/2026
11/2026
11/2026
11/2026
05/2026
05/2026
05/2026
05/2026
05/2026
05/2025
04/2029
04/2032
04/2028
04/2029
11/2027
11/2027
11/2029
11/2029
11/2028
01/2027
01/2027
01/2027
01/2027
01/2027
06/2027
06/2027
06/2027
04/2028
04/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
2,536
1,364
615
—
25,462
20,000
800
—
15,837
5,660
3,636
682
682
512
—
7,577
1,784
—
169
9,168
11
20,821
—
—
21,582
19,322
832
172
54
18,094
9,875
—
17,551
—
2,550
1,363
612
—
25,126
19,795
793
(2)
15,558
5,622
3,647
694
694
509
—
7,457
1,749
(1)
165
9,105
11
20,423
(35)
—
21,242
20,594
819
169
50
17,864
9,801
(2)
17,418
(1)
0.1 % $
—
—
—
1.0
0.8
—
—
0.6
0.2
0.1
—
—
—
—
0.3
0.1
—
—
0.4
—
0.8
—
—
0.8
0.8
—
—
—
0.7
0.4
—
0.7
—
268,637
266,870
10.5
2,333
1,256
565
(3)
25,462
20,000
800
—
15,837
5,660
3,636
682
682
512
—
7,274
1,748
(3)
154
9,168
11
20,821
—
—
21,582
19,322
832
172
54
18,094
9,875
—
17,025
(5)
266,798
See Notes to Consolidated Financial Statements.
133
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Diversified Financial Services
Adenza Group, Inc. +
Adenza Group, Inc. +
Avalara, Inc.+
Avalara, Inc.+(5)
Banker's Toolbox, Inc.+
Banker's Toolbox, Inc.+
Banker's Toolbox, Inc.+
Finastra USA, Inc.+(8)
Finastra USA, Inc.+(8)
Flash Topco, Inc.*
Flash Topco, Inc.+
Flash Topco, Inc.+
Higginbotham Insurance Agency, Inc.+
Higginbotham Insurance Agency, Inc.+(5)
Higginbotham Insurance Agency, Inc.+
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
5.75% (k)
5.75%
7.25% (l)
7.25%
5.25% (l)
5.25%
5.25% (l)
7.25% (m)
7.25% (k)
5.75% (l)
6.50% (l)
6.50% (l)
5.50% (k)
5.50%
5.50% (k)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
Interest
Rate
(2)
11.18%
N/A(6)
12.64%
N/A(6)
10.72%
N/A(6)
10.72%
12.71%
12.58%
11.22%
11.87%
11.87%
10.92%
N/A(6)
10.92%
Maturity
Date
12/2027
12/2025
10/2028
10/2028
07/2027
07/2027
07/2027
09/2029
09/2029
10/2028
10/2028
12/2024
11/2028
11/2028
11/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
3,975
$
—
11,941
—
7,936
—
1,478
4,950
11
9,721
41
19
4,530
—
183
3,923
—
11,690
(3)
7,873
—
1,478
4,852
10
9,649
40
19
4,494
(25)
183
44,785
44,183
% $
0.1
—
0.5
—
0.3
—
—
0.2
—
0.4
—
—
0.2
—
—
1.7
3,975
—
11,941
—
7,936
—
1,478
4,851
10
9,235
38
19
4,507
(25)
182
44,147
See Notes to Consolidated Financial Statements.
134
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Diversified Telecommunication Services
NTI Connect, LLC+
Electronic Equipment, Instruments & Components
CST Holding Company+
CST Holding Company+(5)
Food & Staples Retailing
Cafe Rio Holding, Inc.*#
Cafe Rio Holding, Inc.#+
Cafe Rio Holding, Inc.#+
Cafe Rio Holding, Inc.*#
Cafe Rio Holding, Inc.#+
Cafe Rio Holding, Inc.+
Cafe Rio Holding, Inc.+
Cafe Rio Holding, Inc.+
Cafe Rio Holding, Inc.+
Cafe Rio Holding, Inc.+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Ruby Slipper Cafe LLC, The*+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Wineshipping.com LLC+
Wineshipping.com LLC+
Wineshipping.com LLC+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Senior secured
SF + 4.75%
(l)
10.29%
12/2024
$
1,612
$
1,601
0.1
% $
1,612
One stop
One stop
SF + 6.50%
SF + 6.50%
(k)
11.92%
N/A(6)
11/2028
11/2028
24,533
—
24,533
23,910
(1)
23,909
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 7.50%
SF + 7.50%
SF + 7.50%
SF + 7.50%
SF + 7.50%
SF + 5.75%
SF + 5.75%
SF + 5.75%
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(b)(l)
10.67%
10.67%
10.67%
10.67%
10.67%
10.67%
10.67%
10.67%
10.67%
10.67%
11.67%
11.67%
11.67%
11.67%
11.67%
11.67%
11.67%
11.67%
11.67%
11.67%
13.04%
13.04%
13.04%
13.04%
13.04%
11.32%
11.20%
11.47%
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2024
06/2024
06/2024
06/2024
06/2024
10/2027
10/2027
10/2027
18,034
3,244
2,179
1,383
1,222
101
176
50
79
100
923
726
712
351
350
173
105
824
307
514
2,003
406
289
—
28
6,725
184
63
18,034
3,224
2,179
1,383
1,222
101
176
50
79
99
918
722
708
349
347
172
104
817
306
511
2,003
406
288
—
28
6,679
177
63
41,251
41,145
1.0
—
1.0
0.7
0.1
0.1
0.1
0.1
—
—
—
—
—
0.1
—
—
—
—
—
—
—
—
—
0.1
—
—
—
—
0.3
—
—
1.6
24,533
—
24,533
18,034
3,244
2,179
1,383
1,222
101
176
50
79
100
923
726
712
351
350
173
105
824
307
514
2,003
406
289
—
28
6,456
177
60
40,972
See Notes to Consolidated Financial Statements.
135
TABLE OF CONTENTS
Food Products
Borrower R365 Holdings, LLC+(23)
Borrower R365 Holdings, LLC+(23)
Borrower R365 Holdings, LLC+(5)
Borrower R365 Holdings, LLC+(5)
Borrower R365 Holdings, LLC+(23)
Flavor Producers, LLC#+(23)
Flavor Producers, LLC+(5)
Kodiak Cakes, LLC*#+
Kodiak Cakes, LLC+
Louisiana Fish Fry Products, Ltd.*+
Louisiana Fish Fry Products, Ltd.+
MAPF Holdings, Inc.*#+
MAPF Holdings, Inc.+
P&P Food Safety Holdings, Inc.*+
P&P Food Safety Holdings, Inc.+
P&P Food Safety Holdings, Inc.+(5)
Purfoods, LLC+(23)
Ultimate Baked Goods Midco LLC+
Ultimate Baked Goods Midco LLC+(5)
Whitebridge Pet Brands, LLC*#+
Whitebridge Pet Brands, LLC+(5)
Wizard Bidco Limited+(8)(9)(10)
Wizard Bidco Limited+(8)(9)(10)
Wizard Bidco Limited+(8)(10)
Wizard Bidco Limited+(8)(9)(10)
Wizard Bidco Limited+(5)(8)(9)(10)
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
N/A
SF +
SF +
6.50%
6.50%
6.50%
6.50%
6.50%
6.50%
6.50%
8.75%
8.75%
6.25%
6.25%
5.00%
5.00%
6.00%
6.00%
6.00%
6.25%
6.25%
4.75%
SF +
SF +
4.75%
SN + 5.25%
SN + 5.25%
SF +
6.50%
SN + 6.50%
SN + 6.50%
(l)
(l)
(l)
(b)(l)
(l)
(l)
(l)
(b)(k)(l)
(l)
(l)
(l)
(l)
(k)
(k)
(i)
(i)
(l)
(i)
12.04%
12.04%
N/A(6)
N/A(6)
12.04%
10.24%
N/A(6)
14.14%
14.14%
11.79%
12.06%
10.54%
10.54%
11.54%
11.55%
N/A(6)
7.00%
11.67%
N/A(6)
10.17%
N/A(6)
10.44%
10.44%
11.89%
11.69%
N/A(6)
cash/
1.75%
PIK
PIK
Investment Type
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
See Notes to Consolidated Financial Statements.
136
Maturity
Date
06/2027
06/2027
06/2027
06/2027
06/2027
12/2024
09/2024
06/2027
06/2026
07/2027
07/2027
12/2026
12/2026
12/2026
12/2026
12/2026
05/2026
08/2027
08/2027
07/2027
07/2027
03/2029
09/2028
03/2029
03/2029
03/2029
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
13,669
1,127
$
13,510
1,112
—
—
43
5,035
—
12,338
150
9,678
76
37,594
120
17,579
19
—
66
6,604
—
20,777
—
6,631
91
16,243
5,424
—
(1)
(1)
43
5,028
—
12,048
146
9,616
75
37,388
118
17,449
18
(4)
68
6,551
(22)
20,530
(2)
7,077
90
15,955
5,389
(52)
153,264
152,129
% $
0.5
—
—
—
—
0.2
—
0.5
—
0.4
—
1.5
—
0.7
—
—
—
0.3
—
0.8
—
0.2
—
0.6
0.2
—
5.9
13,669
1,127
—
—
43
4,682
(2)
11,998
146
9,387
72
37,594
120
17,052
16
(16)
66
6,604
—
20,777
—
6,366
88
16,283
5,438
—
151,510
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Health Care Equipment & Supplies
Aspen Medical Products, LLC#+
Aspen Medical Products, LLC+
Aspen Medical Products, LLC+
Baduhenna Bidco Limited+(8)(10)
Baduhenna Bidco Limited+(8)(9)(10)
Baduhenna Bidco Limited+(8)(9)(10)
Baduhenna Bidco Limited+(8)(9)(10)
Baduhenna Bidco Limited+(5)(8)(9)(10)
Belmont Instrument, LLC*#
Belmont Instrument, LLC+
Blades Buyer, Inc.#+
Blades Buyer, Inc.+(5)
Blades Buyer, Inc.+
Blades Buyer, Inc.+
Blue River Pet Care, LLC*#+
Blue River Pet Care, LLC+
Blue River Pet Care, LLC+(5)
Blue River Pet Care, LLC+
Blue River Pet Care, LLC+
Blue River Pet Care, LLC+
Blue River Pet Care, LLC+
CCSL Holdings, LLC*#(8)
CCSL Holdings, LLC+(8)
CCSL Holdings, LLC+(8)(9)
CCSL Holdings, LLC+(5)(8)
CCSL Holdings, LLC+(5)(8)
CCSL Holdings, LLC+(5)(8)
CMI Parent Inc.*#
CMI Parent Inc.*
CMI Parent Inc.+(5)
CMI Parent Inc.*
G & H Wire Company, Inc.+(23)
G & H Wire Company, Inc.+(23)
Joerns Healthcare, LLC+(7)(23)
Joerns Healthcare, LLC+(23)
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
5.25% (l)
5.25% (l)
5.25%
5.95% (j)
5.95% (d)
5.95% (i)
5.95% (d)
5.95%
6.25% (l)
6.25% (l)
5.00% (l)(m)
4.75%
5.00% (k)
5.25% (k)
5.75% (l)
5.75% (k)(l)
5.75%
5.75% (l)
5.75% (l)
5.75% (l)
5.75% (l)
6.00% (k)
6.00% (k)
6.00% (i)
6.00%
6.00%
6.00%
4.75% (k)
4.75% (k)
4.75%
4.75% (k)
9.00% (l)
9.00% (l)
18.00% (l)
18.00% (l)
SF +
SF +
SF +
SF +
E +
SN +
E +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
10.76%
10.76%
N/A(6)
11.51%
9.72%
11.26%
9.92%
N/A(6)
11.64%
11.64%
10.45%
N/A(6)
10.33%
10.68%
11.27%
11.24%
N/A(6)
11.27%
11.27%
11.27%
11.27%
11.42%
11.42%
11.29%
N/A(6)
N/A(6)
N/A(6)
10.17%
10.17%
N/A(6)
10.17%
8.07%
8.07%
23.64%
23.64%
Interest
Rate
(2)
6.50%
6.50%
PIK
PIK
cash/
cash/
PIK
PIK
Maturity
Date
06/2025
06/2025
06/2025
08/2028
08/2028
08/2028
08/2028
08/2028
08/2028
08/2028
03/2028
03/2028
03/2028
03/2028
07/2026
08/2025
07/2026
07/2026
07/2026
07/2026
07/2026
12/2026
12/2026
12/2026
12/2026
12/2026
12/2028
08/2025
08/2025
08/2025
08/2025
12/2024
12/2024
01/2024
01/2024
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
4,115
$
263
—
5,415
3,063
863
731
—
9,801
33
9,958
—
317
1,301
50,675
124
—
178
171
764
170
15,241
4,114
2,354
—
—
—
6,432
3,094
—
2,903
11,846
100
1,560
310
4,141
262
—
5,363
3,396
947
760
(14)
9,722
32
9,880
(1)
316
1,283
50,449
122
(1)
177
170
759
169
14,986
4,048
2,385
(3)
(44)
(27)
6,474
3,080
(2)
2,884
11,798
98
1,470
310
135,896
135,389
% $
0.2
—
—
0.2
0.1
—
—
—
0.4
—
0.4
—
—
0.1
2.0
—
—
—
—
—
—
0.6
0.2
0.1
—
—
—
0.3
0.1
—
0.1
0.4
—
—
—
5.2
4,115
263
—
5,415
3,063
863
731
—
9,801
33
9,859
(3)
314
1,301
50,167
120
(2)
176
170
757
168
15,089
4,073
2,330
(3)
(26)
(27)
6,432
3,094
—
2,903
9,477
70
515
310
131,548
See Notes to Consolidated Financial Statements.
137
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Interest
Rate
(2)
PIK
cash/
6.75%
PIK
cash/
6.75%
PIK
Health Care Providers & Services
AAH TOPCO, LLC +
AAH TOPCO, LLC +(23)
AAH TOPCO, LLC +(5)
AAH TOPCO, LLC +
Active Day, Inc.#+
Active Day, Inc.#+
Active Day, Inc.*#
Active Day, Inc.+
Active Day, Inc.+
Active Day, Inc.*#
Active Day, Inc.+(5)
Active Day, Inc.+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+(23)
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC#+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+(23)
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+(23)
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+(5)
Acuity Eyecare Holdings, LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
Investment Type
One stop
Subordinated debt
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+(23)
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+(23)
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+(23)
Subordinated debt
Subordinated debt
Subordinated debt
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+(5)
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
Bamboo US Bidco LLC+
Bamboo US Bidco LLC+(8)(9)
Bamboo US Bidco LLC+(5)
Bamboo US Bidco LLC+(5)
Community Care Partners, LLC+
Community Care Partners, LLC+(5)
CRH Healthcare Purchaser, Inc.+
CRH Healthcare Purchaser, Inc.+
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Spread
Above
Index
(1)
5.50%
(k)
5.50%
5.50%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
6.00%
6.25%
6.25%
6.25%
6.25%
6.00%
6.25%
6.25%
13.00%
6.25%
6.00%
6.25%
13.00%
6.25%
6.25%
6.00%
6.13%
6.13%
10.50%
10.50%
10.50%
6.25%
6.00%
6.25%
6.00%
6.00%
6.00%
6.00%
6.00%
6.00%
4.75%
4.75%
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(k)
(k)
(k)
(k)
(k)(l)
(k)
(c)
(k)
(l)
(l)
SF +
N/A
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
N/A
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SF +
SF +
SF +
SF +
SF +
10.92%
11.50%
N/A(6)
10.92%
11.29%
11.29%
11.29%
11.29%
11.29%
11.29%
N/A(6)
11.29%
11.55%
16.50%
11.79%
11.80%
11.79%
11.79%
11.53%
11.79%
11.79%
11.79%
11.79%
11.52%
11.79%
11.79%
11.79%
N/A(6)
11.55%
11.65%
11.65%
15.92%
15.92%
15.92%
11.67%
N/A(6)
11.68%
11.32%
9.86%
N/A(6)
N/A(6)
11.43%
N/A(6)
10.29%
10.29%
Maturity
Date
12/2027
12/2031
12/2027
12/2027
02/2025
02/2025
02/2025
02/2025
02/2025
02/2025
02/2025
02/2025
03/2026
06/2027
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2026
03/2027
03/2027
03/2028
03/2028
03/2028
03/2027
03/2027
03/2027
09/2030
09/2030
09/2029
09/2030
06/2026
06/2026
12/2024
12/2024
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
8,245
1,211
—
472
17,566
1,356
874
696
615
604
—
—
16,343
12,165
4,036
3,596
3,504
3,171
2,027
1,849
447
264
165
30
109
102
1
—
1,033
4,661
3,896
2,213
846
264
153
—
72
2,424
1,595
—
—
2,325
—
8,187
1,195
—
468
17,462
1,348
869
692
610
600
(2)
—
16,198
12,007
4,012
3,570
3,484
3,185
1,999
1,866
445
263
164
27
108
102
1
(2)
1,024
4,625
3,855
2,192
840
262
151
(1)
72
2,352
1,547
(15)
(6)
2,311
(2)
19,501
5,145
19,500
5,126
0.3 % $
0.1
—
—
0.7
0.1
—
—
—
—
—
—
0.6
0.5
0.2
0.2
0.2
0.1
0.1
0.1
—
—
—
—
—
—
—
—
0.1
0.2
0.2
0.1
—
—
—
—
—
0.1
0.1
—
—
0.1
—
0.8
0.2
7,997
1,114
(2)
454
17,216
1,328
856
682
602
592
(4)
—
16,343
12,165
4,036
3,596
3,504
3,171
2,027
1,849
447
268
165
30
109
102
1
—
1,033
4,661
3,896
2,213
846
264
153
—
72
2,352
1,547
(15)
(6)
2,186
—
19,209
5,068
See Notes to Consolidated Financial Statements.
138
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
TABLE OF CONTENTS
CRH Healthcare Purchaser, Inc.+
CRH Healthcare Purchaser, Inc.+
CRH Healthcare Purchaser, Inc.+
Datix Bidco Limited+(8)(9)(10)
Datix Bidco Limited+(8)(9)(10)
Emerge Intermediate, Inc.*#(23)
Emerge Intermediate, Inc.+(23)
Emerge Intermediate, Inc.+(23)
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
ERC Topco Holdings, LLC+
ERC Topco Holdings, LLC+
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
Heartland Veterinary Partners LLC+
Heartland Veterinary Partners LLC+
Heartland Veterinary Partners LLC+
Klick Inc.+(8)(12)
Klick Inc.+(5)(8)(12)
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+
Investment Type
Senior secured
Senior secured
Senior secured
Senior secured
Second lien
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
SF + 4.75%
SF + 4.75%
SF + 4.75%
SN + 4.50%
SN + 7.75%
SF + 7.25%
SF + 7.25%
SF + 7.25%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 5.50%
SF + 5.50%
C +
C +
5.75%
5.75%
5.75%
C +
5.75%
C +
SF + 5.75%
SF + 5.75%
C +
5.75%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 4.50%
SF + 4.50%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
(l)
(l)
(l)
(i)
(i)
(k)
(k)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(h)
(h)
(h)
(h)
(l)
(l)
(h)
(k)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.#(8)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.#(8)
(12)
One stop
C +
5.50%
(h)
One stop
SF + 5.50%
One stop
SF + 5.50%
(l)
(l)
cash/
cash/
cash/
1.25%
1.25%
1.25%
PIK
PIK
PIK
10.29%
10.29%
10.29%
9.69%
12.94%
11.42%
11.42%
11.43%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.28%
11.15%
11.10%
11.25%
11.25%
11.25%
11.25%
11.27%
11.27%
11.25%
10.17%
10.17%
N/A(6)
9.99%
N/A(6)
10.79%
10.79%
10.79%
10.79%
10.79%
11.01%
11.04%
11.04%
Maturity
Date
12/2024
12/2024
12/2024
04/2025
04/2026
05/2024
05/2024
05/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2028
11/2027
03/2027
03/2027
03/2027
03/2027
03/2027
03/2027
03/2027
12/2026
12/2026
12/2026
03/2028
03/2026
05/2025
05/2025
05/2025
05/2025
05/2025
05/2028
05/2028
05/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
4,070
$
3,485
200
54,300
19,268
19,231
1,741
134
975
613
304
291
263
242
161
113
109
68
56
55
32
10
47
9,116
60
10,516
82
471
166
70
94
690
836
161
—
9,896
—
2,287
1,840
1,080
60
1,086
4,063
3,471
199
60,233
21,320
19,186
1,736
132
972
611
303
290
262
241
161
113
109
67
56
55
32
10
47
9,063
59
10,592
80
499
170
69
93
715
830
160
—
9,832
(1)
2,283
1,832
1,093
60
1,077
17,876
19,826
4,282
2,787
4,242
2,768
0.2 % $
0.1
—
2.1
0.8
0.8
0.1
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
0.3
—
0.4
—
—
—
—
—
—
—
—
—
0.4
—
0.1
0.1
—
—
—
0.7
0.2
0.1
4,008
3,433
196
53,757
19,171
19,231
1,741
134
945
594
295
282
256
235
156
110
105
66
54
54
31
9
45
7,566
37
10,516
82
471
166
70
94
690
819
158
—
9,896
—
2,287
1,840
1,080
60
1,086
16,983
4,068
2,648
See Notes to Consolidated Financial Statements.
139
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(12)
Oliver Street Dermatology Holdings, LLC+(7)(23)
Oliver Street Dermatology Holdings, LLC+(23)
Oliver Street Dermatology Holdings, LLC+(23)
Pinnacle Treatment Centers, Inc.*#
Pinnacle Treatment Centers, Inc.*
Pinnacle Treatment Centers, Inc.#+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.#
Pinnacle Treatment Centers, Inc.#
Suveto Buyer, LLC+
Suveto Buyer, LLC+
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
C +
5.50%
C +
5.50%
5.50%
C +
SF + 5.50%
SF + 5.50%
SF + 11.33%
SF + 6.25%
SF + 6.25%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 4.25%
SF + 4.25%
(h)
(h)
(h)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(k)
(k)
11.01%
11.01%
11.01%
11.04%
11.04%
16.87%
11.79%
11.79%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
12.32%
9.67%
9.67%
05/2028
$
1,090
$
1,181
— % $
1,035
05/2028
05/2026
05/2026
05/2028
11/2023
11/2023
11/2023
01/2026
01/2026
01/2026
01/2026
01/2026
01/2026
01/2026
01/2026
01/2026
01/2026
09/2027
09/2027
568
182
80
18
26,731
15,083
388
18,532
7,476
1,523
688
182
197
104
37
2,181
1,147
19,672
24
388,703
595
184
79
17
16,786
15,083
388
18,201
7,349
1,497
676
178
193
102
36
2,144
1,127
19,543
23
387,084
—
—
—
—
0.7
0.6
—
0.7
0.3
0.1
—
—
—
—
—
0.1
—
0.7
—
14.7
539
177
77
17
18,178
15,083
388
18,532
7,476
1,523
688
182
197
104
37
2,181
1,147
19,082
19
374,314
See Notes to Consolidated Financial Statements.
140
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Health Care Technology
Alegeus Technologies Holdings Corp.+
Senior secured
SF + 8.25%
(m)
Coding Solutions Acquisition, Inc.+
Coding Solutions Acquisition, Inc.+
Coding Solutions Acquisition, Inc.+
Coding Solutions Acquisition, Inc.+
Coding Solutions Acquisition, Inc.+(5)
Color Intermediate, LLC+
Connexin Software, Inc.+
Connexin Software, Inc.+
Crow River Buyer, Inc.+
Crow River Buyer, Inc.+(5)
ESO Solution, Inc.+
ESO Solution, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
Neptune Holdings, Inc.+
Neptune Holdings, Inc.+(5)
Plasma Buyer LLC+
Plasma Buyer LLC+
Plasma Buyer LLC+(5)
QF Holdings, Inc.+
Qgenda Intermediate Holdings, LLC+
Qgenda Intermediate Holdings, LLC#
Qgenda Intermediate Holdings, LLC+
Qgenda Intermediate Holdings, LLC#
Qgenda Intermediate Holdings, LLC+
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Tebra Technologies, Inc.+(23)
Transaction Data Systems, Inc.*#+
Transaction Data Systems, Inc.+
Veranex, Inc.+
Veranex, Inc.+
Veranex, Inc.+
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 6.00%
SF + 6.00%
SF + 5.50%
SF + 8.50%
SF + 8.50%
SF + 7.75%
SF + 7.75%
SF + 7.00%
SF + 7.00%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 6.25%
SF + 6.00%
SF + 6.00%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 6.25%
SF + 5.00%
SF + 5.00%
SF + 5.00%
SF + 5.00%
SF + 5.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 4.50%
SF + 4.50%
SF + 5.25%
SF + 5.25%
SF + 5.25%
(k)
(k)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(m)
(m)
(m)
(m)
(m)
(b)(m)
(m)
(m)
(m)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(l)
(k)
(m)
(m)
(m)
13.36%
10.82%
10.82%
11.57%
11.32%
N/A(6)
10.99%
13.89%
13.89%
13.12%
N/A(6)
12.40%
12.33%
11.19%
11.19%
11.32%
11.19%
11.19%
11.59%
11.19%
11.82%
11.50%
N/A(6)
11.14%
11.14%
N/A(6)
11.72%
10.49%
10.49%
10.49%
10.49%
10.49%
9.92%
9.92%
9.92%
9.92%
9.92%
9.92%
9.92%
9.92%
9.92%
9.92%
10.04%
9.93%
10.64%
10.63%
10.54%
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
09/2024
05/2028
05/2028
05/2028
05/2028
05/2028
10/2029
02/2024
02/2024
01/2029
01/2029
05/2027
03/2027
08/2026
08/2026
08/2026
08/2026
08/2026
09/2025
08/2026
08/2026
09/2030
08/2029
05/2029
05/2028
05/2029
12/2027
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
02/2026
02/2026
04/2028
04/2028
04/2028
$
374
$
5,196
14
1,571
632
—
11,665
9,465
20
4,631
—
7,549
43
6,122
2,919
1,923
1,341
628
76
131
485
4,950
—
5,349
11
—
626
14,813
12,070
1,440
962
200
10,760
10,474
6,901
1,774
1,577
1,183
986
789
157
84
65,427
180
3,146
50
25
373
5,155
14
1,558
616
(28)
11,465
9,470
20
4,548
(1)
7,495
42
6,104
2,897
1,913
1,327
626
76
130
480
4,877
(1)
5,263
10
(11)
619
14,813
12,023
1,436
963
200
10,687
10,159
6,854
1,762
1,567
1,175
979
783
156
84
64,881
178
3,122
50
25
198,719
196,934
— % $
0.2
—
0.1
—
—
0.4
0.4
—
0.2
—
0.3
—
0.2
0.1
0.1
0.1
—
—
—
—
0.2
—
0.2
—
—
—
0.6
0.5
0.1
—
—
0.4
0.4
0.3
0.1
0.1
—
—
—
—
—
2.6
—
0.1
—
—
7.7
374
5,014
12
1,516
616
(28)
11,315
9,465
20
4,631
—
7,474
42
6,046
2,883
1,899
1,325
620
76
129
485
4,888
(1)
4,921
7
—
626
14,517
11,829
1,411
943
196
10,814
10,526
6,935
1,783
1,585
1,189
990
793
158
84
65,427
180
2,674
43
21
196,453
See Notes to Consolidated Financial Statements.
141
TABLE OF CONTENTS
Hotels, Restaurants & Leisure
Barteca Restaurants, LLC#
Barteca Restaurants, LLC+(5)
Barteca Restaurants, LLC+
BJH Holdings III Corp.*#+
BJH Holdings III Corp.+
Davidson Hotel Company, LLC+
Davidson Hotel Company, LLC+
Davidson Hotel Company, LLC+
EOS Fitness Opco Holdings, LLC*#+
EOS Fitness Opco Holdings, LLC+
EOS Fitness Opco Holdings, LLC+
EOS Fitness Opco Holdings, LLC+
ESN Venture Holdings, LLC*
ESN Venture Holdings, LLC+
ESN Venture Holdings, LLC+
Harri US LLC+(23)
Harri US LLC+
Harri US LLC+(23)
Harri US LLC+(23)
Health Buyer, LLC+
Health Buyer, LLC+(5)
Health Buyer, LLC+
Health Buyer, LLC+(5)
SSRG Holdings, LLC+
SSRG Holdings, LLC+
Tropical Smoothie Cafe Holdings, LLC+
Tropical Smoothie Cafe Holdings, LLC*#
Tropical Smoothie Cafe Holdings, LLC#
Tropical Smoothie Cafe Holdings, LLC+(5)
YE Brands Holding, LLC+
YE Brands Holding, LLC+(5)
Household Durables
Groundworks LLC+
Groundworks LLC+(5)
Groundworks LLC+(5)
Household Products
WU Holdco, Inc.#+
WU Holdco, Inc.+
WU Holdco, Inc.+
WU Holdco, Inc.+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
cash/
4.00%
PIK
cash/
cash/
4.00%
4.00%
PIK
PIK
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 6.00%
SF + 6.00%
SF + 6.00%
SF + 4.50%
SF + 4.50%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 6.00%
SF + 6.00%
SF + 6.00%
SF + 10.00%
SF + 10.00%
SF + 10.00%
SF + 10.00%
SF + 5.25%
SF + 5.25%
SF + 5.50%
SF + 5.50%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 5.75%
SF + 5.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
(l)
(l)
(l)
(k)(l)
(k)
(k)
(m)
(m)
(b)(l)(m)
(l)
(l)
(l)
(l)(m)
(l)
(l)
(l)
(b)(l)
(l)
(l)
(l)
(l)
(k)(l)
(l)
(k)
(l)
(l)
(l)
(l)
(l)
11.57%
N/A(6)
11.57%
9.90%
9.92%
10.67%
10.67%
N/A(6)
10.34%
10.34%
11.00%
10.29%
11.39%
11.39%
11.27%
11.57%
N/A(6)
11.57%
11.57%
10.80%
N/A(6)
10.89%
N/A(6)
10.29%
10.29%
10.27%
10.30%
10.27%
N/A(6)
11.18%
N/A(6)
11.81%
N/A(6)
N/A(6)
11.04%
11.04%
11.04%
11.04%
See Notes to Consolidated Financial Statements.
142
Maturity
Date
08/2028
08/2028
08/2028
08/2025
08/2025
07/2025
07/2025
07/2025
01/2026
01/2026
01/2026
01/2026
10/2028
10/2028
10/2028
08/2026
08/2026
08/2026
08/2026
04/2029
04/2028
04/2029
04/2029
11/2025
11/2025
09/2026
09/2026
09/2026
09/2026
10/2027
10/2027
03/2030
03/2030
03/2029
03/2026
03/2026
03/2026
03/2025
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
7,602
—
510
50,191
280
5,468
844
—
9,295
887
104
883
3,625
16
168
840
—
552
568
2,578
—
1,171
—
990
20
19,466
12,214
5,338
—
4,950
—
7,540
(1)
493
50,681
277
5,568
840
—
9,298
887
104
875
3,582
14
142
778
—
549
567
2,547
—
1,143
(7)
983
20
19,333
12,109
5,298
(1)
4,901
—
128,560
128,520
6,891
—
—
6,891
3,703
1,305
339
30
5,377
6,706
(17)
(1)
6,688
3,738
1,305
337
30
5,410
0.3 % $
—
—
2.0
—
0.2
—
—
0.4
—
—
—
0.2
—
—
—
—
—
—
0.1
—
0.1
—
—
—
0.8
0.5
0.2
—
0.2
—
5.0
0.3
—
—
0.3
0.1
0.1
—
—
0.2
7,602
—
510
49,690
272
5,468
844
—
9,156
874
104
869
3,625
16
168
845
—
558
573
2,487
(1)
1,142
(7)
990
20
19,466
12,214
5,338
—
4,901
(1)
127,723
6,891
—
—
6,891
3,592
1,266
329
30
5,217
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Industrial Conglomerates
Arch Global CCT Holdings Corp.#+
Arch Global CCT Holdings Corp.+
Arch Global CCT Holdings Corp.+
Arch Global CCT Holdings Corp.+
Dwyer Instruments, Inc.+
Dwyer Instruments, Inc.+
Dwyer Instruments, Inc.+(5)
Essential Services Holdings Corporation+
Essential Services Holdings Corporation+(5)
Excelitas Technologies Corp.+
Excelitas Technologies Corp.+(8)(9)
Excelitas Technologies Corp.+
Excelitas Technologies Corp.+(5)
Specialty Measurement Bidco Limited+(8)(10)
Specialty Measurement Bidco Limited+(8)(9)(10)
Specialty Measurement Bidco Limited+(8)(9)(10)
Specialty Measurement Bidco Limited+(8)(10)
Specialty Measurement Bidco Limited+(8)(9)(10)
Specialty Measurement Bidco Limited+(5)(8)(9)(10)
Investment Type
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
Interest
Rate
(2)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SF +
SF +
E +
E +
4.75%
4.75%
4.75%
4.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
6.00%
6.00%
6.00%
6.25%
SF +
E +
6.25%
SN + 6.25%
(l)
(l)
(l)
(b)(l)
(k)(l)
(l)
(l)
(d)
(l)
(j)
(d)
(d)
(j)
(d)
10.22%
10.24%
10.23%
N/A(6)
11.25%
11.23%
N/A(6)
11.15%
N/A(6)
11.21%
9.54%
11.27%
N/A(6)
11.57%
9.78%
9.78%
11.81%
10.03%
N/A(6)
$
Maturity
Date
04/2026
04/2026
04/2026
04/2025
07/2027
07/2027
07/2027
11/2026
11/2025
08/2029
08/2029
08/2028
08/2029
11/2027
11/2027
11/2027
11/2027
11/2027
11/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
2,331
134
148
—
3,883
12
—
1,485
—
7,555
1,237
132
—
7,961
7,073
3,479
2,510
1,291
—
2,364
133
148
—
3,824
11
(7)
1,476
(1)
7,431
1,187
130
(12)
7,831
7,859
3,442
2,466
1,324
(36)
0.1 % $
—
—
—
0.1
—
—
0.1
—
0.3
—
—
—
0.3
0.3
0.1
0.1
0.1
—
2,284
131
145
—
3,883
12
—
1,455
(2)
7,480
1,224
130
(9)
7,961
7,073
3,479
2,516
1,294
—
39,231
39,570
1.5
39,056
See Notes to Consolidated Financial Statements.
143
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Insurance
Accession Risk Management Group, Inc.+(5)
Accession Risk Management Group, Inc.*#+
Accession Risk Management Group, Inc.+
Accession Risk Management Group, Inc.+
Accession Risk Management Group, Inc.+(5)
Accession Risk Management Group, Inc.+
Alera Group, Inc.+
Alera Group, Inc.+
Alera Group, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+(5)
Captive Resources Midco, LLC+(23)
Captive Resources Midco, LLC+(5)
Disco Parent, Inc.+
Disco Parent, Inc.+(5)
Integrated Specialty Coverages, LLC+
Integrated Specialty Coverages, LLC+(5)
Integrated Specialty Coverages, LLC+(5)
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+(5)
J.S. Held Holdings, LLC#+
J.S. Held Holdings, LLC+
J.S. Held Holdings, LLC+
J.S. Held Holdings, LLC+
J.S. Held Holdings, LLC+
J.S. Held Holdings, LLC+
Keystone Agency Partners LLC+
Keystone Agency Partners LLC+
Keystone Agency Partners LLC+
Illumifin Corporation+(23)
Majesco*#
Majesco+(5)
Norvax, LLC+(8)
Norvax, LLC+(8)
Paisley Bidco Limited+(8)(9)(10)
Paisley Bidco Limited+(5)(8)(9)(10)
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
One stop
Senior secured
Senior secured
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
Spread
Above
Index
(1)
6.00%
5.50% (l)
5.50% (l)
5.50% (l)
5.50%
5.50% (l)
6.00% (k)
6.00% (k)
6.00% (k)
5.25% (l)
5.25% (l)
5.25% (l)
5.25% (k)
5.25%
5.25% (k)
5.25%
7.50% (l)
7.50%
6.00% (k)(l)(m)
6.00%
6.00%
6.05% (l)
5.80% (l)
6.05% (l)
5.80% (l)
5.80% (l)
6.05% (l)
6.02% (l)
6.50%
6.02% (l)
6.00%
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
5.50% (l)
7.00% (l)
7.38% (l)
7.38%
7.50% (k)
7.50% (k)
6.50% (d)
6.75%
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SN +
N/A(6)
11.02%
11.03%
11.04%
N/A(6)
11.07%
11.42%
11.42%
11.42%
10.74%
10.74%
10.74%
10.67%
N/A(6)
5.29%
N/A(6)
12.92%
N/A(6)
11.38%
N/A(6)
N/A(6)
11.57%
11.32%
11.57%
11.32%
11.32%
11.57%
11.54%
N/A(6)
11.53%
N/A(6)
11.04%
11.04%
11.04%
11.04%
11.04%
11.04%
11.04%
11.04%
11.04%
6.58%
12.77%
N/A(6)
12.92%
12.92%
10.21%
N/A(6)
Interest
Rate
(2)
cash/
5.78%
PIK
cash/
6.00%
PIK
Maturity
Date
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2028
10/2028
10/2028
07/2027
07/2027
07/2027
07/2027
07/2027
07/2029
07/2028
03/2029
03/2029
07/2030
07/2029
07/2030
08/2026
08/2026
08/2026
08/2026
08/2026
08/2026
08/2026
08/2026
08/2026
08/2026
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
05/2027
05/2027
05/2027
09/2027
09/2027
09/2026
09/2025
09/2025
03/2028
03/2028
See Notes to Consolidated Financial Statements.
144
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
—
$
25,373
6,494
1,503
—
5,565
25,114
7,137
608
3,156
940
782
4
—
10,130
—
4,069
—
3,289
—
—
3,016
2,396
1,502
765
463
242
182
—
2,133
—
6,355
1,463
1,416
146
96
271
2,821
181
742
3,022
18,560
—
31,733
9,607
1,404
—
(72)
25,125
6,293
1,494
(1)
5,526
24,934
7,059
604
3,136
937
776
4
—
9,969
(3)
3,976
(1)
3,209
(1)
(9)
2,983
2,379
1,485
762
461
240
181
—
2,100
(24)
6,343
1,451
1,400
144
94
270
2,790
179
732
2,983
18,379
(2)
31,547
9,503
1,393
(52)
— % $
1.0
0.3
0.1
—
0.2
1.0
0.3
—
0.1
—
—
—
—
0.4
—
0.2
—
0.1
—
—
0.1
0.1
0.1
—
—
—
—
—
0.1
—
0.2
0.1
0.1
—
—
—
0.1
—
—
0.1
0.7
—
1.2
0.4
0.1
—
(75)
24,738
6,332
1,465
(2)
5,426
24,863
7,066
602
3,125
930
774
4
(1)
10,130
—
3,968
(1)
3,207
(1)
(9)
3,001
2,366
1,494
756
457
240
181
—
2,111
(50)
6,292
1,448
1,401
143
92
269
2,821
181
742
2,599
18,560
—
31,733
9,607
1,404
—
TABLE OF CONTENTS
Pareto Health Intermediate Holdings, Inc.+
Pareto Health Intermediate Holdings, Inc.+
Pareto Health Intermediate Holdings, Inc.+(5)
Patriot Growth Insurance Services, LLC+
Patriot Growth Insurance Services, LLC+(5)
Patriot Growth Insurance Services, LLC+
People Corporation+(8)(9)(12)
People Corporation+(8)(9)(12)
People Corporation+(8)(9)(12)
People Corporation+(5)(8)(9)(12)
People Corporation+(8)(9)(12)
Sunstar Insurance Group, LLC+
Sunstar Insurance Group, LLC+
Sunstar Insurance Group, LLC+
Sunstar Insurance Group, LLC+
Internet & Catalog Retail
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
IT Services
Acquia, Inc.+
Acquia, Inc.+
CivicPlus, LLC+(23)
CivicPlus, LLC+(23)
CivicPlus, LLC+(23)
CivicPlus, LLC+(23)
CivicPlus, LLC+
Critical Start, Inc.+(23)
Critical Start, Inc.+(23)
Critical Start, Inc.+(5)
Delinea Inc.+
Delinea Inc.#
Delinea Inc.+(5)
Optimizely North America, Inc.#+
Optimizely North America, Inc.+(8)(9)
Optimizely North America, Inc.*#
Optimizely North America, Inc.*
Optimizely North America, Inc.+(5)
Optimizely North America, Inc.+(5)
Goldcup 31018 AB+(8)(9)(17)(23)
Goldcup 31018 AB+(5)(8)(9)(17)
Goldcup 31018 AB+(8)(9)(17)(23)
Infinisource, Inc.*#
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
C +
C +
C +
C +
C +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SF +
SF +
SF +
E +
E +
E +
SF +
6.50%
6.50%
6.50%
5.75%
5.75%
5.75%
6.25%
6.25%
5.75%
6.25%
6.00%
6.00%
6.00%
6.00%
6.00%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
(m)
(m)
(l)
(b)(l)
(h)
(h)
(h)
(g)
(l)
(l)
(l)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
7.00%
7.00%
6.50%
6.50%
(a)
(l)(m)
(l)
(l)
6.50%
11.75% (m)
(l)
6.00%
6.75%
6.75%
6.75%
5.75%
5.75%
5.75%
5.50%
5.75%
5.50%
5.50%
5.50%
5.50%
6.50%
6.25%
6.50%
4.50%
(k)
(l)
(l)
(l)
(l)
(l)
(d)
(l)
(l)
(e)
(e)
(m)
11.97%
11.97%
N/A(6)
11.28%
N/A(6)
11.29%
11.75%
11.75%
11.21%
N/A(6)
11.44%
11.54%
11.54%
11.54%
11.42%
11.29%
11.29%
11.29%
11.29%
11.29%
11.29%
11.30%
11.24%
12.34%
12.67%
9.57%
9.57%
9.57%
17.00%
11.42%
8.46%
8.46%
N/A(6)
11.29%
11.29%
N/A(6)
11.04%
9.69%
11.04%
11.04%
N/A(6)
N/A(6)
10.43%
N/A(6)
10.43%
10.09%
cash/
cash/
cash/
PIK
cash/
cash/
2.50%
2.50%
2.50%
3.63%
3.63%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
See Notes to Consolidated Financial Statements.
145
Maturity
Date
05/2030
05/2030
06/2029
10/2028
10/2028
10/2028
02/2028
02/2028
02/2028
02/2027
02/2028
10/2026
10/2026
10/2026
10/2026
04/2027
04/2027
04/2027
04/2027
04/2027
04/2027
04/2027
04/2027
10/2025
10/2025
08/2027
08/2027
08/2027
06/2034
08/2027
05/2028
05/2028
05/2028
03/2028
03/2028
03/2027
04/2026
04/2026
04/2026
04/2026
04/2026
04/2026
07/2029
01/2029
07/2029
10/2026
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
14,460
4,820
—
10,951
—
1,449
13,608
4,442
11,352
—
178
767
914
389
2
14,184
4,728
(1)
10,872
—
1,431
14,424
4,834
11,485
(1)
154
760
909
385
2
246,012
244,842
14,860
8,698
4,313
2,598
1,674
393
29
43
14,773
8,646
4,287
2,583
1,663
391
27
41
32,608
32,411
9,578
27
6,319
3,732
2,962
234
6
3,343
1,525
—
16,412
9,488
—
21,277
18,752
11,813
6,535
—
—
8,621
—
804
27,517
9,532
27
6,267
3,705
2,938
229
6
3,318
1,498
(1)
16,257
9,395
(2)
21,112
19,978
11,839
6,479
(2)
(2)
8,132
(2)
793
27,273
0.6 % $
0.2
—
0.4
—
0.1
0.5
0.2
0.4
—
—
—
—
—
—
9.5
0.5
0.3
0.2
0.1
0.1
—
—
—
1.2
0.4
—
0.3
0.2
0.1
—
—
0.1
0.1
—
0.6
0.4
—
0.8
0.7
0.5
0.3
—
—
0.3
—
—
1.1
14,460
4,820
—
10,732
(1)
1,404
13,608
4,442
11,152
(3)
129
767
914
389
2
243,204
13,969
8,176
4,054
2,442
1,574
370
15
40
30,640
9,578
27
6,256
3,695
2,932
232
6
3,310
1,510
(1)
16,084
9,299
(4)
20,850
18,377
11,577
6,404
(11)
(10)
8,535
(1)
790
27,517
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+(5)
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Netwrix Corporation*+
Netwrix Corporation+
Netwrix Corporation+(5)
PCS Intermediate II Holdings, LLC#
PCS Intermediate II Holdings, LLC#
PCS Intermediate II Holdings, LLC+
Recordxtechnologies, LLC#(23)
Recordxtechnologies, LLC+(23)
Recordxtechnologies, LLC+(23)
Red Dawn SEI Buyer, Inc.+(8)(9)
Red Dawn SEI Buyer, Inc.+
Red Dawn SEI Buyer, Inc.+
Red Dawn SEI Buyer, Inc.+
Red Dawn SEI Buyer, Inc.+(5)
Red Dawn SEI Buyer, Inc.+
Red Dawn SEI Buyer, Inc.+
ReliaQuest Holdings, LLC+
ReliaQuest Holdings, LLC+
ReliaQuest Holdings, LLC+
Saturn Borrower Inc.+(23)
Saturn Borrower Inc.+
WPEngine, Inc.+
WPEngine, Inc.+(5)
Zarya Holdco, Inc.+
Zarya Holdco, Inc.+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
5.00%
5.00%
5.00%
5.25%
5.25%
5.25%
6.50%
6.50%
6.50%
4.50%
4.50%
4.25%
4.25%
4.50%
4.25%
(m)
(m)
(m)
(m)
(m)
(l)
(m)
(m)
(m)
(l)(m)
(m)
(l)
(l)
(l)
(l)
(l)
(i)
(l)
(l)
(l)
(l)
4.50%
(l)
10.75% (l)
10.75% (l)
10.75% (l)
(l)
6.50%
6.50%
6.50%
6.50%
6.50%
6.50%
(l)
(m)
(l)
(l)
10.09%
10.09%
10.09%
10.09%
10.09%
10.06%
N/A(6)
10.09%
10.09%
10.09%
10.37%
10.47%
N/A(6)
10.77%
10.77%
N/A(6)
11.89%
11.89%
11.89%
9.69%
9.99%
9.74%
9.74%
N/A(6)
9.74%
9.99%
16.12%
16.12%
16.12%
12.04%
12.04%
11.92%
N/A(6)
11.92%
11.91%
Maturity
Date
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
06/2029
06/2029
06/2029
01/2026
01/2026
01/2026
12/2025
12/2025
12/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
10/2026
10/2026
10/2026
09/2026
09/2026
08/2029
08/2029
07/2027
07/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
8,318
2,006
301
213
104
32
—
85
484
285
4,196
44
—
14,056
2,029
—
729
114
62
20,842
5,486
729
130
—
13
318
1,098
266
82
19,897
103
3,522
—
4,777
20
8,267
1,979
299
212
104
29
(1)
77
481
278
4,168
42
(6)
14,001
2,019
—
724
113
61
23,302
5,461
726
129
—
13
317
1,083
266
81
19,596
101
3,453
(1)
4,777
20
239,286
240,940
% $
0.3
0.1
—
—
—
—
—
—
—
—
0.2
—
—
0.6
0.1
—
—
—
—
0.8
0.2
—
—
—
—
—
0.1
—
—
0.7
—
0.1
—
0.2
—
9.3
8,318
2,006
301
213
104
32
—
85
484
285
4,112
40
(24)
14,056
2,029
—
714
112
60
20,634
5,431
718
128
(1)
12
315
1,098
266
82
19,101
99
3,469
(1)
4,777
20
236,027
See Notes to Consolidated Financial Statements.
146
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Leisure Products
WBZ Investment LLC#+(23)
WBZ Investment LLC+(23)
WBZ Investment LLC+(23)
WBZ Investment LLC+(23)
WBZ Investment LLC+
Life Sciences Tools & Services
Celerion Buyer, Inc.*#
Celerion Buyer, Inc.+(5)
Celerion Buyer, Inc.+(5)
Covaris Intermediate 3, LLC+
Covaris Intermediate 3, LLC+(5)
Covaris Intermediate 3, LLC+
PAS Parent Inc.*#+
PAS Parent Inc.+(5)
PAS Parent Inc.+(5)
Reaction Biology Corporation#
Reaction Biology Corporation+(5)
Reaction Biology Corporation+
Reaction Biology Corporation+
Reaction Biology Corporation+
Unchained Labs, LLC+
Unchained Labs, LLC+
Unchained Labs, LLC+
Machinery
Bad Boy Mowers Acquisition, LLC+
Blackbird Purchaser, Inc.*+
Blackbird Purchaser, Inc.+
Chase Industries, Inc.+(23)(24)
Chase Industries, Inc.+(23)(24)
Chase Industries, Inc.+(23)(24)
Marine
Project Nike Purchaser, LLC+
Project Nike Purchaser, LLC+
Media
Triple Lift, Inc.+
Triple Lift, Inc.+
Triple Lift, Inc.+
Multiline Retail
Mills Fleet Farm Group LLC*#+
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Spread
Above
Index
(1)
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
(l)
(l)
(l)
(l)
SF + 6.50%
(m)
SF + 6.50%
SF + 6.50%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 4.25%
SF + 4.25%
SF + 4.25%
SF + 7.00%
SF + 7.00%
SF + 7.00%
(l)
(l)
(k)
(l)
(l)
(m)
(l)
(k)
(k)
(k)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
One stop
One stop
SF + 6.00%
SF + 6.00%
One stop
One stop
One stop
SF + 5.75%
SF + 5.75%
SF + 5.75%
Interest
Rate
(2)
cash/
cash/
cash/
cash/
1.00%
1.00%
1.00%
1.00%
PIK
PIK
PIK
PIK
cash/
cash/
cash/
1.50%
1.50%
1.50%
PIK
PIK
PIK
11.04%
11.04%
11.04%
11.04%
N/A(6)
11.93%
N/A(6)
N/A(6)
10.79%
N/A(6)
10.79%
10.68%
N/A(6)
N/A(6)
10.79%
N/A(6)
10.79%
10.87%
10.79%
10.87%
10.87%
N/A(6)
9.68%
9.67%
N/A(6)
11.04%
11.04%
11.04%
11.39%
11.39%
11.30%
11.30%
11.20%
Maturity
Date
09/2024
09/2024
09/2024
09/2024
09/2024
11/2029
11/2028
11/2029
01/2028
01/2028
01/2028
12/2028
12/2027
12/2028
03/2029
03/2029
03/2029
03/2029
03/2029
08/2027
08/2027
08/2027
03/2028
04/2026
10/2025
05/2025
05/2025
05/2025
04/2029
04/2029
05/2028
05/2028
05/2028
$
$
8,425
1,240
861
449
—
8,444
1,237
868
452
—
10,975
11,001
21,380
—
—
5,850
—
39
33,571
—
—
7,943
—
75
182
121
989
835
—
20,918
(1)
(73)
5,807
—
37
33,063
(7)
(4)
7,880
(2)
74
180
120
982
824
—
70,985
69,798
1,866
19,174
—
12,059
985
170
34,254
19,572
75
19,647
5,289
1,122
27
6,438
1,863
19,259
—
12,059
985
170
34,336
19,417
73
19,490
5,220
1,105
26
6,351
One stop
SF + 6.50%
(l)
12.02%
10/2024
45,138
45,113
See Notes to Consolidated Financial Statements.
147
% $
0.3
0.1
—
—
—
0.4
0.9
—
—
0.2
—
—
1.3
—
—
0.3
—
—
—
—
—
—
—
2.7
0.1
0.8
—
0.4
—
—
1.3
0.7
—
0.7
0.2
—
—
0.2
1.8
8,425
1,240
861
449
—
10,975
21,380
—
—
5,557
(3)
25
32,898
(7)
(2)
7,546
(10)
68
173
115
979
827
—
69,546
1,866
19,174
—
11,004
900
138
33,082
18,985
68
19,053
5,077
1,077
25
6,179
45,138
TABLE OF CONTENTS
Oil, Gas & Consumable Fuels
3ES Innovation, Inc.*+(8)(12)
3ES Innovation, Inc.+(8)(12)
Envernus, Inc.*#+
Envernus, Inc.+
Envernus, Inc.+
Project Power Buyer, LLC*#+
Project Power Buyer, LLC+(5)
Paper & Forest Products
Messenger, LLC#+
Messenger, LLC+
Messenger, LLC+
Messenger, LLC+
Personal Products
IMPLUS Footcare, LLC+(23)
IMPLUS Footcare, LLC+(23)
IMPLUS Footcare, LLC*+(23)
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
Interest
Rate
(2)
SF + 6.50%
SF + 6.50%
SF + 4.25%
SF + 4.50%
SF + 4.50%
SF + 7.00%
SF + 7.00%
SF + 5.75%
SF + 5.75%
SF + 5.75%
4.75%
P +
SF + 8.75%
SF + 8.75%
SF + 8.75%
(k)
(k)
(k)
(k)
(k)
(l)
(l)
(l)
(l)
(b)
(l)
(l)
(l)
11.92%
11.92%
9.67%
9.92%
9.92%
12.39%
N/A(6)
11.29%
11.27%
11.29%
13.25%
13.30%
13.30%
13.30%
cash/
cash/
cash/
1.00%
1.00%
1.00%
PIK
PIK
PIK
Maturity
Date
05/2025
05/2025
07/2025
07/2025
09/2026
05/2026
05/2025
12/2027
12/2027
12/2027
12/2027
07/2024
07/2024
07/2024
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
20,210
80
38,453
16,960
66
40,066
—
20,261
79
38,575
16,791
61
39,553
(1)
115,835
115,319
10,074
10,001
99
49
21
98
49
21
10,243
10,169
30,496
5,208
751
36,455
30,574
5,222
755
36,551
% $
0.8
—
1.5
0.7
—
1.5
—
4.5
0.4
—
—
—
0.4
1.2
0.2
—
1.4
20,210
80
38,259
16,960
66
40,066
—
115,641
9,670
95
47
19
9,831
28,852
4,927
710
34,489
See Notes to Consolidated Financial Statements.
148
TABLE OF CONTENTS
Pharmaceuticals
ACP Ulysses Buyer, Inc.*#
ACP Ulysses Buyer, Inc.*
Amalthea Parent, Inc.*#+(8)(12)
Amalthea Parent, Inc.+(5)(8)(12)
Apothecary Products, LLC+
Apothecary Products, LLC+(5)
Caerus Midco 3 S.A.R.L.+(8)(13)
Caerus Midco 3 S.A.R.L.+(8)(13)
Caerus Midco 3 S.A.R.L.+(8)(13)
Caerus Midco 3 S.A.R.L.+(8)(13)
Caerus Midco 3 S.A.R.L.+(8)(13)
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Spark Bidco Limited+(8)(9)(10)
Spark Bidco Limited+(8)(9)(10)
Spark Bidco Limited+(5)(8)(9)(10)
Spark Bidco Limited+(8)(9)(10)
Spark Bidco Limited+(8)(9)(10)
Spark Bidco Limited+(8)(10)
Professional Services
ALKU Intermediate Holdings, LLC+
bswift, LLC+
Citrin Cooperman Advisors LLC+
Citrin Cooperman Advisors LLC+(5)
Citrin Cooperman Advisors LLC+
DISA Holdings Corp.+
DISA Holdings Corp.+
DISA Holdings Corp.+
DISA Holdings Corp.+
DISA Holdings Corp.+(23)
Eliassen Group, LLC+
Eliassen Group, LLC+
Filevine, Inc.+(23)
Filevine, Inc.+
IG Investments Holdings, LLC+
IG Investments Holdings, LLC+(5)
IG Investments Holdings, LLC+
NBG Acquisition Corp. and NBG-P Acquisition Corp.#
NBG Acquisition Corp. and NBG-P Acquisition Corp.+(5)
NBG Acquisition Corp. and NBG-P Acquisition Corp.+
NBG Acquisition Corp. and NBG-P Acquisition Corp.+(5)
Net Health Acquisition Corp.+
Net Health Acquisition Corp.*#
Net Health Acquisition Corp.*
Investment Type
One stop
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
Subordinated debt
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SN +
SN +
SN +
SN +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
5.50%
5.50%
5.00%
5.00%
6.50%
6.50%
5.50%
5.75%
5.75%
5.75%
5.75%
6.00%
6.00%
6.00%
6.00%
4.75%
4.75%
4.75%
6.00%
4.75%
6.00%
6.25%
6.63%
5.75%
6.25%
6.25%
5.50%
5.50%
5.50%
5.50%
10.00%
5.50%
5.50%
6.50%
6.50%
6.00%
6.00%
6.00%
5.25%
5.25%
5.25%
5.25%
5.75%
5.75%
5.75%
(l)
(l)
(k)
(m)
(l)
(k)
(m)
(l)
(m)
(k)
(k)
(k)
(k)
(i)
(i)
(i)
(i)
(l)
(k)
(l)
(l)
(m)
(k)
(k)
(k)
(k)
(k)
(m)
(k)(l)
(l)(m)
(k)(l)
(l)
(l)
(l)
(k)
(k)
(k)
11.04%
11.04%
10.43%
N/A(6)
12.10%
N/A(6)
10.89%
11.07%
11.21%
11.14%
11.21%
11.43%
11.43%
11.43%
11.43%
9.94%
9.94%
N/A(6)
11.19%
9.94%
11.39%
11.57%
11.91%
11.14%
N/A(6)
11.70%
10.83%
10.83%
10.83%
10.83%
13.33%
10.84%
10.86%
9.13%
N/A(6)
11.45%
N/A(6)
11.47%
10.77%
N/A(6)
10.78%
N/A(6)
11.17%
11.17%
11.17%
cash/
2.00%
PIK
cash/
2.50%
PIK
See Notes to Consolidated Financial Statements.
149
Maturity
Date
02/2026
02/2026
03/2027
03/2027
07/2025
07/2025
05/2029
05/2029
05/2029
05/2029
05/2029
10/2028
10/2027
10/2028
10/2028
08/2028
08/2028
02/2028
08/2028
08/2028
08/2028
05/2029
11/2028
10/2027
10/2027
10/2027
09/2028
09/2028
09/2028
09/2028
03/2029
04/2028
04/2028
04/2027
04/2027
09/2028
09/2027
09/2028
11/2028
11/2028
11/2028
11/2028
12/2025
12/2025
12/2025
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
25,232
1,091
58,695
—
2,632
—
17,007
74
1,148
2,814
182
10,520
12
3,527
2,658
23,923
2,537
—
3,320
2,900
2,613
25,089
1,076
58,287
(2)
2,608
(7)
16,733
69
1,117
2,766
177
10,370
11
3,475
2,570
26,689
2,505
(2)
3,257
2,689
2,568
160,885
162,045
4,444
5,100
4,203
—
2,329
3,477
7
220
151
51
1,430
9
5,400
—
6,468
—
553
7,517
—
157
—
13,101
8,290
6,637
4,382
4,964
4,160
(9)
2,267
3,419
6
215
145
49
1,419
9
5,347
—
6,380
(1)
545
7,477
(12)
156
(15)
13,041
8,275
6,662
% $
1.0
—
2.1
—
0.1
—
0.7
—
—
0.1
—
0.4
—
0.1
0.1
0.9
0.1
—
0.1
0.1
0.1
5.9
0.2
0.2
0.2
—
0.1
0.1
—
—
—
—
0.1
—
0.2
—
0.3
—
—
0.3
—
—
—
0.5
0.3
0.3
23,970
1,036
53,997
(22)
2,632
—
16,497
68
1,096
2,758
174
10,310
10
3,457
2,604
22,129
2,347
(6)
3,221
2,682
2,535
151,495
4,389
5,100
4,203
—
2,334
3,477
7
220
151
51
1,430
9
5,454
—
6,468
—
553
7,291
—
150
—
12,839
8,124
6,504
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Net Health Acquisition Corp.#
Net Health Acquisition Corp.*#
Net Health Acquisition Corp.+
PlanSource Holdings, Inc.+
PlanSource Holdings, Inc.+
PlanSource Holdings, Inc.+
PlanSource Holdings, Inc.+
Procure Acquireco, Inc.#+
Procure Acquireco, Inc.+(5)
Procure Acquireco, Inc.+(5)
Teaching Company, The+
Teaching Company, The+
Real Estate Management & Development
Inhabit IQ Inc.+
Inhabit IQ Inc.#+
Inhabit IQ Inc.+
Inhabit IQ Inc.*
Inhabit IQ Inc.*#
Inhabit IQ Inc.+
Inhabit IQ Inc.#+
Inhabit IQ Inc.#+
Inhabit IQ Inc.#+
Inhabit IQ Inc.+
Inhabit IQ Inc.+
Inhabit IQ Inc.+
MRI Software LLC*+
MRI Software LLC+
MRI Software LLC+(5)
RPL Bidco Limited+(8)(9)(10)
RPL Bidco Limited+(8)(9)(10)
RPL Bidco Limited+(5)(8)(9)(10)
RPL Bidco Limited+(8)(9)(10)
Road & Rail
Channelside Acquisitona Co, Inc.+
Channelside Acquisitona Co, Inc.+(5)
Channelside Acquisitona Co, Inc.+
Channelside Acquisitona Co, Inc.+(5)
Internet Truckstop Group LLC*#
Internet Truckstop Group LLC+
Internet Truckstop Group LLC+(5)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
5.75%
5.75%
5.75%
6.25%
6.25%
6.25%
6.25%
5.00%
5.00%
5.00%
5.75%
5.75%
(k)
(k)
(k)
(m)
(m)
(m)
(l)
(l)
(b)(l)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SN +
A +
SN +
A +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (k)
5.50% (l)
5.50% (l)
5.50%
5.50% (i)
5.50% (f)
5.50%
6.75% (f)
6.38% (k)
6.75%
6.75% (k)
6.75%
5.00% (l)
5.00% (l)
5.00%
11.17%
11.17%
11.17%
11.90%
11.90%
11.90%
N/A(6)
10.57%
N/A(6)
N/A(6)
11.27%
11.76%
%
10.92%
10.92%
10.92%
10.92%
10.92%
10.92%
10.92%
10.92%
10.92%
10.92%
10.92%
10.92%
10.99%
10.99%
N/A(6)
10.69%
9.63%
N/A(6)
10.93%
11.79%
N/A(6)
12.08%
N/A(6)
10.54%
10.54%
N/A(6)
Maturity
Date
12/2025
12/2025
12/2025
04/2025
04/2025
04/2025
04/2025
12/2028
12/2028
12/2028
01/2026
01/2026
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
02/2026
02/2026
02/2026
08/2028
08/2028
02/2028
08/2028
07/2028
07/2026
07/2028
07/2028
04/2025
04/2025
04/2025
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
4,194
1,159
86
11,416
1,932
139
—
17,456
—
—
13,791
80
4,167
1,156
86
11,446
1,925
138
—
17,326
(1)
(2)
13,791
80
119,797
118,993
21,533
19,232
13,254
12,242
6,450
3,143
1,381
1,169
1,152
922
486
130
14,211
5,350
—
17,820
1,920
—
7,910
21,433
19,227
13,208
12,185
6,453
3,167
1,383
1,171
1,154
920
487
130
14,156
5,317
(1)
20,075
2,177
—
8,138
0.2 % $
—
—
0.4
0.1
—
—
0.7
—
—
0.5
—
4.7
0.8
0.8
0.5
0.5
0.3
0.1
0.1
0.1
—
—
—
—
0.5
0.2
—
0.7
0.1
—
0.3
4,110
1,135
80
11,416
1,932
139
—
17,456
—
—
13,791
80
118,893
21,533
19,232
13,254
12,242
6,450
3,143
1,381
1,169
1,152
922
486
130
13,927
5,243
(5)
17,152
1,848
(2)
7,949
128,305
130,780
5.0
127,206
4,229
—
3,948
—
21,118
9,248
—
38,543
4,158
(2)
3,847
(2)
21,278
9,196
(1)
38,474
0.2
—
0.2
—
0.8
0.3
—
1.5
4,229
—
3,968
—
21,118
9,248
—
38,563
See Notes to Consolidated Financial Statements.
150
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
cash/
3.25%
PIK
cash/
cash/
2.75%
3.25%
PIK
PIK
Software
Anaplan, Inc.+
Anaplan, Inc.+(5)
Appfire Technologies, LLC#+
Appfire Technologies, LLC+(5)
Appfire Technologies, LLC+(5)
Aras Corporation+(23)
Aras Corporation+
Armstrong Bidco Limited+(8)(9)(10)
Armstrong Bidco Limited+(8)(9)(10)
Arrow Buyer, Inc.+
Arrow Buyer, Inc.+(5)
Auvik Networks Inc.+(8)(12)(23)
Auvik Networks Inc.+(8)(12)(23)
Auvik Networks Inc.+(5)(8)(12)
Axiom Merger Sub Inc.+
Axiom Merger Sub Inc.+(8)(9)
Axiom Merger Sub Inc.+
Axiom Merger Sub Inc.+
Axiom Merger Sub Inc.+
Bayshore Intermediate #2, L.P.+(23)
Bayshore Intermediate #2, L.P.+
Bonterra LLC+
Bonterra LLC+(5)
Bonterra LLC+
Bottomline Technologies, Inc.+
Bottomline Technologies, Inc.+(5)
Bullhorn, Inc.*#+
Bullhorn, Inc.+(8)(9)
Bullhorn, Inc.+(8)(9)
Bullhorn, Inc.+
Bullhorn, Inc.+
Bullhorn, Inc.+
Bullhorn, Inc.+(5)
Burning Glass Intermediate Holdings Company, Inc.#+
Burning Glass Intermediate Holdings Company, Inc.+
Bynder BidCo, Inc.& Bynder BidCo B.V.+(8)(14)
Bynder BidCo, Inc.& Bynder BidCo B.V.+(8)(14)
Bynder BidCo, Inc.& Bynder BidCo B.V.+(8)(14)
Bynder BidCo, Inc.& Bynder BidCo B.V.+(5)(8)(14)
Calabrio, Inc.+
Calabrio, Inc.+
Camelia Bidco Limited+(8)(9)(10)
Camelia Bidco Limited+(8)(9)(10)
Camelia Bidco Limited+(5)(8)(9)(10)
Community Brands Parentco LLC+
Community Brands Parentco LLC+(5)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SN +
SN +
SF +
SF +
SF +
SF +
SF +
L +
E +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SN +
E +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SN +
A +
SN +
SF +
SF +
6.50% (k)
6.50%
5.50% (l)
5.50%
5.50%
6.75% (l)
6.50% (b)(l)
5.00% (i)
5.00% (i)
6.50% (l)
6.50%
5.75% (l)
6.25% (l)
3.00%
5.25% (a)
5.50% (d)(e)
5.25% (a)
5.25% (m)
5.25%
7.50% (l)
6.50% (l)
7.25% (l)
7.25%
8.00% (l)
5.25% (k)
5.00%
5.75% (l)
6.00% (i)
5.75% (d)
5.75% (l)
5.75% (l)
5.75% (l)
5.75%
5.00% (k)
5.00% (k)
7.25% (l)
7.25% (l)
7.25%
7.25%
7.13% (k)
7.13% (k)
6.25% (i)
6.25% (f)
6.25%
5.50% (l)
5.50%
11.82%
N/A(6)
11.06%
N/A(6)
N/A(6)
8.95%
12.14%
10.19%
10.19%
11.89%
N/A(6)
8.52%
8.52%
N/A(6)
10.60%
8.90%
10.60%
10.86%
N/A(6)
13.00%
11.87%
12.64%
N/A(6)
13.39%
10.57%
N/A(6)
11.24%
11.19%
9.69%
11.24%
11.24%
11.24%
N/A(6)
10.42%
10.42%
12.60%
12.60%
N/A(6)
N/A(6)
12.44%
12.45%
11.44%
10.39%
N/A(6)
11.02%
N/A(6)
06/2029
06/2028
03/2027
03/2027
03/2027
04/2027
04/2027
06/2029
06/2029
06/2030
06/2030
07/2027
07/2027
07/2027
04/2026
04/2026
04/2026
04/2026
10/2025
10/2028
10/2027
09/2027
09/2027
09/2027
05/2029
05/2028
09/2026
09/2026
09/2026
09/2026
09/2026
09/2026
09/2026
06/2028
06/2026
01/2029
01/2029
01/2029
01/2029
04/2027
04/2027
08/2030
08/2030
08/2030
02/2028
02/2028
$
9,840
$
—
39,442
—
—
14,687
67
3,496
1,824
16,360
—
7,232
1,293
—
5,677
2,215
269
39
—
73,822
33
65,427
—
2,855
27,881
—
65,269
11,553
4,523
212
95
76
—
9,720
21
5,437
1,438
—
—
53,683
135
3,125
204
—
14,052
—
9,760
(1)
39,102
(2)
(30)
14,605
67
3,420
1,734
15,943
(23)
7,189
1,283
—
5,695
2,347
267
38
—
72,859
31
64,789
(2)
2,812
27,434
(3)
64,735
11,556
4,640
210
94
75
(2)
9,588
20
5,291
1,399
—
(1)
53,207
132
3,193
201
(20)
13,846
(1)
0.4 % $
—
1.5
—
—
0.6
—
0.1
0.1
0.6
—
0.3
0.1
—
0.2
0.1
—
—
—
2.9
—
2.5
—
0.1
1.1
—
2.5
0.4
0.2
—
—
—
—
0.4
—
0.2
0.1
—
—
2.1
—
0.1
—
—
0.6
—
9,840
—
38,653
(5)
(68)
14,541
66
3,321
1,733
16,155
(47)
7,124
1,293
(1)
5,677
2,215
269
39
—
73,822
33
63,465
(6)
2,769
26,696
(7)
64,616
11,438
4,478
209
94
75
(2)
9,720
21
5,437
1,438
—
—
53,683
135
3,078
201
(20)
13,771
(1)
See Notes to Consolidated Financial Statements.
151
TABLE OF CONTENTS
Community Brands Parentco LLC+(5)
Coupa Holdings, LLC+
Coupa Holdings, LLC+(5)
Coupa Holdings, LLC+(5)
Daxko Acquisition Corporation+
Daxko Acquisition Corporation+
Daxko Acquisition Corporation+
Daxko Acquisition Corporation+(5)
Denali Bidco Limited+(8)(9)(10)
Denali Bidco Limited+(8)(9)(10)
Denali Bidco Limited+(5)(8)(9)(10)
Diligent Corporation*#+
Diligent Corporation+
Diligent Corporation+
Dragon UK Bidco Limited+(8)(9)(10)
Dragon UK Bidco Limited+(8)(9)(10)
Dragon UK Bidco Limited+(5)(8)(9)(10)
Evergreen IX Borrower 2023, LLC+
Evergreen IX Borrower 2023, LLC+(5)
FirstUp, Inc.+(23)
FirstUp, Inc.+(5)(23)
FirstUp, Inc.+(23)
Gainsight, Inc.+(23)
Gainsight, Inc.+(23)
GS Acquisitionco, Inc.*#+
GS Acquisitionco, Inc.+(5)
GTIV, LLC+
GTIV, LLC+(5)
GTY Technology Holdings, Inc.+(23)
GTY Technology Holdings, Inc.+(5)
GTY Technology Holdings, Inc.+(23)
GTY Technology Holdings, Inc.+(23)
Hyland Software, Inc.+
Hyland Software, Inc.+(5)
ICIMS, Inc.+(23)
ICIMS, Inc.+
ICIMS, Inc.+(5)
IQN Holding Corp. #+
IQN Holding Corp. +(5)
IQN Holding Corp. +(5)
Island Bidco AB+(8)(9)(17)(23)
Island Bidco AB+(8)(17)(23)
Island Bidco AB+(8)(17)
Island Bidco AB+(5)(8)(9)(17)
Juvare, LLC*
Juvare, LLC+
Juvare, LLC+
Juvare, LLC+
Kaseya Inc.+(23)
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
P +
SF +
SN +
E +
SN +
SF +
SF +
SF +
SN +
C +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SF +
E +
SF +
SF +
SF +
SF +
SF +
5.50%
7.50% (k)
7.50%
7.50%
5.50% (k)
5.50% (k)
4.50% (b)
5.50%
6.00% (i)
6.00% (c)
6.00%
6.25% (l)
5.75% (l)
6.25% (l)
5.75% (i)
5.75% (h)
5.75%
6.00% (l)
6.00%
6.75% (l)
7.50%
7.50% (l)
6.75% (l)
6.75% (l)
5.75% (l)
5.75%
5.25% (k)
5.25%
6.87% (l)
6.25%
6.88% (l)
6.88% (l)
6.00% (k)
6.00%
7.25% (l)
6.75% (l)
7.25%
5.25% (l)
5.25%
5.25%
7.25% (e)
7.00% (m)
6.50%
6.50%
6.25% (l)
6.25% (l)
6.25% (l)
6.25% (b)(l)
6.25% (l)
N/A(6)
12.82%
N/A(6)
N/A(6)
10.92%
10.92%
13.00%
N/A(6)
11.19%
9.86%
N/A(6)
11.77%
11.27%
11.77%
10.94%
11.26%
N/A(6)
11.39%
N/A(6)
8.64%
N/A(6)
8.64%
12.27%
12.27%
11.29%
N/A(6)
10.67%
N/A(6)
7.97%
N/A(6)
7.97%
7.97%
11.32%
N/A(6)
8.76%
12.14%
N/A(6)
10.67%
N/A(6)
N/A(6)
3.93%
8.84%
N/A(6)
N/A(6)
11.82%
11.82%
11.82%
12.01%
9.12%
cash/
3.50%
PIK
4.25%
PIK
cash/
PIK
PIK
cash/
4.30%
PIK
cash/
cash/
4.30%
4.30%
PIK
PIK
cash/
3.88%
PIK
cash/
cash/
7.25%
3.50%
PIK
PIK
cash/
2.50%
PIK
See Notes to Consolidated Financial Statements.
152
$
Maturity
Date
02/2028
02/2030
02/2029
02/2030
10/2028
10/2028
10/2027
10/2028
08/2030
08/2030
08/2030
08/2025
08/2025
08/2025
02/2029
02/2029
02/2029
09/2030
10/2029
07/2027
07/2027
07/2027
07/2027
07/2027
05/2026
05/2026
02/2029
02/2029
07/2029
07/2029
07/2029
07/2029
09/2030
09/2029
08/2028
08/2028
08/2028
05/2029
05/2028
05/2029
07/2028
07/2028
07/2028
07/2028
10/2026
10/2026
10/2026
04/2026
06/2029
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
—
22,905
—
—
27,431
2,313
22
—
2,917
732
—
85,408
5,904
133
14,139
282
—
4,506
—
9,236
—
876
11,106
56
83,759
—
73,471
—
3,237
—
2,114
387
4,950
—
8,009
27
—
14,613
—
—
6,275
3,051
—
—
7,526
1,737
548
50
9,197
(1)
22,382
(1)
(23)
27,233
2,289
21
(8)
2,948
735
(13)
85,363
5,879
133
15,100
294
—
4,393
(12)
9,160
(1)
863
11,001
55
83,809
—
72,908
(2)
3,187
(2)
2,076
384
4,876
(1)
7,899
26
—
14,497
(1)
(25)
6,149
3,028
—
(1)
7,478
1,726
540
50
9,084
— % $
0.9
—
—
1.0
0.1
—
—
0.1
—
—
3.3
0.2
—
0.6
—
—
0.2
—
0.4
—
—
0.4
—
3.3
—
2.9
—
0.1
—
0.1
—
0.2
—
0.3
—
—
0.6
—
—
0.2
0.1
—
—
0.3
0.1
—
—
0.4
(2)
22,332
(1)
(51)
26,334
2,221
17
(44)
2,844
714
(13)
84,553
5,800
130
13,715
274
(3)
4,393
(12)
9,120
(1)
865
10,995
55
82,920
(2)
73,471
—
3,205
(1)
2,093
384
4,876
(1)
7,849
24
(37)
14,321
(2)
(3)
6,275
3,051
—
—
7,150
1,650
541
48
9,105
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Kaseya Inc.+(23)
Kaseya Inc.+(23)
LeadsOnline, LLC+
LeadsOnline, LLC+
LeadsOnline, LLC+(5)
Mindbody, Inc.+
Mindbody, Inc.+
Mindbody, Inc.+
Ministry Brands Holdings LLC+
Ministry Brands Holdings LLC+
Ministry Brands Holdings LLC+
Neo Bidco GMBH+(8)(9)(13)(23)
Neo Bidco GMBH+(8)(13)
Neo Bidco GMBH+(8)(9)(13)
Naviga Inc.+
Panzura, LLC+(23)
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+(8)(9)
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
Personify, Inc.*#+
Personify, Inc.#
Personify, Inc.+
PING Identity Holding Corp.+
PING Identity Holding Corp.+(5)
Pluralsight, LLC+
Pluralsight, LLC+
ProcessUnity Holdings, LLC+
ProcessUnity Holdings, LLC+(5)
ProcessUnity Holdings, LLC+
ProcessUnity Holdings, LLC+
Pyramid Healthcare Acquisition Corp.#+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+(5)
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
QAD, Inc.+
QAD, Inc.+(5)
Quant Buyer, Inc.+
Interest
Rate
(2)
cash/
cash/
2.50%
2.50%
PIK
PIK
cash/
13.00%
PIK
Investment Type
Spread
Above
Index
(1)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
One stop
One stop
Second lien
One stop
One stop
Second lien
Second lien
One stop
One stop
Second lien
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
E +
SF +
N/A
SF +
SF +
SF +
SF +
SF +
SF +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
6.25% (k)
6.25% (l)
6.25% (k)
6.25% (k)
6.25%
7.00% (l)
7.00% (l)
7.00%
5.50% (k)
5.50% (k)
5.50% (k)(l)
6.00% (e)
6.00%
6.00% (d)(e)
7.00% (l)
4.50% (l)
8.50% (l)
4.50% (l)
4.50% (l)
8.71% (l)
8.53% (l)
4.50% (i)
4.50% (l)
8.50% (l)
5.25% (l)
5.25% (l)
5.25%
7.00% (k)
7.00%
8.00% (l)
8.00% (l)
6.75% (k)
6.75%
6.75% (l)
6.75% (l)
4.75% (l)
4.75% (l)
4.75% (l)
4.75% (l)
4.75% (l)
4.75% (l)
4.75% (l)
4.75% (l)
4.75% (l)
4.75%
4.75% (l)
4.75% (l)
5.38% (k)
5.38%
6.00% (m)
9.07%
9.12%
11.58%
11.58%
N/A(6)
12.52%
12.52%
N/A(6)
10.92%
10.92%
10.99%
9.95%
N/A(6)
9.95%
12.49%
2.00%
9.98%
14.03%
9.98%
9.98%
14.24%
14.06%
9.81%
9.98%
14.03%
10.64%
10.64%
N/A(6)
12.32%
N/A(6)
13.45%
13.47%
12.07%
N/A(6)
12.14%
12.14%
10.27%
10.32%
10.27%
10.27%
10.27%
10.27%
10.32%
10.27%
10.27%
N/A(6)
10.30%
10.28%
10.69%
N/A(6)
11.30%
Maturity
Date
06/2029
06/2029
02/2028
02/2028
02/2028
02/2025
02/2025
02/2025
12/2028
12/2027
12/2028
07/2028
01/2028
01/2028
12/2023
08/2027
10/2024
10/2025
10/2024
10/2024
10/2025
10/2025
10/2024
10/2024
10/2025
09/2024
09/2024
09/2024
10/2029
10/2028
04/2027
04/2027
09/2028
09/2028
09/2028
09/2028
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
11/2027
11/2027
06/2029
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
68
34
4,208
743
—
49,911
3,929
—
21,760
81
96
6,913
—
63
109
50
8,323
3,424
1,107
683
640
377
84
148
3,333
13,084
8,083
—
9,953
—
23,748
63
4,221
—
844
1,996
18,186
864
534
178
156
146
146
1,880
58
—
1,571
791
9,393
—
2,466
65
29
4,104
724
(1)
50,159
3,906
—
21,597
80
91
7,640
—
66
108
44
8,282
3,391
1,105
680
638
375
93
148
3,270
13,146
8,060
—
9,824
(1)
23,582
62
4,190
(1)
838
1,968
18,077
859
531
176
155
145
145
1,857
57
(1)
1,562
786
9,329
(3)
2,446
— % $
—
0.2
—
—
2.0
0.2
—
0.8
—
—
0.3
—
—
—
—
0.3
0.1
—
—
—
—
—
—
0.1
0.5
0.3
—
0.4
—
0.9
—
0.2
—
—
0.1
0.7
—
—
—
—
—
—
0.1
—
—
0.1
—
0.4
—
0.1
65
28
4,102
724
(1)
49,911
3,929
—
20,890
75
72
6,913
—
63
109
44
8,323
3,424
1,107
683
640
377
84
148
3,333
13,084
8,083
—
9,953
—
23,511
62
4,221
—
844
1,996
18,186
864
534
178
156
146
146
1,880
58
—
1,571
791
9,393
—
2,411
See Notes to Consolidated Financial Statements.
153
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Quant Buyer, Inc.+
Quant Buyer, Inc.+(5)
Quant Buyer, Inc.+
Quant Buyer, Inc.+(5)
Rainforest Bidco Limited+(8)(9)(10)(23)
Rainforest Bidco Limited+(8)(9)(10)(23)
Rainforest Bidco Limited+(8)(10)(23)
Rainforest Bidco Limited+(5)(8)(9)(10)
RegEd Aquireco, LLC+
RegEd Aquireco, LLC+
Riskonnect Parent, LLC*+
Riskonnect Parent, LLC+
Riskonnect Parent, LLC+(5)
Rodeo Buyer Company & Absorb Software Inc.+
Rodeo Buyer Company & Absorb Software Inc.+
SailPoint Technologies Holdings, Inc.+
SailPoint Technologies Holdings, Inc.+(5)
Sapphire Bidco Oy+(8)(9)(16)
Sapphire Bidco Oy+(8)(9)(16)
Sonatype, Inc.+
Sonatype, Inc.+
Sonatype, Inc.+(5)
Spartan Buyer Acquisition Co.*#+(23)
Spartan Buyer Acquisition Co.+(23)
Spartan Buyer Acquisition Co.+(5)(23)
Tahoe Bidco B.V. +(8)(14)
Tahoe Bidco B.V. +(5)(8)(14)
Telesoft Holdings LLC+
Telesoft Holdings LLC+
Telesoft Holdings LLC+
Templafy APS and Templafy, LLC+(8)(18)
Templafy APS and Templafy, LLC+(8)(18)
Templafy APS and Templafy, LLC+(5)(8)(18)
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+(5)
Togetherwork Holdings, LLC*#
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC#+
Togetherwork Holdings, LLC*#
Togetherwork Holdings, LLC#+
Togetherwork Holdings, LLC*+
Togetherwork Holdings, LLC#+
Togetherwork Holdings, LLC*#
Togetherwork Holdings, LLC#+
Interest
Rate
(2)
cash/
cash/
cash/
2.00%
2.00%
2.00%
PIK
PIK
PIK
cash/
cash/
cash/
2.00%
2.00%
2.00%
PIK
PIK
PIK
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
6.00% (m)
6.00%
6.00% (m)
6.50%
5.50% (i)
5.50% (i)
5.50% (j)
6.50%
4.25% (k)(m)
4.25% (l)(m)
5.50% (l)
5.50% (l)
5.50%
6.25% (k)
6.25% (k)
6.25% (k)
6.25%
5.75% (d)
5.75%
6.75% (k)
6.75% (k)
6.75%
8.50% (k)
8.50% (k)
7.50% (b)
6.00% (k)
6.00%
5.75% (k)
5.75% (k)
6.25% (k)
6.00% (m)
6.00%
6.00%
4.50% (a)
4.25% (a)
4.25% (a)(b)
4.50% (a)(m)
4.50% (a)
4.50%
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
SF +
SF +
SF +
SF +
SN +
SN +
SF +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
E +
SF +
SF +
SF +
SF +
SF +
P +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
11.30%
N/A(6)
11.30%
N/A(6)
8.69%
8.69%
8.80%
N/A(6)
9.86%
9.94%
11.04%
11.04%
N/A(6)
11.67%
11.67%
11.58%
N/A(6)
9.41%
N/A(6)
12.18%
12.18%
N/A(6)
11.82%
11.82%
14.00%
11.42%
N/A(6)
11.17%
11.17%
11.67%
11.68%
N/A(6)
N/A(6)
9.87%
9.62%
9.63%
9.91%
9.87%
N/A(6)
11.42%
11.42%
11.42%
11.42%
11.42%
11.42%
11.42%
11.42%
11.42%
11.42%
11.42%
$
Maturity
Date
06/2029
06/2029
06/2029
06/2029
07/2029
07/2029
07/2029
07/2029
12/2024
12/2024
12/2028
12/2028
12/2028
05/2027
05/2027
08/2029
08/2028
07/2029
07/2029
12/2025
12/2025
12/2025
12/2026
12/2026
12/2026
09/2028
10/2027
12/2025
12/2025
08/2028
07/2028
07/2028
07/2028
12/2024
12/2024
12/2024
12/2024
12/2024
12/2024
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
2,928
—
2,006
—
7,352
540
1,423
—
11,067
236
10,102
140
—
4,541
27
9,827
—
32,488
—
40,459
851
—
31,705
2,015
1
12,058
—
877
8
64
3,171
—
—
3,409
901
425
565
156
—
15,085
6,823
4,139
1,748
1,697
1,654
1,598
1,539
1,436
1,175
647
2,904
(1)
1,990
(74)
7,015
516
1,407
(64)
11,071
236
10,027
138
(5)
4,514
26
9,661
(1)
30,455
—
40,288
847
(1)
31,376
1,983
(1)
11,972
(1)
870
8
64
3,103
—
(14)
3,423
894
422
562
155
—
15,118
6,774
4,121
1,767
1,714
1,671
1,608
1,556
1,450
1,181
654
0.1 % $
—
0.1
—
0.3
—
0.1
—
0.4
—
0.4
—
—
0.2
—
0.4
—
1.3
—
1.6
—
—
1.2
0.1
—
0.5
—
—
—
—
0.1
—
—
0.1
—
—
—
—
—
0.6
0.3
0.2
0.1
0.1
0.1
0.1
0.1
0.1
—
—
2,862
(3)
1,961
—
7,022
516
1,356
(64)
10,514
224
9,900
133
(13)
4,541
27
9,729
(2)
32,488
—
40,459
851
—
30,754
1,955
(1)
11,696
(2)
864
7
64
3,171
—
—
3,341
883
416
554
153
(2)
15,085
6,823
4,139
1,748
1,697
1,654
1,598
1,539
1,436
1,175
647
See Notes to Consolidated Financial Statements.
154
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+(5)
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Vector CS Midco Limited & Cloudsense Ltd.+(8)(9)(10)(23)
Vector CS Midco Limited & Cloudsense Ltd.+(8)(9)(10)(23)
Vendavo, Inc.*#+
Vendavo, Inc.+
WebPT, Inc.+
Workforce Software, LLC+(23)
Workforce Software, LLC+(23)
Workforce Software, LLC+(23)
Workforce Software, LLC+(5)
Workforce Software, LLC+(23)
Zendesk, Inc.+(23)
Zendesk, Inc.+(5)
Zendesk, Inc.+(5)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
N/A
N/A
SF +
P +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00% (k)
6.00%
6.00% (k)
6.00% (k)
5.75% (l)
4.75% (b)
6.75% (l)
7.25% (l)
7.25% (l)
7.25% (l)
6.50%
7.25% (l)
6.75% (l)
6.50%
6.50%
11.42%
11.42%
11.42%
11.42%
11.42%
N/A(6)
11.42%
11.42%
4.50%
4.50%
11.25%
13.25%
12.27%
9.82%
9.82%
9.82%
N/A(6)
9.82%
8.90%
N/A(6)
N/A(6)
cash/
cash/
8.38%
8.38%
PIK
PIK
cash/
cash/
cash/
cash/
cash/
3.00%
3.00%
3.00%
3.00%
3.25%
PIK
PIK
PIK
PIK
PIK
$
Maturity
Date
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
05/2024
05/2024
09/2027
09/2027
01/2028
07/2025
07/2025
07/2025
07/2025
07/2025
11/2028
11/2028
11/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
448
434
250
62
57
—
1,326
5,954
8,587
140
19,413
85
626
29,044
5,140
3,640
—
107
20,311
—
—
446
432
249
63
58
(2)
1,318
5,880
8,980
150
19,300
84
619
29,280
5,119
3,605
(1)
106
19,969
(1)
(43)
— % $
—
—
—
—
—
0.1
0.2
0.3
—
0.7
—
—
1.1
0.2
0.1
—
—
0.8
—
—
448
434
250
62
57
—
1,326
5,954
7,986
130
18,442
78
620
28,754
5,088
3,604
(2)
106
20,311
—
—
1,365,871
1,356,325
52.9
1,347,754
See Notes to Consolidated Financial Statements.
155
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Specialty Retail
Ave Holdings III, Corp*+
Ave Holdings III, Corp+(5)
Ave Holdings III, Corp+
Ave Holdings III, Corp+
Consilio Midco Limited+(8)(10)
Consilio Midco Limited#(8)(10)
Consilio Midco Limited+(8)(9)(10)
Consilio Midco Limited#(8)(10)
Consilio Midco Limited#(8)(10)
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(5)(8)(9)(10)
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(8)(9)(10)
Consilio Midco Limited+(8)(9)(10)
Consilio Midco Limited+(8)(9)(10)
Consilio Midco Limited+(8)(9)(10)
Consilio Midco Limited+(8)(9)(10)
Cycle Gear, Inc.*#+
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+(23)
Imperial Optical Midco Inc.+
PPV Intermediate Holdings, LLC#+
PPV Intermediate Holdings, LLC+(23)
PPV Intermediate Holdings, LLC+(5)
PPV Intermediate Holdings, LLC+(23)
PPV Intermediate Holdings, LLC+(23)
PPV Intermediate Holdings, LLC+(23)
PPV Intermediate Holdings, LLC+(23)
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+(5)
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SF +
SF +
SF +
E +
SF +
E +
E +
E +
E +
E +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
N/A
SF +
N/A
N/A
N/A
N/A
SF +
SF +
SF +
SF +
SF +
(l)
(l)
(l)
(l)
(l)
(d)
(l)
(l)
(l)
(l)
(l)
(d)
(d)
(d)
(d)
(d)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
5.50%
5.50%
5.50%
5.50%
5.75%
5.75%
6.25%
5.75%
5.75%
5.75%
5.75%
6.25%
5.75%
6.25%
6.25%
6.25%
6.25%
6.25%
5.50%
8.75%
8.75%
8.75%
8.75%
13.00%
8.75%
8.75%
8.75%
8.75%
8.75%
8.75%
8.75%
8.75%
8.75%
13.00%
5.75%
5.75%
6.25%
6.25%
6.25%
6.25%
6.25%
(m)
(m)
(l)
(m)
11.04%
N/A(6)
11.04%
11.04%
11.29%
11.29%
10.20%
11.29%
11.29%
11.29%
11.29%
N/A(6)
11.29%
10.20%
10.20%
10.20%
10.20%
10.20%
11.04%
6.52%
6.52%
6.52%
6.52%
8.02%
6.52%
6.52%
6.52%
6.52%
6.52%
6.52%
6.52%
6.52%
6.52%
N/A(6)
11.17%
13.50%
N/A(6)
13.50%
13.50%
13.50%
14.25%
11.59%
11.60%
N/A(6)
11.64%
11.59%
7.75%
7.75%
7.75%
7.75%
10.50%
7.75%
7.75%
7.75%
7.75%
7.75%
7.75%
7.75%
7.75%
7.75%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
PIK
PIK
PIK
PIK
PIK
Maturity
Date
02/2028
02/2028
02/2028
02/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
01/2026
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
05/2024
08/2029
08/2030
08/2029
08/2030
08/2030
08/2030
08/2030
08/2028
08/2028
08/2028
08/2028
08/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
25,635
$
25,256
1.0
% $
24,866
—
57
460
11,421
9,875
8,908
2,136
1,421
726
100
—
8
7
64
15
28
17
46,953
21,847
3,796
2,889
3,156
3,851
5,593
37,604
5,079
134
79
2,539
42
524
1,256
—
9,613
1,046
—
44
242
44
2,743
3,540
75
—
58
231
(2)
49
456
11,268
9,799
9,416
2,108
1,409
712
99
(2)
8
7
64
15
28
18
46,848
21,796
3,786
2,950
3,149
3,796
5,699
37,739
5,067
133
79
2,533
41
523
1,253
—
9,470
1,026
(7)
40
239
44
2,663
3,511
73
(8)
57
229
—
—
—
0.5
0.4
0.3
0.1
0.1
—
—
—
—
—
—
—
—
—
1.7
0.8
0.2
0.1
0.1
0.2
0.2
1.4
0.2
—
—
0.1
—
—
0.1
—
0.4
—
—
—
—
—
0.1
0.2
—
—
—
—
(4)
36
446
11,307
9,776
8,819
2,115
1,406
719
99
(1)
8
7
64
15
28
17
44,135
20,827
3,618
2,754
3,009
3,845
5,332
35,849
4,842
128
76
2,420
40
500
1,198
231
9,469
983
(6)
41
227
42
2,660
3,505
73
(10)
57
229
See Notes to Consolidated Financial Statements.
156
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+(5)
SureWerx Purchaser III, Inc.+(8)
SureWerx Purchaser III, Inc.+(8)
SureWerx Purchaser III, Inc.+(5)(8)
Titan Fitness, LLC*#+(23)
Titan Fitness, LLC+(23)
Titan Fitness, LLC+(23)
Vermont Aus Pty Ltd+(8)(11)
Vermont Aus Pty Ltd+(8)(9)(11)
VSG Acquisition Corp. and Sherrill, Inc.+
VSG Acquisition Corp. and Sherrill, Inc.+
VSG Acquisition Corp. and Sherrill, Inc.+
Investment Type
Senior secured
Senior secured
Second lien
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
Interest
Rate
(2)
SF + 6.25%
SF + 6.25%
SF + 9.00%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.75%
SF + 6.75%
SF + 6.75%
SF + 6.75%
6.75%
L +
L +
6.75%
SF + 5.50%
5.75%
A +
SF + 5.50%
SF + 5.50%
SF + 5.50%
(l)
(l)
(m)
(m)
(m)
(l)
(k)(l)
(k)(l)(m)
(a)
(a)
(l)
(f)
(m)
(b)(l)
(m)
11.64%
11.64%
14.45%
11.68%
11.63%
N/A(6)
12.14%
12.07%
N/A(6)
10.45%
10.00%
10.00%
11.04%
9.94%
11.40%
11.34%
11.31%
cash/
cash/
cash/
2.00%
2.00%
2.00%
PIK
PIK
PIK
Maturity
Date
08/2028
08/2028
09/2029
08/2028
08/2028
08/2028
12/2029
12/2028
12/2029
02/2025
02/2025
02/2025
03/2028
03/2028
04/2028
04/2028
04/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
183
76
902
239
54
—
20,594
29
—
31,131
1,939
500
8,258
7,244
8,225
10
106
182
76
830
237
53
(6)
20,134
28
(57)
31,236
1,932
499
8,165
8,312
8,132
9
102
— % $
—
—
—
—
—
0.8
—
—
1.1
0.1
—
0.3
0.3
0.3
—
—
181
76
848
236
53
(6)
20,594
29
—
28,639
1,784
458
8,258
7,244
7,896
6
101
293,346
293,301
11.1
282,194
See Notes to Consolidated Financial Statements.
157
TABLE OF CONTENTS
Technology Hardware, Storage & Peripherals
Agility Recovery Solutions Inc.+(23)
Agility Recovery Solutions Inc.+(23)
Textiles, Apparel & Luxury Goods
Dollfus Mieg Company, Inc.+(8)(10)
Dollfus Mieg Company, Inc.+(8)(10)
Dollfus Mieg Company, Inc.+(8)(10)
Dollfus Mieg Company, Inc.+(8)(9)(10)
Elite Sportswear, L.P.+(23)
Elite Sportswear, L.P.+(23)
Elite Sportswear, L.P.+(23)
Elite Sportswear, L.P.+(23)
Elite Sportswear, L.P.*+(23)
Elite Sportswear, L.P.+(23)
Elite Sportswear, L.P.*+(23)
Elite Sportswear, L.P.+(23)
Georgica Pine Clothiers, LLC+
Georgica Pine Clothiers, LLC+
Georgica Pine Clothiers, LLC+
Georgica Pine Clothiers, LLC+
Georgica Pine Clothiers, LLC+
Georgica Pine Clothiers, LLC+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
Trading Companies and Distributors
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+(5)
Water Utilities
S.J. Electro Systems, LLC+
S.J. Electro Systems, LLC+
S.J. Electro Systems, LLC+
Vessco Midco Holdings, LLC+
Vessco Midco Holdings, LLC+(5)
Vessco Midco Holdings, LLC+
Vessco Midco Holdings, LLC+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
SF + 6.75%
P +
5.50%
(l)
(b)(l)
11.54%
12.47%
cash/
cash/
0.75%
0.75%
PIK
PIK
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
1.50%
1.50%
1.50%
1.50%
1.50%
1.50%
1.50%
1.50%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
L +
L +
6.00%
6.00%
6.00%
L +
E +
6.00%
SF + 7.75%
SF + 7.75%
SF + 7.75%
SF + 7.75%
SF + 7.75%
SF + 7.75%
SF + 7.75%
SF + 7.75%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.25%
SF + 5.23%
SF + 5.00%
SF + 4.00%
SF + 4.00%
SF + 5.23%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.50%
SF + 6.50%
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 4.50%
SF + 4.00%
SF + 4.50%
SF + 4.50%
(a)
(a)
(a)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(a)(m)
(k)
11.90%
11.90%
11.90%
N/A(6)
11.90%
11.90%
11.90%
11.90%
11.90%
11.90%
11.90%
11.90%
11.04%
11.04%
11.04%
11.04%
11.04%
11.04%
10.88%
10.86%
10.61%
9.63%
9.65%
10.83%
11.79%
11.79%
11.81%
11.79%
12.04%
N/A(6)
10.27%
10.27%
10.27%
10.04%
N/A(6)
9.92%
N/A(6)
Maturity
Date
12/2024
12/2024
03/2028
03/2028
03/2028
03/2028
09/2025
09/2025
09/2025
09/2025
09/2025
09/2025
09/2025
09/2025
11/2023
11/2023
11/2023
11/2023
11/2023
11/2023
04/2024
04/2024
04/2024
04/2024
04/2024
04/2024
06/2028
06/2028
06/2028
06/2028
06/2028
06/2028
06/2027
06/2027
06/2027
11/2026
11/2026
11/2026
10/2026
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
22,200
$
742
22,942
22,200
742
22,942
1,954
974
855
—
9,976
4,009
2,063
113
684
314
300
4
9,512
6,440
997
895
628
2
3,918
56
84
50
—
—
1,936
965
848
—
9,898
3,978
2,047
105
680
311
297
4
9,504
6,434
996
895
628
2
3,920
56
84
50
—
—
43,828
43,638
18,924
15,093
451
453
4,113
—
39,034
16,836
58
79
2,101
—
206
—
18,668
14,871
444
447
4,009
(36)
38,403
16,732
57
79
2,082
(6)
204
—
0.9
—
0.9
0.1
—
—
—
0.4
0.2
0.1
—
—
—
—
—
0.4
0.3
—
—
—
—
0.2
—
—
—
—
—
1.7
0.7
0.6
—
—
0.2
—
1.5
0.6
—
—
0.1
—
—
—
% $
22,375
752
23,127
1,856
925
813
—
9,577
3,848
1,981
70
657
301
288
2
9,538
6,458
999
898
630
2
3,644
52
78
50
—
—
42,667
17,789
14,187
424
426
3,908
—
36,734
15,995
51
75
2,101
—
206
—
Total non-controlled/non-affiliate company debt investments
19,280
5,236,123
19,148
5,214,755
0.7
201.4
18,428
5,132,167
See Notes to Consolidated Financial Statements.
158
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Equity investments
(19)(20)
Aerospace and Defense
PPW Aero Buyer, Inc.+
Tronair Parent, Inc.+
Auto Components
Polk Acquisition Corp.+
Automobiles
CG Group Holdings, LLC+
Go Car Wash Parent, Corp.+(21)
Go Car Wash Parent, Corp.+
MOP GM Holding, LLC+
National Express Wash Parent Holdco, LLC+
POY Holdings, LLC+
Quick Quack Car Wash Holdings, LLC
Biotechnology
LP units
LLC units
N/A
N/A
LP interest
N/A
LP units
Preferred stock
Common stock
LP units
LP units
LLC units
LLC interest
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Cobepa BlueSky Aggregator, SCSp+
LP interest
N/A
Building Products
BECO Holding Company, Inc.+(21)
BECO Holding Company, Inc.+
Chemicals
Inhance Technologies Holdings LLC+
Inhance Technologies Holdings LLC+
Commercial Services & Supplies
CI (Quercus) Intermediate Holdings, LLC+
EGD Security Systems, LLC +
Franchise Brands plc+(8)(9)(10)(22)
North Haven Stack Buyer, LLC
PT Intermediate Holdings III, LLC+(21)
Radwell Parent, LLC+(21)
Containers and Packaging
Chase Intermediate+
Preferred stock
LP interest
Preferred stock
LLC units
LP interest
Common stock
Common stock
LLC units
LLC units
LP units
LP units
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
17.00%
N/A
N/A
N/A
N/A
N/A
N/A
Non-Cash
11.75%
N/A
Non-Cash
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
66
—
5
1
—
—
—
1
141
—
177
10
2
2
—
540
855
51
359
8
2
49
664
40
704
314
730
88
50
330
61
141
508
1,908
1,769
1,086
196
1,282
1,960
124
2,084
540
578
113
360
767
233
2,591
25
— % $
—
—
—
—
—
—
—
—
—
0.1
0.1
0.1
0.1
—
0.1
0.1
—
0.1
—
0.1
—
—
—
—
0.1
—
694
38
732
—
487
92
40
357
70
354
728
2,128
1,315
1,163
201
1,364
1,785
40
1,825
625
1,224
100
515
898
293
3,655
56
See Notes to Consolidated Financial Statements.
159
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Diversified Consumer Services
CHHJ Midco, LLC+(21)
DP Flores Holdings, LLC+
EMS LINQ, LLC+
EWC Growth Partners LLC+
HS Spa Holdings, Inc.+
Liminex, Inc.+
NSG Buyer, Inc. +(8)
PADI Holdco, Inc.+
Electronic Equipment, Instruments & Components
Inventus Power, Inc.+
Inventus Power, Inc.+
Inventus Power, Inc.+
Inventus Power, Inc.+
Investment Type
LLC units
LLC units
LP interest
LLC interest
Common stock
Common stock
LP units
LLC interest
Preferred stock
LLC units
LP interest
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
19
70
525
—
479
12
2
1
—
—
—
—
193
70
525
12
479
434
1,860
987
4,560
372
88
20
—
480
— % $
—
—
—
—
0.1
0.1
—
0.2
—
—
—
—
—
302
79
408
2
496
699
1,812
755
4,553
97
276
61
—
434
See Notes to Consolidated Financial Statements.
160
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Food & Staples Retailing
Benihana, Inc.+
Cafe Rio Holding, Inc.+
Hopdoddy Holdings, LLC+
Hopdoddy Holdings, LLC+
Mendocino Farms, LLC+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Food Products
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
C. J. Foods, Inc.+
Kodiak Cakes, LLC+
Louisiana Fish Fry Products, Ltd.+
Louisiana Fish Fry Products, Ltd.+
P&P Food Safety Holdings, Inc.+
Purfoods, LLC+
Health Care Equipment & Supplies
Aspen Medical Products, LLC+
Blue River Pet Care, LLC+
CCSL Holdings, LLC+(8)
CMI Parent Inc.+
CMI Parent Inc.+
G & H Wire Company, Inc.+
Investment Type
LLC units
Common stock
LLC units
LLC units
Common stock
LLC interest
LLC interest
Preferred stock
LLC units
Common stock
Preferred stock
Preferred stock
Preferred stock
LP units
Preferred stock
Common stock
Common stock
Preferred stock
Common stock
LLC interest
LP interest
Common stock
LP interest
Common stock
Common stock
LLC interest
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
43
5
44
20
168
32
2
77
3
1
1
4
1
—
—
—
—
—
4
—
—
—
—
—
3
335
699
604
217
61
770
389
20
2,760
102
5
2
2
9
2
1
75
472
483
13
356
945
2,467
77
76
337
132
3
269
894
— % $
—
—
—
0.1
—
—
0.1
—
—
—
—
—
—
—
0.1
—
—
—
—
0.2
0.3
—
—
—
—
—
—
—
896
987
5
1
1,535
183
33
3,640
173
7
2
3
9
2
1
1,285
299
346
25
220
4,430
6,802
88
211
315
186
275
54
1,129
See Notes to Consolidated Financial Statements.
161
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Health Care Providers & Services
Active Day, Inc.+
Acuity Eyecare Holdings, LLC+(21)
Acuity Eyecare Holdings, LLC+
ADCS Clinics Intermediate Holdings, LLC+
ADCS Clinics Intermediate Holdings, LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
CRH Healthcare Purchaser, Inc.+
DCA Investment Holding, LLC(21)
DCA Investment Holding, LLC
Emerge Intermediate, Inc.+
Emerge Intermediate, Inc.+
Emerge Intermediate, Inc.+
Encore GC Acquisition, LLC+
Encore GC Acquisition, LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Krueger-Gilbert Health Physics, LLC+
Midwest Veterinary Partners, LLC+(21)
Midwest Veterinary Partners, LLC+
Midwest Veterinary Partners, LLC+(21)
MWD Management, LLC & MWD Services, Inc.+
NDX Parent, LLC+
NDX Parent, LLC+
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
Oliver Street Dermatology Holdings, LLC+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Radiology Partners, Inc.+
Radiology Partners, Inc.+
Sage Dental Management, LLC+
Sage Dental Management, LLC+
Suveto Buyer, LLC+
LLC interest
LLC interest
LLC units
Preferred stock
Common stock
LLC units
LP interest
Preferred stock
Common stock
LLC units
LLC units
LLC units
LLC interest
LLC units
Common stock
LLC units
Common stock
Preferred stock
Warrant
Preferred stock
LLC interest
Common stock
Preferred stock
Common stock
LLC interest
LLC interest
LLC interest
LLC units
LLC interest
LLC units
LLC units
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Non-Cash
Non-Cash
Non-Cash
N/A
N/A
N/A
N/A
N/A
N/A
N/A
8.00%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
12.00%
N/A
10.00%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
2
1,632
889
2
—
129
429
1,142
12
—
—
9
26
26
—
—
185
1
6
—
412
—
40
—
452
—
4
11
43
—
3
6
1,099
2,235
1,023
1,119
6
132
327
558
5
648
61
4
272
52
15
11
212
1,165
—
30
335
272
40
321
234
528
74
68
55
249
3
562
11,715
— % $
0.2
0.1
0.1
—
—
—
0.1
—
—
—
—
—
—
—
—
—
0.1
—
—
—
—
—
—
—
0.1
—
—
—
—
—
—
0.7
156
4,917
2,950
1,562
—
202
631
1,214
22
507
76
—
—
—
16
9
267
1,222
342
43
617
39
45
311
—
799
407
85
338
448
—
378
17,603
See Notes to Consolidated Financial Statements.
162
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Health Care Technology
Connexin Software, Inc.+
HSI Halo Acquisition, Inc.+(21)
HSI Halo Acquisition, Inc.+
Symplr Software, Inc.+(21)
Symplr Software, Inc.+(21)
Symplr Software, Inc.+(21)
Symplr Software, Inc.+(21)
Symplr Software, Inc.+
Symplr Software, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Hotels, Restaurants & Leisure
Freddy's Frozen Custard LLC+(21)
Harri US LLC+
Harri US LLC+
Harri US LLC+
LMP TR Holdings, LLC(21)
SSRG Holdings, LLC+
Tropical Smoothie Cafe Holdings, LLC+
Insurance
Accession Risk Management Group, Inc.+(21)
Majesco+(21)
Majesco+
Internet and Catalog Retail
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
IT Services
Appriss Health Intermediate Holdings, Inc+(21)
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Critical Start, Inc.+
Optimizely North America, Inc.+
Kentik Technologies, Inc.+
Netwrix Corporation+(21)
Investment Type
LLC interest
Preferred stock
LP interest
Preferred stock
Preferred stock
Preferred stock
Preferred stock
LLC units
Common stock
Warrant
Warrant
LLC interest
Preferred stock
LP interest
LLC units
Preferred stock
Warrant
LLC units
LP interest
LP interest
Preferred stock
Preferred stock
LP interest
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Warrant
Common stock
Common stock
Preferred stock
LLC units
Spread
Above
Index
(1)
N/A
N/A
N/A
N/A
SF + 10.50%
N/A
(l)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Interest
Rate
(2)
Non-Cash
Non-Cash
Non-Cash
Non-Cash
Non-Cash
N/A
10.00%
N/A
11.00%
15.74%
11.00%
11.00%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
13.25%
9.00%
N/A
Non-Cash
Non-Cash
N/A
N/A
N/A
N/A
11.00%
Non-Cash
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
154
$
—
—
12
2
2
1
—
177
169
53
348
1
206
83
71
24
712
6
5
3
—
69
17
10
1
7
2
587
154
35
202
225
75
192
5
193
303
5
13,373
3,391
1,635
1,002
161
—
871
162
2,824
8
23,928
188
658
455
106
712
61
246
2,426
2,667
316
—
2,983
17,025
10,219
1,104
7,034
35,382
2,272
462
423
291
159
225
807
1,103
10
— % $
—
—
0.5
0.2
0.1
0.1
—
—
—
—
0.1
—
1.0
—
—
—
—
0.1
—
0.1
0.2
0.1
—
—
0.1
0.8
0.5
—
0.3
1.6
0.1
0.2
0.1
—
0.1
—
—
—
—
222
435
130
13,369
4,605
1,774
1,037
173
801
681
179
3,113
12
26,531
369
609
512
162
2,437
86
1,074
5,249
2,619
398
203
3,220
19,463
11,682
1,218
7,225
39,588
2,285
4,260
1,117
256
1,361
269
683
1,103
16
See Notes to Consolidated Financial Statements.
163
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
PCS Intermediate II Holdings, LLC+
Red Dawn SEI Buyer, Inc.+
Saturn Borrower Inc.+
Leisure Products
Massage Envy, LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
Life Sciences Tools & Services
Celerion Buyer, Inc.+
Celerion Buyer, Inc.+
PAS Parent Inc.+
PAS Parent Inc.+
Reaction Biology Corporation+
Oil, Gas and Consumable Fuels
W3 Co.+
W3 Co.+
Paper and Forest Products
Messenger, LLC+
Messenger, LLC+
Pharmaceuticals
Amalthea Parent, Inc.+(8)(12)
Cobalt Buyer Sub, Inc.+(21)
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Investment Type
LLC interest
LP interest
LP units
LLC interest
LLC interest
LLC interest
LLC interest
LLC interest
LLC interest
LLC interest
LP units
LP units
LP interest
Preferred stock
LLC units
LLC interest
Preferred stock
LLC units
LLC units
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
LP interest
Preferred stock
Preferred stock
Common stock
N/A
SF + 10.00%
N/A
N/A
(l)
N/A
15.24%
N/A
N/A
Non-Cash
See Notes to Consolidated Financial Statements.
164
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
37
13
346
749
67
46
38
33
15
2
930
930
9
1
—
3
—
3
—
502
8
—
2
367
13
346
6,478
210
117
80
65
58
24
2
556
930
—
933
139
265
2,267
1,633
224
1,857
312
—
312
502
9,066
168
2
9,738
Percentage
of Net
Assets
— % $
—
—
0.5
0.1
—
—
—
—
—
—
0.1
0.1
—
—
—
—
0.1
0.1
—
0.1
—
—
—
—
0.4
—
—
0.4
Fair
Value
(4)
574
22
114
12,060
1,783
137
93
77
67
28
2
2,187
930
287
879
162
273
2,531
2,002
254
2,256
160
—
160
432
10,241
167
—
10,840
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Professional Services
Brandmuscle, Inc.+
Enboarder, Inc.+(8)(11)
Filevine, Inc.+
Filevine, Inc.+
Filevine, Inc.+
Net Health Acquisition Corp.+
Procure Acquireco, Inc.+
Real Estate Management & Development
Inhabit IQ Inc.+
SC Landco Parent, LLC+
Road & Rail
Internet Truckstop Group LLC+
Software
Anaplan, Inc.+
Aras Corporation+(21)
Aras Corporation+
Astute Holdings, Inc.+
Auvik Networks Inc.+(8)(12)
Auvik Networks Inc.+(8)(12)
Bayshore Intermediate #2, L.P.+
Calabrio, Inc.+
Calabrio, Inc.+
Cloudbees, Inc.+
Cloudbees, Inc.+
Cloudbees, Inc.+
Cynet Security Ltd.+(8)(15)
Denali Bidco Limited+(8)(10)
Diligent Corporation+(21)
Diligent Corporation+
FirstUp, Inc.+
GS Acquisitionco, Inc.+(21)
GS Acquisitionco, Inc.+(21)
GS Acquisitionco, Inc.+
GS Acquisitionco, Inc.+(21)
GTY Technology Holdings, Inc.+
Impartner, Inc.+
Kaseya Inc.+(21)
Kaseya Inc.+
MetricStream, Inc.+
Ministry Brands Holdings LLC+
mParticle, Inc.+
mParticle, Inc.+
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Investment Type
LLC interest
Preferred stock
Preferred stock
Warrant
Warrant
LP interest
LP interest
Common stock
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
LP interest
N/A
LP interest
Preferred stock
LP interest
LP interest
Preferred stock
Preferred stock
Common stock
LP interest
LP interest
Preferred stock
Warrant
Preferred stock
Preferred stock
LP interest
Preferred stock
Preferred stock
Common stock
Preferred stock
Preferred stock
LP interest
Preferred stock
LP units
Preferred stock
Preferred stock
LP interest
Warrant
LP interest
Preferred stock
Warrant
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
(l)
N/A
SF + 10.50%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
12.00%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
10.50%
N/A
N/A
11.00%
11.00%
N/A
15.88%
N/A
N/A
11.75%
N/A
N/A
N/A
N/A
N/A
Non-Cash
Non-Cash
Non-Cash
Non-Cash
Non-Cash
Non-Cash
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
—
56
221
33
90
13
—
62
2
408
385
1
306
—
26
3
4,095
1
96
149
131
71
145
258
17
415
221
26
2
1
—
48
28
2
100
168
438
162
75
216
573
1,402
49
90
1,509
486
4,325
434
274
708
447
385
1,155
306
304
256
29
4,095
769
0
1,663
247
466
508
335
18,782
912
541
28,686
1,727
170
49
48
226
1,877
100
263
439
1,060
16
— % $
—
0.1
—
—
0.1
—
0.2
0.1
—
0.1
—
—
0.1
—
—
—
—
0.2
—
—
0.1
0.1
—
—
—
0.8
0.1
—
1.1
0.1
0.1
—
—
—
0.1
—
—
—
—
—
233
573
1,598
171
92
1,636
611
4,914
1,023
254
1,277
484
547
1,238
409
731
316
36
3,596
711
0
1,665
986
688
612
335
19,404
2,024
317
28,365
1,660
1,044
49
62
215
1,912
110
163
386
911
286
See Notes to Consolidated Financial Statements.
165
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Onapsis, Inc., Virtual Forge GMBH and Onapsis GMBH+
Panzura, LLC+
PDI TA Holdings, Inc.+
Personify, Inc.+
Project Alpha Intermediate Holding, Inc.+(21)
Project Alpha Intermediate Holding, Inc.+
Pyramid Healthcare Acquisition Corp.+
QAD, Inc.+(21)
QAD, Inc.+
Onit, Inc.+(21)
Onit, Inc.+
RegEd Aquireco, LLC+
RegEd Aquireco, LLC+
RegEd Aquireco, LLC+
Riskonnect Parent, LLC+(21)
Riskonnect Parent, LLC+
Riskonnect Parent, LLC+(21)
SnapLogic, Inc.+
SnapLogic, Inc.+
Spartan Buyer Acquisition Co.+
Spartan Buyer Acquisition Co.+
Telesoft Holdings LLC+
Templafy APS and Templafy, LLC+(8)(18)
Workforce Software, LLC+
Workforce Software, LLC+
Zendesk, Inc.+
Investment Type
Warrant
LLC units
Preferred stock
LP interest
Preferred stock
Common stock
Common stock
Preferred stock
Common stock
Preferred stock
Warrant
LP interest
LP interest
Preferred stock
Preferred stock
LP interest
Preferred stock
Preferred stock
Warrant
Common stock
Preferred stock
LP interest
Warrant
Common stock
Common stock
LP units
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
(l)
SF + 10.50%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Non-Cash
Non-Cash
Non-Cash
Non-Cash
Non-Cash
N/A
N/A
N/A
N/A
9.00%
N/A
N/A
9.00%
N/A
15.00%
N/A
N/A
N/A
N/A
11.00%
N/A
15.92%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
4
1
92
716
—
202
184
—
15
—
—
—
3
—
18
857
—
278
106
1
—
6
—
—
—
45
9
4
2,846
942
999
329
184
227
0
46
6
331
21
20
20,254
859
378
695
75
623
38
6
62
973
36
454
95,831
— % $
—
0.1
0.1
0.1
—
—
—
—
—
—
—
—
—
0.8
—
—
0.1
—
—
—
—
—
—
—
—
4.0
20
4
3,224
1,779
1,515
396
315
251
20
50
7
58
0
21
19,444
1,125
394
1,349
345
328
44
5
45
668
41
629
100,855
See Notes to Consolidated Financial Statements.
166
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Specialty Retail
Ave Holdings III, Corp+(21)
Ave Holdings III, Corp+
Batteries Plus Holding Corporation+
Cycle Gear, Inc.+
Cycle Gear, Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Pet Holdings ULC+(8)(12)(21)
Salon Lofts Group, LLC+
Southern Veterinary Partners, LLC+(21)
Southern Veterinary Partners, LLC+(21)
Southern Veterinary Partners, LLC+
VSG Acquisition Corp. and Sherrill, Inc.+
Spread
Above
Index
(1)
Investment Type
Preferred stock
LP units
LP interest
LLC units
Preferred stock
Preferred stock
Preferred stock
Common stock
LP interest
LP units
Preferred stock
Preferred stock
LLC interest
LP units
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Technology Hardware, Storage & Peripherals
Agility Recovery Solutions Inc.+
LLC interest
N/A
Textiles, Apparel & Luxury Goods
Georgica Pine Clothiers, LLC+(21)
Georgica Pine Clothiers, LLC+
MakerSights, Inc.+
R.G. Barry Corporation+
LLC interest
Common stock
Preferred stock
Preferred stock
N/A
N/A
N/A
N/A
Total non-controlled/non-affiliate company equity investments
Total non-controlled/non-affiliate company investments
Interest
Rate
(2)
Non-Cash
Non-Cash
Non-Cash
11.50%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
12.00%
10.00%
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
9
1
10
2,002
50
—
—
—
677
—
5
—
148
—
9,639
1,129
1,287
481
50
122
46
—
450
87
5,629
751
188
37
19,896
97
604
20
—
40
—
239
—
218
161
618
0.4 % $
—
0.1
—
—
—
—
—
—
—
0.2
0.1
0.2
—
1.0
—
—
—
—
—
—
9,288
1,077
1,415
—
79
50
18
80
1,035
69
6,002
1,237
5,558
24
25,932
223
525
2
218
284
1,029
241,909
11.2
284,572
5,456,664
212.6
5,416,739
See Notes to Consolidated Financial Statements.
167
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Non-controlled/affiliate company investments
(25)
Debt investments
Beverages
Abita Brewing Co., L.L.C.+(23)
Abita Brewing Co., L.L.C.+(7)(23)
Abita Brewing Co., L.L.C.+
Energy, Equipment & Services
Benetech, Inc.+(7)(23)
Benetech, Inc.+(7)(23)
Food and Staples Retailing
Rubio's Restaurants, Inc.+(23)
Rubio's Restaurants, Inc.+(7)(23)
Rubio's Restaurants, Inc.+(23)
Healthcare Providers and Services
Bayside Opco, LLC+(23)
Bayside Opco, LLC+(7)(23)
Bayside Opco, LLC+(23)
Bayside Opco, LLC+(23)
Elite Dental Partners LLC+(7)(23)
Elite Dental Partners LLC+(7)(23)
Elite Dental Partners LLC+(23)
Opening Day Borrower 111 LLC+(7)(23)
Opening Day Borrower 111 LLC+(7)(23)
Opening Day Borrower 111 LLC+(5)(7)
Software
Switchfly LLC+(23)
Switchfly LLC+(23)
Switchfly LLC+(23)
Switchfly LLC+(5)
One stop
Second lien
One stop
SF + 8.00%
SF + 8.00%
SF + 8.00%
(m)
(m)
One stop
One stop
SF + 6.00%
SF + 6.00%
Senior secured
Senior secured
Senior secured
SF + 8.00%
SF + 14.00%
SF + 8.00%
One stop
Subordinated debt
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 7.25%
SF + 10.00%
SF + 7.25%
SF + 7.00%
SF + 5.25%
SF + 12.00%
SF + 5.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
N/A
N/A
N/A
L +
8.50%
(a)
(l)
(l)
(l)
(l)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
13.03%
13.37%
N/A(6)
11.54%
11.54%
13.55%
19.56%
13.42%
12.79%
15.54%
12.79%
6.54%
10.79%
17.54%
10.79%
11.79%
11.79%
N/A(6)
1.00%
1.00%
1.00%
14.05%
6.00%
PIK
cash/
PIK
PIK
PIK
PIK
PIK
PIK
$
04/2024
04/2024
04/2024
08/2024
08/2024
12/2024
12/2024
12/2024
06/2026
06/2026
06/2026
06/2026
09/2024
09/2024
09/2024
05/2027
05/2027
05/2027
10/2024
10/2024
10/2024
10/2024
$
6,410
4,229
—
10,639
4,138
1,147
5,285
13,600
1,630
930
16,160
12,108
4,322
4,283
350
12,988
5,950
1,400
13,492
5,156
—
60,049
6,593
550
42
2
7,187
6,397
3,725
—
10,122
3,623
982
4,605
13,494
1,553
923
15,970
12,005
3,328
4,064
350
12,337
5,483
1,400
12,217
4,783
—
55,967
6,590
550
42
2
7,184
0.2 % $
0.1
—
0.3
—
—
—
0.5
—
—
0.5
0.5
0.1
0.2
—
0.3
0.2
—
0.5
0.2
—
2.0
0.1
—
—
—
0.1
5,128
1,396
—
6,524
1,242
111
1,353
10,880
391
649
11,920
11,866
3,457
4,026
350
7,533
4,463
1,400
12,143
4,640
(163)
49,715
4,351
363
28
(28)
4,714
Total non-controlled/affiliate company debt investments
99,320
93,848
2.9
74,226
Equity investments
(19)(20)
Beverages
Abita Brewing Co., L.L.C.+
Food and Staples Retailing
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Warrant
N/A
Preferred stock
Common stock
Common stock
Common stock
Common stock
Common stock
Common stock
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
210 $
—
— % $
12
2,779
27,241
6,321
1,056
1,829
246
246
492
2,276
278
131
9
10
1
1
2
—
—
—
—
—
—
—
—
143
—
—
—
—
—
—
—
See Notes to Consolidated Financial Statements.
168
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Healthcare Providers and Services
Bayside Opco, LLC+
Elite Dental Partners LLC
Elite Dental Partners LLC
Elite Dental Partners LLC
Opening Day Borrower 111 LLC+
Software
Switchfly LLC+
Switchfly LLC+
Total non-controlled/affiliate company equity investments
Total non-controlled/affiliate company investments
Controlled affiliate company investments
(26)
Debt investments
IT Services
MMan Acquisition Co.+(7)(23)
MMan Acquisition Co.+(23)
MMan Acquisition Co.+(23)
MMan Acquisition Co.+(23)
MMan Acquisition Co.+(23)
Total controlled affiliate company debt investments
Total controlled affiliate company investments
Total investments
Investment Type
Common stock
Common stock
Common stock
LLC units
LLC interest
LLC interest
LLC units
LLC units
LLC interest
LLC units
One stop
One stop
One stop
One stop
One stop
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
568
543
1,490
6
—
—
—
163
98,370
950
10.00%
8.00%
12.00%
12.00%
12.00%
PIK
PIK
PIK
PIK
PIK
$
08/2024
08/2024
08/2024
08/2024
08/2024
33,449
1,716
952
275
953
37,345
2
2
5
2,717
2,592
2,902
1,250
—
7,238
13,982
2,321
950
3,271
19,970
113,818
19,458
1,716
952
275
953
23,354
23,354
— % $
—
—
—
0.1
—
—
—
0.3
0.4
0.1
—
0.1
0.5
3.4
0.4
0.1
—
—
—
0.5
0.5
% $
—
—
—
143
2,345
—
—
—
7,818
10,163
2,088
452
2,540
12,858
87,084
9,031
1,579
952
275
953
12,790
12,790
5,593,836
216.5
5,516,613
28,774
6,670
37,378
72,822
1.1 % $
0.3
1.5
2.9
28,774
6,670
37,378
72,822
$
$
$
5,666,658
219.4 % $
5,589,435
Money market funds (included in cash and cash equivalents and restricted cash and cash equivalents)
BlackRock Liquidity Funds T-Fund Institutional Shares (CUSIP 09248U718)
Allspring Treasury Plus Money Market Fund (CUSIP 94975H296)
Morgan Stanley Institutional Liquidity Funds Treasury Securities Portfolio (CUSIP 61747C525)
5.23%
5.22%
5.21%
(27)
(27)
(27)
Total money market funds
Total investments and money market funds
See Notes to Consolidated Financial Statements.
169
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
*
#
+
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
Denotes that all or a portion of the loan secures the notes offered in the 2018 Debt Securitization (as defined in Note 7).
Denotes that all or a portion of the loan secures the notes offered in the GCIC 2018 Debt Securitization (as defined in Note 7).
Denotes that all or a portion of the investment collateralizes the JPM Credit Facility (as defined in Note 7).
The majority of the investments bear interest at a rate that is permitted to be determined by reference to the Secured Overnight Financing Rate (“SOFR” or “SF”), Euro Interbank Offered Rate (“EURIBOR” or “E”), Prime (“P”), Sterling Overnight Index Average
("SONIA" or “SN”), Australian Interbank Rate (”AUD” or ”A”), Canadian Bankers Acceptance Rate (”CDOR” or "C”) or London Interbank Offered Rate (“LIBOR” or “L”) denominated in U.S. dollars which reset daily, monthly, quarterly, semiannually, or annually. For
each, the Company has provided the spread over the applicable index and the weighted average current interest rate in effect as of September 30, 2023. Certain investments are subject to an interest rate floor. For fixed rate loans, a spread above a reference
rate is not applicable. For positions with multiple outstanding contracts, the spread for the largest outstanding contract is shown. Listed below are the index rates as of September 30, 2023, which was the last business day of the period on which the applicable
index rates were determined. The actual index rate for each loan listed may not be the applicable index rate outstanding as of September 30, 2023, as the loan may have priced or repriced based on an index rate prior to September 30, 2023.
(a)
Denotes that all or a portion of the contract was indexed to the 180-day LIBOR, which was last quoted on June 30, 2023 at 5.76%.
(b)
Denotes that all or a portion of the contract was indexed to the Prime rate, which was 8.50% as of September 30, 2023.
(c)
(d)
(e)
Denotes that all or a portion of the contract was indexed to the 30-day EURIBOR, which was 3.85% as of September 30, 2023.
Denotes that all or a portion of the contract was indexed to the 90-day EURIBOR, which was 3.95% as of September 30, 2023.
Denotes that all or a portion of the contract was indexed to the 180-day EURIBOR, which was 4.13% as of September 30, 2023.
(f)
Denotes that all or a portion of the contract was indexed to the Three-Month AUD, which was 4.14% as of September 30, 2023.
(g)
(h)
Denotes that all or a portion of the contract was indexed to the 60-day CDOR, which was 5.45% as of September 30, 2023.
Denotes that all or a portion of the contract was indexed to the 90-day CDOR, which was 5.51% as of September 30, 2023.
(i)
(j)
Denotes that all or a portion of the contract was indexed to SONIA, which was 5.19% as of September 30, 2023.
Denotes that all or a portion of the contract was indexed to Daily SOFR, which was 5.31% as of September 30, 2023.
(k)
Denotes that all or a portion of the contract was indexed to the 30-day Term SOFR which was 5.32% as of September 30, 2023.
(l)
Denotes that all or a portion of the contract was indexed to the 90-day Term SOFR which was 5.40% as of September 30, 2023.
(m)
Denotes that all or a portion of the contract was indexed to the 180-day Term SOFR which was 5.47% as of September 30, 2023.
For positions with multiple interest rate contracts, the interest rate shown is a weighted average current interest rate in effect as of September 30, 2023.
The total principal amount is presented for debt investments while the number of shares or units owned is presented for equity investments.
The fair values of investments were valued using significant unobservable inputs, unless noted otherwise. See “Note 6. Fair Value Measurements”.
The negative fair value is the result of the capitalized discount on the loan or the unfunded commitment being valued below par. The negative amortized cost is the result of the capitalized discount being greater than the principal amount outstanding on the loan.
The entire commitment was unfunded as of September 30, 2023. As such, no interest is being earned on this investment. The investment may be subject to an unused facility fee.
Loan was on non-accrual status as of September 30, 2023, meaning that the Company has ceased recognizing interest income on the loan.
The investment is treated as a non-qualifying asset under Section 55(a) of the Investment Company Act of 1940, as amended (the “1940 Act”). Under the 1940 Act, the Company cannot acquire any non-qualifying asset unless, at the time the acquisition is made,
qualifying assets represent at least 70% of the Company's total assets. As of September 30, 2023, total non-qualifying assets at fair value represented 15.2% of the Company's total assets calculated in accordance with the 1940 Act.
Investment is denominated in foreign currency and is translated into U.S. dollars as of the valuation date or the date of the transaction. See “Note 2. Significant Accounting Policies and Recent Accounting Updates - Foreign Currency Translation”.
The headquarters of this portfolio company is located in the United Kingdom.
The headquarters of this portfolio company is located in Australia.
The headquarters of this portfolio company is located in Canada.
The headquarters of this portfolio company is located in Luxembourg.
(14)
The headquarters of this portfolio company is located in Netherlands.
(15)
(16)
(17)
(18)
(19)
(20)
The headquarters of this portfolio company is located in Israel.
The headquarters of this portfolio company is located in Finland.
The headquarters of this portfolio company is located in Sweden.
The headquarters of this portfolio company is located in Denmark.
Equity investments are non-income producing securities unless otherwise noted.
Ownership of certain equity investments occurs through a holding company or partnership.
See Notes to Consolidated Financial Statements.
170
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2023
(Dollar and share amounts in thousands)
(21)
The Company holds an equity investment that is income producing.
(22)
The fair value of this investment was valued using Level 1 inputs. See “Note 6. Fair Value Measurements”.
(23)
(24)
(25)
All or a portion of the loan interest was capitalized into the outstanding principal balance of the loan in accordance with the terms of the credit agreement during the year ended September 30, 2023.
The fair value of the loan reflects the legal claim on par and accrued uncapitalized payment-in-kind (“PIK”) interest.
As defined in the 1940 Act, the Company is deemed to be an “affiliated person” of the portfolio company as the Company owns five percent or more of the portfolio company's voting securities (“non-controlled affiliate”). Transactions related to investments in non-
controlled affiliates for the year ended September 30, 2023 were as follows:
Portfolio Company
Abita Brewing Co. LLC
Bayside Opco, LLC
Benetech, Inc.
Elite Dental Partners LLC
Opening Day Borrower 111 LLC
Rubio's Restaurants, Inc.
Sloan Company, Inc.
Switchfly LLC
Total Non-Controlled Affiliates
Fair value as of
September 30, 2022
Gross Additions
(a)
Gross Reductions
(b)
Net change in unrealized
appreciation
(depreciation)
Net realized gain (loss)
Fair value as of
September 30, 2023
Interest, dividend and fee
income
$
$
8,071 $
—
1,740
20,689
—
13,174
6,318
7,697
57,689 $
1,334 $
22,958
618
4,308
25,387
4,943
38
209
(728) $
(619)
(710)
(1,147)
(1,149)
(1,460)
(6,329)
—
(2,141) $
(295)
(295)
(10,454)
200
(4,594)
(347)
(652)
59,795 $
(12,142) $
(18,578) $
— $
—
—
—
—
—
320
—
320 $
6,536 $
22,044
1,353
13,396
24,438
12,063
—
7,254
87,084 $
805
749
9
1,005
—
1,922
344
142
4,976
(a)
(b)
Gross additions may include increases in the cost basis of investments resulting from new investments, amounts related to PIK interest capitalized and added to the principal balance of the respective loans, the accretion of discounts, the
exchange of one or more existing investments for one or more new investments and the movement of an existing portfolio company into this affiliated category from a different category.
Gross reductions may include decreases in the cost basis of investments resulting from principal collections related to investment repayments and sales, the amortization of premiums, the reversal of capitalized PIK for non-accrual positions and
the exchange of one or more existing securities for one or more new securities.
(26)
As defined in the 1940 Act, the Company is deemed to be both an “affiliated person” of and “control” this portfolio company as the Company owns more than 25% of the portfolio company's outstanding voting securities or has the power to exercise control over
management or policies of such portfolio company (including through a management agreement) (“controlled affiliate”). Transactions related to investments in controlled affiliates for the year ended September 30, 2023 were as follows:
Portfolio Company
MMan Acquisition Co.
Total Controlled Affiliates
Fair value as of
September 30, 2022
$
$
14,073 $
14,073 $
Gross Additions
(a)
Gross Reductions
(b)
Net change in unrealized
appreciation
(depreciation)
Net realized gain (loss)
Fair value as of
September 30, 2023
Interest, dividend and fee
income
3,527 $
3,527 $
(3,264) $
(3,264) $
(619) $
(619) $
(927) $
(927) $
12,790 $
12,790 $
307
307
(a)
(b)
Gross additions may include increases in the cost basis of investments resulting from new investments, amounts related to PIK interest capitalized and added to the principal balance of the respective loans, the accretion of discounts, the exchange of
one or more existing investments for one or more new investments and the movement of an existing portfolio company into this affiliated category from a different category.
Gross reductions may include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the amortization of premiums, the reversal of capitalized PIK for non-accrual positions and the
exchange of one or more existing securities for one or more new securities.
(27)
The rate shown is the annualized seven-day yield as of September 30, 2023.
See Notes to Consolidated Financial Statements.
171
TABLE OF CONTENTS
Investments
Non-controlled/non-affiliate company investments
Debt investments
Aerospace and Defense
Tronair Parent, Inc.+
Tronair Parent, Inc.+
Whitcraft LLC*#+
Whitcraft LLC+
Airlines
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Senior secured
Senior secured
One stop
One stop
L +
L +
L +
P +
6.25%
6.25%
6.00%
5.00%
(b)
(b)
(b)
(d)
8.67%
8.67%
9.67%
11.25%
cash/
cash/
0.50%
0.50%
PIK
PIK
$
09/2023
06/2023
04/2023
04/2023
$
672
100
62,608
42
63,422
670
99
62,693
38
63,500
Aurora Lux Finco S.A.R.L. +(8)(13)
One stop
L +
6.00%
(b)
8.78%
12/2026
975
961
Auto Components
COP CollisionRight Holdings, Inc.#+
COP CollisionRight Holdings, Inc.+
COP CollisionRight Holdings, Inc.+(5)
Covercraft Parent III, Inc.+
Covercraft Parent III, Inc.+
Covercraft Parent III, Inc.+(5)
North Haven Falcon Buyer, LLC+
North Haven Falcon Buyer, LLC+
Polk Acquisition Corp.*#+
Polk Acquisition Corp.+
Polk Acquisition Corp.+
Polk Acquisition Corp.+
Automobiles
CG Group Holdings, LLC*#+
CG Group Holdings, LLC+
Denali Midco 2, LLC*#+
Denali Midco 2, LLC+(5)
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+
Denali Midco 2, LLC+(5)
JHCC Holdings LLC+
JHCC Holdings LLC+
JHCC Holdings LLC+
JHCC Holdings LLC+
JHCC Holdings LLC+
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 4.75%
SF + 4.75%
SF + 4.75%
L +
4.50%
L +
4.50%
L +
4.50%
L +
6.50%
6.50%
L +
SF + 6.00%
SF + 6.50%
SF + 6.00%
SF + 6.00%
L +
7.25%
7.25%
L +
SF + 6.25%
SF + 5.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.50%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.50%
5.75%
L +
4.75%
P +
L +
P +
L +
5.75%
4.75%
5.75%
(l)
(l)
(b)
(b)
(c)
(c)
(k)
(k)
(k)
(k)
(b)
(a)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(b)
(d)
(b)(d)
(b)(d)
(b)
7.26%
8.45%
N/A(6)
6.78%
8.17%
N/A(6)
8.51%
8.67%
9.03%
9.53%
9.03%
9.03%
8.92%
8.37%
9.38%
N/A(6)
9.38%
9.38%
9.38%
9.38%
9.28%
9.45%
9.38%
9.38%
9.38%
9.38%
N/A(6)
9.42%
11.00%
9.91%
10.30%
9.42%
cash/
cash/
2.00%
2.00%
PIK
PIK
04/2028
04/2028
04/2028
08/2027
08/2027
08/2027
05/2027
05/2027
12/2024
03/2023
12/2024
12/2024
07/2027
07/2026
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
12/2027
09/2025
09/2025
09/2025
09/2025
09/2025
See Notes to Consolidated Financial Statements.
172
% $
—
—
2.4
—
2.4
—
0.4
—
—
0.2
—
—
0.3
—
0.7
—
—
—
618
88
60,729
33
61,468
926
9,542
26
(3)
4,890
994
—
5,855
981
17,777
695
104
105
40,966
28,925
311
41,579
(15)
192
97
77
77
64
949
640
116
111
80
(29)
14,855
481
286
54
269
9,638
27
—
4,890
994
—
6,099
1,021
18,007
695
106
106
9,483
26
(2)
4,850
973
(1)
6,004
1,006
17,927
693
108
106
41,583
41,173
1.6
31,441
338
42,864
—
198
100
80
80
66
978
660
120
114
82
—
15,314
496
295
57
302
31,084
334
42,490
(4)
196
99
79
79
65
949
654
119
113
81
(29)
15,116
491
292
56
267
1.1
—
1.7
—
—
—
—
—
—
—
—
—
—
—
—
0.6
—
—
—
—
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
MOP GM Holding, LLC*#+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+
MOP GM Holding, LLC+(5)
MOP GM Holding, LLC+
MOP GM Holding, LLC+
POY Holdings, LLC#
POY Holdings, LLC+
POY Holdings, LLC+
National Express Wash Parent Holdco, LLC+
National Express Wash Parent Holdco, LLC+
National Express Wash Parent Holdco, LLC+(5)
Quick Quack Car Wash Holdings, LLC*#
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC#+
Quick Quack Car Wash Holdings, LLC*+
Quick Quack Car Wash Holdings, LLC*+
Quick Quack Car Wash Holdings, LLC*+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Quick Quack Car Wash Holdings, LLC+
Spotless Brands, LLC+
Spotless Brands, LLC+
Spotless Brands, LLC+
Spotless Brands, LLC+(5)
TWAS Holdings, LLC#+
TWAS Holdings, LLC*+
TWAS Holdings, LLC+
TWAS Holdings, LLC+
TWAS Holdings, LLC+
TWAS Holdings, LLC+(5)
Beverages
Fintech Midco, LLC*#
Fintech Midco, LLC+
Fintech Midco, LLC#+
Fintech Midco, LLC+(5)
Watermill Express, LLC+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 5.75%
L +
5.75%
SF + 5.75%
L +
5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
5.50%
L +
5.50%
L +
L +
5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
6.50%
L +
L +
L +
L +
L +
L +
L +
6.50%
6.50%
6.50%
6.50%
6.50%
6.50%
6.50%
L +
6.50%
L +
6.50%
L +
L +
6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.50%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
L +
L +
L +
L +
L +
5.25%
5.25%
5.25%
5.25%
5.50%
(m)
(c)
(m)
(c)
(l)
(m)
(m)
(m)
(m)
(l)
(m)
(c)(l)(m)
(l)
(m)
(b)
(b)
(b)
(m)
(m)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(a)(b)
(a)
(a)(b)
(l)
(k)
(d)(k)
(k)
(k)
(k)
(k)
(k)
(b)
(b)
(b)
(b)
9.98%
7.09%
7.62%
6.95%
8.58%
8.98%
7.62%
9.98%
9.50%
9.55%
8.51%
8.91%
N/A(6)
8.99%
8.94%
9.17%
9.17%
9.14%
8.27%
8.39%
N/A(6)
9.31%
9.31%
9.31%
9.31%
9.31%
9.31%
9.31%
9.32%
9.51%
9.62%
9.50%
9.19%
9.44%
9.92%
N/A(6)
9.38%
9.38%
9.38%
9.38%
9.38%
N/A(6)
8.06%
8.06%
8.06%
N/A(6)
9.17%
$
Maturity
Date
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2026
11/2027
11/2027
11/2027
07/2029
07/2029
07/2029
10/2024
10/2024
10/2024
10/2024
10/2024
10/2024
10/2024
10/2024
10/2024
10/2024
10/2024
07/2028
07/2028
07/2028
07/2028
12/2026
12/2026
12/2026
12/2026
12/2026
12/2026
08/2024
08/2024
08/2024
08/2024
04/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
23,977
2,629
2,599
2,578
1,910
1,571
1,448
527
358
148
60
86
—
180
60
9,543
36
82
3,150
70
—
12,815
9,773
2,313
2,020
1,350
1,099
95
120
95
345
104
8,369
428
20
—
40,460
30,566
7,934
609
387
—
23,768
2,609
2,562
2,556
1,894
1,559
1,424
523
355
146
59
84
(21)
178
59
9,379
32
79
3,120
68
(22)
12,820
9,750
2,306
2,042
1,364
1,110
89
120
93
341
99
8,207
419
20
(7)
40,118
30,292
7,865
604
384
(3)
% $
1.0
0.1
0.1
0.1
0.1
0.1
0.1
—
—
—
—
—
—
—
—
0.4
—
—
0.1
—
—
0.5
0.4
0.1
0.1
0.1
—
—
—
—
—
—
0.3
—
—
—
1.6
1.2
0.3
—
—
—
23,498
2,576
2,547
2,527
1,872
1,539
1,419
517
351
145
59
82
(47)
176
59
9,543
36
82
3,119
68
(22)
12,815
9,773
2,313
2,020
1,350
1,099
95
120
95
345
104
8,202
418
20
(7)
40,460
30,566
7,934
609
387
—
263,499
260,975
10.1
257,983
23,863
15,149
1,105
—
2,244
24,012
15,053
1,123
—
2,227
0.9
0.6
0.1
—
0.1
23,624
14,998
1,094
(2)
2,222
See Notes to Consolidated Financial Statements.
173
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Watermill Express, LLC+
Watermill Express, LLC+(5)
Winebow Holdings, Inc.+
Investment Type
One stop
One stop
One stop
Spread
Above
Index
(1)
L +
L +
L +
5.50%
5.50%
6.25%
(a)
Interest
Rate
(2)
N/A(6)
N/A(6)
9.37%
Maturity
Date
04/2027
04/2027
07/2025
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
$
—
$
—
7,799
50,160
—
(1)
7,722
50,136
— % $
—
0.3
2.0
Fair
Value
(4)
—
(2)
7,799
49,733
See Notes to Consolidated Financial Statements.
174
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Building Products
BECO Holding Company, Inc.#+
BECO Holding Company, Inc.+(5)
BECO Holding Company, Inc.+(5)
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Jensen Hughes, Inc.+
Chemicals
Inhance Technologies Holdings LLC#+
Inhance Technologies Holdings LLC+
Inhance Technologies Holdings LLC+
Inhance Technologies Holdings LLC+
PHM NL SP Bidco B.V.+(8)(9)(14)
PHM NL SP Bidco B.V.+(8)(14)
PHM NL SP Bidco B.V.+(8)(9)(14)
PHM NL SP Bidco B.V.+(8)(9)(14)
Commercial Services & Supplies
CI (Quercus) Intermediate Holdings, LLC*+
CI (Quercus) Intermediate Holdings, LLC+(5)
CI (Quercus) Intermediate Holdings, LLC+(5)
Hydraulic Authority III Limited+(8)(9)(10)
Hydraulic Authority III Limited+(8)(9)(10)
Hydraulic Authority III Limited+(8)(9)(10)
Hydraulic Authority III Limited+(8)(9)(10)
North Haven Stack Buyer, LLC*+
Investment Type
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
Interest
Rate
(2)
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
E +
L +
SN +
E +
L +
L +
L +
SN +
E +
N/A
SN +
SF +
5.50%
5.50%
5.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
4.50%
5.25%
5.25%
5.25%
5.25%
6.25%
6.25%
6.25%
6.25%
5.25%
5.25%
5.25%
5.00%
5.00%
5.00%
5.50%
(b)
(a)(b)
(a)(b)
(a)(b)
(a)(b)
(a)(b)
(a)(b)
(b)(c)
(a)(b)
(a)(b)
(b)
(b)
(b)
(b)
(f)
(c)
(i)
(f)
(b)
(i)
(e)
(k)
9.17%
N/A(6)
N/A(6)
7.31%
7.31%
7.31%
7.31%
7.31%
7.31%
7.13%
7.31%
7.31%
7.53%
7.53%
7.53%
7.53%
8.11%
10.42%
8.44%
6.31%
8.92%
N/A(6)
N/A(6)
7.22%
6.19%
11.00%
N/A(6)
8.63%
PIK
Maturity
Date
11/2028
11/2027
11/2028
03/2024
03/2024
03/2024
03/2024
03/2024
03/2024
03/2024
03/2024
03/2024
07/2024
07/2024
07/2024
07/2024
09/2028
09/2028
09/2028
09/2028
10/2028
10/2028
10/2028
11/2025
11/2025
11/2028
11/2025
07/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
7,538
—
—
4,106
1,388
895
844
429
274
886
214
114
7,472
(4)
(17)
4,107
1,403
901
839
436
275
877
214
114
16,688
16,617
12,444
9,913
1,891
21
31,048
13,766
6,711
3,282
79,076
16,063
—
—
9,675
1,057
217
—
8,767
12,502
9,845
1,885
22
36,136
13,559
7,914
3,710
85,573
15,862
(3)
(20)
11,066
1,122
251
—
8,626
% $
0.3
—
—
0.2
0.1
—
—
—
—
—
—
—
0.6
0.5
0.4
0.1
—
1.2
0.5
0.2
0.1
3.0
0.6
—
—
0.4
—
—
—
0.4
7,387
(9)
(39)
4,106
1,388
895
844
429
274
886
214
114
16,489
12,319
9,813
1,872
19
30,116
13,353
6,510
3,161
77,163
15,741
(4)
(48)
9,675
1,057
217
—
8,591
See Notes to Consolidated Financial Statements.
175
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
North Haven Stack Buyer, LLC+(5)
North Haven Stack Buyer, LLC+
North Haven Stack Buyer, LLC+
North Haven Stack Buyer, LLC+
OVG Business Services, LLC+
OVG Business Services, LLC+
Profile Products LLC+
Profile Products LLC+(8)
Profile Products LLC+
Profile Products LLC+(5)
Profile Products LLC+(5)
PT Intermediate Holdings III, LLC+
PT Intermediate Holdings III, LLC+
PT Intermediate Holdings III, LLC+
Radwell Parent, LLC+
Radwell Parent, LLC+(5)
Radwell Parent, LLC+(5)
Trinity Air Consultants Holdings Corporation+
Trinity Air Consultants Holdings Corporation+
Trinity Air Consultants Holdings Corporation+
WRE Holding Corp.*#
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
WRE Holding Corp.+
Communications Equipment
Lightning Finco Limited+(8)(10)
Lightning Finco Limited+(8)(9)(10)
Containers and Packaging
AmerCareRoyal LLC+
AmerCareRoyal LLC+
AmerCareRoyal LLC+
AmerCareRoyal LLC+(8)
Chase Intermediate+
Chase Intermediate+(5)
Chase Intermediate+(5)
Fortis Solutions Group, LLC*#+
Fortis Solutions Group, LLC+
Fortis Solutions Group, LLC+(5)
Fortis Solutions Group, LLC+(5)
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Spread
Above
Index
(1)
5.50%
5.50% (k)
5.50% (k)
5.50% (k)
6.25% (a)
5.50% (a)
5.50% (b)
5.50% (b)
5.50% (a)(d)
5.50%
5.25%
5.50% (b)
5.50% (b)
5.50% (b)
5.75% (l)
5.75%
5.75%
5.25% (c)
5.25% (c)
5.25%
5.25% (l)
5.25% (l)
5.25% (l)
5.25% (l)
5.25% (l)
5.25% (l)
5.25% (l)
5.25% (l)
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
L +
L +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
One stop
One stop
L +
E +
5.50% (b)
5.50% (e)
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
5.50% (a)
5.50% (a)
5.50% (a)
5.50% (a)
5.00% (b)(c)
5.00%
5.00%
5.50% (b)(c)
5.50% (c)
5.50%
5.50%
N/A(6)
8.63%
8.63%
8.63%
9.34%
8.14%
8.43%
8.42%
8.60%
N/A(6)
N/A(6)
9.17%
9.17%
9.17%
9.40%
N/A(6)
N/A(6)
7.08%
8.60%
N/A(6)
7.95%
7.95%
7.95%
7.95%
7.95%
7.95%
7.95%
7.99%
8.57%
6.25%
8.12%
8.12%
8.12%
8.12%
8.00%
N/A(6)
N/A(6)
9.59%
9.67%
N/A(6)
N/A(6)
Interest
Rate
(2)
cash/
cash/
cash/
cash/
0.50%
0.50%
0.50%
0.50%
PIK
PIK
PIK
PIK
Maturity
Date
07/2027
07/2027
07/2027
07/2027
11/2028
11/2026
11/2027
11/2027
11/2027
11/2027
11/2027
11/2028
11/2028
11/2028
03/2029
03/2028
03/2029
06/2027
06/2027
06/2027
01/2025
01/2025
01/2025
01/2025
01/2025
01/2025
01/2025
01/2025
09/2028
09/2028
11/2025
11/2025
11/2025
11/2025
10/2028
10/2028
10/2028
10/2028
10/2027
10/2028
10/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
—
38
2,953
974
1,800
9
5,466
1,288
18
—
—
29,523
20,873
9,900
19,076
—
—
2,458
33
—
2,229
920
675
399
128
23
14
16
(22)
37
2,929
966
1,764
9
5,359
1,266
17
(8)
(1)
29,029
20,681
9,775
18,789
(4)
(8)
2,419
32
—
2,225
920
673
398
129
23
13
14
134,592
134,328
10,349
1,041
11,390
748
160
155
134
9,900
—
—
33,683
20
—
—
10,174
1,240
11,414
739
158
153
133
9,819
(3)
(11)
33,177
15
(95)
(40)
44,800
44,045
— % $
—
0.1
—
0.1
—
0.2
0.1
—
—
—
1.2
0.8
0.4
0.7
—
—
0.1
—
—
0.1
—
—
—
—
—
—
—
5.2
0.4
—
0.4
—
—
—
—
0.4
—
—
1.3
—
—
—
1.7
(56)
35
2,894
955
1,764
8
5,466
1,288
18
—
—
28,932
20,456
9,702
18,313
(9)
(22)
2,409
31
—
2,229
920
675
399
128
23
14
16
131,817
10,142
1,020
11,162
733
156
152
132
9,702
(7)
(24)
33,346
17
(12)
(56)
44,139
See Notes to Consolidated Financial Statements.
176
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Distributors
WSC Holdings Midco LLC+
WSC Holdings Midco LLC+
WSC Holdings Midco LLC+
WSC Holdings Midco LLC+(5)
WSC Holdings Midco LLC+(5)
Diversified Consumer Services
Certus Pest, Inc.#
Certus Pest, Inc.#
Certus Pest, Inc.+
Certus Pest, Inc.#
Certus Pest, Inc.+
Certus Pest, Inc.#
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+
Certus Pest, Inc.+(5)
Certus Pest, Inc.+(5)
Certus Pest, Inc.+(5)
CHHJ Midco, LLC#
CHHJ Midco, LLC+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
COP Hometown Acquisitions, Inc.+
DP Flores Holdings, LLC+
DP Flores Holdings, LLC+(5)
DP Flores Holdings, LLC+(5)
DP Flores Holdings, LLC+
DP Flores Holdings, LLC+(5)
EMS LINQ, LLC+
EMS LINQ, LLC+(5)
EWC Growth Partners LLC+
EWC Growth Partners LLC+
EWC Growth Partners LLC+
Excelligence Learning Corporation#+
FPG Intermediate Holdco, LLC+
FPG Intermediate Holdco, LLC+
FPG Intermediate Holdco, LLC+(5)
FPG Intermediate Holdco, LLC+(5)
FSS Buyer LLC+
FSS Buyer LLC+(5)
HS Spa Holdings, Inc.+
Interest
Rate
(2)
Investment Type
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
4.50% (l)
4.50% (l)
4.50% (l)
4.50%
4.50%
6.25% (m)
6.25% (m)
6.25% (m)
6.25% (l)(m)
6.25% (m)
6.25% (m)
6.25% (l)
6.25% (l)
6.25% (m)
6.25% (m)
6.25% (l)
6.25%
6.25%
6.25%
5.00% (a)
5.00%
4.50% (b)
4.50% (b)
4.50% (b)
4.50% (b)
4.50% (b)
4.75% (b)
4.50%
6.50% (l)
6.50%
6.50%
6.50%
6.50%
6.25% (a)
6.25%
6.00% (b)
6.00% (b)
6.00% (b)
6.00% (b)
6.00% (k)
6.00% (k)
6.00%
6.50%
5.75% (a)
5.75%
5.75% (m)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
SF +
L +
L +
SF +
7.13%
7.30%
7.13%
N/A(6)
N/A(6)
9.08%
9.08%
8.19%
10.04%
9.08%
9.08%
9.95%
9.95%
9.08%
9.08%
9.95%
N/A(6)
N/A(6)
N/A(6)
8.12%
N/A(6)
7.24%
6.78%
6.87%
7.19%
6.78%
7.75%
N/A(6)
10.00%
N/A(6)
N/A(6)
N/A(6)
N/A(6)
9.37%
N/A(6)
9.67%
9.67%
9.67%
9.67%
9.13%
9.13%
N/A(6)
N/A(6)
8.87%
N/A(6)
7.51%
Maturity
Date
07/2027
07/2027
07/2027
07/2027
07/2027
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
02/2026
01/2026
01/2026
07/2027
07/2027
07/2027
07/2027
07/2027
07/2027
07/2027
09/2028
09/2028
09/2028
09/2028
09/2028
12/2027
12/2027
03/2026
03/2026
03/2026
04/2023
03/2027
03/2027
03/2027
03/2027
08/2028
08/2027
06/2029
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
1,244
1,797
2,961
—
—
6,002
1,589
1,524
1,099
1,080
753
664
647
382
239
131
55
—
—
—
2,723
—
1,713
1,669
1,094
773
199
120
—
2,593
—
—
—
—
9,591
—
930
74
14
10,240
9,098
314
—
—
5,491
—
7,782
1,231
1,782
2,931
(1)
(1)
5,942
1,560
1,479
1,099
1,070
739
632
643
374
225
105
50
—
(2)
(13)
2,705
—
1,699
1,648
1,082
764
196
118
—
2,548
(2)
(15)
—
(25)
9,508
(1)
920
73
14
10,204
8,964
303
(1)
(13)
5,399
(1)
7,634
— % $
0.1
0.1
—
—
0.2
0.1
0.1
0.1
0.1
—
—
—
—
—
—
—
—
—
—
0.1
—
0.1
0.1
0.1
—
—
—
—
0.1
—
—
—
—
0.4
—
0.1
—
—
0.4
0.3
—
—
—
0.2
—
0.3
1,232
1,779
2,932
(1)
(1)
5,941
1,557
1,493
1,077
1,058
738
651
634
374
235
128
54
(1)
—
(99)
2,723
—
1,696
1,652
1,083
765
197
120
—
2,548
(2)
(15)
—
—
9,495
(1)
920
73
14
10,240
8,756
287
(3)
(14)
5,272
(2)
7,627
See Notes to Consolidated Financial Statements.
177
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
HS Spa Holdings, Inc.+(5)
Learn-it Systems, LLC+
Learn-it Systems, LLC+
Learn-it Systems, LLC+
Learn-it Systems, LLC+
Liminex, Inc.+
Liminex, Inc.+
Liminex, Inc.+
Liminex, Inc.+(5)
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Litera Bidco LLC+
Mario Purchaser, LLC+
Mario Purchaser, LLC+
Mario Purchaser, LLC+(5)
Mario Purchaser, LLC+
Mathnasium, LLC#
Mathnasium, LLC+
NSG Buyer, Inc. +
NSG Buyer, Inc. +
NSG Buyer, Inc. +
NSG Buyer, Inc. +
NSG Buyer, Inc. +
PADI Holdco, Inc.*#
PADI Holdco, Inc.+(8)(9)
PADI Holdco, Inc.+
PADI Holdco, Inc.+
PADI Holdco, Inc.+(5)
Provenance Buyer LLC#+
Provenance Buyer LLC+
Provenance Buyer LLC+(5)
Provenance Buyer LLC+(5)
RW AM Holdco LLC#+
RW AM Holdco LLC+(5)
Investment Type
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
L +
L +
L +
L +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
SF +
SF +
P +
SF +
L +
L +
SF +
SF +
SF +
SF +
SF +
L +
E +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
Spread
Above
Index
(1)
5.75%
4.75%
4.75%
4.75%
4.75%
7.25%
6.25%
7.25%
7.25%
6.00%
5.75%
5.75%
5.75%
(c)
(b)
(b)(c)
(b)
(l)
(l)
(l)
(a)
(a)
(a)
(a)
(a)
6.00%
5.75%
5.75%
(k)
10.75% (k)
4.75%
5.75%
(k)
5.00%
5.00%
6.00%
6.00%
6.00%
6.00%
6.00%
7.25%
7.25%
7.25%
7.25%
5.75%
5.00%
5.00%
5.00%
5.00%
5.25%
5.25%
(b)
(b)
(k)
(k)
(k)
(k)
(k)
(b)
(e)
(b)
(b)
(a)
(a)
(m)
Interest
Rate
(2)
PIK
cash/
cash/
cash/
cash/
1.50%
1.50%
1.50%
1.50%
PIK
PIK
PIK
PIK
N/A(6)
8.92%
8.42%
8.30%
7.63%
10.95%
9.95%
10.95%
N/A(6)
9.12%
8.87%
8.87%
8.87%
9.12%
N/A(6)
8.88%
13.88%
N/A(6)
8.88%
7.91%
7.91%
9.13%
9.13%
9.13%
9.13%
9.13%
8.82%
6.33%
9.38%
8.90%
N/A(6)
8.12%
8.12%
N/A(6)
N/A(6)
9.48%
N/A(6)
Maturity
Date
06/2028
03/2025
03/2025
03/2025
03/2025
11/2026
11/2026
11/2026
11/2026
05/2026
05/2026
05/2026
05/2026
05/2026
05/2025
04/2029
04/2032
04/2028
04/2029
11/2027
11/2027
06/2029
06/2029
06/2029
06/2029
06/2028
04/2024
04/2024
04/2024
04/2024
04/2023
06/2027
06/2027
06/2027
06/2027
04/2028
04/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
—
$
2,497
1,344
606
33
25,462
20,000
800
—
5,718
3,674
688
688
517
—
7,654
1,527
—
109
9,261
13
7,874
242
141
133
12
21,638
17,873
824
170
—
18,279
9,975
—
—
17,729
—
(2)
2,521
1,341
598
32
25,129
19,816
794
(1)
5,666
3,688
705
705
513
—
7,510
1,487
(1)
104
9,182
12
7,798
239
140
117
11
21,619
20,923
820
170
(1)
17,987
9,881
(2)
(2)
17,565
(1)
238,062
238,745
— % $
0.1
—
—
—
1.0
0.8
—
—
0.2
0.1
—
—
—
—
0.3
0.1
—
—
0.4
—
0.3
—
—
—
—
0.8
0.7
—
—
—
0.7
0.4
—
—
0.7
—
9.2
(2)
2,297
1,236
558
29
25,971
19,800
816
—
5,662
3,609
676
676
512
—
7,347
1,497
(3)
94
9,168
12
7,874
242
141
133
12
20,771
17,156
791
163
(4)
18,279
9,975
—
—
17,551
(2)
234,367
See Notes to Consolidated Financial Statements.
178
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Diversified Financial Services
AxiomSL Group, Inc.+
AxiomSL Group, Inc.+
AxiomSL Group, Inc.+
Banker's Toolbox, Inc.+
Banker's Toolbox, Inc.+(5)
Banker's Toolbox, Inc.+
Flash Topco, Inc.*
Flash Topco, Inc.+(5)
Higginbotham Insurance Agency, Inc.+
Higginbotham Insurance Agency, Inc.+
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
6.00% (a)
6.00%
6.00%
5.25% (m)
5.25%
5.25% (c)
5.75% (b)
5.75%
5.25% (a)
5.25% (a)
L +
L +
L +
SF +
L +
L +
L +
L +
L +
L +
Interest
Rate
(2)
9.12%
N/A(6)
N/A(6)
9.23%
N/A(6)
8.74%
8.56%
N/A(6)
8.37%
8.37%
Maturity
Date
12/2027
12/2027
12/2025
07/2027
07/2027
07/2027
10/2028
10/2028
11/2026
11/2026
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
4,016
—
—
8,017
—
990
9,820
—
4,577
26
3,951
—
—
7,938
—
985
9,734
(1)
4,528
25
27,446
27,160
% $
0.2
—
—
0.3
—
—
0.4
—
0.2
—
1.1
3,976
—
—
7,857
(2)
921
9,623
(2)
4,531
24
26,928
See Notes to Consolidated Financial Statements.
179
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Diversified Telecommunication Services
NTI Connect, LLC+
Electronic Equipment, Instruments & Components
CST Buyer Company#+
CST Buyer Company#+
CST Buyer Company+
Electrical Source Holdings, LLC*#+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+(5)
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+
Electrical Source Holdings, LLC+(5)
Electrical Source Holdings, LLC+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Senior secured
L +
5.00%
(b)
8.67%
12/2024
$
1,628
$
1,609
0.1
% $
1,628
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
5.50%
5.50%
5.50%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
(a)
(a)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
8.62%
8.62%
N/A(6)
8.07%
8.67%
8.07%
8.67%
8.67%
8.67%
8.67%
8.67%
N/A(6)
8.67%
8.07%
8.67%
8.67%
N/A(6)
7.77%
10/2025
10/2025
10/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
20,121
10,140
—
75,982
19,780
1,752
648
137
94
89
88
—
46
41
35
17
—
19,964
10,074
—
75,698
19,780
1,752
642
136
94
88
86
(2)
45
41
35
17
(119)
2,305
131,275
2,305
130,636
0.8
0.4
—
3.0
0.8
0.1
—
—
—
—
—
—
—
—
—
—
—
0.1
5.2
20,121
10,140
—
75,982
19,780
1,752
648
137
94
89
88
—
46
41
35
17
—
2,305
131,275
See Notes to Consolidated Financial Statements.
180
TABLE OF CONTENTS
Food & Staples Retailing
Cafe Rio Holding, Inc.*#
Cafe Rio Holding, Inc.+
Cafe Rio Holding, Inc.#+
Cafe Rio Holding, Inc.*#
Cafe Rio Holding, Inc.#+
Cafe Rio Holding, Inc.+
Cafe Rio Holding, Inc.+
Cafe Rio Holding, Inc.+(5)
Cafe Rio Holding, Inc.+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+
Mendocino Farms, LLC+(5)
Ruby Slipper Cafe LLC, The*+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Wetzel's Pretzels, LLC*#+
Wetzel's Pretzels, LLC+
Wineshipping.com LLC+
Wineshipping.com LLC+
Wineshipping.com LLC+
Wood Fired Holding Corp.*#
Wood Fired Holding Corp.+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 5.50%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 6.25%
SF + 7.50%
SF + 7.50%
SF + 7.50%
SF + 7.50%
SF + 7.50%
6.50%
L +
L +
L +
L +
L +
L +
L +
6.50%
5.75%
5.75%
5.75%
6.25%
6.25%
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(l)
(l)
(l)
(l)
(b)
(b)
(c)
(b)
(b)
(b)
9.20%
9.20%
9.20%
9.20%
9.20%
9.20%
9.20%
N/A(6)
9.20%
9.38%
9.38%
9.38%
9.38%
9.38%
9.38%
9.38%
N/A(6)
11.20%
11.20%
11.20%
11.20%
N/A(6)
10.17%
10.17%
7.58%
8.17%
8.83%
8.67%
N/A(6)
Maturity
Date
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
09/2028
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2024
06/2024
06/2024
06/2024
06/2024
09/2023
09/2023
10/2027
10/2027
10/2027
12/2023
12/2023
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
18,226
3,277
2,203
1,398
1,235
110
178
—
80
931
731
718
353
353
174
106
—
2,025
410
292
—
—
14,768
—
6,793
186
17
9,679
—
18,096
3,241
2,202
1,397
1,234
107
176
(1)
79
928
730
710
350
349
172
104
(20)
2,019
411
289
—
—
14,679
—
6,736
178
16
9,728
—
64,243
63,910
% $
0.7
0.1
0.1
0.1
0.1
—
—
—
—
—
—
—
—
—
—
—
—
0.1
—
—
—
—
0.6
—
0.3
—
—
0.4
—
2.5
18,226
3,277
2,203
1,398
1,235
110
178
—
80
922
724
711
350
349
172
105
(21)
2,025
410
292
—
—
14,768
—
6,590
180
14
9,679
—
63,977
See Notes to Consolidated Financial Statements.
181
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Food Products
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+(5)
Borrower R365 Holdings, LLC+(5)
Flavor Producers, LLC#+
Flavor Producers, LLC+
Kodiak Cakes, LLC*#+
Kodiak Cakes, LLC+
Louisiana Fish Fry Products, Ltd.*+
Louisiana Fish Fry Products, Ltd.+
MAPF Holdings, Inc.*#+
MAPF Holdings, Inc.+
P&P Food Safety Holdings, Inc.*+
P&P Food Safety Holdings, Inc.+
P&P Food Safety Holdings, Inc.+(5)
Purfoods, LLC+
Ultimate Baked Goods Midco LLC+
Ultimate Baked Goods Midco LLC+
Whitebridge Pet Brands, LLC*#+
Whitebridge Pet Brands, LLC+
Wizard Bidco Limited+(8)(9)(10)
Wizard Bidco Limited+(5)(8)(9)(10)
Investment Type
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
L +
L +
L +
L +
L +
L +
L +
L +
SF +
L +
L +
L +
L +
L +
L +
N/A
L +
L +
L +
6.50%
6.50%
6.50%
6.50%
5.75%
5.75%
6.00%
6.00%
6.25%
6.25%
5.50%
5.50%
6.00%
6.00%
6.00%
6.50%
6.50%
5.00%
5.00%
L +
SN + 4.75%
SN + 4.75%
(b)
(b)
(b)
(b)
(b)
(b)
(k)
(c)(k)
(b)
(b)
(c)
(b)
(a)
(a)(d)
(a)
(a)
(i)
7.18%
7.18%
N/A(6)
N/A(6)
7.82%
7.82%
9.67%
9.67%
9.38%
9.24%
9.17%
9.17%
8.88%
9.67%
N/A(6)
7.00%
9.62%
9.92%
8.12%
7.98%
6.94%
N/A(6)
Interest
Rate
(2)
cash/
cash/
3.00%
3.00%
cash/
cash/
1.00%
1.00%
PIK
PIK
PIK
PIK
PIK
Maturity
Date
06/2027
06/2027
06/2027
06/2027
12/2023
12/2022
06/2027
06/2026
07/2027
07/2027
12/2026
12/2026
12/2026
12/2026
12/2026
05/2026
08/2027
08/2027
07/2027
07/2027
03/2029
09/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
13,490
1,112
—
—
5,001
2
12,369
100
9,777
73
37,979
70
17,722
38
—
66
6,671
47
23,003
130
6,067
—
13,288
1,094
(1)
(1)
4,962
2
12,246
99
9,698
71
37,709
68
17,551
37
(5)
69
6,604
19
22,686
128
7,062
(1)
133,717
133,385
% $
0.5
0.1
—
—
0.2
—
0.4
—
0.4
—
1.5
—
0.7
—
—
—
0.2
—
0.9
—
0.2
—
5.1
13,490
1,112
—
—
4,851
2
11,379
87
8,994
65
37,979
70
17,367
36
—
66
6,004
41
23,003
130
6,067
—
130,743
See Notes to Consolidated Financial Statements.
182
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Health Care Equipment & Supplies
Aspen Medical Products, LLC#+
Aspen Medical Products, LLC+
Aspen Medical Products, LLC+
Baduhenna Bidco Limited+(8)(10)
Baduhenna Bidco Limited+(8)(9)(10)
Baduhenna Bidco Limited+(8)(9)(10)
Baduhenna Bidco Limited+(8)(9)(10)
Baduhenna Bidco Limited+(5)(8)(9)(10)
Belmont Instrument, LLC+
Belmont Instrument, LLC+(5)
Blades Buyer, Inc.#+
Blades Buyer, Inc.+
Blades Buyer, Inc.+(5)
Blades Buyer, Inc.+
Blue River Pet Care, LLC*#+
Blue River Pet Care, LLC+(5)
Blue River Pet Care, LLC+(5)
Blue River Pet Care, LLC+
Blue River Pet Care, LLC+
CCSL Holdings, LLC*+
CCSL Holdings, LLC+
CCSL Holdings, LLC+(8)(9)
CCSL Holdings, LLC+
CCSL Holdings, LLC+(5)
CCSL Holdings, LLC+(5)
CMI Parent Inc.#+
CMI Parent Inc.+
CMI Parent Inc.+(5)
CMI Parent Inc.+
G & H Wire Company, Inc.#+
G & H Wire Company, Inc.+
Joerns Healthcare, LLC*+(7)
Joerns Healthcare, LLC*+(7)
Joerns Healthcare, LLC+
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
5.00% (b)
5.00% (b)
5.00%
6.50% (j)
6.45% (e)
6.50% (i)
6.45% (e)
6.50%
6.25% (l)
6.25%
4.75% (l)(m)
4.75% (k)
4.75%
4.75%
5.00% (a)
5.00%
5.00%
5.00% (a)
5.00% (a)
6.50% (k)
6.50% (k)
6.50% (i)
6.50% (d)(k)
6.50%
6.50%
4.25% (b)
4.25% (b)
4.25%
4.75% (l)
8.00% (c)
8.00% (b)
16.00% (l)
16.00% (l)
L +
L +
L +
SF +
E +
SF +
E +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
SF +
SF +
SN +
SF +
SF +
SF +
L +
L +
L +
SF +
L +
L +
SF +
SF +
N/A
7.39%
7.39%
N/A(6)
9.61%
6.70%
8.76%
7.64%
N/A(6)
9.69%
N/A(6)
7.43%
7.47%
N/A(6)
N/A(6)
8.12%
N/A(6)
N/A(6)
7.94%
8.12%
9.63%
9.63%
8.79%
9.73%
N/A(6)
N/A(6)
7.26%
7.92%
N/A(6)
8.30%
11.17%
10.24%
9.75%
9.75%
15.00%
Interest
Rate
(2)
cash/
cash/
cash/
cash/
PIK
1.00%
1.00%
10.00%
10.00%
PIK
PIK
PIK
PIK
Maturity
Date
06/2025
06/2025
06/2025
08/2028
08/2028
08/2028
08/2028
08/2028
08/2028
08/2028
03/2028
03/2028
03/2028
03/2028
07/2026
08/2025
07/2026
07/2026
07/2026
12/2026
12/2026
12/2026
12/2026
12/2026
12/2026
08/2025
08/2025
08/2025
08/2025
09/2023
10/2022
08/2024
08/2024
11/2022
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
4,115
263
—
5,415
2,839
790
677
—
9,900
—
10,045
33
—
—
51,197
—
—
180
173
15,399
4,156
2,175
115
—
—
6,499
3,220
—
2,932
11,133
72
2,084
2,003
1,290
4,155
262
—
5,353
3,389
940
756
(17)
9,803
(1)
9,940
31
(1)
—
50,889
(2)
(10)
178
172
15,261
4,123
2,428
113
(15)
(24)
6,563
3,196
(2)
2,903
11,109
72
1,963
1,889
1,287
136,705
136,703
% $
0.2
—
—
0.2
0.1
—
—
—
0.4
—
0.4
—
—
—
2.0
—
—
—
—
0.6
0.2
0.1
—
—
—
0.3
0.1
—
0.1
0.4
—
—
—
—
5.1
4,074
260
—
5,415
2,806
784
669
(8)
9,801
(1)
9,786
27
(8)
—
50,686
(4)
(11)
178
171
15,244
4,114
2,154
113
(14)
(26)
6,434
3,188
(4)
2,903
10,911
68
104
—
1,161
130,975
See Notes to Consolidated Financial Statements.
183
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Health Care Providers & Services
AAH TOPCO, LLC +
AAH TOPCO, LLC +
AAH TOPCO, LLC +(5)
AAH TOPCO, LLC +
Active Day, Inc.#+
Active Day, Inc.#+
Active Day, Inc.*#
Active Day, Inc.+
Active Day, Inc.+
Active Day, Inc.*#
Active Day, Inc.+(5)
Active Day, Inc.+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC#+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
Advanced Pain Management Holdings, Inc.+(7)
Advanced Pain Management Holdings, Inc.+(7)
Advanced Pain Management Holdings, Inc.+(7)
Advanced Pain Management Holdings, Inc.+(7)
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+(5)
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+(5)
Community Care Partners, LLC+
Community Care Partners, LLC+(5)
CRH Healthcare Purchaser, Inc.*+
Interest
Rate
(2)
PIK
cash/
6.75%
PIK
cash/
6.75%
PIK
Investment Type
One stop
Subordinated debt
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
Subordinated debt
Subordinated debt
Subordinated debt
One stop
One stop
One stop
One stop
One stop
Senior secured
Spread
Above
Index
(1)
5.50%
(a)
5.50%
5.50%
5.25%
5.25%
5.25%
5.25%
5.25%
5.25%
5.25%
5.25%
6.00%
6.25%
6.25%
6.25%
6.25%
6.00%
6.25%
6.25%
13.00%
6.25%
6.00%
6.25%
13.00%
6.25%
6.25%
6.00%
3.75%
8.50%
3.75%
3.75%
6.13%
6.13%
10.50%
10.50%
10.50%
6.25%
6.00%
6.25%
5.75%
5.75%
4.50%
(a)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(l)
(d)
(a)
(d)
(d)
(b)
(b)
(a)
(a)
(a)
(a)
(k)
(b)
L +
N/A
L +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
N/A
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
P +
L +
P +
P +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
L +
8.58%
11.50%
N/A(6)
8.36%
8.38%
8.38%
8.38%
8.38%
8.38%
8.38%
N/A(6)
8.38%
9.47%
15.00%
9.95%
9.77%
9.95%
9.95%
9.02%
9.95%
9.95%
9.95%
9.95%
9.71%
9.04%
9.76%
9.95%
9.94%
9.06%
10.00%
11.62%
10.00%
10.00%
9.80%
9.80%
13.62%
13.62%
13.62%
9.37%
N/A(6)
N/A(6)
8.89%
N/A(6)
8.17%
Maturity
Date
12/2027
12/2031
12/2027
12/2027
02/2025
02/2025
02/2025
02/2025
02/2025
02/2025
02/2025
02/2025
03/2025
06/2027
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
07/2021
07/2021
07/2021
07/2021
03/2027
03/2027
03/2028
03/2028
03/2028
03/2027
03/2027
03/2027
06/2026
06/2026
12/2024
See Notes to Consolidated Financial Statements.
184
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
8,329
1,080
—
193
17,746
1,369
883
704
620
610
—
—
16,467
10,440
4,077
3,632
3,504
3,203
2,047
1,868
452
251
167
61
110
96
1
145
208
17,456
6,906
1,190
888
4,708
3,936
1,900
726
163
97
—
—
2,349
—
19,502
8,256
1,062
(1)
187
17,566
1,356
874
696
615
604
(2)
—
16,342
10,239
4,071
3,607
3,516
3,246
2,016
1,909
455
250
166
51
109
96
1
145
206
6,855
6
469
544
4,661
3,882
1,874
719
159
95
(1)
(1)
2,330
(3)
19,499
0.3 % $
—
—
—
0.7
0.1
0.1
0.1
—
—
—
—
0.6
0.4
0.2
0.2
0.2
0.1
0.1
0.1
—
—
—
—
—
—
—
—
—
—
—
—
—
0.2
0.2
0.1
—
—
—
—
—
0.1
—
0.8
8,079
1,026
(2)
175
17,389
1,343
865
689
608
597
(4)
—
16,213
10,440
4,036
3,596
3,469
3,172
2,016
1,849
447
266
165
45
109
102
1
143
205
—
—
—
—
4,505
3,766
1,900
726
163
89
(3)
(3)
2,325
(3)
19,502
TABLE OF CONTENTS
CRH Healthcare Purchaser, Inc.#
CRH Healthcare Purchaser, Inc.#+
CRH Healthcare Purchaser, Inc.+
CRH Healthcare Purchaser, Inc.+
Datix Bidco Limited+(8)(9)(10)
Datix Bidco Limited+(8)(9)(10)
Emerge Intermediate, Inc.*#
Emerge Intermediate, Inc.+
Emerge Intermediate, Inc.+(5)
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Encorevet Group LLC+(5)
Encorevet Group LLC+(5)
ERC Topco Holdings, LLC+
ERC Topco Holdings, LLC+(5)
ERC Topco Holdings, LLC+(5)
Eyecare Services Partners Holdings LLC+
Eyecare Services Partners Holdings LLC*+
Eyecare Services Partners Holdings LLC*#
Eyecare Services Partners Holdings LLC+
Eyecare Services Partners Holdings LLC*+
Eyecare Services Partners Holdings LLC*+
Eyecare Services Partners Holdings LLC*#
Eyecare Services Partners Holdings LLC*#
Eyecare Services Partners Holdings LLC+
Eyecare Services Partners Holdings LLC*+
Eyecare Services Partners Holdings LLC+
Eyecare Services Partners Holdings LLC+
Eyecare Services Partners Holdings LLC+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Second lien
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
L +
L +
4.50%
4.50%
4.50%
L +
L +
4.50%
SN + 4.50%
SN + 7.75%
6.50%
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
6.50%
6.50%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
5.50%
5.50%
5.50%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
9.25%
(b)
(b)
(b)
(b)
(i)
(i)
(l)
(l)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(b)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
Interest
Rate
(2)
cash/
cash/
0.50%
0.50%
PIK
PIK
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
8.25%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
8.17%
8.17%
8.17%
8.10%
6.69%
9.94%
9.70%
9.70%
N/A(6)
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
N/A(6)
N/A(6)
9.17%
N/A(6)
N/A(6)
4.13%
4.13%
4.12%
4.12%
4.12%
4.12%
4.12%
4.12%
4.14%
4.13%
4.14%
4.14%
4.14%
Maturity
Date
12/2024
12/2024
12/2024
12/2024
04/2025
04/2026
05/2024
05/2024
05/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2028
11/2027
11/2028
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
05/2023
See Notes to Consolidated Financial Statements.
185
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
5,197
4,112
3,521
50
49,685
17,630
19,277
1,745
—
985
619
307
294
266
244
163
114
110
68
57
56
32
10
—
—
9,546
—
—
19,569
8,584
7,518
5,533
2,567
1,648
1,218
1,073
1,168
693
428
837
837
5,162
4,098
3,495
49
59,896
21,227
19,162
1,734
(2)
979
615
305
292
264
243
162
113
110
68
56
55
32
10
—
(1)
9,471
(1)
(3)
19,596
8,615
7,546
5,538
2,577
1,654
1,222
1,077
1,159
695
428
832
832
0.2 % $
0.2
0.2
—
1.9
0.7
0.8
0.1
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
0.4
—
—
0.5
0.2
0.2
0.1
0.1
—
—
—
—
—
—
—
—
5,197
4,112
3,521
50
47,200
16,748
19,277
1,745
—
965
607
301
288
261
239
160
112
107
67
56
55
32
10
(1)
—
9,259
(5)
(7)
12,720
5,580
4,887
3,596
1,669
1,070
792
697
613
451
278
837
544
TABLE OF CONTENTS
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(5)(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(5)(8)(12)
FYI Optical Acquisitions, Inc. & FYI USA, Inc.+(8)(9)(12)
Heartland Veterinary Partners LLC+
Heartland Veterinary Partners LLC+
Heartland Veterinary Partners LLC+
Klick Inc.+(8)(12)
Klick Inc.+(5)(8)(12)
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+
Krueger-Gilbert Health Physics, LLC+(5)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)
(12)
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)
(12)
Oliver Street Dermatology Holdings, LLC+(7)
Oliver Street Dermatology Holdings, LLC+
Oliver Street Dermatology Holdings, LLC+
Pinnacle Treatment Centers, Inc.#+
Pinnacle Treatment Centers, Inc.*
Pinnacle Treatment Centers, Inc.#+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
PPT Management Holdings, LLC+(7)
PPT Management Holdings, LLC+(7)
PPT Management Holdings, LLC+(7)
PPT Management Holdings, LLC+(7)
PPT Management Holdings, LLC+(7)
PPT Management Holdings, LLC+
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
C +
C +
C +
4.50%
4.50%
4.50%
C +
4.50%
4.50%
L +
SF + 4.50%
C +
4.50%
SF + 4.75%
SF + 4.75%
SF + 4.75%
4.50%
L +
4.50%
L +
5.25%
L +
5.25%
L +
5.25%
L +
L +
L +
5.25%
5.25%
C +
5.50%
L +
5.50%
L +
5.50%
C +
5.50%
C +
5.50%
C +
5.50%
L +
5.50%
L +
5.50%
SF + 11.43%
SF + 6.25%
SF + 6.25%
5.75%
L +
5.75%
L +
5.75%
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
5.75%
5.75%
5.75%
5.75%
5.75%
8.50%
8.50%
10.50%
8.50%
8.50%
10.50%
(h)
(h)
(h)
(b)
(h)
(l)
(l)
(b)
(b)
(b)
(b)
(b)
(h)
(b)
(b)
(h)
(h)
(h)
(b)
(b)
(l)
(l)
(l)
(b)
(b)
(b)
(b)
(b)
(a)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
7.26%
N/A(6)
8.67%
8.67%
8.17%
N/A(6)
8.67%
7.63%
7.63%
N/A(6)
8.17%
N/A(6)
8.92%
8.92%
8.92%
8.92%
N/A(6)
9.67%
9.17%
9.17%
9.67%
9.67%
9.65%
9.17%
9.17%
15.13%
9.95%
9.95%
8.56%
8.56%
8.56%
8.56%
8.56%
8.81%
8.56%
8.56%
8.28%
8.28%
8.28%
8.28%
8.28%
N/A(6)
cash/
cash/
cash/
cash/
cash/
2.50%
2.50%
4.50%
2.50%
2.50%
PIK
PIK
PIK
PIK
PIK
See Notes to Consolidated Financial Statements.
186
Maturity
Date
03/2027
03/2027
03/2027
03/2027
03/2027
03/2027
03/2027
12/2026
12/2026
12/2026
03/2028
03/2026
05/2025
05/2025
05/2025
05/2025
05/2025
05/2028
05/2028
05/2028
05/2028
05/2028
05/2026
05/2026
05/2028
01/2023
01/2023
01/2023
01/2023
01/2023
01/2023
01/2023
01/2023
01/2023
01/2023
01/2023
12/2022
12/2022
12/2022
12/2022
12/2022
12/2022
Principal ($) /
Shares
(3)
Amortized Cost
$
$
11,224
—
502
11,520
(2)
542
Percentage
of Net
Assets
Fair
Value
(4)
0.4 % $
—
—
11,224
—
502
178
74
—
736
844
62
—
9,997
—
2,311
1,858
1,091
60
—
183
74
(1)
777
837
61
—
9,919
(1)
2,305
1,846
1,113
60
(14)
17,736
19,985
4,326
2,816
1,081
563
103
60
18
22,787
13,521
348
18,732
7,553
1,539
695
184
145
105
37
25,694
312
284
184
90
—
4,275
2,791
1,188
586
106
60
18
16,786
12,666
329
18,730
7,548
1,539
695
184
145
105
37
25,514
310
282
183
88
—
—
—
—
—
—
—
—
0.4
—
0.1
0.1
—
—
—
0.7
0.2
0.1
—
—
—
—
—
0.7
0.5
—
0.7
0.3
0.1
—
—
—
—
—
0.8
—
—
—
—
—
178
74
—
736
827
59
—
9,997
—
2,311
1,858
1,091
60
—
17,381
4,239
2,760
1,060
519
100
59
16
17,090
12,845
331
18,732
7,553
1,539
695
184
145
105
37
19,270
234
214
138
68
—
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Suveto Buyer, LLC+
Suveto Buyer, LLC+
Investment Type
One stop
One stop
Spread
Above
Index
(1)
Interest
Rate
(2)
L +
L +
5.00%
5.00%
(b)
(b)
8.67%
8.66%
Maturity
Date
09/2027
09/2027
Principal ($) /
Shares
(3)
Amortized Cost
$
$
18,330
64
470,089
18,110
62
459,629
Percentage
of Net
Assets
Fair
Value
(4)
0.7 % $
—
16.0
17,528
58
405,913
See Notes to Consolidated Financial Statements.
187
TABLE OF CONTENTS
Health Care Technology
Alegeus Technologies Holdings Corp.+
Coding Solutions Acquisition, Inc.+
Coding Solutions Acquisition, Inc.+
Coding Solutions Acquisition, Inc.+(5)
Connexin Software, Inc.+
Connexin Software, Inc.+
ESO Solution, Inc.+
ESO Solution, Inc.+(5)
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
Nextech Holdings, LLC+
Nextech Holdings, LLC+
Nextech Holdings, LLC+(5)
Plasma Buyer LLC+
Plasma Buyer LLC+(5)
Plasma Buyer LLC+(5)
Qgenda Intermediate Holdings, LLC+
Qgenda Intermediate Holdings, LLC#
Qgenda Intermediate Holdings, LLC+
Qgenda Intermediate Holdings, LLC#
Qgenda Intermediate Holdings, LLC+(5)
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Transaction Data Systems, Inc.*#+
Transaction Data Systems, Inc.+(5)
Veranex, Inc.+
Veranex, Inc.+(5)
Veranex, Inc.+(5)
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
(b)
(k)
(k)
(b)
(l)
(m)
(m)
(m)
(m)
(m)
(a)
(m)
(a)(b)
(a)(b)
(l)
(b)
(b)
(b)
(b)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(k)
(b)
(m)
L +
8.25%
SF + 5.75%
SF + 5.75%
SF + 5.75%
8.50%
L +
8.50%
L +
SF + 7.00%
SF + 7.00%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
SF + 5.75%
L +
5.75%
SF + 5.75%
5.50%
L +
5.50%
L +
5.50%
L +
SF + 5.75%
SF + 5.75%
SF + 5.75%
5.00%
L +
5.00%
L +
5.00%
L +
5.00%
L +
L +
5.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
SF + 8.00%
4.50%
L +
L +
4.50%
SF + 4.75%
P +
3.75%
SF + 4.75%
10.95%
8.78%
8.78%
N/A(6)
11.31%
N/A(6)
10.56%
N/A(6)
9.83%
9.83%
9.83%
9.84%
9.83%
8.31%
9.86%
8.31%
8.31%
N/A(6)
9.30%
N/A(6)
N/A(6)
8.67%
8.67%
8.67%
8.67%
N/A(6)
7.63%
7.63%
7.63%
7.63%
7.63%
7.63%
7.63%
7.63%
7.63%
7.63%
8.17%
N/A(6)
7.52%
N/A(6)
N/A(6)
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
3.50%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
Investment Type
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
See Notes to Consolidated Financial Statements.
188
Maturity
Date
09/2024
05/2028
05/2028
05/2028
02/2024
02/2024
03/2027
03/2027
08/2026
08/2026
08/2026
08/2026
08/2026
09/2025
08/2026
06/2025
06/2025
06/2025
05/2029
05/2028
05/2029
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
06/2025
02/2026
02/2026
04/2028
04/2028
04/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
374
5,248
10
—
8,619
—
7,549
—
6,186
2,949
1,943
1,355
635
13
132
3,931
1,917
—
5,403
—
—
14,968
12,194
1,455
973
—
10,386
10,110
6,661
1,713
1,523
1,142
952
761
152
80
66,280
—
3,178
—
—
373
5,199
10
(8)
8,644
—
7,493
(1)
6,161
2,919
1,929
1,336
631
12
130
3,970
1,909
(1)
5,301
(1)
(13)
14,968
12,120
1,449
973
—
10,215
9,614
6,404
1,686
1,482
1,124
937
749
149
80
65,504
(4)
3,149
—
(1)
178,792
176,591
— % $
0.2
—
—
0.3
—
0.3
—
0.2
0.1
0.1
0.1
—
—
—
0.2
0.1
—
0.2
—
—
0.6
0.5
—
—
—
0.4
0.4
0.3
0.1
0.1
—
—
—
—
—
2.6
—
0.1
—
—
6.9
370
5,143
9
(31)
8,619
—
7,549
—
6,025
2,872
1,892
1,320
618
11
128
3,891
1,899
(6)
5,295
(1)
(28)
14,668
11,950
1,425
953
(4)
10,386
10,110
6,661
1,713
1,523
1,142
952
761
152
80
64,955
(6)
3,146
(1)
(3)
176,138
TABLE OF CONTENTS
Hotels, Restaurants & Leisure
Barteca Restaurants, LLC#
Barteca Restaurants, LLC+(5)
Barteca Restaurants, LLC+(5)
BJH Holdings III Corp.*#+
BJH Holdings III Corp.+
Davidson Hotel Company, LLC+
Davidson Hotel Company, LLC+
Davidson Hotel Company, LLC+
EOS Fitness Opco Holdings, LLC*#+
EOS Fitness Opco Holdings, LLC+
EOS Fitness Opco Holdings, LLC+
EOS Fitness Opco Holdings, LLC+(5)
Freddy's Frozen Custard LLC+
Freddy's Frozen Custard LLC+(5)
Harri US LLC+
Harri US LLC+
Harri US LLC+(5)
Health Buyer, LLC+
Health Buyer, LLC+
SSRG Holdings, LLC+
SSRG Holdings, LLC+
Tropical Smoothie Cafe Holdings, LLC+
Tropical Smoothie Cafe Holdings, LLC*#
Tropical Smoothie Cafe Holdings, LLC#
Tropical Smoothie Cafe Holdings, LLC+(5)
Household Durables
Groundworks LLC+
Groundworks LLC+
Groundworks LLC+
Groundworks LLC+
Groundworks LLC+
Groundworks LLC+
Groundworks LLC+
Household Products
WU Holdco, Inc.#+
WU Holdco, Inc.+
WU Holdco, Inc.+
WU Holdco, Inc.+
Industrial Conglomerates
Arch Global CCT Holdings Corp.#+
Arch Global CCT Holdings Corp.+
Arch Global CCT Holdings Corp.+
Arch Global CCT Holdings Corp.+
Dwyer Instruments, Inc.+
Dwyer Instruments, Inc.+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
cash/
4.00%
PIK
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
SF + 6.00%
SF + 6.00%
SF + 6.00%
4.50%
L +
4.50%
L +
5.25%
L +
5.25%
L +
5.25%
L +
SF + 4.75%
SF + 4.75%
SF + 4.75%
SF + 4.75%
5.00%
L +
5.00%
L +
10.00%
10.00%
10.00%
L +
L +
L +
SF + 5.25%
SF + 5.25%
SF + 4.75%
SF + 4.75%
SF + 5.25%
SF + 5.25%
SF + 5.25%
SF + 4.25%
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.00%
5.50%
5.50%
5.50%
5.50%
4.75%
4.75%
4.75%
4.75%
6.00%
5.50%
(m)
(a)
(a)
(a)
(a)
(m)
(c)(m)
(c)(m)
(b)
(b)
(m)
(k)
(l)
(l)
(l)
(k)(l)
(k)(l)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)(c)
(a)
(b)
(b)
(b)
(c)
9.19%
N/A(6)
N/A(6)
7.58%
7.59%
8.37%
8.37%
N/A(6)
7.58%
7.58%
7.58%
N/A(6)
8.16%
N/A(6)
8.91%
N/A(6)
N/A(6)
7.98%
8.03%
8.45%
8.45%
7.98%
8.26%
8.01%
N/A(6)
7.81%
7.81%
7.81%
7.81%
7.08%
7.81%
N/A(6)
9.17%
9.17%
9.17%
8.11%
7.87%
8.42%
8.42%
N/A(6)
9.67%
8.38%
See Notes to Consolidated Financial Statements.
189
Maturity
Date
08/2028
08/2028
08/2028
08/2025
08/2025
07/2024
07/2024
07/2024
01/2026
01/2026
01/2026
01/2026
03/2027
03/2027
08/2026
08/2026
08/2026
04/2029
04/2028
11/2025
11/2025
09/2026
09/2026
09/2026
09/2026
01/2026
01/2026
01/2026
01/2026
01/2026
01/2026
01/2026
03/2026
03/2026
03/2026
03/2025
04/2026
04/2026
04/2026
04/2025
07/2027
07/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
7,679
—
—
50,571
70
7,096
1,092
—
9,393
896
8
—
9,160
—
804
—
—
2,604
2
1,000
20
19,950
13,695
5,830
—
7,604
(1)
(20)
51,317
66
7,080
1,090
—
9,401
897
8
(12)
9,093
(1)
720
—
(6)
2,567
2
990
20
19,767
13,553
5,773
(1)
129,870
129,907
4,615
1,805
1,203
1,072
82
56
—
8,833
3,743
1,318
342
26
5,429
2,355
135
76
—
3,922
7
4,569
1,786
1,193
1,060
82
52
—
8,742
3,790
1,318
340
25
5,473
2,401
134
75
—
3,847
6
0.3 % $
—
—
2.0
—
0.3
—
—
0.4
—
—
—
0.4
—
—
—
—
0.1
—
—
—
0.8
0.6
0.2
—
5.1
0.2
0.1
—
—
—
—
—
0.3
0.1
0.1
—
—
0.2
0.1
—
—
—
0.2
—
7,602
(1)
(20)
49,561
54
7,096
1,092
—
9,393
896
8
—
9,160
—
806
—
4
2,447
1
1,000
20
19,950
13,695
5,830
—
128,594
4,615
1,805
1,203
1,072
82
56
—
8,833
3,630
1,279
332
24
5,265
2,331
134
74
—
3,844
6
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Dwyer Instruments, Inc.+(5)
Essential Services Holdings Corporation+
Essential Services Holdings Corporation+(5)
Excelitas Technologies Corp.+
Excelitas Technologies Corp.+(8)(9)
Excelitas Technologies Corp.+
Excelitas Technologies Corp.+(5)
Madison Safety & Flow LLC+
Madison Safety & Flow LLC+
Specialty Measurement Bidco Limited+(8)(10)
Specialty Measurement Bidco Limited+(8)(9)(10)
Specialty Measurement Bidco Limited+(5)(8)(9)(10)
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
Spread
Above
Index
(1)
Interest
Rate
(2)
L +
L +
L +
SF +
E +
SF +
SF +
SF +
SF +
L +
6.00%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
3.60%
3.60%
5.75%
E +
5.75%
SN + 5.75%
(a)(b)
(l)
(e)
(l)
(k)
(k)(l)
(b)
(e)
N/A(6)
8.07%
N/A(6)
8.59%
6.08%
8.59%
N/A(6)
6.63%
6.64%
8.82%
6.75%
N/A(6)
Maturity
Date
07/2027
11/2026
11/2025
08/2029
08/2029
08/2028
08/2029
03/2025
03/2025
11/2027
11/2027
11/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
—
819
—
7,131
1,155
92
—
443
2
7,961
6,556
—
(9)
810
(1)
6,989
1,193
89
(13)
443
2
7,800
7,833
(39)
30,654
31,560
— % $
—
—
0.3
—
—
—
—
—
0.3
0.3
—
1.2
(10)
789
(2)
7,060
1,144
89
(14)
443
2
7,961
6,556
—
30,407
See Notes to Consolidated Financial Statements.
190
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Insurance
Alera Group, Inc.+
Alera Group, Inc.+
Alera Group, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+
AMBA Buyer, Inc.+(5)
Captive Resources Midco, LLC+
Captive Resources Midco, LLC+(5)
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
Integrity Marketing Acquisition, LLC+
J.S. Held Holdings, LLC#+
J.S. Held Holdings, LLC+
J.S. Held Holdings, LLC+
J.S. Held Holdings, LLC+
J.S. Held Holdings, LLC+
Keystone Agency Partners LLC+
Keystone Agency Partners LLC+
Keystone Agency Partners LLC+
Long Term Care Group, Inc.+
Majesco*#
Majesco+(5)
Norvax, LLC+
Norvax, LLC+
Pareto Health Intermediate Holdings, Inc.+
Patriot Growth Insurance Services, LLC+
Patriot Growth Insurance Services, LLC+(5)
Patriot Growth Insurance Services, LLC+
Patriot Growth Insurance Services, LLC+(5)
People Corporation+(8)(9)(12)
People Corporation+(8)(9)(12)
People Corporation+(8)(9)(12)
People Corporation+(8)(9)(12)
RSC Acquisition, Inc.*#+
RSC Acquisition, Inc.+
RSC Acquisition, Inc.+
RSC Acquisition, Inc.+(5)
RSC Acquisition, Inc.+(5)
RSC Acquisition, Inc.+
Sunstar Insurance Group, LLC+
Interest
Rate
(2)
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
One stop
Senior secured
Senior secured
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Spread
Above
Index
(1)
6.00% (l)
6.00% (k)(l)
6.00% (k)(l)
5.25% (l)(m)
5.25% (m)
5.25% (l)(m)
5.25%
5.25%
5.50% (k)
5.50%
5.50% (c)
5.75% (c)
5.75% (c)
5.75% (c)
5.75% (c)
5.75% (c)
5.50% (b)(c)
5.75%
5.75% (l)
5.50% (b)
5.50% (b)
5.50% (l)
5.50% (l)
4.50% (d)
6.00% (l)
6.00% (l)
6.00% (l)
6.00% (a)
7.25% (b)
7.25%
7.50% (b)
7.50% (b)
4.75% (c)
5.50% (b)
5.50%
5.50% (c)
5.75%
6.25% (h)
6.25% (h)
5.50% (h)
6.25% (h)
5.50% (l)
5.50% (l)
5.50% (l)
5.50%
5.50% (l)
5.50% (l)
6.00% (l)
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
L +
L +
SF +
SF +
P +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
C +
C +
C +
C +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
9.06%
9.06%
9.07%
9.33%
6.43%
9.33%
N/A(6)
N/A(6)
8.53%
N/A(6)
7.58%
7.83%
7.87%
7.40%
7.74%
8.85%
8.67%
N/A(6)
8.56%
9.17%
9.17%
9.20%
9.20%
10.75%
9.70%
9.70%
9.35%
8.82%
10.93%
N/A(6)
11.18%
11.18%
7.63%
8.65%
N/A(6)
9.31%
N/A(6)
9.87%
9.87%
9.13%
9.92%
8.31%
8.54%
9.05%
N/A(6)
9.20%
8.55%
9.69%
Maturity
Date
10/2028
10/2028
10/2028
07/2027
07/2027
07/2027
07/2027
07/2027
07/2029
07/2028
08/2025
08/2025
08/2025
08/2025
08/2025
08/2025
08/2025
08/2025
08/2025
07/2025
07/2025
07/2025
07/2025
07/2025
05/2027
05/2027
05/2027
09/2027
09/2027
09/2026
09/2025
09/2025
08/2025
10/2028
10/2028
10/2028
10/2028
02/2028
02/2028
02/2028
02/2027
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
25,370
7,210
463
3,188
950
790
—
—
9,813
—
3,046
2,421
1,517
774
468
244
184
—
1,117
6,422
1,478
1,430
77
48
2,850
182
160
2,984
18,751
—
32,784
9,925
7,225
9,491
—
617
—
13,502
4,406
3,166
147
25,637
6,561
1,519
—
90
995
773
25,153
7,117
458
3,163
946
783
—
—
9,624
(4)
3,007
2,414
1,497
768
465
242
183
—
1,082
6,402
1,458
1,406
72
45
2,810
180
146
2,935
18,522
(2)
32,498
9,765
7,174
9,409
(1)
591
(22)
14,537
4,874
3,354
158
25,306
6,293
1,506
(1)
47
986
764
% $
1.0
0.3
—
0.1
—
—
—
—
0.4
—
0.1
0.1
0.1
—
—
—
—
—
—
0.3
0.1
0.1
—
—
0.1
—
—
0.1
0.7
—
1.2
0.4
0.3
0.4
—
—
—
0.5
0.2
0.1
—
1.0
0.3
0.1
—
—
—
—
24,297
6,905
437
3,157
940
782
—
(1)
9,616
(4)
3,020
2,415
1,513
772
467
244
182
—
1,096
6,380
1,468
1,416
71
46
2,793
179
141
2,984
18,751
—
30,161
9,131
7,081
9,287
(1)
584
(22)
13,502
4,406
2,819
147
25,122
6,430
1,488
(2)
(2)
975
758
See Notes to Consolidated Financial Statements.
191
TABLE OF CONTENTS
Sunstar Insurance Group, LLC+
Sunstar Insurance Group, LLC+
Sunstar Insurance Group, LLC+
TigerRisk, LLC*+
TigerRisk, LLC+(5)
Internet & Catalog Retail
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+(5)
IT Services
Acquia, Inc.+
Acquia, Inc.+
CivicPlus, LLC+
CivicPlus, LLC+
CivicPlus, LLC+
CivicPlus, LLC+
CivicPlus, LLC+(5)
Critical Start, Inc.+
Critical Start, Inc.+(5)
Delinea Inc.+
Delinea Inc.#
Delinea Inc.+
Episerver, Inc.+
Episerver, Inc.+(8)(9)
Episerver, Inc.#+
Episerver, Inc.+
Episerver, Inc.+(5)
Episerver, Inc.+(5)
Goldcup 31018 AB+(8)(9)(17)
Goldcup 31018 AB+(5)(8)(9)(17)
Goldcup 31018 AB+(5)(8)(9)(17)
Infinisource, Inc.#+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+
Infinisource, Inc.+(5)
Infinisource, Inc.+
Netwrix Corporation+
Netwrix Corporation+(5)
Netwrix Corporation+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Interest
Rate
(2)
cash/
3.13%
PIK
cash/
3.82%
PIK
Investment Type
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
6.00%
6.00%
6.00%
4.75%
4.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
(l)
(l)
(l)
(a)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
7.00%
(a)
(b)(c)
7.00%
(a)
6.00%
(a)
6.00%
6.00%
(b)
11.75% (m)
6.00%
5.75%
5.75%
6.00%
6.00%
6.00%
5.75%
6.00%
5.75%
5.75%
5.75%
5.75%
7.07%
6.50%
6.50%
5.25%
5.25%
5.25%
5.25%
5.25%
5.25%
5.25%
5.25%
5.25%
5.00%
5.00%
5.00%
(k)
(a)
(a)
(a)
(b)
(e)
(b)
(b)
(f)
(c)
(c)
(c)
(c)
(b)
(c)
(b)
(b)
(l)
(l)
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
L +
SF +
SF +
L +
L +
L +
L +
E +
L +
L +
L +
L +
E +
E +
E +
L +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
9.69%
9.69%
9.65%
7.87%
N/A(6)
9.42%
9.42%
9.42%
9.42%
9.42%
9.42%
9.42%
N/A(6)
9.63%
10.18%
9.12%
9.12%
9.67%
14.38%
N/A(6)
5.65%
N/A(6)
9.12%
9.12%
9.12%
9.42%
7.19%
9.42%
9.42%
N/A(6)
N/A(6)
3.57%
N/A(6)
N/A(6)
8.13%
8.13%
8.13%
8.13%
8.92%
8.13%
8.92%
N/A(6)
8.92%
7.90%
N/A(6)
8.44%
Maturity
Date
10/2026
10/2026
10/2026
06/2027
06/2027
04/2027
04/2027
04/2027
04/2027
04/2027
04/2027
04/2027
04/2027
10/2025
10/2025
08/2027
08/2027
08/2027
06/2034
08/2027
05/2028
05/2028
03/2028
03/2028
03/2027
04/2026
04/2026
04/2026
04/2026
04/2026
04/2026
07/2029
01/2029
07/2029
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
10/2026
06/2029
06/2029
06/2029
See Notes to Consolidated Financial Statements.
192
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
$
$
791
392
2
22,662
—
232,622
784
387
2
22,485
(1)
231,767
15,012
8,786
4,357
2,624
1,691
397
228
—
33,095
9,578
23
6,174
3,646
2,894
202
—
3,251
—
16,581
9,586
118
21,494
17,564
11,937
6,601
—
—
7,666
—
—
27,812
8,403
2,026
303
213
105
57
—
86
3,534
—
129
14,899
8,720
4,324
2,605
1,677
395
226
(1)
32,845
9,509
22
6,109
3,612
2,863
197
(1)
3,221
(1)
16,388
9,471
116
21,261
20,276
12,007
6,520
(3)
(3)
7,736
(2)
(16)
27,484
8,334
1,991
301
212
105
47
(1)
75
3,503
(2)
121
— % $
—
—
0.9
—
8.9
0.6
0.3
0.2
0.1
0.1
—
—
—
1.3
0.4
—
0.3
0.2
0.1
—
—
0.1
—
0.6
0.4
—
0.8
0.7
0.5
0.2
—
—
0.3
—
—
1.1
0.3
0.1
—
—
—
—
—
—
0.1
—
—
Fair
Value
(4)
772
384
2
22,662
—
225,751
14,562
8,523
4,226
2,546
1,641
385
222
(8)
32,097
9,578
23
6,112
3,610
2,865
200
(1)
3,219
(1)
15,420
8,915
104
20,635
16,976
11,460
6,337
(22)
(20)
7,571
(2)
(16)
27,534
8,319
2,006
300
211
104
45
(2)
85
3,499
(2)
110
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
PCS Intermediate II Holdings, LLC+
PCS Intermediate II Holdings, LLC+
PCS Intermediate II Holdings, LLC+(5)
Recordxtechnologies, LLC#
Recordxtechnologies, LLC+
Recordxtechnologies, LLC+
Red Dawn SEI Buyer, Inc.+(8)(9)
Red Dawn SEI Buyer, Inc.+
Red Dawn SEI Buyer, Inc.+
Red Dawn SEI Buyer, Inc.+
Red Dawn SEI Buyer, Inc.+(5)
Red Dawn SEI Buyer, Inc.+(5)
Red Dawn SEI Buyer, Inc.+
ReliaQuest Holdings, LLC+
ReliaQuest Holdings, LLC+
ReliaQuest Holdings, LLC+(5)
Saturn Borrower Inc.+
Saturn Borrower Inc.+
Zarya Holdco, Inc.+
Zarya Holdco, Inc.+
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
L +
L +
L +
L +
L +
L +
SN +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
L +
L +
SF +
SF +
Spread
Above
Index
(1)
5.25%
5.25%
5.25%
5.50%
5.50%
5.50%
4.50%
4.50%
4.25%
(c)
(c)
(b)
(b)
(b)
(i)
(c)
(c)
(c)
4.25%
4.50%
4.25%
4.50%
10.75% (l)
10.75% (l)
(b)(c)
10.75%
6.50%
6.50%
6.50%
6.50%
(b)
(b)
(k)
Interest
Rate
(2)
8.62%
8.62%
N/A(6)
9.17%
9.17%
9.17%
6.69%
8.67%
8.42%
8.42%
N/A(6)
N/A(6)
8.67%
14.30%
14.30%
N/A(6)
10.17%
10.17%
9.63%
N/A(6)
Maturity
Date
01/2026
01/2026
01/2026
12/2025
12/2025
12/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
11/2025
10/2026
10/2026
10/2026
09/2026
09/2026
07/2027
07/2027
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
14,201
2,050
—
728
114
59
19,267
5,542
737
131
—
—
169
1,098
50
—
19,977
103
4,789
—
14,122
2,035
(1)
724
113
58
23,496
5,505
732
130
(2)
(1)
167
1,077
50
(2)
19,572
101
4,789
—
228,998
234,117
% $
0.6
0.1
—
—
—
—
0.7
0.2
—
—
—
—
—
—
—
—
0.7
—
0.2
—
8.7
14,201
2,050
—
699
109
55
18,882
5,431
717
127
(5)
(3)
166
1,098
50
—
18,978
98
4,789
—
222,614
See Notes to Consolidated Financial Statements.
193
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Leisure Products
WBZ Investment LLC#+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
Life Sciences Tools & Services
Covaris Intermediate 3, LLC+
Covaris Intermediate 3, LLC+
Covaris Intermediate 3, LLC+(5)
PAS Parent Inc.*#+
PAS Parent Inc.+
PAS Parent Inc.+(5)
Reaction Biology Corporation#
Reaction Biology Corporation+
Reaction Biology Corporation+(5)
Unchained Labs, LLC+
Unchained Labs, LLC+
Unchained Labs, LLC+
Machinery
Bad Boy Mowers Acquisition, LLC+
Blackbird Purchaser, Inc.*+
Blackbird Purchaser, Inc.+
Blackbird Purchaser, Inc.+(5)
Chase Industries, Inc.+(7)
Chase Industries, Inc.+(7)
Chase Industries, Inc.+(7)
Marine
Project Nike Purchaser, LLC+
Project Nike Purchaser, LLC+(5)
Project Nike Purchaser, LLC+(5)
Media
Triple Lift, Inc.+
Triple Lift, Inc.+
Triple Lift, Inc.+
Multiline Retail
Mills Fleet Farm Group LLC*#+
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Interest
Rate
(2)
cash/
cash/
cash/
cash/
1.00%
1.00%
1.00%
1.00%
PIK
PIK
PIK
PIK
Investment Type
Spread
Above
Index
(1)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
(b)(c)
(b)(c)
(b)(c)
(c)
(b)
(a)
(a)(b)
(a)(d)
(m)
(m)
(a)
(a)
(b)
(a)
(a)
(c)
(b)
(c)
(l)
L +
L +
L +
L +
L +
L +
L +
L +
6.25%
6.25%
6.25%
6.25%
6.25%
4.75%
5.25%
4.75%
5.50%
L +
4.50%
P +
L +
5.50%
SF + 5.25%
SF + 5.25%
P +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
4.25%
5.50%
5.50%
5.50%
4.25%
4.50%
4.50%
4.50%
7.00%
7.00%
7.00%
SF + 6.00%
5.00%
P +
P +
5.00%
SF + 5.50%
SF + 5.50%
(l)(m)
(m)
SF + 5.75%
(j)
8.13%
8.13%
8.13%
8.13%
N/A(6)
7.56%
8.37%
N/A(6)
8.62%
10.07%
N/A(6)
9.48%
9.48%
N/A(6)
8.62%
8.62%
N/A(6)
7.38%
7.62%
7.62%
N/A(6)
9.88%
10.67%
9.80%
9.55%
N/A(6)
N/A(6)
9.36%
9.61%
8.74%
Maturity
Date
09/2024
09/2024
09/2024
09/2024
09/2024
01/2028
01/2028
01/2028
12/2028
12/2027
12/2028
03/2029
03/2029
03/2029
08/2027
08/2027
08/2027
03/2028
04/2026
10/2025
04/2026
05/2025
05/2025
05/2025
04/2029
04/2029
04/2029
05/2028
05/2028
05/2028
$
$
8,649
1,239
861
444
—
8,679
1,235
875
452
—
11,193
11,241
5,909
18
—
33,706
161
—
8,023
60
—
999
844
—
5,856
18
(2)
33,102
153
(5)
7,949
55
(1)
972
830
—
49,720
48,927
1,866
19,084
58
—
12,059
985
350
34,402
19,000
—
—
19,000
5,343
1,133
27
6,503
1,862
19,205
57
(2)
12,117
1,005
350
34,594
18,822
(2)
(7)
18,813
5,258
1,112
26
6,396
One stop
L +
6.25%
(b)
9.06%
10/2024
45,138
45,090
See Notes to Consolidated Financial Statements.
194
% $
0.3
0.1
—
—
—
0.4
0.2
—
—
1.3
—
—
0.3
—
—
0.1
—
—
1.9
0.1
0.7
—
—
0.4
—
—
1.2
0.7
—
—
0.7
0.3
0.1
—
0.4
1.8
8,649
1,239
861
444
—
11,193
5,909
18
—
32,694
151
(8)
7,783
45
(5)
999
844
—
48,430
1,866
18,893
56
(3)
9,853
805
280
31,750
18,430
(8)
(23)
18,399
5,343
1,133
27
6,503
45,138
TABLE OF CONTENTS
Oil, Gas & Consumable Fuels
3ES Innovation, Inc.*+(8)(12)
3ES Innovation, Inc.+(8)(12)
Envernus, Inc.*#+
Envernus, Inc.+
Envernus, Inc.+
Envernus, Inc.+
Project Power Buyer, LLC*#+
Project Power Buyer, LLC+
Paper & Forest Products
Messenger, LLC#+
Messenger, LLC+
Messenger, LLC+
Messenger, LLC+
Personal Products
IMPLUS Footcare, LLC+
IMPLUS Footcare, LLC+
IMPLUS Footcare, LLC*+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
L +
L +
L +
L +
L +
L +
L +
L +
6.75%
6.75%
4.25%
4.50%
4.25%
4.50%
6.00%
6.00%
SF + 5.75%
SF + 5.75%
SF + 5.75%
4.75%
P +
L +
L +
L +
8.00%
8.00%
8.00%
(b)
(b)
(a)
(a)
(a)
(a)
(b)
(k)
(k)
(k)
(d)
(b)
(b)
(b)
9.70%
9.92%
7.37%
7.62%
7.37%
7.62%
9.68%
N/A(6)
8.88%
8.50%
8.88%
11.00%
11.42%
11.42%
11.42%
cash/
cash/
cash/
0.25%
0.25%
0.25%
PIK
PIK
PIK
Investment Type
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
See Notes to Consolidated Financial Statements.
195
Maturity
Date
05/2025
05/2025
07/2025
07/2025
09/2024
09/2024
05/2026
05/2025
12/2027
12/2027
12/2027
12/2027
04/2024
04/2024
04/2024
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
20,419
80
37,066
16,993
86
69
15,464
—
90,177
20,502
79
37,349
16,739
85
65
15,559
—
90,378
10,176
10,086
100
50
34
99
49
33
10,360
10,267
30,464
5,203
750
36,417
30,657
5,236
761
36,654
% $
0.8
—
1.4
0.7
—
—
0.6
—
3.5
0.4
—
—
—
0.4
1.1
0.2
—
1.3
20,419
80
36,097
16,653
82
67
15,464
—
88,862
10,176
100
50
34
10,360
28,332
4,839
698
33,869
TABLE OF CONTENTS
Pharmaceuticals
ACP Ulysses Buyer, Inc.*#+
ACP Ulysses Buyer, Inc.+
Amalthea Parent, Inc.*#+(8)(12)
Amalthea Parent, Inc.+(5)(8)(12)
Amalthea Parent, Inc.+(5)(8)(12)
Amalthea Parent, Inc.+(5)(8)(12)
Apothecary Products, LLC+
Apothecary Products, LLC+
Caerus Midco 3 S.A.R.L.+(8)(13)
Caerus Midco 3 S.A.R.L.+(5)(8)(13)
Caerus Midco 3 S.A.R.L.+(5)(8)(13)
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Spark Bidco Limited+(8)(9)(10)
Spark Bidco Limited+(8)(9)(10)
Spark Bidco Limited+(5)(8)(9)(10)
Professional Services
Citrin Cooperman Advisors LLC+
DISA Holdings Corp.+
DISA Holdings Corp.+
DISA Holdings Corp.+(5)
Eliassen Group, LLC+
Eliassen Group, LLC+
Filevine, Inc.+
Filevine, Inc.+
IG Investments Holdings, LLC+
IG Investments Holdings, LLC+(5)
NBG Acquisition Corp. and NBG-P Acquisition Corp.+
NBG Acquisition Corp. and NBG-P Acquisition Corp.+(5)
NBG Acquisition Corp. and NBG-P Acquisition Corp.+
NBG Acquisition Corp. and NBG-P Acquisition Corp.+(5)
Net Health Acquisition Corp.+
Net Health Acquisition Corp.*#
Net Health Acquisition Corp.+
Net Health Acquisition Corp.#
Net Health Acquisition Corp.*#
Net Health Acquisition Corp.+(5)
PlanSource Holdings, Inc.+
PlanSource Holdings, Inc.+
PlanSource Holdings, Inc.+
PlanSource Holdings, Inc.+(5)
ProcessMAP Corporation+
ProcessMAP Corporation+(5)
Procure Acquireco, Inc.#+
Procure Acquireco, Inc.+(5)
Investment Type
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
One stop
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
SF +
SF +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
SN +
SN +
SN +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
5.25%
5.25%
4.75%
4.75%
4.75%
4.75%
5.00%
5.00%
5.50%
5.50%
5.50%
5.25%
5.25%
5.25%
4.50%
4.50%
4.50%
5.00%
5.50%
5.50%
5.50%
5.75%
5.75%
6.50%
6.50%
6.00%
6.00%
5.25%
5.25%
5.25%
5.25%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
6.25%
6.25%
6.25%
6.25%
6.25%
6.00%
5.25%
5.25%
(l)
(l)
(a)
(m)
(l)
(m)
(a)
(a)
(a)
(i)
(i)
(k)(l)
(k)
(k)
(l)
(l)
(l)(m)
(a)(b)
(a)(b)
(b)
(a)
(a)
(a)
(a)
(a)
(c)
(c)
(c)
(b)
(c)
8.95%
8.95%
7.87%
N/A(6)
N/A(6)
N/A(6)
8.36%
8.58%
9.48%
N/A(6)
N/A(6)
8.37%
8.37%
8.37%
6.69%
6.69%
N/A(6)
7.80%
8.18%
8.18%
N/A(6)
9.30%
9.13%
5.43%
N/A(6)
9.47%
N/A(6)
8.06%
N/A(6)
8.10%
N/A(6)
8.87%
8.87%
8.87%
8.88%
8.87%
N/A(6)
9.55%
9.55%
9.55%
N/A(6)
6.17%
N/A(6)
8.00%
N/A(6)
cash/
2.50%
PIK
cash/
3.75%
PIK
See Notes to Consolidated Financial Statements.
196
Maturity
Date
02/2026
02/2026
03/2027
03/2027
03/2027
03/2027
07/2023
07/2023
05/2029
05/2029
05/2029
10/2028
10/2027
10/2028
08/2028
08/2028
02/2028
10/2027
09/2028
09/2028
09/2028
04/2028
04/2028
04/2027
04/2027
09/2028
09/2027
11/2028
11/2028
11/2028
11/2028
12/2025
12/2025
12/2025
12/2025
12/2025
12/2025
04/2025
04/2025
04/2025
04/2025
12/2027
12/2027
12/2028
12/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
25,488
1,102
57,245
—
—
—
2,891
156
17,179
—
—
10,627
36
3,240
21,890
2,653
—
25,285
1,081
56,732
(3)
(24)
(3)
2,921
156
16,853
(5)
(25)
10,445
34
3,177
26,631
3,004
(2)
142,507
146,257
2,996
2,273
2
—
1,444
4
5,265
—
7,093
—
7,593
—
75
—
13,235
8,378
6,706
4,237
1,171
—
11,416
1,932
139
—
3,948
—
17,634
—
2,945
2,228
2
(6)
1,431
4
5,197
—
6,976
(1)
7,543
(14)
74
(18)
13,147
8,380
6,741
4,198
1,172
(2)
11,465
1,920
138
(1)
3,914
—
17,477
(1)
% $
1.0
—
2.2
—
—
—
0.1
—
0.7
—
—
0.4
—
0.1
0.9
0.1
—
5.5
0.1
0.1
—
—
—
—
0.2
—
0.3
—
0.3
—
—
—
0.5
0.3
0.3
0.2
—
—
0.4
0.1
—
—
0.2
—
0.7
—
25,106
1,086
56,673
(3)
(17)
(3)
2,833
140
16,835
(5)
(52)
10,096
32
3,062
21,890
2,653
—
140,326
2,996
2,227
2
(6)
1,444
4
5,270
—
7,093
—
7,365
(66)
68
(75)
13,103
8,295
6,639
4,195
1,159
(3)
11,416
1,932
139
—
3,869
(1)
17,634
—
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Procure Acquireco, Inc.+(5)
Teaching Company, The*#+
Teaching Company, The+(5)
Real Estate Management & Development
Inhabit IQ Inc.+
Inhabit IQ Inc.#+
Inhabit IQ Inc.+
Inhabit IQ Inc.*
Inhabit IQ Inc.*#
Inhabit IQ Inc.+
Inhabit IQ Inc.#+
Inhabit IQ Inc.#+
Inhabit IQ Inc.#+
Inhabit IQ Inc.+
Inhabit IQ Inc.+
Inhabit IQ Inc.+
MRI Software LLC*+
MRI Software LLC+
MRI Software LLC+(5)
MRI Software LLC+(5)
RPL Bidco Limited+(8)(9)(10)
RPL Bidco Limited+(8)(9)(10)
RPL Bidco Limited+(5)(8)(9)(10)
Road & Rail
Channelside Acquisitona Co, Inc.+
Channelside Acquisitona Co, Inc.+
Channelside Acquisitona Co, Inc.+
Internet Truckstop Group LLC*#
Internet Truckstop Group LLC+
Internet Truckstop Group LLC+(5)
Interest
Rate
(2)
Investment Type
One stop
One stop
One stop
Spread
Above
Index
(1)
L +
L +
L +
5.25%
4.75%
4.75%
(a)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
SN +
A +
SN +
L +
L +
L +
L +
L +
L +
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75% (a)
5.75%
5.50% (b)
5.50% (b)
5.50%
5.50%
5.75% (i)
5.75% (g)
5.75%
5.25% (b)
5.25% (a)
5.25%
5.50% (b)
5.50% (b)
5.50%
N/A(6)
7.69%
N/A(6)
%
8.87%
8.87%
8.87%
8.87%
8.87%
8.87%
8.87%
8.87%
8.87%
8.87%
8.87%
N/A(6)
9.17%
9.17%
N/A(6)
N/A(6)
7.94%
8.21%
N/A(6)
8.92%
8.34%
N/A(6)
9.18%
9.18%
N/A(6)
Maturity
Date
12/2028
07/2023
07/2023
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
07/2025
02/2026
02/2026
02/2026
02/2026
08/2028
08/2028
02/2028
07/2028
07/2026
07/2028
04/2025
04/2025
04/2025
Principal ($) /
Shares
(3)
Amortized Cost
$
$
—
17,464
—
113,005
(3)
17,510
—
112,416
Percentage
of Net
Assets
% $
—
0.7
—
4.4
Fair
Value
(4)
—
17,289
(2)
111,986
21,751
19,437
13,391
12,367
6,518
3,176
1,395
1,181
1,164
931
491
—
14,360
4,952
—
—
16,305
1,912
—
21,595
19,478
13,280
12,278
6,548
3,213
1,410
1,193
1,178
927
497
—
14,279
4,905
(2)
(1)
20,039
2,172
—
0.9
0.8
0.5
0.5
0.3
0.1
0.1
—
—
—
—
—
0.6
0.2
—
—
0.6
0.1
—
21,751
19,437
13,391
12,367
6,518
3,176
1,395
1,181
1,164
931
491
—
14,216
4,903
(3)
(5)
15,653
1,836
(2)
119,331
122,989
4.7
118,400
4,241
5
—
21,564
9,442
—
35,252
4,154
4
—
21,843
9,355
(2)
35,354
0.2
—
—
0.8
0.4
—
1.4
4,199
5
—
21,564
9,442
—
35,210
See Notes to Consolidated Financial Statements.
197
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Software
Accela, Inc.*#+
Accela, Inc.+
Accela, Inc.+
Anaplan, Inc.+
Anaplan, Inc.+(5)
Appfire Technologies, LLC#+
Appfire Technologies, LLC+
Appfire Technologies, LLC+(5)
Appfire Technologies, LLC+(5)
Apptio, Inc.+
Apptio, Inc.+
Aras Corporation+
Aras Corporation+
Armstrong Bidco Limited+(8)(9)(10)
Armstrong Bidco Limited+(8)(9)(10)
Auvik Networks Inc.+(8)(12)
Auvik Networks Inc.+(8)(12)
Auvik Networks Inc.+(5)(8)(12)
Axiom Merger Sub Inc.+
Axiom Merger Sub Inc.+(8)(9)
Axiom Merger Sub Inc.+
Axiom Merger Sub Inc.+
Axiom Merger Sub Inc.+
Bayshore Intermediate #2, L.P.+
Bayshore Intermediate #2, L.P.+(5)
Bonterra LLC+
Bonterra LLC+
Bonterra LLC+(5)
Bottomline Technologies, Inc.+
Bottomline Technologies, Inc.+(5)
Bullhorn, Inc.*#+
Bullhorn, Inc.+(8)(9)
Bullhorn, Inc.+(8)(9)
Bullhorn, Inc.+
Bullhorn, Inc.+
Bullhorn, Inc.+
Bullhorn, Inc.+
Burning Glass Intermediate Holdings Company, Inc.#+
Burning Glass Intermediate Holdings Company, Inc.+
Calabrio, Inc.+
Calabrio, Inc.+(5)
Community Brands Parentco LLC+
Community Brands Parentco LLC+(5)
Community Brands Parentco LLC+(5)
Daxko Acquisition Corporation+
Daxko Acquisition Corporation+
Daxko Acquisition Corporation+(5)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
cash/
cash/
4.25%
4.25%
PIK
PIK
cash/
3.75%
PIK
cash/
cash/
2.75%
3.25%
PIK
PIK
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
L +
SN +
SN +
SF +
SF +
SF +
L +
E +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
L +
SN +
E +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
L +
L +
L +
7.50% (a)
7.50% (a)
7.00% (a)
6.50% (k)
6.50%
5.50% (k)
5.50% (k)
5.50%
5.00%
6.00% (b)
6.00% (b)
7.00% (b)
6.50% (c)
5.75% (i)
5.75% (i)
5.75% (l)
6.25% (l)
5.75%
5.50% (b)(c)
5.75% (e)(f)
5.50% (c)
5.50% (b)(c)
5.50%
7.75% (a)
6.75%
6.25% (b)
6.25% (b)
6.25%
5.50% (k)
5.50%
5.75% (b)
6.00% (i)
5.75% (e)
5.75% (b)
5.75% (b)
5.75% (b)
5.75% (b)
5.00% (a)
5.00% (a)
7.00% (b)
7.00%
5.75% (k)
5.50%
5.50%
5.50% (a)
5.50% (a)
5.50%
6.37%
6.37%
10.12%
9.53%
N/A(6)
8.63%
8.63%
N/A(6)
N/A(6)
8.46%
8.46%
5.71%
9.50%
7.94%
7.94%
5.73%
5.73%
N/A(6)
7.07%
5.85%
7.05%
8.87%
N/A(6)
10.43%
N/A(6)
9.92%
9.92%
N/A(6)
8.35%
N/A(6)
9.42%
8.19%
6.94%
9.42%
9.42%
9.42%
9.42%
8.12%
8.12%
10.67%
N/A(6)
8.88%
N/A(6)
N/A(6)
8.62%
8.62%
N/A(6)
$
09/2024
09/2024
09/2024
06/2029
06/2028
03/2027
03/2027
03/2027
03/2027
01/2025
01/2025
04/2027
04/2027
06/2029
06/2029
07/2027
07/2027
07/2027
04/2026
04/2026
04/2026
04/2026
10/2025
10/2028
10/2027
09/2027
09/2027
09/2027
05/2029
05/2028
09/2026
09/2026
09/2026
09/2026
09/2026
09/2026
09/2026
06/2028
06/2026
04/2027
04/2027
02/2028
02/2028
02/2028
10/2028
10/2028
10/2027
$
4,695
279
20
9,840
—
36,575
19
—
—
57,010
76
14,159
31
3,199
550
7,033
1,251
—
5,728
2,075
272
15
—
65,064
—
63,832
122
—
28,163
—
65,946
10,681
4,236
214
96
76
110
9,819
28
53,683
—
14,194
—
—
27,710
2,337
—
4,678
277
20
9,745
(2)
36,151
16
(7)
(39)
57,389
76
14,055
30
3,407
539
6,978
1,239
(1)
5,753
2,375
270
14
—
63,909
(3)
63,041
120
(36)
27,631
(4)
65,212
11,636
4,672
211
95
76
107
9,658
26
53,073
(3)
13,939
(1)
(1)
27,471
2,307
(2)
0.2 % $
—
—
0.4
—
1.4
—
—
—
2.2
—
0.6
—
0.1
—
0.3
—
—
0.2
0.1
—
—
—
2.6
—
2.5
—
—
1.1
—
2.6
0.4
0.2
—
—
—
—
0.4
—
2.1
—
0.5
—
—
1.1
0.1
—
4,695
279
20
9,643
(3)
36,209
17
(11)
(55)
56,440
76
14,159
31
3,103
500
6,829
1,239
(2)
5,728
2,075
272
15
—
65,064
—
63,194
120
(58)
27,318
(6)
65,946
10,681
4,236
214
96
76
110
9,819
28
53,683
—
13,911
(1)
(2)
26,879
2,267
(5)
See Notes to Consolidated Financial Statements.
198
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Daxko Acquisition Corporation+(5)
Diligent Corporation*#+
Diligent Corporation+
Diligent Corporation+
Dragon UK Bidco Limited+(8)(9)(10)
Dragon UK Bidco Limited+(8)(9)(10)
Dragon UK Bidco Limited+(5)(8)(9)(10)
FirstUp, Inc.+
FirstUp, Inc.+(5)
Gainsight, Inc.+
Gainsight, Inc.+(5)
GS Acquisitionco, Inc.*#+
GS Acquisitionco, Inc.+
GS Acquisitionco, Inc.+(5)
GTIV, LLC+
GTIV, LLC+(5)
GTY Technology Holdings, Inc.+
GTY Technology Holdings, Inc.+(5)
GTY Technology Holdings, Inc.+(5)
ICIMS, Inc.+
ICIMS, Inc.+(5)
ICIMS, Inc.+
IQN Holding Corp. #+
IQN Holding Corp. +(5)
IQN Holding Corp. +(5)
Island Bidco AB+(8)(9)(17)
Island Bidco AB+(8)(17)
Island Bidco AB+(8)(17)
Island Bidco AB+(5)(8)(9)(17)
Juvare, LLC*
Juvare, LLC+
Juvare, LLC+
Juvare, LLC+
Kaseya Inc.+
Kaseya Inc.+(5)
Kaseya Inc.+(5)
Mindbody, Inc.+
Mindbody, Inc.+
Mindbody, Inc.+
Ministry Brands Holdings LLC+
Ministry Brands Holdings LLC+(5)
Ministry Brands Holdings LLC+(5)
Neo Bidco GMBH+(8)(9)(13)
Neo Bidco GMBH+(8)(13)
Neo Bidco GMBH+(8)(9)(13)
Newscycle Solutions, Inc.+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
L +
L +
L +
L +
SN +
C +
SN +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
SF +
E +
SF +
SF +
E +
L +
L +
L +
L +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
E +
L +
E +
L +
5.50%
6.25% (c)
5.75% (c)
6.25% (c)
6.00% (i)
6.00% (h)
6.00%
6.75% (b)
9.75%
6.75% (b)
6.75%
5.75% (b)(c)
5.75% (c)
5.75%
5.25% (m)
5.25%
6.88% (l)
6.88%
6.88%
6.75% (l)
6.75%
6.75%
5.50% (l)
5.50%
5.50%
7.25% (f)
7.00% (m)
6.50%
6.50%
6.25% (b)
6.25% (b)
6.25% (b)
6.25% (b)
5.75% (m)
5.75%
5.75%
8.50% (b)
8.50% (b)
8.00%
5.50% (b)
5.50%
5.50%
6.00% (e)
6.00% (b)
6.00%
7.00% (b)
N/A(6)
9.13%
8.63%
8.49%
8.19%
10.20%
N/A(6)
6.92%
N/A(6)
9.56%
N/A(6)
9.85%
9.46%
N/A(6)
8.36%
N/A(6)
9.81%
N/A(6)
N/A(6)
9.49%
N/A(6)
N/A(6)
8.41%
N/A(6)
N/A(6)
0.23%
6.09%
N/A(6)
N/A(6)
9.92%
9.92%
9.92%
9.92%
8.29%
N/A(6)
N/A(6)
10.64%
10.64%
N/A(6)
9.17%
N/A(6)
N/A(6)
6.00%
9.29%
N/A(6)
10.67%
cash/
3.50%
PIK
PIK
cash/
0.63%
PIK
cash/
cash/
7.25%
3.50%
PIK
PIK
cash/
cash/
1.50%
1.50%
PIK
PIK
$
Maturity
Date
10/2028
08/2025
08/2025
08/2025
02/2029
02/2029
02/2029
07/2027
07/2027
07/2027
07/2027
05/2026
05/2026
05/2026
02/2029
02/2029
07/2029
07/2029
07/2029
08/2028
08/2028
08/2028
05/2029
05/2028
05/2029
07/2028
07/2028
07/2028
07/2028
10/2026
10/2026
10/2026
04/2026
06/2029
06/2029
06/2029
02/2025
02/2025
02/2025
12/2028
12/2027
12/2028
07/2028
01/2028
01/2028
12/2022
See Notes to Consolidated Financial Statements.
199
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
—
86,292
5,964
162
12,937
277
—
8,916
—
9,948
—
84,289
186
—
74,215
—
3,100
—
—
7,775
—
—
14,682
—
—
5,318
2,921
—
—
7,526
1,737
548
45
9,178
—
—
50,096
5,610
—
21,981
—
—
6,408
59
—
109
(10)
86,221
5,925
161
15,067
293
—
8,848
(1)
9,815
(2)
84,506
184
(4)
73,541
(2)
3,041
(2)
(23)
7,640
(1)
—
14,544
(1)
(31)
5,603
2,893
—
(1)
7,462
1,722
525
45
9,044
(3)
(5)
50,522
5,570
—
21,785
(2)
(5)
7,633
59
—
109
— % $
3.4
0.2
—
0.5
—
—
0.4
—
0.4
—
3.2
—
—
2.9
—
0.1
—
—
0.3
—
—
0.6
—
—
0.2
0.1
—
—
0.3
0.1
—
—
0.4
—
—
2.0
0.2
—
0.8
—
—
0.2
—
—
—
(33)
85,426
5,832
158
12,161
261
(6)
8,916
—
9,847
(1)
82,603
180
(40)
72,731
(5)
3,069
(1)
(24)
7,707
(1)
—
14,535
(1)
(3)
5,265
2,892
—
(1)
7,451
1,719
526
45
8,994
(5)
(11)
50,096
5,610
—
21,322
(5)
(18)
6,216
58
—
109
TABLE OF CONTENTS
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+
PDI TA Holdings, Inc.+(8)(9)
PDI TA Holdings, Inc.+
Personify, Inc.*#+
Personify, Inc.#
Personify, Inc.+
Pluralsight, LLC+
Pluralsight, LLC+(5)
ProcessUnity Holdings, LLC+
ProcessUnity Holdings, LLC+
ProcessUnity Holdings, LLC+(5)
Pyramid Healthcare Acquisition Corp.#+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+
Pyramid Healthcare Acquisition Corp.+(5)
QAD, Inc.+
QAD, Inc.+(5)
Quant Buyer, Inc.+
Quant Buyer, Inc.+
Quant Buyer, Inc.+(5)
Quant Buyer, Inc.+
Quant Buyer, Inc.+
Rainforest Bidco Limited+(8)(9)(10)
Rainforest Bidco Limited+(8)(9)(10)
Rainforest Bidco Limited+(5)(8)(9)(10)
RegEd Aquireco, LLC+
RegEd Aquireco, LLC+
Riskonnect Parent, LLC*+
Riskonnect Parent, LLC+(5)
Riskonnect Parent, LLC+(5)
Rodeo Buyer Company & Absorb Software Inc.+
Rodeo Buyer Company & Absorb Software Inc.+(5)
SailPoint Technologies Holdings, Inc.+
SailPoint Technologies Holdings, Inc.+(5)
Sapphire Bidco Oy+(8)(9)(16)
Sonatype, Inc.+
Investment Type
One stop
Second lien
One stop
One stop
Second lien
Second lien
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Spread
Above
Index
(1)
Interest
Rate
(2)
L +
L +
L +
L +
L +
L +
SN +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
SF +
SF +
SF +
SF +
SF +
SN +
SN +
SN +
L +
L +
SF +
SF +
SF +
L +
L +
SF +
SF +
E +
SF +
4.50% (b)
8.50% (b)
4.50% (b)(c)
4.50% (b)
8.50% (b)
8.50% (b)
4.50% (i)
4.50% (b)
5.25% (b)
5.25% (b)
5.25%
8.00% (a)
8.00%
6.00% (b)
6.00% (a)
6.00%
4.75% (b)(c)
4.75% (b)
4.75% (a)
4.75% (b)
4.75% (b)
4.75% (b)
4.75% (b)
4.75% (a)
4.75% (b)
4.75%
6.00% (a)
6.00%
5.50% (l)
5.50% (l)
5.50%
6.00% (l)
6.00%
5.75% (i)
5.75%
5.75%
4.25% (b)
4.25% (b)(d)
5.50% (m)
5.50%
5.50%
6.25% (a)
6.25%
6.25% (k)
6.25%
6.00% (e)
6.75% (k)
7.16%
11.49%
6.98%
7.16%
11.49%
11.49%
6.81%
7.16%
8.92%
8.92%
N/A(6)
10.68%
N/A(6)
9.67%
9.11%
N/A(6)
7.56%
7.91%
7.30%
7.56%
7.56%
8.42%
7.82%
7.87%
7.56%
N/A(6)
9.12%
N/A(6)
8.47%
8.47%
N/A(6)
8.97%
N/A(6)
7.94%
N/A(6)
N/A(6)
7.06%
7.87%
9.73%
N/A(6)
N/A(6)
9.37%
N/A(6)
9.10%
N/A(6)
6.00%
9.47%
See Notes to Consolidated Financial Statements.
200
$
Maturity
Date
10/2024
10/2025
10/2024
10/2024
10/2025
10/2025
10/2024
10/2024
09/2024
09/2024
09/2024
03/2027
03/2027
09/2028
09/2028
09/2028
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
05/2027
11/2027
11/2027
06/2029
06/2029
06/2029
06/2029
06/2029
07/2029
01/2029
07/2029
12/2024
12/2024
12/2028
12/2028
12/2028
05/2027
05/2027
08/2029
08/2028
04/2029
12/2025
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
8,409
3,424
1,119
690
640
377
78
40
13,723
8,173
—
23,748
—
4,221
23
—
18,372
873
539
179
158
148
148
100
58
—
9,488
—
2,491
2,957
—
2,027
—
6,546
—
—
11,183
236
10,109
—
—
4,541
—
9,827
—
30,114
40,459
8,329
3,375
1,114
685
637
375
94
40
13,851
8,126
—
23,567
(1)
4,184
22
(7)
18,230
866
535
178
157
147
147
68
58
(2)
9,407
(4)
2,468
2,929
(1)
2,007
—
6,795
—
(26)
11,188
235
10,020
(3)
(7)
4,506
(1)
9,633
(2)
30,386
40,211
0.3 % $
0.1
—
—
—
—
—
—
0.5
0.3
—
0.9
—
0.2
—
—
0.7
—
—
—
—
—
—
—
—
—
0.4
—
0.1
0.1
—
0.1
—
0.3
—
—
0.4
—
0.4
—
—
0.2
—
0.4
—
1.2
1.6
8,241
3,424
1,096
676
640
377
76
37
13,723
8,173
—
23,748
—
4,221
23
—
18,372
873
539
179
158
148
148
100
58
—
9,298
(9)
2,405
2,855
(5)
2,006
—
6,456
—
(26)
10,401
220
10,008
(4)
(8)
4,541
—
9,729
(2)
29,813
40,459
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Sonatype, Inc.+
Sonatype, Inc.+(5)
Spartan Buyer Acquisition Co.*#+
Spartan Buyer Acquisition Co.+
Spartan Buyer Acquisition Co.+
Tahoe Bidco B.V. +
Tahoe Bidco B.V. +(5)
Telesoft Holdings LLC+
Telesoft Holdings LLC+(5)
Telesoft Holdings LLC+
Templafy APS and Templafy, LLC+(8)(18)
Templafy APS and Templafy, LLC+(8)(18)
Templafy APS and Templafy, LLC+(5)(8)(18)
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
TI Intermediate Holdings, LLC+
Togetherwork Holdings, LLC*#
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC#+
Togetherwork Holdings, LLC*#
Togetherwork Holdings, LLC#+
Togetherwork Holdings, LLC*+
Togetherwork Holdings, LLC#+
Togetherwork Holdings, LLC*#
Togetherwork Holdings, LLC#+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+
Togetherwork Holdings, LLC+(5)
Togetherwork Holdings, LLC+
Trintech, Inc.*#+
Trintech, Inc.#+
Trintech, Inc.+
Vector CS Midco Limited & Cloudsense Ltd.+(8)(9)(10)
Vector CS Midco Limited & Cloudsense Ltd.+(8)(9)(10)
Vendavo, Inc.*#+
Vendavo, Inc.+
WebPT, Inc.+
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
SF +
L +
L +
P +
L +
L +
L +
L +
L +
SF +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
N/A
N/A
L +
P +
L +
6.75% (k)
6.75%
6.25% (a)
6.25% (a)
5.25% (d)
6.00% (a)
6.00%
5.75% (b)(c)
5.75%
6.25% (b)
6.50% (m)
6.50%
6.50%
4.25% (a)
4.25% (a)
4.25% (a)
4.50% (a)
4.50% (a)
4.25% (a)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25% (c)
6.25%
6.25% (c)
6.00% (a)
6.00% (a)
6.00% (a)
5.75% (b)
4.75% (d)
6.75% (b)
9.47%
N/A(6)
9.37%
9.37%
11.50%
8.68%
N/A(6)
8.61%
N/A(6)
9.03%
9.64%
N/A(6)
N/A(6)
7.37%
7.37%
7.37%
7.62%
7.62%
7.37%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
9.13%
N/A(6)
9.55%
9.12%
9.12%
9.12%
4.50%
4.50%
8.99%
11.00%
9.82%
cash/
cash/
4.70%
4.70%
PIK
PIK
See Notes to Consolidated Financial Statements.
201
$
Maturity
Date
12/2025
12/2025
12/2026
12/2026
12/2026
09/2028
10/2027
12/2025
12/2025
08/2028
07/2028
07/2028
07/2028
12/2024
12/2024
12/2024
12/2024
12/2024
12/2024
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2025
03/2024
03/2025
12/2024
12/2024
12/2024
05/2024
05/2024
09/2027
09/2027
01/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
851
—
31,358
1,993
48
12,058
—
886
—
65
3,171
—
—
3,445
910
428
233
157
17
15,245
6,893
4,181
1,767
1,715
1,671
1,614
1,555
1,450
1,188
654
453
438
250
63
58
—
1,339
22,029
9,140
100
7,416
122
19,611
40
626
846
(1)
31,083
1,961
46
11,955
(1)
876
(1)
64
3,088
—
(17)
3,470
898
422
227
156
17
15,300
6,810
4,151
1,799
1,743
1,701
1,630
1,584
1,475
1,196
666
449
435
248
64
59
(1)
1,327
22,121
9,218
100
8,529
142
19,468
39
617
— % $
—
1.2
0.1
—
0.5
—
—
—
—
0.1
—
—
0.1
—
—
—
—
—
0.6
0.3
0.2
0.1
0.1
0.1
0.1
0.1
0.1
—
—
—
—
—
—
—
—
0.1
0.9
0.4
—
0.3
—
0.7
—
—
851
—
30,730
1,953
43
12,058
—
871
(2)
64
3,082
—
(18)
3,427
906
426
233
157
17
15,245
6,893
4,181
1,767
1,715
1,671
1,614
1,555
1,450
1,188
654
453
438
250
63
58
—
1,339
21,809
9,050
98
6,525
106
18,826
34
620
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Workforce Software, LLC+
Workforce Software, LLC+
Workforce Software, LLC+
Workforce Software, LLC+
Workforce Software, LLC+
Investment Type
One stop
One stop
One stop
One stop
One stop
Spread
Above
Index
(1)
7.25% (b)
7.25% (b)
7.25% (b)
6.50% (b)
7.25% (b)
L +
L +
L +
L +
L +
Interest
Rate
(2)
7.32%
7.32%
7.32%
9.57%
7.32%
cash/
cash/
cash/
3.00%
3.00%
3.00%
PIK
PIK
PIK
cash/
3.00%
PIK
Maturity
Date
07/2025
07/2025
07/2025
07/2025
07/2025
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
28,178
$
28,542
1.1 % $
28,178
4,986
3,532
118
69
4,954
3,477
116
68
1,316,756
1,316,394
0.2
0.1
—
—
51.1
4,986
3,532
118
69
1,300,853
See Notes to Consolidated Financial Statements.
202
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Specialty Retail
Ave Holdings III, Corp*+
Ave Holdings III, Corp+
Ave Holdings III, Corp+
Batteries Plus Holding Corporation*#
Batteries Plus Holding Corporation+
Batteries Plus Holding Corporation+
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(8)(9)(10)
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(8)(10)
Consilio Midco Limited+(5)(8)(10)
Consilio Midco Limited+(8)(9)(10)
Consilio Midco Limited+(8)(10)
Cycle Gear, Inc.*#+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.#
Imperial Optical Midco Inc.#
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.*+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.#+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.#+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.*+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF +
P +
SF +
L +
L +
L +
SF +
SF +
E +
SF +
SF +
SF +
SF +
E +
SF +
SF +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
5.50%
4.50%
5.50%
6.75%
6.75%
6.75%
5.75%
5.75%
6.25%
5.75%
5.75%
5.75%
5.75%
6.25%
5.75%
5.50%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
(l)
(d)
(l)
(a)
(a)
(a)(d)
(l)
(l)
(e)
(l)
(l)
(l)
(e)
(l)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
9.20%
10.75%
8.71%
9.87%
9.87%
9.93%
9.45%
9.45%
7.48%
9.45%
9.45%
9.45%
N/A(6)
7.48%
N/A(6)
9.20%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
Maturity
Date
02/2028
02/2028
02/2028
06/2023
06/2023
06/2023
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
05/2028
01/2026
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
25,896
14
103
21,921
1,420
145
11,538
9,975
8,342
2,158
1,435
734
—
35
—
48,851
20,664
4,767
4,149
3,590
2,798
2,763
2,238
2,058
1,903
1,654
1,454
1,435
1,390
1,369
1,238
1,145
1,128
967
879
660
632
625
554
502
499
486
477
459
454
450
446
25,427
12
91
21,921
1,417
145
11,351
9,880
9,483
2,123
1,421
716
(2)
34
—
48,738
20,597
4,746
4,131
3,604
2,792
2,751
2,229
2,049
1,918
1,647
1,448
1,429
1,384
1,363
1,248
1,140
1,137
963
875
657
629
622
552
499
497
484
475
454
452
448
444
% $
1.0
—
—
0.9
0.1
—
0.5
0.4
0.4
0.1
0.1
0.1
—
—
—
1.9
0.8
0.2
0.2
0.2
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
0.1
—
0.1
0.1
0.1
—
—
—
—
—
—
—
—
—
—
—
—
—
25,119
10
67
21,921
1,420
145
11,192
9,676
8,271
2,093
1,392
712
(3)
33
—
47,874
20,664
4,767
4,149
3,590
2,798
2,763
2,238
2,058
1,903
1,654
1,454
1,435
1,390
1,369
1,238
1,145
1,128
967
879
660
632
625
554
502
499
486
477
459
454
450
446
See Notes to Consolidated Financial Statements.
203
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+(5)
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
N/A(6)
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
$
Maturity
Date
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
442
416
415
414
410
410
380
358
357
353
327
314
—
306
284
277
277
272
269
257
257
239
238
219
218
215
209
195
193
192
188
179
172
167
165
161
160
158
153
152
143
143
138
133
131
131
129
127
440
414
413
412
408
408
379
357
356
351
327
312
(46)
304
283
275
276
271
268
256
256
238
238
218
217
214
208
194
192
191
188
178
171
167
164
160
159
158
152
151
143
142
137
132
131
131
128
127
— % $
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
442
416
415
414
410
410
380
358
357
353
327
314
—
306
284
277
277
272
269
257
257
239
238
219
218
215
209
195
193
192
188
179
172
167
165
161
160
158
153
152
143
143
138
133
131
131
129
127
See Notes to Consolidated Financial Statements.
204
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
$
Maturity
Date
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
124
114
114
114
112
109
106
105
105
105
99
96
86
86
82
79
79
75
75
75
75
74
74
71
68
68
65
64
63
62
60
59
56
55
54
52
47
42
41
40
39
36
34
35
35
34
33
31
29
124
113
114
114
111
109
106
105
104
104
99
95
85
85
82
79
78
75
75
75
75
74
73
71
68
68
65
63
62
61
60
59
55
55
54
52
47
42
41
40
38
35
34
34
35
34
32
31
29
— % $
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
124
114
114
114
112
109
106
105
105
105
99
96
86
86
82
79
79
75
75
75
75
74
74
71
68
68
65
64
63
62
60
59
56
55
54
52
47
42
41
40
39
36
34
35
35
34
33
31
29
See Notes to Consolidated Financial Statements.
205
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
$
Maturity
Date
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
29
29
28
27
27
26
26
25
25
24
23
23
21
19
19
19
19
19
18
17
17
17
16
15
14
13
13
13
13
13
13
12
11
11
10
10
10
10
9
9
9
9
8
8
8
8
7
6
6
29
29
27
27
26
26
26
25
25
24
23
23
21
19
19
19
19
19
18
17
17
17
16
15
14
12
13
13
13
13
13
11
11
11
10
10
10
10
9
9
9
9
8
8
8
8
7
6
6
— % $
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
29
29
28
27
27
26
26
25
25
24
23
23
21
19
19
19
19
19
18
17
17
17
16
15
14
13
13
13
13
13
13
12
11
11
10
10
10
10
9
9
9
9
8
8
8
8
7
6
6
See Notes to Consolidated Financial Statements.
206
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Jet Equipment & Tools Ltd.+(8)(9)(12)
Jet Equipment & Tools Ltd.*#(8)(12)
Jet Equipment & Tools Ltd.+(8)(12)
Jet Equipment & Tools Ltd.+(8)(9)(12)
Jet Equipment & Tools Ltd.#+(8)(12)
Jet Equipment & Tools Ltd.+(8)(12)
Jet Equipment & Tools Ltd.+(8)(12)
Jet Equipment & Tools Ltd.+(8)(9)(12)
Jet Equipment & Tools Ltd.+(8)(9)(12)
Jet Equipment & Tools Ltd.+(8)(12)
PPV Intermediate Holdings, LLC+
PPV Intermediate Holdings, LLC+
PPV Intermediate Holdings, LLC+(5)
PPV Intermediate Holdings, LLC+(5)
PPV Intermediate Holdings, LLC+(5)
Salon Lofts Group, LLC+
Salon Lofts Group, LLC+(5)
Salon Lofts Group, LLC+(5)
Sola Franchise, LLC and Sola Salon Studios, LLC#+
Sola Franchise, LLC and Sola Salon Studios, LLC#+
Sola Franchise, LLC and Sola Salon Studios, LLC+
Titan Fitness, LLC*#+
Titan Fitness, LLC+
Titan Fitness, LLC+
Vermont Aus Pty Ltd+(8)(11)
Vermont Aus Pty Ltd+(8)(9)(11)
VSG Acquisition Corp. and Sherrill, Inc.+
VSG Acquisition Corp. and Sherrill, Inc.+
VSG Acquisition Corp. and Sherrill, Inc.+
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
L +
L +
L +
L +
L +
L +
C +
SF +
SF +
C +
SF +
SF +
SF +
CP +
C +
SF +
SF +
N/A
SF +
SF +
N/A
SF +
SF +
SF +
SF +
SF +
SF +
L +
L +
L +
SF +
A +
SF +
P +
L +
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
6.75%
5.75%
5.75%
6.00%
6.00%
5.75%
5.75%
5.75%
4.75%
6.00%
6.50%
5.75%
5.75%
5.75%
5.75%
5.75%
5.75%
4.75%
4.75%
4.75%
6.75%
6.75%
6.75%
5.50%
5.75%
5.50%
4.50%
5.50%
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(h)
(l)
(l)
(h)
(l)
(l)
(d)(k)
(n)
(h)
(l)
(l)(m)
(l)
(l)
(l)
(a)(b)
(b)
(b)
(l)
(g)
(l)
(d)
(b)
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.87%
9.92%
9.45%
9.70%
10.17%
9.45%
9.45%
9.82%
10.20%
10.17%
10.20%
9.29%
13.00%
N/A(6)
N/A(6)
13.00%
9.30%
N/A(6)
N/A(6)
8.45%
8.45%
N/A(6)
7.56%
7.00%
7.00%
9.20%
8.86%
9.31%
10.75%
9.31%
cash/
cash/
cash/
2.00%
2.00%
2.00%
PIK
PIK
PIK
$
Maturity
Date
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
08/2023
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
11/2024
08/2029
08/2030
08/2029
08/2029
08/2030
08/2028
08/2028
08/2028
10/2024
10/2024
10/2024
02/2025
02/2025
02/2025
03/2028
03/2028
04/2028
04/2028
04/2028
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
5
5
3
386
170
58
38
26
17
16,781
12,113
5,307
4,917
4,219
1,550
310
39
2,121
1,035
7,738
918
—
—
—
3,576
—
—
11,850
1,674
—
30,810
1,918
490
8,342
7,286
8,308
69
7
5
5
3
384
169
57
38
26
16
17,761
12,223
5,265
5,120
4,252
1,542
310
43
2,269
1,014
7,590
896
(8)
(23)
(3)
3,541
(2)
(18)
11,821
1,702
—
30,991
1,908
487
8,228
8,376
8,193
67
2
— % $
—
—
—
—
—
—
—
—
0.6
0.5
0.2
0.2
0.2
0.1
—
—
0.1
0.1
0.3
—
—
—
—
0.1
—
—
0.5
0.1
—
1.1
0.1
—
0.3
0.3
0.3
—
—
5
5
3
386
170
58
38
26
17
16,381
11,824
5,205
4,822
4,118
1,513
302
38
2,080
1,025
7,583
895
(8)
(19)
(4)
3,540
(2)
(18)
11,850
1,674
—
28,958
1,803
458
8,342
7,286
8,225
68
4
344,146
346,216
13.3
338,066
See Notes to Consolidated Financial Statements.
207
TABLE OF CONTENTS
Technology Hardware, Storage & Peripherals
Agility Recovery Solutions Inc.*#+
Agility Recovery Solutions Inc.+
Textiles, Apparel & Luxury Goods
Dollfus Mieg Company, Inc.+(8)(10)
Dollfus Mieg Company, Inc.+(8)(10)
Dollfus Mieg Company, Inc.+(8)(10)
Dollfus Mieg Company, Inc.+(5)(8)(9)(10)
Elite Sportswear, L.P.+
Elite Sportswear, L.P.+
Elite Sportswear, L.P.+
Elite Sportswear, L.P.+(5)
Elite Sportswear, L.P.*+
Elite Sportswear, L.P.+
Elite Sportswear, L.P.*+
Elite Sportswear, L.P.+
Georgica Pine Clothiers, LLC#+
Georgica Pine Clothiers, LLC*#
Georgica Pine Clothiers, LLC+
Georgica Pine Clothiers, LLC#+
Georgica Pine Clothiers, LLC*#
Georgica Pine Clothiers, LLC+
QF Holdings, Inc.+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
SHO Holding I Corporation+
Trading Companies and Distributors
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+
Marcone Yellowstone Buyer Inc.+
Water Utilities
S.J. Electro Systems, LLC+
S.J. Electro Systems, LLC+
S.J. Electro Systems, LLC+
Vessco Midco Holdings, LLC+
Vessco Midco Holdings, LLC+
Vessco Midco Holdings, LLC+
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
One stop
One stop
L +
L +
6.75%
6.75%
(b)
(b)(d)
9.67%
9.91%
cash/
cash/
0.75%
0.75%
PIK
PIK
cash/
cash/
cash/
cash/
cash/
cash/
cash/
cash/
1.50%
1.50%
1.50%
1.50%
1.50%
1.50%
1.50%
1.50%
PIK
PIK
PIK
PIK
PIK
PIK
PIK
PIK
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
One stop
One stop
One stop
One stop
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
Senior secured
L +
L +
L +
E +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
L +
P +
6.00%
6.00%
6.00%
6.00%
7.75%
7.75%
7.75%
7.75%
7.75%
7.75%
7.75%
7.75%
5.50%
5.50%
5.50%
5.50%
5.50%
5.50%
6.25%
5.25%
5.23%
5.00%
4.00%
4.00%
5.23%
5.50%
5.50%
5.50%
5.50%
4.50%
4.50%
4.50%
4.50%
4.50%
3.50%
(c)
(c)
(c)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(c)
(c)
(c)
(c)
(c)
(c)
(c)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(b)
(a)
(a)
(a)
(b)
(a)
(d)
10.12%
10.12%
10.12%
N/A(6)
9.92%
9.92%
9.92%
9.66%
9.92%
9.92%
9.92%
9.66%
9.67%
9.67%
9.67%
9.67%
9.67%
9.67%
10.43%
8.06%
8.04%
8.14%
7.06%
7.09%
7.95%
9.17%
9.17%
9.01%
8.92%
7.62%
7.62%
7.62%
7.77%
7.62%
9.75%
Maturity
Date
06/2023
06/2023
03/2028
03/2028
03/2028
03/2028
09/2025
09/2025
09/2025
09/2025
09/2025
09/2025
09/2025
09/2025
11/2023
11/2023
11/2023
11/2023
11/2023
11/2023
12/2027
04/2024
04/2024
04/2024
04/2024
04/2024
04/2024
06/2028
06/2028
06/2028
06/2028
06/2027
06/2027
06/2027
11/2026
11/2026
10/2026
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
$
$
22,091
581
22,672
22,086
579
22,665
1,954
974
855
—
9,963
4,005
2,061
157
684
313
300
5
9,583
6,505
1,007
904
635
2
626
3,960
67
66
35
—
—
1,932
963
846
(1)
9,847
3,958
2,037
144
676
309
295
5
9,522
6,456
997
898
631
2
617
3,962
67
66
35
—
—
44,661
44,264
19,118
15,246
455
188
35,007
18,804
14,975
447
184
34,410
17,008
16,874
80
110
584
208
2
78
108
554
206
2
0.9
—
0.9
0.1
0.1
—
—
0.4
0.2
0.1
—
—
—
—
—
0.4
0.3
—
—
—
—
—
0.1
—
—
—
—
—
1.7
0.7
0.6
—
—
1.3
0.7
—
—
—
—
—
% $
21,870
571
22,441
1,817
906
796
(3)
8,470
3,404
1,751
(5)
582
266
255
—
9,606
6,522
1,009
908
636
2
626
3,682
62
62
35
—
—
41,389
18,353
14,637
437
170
33,597
16,498
77
104
532
204
2
Total non-controlled/non-affiliate company debt investments
17,992
5,257,884
17,822
5,258,590
0.7
200.7
17,417
5,107,481
See Notes to Consolidated Financial Statements.
208
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Equity Investments
(19)(20)
Aerospace and Defense
Tronair Parent, Inc.+
Whitcraft LLC+
Auto Components
Polk Acquisition Corp.+
Automobiles
CG Group Holdings, LLC+
Go Car Wash Parent, Corp.+
Go Car Wash Parent, Corp.+
MOP GM Holding, LLC+
National Express Wash Parent Holdco, LLC+
POY Holdings, LLC+
Quick Quack Car Wash Holdings, LLC
Investment Type
LLC units
Common stock
LP interest
LP units
Preferred stock
Common stock
LP units
LP units
LLC units
LLC interest
Biotechnology
Cobepa BlueSky Aggregator, SCSp+
LP interest
Building Products
BECO Holding Company, Inc.+
BECO Holding Company, Inc.+
Chemicals
Inhance Technologies Holdings LLC+
Inhance Technologies Holdings LLC+
Commercial Services & Supplies
CI (Quercus) Intermediate Holdings, LLC+
EGD Security Systems, LLC +
Hydraulic Authority III Limited+(8)(9)(10)
Hydraulic Authority III Limited+(8)(9)(10)
North Haven Stack Buyer, LLC
PT Intermediate Holdings III, LLC+(21)
Radwell Parent, LLC+
Containers and Packaging
Chase Intermediate+
Diversified Consumer Services
CHHJ Midco, LLC+(21)
DP Flores Holdings, LLC+
EMS LINQ, LLC+
EWC Growth Partners LLC+
HS Spa Holdings, Inc.+
Liminex, Inc.+
PADI Holdco, Inc.+
Preferred stock
LP interest
Preferred stock
LLC units
LP interest
Common stock
Preferred stock
Common stock
LLC units
LLC units
LP units
LP units
LLC units
LLC units
LP interest
LLC interest
Common stock
Common stock
LLC interest
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
—
11
5
1
—
—
—
1
141
—
177
10
2
2
—
540
855
284
6
359
8
2
49
19
70
525
—
479
12
1
40
2,285
2,325
314
730
47
29
330
61
141
508
1,846
1,769
951
196
1,147
1,960
124
2,084
540
855
384
43
359
767
159
3,107
49
193
70
525
12
479
434
987
— % $
0.1
0.1
—
—
—
—
—
—
—
0.1
0.1
0.1
0.1
—
0.1
0.1
—
0.1
—
0.1
—
—
—
—
—
0.1
—
—
—
—
—
—
0.1
—
27
2,870
2,897
60
597
50
36
481
61
278
1,020
2,523
1,536
1,065
216
1,281
2,196
102
2,298
579
803
474
533
374
822
182
3,767
59
249
70
483
5
460
885
305
See Notes to Consolidated Financial Statements.
209
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Spear Education, LLC+
Spear Education, LLC+
Electronic Equipment, Instruments & Components
Electrical Source Holdings, LLC+
Inventus Power, Inc.+
Inventus Power, Inc.+
Inventus Power, Inc.+
Inventus Power, Inc.+
Investment Type
LLC interest
LLC units
LP interest
Preferred stock
LLC units
LP interest
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
—
1
—
—
—
—
—
7
1
2,708
—
372
88
20
—
480
— % $
—
0.1
—
—
—
—
—
—
35
37
2,529
77
106
185
50
—
418
See Notes to Consolidated Financial Statements.
210
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Food & Staples Retailing
Benihana, Inc.+
Cafe Rio Holding, Inc.+
Feeders Supply Company, LLC+(21)
Feeders Supply Company, LLC+
Hopdoddy Holdings, LLC+
Hopdoddy Holdings, LLC+
Mendocino Farms, LLC+
Ruby Slipper Cafe LLC, The+
Ruby Slipper Cafe LLC, The+
Wetzel's Pretzels, LLC+
Wood Fired Holding Corp.+
Wood Fired Holding Corp.+
Food Products
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
Borrower R365 Holdings, LLC+
C. J. Foods, Inc.+
Kodiak Cakes, LLC+
Kodiak Cakes, LLC+
Louisiana Fish Fry Products, Ltd.+
Louisiana Fish Fry Products, Ltd.+
P&P Food Safety Holdings, Inc.+
Purfoods, LLC+
Health Care Equipment & Supplies
Aspen Medical Products, LLC+
Blue River Pet Care, LLC+
CCSL Holdings, LLC+
CMI Parent Inc.+(21)
CMI Parent Inc.+
G & H Wire Company, Inc.+
Joerns Healthcare, LLC*+
LLC units
Common stock
Preferred stock
Common stock
LLC units
LLC units
Common stock
LLC interest
LLC interest
Common stock
LLC units
Common stock
Preferred stock
LLC units
Common stock
Preferred stock
Preferred stock
Common stock
LLC units
Common stock
Preferred stock
Common stock
LLC interest
LP interest
Common stock
LP interest
Common stock
Common stock
LLC interest
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
43
5
4
—
44
20
168
32
2
—
437
437
77
3
1
1
—
—
191
—
—
4
—
—
—
—
—
3
335
432
699
603
401
—
217
61
770
389
20
416
444
—
4,020
102
5
2
2
75
281
191
483
13
356
946
2,456
77
76
336
132
3
269
4,329
5,222
0.1 % $
—
—
—
—
—
0.1
—
—
—
—
0.1
0.3
—
—
—
—
—
—
—
—
—
—
0.2
0.2
—
—
—
—
—
—
—
—
718
758
592
181
211
60
1,738
155
28
884
593
1,675
7,593
114
5
2
2
484
148
175
251
13
208
4,657
6,059
101
165
254
172
279
16
—
987
See Notes to Consolidated Financial Statements.
211
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Health Care Providers & Services
Active Day, Inc.+
Acuity Eyecare Holdings, LLC+
Acuity Eyecare Holdings, LLC+
ADCS Clinics Intermediate Holdings, LLC+
ADCS Clinics Intermediate Holdings, LLC+
AVG Intermediate Holdings & AVG Subsidiary Holdings LLC+
CRH Healthcare Purchaser, Inc.+
DCA Investment Holding, LLC
DCA Investment Holding, LLC
Emerge Intermediate, Inc.+
Emerge Intermediate, Inc.+
Emerge Intermediate, Inc.+
Encore GC Acquisition, LLC+
Encore GC Acquisition, LLC+
Encorevet Group LLC+
Encorevet Group LLC+
Eyecare Services Partners Holdings LLC+
Eyecare Services Partners Holdings LLC+
Krueger-Gilbert Health Physics, LLC+
Midwest Veterinary Partners, LLC+
Midwest Veterinary Partners, LLC+
Midwest Veterinary Partners, LLC+
MWD Management, LLC & MWD Services, Inc.+
NDX Parent, LLC+
New Look (Delaware) Corporation and NL1 AcquireCo, Inc.+(8)(9)(12)
Oliver Street Dermatology Holdings, LLC+
Pinnacle Treatment Centers, Inc.+
Pinnacle Treatment Centers, Inc.+
Radiology Partners, Inc.+
Radiology Partners, Inc.+
Sage Dental Management, LLC+
Sage Dental Management, LLC+
SSH Corporation+
Suveto Buyer, LLC+
LLC interest
LLC interest
LLC units
Preferred stock
Common stock
LLC units
LP interest
LLC interest
LLC units
LLC units
LLC units
LLC units
LLC interest
LLC units
Common stock
LLC units
LLC units
LLC units
Common stock
LLC units
Warrant
Warrant
LLC interest
Common stock
Common stock
LLC interest
LLC interest
LLC interest
LLC units
LLC interest
LLC units
LLC units
Common stock
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
2
1,632
889
2
—
129
429
13,890
140
—
—
9
26
26
—
—
—
—
177
1
6
—
412
—
—
452
—
4
11
43
—
3
—
6
1,099
2,235
1,023
1,119
6
132
327
1,025
218
648
61
4
272
52
15
11
262
1
199
1,019
—
29
335
272
304
234
528
74
68
55
249
3
40
562
% $
—
0.2
0.1
0.1
—
—
0.1
0.1
0.1
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
386
3,719
2,176
1,402
—
154
1,252
1,809
905
841
64
—
—
—
21
13
—
—
241
1,156
459
39
526
91
265
—
739
781
67
266
222
—
213
327
12,481
0.7
18,134
See Notes to Consolidated Financial Statements.
212
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Health Care Technology
Connexin Software, Inc.+
HSI Halo Acquisition, Inc.+
HSI Halo Acquisition, Inc.+
Symplr Software, Inc.+
Symplr Software, Inc.+
Symplr Software, Inc.+
Symplr Software, Inc.+
Symplr Software, Inc.+
Symplr Software, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Tebra Technologies, Inc.+
Hotels, Restaurants & Leisure
Freddy's Frozen Custard LLC+
Harri US LLC+
Harri US LLC+
Harri US LLC+
LMP TR Holdings, LLC(21)
SSRG Holdings, LLC+
Tropical Smoothie Cafe Holdings, LLC+(21)
Household Durables
Groundworks LLC+
Insurance
Majesco+
Majesco+
Internet and Catalog Retail
Revalize, Inc.+
Revalize, Inc.+
Revalize, Inc.+
IT Services
Appriss Health Intermediate Holdings, Inc+
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Arctic Wolf Networks, Inc. and Arctic Wolf Networks Canada, Inc.+
Critical Start, Inc.+
Episerver, Inc.+
Kentik Technologies, Inc.+
Investment Type
LLC interest
LP interest
LP interest
Preferred stock
Preferred stock
Preferred stock
Preferred stock
LLC units
Common stock
Warrant
Warrant
LLC interest
Preferred stock
LP interest
LLC units
Preferred stock
Warrant
LLC units
LP interest
LP interest
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
LLC interest
N/A
LP interest
LP interest
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Warrant
Common stock
Common stock
Preferred stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
154
$
—
—
12
2
2
1
—
177
169
53
348
1
206
83
71
18
712
6
5
—
—
69
17
10
1
2
587
154
35
202
225
75
192
193
288
—
11,807
2,734
1,427
880
161
—
871
162
2,824
8
21,355
206
658
455
106
712
61
246
2,444
155
307
—
307
17,025
10,219
1,104
28,348
1,994
462
423
291
159
225
807
1,103
% $
—
—
—
0.5
0.2
0.1
0.1
—
—
—
—
0.1
—
1.0
—
—
—
—
0.1
—
0.1
0.2
—
—
—
—
0.7
0.4
—
1.1
0.1
0.2
0.1
—
0.1
—
—
—
208
389
45
12,515
4,015
1,661
971
159
739
686
162
2,958
12
24,520
285
658
512
129
2,956
80
945
5,565
442
364
43
407
17,564
10,542
1,096
29,202
2,172
4,684
1,228
285
1,481
225
655
1,171
See Notes to Consolidated Financial Statements.
213
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Netwrix Corporation+
PCS Intermediate II Holdings, LLC+
Red Dawn SEI Buyer, Inc.+
Saturn Borrower Inc.+
Leisure Products
Massage Envy, LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
WBZ Investment LLC+
Life Sciences Tools & Services
PAS Parent Inc.+
Reaction Biology Corporation+
Oil, Gas and Consumable Fuels
W3 Co.+
W3 Co.+
Paper and Forest Products
Messenger, LLC+
Messenger, LLC+
Pharmaceuticals
Amalthea Parent, Inc.+(8)(12)
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Cobalt Buyer Sub, Inc.+
Investment Type
LLC units
LLC interest
LP interest
LP units
LLC interest
LLC interest
LLC interest
LLC interest
LLC interest
LLC interest
LLC interest
LP interest
LLC units
LLC interest
Preferred stock
LLC units
LLC units
LP interest
Preferred stock
Preferred stock
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
9
37
13
346
749
67
46
38
33
15
2
9
—
3
—
3
—
502
8
—
2
18
367
13
346
6,208
210
117
80
65
58
24
2
556
933
265
1,198
1,632
224
1,856
312
—
312
502
7,679
168
2
8,351
— % $
—
—
—
0.5
0.1
—
—
—
—
—
—
0.1
—
—
—
—
—
—
—
—
—
0.1
0.4
—
—
0.5
Fair
Value
(4)
20
504
19
109
12,553
1,715
192
131
108
95
40
4
2,285
781
267
1,048
1,004
188
1,192
280
—
280
943
8,840
154
—
9,937
See Notes to Consolidated Financial Statements.
214
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Professional Services
Brandmuscle, Inc.+
Enboarder, Inc.+(8)(11)
Filevine, Inc.+
Filevine, Inc.+
Net Health Acquisition Corp.+
Procure Acquireco, Inc.+
Real Estate Management & Development
Inhabit IQ Inc.+
SC Landco Parent, LLC+(8)
Road & Rail
Internet Truckstop Group LLC+
Software
Accela, Inc.+
Anaplan, Inc.+
Aras Corporation+
Aras Corporation+
Astute Holdings, Inc.+
Auvik Networks Inc.+(8)(12)
Bayshore Intermediate #2, L.P.+
Calabrio, Inc.+
Calabrio, Inc.+
Cloudbees, Inc.+
Cloudbees, Inc.+
Cloudbees, Inc.+
Cynet Security Ltd.+(8)(15)
Diligent Corporation+
Diligent Corporation+
FirstUp, Inc.+
GS Acquisitionco, Inc.+
GS Acquisitionco, Inc.+
GS Acquisitionco, Inc.+
GTY Technology Holdings, Inc.+
Impartner, Inc.+
Kaseya Inc.+
Kaseya Inc.+
MetricStream, Inc.+
Ministry Brands Holdings LLC+
mParticle, Inc.+
mParticle, Inc.+
Onapsis, Inc., Virtual Forge GMBH and Onapsis GMBH+
Personify, Inc.+
Project Alpha Intermediate Holding, Inc.+
Investment Type
LLC interest
Preferred stock
Preferred stock
Warrant
LP interest
LP interest
Common stock
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
LP interest
N/A
LLC interest
LP interest
Preferred stock
LP interest
LP interest
Preferred stock
Common stock
LP interest
LP interest
Preferred stock
Warrant
Preferred stock
Preferred stock
Preferred stock
Preferred stock
Common stock
Preferred stock
Preferred stock
LP interest
LP units
Preferred stock
Preferred stock
LP interest
Warrant
LP interest
Preferred stock
Warrant
Warrant
LP interest
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
—
56
221
33
13
—
62
2
216
573
1,401
49
1,509
486
4,234
434
274
708
408
447
670
385
1
306
—
26
4,095
1
96
149
131
71
143
17
415
221
26
2
1
46
28
2
100
168
438
162
73
4
716
—
418
385
1,000
306
304
256
4,095
769
0
1,663
247
466
508
16,587
913
541
25,344
1,532
170
46
226
1,658
100
263
439
1,060
16
9
942
964
% $
—
—
0.1
—
0.1
—
0.2
—
—
—
—
—
—
0.1
—
—
—
0.2
—
—
0.1
0.1
0.1
—
0.7
0.1
—
1.1
0.1
—
—
—
0.1
—
—
—
—
—
—
0.1
0.1
149
620
1,479
153
1,719
516
4,636
472
248
720
532
330
385
1,165
247
754
278
3,834
875
0
1,905
1,342
877
508
18,299
2,088
361
27,141
1,588
1,038
46
249
1,756
100
147
251
1,141
419
19
1,565
1,386
See Notes to Consolidated Financial Statements.
215
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Project Alpha Intermediate Holding, Inc.+
Pyramid Healthcare Acquisition Corp.+
QAD, Inc.+
QAD, Inc.+
RegEd Aquireco, LLC+
RegEd Aquireco, LLC+
Riskonnect Parent, LLC+
Riskonnect Parent, LLC+
Riskonnect Parent, LLC+
SnapLogic, Inc.+
SnapLogic, Inc.+
Spartan Buyer Acquisition Co.+
Telesoft Holdings LLC+
Templafy APS and Templafy, LLC+(8)(18)
Workforce Software, LLC+
Workforce Software, LLC+
Investment Type
Common stock
Common stock
Preferred stock
Common stock
LP interest
LP interest
Preferred stock
LP interest
Preferred stock
Preferred stock
Warrant
Common stock
LP interest
Warrant
Common stock
Common stock
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
202
184
—
9
—
3
18
857
—
278
106
1
6
—
—
—
329
184
125
0
331
21
18,055
859
323
695
75
623
6
62
973
36
83,924
— % $
—
—
—
—
—
0.7
—
—
0.1
—
—
—
—
—
—
3.7
188
267
120
0
66
0
17,791
825
340
1,392
361
747
6
62
577
38
92,874
See Notes to Consolidated Financial Statements.
216
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Specialty Retail
Ave Holdings III, Corp+
Ave Holdings III, Corp+
Batteries Plus Holding Corporation+
Cycle Gear, Inc.+
Imperial Optical Midco Inc.+
Imperial Optical Midco Inc.+
Jet Equipment & Tools Ltd.+(8)(9)(12)
Pet Holdings ULC+(8)(12)
Salon Lofts Group, LLC+
Sola Franchise, LLC and Sola Salon Studios, LLC+
Sola Franchise, LLC and Sola Salon Studios, LLC+
Southern Veterinary Partners, LLC+
Southern Veterinary Partners, LLC+
Southern Veterinary Partners, LLC+
VSG Acquisition Corp. and Sherrill, Inc.+
Technology Hardware, Storage & Peripherals
Agility Recovery Solutions Inc.+
Textiles, Apparel & Luxury Goods
Georgica Pine Clothiers, LLC+(21)
Georgica Pine Clothiers, LLC+
MakerSights, Inc.+
R.G. Barry Corporation+
Total non-controlled/non-affiliate company equity investments
Total non-controlled/non-affiliate company investments
Investment Type
Preferred stock
LP units
LLC interest
LLC units
Preferred stock
Preferred stock
LLC interest
LP interest
LP units
LLC interest
LLC interest
Preferred stock
LLC units
LLC interest
LP units
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
LLC interest
N/A
LLC interest
Common stock
Preferred stock
Preferred stock
N/A
N/A
N/A
N/A
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$
9
1
10
27
—
—
1
677
—
6
1
5
—
148
—
8,508
934
1,287
462
122
46
948
450
87
682
139
4,911
717
188
37
19,518
97
604
20
—
40
—
239
—
218
161
618
0.4 % $
0.1
0.1
—
—
—
0.1
0.1
—
0.1
—
0.2
0.1
0.2
—
1.4
—
—
—
—
—
—
9,086
888
1,386
602
169
62
2,077
1,732
87
1,848
433
5,682
1,124
4,240
39
29,455
411
511
1
218
183
913
221,151
10.1
267,113
5,479,741
211.3
$
5,374,594
See Notes to Consolidated Financial Statements.
217
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Non-controlled/affiliate company investments
(22)
Debt investments
Beverages
Abita Brewing Co., L.L.C.+
Abita Brewing Co., L.L.C.+
Abita Brewing Co., L.L.C.+
Electronic Equipment, Instruments and Components
Sloan Company, Inc., The+(7)
Sloan Company, Inc., The+
Sloan Company, Inc., The+(7)
Energy, Equipment & Services
Benetech, Inc.+(7)
Benetech, Inc.+(7)
Food and Staples Retailing
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+(5)
Healthcare Providers and Services
Elite Dental Partners LLC+
Elite Dental Partners LLC+
Elite Dental Partners LLC+
Software
Switchfly LLC+
Switchfly LLC+
Switchfly LLC+
Switchfly LLC+(5)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
One stop
Second lien
One stop
One stop
One stop
One stop
One stop
One stop
L +
L +
L +
L +
L +
L +
6.25%
8.00%
6.25 %
8.50%
8.50%
8.50%
SF + 6.00%
SF + 6.00%
(a)
(b)
(b)
(b)
(b)
(l)
(l)
Senior secured
Senior secured
L +
L +
8.00%
(b)
8.00 %
One stop
One stop
One stop
One stop
One stop
One stop
One stop
SF + 5.25%
SF + 12.00%
SF + 5.25%
(b)(l)
(l)
(b)(l)
L +
L +
L +
L +
3.00%
3.00%
3.00%
8.50%
(b)
(b)
(b)
(b)
9.37%
11.67%
N/A(6)
12.17%
12.17%
12.17%
9.70%
9.70%
11.60%
N/A(6)
8.80%
15.55%
8.80%
5.28%
5.28%
5.28%
10.79%
PIK
PIK
PIK
$
04/2024
04/2024
04/2024
07/2023
07/2023
07/2023
08/2024
08/2024
12/2024
12/2024
06/2023
06/2023
06/2023
10/2024
10/2024
10/2024
10/2024
$
5,786
3,730
—
9,516
6,502
1,585
431
8,518
3,720
1,107
4,827
12,830
—
12,830
11,770
2,991
1,269
16,030
6,454
539
40
2
7,035
5,791
3,723
—
9,514
4,074
1,585
271
5,930
3,623
1,077
4,700
12,638
(11)
12,627
11,799
2,991
1,269
16,059
6,397
535
40
2
6,974
0.2 % $
0.1
—
0.3
0.2
0.1
—
0.3
0.1
—
0.1
0.4
—
0.4
0.4
0.1
—
0.5
0.2
—
—
—
0.2
5,786
2,051
—
7,837
4,733
1,585
—
6,318
1,487
253
1,740
10,905
(208)
10,697
11,182
2,961
1,269
15,412
4,583
382
30
(16)
4,979
Total non-controlled/affiliate company debt investments
58,756
55,804
1.8
46,983
See Notes to Consolidated Financial Statements.
218
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
Equity investments
(19)(20)
Beverages
Abita Brewing Co., L.L.C.+
Warrant
N/A
Electronic Equipment, Instruments and Components
Sloan Company, Inc., The+
Common stock
N/A
Energy, Equipment & Services
Benetech, Inc.+
Benetech, Inc.+
Food and Staples Retailing
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Rubio's Restaurants, Inc.+
Healthcare Providers and Services
Elite Dental Partners LLC
Elite Dental Partners LLC
Elite Dental Partners LLC
Software
Switchfly LLC+
Switchfly LLC+
Total non-controlled/affiliate company equity investments
Total non-controlled/affiliate company investments
LLC interest
LLC interest
Preferred stock
Common stock
Common stock
Common stock
Common stock
Common stock
Common stock
Common stock
Common stock
Common stock
Common stock
LLC interest
LLC interest
LLC units
LLC interest
LLC units
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
210
$
—
58
58
—
41
—
—
—
2,779
2,276
886
536
89
52
21
21
42
18
18
89
—
—
—
98,370
950
182
110
6
3
—
—
—
—
—
—
2,577
2,902
1,250
—
4,152
2,321
950
3,271
10,041
65,845
— % $
234
—
—
—
—
0.1
—
—
—
—
—
—
—
—
—
—
0.1
0.2
—
—
0.2
0.1
—
0.1
0.4
2.2
—
—
—
—
2,059
250
151
11
6
—
—
—
—
—
—
2,477
4,042
1,235
—
5,277
2,231
487
2,718
10,706
57,689
See Notes to Consolidated Financial Statements.
219
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
Controlled affiliate company investments
(23)
Debt Investments
IT Services
MMan Acquisition Co.*+(7)
MMan Acquisition Co.+
MMan Acquisition Co.+
MMan Acquisition Co.+
MMan Acquisition Co.+
Total controlled affiliate company debt investments
Equity Investments
(19)(20)
IT Services
MMan Acquisition Co.+
Total controlled affiliate company equity investments
Total controlled affiliate company investments
Total investments
Investment Type
Spread
Above
Index
(1)
Interest
Rate
(2)
Maturity
Date
Principal ($) /
Shares
(3)
Amortized Cost
Percentage
of Net
Assets
Fair
Value
(4)
One stop
One stop
One stop
One stop
One stop
N/A
N/A
N/A
N/A
N/A
10.00%
8.00%
12.00%
12.00%
12.00%
PIK
PIK
PIK
PIK
PIK
$
08/2023
08/2023
08/2023
08/2023
08/2023
$
30,277
1,588
849
255
849
33,818
Common stock
N/A
N/A
N/A
—
19,550
1,588
849
255
849
23,091
927
927
24,018
% $
0.4
0.1
—
—
—
0.5
—
—
0.5
10,596
1,524
849
255
849
14,073
—
—
14,073
5,569,604
214.0
5,446,356
37,208
37,208
1.5
1.5
37,208
37,208
$
5,606,812
215.5 % $
5,483,564
Money market funds (included in cash and cash equivalents and restricted cash and cash equivalents)
BlackRock Liquidity Funds T-Fund Institutional Shares (CUSIP 09248U718)
2.8%
(24)
Total money market funds
Total Investments and Money Market Funds
See Notes to Consolidated Financial Statements.
220
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
*
#
+
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
(12)
(13)
Denotes that all or a portion of the loan secures the notes offered in the 2018 Debt Securitization (as defined in Note 7).
Denotes that all or a portion of the loan secures the notes offered in the GCIC 2018 Debt Securitization (as defined in Note 7).
Denotes that all or a portion of the investment collateralizes the JPM Credit Facility (as defined in Note 7).
The majority of the investments bear interest at a rate that is permitted to be determined by reference to SOFR, EURIBOR, Prime, Canadian Prime (“CP”), SONIA, AUD, CDOR or LIBOR denominated in U.S. dollars which reset daily, monthly, quarterly,
semiannually, or annually. For each, the Company has provided the spread over the applicable index and the weighted average current interest rate in effect as of September 30, 2022. Certain investments are subject to an interest rate floor. For fixed rate loans,
a spread above a reference rate is not applicable. For positions with multiple outstanding contracts, the spread for the largest outstanding contract is shown. Listed below are the index rates as of September 30, 2022 , which was the last business day of the period
on which the applicable index rates were determined. The actual index rate for each loan listed may not be the applicable index rate outstanding as of September 30, 2022 , as the loan may have priced or repriced based on an index rate prior to September 30,
2022.
(a)
Denotes that all or a portion of the loan was indexed to the 30-day LIBOR, which was 3.14% as of September 30, 2022.
(b)
Denotes that all or a portion of the loan was indexed to the 90-day LIBOR, which was 3.75% as of September 30, 2022.
(c)
Denotes that all or a portion of the loan was indexed to the 180-day LIBOR, which was 4.23% as of September 30, 2022.
(d)
Denotes that all or a portion of the loan was indexed to the Prime rate, which was 6.25% as of September 30, 2022.
(e)
Denotes that all or a portion of the loan was indexed to the 90-day EURIBOR, which was 1.17% as of September 30, 2022.
(f)
Denotes that all or a portion of the loan was indexed to the 180-day EURIBOR, which was 1.81% as of September 30, 2022.
(g)
(h)
Denotes that all or a portion of the loan was indexed to the Three-Month AUD, which was 3.11% as of September 30, 2022.
Denotes that all or a portion of the loan was indexed to the 90-day CDOR, which was 4.20% as of September 30, 2022.
(i)
(j)
Denotes that all or a portion of the loan was indexed to SONIA, which was 2.19% as of September 30, 2022.
Denotes that all or a portion of the loan was indexed to Daily SOFR, which was 2.98% as of September 30, 2022.
(k)
Denotes that all or a portion of the loan was indexed to the 30-day Term SOFR which was 3.04% as of September 30, 2022.
(l)
Denotes that all or a portion of the loan was indexed to the 90-day Term SOFR which was 3.59% as of September 30, 2022.
(m)
Denotes that all or a portion of the loan was indexed to the 180-day Term SOFR which was 3.99% as of September 30, 2022.
(n)
Denotes that all or a portion of the loan was indexed to the Canadian Prime, which was 5.45% as of September 30, 2022.
For positions with multiple interest rate contracts, the interest rate shown is a weighted average current interest rate in effect as of September 30, 2022.
The total principal amount is presented for debt investments while the number of shares or units owned is presented for equity investments.
The fair values of investments were valued using significant unobservable inputs, unless noted otherwise. See Note 6. Fair Value Measurements.
The negative fair value is the result of the capitalized discount on the loan or the unfunded commitment being valued below par. The negative amortized cost is the result of the capitalized discount being greater than the principal amount outstanding on the loan.
The entire commitment was unfunded as of September 30, 2022. As such, no interest is being earned on this investment. The investment may be subject to an unused facility fee.
Loan was on non-accrual status as of September 30, 2022, meaning that the Company has ceased recognizing interest income on the loan.
The investment is treated as a non-qualifying asset under Section 55(a) of the 1940 Act. Under the 1940 Act, the Company cannot acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the
Company's total assets. As of September 30, 2022, total non-qualifying assets at fair value represented 11.6% of the Company's total assets calculated in accordance with the 1940 Act.
Investment is denominated in foreign currency and is translated into U.S. dollars as of the valuation date or the date of the transaction. See Note 2. Significant Accounting Policies and Recent Accounting Updates - Foreign Currency Transactions.
The headquarters of this portfolio company is located in the United Kingdom.
The headquarters of this portfolio company is located in Australia.
The headquarters of this portfolio company is located in Canada.
The headquarters of this portfolio company is located in Luxembourg.
(14)
The headquarters of this portfolio company is located in Netherlands.
(15)
(16)
(17)
(18)
(19)
The headquarters of this portfolio company is located in Israel.
The headquarters of this portfolio company is located in Finland.
The headquarters of this portfolio company is located in Sweden.
The headquarters of this portfolio company is located in Denmark.
Equity investments are non-income producing securities unless otherwise noted.
See Notes to Consolidated Financial Statements.
221
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Consolidated Schedule of Investments - (continued)
September 30, 2022
(Dollar and share amounts in thousands)
(20)
(21)
(22)
Ownership of certain equity investments occurs through a holding company or partnership.
The Company holds an equity investment that is income producing.
Transactions related to investments in non-controlled affiliates for the year ended September 30, 2022 were as follows:
Portfolio Company
Abita Brewing Co. LLC
Benetech, Inc.
Elite Dental Partners LLC
Paradigm DKD Group, LLC
Rubio's Restaurants, Inc
Sloan Company, Inc.
Switchfly LLC
Uinta Brewing Company
Total Non-Controlled Affiliates
Fair value as of
September 30, 2021
Gross Additions
(a)
Gross Reductions
(b)
Net change in unrealized
appreciation
(depreciation)
Net realized gain (loss)
Fair value as of
September 30, 2022
Interest, dividend and fee
income
$
$
10,050 $
413 $
(212) $
(2,180) $
— $
8,071 $
2,399
16,952
2,627
17,559
5,162
6,168
462
2,821
4,151
357
4
1,520
1,321
22
(2,512)
(60)
(3,605)
(44)
(648)
—
(498)
(968)
(354)
(571)
(4,345)
284
208
1,040
61,379 $
10,609 $
(7,579) $
(6,886) $
—
—
1,192
—
—
—
(1,026)
166 $
1,740
20,689
—
13,174
6,318
7,697
—
57,689 $
823
227
1,313
2,026
1,379
127
603
6
6,504
(a)
(b)
Gross additions may include increases in the cost basis of investments resulting from new investments, amounts related to PIK interest capitalized and added to the principal balance of the respective loans, the accretion of discounts, the
exchange of one or more existing investments for one or more new investments and the movement of an existing portfolio company into this affiliated category from a different category.
Gross reductions may include decreases in the cost basis of investments resulting from principal collections related to investment repayments and sales, the amortization of premiums, the reversal of capitalized PIK for non-accrual positions and
the exchange of one or more existing securities for one or more new securities.
(23)
Transactions related to investments in controlled affiliates for the year ended September 30, 2022 were as follows:
Portfolio Company
MMan Acquisition Co.
Total Controlled Affiliates
Fair value as of
September 30, 2021
$
$
18,237 $
18,237 $
Gross Additions
(a)
Gross Reductions
(b)
Net change in unrealized
appreciation
(depreciation)
Net realized gain (loss)
Fair value as of
September 30, 2022
Interest, dividend and fee
income
4,956 $
4,956 $
(2,996) $
(2,996) $
(6,124) $
(6,124) $
— $
— $
14,073 $
14,073 $
102
102
(a)
(b)
Gross additions may include increases in the cost basis of investments resulting from new investments, amounts related to PIK interest capitalized and added to the principal balance of the respective loans, the accretion of discounts, the exchange of
one or more existing investments for one or more new investments and the movement of an existing portfolio company into this affiliated category from a different category.
Gross reductions may include decreases in the cost basis of investments resulting from principal collections related to investment repayments or sales, the amortization of premiums, the reversal of capitalized PIK for non-accrual positions and the
exchange of one or more existing securities for one or more new securities.
(24)
The rate shown is the annualized seven-day yield as of September 30, 2022.
See Notes to Consolidated Financial Statements.
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Note 1. Organization
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Golub Capital BDC, Inc. (“GBDC” and, collectively with its consolidated subsidiaries, the “Company”) is an externally managed, closed-end, non-diversified management investment
company. GBDC has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended (the “1940 Act”). In addition, for
U.S. federal income tax purposes, GBDC has elected to be treated as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended
(the “Code”).
The Company’s investment strategy is to invest primarily in one stop (a loan that combines characteristics of traditional first lien senior secured loans and second lien or subordinated
loans and that are often referred to by other middle-market lenders as unitranche loans) and other senior secured loans of U.S. middle-market companies that are, in most cases,
sponsored by private equity firms. The Company also selectively invests in second lien and subordinated (a loan that ranks senior only to a borrower’s equity securities and ranks junior
to all of such borrower’s other indebtedness in priority of payment) loans of, and warrants and minority equity securities in, U.S. middle-market companies. The Company has entered
into the Fourth Amended and Restated Investment Advisory Agreement effective as of July 1, 2023 (the “Investment Advisory Agreement”) with GC Advisors LLC (the “Investment
Adviser”), under which the Investment Adviser manages the day-to-day operations of, and provides investment advisory services to, the Company. Under an administration agreement
(the “Administration Agreement”) the Company is provided with certain services by an administrator (the “Administrator”), which is currently Golub Capital LLC.
On September 16, 2019, the Company completed its acquisition of Golub Capital Investment Corporation (“GCIC”), a Maryland corporation, pursuant to that certain Agreement and
Plan of Merger (as amended, the “Merger Agreement”), dated as of November 27, 2018, by and among the Company, GCIC, Fifth Ave Subsidiary Inc., a Maryland corporation and
wholly owned subsidiary of the Company, the Investment Adviser, and, for certain limited purposes, the Administrator.
Note 2. Significant Accounting Policies and Recent Accounting Updates
Basis of presentation: The Company is an investment company as defined in the accounting and reporting guidance under Accounting Standards Codification (“ASC”) Topic
946 — Financial Services — Investment Companies (“ASC Topic 946”).
The accompanying consolidated financial statements of the Company and related financial information have been prepared in accordance with generally accepted accounting principles
in the United States of America (“GAAP”) as established by the Financial Accounting Standards Board (“FASB”) for financial information and pursuant to the requirements for reporting
on Form 10-K and Regulation S-X. In the opinion of management, the consolidated financial statements reflect all adjustments and reclassifications consisting solely of normal accruals
that are necessary for the fair presentation of financial results as of and for the periods presented. All intercompany balances and transactions have been eliminated. Certain prior
period amounts have been reclassified to conform to the current period presentation.
Fair value of financial instruments: The Company applies fair value to all of its financial instruments in accordance with ASC Topic 820 — Fair Value Measurement (“ASC Topic
820”). ASC Topic 820 defines fair value, establishes a framework used to measure fair value and requires disclosures for fair value measurements. In accordance with ASC Topic 820,
the Company has categorized its financial instruments carried at fair value, based on the priority of the valuation technique, into a three-level fair value hierarchy. Fair value is a
market-based measure considered from the perspective of the market participant who holds the financial instrument rather than an entity-specific measure. Therefore, when market
assumptions are not readily available, the Company’s own assumptions are set to reflect those that management believes market participants would use in pricing the financial
instrument at the measurement date.
The availability of observable inputs can vary depending on the financial instrument and is affected by a wide variety of factors, including, for example, the type of product, whether the
product is new, whether the product is traded on an active exchange or in the secondary market and the current market conditions. To the extent that the valuation is based on models
or inputs that are less
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair
value is greatest for financial instruments classified as Level 3.
Any changes to the valuation methodology are reviewed by management and the Company’s board of directors (the “Board”) to confirm that the changes are appropriate. As markets
change, new products develop and the pricing for products becomes more or less transparent, the Company will continue to refine its valuation methodologies. See further description
of fair value methodology in Note 6 Fair Value Measurements.
Use of estimates: The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from those estimates.
Consolidation: As provided under Regulation S-X and ASC Topic 946, the Company will generally not consolidate its investment in a company other than an investment company
subsidiary or a controlled operating company whose business consists of providing services to the Company. Accordingly, the Company consolidated
the results of the Company’s wholly-owned subsidiaries Golub Capital BDC CLO III Depositor LLC (“2018 CLO Depositor”); Golub Capital BDC CLO III LLC (“2018 Issuer”); Golub
Capital BDC Holdings, LLC (“Holdings”); GCIC Holdings LLC (“GCIC Holdings”); GCIC CLO II Depositor LLC (“GCIC 2018 CLO Depositor”); GCIC CLO II LLC (“GCIC 2018 Issuer”);
GCIC Funding LLC (“GCIC Funding”); GBDC Holdings Coinvest, Inc.; GBDC Holdings ED Coinvest, Inc.; GCIC North Haven Stack Buyer Coinvest, Inc.; GCIC Quick Quack Coinvest
LLC; GBDC Quick Quack Coinvest LLC; prior to May 10, 2021, the date of each of the following entity’s dissolution, GC SBIC IV, L.P. (“SBIC IV”) and GC SBIC IV-GP, LLC; prior to
March 23, 2022, the date of each of the following entity’s dissolution, Golub Capital BDC CLO 4 Depositor LLC (“2020 CLO Depositor”), GC SBIC V, L.P. (“SBIC V”) and GC SBIC V-
GP, LLC, Mountain Open, Mountain Open 2, Senior Loan Fund LLC and Senior Loan Fund II LLC; prior to its dissolution on September 16, 2022, Golub Capital BDC Funding II LLC
(“Funding II”); prior to its dissolution on September 12, 2023, BDC CLO 2014 LLC; and prior to September 27, 2022, the date of each of the following entity’s dissolution, GCIC Funding
II LLC (“GCIC Funding II”), Golub Capital BDC Funding LLC (“Funding”), GC BDC Holdings 2010-1 LLC, GCIC BDC 2010-1 LLC, GCIC CLO 2016-1 LLC, GC SBIC VI, L.P. (“SBIC VI”)
and GC SBIC VI-GP, LLC.
Assets related to transactions that do not meet ASC Topic 860 requirements for accounting sale treatment are reflected in the Company’s Consolidated Statements of Financial
Condition as investments. Those assets are owned by special purpose entities, including Holdings, 2018 Issuer, Funding II, GCIC Holdings and the GCIC 2018 Issuer that are
consolidated in the Company’s consolidated financial statements. The creditors of the special purpose entities have received security interests in such assets and such assets are not
intended to be available to the creditors of GBDC (or any affiliate of GBDC).
Cash and cash equivalents and foreign currencies: Cash and cash equivalents and foreign currencies are highly liquid investments with an original maturity of three months or less
at the date of acquisition. The Company deposits its cash in financial institutions and, at times, such balances exceed the Federal Deposit Insurance Corporation insurance limits.
Restricted cash and cash equivalents and restricted foreign currencies: Restricted cash and cash equivalents and restricted foreign currencies include amounts that are
collected and are held by trustees who have been appointed as custodians of the assets securing certain of the Company’s financing transactions. Restricted cash and cash
equivalents and restricted foreign currencies are held by the trustees for payment of interest expense and principal on the outstanding borrowings or reinvestment into new assets.
Foreign currency translation: The Company’s books and records are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars. Non-U.S. dollar
transactions during the year are valued at the prevailing spot rates on the applicable transaction date and the related assets and liabilities are revalued at the prevailing spot rates as of
year-end.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Net assets and fair values are presented based on the applicable foreign exchange rates and fluctuations arising from the translation of assets and liabilities are included with the net
change in unrealized appreciation (depreciation) on translation of assets and liabilities in foreign currencies on the Consolidated Statements of Operations.
Foreign security and currency transactions involve certain considerations and risks not typically associated with investing in U.S. companies. These risks include, but are not limited to,
currency fluctuations and revaluations and future adverse political, social and economic developments, which could cause investments in foreign markets to be less liquid and prices
more volatile than those of comparable U.S. companies or U.S. government securities.
Forward currency contracts: A forward currency contract is an obligation between two parties to purchase or sell a specific currency for an agreed-upon price at a future date. The
Company utilized forward currency contracts to economically hedge the currency exposure associated with certain foreign-denominated investments. The use of forward currency
contracts does not eliminate fluctuations in the price of the underlying securities the Company owns or intends to acquire but establishes a rate of exchange in advance. Fluctuations in
the value of these contracts are measured by the difference in the exchange rates on the contract date and reporting date and are recorded as unrealized appreciation (depreciation)
until the contracts are closed. When the contracts are closed, realized gains (losses) are recorded. Realized gains (losses) and unrealized appreciation (depreciation) on the contracts
are included in the Consolidated Statements of Operations. Unrealized appreciation (depreciation) on forward currency contracts is recorded on the Consolidated Statements of
Financial Condition by counterparty on a net basis, not taking into account collateral posted which is recorded separately, if applicable.
The primary risks associated with forward currency contracts include failure of the counterparty to meet the terms of the contract and the value of the foreign currency changing
unfavorably. These risks can exceed the amounts reflected in the Consolidated Statements of Financial Condition.
Refer to Note 5 for more information regarding the forward currency contracts.
Revenue recognition:
Investments and related investment income: Interest income is accrued based upon the outstanding principal amount and contractual interest terms of debt investments.
Loan origination fees, original issue discount and market discount or premium are capitalized, and the Company accretes or amortizes such amounts over the life of the loan as interest
income. For the years ended September 30, 2023, 2022 and 2021, interest income included $19,951, $24,679 and $21,399, respectively, of accretion of discounts. For the years ended
September 30, 2023, 2022 and 2021, the Company received loan origination fees of $17,692, $27,023 and $34,215, respectively.
For investments with contractual payment-in-kind (“PIK”) interest, which represents contractual interest accrued and added to the principal balance that generally becomes due at
maturity, the Company will not accrue PIK interest if the portfolio company valuation indicates that the PIK interest is not collectible. For the years ended September 30, 2023, 2022
and 2021, interest income included $40,590, $23,354 and $13,931, respectively, of PIK interest and the Company capitalized PIK interest of $38,844, $21,506 and $16,092,
respectively, into the principal balance of certain debt investments.
In addition, the Company generates revenue in the form of amendment, structuring or due diligence fees, fees for providing managerial assistance, consulting fees, administrative
agent fees, and prepayment premiums on loans. The Company records these fees as fee income when earned. For the years ended September 30, 2023, 2022 and 2021, fee income
included $79, $3,040 and $3,200 from non-recurring prepayment premiums, respectively. All other income is recorded into income when earned.
For the years ended September 30, 2023, 2022 and 2021, the Company received interest and fee income in cash, which excludes capitalized loan origination fees, in the amounts of
$496,114, $354,032 and $301,687, respectively.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Dividend income on equity securities is recorded as dividend income on an accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be
collected. The Company has certain preferred equity securities in the portfolio that contain a PIK dividend provision that are accrued and recorded as income at the contractual rates, if
deemed collectible. The accrued PIK and non-cash dividends are capitalized to the cost basis of the preferred equity security and are generally collected when redeemed by the issuer.
For the year ended September 30, 2023, the Company recognized PIK and non-cash dividend income of $14,901 which were capitalized into the cost basis of certain preferred equity
investments. For the years ended September 30, 2022 and 2021, the Company had no capitalized PIK and non-cash dividends. For the year ended September 30, 2023, the Company
received $10 of cash payments of accrued and capitalized preferred dividends. For the years ended September 30, 2022 and 2021, the Company received no cash payments of
accrued and capitalized preferred dividends in cash.
Dividend income on common equity securities is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded portfolio companies. Each
distribution received from limited liability company (“LLC”) and limited partnership (“LP”) investments is evaluated to determine if the distribution should be recorded as dividend income
or a return of capital. Generally, the Company will not record distributions from equity investments in LLCs and LPs as dividend income unless there are sufficient accumulated tax-
basis earnings and profits in the LLC or LP prior to the distribution. Distributions that are classified as a return of capital are recorded as a reduction in the cost basis of the investment.
For the years ended September 30, 2023, 2022 and 2021, the Company recorded dividend income received in cash of $1,340, $684 and $1,713, respectively, and return of capital
distributions received in cash of $373, $1,146 and $542, respectively.
Investment transactions are accounted for on a trade-date basis. Realized gains or losses on investments are measured by the difference between the net proceeds from the
disposition and the amortized cost basis of investment, without regard to unrealized gains or losses previously recognized. The Company reports current period changes in fair value of
investments that are measured at fair value as a component of the net change in unrealized appreciation (depreciation) on investment transactions in the Consolidated Statements of
Operations.
Non-accrual loans: A loan can be left on accrual status during the period the Company is pursuing repayment of the loan. Management reviews all loans that become 90 days or more
past due on principal and interest, or when there is reasonable doubt that principal or interest will be collected, for possible placement on non-accrual status. When a loan is placed on
non-accrual status, unpaid interest credited to income is reversed. Additionally, any original issue discount and market discount are no longer accreted to interest income as of the date
the loan is placed on non-accrual status. Interest payments received on non-accrual loans are recognized as income or applied to principal depending upon management’s judgment.
Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management’s judgment, payments are likely to remain current. The total fair value
of non-accrual loans was $62,937 and $65,125 as of September 30, 2023 and September 30, 2022, respectively.
Purchase accounting: Pursuant to the Merger Agreement, Merger Sub was first merged with and into GCIC, with GCIC as the surviving company (the “Initial Merger”), and,
immediately following the Initial Merger, GCIC was then merged with and into the Company, with the Company as the surviving company (the Initial Merger and the subsequent
merger, collectively, the “Merger”). The Merger was accounted for under the asset acquisition method of accounting in accordance with ASC 805 — Business Combinations — Related
Issues (“ASC Topic 805”), also referred to as “purchase accounting.” Under asset acquisition accounting, acquiring assets in groups not only requires ascertaining the cost of the asset
(or net assets), but also allocating that cost to the individual assets (or individual assets and liabilities) that make up the group. Per ASC Topic 805, assets are recognized based on
their cost to the acquiring entity, which generally includes transaction costs of the asset acquisition, and no gain or loss is recognized unless the fair value of non-cash assets given as
consideration differs from the assets carrying amounts on the acquiring entity’s books.
The cost of the group of assets acquired in an asset acquisition is allocated to the individual assets acquired or liabilities assumed based on the relative fair values of net identifiable
assets acquired other than “non-qualifying” assets (for example cash) and does not give rise to goodwill. To the extent that the consideration paid to GCIC’s stockholders exceeded the
relative fair values of the net identifiable assets of GCIC acquired other than “non-
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
qualifying” assets, any such premium paid by the Company was further allocated to the cost of the GCIC assets acquired by the Company pro-rata to their relative fair value, other than
“non-qualifying” assets. As GCIC did not have any “qualifying” assets at the time of acquisition, the premium was allocated to “non-qualifying” assets, which are GCIC’s investments in
loans and equity securities, including its investment in GCIC SLF. Immediately following the acquisition of GCIC, the Company recorded its assets at their respective fair values and, as
a result, the purchase premium allocated to the cost basis of the GCIC assets acquired was immediately recognized as unrealized depreciation on the Company's Consolidated
Statement of Operations. The purchase premium allocated to investments in loan securities will amortize over the life of the loans through interest income, with a corresponding
reversal of the unrealized depreciation on the loans acquired from GCIC through their ultimate disposition. Amortization expense of purchase premium for the years ended September
30, 2023, 2022 and 2021 was $7,073, $15,632 and $30,793, respectively. The purchase premium allocated to investments in equity securities will not amortize over the life of the
equity securities through interest income and, assuming no subsequent change to the fair value of the equity securities acquired from GCIC and disposition of such equity securities at
fair value, the Company will recognize a realized loss with a corresponding reversal of the unrealized depreciation upon disposition of the equity securities acquired from GCIC.
Income taxes: The Company has elected to be treated as a RIC under Subchapter M of the Code and operates in a manner so as to qualify for the tax treatment applicable to RICs. In
order to qualify and be subject to tax as a RIC, among other things, the Company is required to meet certain source of income and asset diversification requirements and timely
distribute dividends for U.S. federal income tax purposes to its stockholders of an amount generally at least equal to 90% of investment company taxable income, as defined by the
Code and determined without regard to any deduction for dividends paid, for each tax year. The Company has made, and intends to continue to make, the requisite distributions to its
stockholders, which will generally relieve the Company from U.S. federal income taxes with respect to all income distributed to its stockholders.
Depending on the level of taxable income earned in a tax year, the Company can determine to retain taxable income in excess of current year dividend distributions and distribute such
taxable income in the next tax year. The Company may then be required to incur a 4% excise tax on such income. To the extent that the Company determines that its estimated current
year annual taxable income, determined on a calendar year basis, could exceed estimated current calendar year dividend distributions, the Company accrues excise tax, if any, on
estimated excess taxable income as taxable income is earned. For the year ended September 30, 2023, $3,682 was recorded for U.S. federal excise tax. For the years ended
September 30, 2022 and 2021, the Company did not record any U.S. federal excise tax.
The Company accounts for income taxes in conformity with ASC Topic 740 — Income Taxes (“ASC Topic 740”). ASC Topic 740 provides guidelines for how uncertain tax positions
should be recognized, measured, presented and disclosed in the consolidated financial statements. ASC Topic 740 requires the evaluation of tax positions taken in the course of
preparing the Company’s tax returns to determine whether the tax positions are “more-likely-than-not” to be sustained by the applicable tax authority. Tax benefits of positions not
deemed to meet the more-likely-than-not threshold would be recorded as a tax expense or tax benefit in the current year. It is the Company’s policy to recognize accrued interest and
penalties related to uncertain tax benefits in income tax expense. There were no material unrecognized tax benefits or unrecognized tax liabilities related to uncertain income tax
positions through September 30, 2023. The Company's tax returns for the 2020 through 2022 tax years remain subject to examination by U.S. federal and most state tax authorities.
Certain of the Company's consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes. Income tax expense, if any, is included under the income
category for which it applies in the Consolidated Statements of Operations.
Dividends and distributions: Dividends and distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid out as a dividend or distribution is
determined by the Board each quarter and is generally based upon the earnings estimated by management. Net realized capital gains, if any, are distributed at least annually, although
the Company can retain such capital gains for investment in its discretion.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The Company has adopted a dividend reinvestment plan (“DRIP”) that provides for reinvestment of any distributions the Company declares in cash on behalf of its stockholders, unless
a stockholder elects to receive cash. As a result, if the Board authorizes and the Company declares a cash distribution, then stockholders who participate in the DRIP will have their
cash distribution reinvested in additional shares of the Company’s common stock, rather than receiving the cash distribution. The Company expects to use newly issued shares under
the guidelines of the DRIP if the Company’s shares are trading at a premium to net asset value. The Company can purchase shares in the open market in connection with the
obligations under the plan, and in particular, if the Company’s shares are trading at a significant discount to net asset value (“NAV”) and the Company is otherwise permitted under
applicable law to purchase such shares, the Company intends to purchase shares in the open market in connection with any obligations under the DRIP.
In the event the market price per share of the Company’s common stock on the date of a distribution exceeds the most recently computed NAV per share of the common stock, the
Company will issue shares of common stock to participants in the DRIP at the greater of the most recently computed NAV per share of common stock or 95% of the current market
price per share of common stock (or such lesser discount to the current market price per share that still exceeds the most recently computed NAV per share of common stock).
Share repurchase plan: The Company has a share repurchase program (the “Program”) which allows the Company to repurchase the Company’s outstanding common stock on the
open market at prices below the Company’s NAV as reported in its most recently published consolidated financial statements. The Board reapproved the Program in August 2023 and
the Program is implemented at the discretion of management. Shares can be purchased from time to time at prevailing market prices, through open market transactions, including block
transactions. The Program permits repurchases up to $150,000 of the Company's common stock. Refer to Note 12 for more information on the share repurchases under the Program.
Equity Distribution Agreement: On May 28, 2021, the Company entered into an equity distribution agreement (the “Equity Distribution Agreement ”), by and among the Company, the
Investment Adviser, Golub Capital LLC and SMBC Nikko Securities America, Inc. (the “Placement Agent”), in connection with the sale by the Company of shares of its common stock,
having an aggregate offering price of up to $250,000, in an “at the market offering,” in amounts and at times to be determined by the Company. Actual sales, if any, will depend on a
variety of factors to be determined by the Company from time to time, including, among others, market conditions and the market price of the Company’s common stock. The Equity
Distribution Agreement provides that the Company may offer and sell shares from time to time through the Placement Agent, or to it. Sales of the shares, if any, may be made in
negotiated transactions or transactions that are deemed to be “at the market,” as defined in Rule 415 under the Securities Act of 1933, as amended, including sales made directly on
The Nasdaq Global Select Market or any similar securities exchange or sales made to or through a market maker other than on a securities exchange, at prices related to the prevailing
market prices or at negotiated prices. Pursuant to the terms of the Equity Distribution Agreement, the Placement Agent will receive a commission from the Company of up to 1.25% of
the gross sales price of any shares sold through the Placement Agent under the Equity Distribution Agreement. Offering costs for the Equity Distribution Agreement are charged
against the proceeds from equity offerings when proceeds are received. During the years ended September 30, 2023, 2022 and 2021, the Company did not issue any shares of
common stock under the Equity Distribution Agreement.
Deferred debt issuance costs: Deferred debt issuance costs represent fees and other direct incremental costs incurred in connection with the Company’s borrowings. As of
September 30, 2023 and September 30, 2022, the Company had deferred debt issuance costs of $15,613 and $17,211, respectively. These amounts are amortized and included in
interest expense in the Consolidated Statements of Operations over the estimated average life of the borrowings. Amortization expense for deferred debt issuance costs for the years
ended September 30, 2023, 2022 and 2021 was $7,380, $7,337 and $10,203, respectively.
Deferred offering costs: Deferred offering costs consist of fees paid in relation to legal, accounting, regulatory and printing work completed in preparation of equity offerings. Deferred
offering costs are charged against the proceeds from equity offerings when received. These amounts are included in other assets on the Consolidated Statements of Financial
Condition.
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Note 3. Related Party Transactions
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Investment Advisory Agreement: Under the Investment Advisory Agreement, the Investment Adviser manages the day-to-day operations of, and provides investment advisory
services to, GBDC. The Board most recently approved the amended and restated Investment Advisory Agreement on August 3, 2023, effective as of July 1, 2023, pursuant to which
the base management fee rate was reduced from 1.375% to 1.0%. The Investment Adviser is a registered investment adviser with the U.S. Securities and Exchange Commission (the
“SEC”). The Investment Adviser receives fees for providing services, consisting of two components, a base management fee and an Incentive Fee (as defined below).
The base management fee is calculated at an annual rate equal to 1.0% (or 1.375% for periods ending on or before June 30, 2023) of the fair value of the average adjusted gross
assets of the Company at the end of the two most recently completed calendar quarters (including assets purchased with borrowed funds and securitization-related assets, leverage,
unrealized depreciation or appreciation on derivative instruments and cash collateral on deposit for such derivative instruments with custodian but adjusted to exclude cash and cash
equivalents so that investors do not pay the base management fee on such assets) and is payable quarterly in arrears. Additionally, the Investment Adviser voluntarily excludes any
assets funded with secured borrowing proceeds from the base management fee calculation. The base management fee is adjusted, based on the actual number of days elapsed
relative to the total number of days in such calendar quarter, for any share issuances or repurchases during such calendar quarter. For purposes of the Investment Advisory
Agreement, cash equivalents mean U.S. government securities and commercial paper instruments maturing within 270 days of purchase (which is different than the GAAP definition,
which defines cash equivalents as U.S. government securities and commercial paper instruments maturing within 90 days of purchase). To the extent that the Investment Adviser or
any of its affiliates provides investment advisory, collateral management or other similar services to a subsidiary of the Company, the base management fee will be reduced by an
amount equal to the product of (1) the total fees paid to the Investment Adviser by such subsidiary for such services and (2) the percentage of such subsidiary’s total equity, including
membership interests and any class of notes not exclusively held by one or more third parties, that is owned, directly or indirectly, by the Company.
The Investment Adviser served as collateral manager under the 2020 Collateral Management Agreement (as defined
in Note 7) and serves as collateral manager under the 2018 Collateral Management Agreement (as defined in Note 7) and the GCIC 2018 Collateral Management Agreement (as
defined in Note 7). Fees payable to the Investment Adviser for providing these services are offset against the base management fee payable by the Company under the Investment
Advisory Agreement.
The base management fee incurred for the year ended September 30, 2023, was $70,802.
During the three months ended March 31, 2022, the Investment Adviser irrevocably waived $1,904 of base management fees. After taking into account the waiver by the Investment
Adviser, the base management fee incurred was $71,962 rather than $73,866 for the year ended September 30, 2022.
During the year ended September 30, 2021, the Investment Adviser irrevocably waived $4,000 of base management fees. After taking into account the waiver by the Investment
Adviser, the base management fee incurred was $57,858 rather than $61,858 for the year ended September 30, 2021.
The Company has structured the calculation of the Incentive Fee to include a fee limitation such that an Incentive Fee for any quarter can only be paid to the Investment Adviser if,
after such payment, the cumulative Incentive Fees paid to the Investment Adviser, calculated on a per share basis, since April 13, 2010, the effective date of the Company’s election to
become a BDC, would be less than or equal to 20.0% of the Company’s Cumulative Pre-Incentive Fee Net Income (as defined below).
The Company accomplishes this limitation by subjecting each quarterly Incentive Fee payable under the Income and Capital Gain Incentive Fee Calculation (as defined below) to a cap
(the “Incentive Fee Cap”). Under the Investment Advisory Agreement, the Incentive Fee Cap in any quarter is equal to the difference between (a) 20.0% of Cumulative Pre-Incentive
Fee Net Income Per Share (as defined below) and (b) Cumulative Incentive Fees Paid Per Share (as defined below). To the extent the Incentive Fee Cap is zero or a negative value in
any quarter, no Incentive Fee would be payable in that quarter. If, for any relevant period, the Incentive Fee Cap calculation results in the Company paying less than the amount of the
Incentive Fee calculated above, then the difference between the Incentive Fee and the Incentive Fee Cap will not be paid by GBDC and will not be received by the Investment
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Adviser as an Incentive Fee either at the end of such relevant period or at the end of any future period. “Cumulative Pre-Incentive Fee Net Income Per Share” equals the sum of “Pre-
Incentive Fee Net Income Per Share” (as defined below) for each quarterly period since April 13, 2010. “Pre-Incentive Fee Net Income Per Share” equals the sum of (i) Pre-Incentive
Fee Net Investment Income (as defined below) and (ii) Adjusted Capital Returns for the applicable period, divided by (b) the weighted average number of shares of GBDC common
stock outstanding during such period. “Adjusted Capital Returns” for any period is the sum of the realized aggregate capital gains, realized aggregate capital losses, aggregate
unrealized capital depreciation and aggregate unrealized capital appreciation for such period; provided that the calculation of realized aggregate capital gains, realized aggregate
capital losses, aggregate unrealized capital depreciation and aggregate unrealized capital appreciation shall not include any realized capital gains, realized capital losses or unrealized
capital appreciation or depreciation resulting solely from the purchase accounting for any premium or discount paid for the acquisition of assets in a merger. “Cumulative Incentive Fees
Paid Per Share” is equal to the sum of Incentive Fees Paid Per Share since April 13, 2010. “Incentive Fees Paid Per Share” for any period is equal to the Incentive Fees accrued
and/or payable to the Company for such period, divided by the weighted average number of shares of common stock of GBDC during such period.
“Pre-Incentive Fee Net Investment Income” means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring,
diligence and consulting fees or other fees that the Company receives from portfolio companies but excluding fees for providing managerial assistance) accrued during the calendar
quarter, minus operating expenses for the calendar quarter (including the base management fee, taxes, any expenses payable under the Investment Advisory Agreement and the
Administration Agreement, any expenses of securitizations and any interest expense and dividends paid on any outstanding preferred stock, but excluding the Incentive Fee). Pre-
Incentive Fee Net Investment Income includes, in the case of investments with a deferred interest feature such as market discount, debt instruments with PIK interest, preferred stock
with PIK dividends and zero coupon securities, accrued income that the Company has not yet received in cash.
Incentive Fees are calculated and payable quarterly in arrears (or, upon termination of the Investment Advisory Agreement, as of the termination date).
The income and capital gains incentive fee calculation (the “Income and Capital Gain Incentive Fee Calculation”) has two parts, the income component (the “Income Incentive Fee”)
and the capital gains component (the “Capital Gain Incentive Fee” and, together with the Income Incentive Fee, the “Incentive Fee”). The Income Incentive Fee is calculated quarterly
in arrears based on the Company’s Pre-Incentive Fee Net Investment Income for the immediately preceding calendar quarter.
For the years ended September 30, 2023, 2022 and 2021, the Income Incentive Fee incurred was $74,066, $17,756 and $3,214, respectively.
The Investment Advisory Agreement excludes the impact of purchase accounting resulting from a merger, including the Merger, from the calculation of income subject to the Income
Incentive Fee and the calculation of the Incentive Fee Cap. As a result, under the Investment Advisory Agreement, Pre-Incentive Fee Net Investment Income does not include any
realized capital gains, realized capital losses or unrealized capital appreciation or depreciation or any amortization or accretion of any purchase premium or discount to interest income
solely from the purchase accounting for any premium or discount paid for the acquisition of assets in a merger, such as the premium to net asset value paid for the shares of GCIC
common stock in the Merger. Because of the structure of the Income Incentive Fee, it is possible that an Incentive Fee is calculated under this formula with respect to a period in which
the Company has incurred a loss. For example, if the Company receives Pre-Incentive Fee Net Investment Income in excess of the hurdle rate (as defined below) for a calendar
quarter, the Income Incentive Fee will result in a positive value and an Incentive Fee will be paid even if the Company has incurred a loss in such period due to realized and/or
unrealized capital losses unless the payment of such Incentive Fee would cause the Company to pay Incentive Fees on a cumulative basis that exceed the Incentive Fee Cap.
Pre-Incentive Fee Net Investment Income, expressed as a rate of return on the value of the Company’s net assets (defined as total assets less indebtedness and before taking into
account any Incentive Fees payable during the period) at the end of the immediately preceding calendar quarter, is compared to a fixed “hurdle rate” of 2.0% quarterly.
230
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
If market interest rates rise, it is possible that the Company will be able to invest funds in debt instruments that provide for a higher return, which would increase Pre-Incentive Fee Net
Investment Income and make it easier for the Investment Adviser to surpass the fixed hurdle rate and receive an Incentive Fee based on such net investment income.
The Company’s Pre-Incentive Fee Net Investment Income used to calculate this part of the Incentive Fee is also included in the amount of the Company’s total assets (excluding cash
and cash equivalents but including assets purchased with borrowed funds and securitization-related assets, unrealized depreciation or appreciation on derivative instruments and cash
collateral on deposit with custodian) used to calculate the base management fee annual rate.
The Company calculates the Income Incentive Fee with respect to its Pre-Incentive Fee Net Investment Income quarterly, in arrears, as follows:
•
•
•
Zero in any calendar quarter in which the Pre-Incentive Fee Net Investment Income does not exceed the hurdle rate;
100% of the Company’s Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee Net Investment Income, if any, that exceeds the hurdle
rate but is less than 2.5% in any calendar quarter. This portion of the Company’s Pre-Incentive Fee Net Investment Income (which exceeds the hurdle rate but is less than
2.5%) is referred to as the “catch-up” provision. The catch-up is meant to provide the Investment Adviser with 20.0% of the Pre-Incentive Fee Net Investment Income as if a
hurdle rate did not apply if the Company’s Pre-Incentive Fee Net Investment Income exceeds 2.5% in any calendar quarter; and
20.0% of the amount of the Company’s Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.5% in any calendar quarter.
The Capital Gain Incentive Fee equals (a) 20.0% of the Company’s Capital Gain Incentive Fee Base (as defined below), if any, calculated in arrears as of the end of each calendar year
(or upon termination of the Investment Advisory Agreement, as of the termination date), which commenced with the calendar year ending December 31, 2010, less (b) the aggregate
amount of any previously paid Capital Gain Incentive Fees. The Company’s “Capital Gain Incentive Fee Base” equals (1) the sum of (A) realized capital gains, if any, on a cumulative
positive basis from the date the Company elected to become a BDC through the end of each calendar year, (B) all realized capital losses on a cumulative basis and (C) all unrealized
capital depreciation on a cumulative basis less (2) all unamortized deferred debt issuance costs, if and to the extent such costs exceed all unrealized capital appreciation on a
cumulative basis.
•
•
•
The cumulative aggregate realized capital losses are calculated as the sum of the amounts by which (a) the net sales price of each investment in the Company’s portfolio when
sold is less than (b) the accreted or amortized cost basis of such investment.
The cumulative aggregate realized capital gains are calculated as the sum of the differences, if positive, between (a) the net sales price of each investment in the Company’s
portfolio when sold and (b) the accreted or amortized cost basis of such investment.
The aggregate unrealized capital depreciation is calculated as the sum of the differences, if negative, between (a) the valuation of each investment in the Company’s portfolio
as of the applicable Capital Gain Incentive Fee calculation date and (b) the accreted or amortized cost basis of such investment.
Realized capital gains and losses include gains and losses on investments, foreign currencies, including gains and losses on borrowings in foreign currencies, derivative contracts and
any income tax related to cumulative aggregate realized gains and losses.
For the years ended September 30, 2023, 2022 and 2021, the Company did not accrue a Capital Gain Incentive Fee. As of September 30, 2023 and September 30, 2022, there was
no Capital Gain Incentive Fee payable as calculated under the Investment Advisory Agreement as described above. Any payment due for a Capital Gain Incentive Fee under the terms
of the Investment Advisory Agreement is calculated in arrears at the end of each calendar year.
In accordance with GAAP, the Company also is required to include the aggregate unrealized capital appreciation on investments in the calculation and accrue a capital gain incentive
fee on a quarterly basis as if such unrealized capital
231
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the Investment Advisory
Agreement, as applicable. If the Capital Gain Incentive Fee Base, adjusted as required by GAAP to include unrealized capital appreciation, is positive at the end of a period, then
GAAP requires the Company to accrue a capital gain incentive fee equal to 20% of such amount, less the aggregate amount of the actual Capital Gain Incentive Fees paid and capital
gain incentive fees accrued under GAAP in all prior periods. If such amount is negative, then there is no accrual for such period. The resulting accrual under GAAP in a given period
results in additional expense if such cumulative amount is greater than in the prior period or a reversal of previously recorded expense if such cumulative amount is less than in the
prior period. There can be no assurance that such unrealized capital appreciation will be realized in the future. For the years ended September 30, 2023, 2022 and 2021, the Company
did not accrue a capital gain incentive fee under GAAP. Changes in the accrual for the capital gain incentive fee under GAAP are included in incentive fee in the Consolidated
Statements of Operations. As of both September 30, 2023 and September 30, 2022, there was no cumulative accrual of capital gain incentive fees under GAAP included in
management and incentive fees payable on the Consolidated Statements of Financial Condition.
Administration Agreement: Under the Administration Agreement, the Administrator furnishes the Company with office facilities and equipment, provides the Company with clerical,
bookkeeping and record keeping services at such facilities and provides the Company with other administrative services as the Administrator, subject to review by the Board,
determines necessary to conduct the Company’s day-to-day operations. The Company reimburses the Administrator the allocable portion of overhead and other expenses incurred by
it in performing its obligations under the Administration Agreement, including rent, fees and expenses associated with performing compliance functions and the Company's allocable
portion of the cost of its chief financial officer and chief compliance officer and their respective staffs. The Board reviews such expenses to determine that these expenses, including any
allocation of expenses among the Company and other entities for which the Administrator provides similar services, are reasonable and comparable to administrative services charged
by unaffiliated third party asset managers. Under the Administration Agreement, the Administrator also provides, on the Company’s behalf, managerial assistance to those portfolio
companies to which the Company is required to provide such assistance and will be paid an additional amount based on the cost of the services provided, which amount shall not
exceed the amount the Company receives from such portfolio companies.
Included in accounts payable and other liabilities is $2,118 and $1,976 as of September 30, 2023 and September 30, 2022, respectively, for accrued allocated shared services under
the Administration Agreement.
Other related party transactions: The Administrator pays for certain unaffiliated third-party expenses incurred by the Company. Such expenses include postage, printing, office
supplies, rating agency fees and professional fees. These expenses are not marked-up and represent the same amount the Company would have paid had the Company paid the
expenses directly. These expenses are subsequently reimbursed in cash.
Total expenses reimbursed to the Administrator during the years ended September 30, 2023, 2022 and 2021, were $8,158, $6,240 and $6,950, respectively.
As of September 30, 2023 and September 30, 2022, included in accounts payable and other liabilities were $2,017 and $2,049, respectively, for expenses paid on behalf of the
Company by the Administrator.
The Company is party to an unsecured revolving credit facility with the Investment Adviser (as amended, the “Adviser Revolver”) which, as of September 30, 2023 and September 30,
2022 permits the Company to borrow a maximum of $100,000 and expires on June 15, 2025. Refer to Note 7 Borrowings for discussion of the Adviser Revolver.
232
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Note 4. Investments
Investments as of September 30, 2023 and September 30, 2022 consisted of the following:
Senior secured
One stop
Second lien
Subordinated debt
Equity
Total
Principal
As of September 30, 2023
Amortized
Cost
Fair
Value
Principal
As of September 30, 2022
Amortized
Cost
Fair
Value
$
$
518,721
4,812,987
32,173
8,907
N/A
5,372,788
$
$
527,449
4,763,128
33,514
7,866
261,879
5,593,836
$
$
503,985
4,678,099
29,154
7,945
297,430
5,516,613
$
$
519,188
4,801,600
25,801
3,869
N/A
5,350,458
$
$
518,216
4,786,118
29,337
3,814
232,119
5,569,604
$
$
472,873
4,668,609
23,240
3,815
277,819
5,446,356
233
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The following tables show the portfolio composition by geographic region at amortized cost and fair value as a percentage of total investments in portfolio companies. The geographic
composition is determined by the location of the corporate headquarters of the portfolio company, which is not always indicative of the primary source of the portfolio company’s
business.
As of September 30, 2023
As of September 30, 2022
Amortized Cost:
United States
Mid-Atlantic
Midwest
West
Southeast
Southwest
Northeast
Canada
United Kingdom
Australia
Luxembourg
Netherlands
Finland
Sweden
Israel
Denmark
Total
Fair Value:
United States
Mid-Atlantic
Midwest
West
Southeast
Southwest
Northeast
Canada
United Kingdom
Australia
Luxembourg
Netherlands
Finland
Sweden
Israel
Denmark
Total
* Represents an amount less than 0.1%
16.7 % $
19.0
16.0
19.6
8.7
8.3
3.1
5.5
0.3
0.5
1.4
0.5
0.3
0.0 *
0.1
100.0 % $
17.0 % $
19.0
16.1
19.8
8.8
8.1
2.9
5.2
0.3
0.5
1.3
0.6
0.3
0.0 *
0.1
100.0 % $
872,311
1,043,468
985,463
1,084,332
461,627
491,675
212,701
263,815
17,177
25,476
61,319
30,386
16,213
508
3,133
5,569,604
843,796
1,024,529
980,751
1,082,651
459,971
479,291
207,537
225,308
16,248
23,978
53,140
29,813
15,709
508
3,126
5,446,356
15.7 %
18.7
17.7
19.5
8.3
8.8
3.8
4.7
0.3
0.5
1.1
0.5
0.3
0.0 *
0.1
100.0 %
15.5 %
18.8
18.0
19.9
8.4
8.8
3.8
4.2
0.3
0.4
1.0
0.5
0.3
0.0 *
0.1
100.0 %
$
$
$
$
936,563
1,061,739
895,353
1,092,833
487,270
461,711
170,492
308,977
17,050
29,523
80,112
30,455
18,099
508
3,151
5,593,836
937,002
1,046,284
887,364
1,094,393
484,949
448,383
161,668
287,313
16,075
28,486
69,730
32,488
18,650
612
3,216
5,516,613
234
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The industry compositions of the portfolio at amortized cost and fair value as of September 30, 2023 and September 30, 2022 were as follows:
As of September 30, 2023
As of September 30, 2022
Amortized Cost:
Aerospace and Defense
Airlines
Auto Components
Automobiles
Beverages
Biotechnology
Building Products
Chemicals
Commercial Services and Supplies
Communications Equipment
Containers and Packaging
Distributors
Diversified Consumer Services
Diversified Financial Services
Diversified Telecommunication Services
Electronic Equipment, Instruments and Components
Energy Equipment and Services
Food and Staples Retailing
Food Products
Healthcare Equipment and Supplies
Healthcare Providers and Services
Health Care Technology
Hotels, Restaurants and Leisure
Household Durables
Household Products
Industrial Conglomerates
Insurance
Internet and Catalog Retail
IT Services
Leisure Products
Life Sciences Tools & Services
Machinery
Marine
Media
Multiline Retail
Oil, Gas and Consumable Fuels
Paper and Forest Products
Personal Products
Pharmaceuticals
Professional Services
Real Estate Management and Development
Road and Rail
Software
Specialty Retail
Technology Hardware, Storage and Peripherals
Textiles, Apparel and Luxury Goods
Trading Companies and Distributors
Water Utilities
Total
* Represents an amount less than 0.1%.
0.4 %
0.0 *
0.7
4.9
1.0
0.0 *
0.3
1.6
2.8
0.2
0.8
—
4.9
0.8
0.0 *
0.4
0.1
1.1
2.8
2.4
8.4
4.0
2.3
0.1
0.1
0.7
4.4
1.2
4.8
0.2
1.3
0.6
0.4
0.1
0.8
2.1
0.2
0.7
3.1
2.2
2.4
0.7
26.2
5.6
0.4
0.8
0.7
0.3
100.0 %
$
$
65,825
961
41,487
262,821
59,650
1,769
17,764
87,657
137,435
11,414
44,094
5,942
241,453
27,160
1,609
137,087
4,700
83,134
135,841
141,925
492,321
197,946
132,351
8,897
5,473
31,560
232,074
61,193
264,343
11,797
50,125
34,594
18,813
6,396
45,090
92,234
10,579
36,654
154,608
116,650
123,697
35,801
1,410,563
365,734
23,269
44,882
34,410
17,822
5,569,604
1.2 %
0.0 *
0.7
4.7
1.1
0.0 *
0.3
1.6
2.5
0.2
0.8
0.1
4.3
0.5
0.0 *
2.5
0.1
1.5
2.4
2.5
8.8
3.6
2.4
0.2
0.1
0.6
4.2
1.1
4.8
0.2
0.9
0.6
0.3
0.1
0.8
1.7
0.2
0.7
2.8
2.1
2.2
0.6
25.3
6.6
0.4
0.8
0.6
0.3
100.0 %
24,860
955
41,234
273,381
53,386
1,769
18,282
87,729
156,336
11,448
46,372
—
271,430
44,183
1,601
24,389
4,605
62,592
154,596
136,283
468,748
220,862
130,946
6,688
5,410
39,570
247,825
67,793
270,772
11,557
72,065
34,336
19,490
6,351
45,113
117,176
10,481
36,551
171,783
123,318
131,488
38,921
1,462,611
313,197
23,546
44,256
38,403
19,148
5,593,836
$
$
235
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
As of September 30, 2023
As of September 30, 2022
Fair Value:
Aerospace and Defense
Airlines
Auto Components
Automobiles
Beverages
Biotechnology
Building Products
Chemicals
Commercial Services and Supplies
Communications Equipment
Containers and Packaging
Distributors
Diversified Consumer Services
Diversified Financial Services
Diversified Telecommunication Services
Electronic Equipment, Instruments and Components
Energy Equipment and Services
Food and Staples Retailing
Food Products
Healthcare Equipment and Supplies
Healthcare Providers and Services
Health Care Technology
Hotels, Restaurants and Leisure
Household Durables
Household Products
Industrial Conglomerates
Insurance
Internet and Catalog Retail
IT Services
Leisure Products
Life Sciences Tools & Services
Machinery
Marine
Media
Multiline Retail
Oil, Gas and Consumable Fuels
Paper and Forest Products
Personal Products
Pharmaceuticals
Professional Services
Real Estate Management and Development
Road and Rail
Software
Specialty Retail
Technology Hardware, Storage and Peripherals
Textiles, Apparel and Luxury Goods
Trading Companies and Distributors
Water Utilities
Total
* Represents an amount less than 0.1%.
0.5 %
0.0 *
0.7
4.9
0.9
0.0 *
0.3
1.4
2.9
0.2
0.8
—
4.9
0.8
0.0 *
0.5
0.0 *
1.0
2.9
2.4
8.2
4.1
2.4
0.1
0.1
0.7
4.5
1.3
4.7
0.3
1.3
0.6
0.4
0.1
0.8
2.2
0.2
0.6
2.9
2.2
2.3
0.7
26.4
5.6
0.4
0.8
0.7
0.3
100.0 %
$
$
64,365
926
41,026
260,506
57,804
1,536
17,770
79,461
135,584
11,162
44,198
5,941
236,896
26,928
1,628
138,011
1,740
84,744
136,802
131,962
444,736
200,658
134,159
9,275
5,265
30,407
226,158
61,299
249,240
13,478
49,478
31,750
18,399
6,503
45,138
90,054
10,640
33,869
150,263
116,622
119,120
35,742
1,401,424
367,521
22,852
42,302
33,597
17,417
5,446,356
1.2 %
0.0 *
0.8
4.8
1.1
0.0 *
0.3
1.5
2.5
0.2
0.8
0.1
4.3
0.5
0.0 *
2.5
0.0 *
1.6
2.5
2.4
8.2
3.7
2.5
0.2
0.1
0.6
4.2
1.1
4.6
0.2
0.9
0.6
0.3
0.1
0.8
1.7
0.2
0.6
2.8
2.1
2.2
0.7
25.7
6.7
0.4
0.8
0.6
0.3
100.0 %
25,557
917
39,648
270,598
49,787
1,315
18,278
75,851
159,232
11,358
45,597
—
271,351
44,147
1,612
24,967
1,353
56,675
158,312
132,677
451,795
222,984
132,972
6,891
5,217
39,056
246,424
70,228
260,877
13,162
72,077
33,082
19,053
6,179
45,138
117,897
9,991
34,489
162,335
123,807
128,483
39,047
1,455,863
308,126
23,350
43,696
36,734
18,428
5,516,613
$
$
236
TABLE OF CONTENTS
Note 5. Forward Currency Contracts
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The Company enters into forward currency contracts from time to time to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the
Company’s investments denominated in foreign currencies.
The outstanding forward currency contracts as of September 30, 2023 and September 30, 2022 were as follows:
As of September 30, 2023
Counterparty
Currency to be sold
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
As of September 30, 2022
Counterparty
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
Macquarie Bank Limited
$
$
£
$
£
€
£
$
€
£
£
£
€
€
£
$
$
$
£
$
£
€
£
$
€
15,600 CAD
30,000 CAD
25,000 GBP
22,600 CAD
20,550 GBP
26,000 EUR
13,945 GBP
7,000 CAD
10,100 EUR
Currency to be purchased
12,236 USD
23,399 USD
34,298 USD
17,739 USD
28,297 USD
31,803 USD
19,149 USD
5,386 USD
10,918 USD
$
$
$
$
$
$
$
$
$
Settlement date
8/27/2024
8/27/2024
8/27/2024
8/30/2024
9/3/2024
2/27/2025
3/31/2025
7/18/2025
7/21/2025
Currency to be sold
8,925 GBP
3,780 GBP
2,228 GBP
13,960 EUR
6,760 EUR
10,058 GBP
18,425 CAD
25,000 CAD
30,000 CAD
25,000 GBP
22,600 CAD
20,550 GBP
26,000 EUR
13,945 GBP
7,000 CAD
10,100 EUR
Currency to be purchased
11,219 USD
4,804 USD
2,903 USD
16,735 USD
8,044 USD
12,706 USD
13,783 USD
19,609 USD
23,399 USD
34,298 USD
17,739 USD
28,297 USD
31,803 USD
19,149 USD
5,386 USD
10,918 USD
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
Settlement date
2/28/2023
3/27/2023
4/28/2023
4/28/2023
4/28/2023
7/17/2023
10/30/2023
8/27/2024
8/27/2024
8/27/2024
8/30/2024
9/3/2024
2/27/2025
3/31/2025
7/18/2025
7/21/2025
Unrealized appreciation
($)
Unrealized
depreciation ($)
676
1,174
3,570
991
3,032
3,397
1,968
203
15,011
$
—
—
—
—
—
—
—
—
(70)
(70)
Unrealized
appreciation ($)
Unrealized depreciation
($)
1,226
572
408
2,778
1,287
1,459
372
1,267
1,399
6,285
1,156
5,265
4,637
3,538
236
448
32,333
$
$
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
$
$
$
In order to better define its contractual rights and to secure rights that will help the Company mitigate its counterparty risk, the Company has entered into an International Swaps and
Derivatives Association, Inc. Master Agreement (“ISDA Master Agreement”) with its derivative counterparty, Macquarie Bank Limited (“Macquarie”). The ISDA Master Agreement is a
bilateral agreement between the Company and Macquarie that governs over the counter (“OTC”) derivatives, including forward currency contracts, and contains, among other things,
collateral posting terms and netting provisions in the event of a default and/or termination event. The provisions of the ISDA
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Master Agreement permit a single net payment in the event of a default (close-out netting) or similar event, including the bankruptcy or insolvency of the counterparty.
For financial reporting purposes, cash collateral that has been pledged to cover obligations of the Company and cash collateral received from Macquarie, if any, is included in the
Consolidated Statements of Financial Condition as cash collateral held at broker for forward currency contracts or cash collateral received from broker for forward currency contracts.
The Company minimizes counterparty credit risk by only entering into agreements with counterparties that it believes to be of good standing and by monitoring the financial stability of
those counterparties.
The following table is intended to provide additional information about the effect of the forward currency contracts on the consolidated financial statements of the Company including:
the fair value of derivatives by risk category, the location of those fair values on the Consolidated Statements of Financial Condition, and the Company’s gross and net amount of
assets and liabilities available for offset under netting arrangements as well as any related collateral received or pledged by the Company as of September 30, 2023 and September
30, 2022.
As of September 30, 2023
Counterparty
Risk exposure category
Macquarie Bank Limited
Foreign exchange
As of September 30, 2022
Counterparty
Risk exposure category
Macquarie Bank Limited
Foreign exchange
$
$
Unrealized
appreciation on
forward currency
contracts
Unrealized depreciation
on forward currency
contracts
Net amounts presented
in the Consolidated
Statement of Financial
Condition
Collateral (Received)
Pledged
(1)
Net Amount
(2)
15,011
$
(70)
$
14,941
$
—
$
14,941
Unrealized
appreciation on
forward currency
contracts
Unrealized depreciation
on forward currency
contracts
Net amounts presented
in the Consolidated
Statement of Financial
Condition
Collateral (Received)
Pledged
(1)
Net Amount
(2)
32,333
$
—
$
32,333
$
—
$
32,333
(1)
(2)
The actual collateral pledged may be more than the amount shown due to over collateralization.
Represents the net amount due from/(to) counterparties in the event of default.
The impact of derivative transactions for the years ended September 30, 2023, 2022 and 2021 on the Consolidated Statements of Operations, including realized and unrealized gains
(losses) is summarized in the table below:
Realized gain (loss) on forward currency contracts recognized in income
Risk exposure category
Foreign exchange
Change in unrealized appreciation (depreciation) on forward currency contracts recognized in income
Risk exposure category
Foreign exchange
Year ended September 30,
2022
2,711
$
1,080
$
Year ended September 30,
2022
—
2021
2021
(17,392)
$
32,243
$
1,154
2023
2023
$
$
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The following table is a summary of the average outstanding daily volume for forward currency contracts for the years ended September 30, 2023, 2022 and 2021:
Average U.S. Dollar notional outstanding
2023
Year ended September 30,
2022
2021
Forward currency contracts
$
221,448
$
254,118
$
94,304
Exclusion of the Investment Adviser from Commodity Pool Operator Definition
Engaging in commodity interest transactions such as swap transactions or futures contracts for the Company may cause the Investment Adviser to fall within the definition of
“commodity pool operator” under the Commodity Exchange Act (the “CEA”) and related Commodity Futures Trading Commission (the “CFTC”) regulations. The Investment Adviser has
claimed an exclusion from the definition of the term “commodity pool operator” under the CEA and the CFTC regulations in connection with its management of the Company and,
therefore, is not subject to CFTC registration or regulation under the CEA as a commodity pool operator with respect to its management of the Company.
Note 6. Fair Value Measurements
The Company follows ASC Topic 820 for measuring fair value. Fair value is the price that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. Where available, fair value is based on observable market prices or parameters, or derived from such prices or parameters.
Where observable prices or inputs are not available, valuation models are applied. These valuation models involve some level of management estimation and judgment, the degree of
which is dependent on the price transparency for the assets or liabilities or market and the assets’ or liabilities’ complexity. The Company’s fair value analysis includes an analysis of
the value of any unfunded loan commitments. Assets and liabilities are categorized for disclosure purposes based upon the level of judgment associated with the inputs used to
measure their value. The valuation hierarchical levels are based upon the transparency of the inputs to the valuation of the asset or liability as of the measurement date. The three
levels are defined as follows:
Level 1: Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.
Level 2: Inputs include quoted prices for similar assets or liabilities in active markets and inputs that are observable for the assets or liabilities, either directly or indirectly, for
substantially the full term of the assets or liabilities.
Level 3: Inputs include significant unobservable inputs for the assets or liabilities and include situations where there is little, if any, market activity for the assets or liabilities. The
inputs into the determination of fair value are based upon the best information available and require significant management judgment or estimation.
In certain cases, the inputs used to measure fair value fall into different levels of the fair value hierarchy. In such cases, an asset’s or a liability’s categorization within the fair value
hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value
measurement in its entirety requires judgment and considers factors specific to the asset or liability. The Company assesses the levels of assets and liabilities at each measurement
date, and transfers between levels are recognized on the actual date of the event or change in circumstances that caused the transfers. There were no transfers among Level 1, 2 and
3 of the fair value hierarchy for assets and liabilities during the years ended September 30, 2023 and 2022. The following section describes the valuation techniques used by the
Company to measure different assets and liabilities at fair value and includes the level within the fair value hierarchy in which the assets and liabilities are categorized.
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Investments
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Level 1 investments are valued using quoted market prices. Level 2 investments are valued using market consensus prices that are corroborated by observable market data and
quoted market prices for similar assets and liabilities. Level 3 investments are valued at fair value as determined in good faith by the Board, based on input of management, the audit
committee and independent valuation firms that have been engaged at the direction of the Board to assist in the valuation of each portfolio investment without a readily available
market quotation at least once during a trailing twelve-month period under a valuation policy and a consistently applied valuation process. This valuation process is conducted at the
end of each fiscal quarter, with approximately 25% (based on the number of portfolio companies) of the Company’s valuations of debt and equity investments without readily available
market quotations subject to review by an independent valuation firm. All investments as of September 30, 2023, with the exception of one portfolio company investment (Level 1
investments), were valued using Level 3 inputs. All investments as of September 30, 2022 were valued using Level 3 inputs. As of September 30, 2023 and September 30, 2022, all
money market funds included in cash and cash equivalents and restricted cash and cash equivalents were valued using Level 1 inputs and all forward currency contracts were valued
using Level 2 inputs.
When determining fair value of Level 3 debt and equity investments, the Company takes into account the following factors, where relevant: the enterprise value of a portfolio company,
the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flows, the markets in which the portfolio
company does business, comparisons to publicly traded securities, and changes in the interest rate environment and the credit markets generally that affect the price at which similar
investments are made and other relevant factors. The primary method for determining enterprise value uses a multiple analysis whereby appropriate multiples are applied to the
portfolio company’s net income before net interest expense, income tax expense, depreciation and amortization (“EBITDA”). A portfolio company’s EBITDA can include pro forma
adjustments for items such as acquisitions, divestitures, or expense reductions. The enterprise value analysis is performed to determine the value of equity investments and to
determine if debt investments are credit impaired. If debt investments are credit impaired, the Company will use the enterprise value analysis or a liquidation basis analysis to
determine fair value. For debt investments that are not determined to be credit impaired, the Company uses a market interest rate yield analysis to determine fair value.
In addition, for certain debt investments, the Company bases its valuation on indicative bid and ask prices provided by an independent third party pricing service. Bid prices reflect the
highest price that the Company and others may be willing to pay. Ask prices represent the lowest price that the Company and others may be willing to accept. The Company generally
uses the midpoint of the bid/ask range as its best estimate of fair value of such investment.
Due to the inherent uncertainty of determining the fair value of Level 3 investments that do not have a readily available market value, the fair value of the investments may differ
significantly from the values that would have been used had a ready market existed for such investments and may differ materially from the values that are ultimately received or
settled. Further, such investments are generally subject to legal and other restrictions or otherwise are less liquid than publicly traded instruments. If the Company were required to
liquidate a portfolio investment in a forced or liquidation sale, the Company could realize significantly less than the value at which such investment had previously been recorded. The
Company’s investments are subject to market risk. Market risk is the potential for changes in the value due to market changes. Market risk is directly impacted by the volatility and
liquidity in the markets in which the investments are traded.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The following tables present fair value measurements of the Company’s investments and indicate the fair value hierarchy of the valuation techniques utilized by the Company to
determine such fair value as of September 30, 2023 and September 30, 2022:
As of September 30, 2023
Description
Assets, at fair value:
(1)
Debt investments
Equity investments
Money market funds
Forward currency contracts
Fair Value Measurements Using
Level 3
Level 2
Level 1
Total
(1)(2)
(1)
$
$
$
$
Total assets, at fair value:
Liabilities, at fair value:
Forward currency contracts
Total liabilities, at fair value:
As of September 30, 2022
Description
Assets, at fair value:
(1)
Debt investments
Equity investments
Money market funds
Forward currency contracts
(1)(2)
(1)
Total assets, at fair value:
$
$
$
$
$
—
100
72,822
—
72,922
$
$
$
$
$
Level 1
—
—
—
—
37,208
—
37,208
—
—
—
15,011
15,011
(70)
(70)
$
$
$
5,219,183
297,330
—
—
5,516,513
—
—
Fair Value Measurements Using
Level 3
Level 2
—
—
—
32,333
32,333
$
$
5,168,537
277,819
—
—
5,446,356
5,219,183
297,430
72,822
15,011
5,604,446
(70)
(70)
Total
5,168,537
277,819
37,208
32,333
5,515,897
$
$
$
$
$
(1)
(2)
Refer to the Consolidated Schedules of Investments for further details.
Included in cash and cash equivalents and restricted cash and cash equivalents on the Consolidated Statements of Financial Condition.
The net change in unrealized appreciation (depreciation) for the years ended September 30, 2023, 2022 and 2021, reported within the net change in unrealized appreciation
(depreciation) on investments in the Company's Consolidated Statements of Operations attributable to the Company's Level 3 assets held at the end of each year was $1,324,
$(119,448) and $68,612, respectively.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The following tables present the changes in investments measured at fair value using Level 3 inputs for the years ended September 30, 2023 and 2022:
Fair value, beginning of period
Net change in unrealized appreciation (depreciation) on investments
Net translation of investments in foreign currencies
Realized gain (loss) on investments
Realized gain (loss) on translation of investments in foreign currencies
Fundings of (proceeds from) revolving loans, net
Fundings of investments
PIK interest and non-cash dividends
Proceeds from non-cash dividends
Proceeds from principal payments and sales of portfolio investments
Accretion of discounts and amortization of premiums
Fair value, end of period
Fair value, beginning of period
Net change in unrealized appreciation (depreciation) on investments
Net translation of investments in foreign currencies
Realized gain (loss) on investments
Realized gain (loss) on translation of investments in foreign currencies
Funding of (proceeds from) revolving loans, net
Fundings of investments
PIK interest
Proceeds from principal payments and sales of portfolio investments
Accretion of discounts and amortization of premiums
Fair value, end of period
Debt
Investments
For the year ended September 30, 2023
Equity
Investments
Total
Investments
5,168,537
24,509
31,666
(48,084)
(1,419)
381
644,630
38,844
—
(652,759)
12,878
5,219,183
$
$
277,819
(10,231)
94
1,588
—
—
30,598
14,901
(10)
(17,429)
—
297,330
$
$
5,446,356
14,278
31,760
(46,496)
(1,419)
381
675,228
53,745
(10)
(670,188)
12,878
5,516,513
Debt
Investments
For the year ended September 30, 2022
Equity
Investments
Total
Investments
4,709,148
(53,378)
(65,751)
(852)
624
1,812
1,766,974
21,506
(1,220,593)
9,047
5,168,537
$
$
185,230
(3,365)
(179)
20,122
—
—
116,106
—
(40,095)
—
277,819
$
$
4,894,378
(56,743)
(65,930)
19,270
624
1,812
1,883,080
21,506
(1,260,688)
9,047
5,446,356
$
$
$
$
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The following tables present quantitative information about the significant unobservable inputs of the Company’s Level 3 investments as of September 30, 2023 and September 30,
2022.
Quantitative information about Level 3 Fair Value Measurements
Fair value as of September
30, 2023
Valuation Techniques
Unobservable Input
Range (Weighted Average)
(1)
Assets:
Senior secured loans
(2)
One stop loans
(3)(4)
Subordinated debt and second lien
loans
Equity
(5)
$
$
$
$
503,985 Yield analysis
Market comparable companies
4,678,099 Yield analysis
Market comparable companies
37,099 Yield analysis
Market comparable companies
297,330 Market comparable companies
Market interest rate
EBITDA multiples
Market interest rate
EBITDA multiples
Revenue multiples
Market interest rate
EBITDA multiples
EBITDA multiples
Revenue multiples
8.0% - 17.8% (10.6%)
5.2x - 24.0x (14.7x)
7.3% - 26.3% (10.9%)
4.0x - 34.0x (16.3x)
1.5x - 27.0x (7.7x)
10.3% - 24.5% (14.6%)
8.3x - 22.0x (19.5x)
5.2x - 35.0x (16.9x)
1.5x - 18.0x (9.6x)
(1)
(2)
(3)
(4)
(5)
Unobservable inputs were weighted by the relative fair value of the instruments.
$44,510 of loans at fair value were valued using the market comparable companies approach only.
$123,841 of loans at fair value were valued using the market comparable companies approach only.
The Company valued $3,895,527 and $782,572 of one stop loans using EBITDA and revenue multiples, respectively. All one stop loans were also valued using the market rate approach.
The Company valued $258,046 and $39,284 of equity investments using EBITDA and revenue multiples, respectively.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Quantitative information about Level 3 Fair Value Measurements
Fair value as of September
30, 2022
Valuation Techniques
Unobservable Input
Range
(Weighted Average)
(1)
Assets:
Senior secured loans
(2)
One stop loans
(3)(4)
Subordinated debt and second lien
loans
(5)
Equity
(5)
$
$
$
$
472,873 Yield analysis
Market comparable companies
— Collateral analysis
4,668,609 Yield analysis
Market comparable companies
27,055 Yield analysis
Market comparable companies
277,819 Market comparable companies
Market interest rate
EBITDA multiples
Recovery rate
Market interest rate
EBITDA multiples
Revenue multiples
Market interest rate
EBITDA multiples
EBITDA multiples
Revenue multiples
6.8% - 20.0% (9.6%)
6.5x - 26.2x (14.7x)
N/A
7.0% - 17.3% (9.6%)
4.5x - 37.3x (16.4x)
2.0x - 22.0x (8.3x)
9.8% - 13.8% (12.2%)
6.5x - 23.0x (21.0x)
4.5x - 38.0x (18.0x)
2.0x - 24.4x (12.6x)
(1)
(2)
(3)
(4)
(5)
Unobservable inputs were weighted by the relative fair value of the instruments.
$25,661 of loans at fair value were valued using the market comparable companies approach only.
$60,948 of loans at fair value were valued using the market comparable companies approach only.
The Company valued $4,009,492 and $659,117 of one stop loans using EBITDA and revenue multiples, respectively. All one stop loans were also valued using the market rate approach.
The Company valued $237,257 and $40,562 of equity investments using EBITDA and revenue multiples, respectively.
The above tables are not intended to be all-inclusive but rather to provide information on significant unobservable inputs and valuation techniques used by the Company.
The significant unobservable inputs used in the fair value measurement of the Company’s debt and equity investments are EBITDA multiples, revenue multiples and market interest
rates. The Company uses EBITDA multiples and, to a lesser extent, revenue multiples on its debt and equity investments to determine any credit gains or losses. Increases or
decreases in either of these inputs in isolation would have resulted in a significantly lower or higher fair value measurement. The Company uses market interest rates for loans to
determine if the effective yield on a loan is commensurate with the market yields for that type of loan. If a loan’s effective yield was significantly less than the market yield for a similar
loan with a similar credit profile, then the resulting fair value of the loan may have been lower.
Other Financial Assets and Liabilities
ASC Topic 820 requires disclosure of the fair value of financial instruments for which it is practical to estimate such value. As a result, with the exception of the line item titled “debt”
which is reported at cost, all assets and liabilities approximate fair value on the Consolidated Statements of Financial Condition due to their short maturity. The fair value of the
Company's 2024 Notes, 2026 Notes and 2027 Notes (as defined in Note 7. Borrowings) is based on vendor pricing received by the Company, which is considered a Level 2 input. The
fair value of the Company’s remaining debt is estimated using Level 3 inputs by discounting remaining payments using comparable market rates or market quotes for similar
instruments at the measurement date, if available.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The following are the carrying values and fair values of the Company’s debt as of September 30, 2023 and September 30, 2022.
Debt
$
3,133,332
$
2,990,685
$
3,093,603
$
2,902,210
As of September 30, 2023
As of September 30, 2022
Carrying Value
Fair Value
Carrying Value
Fair Value
Note 7. Borrowings
In accordance with the 1940 Act, with certain limited exceptions, prior to February 6, 2019, the Company was allowed to borrow amounts such that its asset coverage, as defined in the
1940 Act, was at least 200% after such borrowing. On February 5, 2019, the Company’s stockholders voted to approve the asset coverage requirement decrease to 150% from 200%
in accordance with Section 61(a)(2) of the 1940 Act. Effective February 6, 2019, the reduced asset coverage requirement permits the Company to have a ratio of total consolidated
assets to outstanding indebtedness of 2:1 as compared to a maximum of 1:1 under the 200% asset coverage requirement. As of September 30, 2023, the Company’s asset coverage
for borrowed amounts was 180.7%.
2018 Debt Securitization: On November 16, 2018, the Company completed a $602,400 term debt securitization (the “2018 Debt Securitization”). The notes offered in the 2018 Debt
Securitization (the “2018 Notes”) were issued by the 2018 Issuer, a subsidiary of 2018 CLO Depositor, and are backed by a diversified portfolio of senior secured and second lien loans.
The transaction was executed through a private placement of approximately $327,000 of AAA/AAA Class A 2018 Notes, which bear interest at three-month LIBOR plus 1.48%; $61,200
of AA Class B 2018 Notes, which bear interest at three-month LIBOR plus 2.10%; $20,000 of A Class C-1 2018 Notes, which bear interest at three-month LIBOR plus 2.80%; $38,800
of A Class C-2 2018 Notes, which bear interest at three-month LIBOR plus 2.65%; $42,000 of BBB- Class D 2018 Notes, which bear interest at three-month LIBOR plus 2.95%; and
$113,400 of Subordinated 2018 Notes which do not bear interest. The Company indirectly retained all of the Class C-2, Class D and Subordinated 2018 Notes.
Through January 20, 2023, the 2018 Issuer was permitted to use all principal collections received on the underlying collateral to purchase new collateral under the direction of the
Investment Adviser, in its capacity as collateral manager of the 2018 Issuer and in accordance with the Company’s investment strategy, allowing the Company to maintain the initial
leverage in the 2018 Debt Securitization. For the year ended September 30, 2023, the Company had repayments on the 2018 Notes of $19,503. For each of the years ended
September 30, 2022 and 2021, the Company had no repayments on the 2018 Notes. The 2018 Notes are scheduled to mature on January 20, 2031. The Class A, Class B and Class
C-1 2018 Notes are included in the September 30, 2023 and September 30, 2022 Consolidated Statements of Financial Condition as debt of the Company. As of September 30, 2023
and September 30, 2022, the Class C-2, Class D and Subordinated 2018 Notes were eliminated in consolidation.
As of September 30, 2023 and September 30, 2022, there were 65 and 74 portfolio companies, respectively, with a total fair value of $555,699 and $568,310, respectively, securing the
2018 Notes. The pool of loans in the 2018 Debt Securitization must meet certain requirements, including asset mix and concentration, collateral coverage, term, agency rating,
minimum coupon, minimum spread and sector diversity requirements.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The interest charged under the 2018 Debt Securitization is based on three-month SOFR plus a spread adjustment of 0.26161%. The three-month SOFR in effect as of September 30,
2023 based on the last interest rate reset was 5.3%.
For the years ended September 30, 2023, 2022 and 2021 the components of interest expense, cash paid for interest, average interest rates and average outstanding balances for the
2018 Debt Securitization were as follows:
Stated interest expense
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense
Average stated interest rate
Average outstanding balance
2023
2022
2021
Year ended September 30,
$
$
$
$
26,375
161
26,536
24,271
6.5 %
403,098
$
$
$
$
10,542
421
10,963
8,410
2.6 %
408,200
$
$
$
$
7,598
421
8,019
7,712
1.9 %
408,200
As of September 30, 2023, the classes, amounts, ratings and interest rates in effect (expressed as a spread to three-month SOFR) of the Class A, B and C-1 2018 Notes are as
follows:
Description
Type
Amount Outstanding
Fitch Rating
S&P Rating
Interest Rate
(1)
Class A 2018 Notes
Senior Secured Floating Rate
$307,497
“AAA”
“AAA”
SOFR + 1.48%
Class B 2018 Notes
Senior Secured Floating Rate
$61,200
“NR”
“AA”
SOFR + 2.10%
Class C-1 2018 Notes
Senior Secured Floating Rate
$20,000
“NR”
“A”
SOFR + 2.80%
(1)
Interest rate for securitizations represents the weighted average spread over 3-month SOFR for the various tranches of issued notes, excluding tranches retained by the Company. SOFR borrowings under the securitizations are subject to an additional spread
adjustment of 0.26161%.
GCIC 2018 Debt Securitization: Effective September 16, 2019, the Company assumed, as a result of the Merger, a $908,195 term debt securitization (the “GCIC 2018 Debt
Securitization”). The GCIC 2018 Debt Securitization was originally completed on December 13, 2018. The notes offered in the GCIC 2018 Debt Securitization (the “GCIC 2018 Notes”)
were issued by the GCIC 2018 Issuer, a subsidiary of GCIC 2018 CLO Depositor, and are secured by a diversified portfolio of senior secured and second lien loans. The GCIC 2018
Debt Securitization consists of $490,000 of AAA/AAA Class A-1 GCIC 2018 Notes, $38,500 of AAA Class A-2 GCIC 2018 Notes, and $18,000 of AA Class B-1 GCIC 2018 Notes. In
partial consideration for the loans transferred to the GCIC 2018 Issuer as part of the GCIC 2018 Debt Securitization, the GCIC 2018 CLO Depositor received and retained $27,000 of
Class B-2 GCIC 2018 Notes, $95,000 of Class C GCIC 2018 Notes and $60,000 of Class D GCIC 2018 Notes and $179,695 of Subordinated GCIC 2018 Notes. On December 21,
2020, the Company and the GCIC 2018 Issuer amended the GCIC 2018 Debt Securitization to, among other things, (a) refinance the issued Class A-2 GCIC 2018 Notes issued by the
GCIC 2018 Issuer by redeeming in full the $38,500 of Class A-2 GCIC 2018 Notes and issuing new Class A-2-R GCIC 2018 Notes in an aggregate principal amount of $38,500 that
bear interest at a rate of 2.498%, which is a decrease from the rate of 4.665% of the Class A-2 GCIC 2018 Notes and (b) provide for a non-called period, during which the Class A-2-R
GCIC 2018 Notes cannot be redeemed, from December 21, 2020 to but excluding June 21, 2021. The Class A-1, Class A-2-R and Class B-1 GCIC 2018 Notes are included in the
September 30, 2023 and September 30, 2022 Consolidated Statements of Financial Condition as debt of the Company. As of September 30, 2023 and September 30, 2022, the Class
B-2, Class C and Class D GCIC 2018 Notes and the Subordinated GCIC 2018 Notes were eliminated in consolidation.
Through January 20, 2023, the GCIC 2018 Issuer was permitted to use all principal collections received on the underlying collateral to purchase new collateral under the direction of
the Investment Adviser in its capacity as collateral manager of the GCIC 2018 Issuer and in accordance with the Company’s investment strategy, allowing the Company to maintain the
initial leverage in the GCIC 2018 Debt Securitization. For the year ended September 30, 2023, the Company had repayments on the GCIC 2018 Notes of $32,973. For the years ended
September 30, 2022 and 2021, the Company had no repayments on the GCIC 2018 Notes. The GCIC 2018 Notes are scheduled to
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
mature on January 20, 2031, and the Subordinated GCIC 2018 Notes are scheduled to mature on December 13, 2118.
Two loan sale agreements govern the GCIC 2018 Debt Securitization. One of the loan sale agreements provided for the sale of assets upon the closing of the GCIC 2018 Debt
Securitization to satisfy risk retention requirements. Under the terms of the other loan sale agreement governing the GCIC 2018 Debt Securitization, the Company agreed to directly or
indirectly through the GCIC 2018 CLO Depositor sell or contribute certain senior secured and second lien loans (or participation interests therein) to the GCIC 2018 Issuer.
As of September 30, 2023 and September 30, 2022, there were 87 and 91 portfolio companies, respectively, with a total fair value of $841,241 and $885,171, respectively, securing the
GCIC 2018 Notes. The pool of loans in the GCIC 2018 Debt Securitization must meet certain requirements, including asset mix and concentration, collateral coverage, term, agency
rating, minimum coupon, minimum spread and sector diversity requirements.
The interest charged under the GCIC 2018 Debt Securitization is based on three-month SOFR plus a spread adjustment of 0.26161%. The three-month SOFR in effect as of
September 30, 2023 based on the last interest rate reset was 5.3%.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest, average interest rates and average outstanding balances for the
GCIC 2018 Debt Securitization were as follows:
Stated interest expense
Accretion of discounts on notes issued
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
$
$
$
$
32,923
544
21
33,488
30,453
6.1 %
537,754
$
$
$
$
13,422
1,789
68
15,279
10,757
2.5 %
546,500
$
$
$
$
9,889
1,789
47
11,725
10,238
1.8 %
546,500
As of September 30, 2023, the classes, amounts, ratings and interest rates in effect (expressed as a spread to three-month SOFR, as applicable) of the Class A-1 GCIC 2018 Notes,
Class A-2 GCIC 2018 Notes, and Class B-1 GCIC 2018 Notes were as follows:
Description
Type
Amount Outstanding
Fitch’s Rating
S&P Rating
Interest Rate
(1)
Class A-1 GCIC 2018 Notes
Senior Secured Floating Rate
$457,027
"AAA"
"AAA"
SOFR + 1.48%
Class A-2-R GCIC 2018 Notes
Senior Secured Fixed Rate
$38,500
"NR"
"AAA"
2.50%
Class B-1 GCIC 2018 Notes
Senior Secured Floating Rate
$18,000
"NR"
"AA"
SOFR + 2.25%
(1)
Interest rate for securitizations represents the weighted average spread over 3-month SOFR for the various tranches of issued notes, excluding tranches retained by the Company. SOFR borrowings under the securitizations are subject to an additional spread
adjustment of 0.26161%.
2020 Debt Securitization: On August 26, 2020, the Company completed a $330,355 term debt securitization, of which $297,355 was funded at closing (the “2020 Debt
Securitization”). The notes offered in the 2020 Debt Securitization (the “2020 Notes”) were issued by the 2020 Issuer, a subsidiary of 2020 CLO Depositor, and were backed by a
diversified portfolio of senior secured and second lien loans. The 2020 Notes consisted of approximately $137,500 of AAA Class A-1 2020 Notes, which bore interest at three-month
LIBOR plus 2.35%; $10,500 of AAA Class A-2 2020 Notes, which bore interest at three-month LIBOR plus 2.75%; $21,000 of AA Class B 2020 Notes which bore interest at the three-
month LIBOR plus 3.20%; up to $33,000 A Class C 2020 Notes, which remained unfunded upon closing of the transactions and bore interest at three-month LIBOR plus a spread set in
connection with the funding date but which in no event was to be greater than 3.65%; and
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
approximately $108,355 of Subordinated 2020 Notes, which did not bear interest. The Company was permitted, subject to certain conditions, to request a one-time funding of the Class
C 2020 Notes, which would not be deemed an additional issuance of notes, but would have caused the Class C 2020 Notes to be additional debt of the Company. As a part of the 2020
Debt Securitization, the Company also entered into a credit agreement (the “Credit Agreement”) upon closing of the transactions pursuant to which various financial institutions and
other persons which were, or could have become, parties thereto as lenders (the “Lenders”) committed to make $20,000 of AAA Class A-1-L loans to the Company (the “2020 Loans”).
The 2020 Loans bore interest at three-month LIBOR plus 2.35% and were fully drawn upon closing of the transactions. Any Lender could have elected to convert all or a portion of the
Class A-1-L Loans held by such Lender into Class A-1 2020 Notes upon written notice to the Company in accordance to the Credit Agreement. The Class A-1 2020 Notes, the Class A-
2 2020 Notes and the Class B 2020 Notes were issued through a private placement. The Class C 2020 Notes and the Subordinated 2020 Notes were retained by the Company and
the Company was the sole owner of the equity of the 2020 Issuer.
Through November 5, 2022, all principal collections received on the underlying collateral could have been used by the 2020 Issuer to purchase new collateral under the direction of GC
Advisors, in its capacity as collateral manager of the 2020 Issuer and in accordance with the Company's investment strategy, allowing the Company to maintain the initial leverage in
the 2020 Debt Securitization.
On August 26, 2021, the 2020 Issuer redeemed the outstanding 2020 Notes pursuant to the terms of the indenture governing such 2020 Notes. Following such redemption, the
agreements that governed the 2020 Debt Securitization were terminated. The 2020 Notes would have otherwise matured on November 5, 2032. The pool of loans in the 2020 Debt
Securitization was required to meet certain requirements, including asset mix and concentration, collateral coverage, term, agency rating, minimum coupon, minimum spread and
sector diversity requirements.
The interest charged under the 2020 Debt Securitization was based on three-month LIBOR. For the years ended September 30, 2023, 2022 and 2021, the components of interest
expense, cash paid for interest, average interest rates
and average outstanding balances for the 2020 Debt Securitization were as follows:
Stated interest expense
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense and facility fees
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
— $
—
— $
— $
N/A
— $
— $
—
— $
— $
N/A
— $
4,596
1,580
6,176
5,101
2.7 %
170,359
$
$
$
$
The Investment Adviser served as collateral manager to the 2020 Issuer and serves as the collateral manager to the 2018 Issuer and GCIC 2018 Issuer under separate collateral
management agreements and receives a fee for providing these services. The total fees payable by the Company under the Investment Advisory Agreement are reduced by an amount
equal to the total aggregate fees paid to the Investment Adviser by the 2018 Issuer, the GCIC 2018 Issuer and the 2020 Issuer for rendering such collateral management services.
As part of each of the 2018 Debt Securitization, GCIC 2018 Debt Securitization and 2020 Debt Securitization, GBDC entered into, or assumed in the Merger, master loan sale
agreements under which GBDC agreed to directly or indirectly sell or contribute certain senior secured and second lien loans (or participation interests therein) to the 2018 Issuer,
GCIC 2018 Issuer or the 2020 Issuer, as applicable, and to purchase or otherwise acquire the LLC equity interests in the Subordinated 2018 Notes, the GCIC Subordinated 2018 Notes
and the Subordinated 2020 Notes, as applicable. As of September 30, 2023, the 2018 Notes and the GCIC 2018 Notes (other than the Subordinated 2018 Notes and the GCIC
Subordinated 2018 Notes) were the secured obligations of the 2018 Issuer and the GCIC 2018 Issuer, respectively, and indentures governing each of the 2018 Notes and the GCIC
2018 Notes include customary covenants and events of default.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
SBA Debentures: On November 4, 2020, May 4, 2021 and September 21, 2021, SBIC IV, SBIC V, and SBIC VI, respectively, surrendered their licenses to operate as a SBIC. The
SBICs were subject to a variety of regulations and
oversight by the SBA concerning the size and nature of the companies in which they invested as well as the
structures of those investments. The licenses allowed the SBICs to obtain leverage by issuing SBA-guaranteed
debentures, subject to issuance of a capital commitment by the SBA and customary procedures. These debentures
were non-recourse to the Company, had interest payable semiannually and a ten-year maturity. The interest rate was
fixed at the time of issuance at a market-driven spread over U.S. Treasury Notes with ten-year maturities.
As of September 30, 2023 and September 30, 2022, each of SBIC IV, SBIC V and SBIC VI had no outstanding SBA-guaranteed debentures. The original amount of debentures
committed to SBIC IV, SBIC V and SBIC VI by the SBA were $150,000, $175,000 and $175,000, respectively. Through September 30, 2021, SBIC IV, SBIC V and SBIC VI repaid all
outstanding debentures and the corresponding debenture commitments were terminated.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest, average interest rates and average outstanding balances for the
SBA debentures were as follows:
Stated interest expense
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense and facility fees
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
— $
—
— $
— $
N/A
— $
— $
—
— $
— $
N/A
— $
3,851
4,621
8,472
4,396
2.7 %
143,179
$
$
$
$
MS Credit Facility II: On February 1, 2019, Funding II entered into a credit facility (as amended, the “MS Credit Facility II”) with Morgan Stanley, as the administrative agent, each of
the lenders from time to time party thereto, each of the securitization subsidiaries from time to time party thereto, and Wells Fargo Bank, N.A., as collateral agent, account bank and
collateral custodian. On September 16, 2022, all amounts outstanding under the MS Credit Facility II were repaid, following which the agreements governing the MS Credit Facility II
were terminated. Prior to its termination, the MS Credit Facility II had a borrowing capacity of $75,000 and bore interest at the applicable base rate plus 2.05%. The base rate under the
MS Credit Facility II was (i) one-month LIBOR with respect to any advances denominated in U.S. dollars or U.K. pound sterling, (ii) one-month EURIBOR with respect to any advances
denominated in euros, and (iii) one-month Canadian Dollar Offered Rate with respect to any advances denominated in Canadian dollars. The scheduled maturity date of the MS Credit
Facility II was April 12, 2026. The MS Credit Facility II was subject to a non-usage fee of 0.50% per annum.
The MS Credit Facility II was secured by all of the assets held by Funding II. Both the Company and Funding II made customary representations and warranties and were required to
comply with various covenants, reporting requirements and other customary requirements for similar credit facilities. The borrowings under the MS Credit Facility II were subject to the
leverage restrictions contained in the 1940 Act.
As of both September 30, 2023 and September 30, 2022, the Company did not have any outstanding debt under the MS Credit Facility II.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest and facility fees, average interest rates and average outstanding
balances for the MS Credit Facility II were as follows:
Stated interest expense
Facility fees
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense and facility fees
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
— $
—
—
— $
— $
N/A
— $
702
529
535
1,766
1,421
4.0 %
17,452
$
$
$
$
3,000
262
493
3,755
5,034
2.7 %
112,375
$
$
$
$
WF Credit Facility : Effective September 16, 2019, the Company assumed, as a result of the Merger, a senior secured revolving credit facility (as amended, the “WF Credit Facility”)
with GCIC Funding as the borrower and with Wells Fargo Bank, N.A. as the swingline lender, collateral agent, account bank, collateral custodian and administrative agent. On
February 12, 2021, all outstanding borrowings under the WF Credit Facility were repaid following which the WF Credit Facility was terminated. Prior to its termination, the WF Credit
Facility allowed GCIC Funding to borrow up to $300,000 at any one time outstanding, subject to leverage and borrowing base restrictions. The stated maturity on the WF Credit Facility
was March 21, 2024, with a reinvestment period that would have expired on March 20, 2021. The WF Credit Facility bore interest at one-month LIBOR plus 2.00%. A non-usage fee
rate between 0.50% and 1.75% per annum was payable depending on the size of the unused portion of the WF Credit Facility.
The WF Credit Facility was collateralized by all of the assets held by GCIC Funding, and GBDC pledged its interests in GCIC Funding as collateral to Wells Fargo Bank, N.A., as the
collateral agent, to secure the obligations of GBDC as the transferor and servicer under the WF Credit Facility. Both GBDC and GCIC Funding made customary representations and
warranties and were required to comply with various covenants, reporting requirements and other customary requirements for similar credit facilities. Borrowings under the WF Credit
Facility were subject to the asset coverage requirements contained in the 1940 Act.
The Company transferred certain loans and debt securities it originated or acquired from time to time to GCIC Funding through a purchase and sale agreement and caused GCIC
Funding to originate or acquire loans, consistent with the Company’s investment objectives.
As of September 30, 2023 and September 30, 2022, the Company had no outstanding debt or commitments under the WF Credit Facility.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest
and facility fees, average interest rates and average outstanding balances for the WF Credit Facility were as follows:
Stated interest expense
Facility fees
Total interest and other debt financing expenses
Cash paid for interest expense and facility fees
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
— $
—
— $
— $
N/A
— $
— $
—
— $
— $
N/A
— $
996
323
1,319
1,614
2.2 %
45,050
$
$
$
$
250
TABLE OF CONTENTS
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
DB Credit Facility : Effective September 16, 2019, the Company assumed as a result of the Merger a senior secured revolving credit facility (as amended, the “DB Credit Facility”) with
GCIC Funding II as the borrower and with Deutsche Bank AG, New York branch, as facility agent, the other agents parties thereto, each of the entities from time to time party thereto
as securitization subsidiaries and Wells Fargo Bank, National Association, as collateral agent and as collateral custodian. On October 9, 2020, all outstanding borrowings under the DB
Credit Facility were repaid following which the DB Credit Facility was terminated. Prior to its termination, the DB Credit Facility allowed GCIC Funding II to borrow up to $250,000 at
any one time outstanding, subject to leverage and borrowing base restrictions.
The DB Credit Facility bore interest at the applicable base rate plus 1.90% per annum. The base rate under the DB Credit Facility was (i) the three-month Canadian Dollar Offered Rate
with respect to any advances denominated in Canadian dollars, (ii) the three-month EURIBOR Interbank Offered Rate with respect to any advances denominated in Euros, (iii) the
three-month Bank Bill Swap Rate with respect to any advances denominated in Australian dollars and (iv) the three-month LIBOR with respect to any other advances. A non-usage fee
of 0.25% per annum was payable on the undrawn amount under the DB Credit Facility, and an additional fee based on unfunded commitments of the lenders was payable if borrowings
under the DB Credit Facility did not exceed a minimum utilization percentage threshold. In addition, a syndication/agent fee was payable to the facility agent each quarter and was
calculated based on the aggregate commitments outstanding each day during the preceding collection period at a rate of 1/360 of 0.25% of the aggregate commitments on each day.
The reinvestment period of the DB Credit Facility would have expired on December 31, 2021 and the DB Credit Facility would have matured on December 31, 2024.
The DB Credit Facility was secured by all of the assets held by GCIC Funding II. GCIC Funding II made customary representations and warranties and was required to comply with
various covenants, reporting requirements and other customary requirements for similar credit facilities. The borrowings of the Company, including under the DB Credit Facility, were
subject to the leverage restrictions contained in the 1940 Act.
The Company transferred certain loans and debt securities it originated or acquired from time to time to GCIC Funding II through a purchase and sale agreement and caused GCIC
Funding II to originate or acquire loans, consistent with the Company’s investment objectives.
As of September 30, 2023 and September 30, 2022, the Company had no outstanding debt or commitments under the DB Credit Facility.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest and facility fees, average interest rates and average outstanding
balances for the DB Credit Facility were as follows:
Stated interest expense
Facility fees
Total interest and other debt financing expenses
Cash paid for interest expense and facility fees
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
— $
—
— $
— $
N/A
— $
— $
—
— $
— $
N/A
— $
73
14
87
840
2.2 %
3,256
$
$
$
$
JPM Credit Facility : On February 11, 2021, the Company entered into a senior secured revolving credit facility (as amended, the “JPM Credit Facility”) with the Company, as
borrower, JPMorgan Chase Bank N.A., as administrative agent and as collateral agent, and the lenders from time to time party thereto which, as of September 30, 2023, allowed the
Company to borrow up to $1,487,500 in U.S. dollars and certain agreed upon foreign currencies, subject to leverage and borrowing base restrictions. Through a series of amendments,
most recently on March 17, 2023, the Company amended the JPM Credit Facility, to, among other things, extend the maturity date to March 17, 2028, decrease the adjustment to term
SOFR for loans using such rate to 0.10% and increase the
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
accordion feature to allow the Company to request, at one or more times, that existing and/or new lenders, at their election provide up to $512,500 of additional commitments.
The JPM Credit Facility provides for the issuance of letters of credit in an initial aggregate face amount of up to $23,750, subject to increase or reduction from time to time pursuant to
the terms of the JPM Credit Facility.
The JPM Credit Facility is secured by a first priority security interest in substantially all of the assets of the Company and certain of the Company’s subsidiaries thereunder.
Borrowings under the JPM Credit Facility bear interest at the applicable base rate plus a margin of either 1.75% or 1.875%, subject to compliance with a borrowing base test. The
applicable base rate under the JPM Credit Facility is (i) one-month SOFR with respect to any advances denominated in U.S. dollars, (ii) SONIA with respect to any advances
denominated in U.K. pound sterling, (iii) one-month EURIBOR with respect to any advances denominated in euros, and (iv) the relevant rate as defined in the JPM Credit Facility for
borrowings in other currencies. Effective September 13, 2022, interest under the JPM Facility for loans denominated in SOFR were converted to reference a benchmark rate of term
SOFR plus an adjustment of an amount ranging between 0.11448% and 0.42826% (subject to applicable tenor). Effective March 17, 2023, the adjustment to term SOFR was reduced
to 0.10%.
The Company pays a commitment fee of 0.375% per annum on the daily unused portion of commitments under the JPM Credit Facility. The Company is also required to pay letter of
credit participation fees and a fronting fee on the daily amount of any lender’s exposure with respect to any letters of credit issued at the request of the Company under the JPM Credit
Facility. The JPM Credit Facility matures on March 17, 2028, with the exception of a $37,500 commitment from one non-extending lender that matures on February 11, 2026, and
requires mandatory prepayment of interest and principal upon certain events during the one year amortization period of the facility.
As of September 30, 2023 and September 30, 2022, the Company had outstanding debt of $784,374 and $692,592, respectively, and no letters of credit outstanding under the JPM
Credit Facility.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest and facility fees, average interest rates and average outstanding
balances for the JPM Credit Facility were as follows:
Stated interest expense
Facility fees
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense and facility fees
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
$
$
$
$
41,821
2,635
2,793
47,249
44,667
6.2 %
678,560
$
$
$
$
13,876
2,501
1,865
18,242
14,948
2.6 %
524,105
$
$
$
$
1,200
958
710
2,868
1,593
2.0 %
59,612
2024 Notes: On October 2, 2020, the Company issued $400,000 in aggregate principal amount of unsecured notes (the “2024 Notes”), and on October 15, 2021, the Company issued
an additional $100,000 in aggregate principal amount of 2024 Notes under the same terms of the original issuance. As of both September 30, 2023 and September 30, 2022, the
outstanding aggregate principal amount of the 2024 Notes was $500,000. The 2024 Notes bear interest at a rate of 3.375% per year payable semiannually in arrears on April 15 and
October 15 of each year, commencing on April 15, 2021. The 2024 Notes mature on April 15, 2024.
The 2024 Notes are the Company’s general unsecured obligations that rank senior in right of payment to all of the Company’s future indebtedness or other obligations that are
expressly subordinated, or junior, in right of payment to the 2024 Notes; equal in right of payment to the Company’s existing and future indebtedness or other obligations that are not so
subordinated or junior; effectively junior to any of the Company’s secured indebtedness or other obligations (including unsecured indebtedness that the Company later secures) to the
extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness and other obligations (including trade payables) incurred by
the Company’s subsidiaries, financing vehicles or similar facilities.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
At any time or from time to time, the Company may redeem some or all of the 2024 Notes at a redemption price equal to the greater of (1) 100% of the principal amount of the 2024
Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of
redemption) on the 2024 Notes to be redeemed through March 15, 2024 (the date falling one month prior to the maturity date of the 2024 Notes), discounted to the redemption date on
a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 50 basis points, plus, in each case, accrued and unpaid
interest, if any, to, but excluding, the redemption date; provided, however, that if the Company redeems any 2024 Notes on or after March 15, 2024 (the date falling one month prior to
the maturity date of the 2024 Notes), the redemption price for the 2024 Notes will be equal to 100% of the principal amount of the 2024 Notes to be redeemed, plus accrued and unpaid
interest, if any, to, but excluding, the redemption date. No sinking fund is provided for the 2024 Notes.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest and facility fees, average interest rates and average outstanding
balances for the 2024 Notes were as follows:
Stated interest expense
Accretion of discounts and amortization of premiums on notes issued
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
16,876
(1,384)
1,986
17,478
16,876
3.4 %
500,000
$
$
$
$
16,745
(1,327)
1,932
17,350
15,188
3.4 %
496,164
$
$
$
$
13,463
90
1,583
15,136
7,238
3.4 %
398,904
$
$
$
$
2026 Notes: On February 24, 2021, the Company issued $400,000 in aggregate principal amount of unsecured notes (the “2026 Notes”) and on October 13, 2021, the Company
issued an additional $200,000 aggregate principal amount of 2026 Notes under the same terms as the original issuance. As of both September 30, 2023 and September 30, 2022,
outstanding aggregate principal amount of the 2026 Notes was $600,000. The 2026 Notes bear interest at a rate of 2.500% per year payable semiannually in arrears on February 24
and August 24 of each year, commencing on August 24, 2021. The 2026 Notes mature on August 24, 2026.
The 2026 Notes are the Company’s general unsecured obligations that rank senior in right of payment to all of the Company’s future indebtedness or other obligations that are
expressly subordinated, or junior, in right of payment to the 2026 Notes; equal in right of payment to the Company’s existing and future indebtedness or other obligations that are not so
subordinated or junior; effectively junior to any of the Company’s secured indebtedness or other obligations (including unsecured indebtedness that the Company later secures) to the
extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness and other obligations (including trade payables) incurred by
the Company’s subsidiaries, financing vehicles or similar facilities.
At any time or from time to time, the Company may redeem some or all of the 2026 Notes at a redemption price equal to the greater of (1) 100% of the principal amount of the 2026
Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of
redemption) on the 2026 Notes to be redeemed through July 24, 2026 (the date falling one month prior to the maturity date of the 2026 Notes), discounted to the redemption date on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 30 basis points, plus, in each case, accrued and unpaid
interest, if any, to, but excluding, the redemption date; provided, however, that if the Company redeems any 2026 Notes on or after July 24, 2026 (the date falling one month prior to the
maturity date of the 2026 Notes), the redemption price for the 2026 Notes will be equal to 100% of the principal amount of the 2026 Notes to be redeemed, plus accrued and unpaid
interest, if any, to, but excluding, the redemption date. No sinking fund is provided for the 2026 Notes.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest and facility fees, average interest rates and average outstanding
balances for the 2026 Notes were as follows:
Stated interest expense
Accretion of discounts on notes issued
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
15,000
531
1,493
17,024
15,000
2.5 %
600,000
$
$
$
$
14,833
520
1,588
16,941
14,319
2.5 %
593,425
$
$
$
$
6,028
132
595
6,755
5,000
2.5 %
240,000
$
$
$
$
2027 Notes: On August 3, 2021, the Company issued $350,000 in aggregate principal amount of unsecured notes (the “2027 Notes”). As of both September 30, 2023 and September
30, 2022, outstanding aggregate principal amount of the 2027 Notes was $350,000. The 2027 Notes bear interest at a rate of 2.050% per year payable semi-annually in arrears on
February 15 and August 15 of each year, commencing on February 15, 2022. The 2027 Notes mature on February 15, 2027.
The 2027 Notes are the Company’s general unsecured obligations that rank senior in right of payment to all of the Company’s future indebtedness or other obligations that are
expressly subordinated, or junior, in right of payment to the 2027 Notes; equal in right of payment to the Company’s existing and future indebtedness or other obligations that are not so
subordinated or junior; effectively junior to any of the Company’s secured indebtedness or other obligations (including unsecured indebtedness that the Company later secures) to the
extent of the value of the assets securing such indebtedness; and structurally junior to all existing and future indebtedness and other obligations (including trade payables) incurred by
the Company’s subsidiaries, financing vehicles or similar facilities.
At any time or from time to time, the Company may redeem some or all of the 2027 Notes at a redemption price equal to the greater of (1) 100% of the principal amount of the 2027
Notes to be redeemed or (2) the sum of the present values of the remaining scheduled payments of principal and interest (exclusive of accrued and unpaid interest to the date of
redemption) on the 2027 Notes to be redeemed through January 15, 2027 (the date falling one month prior to the maturity date of the 2027 Notes), discounted to the redemption date
on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) using the applicable Treasury Rate plus 25 basis points, plus, in each case, accrued and unpaid
interest, if any, to, but excluding, the redemption date; provided, however, that if the Company redeems any 2027 Notes on or after January 15, 2027 (the date falling one month prior
to the maturity date of the 2027 Notes), the redemption price for the 2027 Notes will be equal to 100% of the principal amount of the 2027 Notes to be redeemed, plus accrued and
unpaid interest, if any, to, but excluding, the redemption date. No sinking fund is provided for the 2027 Notes.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest and facility fees, average interest rates and average outstanding
balances for the 2027 Notes were as follows:
Stated interest expense
Accretion of discounts on notes issued
Amortization of debt issuance costs
Total interest and other debt financing expenses
Cash paid for interest expense
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
$
$
$
$
7,176
733
926
8,835
7,174
2.1 %
350,000
$
$
$
$
7,176
733
928
8,837
7,415
2.1 %
350,000
$
$
$
$
1,156
118
153
1,427
—
2.0 %
56,575
Adviser Revolver: The Company has entered into the Adviser Revolver with the Investment Adviser pursuant to which, as of each of September 30, 2023 and September 30, 2022,
the Company was permitted to borrow up to
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
$100,000 and which had a maturity date of June 21, 2022. The Adviser Revolver bears an interest rate equal to the short-term Applicable Federal Rate (“AFR”). The short-term AFR as
of September 30, 2023 was 5.0%. On June 15, 2022, the Company amended the revolving loan agreement to extend the maturity date to June 15, 2025. As of both September 30,
2023 and September 30, 2022, the Company had no outstanding debt under the Adviser Revolver.
For the years ended September 30, 2023, 2022 and 2021, the components of interest expense, cash paid for interest, average interest rates and average outstanding balances for the
Adviser Revolver were as follows:
Stated interest expense
Cash paid for interest expense
Average stated interest rate
Average outstanding balance
2023
Year ended September 30,
2022
2021
$
$
—
—
N/A
—
$
$
— $
—
N/A
— $
—
—
N/A
—
For the years ended September 30, 2023, 2022 and 2021, the average total debt outstanding was $3,069,412, $2,935,846 and $2,184,010, respectively.
For the years ended September 30, 2023, 2022 and 2021, the effective average interest rate, which includes amortization of debt financing costs, accretion of discounts and
amortization of premiums on notes issued and non-usage facility fees, on the Company's total debt was 4.9%, 3.0% and 3.0%, respectively.
A summary of the Company’s maturity requirements for borrowings as of September 30, 2023 is as follows:
2018 Debt Securitization
2018 GCIC Debt Securitization
JPM Credit Facility
2024 Notes
2026 Notes
2027 Notes
(2)
(2)
(2)
Total borrowings
Total
Less Than
1 Year
1 – 3 Years
3 – 5 Years
More Than
5 Years
Payments Due by Period
$
$
388,697
513,528
784,373
500,747
598,461
347,526
3,133,332
$
$
— $
—
—
500,747
—
—
500,747
$
—
—
20,838
—
598,461
—
619,299
(1)
$
$
— $
—
763,535
—
—
347,526
1,111,061
$
388,697
513,528
—
—
—
—
902,225
(1)
(2)
Represents principal outstanding on $37,500 commitment from one non-extending lender that matures on February 11, 2026.
Represents principal outstanding plus unamortized premium and / or unaccreted original issue discount.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Note 8. Federal Income Tax Matters
The Company has elected to be treated and intends to be subject to tax as a RIC under Subchapter M of the Code. As a result, the Company must distribute substantially all of its net
taxable income each tax year as dividends to its stockholders.
Dividends from net investment income and distributions from net realized capital gains are determined in accordance with U.S. federal tax regulations, which may differ from amounts
determined in accordance with GAAP and those differences could be material. These book-to-tax differences are either temporary or permanent in nature. Reclassifications due to
permanent book-tax differences have no impact on net assets.
The following permanent differences were reclassified for tax purposes among the components of net assets for the years ended September 30, 2023, 2022 and 2021:
Increase (decrease) in Paid in Capital in Excess of Par
Increase (decrease) in Distributable Earnings (Losses)
2023
$
Years ended September 30,
2022
2021
(12,902)
12,902
$
(750) $
750
(1,425)
1,425
Taxable income generally differs from net increase (decrease) in net assets resulting from operations for financial reporting purposes due to temporary and permanent differences in
the recognition of income and expenses and generally excludes unrealized appreciation (depreciation) on investment transactions as investment gains and losses are not included in
taxable income until they are realized.
The following table reconciles net increase (decrease) in net assets resulting from operations to taxable income for the years ended September 30, 2023, 2022 and 2021:
Net increase (decrease) in net assets resulting from operations
Net change in unrealized (appreciation) depreciation on investment transactions
Other income not currently taxable
Expenses not currently deductible
Other income for tax but not book
Other deductions/losses for tax not book
Other realized gain/loss differences
Taxable income before deductions for distributions
2023
Years ended September 30,
2022
2021
$
$
258,631
(13,555)
(22,437)
11,198
3,773
(39,639)
29,175
227,146
$
$
153,440
61,898
(7,574)
18,652
5,846
(519)
41,313
273,056
$
$
340,280
(165,246)
(13,466)
33,125
8,215
(5,295)
(2,762)
194,851
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The tax character of distributions paid during the years ended September 30, 2023, 2022 and 2021 was as follows:
Ordinary Income
Long-Term Capital Gains
2023
$
Years ended September 30,
2022
209,607
28,785
$
204,806
—
$
2021
189,204
5,648
The tax basis components of distributable earnings/(accumulated losses) and reconciliation to accumulated earnings/(deficit) on a book basis for the years ended September 30, 2023,
2022 and 2021 were as follows:
Undistributed ordinary income – tax basis
Undistributed realized gains – tax basis
Net unrealized appreciation (depreciation) on investments
Other temporary differences
Total accumulated earnings (deficit) – book basis
2023
As of September 30,
2022
2021
$
$
56,886
—
(160,673)
4,583
(99,204)
$
$
39,466
28,784
(204,442)
3,847
(132,345)
$
$
—
—
(82,787)
1,058
(81,729)
Capital losses in excess of capital gains earned in a tax year may generally be carried forward and used to offset capital gains, subject to certain limitations. Capital losses incurred by
the Company in tax years beginning after September 30, 2011 are not subject to expiration and retain their character as either short-term or long-term capital losses. As of September
30, 2023, the Company estimates that it will have $757 of capital loss carryforward available for use in subsequent tax years.
For tax purposes, the Company may elect to defer any portion of a post-October capital loss or late-year ordinary loss to the first day of the following fiscal year. As of September 30,
2023, September 30, 2022 and September 30, 2021, the Company did not elect to defer ordinary losses, short-term capital losses or long-term capital losses.
For the tax year ended September 30, 2023, the Company estimates taxable income in excess of the distributions made from such taxable income during the tax year, and therefore,
the Company has elected to carry forward the excess for distribution to stockholders in the tax year ended September 30, 2024. The amount carried forward to the tax year ended
September 30, 2024 is estimated to be approximately $56,886 of ordinary income, although these amounts will not be finalized until the September 30, 2023 tax returns are filed in
2024.
As of September 30, 2023, the federal tax cost of investments was $5,695,036 resulting in estimated gross unrealized gains and losses of $104,381 and $282,804, respectively.
The Company has consolidated subsidiaries that are subject to U.S. federal and state corporate-level income taxes. For the year ended September 30, 2023, the Company recorded a
tax benefit for taxable subsidiaries of $101. For the years ended September 30, 2022 and 2021, the Company recorded a tax expense for taxable subsidiaries of $1,229 and $543,
respectively. As of September 30, 2023, the Company recorded a net deferred tax liability of $1,090 for taxable subsidiaries, which is included in accounts payable and other liabilities
on the Consolidated Statements of Financial Condition. The deferred tax liability primarily resulted from unrealized appreciation on the investments held at the taxable subsidiaries. As
of September 30, 2022, the Company recorded a net deferred tax liability of $1,398 for taxable subsidiaries, which is included in accounts payable and other liabilities on the
Consolidated Statements of Financial Condition. The deferred tax liability primarily resulted from unrealized appreciation on the investments held at the taxable subsidiaries.
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Note 9. Commitments and Contingencies
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Commitments: As of September 30, 2023, the Company had outstanding commitments to fund investments totaling $189,378, including $39,650 of commitments on undrawn
revolvers. As of September 30, 2022, the Company had outstanding commitments to fund investments totaling $224,581, including $35,643 of commitments on undrawn revolvers.
Indemnifications: In the normal course of business, the Company enters into contracts and agreements that contain a variety of representations and warranties that provide general
indemnifications. The Company’s maximum exposure under these arrangements is unknown, as these involve future claims against the Company that have not occurred. The
Company expects the risk of any future obligations under these indemnifications to be remote.
Off-balance sheet risk: Off-balance sheet risk refers to an unrecorded potential liability that may result in a future obligation or loss, even though it does not appear on the
Consolidated Statements of Financial Condition. The Company has entered and, in the future, could again enter into derivative instruments that contain elements of off-balance sheet
market and credit risk. Refer to Note 5 for outstanding forward currency contracts as of September 30, 2023 and September 30, 2022. Derivative instruments can be affected by market
conditions, such as interest rate and foreign currency volatility, which could impact the fair value of the derivative instruments. If market conditions move against the Company, it may
not achieve the anticipated benefits of the derivative instruments and may realize a loss. The Company minimizes market risk through monitoring its investments and borrowings.
Concentration of credit and counterparty risk: Credit risk arises primarily from the potential inability of counterparties to perform in accordance with the terms of the contract. The
Company has engaged and, in the future, may engage again in derivative transactions with counterparties. In the event that the counterparties do not fulfill their obligations, the
Company may be exposed to risk. The risk of default depends on the creditworthiness of the counterparties or issuers of the instruments. The Company’s maximum loss that it could
incur related to counterparty risk on its derivative instruments is the value of the collateral for that respective derivative instrument. It is the Company’s policy to review, as necessary,
the credit standing of each counterparty.
Legal proceedings: In the normal course of business, the Company is subject to legal and regulatory proceedings that are generally incidental to its ongoing operations. While there
can be no assurance of the ultimate disposition of any such proceedings, the Company does not believe any disposition will have a material adverse effect on the Company’s
consolidated financial statements.
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Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Note 10. Financial Highlights
The financial highlights for the Company are as follows:
Per share data:
(1)
Net asset value at beginning of period
Net increase in net assets as a result of issuance of DRIP shares
Net increase (decrease) in net assets as a result of issuance of shares
Net increase in net assets as a result of repurchases of shares
Distributions declared:
From net investment income - after tax
From capital gains
From return of capital
Net investment income - after tax
Net realized gain (loss) on investment transactions
Net change in unrealized appreciation (depreciation) on investment transactions
(3)
Net asset value at end of period
Per share market value at end of period
Total return based on market value
Number of common shares outstanding
(4)
2023
2022
Year ended September 30,
2021
2020
2019
$
$
$
14.89
—
—
0.01
(1.23)
(0.17)
—
1.70
(0.26)
0.08
15.02
14.67
$
$
$
15.19
0.00
—
—
(1.20)
—
—
1.15
0.12
(0.37)
14.89
12.39
$
(2)
$
$
14.33
0.00
—
—
(1.13)
(0.03)
—
0.99
0.05
0.98
15.19
15.81
$
(2)
$
$
16.76
0.01
(1.13)
—
(1.29)
(0.04)
(0.04)
0.94
(0.12)
(0.76)
14.33
13.24
$
$
$
16.10
0.01
3.17
—
(1.27)
(0.13)
—
1.36
(0.07)
(2.41)
16.76
18.84
30.50 %
(14.80)%
169,594,742
170,895,670
28.90 %
170,028,584
(22.81)%
8.80 %
167,259,511
132,658,200
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Listed below are supplemental data and ratios to the financial
highlights:
Ratio of net investment income - after tax to average net assets
Ratio of total expenses (without waiver) to average net assets
Ratio of management fee waiver to average net assets
Ratio of incentive fees to average net assets
Ratio of excise tax to average net assets
Ratio of net expenses (without incentive fees) to average net assets
Total return based on average net asset value
Net assets at end of period
Average debt outstanding
Average debt outstanding per share
Portfolio turnover
Asset coverage ratio
Asset coverage ratio per unit
Average market value per unit:
(6)
(8)
(7)
(5)
2018 Debt Securitization
GCIC 2018 Debt Securitization
2020 Debt Securitization
SBA Debentures
MS Credit Facility II
WF Credit Facility
DB Credit Facility
JPM Credit Facility
2024 Notes
2026 Notes
2027 Notes
Adviser Revolver
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
Year ended September 30,
2023
11.46%
12.45%
—%
2.94%
0.15%
9.51%
10.25%
$2,547,878
$3,069,412
$18.10
12.19%
180.68%
$1,807
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$969
$867
$834
N/A
2022
7.53%
7.43%
(0.07)%
0.68%
—%
6.68%
5.89%
$2,544,500
$2,935,846
$17.18
23.56%
181.70%
$1,817
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$996
$917
$888
N/A
2021
6.73%
5.78%
(0.16)%
0.13%
—%
5.49%
13.70%
$2,582,692
$2,184,010
$12.84
35.58%
200.04%
$2,000
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
$1,034
$1,004
$990
N/A
2020
6.22%
7.15%
—%
0.62%
—%
6.53%
2.45%
$2,396,193
$2,200,950
$13.16
14.87%
232.15%
$2,321
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
2019
8.41%
8.42%
—%
0.87%
—%
7.55%
(1.81)%
$2,222,854
$1,050,155
$7.92
17.47%
220.31%
$2,203
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
Based on actual number of shares outstanding at the end of the corresponding period or the weighted average shares outstanding for the period, unless otherwise noted, as appropriate.
Represents an amount less than $0.01
Includes the impact of different share amounts as a result of calculating certain per share data based on weighted average shares outstanding during the period and certain per share data based on the shares
outstanding as of the dividend record date.
Total return based on market value assumes distributions are reinvested in accordance with the DRIP. Total return does not include sales load.
Total return based on average net asset value is calculated as (a) the net increase (decrease) in net assets resulting from operations divided by (b) the daily average of total net assets. Total return does not
include sales load.
Effective February 6, 2019, in accordance with Section 61(a)(2) of the 1940 Act, with certain limited exceptions, the Company is allowed to borrow amounts such that its asset coverage, as defined in the 1940 Act,
is at least 150% after such borrowing (excluding the Company's SBA debentures pursuant to exemptive relief received by the Company from the SEC). Prior to February 6, 2019, in accordance with the 1940 Act,
with certain limited exceptions, the Company was allowed to borrow amounts such that its asset coverage, as defined in the 1940 Act, was at least 200% after such borrowing (excluding the Company's SBA
debentures pursuant to exemptive relief received by the Company from the SEC).
Asset coverage ratio 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 ratio per unit is expressed in terms of dollar amounts per $1,000 of indebtedness. These amounts exclude the SBA debentures pursuant to exemptive relief the
Company received from the SEC on September 13, 2011.
Not applicable since such senior securities are not registered for public trading, with the exception of the 2024 Notes, 2026 Notes and the 2027 Notes. The average market value per unit calculated for the 2024
Notes, 2026 Notes, and the 2027 Notes is based on the average monthly prices of such notes and is expressed in terms of dollar amounts per $1,000 of indebtedness.
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Note 11. Earnings Per Share
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The following information sets forth the computation of the net increase in net assets per share resulting from operations for the years ended September 30, 2023, 2022 and 2021:
Earnings available to stockholders
Basic and diluted weighted average shares outstanding
Basic and diluted earnings per share
Note 12. Common Stock Transactions
$
$
2023
258,631 $
170,324,784
1.52 $
Year ended September 30,
2022
153,440 $
170,674,570
0.90 $
2021
340,280
167,994,042
2.03
On August 3, 2023, the Board reapproved the Program to repurchase up to $150,000 of the Company’s common stock pursuant to the Program, exclusive of shares repurchased prior
to the date of such authorization. Under the Program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all
applicable securities laws and regulations. As of September 30, 2023, the repurchased shares have been retired and returned to the status of authorized but unissued shares of GBDC
Common Stock.
As of September 30, 2023, Wells Fargo Securities, LLC, as broker, repurchased 1,300,928 shares of the Company’s common stock pursuant to the Program for an aggregate purchase
price of approximately $16,861. For the year ended September 30, 2023, repurchases under the Program were as follows:
Day Purchased
March 1 - 31, 2023
April 1 - 30, 2023
May 1 - 31, 2023
June 1 - 30, 2023
July 1 - 31, 2023
Total
Total Number of Shares
Repurchased
751,544
56,130
188,210
299,794
5,250
1,300,928
Average Price Paid Per
Share
$12.84
13.03
12.95
13.26
13.29
$12.96
Approximate Dollar Value of Shares that have
been Purchased Under the Plan
$9,647
731
2,438
3,975
70
$16,861
Approximate Dollar Value of Shares that May
Yet be Purchased Under the Plan
$140,353
139,622
137,184
133,209
133,139
$150,000
(1)
(1)
The program was reapproved on August 3, 2023 to purchase $150,000 of the Company’s common stock, exclusive of shares repurchased prior to the date of such authorization. No additional shares have been
purchased since the re-approval.
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Note 13. Dividends and Distributions
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
The Company’s dividends and distributions are recorded on the ex-dividend date. The following table summarizes the Company’s dividend declarations and distributions during the
years ended September 30, 2023, 2022 and 2021:
Date Declared
For the year ended September 30, 2023
Record Date
Payment Date
Amount
Per Share
Cash
Distribution
DRIP Shares
Issued
DRIP Shares
Value
11/18/2022
02/07/2023
05/05/2023
08/03/2023
08/03/2023
For the year ended September 30, 2022
11/19/2021
02/04/2022
05/06/2022
08/05/2022
For the year ended September 30, 2021
11/20/2020
02/05/2021
05/07/2021
08/06/2021
12/09/2022
03/03/2023
06/02/2023
08/18/2023
09/01/2023
12/10/2021
03/04/2022
06/03/2022
09/02/2022
12/11/2020
03/05/2021
06/11/2021
09/08/2021
12/29/2022 $
03/29/2023 $
06/29/2023 $
09/15/2023 $
09/29/2023 $
12/30/2021 $
03/29/2022 $
06/29/2022 $
09/29/2022 $
12/30/2020 $
03/30/2021 $
06/29/2021 $
09/29/2021 $
0.33
0.33
0.33
0.04
0.37
0.30
0.30
0.30
0.30
0.29
0.29
0.29
0.29
$
$
$
$
$
$
$
$
$
$
$
$
$
47,245
43,548
44,518
5,495
50,659
38,291
37,358
39,336
40,223
33,846
34,311
35,113
35,852
—
—
—
—
—
837,158
29,928
—
—
—
972,196
920,150
876,727
$
$
$
$
$
$
$
$
$
$
$
$
$
9,151
12,848
11,548
1,289
12,091
(1)
(2)
(3)
(4)
(5)
(6)(7)
(8)
(9)
(10)
12,717
13,902
11,933
11,046
14,659
14,194
13,674
13,203
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
In accordance with the Company's DRIP, 689,422 shares of the Company's stock were purchased in the open market at an average price of $13.27 and were allocated to stockholders of the Company
participating in DRIP.
In accordance with the Company's DRIP, 959,844 shares of the Company's stock were purchased in the open market at an average price of $13.39 and were allocated to stockholders of the Company
participating in DRIP.
In accordance with the Company's DRIP, 854,808 shares of the Company's stock were purchased in the open market at an average price of $13.51 and were allocated to stockholders of the Company
participating in DRIP.
In accordance with the Company's DRIP, 90,264 shares of the Company's stock were purchased in the open market at an average price of $14.28 and were allocated to stockholders of the Company participating
in DRIP.
In accordance with the Company's DRIP, 824,353 shares of the Company's stock were purchased in the open market at an average price of $14.67 and were allocated to stockholders of the Company
participating in DRIP.
In accordance with the Company's DRIP, 882,358 shares of the Company's stock were purchased in the open market at an average price of
$15.24 and were allocated to stockholders of the Company participating in DRIP.
In accordance with the Company’s DRIP, the Company issued 29,928 shares for proceeds totaling $457.
In accordance with the Company's DRIP, 917,845 shares of the Company's stock were purchased in the open market at an average price of $13.00 and were allocated to stockholders of the Company
participating in DRIP.
In accordance with the Company's DRIP, 903,318 shares of the Company's stock were purchased in the open market at an average price of $12.23 and were allocated to stockholders of the Company
participating in DRIP.
(10)
In accordance with the Company's DRIP, 1,034,149 shares of the Company's stock were purchased in the open market at an average price of $14.18 and were allocated to stockholders of the Company
participating in DRIP.
262
TABLE OF CONTENTS
Note 14. Subsequent Events
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
In preparing these consolidated financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through the date of issuance. There
are no subsequent events to disclose except for the following:
On October 6, 2023, the Company entered into an equity distribution agreement by and among the Company and various placement agents in connection with the sale by the
Company of shares of its common stock, par value $0.001 per share, having an aggregate offering price of up to $250,000, in amounts and at times to be determined by the Company.
Actual sales, if any, will depend on a variety of factors to be determined by the Company from time to time, including, among others, market conditions and the market price of the
Company’s common stock.
On November 17, 2023, the Company’s Board declared a quarterly distribution of $0.37 per share, which is payable on December 29, 2023 to holders of record as of December 8,
2023, and a supplemental distribution of $0.07 per share, which is payable on December 15, 2023 to holders of record as of December 1, 2023.
263
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
(a) Evaluation of Disclosure Controls and Procedures
As of September 30, 2023 (the end of the period covered by this report), management, with the participation of our chief executive officer and chief financial officer, evaluated the
effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act). Based on that evaluation, our
management, including the chief executive officer and chief financial officer, concluded that, at the end of such period, our disclosure controls and procedures were effective and
provided reasonable assurance that information required to be disclosed in our periodic SEC filings is recorded, processed, summarized and reported within the time periods specified
in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as
appropriate, to allow timely decisions regarding required disclosure. Notwithstanding the foregoing, a control system, no matter how well designed and operated, can provide only
reasonable, not absolute, assurance that it will detect or uncover failures within the Company to disclose material information otherwise required to be set forth in the Company’s
periodic reports.
(b) Management’s Report on Internal Control Over Financial Reporting
Management’s Report on Internal Control Over Financial Reporting and Ernst & Young LLP's Report of Independent Registered Public Accounting Firm are included in “Item 8.
Consolidated Financial Statements and Supplementary Data” of this annual report on Form 10-K.
(c) Changes in Internal Controls Over Financial Reporting
Management has not identified any change in our internal control over financial reporting that occurred during the fourth fiscal quarter of 2023 that has materially affected, or is
reasonably likely to materially affect, our internal control over financial reporting.
Item 9B. Other Information
During the fiscal quarter ended September 30, 2023, none of our directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of
our securities to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.
Not applicable.
264
PART III
Item 10. Directors, Executive Officers and Corporate Governance
The information required by Item 10 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2024 Annual Meeting of Stockholders, to be filed with the
SEC within 120 days following the end of our fiscal year.
Item 11. Executive Compensation
The information required by Item 11 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2024 Annual Meeting of Stockholders, to be filed with the
SEC within 120 days following the end of our fiscal year.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information required by Item 12 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2024 Annual Meeting of Stockholders, to be filed with the
SEC within 120 days following the end of our fiscal year.
Item 13. Certain Relationships and Related Transactions, and Director Independence
The information required by Item 13 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2024 Annual Meeting of Stockholders, to be filed with the
SEC within 120 days following the end of our fiscal year.
Item 14. Principal Accountant Fees and Services
The information required by Item 14 is hereby incorporated by reference from our definitive Proxy Statement relating to our 2024 Annual Meeting of Stockholders, to be filed with the
SEC within 120 days following the end of our fiscal year.
265
PART IV
Item 15. Exhibits and Financial Statement Schedules
The following documents are filed as part of this annual report on Form 10-K:
(1)
(2)
(3)
Financial Statements — Refer to Item 8 starting on page 118
Financial Statement Schedules — None
Exhibits
3.1
3.2
3.3
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
4.11
Form of Certificate of Incorporation (Incorporated by reference to Exhibit (a)(2) to the Registrant’s Pre-effective Amendment No. 3 to the Registration Statement
on Form N-2 (File No. 333-163279), filed on March 25, 2010).
Certificate of Amendment to Certificate of Incorporation of Golub Capital BDC, Inc. (Incorporated by reference to Exhibit 3.1 to the Registrant's Current Report on
Form 8-K (File No. 814-00794), filed on September 4, 2019).
Amended and Restated Bylaws (Incorporated by reference to Exhibit 3.3 to the Registrant's Form 10-K (File No. 814-00794), filed November 21, 2022.)
Form of Stock Certificate (Incorporated by reference to Exhibit (d) to the Registrant’s Pre-effective Amendment No. 3 to the Registration Statement on Form N-2
(File No. 333-163279), filed on March 25, 2010).
Form of Subscription Certificate (Incorporated by reference to Exhibit (d)(2) to the Registrant’s Registration Statement on Form N-2 (File No. 333-174756), filed
on June 7, 2011).
Form of Subscription Agent Agreement (Incorporated by reference to Exhibit (d)(4) to the Registrant’s Registration Statement on Form N-2 (File No. 333-
174756), filed on June 7, 2011).
Form of Warrant Agreement (Incorporated by reference to Exhibit (d)(5) to the Registrant’s Registration Statement on Form N-2 (File No. 333-174756), filed on
June 7, 2011).
Form of Certificate of Designation for Preferred Stock (Incorporated by reference to Exhibit (d)(6) to the Registrant’s Pre-effective Amendment No. 1 to the
Registration Statement on Form N-2 (File No. 333-174756), filed on August 25, 2011).
Form T-1 Statement of Eligibility of U.S. Bank National Association, as Trustee, with respect to the Form of Indenture (Incorporated by reference to Exhibit (d)(7)
to the Registrant’s Pre-effective Amendment No. 1 to the Registration Statement on Form N-2 (File No. 333-174756), filed on August 25, 2011).
Description of securities
Indenture, dated as of October 2, 2020, by and between Golub Capital BDC, Inc. and U.S. Bank National Association, as trustee (Incorporated by reference to
Exhibit 4.1 to the Registrant’s Current Report on Form 8-K (File No. 814-00794), filed on October 5, 2020).
First Supplemental Indenture, dated as of October 2, 2020, relating to the 3.375% Notes due 2024, by and between Golub Capital BDC, Inc. and U.S. Bank
National Association, as trustee. (Incorporated by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K (File No. 814-00794), filed on October
5, 2020).
Form of 3.375% Notes due 2024. (Incorporated by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K (File No. 814-00794), filed on October
5, 2020).
Second Supplemental Indenture, dated as of February 24, 2021, related to the 2.500% Notes due 2026, by and between Golub Capital BDC, Inc. and U.S. Bank
National Association, as trustee. (Incorporated by reference to Exhibit 4.1 to the Registrant's Current Report on Form 8-K (File No.
814-00794), filed on February 24, 2021).
*
266
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
4.12
4.13
4.14
10.1
10.2
10.3
10.4
10.5
10.6
10.7
10.8
10.9
10.10
10.11
10.12
10.13
Form of 2.500% Notes due 2026. (Incorporated by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K (File No. File No. 814-00794), filed on
February 24, 2021).
Third Supplemental Indenture, dated as of August 3, 2021, relating to the 2.050% Notes due 2027, by and between Golub Capital BDC, Inc. and U.S. Bank
National Association, as trustee. (Incorporated by reference to Exhibit 4.2 to the Registrant's Current Report on Form 8-K (File No. 814-00794), filed on August
3, 2021).
Form of 2.050% Notes due 2027. (Incorporated by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K (File No. 814-00794), filed on August
3, 2021).
Fourth Amended and Restated Investment Advisory Agreement, dated as of August 3, 2023, by and between Golub Capital BDC, Inc. and GC Advisors, LLC.
Form of Custody Agreement (Incorporated by reference to Exhibit (j) to the Registrant’s Pre-effective Amendment No. 5 to the Registration Statement on Form
N-2 (File No. 333-163279), filed on April 12, 2010).
Form of Administration Agreement between Registrant and GC Service Company LLC (Incorporated by reference to Exhibit (k)(2) to the Registrant’s Pre-
effective Amendment No. 3 to the Registration Statement on Form N-2 (File No. 333-163279), filed on March 24, 2010).
Form of Trademark License Agreement between the Registrant and Golub Capital LLC (Incorporated by reference to Exhibit (k)(3) to the Registrant’s Pre-
effective Amendment No. 3 to the Registration Statement on Form N-2 (File No. 333-163279), filed on March 24, 2010).
Amended and Restated Dividend Reinvestment Plan (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K (File No. 814-
00794), filed on May 5, 2011).
Indenture, dated as of November 16, 2018, by and between Golub Capital BDC CLO III LLC and US Bank National Association (Incorporated by reference to
Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 814-00794), filed on November 21, 2018).
First Supplemental Indenture, dated as of June 30, 2023, by and between Golub Capital BDC CLO III LLC, as Issuer, and U.S. Bank Trust Company, National
Association, as Trustee, and consented to by GC Advisors LLC, as Collateral Manager (Incorporated by reference to Exhibit 10.1 to the Registrant's Current
Report on Form 8-K (File No. 814-00794), filed on June 30, 2023).
Collateral Management Agreement, dated as of November 16, 2018, by and between Golub Capital BDC CLO III LLC and GC Advisors LLC (Incorporated by
reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K (File No. 814-00794), filed on November 21, 2018).
Amended and Restated Revolving Loan Agreement, dated as of June 21, 2019, by and among the Registrant, as the borrower, and GC Advisors LLC, as the
lender (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K (File No. 814-00794), filed on June 25, 2019).
First Amendment to the Amended and Restated Revolving Loan Agreement, dated as of October 28, 2019, by and between Golub Capital BDC, Inc. as the
borrower and GC Advisors LLC as the lender (Incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K (File No. 814-00794), filed
on October 31, 2019).
Second Amendment to Amended and Restated Revolving Loan Agreement, dated as of June 15, 2022, by and among Golub Capital BDC, Inc., as the borrower,
and GC Advisors LLC, as the lender. (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current report on Form 8-K (File No. 814-00794), filed on
June 16, 2022).
Note Purchase Agreement, dated December 13, 2018, by and among GCIC CLO II LLC and Wells Fargo Securities, LLC (Incorporated by reference to Exhibit
10.1 to Golub Capital Investment Corporation’s Current Report on Form 8-K (File No. 814-01128), filed on December 19, 2018).
Indenture, dated December 13, 2018, by and between GCIC CLO II LLC and The Bank of New York Mellon Trust Company, N.A. (Incorporated by reference to
Exhibit 10.2 to Golub Capital Investment Corporation’s Current Report on Form 8-K (File No. 814-01128), filed on December 19, 2018).
267
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
10.14
10.15
10.16
10.17
10.18
10.19
10.20
10.21
10.22
10.23
Collateral Management Agreement, dated December 13, 2018, by and between GCIC CLO II LLC and GC Advisors LLC (Incorporated by reference to Exhibit
10.1 to Golub Capital Investment Corporation’s Current Report on Form 8-K (File No. 814-01128), filed on December 19, 2018).
Master Loan Sale Agreement by and among Golub Capital Investment Corporation, as the seller, GC Advisors LLC, as the closing date seller, GCIC CLO II
LLC, as the buyer, and GCIC Funding LLC, as the warehouse borrower, dated as of December 13, 2018 (Incorporated by reference to Exhibit 10.4 to Golub
Capital Investment Corporation’s Current Report on Form 8-K (File No. 814-01128), filed on December 19, 2018).
Master Loan Sale Agreement by and among Golub Capital Investment Corporation, as the seller, GCIC CLO II Depositor LLC, as the intermediate seller, and
GCIC CLO II LLC, as the buyer, dated as of December 13, 2018 (Incorporated by reference to Exhibit 10.5 to Golub Capital Investment Corporation’s Current
Report on Form 8-K (File No. 814-01128), filed on December 19, 2018).
First Supplemental Indenture, dated as of December 21, 2020, by and between GCIC CLO II LLC, as Issuer, and The Bank of New York Mellon Trust
Company, National Association, as Trustee to the Indenture, dated as of December 13, 2018, among the Issuer and Trustee. (Incorporated by reference to
Exhibit 10.1 to the Registrant's Quarterly Report on Form 10-Q (File No. 814-00794), filed on February 8, 2021).
Second Supplemental Indenture, dated as of June 30, 2023, by and between GCIC CLO II LLC, as Issuer, and The Bank of New York Mellon Trust Company,
National Association, as Trustee, and consented to by GC Advisors LLC, as Collateral Manager and The Bank of New York Mellon Trust Company, National
Association, as Collateral Administrator. (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current report on Form 8-K (File No. 814-00794), filed on
June 30, 2023).
Senior Secured Revolving Credit Agreement, dated as of February 11, 2021, by and among Golub Capital BDC, Inc., as borrower, JPMorgan Chase Bank,
N.A., as administrative agent and as collateral agent, and the lenders, syndication agents, joint bookrunners, and joint lead arrangers party thereto.
(Incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K (File No. 814-00794), filed on February 12, 2021).
Commitment Increase Agreement, dated as of October 14, 2021, by Signature Bank, as Increasing Lender, Wells Fargo Bank, National Association and
Regions Bank, each as an Assuming Lender, in favor of the Company, as borrower, and JPMorgan Chase Bank, N.A., as administrative agent under the
Revolving Credit Facility. (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current report on Form 8-K (File No. 814-00794), filed on October 18,
2021).
Commitment Increase Agreement, dated as of November 23, 2021, by First National Bank of Pennsylvania, as Assuming Lender, JPMorgan Chase Bank, N.A.,
MUFG Union Bank, N.A., CIBC Bank USA, and Sumitomo Mitsui Banking Corporation, each as an Increasing Lender, in favor of Golub Capital BDC, Inc., as
borrower, and JPMorgan Chase Bank, N.A., as administrative agent under the Senior Secured Revolving Credit Facility, dated as of February 11, 2021, as
amended, among Golub Capital BDC, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as collateral agent, and the lenders,
syndication agents, joint bookrunners, and joint lead arrangers party thereto. (Incorporated by reference to Exhibit 10.2 to the Registrant’s Current report on
Form 8-K (File No. 814-00794), filed on November 24, 2021).
Amendment No. 1, dated as of November 19, 2021, to Senior Secured Revolving Credit Agreement, dated as of February 11, 2021, by and among, Golub
Capital BDC, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as collateral agent, and the lenders, syndication agents, joint
bookrunners, and joint lead arrangers party thereto. (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current report on Form 8-K/A (File No. 814-
00794), filed on December 14, 2021).
Commitment Increase Agreement, dated as of December 17, 2021, by Comerica Bank, and Capital One, National Association, each as an Assuming Lender, in
favor of Golub Capital BDC, Inc., as borrower, and JPMorgan Chase Bank, N.A., as administrative agent under the Senior Secured Revolving Credit Facility,
dated as of February 11, 2021, as amended, among Golub Capital BDC, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as
collateral agent, and the lenders, syndication agents, joint bookrunners, and joint lead arrangers party thereto. (Incorporated by reference to Exhibit 10.1 to the
Registrant’s Current report on Form 8-K (File No. 814-00794), filed on December 21, 2021).
268
Golub Capital BDC, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(In thousands, except shares and per share data)
10.24
10.25
10.26
10.27
14.1
14.2
21.1
23.1
24.1
25.1
31.1
31.2
32.1
97.1
99.1
101.INS
101.SCH
101.CAL
101.DEF
101.LAB
101.PRE
104
Amendment No. 2, dated as of September 2, 2022, to Senior Secured Revolving Credit Agreement, dated as of February 11, 2021, as amended, by and
among, Golub Capital BDC, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as collateral agent, and the lenders, syndication
agents, joint bookrunners, and joint lead arrangers party thereto. (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current report on Form 8-K
(File No. 814-00794), filed on September 8, 2022).
Commitment Increase Agreement, dated as of September 16, 2022, by Santander Bank, N.A., as an Assuming Lender, in favor of Golub Capital BDC, Inc.,
as borrower, and JPMorgan Chase Bank, N.A., as administrative agent under the Senior Secured Revolving Credit Facility, dated as of February 11, 2021, as
amended, among Golub Capital BDC, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as collateral agent, and the lenders,
syndication agents, joint bookrunners, and joint lead arrangers party thereto. (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current report on
Form 8-K (File No. 814-00794), filed on September 20, 2022).
Amended and Restated Senior Secured Revolving Credit Agreement, dated as of March 17, 2023, by and among Golub Capital BDC, Inc., as borrower, and
JPMorgan Chase Bank, N.A., as administrative agent under the Senior Secured Revolving Credit Facility, dated as of February 11, 2021, as amended,
among Golub Capital BDC, Inc., as borrower, JPMorgan Chase Bank, N.A., as administrative agent and as collateral agent, and the lenders, syndication
agents, joint bookrunners, and joint lead arrangers party thereto. (Incorporated by reference to Exhibit 10.1 to the Registrant’s Current report on Form 8-K
(File No. 814-00794), filed on March 20, 2023).
Equity Distribution Agreement, dated as of October 6, 2023, by and among Golub Capital BDC, Inc. GC Advisors LLC, Golub Capital LLC, Keefe Bruyette &
Woods, Inc. and Regions Securities LLC.
Code of Ethics of the Registrant and GC Advisors.
Code of Ethics of GC Advisors LLC.
List of Subsidiaries.
Consent of Ernst & Young LLP
Power of attorney (included on the signature page hereto).
Statement of Eligibility of Trustee on From T-1. (Incorporated by reference to Exhibit 25.1 to the Registrant's Form 10-Q (File No. 814-00794), filed February
7, 2020.)
Certification of Chief Executive Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.
Certification of Chief Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.
Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to section 906 of the Sarbanes-
Oxley Act of 2002.
Clawback Policy
Privacy Policy of the Registrant.
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline
XBRL document.
Inline XBRL Taxonomy Extension Schema Document.
Inline XBRL Taxonomy Extension Calculation Linkbase Document
Inline XBRL Taxonomy Extension Definition Linkbase Document.
Inline XBRL Taxonomy Extension Label Linkbase Document.
Inline XBRL Taxonomy Extension Presentation Linkbase Document.
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
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* Filed herewith
269
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this Annual Report on Form 10-K to be signed on its behalf
by the undersigned, thereunto duly authorized.
SIGNATURES
Date: November 20, 2023
By:
Golub Capital BDC, Inc.
A Delaware Corporation
/s/ David B. Golub
Name: David B. Golub
Title: Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Lawrence E. Golub, David B. Golub and Christopher C. Ericson
as his or her true and lawful attorneys-in-fact, each with full power of substitution, for him or her in any and all capacities, to sign any amendments to this Annual Report on Form 10-K
and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of
said attorneys-in-fact or their substitute or substitutes may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.
POWER OF ATTORNEY
Signature
Title
/s/ David B. Golub
David B. Golub
Chief Executive Officer and Director
(Principal Executive Officer)
/s/ Christopher C. Ericson
Christopher C. Ericson
Chief Financial Officer
(Principal Accounting and Financial Officer)
Date
November 20, 2023
November 20, 2023
/s/ Lawrence E. Golub
Lawrence E. Golub
/s/ John T. Baily
John T. Baily
/s/ Kenneth F. Bernstein
Kenneth F. Bernstein
/s/ Lofton P. Holder
Lofton P. Holder
/s/ Anita J. Rival
Anita J. Rival
/s/ William M. Webster IV
William M. Webster IV
Chairman of the Board of Directors
November 20, 2023
Director
Director
Director
Director
Director
270
November 20, 2023
November 20, 2023
November 20, 2023
November 20, 2023
November 20, 2023
DESCRIPTION OF SECURITIES
Exhibit 4.7
As of September 30, 2023, Golub Capital BDC, Inc. (“we,” “our,” “us” or the “Company”) had one class of securities registered under Section 12 of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”): our common stock, par value $0.001 per share.
For purposes of this exhibit, references to “we,” “our” and “us” refer only to Golub Capital BDC, Inc. and not to any of its current or future subsidiaries and references to “subsidiaries”
refer only to consolidated subsidiaries of and exclude any investments held by Golub Capital BDC, Inc. in the ordinary course of business which are not, under GAAP, consolidated on
the financial statements of Golub Capital BDC, Inc. and its subsidiaries.
Capitalized terms used but not defined herein shall have the meaning ascribed to them in the Annual Report on Form 10-K to which this Description of Securities is attached as an
exhibit.
The following description is based on relevant portions of the Delaware General Corporation Law (the “DGCL”) and on our certificate of incorporation and bylaws, each of which is filed
as an exhibit to our Annual Report on Form 10-K of which this Exhibit 4.7 is a part. This summary is not necessarily complete, and we refer you to the DGCL and our certificate of
incorporation and bylaws for a more detailed description of the provisions summarized below.
Capital Stock
Our authorized stock currently consists of 350,000,000 shares of common stock, par value $0.001 per share, and 1,000,000 shares of preferred stock, par value $0.001 per share. Our
common stock is traded on The Nasdaq Global Select Market under the ticker symbol “GBDC”. There are no outstanding options or warrants to purchase our stock. No stock has been
authorized for issuance under any equity compensation plans. Under Delaware law, our stockholders generally are not personally liable for our debts or obligations.
The following are our outstanding classes of securities as of September 30, 2023:
Title of Class
Common Stock
Preferred Stock
(2) Amount authorized
(3) Amount held by us or
for Our Account
350,000,000
1,000,000
—
—
(4) Amount Outstanding
Exclusive of Amounts
shown Under (3)
169,594,742
—
All shares of our common stock have equal rights as to earnings, assets, dividends and other distributions and voting and, when they are issued, will be duly authorized, validly issued,
fully paid and nonassessable. Distributions may be paid to the holders of our common stock if, as and when authorized by our board of directors and declared by us out of funds legally
available therefrom. Shares of our common stock have no preemptive, exchange, conversion or redemption rights and are freely transferable, except when their transfer is restricted by
federal and state securities laws or by contract. In the event of our liquidation, dissolution or winding up, each share of our common stock would be entitled to share ratably in all of our
assets that are legally available for distribution after we pay all debts and other liabilities and subject to any preferential rights of holders of our preferred stock, if any preferred stock is
outstanding at such time. Each share of our common stock is entitled to one vote on all matters submitted to a vote of stockholders, including the election of directors. Except as
provided with respect to any other class or series of stock, the holders of our common stock will possess exclusive voting power. There is no cumulative voting in the
election of directors, which means that holders of a majority of the outstanding shares of common stock can elect all of our directors, and holders of less than a majority of such shares
will not be able to elect any directors.
Provisions of the DGCL and Our Certificate of Incorporation and Bylaws
Limitation on Liability of Directors and Officers; Indemnification and Advance of Expenses
The indemnification of our officers and directors is governed by Section 145 of the DGCL, and our certificate of incorporation and bylaws. Subsection (a) of DGCL Section 145
empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such
action, suit or proceeding if (1) such person acted in good faith, (2) in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation and (3)
with respect to any criminal action or proceeding, such person had no reasonable cause to believe the person’s conduct was unlawful.
Subsection (b) of DGCL Section 145 empowers a corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in
good faith and in a manner the person reasonably believed to be in, or not opposed to, the best interests of the corporation, and except that no indemnification may be made in respect
of any claim, issue or matter as to which such person has been adjudged to be liable to the corporation unless and only to the extent that the Delaware Court of Chancery or the court in
which such action or suit was brought determines upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court deems proper.
DGCL Section 145 further provides that to the extent that a present or former director or officer is successful, on the merits or otherwise, in the defense of any action, suit or proceeding
referred to in subsections (a) and (b) of Section 145, or in defense of any claim, issue or matter therein, such person will be indemnified against expenses (including attorneys’ fees)
actually and reasonably incurred by such person in connection with such action, suit or proceeding. In all cases in which indemnification is permitted under subsections (a) and (b) of
Section 145 (unless ordered by a court), it will be made by the corporation only as authorized in the specific case upon a determination that indemnification of the present or former
director, officer, employee or agent is proper in the circumstances because the applicable standard of conduct has been met by the party to be indemnified. Such determination must
be made, with respect to a person who is a director or officer at the time of such determination, (1) by a majority vote of the directors who are not parties to such action, suit or
proceeding, even though less than a quorum, (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, (3) if there are no
such directors, or if such directors so direct, by independent legal counsel in a written opinion or (4) by the stockholders. The statute authorizes the corporation to pay expenses
incurred by an officer or director in advance of the final disposition of a proceeding upon receipt of an undertaking by or on behalf of the director or officer to repay such amount if it is
ultimately determined that such person is not entitled to be indemnified by the corporation as authorized. DGCL Section 145 also provides that indemnification and advancement of
expenses permitted under such Section are not to be exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any
bylaw, agreement, vote of stockholders or disinterested directors or otherwise. DGCL Section 145 also authorizes the corporation to purchase and maintain liability insurance on behalf
of its directors, officers, employees and agents regardless of whether the corporation would have the statutory power to indemnify such persons against the liabilities insured.
Our certificate of incorporation provides that our directors will not be liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director to the fullest extent
permitted by the current DGCL or as the DGCL may hereafter be amended. DGCL Section 102(b)(7) provides that the personal liability of a director to a corporation or its stockholders
for breach of fiduciary duty as a director may be eliminated except for liability (1) for any breach of the director’s duty of loyalty to the corporation or its stockholders, (2) for acts or
omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (3) under Section 174 of the DGCL, relating to unlawful payment of dividends or
unlawful stock purchases or redemption of stock or (4) for any transaction from which the director derives an improper personal benefit.
Our certificate of incorporation and bylaws provide for the indemnification of any person to the full extent permitted, and in the manner provided, by the current DGCL or as the DGCL
may hereafter be amended. In addition, we have entered into indemnification agreements with each of our directors and officers in order to effect the foregoing except to the extent that
such indemnification would exceed the limitations on indemnification under Section 17(h) of the 1940 Act.
Delaware Anti-Takeover Law
The DGCL and our certificate of incorporation and bylaws contain provisions that could make it more difficult for a potential acquirer to acquire us by means of a tender offer, proxy
contest or otherwise. These provisions are expected to discourage certain coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire
control of us to negotiate first with our board of directors. These measures may delay, defer or prevent a transaction or a change in control that might otherwise be in the best interests
of our stockholders. We believe, however, that the benefits of these provisions outweigh the potential disadvantages of discouraging any such acquisition proposals because the
negotiation of such proposals may improve their terms.
We are subject to the provisions of Section 203 of the DGCL regulating corporate takeovers. In general, these provisions prohibit a Delaware corporation from engaging in any
business combination with any interested stockholder for a period of three years following the date that the stockholder became an interested stockholder, unless:
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prior to such time, the board of directors approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;
upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of
the corporation outstanding at the time the transaction commenced; or
on or after the date the business combination is approved by the board of directors and authorized at a meeting of stockholders, by at least two-thirds of the outstanding voting
stock that is not owned by the interested stockholder.
Section 203 defines “business combination” to include the following:
any merger or consolidation involving the corporation and the interested stockholder;
any sale, transfer, pledge or other disposition (in one transaction or a series of transactions) of
10% or more of either the aggregate market value of all the assets of the corporation or the aggregate market value of all the outstanding stock of the corporation involving the
interested stockholder;
subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;
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any transaction involving the corporation that has the effect of increasing the proportionate share of the stock of any class or series of the corporation owned by the interested
stockholder; or
the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits provided by or through the corporation.
In general, Section 203 defines an interested stockholder as any entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation and any entity or
person affiliated with or controlling or controlled by any of these entities or persons.
The statute could prohibit or delay mergers or other takeover or change in control attempts and, accordingly, may discourage attempts to acquire us.
Election of Directors
Our certificate of incorporation and bylaws provide that the affirmative vote of the holders of a majority of the votes cast by stockholders present in person or by proxy at an annual or
special meeting of stockholders and entitled to vote thereat will be required to elect a director. Under our certificate of incorporation, our board of directors may amend the bylaws to
alter the vote required to elect directors.
Classified Board of Directors
Our board of directors is divided into three classes of directors serving staggered three-year terms, with the term of office of only one of the three classes expiring each year. A
classified board may render a change in control of us or removal of our incumbent management more difficult. We believe, however, that the longer time required to elect a majority of a
classified board of directors helps to ensure the continuity and stability of our management and policies.
Number of Directors; Removal; Vacancies
Our certificate of incorporation provides that the number of directors will be set only by the board of directors by resolution or amendment to our bylaw adopted by the affirmative vote of
a majority of the directors. Our bylaws provide that a majority of our entire board of directors may at any time increase or decrease the number of directors. However, unless our bylaws
are amended, the number of directors may never be less than four nor more than eight. Under the DGCL, unless the certificate of incorporation provides otherwise (which our certificate
of incorporation does not), directors on a classified board such as our board of directors may be removed only for cause. Under our certificate of incorporation and bylaws, any vacancy
on the board of directors, including a vacancy resulting from an enlargement of the board of directors, may be filled only by vote of a majority of the directors then in office. The
limitations on the ability of our stockholders to remove directors and fill vacancies could make it more difficult for a third-party to acquire, or discourage a third-party from seeking to
acquire, control of us.
Action by Stockholders
Under our certificate of incorporation stockholder action can be taken only at an annual or special meeting of stockholders or by unanimous written consent in lieu of a meeting. This
may have the effect of delaying consideration of a stockholder proposal until the next annual meeting.
Advance Notice Provisions for Stockholder Nominations and Stockholder Proposals
Our bylaws provide that with respect to an annual meeting of stockholders, nominations of persons for election to the board of directors and the proposal of business to be considered
by stockholders may be made only (1) by or at the direction of the board of directors, (2) pursuant to our notice of meeting or (3) by a stockholder who is entitled to vote at the meeting
and who has complied with the advance notice procedures of the bylaws. Nominations of persons for election to the board of directors at a special meeting may be made only by or at
the direction of the
board of directors, and provided that the board of directors has determined that directors will be elected at the meeting, by a stockholder who is entitled to vote at the meeting and who
has complied with the advance notice provisions of the bylaws.
The purpose of requiring stockholders to give us advance notice of nominations and other business is to afford our board of directors a meaningful opportunity to consider the
qualifications of the proposed nominees and the advisability of any other proposed business and, to the extent deemed necessary or desirable by our board of directors, to inform
stockholders and make recommendations about such qualifications or business, as well as to provide a more orderly procedure for conducting meetings of stockholders. Although our
bylaws do not give our board of directors any power to disapprove stockholder nominations for the election of directors or proposals recommending certain action, they may have the
effect of precluding a contest for the election of directors or the consideration of stockholder proposals if proper procedures are not followed and of discouraging or deterring a third
party from conducting a solicitation of proxies to elect its own slate of directors or to approve its own proposal without regard to whether consideration of such nominees or proposals
might be harmful or beneficial to us and our stockholders.
Stockholder Meetings
Our bylaws provide that any action required or permitted to be taken by stockholders at an annual meeting or special meeting of stockholders may only be taken if it is properly brought
before such meeting. In addition, in lieu of such a meeting, any such action may be taken by the unanimous written consent of our stockholders. Our certificate of incorporation and
bylaws also provide that, except as otherwise required by law, special meetings of the stockholders can only be called by the chairman of the board, the chief executive officer or the
board of directors. In addition, our bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of stockholders, including proposed
nominations of candidates for election to the board of directors. Stockholders at an annual meeting may only consider proposals or nominations specified in the notice of meeting or
brought before the meeting by or at the direction of the board of directors, or by a stockholder of record on the record date for the meeting who is entitled to vote at the meeting and who
has delivered timely written notice in proper form to the secretary of the stockholder’s intention to bring such business before the meeting. These provisions could have the effect of
delaying until the next stockholder meeting stockholder actions that are favored by the holders of a majority of our outstanding voting securities.
Calling of Special Meetings of Stockholders
Our certificate of incorporation and bylaws provide that special meetings of stockholders may be called by our board of directors, the chairman of the board and our chief executive
officer.
Conflict with 1940 Act
Our bylaws provide that, if and to the extent that any provision of the DGCL or any provision of our certificate of incorporation or bylaws conflicts with any provision of the 1940 Act, the
applicable provision of the 1940 Act will control.
CODE OF ETHICS
FOR
GOLUB CAPITAL BDC, INC.
GOLUB CAPITAL DIRECT LENDING CORPORATION
GOLUB CAPITAL BDC 3, INC.
GOLUB CAPITAL BDC 4, INC.
GOLUB CAPITAL DIRECT LENDING UNLEVERED CORPORATION
GOLUB CAPITAL PRIVATE CREDIT FUND
GC ADVISORS LLC
Section I Statement of General Fiduciary Principles
This Code of Ethics (the “Code”) has been adopted by each of Golub Capital BDC, Inc., Golub Capital BDC 3, Inc., Golub Capital BDC 4, Inc.,
Golub Capital Direct Lending Corporation, Golub Capital Direct Lending Unlevered Corporation, and Golub Capital Private Credit Fund (collectively, the
“Corporation”), and GC Advisors LLC, the Corporation’s investment adviser (the “Adviser”), in compliance with Rule 17j-1 under the Investment Company Act
of 1940 (the “Act”). The purpose of the Code is to establish standards and procedures for the detection and prevention of activities by which persons having
knowledge of the investments and investment intentions of the Corporation may abuse their fiduciary duty to the Corporation, and otherwise to deal with the
types of conflict of interest situations to which Rule 17j-1 is addressed.
The Code is based on the principle that the directors and officers of the Corporation, and the managers, partners, officers and employees of the
Adviser, who provide services to the Corporation, owe a fiduciary duty to the Corporation to conduct their personal securities transactions in a manner that
does not interfere with the Corporation’s transactions or otherwise take unfair advantage of their relationship with the Corporation. All Access Persons are
expected to adhere to this general principle as well as to comply with all of the specific provisions of this Code that are applicable to them. Any Access
Persons who are affiliated with the Adviser or another entity that is a registered investment adviser is, in addition, expected to comply with the provisions of the
code of ethics that has been adopted by the Adviser or such other investment adviser. The Adviser has adopted a separate code of ethics pursuant to the
Investment Advisers Act of 1940, and the rules thereunder (the “Adviser’s Code of Ethics”). The Adviser will provide a written report, at least annually, to the
Corporation’s board of directors describing any issues arising under the Adviser’s Code of Ethics or procedures since the last report to the board, including, but
not limited to, information about material violations of the Adviser’s Code of Ethics or procedures and sanctions imposed in response to material violations and
certifying that the Adviser has adopted procedures reasonably necessary to prevent violations of the Adviser’s Code of Ethics.
Technical compliance with the Code will not automatically insulate any Access Persons from scrutiny of transactions that show a pattern of
compromise or abuse of the individual’s fiduciary duty to the Corporation. Accordingly, all Access Persons must seek to avoid any actual or potential conflicts
between their personal interests and the interests of the Corporation and its stockholders. In sum, all Access Persons shall place the interests of the
Corporation before their own personal interests.
26985410.4.BUSINESS
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All Access Persons must read this Code of Ethics.
Section II Definitions
(A) “Access Person” means any director, officer, general partner or Advisory Person (as defined below) of the Corporation or the Adviser.
(B) An “Advisory Person” of the Corporation or the Adviser means: (i) any director, officer general partner or employee of the Corporation or the Adviser, or
any company in a Control (as defined below) relationship to the Corporation or the Adviser, who in connection with such person’s regular functions or duties
makes, participates in, or obtains information regarding the purchase or sale of any Covered Security (as defined below) by the Corporation, or whose functions
relate to the making of any recommendation with respect to such purchases or sales; (ii) any natural person in a Control relationship to the Corporation or the
Adviser, who obtains information concerning recommendations made to the Corporation with regard to the purchase or sale of any Covered Security by the
Corporation and (iii) any other person deemed to be an Advisory Person by the Chief Compliance Officer.
(C) “Beneficial Ownership” is interpreted in the same manner as it would be under Rule 16a-1(a)(2) under the Securities Exchange Act of 1934 (the “1934
Act”) in determining whether a person is a beneficial owner of a security for purposes of Section 16 of the 1934 Act and the rules and regulations thereunder.
(D) “Chief Compliance Officer” means the Chief Compliance Officer of the Corporation (who also may serve as the compliance officer of the Adviser and/or
one or more affiliates of the Adviser).
(E) “Control” shall have the same meaning as that set forth in Section 2(a)(9) of the Act.
(F) “Covered Security” means a security as defined in Section 2(a)(36) of the Act, which includes: any note, stock, treasury stock, security future, bond,
debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-trust certificate, pre-organization
certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit for a security, fractional undivided interest in oil,
gas, or other mineral rights, any put, call, straddle, option, or privilege on any security (including a certificate of deposit) or on any group or index of securities
(including any interest therein or based on the value thereof), or any put, call, straddle, option, or privilege entered into on a national securities exchange
relating to foreign currency, or, in general, any interest or instrument commonly known as a “security,” or any certificate of interest or participation in, temporary
or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, any of the foregoing.
Except that “Covered Security” does not include: (i) direct obligations of the Government of the United States; (ii) bankers’ acceptances, bank
certificates of deposit, commercial paper and high-quality short-term debt instruments, including repurchase agreements; and (iii) shares issued by open-end
investment companies registered under the Act. References to a Covered Security in this Code (e.g., a prohibition or requirement applicable to the purchase or
sale of a Covered Security)
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shall be deemed to refer to and to include any warrant for, option in, or security immediately convertible into that Covered Security, and shall also include any
instrument that has an investment return or value that is based, in whole or in part, on that Covered Security (collectively, “Derivatives”). Therefore, except as
otherwise specifically provided by this Code: (i) any prohibition or requirement of this Code applicable to the purchase or sale of a Covered Security shall also
be applicable to the purchase or sale of a Derivative relating to that Covered Security; and (ii) any prohibition or requirement of this Code applicable to the
purchase or sale of a Derivative shall also be applicable to the purchase or sale of a Covered Security relating to that Derivative.
(G) “Independent Director” means a director of the Corporation who is not an “interested person” of the Corporation within the meaning of Section 2(a)(19) of
the Act.
(H) “Initial Public Offering” means an offering of securities registered under the Securities Act of 1933 (the “1933 Act”), the issuer of which, immediately
before the registration, was not subject to the reporting requirements of Sections 13 or 15(d) of the 1934 Act.
(I) “Investment Personnel” of the Corporation or the Adviser means: (i) any employee of the Corporation or the Adviser (or of any company in a Control
relationship to the Corporation or the Adviser) who, in connection with such person’s regular functions or duties, makes or participates in making
recommendations regarding the purchase or sale of securities by the Corporation; and (ii) any natural person who controls the Corporation or the Adviser and
who obtains information concerning recommendations made to the Corporation regarding the purchase or sale of securities by the Corporation.
(J) “Limited Offering” means an offering that is exempt from registration under the 1933 Act pursuant to Section 4(2) or Section 4(5) thereof or pursuant to
Rule 504, Rule 505, or Rule 506 thereunder.
(K) “Security Held or to be Acquired” by the Corporation means: (i) any Covered Security which, within the most recent 15 days: (A) is or has been held by the
Corporation; or (B) is being or has been considered by the Corporation or the Adviser for purchase by the Corporation; and (ii) any option to purchase or sell,
and any security convertible into or exchangeable for, a Covered Security described in Section II (K)(i).
(L) “17j-1 Organization” means the Corporation or the Adviser, as the context requires
Section III Objective and General Prohibitions
Access Persons may not engage in any investment transaction under circumstances in which such Access Persons benefits from or interferes
with the purchase or sale of investments by the Corporation. In addition, Access Persons may not use information concerning the investments or investment
intentions of the Corporation, or their ability to influence such investment intentions, for personal gain or in a manner detrimental to the interests of the
Corporation.
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Access Persons may not engage in conduct that is deceitful, fraudulent or manipulative, or that involves false or misleading statements, in
connection with the purchase or sale of investments by the Corporation. In this regard, Access Persons should recognize that Rule 17j-1 makes it unlawful for
any affiliated person of the Corporation, or any affiliated person of the Adviser, in connection with the purchase or sale, directly or indirectly, by the person of a
Security Held or to be Acquired by the Corporation to:
i. employ any device, scheme or artifice to defraud the Corporation;
ii. make any untrue statement of a material fact to the Corporation or omit to state to the Corporation a material fact necessary in order to
make the statements made, in light of the circumstances under which they are made, not misleading;
iii. engage in any act, practice or course of business that operates or would operate as a fraud or deceit upon the Corporation; or
iv. engage in any manipulative practice with respect to the Corporation.
Access Persons should also recognize that a violation of this Code or of Rule 17j-1 may result in the imposition of: (1) sanctions as provided by
Section VIII below; or (2) administrative, civil and, in certain cases, criminal fines, sanctions or penalties.
Section IV Prohibited Transactions
(A) Other than securities purchased or acquired by a fund affiliated with the Corporation and pursuant to an exemptive order under Section 57(i) of the Act
permitting certain types of co-investments, an Access Person may not purchase or otherwise acquire direct or indirect Beneficial Ownership of any Covered
Security, and may not sell or otherwise dispose of any Covered Security in which such person has direct or indirect Beneficial Ownership, if such person knows
or should know at the time of entering into the transaction that: (1) the Corporation has purchased or sold the Covered Security within the last 15 calendar days,
or is purchasing or selling or intends to purchase or sell the Covered Security in the next 15 calendar days; or (2) the Adviser has within the last 15 calendar
days considered purchasing or selling the Covered Security for the Corporation or within the next 15 calendar days intends to consider purchasing or selling the
Covered Security for the Corporation.
(B) No Access Person may purchase a Covered Security without first obtaining preapproval from the Chief Compliance Officer of the Corporation. From time
to time, the Chief Compliance Officer of the Corporation may exempt individual Covered Securities or categories of Covered Securities from this requirement.
(C) Investment Personnel of the Corporation or the Adviser must obtain approval from the Corporation or the Adviser, as the case may be, before directly or
indirectly acquiring Beneficial
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Ownership in any securities in an Initial Public Offering or in a Limited Offering, except when such securities are acquired by a fund affiliated with the
Corporation and pursuant to an exemptive order under Section 57(i) of the Act permitting certain types of co-investments. Such approval must be obtained
from the Chief Compliance Officer, unless the Chief Compliance Officer is the person seeking such approval, in which case it must be obtained from the
President of the 17j-1 Organization.
(D) No Access Person shall recommend any transaction in any Covered Securities by the Corporation without having disclosed to the Chief Compliance
Officer such Access Person’s interest, if any, in such Covered Securities or the issuer thereof, including: the Access Person’s Beneficial Ownership of any
Covered Securities of such issuer, except when such securities transactions are to be made by a fund affiliated with the Corporation and pursuant to an
exemptive order under Section 57(i) of the Act permitting certain types of co-investments; any contemplated transaction by the Access Person in such Covered
Securities; any position the Access Person has with such issuer; and any present or proposed business relationship between such issuer and the Access
Person (or a party which the Access Person has a significant interest).
Section V Reports by Access Persons
(A) Personal Securities Holdings Reports.
All Access Persons shall within 10 days of the date on which they become Access Persons, and thereafter, within 30 days after the end of each
calendar year, disclose the title, number of shares and principal amount of all Covered Securities in which they have a direct or indirect Beneficial Ownership as
of the date the person became an Access Person, in the case of such person’s initial report, and as of the last day of the year, as to annual reports. Such report
is hereinafter called a “Personal Securities Holdings Report.” Each Personal Securities Holdings Report must also disclose the name of any broker, dealer or
bank with whom the Access Person maintained an account in which any securities were held for the direct or indirect benefit of the Access Person as of the
date the person became an Access Person or as of the last day of the year, as the case may be. Each Personal Securities Holdings Report shall state the date
it is being submitted.
(B) Quarterly Transaction Reports.
Within 30 days after the end of each calendar quarter, each Access Person shall make a written report to the Chief Compliance Officer of all
transactions occurring in the quarter in a Covered Security in which such person had any direct or indirect Beneficial Ownership. Such report is hereinafter
called a “Quarterly Securities Transaction Report.”
A Quarterly Securities Transaction Report shall be in the form approved by the Chief Compliance Officer:
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(C) Independent Directors.
Notwithstanding the reporting requirements set forth in this Section V, an Independent Director who would be required to make a report under this
Section V solely by reason of being a director of the Corporation is not required to file a Personal Securities Holding Report upon becoming a director of the
Corporation or annually thereafter. Such an Independent Director also need not file a Quarterly Securities Transaction Report unless such director knew or, in
the ordinary course of fulfilling official duties as a director of the Corporation, should have known that during the 15-day period immediately preceding or after
the date of the transaction in a Covered Security by the director such Covered Security is or was purchased or sold by the Corporation or the Corporation or the
Adviser considered purchasing or selling such Covered Security.
(D) Access Persons of the Adviser.
An Access Person of the Adviser need not make a Personal Securities Holding Report or Quarterly Securities Transaction Report if the
information in such reports would duplicate information required to be recorded pursuant to the Adviser’s Code of Ethics.
(E) Brokerage Accounts and Statements.
Access Persons, except Independent Directors, shall:
(1) instruct the brokers, dealers or banks with whom they maintain such an account to provide duplicate account statements to the Chief
Compliance Officer.
(2) on an annual basis, certify that they have complied with the requirements of (1) above.
(F) Form of Reports.
A Quarterly Securities Transaction Report may consist of broker statements or other statements that provide a list of all personal Covered
Securities holdings and transactions in the time period covered by the report and contain the information required in a Quarterly Securities Transaction Report.
(G) Responsibility to Report.
Access Persons will be informed of their obligations to report, however, it is the responsibility of each Access Person to take the initiative to
comply with the requirements of this Section V. Any effort by the Corporation, or by the Adviser and its affiliates, to facilitate the reporting process does not
change or alter that responsibility. A person need not make a report hereunder with respect to transactions effected for, and Covered Securities held in, any
account over which the person has no direct or indirect influence or control.
(H) Where to File Reports and Forms.
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(1) All Quarterly Securities Transaction Reports and Personal Securities Holdings Reports, as well as Private Company Securities and IPO
Request and Reporting Forms, must be filed with the Chief Compliance Officer.
(2) The Chief Compliance Officer may, from time to time, adopt new methods to submit all Quarterly Securities Transaction Reports and
Personal Securities Holdings Reports, as well as Private Company Securities and IPO Request and Reporting Forms. These new methods, which could
include electronic submission of information equivalent to the information currently required under this Code, will be deemed to satisfy the reporting obligations
under this Code.
(I) Disclaimers.
Any report required by this Section V may contain a statement that the report will not be construed as an admission that the person making the
report has any direct or indirect Beneficial Ownership in the Covered Security to which the report relates.
Section VI Additional Prohibitions
(A) Confidentiality of the Corporation’s Transactions.
Until disclosed in a public report to stockholders or to the Securities and Exchange Commission (the “SEC”) in the normal course, all information
concerning the securities “being considered for purchase or sale” by the Corporation shall be kept confidential by all Access Persons and disclosed by them
only on a “need to know” basis. It shall be the responsibility of the Chief Compliance Officer to report any inadequacy found in this regard to the directors of the
Corporation.
(B) Insider Trading.
(1) Clearance of Transactions. The Corporation requires that all purchases and sales of Corporation securities by Access Persons (and their
respective immediate family members) be cleared by the Chief Compliance Officer or the Chief Compliance Officer’s designee prior to placing any order related
to such transactions. Currently, the only Corporation securities available for purchase is the common stock of Golub Capital BDC, Inc. traded on the Nasdaq
under the ticker symbol GBDC (“Shares”).
(2) Window Period. After receiving clearance from the Chief Compliance Officer of the Corporation, Access Persons may purchase or sell
Shares only during a designated “window period.” Should the end of the “window period” fall on a weekend, such window will be extended through close of
business on the following business day. Significantly, however, even during a “window period,” Access Persons may not engage in transactions involving
Shares if such person is in possession of material, nonpublic information on the trade date.
(3) Avoidance of Speculative Transactions. Certain types of transactions as well as the timing of trading may raise an inference of the improper
use of inside information. In order to avoid
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even the appearance of impropriety, the Corporation discourages trades by Access Persons that are of a short-term, speculative nature rather than for
investment purposes.
(4) Limited Disclosure. Access Persons who have access to material information regarding the Corporation or its operations should exercise the
utmost caution in preserving the confidentiality of that information. If anyone becomes aware of a leak of material information, whether inadvertent or otherwise,
such person should report such leak immediately to the Chief Compliance Officer. Any insider who “leaks” inside information to a “tippee” may be equally liable
with the tippee to third parties for any profit of the tippee. Of course, it will be necessary from time to time, for legitimate business reasons, to disclose material
information to persons outside of the Corporation. Such persons might include commercial bankers, investment bankers or other companies with whom the
Corporation may be pursuing a joint project. In such situations, material nonpublic information should not be conveyed until an express understanding, typically
in the form of the Corporation’s standard nondisclosure agreement, or “NDA,” has been reached that such information may not be used for trading purposes
and may not be further disclosed other than for legitimate business reasons. Please contact the Chief Compliance Officer before disclosing any material non-
public information regarding the Corporation to a third party or entering into an NDA.
Section VII Annual Certification
(A) Access Persons.
Access Persons who are directors, managers, partners, officers or employees of the Corporation or the Adviser shall be required to certify
annually that they have read this Code and/or the Adviser’s Code of Ethics, and that they understand the applicable code and recognize that they are subject
to it. Further, such Access Persons shall be required to certify annually that they have complied with the requirements of this Code and/or the Adviser’s Code
of Ethics.
(B) Board Review.
No less frequently than annually, the Corporation and the Adviser must furnish to the Corporation’s board of directors, and the board must
consider, a written report that: (A) describes any material issues arising under this Code or procedures since the last report to the board, including, but not
limited to, information about material violations of the Code or procedures and sanctions imposed in response to violations; and (B) certifies that the
Corporation or the Adviser, as applicable, has adopted procedures reasonably necessary to prevent Access Persons from violating the Code.
Section VIII Sanctions
Any violation of this Code shall be subject to the imposition of such sanctions by the 17j-1 Organization as may be deemed appropriate under the
circumstances to achieve the purposes of Rule 17j-1 and this Code. The sanctions to be imposed shall be determined by the board of directors, including a
majority of the Independent Directors, provided, however, that with respect to violations by persons who are directors, managers, partners, officers or
employees of the Adviser (or of a company that controls
8
the Adviser), the sanctions to be imposed shall be determined by the Adviser (or the controlling person thereof). Sanctions may include, but are not limited to,
suspension or termination of employment, a letter of censure and/or restitution of an amount equal to the difference between the price paid or received by the
Corporation and the more advantageous price paid or received by the offending person.
Section IX Administration and Construction
(A) The administration of this Code shall be the responsibility of the Chief Compliance Officer.
(B) The duties of the Chief Compliance Officer and the Chief Compliance Officer’s department are as follows:
(1) On an annual basis, providing all Access Persons a copy of this Code and informing such persons of their duties and obligations
hereunder including any supplemental training that may be required from time to time;
(2) Maintaining or supervising the maintenance of all records and reports required by this Code;
(3) Reviewing all Personal Securities Holdings Reports and Quarterly Securities Transaction Reports;
(4) Preparing listings of all transactions effected by Access Persons who are subject to the requirement to file Quarterly Securities
Transaction Reports and reviewing such transactions against a listing of all transactions effected by the Corporation;
(5) Issuance either personally or with the assistance of counsel as may be appropriate, of interpretations of any provision of this Code that
may appear inconsistent with the objectives of Rule 17j-1 and this Code;
(6) Conduct such inspections or investigations as shall reasonably be required to detect and report, with recommendations, any apparent
violations of this Code to the board of directors of the Corporation; and
(7) Submission of a written report to the board of directors of the Corporation, no less frequently than annually, that describes any issues
arising under the Code since the last such report, including but not limited to the information described in Section VII (B).
(C) The Chief Compliance Officer shall maintain and cause to be maintained in an easily accessible place at the principal place of business of the 17j-1
Organization, the following records and must make these records available to the SEC at any time and from time to time for reasonable periodic, special or
other examinations:
9
(1) A copy of all codes of ethics adopted by the Corporation or the Adviser and its affiliates, as the case may be, pursuant to Rule 17j-1 that
have been in effect at any time during the past 5 years;
(2) A record of each violation of such codes of ethics and of any action taken as a result of such violation for at least 5 years after the end of
the fiscal year in which the violation occurs;
(3) A copy of each report made by an Access Person for at least 2 years after the end of the fiscal year in which the report is made, and for an
additional 3 years in a place that need not be easily accessible;
(4) A copy of each report made by the Chief Compliance Officer to the board of directors for 2 years from the end of the fiscal year of the
Corporation in which such report is made or issued and for an additional 3 years in a place that need not be easily accessible;
(5) A list of all persons who are, or within the past 5 years have been, required to make reports pursuant to the Rule 17j-1 and this Code of
Ethics, or who are or were responsible for reviewing such reports;
(6) A copy of each report required by Section VII (B) for at least 2 years after the end of the fiscal year in which it is made, and for an
additional 3 years in a place that need not be easily accessible; and
(7) A record of any decision, and the reasons supporting the decision, to approve the acquisition by Investment Personnel of securities in an
Initial Public Offering or Limited Offering for at least 5 years after the end of the fiscal year in which the approval is granted.
(D) This Code may not be amended or modified except in a written form that is specifically approved by majority vote of the Independent Directors.
Adopted: March 5, 2010
Reviewed and Amended: November 27, 2012
Reviewed and Amended: February 2, 2016
Reviewed and Amended: August 2, 2017
Reviewed and Amended, effective: November 20, 2020
Reviewed and Amended, effective: November 19, 2021
Reviewed and Amended, effective: April 4, 2023
10
General
GC ADVISORS LLC
CODE OF ETHICS
This Code of Ethics for the Adviser supplements (i) the Joint Code of Ethics for Golub Capital BDC, Inc., Golub Capital BDC 3, Inc., and GC
Advisors LLC that is applicable in connection with Golub Capital BDC, Inc. and Golub Capital BDC 3, Inc. and (ii) the policies and procedures
contained in the Compliance Manual for the Adviser.
The Code of Ethics is predicated on the principle that the Adviser owes a fiduciary duty to its Clients. Accordingly, the Adviser’s employees
must avoid activities, interests and relationships that run contrary (or appear to run contrary) to the best interests of its Clients. At all times, Adviser
employees must:
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Place Client interests ahead of the Adviser’s interests – As a fiduciary, the Adviser must serve its Clients’ best interests. In other
words, Adviser employees may not benefit at the expense of the Clients. This concept is particularly relevant when employees are
making personal investments in securities traded by the Adviser’s Clients.
Engage in personal investing that is in full compliance with the Adviser’s Code of Ethics – Employees must review and abide by
the Adviser’s personal securities transaction and insider trading policies.
Avoid taking advantage of the employee’s position – Employees must not accept investment opportunities, gifts or other gratuities
from individuals seeking to conduct business with the Adviser, or on behalf of a Client, where such opportunities, gifts or gratuities
could create the appearance of impropriety or might otherwise influence a decision to conduct business with such other party.
Maintain full compliance with the federal securities laws – It is the Adviser’s policy that all employees must abide by the standards
set forth in Rule 204A-1 (the “Code of Ethics Rule”) for registered investment advisers under the Advisers Act.
Any questions with respect to the Adviser’s Code of Ethics should be directed to the Chief Compliance Officer. As discussed in greater detail
below, employees must promptly report any violations of the Code of Ethics to the Chief Compliance Officer. All reported Code of Ethics violations
will be treated as being made on an anonymous basis.
Guiding Principles & Standards of Conduct
All employees and members of the Adviser, and consultants closely associated with the Adviser, will act with competence, dignity and
integrity, in an ethical manner, when dealing with
Clients, the public, prospects, third-party service providers and fellow employees. The following set of principles frames the professional and ethical
conduct that the Adviser expects from its employees and consultants:
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Act with integrity, competence, diligence, respect, and in an ethical manner with the public, Clients, prospective clients, employers,
employees, colleagues in the investment profession, and other participants in the global capital markets;
Place the integrity of the investment profession, the interests of Clients, and the interests of the Adviser above one’s own personal
interests;
Adhere to the fundamental standard that the employee or consultant should not take inappropriate advantage of such person’s
position;
Conduct all personal securities transactions in a manner consistent with this policy;
Use reasonable care and exercise independent professional judgment when conducting investment analysis, making investment
recommendations, taking investment actions, and engaging in other professional activities;
Practice and encourage others to practice in a professional and ethical manner that will reflect credit on such person and the
profession;
Promote the integrity of, and uphold the rules governing, capital markets; and
Comply with applicable provisions of the federal securities laws.
I. PERSONAL SECURITIES TRANSACTION POLICY
Employees may freely trade in Permitted Securities (as defined below). If an employee wishes to trade in Reportable Securities (as defined
below), such employee must obtain pre-clearance according to the Personal Securities Transaction Policy set forth below.
Permitted Securities
Government securities, certificates of deposit, commercial paper and similar money market instruments, exchange-traded funds and closed-
rd
end funds, mutual funds (e.g., open ended investment companies), variable annuities, transactions in managed accounts (e.g., accounts where a 3
party manager has full trading authority) are Permitted Securities (“Permitted Securities”) and as such, are not required to be pre-cleared by
employees under the Personal Securities Transaction Policy. Transactions in such securities are, however, subject to the 30-day recommended
holding period described below. Employees may, if eligible to do so, invest in private funds run by others (a “Third-Party Fund”) without receiving pre-
clearance, but such investment remains subject to all of the policies and procedures in this Manual including the reporting provisions contained
herein.
Reportable Securities
The Adviser will regard the following as reportable securities (“Reportable Securities”) for purposes of complying with this policy: any note,
stock, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-trust certificate,
fractional undivided interest in oil, gas, or other mineral rights, any options on reportable securities, or in general, any interest or instrument
commonly known as a security that is not a Permitted Security.
Non-Securities
Commodities (and futures and options on commodities) that are traded on a commodities exchange, including currency futures are generally
not considered securities and do not need to be reported.
Pre-Clearance Procedures
The Adviser’s employees must have written clearance for any personal securities transaction (except for any transaction involving a Permitted
Security or Third-Party Fund) before completing the transaction. Employees may request pre-clearance through the means then-propagated by
the Chief Compliance Officer of the firm, and such means may change from time to time.
If pre-clearance is granted, the pre-clearance approval is generally valid only for the trading day on which the approval is granted except that if
the approval is granted after 4 p.m. Eastern Time (e.g., New York City time), the approval extends to 4 p.m. Eastern Time (e.g., New York City time)
the following business day.
Short Term Trading; Adverse Trading
Adviser employees are encouraged to refrain from engaging in short-term (e.g., holding periods under 30 days) personal trading. Repeated
short-term trading may subject the employee to sanctions by the Adviser. Except for limited circumstances and subject to disclosure and pre-
clearance approval, Adviser employees should not execute trades opposite of positions the Adviser takes on behalf of its clients.
Beneficial Ownership
Employees are considered to have beneficial ownership of securities (“Beneficial Ownership”) if they have or share a direct or indirect
pecuniary interest in the securities. Employees have a pecuniary interest in securities if they have the ability to directly or indirectly profit from a
securities transaction.
The following are examples of indirect pecuniary interests in securities:
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Securities held by members of employees’ immediate family sharing the same household. Immediate family means any relative, spouse
or significant other, or relative of the spouse or significant other of an employee;
An employee’s interest as a general partner in securities held by a general or limited partnership; and
An employee’s interest as a manager/member in the securities held by a limited liability company.
Employees do not have an indirect pecuniary interest in securities held by entities in which they hold an equity interest unless they are a
controlling equity holder or they share investment control over the securities held by the entity.
The following circumstances constitute beneficial ownership by employees of securities held by a trust:
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Legal ownership of securities as a trustee by an employee or members of the employees’ immediate family;
Ownership of a vested beneficial interest in a trust by an employee or members of the employees’ immediate family; and
An employee’s status as a settlor of a trust, unless the consent of all of the beneficiaries is required in order for the employee to revoke
the trust.
Restricted Securities
Anytime an employee receives material non-public information (as described in Part II, below) about a company that has issued publicly
traded securities (a “Public Company”), that company will be added to the Adviser’s Restricted Securities List. Employees will be responsible for
contacting the compliance@golubcapital.com any time that they receive or intend to receive any non-public information about a Public Company.
A copy of all executed confidentiality agreements concerning a Public Company must be brought to the attention of the Chief Compliance
Officer. Once an authorized signatory for the Adviser has signed a confidentiality agreement for the purpose of receiving non-public information about
a Public Company, the company may be placed on the Restricted Securities List if the non-public information received about the Public Company is
material.
Employees are responsible for notifying the Chief Compliance Officer of any other circumstances in which they or the firm should be restricted
pursuant to this Code of Ethics.
Employees may not trade securities in a Public Company on the Restricted Securities List, including but not limited to, trading in an
Employee’s personal account or on behalf of a Client account without receiving pre-clearance from the Compliance Department. Investment
professionals should consider the fact that they will be restricted from trading the public
securities of a Public Company for which any employee has received non-public information when evaluating any potential hedging strategies for
positions. Employees may be unable to liquidate personal or Client holdings of securities that are subsequently added to the Restricted Securities
List.
Unless the Chief Compliance sets up ethical walls, all employees, whether investment professionals or non-investment professionals, will be
regarded as having access to any non-public information about a Public Company that has been received by any other employee.
The Chief Compliance Officer or the Chief Compliance Officer’s designee will periodically review each Public Company on the Restricted
Securities List to determine whether any employees remain in possession of non-public information. Additionally, a Public Company can be removed
from the Restricted List by the Chief Compliance Officer or the Chief Compliance Officer’s designee at other times if it can be determined that no
employee remains in possession of non-public information, and no employee has any intention of obtaining such information.
Investments in Private Company Securities and Initial Public Offerings
Employees may not acquire, directly or indirectly, any Beneficial Ownership in any limited offering or initial public offering (“IPO”) without first
obtaining prior approval of the Chief Compliance Officer or the Chief Compliance Officer’s designee in order to preclude any possibility of the
employee profiting improperly from such employee’s position with the Adviser. The Chief Compliance Officer or the Chief Compliance Officer’s
designee shall (1) obtain from the employee full details of the proposed transaction (including written certification that the investment opportunity did
not arise by virtue of the employee’s activities on behalf of a Client); and (2) conclude, after consultation with a portfolio manager (who has no
personal interest in the issuer of the limited offering or IPO), that no Clients have any foreseeable interest in purchasing such security. A record of
such approval and the reasons supporting those decisions shall be kept as required in the Records section of this Policy.
Reporting
In order to provide the Adviser with information to enable it to determine with reasonable assurance any indications of front-running or the
appearance of a conflict of interest with the trading by any Client account, each Adviser employee must submit a report to the Chief Compliance
Officer or the Chief Compliance Officer’s designee showing all transactions in which the person has, or by reason of such transaction acquires, any
direct or indirect Beneficial Ownership except for exempt transactions listed in the section below entitled “Exemptions from Reporting Requirements.”
Transaction Reports
Employees are required to (i) instruct their broker-dealers to send to the Adviser duplicate broker-dealer trade confirmations and account
statements which must be received by the Chief Compliance Officer, at a minimum, no later than thirty (30) days after the end of each calendar
quarter and/or (ii) complete such paperwork as is required by the Chief Compliance Officer so that such information may be provided electronically to
the firm. If an employee’s trades do not occur through a broker-dealer (e.g., purchase of a private investment fund), such transactions shall be
reported separately on the quarterly personal securities transaction report. The quarterly transaction reports shall contain at least the following
information for each transaction in a Reportable Security in which the employee had, or as a result of the transaction acquired, any direct or indirect
beneficial ownership: (a) the date of the transaction, the title, and as applicable the exchange ticker symbol or CUSIP number, the interest rate and
maturity date (if applicable), the number of shares and the principal amount of each Reportable Security involved; (b) the nature of the transaction
(e.g., purchase, sale or any other type of acquisition or disposition); (c) the price of the Reportable Security at which the transaction was effected; (d)
the name of the broker, dealer or bank with or through which the transaction was effected; and (e) the date that the report is submitted. Employees
are reminded that they must also report transactions by members of the employee’s immediate family including spouse, children and other members
of the household in accounts over which the employee has direct or indirect influence or control. If an employee has arranged to have monthly
brokerage statements delivered to the Chief Compliance Officer, directly or electronically, then quarterly transaction reports are not required.
Initial and Annual Holdings Reports
New Adviser employees will be required to report all of their personal securities holdings not later than 10 days after the commencement of
their employment. The initial holdings report must be current as of a date not more than 45 days prior to the date the person becomes an employee.
Existing employees are required to certify to the Adviser on an annual basis that the Adviser has a complete list of the Adviser’s holdings.
Each holdings report (both the initial and annual) must contain, at a minimum: (a) the title and type of security, and as applicable the exchange
ticker symbol or CUSIP number, number of shares, and principal amount of each reportable security in which the employee has any direct or indirect
beneficial ownership; (b) the name of any broker, dealer or bank with which the employee maintains an account in which any securities are held for
the employee’s direct or indirect benefit; and (c) the date the employee submits the report.
Duplicate Copies
In order to help ensure that duplicate brokerage confirmations are received for all accounts pertaining to a particular employee, such employee
must complete and send a brokerage letter to each bank, broker or dealer maintaining an account on behalf of the employee if requested by the
Chief Compliance Officer.
Exceptions from Reporting Requirement
Employees are not required to submit: (1) a transaction or initial and annual holdings report with respect to securities held in accounts over
which the access person had no direct or
indirect influence or control, or (2) a transaction report with respect to transactions effected pursuant to an automatic investment plan.
New Account Report
A report shall be completed by an employee, when applicable, to disclose the name of any new account established by the employee during
the quarter in which any securities, including Permitted Securities, were held for the direct or indirect benefit of the employee and include: (a) the
name of the broker, dealer or bank with whom the employee established the account; (b) the date the account was established; and (c) the date that
the report is submitted by the employee.
Review
The Adviser strictly forbids “front-running” Client accounts, which is a practice generally understood to be employees personally trading ahead
of Client accounts. The Chief Compliance Officer will closely monitor employees’ investment patterns to detect these abuses. The Adviser’s
members will monitor the Chief Compliance Officer’s personal securities transactions for compliance with the Personal Securities Transaction Policy.
The reason for the development of a post-transaction review process is to ensure that the Adviser has developed procedures to supervise the
activities of its access persons. The comparison of employee trades to those of Clients will identify potential conflicts of interest or the appearance of
a potential conflict.
If the Adviser discovers that an employee is personally trading contrary to the policies set forth above, the employee shall meet with the Chief
Compliance Officer and the Adviser’s members to review the facts surrounding the transactions. This meeting shall help the Adviser to determine the
appropriate course of action.
Remedial Actions
The Adviser takes the potential for conflicts of interest caused by personal investing very seriously. Employees should be aware that the
Adviser reserves the right to impose varied sanctions on policy violators depending on the severity of the policy violation, including termination of
employment.
II. POLICIES AND PROCEDURES TO DETECT AND PREVENT INSIDER TRADING
The Adviser’s business may require employees to deal with confidential information. The proper handling of material, non-public information is
critical to the Adviser’s integrity. The Adviser’s reputation is a vital asset and even the appearance of the misuse of material, non-public information
should be avoided. The misuse of non-public information may violate federal and state securities laws and other legal and regulatory requirements.
Violations may be damaging to both the reputation and financial position of the Adviser and its employees.
The Adviser forbids trading, either for oneself or for others, on material, non-public information or communicating material, non-public
information to others in violation of the law. This conduct is frequently called “insider trading.” The Adviser’s policy extends to activities within and
outside one’s relationship with the Adviser. Individuals who cease to work for the Adviser must continue to maintain the confidentiality of inside and
proprietary information learned during their employment.
Although “insider trading” is not defined in securities laws, it is generally thought to be described as trading either personally or on behalf of
others on the basis of material non-public information or communicating material non-public information to others in violation of the law.
In the past, securities laws have been interpreted to prohibit the following activities:
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Trading by an insider while in possession of material non-public information;
Trading by a non-insider while in possession of material non-public information, where the information was disclosed to the non-insider
in violation of an insider’s duty to keep it confidential; or
Communicating material non-public information to others in breach of a fiduciary duty.
Whom Does the Policy Cover?
This policy covers all of the Adviser’s employees (“covered persons”) as well as any transactions in any securities participated in by family
members, trusts or corporations directly or indirectly controlled by such persons. In addition, the policy applies to transactions engaged in by
corporations in which the covered person is an officer, director or 10% or greater stockholder and a partnership of which the covered person is a
partner unless the covered person has no direct or indirect control over the partnership. If any employee has questions about whom this policy
covers, such employee should consult the Chief Compliance Officer.
What Information is Material?
Information is “material” when there is a substantial likelihood that a reasonable investor would consider it important in making investment
decisions. Generally, this is information whose disclosure will have a substantial effect on the price of a company’s securities. No simple “bright line”
test exists to determine whether information is material; assessments of materiality involve highly fact specific inquiries. Adviser employees should
direct any questions regarding the materiality of information to the Chief Compliance Officer. The following is an illustrative list of the type of
information that is generally regarded as “material”:
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Information relating to a company’s results and operations
Dividend or earnings announcements
Write-downs or write-offs of assets
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Additions to reserves for bad debts or contingent liabilities
Expansion or curtailment of company or major division operations
Merger, joint venture announcements
New product/service announcements
Discovery or research developments
Criminal, civil and government investigations and indictments
Pending labor disputes
Debt service or liquidity problems
Bankruptcy or insolvency problems
Tender offers, stock repurchase plans, etc.
Recapitalization
Information provided by a company could be material because of its expected effect on a particular class of a company’s securities, all of the
company’s securities, the securities of another company, or the securities of several companies. The misuse of material non-public information
applies to all types of securities, including equity, debt, commercial paper, government securities and options.
Material information does not have to relate to a company’s business. For example, material information about the contents of an upcoming
newspaper column may affect the price of a security and therefore be considered material. Material information may also relate to the market for a
security. Information about a significant order to purchase or sell securities, in some contexts, may be deemed material; similarly, prepublication
information regarding reports in the financial press may also be deemed material.
What Information is Non-Public?
In order for issues concerning insider trading to arise, information must not only be material, but also non-public. “Non-public” information
generally means information that has not been available to the investing public.
Once material, non-public information has been effectively distributed to the investing public, it is no longer classified as material, non-public
information. However, the distribution of non-public information must occur through commonly recognized channels for the classification to change.
In addition, the information must not only be publicly disclosed, there must be adequate time for the public to receive and digest the information.
Lastly, non-public information does not change to public information solely by selective dissemination.
The Adviser’s employees must be aware that even where there is no expectation of confidentiality, a person may become an insider upon
receiving material, non-public information. Whether the “tip” made to the employee makes such employee a “tippee” depends on whether the
corporate insider expects to benefit personally, either directly or indirectly, from the disclosure.
The “benefit” is not limited to a present or future monetary gain; it could be a reputational benefit or an expectation of a quid pro quo from the
recipient by a gift of the information. Employees may also become insiders or tippees if they obtain material, non-public information by happenstance,
at social gatherings, by overhearing conversations, etc.
Penalties for Trading on Insider Information
Severe penalties exist for firms and individuals that engage in the act of insider trading, including civil injunctions, treble damages,
disgorgement of profits and jail sentences. Further, fines for individuals and firms found guilty of insider trading are levied in amounts up to three
times the profit gained or loss avoided, and up to the greater of $1,000,000 or three times the profit gained or loss avoided, respectively.
Procedures to Follow if an Employee Believes That Such Employee Possesses Material, Non-Public Information
The Adviser has established the following procedures to help each employee avoid insider trading and to aid the Adviser in preventing,
detecting and imposing sanctions against insider trading. Each employee must follow these procedures or risk serious sanctions, including dismissal,
substantial personal liability and criminal penalties. If any employee has questions about these procedures, such employee should consult the Chief
Compliance Officer.
If an employee has questions as to whether such employee is in possession of material, non-public information, the employee must inform the
Chief Compliance Officer as soon as possible. From this point, the employee, the Chief Compliance Officer and the Adviser’s members will conduct
research to determine if the information is likely to be considered important to investors in making investment decisions and whether the information
has been publicly disseminated.
Given the severe penalties imposed on individuals and firms engaging in insider trading, an Adviser employee:
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shall not trade the securities of any company in which such employee is deemed an insider who may possess material, non-public
information about the company;
shall not trade the securities of any company except in accordance with the Adviser’s Personal Securities Transaction Policy and the
securities laws;
shall submit personal security trading reports in accordance with the Personal Security Transaction Policy;
shall not discuss any potentially material, non-public information with colleagues, except as specifically required by such employee’s
position;
shall immediately report the potential receipt of non-public information to the Chief Compliance Officer and the Adviser’s members; and
shall not proceed with any research, trading or other investment advisory activities until the Chief Compliance Officer and the Adviser’s
members inform the employee of the appropriate course of action.
III. DIRECTORSHIPS; OUTSIDE BUSINESS ACTIVITIES
Serving as Officers, Trustees and/or Directors of Outside Organizations
Employees may, under certain circumstances, be granted permission to serve as directors, trustees or officers of outside organizations. These
organizations can include public or private corporations, partnerships, charitable foundations and other not-for-profit institutions. Employees may also
receive compensation for such activities.
At certain times, the Adviser may determine that it is in its Clients’ best interests for an employee to serve as an officer or on the board of
directors of outside organizations. For example, a company held in Clients’ portfolios may be undergoing a reorganization that may affect the value of
the company’s outstanding securities and the future direction of the company. Service with organizations outside of the Adviser can, however, raise
serious regulatory issues and concerns, including conflicts of interests and access to material non-public information.
As an outside board member or officer, an employee may come into possession of material non-public information about the outside company
or other public companies. It is critical that a proper information barrier be in place between the Adviser and the outside organization and that the
employee not communicate such information to other Adviser employees in violation of the information barrier.
Similarly, the Adviser may have a business relationship with the outside organization or may seek a relationship in the future. In those
circumstances, the employee should not be involved in the decision to retain or hire the Adviser.
Adviser employees are prohibited from engaging in such outside activities without the prior written approval from the Chief Compliance
Officer. Approval will be granted on a case-by-case basis, subject to proper resolution of potential conflicts of interest. Outside activities will be
approved only if any conflict of interest issues can be satisfactorily resolved.
Outside Business Activities
Adviser personnel generally may not be employed (either on a part-time, evening or weekend basis) or compensated by any business other
than the Adviser or one of its affiliates.
Approval of the Chief Compliance Officer for any of the above activities must be obtained prior to engaging in such activity so that
determinations may be made regarding (1) the degree to which such activity may interfere with the employee’s duties to the Adviser and the Clients
and (2) whether such activity involves conflicts of interest between the Adviser and any Client that need to be disclosed and may require Client
and/or Fund Investor consent.
IV. RUMORS; MANIPULATIVE TRADING PRACTICES
A.
Rumors
Supervised Persons are prohibited from circulating false rumors and rumors of a sensational character that reasonably may be
expected to affect market conditions for one or more securities, sectors or markets, or improperly influencing any person or entity. Intentionally
creating, passing or using false rumors may violate the antifraud provisions of federal securities laws, and such conduct is contradictory to this Code
of Ethics and the Adviser’s expectations regarding appropriate behavior of its Supervised Persons.
A Supervised Person should consult with the Chief Compliance Officer if such Supervised Person has questions regarding the
appropriateness of any communications.
B. Manipulative Trading Practices
Section 9(a)(2) of the Exchange Act and Rule 10b-5 thereunder make it unlawful for any person, acting alone or with others, to trade
any security in order to create actual or apparent active trading in such security, or raise or depress the price of the security.
Supervised Persons are prohibited from engaging in actual or apparent trading in a security for the purpose of (a) inducing the
purchase or sale of such security by others; or (b) causing the price of a security to move up or down. The Exchange Act does not prohibit otherwise
lawful activity that has the incidental result of changing the supply or demand or the intrinsic value of a security.
V. POLITICAL CONTRIBUTION POLICY
Pay-to-play is the practice of making campaign contributions and related payments to elected officials in order to influence the awarding of
lucrative contracts for the management of public pension plan assets and similar government investment accounts. The SEC has adopted measures
to curtail pay-to-play practices by registered investment advisers. The Adviser prohibits any Supervised Person from making a political contribution to
gain, or to attempt to gain, an engagement for the Adviser or any affiliate.
The Adviser also prohibits any Supervised Person from making any political contributions without prior written approval as outlined
in the policy statement below:
This policy statement is necessary to comply with laws, regulations and governmental policies relating to political contributions to public
officials and candidates by investment managers, their employees and certain related parties described below, or relating to their solicitation
or coordination of political contributions. For this purpose, a “political contribution” includes any gift, loan, deposit, transition or inaugural
expense, or anything of value other than unpaid volunteer time, or any indirect contributions directed, funded or solicited through third parties.
This policy statement covers any owner, director, officer, employee or agent of Golub Capital, any of their household members, or any
political action committee or other entity that they control. It prohibits any such person or entity covered by this policy statement from making a
contribution to anyone who is, or who is campaigning to become, a state, local or public retirement plan official, without first notifying Golub
Capital and receiving prior approval from Compliance. A candidate for federal office that is currently a state, local or retirement plan official
would be subject to this restriction. Prior notice and approval are also required prior to the solicitation or coordination of political contributions
for anyone who is, or who is campaigning to become, a state, local or public retirement plan official, or for state or local political parties.
The purpose of this policy statement is not to unnecessarily limit political contributions and activities, but to comply with applicable laws,
regulations and
governmental policies applicable to Golub Capital, including changes that might occur in the law. Therefore, Golub Capital will normally
approve political contributions and activities that comply with applicable laws, regulations and governmental policies, do not impose a material
risk to Golub Capital in light of possible changes that might occur and do not otherwise impose a material risk to the business or reputation of
Golub Capital. For example, under current rules, Golub Capital will normally approve contributions outside the State of New York by persons
who are not in management or fundraising roles or who make contributions under certain dollar thresholds. Golub Capital also will normally
approve contributions in the State of New York under certain dollar thresholds by persons entitled to vote for the office involved. Similarly,
Golub Capital will normally approve contributions involving governmental offices that are not involved in the management of assets or the
selection of investment managers, and that are not in a position to appoint or otherwise influence such officials. In all events, however, Golub
Capital may be required to keep records of contributions and solicitation and coordination activities of persons and entities covered by this
policy statement, and to disclose those records to its governmental regulators.
This policy statement may change as laws, regulations and governmental policies change. This policy statement is in addition to, and
does not replace, other policies of Golub Capital with respect to complying with laws and maintaining the highest level of integrity concerning
Golub Capital’s dealings with its Investors, including but not limited to Investors that represent state, municipal and retirement plan assets.
VI. PROVIDING INVESTMENT ADVICE TO PERSONS OTHER THAN ADVISER CLIENTS; DISCLOSURE OF PERSONAL INTEREST IN
TRANSACTIONS
To avoid conflicts with the interests of Clients, no Supervised Person may provide investment advice (e.g., advice as to the value of securities,
or as to the advisability of investing in, purchasing or selling securities) or portfolio management services for compensation to any person, other than
a Client, under any circumstances, unless that arrangement is disclosed to and approved by the Chief Compliance Officer. Such investment advice
would be considered an “outside business activity” and should be reported as such. It is a conflict of interest to recommend any security to a Client,
or to direct any transaction for a Client in that security, if a Supervised Person has a personal interest in that security. Therefore, if a Supervised
Person has a personal interest in a security (other than an interest in a Fund), such Supervised Person must disclose that interest to the Chief
Compliance Officer before recommending that security or before directing an investment decision with respect to that security. If a Supervised
Person has the power to direct any transaction in any such security, investment personnel with no personal interest in such security must review
such an investment decision. A personal interest in a security may be financial, but it may also involve another interest, such as a family or friend’s
involvement with a security. This shall not, however, prohibit a Supervised Person from making investment decisions for such Supervised Person’s
own account, subject to the Code of Ethics.
VII. GIFTS
Receiving Excessive Gifts or Entertainment is Prohibited
Receiving excessive gifts or entertainment from others who may represent actual or potential vendors is prohibited. Supervised Persons may
accept only business-related meals, entertainment, gifts, or favors when the value involved is not significant and clearly will not create any
appearance of a conflict of interest or an obligation to the donor. The value of a gift or favor should be less than $100 and may not be part of a
recurrent pattern of giving. Each Supervised Person may accept gifts from a single giver (any firm or natural person associated with such firm) in
amounts not exceeding $100 in any year. Such prohibition does not limit ordinary and usual business entertainment provided by a firm or its
associates to Supervised Persons. Thus, when a firm or its associates are hosting Supervised Persons at an occasional meal, sporting event, theater
production or comparable entertainment event, such an event would not be subject to the $100 gift restriction so long as it is neither so frequent nor
so extensive as to raise any question of propriety.
Approval Required for Receipt of Gifts in Excess of $100
Before accepting anything with an assumed individual or aggregate value (except for those items of business entertainment noted directly
above) from any outside business person in excess of $100 during any year, a Supervised Person must obtain the written approval of the Chief
Compliance Officer.
Providing Excessive Gifts or Entertainment is Prohibited
Providing excessive gifts or entertainment to others who may represent actual or prospective clients is also prohibited. Giving extravagant
gifts or entertainment to the fiduciary of an account can be construed as an inducement to such fiduciary to allocate client assets on a basis other
than the suitability of the manager. Further, the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and many state laws (with
respect to state plans) prohibit such gifts.
In any case, no gifts or entertainment of any value should be given with respect to any ERISA or Taft-Hartley benefit plan investor, state or
municipal pension plans or state or local elected officials without prior approval of the Chief Compliance Officer.
Supervised Persons may give only business-related meals, entertainment, gifts or favors when the value involved is not significant and clearly
will not create any appearance of a conflict of interest or an obligation to the donor. The value of a gift or favor should be less than $250 and may not
be part of a recurrent pattern of giving. Each Supervised Person may give gifts to a single receiver (any firm or natural person associated with such
firm) in amounts not exceeding $250 in any year. Such prohibition does not limit ordinary and usual business entertainment provided to a firm or its
associates. Thus, when a firm or its associates are hosted by Supervised Persons at an occasional meal, sporting event, theater production or
comparable entertainment event, such an event would not be subject to the $250 gift restriction so long as it is neither so frequent nor so extensive
as to raise any question of propriety.
Approval Required for Providing Gifts in Excess of $250
Before giving anything with an assumed individual or aggregate value (except for those items of business entertainment noted directly above)
to any outside business person in excess of $250 during any year, a Supervised Person must obtain the approval of the Chief Compliance Officer.
Under no circumstances may an employee initiate or encourage the provision of a gift from any other person or organization. For the
avoidance of doubt, this policy regarding gifts also applies to interactions with government entities and employees.
Relationships with Outside Vendors
Supervised Persons should be careful when doing business on behalf of the Adviser with outside vendors (“Vendors”) with which a
Supervised Person has a financial interest or family or personal relationship. These situations may present conflicts of interest that impair the
Supervised Person from acting solely in the best interests of the Adviser and its Clients and without regard to the financial interest or family or
personal relationship. When a Supervised Person learns that the Adviser is, or is considering, doing business with a Vendor with which that or
another employee has a financial, family or personal relationship, the Supervised Person should disclose that information promptly to the Chief
Compliance Officer. While there is no absolute prohibition against holding a financial interest in or having a family or personal relationship with a
Vendor, the Adviser will examine these situations, before the relationship with the Adviser begins to the extent practicable, so that the Adviser can
evaluate any potential conflicts of interest.
In evaluating these situations, a conflict of interest will be presumed to exist when an employee who has a financial, family or personal
relationship with a Vendor approves the use of the Vendor or negotiates the terms of the agreement with the Vendor. Certain mitigating facts can
overcome this presumption. Factors that will be considered include the significance of the financial interest, the degree of the family or personal
relationship and whether the fairness of the price of the goods or services can be determined independently.
VIII. DISCLOSURE OF CONFLICTS OF INTEREST
Any Supervised Person who becomes aware of any practice that arguably involves the Adviser in a conflict of interest and is not sure
whether the practice has been fully and accurately disclosed to Clients and/or Investors or whether Clients and/or Investors have
consented to the practice should promptly contact the Chief Compliance Officer. In assisting the Chief Compliance Officer in formulating
appropriate disclosures, Supervised Persons must bear in mind that the Adviser will not be deemed to have properly obtained consent from a
particular Client or Investor unless the disclosure relating to the conflict is materially accurate and complete and understandable by that particular
Client or Investor.
SUBSIDIARIES OF GOLUB CAPITAL BDC, INC.
EXHIBIT 21.1
Name
Golub Capital BDC CLO III LLC
Golub Capital BDC CLO III Depositor LLC
Golub Capital BDC CLO 2014 LLC
Golub Capital BDC Holdings, LLC
GBDC Quick Quack Coinvest LLC
GBDC Holdings Coinvest, Inc.
GBDC Holdings ED Coinvest, Inc.
GCIC Holdings LLC
GCIC Quick Quack Coinvest LLC
GCIC CLO II LLC
GCIC CLO II Depositor LLC
GCIC North Haven Stack Buyer Coinvest, Inc.
GCIC Funding LLC
Jurisdiction
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Consent of Independent Registered Public Accounting Firm
EXHIBIT 23.1
We consent to the incorporation by reference of our reports dated November 20, 2023, with respect to the consolidated financial statements of Golub Capital BDC, Inc. and
Subsidiaries and the effectiveness of internal control over financial reporting of Golub Capital BDC, Inc. and Subsidiaries included in this Annual Report (Form 10-K) for the year ended
September 30, 2023, into the Registration Statement (Form N-2, File No. 333-265509), filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Chicago, Illinois
November 20, 2023
Certification of Chief Executive Officer
of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d-14(a)
Exhibit 31.1
I, David B. Golub, Chief Executive Officer, certify that:
1) I have reviewed this Annual Report on Form 10-K of Golub Capital BDC, Inc.;
2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this report;
4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15 (e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is
being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s
fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the
audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: November 20, 2023
/s/ David B. Golub
David B. Golub
Chief Executive Officer
(Principal Executive Officer)
Certification of Chief Financial Officer
of Periodic Report Pursuant to Rule 13a-14(a) and Rule 15d-14(a)
Exhibit 31.2
I, Christopher C. Ericson, Chief Financial Officer, certify that:
1) I have reviewed this Annual Report on Form 10-K of Golub Capital BDC, Inc.;
2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of
the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this report;
4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15 (e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is
being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s
fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the
audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
Date: November 20, 2023
/s/ Christopher C. Ericson
Christopher C. Ericson
Chief Financial Officer
(Principal Financial Officer)
CERTIFICATION PURSUANT TO
18 U.S.C SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.1
In connection with the Annual Report on Form 10-K of Golub Capital BDC, Inc. (the “Company”), for the annual period ended September 30, 2023, as filed with the Securities and
Exchange Commission on the date hereof (the “Report”), we, David B. Golub and Christopher C. Ericson, Chief Executive Officer and Chief Financial Officer, respectively, of the
Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to our knowledge:
(1)
(2)
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange
Act of 1934; and
The information contained in the Report fairly presents, in all material respects, the financial condition
and results of operations of the Company.
Date: November 20, 2023
/s/ David B. Golub
David B. Golub
Chief Executive Officer
/s/ Christopher C. Ericson
Christopher C. Ericson
Chief Financial Officer
BUSINESS.30319083.2 Exhibit 97.1 GOLUB CAPITAL BDC, INC. CLAWBACK POLICY The Board of Directors (the “Board”) of Golub Capital BDC, Inc., a Delaware corporation (the “Company”), believes that it is in the best interests of the Company and its stockholders to adopt this Clawback Policy (this “Policy”), which provides for the recovery of Incentive-Based Compensation received by Covered Executives, if any, in the event of an Accounting Restatement (as such terms are defined below). The Company, as an externally-managed business development company regulated under the Investment Company Act of 1940, as amended (the “1940 Act”), currently neither pays nor has any plans to pay or otherwise award Incentive-Based Compensation to Covered Executives, but nevertheless has designed and implemented this Policy to comply with Section 10D of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), Rule 10D-1 promulgated under the Exchange Act (“Rule 10D-1”) and Listing Rule 5608 of the Nasdaq Stock Market LLC Rules (the “Listing Rules”). Rule 10D-1 and the Listing Rules require the Company to adopt this Policy regardless of whether Incentive-Based Compensation is paid or otherwise awarded by the Company to Covered Executives. This Policy shall be interpreted in a manner consistent with Rule 10D-1 and the Listing Rules. 1. Administration Except as specifically set forth herein, this Policy shall be administered by the Board or, if designated by the Board, a committee thereof (the Board or such committee charged with administration of this Policy, the “Administrator”). The Administrator is authorized to interpret and construe this Policy and to make all determinations necessary, appropriate or advisable for the administration of this Policy. Any determinations made by the Administrator shall be final and binding on all affected individuals and need not be uniform with respect to each individual covered by this Policy. In the administration of this Policy, the Administrator is authorized and directed to consult with the full Board or such other committees of the Board, such as the Audit Committee or the Compensation Committee, as applicable, as may be necessary or appropriate as to matters within the scope of such committee’s responsibility and authority. Subject to any limitation of applicable law, the Administrator may authorize and empower any one or more officers
of the Company to take any and all actions necessary or appropriate to carry out the purpose and intent of this Policy (other than with respect to any recovery under this Policy involving any such officer(s)). 2. Definitions As used in this Policy, the following definitions shall apply: a. “Accounting Restatement” means an accounting restatement of the Company’s financial statements due to the Company’s material noncompliance with any financial reporting requirement under the securities laws of the United States of America, including any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements, or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period. b. “Administrator” has the meaning set forth in Section 1 hereof. c. “Applicable Period” means the three completed fiscal years immediately preceding the date on which the Company is required to prepare an Accounting Restatement, as well as any transition period (that results from a change in the Company’s fiscal year) within or immediately following
2 those three completed fiscal years (except that a transition period between the last day of the Company’s previous fiscal year end and the first day of its new fiscal year that comprises a period of nine to 12 months shall be deemed to be a completed fiscal year). The “date on which the Company is required to prepare an Accounting Restatement” is the earlier to occur of (a) the date the Board, a committee of the Board, or the officer or officers of the Company authorized to take such action if action by the Board or a committee thereof is not required, concludes, or reasonably should have concluded, that the Company is required to prepare an Accounting Restatement or (b) the date a court, regulator or other legally authorized body directs the Company to prepare an Accounting Restatement, in each case regardless of if or when the restated financial statements are filed. d. “Covered Executives” means any current or former executive officer of the Company, including the Company’s president, principal financial officer, principal accounting officer (or if there is no such accounting officer, the controller), any vice-president of the Company in charge of a principal business unit, division, or function (such as sales, administration, or finance), any other officer of the Company who performs a policy-making function, or any other person who performs similar policy-making functions for the Company, and any officer within the meaning of 17 C.F.R. 229.401(b). An executive officer of a parent or subsidiary of the Company is deemed a Covered Executive if the executive officer performs policy making functions for the Company. “Policy making function” for purposes of this definition is not intended to include policy making functions that are not significant to the Company. The definition of Covered Executives shall be interpreted in accordance with the definition of “Executive Officer” set forth in Rule 10D-1 and the Listing Rules. For the avoidance of doubt, “Covered Executives” does not include the Company’s investment adviser (the “Adviser”) or any of the Adviser’s directors, partners, officers or employees, solely in their capacity as such. e. “Erroneously Awarded Compensation” has the meaning set forth in Section 6 of this Policy. f. “Financial Reporting Measure” means any measure that is determined and presented in accordance with the accounting principles used in preparing the Company’s financial
statements, and any measure that is derived wholly or in part from such measure. For the avoidance of doubt, Financial Reporting Measures include but are not limited to the following (and any measure derived from the following): Company stock price; total stockholder return (“TSR”); net asset value; net investment income; net income; net realized or unrealized gains; profitability; financial ratios; earnings before interest, taxes depreciation and amortization; funds from operations and adjusted funds from operations; liquidity measures; return measures (e.g., return on investments; return on assets); earnings measures (e.g., earnings per share); and any of such financial reporting measures relative to a peer group, where the Company’s financial reporting measure is subject to an Accounting Restatement. A Financial Reporting Measure need not be presented within the Company’s financial statements or included in a filing with the Securities and Exchange Commission. g. “Incentive-Based Compensation” means any compensation that is granted by the Company or earned and/or vested based wholly or in part upon the attainment of a Financial Reporting Measure. For purposes of this Policy, Incentive-Based Compensation is deemed “received” in the Company’s fiscal period during which the Financial Reporting Measure specified in the Incentive-Based Compensation award is attained, even if the payment or grant of such Incentive-Based Compensation occurs after the end of that period.
3 3. Scope; Covered Executives; Incentive-Based Compensation The Company currently neither pays nor has any plans to pay or otherwise award Incentive-Based Compensation to Covered Executives.1 4. Board Review This Policy will be presented to the Board for review and approval at such times as the Board in its discretion determines is necessary and appropriate. The Board may amend, modify, supplement, rescind or replace all or any portion of this Policy at any time and from time to time in its discretion, and shall amend this Policy as it deems necessary to comply with applicable law or any rules or standards adopted by a national securities exchange on which the Company’s securities are listed. 5. Required Recovery of Erroneously Awarded Compensation in the Event of an Accounting Restatement In the event that the Company is required to prepare an Accounting Restatement, the Company shall recover, on a reasonably prompt basis, the amount of any Erroneously Awarded Compensation received by any Covered Executive from the Company, as calculated pursuant to Section 6 of this Policy, during the Applicable Period. Recovery under this Policy with respect to a Covered Executive shall not require the finding of any misconduct by such Covered Executive or such Covered Executive being found responsible for the accounting error leading to an Accounting Restatement. 6. Erroneously Awarded Compensation: Amount Subject to Recovery The amount of “Erroneously Awarded Compensation” subject to recovery under this Policy, as determined by the Administrator, is the amount of Incentive-Based Compensation received by the Covered Executive that exceeds the amount of Incentive-Based Compensation that otherwise would have been received by the Covered Executive had it been determined based on the applicable restated Financial Reporting Measure. Erroneously Awarded Compensation shall be computed without regard to any taxes paid by the Covered Executive in respect of the Erroneously Awarded Compensation. With respect to any compensation plans or programs that take into account Incentive-Based Compensation, the amount of Erroneously Awarded Compensation subject to recovery hereunder includes, but is not limited to, the amount contributed to any notional account based on Erroneously Awarded Compensation and any earnings
accrued to date on that notional amount. For Incentive-Based Compensation based on the Company’s stock price or TSR: (a) the Administrator shall determine the amount of Erroneously Awarded Compensation based on a reasonable estimate of the effect of the Accounting Restatement on the stock price or TSR upon which the Incentive-Based Compensation was received; and (b) the Company shall maintain documentation of the determination of that reasonable estimate and provide such documentation to the Nasdaq Stock Market LLC (the “Nasdaq”). 1 This Policy applies to Incentive-Based Compensation received by a person (a) after beginning services as a Covered Executive; (b) if that person served as a Covered Executive at any time during the performance period for such Incentive-Based Compensation; (c) while the Company had a listed class of securities on a national securities exchange; and (d) during the Applicable Period.
4 7. Method of Recovery The Administrator shall determine, in its sole discretion, the timing and method for promptly recovering Erroneously Awarded Compensation hereunder, which may include without limitation (a) seeking reimbursement of all or part of any cash or equity-based award, (b) cancelling prior cash or equity-based awards, whether vested or unvested or paid or unpaid, (c) cancelling or offsetting against any planned future cash or equity-based awards, (d) forfeiture of deferred compensation, subject to compliance with Section 409A of the Internal Revenue Code and the regulations promulgated thereunder and (e) any other method authorized by applicable law or contract. Subject to compliance with any applicable law, the Administrator may effect recovery under this Policy from any amount otherwise payable to the Covered Executive, including amounts payable to such individual under any otherwise applicable Company plan or program, including base salary, bonuses, other compensation, and/or compensation previously deferred by the Covered Executive. The Company is authorized and directed pursuant to this Policy to recover Erroneously Awarded Compensation on a reasonably prompt basis in compliance with this Policy unless the Board (including a majority of its directors who are not “interested persons” of the Company, as defined in Section 2(a)(19) of the 1940 Act) or applicable committee thereof has determined that such recovery would be impracticable for one of the following reasons, and subject to the following procedural and disclosure requirements: a. The direct expense paid to a third party to assist in enforcing this Policy would exceed the amount to be recovered. Before concluding that it would be impracticable to recover any amount of Erroneously Awarded Compensation based on the expense of enforcement, the Company must make, or cause to be made, a reasonable attempt to recover such Erroneously Awarded Compensation, document such reasonable attempt(s) to recover and provide that documentation to the Nasdaq; b. Recovery would violate home country law where that law was adopted prior to November 28, 2022. Before concluding that it would be impracticable to recover any amount of Erroneously Awarded Compensation based on violation of home country law, the Company must obtain an opinion of home country counsel, acceptable to the
Nasdaq, that recovery would result in such a violation and must provide such opinion to the Nasdaq; or c. Recovery would likely cause an otherwise tax-qualified retirement plan, under which benefits are broadly available to employees of the Company, if any, to fail to meet the requirements of 26 U.S.C. 401(a)(13) or 26 U.S.C. 411(a) and regulations thereunder. 8. No Indemnification of Covered Executives Notwithstanding the terms of any indemnification or insurance policy or any contractual arrangement with any Covered Executive that may be interpreted to the contrary, the Company shall not indemnify any Covered Executives against losses caused by the recovery of any Erroneously Awarded Compensation. In addition, the Company is not permitted to pay or reimburse a Covered Executive for premiums on an insurance policy purchased by such Covered Executive to protect them from such recovery. Other than as expressly stated herein, this Policy does not otherwise limit a Covered Executive’s insurance coverage (including any insurance coverage acquired by the Company) or a Covered Executive’s right to indemnification from the Company, including in each case, for actions related to any Accounting Restatement.
5 9. Administrator Indemnification Any directors and officers of the Company, and any other personnel who assist in the administration of this Policy including but not limited to employees of the Adviser and of the Company’s administrator, shall not be personally liable for any action, determination or interpretation made with respect to this Policy and shall be fully indemnified by the Company to the fullest extent under applicable law and Company policy with respect to any such action, determination or interpretation. The foregoing sentence shall not limit any other rights to indemnification of the members of the Board under applicable law or Company policy. 10. Effective Date; Retroactive Application This Policy shall be effective as of the effective date of the Listing Rules (the “Effective Date”). The terms of this Policy shall apply to any Incentive-Based Compensation that is received by Covered Executives from the Company on or after the Effective Date, even if such Incentive-Based Compensation was approved, awarded, granted or paid to Covered Executives prior to the Effective Date. Without limiting the generality of Section 7 of this Policy, and subject to applicable law, the Administrator may affect recovery under this Policy from any amount of compensation approved, awarded, granted, payable or paid to the Covered Executive prior to, on or after the Effective Date. 11. Other Recovery Rights; Company Claims Any right of recovery under this Policy is in addition to, and not in lieu of, any other remedies or rights of recovery that may be available to the Company under applicable law or pursuant to the terms of any similar policy in any employment agreement, equity award agreement, or similar agreement and any other legal remedies available to the Company. Nothing contained in this Policy limits any claims, damages or other legal remedies the Company or any of its affiliates may have against a Covered Executive arising out of resulting from any actions or omissions by the Covered Executive. 13. Exhibit Filing Requirement A copy of this Policy, including any amendments thereto, shall be filed as an exhibit to the Company’s annual report on Form 10-K to the extent required by applicable law. Adopted: November 17, 2023
EXHIBIT 99.1
GOLUB CAPITAL BDC, INC.
(THE “COMPANY”)
INVESTOR PRIVACY NOTICE
Maintaining the confidentiality of the personal information of our current and prospective investors is one of our highest priorities. This notice sets
forth the type of personal information we collect, how that information is used by us, and how we protect your personal information.
In this Investor Privacy Notice, “we”, “us” and “our” refers to the Company and GC Advisors LLC and its or their affiliates or delegates
HOW AND WHY WE COLLECT PERSONAL INFORMATION
1. Collection.
Personal information may be collected from investors in order to comply with legal and regulatory requirements. Information may be collected from
any of the following sources:
a. From You: We collect information from investors when they enter into a subscription agreement with the Company. We may also collect
information from investor questionnaires, W-9’s and other applications or forms that investors complete. This information may include items
such as an investor’s name, address, e-mail address, social security number, birth date, annual income, net worth, marital status, and
investment risk tolerance. If an investor indicates he or she has a spouse or partner, his/her personal and financial account information may
also be requested. In order to establish the legitimacy of the subscribing entity, as well as capacity and authority of controlling person(s), we
may request copies of organizational documents.
b. From Transactions: If an investor invests in the Company, we keep records relating to the investor’s interest in the Company.
c. From our Website: If investors visit GC Advisors’ website, we may collect the contact details and other information that investors provide
directly to us and we may track the amount of time each investor spends on our site, the parts of our site visited and other technical
information. We use this information to improve the functionality of our website.
2. Use of Personal Information
Investors’ personal information is collected and maintained by us so that we may fulfill our legal and regulatory requirements.
DISCLOSURE OF PERSONAL INFORMATION
We do not, and do not intend, to sell or disclose personal information about current or former investors to nonaffiliated third parties except as set forth
below. If in the future this policy
changes investors will be notified and provided with an opportunity to opt out of such disclosure. We may share personal information of investors as
follows:
a. We will reveal or share personal information where the law permits or requires it, such as for tax reporting purposes or pursuant to a court
order, or to otherwise comply with applicable laws and regulations.
b. We may reveal or share personal information with our affiliates. Our affiliates include, for example, investment funds that are manage or over
which GC Advisors or its affiliates have control.
c. We may reveal or share personal information with unaffiliated service providers such as brokers, fund administrators and transfer agents in
connection with distributions or other transactions. An investor’s personal information may also be provided to attorneys, accountants or
auditors in order to enable us to comply with legal and regulatory requirements.
PROTECTION OF YOUR PERSONAL INFORMATION
Our employees may, from time to time, have access to the personal information of investors in order to provide services to investors. All employees
are subject to the terms of certain privacy policies and practices. We also maintain physical, electronic and procedural safeguards designed to
protect nonpublic personal financial information.