Barings BDC, Inc.

Previous wording

The following discussion is designed to provide a better understanding of our Unaudited Consolidated Financial Statements for the three and nine months ended September 30, 2025, including a brief discussion of our business, key factors that impacted our performance and a summary of our operating results. The following discussion should be read in conjunction with the Unaudited Consolidated Financial Statements and the notes thereto included in Item 1 of this Quarterly Report on Form 10-Q, and the Consolidated Financial Statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2024. Historical results and percentage relationships among any amounts in the financial statements are not necessarily indicative of trends in operating results for any future periods.

Current wording

The following discussion is designed to provide a better understanding of our Unaudited Consolidated Financial Statements for the three months ended March 31, 2026, including a brief discussion of our business, key factors that impacted our performance and a summary of our operating results. The following discussion should be read in conjunction with the Unaudited Consolidated Financial Statements and the notes thereto included in Item 1 of this Quarterly Report on Form 10-Q, and the Consolidated Financial Statements and notes thereto and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended December 31, 2025. Historical results and percentage relationships among any amounts in the financial statements are not necessarily indicative of trends in operating results for any future periods.

Previous wording

Some of the statements in this Quarterly Report constitute forward-looking statements because they relate to future events or our future performance or financial condition. Forward-looking statements may include, among other things, statements as to our future operating results, our business prospects and the prospects of our portfolio companies, the impact of the investments that we expect to make, the ability of our portfolio companies to achieve their objectives, our expected financings and investments, the adequacy of our cash resources and working capital, and the timing of cash flows, if any, from the operations of our portfolio companies. Words such as “expect,” “anticipate,” “target,” “goals,” “project,” “intend,” “plan,” “believe,” “seek,” “estimate,” “continue,” “forecast,” “may,” “should,” “potential,” variations of such words, and similar expressions indicate a forward-looking statement, although not all forward-looking statements include these words. Readers are cautioned that the forward-looking statements contained in this Quarterly Report are only predictions, are not guarantees of future performance, and are subject to risks, events, uncertainties and assumptions that are difficult to predict. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason, including the items discussed herein, in Item 1A titled “Risk Factors” in Part I of our Annual Report on Form 10-K for the year ended December 31, 2024 and in Item 1A titled “Risk Factors” in Part II of our subsequently filed Quarterly Reports on Form 10-Q or in other reports that we may file with the Securities and Exchange Commission (the “SEC”) from time to time. Other factors that could cause our actual results and financial condition to differ materially include, but are not limited to, changes in political, economic or industry conditions, including the risks of a slowing economy, rising inflation and risk of recession, disruptions related to tariffs and other trade or sanction issues, government shutdowns and volatility in the financial services sector, including bank failures; the interest rate environment or conditions affecting the financial and capital markets; the impact of global health crises on our or our portfolio companies’ business and the U.S. and global economies; our, or our portfolio companies’, future business, operations, operating results or prospects; risks associated with possible disruption due to terrorism in our operations or the economy generally; and future changes in laws or regulations and conditions in our or our portfolio companies’ operating areas. These statements are based on our current expectations, estimates, forecasts, information and projections about the industry in which we operate and the beliefs and assumptions of our management as of the date of filing of this Quarterly Report. We assume no obligation to update or revise any forward-looking statements, whether as a resu…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Some of the statements in this Quarterly Report constitute forward-looking statements because they relate to future events or our future performance or financial condition. Forward-looking statements may include, among other things, statements as to our future operating results, our business prospects and the prospects of our portfolio companies, the impact of the investments that we expect to make, the ability of our portfolio companies to achieve their objectives, our expected financings and investments, the adequacy of our cash resources and working capital, and the timing of cash flows, if any, from the operations of our portfolio companies. Words such as “expect,” “anticipate,” “target,” “goals,” “project,” “intend,” “plan,” “believe,” “seek,” “estimate,” “continue,” “forecast,” “may,” “should,” “potential,” variations of such words, and similar expressions indicate a forward-looking statement, although not all forward-looking statements include these words. Readers are cautioned that the forward-looking statements contained in this Quarterly Report are only predictions, are not guarantees of future performance, and are subject to risks, events, uncertainties and assumptions that are difficult to predict. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason, including the items discussed herein, in Item 1A titled “Risk Factors” in Part I of our Annual Report on Form 10-K for the year ended December 31, 2025 and in Item 1A titled “Risk Factors” in Part II of our subsequently filed Quarterly Reports on Form 10-Q or in other reports that we may file with the Securities and Exchange Commission (the “SEC”) from time to time. Other factors that could cause our actual results and financial condition to differ materially include, but are not limited to, changes in political, economic or industry conditions, including the risks of a slowing economy, rising inflation and risk of recession, disruptions related to tariffs and other trade or sanction issues, government shutdowns and volatility in the financial services sector, including bank failures; the interest rate environment or conditions affecting the financial and capital markets; the impact of global health crises on our or our portfolio companies’ business and the U.S. and global economies; our, or our portfolio companies’, future business, operations, operating results or prospects; risks associated with possible disruption in our operations due to terrorism, geopolitical conflict or the economy generally; and future changes in laws or regulations and conditions in our or our portfolio companies’ operating areas. These statements are based on our current expectations, estimates, forecasts, information and projections about the industry in which we operate and the beliefs and assumptions of our management as of the date of filing of this Quarterly Report. We assume no obligation to update or revise any forward-looking statem…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

Barings focuses on investing our portfolio primarily in senior secured private debt investments in well-established middle-market businesses that operate across a wide range of industries. Barings’ existing SEC co-investment exemptive relief under the 1940 Act (as amended, the “Co-Investment Exemptive Relief”) permits us and Barings’ affiliated private and SEC-registered funds to co-invest in Barings-originated loans, which allows Barings to efficiently implement its senior secured private debt investment strategy for us.

Current wording

Barings focuses on investing our portfolio primarily in senior secured private debt investments in well-established middle-market businesses that operate across a wide range of industries. Barings believes such investments can be considered defensive in the context of a broader portfolio construction. Barings’ SEC co-investment exemptive relief under the 1940 Act permits us and Barings’ affiliated private and SEC-registered funds to co-invest in Barings-originated loans, which allows Barings to efficiently implement its senior secured private debt investment strategy for us.

Previous wording

Barings employs fundamental credit analysis, and targets investments in businesses with relatively low levels of cyclicality and operating risk. The holding size of each position will generally be dependent upon a number of factors including total facility size, pricing and structure, and the number of other lenders in the facility. Barings has experience managing levered vehicles, both public and private, and will seek to enhance our returns through the use of leverage with a prudent approach that prioritizes capital preservation. Barings believes this strategy and approach offers attractive risk/return with lower volatility given the potential for fewer defaults and greater resilience through market cycles. A significant portion of our investments are expected to be rated below investment grade by rating agencies or, if unrated would be rated below investment grade if they were rated. Below investment grade 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.

Current wording

Barings employs fundamental credit analysis, and targets investments in businesses with relatively low levels of cyclicality and operating risk. The holding size of each position will generally be dependent upon a number of factors including total facility size, pricing and structure, and the number of other lenders in the facility. Barings has experience managing levered vehicles, both public and private, and seeks to enhance our returns through the use of leverage with a prudent approach that prioritizes capital preservation. Barings believes this strategy and approach offers attractive risk/return with lower volatility given the potential for fewer defaults and greater resilience through market cycles. A significant portion of our investments are expected to be rated below investment grade by rating agencies or, if unrated would be rated below investment grade if they were rated. Below investment grade 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.

Previous wording

We generate revenues in the form of interest income, primarily from our investments in debt securities, loan origination and other fees and dividend income. Fees generated in connection with our debt investments are recognized over the life of the loan using the effective interest method or, in some cases, recognized as earned. Our senior secured, middle-market, private debt investments generally have terms of between five and seven years. Our senior secured, middle-market, first lien private debt investments generally bear interest between the Secured Overnight Financing Rate (“SOFR”) (or the applicable currency rate for investments in foreign currencies) plus 450 basis points and SOFR plus 650 basis points per annum. Our subordinated middle-market, private debt investments generally bear interest between SOFR (or the applicable currency rate for investments in foreign currencies) plus 700 basis points and SOFR plus 900 basis points per annum if floating rate, and between 8% and 15% if fixed rate. From time to time, certain of our investments may have a form of interest, referred to as payment-in-kind (“PIK”) interest, which is not paid currently but is instead accrued and added to the loan balance and paid at the end of the term. To a lesser extent, we will invest opportunistically in assets such as, without limitation, equity, special situations, structured credit (e.g., private asset-backed securities), syndicated loan opportunities and/or mortgage securities.

Current wording

We generate revenues in the form of interest income, primarily from our investments in debt securities, loan origination and other fees and dividend income. Fees generated in connection with our debt investments are recognized over the life of the loan using the effective interest method or, in some cases, recognized as earned. Our senior secured, middle-market, private debt investments generally have terms of between five and seven years. Our senior secured, middle-market, first lien private debt investments generally bear interest between the Secured Overnight Financing Rate (“SOFR”) (or the applicable currency rate for investments in foreign currencies) plus 450 basis points and SOFR plus 650 basis points per annum. Our subordinated middle-market, private debt investments generally bear interest between SOFR (or the applicable currency rate for investments in foreign currencies) plus 700 basis points and SOFR plus 900 basis points per annum if floating rate, and between 8% and 15% if fixed rate. From time to time, certain of our investments may have a form of interest, referred to as payment-in-kind (“PIK”) interest, which is not paid currently but is instead accrued and added to the loan balance and paid at the end of the term. To a lesser extent, we will invest opportunistically in assets such as, without limitation, equity, special situations, structured credit (e.g., private asset-backed securities), syndicated loan opportunities and/or high yield investments.

Previous wording

As of September 30, 2025 and December 31, 2024, the weighted average yield on the principal amount of our outstanding debt investments other than non-accrual debt investments was approximately 9.8% and 10.2%, respectively. The weighted average yield on the principal amount of all of our outstanding debt investments (including non-accrual debt investments) was approximately 9.3% and 9.8% as of September 30, 2025 and December 31, 2024, respectively.

Current wording

As of March 31, 2026 and December 31, 2025, the weighted average yield on the principal amount of our outstanding debt investments other than non-accrual debt investments was approximately 9.4% and 9.5%, respectively. The weighted average yield on the principal amount of all of our outstanding debt investments (including non-accrual debt investments) was approximately 9.1% and 9.0% as of March 31, 2026 and December 31, 2025, respectively.

Previous wording

Our investment adviser, Barings, a wholly-owned subsidiary of Massachusetts Mutual Life Insurance Company, is a leading global asset management firm and is registered with the SEC as an investment adviser under the Investment Advisers Act of 1940, as amended. Barings’ primary investment capabilities include fixed income, private credit, real estate, equity, and alternative investments. Subject to the overall supervision of our Board of Directors (the “Board”), Barings’ Global Private Finance Group (“Barings GPFG”) manages our day-to-day operations, and provides investment advisory and management services to us. Barings GPFG is part of Barings’ $375.0 billion Global Fixed Income Platform (as of September 30, 2025) that invests in liquid, private and structured credit. Barings GPFG also advises private funds and separately managed accounts, along with multiple public vehicles.

Current wording

Our investment adviser, Barings, a subsidiary of Massachusetts Mutual Life Insurance Company, is a leading global asset management firm and is registered with the SEC as an investment adviser under the Investment Advisers Act of 1940, as amended. Barings’ primary investment capabilities include fixed income, private credit, real estate, equity, and alternative investments. Subject to the oversight of our Board of Directors (the “Board”), the portfolio managers manage our day-to-day operations with the support of the relevant Barings investment teams and investment committees which provide investment advisory and management services to us. Barings Global Private Finance and Capital Solutions investment teams (“Barings GPF”) is part of Barings’ $383.8 billion Global Fixed Income Platform (as of March 31, 2026) that invests in liquid, private and structured credit. Barings GPF manages private funds and separately managed accounts, along with multiple public vehicles.

Previous wording

Included in Barings GPFG is Barings North American Private Finance Team (the “U.S. Investment Team”), which consists of 57 investment professionals (as of September 30, 2025) located in three offices in the United States. The U.S. Investment Team provides a full set of solutions to the North American middle market, including first and second lien senior secured loans, unitranche structures, revolvers, mezzanine debt and equity co-investments. The U.S. Investment Team averages over 20 years of industry experience at the Managing Director and Director level. Also included in Barings GPFG are its Europe and Asia-Pacific Investment Committees and Private Finance Teams, which are responsible for our investment origination and portfolio monitoring activities for middle-market companies in Europe and Asia-Pacific geographies. In addition, Barings believes that it has best-in-class support personnel, including expertise in risk management, legal, accounting, tax, information technology and compliance, among others. We expect to benefit from the support provided by these personnel in our operations.

Current wording

Included in Barings GPF are investment teams focused on illiquid investments and are principally segmented based on the jurisdictions in which the investment teams are located. Barings GPF provides a full set of solutions to middle market issuers in their respective geographies, including first and second lien senior secured loans, unitranche structures, revolvers, mezzanine debt and equity co-investments. The Barings GPF investment team averages over 18 years of industry experience at the Managing Director and Director level. Barings believes that it has best-in-class support personnel, including expertise in risk management, legal, accounting, tax, information technology and compliance, among others. We expect to benefit from the support provided by these personnel in our operations.

Previous wording

On July 24, 2018, our stockholders voted at a special meeting of stockholders (the “2018 Special Meeting”) to approve a proposal to authorize us to be subject to a reduced asset coverage ratio of at least 150% under the 1940 Act. As a result of the stockholder approval at the 2018 Special Meeting, effective July 25, 2018, our applicable asset coverage ratio under the 1940 Act has been decreased to 150% from 200%. As a result, we are permitted under the 1940 Act to incur indebtedness at a level which is more consistent with a portfolio of senior secured debt. As of September 30, 2025, our asset coverage ratio was 171.5%.

Current wording

On July 24, 2018, our stockholders voted at a special meeting of stockholders (the “2018 Special Meeting”) to approve a proposal to authorize us to be subject to a reduced asset coverage ratio of at least 150% under the 1940 Act. As a result of the stockholder approval at the 2018 Special Meeting, effective July 25, 2018, our applicable asset coverage ratio under the 1940 Act has been decreased to 150% from 200%. As a result, we are permitted under the 1940 Act to incur indebtedness at a level which is more consistent with a portfolio of senior secured debt. As of March 31, 2026, our asset coverage ratio was 180.6%.

Previous wording

The total value of our investment portfolio was $2,536.3 million as of September 30, 2025, as compared to $2,449.3 million as of December 31, 2024. As of September 30, 2025, we had investments in 333 portfolio companies with an aggregate cost of $2,564.0 million. As of December 31, 2024, we had investments in 328 portfolio companies with an aggregate cost of $2,522.7 million. As of both September 30, 2025 and December 31, 2024, none of our portfolio investments represented greater than 10% of the total fair value of our investment portfolio.

Current wording

The total value of our investment portfolio was $2,370.0 million as of March 31, 2026, as compared to $2,398.5 million as of December 31, 2025. As of March 31, 2026, we had investments in 331 portfolio companies with an aggregate cost of $2,405.9 million. As of December 31, 2025, we had investments in 333 portfolio companies with an aggregate cost of $2,424.3 million. As of both March 31, 2026 and December 31, 2025, none of our portfolio investments represented greater than 10% of the total fair value of our investment portfolio.

Previous wording

During the nine months ended September 30, 2024, we made 30 new investments totaling $195.9 million and made investments in existing portfolio companies totaling $149.9 million. We had 35 loans repaid totaling $282.7 million and recognized a net realized loss on these transactions of $12.7 million. We also received $103.4 million of portfolio company principal payments and sales proceeds and recognized a net realized loss on these transactions of $0.5 million. We received $11.0 million of return of capital from our joint ventures, equity, and royalty rights investments. In addition, investments in two portfolio companies were restructured, which resulted in a net realized loss of $12.6 million. Lastly, we received proceeds related to the sale of equity investments totaling $37.4 million and recognized a net realized gain on such sales totaling $8.2 million.

Current wording

During the three months ended March 31, 2026, we made 13 new portfolio company investments totaling $54.7 million and made investments in existing portfolio companies totaling $54.0 million. We had 10 loans repaid totaling $66.4 million and recognized a net realized gain on these transactions of $0.5 million. We also received $31.4 million of portfolio company principal payments and sales proceeds and recognized a net realized loss on these transactions of $0.9 million. We received $22.3 million of return of capital from our joint ventures, equity, and royalty rights investments. Also, investments in one portfolio company were restructured, which resulted in a net realized loss of $4.5 million. Lastly, we received proceeds related to the sale of equity investments and the Sierra Income Corporation (“Sierra”) collateralized loan obligation (“CLO”) investments totaling $5.3 million and recognized a net realized loss on such sales totaling $3.2 million.

Previous wording

During the nine months ended September 30, 2025, we made 47 new investments totaling $356.6 million and made investments in existing portfolio companies totaling $198.1 million. We had 32 loans repaid totaling $187.0 million and recognized a net realized loss on these transactions of $27.7 million. We also received $124.5 million of portfolio company principal payments and sales proceeds and recognized a net realized loss on these transactions of $0.2 million. We received $11.8 million of return of capital from our joint ventures, equity, and royalty rights investments. We also received proceeds of $4.7 million related to the exit of one of our royalty rights investments and recognized a realized gain on such exit of $2.5 million. In addition, we sold $149.5 million of middle-market portfolio debt investments to our joint ventures, recognizing a net realized gain on these transactions of $1.3 million. Also, investments in three portfolio companies were restructured, which resulted in a net realized loss of $7.1 million. Lastly, we received proceeds related to the sale of equity investments totaling $25.9 million and recognized a net realized gain on such sales totaling $3.9 million.

Current wording

During the three months ended March 31, 2025, we made 14 new portfolio company investments totaling $128.2 million and made investments in existing portfolio companies totaling $78.7 million. We had 10 loans repaid totaling $66.1 million and recognized a net realized loss on these transactions of $10.2 million. We also received $33.9 million of portfolio company principal payments and sales proceeds and recognized a net realized loss on these transactions of $0.4 million. We received $5.2 million of return of capital from our joint ventures, equity, and royalty rights investments. Lastly, we received proceeds related to the sales and exits of equity investments totaling $1.1 million and recognized a net realized loss on such sales totaling $7.1 million.

Previous wording

Total portfolio investment activity for the nine months ended September 30, 2025 and 2024 was as follows:

Current wording

Total portfolio investment activity for the three months ended March 31, 2026 and 2025 was as follows:

Previous wording

Generally, when interest and/or principal payments on a loan become past due, or if we otherwise do not expect the borrower to be able to service its debt and other obligations, we will place the loan on non-accrual status and will generally cease recognizing interest income on that loan for financial reporting purposes until all principal and interest have been brought current through payment or due to a restructuring such that the interest income is deemed to be collectible. As of September 30, 2025, we had eight portfolio companies with investments on non-accrual, the aggregate fair value of which was $20.4 million, which comprised 0.8% of the total fair value of our portfolio, and the aggregate cost of which was $45.4 million, which comprised 1.8% of the total cost of our portfolio. Excluding the non-accrual assets that are covered by the Sierra Credit Support Agreement (as defined in “Note 2. Agreements and Related Party Transactions”) with Barings, the non-accruals as of September 30, 2025 comprised 0.4% of the total fair value of our portfolio and 1.1% of the aggregate cost of our portfolio. As of December 31, 2024, we had eight portfolio companies with investments on non-accrual, the aggregate fair value of which was $8.0 million, which comprised 0.3% of the total fair value of our portfolio, and the aggregate cost of which was $41.6 million, which comprised 1.6% of the total cost of our portfolio. Excluding the non-accrual assets that are covered by the Sierra Credit Support Agreement with Barings, the non-accruals as of December 31, 2024 comprised 0.2% of the total fair value of our portfolio and 0.9% of the aggregate cost of our portfolio.

Current wording

Generally, when interest and/or principal payments on a loan become past due, or if we otherwise do not expect the borrower to be able to service its debt and other obligations, we will place the loan on non-accrual status and will generally cease recognizing interest income on that loan for financial reporting purposes until all principal and interest have been brought current through payment or due to a restructuring such that the interest income is deemed to be collectible. As of March 31, 2026, we had 10 portfolio companies with investments on non-accrual, the aggregate fair value of which was $23.9 million, which comprised 1.0% of the total fair value of our portfolio, and the aggregate cost of which was $48.2 million, which comprised 2.0% of the total cost of our portfolio. Excluding the non-accrual assets that are covered by the Sierra Credit Support Agreement (as defined in “Note 2. Agreements and Related Party Transactions”) with Barings, the non-accruals as of March 31, 2026 comprised 0.6% of the total fair value of our portfolio and 1.3% of the aggregate cost of our portfolio. As of December 31, 2025, we had seven portfolio companies with investments on non-accrual, the aggregate fair value of which was $17.0 million, which comprised 0.7% of the total fair value of our portfolio, and the aggregate cost of which was $33.5 million, which comprised 1.4% of the total cost of our portfolio. Excluding the non-accrual assets that are covered by the Sierra Credit Support Agreement with Barings, the non-accruals as of December 31, 2025 comprised 0.2% of the total fair value of our portfolio and 0.7% of the aggregate cost of our portfolio.

Previous wording

During the quarter ended June 30, 2025, we placed our debt investment in Acogroup on non-accrual status. As a result, under U.S. generally accepted accounting principles (“U.S. GAAP”), we will not recognize interest income on our debt investment in Acogroup for financial reporting purposes. As of September 30, 2025, the cost of our debt investment in Acogroup was $8.1 million and the fair value of such investments was $3.6 million.

Current wording

During the quarter ended June 30, 2025, we placed our debt investment in Acogroup on non-accrual status. As a result, under U.S. generally accepted accounting principles (“U.S. GAAP”), we will not recognize interest income on our debt investment in Acogroup for financial reporting purposes. As of March 31, 2026, the cost of our debt investment in Acogroup was $8.1 million and the fair value of such investment was $2.5 million.

Previous wording

During the quarter ended September 30, 2024, we placed our debt investment in Biolam Group, or Biolam, on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our debt investment in Biolam for financial reporting purposes. As of September 30, 2025, the cost of our debt investment in Biolam was $2.6 million and the fair value of such investment was $1.7 million.

Current wording

During the quarter ended September 30, 2024, we placed our debt investment in Biolam Group, or Biolam, on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our debt investment in Biolam for financial reporting purposes. As of March 31, 2026, the cost of our debt investment in Biolam was $2.6 million and the fair value of such investment was $1.3 million.

Previous wording

Eurofins Digital Testing International LUX Holdings SARL

Current wording

Eurofins Digital Testing International LUX Holding SARL

Previous wording

During the quarter ended June 30, 2024, we placed our debt investments in Eurofins Digital Testing International LUX Holdings SARL, or Eurofins, on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our debt investments in Eurofins for financial reporting purposes. As of September 30, 2025, the cost of our debt investments in Eurofins was $5.4 million and the fair value of such investments was $1.9 million.

Current wording

During the quarter ended March 31, 2026, we placed our subordinated debt investment in Eurofins Digital Testing International LUX Holding SARL, or Eurofins, on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our subordinated debt investment in Eurofins for financial reporting purposes. As of March 31, 2026, the cost of our subordinated debt investment in Eurofins was $1.4 million and the fair value of such investment was nil.

Previous wording

In connection with the Sierra Merger we purchased our debt investment in Polymer Solutions Group Holdings, LLC, or Polymer. During the quarter ended December 31, 2024, we placed our debt investment in Polymer on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our debt investment in Polymer for financial reporting purposes. As of September 30, 2025, the cost of our debt investment in Polymer was $1.0 million and the fair value of such investment was $0.4 million.

Current wording

In connection with the Sierra Merger, we purchased our debt investment in Polymer Solutions Group Holdings, LLC, or Polymer. During the quarter ended December 31, 2024, we placed our debt investment in Polymer on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our debt investment in Polymer for financial reporting purposes. As of March 31, 2026, the cost of our debt investment in Polymer was $1.0 million and the fair value of such investment was $0.3 million.

Previous wording

During the quarter ended September 30, 2025, we placed our debt investments in RA Outdoors, LLC, or RA Outdoors, on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our debt investments in RA Outdoors for financial reporting purposes. As of September 30, 2025, the cost of our debt investments in RA Outdoors was $16.1 million and the fair value of such investments was $10.2 million.

Current wording

In connection with the Sierra Merger, we purchased our debt investments in RA Outdoors, LLC, or RA Outdoors. During the quarter ended September 30, 2025, we placed our debt investments in RA Outdoors on non-accrual status. As a result, under U.S. GAAP, we will not recognize interest income on our debt investments in RA Outdoors for financial reporting purposes. As of March 31, 2026, the cost of our debt investments in RA Outdoors was $16.4 million and the fair value of such investments was $10.2 million.

Previous wording

In addition to our non-accrual assets, during the quarter ended September 30, 2024, we placed our first lien senior secured debt investment in A.T. Holdings II LTD, or A.T. Holdings, on non-accrual status only with respect to the PIK interest component of the loan. As of September 30, 2025, the cost of our debt investment in A.T. Holdings was $11.9 million, or 0.5% of the total cost of our portfolio, and the fair value of such investment was $7.8 million, or 0.3% of the total fair value of our portfolio.

Current wording

In addition to our non-accrual assets, during the quarter ended September 30, 2024, we placed our first lien senior secured debt investment in A.T. Holdings II LTD, or A.T. Holdings, on non-accrual status only with respect to the PIK interest component of the loan. As of March 31, 2026, the cost of our debt investment in A.T. Holdings was $11.9 million, or 0.5% of the total cost of our portfolio, and the fair value of such investment was $7.4 million, or 0.3% of the total fair value of our portfolio.

Previous wording

Comparison of the three and nine months ended September 30, 2025 and September 30, 2024

Current wording

Comparison of the three months ended March 31, 2026 and March 31, 2025

Previous wording

Operating results for the three and nine months ended September 30, 2025 and 2024 were as follows:

Current wording

Operating results for the three months ended March 31, 2026 and 2025 were as follows:

Previous wording

The change in total investment income for the three months ended September 30, 2025, as compared to the three months ended September 30, 2024 was primarily due to increased dividends from portfolio companies and joint venture investments, partially offset by a decrease in the weighted average yield on the portfolio and decreased fee and other income. The change in total investment income for the nine months ended September 30, 2025, as compared to the nine months ended September 30, 2024 was primarily due to a decrease in the weighted average yield on the portfolio, partially offset by increased dividends from portfolio companies and joint venture investments and increased fee and other income. The weighted average yield on the principal amount of our outstanding debt investments, other than non-accrual debt investments, was 9.8% as of September 30, 2025, as compared to 10.6% as of September 30, 2024.

Current wording

The change in total investment income for the three months ended March 31, 2026, as compared to the three months ended March 31, 2025 was primarily due to a decrease in the amount of our outstanding debt investments, decreased weighted average yield on the portfolio and decreased fee and other income, partially offset by increased dividends from portfolio companies and joint venture investments. The amount of our outstanding debt investments decreased from $2,218.0 million as of March 31, 2025 to $1,998.8 million as of March 31, 2026. In addition, the weighted average yield on the principal amount of our outstanding debt investments, other than non-accrual debt investments, decreased from 9.9% as of March 31, 2025 to 9.4% as of March 31, 2026. For the three months ended March 31, 2026, fee and other income was $2.7 million as compared to $3.6 million for the three months ended March 31, 2025. For the three months ended March 31, 2026, dividend income was $11.9 million as compared to $10.7 million for the three months ended March 31, 2025.

Previous wording

Interest and other financing fees during the three and nine months ended September 30, 2025 were attributable to borrowings under the February 2019 Credit Facility, the August 2025 Notes, the November Notes, the February Notes, the November 2026 Notes, the February 2029 Notes and the September 2028 Notes (each as defined below under “Liquidity and Capital Resources”). Interest and other financing fees during the three and nine months ended September 30, 2024 were attributable to borrowings under the February 2019 Credit Facility, the August 2025 Notes, the November Notes, the February Notes, the November 2026 Notes and the February 2029 Notes. The decrease in interest and other financing fees for the three and nine months ended September 30, 2025 as compared to the three and nine months ended September 30, 2024, was primarily attributed to a lower weighted average interest rate on the February 2019 Credit Facility, partially offset by higher weighted average borrowings outstanding. The weighted average interest rate on the February 2019 Credit Facility for the three and nine months ended September 30, 2025 was 5.2% and 5.7%, respectively, as compared to 6.6% and 6.9%, respectively, for the three and nine months ended September 30, 2024. For the three and nine months ended September 30, 2025, the weighted average borrowings outstanding on the February 2019 Credit Facility were $541.0 million and $503.9 million, respectively, as compared to $320.7 million and $428.5 million, respectively, for the three and nine months ended September 30, 2024.

Current wording

Interest and other financing fees during the three months ended March 31, 2026 were attributable to borrowings under the February 2019 Credit Facility, the Series C Notes of the November Notes, the February Notes, the November 2026 Notes, the February 2029 Notes and the September 2028 Notes (each as defined below under “Liquidity and Capital Resources”). Interest and other financing fees during the three months ended March 31, 2025 were attributable to borrowings under the February 2019 Credit Facility, the August 2025 Notes (as defined below under “Liquidity and Capital Resources”), the Series B Notes and Series C Notes of the November Notes, the February Notes, the November 2026 Notes and the February 2029 Notes. The decrease in interest and other financing fees for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025, was primarily attributed to lower weighted average borrowings outstanding and a lower weighted average interest rate on the February 2019 Credit Facility, partially offset by higher net unsecured debt outstanding as of March 31, 2026. For the three months ended March 31, 2026, the weighted average borrowings outstanding on the February 2019 Credit Facility was $211.7 million as compared to $410.1 million for the three months ended March 31, 2025. The weighted average interest rate on the February 2019 Credit Facility for the three months ended March 31, 2026 was 4.1% as compared to 5.9% for the three months ended March 31, 2025. For the three months ended March 31, 2026, the weighted average unsecured debt outstanding was $1,182.3 million as compared to $1,025.0 million for the three months ended March 31, 2025. The weighted average interest rate on the unsecured debt for the three months ended March 31, 2026 was 5.1% as compared to 4.9% for the three months ended March 31, 2025.

Previous wording

Under the terms of the Barings BDC Advisory Agreement, we pay Barings a base management fee (the “Base Management Fee”), quarterly in arrears on a calendar quarter basis. The Base Management Fee is calculated based on the average value of our gross assets, excluding cash and cash equivalents, at the end of the two most recently completed calendar quarters prior to the quarter for which such fees are being calculated. Base Management Fees for any partial month or quarter are appropriately pro-rated. See “Note 2. Agreements and Related Party Transactions” to our Unaudited Consolidated Financial Statements for additional information regarding the terms of the Barings BDC Advisory Agreement and the fee arrangements thereunder. For the three and nine months ended September 30, 2025, the amount of Base Management Fees incurred were approximately $8.4 million and $24.6 million, respectively. For the three and nine months ended September 30, 2024, the amount of Base Management Fees incurred were approximately $8.0 million and $24.5 million, respectively.

Current wording

Under the terms of the Barings BDC Advisory Agreement, we pay Barings a base management fee (the “Base Management Fee”), quarterly in arrears on a calendar quarter basis. The Base Management Fee is calculated based on the average value of our gross assets, excluding cash and cash equivalents, at the end of the two most recently completed calendar quarters prior to the quarter for which such fees are being calculated. Base Management Fees for any partial month or quarter are appropriately pro-rated. See “Note 2. Agreements and Related Party Transactions” to our Unaudited Consolidated Financial Statements for additional information regarding the terms of the Barings BDC Advisory Agreement and the fee arrangements thereunder. For the three months ended March 31, 2026 and 2025, the amount of Base Management Fees incurred were approximately $8.3 million and $8.0 million, respectively.

Previous wording

The increase in the Base Management Fees for the three months ended September 30, 2025 versus the three months ended September 30, 2024 is primarily related to the average value of gross assets increasing from $2,574.8 million as of the end of the two most recently completed calendar quarters prior to September 30, 2024 to $2,692.9 million as of the end of the two most recently completed calendar quarters prior to September 30, 2025. For both the three and nine months ended September 30, 2025 and 2024, the Base Management Fee rate was 1.250%.

Current wording

The increase in the Base Management Fees for the three months ended March 31, 2026 versus the three months ended March 31, 2025 is primarily related to the average value of gross assets increasing from $2,566.0 million as of the end of the two most recently completed calendar quarters prior to March 31, 2025 to $2,654.1 million as of the end of the two most recently completed calendar quarters prior to March 31, 2026. For both the three months ended March 31, 2026 and 2025, the Base Management Fee rate was 1.250%.

Previous wording

Under the Barings BDC Advisory Agreement, we pay Barings an incentive fee (the “Incentive Fee”). A portion of the Incentive Fee is based on our income (the “Income-Based Fee”) and a portion is based on our capital gains (the “Capital Gains Fee”). The Income-Based Fee is determined and paid quarterly in arrears based on the amount by which (x) the aggregate pre-incentive fee net investment income in respect of the current calendar quarter and the eleven preceding calendar quarters beginning with the calendar quarter that commences on or after January 1, 2021, as the case may be (or the appropriate portion thereof in the case of any of our first eleven calendar quarters that commences on or after January 1, 2021) exceeds (y) the hurdle amount as calculated for the same period. See “Note 2. Agreements and Related Party Transactions” to our Unaudited Consolidated Financial Statements for additional information regarding the terms of the Barings BDC Advisory Agreement and the fee arrangements thereunder. For the three and nine months ended September 30, 2025, the amount of Income-Based Fees incurred were $5.6 million and $24.5 million, respectively, as compared to $6.6 million and $15.9 million, for the three and nine months ended September 30, 2024. The Income-Based Fee is subject to a cap (the “Incentive Fee Cap”). The Incentive Fee

Current wording

Under the Barings BDC Advisory Agreement, we pay Barings an incentive fee (the “Incentive Fee”). A portion of the Incentive Fee is based on our income (the “Income-Based Fee”) and a portion is based on our capital gains (the “Capital Gains Fee”). The Income-Based Fee is determined and paid quarterly in arrears based on the amount by which (x) the aggregate pre- incentive fee net investment income in respect of the current calendar quarter and the eleven preceding calendar quarters beginning with the calendar quarter that commences on or after January 1, 2021, as the case may be (or the appropriate portion thereof in the case of any of our first eleven calendar quarters that commences on or after January 1, 2021) exceeds (y) the hurdle amount as calculated for the same period. See “Note 2. Agreements and Related Party Transactions” to our Unaudited Consolidated Financial Statements for additional information regarding the terms of the Barings BDC Advisory Agreement and the fee arrangements thereunder. For the three months ended March 31, 2026, the amount of Income-Based Fees incurred were $4.7 million as compared to $7.7 million for the three months ended March 31, 2025. The Income-Based Fee is subject to a cap (the “Incentive Fee Cap”). The Incentive Fee Cap in any quarter is an amount equal to (a) 20% of the Cumulative Pre-Incentive Fee Net Return during the relevant Trailing Twelve Quarters less (b) the aggregate Income-Based Fees that were paid to the Adviser in the preceding eleven calendar quarters (or portion thereof) comprising the relevant Trailing Twelve Quarters. See “Note 2. Agreements and Related Party Transactions” to our Unaudited Consolidated Financial Statements for additional information regarding the terms of the Incentive Fee Cap.

Previous wording

The Incentive Fee for both the three months ended September 30, 2025 and September 30, 2024, was limited to the Incentive Fee Cap, however, the Incentive Fee Cap in 2025 was lower than the Incentive Fee Cap in 2024 as a result of an increase in Cumulative Pre-Incentive Fee Net Return partially offset by a larger increase in incentive fees paid in the trailing twelve quarters.

Current wording

The incentive fee for both the three months ended March 31, 2026 and March 31, 2025, was limited to the Incentive Fee Cap. The Incentive Fee Cap for the three months ended March 31, 2026 was lower than the Incentive Fee Cap for the three months ended March 31, 2025 as a result of an increase in Cumulative Pre-Incentive Fee Net Return partially offset by a greater increase in incentive fees paid in the trailing twelve quarters (or portion thereof).

Previous wording

We entered into the Administration Agreement with Barings in August 2018. Under the terms of the Administration Agreement, Barings performs (or oversees, or arranges for, the performance of) the administrative services necessary for our operations. We reimburse Barings for the costs and expenses incurred by it in performing its obligations and providing personnel and facilities under the Administration Agreement in an amount to be negotiated and mutually agreed to by us and Barings quarterly in arrears; provided that the agreed-upon quarterly expense amount will not exceed the amount of expenses that would otherwise be reimbursable by us under the Administration Agreement for the applicable quarterly period, and Barings will not be entitled to the recoupment of any amounts in excess of the agreed-upon quarterly expense amount. See “Note 2. Agreements and Related Party Transactions” to our Unaudited Consolidated Financial Statements for additional information regarding the Administration Agreement. For the three and nine months ended September 30, 2025, the amount of administration expenses incurred and invoiced by Barings for expenses was approximately $0.4 million and $1.1 million, respectively. For the three and nine months ended September 30, 2024 the amount of administration expenses incurred and invoiced by Barings for expenses was approximately $0.4 million and $1.4 million, respectively. In addition to expenses incurred under the Administration Agreement, general and administrative expenses include fees payable to the members of our Board for their service on the Board, directors’ and officers’ insurance costs, as well as legal and accounting expenses.

Current wording

We entered into the Administration Agreement with Barings in August 2018. Under the terms of the Administration Agreement, Barings performs (or oversees, or arranges for, the performance of) the administrative services necessary for our operations. We reimburse Barings for the costs and expenses incurred by it in performing its obligations and providing personnel and facilities under the Administration Agreement in an amount to be negotiated and mutually agreed to by us and Barings quarterly in arrears; provided that the agreed-upon quarterly expense amount will not exceed the amount of expenses that would otherwise be reimbursable by us under the Administration Agreement for the applicable quarterly period, and Barings will not be entitled to the recoupment of any amounts in excess of the agreed-upon quarterly expense amount. See “Note 2. Agreements and Related Party Transactions” to our Unaudited Consolidated Financial Statements for additional information regarding the Administration Agreement. For the three months ended March 31, 2026 and 2025, the amount of administration expenses incurred and invoiced by Barings for expenses was approximately $0.4 million and $0.3 million, respectively. In addition to expenses incurred under the Administration Agreement, general and administrative expenses include fees payable to the members of our Board for their service on the Board, directors’ and officers’ insurance costs, as well as legal and accounting expenses.

Previous wording

Net realized gains (losses) during the three and nine months ended September 30, 2025 and 2024 were as follows:

Current wording

Net realized gains (losses) during the three months ended March 31, 2026 and 2025 were as follows:

Previous wording

During the three months ended September 30, 2024, we recognized net realized losses totaling $10.9 million, which consisted primarily of a net loss on our investment portfolio of $8.5 million and net loss on forward currency contracts of $2.9 million, partially offset by a net gain on foreign currency transactions of $0.5 million. The net loss on our investment portfolio predominantly related to a $12.5 million loss on the exit of one investment, partially offset by a $4.2 million gain on the sale of two investments, which were partially reclassified from unrealized depreciation during the three months ended September 30, 2024. During the nine months ended September 30, 2024, we recognized net realized losses of $24.3 million, which consisted primarily of a net loss on our investment portfolio of $17.6 million, and a net loss on forward currency contracts of $7.5 million, partially offset by a net gain on foreign currency transactions of $0.9 million. The net loss on our investment portfolio was primarily comprised of a $12.7 million loss on the restructuring of two investments, a $16.7 million loss on the sale and exit of two investments, which were primarily reclassified from unrealized appreciation, partially offset by a $12.2 million gain on the sale of three investments during the nine months ended September 30, 2024.

Current wording

During the three months ended March 31, 2026, we recognized net realized losses totaling $10.8 million, which consisted primarily of a net loss on our investment portfolio of $8.2 million, a net loss on foreign currency transactions of $2.4 million and a net loss on forward currency contracts of $0.2 million. The net loss on our investment portfolio predominantly related to a $4.5 million loss on the restructuring of the investments in one portfolio company, a $6.9 million loss on the sale and exit of five Sierra CLO investments and a $1.1 million loss on the exit of one debt investment, partially offset by a gain of $3.6 million on the sale of equity investments in two portfolio companies. The net losses on these exits were predominantly reclassified from net unrealized depreciation and the $6.9 million loss on the Sierra CLO investments is covered by the Sierra Credit Support Agreement (as defined in “Note 2. Agreements and Related Party Transactions”) with Barings.

Previous wording

During the three months ended September 30, 2025, we recognized net realized losses totaling $1.3 million, which consisted primarily of a net loss on forward currency contracts of $3.0 million, partially offset by a net gain on our investment portfolio of $1.6 million and a net gain on foreign currency transactions of $0.1 million. The net gain on our investment portfolio predominantly related to a $5.6 million gain on the sale of one equity investment and a $0.7 million net gain on the sale of middle-market portfolio debt investments to our joint venture, partially offset by a $4.8 million loss on the restructuring of one investment. The $4.8 million loss on the restructure was predominantly reclassified from unrealized depreciation. During the nine months ended September 30, 2025, we recognized net realized losses totaling $17.5 million, which consisted primarily of a net loss on our investment portfolio of $27.2 million and a net loss on forward currency contracts of $2.0 million, partially offset by a net gain on the termination of the MVC Credit Support Agreement of $9.4 million and a net gain on foreign currency transactions of $2.3 million. The net loss on our investment portfolio predominantly related to a $27.9 million loss on the exit of three loan investments, a $7.3 million loss on the sale of one equity investment, and a $7.3 million loss on the restructuring of two investments, partially offset by a $10.9 million gain on the sale of four equity investments, a $2.5 million gain on the exit of one royalty rights investment, and a $1.3 million gain on the sale of middle-market portfolio debt investments to our joint venture.

Current wording

During the three months ended March 31, 2025, we recognized net realized losses totaling $1.1 million, which consisted primarily of a net loss on our investment portfolio of $17.7 million, partially offset by a net gain on forward currency contracts of $15.2 million and a net gain on foreign currency transactions of $1.4 million. The net loss on our investment portfolio predominately related to a $9.8 million loss on the exit of two loan investments and a $7.3 million loss on the exit of one equity investment, which were all primarily reclassified from unrealized appreciation during the three months ended March 31, 2025.

Previous wording

Net unrealized appreciation (depreciation) during the three and nine months ended September 30, 2025 and 2024 was as follows:

Current wording

Net unrealized appreciation (depreciation) during the three months ended March 31, 2026 and 2025 was as follows:

Previous wording

For the nine months ended September 30, 2024, we experienced a net decrease in cash in the amount of $4.5 million. During that period, our operating activities provided $167.3 million in cash, with proceeds from sales or repayments of portfolio investments totaling $422.9 million and other cash collections from investments exceeding purchases of portfolio investments of $346.0 million. In addition, our financing activities used net cash of $171.9 million, consisting of net repayments under the February 2019 Credit Facility of $377.1 million, dividends paid in the amount of $82.6 million and share repurchases of $5.0 million, partially offset by net proceeds of $292.8 million from the issuance of the February 2029 Notes. As of September 30, 2024, we had $66.0 million of cash and foreign currencies on hand, including $3.2 million of restricted cash.

Current wording

For the three months ended March 31, 2026, we experienced a net increase in cash in the amount of $28.9 million. During that period, our operating activities provided $68.0 million in cash, with proceeds from sales or repayments of portfolio investments totaling $181.1 million and other cash collections from investments exceeding purchases of portfolio investments of $108.7 million. In addition, our financing activities used net cash of $39.1 million, consisting of the repayment of the $80.0 million Series D Notes (as defined below) and dividends paid in the amount of $27.2 million, partially offset by net borrowings under the February 2019 Credit Facility of $68.2 million. As of March 31, 2026, we had $95.7 million of cash and foreign currencies on hand, including $15.8 million of restricted cash.

Previous wording

For the nine months ended September 30, 2025, we experienced a net decrease in cash in the amount of $8.1 million. During that period, our operating activities used $44.0 million in cash, consisting primarily of purchases of portfolio investments of $561.6 million, partially offset by proceeds from sales or repayments of portfolio investments totaling $425.4 million. In addition, our financing activities provided net cash of $35.9 million, consisting of net proceeds from notes payable of $294.8 million, partially offset by net repayments of the February 2019 Credit Facility of $108.7 million, dividends paid in the amount of $97.9 million, repayment of the $50.0 million August 2025 Notes and share repurchases of $2.3 million. As of September 30, 2025, we had $83.2 million of cash and foreign currencies on hand, including $12.9 million of restricted cash.

Current wording

For the three months ended March 31, 2025, we experienced a net increase in cash in the amount of $9.3 million. During that period, our operating activities used $7.8 million in cash, consisting primarily of purchases of portfolio investments of $167.2 million, partially offset by proceeds from sales or repayments of portfolio investments totaling $122.4 million. In addition, our financing activities provided net cash of $17.0 million, consisting of net borrowings under the February 2019 Credit Facility of $51.2 million, partially offset by dividends paid in the amount of $32.7 million and share repurchases of $1.5 million. As of March 31, 2025, we had $100.6 million of cash and foreign currencies on hand, including $7.3 million of restricted cash.

Previous wording

On February 21, 2019, we entered into a senior secured credit facility with ING Capital LLC (“ING”), as administrative agent, and the lenders party thereto (as amended, restated and otherwise modified from time to time, the “February 2019 Credit Facility”). The initial commitments under the February 2019 Credit Facility totaled $800.0 million. Effective on November 4, 2021, we increased aggregate commitments under the February 2019 Credit Facility to $875.0 million from $800.0 million pursuant to the accordion feature under the February 2019 Credit Facility, which allowed for an increase in the total commitments to an aggregate of $1.2 billion subject to certain conditions and satisfaction of specified financial covenants. Effective on February 25, 2022, we increased aggregate commitments under the February 2019 Credit Facility to $965.0 million from $875.0 million pursuant to the accordion feature under the February 2019 Credit Facility, which allowed for an increase in the total commitments increased to $1.5 billion from $1.2 billion subject to certain conditions and the satisfaction of specified financial covenants. Effective on April 1, 2022, we increased the aggregate commitments under the February 2019 Credit Facility to $1.1 billion from $965.0 million pursuant to the accordion feature under the February 2019 Credit Facility, which allowed for an increase in the total commitments to an aggregate of $1.5 billion subject to certain conditions and the satisfaction of specified financial covenants. We can borrow foreign currencies directly under the February 2019 Credit Facility. The February 2019 Credit Facility, which is structured as a revolving credit facility, is secured primarily by a material portion of our assets and guaranteed by certain of our subsidiaries. Following the termination on June 30, 2020, of Barings BDC Senior Funding I, LLC’s, our indirect wholly-owned Delaware limited liability company (“BSF”), credit facility entered into in August 2018 with Bank of America, N.A., BSF became a subsidiary guarantor whose assets secure the February 2019

Current wording

On February 21, 2019, we entered into a senior secured credit facility with ING Capital LLC (“ING”), as administrative agent, and the lenders party thereto (as amended, restated and otherwise modified from time to time, the “February 2019 Credit Facility”). The initial commitments under the February 2019 Credit Facility totaled $800.0 million. Effective on November 4, 2021, we increased aggregate commitments under the February 2019 Credit Facility to $875.0 million from $800.0 million pursuant to the accordion feature under the February 2019 Credit Facility, which allowed for an increase in the total commitments to an aggregate of $1.2 billion subject to certain conditions and satisfaction of specified financial covenants. Effective on February 25, 2022, we increased aggregate commitments under the February 2019 Credit Facility to $965.0 million from $875.0 million pursuant to the accordion feature under the February 2019 Credit Facility, which allowed for an increase in the total commitments to an aggregate of $1.5 billion from $1.2 billion subject to certain conditions and the satisfaction of specified financial covenants. Effective on April 1, 2022, we increased the aggregate commitments under the February 2019 Credit Facility to $1.1 billion from $965.0 million pursuant to the accordion feature under the February 2019 Credit Facility, which allowed for an increase in the total commitments to an aggregate of $1.5 billion subject to certain conditions and the satisfaction of specified financial covenants. We can borrow foreign currencies directly under the February 2019 Credit Facility. The February 2019 Credit Facility, which is structured as a revolving credit facility, is secured primarily by a material portion of our assets and guaranteed by certain of our subsidiaries. Following the termination on June 30, 2020, of Barings BDC Senior Funding I, LLC’s, our indirect wholly-owned Delaware limited liability company (“BSF”), credit facility entered into in August 2018 with Bank of America, N.A., BSF became a subsidiary guarantor whose assets secure the February 2019 Credit Facility. Effective May 9, 2023, the revolving period of the February 2019 Credit Facility was extended to February 21, 2025, followed by a one-year repayment period, and the maturity date was extended to February 21, 2026. Effective November 5, 2024 we amended the February 2019 Credit Facility to, among other things, (a) extend the revolving period from February 21, 2025 to November 5, 2028; (b) extend the stated maturity date from February 21, 2026 to November 5, 2029; (c) adjust the interest rate charged on the February 2019 Credit Facility from an applicable spread of either the term SOFR plus 2.25% (or 2.00% for so long as we maintain an investment grade credit rating) plus a credit spread adjustment of 0.10% for borrowings with an interest period of one month, 0.15% for borrowings with an interest period of three months, or 0.25% for borrowings with an interest period o…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

Borrowings denominated in U.S. Dollars under the February 2019 Credit Facility bear interest, subject to our election, on a per annum basis equal to (i) the alternate base rate plus 0.875% or (ii) the term SOFR plus an applicable spread of 1.875% plus a credit spread adjustment of 0.10%. Borrowings denominated in certain foreign currencies, other than Australian dollars, bear interest on a per annum basis equal to the applicable currency rate for the foreign currency as defined in the credit agreement plus 1.875% or for borrowings denominated in Australian dollars, 1.875% plus the applicable Australian benchmark rate, which is defined as the applicable Australian dollar Screen Rate plus 0.20%. The alternate base rate is equal to the greatest of (i) the prime rate, (ii) the federal funds rate plus 0.5%, (iii) the Overnight Bank Funding Rate plus 0.5%, (iv) one-month term SOFR plus 1.0% plus a credit spread adjustment of 0.10% and (v) 1.0%.

Current wording

Borrowings denominated in U.S. Dollars under the February 2019 Credit Facility bear interest, subject to our election, on a per annum basis equal to (i) the alternate base rate plus 0.875% or (ii) term SOFR plus an applicable spread of 1.875% plus a credit spread adjustment of 0.10%. Borrowings denominated in certain foreign currencies, other than Australian dollars, bear interest on a per annum basis equal to the applicable currency rate for the foreign currency as defined in the credit agreement plus 1.875% or for borrowings denominated in Australian dollars, 1.875% plus the applicable Australian benchmark rate, which is defined as the applicable Australian dollar Screen Rate plus 0.20%. The alternate base rate is equal to the greatest of (i) the prime rate, (ii) the federal funds rate plus 0.5%, (iii) the Overnight Bank Funding Rate plus 0.5%, (iv) one-month term SOFR plus 1.0% plus a credit spread adjustment of 0.10% and (v) 1.0%.

Previous wording

In addition, we pay a commitment fee of 0.375% per annum on undrawn amounts of the February 2019 Credit Facility. In connection with entering into the February 2019 Credit Facility, we incurred financing fees of approximately $6.4 million, which will be amortized over the life of the February 2019 Credit Facility. In connection with all amendments to the February 2019 Credit Facility, we incurred financing fees of approximately $10.7 million, which will be amortized over the remaining life of the February 2019 Credit Facility.

Current wording

In addition, we pay a commitment fee of 0.375% per annum on undrawn amounts of the February 2019 Credit Facility. In connection with entering into the February 2019 Credit Facility, we incurred financing fees of approximately $6.4 million, which will be amortized over the life of the February 2019 Credit Facility. In connection with all amendments to the February 2019 Credit Facility, we incurred financing fees of approximately $12.5 million, which will be amortized over the remaining life of the February 2019 Credit Facility.

Previous wording

As of September 30, 2025, we were in compliance with all covenants under the February 2019 Credit Facility and had borrowings under the February 2019 Credit Facility denominated in British pounds sterling of £48.6 million ($65.4 million U.S. dollars) with an interest rate of 5.875% (one month SONIA of 3.967%) and borrowings denominated in Euros of €245.6 million ($288.6 million U.S. dollars) with an interest rate of 3.750% (one month EURIBOR of 1.875%). The borrowings denominated in foreign currencies were translated into U.S. dollars based on the spot rate at the relevant balance sheet date. The impact resulting from changes in foreign exchange rates on the February 2019 Credit Facility borrowings is included in “Net unrealized appreciation (depreciation) - foreign currency transactions” in our Unaudited Consolidated Statements of Operations.

Current wording

As of March 31, 2026, we were in compliance with all covenants under the February 2019 Credit Facility and had U.S. dollar borrowings of $130.0 million outstanding under the February 2019 Credit Facility with a weighted average interest rate of 6.179% (one month SOFR of 3.671%), borrowings denominated in Canadian dollars of C$5.0 million ($3.6 million U.S. dollars) with an interest rate of 4.445% (one month CORRA of 2.570%) and borrowings denominated in Euros of €138.1 million ($159.1 million U.S. dollars) with a weighted average interest rate of 3.851% (one month EURIBOR of 1.976%). The borrowings denominated in foreign currencies were translated into U.S. dollars based on the spot rate at the relevant balance sheet date. The impact resulting from changes in foreign exchange rates on the February 2019 Credit Facility borrowings is included in “Net unrealized appreciation (depreciation) - foreign currency transactions” in our Unaudited Consolidated Statements of Operations.