10-Q

Large accelerated filer

Accelerated filer

Non-accelerated filer

Small reporting company

Emerging growth company

10-Q 1 orccii_10q_0331-2022.htm 10-Q 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

 QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

 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: 814-01219

OWL ROCK CAPITAL CORPORATION II

(Exact Name of Registrant as Specified in its Charter)


Maryland		47-5416332
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

399 Park Avenue, 38th Floor New York, New York		10022
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (212) 419-3000

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	None	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 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

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 is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒

As of May 11, 2022, the registrant had 151,210,337 shares of common stock, $0.01 par value per share, outstanding.

Table of Contents


		Page
PART I.	CONSOLIDATED FINANCIAL INFORMATION
Item 1.	Consolidated Financial Statements	4
	Consolidated Statements of Assets and Liabilities as of March 31, 2022 (Unaudited) and December 31, 2021	4
	Consolidated Statements of Operations for the Three Months Ended March 31, 2022 and 2021 (Unaudited)	5
	Consolidated Schedules of Investments as of March 31, 2022 (Unaudited) and December 31, 2021	6
	Consolidated Statements of Changes in Net Assets for the Three Months Ended March 31, 2022 and 2021 (Unaudited)	46
	Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2022 and 2021 (Unaudited)	47
	Notes to Consolidated Financial Statements (Unaudited)	48
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	86
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	127
Item 4.	Controls and Procedures	129
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	130
Item 1A.	Risk Factors	130
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	131
Item 3.	Defaults Upon Senior Securities	131
Item 4.	Mine Safety Disclosures	131
Item 5.	Other Information	132
Item 6.	Exhibits	133
	Signatures	134

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report contains forward-looking statements that involve substantial risks and uncertainties. Such statements involve known and unknown risks, uncertainties and other factors and undue reliance should not be placed thereon. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about Owl Rock Capital Corporation II (the “Company,” “we” or “our”), our current and prospective portfolio investments, our industry, our beliefs and opinions, and our assumptions. Words such as “anticipates,” “expects,” “intends,” “plans,” “will,” “may,” “continue,” “believes,” “seeks,” “estimates,” “would,” “could,” “should,” “targets,” “projects,” “outlook,” “potential,” “predicts” and variations of these words and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements, including without limitation:

•

an economic downturn could impair our portfolio companies’ ability to continue to operate, which could lead to the loss of some or all of our investments in such portfolio companies;

•

an economic downturn could disproportionately impact the companies that we intend to target for investment, potentially causing us to experience a decrease in investment opportunities and diminished demand for capital from these companies;

•

an economic downturn could also impact availability and pricing of our financing and our ability to access the debt and equity capital markets;

•

a contraction of available credit and/or an inability to access the equity markets could impair our lending and investment activities;

•

the impact of the "COVID-19" pandemic and related changes in base interest rates and significant market volatility on our business, our portfolio companies, our industry and the global economy, including as a result of recent supply chain disruptions;

•

interest rate volatility, including the decommissioning of LIBOR, could adversely affect our results, particularly because we use leverage as part of our investment strategy;

•

currency fluctuations could adversely affect the results of our investments in foreign companies, particularly to the extent that we receive payments denominated in foreign currency rather than U.S. dollars;

•

our future operating results;

•

our business prospects and the prospects of our portfolio companies including our and their ability to achieve our respective objectives as a result of the current COVID-19 pandemic;

•

the impact of interest and inflation rates on our business prospects and the prospects of our portfolio companies;

•

our contractual arrangements and relationships with third parties;

•

the ability of our portfolio companies to achieve their objectives;

•

competition with other entities and our affiliates for investment opportunities;

•

the speculative and illiquid nature of our investments;

•

the use of borrowed money to finance a portion of our investments as well as any estimates regarding potential use of leverage;

•

the adequacy of our financing sources and working capital;

•

the loss of key personnel;

•

the timing of cash flows, if any, from the operations of our portfolio companies;

•

the ability of Owl Rock Capital Advisors LLC (“the Adviser” or “our Adviser”) to locate suitable investments for us and to monitor and administer our investments;

•

the ability of the Adviser to attract and retain highly talented professionals;

•

our ability to qualify for and maintain our tax treatment as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”), and as a business development company (“BDC”);

•

the effect of legal, tax and regulatory changes including the Coronavirus Aid, Relief and Economic Security Act signed into law in December 2020 and the American Rescue Plan Act of 2021, signed into law in March 2021;

•

the impact of geo-political conditions, including revolution, insurgency, terrorism or war, including those arising out of the ongoing conflict between Russia and Ukraine; and

•

other risks, uncertainties and other factors previously identified in the reports and other documents we have filed with the Securities and Exchange Commission (“SEC”).

Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and as a result, the forward-looking statements based on those assumptions also could be inaccurate. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this report should not be regarded as a representation by us that our plans and objectives will be achieved. These forward-looking statements apply only as of the date of this report. Moreover, we assume no duty and do not undertake to update the forward-looking statements. Because we are an investment company, the forward-looking statements and projections contained in this report are excluded from the safe harbor protection provided by Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the “Exchange Act”).

PART I. CONSOLIDATED FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Owl Rock Capital Corporation II

Consolidated Statements of Assets and Liabilities

(Amounts in thousands, except share and per share amounts)


	March 31, 2022 (Unaudited)			December 31, 2021
Assets
Investments at fair value
Non-controlled, non-affiliated investments (amortized cost of $2,366,121 and $2,387,782 respectively)	$	2,370,791		$	2,406,130
Non-controlled, affiliated investments (amortized cost of $13,923 and $13,418, respectively)		13,895			13,398
Total investments at fair value (amortized cost of $2,380,044 and $2,401,200, respectively)		2,384,686			2,419,528
Cash		35,803			52,294
Foreign cash (cost of $1,221 and $1,833, respectively)		1,173			1,773
Interest receivable		17,640			15,187
Receivable for investments sold		—			11,623
Prepaid expenses and other assets		1,554			743
Total Assets	$	2,440,856		$	2,501,148
Liabilities
Debt (net of deferred unamortized debt issuance costs of $4,234 and $3,237, respectively)	$	1,067,993		$	1,113,945
Payables to affiliates		14,423			16,943
Accrued expenses and other liabilities		16,472			10,569
Total Liabilities		1,098,888			1,141,457
Commitments and contingencies (Note 7)
Net Assets
Common shares $0.01 par value, 450,000,000 shares authorized; 150,818,035 and 151,376,519 shares issued and outstanding, respectively		1,508			1,514
Additional paid-in-capital		1,351,301			1,356,176
Distributable earnings		(10,841	)		2,001
Total Net Assets		1,341,968			1,359,691
Total Liabilities and Net Assets	$	2,440,856		$	2,501,148
Net Asset Value Per Share	$	8.90		$	8.98

________________

The accompanying notes are an integral part of these consolidated financial statements.

Owl Rock Capital Corporation II

Consolidated Statements of Operations

(Amounts in thousands, except share and per share amounts)

(Unaudited)


	For the Three Months Ended March 31,
	2022			2021
Investment Income
Investment income from non-controlled, non-affiliated investments:
Interest income(1)	$	40,863		$	39,486
Payment-in-kind interest income(1)		4,037			1,765
Dividend income		2,535			1,026
Other income		740			482
Total investment income from non-controlled, non-affiliated investments		48,175			42,759
Investment income from non-controlled, affiliated investments:
Interest income		184			160
Other Income		20			21
Total investment income from non-controlled, affiliated investments		204			181
Total Investment Income		48,379			42,940
Operating Expenses
Offering costs		—			385
Interest expense		10,257			8,520
Management fee		9,084			8,214
Performance based incentive fees		3,357			3,848
Professional fees		1,393			1,177
Directors' fees		314			261
Other general and administrative		721			611
Total Operating Expenses		25,126			23,016
Expense support		—			(1,449	)
Net Operating Expenses		25,126			21,567
Net Investment Income (Loss) Before Taxes		23,253			21,373
Income tax expense (benefit), including excise tax expense (benefit)		269			311
Net Investment Income (Loss)	$	22,984		$	21,062
Net Realized and Change in Unrealized Gain (Loss)
Net change in unrealized gain (loss):
Non-controlled, non-affiliated investments	$	(12,292	)	$	12,226
Non-controlled, affiliated investments		(8	)		37
Income tax (provision) benefit		—			(878	)
Translation of assets and liabilities in foreign currencies		(1,419	)		(551	)
Total Net Change in Unrealized Gain (Loss)		(13,719	)		10,834
Net realized gain (loss):
Non-controlled, non-affiliated investments		795			197
Foreign currency transactions		(55	)		170
Total Net Realized Gain (Loss)		740			367
Total Net Realized and Change in Unrealized Gain (Loss)		(12,979	)		11,201
Net Increase (Decrease) in Net Assets Resulting from Operations	$	10,005		$	32,263
Earnings Per Share - Basic and Diluted	$	0.07		$	0.22
Weighted Average Shares Outstanding - Basic and Diluted		151,788,770			149,144,175

________________

(1)

For the three months ended March 31, 2021, interest income and payment-in-kind interest income were reported in aggregate as interest income.

The accompanying notes are an integral part of these consolidated financial statements.

Owl Rock Capital Corporation II

Consolidated Schedule of Investments

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units		Amortized Cost(4)(30)			Fair Value			Percentage of Net Assets
Debt Investments(5)
Advertising and media
Global Music Rights, LLC(7)(23)(24)	First lien senior secured loan	L + 5.75%	8/28/2028	$	935	$	918		$	916			0.1	%
Global Music Rights, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	8/27/2027		—		(2	)		(2	)		—	%
					935		916			914			0.1	%
Aerospace and defense
Aviation Solutions Midco, LLC (dba STS Aviation)(7)(24)	First lien senior secured loan	L + 7.25%	1/3/2025		37,792		37,409			35,713			2.7	%
Peraton Corp.(6)(24)(25)	Second lien senior secured loan	L + 7.75%	2/1/2029		14,562		14,365			14,421			1.1	%
Valence Surface Technologies LLC(7)(23)(24)	First lien senior secured loan	L + 6.75% (incl. 1.00% PIK)	6/28/2025		30,700		30,432			27,170			2.0	%
Valence Surface Technologies LLC(7)(23)(24)(33)	First lien senior secured revolving loan	L + 6.75% (incl. 1.00% PIK)	6/28/2025		2,509		2,489			2,219			0.2	%
					85,563		84,695			79,523			6.0	%
Buildings and real estate
Associations, Inc.(7)(24)	First lien senior secured loan	L + 6.50% (incl. 2.50% PIK)	7/2/2027		80,471		79,766			79,467			5.9	%
Associations, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.50%	7/2/2027		—		(54	)		(77	)		—	%
REALPAGE, INC.(6)(23)(24)(25)	Second lien senior secured loan	L + 6.50%	4/23/2029		6,500		6,411			6,508			0.5	%
Reef Global Acquisition LLC (fka Cheese Acquisition, LLC)(8)(24)	First lien senior secured loan	L + 6.00% (incl. 1.25% PIK)	11/28/2024		18,708		18,640			17,820			1.3	%
Imperial Parking Canada(11)(24)	First lien senior secured loan	C + 6.00% (incl. 1.25% PIK)	11/28/2024		3,928		3,716			3,742			0.3	%
Reef Global Acquisition LLC (fka Cheese Acquisition, LLC)(6)(23)(24)(33)	First lien senior secured revolving loan	L + 4.75%	11/28/2023		1,396		1,398			1,288			0.1	%
					111,003		109,877			108,748			8.1	%
Business services
Access CIG, LLC(6)(24)	Second lien senior secured loan	L + 7.75%	2/27/2026		24,564		24,487			24,317			1.8	%
CIBT Global, Inc.(7)(23)(24)(29)	First lien senior secured loan	L + 5.25% (incl. 4.25% PIK)	6/3/2024		151		109			91			—	%
CIBT Global, Inc.(15)(23)(24)(29)	Second lien senior secured loan	L + 7.75% PIK	12/1/2025		11,237		4,720			2,304			0.2	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Denali BuyerCo, LLC (dba Summit Companies)(7)(24)	First lien senior secured loan	L + 6.00%	9/15/2028	5,562	5,455	5,478	0.4	%
Denali BuyerCo, LLC (dba Summit Companies)(7)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 6.00%	9/15/2023	70	67	68	—	%
Denali BuyerCo, LLC (dba Summit Companies)(7)(23)(24)(33)	First lien senior secured revolving loan	L + 6.00%	9/15/2027	33	32	31	—	%
Diamondback Acquisition, Inc. (dba Sphera)(7)(23)(24)	First lien senior secured loan	L + 5.50%	9/13/2028	830	814	809	0.1	%
Diamondback Acquisition, Inc. (dba Sphera)(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 5.50%	9/13/2023	—	(2)	(2)	—	%
Entertainment Benefits Group, LLC(7)(24)	First lien senior secured loan	L + 5.75%	9/30/2025	20,916	20,726	20,915	1.6	%
Entertainment Benefits Group, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	9/30/2024	—	(21)	—	—	%
Gainsight, Inc.(7)(23)(24)	First lien senior secured loan	L + 6.75% PIK	7/30/2027	5,077	4,998	4,987	0.4	%
Gainsight, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	7/30/2027	—	(14)	(15)	—	%
Hercules Borrower, LLC (dba The Vincit Group)(7)(24)	First lien senior secured loan	L + 6.50%	12/15/2026	28,486	28,136	28,486	2.1	%
Hercules Borrower, LLC (dba The Vincit Group)(7)(23)(24)(33)	First lien senior secured revolving loan	L + 6.50%	12/15/2026	357	317	357	—	%
Hercules Buyer, LLC (dba The Vincit Group)(19)(23)(24)(26)	Unsecured notes	0.48% PIK	12/14/2029	820	820	820	0.1	%
KPSKY Acquisition, Inc. (dba BluSky)(6)(23)(24)	First lien senior secured loan	L + 5.50%	10/19/2028	893	876	871	0.1	%
KPSKY Acquisition, Inc. (dba BluSky)(12)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	P + 4.50%	10/19/2023	51	50	49	—	%
				99,047	91,570	89,566	6.8	%
Chemicals
Aruba Investments Holdings LLC (dba Angus Chemical Company)(7)(24)	Second lien senior secured loan	L + 7.75%	11/24/2028	22,500	22,209	22,444	1.7	%
Douglas Products and Packaging Company LLC(7)(24)	First lien senior secured loan	L + 5.75%	10/19/2022	19,505	19,475	19,310	1.4	%
Douglas Products and Packaging Company LLC(12)(24)(33)	First lien senior secured revolving loan	P + 4.75%	10/19/2022	773	761	747	0.1	%
Gaylord Chemical Company, L.L.C.(7)(24)	First lien senior secured loan	L + 6.50%	3/30/2027	30,087	29,828	29,862	2.2	%
Gaylord Chemical Company, L.L.C.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.50%	3/30/2026	—	(21)	(20)	—	%
Velocity HoldCo III Inc. (dba VelocityEHS)(7)(23)(24)	First lien senior secured loan	L + 5.75%	4/22/2027	6,086	5,967	5,949	0.4	%
Velocity HoldCo III Inc. (dba VelocityEHS)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	4/22/2026	—	(7)	(8)	—	%
				78,951	78,212	78,284	5.8	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Consumer products
Conair Holdings, LLC(7)(24)	Second lien senior secured loan	L + 7.50%	5/17/2029	45,000	44,329	44,663	3.3	%
Feradyne Outdoors, LLC(6)(23)(24)	First lien senior secured loan	L + 6.25%	5/25/2023	750	748	750	0.1	%
Foundation Consumer Brands, LLC(7)(23)(24)	First lien senior secured loan	L + 5.50%	2/12/2027	1,000	1,000	1,000	0.1	%
Lignetics Investment Corp.(7)(24)	First lien senior secured loan	L + 6.00%	11/1/2027	9,779	9,663	9,559	0.7	%
Lignetics Investment Corp.(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 6.00%	11/1/2023	—	(14)	(28)	—	%
Lignetics Investment Corp.(7)(23)(24)(33)	First lien senior secured revolving loan	L + 6.00%	11/2/2026	417	400	384	—	%
SWK Buyer, Inc. (dba Stonewall Kitchen)(17)(23)(24)	First lien senior secured loan	SR + 5.25%	3/12/2029	754	740	739	0.1	%
SWK Buyer, Inc. (dba Stonewall Kitchen)(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	SR + 5.25%	3/11/2024	—	(2)	(2)	—	%
SWK Buyer, Inc. (dba Stonewall Kitchen)(12)(23)(24)(33)	First lien senior secured revolving loan	P + 4.25%	3/12/2029	7	6	6	—	%
WU Holdco, Inc. (dba Weiman Products, LLC)(7)(24)	First lien senior secured loan	L + 5.50%	3/26/2026	46,615	45,977	46,382	3.4	%
WU Holdco, Inc. (dba Weiman Products, LLC)(12)(23)(24)(33)	First lien senior secured revolving loan	P + 4.50%	3/26/2025	352	310	334	—	%
				104,674	103,157	103,787	7.7	%
Containers and packaging
Ascend Buyer, LLC (dba PPC Flexible Packaging)(7)(23)(24)	First lien senior secured loan	L + 5.75%	10/2/2028	770	763	759	0.1	%
Ascend Buyer, LLC (dba PPC Flexible Packaging)(6)(23)(24)(33)	First lien senior secured revolving loan	L + 5.75%	9/30/2027	13	12	12	—	%
Fortis Solutions Group, LLC(7)(23)(24)	First lien senior secured loan	L + 5.50%	10/13/2028	646	634	630	—	%
Fortis Solutions Group, LLC(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 5.50%	10/13/2023	—	(2)	(4)	—	%
Fortis Solutions Group, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.50%	10/15/2027	—	(2)	(2)	—	%
Pregis Topco LLC(6)(24)	Second lien senior secured loan	L + 7.14%	8/1/2029	30,000	29,526	29,770	2.2	%
				31,429	30,931	31,165	2.3	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Distribution
ABB/Con-cise Optical Group LLC(7)(23)(24)	First lien senior secured loan	L + 7.50%	2/23/2028	906	892	892	0.1	%
ABB/Con-cise Optical Group LLC(12)(23)(24)(33)	First lien senior secured revolving loan	P + 6.50%	2/23/2028	35	34	33	—	%
Aramsco, Inc.(6)(24)	First lien senior secured loan	L + 5.25%	8/28/2024	10,275	10,174	10,249	0.8	%
Aramsco, Inc.(6)(23)(24)(33)	First lien senior secured revolving loan	L + 5.25%	8/28/2024	708	697	705	0.1	%
Endries Acquisition, Inc.(7)(24)	First lien senior secured loan	L + 6.25%	12/10/2025	22,183	21,956	22,183	1.7	%
Individual Foodservice Holdings, LLC(8)(24)	First lien senior secured loan	L + 6.25%	11/21/2025	39,773	39,242	39,474	2.9	%
Individual Foodservice Holdings, LLC(6)(23)(24)(33)	First lien senior secured revolving loan	L + 6.25%	11/22/2024	805	754	771	0.1	%
Offen, Inc.(6)(24)	First lien senior secured loan	L + 5.00%	6/22/2026	4,684	4,654	4,684	0.3	%
				79,369	78,403	78,991	6.0	%
Education
Learning Care Group (US) No. 2 Inc.(7)(24)	Second lien senior secured loan	L + 7.50%	3/13/2026	5,393	5,335	5,259	0.4	%
Pluralsight, LLC(8)(24)	First lien senior secured loan	L + 8.00%	4/6/2027	20,641	20,440	20,383	1.5	%
Pluralsight, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 8.00%	4/6/2027	—	(11)	(16)	—	%
				26,034	25,764	25,626	1.9	%
Financial services
AxiomSL Group, Inc.(7)(24)	First lien senior secured loan	L + 6.00%	12/3/2027	43,347	42,906	42,697	3.2	%
AxiomSL Group, Inc.(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 6.00%	7/21/2023	—	(10)	(11)	—	%
AxiomSL Group, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	12/3/2025	—	(32)	(52)	—	%
Blackhawk Network Holdings, Inc.(6)(24)	Second lien senior secured loan	L + 7.00%	6/15/2026	18,777	18,683	18,683	1.4	%
Hg Genesis 8 Sumoco Limited(10)(21)(23)(24)	Unsecured facility	SA + 7.50% PIK	8/28/2025	6,012	6,044	5,998	0.4	%
Hg Genesis 9 SumoCo Limited(13)(21)(23)(24)	Unsecured Facility	E + 7.00% PIK	3/10/2027	1,001	988	994	0.1	%
Hg Saturn Luchaco Limited(8)(21)(23)(24)	Unsecured facility	L + 7.50% PIK	3/30/2026	27,063	28,154	26,725	2.0	%
Muine Gall, LLC(8)(21)(23)(24)	First lien senior secured loan	L + 7.00% PIK	9/20/2024	51,042	51,174	50,914	3.7	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
NMI Acquisitionco, Inc. (dba Network Merchants)(6)(24)	First lien senior secured loan	L + 5.75%	9/8/2025	3,334	3,315	3,293	0.2	%
NMI Acquisitionco, Inc. (dba Network Merchants)(6)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 5.75%	10/2/2023	656	643	645	—	%
NMI Acquisitionco, Inc. (dba Network Merchants)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	9/8/2025	—	(2)	(3)	—	%
Smarsh Inc.(16)(23)(24)	First lien senior secured loan	SR + 6.50%	2/16/2029	762	754	754	0.1	%
Smarsh Inc.(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	SR + 6.50%	2/18/2024	—	(1)	—	—	%
Smarsh Inc.(23)(24)(33)	First lien senior secured revolving loan	SR + 6.50%	2/16/2029	—	—	—	—	%
				151,994	152,616	150,637	11.1	%
Food and beverage
Balrog Acquisition, Inc. (dba Bakemark)(7)(23)(24)	Second lien senior secured loan	L + 7.00%	9/3/2029	5,000	4,960	4,938	0.4	%
BP Veraison Buyer, LLC (dba Sun World)(7)(24)	First lien senior secured loan	L + 5.75%	5/12/2027	14,485	14,329	14,268	1.1	%
BP Veraison Buyer, LLC (dba Sun World)(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 5.75%	5/12/2023	—	(6)	(23)	—	%
BP Veraison Buyer, LLC (dba Sun World)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	5/12/2027	—	(19)	(27)	—	%
H-Food Holdings, LLC(6)(24)(25)	First lien senior secured loan	L + 4.00%	5/23/2025	1	1	1	—	%
H-Food Holdings, LLC(6)(24)	Second lien senior secured loan	L + 7.00%	3/2/2026	18,200	17,933	17,654	1.3	%
Hometown Food Company(6)(24)	First lien senior secured loan	L + 5.00%	8/31/2023	1,695	1,684	1,678	0.1	%
Hometown Food Company(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.00%	8/31/2023	—	(3)	(5)	—	%
Innovation Ventures HoldCo, LLC(16)(23)(24)	First lien senior secured loan	SR + 6.00%	3/11/2027	600	591	591	—	%
Innovation Ventures HoldCo, LLC(18)(23)(24)(33)	First lien senior secured delayed draw term loan	SR + 6.00%	9/30/2022	—	—	—	—	%
Innovation Ventures HoldCo, LLC(18)(23)(24)(33)	First lien senior secured delayed draw term loan	SR + 6.00%	5/14/2022	—	—	—	—	%
Nellson Nutraceutical, LLC(7)(24)	First lien senior secured loan	L + 5.25%	12/23/2023	27,208	26,597	26,596	2.0	%
Nutraceutical International Corporation(6)(24)	First lien senior secured loan	L + 7.00%	9/30/2026	36,471	36,040	35,468	2.6	%
Nutraceutical International Corporation(6)(23)(24)	First lien senior secured revolving loan	L + 7.00%	9/30/2025	2,353	2,328	2,288	0.2	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(6)(24)	First lien senior secured loan	L + 4.50%	7/30/2025	4,861	4,811	4,569	0.3	%
Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(6)(23)(24)(33)	First lien senior secured revolving loan	L + 4.50%	7/30/2023	227	221	167	—	%
Shearer's Foods, LLC(6)(24)	Second lien senior secured loan	L + 7.75%	9/22/2028	50,000	49,576	49,749	3.7	%
Ultimate Baked Goods Midco, LLC(7)(24)	First lien senior secured loan	L + 6.25%	8/13/2027	16,459	16,081	15,964	1.2	%
Ultimate Baked Goods Midco, LLC(8)(23)(24)(33)	First lien senior secured revolving loan	L + 6.25%	8/13/2027	1,250	1,205	1,190	0.1	%
				178,810	176,329	175,066	13.0	%
Healthcare equipment and services
Confluent Medical Technologies, Inc.(17)(23)(24)	Second lien senior secured loan	SR + 6.50%	2/18/2030	1,000	980	980	0.1	%
CSC Mkg Topco LLC (dba Medical Knowledge Group)(6)(23)(24)	First lien senior secured loan	L + 5.75%	2/1/2029	854	837	837	0.1	%
CSC Mkg Topco LLC (dba Medical Knowledge Group)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	2/1/2029	—	(2)	(2)	—	%
Nelipak Holding Company(7)(24)	First lien senior secured loan	L + 4.25%	7/2/2026	2,946	2,908	2,895	0.2	%
Nelipak Holding Company(7)(23)(24)(33)	First lien senior secured revolving loan	L + 4.25%	7/2/2024	368	360	352	—	%
Nelipak Holding Company(23)(24)(33)(34)	First lien senior secured revolving loan	E + 4.50%	7/2/2024	—	(30)	(15)	—	%
Nelipak Holding Company(7)(24)	Second lien senior secured loan	L + 8.25%	7/2/2027	7,994	7,906	7,874	0.6	%
Nelipak Holding Company(14)(23)(24)	Second lien senior secured loan	E + 8.50%	7/2/2027	7,978	7,937	7,818	0.6	%
Packaging Coordinators Midco, Inc.(7)(24)	Second lien senior secured loan	L + 7.00%	12/13/2029	37,269	36,599	36,337	2.7	%
Patriot Acquisition TopCo S.A.R.L (dba Corza Health, Inc.) (6)(24)	First lien senior secured loan	L + 6.75%	1/31/2028	25,716	25,334	25,331	1.9	%
Patriot Acquisition TopCo S.A.R.L (dba Corza Health, Inc.) (23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.75%	1/29/2026	—	(42)	(40)	—	%
Rhea Parent, Inc.(16)(23)(24)	First lien senior secured loan	SR + 5.75%	2/19/2029	774	759	758	0.1	%
				84,899	83,546	83,125	6.3	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Healthcare providers and services
Diagnostic Service Holdings, Inc.(6)(23)(24)	First lien senior secured loan	L + 5.50%	3/17/2025	1,000	1,000	1,000	0.1	%
KS Management Services, L.L.C.(6)(24)	First lien senior secured loan	L + 4.25%	1/9/2026	48,875	48,468	48,875	3.6	%
National Dentex Labs LLC (fka Barracuda Dental LLC)(7)(24)	First lien senior secured loan	L + 7.00%	10/27/2025	12,933	12,762	12,707	0.9	%
National Dentex Labs LLC (fka Barracuda Dental LLC)(7)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 7.00%	6/30/2022	6,507	6,436	6,389	0.5	%
National Dentex Labs LLC (fka Barracuda Dental LLC)(7)(23)(24)(33)	First lien senior secured revolving loan	L + 7.00%	10/27/2025	1,245	1,212	1,215	0.1	%
Natural Partners, LLC(6)(21)(23)(24)	First lien senior secured loan	L + 6.00%	11/29/2027	931	913	913	0.1	%
Natural Partners, LLC(21)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	11/29/2027	—	(1)	(1)	—	%
OB Hospitalist Group, Inc.(6)(23)(24)	First lien senior secured loan	L + 5.50%	9/27/2027	22,551	22,132	21,987	1.6	%
OB Hospitalist Group, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.50%	9/27/2027	—	(54)	(73)	—	%
Ex Vivo Parent Inc. (dba OB Hospitalist)(7)(23)(24)	First lien senior secured loan	L + 9.50% PIK	9/27/2028	11,184	10,972	10,933	0.8	%
Phoenix Newco, Inc. (dba Parexel)(6)(23)(24)	Second lien senior secured loan	L + 6.50%	11/15/2029	35,000	34,663	34,475	2.5	%
Premier Imaging, LLC (dba LucidHealth)(6)(24)	First lien senior secured loan	L + 6.00%	1/2/2025	7,588	7,509	7,511	0.6	%
Quva Pharma, Inc.(7)(24)	First lien senior secured loan	L + 5.50%	4/12/2028	11,759	11,446	11,377	0.8	%
Quva Pharma, Inc.(8)(23)(24)(33)	First lien senior secured revolving loan	L + 5.50%	4/10/2026	331	302	293	—	%
TC Holdings, LLC (dba TrialCard)(7)(24)	First lien senior secured loan	L + 4.50%	11/14/2023	18,132	18,039	18,132	1.4	%
TC Holdings, LLC (dba TrialCard)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 4.50%	11/14/2022	—	(7)	—	—	%
Vermont Aus Pty Ltd(16)(21)(23)(24)	First lien senior secured loan	SR + 5.50%	3/22/2028	1,000	975	975	0.1	%
				179,036	176,767	176,708	13.1	%
Healthcare technology
BCPE Osprey Buyer, Inc. (dba PartsSource)(8)(23)(24)	First lien senior secured loan	L + 5.75%	8/23/2028	602	593	590	—	%
BCPE Osprey Buyer, Inc. (dba PartsSource)(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 5.75%	8/23/2023	—	(2)	(3)	—	%
BCPE Osprey Buyer, Inc. (dba PartsSource)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	8/21/2026	—	(1)	(1)	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Bracket Intermediate Holding Corp.(7)(23)(24)(25)	First lien senior secured loan	L + 4.25%	9/5/2025	73	70	73	—	%
Bracket Intermediate Holding Corp.(7)(24)	Second lien senior secured loan	L + 8.13%	9/7/2026	3,750	3,702	3,713	0.3	%
GI Ranger Intermediate, LLC (dba Rectangle Health)(16)(23)(24)	First lien senior secured loan	SR + 6.00%	10/30/2028	924	906	903	0.1	%
GI Ranger Intermediate, LLC (dba Rectangle Health)(16)(23)(24)(33)	First lien senior secured revolving loan	SR + 6.00%	10/29/2027	7	6	6	—	%
Inovalon Holdings, Inc.(7)(24)	First lien senior secured loan	L + 6.25% (incl. 2.75% PIK)	11/24/2028	42,410	41,400	41,244	3.1	%
Inovalon Holdings, Inc.(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 5.75%	5/24/2024	—	(53)	(67)	—	%
Inovalon Holdings, Inc.(7)(23)(24)	Second lien senior secured loan	L + 10.50% PIK	11/24/2033	20,637	20,243	20,174	1.5	%
Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(7)(21)(23)(24)	First lien senior secured loan	L + 6.25%	8/21/2026	38,465	38,094	38,273	2.9	%
Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(7)(21)(23)(24)(33)	First lien senior secured revolving loan	L + 6.25%	8/21/2026	994	982	987	0.1	%
Interoperability Bidco, Inc. (dba Lyniate)(7)(23)(24)	First lien senior secured loan	L + 6.25%	12/24/2026	14,348	14,256	14,257	1.1	%
Interoperability Bidco, Inc. (dba Lyniate)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.25%	12/26/2024	—	(4)	(4)	—	%
RL Datix Holdings (USA), Inc.(8)(21)(23)(24)	First lien senior secured loan	L + 5.00%	4/28/2025	10,000	9,803	9,775	0.7	%
RL Datix Holdings (USA), Inc.(8)(21)(23)(24)	Second lien senior secured loan	L + 7.75%	4/27/2026	5,000	4,902	4,900	0.4	%
Datix Bidco Limited (dba RLDatix)(9)(21)(23)(24)	First lien senior secured loan	G + 4.50%	4/28/2025	839	861	821	0.1	%
Datix Bidco Limited (dba RLDatix)(9)(21)(23)(24)	Second lien senior secured loan	G + 7.75%	4/27/2026	2,194	2,251	2,150	0.2	%
				140,243	138,009	137,791	10.5	%
Household products
HGH Purchaser, Inc. (dba Horizon Services)(7)(24)	First lien senior secured loan	L + 5.75%	11/3/2025	26,989	26,681	26,719	2.0	%
HGH Purchaser, Inc. (dba Horizon Services)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 5.75%	11/3/2023	—	—	(20)	—	%
HGH Purchaser, Inc. (dba Horizon Services)(7)(23)(24)(33)	First lien senior secured revolving loan	L + 5.75%	11/3/2025	2,836	2,801	2,798	0.2	%
Walker Edison Furniture Company LLC(7)(24)	First lien senior secured loan	L + 8.75% (incl. 3.00% PIK)	3/31/2027	16,928	16,928	15,405	1.1	%
				46,753	46,410	44,902	3.3	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Human resource support services
Cornerstone OnDemand, Inc.(6)(23)(24)	Second lien senior secured loan	L + 6.50%	10/15/2029	16,667	16,427	16,333	1.2	%
IG Investments Holdings, LLC (dba Insight Global)(7)(23)(24)	First lien senior secured loan	L + 6.00%	9/22/2028	9,231	9,058	9,046	0.7	%
IG Investments Holdings, LLC (dba Insight Global)(12)(23)(24)(33)	First lien senior secured revolving loan	P + 5.00%	9/22/2027	145	131	130	—	%
				26,043	25,616	25,509	1.9	%
Infrastructure and environmental services
LineStar Integrity Services LLC(8)(24)	First lien senior secured loan	L + 7.25%	2/12/2024	12,954	12,927	11,528	0.9	%
Tamarack Intermediate, L.L.C.(16)(23)(24)	First lien senior secured loan	SR + 5.75%	3/13/2028	685	672	671	0.1	%
Tamarack Intermediate, L.L.C.(23)(24)(33)(34)	First lien senior secured revolving loan	SR + 5.75%	3/13/2028	—	(2)	(2)	—	%
				13,639	13,597	12,197	1.0	%
Insurance
Alera Group, Inc.(6)(24)	First lien senior secured loan	L + 5.50%	10/2/2028	9,686	9,476	9,420	0.7	%
Alera Group, Inc.(6)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 5.50%	10/2/2023	2,658	2,601	2,583	0.2	%
Ardonagh Midco 2 PLC(21)(23)(24)(26)	Unsecured notes	11.50%	1/15/2027	602	598	638	—	%
Ardonagh Midco 3 PLC(10)(21)(23)(24)	First lien senior secured GBP term loan	SA + 7.00%	7/14/2026	6,135	5,744	6,134	0.5	%
Ardonagh Midco 3 PLC(14)(21)(23)(24)	First lien senior secured EUR term loan	E + 7.00%	7/14/2026	546	539	545	—	%
Ardonagh Midco 3 PLC(8)(21)(23)(24)	First lien senior secured USD term loan	L + 5.75%	7/14/2026	1,440	1,414	1,429	0.1	%
Ardonagh Midco 3 PLC(18)(21)(23)(24)(33)	First lien senior secured GBP delayed draw term loan	G + 6.00%	8/19/2023	—	—	(5)	—	%
Brightway Holdings, LLC(6)(23)(24)	First lien senior secured loan	L + 6.50%	12/16/2027	4,474	4,420	4,407	0.3	%
Brightway Holdings, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.50%	12/16/2027	—	(6)	(8)	—	%
Evolution BuyerCo, Inc. (dba SIAA)(7)(24)	First lien senior secured loan	L + 6.25%	4/28/2028	29,730	29,349	29,283	2.2	%
Evolution BuyerCo, Inc. (dba SIAA)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.25%	4/30/2027	—	(27)	(33)	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Integrity Marketing Acquisition, LLC(8)(24)	First lien senior secured loan	L + 5.75%	8/27/2025	27,499	27,214	27,499	2.0	%
Integrity Marketing Acquisition, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	8/27/2025	—	(16)	—	—	%
Norvax, LLC (dba GoHealth)(7)(24)	First lien senior secured loan	L + 6.50%	9/15/2025	17,151	16,684	17,065	1.3	%
Norvax, LLC (dba GoHealth)(6)(23)(24)(33)	First lien senior secured revolving loan	L + 6.50%	9/13/2024	2,114	2,094	2,100	0.2	%
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)(7)(23)(24)	First lien senior secured loan	L + 6.00%	11/1/2028	22,825	22,615	22,483	1.7	%
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	11/1/2027	—	(10)	(16)	—	%
PCF Midco II, LLC (dba PCF Insurance Services)(23)(24)(26)	First lien senior secured loan	9.00% PIK	10/31/2031	22,233	20,247	19,843	1.5	%
TEMPO BUYER CORP. (dba Global Claims Services)(7)(23)(24)	First lien senior secured loan	L + 5.50%	8/28/2028	701	688	683	0.1	%
TEMPO BUYER CORP. (dba Global Claims Services)(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 5.50%	8/26/2023	—	(2)	(3)	—	%
TEMPO BUYER CORP. (dba Global Claims Services)(12)(23)(24)(33)	First lien senior secured revolving loan	P + 4.50%	8/26/2027	4	2	1	—	%
THG Acquisition, LLC (dba Hilb)(7)(24)	First lien senior secured loan	L + 5.75%	12/2/2026	25,107	24,656	24,730	1.7	%
THG Acquisition, LLC (dba Hilb)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	12/2/2025	—	(29)	(28)	—	%
USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(7)(23)(24)	First lien senior secured loan	L + 5.50%	7/23/2027	1,681	1,650	1,639	0.1	%
USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(7)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.50%	7/23/2027	3	—	(2)	—	%
KUSRP Intermediate, Inc. (dba U.S. Retirement and Benefits Partners)(7)(23)(24)	First lien senior secured loan	L + 9.50% PIK	7/24/2028	1,383	1,358	1,355	0.1	%
				175,972	171,259	171,742	12.7	%
Internet software and services
3ES Innovation Inc. (dba Aucerna)(7)(21)(24)	First lien senior secured loan	L + 6.75%	5/13/2025	10,783	10,694	10,621	0.8	%
3ES Innovation Inc. (dba Aucerna)(21)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.75%	5/13/2025	—	(4)	(10)	—	%
Apptio, Inc.(7)(23)(24)	First lien senior secured loan	L + 7.25%	1/10/2025	7,363	7,285	7,363	0.5	%
Apptio, Inc.(7)(23)(24)(33)	First lien senior secured revolving loan	L + 7.25%	1/10/2025	196	192	196	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Barracuda Networks, Inc.(7)(23)(24)	Second lien senior secured loan	L + 6.75%	10/30/2028	7,500	7,435	7,463	0.6	%
Bayshore Intermediate #2, L.P. (dba Boomi)(7)(23)(24)	First lien senior secured loan	L + 7.75% PIK	10/2/2028	15,205	14,888	14,825	1.1	%
Bayshore Intermediate #2, L.P. (dba Boomi)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.75%	10/1/2027	—	(26)	(31)	—	%
BCPE Nucleon (DE) SPV, LP(8)(23)(24)	First lien senior secured loan	L + 7.00%	9/24/2026	35,556	35,121	35,289	2.6	%
BCTO BSI Buyer, Inc. (dba Buildertrend)(7)(23)(24)	First lien senior secured loan	L + 7.00%	12/23/2026	8,482	8,412	8,419	0.6	%
BCTO BSI Buyer, Inc. (dba Buildertrend)(7)(23)(24)(33)	First lien senior secured revolving loan	L + 7.00%	12/23/2026	573	565	566	—	%
Centrify Corporation(7)(23)(24)	First lien senior secured loan	L + 5.75%	3/2/2028	13,171	12,882	12,875	1.0	%
Centrify Corporation(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	3/2/2027	—	(32)	(30)	—	%
CivicPlus, LLC(7)(23)(24)	First lien senior secured loan	L + 6.00%	8/24/2027	626	620	616	—	%
CivicPlus, LLC(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 6.00%	8/24/2023	—	—	(1)	—	%
CivicPlus, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	8/24/2027	—	(1)	(1)	—	%
Delta TopCo, Inc. (dba Infoblox, Inc.)(7)(24)	Second lien senior secured loan	L + 7.25%	12/1/2028	40,000	39,828	39,800	3.0	%
EET Buyer, Inc. (dba e-Emphasys)(8)(23)(24)	First lien senior secured loan	L + 5.75%	11/8/2027	909	901	895	0.1	%
EET Buyer, Inc. (dba e-Emphasys)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	11/8/2027	—	(1)	(1)	—	%
Forescout Technologies, Inc.(7)(23)(24)	First lien senior secured loan	L + 9.50% PIK	8/17/2026	7,351	7,265	7,351	0.5	%
Forescout Technologies, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 8.50%	8/18/2025	—	(8)	—	—	%
Genesis Acquisition Co. (dba Procare Software)(7)(24)	First lien senior secured loan	L + 4.00%	7/31/2024	2,009	1,992	1,949	0.1	%
Genesis Acquisition Co. (dba Procare Software)(7)(23)(24)	First lien senior secured revolving loan	L + 4.00%	7/31/2024	293	291	284	—	%
GovBrands Intermediate, Inc.(7)(23)(24)	First lien senior secured loan	L + 5.50%	8/4/2027	2,478	2,422	2,391	0.2	%
GovBrands Intermediate, Inc.(7)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 5.50%	8/4/2023	558	542	532	—	%
GovBrands Intermediate, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.50%	8/4/2027	—	(4)	(6)	—	%
H&F Opportunities LUX III S.À R.L (dba Checkmarx)(8)(21)(23)(24)	First lien senior secured loan	L + 7.50%	4/16/2026	14,545	14,227	14,545	1.1	%
H&F Opportunities LUX III S.À R.L (dba Checkmarx)(21)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 7.50%	4/16/2026	—	(93)	—	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Hyland Software, Inc.(6)(23)(24)	Second lien senior secured loan	L + 6.25%	7/7/2025	12,145	12,135	12,024	0.9	%
IQN Holding Corp. (dba Beeline)(8)(24)	First lien senior secured loan	L + 5.50%	8/20/2024	20,734	20,592	20,681	1.5	%
IQN Holding Corp. (dba Beeline)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.50%	8/21/2023	—	(11)	(7)	—	%
Litera Bidco LLC(6)(24)	First lien senior secured loan	L + 5.85%	5/29/2026	27,117	26,844	27,117	2.0	%
Litera Bidco LLC(6)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 6.00%	10/29/2022	352	342	352	—	%
Litera Bidco LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.75%	5/29/2026	—	(7)	—	—	%
MessageBird BidCo B.V.(8)(21)(24)	First lien senior secured loan	L + 6.75%	5/5/2027	16,000	15,690	15,640	1.2	%
MINDBODY, Inc.(8)(24)	First lien senior secured loan	L + 8.50% (incl. 1.50% PIK)	2/14/2025	11,890	11,822	11,890	0.9	%
MINDBODY, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 8.00%	2/14/2025	—	(5)	—	—	%
Ministry Brands Holdings, LLC(7)(23)(24)	First lien senior secured loan	L + 5.50%	12/29/2028	706	692	689	0.1	%
Ministry Brands Holdings, LLC(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 5.50%	12/27/2023	—	(2)	(3)	—	%
Ministry Brands Holdings, LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.50%	12/30/2027	—	(1)	(2)	—	%
Proofpoint, Inc.(7)(23)(24)(25)	Second lien senior secured loan	L + 6.25%	8/31/2029	4,900	4,877	4,871	0.4	%
QAD, Inc.(7)(23)(24)	First lien senior secured loan	L + 6.00%	11/5/2027	4,429	4,345	4,318	0.3	%
QAD, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	11/5/2027	—	(11)	(14)	—	%
Tahoe Finco, LLC(7)(21)(23)(24)	First lien senior secured loan	L + 6.00%	9/29/2028	23,256	23,036	22,907	1.7	%
Tahoe Finco, LLC(21)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	10/1/2027	—	(16)	(26)	—	%
Thunder Purchaser, Inc. (dba Vector Solutions)(7)(24)	First lien senior secured loan	L + 5.75%	6/30/2028	13,837	13,711	13,665	1.0	%
Thunder Purchaser, Inc. (dba Vector Solutions)(18)(23)(24)(33)	First lien senior secured delayed draw term loan	L + 5.75%	8/17/2023	—	—	(6)	—	%
Thunder Purchaser, Inc. (dba Vector Solutions)(7)(23)(24)(33)	First lien senior secured revolving loan	L + 5.75%	6/30/2027	141	134	131	—	%
When I Work, Inc.(7)(23)(24)	First lien senior secured loan	L + 7.00% PIK	11/2/2027	762	755	750	0.1	%
When I Work, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	11/2/2027	—	(1)	(2)	—	%
				303,867	300,314	300,875	22.3	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Leisure and entertainment
Troon Golf, L.L.C.(7)(24)	First lien senior secured loan	L + 6.00%	8/5/2027	61,179	60,901	60,873	4.5	%
Troon Golf, L.L.C.(6)(23)(24)(33)	First lien senior secured revolving loan	L + 6.00%	8/5/2026	878	858	855	0.1	%
				62,057	61,759	61,728	4.6	%
Manufacturing
Gloves Buyer, Inc. (dba Protective Industrial Products)(6)(23)(24)	Second lien senior secured loan	L + 8.25%	12/29/2028	6,300	6,160	6,206	0.5	%
Ideal Tridon Holdings, Inc.(7)(24)	First lien senior secured loan	L + 5.25%	7/31/2024	13,472	13,341	13,438	1.0	%
Ideal Tridon Holdings, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.25%	7/31/2023	—	(7)	(4)	—	%
MHE Intermediate Holdings, LLC (dba OnPoint Group)(8)(24)	First lien senior secured loan	L + 5.75%	7/21/2027	18,381	18,215	18,060	1.3	%
MHE Intermediate Holdings, LLC (dba OnPoint Group)(7)(18)(24)(33)	First lien senior secured delayed draw term loan	L + 5.75%	7/21/2023	1,539	1,524	1,503	0.1	%
MHE Intermediate Holdings, LLC (dba OnPoint Group)(6)(23)(24)(33)	First lien senior secured revolving loan	L + 5.75%	7/21/2027	71	56	40	—	%
PHM Netherlands Midco B.V. (dba Loparex)(6)(23)(24)	First lien senior secured loan	L + 4.50%	7/31/2026	196	185	190	—	%
PHM Netherlands Midco B.V. (dba Loparex)(6)(24)	Second lien senior secured loan	L + 8.75%	7/30/2027	28,000	26,531	27,230	2.0	%
Safety Products/JHC Acquisition Corp. (dba Justrite Safety Group)(6)(24)	First lien senior secured loan	L + 4.50%	6/28/2026	3,472	3,450	3,212	0.2	%
Sonny's Enterprises LLC(6)(24)	First lien senior secured loan	L + 6.75%	8/5/2026	44,727	44,101	44,727	3.2	%
Sonny's Enterprises LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.75%	8/5/2025	—	(35)	—	—	%
				116,158	113,521	114,602	8.3	%
Oil and gas
Black Mountain Sand Eagle Ford LLC(7)(23)(24)	First lien senior secured loan	L + 8.25%	8/17/2022	415	416	415	—	%
Project Power Buyer, LLC (dba PEC-Veriforce)(7)(24)	First lien senior secured loan	L + 6.00%	5/14/2026	7,937	7,865	7,937	0.6	%
Project Power Buyer, LLC (dba PEC-Veriforce)(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.00%	5/14/2025	—	(4)	—	—	%
Zenith Energy U.S. Logistics Holdings, LLC(7)(24)	First lien senior secured loan	L + 5.50%	12/20/2024	19,021	18,748	19,021	1.4	%
				27,373	27,025	27,373	2.0	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Professional services
AmSpec Group, Inc. (fka AmSpec Services Inc.)(7)(24)	First lien senior secured loan	L + 5.75%	7/2/2024	18,720	18,571	18,580	1.4	%
AmSpec Group, Inc. (fka AmSpec Services Inc.)(23)(24)(33)(34)	First lien senior secured revolving loan	P + 3.75%	7/2/2024	—	(16)	(18)	—	%
Apex Group Treasury, LLC(7)(21)(23)(24)	Second lien senior secured loan	L + 6.75%	7/27/2029	5,000	4,953	4,925	0.4	%
Apex Group Treasury, LLC(18)(21)(23)(24)(33)	Second lien senior secured delayed draw term loan	L + 6.75%	6/30/2022	—	—	—	—	%
Aptive Environmental, LLC(23)(24)(26)	First lien senior secured loan	12.00% (incl. 6.00% PIK)	1/23/2026	2,528	2,075	2,052	0.2	%
Gerson Lehrman Group, Inc.(7)(24)	First lien senior secured loan	L + 5.25%	12/12/2024	5,535	5,508	5,518	0.4	%
Gerson Lehrman Group, Inc.(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.25%	12/12/2024	—	(9)	(6)	—	%
Guidehouse Inc.(6)(23)(24)	First lien senior secured loan	L + 5.50%	10/16/2028	928	919	914	0.1	%
Relativity ODA LLC(6)(24)	First lien senior secured loan	L + 7.50% PIK	5/12/2027	15,827	15,631	15,589	1.1	%
Relativity ODA LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 6.50%	5/12/2027	—	(19)	(22)	—	%
				48,538	47,613	47,532	3.6	%
Specialty retail
Notorious Topco, LLC (dba Beauty Industry Group)(8)(24)	First lien senior secured loan	L + 6.50%	11/23/2027	24,305	23,957	23,880	1.8	%
Notorious Topco, LLC (dba Beauty Industry Group)(18)(23)(24)(33)(34)	First lien senior secured delayed draw term loan	L + 6.50%	11/23/2023	—	(21)	(18)	—	%
Notorious Topco, LLC (dba Beauty Industry Group)(7)(23)(24)(33)	First lien senior secured revolving loan	L + 6.50%	5/24/2027	563	534	525	—	%
Galls, LLC(7)(24)	First lien senior secured loan	L + 6.75% (incl. 0.50% PIK)	1/31/2025	17,051	16,935	15,857	1.2	%
Galls, LLC(7)(23)(24)(33)	First lien senior secured revolving loan	L + 6.75%	1/31/2024	2,924	2,877	2,554	0.2	%
Milan Laser Holdings LLC(7)(24)	First lien senior secured loan	L + 5.00%	4/27/2027	22,866	22,668	22,638	1.7	%
Milan Laser Holdings LLC(23)(24)(33)(34)	First lien senior secured revolving loan	L + 5.00%	4/27/2026	—	(16)	(20)	—	%
The Shade Store, LLC(7)(23)(24)	First lien senior secured loan	L + 6.00%	10/13/2027	2,267	2,241	2,227	0.2	%
The Shade Store, LLC(8)(23)(24)(33)	First lien senior secured revolving loan	L + 6.00%	10/13/2026	114	111	110	—	%
				70,090	69,286	67,753	5.1	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units		Amortized Cost(4)(30)		Fair Value		Percentage of Net Assets
Transportation
Lazer Spot G B Holdings, Inc.(8)(24)	First lien senior secured loan	L + 5.75%	12/9/2025		40,388		39,925		40,388		3.0	%
Lazer Spot G B Holdings, Inc.(12)(23)(24)(33)	First lien senior secured revolving loan	P + 4.75%	12/9/2025		453		372		453		—	%
Lytx, Inc.(6)(23)(24)	First lien senior secured loan	L + 6.75%	2/28/2026		23,850		23,594		23,612		1.8	%
Motus Group, LLC(7)(23)(24)	Second lien senior secured loan	L + 6.50%	12/10/2029		3,615		3,580		3,570		0.3	%
					68,306		67,471		68,023		5.1	%
Total non-controlled/non-affiliated portfolio company debt investments				$	2,310,783	$	2,274,663	$	2,262,167		168.6	%
Equity Investments
Automotive
CD&R Value Building Partners I, L.P. (dba Belron)(21)(23)(24)(27)(32)	LP Interest	N/A	N/A		1,002		1,002		1,000		0.1	%
Metis HoldCo, Inc. (dba Mavis Tire Express Services)(23)(24)(26)(27)	Series A Convertible Preferred Stock	7.00% PIK	N/A		32,308		33,404		33,718		2.5	%
							34,406		34,718		2.6	%
Buildings and real estate
Dodge Construction Network Holdings, L.P.(23)(24)(27)(32)	Class A-2 Common Units	N/A	N/A		431,889		368		367		—	%
Dodge Construction Network Holdings, L.P.(23)(24)(26)(27)	Series A Preferred Units	8.25% PIK	N/A		0.01		9		9		—	%
							377		376		—	%
Business Services
Denali Holding, LP (dba Summit Companies)(23)(24)(27)(32)	Class A Units	N/A	N/A		39,300		393		393		—	%
Hercules Buyer LLC (dba The Vincit Group)(19)(23)(24)(27)(32)	Common Units	N/A	N/A		352		350		350		—	%
							743		743		—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Consumer Products
ASP Conair Holdings LP(23)(24)(27)(32)	Class A Units	N/A	N/A	12,857	1,286	1,286	0.1	%
					1,286	1,286	0.1	%
Food and beverage
H-Food Holdings, LLC(23)(24)(27)(32)	LLC Interest	N/A	N/A	1,625	1,625	1,832	0.1	%
					1,625	1,832	0.1	%
Healthcare equipment and services
KPCI Holdings, L.P.(23)(24)(27)(32)	Class A Units	N/A	N/A	6,014	6,014	6,472	0.5	%
Maia Aggregator, LP(23)(24)(27)(32)	Class A-2 Units	N/A	N/A	112	112	112	—	%
Patriot Holdings SCSp (dba Corza Health, Inc.)(23)(24)(26)(27)	Class A Units	8.00% PIK	N/A	1,370	1,503	1,503	0.1	%
Patriot Holdings SCSp (dba Corza Health, Inc.)(23)(24)(27)(32)	Class B Units	N/A	N/A	18,864	—	214	—	%
Rhea Acquisition Holdings, LP(23)(24)(27)(32)	Series A-2 Units	N/A	N/A	119	119	119	—	%
					7,748	8,420	0.6	%
Healthcare providers and services
KOBHG Holdings L.P. (dba OB Hospitalist)(23)(24)(27)(32)	Class A Interests	N/A	N/A	1,291	1,291	1,291	0.1	%
					1,291	1,291	0.1	%
Healthcare technology
Minerva Holdco, Inc(23)(24)(26)(27)	Series A Preferred Stock	10.75% PIK	N/A	1	994	993	0.1	%
					994	993	0.1	%
Human resource support services
Sunshine Software Holdings, Inc. (dba Cornerstone OnDemand)(23)(24)(26)(27)	Series A Preferred Stock	10.50% PIK	N/A	700	5,491	5,398	0.4	%
					5,491	5,398	0.4	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units		Amortized Cost(4)(30)		Fair Value		Percentage of Net Assets
Insurance
Evolution Parent, LP (dba SIAA)(23)(24)(27)(32)	LP Interest	N/A	N/A		892		892		892		0.1	%
GoHealth, Inc. (20)(23)(24)(32)	Common Stock	N/A	N/A		227,097		1,163		268		—	%
GrowthCurve Capital Sunrise Co-Invest LP (dba Brightway)(23)(24)(27)(32)	LP Interest	N/A	N/A		106		106		105		—	%
PCF Holdco, LLC (dba PCF Insurance Services)(23)(24)(27)(32)	Class A Units	N/A	N/A		4,661		4,661		5,714		0.4	%
PCF Holdco, LLC (dba PCF Insurance Services)(23)(24)(27)(32)	Class A Warrants	N/A	N/A		1,714		1,714		2,103		0.2	%
							8,536		9,082		0.7	%
Internet software and services
BCTO WIW Holdings, Inc. (dba When I Work)(23)(24)(27)(32)	Class A Common Stock	N/A	N/A		3,000		300		300		—	%
Brooklyn Lender Co-Invest 2, L.P. (dba Boomi)(23)(24)(27)(32)	LP Common Units	N/A	N/A		1,345,119		1,345		1,345		0.1	%
MessageBird Holding B.V.(21)(23)(24)(27)(32)	Extended Series C Warrants	N/A	N/A		25,540		157		101		—	%
Thunder Topco L.P. (dba Vector Solutions)(23)(24)(27)(32)	Common Units	N/A	N/A		820		820		874		0.1	%
VEPF Torreys Aggregator, LLC (dba MINDBODY, Inc.)(23)(24)(26)(27)	Series A Preferred Stock	6.00% PIK	N/A		3,750		3,807		3,750		0.3	%
WMC Bidco, Inc. (dba West Monroe)(23)(24)(26)(27)	Senior Preferred Stock	11.25% PIK	N/A		2,321		2,430		2,391		0.2	%
							8,859		8,761		0.7	%
Manufacturing
Gloves Holdings, LP (dba Protective Industrial Products)(23)(24)(27)(32)	LP Interest	N/A	N/A		700		700		784		0.1	%
Windows Entities(21)(23)(24)(27)(28)	LLC Interest	N/A	N/A		10		18,982		34,520		2.6	%
							19,682		35,304		2.7	%
Professional Services
Evology, LLC(23)(24)(27)(32)	Class B Units	N/A	N/A		88		420		420		—	%
							420		420		—	%
Total non-controlled/non-affiliated portfolio company equity investments						$	91,458	$	108,624		8.1	%
Total non-controlled/non-affiliated portfolio company investments						$	2,366,121	$	2,370,791		176.7	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units		Amortized Cost(4)(30)		Fair Value		Percentage of Net Assets
Non-controlled/affiliated portfolio company investments
Debt Investments
Advertising and media
Swipe Acquisition Corporation (dba PLI)(6)(23)(24)(31)	First lien senior secured loan	L + 8.00%	6/29/2024		6,205		6,123		6,128		0.5	%
Swipe Acquisition Corporation (dba PLI)(6)(18)(23)(24)(31)(33)	First lien senior secured delayed draw term loan	L + 8.00%	12/30/2022		1,848		1,848		1,815		0.1	%
Swipe Acquisition Corporation (dba PLI)(23)(24)(31)(33)	Letter of Credit	L + 8.00%	6/29/2024		—		—		—		—	%
					8,053		7,971		7,943		0.6	%
Total non-controlled/affiliated portfolio company debt investments				$	8,053	$	7,971	$	7,943		0.6	%

Equity Investments
Advertising and media
New PLI Holdings, LLC (dba PLI)(23)(24)(27)(31)(32)	Class A Common Units	N/A	N/A		10,755		5,952		5,952		0.4	%
							5,952		5,952		0.4	%
Total non-controlled/affiliated portfolio company equity investments						$	5,952	$	5,952		0.4	%
Total non-controlled/affiliated portfolio company investments						$	13,923	$	13,895		1.0	%
Total Investments						$	2,380,044	$	2,384,686		177.7	%

________________

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

(2)

Unless otherwise indicated, all investments are non-controlled, non-affiliated investments. Non-controlled, non-affiliated investments are defined as investments in which the Company owns less than 5% of the portfolio company’s outstanding voting securities and does not have the power to exercise control over the management or policies of such portfolio company.

(3)

Unless otherwise indicated, all investments are considered Level 3 investments.

(4)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

(5)

Unless otherwise indicated, loan contains a variable rate structure, and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) (which can include one-, three-, six- or twelve-month LIBOR), Secured Overnight Financing Rate ("SOFR" or "SR," which can include one-, three- or six- month SOFR), Euro Interbank Offered Rate (“EURIBOR” or “E”, which can include one-, two-, three- or six-month EURIBOR), British pound sterling LIBOR (“GBPLIBOR” or “G”), SONIA ("SONIA" or "SA") or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option, and which reset periodically based on the terms of the loan agreement.

(6)

The interest rate on these loans is subject to 1 month LIBOR, which as of March 31, 2022 was 0.45%.

(7)

The interest rate on these loans is subject to 3 month LIBOR, which as of March 31, 2022 was 0.96%.

(8)

The interest rate on these loans is subject to 6 month LIBOR, which as of March 31, 2022 was 1.47%.

(9)

The interest rate on this loan is subject to 6 month GBPLIBOR, which as of March 31, 2022 was 1.47%.

(10)

The interest rate on this loan is subject to SONIA, which as of March 31, 2022 was 0.69%.

(11)

The interest rate on this loan is subject to 6 month Canadian Dollar Offered Rate (“CDOR” or “C”), which as of March 31, 2022 was 0.55%.

(12)

The interest rate on these loans is subject to Prime, which as of March 31, 2022 was 3.50%.

(13)

The interest rate on this loan is subject to 3 month EURIBOR, which as of March 31, 2022 was (0.46)%.

(14)

The interest rate on this loan is subject to 6 month EURIBOR, which as of March 31, 2022 was (0.37)%.

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)

(15)

The interest rate on these loans is subject to 12 month LIBOR, which as of March 31, 2022 was 2.10%.

(16)

The interest rate on this loan is subject to 3 month SOFR, which as of March 31, 2022 was 0.67%.

(17)

The interest rate on this loan is subject to 6 month SOFR, which as of March 31, 2022 was 1.07%.

(18)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

(19)

We invest in this portfolio company through underlying blocker entities Hercules Blocker 1 LLC, Hercules Blocker 2 LLC, Hercules Blocker 3 LLC, Hercules Blocker 4 LLC, and Hercules Blocker 5 LLC.

(20)

Level 1 investment.

(21)

This portfolio company is not a qualifying asset under Section 55(a) of the Investment Company Act of 1940, as amended (the “1940 Act”). Under the 1940 Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of total assets. As of March 31, 2022, non-qualifying assets represented 9.2% of total assets as calculated in accordance with the regulatory requirements.

(22)

Unless otherwise indicated, all or a portion of the Company’s portfolio companies are pledged as collateral supporting the available capacity under the SPV Asset Facilities. See Note 6 “Debt.”

(23)

Investment is not pledged as collateral for the credit facilities.

(24)

Represents co-investment made with the Company’s affiliates in accordance with the terms of exemptive relief that the Company received from the U.S. Securities and Exchange Commission. See Note 3 “Agreements and Related Party Transactions.”

(25)

Level 2 investment.

(26)

Investment does not contain a variable rate structure.

(27)

Securities acquired in transactions exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), and may be deemed to be “restricted securities” under the Securities Act. As of March 31, 2022, the aggregate fair value of these securities is $114.3 million, or 8.5% of the Company’s net assets. The acquisition dates of the restricted securities are as follows:


Portfolio Company	Investment	Acquisition Date
ASP Conair Holdings LP	Class A Units	May 17, 2021
BCTO WIW Holdings, Inc. (dba When I Work)	Class A Common Stock	November 2, 2021
Brooklyn Lender Co-Invest 2, L.P. (dba Boomi)	LP Common Units	October 1, 2021
CD&R Value Building Partners I, L.P. (dba Belron)	LP Interest	December 2, 2021
Denali Holding, LP (dba Summit Companies)	Class A Units	September 15, 2021
Dodge Construction Network Holdings, L.P.	Class A-2 Common Units	February 23, 2022
Dodge Construction Network Holdings, L.P.	Series A Preferred Units	February 23, 2022
Evology, LLC	Class B Units	January 24, 2022
Evolution Parent, LP (dba SIAA)	LP Interest	April 30, 2021
Gloves Holdings, LP (dba Protective Industrial Products)	LP Interest	December 29, 2020
GrowthCurve Capital Sunrise Co-Invest LP (dba Brightway)	LP Interest	December 16, 2021
Hercules Buyer LLC (dba The Vincit Group)	Common Units	December 15, 2020
H-Food Holdings, LLC	LLC Interest	November 23, 2018
KOBHG Holdings L.P. (dba OB Hospitalist)	Class A Interests	September 27, 2021
KPCI Holdings, L.P.	Class A Units	November 30, 2020
Maia Aggregator, LP	Class A-2 Units	February 1, 2022
MessageBird Holding B.V.	Extended Series C Warrants	May 5, 2021
Metis HoldCo, Inc. (dba Mavis Tire Express Services)	Series A Convertible Preferred Stock	May 4, 2021
Minerva Holdco, Inc	Series A Preferred Stock	February 15, 2022
New PLI Holdings, LLC (dba PLI)	Class A Common Units	December 23, 2020
Patriot Holdings SCSp (dba Corza Health, Inc.)	Class A Units	January 29, 2021
Patriot Holdings SCSp (dba Corza Health, Inc.)	Class B Units	January 29, 2021
PCF Holdco, LLC (dba PCF Insurance Services)	Class A Units	November 1, 2021
PCF Holdco, LLC (dba PCF Insurance Services)	Class A Warrants	November 1, 2021
Rhea Acquisition Holdings, LP	Series A-2 Units	February 18, 2022
Sunshine Software Holdings, Inc. (dba Cornerstone OnDemand)	Series A Preferred Stock	October 14, 2021
Thunder Topco L.P. (dba Vector Solutions)	Common Units	June 30, 2021
VEPF Torreys Aggregator, LLC (dba MINDBODY, Inc.)	Series A Preferred Stock	October 15, 2021
Windows Entities	LLC Interest	January 16, 2020
WMC Bidco, Inc. (dba West Monroe)	Senior Preferred Stock	November 9, 2021

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of March 31, 2022

(Amounts in thousands, except share amounts)

(Unaudited)

(28)

Investment represents multiple underlying investments, including Midwest Custom Windows, LLC, Greater Toronto Custom Windows, Corp., Garden State Custom Windows, LLC, Long Island Custom Windows, LLC, Jemico, LLC and Atlanta Custom Windows, LLC. Greater Toronto Custom Windows, Corp. is considered a non-qualifying asset, with a fair value of $2.7 million as of March 31, 2022.

(29)

Loan was on non-accrual status as of March 31, 2022.

(30)

As of March 31, 2022, the net estimated unrealized loss for U.S. federal income tax purposes was $12.3 million based on a tax cost basis of $2.4 billion. As of March 31, 2022, the estimated aggregate gross unrealized loss for U.S. federal income tax purposes was $39.2 million and the estimated aggregate gross unrealized gain for U.S. federal income tax purposes was $26.9 million.

(31)

Under the 1940 Act, the Company is deemed to be an “Affiliated Person” of, as defined in the 1940 Act, this portfolio company, as the Company owns more than 5% of the portfolio company’s outstanding voting securities. Transactions during the three months ended March 31, 2022 in which the Company was an Affiliated Person of the portfolio company are as follows:


Company	Fair Value at December 31, 2021		Gross Additions(a)		Gross Reductions(b)		Net Change in Unrealized Gain/(Loss)			Realized Gain/(Loss)		Transfers		Fair Value at March 31, 2022		Other Income		Interest Income
Swipe Acquisition Corporation (dba PLI)	$	13,398	$	505	$	—	$	(8	)	$	—	$	—	$	13,895	$	20	$	184
Total	$	13,398	$	505	$	—	$	(8	)	$	—	$	—	$	13,895	$	20	$	184

(a)

Gross additions may include increases in the cost basis of investments resulting from new investments, amounts related to payment-in-kind (“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 at fair value of an existing portfolio company into this controlled affiliated category from a different category.

(b)

Gross reductions may include decreases in the cost basis of investments resulting from principal collections related to investment repayments and sales, return of capital, the amortization of premiums and the exchange of one or more existing securities for one or more new securities.

(32)

Investment is non-income producing.

(33)

Position or portion thereof is an unfunded loan or equity commitment. See Note 7 “Commitments and Contingencies”.

(34)

The negative cost is the result of the capitalized discount being greater than the principal amount outstanding on the loan. The negative fair value is the result of the capitalized discount on the loan.

The accompanying notes are an integral part of these consolidated financial statements.

Owl Rock Capital Corporation II

Consolidated Schedule of Investments

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Debt Investments(5)
Advertising and media
Global Music Rights, LLC(8)(23)(24)	First lien senior secured loan	L + 5.75%	8/28/2028	$938	$919	$919	0.1	%
Global Music Rights, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	8/27/2027	—	(2)	(2)	—	%
				938	917	917	0.1	%
Aerospace and defense
Aviation Solutions Midco, LLC (dba STS Aviation)(8)(24)	First lien senior secured loan	L + 7.25%	1/3/2025	37,878	37,467	35,795	2.6	%
Peraton Corp.(6)(23)(24)	Second lien senior secured loan	L + 7.75%	2/1/2029	15,000	14,793	14,925	1.1	%
Valence Surface Technologies LLC(9)(24)	First lien senior secured loan	L + 6.75% (incl. 1.00% PIK)	6/28/2025	30,455	30,168	27,561	2.0	%
Valence Surface Technologies LLC(8)(16)(23)(24)	First lien senior secured revolving loan	L + 6.75% (incl. 1.00% PIK)	6/28/2025	2,496	2,474	2,258	0.2	%
				85,829	84,902	80,539	5.9	%
Buildings and real estate
Associations, Inc.(8)(24)	First lien senior secured loan	L + 6.50% (incl. 2.50% PIK)	7/2/2027	84,491	83,712	83,646	6.2	%
Associations, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.50%	7/2/2027	—	(56)	(61)	—	%
Dodge Data & Analytics LLC(9)(24)	First lien senior secured loan	L + 7.50%	4/14/2026	6,446	6,332	6,639	0.5	%
Dodge Data & Analytics LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 7.50%	4/14/2026	—	(6)	—	—	%
REALPAGE, INC.(6)(23)(24)	Second lien senior secured loan	L + 6.50%	4/23/2029	6,500	6,409	6,575	0.5	%
Reef Global Acquisition LLC (fka Cheese Acquisition, LLC)(9)(24)	First lien senior secured loan	L + 6.00% (incl. 1.25% PIK)	11/28/2024	18,692	18,600	17,852	1.3	%
Imperial Parking Canada(11)(24)	First lien senior secured loan	C + 6.00% (incl. 1.25% PIK)	11/28/2024	3,884	3,710	3,710	0.3	%
Reef Global Acquisition LLC (fka Cheese Acquisition, LLC)(6)(16)(23)(24)	First lien senior secured revolving loan	L + 4.75%	11/28/2023	1,526	1,525	1,424	0.1	%
				121,539	120,226	119,785	8.9	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Business services
Access CIG, LLC(6)(24)	Second lien senior secured loan	L + 7.75%	2/27/2026	24,564	24,484	24,441	1.8	%
CIBT Global, Inc.(8)(23)(24)(29)	First lien senior secured loan	L + 5.25% (incl. 4.25% PIK)	6/3/2024	151	111	94	—	%
CIBT Global, Inc.(8)(23)(24)(29)	Second lien senior secured loan	L + 7.75% (incl. 6.75% PIK)	12/1/2025	11,237	4,720	2,809	0.2	%
Denali BuyerCo, LLC (dba Summit Companies)(8)(24)	First lien senior secured loan	L + 6.00%	9/15/2028	6,398	6,277	6,334	0.5	%
Denali BuyerCo, LLC (dba Summit Companies)(8)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.00%	9/15/2023	104	100	103	—	%
Denali BuyerCo, LLC (dba Summit Companies)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	9/15/2027	—	(2)	(2)	—	%
Diamondback Acquisition, Inc. (dba Sphera)(8)(23)(24)	First lien senior secured loan	L + 5.50%	9/13/2028	832	816	815	0.1	%
Diamondback Acquisition, Inc. (dba Sphera)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.50%	9/13/2023	—	(2)	(2)	—	%
Entertainment Benefits Group, LLC(8)(24)	First lien senior secured loan	L + 8.25% (incl. 2.50% PIK)	9/30/2025	20,900	20,699	19,960	1.5	%
Entertainment Benefits Group, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 8.25% (incl. 2.50% PIK)	9/30/2024	—	(23)	(126)	—	%
Gainsight, Inc.(6)(23)(24)	First lien senior secured loan	L + 6.75% PIK	7/30/2027	5,077	4,995	5,001	0.4	%
Gainsight, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	7/30/2027	—	(14)	(13)	—	%
Hercules Borrower, LLC (dba The Vincit Group)(8)(24)	First lien senior secured loan	L + 6.50%	12/15/2026	28,558	28,191	28,558	2.1	%
Hercules Borrower, LLC (dba The Vincit Group)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.50%	12/15/2026	—	(41)	—	—	%
Hercules Buyer, LLC (dba The Vincit Group)(19)(23)(24)(26)	Unsecured notes	0.48% PIK	12/14/2029	820	820	820	0.1	%
KPSKY Acquisition, Inc. (dba BluSky)(6)(23)(24)	First lien senior secured loan	L + 5.50%	10/19/2028	895	878	877	0.1	%
KPSKY Acquisition, Inc. (dba BluSky)(12)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	P + 4.50%	10/19/2023	51	50	50	—	%
				99,587	92,059	89,719	6.8	%
Chemicals
Aruba Investments Holdings LLC (dba Angus Chemical Company)(9)(23)(24)	Second lien senior secured loan	L + 7.75%	11/24/2028	22,500	22,202	22,500	1.7	%
Douglas Products and Packaging Company LLC(8)(24)	First lien senior secured loan	L + 5.75%	10/19/2022	19,555	19,513	19,359	1.4	%
Douglas Products and Packaging Company LLC(12)(16)(24)	First lien senior secured revolving loan	P + 4.75%	10/19/2022	865	862	849	0.1	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Gaylord Chemical Company, L.L.C.(8)(24)	First lien senior secured loan	L + 6.50%	3/30/2027	30,163	29,894	30,013	2.2	%
Gaylord Chemical Company, L.L.C.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.50%	3/30/2026	—	(22)	(13)	—	%
Velocity HoldCo III Inc. (dba VelocityEHS)(8)(23)(24)	First lien senior secured loan	L + 5.75%	4/22/2027	6,101	5,977	5,979	0.4	%
Velocity HoldCo III Inc. (dba VelocityEHS)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	4/22/2026	—	(7)	(7)	—	%
				79,184	78,419	78,680	5.8	%
Consumer products
ConAir Holdings LLC(8)(24)	Second lien senior secured loan	L + 7.50%	5/17/2029	45,000	44,312	45,000	3.3	%
Feradyne Outdoors, LLC(8)(23)(24)	First lien senior secured loan	L + 6.25%	5/25/2023	753	750	753	0.1	%
Lignetics Investment Corp.(7)(24)	First lien senior secured loan	L + 6.00%	11/1/2027	9,804	9,684	9,681	0.7	%
Lignetics Investment Corp.(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.00%	11/1/2023	—	(15)	(15)	—	%
Lignetics Investment Corp.(8)(16)(23)(24)	First lien senior secured revolving loan	L + 6.00%	11/2/2026	245	227	227	—	%
Olaplex, Inc.(6)(24)	First lien senior secured loan	L + 6.25%	1/8/2026	12,104	12,004	12,104	0.9	%
WU Holdco, Inc. (dba Weiman Products, LLC)(8)(24)	First lien senior secured loan	L + 5.50%	3/26/2026	45,707	45,053	45,707	3.4	%
WU Holdco, Inc. (dba Weiman Products, LLC)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.50%	5/21/2022	—	(9)	—	—	%
WU Holdco, Inc. (dba Weiman Products, LLC)(8)(16)(23)(24)	First lien senior secured revolving loan	L + 5.50%	3/26/2025	1,057	1,011	1,057	0.1	%
				114,670	113,017	114,514	8.5	%
Containers and packaging
Ascend Buyer, LLC (dba PPC Flexible Packaging)(8)(23)(24)	First lien senior secured loan	L + 5.75%	10/2/2028	772	765	765	0.1	%
Ascend Buyer, LLC (dba PPC Flexible Packaging)(8)(16)(23)(24)	First lien senior secured revolving loan	L + 5.75%	9/30/2027	13	12	12	—	%
Fortis Solutions Group, LLC(8)(23)(24)	First lien senior secured loan	L + 5.50%	10/13/2028	648	635	635	—	%
Fortis Solutions Group, LLC(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.50%	10/13/2023	—	(3)	(3)	—	%
Fortis Solutions Group, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	10/15/2027	—	(2)	(2)	—	%
Pregis Topco LLC(8)(24)	Second lien senior secured loan	L + 7.14%	8/1/2029	30,000	29,515	30,000	2.2	%
				31,433	30,922	31,407	2.3	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Distribution
Aramsco, Inc.(6)(24)	First lien senior secured loan	L + 5.25%	8/28/2024	10,302	10,190	10,302	0.8	%
Aramsco, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.25%	8/28/2024	—	(12)	—	—	%
Endries Acquisition, Inc.(8)(24)	First lien senior secured loan	L + 6.25%	12/10/2025	22,240	22,000	22,240	1.6	%
Individual Foodservice Holdings, LLC(9)(24)	First lien senior secured loan	L + 6.25%	11/21/2025	32,735	32,270	32,571	2.4	%
Individual Foodservice Holdings, LLC(9)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.25%	6/30/2022	5,700	5,600	5,664	0.4	%
Individual Foodservice Holdings, LLC(6)(16)(23)(24)	First lien senior secured revolving loan	L + 6.25%	11/22/2024	201	146	178	—	%
Offen, Inc.(6)(24)	First lien senior secured loan	L + 5.00%	6/22/2026	4,895	4,863	4,895	0.4	%
				76,073	75,057	75,850	5.6	%
Education
Learning Care Group (US) No. 2 Inc.(8)(24)	Second lien senior secured loan	L + 7.50%	3/13/2026	5,393	5,332	5,259	0.4	%
Pluralsight, LLC(9)(24)	First lien senior secured loan	L + 8.00%	4/6/2027	20,641	20,440	20,434	1.5	%
Pluralsight, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 8.00%	4/6/2027	—	(11)	(13)	—	%
				26,034	25,761	25,680	1.9	%
Financial services
AxiomSL Group, Inc.(8)(24)	First lien senior secured loan	L + 6.00%	12/3/2027	43,456	42,998	43,130	3.2	%
AxiomSL Group, Inc.(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.00%	7/21/2023	—	(11)	—	—	%
AxiomSL Group, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	12/3/2025	—	(34)	(26)	—	%
Blackhawk Network Holdings, Inc.(6)(24)	Second lien senior secured loan	L + 7.00%	6/15/2026	18,777	18,679	18,777	1.4	%
Hg Genesis 8 Sumoco Limited(10)(21)(23)(24)	Unsecured facility	S + 7.50% PIK	8/28/2025	6,185	6,040	6,184	0.5	%
Hg Saturn Luchaco Limited(10)(21)(23)(24)	Unsecured facility	S + 7.50% PIK	3/30/2026	26,772	27,102	26,504	1.9	%
Muine Gall, LLC(9)(21)(23)(24)	First lien senior secured loan	L + 7.00% PIK	9/20/2024	51,042	51,113	51,042	3.8	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
NMI Acquisitionco, Inc. (dba Network Merchants)(6)(24)	First lien senior secured loan	L + 5.75%	9/8/2025	3,344	3,322	3,321	0.2	%
NMI Acquisitionco, Inc. (dba Network Merchants)(6)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.75%	10/2/2023	657	644	653	—	%
NMI Acquisitionco, Inc. (dba Network Merchants)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	9/8/2025	—	(2)	(2)	—	%
				150,233	149,851	149,583	11.0	%
Food and beverage
Balrog Acquisition, Inc. (dba BakeMark)(9)(23)(24)	Second lien senior secured loan	L + 7.00%	9/3/2029	5,000	4,959	4,958	0.4	%
BP Veraison Buyer, LLC (dba Sun World)(8)(24)	First lien senior secured loan	L + 5.75%	5/12/2027	14,522	14,357	14,377	1.1	%
BP Veraison Buyer, LLC (dba Sun World)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.75%	5/12/2023	—	(7)	—	—	%
BP Veraison Buyer, LLC (dba Sun World)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	5/12/2027	—	(20)	(18)	—	%
H-Food Holdings, LLC(6)(24)(25)	First lien senior secured loan	L + 4.00%	5/23/2025	1	1	1	—	%
H-Food Holdings, LLC(6)(24)	Second lien senior secured loan	L + 7.00%	3/2/2026	18,200	17,919	18,200	1.3	%
Hometown Food Company(6)(24)	First lien senior secured loan	L + 5.00%	8/31/2023	1,772	1,759	1,754	0.1	%
Hometown Food Company(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.00%	8/31/2023	—	(3)	(5)	—	%
Nellson Nutraceutical, LLC(8)(24)	First lien senior secured loan	L + 5.25%	12/23/2023	27,280	26,586	26,735	2.0	%
Nutraceutical International Corporation(6)(24)	First lien senior secured loan	L + 7.00%	9/30/2026	36,706	36,252	35,971	2.6	%
Nutraceutical International Corporation(6)(23)(24)	First lien senior secured revolving loan	L + 7.00%	9/30/2025	2,353	2,326	2,306	0.2	%
Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(6)(24)	First lien senior secured loan	L + 4.50%	7/30/2025	4,873	4,820	4,630	0.3	%
Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)(12)(16)(17)(23)(24)	First lien senior secured revolving loan	P + 3.50%	7/30/2023	33	26	(17)	—	%
Shearer's Foods, LLC(6)(24)	Second lien senior secured loan	L + 7.75%	9/22/2028	50,000	49,565	50,000	3.7	%
Ultimate Baked Goods Midco, LLC(6)(23)(24)	First lien senior secured loan	L + 6.25%	8/13/2027	16,500	16,110	16,088	1.2	%
Ultimate Baked Goods Midco, LLC(6)(16)(23)(24)	First lien senior secured revolving loan	L + 6.25%	8/13/2027	1,050	1,003	1,000	0.1	%
				178,290	175,653	175,980	13.0	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Healthcare equipment and services
Nelipak Holding Company(8)(24)	First lien senior secured loan	L + 4.25%	7/2/2026	2,954	2,913	2,917	0.2	%
Nelipak Holding Company(8)(16)(23)(24)	First lien senior secured revolving loan	L + 4.25%	7/2/2024	368	359	357	—	%
Nelipak Holding Company(16)(17)(23)(24)	First lien senior secured revolving loan	E + 4.50%	7/2/2024	—	(31)	(11)	—	%
Nelipak Holding Company(8)(24)	Second lien senior secured loan	L + 8.25%	7/2/2027	7,994	7,903	7,914	0.6	%
Nelipak Holding Company(13)(23)(24)	Second lien senior secured loan	E + 8.50%	7/2/2027	8,154	7,933	8,031	0.6	%
Packaging Coordinators Midco, Inc.(8)(24)	Second lien senior secured loan	L + 7.00%	11/30/2028	37,269	36,583	36,524	2.7	%
Patriot Acquisition TopCo S.A.R.L (dba Corza Health, Inc.) (7)(24)	First lien senior secured loan	L + 6.75%	1/31/2028	25,781	25,382	25,458	1.9	%
Patriot Acquisition TopCo S.A.R.L (dba Corza Health, Inc.) (16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.75%	1/29/2026	—	(45)	(33)	—	%
				82,520	80,997	81,157	6.0
Healthcare providers and services
KS Management Services, L.L.C.(9)(24)	First lien senior secured loan	L + 4.25%	1/9/2026	49,000	48,568	49,000	3.6	%
National Dentex Labs LLC (fka Barracuda Dental LLC)(8)(24)	First lien senior secured loan	L + 7.00%	10/3/2025	12,966	12,784	12,869	0.9	%
National Dentex Labs LLC (fka Barracuda Dental LLC)(8)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 7.00%	6/30/2022	6,523	6,447	6,474	0.5	%
National Dentex Labs LLC (fka Barracuda Dental LLC)(6)(16)(23)(24)	First lien senior secured revolving loan	L + 7.00%	10/3/2025	558	523	545	—	%
OB Hospitalist Group, Inc.(8)(23)(24)	First lien senior secured loan	L + 5.50%	9/27/2027	22,608	22,172	22,155	1.6	%
OB Hospitalist Group, Inc.(6)(16)(23)(24)	First lien senior secured revolving loan	L + 5.50%	9/27/2027	313	257	254	—	%
Ex Vivo Parent Inc. (dba OB Hospitalist)(8)(23)(24)	First lien senior secured loan	L + 9.50% PIK	9/27/2028	11,185	10,968	10,961	0.8	%
Phoenix Newco, Inc. (dba Parexel)(6)(23)(24)	Second lien senior secured loan	L + 6.50%	11/15/2029	35,000	34,654	34,650	2.5	%
Premier Imaging, LLC (dba LucidHealth)(6)(24)	First lien senior secured loan	L + 5.25%	1/2/2025	7,588	7,502	7,531	0.6	%
Quva Pharma, Inc.(8)(24)	First lien senior secured loan	L + 5.50%	4/12/2028	11,789	11,464	11,464	0.8	%
Quva Pharma, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	4/10/2026	—	(30)	(33)	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Refresh Parent Holdings, Inc.(8)(24)	First lien senior secured loan	L + 6.50%	12/9/2026	11,864	11,711	11,774	0.9	%
Refresh Parent Holdings, Inc.(8)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.50%	6/9/2022	3,795	3,746	3,766	0.3	%
Refresh Parent Holdings, Inc.(8)(16)(23)(24)	First lien senior secured revolving loan	L + 6.50%	12/9/2026	517	500	506	—	%
TC Holdings, LLC (dba TrialCard)(8)(24)	First lien senior secured loan	L + 4.50%	11/14/2023	18,178	18,071	18,178	1.3	%
TC Holdings, LLC (dba TrialCard)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 4.50%	11/14/2022	—	(10)	—	—	%
				191,884	189,327	190,094	13.8	%
Healthcare technology
BCPE Osprey Buyer, Inc. (dba PartsSource)(9)(23)(24)	First lien senior secured loan	L + 5.75%	8/23/2028	603	594	594	—	%
BCPE Osprey Buyer, Inc. (dba PartsSource)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.75%	8/23/2023	—	(2)	(2)	—	%
BCPE Osprey Buyer, Inc. (dba PartsSource)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	8/21/2026	—	(1)	(1)	—	%
Bracket Intermediate Holding Corp.(8)(23)(24)	First lien senior secured loan	L + 4.25%	9/5/2025	74	70	73	—	%
Bracket Intermediate Holding Corp.(8)(24)	Second lien senior secured loan	L + 8.13%	9/7/2026	3,750	3,699	3,731	0.3	%
GI Ranger Intermediate, LLC (dba Rectangle Health)(8)(23)(24)	First lien senior secured loan	L + 6.00%	10/30/2028	803	788	787	0.1	%
GI Ranger Intermediate, LLC (dba Rectangle Health)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.00%	10/30/2023	—	(1)	(1)	—	%
GI Ranger Intermediate, LLC (dba Rectangle Health)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	10/29/2027	—	(1)	(1)	—	%
Inovalon Holdings, Inc.(8)(23)(24)	First lien senior secured loan	L + 5.75%	11/24/2028	42,114	41,074	41,061	3.0	%
Inovalon Holdings, Inc.(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.75%	5/24/2024	—	(55)	(56)	—	%
Inovalon Holdings, Inc.(8)(23)(24)	Second lien senior secured loan	L + 10.50% PIK	11/24/2033	20,061	19,662	19,660	1.4	%
Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(8)(21)(24)	First lien senior secured loan	L + 6.25%	8/21/2026	38,561	38,173	38,465	2.8	%
Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)(8)(16)(21)(23)(24)	First lien senior secured revolving loan	L + 6.25%	8/21/2026	994	981	991	0.1	%
Interoperability Bidco, Inc.(9)(24)	First lien senior secured loan	L + 5.75%	6/25/2026	18,818	18,654	18,818	1.4	%
Interoperability Bidco, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	6/25/2024	—	(6)	—	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
RL Datix Holdings (USA), Inc.(9)(21)(23)(24)	First lien senior secured loan	L + 4.50%	4/28/2025	10,000	9,794	9,825	0.7	%
RL Datix Holdings (USA), Inc.(9)(21)(23)(24)	Second lien senior secured loan	L + 7.75%	4/27/2026	5,000	4,897	4,913	0.4	%
Datix Bidco Limited (dba RLDatix)(15)(21)(23)(24)	First lien senior secured loan	G + 4.50%	4/28/2025	863	860	848	0.1	%
Datix Bidco Limited (dba RLDatix)(15)(21)(23)(24)	Second lien senior secured loan	G + 7.75%	4/27/2026	2,257	2,248	2,218	0.2	%
				143,898	141,428	141,923	10.5	%
Household products
HGH Purchaser, Inc. (dba Horizon Services)(8)(24)	First lien senior secured loan	L + 5.75%	11/3/2025	27,057	26,729	26,854	2.0	%
HGH Purchaser, Inc. (dba Horizon Services)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.75%	11/3/2023	—	—	—	—	%
HGH Purchaser, Inc. (dba Horizon Services)(8)(16)(23)(24)	First lien senior secured revolving loan	L + 5.75%	11/3/2025	672	649	654	—	%
Walker Edison Furniture Company LLC(9)(24)	First lien senior secured loan	L + 8.75% (incl. 3.00% PIK)	3/31/2027	16,845	16,845	16,003	1.2	%
				44,574	44,223	43,511	3.2	%
Human resource support services
Cornerstone OnDemand, Inc.(9)(23)(24)	Second lien senior secured loan	L + 6.50%	10/15/2029	16,668	16,421	16,417	1.2	%
IG Investments Holdings, LLC (dba Insight Global)(8)(23)(24)	First lien senior secured loan	L + 6.00%	9/22/2028	9,254	9,075	9,092	0.7	%
IG Investments Holdings, LLC (dba Insight Global)(6)(16)(23)(24)	First lien senior secured revolving loan	L + 6.00%	9/22/2027	361	347	349	—	%
				26,283	25,843	25,858	1.9
Infrastructure and environmental services
LineStar Integrity Services LLC(9)(24)	First lien senior secured loan	L + 7.25%	2/12/2024	13,341	13,293	11,740	0.9	%
				13,341	13,293	11,740	0.9	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Insurance
Alera Group, Inc.(6)(23)(24)	First lien senior secured loan	L + 5.50%	10/2/2028	9,710	9,498	9,492	0.7	%
Alera Group, Inc.(6)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.50%	10/2/2023	2,668	2,608	2,607	0.2	%
Ardonagh Midco 2 PLC(21)(23)(24)(26)	Unsecured notes	12.75% PIK	1/15/2027	566	562	625	—	%
Ardonagh Midco 3 PLC(10)(21)(23)(24)	First lien senior secured GBP term loan	S + 6.75%	7/14/2026	6,310	5,736	6,310	0.5	%
Ardonagh Midco 3 PLC(14)(21)(23)(24)	First lien senior secured loan	E + 6.75%	7/14/2026	558	538	558	—	%
Ardonagh Midco 3 PLC(8)(21)(23)(24)	First lien senior secured USD delayed draw term loan	L + 5.50%	7/14/2026	1,440	1,412	1,440	0.1	%
Ardonagh Midco 3 PLC(16)(18)(21)(23)(24)	First lien senior secured GBP delayed draw term loan	S + 6.75%	8/19/2023	—	—	—	—	%
Brightway Holdings, LLC(6)(23)(24)	First lien senior secured loan	L + 6.50%	12/16/2027	4,474	4,418	4,418	0.3	%
Brightway Holdings, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.50%	12/16/2027	—	(7)	(7)	—	%
Evolution BuyerCo, Inc. (dba SIAA)(8)(24)	First lien senior secured loan	L + 6.25%	4/28/2028	29,804	29,409	29,431	2.2	%
Evolution BuyerCo, Inc. (dba SIAA)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.25%	4/30/2027	—	(28)	(28)	—	%
Integrity Marketing Acquisition, LLC(9)(24)	First lien senior secured loan	L + 5.75%	8/27/2025	27,570	27,263	27,570	2.0	%
Integrity Marketing Acquisition, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	8/27/2025	—	(17)	—	—	%
Norvax, LLC (dba GoHealth)(9)(24)	First lien senior secured loan	L + 6.50%	9/15/2025	17,195	16,698	17,281	1.3	%
Norvax, LLC (dba GoHealth)(8)(16)(23)(24)	First lien senior secured revolving loan	L + 6.50%	9/13/2024	2,114	2,092	2,114	0.2	%
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)(8)(23)(24)	First lien senior secured loan	L + 6.00%	11/1/2028	18,208	18,029	18,025	1.3	%
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)(9)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.00%	5/1/2023	3,214	3,182	3,182	0.2	%
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	11/1/2027	—	(10)	(10)	—	%
PCF Midco II, LLC (dba PCF Insurance Services)(23)(24)(26)	First lien senior secured loan	9.00% PIK	10/31/2031	21,422	19,407	19,388	1.4	%
TEMPO BUYER CORP. (dba Global Claims Services)(8)(23)(24)	First lien senior secured loan	L + 5.50%	8/28/2028	702	689	688	0.1	%
TEMPO BUYER CORP. (dba Global Claims Services)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.50%	8/26/2023	—	(2)	(2)	—	%
TEMPO BUYER CORP. (dba Global Claims Services)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	8/26/2027	—	(2)	(2)	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
THG Acquisition, LLC (dba Hilb)(8)(24)	First lien senior secured loan	L + 5.75%	12/2/2026	25,171	24,698	24,857	1.8	%
THG Acquisition, LLC (dba Hilb)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	12/2/2025	—	(31)	(23)	—	%
USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(7)(23)(24)	First lien senior secured loan	L + 5.50%	7/23/2027	1,685	1,652	1,651	0.1	%
USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)(8)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	7/23/2027	3	—	(1)	—	%
KUSRP Intermediate, Inc. (dba U.S. Retirement and Benefits Partners)(8)(23)(24)	First lien senior secured loan	L + 9.50% PIK	7/24/2028	1,347	1,322	1,320	0.1	%
				174,161	169,116	170,884	12.5	%
Internet software and services
3ES Innovation Inc. (dba Aucerna)(8)(21)(24)	First lien senior secured loan	L + 6.75%	5/13/2025	10,810	10,715	10,648	0.8	%
3ES Innovation Inc. (dba Aucerna)(16)(17)(21)(23)(24)	First lien senior secured revolving loan	L + 6.75%	5/13/2025	—	(5)	(10)	—	%
Apptio, Inc.(9)(23)(24)	First lien senior secured loan	L + 7.25%	1/10/2025	7,364	7,279	7,364	0.5	%
Apptio, Inc.(9)(16)(23)(24)	First lien senior secured revolving loan	L + 7.25%	1/10/2025	196	191	196	—	%
Barracuda Networks, Inc.(8)(23)(24)	Second lien senior secured loan	L + 6.75%	10/30/2028	7,500	7,433	7,500	0.6	%
Bayshore Intermediate #2, L.P. (dba Boomi)(8)(23)(24)	First lien senior secured loan	L + 7.75% PIK	10/2/2028	14,872	14,546	14,537	1.1	%
Bayshore Intermediate #2, L.P. (dba Boomi)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.75%	10/1/2027	—	(27)	(28)	—	%
BCPE Nucleon (DE) SPV, LP(9)(23)(24)	First lien senior secured loan	L + 7.00%	9/24/2026	35,556	35,102	35,378	2.6	%
BCTO BSI Buyer, Inc. (dba Buildertrend)(8)(23)(24)	First lien senior secured loan	L + 7.00%	12/23/2026	8,482	8,409	8,440	0.6	%
BCTO BSI Buyer, Inc. (dba Buildertrend)(8)(16)(23)(24)	First lien senior secured revolving loan	L + 7.00%	12/23/2026	573	565	568	—	%
Centrify Corporation(8)(23)(24)	First lien senior secured loan	L + 5.75%	3/2/2028	13,204	12,904	12,940	1.0	%
Centrify Corporation(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	3/2/2027	—	(34)	(27)	—	%
CivicPlus, LLC(8)(23)(24)	First lien senior secured loan	L + 6.00%	8/24/2027	626	620	620	—	%
CivicPlus, LLC(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.00%	8/24/2023	—	—	—	—	%
CivicPlus, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	8/24/2027	—	(1)	(1)	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Delta TopCo, Inc. (dba Infoblox, Inc.)(9)(23)(24)	Second lien senior secured loan	L + 7.25%	12/1/2028	40,000	39,824	40,000	2.9	%
EET Buyer, Inc. (dba e-Emphasys)(8)(23)(24)	First lien senior secured loan	L + 5.75%	11/8/2027	909	900	900	0.1	%
EET Buyer, Inc. (dba e-Emphasys)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	11/8/2027	—	(1)	(1)	—	%
Forescout Technologies, Inc.(8)(23)(24)	First lien senior secured loan	L + 9.50% PIK	8/17/2026	7,181	7,090	7,182	0.5	%
Forescout Technologies, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 8.50%	8/18/2025	—	(9)	—	—	%
Genesis Acquisition Co. (dba Procare Software)(8)(24)	First lien senior secured loan	L + 4.00%	7/31/2024	2,014	1,996	1,959	0.1	%
Genesis Acquisition Co. (dba Procare Software)(8)(23)(24)	First lien senior secured revolving loan	L + 4.00%	7/31/2024	293	290	285	—	%
GovBrands Intermediate, Inc.(8)(23)(24)	First lien senior secured loan	L + 5.50%	8/4/2027	2,485	2,425	2,423	0.2	%
GovBrands Intermediate, Inc.(6)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.50%	8/4/2023	560	544	543	—	%
GovBrands Intermediate, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	8/4/2027	—	(4)	(5)	—	%
H&F Opportunities LUX III S.À R.L (dba Checkmarx)(9)(21)(23)(24)	First lien senior secured loan	L + 7.50%	4/16/2026	14,545	14,212	14,545	1.1	%
H&F Opportunities LUX III S.À R.L (dba Checkmarx)(16)(17)(21)(23)(24)	First lien senior secured revolving loan	L + 7.50%	4/16/2026	—	(98)	—	—	%
Hyland Software, Inc.(6)(23)(24)	Second lien senior secured loan	L + 6.25%	7/7/2025	12,145	12,135	12,222	0.9	%
IQN Holding Corp. (dba Beeline)(9)(24)	First lien senior secured loan	L + 5.50%	8/20/2024	20,792	20,636	20,792	1.5	%
IQN Holding Corp. (dba Beeline)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	8/21/2023	—	(13)	—	—	%
Litera Bidco LLC(6)(24)	First lien senior secured loan	L + 5.85%	5/29/2026	27,184	26,898	27,184	2.0	%
Litera Bidco LLC(6)(16)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.00%	10/29/2022	353	343	353	—	%
Litera Bidco LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	5/29/2026	—	(8)	—	—	%
MessageBird BidCo B.V.(9)(21)(24)	First lien senior secured loan	L + 6.75%	4/29/2027	16,000	15,678	15,680	1.2	%
MINDBODY, Inc.(9)(24)	First lien senior secured loan	L + 8.50% (incl. 1.50% PIK)	2/14/2025	11,846	11,773	11,846	0.9	%
MINDBODY, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 7.00%	2/14/2025	—	(6)	—	—	%
Ministry Brands Holdings, LLC(8)(23)(24)	First lien senior secured loan	L + 5.50%	12/29/2028	706	692	692	0.1	%
Ministry Brands Holdings, LLC(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.50%	12/27/2023	—	(2)	(2)	—	%
Ministry Brands Holdings, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	12/27/2027	—	(1)	(1)	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
QAD, Inc.(7)(23)(24)	First lien senior secured loan	L + 6.00%	11/5/2027	4,429	4,342	4,340	0.3	%
QAD, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	11/5/2027	—	(11)	(11)	—	%
Proofpoint, Inc.(8)(23)(24)	Second lien senior secured loan	L + 6.25%	8/31/2029	4,900	4,876	4,876	0.4	%
Tahoe Finco, LLC(8)(21)(23)(24)	First lien senior secured loan	L + 6.00%	9/29/2028	23,256	23,030	22,977	1.7	%
Tahoe Finco, LLC(16)(17)(21)(23)(24)	First lien senior secured revolving loan	L + 6.00%	10/1/2027	—	(17)	(21)	—	%
Thunder Purchaser, Inc. (dba Vector Solutions)(8)(24)	First lien senior secured loan	L + 5.75%	6/30/2028	13,872	13,741	13,777	1.0	%
Thunder Purchaser, Inc. (dba Vector Solutions)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 5.75%	8/17/2023	—	—	(9)	—	%
Thunder Purchaser, Inc. (dba Vector Solutions)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	6/30/2027	—	(8)	(6)	—	%
When I Work, Inc.(8)(23)(24)	First lien senior secured loan	L + 6.00%	11/2/2027	762	754	754	0.1	%
When I Work, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	11/2/2027	—	(1)	(1)	—	%
				303,415	299,697	301,398	22.2	%
Leisure and entertainment
Troon Golf, L.L.C.(8)(24)	First lien senior secured loan	L + 6.00%	8/5/2027	61,333	61,043	61,026	4.5	%
Troon Golf, L.L.C.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	8/5/2026	—	(22)	(23)	—	%
				61,333	61,021	61,003	4.5	%
Manufacturing
Gloves Buyer, Inc. (dba Protective Industrial Products)(6)(23)(24)	Second lien senior secured loan	L + 8.25%	12/29/2028	6,300	6,156	6,221	0.5	%
Ideal Tridon Holdings, Inc.(8)(24)	First lien senior secured loan	L + 5.25%	7/31/2024	13,520	13,377	13,520	1.0	%
Ideal Tridon Holdings, Inc.(6)(16)(23)(24)	First lien senior secured revolving loan	L + 5.25%	7/31/2023	400	391	400	—	%
MHE Intermediate Holdings, LLC (dba OnPoint Group)(8)(24)	First lien senior secured loan	L + 5.75%	7/21/2027	18,428	18,255	18,243	1.3	%
MHE Intermediate Holdings, LLC (dba OnPoint Group)(8)(16)(18)(24)	First lien senior secured delayed draw term loan	L + 5.75%	7/21/2023	1,543	1,528	1,527	0.1	%
MHE Intermediate Holdings, LLC (dba OnPoint Group)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	7/21/2027	—	(17)	(18)	—	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
PHM Netherlands Midco B.V. (dba Loparex)(8)(23)(24)	First lien senior secured loan	L + 4.50%	7/31/2026	196	185	196	—	%
PHM Netherlands Midco B.V. (dba Loparex)(6)(24)	Second lien senior secured loan	L + 8.75%	7/30/2027	28,000	26,479	27,650	2.0	%
Safety Products/JHC Acquisition Corp. (dba Justrite Safety Group)(6)(24)	First lien senior secured loan	L + 4.50%	6/28/2026	3,481	3,457	3,237	0.2	%
Sonny's Enterprises LLC(6)(24)	First lien senior secured loan	L + 6.75%	8/5/2026	44,840	44,182	44,839	3.3	%
Sonny's Enterprises LLC(6)(16)(23)(24)	First lien senior secured revolving loan	L + 6.75%	8/5/2025	376	338	376	—	%
				117,084	114,331	116,191	8.4	%
Oil and gas
Black Mountain Sand Eagle Ford LLC(8)(23)(24)	First lien senior secured loan	L + 8.25%	8/17/2022	534	535	534	—	%
Project Power Buyer, LLC (dba PEC-Veriforce)(8)(24)	First lien senior secured loan	L + 6.00%	5/14/2026	7,957	7,882	7,957	0.6	%
Project Power Buyer, LLC (dba PEC-Veriforce)(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	5/14/2025	—	(4)	—	—	%
Zenith Energy U.S. Logistics Holdings, LLC(8)(24)	First lien senior secured loan	L + 5.50%	12/20/2024	19,021	18,725	19,021	1.4	%
				27,512	27,138	27,512	2.0	%
Professional services
AmSpec Group, Inc. (fka AmSpec Services Inc.)(8)(24)	First lien senior secured loan	L + 5.75%	7/2/2024	18,768	18,604	18,675	1.4	%
AmSpec Group, Inc. (fka AmSpec Services Inc.)(12)(16)(23)(24)	First lien senior secured revolving loan	P + 3.75%	7/2/2024	646	628	634	—	%
Apex Group Treasury, LLC(8)(21)(23)(24)	Second lien senior secured loan	L + 6.75%	7/27/2029	5,000	4,952	4,950	0.4	%
Apex Group Treasury, LLC(16)(18)(21)(23)(24)	Second lien senior secured delayed draw term loan	L + 6.75%	6/30/2022	—	—	—	—	%
Gerson Lehrman Group, Inc.(9)(24)	First lien senior secured loan	L + 5.25%	12/12/2024	6,264	6,231	6,264	0.5	%
Gerson Lehrman Group, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.25%	12/12/2024	—	(10)	—	—	%
Guidehouse Inc.(6)(23)(24)	First lien senior secured loan	L + 5.50%	10/16/2028	930	921	921	0.1	%
Guidehouse Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.50%	10/15/2027	—	—	(1)	—	%
Relativity ODA LLC(6)(24)	First lien senior secured loan	L + 7.50% PIK	5/12/2027	15,590	15,387	15,395	1.1	%
Relativity ODA LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.50%	5/12/2027	—	(20)	(18)	—	%
				47,198	46,693	46,820	3.5	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Specialty retail
Galls, LLC(8)(24)	First lien senior secured loan	L + 6.75% (incl. 0.50% PIK)	1/31/2025	17,072	16,947	16,047	1.2	%
Galls, LLC(8)(16)(23)(24)	First lien senior secured revolving loan	L + 6.75%	1/31/2024	1,947	1,894	1,630	0.1	%
Milan Laser Holdings LLC(8)(24)	First lien senior secured loan	L + 5.00%	4/27/2027	22,924	22,717	22,752	1.7	%
Milan Laser Holdings LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.00%	4/27/2026	—	(17)	(15)	—	%
Notorious Topco, LLC (dba Beauty Industry Group)(8)(24)	First lien senior secured loan	L + 6.50%	11/22/2027	24,366	24,007	24,001	1.8	%
Notorious Topco, LLC (dba Beauty Industry Group)(16)(17)(18)(23)(24)	First lien senior secured delayed draw term loan	L + 6.50%	11/23/2023	—	(22)	(9)	—	%
Notorious Topco, LLC (dba Beauty Industry Group)(8)(16)(23)(24)	First lien senior secured revolving loan	L + 6.50%	5/24/2027	352	321	320	—	%
The Shade Store, LLC(7)(23)(24)	First lien senior secured loan	L + 6.00%	10/13/2027	2,273	2,245	2,244	0.2	%
The Shade Store, LLC(16)(17)(23)(24)	First lien senior secured revolving loan	L + 6.00%	10/13/2026	—	(3)	(3)	—	%
				68,934	68,089	66,967	5.0	%
Transportation
Lazer Spot G B Holdings, Inc.(8)(24)	First lien senior secured loan	L + 5.75%	12/9/2025	40,491	39,998	40,491	3.0	%
Lazer Spot G B Holdings, Inc.(16)(17)(23)(24)	First lien senior secured revolving loan	L + 5.75%	12/9/2025	—	(85)	—	—	%
Lytx, Inc.(6)(24)	First lien senior secured loan	L + 6.75%	2/28/2026	23,911	23,639	23,731	1.7	%
Motus Group, LLC(8)(23)(24)	Second lien senior secured loan	L + 6.50%	12/10/2029	3,615	3,579	3,579	0.3	%
				68,017	67,131	67,801	5.0	%
Total non-controlled/non-affiliated portfolio company debt investments				$2,333,964	$2,295,111	$2,295,513	169.2	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Equity Investments
Automotive
Metis HoldCo, Inc. (dba Mavis Tire Express Services)(23)(24)(26)(27)	Series A Convertible Preferred Stock	7.00% PIK	N/A	32,308	32,783	33,645	2.5	%
CD&R Value Building Partners I, L.P. (dba Belron)(21)(23)(24)(27)(32)	LP Interest	N/A	N/A	1,002	1,002	1,000	0.1	%
					33,785	34,645	2.6	%
Buildings and real estate
Skyline Holdco B, Inc. (dba Dodge Data & Analytics)(23)(24)(27)(32)	Series A Preferred Stock	N/A	N/A	431,889	648	715	0.1	%
					648	715	0.1	%
Business Services
Denali Holding, LP (dba Summit Companies)(23)(24)(27)(32)	Class A Units	N/A	N/A	39,300	393	393	—	%
Hercules Buyer LLC (dba The Vincit Group)(19)(23)(24)(27)(32)	Common Units	N/A	N/A	350,000	350	350	—	%
					743	743	—	%
Consumer Products
ASP Conair Holdings LP(23)(24)(27)(32)	Class A Units	N/A	N/A	12,857	1,286	1,286	0.1	%
					1,286	1,286	0.1	%
Food and beverage
H-Food Holdings, LLC(23)(24)(27)(32)	LLC Interest	N/A	N/A	1,625	1,625	2,037	0.1	%
					1,625	2,037	0.1	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Healthcare equipment and services
KPCI Holdings, L.P.(23)(24)(27)(32)	Class A Units	N/A	N/A	5,665	6,014	6,954	0.5	%
Patriot Holdings SCSp (dba Corza Health, Inc.)(23)(24)(26)(27)	Class A Units	8.00% PIK	N/A	1,370	1,473	1,473	0.1	%
Patriot Holdings SCSp (dba Corza Health, Inc.)(23)(24)(27)(32)	Class B Units	N/A	N/A	18,864	—	214	—	%
					7,487	8,641	0.6
Healthcare providers and services
KOBHG Holdings L.P. (dba OB Hospitalist)(23)(24)(27)(32)	Class A Interests	N/A	N/A	1,291	1,291	1,291	0.1	%
Restore OMH Intermediate Holdings, Inc. (23)(24)(26)(27)	Senior Preferred Stock	13.00% PIK	N/A	305	3,409	3,401	0.3	%
					4,700	4,692	0.4	%
Human resource support services
Sunshine Software Holdings Inc (dba Cornerstone OnDemand, Inc.)(23)(24)(26)(27)	Series A Preferred Stock	10.50% PIK	N/A	5,500	5,486	5,483	0.4	%
					5,486	5,483	0.4	%
Insurance
Evolution Parent, LP (dba SIAA)(23)(24)(27)(32)	LP Interest	N/A	N/A	892	892	892	0.1	%
GrowthCurve Capital Sunrise Co-Invest LP (dba Brightway)(23)(24)(27)(32)	LP Interest	N/A	N/A	106	106	105	—	%
Norvax, LLC (dba GoHealth)(20)(23)(24)(32)	Common Stock	N/A	N/A	227,097	1,163	861	0.1	%
PCF Holdco, LLC (dba PCF Insurance Services)(23)(24)(27)(32)	Class A Units	N/A	N/A	4,661	4,661	4,661	0.3	%
PCF Holdco, LLC (dba PCF Insurance Services)(23)(24)(27)(32)	Class A Warrants	N/A	N/A	1,714	1,714	1,714	0.1	%
					8,536	8,233	0.6	%
Internet software and services
BCTO WIW Holdings, Inc. (dba When I Work)(23)(24)(27)(32)	Class A Common Stock	N/A	N/A	3,000	300	300	—	%
Brooklyn Lender Co-Invest 2, L.P. (dba Boomi)(23)(24)(27)(32)	LP Common Units	N/A	N/A	1,345,119	1,345	1,345	0.1	%
MessageBird Holding B.V.(21)(23)(24)(27)(32)	Extended Series C Warrants	N/A	N/A	25,540	157	157	—	%
Thunder Topco L.P. (dba Vector Solutions)(23)(24)(27)(32)	Common Units	N/A	N/A	820	820	967	0.1	%
VEPF Torreys Aggregator, LLC (dba MINDBODY, Inc.)(23)(24)(26)(27)	Series A Preferred Stock	6.00% PIK	N/A	3,750	3,750	3,750	0.3	%
					6,372	6,519	0.5	%

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)


Company(1)(2)(3)(22)	Investment	Interest	Maturity Date	Par / Units	Amortized Cost(4)(30)	Fair Value	Percentage of Net Assets
Manufacturing
Gloves Holdings, LP (dba Protective Industrial Products)(23)(24)(27)(32)	LP Interest	N/A	N/A	700	700	784	0.1	%
Windows Entities(21)(23)(24)(27)(28)	LLC Interest	N/A	N/A	10,607	18,982	34,520	2.5	%
					19,682	35,304	2.6	%
Professional Services
WMC Bidco, Inc. (dba West Monroe)(23)(24)(26)(27)	Senior Preferred Stock	11.25% PIK	N/A	2,385	2,321	2,319	0.2	%
					2,321	2,319	0.2	%
Total non-controlled/non-affiliated portfolio company equity investments					$92,671	$110,617	8.2	%
Total non-controlled/non-affiliated portfolio company investments					2,387,782	2,406,130	177.4	%

Non-controlled/affiliated portfolio company investments
Debt Investments
Advertising and media
Swipe Acquisition Corporation (dba PLI)(8)(23)(24)(31)	First lien senior secured loan	L + 8.00%	6/29/2024	6,205	6,115	6,127	0.5	%
Swipe Acquisition Corporation (dba PLI)(8)(16)(23)(24)(31)	First lien senior secured delayed draw term loan	L + 8.00%	12/30/2022	1,351	1,351	1,319	0.1	%
Swipe Acquisition Corporation (dba PLI)(16)(23)(24)(31)	Letter of Credit	L + 8.00%	6/29/2024	—	—	—	—	%
				7,556	7,466	7,446	0.6	%
Total non-controlled/affiliated portfolio company debt investments				$7,556	$7,466	$7,446	0.6	%

Equity Investments
Advertising and media
New PLI Holdings, LLC (dba PLI)(23)(24)(27)(31)(32)	Class A Common Units	N/A	N/A	10,755	5,952	5,952	0.4	%
					5,952	5,952	0.4	%
Total non-controlled/affiliated portfolio company equity investments					$5,952	$5,952	0.4	%
Total non-controlled/affiliated portfolio company investments					$13,418	$13,398	1.0	%
Total Investments					$2,401,200	$2,419,528	178.4	%

________________

(1)

Certain portfolio company investments are subject to contractual restrictions on sales.

(2)

(3)

Unless otherwise indicated, all investments are considered Level 3 investments.

(4)

The amortized cost represents the original cost adjusted for the amortization of discounts and premiums, as applicable, on debt investments using the effective interest method.

(5)

Unless otherwise indicated, loan contains a variable rate structure, and may be subject to an interest rate floor. Variable rate loans bear interest at a rate that may be determined by reference to either the London Interbank Offered Rate (“LIBOR” or “L”) (which can include one-, two-, three-, six- or twelve-month LIBOR), Euro Interbank Offered Rate (“EURIBOR” or “E”, which can include one-, two-, three- or six-month EURIBOR), British pound sterling LIBOR (“GBPLIBOR” or “G”), or an alternate base rate (which can include the Federal Funds Effective Rate or the Prime Rate), at the borrower’s option, and which reset periodically based on the terms of the loan agreement.

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)

(6)

The interest rate on these loans is subject to 1 month LIBOR, which as of December 31, 2021 was 0.10%.

(7)

The interest rate on these loans is subject to 2 month LIBOR, which as of December 31, 2021 was 0.15%.

(8)

The interest rate on these loans is subject to 3 month LIBOR, which as of December 31, 2021 was 0.21%.

(9)

The interest rate on these loans is subject to 6 month LIBOR, which as of December 31, 2021 was 0.34%.

(10)

The interest rate on these loans is subject to SONIA, which as of December 31, 2021 was 0.26%.

(11)

The interest rate on this loan is subject to 3 month Canadian Dollar Offered Rate (“CDOR” or “C”), which as of December 31, 2021 was 0.52%.

(12)

The interest rate on these loans is subject to Prime, which as of December 31, 2021 was 3.25%.

(13)

The interest rate on these loans is subject to 3 month EURIBOR, which as of December 31, 2021 was (0.57)%.

(14)

The interest rate on these loans is subject to 6 month EURIBOR, which as of December 31, 2021 was (0.55)%.

(15)

The interest rate on these loans is subject to 6 month GBPLIBOR, which as of December 31, 2021 was 0.26%.

(16)

Position or portion thereof is an unfunded loan commitment. See Note 7 “Commitments and Contingencies”.

(17)

(18)

The date disclosed represents the commitment period of the unfunded term loan. Upon expiration of the commitment period, the funded portion of the term loan may be subject to a longer maturity date.

(19)

We invest in this portfolio company through underlying blocker entities Hercules Blocker 1 LLC, Hercules Blocker 2 LLC, Hercules Blocker 3 LLC, Hercules Blocker 4 LLC, and Hercules Blocker 5 LLC.

(20)

Level 1 investment.

(21)

This portfolio company is not a qualifying asset under Section 55(a) of the 1940 Act. Under the 1940 Act, the Company may not acquire any non-qualifying asset unless, at the time such acquisition is made, qualifying assets represent at least 70% of total assets. As of December 31, 2021, non-qualifying assets represented 8.9% of total assets as calculated in accordance with the regulatory requirements.

(22)

Unless otherwise indicated, all or a portion of the Company’s portfolio companies are pledged as collateral supporting the available capacity under the SPV Asset Facility I. See Note 6 “Debt.”

(23)

Investment is not pledged as collateral for the credit facilities.

(24)

(25)

Level 2 investment.

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)

(26)

Investment does not contain a variable rate structure.

(27)

Security acquired in transaction exempt from registration under the Securities Act of 1933, and may be deemed to be “restricted securities” under the Securities Act. As of December 31, 2021, the aggregate fair value of these securities is $115.7 million, or 8.5% of the Company’s net assets. The acquisition dates of the restricted securities are as follows:


Portfolio Company	Investment	Acquisition Date
ASP Conair Holdings LP	Class A Units	May 17, 2021
BCTO WIW Holdings, Inc. (dba When I Work)	Class A Common Stock	November 2, 2021
Brooklyn Lender Co-Invest 2, L.P. (dba Boomi)	LP Common Units	October 1, 2021
CD&R Value Building Partners I, L.P. (dba Belron)	LP Interest	December 2, 2021
Denali Holding, LP (dba Summit Companies)	Class A Units	September 15, 2021
Evolution Parent, LP (dba SIAA)	LP Interest	April 30, 2021
Gloves Holdings, LP (dba Protective Industrial Products)	LP Interest	December 29, 2020
GrowthCurve Capital Sunrise Co-Invest LP (dba Brightway)	LP Interest	December 16, 2021
Hercules Buyer LLC (dba The Vincit Group)	Common Units	December 15, 2020
H-Food Holdings, LLC	LLC Interest	November 23, 2018
KOBHG Holdings, L.P.	Class A Interests	September 27, 2021
KPCI Holdings, L.P.	LP Interest	November 30, 2020
MessageBird Holding B.V.	Extended Series C Preferred Equity Warrants	May 5, 2021
Metis HoldCo, Inc. (dba Mavis Tire Express Services)	Series A Convertible Preferred Stock	May 4, 2021
New PLI Holdings, LLC (dba PLI)	Class A Common Units	December 23, 2020
PCF Holdco, LLC (dba PCF Insurance Services)	Class A Units	October 29, 2021
PCF Holdco, LLC (dba PCF Insurance Services)	Class A Warrants	November 1, 2021
Patriot Holdings SCSp (dba Corza Health, Inc.)	Class A Units	January 29, 2021
Patriot Holdings SCSp (dba Corza Health, Inc.)	Class B Units	January 29, 2021
Restore OMH Intermediate Holdings, Inc.	Senior Preferred Stock	December 9, 2020
Skyline Holdco B, Inc. (dba Dodge Data & Analytics)	Series A Preferred Stock	April 14, 2021
Sunshine Software Holdings Inc (dba Cornerstone OnDemand, Inc.)	Series A Preferred Stock	October 14, 2021
Thunder Topco L.P. (dba Vector Solutions)	Common Units	June 30, 2021
VEPF Torreys Aggregator, LLC (dba MINDBODY, Inc.)	Series A Preferred Stock	October 15, 2021
Windows Entities	LLC Interest	January 16, 2020
WMC Bidco, Inc. (dba West Monroe)	Senior Preferred Stock	November 9, 2021

(28)

(29)

Loan was on non-accrual status as of December 31, 2021.

(30)

As of December 31, 2021, the net estimated unrealized loss for U.S. federal income tax purposes was $0.1 million based on a tax cost basis of $2.4 billion. As of December 31, 2021, the estimated aggregate gross unrealized loss for U.S. federal income tax purposes was $32.5 million and the estimated aggregate gross unrealized gain for U.S. federal income tax purposes was $32.6 million.

(31)

Under the 1940 Act, the Company is deemed to be an “Affiliated Person” of, as defined in the 1940 Act, this portfolio company, as the Company owns more than 5% of the portfolio company’s outstanding voting securities. Transactions during the year ended December 31, 2021 in which the Company was an Affiliated Person of the portfolio company are as follows:


Company	Fair Value at December 31, 2020		Gross Additions		Gross Reductions		Net Change in Unrealized Gain/(Loss)		Realized Gain/(Loss)		Transfers		Fair Value at December 31, 2021		Other Income		Interest Income
Swipe Acquisition Corporation (dba PLI)	$	12,312	$	1,052	$	—	$	33	$	—	$	—	$	13,398	$	81	$	680
Total	$	12,312	$	1,052	$	—	$	33	$	—	$	—	$	13,398	$	81	$	680

(a)

Owl Rock Capital Corporation II

Consolidated Schedule of Investments (Continued)

As of December 31, 2021

(Amounts in thousands, except share amounts)

(b)

(32)

Investment is non-income producing.

The accompanying notes are an integral part of these consolidated financial statements.

Owl Rock Capital Corporation II

Consolidated Statements of Changes in Net Assets

(Amounts in thousands)

(Unaudited)


	For the Three Months Ended March 31,
	2022			2021
Increase (Decrease) in Net Assets Resulting from Operations
Net investment income (loss)	$	22,984		$	21,062
Net change in unrealized gain (loss)		(13,719	)		10,834
Net realized gain (loss)		740			367
Net Increase (Decrease) in Net Assets Resulting from Operations		10,005			32,263
Distributions
Distributions declared from earnings(1)		(22,847	)		(22,434	)
Net Decrease in Net Assets Resulting from Shareholders' Distributions		(22,847	)		(22,434	)
Capital Share Transactions
Issuance of shares of common stock		—			54,727
Reinvestment of shareholders' distributions		10,481			10,186
Repurchased shares		(15,362	)		—
Net Increase (Decrease) in Net Assets Resulting from Capital Share Transactions		(4,881	)		64,913
Total Increase (Decrease) in Net Assets		(17,723	)		74,742
Net Assets, at beginning of period		1,359,691			1,286,304
Net Assets, at end of period	$	1,341,968		$	1,361,046

________________

(1)

For the three months ended March 31, 2022 and 2021, distributions declared from earnings were derived from net investment income.

Owl Rock Capital Corporation II

Consolidated Statements of Cash Flows

(Amounts in thousands)

(Unaudited)


	For the Three Months Ended March 31,
	2022			2021
Cash Flows from Operating Activities
Net Increase (Decrease) in Net Assets Resulting from Operations	$	10,005		$	32,263
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:
Purchases of investments, net		(53,118	)		(181,636	)
Proceeds from investments and investment repayments, net		82,769			130,869
Net change in unrealized (gain) loss on investments		12,300			(12,263	)
Net change in unrealized (gain) loss on translation of assets and liabilities in foreign currencies		1,431			499
Net realized (gain) loss on investments		(795	)		(197	)
Net realized (gain) loss on foreign currency transactions relating to investments		(1	)		(5	)
Paid-in-kind interest		(5,436	)		(2,146	)
Net amortization of discount on investments		(2,263	)		(2,261	)
Amortization of debt issuance costs		342			771
Amortization of offering costs		—			385
Changes in operating assets and liabilities:
(Increase) decrease in interest receivable		(2,453	)		(937	)
(Increase) decrease in receivable for investments sold		11,623			7,865
(Increase) decrease in prepaid expenses and other assets		(811	)		1,174
Increase (decrease) in payable for investments purchased		—			1,803
Increase (decrease) in payables to affiliates		(2,520	)		1,489
Increase (decrease) in accrued expenses and other liabilities		5,903			5,492
Net cash provided by (used in) operating activities		56,976			(16,835	)
Cash Flows from Financing Activities
Borrowings on debt		70,000			75,000
Repayments of debt		(115,000	)		(101,000	)
Debt issuance costs		(1,339	)		(109	)
Proceeds from issuance of common shares		—			51,860
Distributions paid to shareholders		(12,366	)		(12,248	)
Repurchased shares		(15,362	)		—
Net cash provided by (used in) financing activities		(74,067	)		13,503
Net increase (decrease) in cash, including foreign cash		(17,091	)		(3,332	)
Cash, including foreign cash, beginning of period		54,067			42,830
Cash, including foreign cash, end of period	$	36,976		$	39,498

Supplemental and Non-Cash Information
Interest paid during the period	$	4,816		$	3,071
Distributions declared during the period	$	22,847		$	22,434
Subscription receivable	$	—		$	2,867
Reinvestment of distributions during the period	$	10,481		$	10,186
Taxes, including excise tax, paid during the period	$	229		$	—

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited)

Note 1. Organization and Principal Business

Owl Rock Capital Corporation II (the “Company”) is a Maryland corporation formed on October 15, 2015. The Company’s investment objective is to generate current income, and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. The Company’s investment strategy focuses primarily on originating and making loans to, and making debt and equity investments in, U.S. middle market companies. The Company invests in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity-related securities which includes common and preferred stock, securities convertible into common stock, and warrants. The Company may on occasion invest in smaller or larger companies if an attractive opportunity presents itself, especially when there are dislocations in the capital markets, including the high yield and large syndicated loan markets, which are often referred to as “junk” investments. The Company’s target credit investments will typically have maturities between three and ten years and generally range in size between $10 million and $125 million, although the investment size will vary with the size of the Company’s capital base.

The Company 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 tax purposes, the Company is treated as a regulated investment company (“RIC”) under Subchapter M of the Internal Revenue Code of 1986, as amended (the “Code”). Because the Company has elected to be regulated as a BDC and qualifies as a RIC under the Code, the Company’s portfolio is subject to diversification and other requirements.

In April 2017, the Company commenced operations and made its first portfolio company investment. On February 28, 2017, the Company formed a wholly-owned subsidiary, OR Lending II LLC, a Delaware limited liability company, which holds a California finance lenders license. OR Lending II LLC originates loans to borrowers headquartered in California. From time to time the Company may form wholly-owned subsidiaries to facilitate the normal course of business.

Certain of the Company’s consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

The Company is managed by Owl Rock Capital Advisors LLC (the “Adviser”). The Adviser is registered with the Securities and Exchange Commission (“SEC”) as an investment adviser under the Investment Advisers Act of 1940 (the “Advisers Act”), an indirect subsidiary of Blue Owl Capital Inc. ("Blue Owl") (NYSE: OWL) and part of Owl Rock, a division of Blue Owl focused on direct lending. Blue Owl consists of three divisions: (1) Owl Rock, which focuses on direct lending, (2) Dyal, which focuses on providing capital to institutional alternative asset managers and (3) Oak Street, which focuses on real estate strategies. Subject to the overall supervision of the Company’s Board, the Adviser manages the day-to-day operations of, and provides investment advisory and management services to, the Company. As of April 1, 2022, the Owl Rock division of Blue Owl also includes a CLO business ("Wellfleet"), which was acquired from affiliates of Littlejohn & Co. LLC.

The Company commenced a continuous public offering for up to 264,000,000 shares of its common stock on April 4, 2017. On January 29, 2020, the Company commenced a follow-on offering for up to 160,000,000 shares of its common stock. On September 30, 2016, the Adviser purchased 100 shares of the Company’s common stock at $9.00 per share, which represented the initial public offering price of $9.47 per share, net of combined upfront selling commissions and dealer manager fees. The Adviser will not tender these shares for repurchase as long as the Adviser remains the Company’s investment adviser. There is no current intention for the Adviser to discontinue in its role. On April 4, 2017, the Company received subscription agreements totaling $10.0 million for the purchase of shares of its common stock from a private placement from certain individuals and entities affiliated with the Adviser. Pursuant to the terms of those subscription agreements, the individuals and entities affiliated with the Adviser agreed to pay for such shares of common stock upon demand by one of the Company’s executive officers. On April 4, 2017, the Company sold 277,778 shares pursuant to such subscription agreements and met the minimum offering requirement for its continuous public offering of $2.5 million. The purchase price of these shares sold in the private placement was $9.00 per share, which represented the initial public offering price of $9.47 per share, net of selling commissions and dealer manager fees. Since meeting the minimum offering requirement and commencing its continuous public offering and through the termination of its offering, the Company has issued 151,364,239 shares of its common stock for gross proceeds of approximately $1.4 billion, including seed capital contributed by its Adviser in September 2016 and approximately $10.0 million in gross proceeds raised in the private placement from certain individuals and entities affiliated with Owl Rock Capital Advisors. The Company determined not to file additional post-effective amendments to its registration statement and terminated its public offering as of April 30, 2021.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

The Company’s board of directors (the “Board”) expects to contemplate a liquidity event for the Company’s shareholders three to four years after the completion of the continuous public offering. The Company will consider the offering period to be complete as of the termination date of the most recent public equity offering if the Company has not conducted a public equity offering in any continuous two year period. A liquidity event could include: (i) a listing of shares on a national securities exchange; (ii) a merger or another transaction approved by the Board in which shareholders will receive cash or shares of a publicly traded company; or (iii) a sale of all or substantially all of its assets either on a complete portfolio basis or individually followed by a liquidation to the Company and distribution of cash to its shareholders. A liquidity event may include a sale, merger or rollover transaction with one or more affiliated investment companies managed by the Adviser. A liquidity event involving a merger or sale of all or substantially all of the Company’s assets would require the approval of its shareholders in accordance with the Company’s charter. Certain types of liquidity events, such as one involving a listing of shares on a national securities exchange, would allow the Company to retain its investment portfolio intact. If the Company determines to list securities on a national securities exchange, the Company expects to, although is not required to, maintain its external management structure. If the Company has not consummated a liquidity event by the five-year anniversary of the completion of the offering, the Board will consider (subject to any necessary shareholder approvals and applicable requirements of the 1940 Act) liquidating the Company and distributing cash to its shareholders, and dissolving the Company in an orderly manner. The Board, as part of its ongoing duties, will review and evaluate any potential liquidity events and options as they become available and their favorability given current market conditions; however, there is no assurance that a liquidity event will be completed at any particular time or at all.

Note 2. Significant Accounting Policies

Basis of Presentation

The accompanying consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company is an investment company and, therefore, applies the specialized accounting and reporting guidance in Accounting Standards Codification (“ASC”) Topic 946, Financial Services – Investment Companies. In the opinion of management, all adjustments considered necessary for the fair presentation of the consolidated financial statements, have been included. The Company’s fiscal year ends on December 31.

Use of Estimates

The preparation of the consolidated financial statements in conformity with U.S. 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. Actual amounts could differ from those estimates and such differences could be material.

Cash

Cash consists of deposits held at a custodian bank. Cash is carried at cost, which approximates fair value. The Company deposits its cash with highly-rated banking corporations and, at times, may exceed the insured limits under applicable law.

Investments at Fair Value

Investment transactions are recorded on the trade date. Realized gains or losses are measured by the difference between the net proceeds received and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. The net change in unrealized gains or losses primarily reflects the change in investment values, including the reversal of previously recorded unrealized gains or losses with respect to investments realized during the period.

Investments for which market quotations are readily available are typically valued at the bid price of those market quotations. To validate market quotations, the Company utilizes a number of factors to determine if the quotations are representative of fair value, including the source and number of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available, as is the case for substantially all of the Company’s investments, are valued at fair value as determined in good faith by the Board, based on, among other things, the input of the Adviser, the Company’s audit committee, and independent third-party valuation firm(s) engaged at the direction of the Board.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

As part of the valuation process, the Board takes into account relevant factors in determining the fair value of the Company’s investments, including: the estimated enterprise value of a portfolio company (i.e., the total fair value of the portfolio company’s debt and equity), the nature and realizable value of any collateral, the portfolio company’s ability to make payments based on its earnings and cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company’s securities to any similar publicly traded securities, and overall changes in the interest rate environment and the credit markets that may affect the price at which similar investments may be made in the future. When an external event such as a purchase or sale transaction, public offering or subsequent equity sale occurs, the Board considers whether the pricing indicated by the external event corroborates its valuation.

The Board undertakes a multi-step valuation process, which includes, among other procedures, the following:

•

With respect to investments for which market quotations are readily available, those investments will typically be valued at the bid price of those market quotations;

•

With respect to investments for which market quotations are not readily available, the valuation process begins with the independent valuation firm(s) providing a preliminary valuation of each investment to the Adviser’s valuation committee;

•

Preliminary valuation conclusions are documented and discussed with the Adviser’s valuation committee. Agreed upon valuation recommendations are presented to the Audit Committee;

•

The Audit Committee reviews the valuation recommendations and recommends values for each investment to the Board; and

•

The Board reviews the recommended valuations and determines the fair value of each investment.

The Company conducts this valuation process on a quarterly basis.

The Company applies Financial Accounting Standards Board (“FASB”) Accounting Standards Codification 820, Fair Value Measurements (“ASC 820”), as amended, which establishes a framework for measuring fair value in accordance with U.S. GAAP and required disclosures of fair value measurements. ASC 820 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date. Market participants are defined as buyers and sellers in the principal or most advantageous market (which may be a hypothetical market) that are independent, knowledgeable, and willing and able to transact. In accordance with ASC 820, the Company considers its principal market to be the market that has the greatest volume and level of activity. ASC 820 specifies a fair value hierarchy that prioritizes and ranks the level of observability of inputs used in determination of fair value. In accordance with ASC 820, these levels are summarized below:

•

Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that the Company has the ability to access.

•

Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

•

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

Transfers between levels, if any, are recognized at the beginning of the period in which the transfer occurs. In addition to using the above inputs in investment valuations, the Company applies the valuation policy approved by its Board that is consistent with ASC 820. Consistent with the valuation policy, the Company evaluates the source of the inputs, including any markets in which its investments are trading (or any markets in which securities with similar attributes are trading), in determining fair value. When an investment is valued based on prices provided by reputable dealers or pricing services (such as broker quotes), the Company subjects those prices to various criteria in making the determination as to whether a particular investment would qualify for treatment as a Level 2 or Level 3 investment. For example, the Company, or the independent valuation firm(s), reviews pricing support provided by dealers or pricing services in order to determine if observable market information is being used, versus unobservable inputs.

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 Company’s investments may fluctuate from period to period. Additionally, the fair value of such 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 may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If the Company were required to liquidate a portfolio investment in a forced or liquidation sale, it could realize amounts that are different from the amounts presented and such differences could be material.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

In addition, changes in the market environment and other events that may occur over the life of the investments may cause the gains or losses ultimately realized on these investments to be different than the unrealized gains or losses reflected herein.

Rule 2a-5 under the 1940 Act was recently adopted by the SEC and establishes requirements for determining fair value in good faith for purposes of the 1940 Act. We are evaluating the impact of adopting Rule 2a-5 on the consolidated financial statements and intend to comply with the new rule’s requirements on or before the compliance date in September 2022.

Foreign Currency

Foreign currency amounts are translated into U.S. dollars on the following basis:

•

cash, fair value of investments, outstanding debt, other assets and liabilities: at the spot exchange rate on the last business day of the period; and

•

purchases and sales of investments, borrowings and repayments of such borrowings, income and expenses: at the rates of exchange prevailing on the respective dates of such transactions.

The Company includes net changes in fair values on investments held resulting from foreign exchange rate fluctuations with the change in unrealized gains (losses) on translation of assets and liabilities in foreign currencies on the Consolidated Statements of Operations. The Company’s current approach to hedging the foreign currency exposure in its non-U.S. dollar denominated investments is primarily to borrow the par amount in local currency under the Company’s SPV Asset Facilities to fund these investments. Fluctuations arising from the translation of foreign currency borrowings are included with the net change in unrealized gains (losses) on translation of assets and liabilities in foreign currencies on the Consolidated Statements of Operations.

Investments denominated in foreign currencies and foreign currency transactions may involve certain considerations and risks not typically associated with those of domestic origin, including unanticipated movements in the value of the foreign currency relative to the U.S. dollar.

Interest and Dividend Income Recognition

Interest income is recorded on the accrual basis and includes amortization of discounts or premiums. Certain investments may have contractual payment-in-kind (“PIK”) interest or dividends. PIK interest and dividends represent accrued interest or dividends that are added to the principal amount or liquidation amount of the investment on the respective interest or dividend payment dates rather than being paid in cash and generally becomes due at maturity or the occurrence of a liquidation event. For the three months ended March 31, 2022, PIK interest and PIK dividend income earned was $5.0 million, representing approximately 10.3% of investment income. For the three months ended March 31, 2021, PIK interest earned was $1.9 million, representing less than 5% of investment income. Discounts to par value on securities purchased are amortized into interest income over the contractual life of the respective security using the effective yield method. Premiums to par value on securities purchased are amortized to first call date. The amortized cost of investments represents the original cost adjusted for the amortization of discounts or premiums, if any. Upon prepayment of a loan or debt security, any prepayment premiums, unamortized upfront loan origination fees and unamortized discounts are recorded as interest income in the current period.

Loans are generally placed on non-accrual status when there is reasonable doubt that principal or interest will be collected in full. Accrued interest is generally reversed when a 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 regarding collectability. If at any point the Company believes PIK interest or dividends are not expected to be realized, the investment generating PIK interest or dividends will be placed on non-accrual status. When a PIK investment is placed on non-accrual status, the accrued, uncapitalized interest or dividends are generally reversed through interest income. Non-accrual loans are restored to accrual status when past due principal and interest is paid current and, in management’s judgment, are likely to remain current. Management may make exceptions to this treatment and determine to not place a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection.

Dividend income on preferred equity securities is recorded on the accrual basis to the extent that such amounts are payable by the portfolio company and are expected to be collected. 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.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Other Income

From time to time, the Company may receive fees for services provided to portfolio companies. These fees are generally only available to the Company as a result of closing investments, are generally paid at the closing of the investments, are generally non-recurring, and are recognized as revenue when earned upon closing of the investment. The services that the Adviser provides vary by investment, but can include closing, work, diligence or other similar fees and fees for providing managerial assistance to the Company’s portfolio companies.

Offering Expenses

Costs associated with the offering of common shares of the Company were capitalized as deferred offering expenses and were included in prepaid expenses and other assets in the Consolidated Statements of Assets and Liabilities and are amortized over a twelve-month period from incurrence. These expenses consist primarily of legal fees and other costs incurred in connection with the Company’s continuous public offering of its common shares, the preparation of the Company’s registration statement, and registration fees. All remaining capitalized and unamortized offering expenses were expensed in the current period in connection with the termination of the Company's offering of common shares as of April 30, 2021.

Debt Issuance Costs

The Company records origination and other expenses related to its debt obligations as deferred financing costs. These expenses are deferred and amortized utilizing the effective yield method over the life of the related debt instrument. Debt issuance costs are presented on the Consolidated Statements of Assets and Liabilities as a direct deduction from the debt liability. In circumstances in which there is not an associated debt liability amount recorded in the consolidated financial statements when the debt issuance costs are incurred, such debt issuance costs will be reported on the Consolidated Statements of Assets and Liabilities as an asset until the debt liability is recorded.

Reimbursement of Transaction-Related Expenses

The Company may receive reimbursement for certain transaction-related expenses in pursuing investments. Transaction-related expenses, which are generally expected to be reimbursed by the Company’s portfolio companies, are typically deferred until the transaction is consummated and are recorded in prepaid expenses and other assets on the date incurred. The costs of successfully completed investments not otherwise reimbursed are borne by the Company and are included as a component of the investment’s cost basis.

Cash advances received in respect of transaction-related expenses are recorded as cash with an offset to accrued expenses and other liabilities. Accrued expenses and other liabilities are relieved as reimbursable expenses are incurred.

Income Taxes

The Company has elected to be treated as a BDC under the 1940 Act. The Company has elected to be treated as a RIC under the Code beginning with the taxable year ended December 31, 2017 and intends to continue to qualify as a RIC. So long as the Company maintains its tax treatment as a RIC, it generally will not pay corporate-level U.S. federal income taxes on any ordinary income or capital gains that it distributes at least annually to its shareholders as dividends. Instead, any tax liability related to income earned and distributed by the Company represents obligations of the Company’s investors and will not be reflected in the consolidated financial statements of the Company.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

To qualify as a RIC, the Company must, among other things, meet certain source-of-income and asset diversification requirements. In addition, to qualify for RIC tax treatment, the Company must distribute to its shareholders, for each taxable year, at least 90% of its “investment company taxable income” for that year, which is generally its ordinary income plus the excess of its realized net short-term capital gains over its realized net long-term capital losses. In order for the Company not to be subject to U.S. federal excise taxes, it must distribute annually an amount at least equal to the sum of (i) 98% of its net ordinary income (taking into account certain deferrals and elections) for the calendar year, (ii) 98.2% of its capital gains in excess of capital losses for the one-year period ending on October 31 of the calendar year and (iii) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years. The Company, at its discretion, may carry forward taxable income in excess of calendar year dividends and pay a 4% nondeductible U.S. federal excise tax on this income.

Certain of the Company’s consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

The Company evaluates tax positions taken or expected to be taken in the course of preparing its consolidated financial statements to determine whether the tax positions are “more-likely-than-not” to be sustained by the applicable tax authority. Tax positions not deemed to meet the “more-likely-than-not” threshold are reserved and recorded as a tax benefit or expense in the current year. All penalties and interest associated with income taxes are included in income tax expense. Conclusions regarding tax positions are subject to review and may be adjusted at a later date based on factors including, but not limited to, on-going analyses of tax laws, regulations and interpretations thereof. There were no material uncertain income tax positions through December 31, 2021. The 2018 through 2020 tax years remain subject to examination by the IRS, and generally years 2017 through 2020 remain subject to examination by state and local tax authorities.

Distributions to Common Shareholders

Distributions to common shareholders are recorded on the record date. The amount to be distributed is determined by the Board and is generally based upon the earnings estimated by the Adviser. Net realized long-term capital gains, if any, would be generally distributed at least annually, although the Company may decide to retain such capital gains for investment.

The Company has adopted a dividend reinvestment plan that provides for reinvestment of any cash distributions on behalf of shareholders who have “opted in” to the dividend reinvestment plan. As a result, if the Board authorizes and declares a cash distribution, then the shareholders who have “opted in” to the dividend reinvestment plan will have their cash distribution automatically reinvested in additional shares of the Company’s common stock, rather than receiving the cash distribution. The Company expects to use newly issued shares to implement the dividend reinvestment plan.

Consolidation

As provided under Regulation S-X and ASC Topic 946 - Financial Services - Investment Companies, the Company will generally not consolidate its investment in a company other than a wholly-owned investment company or controlled operating company whose business consists of providing services to the Company. Accordingly, the Company consolidated the accounts of the Company's wholly-owned subsidiaries that meet the aforementioned criteria in its consolidated financial statements. All significant intercompany balances and transactions have been eliminated in consolidation.

New Accounting Pronouncements

In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848),” which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected by reference rate reform if certain criteria are met. The amendments apply only to contracts, hedging relationships, and other transactions that reference London Interbank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform. In January 2021, the FASB issued ASU No. 2021-01, “Reference Rate Reform (Topic 848),” which expanded the scope of Topic 848 to include derivative instruments impacted by discounting transition. ASU 2020-04 and ASU 2021-01 are effective for all entities through December 31, 2022. ASU No. 2021-01 provides increased clarity as the Company continues to evaluate the transition of reference rates and is currently evaluating the impact of adopting ASU No. 2020-04 and 2021-01 on the consolidated financial statements.

Other than the aforementioned guidance, the Company’s management does not believe that any recently issued, but not yet effective, accounting standards, if currently adopted, would have a material effect on the accompanying consolidated financial statements.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 3. Agreements and Related Party Transactions

As of March 31, 2022, the Company had payables to affiliates of $14.4 million, primarily comprised of $9.1 million of management fees and $3.4 million of accrued performance based incentive fees.

As of December 31, 2021, the Company had payables to affiliates of $16.9 million, primarily comprised of $8.9 million of management fees and $6.7 million of accrued performance based incentive fees.

Administration Agreement

The Company has entered into an amended and restated Administration Agreement (the “Administration Agreement”) with the Adviser. The Administration Agreement became effective on May 18, 2021 upon consummation of the transaction pursuant to which Owl Rock Capital Group, the parent of the Adviser (and a subsidiary of Owl Rock Capital Partners LP), and Dyal Capital Partners merged to form Blue Owl (the "Transaction"). The terms of the Administration Agreement are identical to the terms of the prior administration agreement. Under the terms of the Administration Agreement, the Adviser performs, or oversees the performance of, required administrative services, which includes providing office space, equipment and office services, maintaining financial records, preparing reports to shareholders and reports filed with the SEC, and managing the payment of expenses, and the performance of administrative and professional services rendered by others. On May 3, 2022, the Board approved the continuation of the Administration Agreement.

The Administration Agreement also provides that the Company reimburses the Adviser for certain offering costs.

The Company reimburses the Adviser for services performed for it pursuant to the terms of the Administration Agreement. In addition, pursuant to the terms of the Administration Agreement, the Adviser may delegate its obligations under the Administration Agreement to an affiliate or to a third party and the Company will reimburse the Adviser for any services performed for it by such affiliate or third party.

For the three months ended March 31, 2022 and 2021, the Company incurred expenses of approximately $0.5 million and $0.4 million, respectively, for costs and expenses reimbursable to the Adviser under the terms of the Administration Agreement.

Unless earlier terminated as described below, the Administration Agreement will remain in effect for two years from the date it first became effective, and will remain in effect from year to year if approved annually by (1) the vote of the Board, or by the vote of a majority of its outstanding voting securities, and (2) the vote of a majority of the Company’s directors who are not “interested persons” of the Company, of the Adviser or of any of their respective affiliates, as defined in the 1940 Act. The Administration Agreement may be terminated at any time, without the payment of any penalty, on 60 days’ written notice, by the vote of a majority of the outstanding voting securities of the Company, or by the vote of the Board or by the Adviser.

No person who is an officer, director, or employee of the Adviser or its affiliates and who serves as a director of the Company receives any compensation from the Company for his or her services as a director. However, the Company reimburses the Adviser (or its affiliates) for an allocable portion of the compensation paid by the Adviser or its affiliates to the Company’s Chief Compliance Officer, Chief Financial Officer and their respective staffs (based on the percentage of time those individuals devote, on an estimated basis, to the business and affairs of the Company). Directors who are not affiliated with the Adviser receive compensation for their services and reimbursement of expenses incurred to attend meetings.

Investment Advisory Agreement

The Company has entered into an amended and restated Investment Advisory Agreement (as amended and restated through the date hereof, the “Investment Advisory Agreement”) with the Adviser. The Investment Advisory Agreement became effective on May 18, 2021 upon consummation of the Transaction. The terms of the Investment Advisory Agreement are identical to the terms of the prior investment advisory agreement. Under the terms of the Investment Advisory Agreement, the Adviser is responsible for managing the Company’s business and activities, including sourcing investment opportunities, conducting research, performing diligence on potential investments, structuring its investments, and monitoring its portfolio companies on an ongoing basis through a team of investment professionals. On May 3, 2022, the Board approved the continuation of the Investment Advisory Agreement.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Under the terms of the Investment Advisory Agreement, the Adviser is responsible for managing the Company’s business and activities, including sourcing investment opportunities, conducting research, performing diligence on potential investments, structuring its investments, and monitoring its portfolio companies on an ongoing basis through a team of investment professionals.

The Adviser’s services under the Investment Advisory Agreement are not exclusive, and it is free to furnish similar services to other entities so long as its services to the Company are not impaired.

Unless earlier terminated as described below, the Investment Advisory Agreement will remain in effect for two years from the date it first became effective, and will remain in effect from year-to-year if approved annually by a majority of the Board or by the holders of a majority of our outstanding voting securities and, in each case, by a majority of independent directors.

The Investment Advisory Agreement will automatically terminate within the meaning of the 1940 Act and related SEC guidance and interpretations in the event of its assignment. In accordance with the 1940 Act, without payment of any penalty, the Company may terminate the Investment Advisory Agreement with the Adviser upon 60 days’ written notice. The decision to terminate the agreement may be made by a majority of the Board or the shareholders holding a majority (as defined under the 1940 Act) of the outstanding shares of the Company’s common stock or the Adviser. In addition, without payment of any penalty, the Adviser may generally terminate the Investment Advisory Agreement upon 60 days’ written notice and, in certain circumstances, the Adviser may only be able to terminate the Investment Advisory Agreement upon 120 days’ written notice.

Under the terms of the Investment Advisory Agreement, the Company will pay the Adviser a base management fee and may also pay a performance based incentive fee. The cost of both the management fee and the incentive fee will ultimately be borne by the Company’s shareholders.

Prior to February 19, 2020, the management fee was payable quarterly in arrears at an annual rate of 1.75% of the average value of the Company’s gross assets, excluding cash and cash equivalents but including assets purchased with borrowed amounts at the end of the Company’s two most recently completed calendar quarters. Beginning February 19, 2020, the annual rate was reduced to 1.50% of the average value of the Company’s gross assets. The management fee for any partial quarter is appropriately prorated. The determination of gross assets reflects changes in the fair value of the Company’s portfolio investments. The fair value of derivatives and swaps held in the Company’s portfolio, which will not necessarily equal the notional value of such derivatives and swaps, is included in the calculation of gross assets.

For the three months ended March 31, 2022 and 2021, the Company incurred management fees of approximately $9.1 million and $8.2 million, respectively.

The incentive fee consists of two components that are independent of each other, with the result that one component may be payable even if the other is not. A portion of the incentive fee will be based on the Company’s pre-incentive fee net investment income and a portion will be based on the Company’s capital gains. The portion of the incentive fee based on pre-incentive fee net investment income is determined and paid quarterly in arrears and equals (a) 100% of the pre-incentive fee net investment income between 1.5% quarterly preferred return, and 1.818% (or 1.875% prior to February 19, 2020), referred to as the upper level breakpoint, of adjusted capital, plus (b) 17.5% (or 20% prior to February 19, 2020) of pre-incentive fee net investment income in excess of 1.818% (or 1.875% prior to February 19, 2020) of adjusted capital. Adjusted capital is defined as cumulative proceeds generated from sales of the Company’s common stock, including proceeds from the Company’s distribution reinvestment plan, net of sales load (upfront selling commissions and upfront dealer manager fees) reduced for (i) distributions paid to the Company’s shareholders that represent a return of capital on a tax basis and (ii) amounts paid for share repurchases pursuant to the Company’s share repurchase program, if any, measured as of the end of the immediately preceding calendar quarter. The quarterly preferred return of 1.5% and upper level breakpoint of 1.818% (or 1.875% prior to February 19, 2020) are also adjusted for the actual number of days in each calendar quarter.

For the three months ended March 31, 2022 and 2021, the Company incurred net investment income based incentive fees of $4.6 million and $3.8 million, respectively.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

The second component of the incentive fee, the capital gains incentive fee, is payable at the end of each calendar year in arrears, and equals 17.5% (or 20% prior to February 19, 2020) of cumulative realized capital gains from inception through the end of each calendar year, less cumulative realized capital losses and unrealized capital depreciation on a cumulative basis from inception through the end of such calendar year, less the aggregate amount of any previously paid capital gains incentive fee for prior periods. In no event will the capital gains incentive fee payable pursuant to the Investment Advisory Agreement be in excess of the amount permitted by the Advisers Act, including Section 205 thereof.

While the Investment Advisory Agreement neither includes nor contemplates the inclusion of unrealized gains in the calculation of the capital gains incentive fee, as required by U.S. GAAP, the Company accrues capital gains incentive fees on unrealized gains. This accrual reflects the incentive fees that would be payable to the Adviser if the Company’s entire investment portfolio was liquidated at its fair value as of the balance sheet date even though the Adviser is not entitled to an incentive fee with respect to unrealized gains unless and until such gains are actually realized.

For the three months ended March 31, 2022, the Company recorded a reversal of capital gains based incentive fees of $1.3 million. For the three months ended March 31, 2021, the Company did not incur capital gains based incentive fees.

On June 8, 2018, the Adviser agreed to waive (A) any portion of the management fee that was in excess of 1.50% of the Company’s gross assets, excluding cash and cash-equivalents but including assets purchased with borrowed amounts at the end of the two most recently completed calendar quarters, calculated in accordance with the Investment Advisory Agreement, (B) any portion of the incentive fee on net investment income that was in excess of 17.5% of the Company’s pre-incentive fee net investment income, which was calculated in accordance with the Investment Advisory Agreement but based on a quarterly preferred return of 1.50% per quarter and an upper level breakpoint of 1.818%, and (C) any portion of the incentive fee on capital gains that was in excess of 17.5% of the Company’s realized capital gains, if any, on a cumulative basis from inception through the end of such calendar year, net of all realized capital losses and unrealized capital depreciation on a cumulative basis, minus the aggregate amount of any previously paid incentive fee on capital gains as calculated in accordance with U.S. GAAP (the “Waiver”). Any portion of the management fee, incentive fee on net investment income and incentive fee on capital gains that the Adviser previously waived is not subject to recoupment.

On February 19, 2020, the Board approved amendments to the Investment Advisory Agreement, which reduced the management fee and incentive fee to the amounts specified in the Waiver.

Under the terms of the Investment Advisory Agreement, the Adviser is entitled to receive up to 1.5% of gross offering proceeds raised in the continuous public offering until all organization and offering costs paid by the Adviser or its affiliates have been recovered. The Company bears all other expenses of its operations and transactions including, without limitation, those relating to: expenses deemed to be “organization and offering expenses” for purposes of Conduct Rule 2310(a)(12) of Financial Industry Regulatory Authority (exclusive of commissions, the dealer manager fee, any discounts and other similar expenses paid by investors at the time of sale of the Company’s stock); the cost of corporate and organizational expenses relating to offerings of shares of common stock, subject to limitations included in the Investment Advisory Agreement; the cost of calculating the Company’s net asset value, including the cost of any third-party valuation services; the cost of effecting any sales and repurchases of the common stock and other securities; fees and expenses payable under any dealer manager agreements, if any; debt service and other costs of borrowings or other financing arrangements; costs of hedging; expenses, including travel expense, incurred by the Adviser, or members of the Investment Team, or payable to third parties, performing due diligence on prospective portfolio companies and, if necessary, enforcing the Company’s rights; escrow agent, transfer agent and custodial fees and expenses; fees and expenses associated with marketing efforts; federal and state registration fees, any stock exchange listing fees and fees payable to rating agencies; federal, state and local taxes; independent directors’ fees and expenses, including certain travel expenses; costs of preparing financial statements and maintaining books and records and filing reports or other documents with the SEC (or other regulatory bodies) and other reporting and compliance costs, including registration fees, listing fees and licenses, and the compensation of professionals responsible for the preparation of the foregoing; the costs of any reports, proxy statements or other notices to shareholders (including printing and mailing costs); the costs of any shareholder or director meetings and the compensation of personnel responsible for the preparation of the foregoing and related matters; commissions and other compensation payable to brokers or dealers; research and market data; fidelity bond, directors and officers errors and omissions liability insurance and other insurance premiums; direct costs and expenses of administration, including printing, mailing, long distance telephone and staff; fees and expenses associated with independent audits, outside legal and consulting costs; costs of winding up; costs incurred in connection with the formation or maintenance of entities or vehicles to hold the Company’s assets for tax or other purposes; extraordinary expenses (such as litigation or indemnification); and costs associated with reporting and compliance obligations under the Advisers Act and applicable federal and state securities laws. Notwithstanding anything to the contrary contained herein, the Company shall reimburse the Adviser (or its affiliates) for an allocable portion of the

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

compensation paid by the Adviser (or its affiliates) to the Company’s Chief Compliance Officer and Chief Financial Officer and their respective staffs (based on a percentage of time such individuals devote, on an estimated basis, to the business affairs of the Company). Any such reimbursements will not exceed actual expenses incurred by the Adviser and its affiliates. The Adviser is responsible for the payment of the Company’s organization and offering expenses to the extent that these expenses exceed 1.5% of the aggregate gross offering proceeds, without recourse against or reimbursement by the Company.

For the three months ended March 31, 2022, subject to the 1.5% organization and offering cost cap, the Company did not accrue initial organization and offering expenses. For the three months ended March 31, 2021, subject to the 1.5% organization and offering cost cap, the Company accrued initial organization and offering expenses of $0.1 million.

From time to time, the Adviser may pay amounts owed by the Company to third-party providers of goods or services, including the Board, and the Company will subsequently reimburse the Adviser for such amounts paid on its behalf. Amounts payable to the Adviser are settled in the normal course of business without formal payment terms.

Affiliated Transactions

The Company may be prohibited under the 1940 Act from participating in certain transactions with its affiliates without prior approval of the directors who are not interested persons, and in some cases, the prior approval of the SEC. The Company, the Adviser and certain of their affiliates have been granted exemptive relief by the SEC for the Company to co-invest with other funds managed by the Adviser or certain of its affiliates, in a manner consistent with the Company’s investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. Pursuant to such exemptive relief, the Company generally is permitted to co-invest with certain of its affiliates if a “required majority” (as defined in Section 57(o) of the 1940 Act) of the Board make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transaction, including the consideration to be paid, are reasonable and fair to the Company and its shareholders and do not involve overreaching of the Company or its shareholders on the part of any person concerned, (2) the transaction is consistent with the interests of the Company’s shareholders and is consistent with its investment objective and strategies, (3) the investment by its affiliates would not disadvantage the Company, and the Company’s participation would not be on a basis different from or less advantageous than that on which its affiliates are investing and (4) the proposed investment by the Company would not benefit the Advisers or its affiliates or any affiliated person of any of them (other than the parties to the transaction), except to the extent permitted by the exemptive relief and applicable law, including the limitation set forth in Section 57(k) of the 1940 Act. The Adviser is affiliated with Owl Rock Technology Advisors LLC (“ORTA”), Owl Rock Capital Private Fund Advisors LLC (“ORPFA”), Owl Rock Technology Advisors II LLC ("ORTA II") and Owl Rock Diversified Advisors LLC (“ORDA” together with ORTA, ORPFA, ORTA II and the Adviser, the "Owl Rock Advisers"), which are also investment advisers. The Owl Rock Advisers are indirect affiliates of Blue Owl and comprise part of "Owl Rock," a division of Blue Owl focused on direct lending. The Owl Rock Advisers’ investment allocation policy seeks to ensure equitable allocation of investment opportunities over time between the Company and other funds managed by the Adviser or its affiliates. As a result of exemptive relief, there could be significant overlap in the Company’s investment portfolio and the investment portfolios of other funds managed by the Adviser or its affiliates that could avail themselves of such exemptive relief and that have an investment objective similar to the Company.

Dealer Manager Agreement

The Company has entered into a Dealer Manager Agreement (the “Dealer Manager Agreement”) with Blue Owl Securities LLC (formerly, Owl Rock Capital Securities LLC) (“Blue Owl Securities”), an affiliate of the Adviser. On October 1, 2019, the Company entered into the Follow-on Dealer Manager Agreement with Blue Owl Securities (together with the Original Dealer Manager Agreement, the “Dealer Manager Agreement”). The Company has determined not to file additional post-effective amendments to its registration statement and terminated its public offering and the Dealer Manager Agreement as of April 30, 2021. Under the terms of the Dealer Manager Agreement, Blue Owl Securities served as the dealer manager for the Company’s public offering of its shares of common stock. As dealer manager, Owl Rock Securities earned a maximum sales load of up to 5.0% of the price per share for combined upfront selling commissions and dealer manager fees, a portion or all of which may be reallowed to selling broker-dealers. In connection with purchases of shares pursuant to the Company’s distribution reinvestment plan, the upfront selling commissions and dealer manager fees were not paid.

Blue Owl Securities is a broker-dealer registered with the SEC, a member of the Financial Industry Regulatory Authority and a member of the Securities Investor Protection Corporation.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Expense Support and Conditional Reimbursement Agreement

On February 6, 2017, the Company entered into an Expense Support and Conditional Reimbursement Agreement (the “Expense Support Agreement”) with the Adviser, the purpose of which is to ensure that no portion of the Company’s distributions to shareholders will represent a return of capital for U.S. federal income tax purposes. The Expense Support Agreement became effective as of April 4, 2017, the date that the Company met the minimum offering requirement.

On a quarterly basis, the Adviser reimburses the Company for “Operating Expenses” (as defined below) in an amount equal to the excess of the Company’s cumulative distributions paid to the Company’s shareholders in each quarter over “Available Operating Funds” (as defined below) received by the Company on account of its investment portfolio during such quarter. Any payments required to be made by the Adviser pursuant to the preceding sentence are referred to herein as an “Expense Payment”.

Pursuant to the Expense Support Agreement, “Operating Expenses” means all of the Company’s operating costs and expenses incurred, as determined in accordance with U.S. GAAP for investment companies. “Available Operating Funds” means the sum of (i) the Company’s estimated investment company taxable income (including realized net short-term capital gains reduced by realized net long-term capital losses), (ii) the Company’s realized net capital gains (including the excess of realized net long-term capital gains over realized net short-term capital losses) and (iii) dividends and other distributions paid to the Company on account of preferred and common equity investments in portfolio companies, if any (to the extent such amounts listed in clause (iii) are not included under clauses (i) and (ii) above).

The Adviser’s obligation to make an Expense Payment will automatically become a liability of the Adviser and the right to such Expense Payment will be an asset of the Company on the last business day of the applicable quarter. The Expense Payment for any quarter will be paid by the Adviser to the Company in any combination of cash or other immediately available funds, and/or offset against amounts due from the Company to the Adviser no later than the earlier of (i) the date on which the Company closes its books for such quarter, or (ii) forty-five days after the end of such quarter.

Following any quarter in which Available Operating Funds exceed the cumulative distributions paid by the Company in respect of such quarter (the amount of such excess being hereinafter referred to as “Excess Operating Funds”), the Company will pay such Excess Operating Funds, or a portion thereof, in accordance with the stipulations below, as applicable, to the Adviser, until such time as all Expense Payments made by the Adviser to the Company within three years prior to the last business day of such quarter have been reimbursed. Any payments required to be made by the Company are referred to as a “Reimbursement Payment”.

The amount of the Reimbursement Payment for any quarter shall equal the lesser of (i) the Excess Operating Funds in respect of such quarter and (ii) the aggregate amount of all Expense Payments made by the Adviser to the Company within three years prior to the last business day of such quarter that have not been previously reimbursed by the Company to the Adviser. The payment will be reduced to the extent that such Reimbursement Payments, together with all other Reimbursement Payments paid during the fiscal year, would cause Other Operating Expenses defined as the Company’s total Operating Expenses, excluding base management fees, incentive fees, organization and offering expenses, distribution and shareholder servicing fees, financing fees and costs, interest expense, brokerage commissions and extraordinary expenses (on an annualized basis and net of any Expense Payments received by the Company during the fiscal year) to exceed the lesser of: (i) 1.75% of the Company’s average net assets attributable to the shares of the Company’s common stock for the fiscal year-to-date period after taking such Expense Payments into account; and (ii) the percentage of the Company’s average net assets attributable to shares of the Company’s common stock represented by Other Operating Expenses during the fiscal year in which such Expense Payment was made (provided, however, that this clause (ii) shall not apply to any Reimbursement Payment which relates to an Expense Payment made during the same fiscal year).

No Reimbursement Payment for any quarter will be made if: (1) the “Effective Rate of Distributions Per Share” (as defined below) declared by the Company at the time of such Reimbursement Payment is less than the Effective Rate of Distributions Per Share at the time the Expense Payment was made to which such Reimbursement Payment relates, or (2) the Company’s “Operating Expense Ratio” (as defined below) at the time of such Reimbursement Payment is greater than the Operating Expense Ratio at the time the Expense Payment was made to which such Reimbursement Payment relates. Pursuant to the Expense Support Agreement, “Effective Rate of Distributions Per Share” means the annualized rate (based on a 365 day year) of regular cash distributions per share exclusive of returns of capital, distribution rate reductions due to distribution and shareholder fees, and declared special dividends or special distributions, if any. The “Operating Expense Ratio” is calculated by dividing Operating Expenses, less organizational and offering expenses, base management and incentive fees owed to Adviser, and interest expense, by the Company’s net assets.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

The specific amount of expenses reimbursed by the Adviser, if any, will be determined at the end of each quarter. The Company or the Adviser may terminate the Expense Support Agreement at any time, with or without notice. The Expense Support Agreement will automatically terminate in the event of (a) the termination of the Investment Advisory Agreement, or (b) the Board of the Company making a determination to dissolve or liquidate the Company. Upon termination of the Expense Support Agreement, the Company will be required to fund any Expense Payments, subject to the aforementioned requirements per the Expense Support Agreement, that have not been reimbursed by the Company to the Adviser.

As of March 31, 2022, the amount of Expense Support Payments provided by the Adviser since inception is $32.8 million. During the three months ended March 31, 2022 and 2021, the Company did not repay expense support to the Adviser. The Company may or may not reimburse remaining expense support in the future.

The following table presents a summary of all expenses supported, and recouped, by the Adviser for each of the following three month periods in which the Company received Expense Support from the Adviser and the associated dates through which such expenses may be subject to reimbursement from the Company pursuant to the Expense Support Agreement:


For the Quarter Ended	Amount of Expense Support		Recoupment of Expense Support		Expired Expense Support		Unreimbursed Expense Support		Effective Rate of Distribution per Share(1)	Reimbursement Eligibility Expiration	Operating Expense Ratio(2)
($ in thousands)
June 30, 2017	$	1,061	$	1,061	$	—	$	—	7.0%	N/A	16.81%
September 30, 2017		1,023		258		765		—	7.0%	September 30, 2020	6.15%
December 31, 2017		856		—		856		—	7.0%	December 31, 2020	2.83%
March 31, 2018		1,871		—		1,871		—	6.9%	March 31, 2021	2.27%
June 30, 2018		775		—		775		—	6.9%	June 30, 2021	1.53%
March 31, 2019		1,835		—		1,835		—	7.0%	March 31, 2022	0.91%
June 30, 2019		1,776		—		—		1,776	7.0%	June 30, 2022	0.79%
September 30, 2019		1,081		—		—		1,081	7.0%	September 30, 2022	0.72%
December 31, 2019		2,351		—		—		2,351	7.0%	December 31, 2022	0.69%
March 31, 2020		6,587		—		—		6,587	7.7%	March 31, 2023	0.70%
June 30, 2020		5,794		—		—		5,794	7.4%	June 30, 2023	0.70%
September 30, 2020		3,079		—		—		3,079	7.2%	September 30, 2023	0.63%
December 31, 2020		3,216		3,216		—		—	6.5%	N/A	0.71%
March 31, 2021		1,449		—		—		1,449	6.4%	March 31, 2024	0.60%
Total	$	32,754	$	4,535	$	6,102	$	22,117

________________

(1)

The effective rate of distribution per share is expressed as a percentage equal to the projected annualized distribution amount as of the end of the applicable period (which is calculated by annualizing the regular weekly or monthly cash distributions per share as of such date without compounding), divided by the Company’s gross offering price per share as of such date.

(2)

The operating expense ratio is calculated by dividing operating expenses, less organizational and offering expenses, base management and incentive fees owed to the Adviser, and interest expense, by the Company’s net assets.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

License Agreement

The Company has entered into a license agreement (the “License Agreement”), pursuant to which an affiliate of Blue Owl has granted the Company a non-exclusive license to use the name “Owl Rock.” Under the License Agreement, the Company has a right to use the Owl Rock name for so long as the Adviser or one of its affiliates remains the Company’s investment adviser. Other than with respect to this limited license, the Company will have no legal right to the “Owl Rock” name or logo.

Non-Controlled/Affiliated Portfolio Companies

Under the 1940 Act, the Company is required to separately identify non-controlled investments where it owns 5% or more of a portfolio company’s outstanding voting securities and/or has the power to exercise control over the management or policies of such portfolio company as investments in “affiliated” companies. In addition, under the 1940 Act, the Company is required to separately identify investments where it owns more than 25% of a portfolio company’s outstanding voting securities and/or has the power to exercise control over the management or policies of such portfolio company as investments in “controlled” companies. Under the 1940 Act, "non-affiliated investments" are defined as investments that are neither controlled investments nor affiliated investments. Detailed information with respect to the Company’s non-controlled, non-affiliated; non-controlled, affiliated; and controlled affiliated investments is contained in the accompanying consolidated financial statements, including the consolidated schedule of investments.

Promissory Note

On May 18, 2017, the Board authorized the Company, as Borrower, to enter into a series of promissory notes (the “Promissory Notes”) with the Adviser. The Promissory Notes matured on December 31, 2020. See Note 6 “Debt”.

Note 4. Investments

The information in the tables below is presented on an aggregate portfolio basis, without regard to whether they are non-controlled non-affiliated, non-controlled affiliated or controlled affiliated investments.

Investments at fair value and amortized cost consisted of the following as of March 31, 2022 and December 31, 2021:


	March 31, 2022				December 31, 2021
($ in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
First-lien senior secured debt investments	$	1,762,387	$	1,753,382	$	1,785,730	$	1,784,326
Second-lien senior secured debt investments		483,643		481,553		482,323		484,500
Unsecured debt investments		36,604		35,175		34,524		34,133
Preferred equity investments		46,135		46,259		48,397		49,313
Common equity investments		51,275		68,317		50,226		67,256
Total Investments	$	2,380,044	$	2,384,686	$	2,401,200	$	2,419,528

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

The industry composition of investments based on fair value as of March 31, 2022 and December 31, 2021 was as follows:


	March 31, 2022			December 31, 2021
Advertising and media		0.6	%		0.6	%
Aerospace and defense		3.3			3.3
Automotive		1.5			1.4
Buildings and real estate		4.6			5.0
Business services		3.8			3.7
Chemicals		3.3			3.3
Consumer products		4.4			4.8
Containers and packaging		1.3			1.3
Distribution		3.3			3.1
Education		1.1			1.1
Financial services		6.3			6.2
Food and beverage		7.4			7.3
Healthcare equipment and services		3.8			3.7
Healthcare providers and services		7.5			8.1
Healthcare technology		5.8			5.9
Household products		1.9			1.8
Human resource support services		1.3			1.3
Infrastructure and environmental services		0.5			0.5
Insurance		7.6			7.4
Internet software and services		13.0			12.7
Leisure and entertainment		2.6			2.5
Manufacturing		6.3			6.3
Oil and gas		1.1			1.1
Professional services		2.0			2.0
Specialty retail		2.8			2.8
Transportation		2.9			2.8
Total		100.0	%		100.0	%

The geographic composition of investments based on fair value as of March 31, 2022 and December 31, 2021 was as follows:


	March 31, 2022			December 31, 2021
United States:
Midwest		17.3	%		17.1	%
Northeast		16.6			16.7
South		36.8			37.3
West		22.1			21.9
International		7.2			7.0
Total		100.0	%		100.0	%

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 5. Fair Value of Investments

Investments

The following tables present the fair value hierarchy of investments as of March 31, 2022 and December 31, 2021:


	Fair Value Hierarchy as of March 31, 2022
($ in thousands)	Level 1		Level 2		Level 3		Total
First-lien senior secured debt investments	$	—	$	74	$	1,753,308	$	1,753,382
Second-lien senior secured debt investments		—		25,800		455,753		481,553
Unsecured debt investments		—		—		35,175		35,175
Preferred equity investments		—		—		46,259		46,259
Common equity investments		268		—		68,049		68,317
Total Investments	$	268	$	25,874	$	2,358,544	$	2,384,686


	Fair Value Hierarchy as of December 31, 2021
($ in thousands)	Level 1		Level 2		Level 3		Total
First-lien senior secured debt investments	$	—	$	1	$	1,784,325	$	1,784,326
Second-lien senior secured debt investments		—		—		484,500		484,500
Unsecured debt investments		—		—		34,133		34,133
Preferred equity investments		—		—		49,313		49,313
Common equity investments		861		—		66,395		67,256
Total Investments	$	861	$	1	$	2,418,666	$	2,419,528

The following tables present changes in the fair value of investments for which Level 3 inputs were used to determine the fair value as of and for the three months ended March 31, 2022 and 2021:


	As of and for the Three Months Ended March 31, 2022
($ in thousands)	First-lien senior secured debt investments			Second-lien senior secured debt investments			Unsecured debt investments			Preferred equity investments			Common equity investments		Total
Fair value, beginning of period	$	1,784,325		$	484,500		$	34,133		$	49,313		$	66,395	$	2,418,666
Purchases of investments, net		49,462			979			986			1,036			1,020		53,483
Payment-in-kind		3,043			577			1,074			712			29		5,435
Proceeds from investments, net		(77,798	)		—			—			(4,900	)		—		(82,698	)
Net change in unrealized gain (loss) on investments		(7,599	)		(4,116	)		(1,038	)		(792	)		605		(12,940	)
Net realized gain (loss) on investments		23			—			—			773			—		796
Net amortization of discount on investments		1,925			189			20			117			—		2,251
Transfers into (out of) Level 3(1)		(73	)		(26,376	)		—			—			—		(26,449	)
Fair value, end of period	$	1,753,308		$	455,753		$	35,175		$	46,259		$	68,049	$	2,358,544

________________

(1)

Transfers between levels, if any, are recognized at the beginning of the period in which the transfers occur. For the three months ended March 31, 2022, transfers into Level 3 were as a result of changes in the observability of significant inputs for certain portfolio companies.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued


	As of and for the Three Months Ended March 31, 2021
($ in thousands)	First-lien senior secured debt investments			Second-lien senior secured debt investments			Unsecured debt investments			Preferred equity investments(2)		Common equity investments(2)		Total
Fair value, beginning of period	$	1,542,401		$	472,245		$	7,182		$	—	$	40,558	$	2,062,386
Purchases of investments, net		128,351			7,495			26,027			1,370		—		163,243
Payment-in-kind		1,750			—			254			—		141		2,145
Proceeds from investments, net		(65,623	)		(24,372	)		—			—		—		(89,995	)
Net change in unrealized gain (loss) on investments		6,961			1,695			(161	)		—		3,381		11,876
Net realized gain (loss) on investments		146			—			—			—		—		146
Net amortization of discount on investments		1,697			551			4			—		3		2,255
Transfers into (out of) Level 3(1)		125			—			—			—		—		125
Fair value, end of period	$	1,615,808		$	457,614		$	33,306		$	1,370	$	44,083	$	2,152,181

________________

(1)

Transfers between levels, if any, are recognized at the beginning of the period in which the transfers occur.

(2)

As of and for the three months ended March 31, 2021, preferred equity investments and common equity investments were reported in aggregate as equity investments.

The following tables present information with respect to the net change in unrealized gains (losses) on investments for which Level 3 inputs were used in determining the fair value that are still held by the Company for the three months ended March 31, 2022 and 2021:


($ in thousands)	Net change in unrealized gain (loss) for the Three Months Ended March 31, 2022 on Investments Held at March 31, 2022			Net change in unrealized gain (loss) for the Three Months Ended March 31, 2021 on Investments Held at March 31, 2021(1)
First-lien senior secured debt investments	$	(6,932	)	$	7,585
Second-lien senior secured debt investments		(4,106	)		1,877
Unsecured debt investments		(1,039	)		(164	)
Preferred equity investments		(735	)		6
Common equity investments		814			3,375
Total Investments	$	(11,998	)	$	12,679

________________

(1)

For the three months ended March 31, 2021, preferred equity investments and common equity investments were reported in aggregate as equity investments.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

The following tables present quantitative information about the significant unobservable inputs of the Company’s Level 3 investments as of March 31, 2022 and December 31, 2021. The weighted average range of unobservable inputs is based on fair value of investments. The tables are not intended to be all-inclusive, but instead capture the significant unobservable inputs relevant to the Company’s determination of fair value.

As of March 31, 2022

($ in thousands)

Fair Value

Valuation Technique

Unobservable Input

Range (Weighted Average)

Impact to Valuation from an Increase in Input

First-lien senior secured debt investments

1,722,329

Yield Analysis

Market Yield

6.2% - 21.3% (9.9%)

Decrease

30,979

Recent Transaction

Transaction Price

81.2% - 100.0% (98.0%)

Increase

Second-lien senior secured debt investments

452,469

Yield Analysis

Market Yield

9.7% - 14.7% (11.4%)

Decrease

2,304

Collateral Analysis

Recovery Rate

20.5% - 20.5% (20.5%)

Increase

980

Recent Transaction

Transaction Price

98.0% - 98.0% (98.0%)

Increase

Unsecured debt investments(1)

32,723

Yield Analysis

Market Yield

8.1% - 10.5% (10.0%)

Decrease

994

Recent Transaction

Transaction Price

99.3% - 99.3% (99.3%)

Increase

820

Market Approach

EBITDA Multiple

14.8x - 14.8x (14.8x)

Increase

Preferred equity investments

45,257

Yield Analysis

Market Yield

10.8% - 13.0% (12.0%)

Decrease

1,002

Recent Transaction

Transaction Price

98.0% - 100.0% (98.0%)

Increase

Common equity investments

66,930

Market Approach

EBITDA Multiple

4.4x - 23.8x (8.6x)

Increase

1,018

Recent Transaction

Transaction Price

100.0% - 100.0% (100.0%)

Increase

101

Market Approach

Gross Profit Multiple

22.0x - 22.0x (22.0x)

Increase

________________

(1)

Excludes Level 3 unsecured debt investments with an aggregate fair value amounting to $638 thousand, which the Company valued using indicative bid prices obtained from brokers.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

As of December 31, 2021

($ in thousands)

Fair Value

Valuation Technique

Unobservable Input

Range (Weighted Average)

Impact to Valuation from an Increase in Input

First-lien senior secured debt investments

1,610,509

Yield Analysis

Market Yield

5.3% - 20.0% (8.5%)

Decrease

173,816

Recent Transaction

Transaction Price

90.5% - 99.4% (97.4%)

Increase

Second-lien senior secured debt investments(1)

388,588

Yield Analysis

Market Yield

7.8% - 11.3% (9.3%)

Decrease

74,306

Recent Transaction

Transaction Price

98.0% - 99.0% (98.6%)

Increase

2,809

Collateral Analysis

Recovery Rate

25.0% - 25.0% (25.0%)

Increase

Unsecured debt investments(2)

820

Market Approach

EBITDA Multiple

14.8x - 14.8x (14.8x)

Increase

32,688

Yield Analysis

Market Yield

7.2% - 9.4% (9.0%)

Decrease

Preferred equity investments

37,046

Yield Analysis

Market Yield

11.4% - 14.6% (11.7%)

Decrease

11,552

Recent Transaction

Transaction Price

97.3% - 100.0% (98.3%)

Increase

715

Market Approach

EBITDA Multiple

9.3x - 9.3x (9.3x)

Increase

Common equity investments

57,113

Market Approach

EBITDA Multiple

4.0x - 24.0x (7.6x)

Increase

157

Market Approach

Gross Profit Multiple

27.0x - 27.0x (27.0x)

Increase

9,125

Recent Transaction

Transaction Price

100.0% - 100.0% (100.0%)

Increase

________________

(1)

Excludes Level 3 second-lien investments with an aggregate fair value amounting to $18,797, which the Company valued using indicative bid prices obtained from brokers.

(2)

Excludes Level 3 unsecured debt investments with an aggregate fair value amounting to $625, which the Company valued using indicative bid prices obtained from brokers.

The Company typically determines the fair value of its performing Level 3 debt investments utilizing a yield analysis. In a yield analysis, a price is ascribed for each investment based upon an assessment of current and expected market yields for similar investments and risk profiles. Additional consideration is given to the expected life, portfolio company performance since close, and other terms and risks associated with an investment. Among other factors, a determinant of risk is the amount of leverage used by the portfolio company relative to its total enterprise value, and the rights and remedies of the Company’s investment within the portfolio company’s capital structure.

Significant unobservable quantitative inputs typically used in the fair value measurement of the Company’s Level 3 debt investments primarily include current market yields, including relevant market indices, but may also include quotes from brokers, dealers, and pricing services as indicated by comparable investments. For the Company’s Level 3 equity investments, a market approach, based on comparable publicly-traded company and comparable market transaction multiples of revenues, earnings before income taxes, depreciation and amortization (“EBITDA”), or some combination thereof and comparable market transactions typically would be used.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Debt Not Carried at Fair Value

Fair value is estimated by discounting remaining payments using applicable current market rates, which take into account changes in the Company’s marketplace credit ratings, or market quotes, if available. The following table presents the carrying and fair values of the Company’s debt obligations as of March 31, 2022 and December 31, 2021.


	March 31, 2022				December 31, 2021
($ in thousands)	Net Carrying Value(1)		Fair Value		Net Carrying Value(2)		Fair Value
SPV Asset Facility I	$	466,681	$	466,681	$	411,474	$	411,474
SPV Asset Facility II		151,043		151,043		252,179		252,179
2024 Notes		450,269		446,625		450,292		470,250
Total Debt	$	1,067,993	$	1,064,349	$	1,113,945	$	1,133,903

________________

(1)

The carrying value of the Company’s SPV Asset Facility I, SPV Asset Facility II, and 2024 Notes are presented net of deferred financing costs of $0.5 million, $4.0 million and $(0.3) million, respectively.

(2)

The carrying value of the Company’s SPV Asset Facility I, SPV Asset Facility II and 2024 Notes are presented net of deferred financing costs of $0.7 million, $2.8 million and $(0.3) million, respectively.

The following table presents fair value measurements of the Company’s debt obligations as of March 31, 2022 and December 31, 2021:


($ in thousands)	March 31, 2022		December 31, 2021
Level 1	$	—	$	—
Level 2		446,625		470,250
Level 3		617,724		663,653
Total Debt	$	1,064,349	$	1,133,903

Financial Instruments Not Carried at Fair Value

As of March 31, 2022 and December 31, 2021, the carrying amounts of the Company’s assets and liabilities, other than investments at fair value and debt, approximate fair value due to their short maturities.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 6. Debt

In accordance with the 1940 Act, with certain limitations, the Company is allowed to borrow amounts such that its asset coverage, as defined in the 1940 Act, is at least 200% (or 150% if certain conditions are met) after such borrowing. The Company’s asset coverage was 224% and 221% as of March 31, 2022 and December 31, 2021, respectively.

Debt obligations consisted of the following as of March 31, 2022 and December 31, 2021:


	March 31, 2022
($ in thousands)	Aggregate Principal Committed		Outstanding Principal		Amount Available(1)		Net Carrying Value(2)
SPV Asset Facility I	$	500,000	$	467,227	$	15,809	$	466,681
SPV Asset Facility II		325,000		155,000		128,491		151,043
2024 Notes		450,000		450,000		—		450,269
Total Debt	$	1,275,000	$	1,072,227	$	144,300	$	1,067,993

________________

(1)

The amount available reflects any limitations related to each credit facility’s borrow base.

(2)

The carrying value of the Company’s SPV Asset Facility I, SPV Asset Facility II and 2024 Notes are presented net of deferred financing costs of $0.5 million, $4.0 million and $(0.3) million, respectively.


	December 31, 2021
($ in thousands)	Aggregate Principal Committed		Outstanding Principal		Amount Available(1)		Net Carrying Value(2)
SPV Asset Facility I	$	500,000	$	412,182	$	18,513	$	411,474
SPV Asset Facility II		325,000		255,000		49,078		252,179
2024 Notes		450,000		450,000		—		450,292
Total Debt	$	1,275,000	$	1,117,182	$	67,591	$	1,113,945

________________

(1)

The amount available reflects any limitations related to each credit facility’s borrow base.

(2)

The carrying value of the Company’s SPV Asset Facility I, SPV Asset Facility II and 2024 Notes are presented net of deferred unamortized debt issuance costs of $0.7 million, $2.8 million and $(0.3) million.

For the three months ended March 31, 2022 and 2021, the components of interest expense were as follows:


	For the Three Months Ended March 31,
($ in thousands)	2022			2021
Interest expense	$	9,915		$	7,749
Amortization of debt issuance costs		342			771
Total Interest Expense	$	10,257		$	8,520
Average interest rate		3.5	%		3.4	%
Average daily borrowings	$	1,098,056		$	873,911

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

SPV Asset Facility I

On December 1, 2017 (the “SPV Asset Facility I Closing Date”), ORCC II Financing LLC and OR Lending II LLC (collectively, the “Subsidiaries”), each a Delaware limited liability company and a wholly-owned subsidiary of the Company, entered into a Credit Agreement (the “SPV Asset Facility I”). Parties to the SPV Asset Facility I include ORCC II Financing LLC and OR Lending II LLC, as Borrowers, and the lenders from time to time parties thereto (the “SPV I Lenders”), Goldman Sachs Bank USA as Sole Lead Arranger, Syndication Agent and Administrative Agent, State Street Bank and Trust Company as Collateral Administrator and Collateral Agent and Cortland Capital Market Services LLC as Collateral Custodian. From time to time, the parties to the SPV Asset Facility I have amended the SPV Asset Facility I and the related transaction documents.

The summary below reflects the terms of the SPV Asset Facility I as amended from time to time, including by Amendment No. 1 to the Second Amended and Restated Credit Agreement, entered into on July 13, 2021, by the parties to the SPV Asset Facility I.

From time to time, the Company sells and contributes certain investments to ORCC II Financing LLC pursuant to a Sale and Contribution Agreement by and between the Company and ORCC II Financing LLC. No gain or loss will be recognized as a result of these sales and contributions. Proceeds from the SPV Asset Facility I have been and will be used to finance the origination and acquisition of eligible assets by the Subsidiaries, including the purchase of such assets from the Company. The Company retains a residual interest in assets contributed to or acquired by the Subsidiaries through its ownership of the Subsidiaries. The maximum principal amount of the SPV Asset Facility I is $500 million; the availability of this amount is subject to a borrowing base test, which is based on the amount of the Subsidiaries’ assets from time to time, and satisfaction of certain conditions, including certain concentration limits.

The SPV Asset Facility I provides for a reinvestment period up to and including November 30, 2022 (the “SPV Asset Facility I Commitment Termination Date”). Prior to the SPV Asset Facility I Commitment Termination Date, proceeds received by the Subsidiaries from interest, dividends, or fees on assets must be used to pay expenses and interest on outstanding borrowings, and the excess may be returned to the Company, subject to certain conditions. Proceeds received from principal on assets prior to the SPV Asset Facility I Commitment Termination Date must be used to make quarterly payments of principal on outstanding borrowings. Following the SPV Asset Facility I Commitment Termination Date, proceeds received by the Subsidiaries from interest and principal on collateral assets must be used to make quarterly payments of principal on outstanding borrowings. Subject to certain conditions, between quarterly payment dates prior to and after the SPV Asset Facility I Commitment Termination Date, excess interest proceeds and principal proceeds may be released to the Subsidiaries to make distributions to the Company.

The SPV Asset Facility I will mature on November 30, 2023. Amounts drawn bear interest at LIBOR plus a 2.25% spread and after a ramp-up period, the spread is also payable on any undrawn amounts. The Company borrows utilizing three-month LIBOR rate loans. If LIBOR ceases to exist, a waterfall of replacement rates will apply to SPV Asset Facility I, unless the Company, the Administrative Agent and the lenders negotiate a different replacement rate. The SPV Asset Facility I contains customary covenants, including certain financial maintenance covenants, limitations on the activities of the Subsidiaries, including limitations on incurrence of incremental indebtedness, and customary events of default. The SPV Asset Facility I is secured by a perfected first priority security interest in the Company’s equity interests in the Subsidiaries and in the assets of the Subsidiaries and on any payments received by the Subsidiaries in respect of those assets. Upon the occurrence of certain value adjustment events relating to the assets securing the SPV Asset Facility I, the Subsidiaries will also be required to provide certain cash collateral. Assets pledged to the SPV I Lenders will not be available to pay the debts of the Company.

Borrowings of the Subsidiaries are considered the Company’s borrowings for purposes of complying with the asset coverage requirements under the 1940 Act.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

In connection with the SPV Asset Facility I, the Company entered into a Non-Recourse Carveout Guaranty Agreement on the SPV Asset Facility I Closing Date, which was amended and restated twice on March 11, 2019 and April 29, 2019, with State Street Bank and Trust Company, on behalf of certain secured parties, and Goldman Sachs Bank USA. Pursuant to the Non-Recourse Carveout Guaranty Agreement, the Company guarantees certain losses, damages, costs, expenses, liabilities, claims and other obligations incurred in connection with certain instances of fraud or bad faith misrepresentation, material encumbrances of certain collateral, misappropriation of certain funds, certain transfers of assets, and the bad faith or willful breach of certain provisions of the SPV Asset Facility I.

SPV Asset Facility II

On April 14, 2020 (the “SPV Asset Facility II Closing Date”), ORCC II Financing II LLC (“ORCC II Financing II”), a Delaware limited liability company and newly formed subsidiary of the Company entered into a Credit Agreement (the “SPV Asset Facility II”), with ORCC II Financing II, as Borrower, the lenders from time to time parties thereto (the “SPV II Lenders”), Natixis, New York Branch, as Administrative Agent, State Street Bank and Trust Company as Collateral Agent and Cortland Capital Market Services LLC as Document Custodian. The parties to the SPV Asset Facility II have entered into various amendments, including to increase the maximum principal amount of the SPV Asset Facility II, change the interest rates for amounts drawn in U.S. dollars, to extend the maturity of the SPV Asset Facility II to convert the benchmark rate of the facility from LIBOR to Term SOFR and make certain other changes. The summary below reflects the terms of the SPV Asset Facility II as amended through March 25, 2022.

From time to time, the Company expects to sell and contribute certain investments to ORCC II Financing II pursuant to a Sale and Contribution Agreement by and between the Company and ORCC II Financing II. No gain or loss will be recognized as a result of these sales and contributions. Proceeds from the SPV Asset Facility II will be used to finance the origination and acquisition of eligible assets by ORCC II Financing II, including the purchase of such assets from the Company. The Company retains a residual interest in assets contributed to or acquired by ORCC II Financing II through the Company’s ownership of ORCC II Financing II. The maximum principal amount of the SPV Asset Facility II is $325 million; the availability of this amount is subject to an overcollateralization ratio test, which is based on the value of ORCC II Financing II’s assets from time to time, and satisfaction of certain conditions, including an interest coverage ratio test, certain concentration limits and collateral quality tests.

The SPV Asset Facility II provides for the ability to (1) draw term loans and (2) draw and redraw revolving loans under the SPV Asset Facility II for a period of up to two years after the SPV Asset Facility II Closing Date unless the revolving commitments are terminated or converted to term loans sooner as provided in the SPV Asset Facility II (the “SPV Asset Facility II Commitment Termination Date”). Unless otherwise terminated, the SPV Asset Facility II will mature on April 14, 2030 (the “Stated Maturity”). Prior to the Stated Maturity, proceeds received by ORCC II Financing II from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to the Company, subject to certain conditions. On the Stated Maturity, ORCC II Financing II must pay in full all outstanding fees and expenses and all principal and interest on outstanding borrowings, and the excess may be returned to the Company.

Amounts drawn bear interest at Term SOFR (or, in the case of certain lenders that are commercial paper conduits, the lower of their cost of funds and Term SOFR plus 0.25%) plus, (x) with respect to revolving loans, 2.50% and (y) with respect to term loans, 2.50% during the SPV Asset Facility II’s reinvestment period and 2.50% thereafter. From the SPV Asset Facility II Closing Date to the SPV Asset Facility II Commitment Termination Date, there is a commitment fee that steps up during the year after the SPV Closing Date from 0.00% to 0.75% per annum on the undrawn amount, if any, of the revolving commitments in the SPV Asset Facility II. The SPV Asset Facility II contains customary covenants, including certain financial maintenance covenants, limitations on the activities of ORCC II Financing II, including limitations on incurrence of incremental indebtedness, and customary events of default. The SPV Asset Facility II is secured by a perfected first priority security interest in the assets of ORCC II Financing II and on any payments received by ORCC II Financing II in respect of those assets. Assets pledged to the SPV II Lenders will not be available to pay the debts of the Company.

Borrowings of ORCC II Financing II are considered the Company’s borrowings for purposes of complying with the asset coverage requirements under the 1940 Act.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Promissory Note

On May 18, 2017, the Board authorized the Company, as borrower, to enter into a series of Promissory Notes with the Adviser, as lender, to borrow up to an aggregate of $10 million from the Adviser. On October 19, 2017, the Board increased the approved amount to an aggregate of $15 million. On March 2, 2018, the Board increased the approved amount to an aggregate of $20 million. On July 19, 2018, the Board increased the approved amount to an aggregate of $35 million. On March 8, 2019, the Board increased the approved amount to an aggregate of $50 million. The borrower may re-borrow any amount repaid; however, there is no funding commitment between the Adviser and the Company.

The interest rate on any such borrowing may be based on either the rate of interest for a LIBOR-Based Advance or the rate of interest for a Prime-Based Advance under the Loan and Security Agreement, dated as of February 22, 2017, as amended as of August 1, 2017 (as further amended or supplemented from time to time, the “Loan Agreement”), by and among the Lender, as borrower, and East West Bank.

The unpaid principal balance of any Promissory Notes and accrued interest thereon is payable by the Company from time to time at the discretion of the Company but immediately due and payable upon 120 days written notice by the Adviser, and in any event due and payable in full no later than January 15, 2018. On November 7, 2017, the Board approved a modification to the Promissory Notes which extended the original maturity date to December 31, 2018. On November 6, 2018, the Board approved an additional modification to the Promissory Notes which further extended the maturity date to December 31, 2019. On October 30, 2019, the Board approved an additional modification to the Promissory Notes which further extended the maturity date to December 31, 2020. The Company intends to use the borrowed funds to leverage its current investment portfolio and to make investments in portfolio companies consistent with its investment strategies. The Promissory Notes matured on December 31, 2020.

The unpaid principal balance of the Promissory Notes and accrued interest thereon was paid in full on December 15, 2020 and December 31, 2020, respectively. The Company used the borrowed funds to leverage its investment portfolio and to make investments in portfolio companies consistent with its investment strategies.

2024 Notes

On November 26, 2019, the Company issued $300 million aggregate principal amount of the Company’s 4.625% notes due November 26, 2024 (the “2024 Notes”) in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and for initial resale to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act.

On October 21, 2020, the Company issued an additional $50 million aggregate principal amount of the Company’s 4.625% notes due 2024 and on May 5, 2021, the Company issued an additional $100 million aggregate principal amount of the Company’s 4.625% notes due 2024 (collectively, the “Additional 2024 Notes” and together with the Existing 2024 Notes, the “2024 Notes”) in a private placement in reliance on Section 4(a)(2) of the Securities Act, and for initial resale to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act. The Additional 2024 Notes will be treated as a single series with the Existing 2024 Notes and will have the same terms as the Existing 2024 Notes.

The 2024 Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

The 2024 Notes were issued pursuant to an Indenture dated as of November 26, 2019 (the “Base Indenture”), between the Company and Wells Fargo Bank, National Association, as trustee (the “Trustee”), and a First Supplemental Indenture, dated as of November 26, 2019 (the “First Supplemental Indenture” and together with the Base Indenture, the “Indenture”), between the Company and the Trustee. The 2024 Notes will mature on November 26, 2024, unless repurchased or redeemed in accordance with their terms prior to such date. The 2024 Notes bear interest at a rate of 4.625% per year payable semi-annually on May 26 and November 26 of each year, commencing on May 26, 2020. The 2024 Notes are the Company’s direct, general unsecured obligations and 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. The 2024 Notes rank pari passu, or equal, in right of payment with all of the Company’s existing and future indebtedness or other obligations that are not so subordinated. The 2024 Notes are effectively subordinated, or junior, to any of the Company’s future 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. The 2024 Notes are structurally subordinated, or junior, to all existing and future indebtedness and other obligations (including trade payables) incurred by the Company’s subsidiaries, financing vehicles or similar facilities.

The Indenture contains certain covenants, including covenants requiring us to (i) comply with the asset coverage requirements of the Investment Company Act of 1940, as amended, whether or not it is subject to those requirements, and (ii) provide financial information to the holders of the 2024 Notes and the Trustee if the Company is no longer subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the Indenture.

In addition, if a change of control repurchase event, as defined in the Indenture, occurs prior to maturity, holders of the 2024 Notes will have the right, at their option, to require the Company to repurchase for cash some or all of the 2024 Notes at a repurchase price equal to 100% of the aggregate principal amount of the 2024 Notes being repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 7. Commitments and Contingencies

Portfolio Company Commitments

From time to time, the Company may enter into commitments to fund investments. As of March 31, 2022 and December 31, 2021, the Company had the following outstanding commitments to fund investments in current portfolio companies:


Portfolio Company	Investment	March 31, 2022		December 31, 2021
($ in thousands)
3ES Innovation Inc. (dba Aucerna)	First lien senior secured revolving loan	$	687	$	687
ABB/Con-cise Optical Group LLC	First lien senior secured revolving loan		59		—
Alera Group, Inc.	First lien senior secured delayed draw term loan		94		94
AmSpec Group, Inc. (fka AmSpec Services Inc.)	First lien senior secured revolving loan		2,462		1,815
Apex Group Treasury, LLC	Second lien senior secured delayed draw term loan		6,618		6,618
Apptio, Inc.	First lien senior secured revolving loan		294		294
Aramsco, Inc.	First lien senior secured revolving loan		336		1,043
Ardonagh Midco 3 PLC	First lien senior secured GBP delayed draw term loan		577		593
Ascend Buyer, LLC (dba PPC Flexible Packaging)	First lien senior secured revolving loan		65		65
Associations, Inc.	First lien senior secured revolving loan		6,146		6,146
AxiomSL Group, Inc.	First lien senior secured delayed draw term loan		2,276		2,276
AxiomSL Group, Inc.	First lien senior secured revolving loan		3,496		3,496
Bayshore Intermediate #2, L.P. (dba Boomi)	First lien senior secured revolving loan		1,239		1,239
BCPE Osprey Buyer, Inc. (dba PartsSource)	First lien senior secured delayed draw term loan		345		345
BCPE Osprey Buyer, Inc. (dba PartsSource)	First lien senior secured revolving loan		52		52
BCTO BSI Buyer, Inc. (dba Buildertrend)	First lien senior secured revolving loan		444		444
BP Veraison Buyer, LLC (dba Sun World)	First lien senior secured delayed draw term loan		6,081		6,081
BP Veraison Buyer, LLC (dba Sun World)	First lien senior secured revolving loan		1,824		1,824

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued


Portfolio Company	Investment	March 31, 2022	December 31, 2021
Brightway Holdings, LLC	First lien senior secured revolving loan	526	526
Centrify Corporation	First lien senior secured revolving loan	1,345	1,345
CivicPlus, LLC	First lien senior secured revolving loan	59	59
CivicPlus, LLC	First lien senior secured delayed draw term loan	293	293
CSC Mkg Topco LLC (dba Medical Knowledge Group)	First lien senior secured revolving loan	112	—
Denali BuyerCo, LLC (dba Summit Companies)	First lien senior secured delayed draw term loan	347	513
Denali BuyerCo, LLC (dba Summit Companies)	First lien senior secured revolving loan	92	185
Diamondback Acquisition, Inc. (dba Sphera)	First lien senior secured delayed draw term loan	166	166
Dodge Data & Analytics LLC	First lien senior secured revolving loan	—	374
Douglas Products and Packaging Company LLC	First lien senior secured revolving loan	1,815	661
EET Buyer, Inc. (dba e-Emphasys)	First lien senior secured revolving loan	91	91
Entertainment Benefits Group, LLC	First lien senior secured revolving loan	2,800	2,800
Evolution BuyerCo, Inc. (dba SIAA)	First lien senior secured revolving loan	2,230	2,230
Forescout Technologies, Inc.	First lien senior secured revolving loan	700	700
Fortis Solutions Group, LLC	First lien senior secured delayed draw term loan	262	262
Fortis Solutions Group, LLC	First lien senior secured revolving loan	90	90
Gainsight, Inc.	First lien senior secured revolving loan	872	872
Galls, LLC	First lien senior secured revolving loan	2,361	3,336
Gaylord Chemical Company, L.L.C.	First lien senior secured revolving loan	2,609	2,609
Gerson Lehrman Group, Inc.	First lien senior secured revolving loan	2,039	2,039
GI Ranger Intermediate, LLC (dba Rectangle Health)	First lien senior secured delayed draw term loan	—	123
GI Ranger Intermediate, LLC (dba Rectangle Health)	First lien senior secured revolving loan	66	74
Global Music Rights, LLC	First lien senior secured revolving loan	83	83
GovBrands Intermediate, Inc.	First lien senior secured delayed draw term loan	259	259
GovBrands Intermediate, Inc.	First lien senior secured revolving loan	185	185
Guidehouse Inc.	First lien senior secured revolving loan	—	70
H&F Opportunities LUX III S.À R.L (dba Checkmarx)	First lien senior secured revolving loan	4,583	4,583
Hercules Borrower, LLC (dba The Vincit Group)	First lien senior secured revolving loan	2,986	3,343

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued


Portfolio Company	Investment	March 31, 2022	December 31, 2021
HGH Purchaser, Inc. (dba Horizon Services)	First lien senior secured delayed draw term loan	7,949	7,949
HGH Purchaser, Inc. (dba Horizon Services)	First lien senior secured revolving loan	866	1,758
Hometown Food Company	First lien senior secured revolving loan	471	471
Ideal Tridon Holdings, Inc.	First lien senior secured revolving loan	1,273	872
IG Investments Holdings, LLC (dba Insight Global)	First lien senior secured revolving loan	578	361
Individual Foodservice Holdings, LLC	First lien senior secured delayed draw term loan	—	1,440
Individual Foodservice Holdings, LLC	First lien senior secured revolving loan	3,724	4,328
Innovation Ventures HoldCo, LLC	First lien senior secured delayed draw term loan	400	—
Inovalon Holdings, Inc.	First lien senior secured delayed draw term loan	4,499	4,499
Integrity Marketing Acquisition, LLC	First lien senior secured revolving loan	1,868	1,868
Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)	First lien senior secured revolving loan	536	536
Interoperability Bidco, Inc. (dba Lyniate)	First lien senior secured revolving loan	652	1,000
IQN Holding Corp. (dba Beeline)	First lien senior secured revolving loan	2,612	2,612
KPSKY Acquisition, Inc. (dba BluSky)	First lien senior secured delayed draw term loan	51	51
Lazer Spot G B Holdings, Inc.	First lien senior secured revolving loan	7,089	7,542
Lignetics Investment Corp.	First lien senior secured delayed draw term loan	1,225	1,225
Lignetics Investment Corp.	First lien senior secured revolving loan	1,054	1,225
Litera Bidco LLC	First lien senior secured delayed draw term loan	913	913
Litera Bidco LLC	First lien senior secured revolving loan	1,013	1,013
MHE Intermediate Holdings, LLC (dba OnPoint Group)	First lien senior secured delayed draw term loan	1,132	1,132
MHE Intermediate Holdings, LLC (dba OnPoint Group)	First lien senior secured revolving loan	1,715	1,786
Milan Laser Holdings LLC	First lien senior secured revolving loan	1,961	1,961
MINDBODY, Inc.	First lien senior secured revolving loan	1,071	1,071
Ministry Brands Holdings, LLC	First lien senior secured delayed draw term loan	226	226
Ministry Brands Holdings, LLC	First lien senior secured revolving loan	68	68
National Dentex Labs LLC (fka Barracuda Dental LLC)	First lien senior secured delayed draw term loan	730	730
National Dentex Labs LLC (fka Barracuda Dental LLC)	First lien senior secured revolving loan	472	1,159
Natural Partners, LLC	First lien senior secured revolving loan	68	—

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued


Portfolio Company	Investment	March 31, 2022	December 31, 2021
Nelipak Holding Company	First lien senior secured revolving loan	512	512
Nelipak Holding Company	First lien senior secured revolving loan	878	897
NMI Acquisitionco, Inc. (dba Network Merchants)	First lien senior secured delayed draw term loan	538	538
NMI Acquisitionco, Inc. (dba Network Merchants)	First lien senior secured revolving loan	218	218
Norvax, LLC (dba GoHealth)	First lien senior secured revolving loan	614	614
Notorious Topco, LLC (dba Beauty Industry Group)	First lien senior secured delayed draw term loan	3,521	3,521
Notorious Topco, LLC (dba Beauty Industry Group)	First lien senior secured revolving loan	1,549	1,761
OB Hospitalist Group, Inc.	First lien senior secured revolving loan	2,931	2,618
Patriot Acquisition TopCo S.A.R.L (dba Corza Health, Inc.)	First lien senior secured revolving loan	2,654	2,654
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)	First lien senior secured delayed draw term loan	—	1,460
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)	First lien senior secured revolving loan	1,035	1,035
Pluralsight, LLC	First lien senior secured revolving loan	1,294	1,295
Project Power Buyer, LLC (dba PEC-Veriforce)	First lien senior secured revolving loan	563	563
QAD, Inc.	First lien senior secured revolving loan	571	571
Quva Pharma, Inc.	First lien senior secured revolving loan	851	1,182
Reef Global Acquisition LLC (fka Cheese Acquisition, LLC)	First lien senior secured revolving loan	877	747
Refresh Parent Holdings, Inc.	First lien senior secured delayed draw term loan	—	106
Refresh Parent Holdings, Inc.	First lien senior secured revolving loan	—	920
Relativity ODA LLC	First lien senior secured revolving loan	1,480	1,480
Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)	First lien senior secured revolving loan	773	967
The Shade Store, LLC	First lien senior secured revolving loan	114	227
Smarsh Inc.	First lien senior secured delayed draw term loan	190	—
Smarsh Inc.	First lien senior secured revolving loan	48	—
Sonny's Enterprises LLC	First lien senior secured revolving loan	2,630	2,254
Swipe Acquisition Corporation (dba PLI)	First lien senior secured delayed draw term loan	772	1,269
Swipe Acquisition Corporation (dba PLI)	Letter of Credit	882	882
SWK Buyer, Inc. (dba Stonewall Kitchen)	First lien senior secured delayed draw term loan	175	—
SWK Buyer, Inc. (dba Stonewall Kitchen)	First lien senior secured revolving loan	63	—

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued


Portfolio Company	Investment	March 31, 2022		December 31, 2021
Tahoe Finco, LLC	First lien senior secured revolving loan		1,744		1,744
Tamarack Intermediate, L.L.C.	First lien senior secured revolving loan		112		—
TC Holdings, LLC (dba TrialCard)	First lien senior secured revolving loan		3,315		3,315
TEMPO BUYER CORP. (dba Global Claims Services)	First lien senior secured delayed draw term loan		198		198
TEMPO BUYER CORP. (dba Global Claims Services)	First lien senior secured revolving loan		95		99
THG Acquisition, LLC (dba Hilb)	First lien senior secured revolving loan		1,871		1,871
Thunder Purchaser, Inc. (dba Vector Solutions)	First lien senior secured delayed draw term loan		2,349		2,348
Thunder Purchaser, Inc. (dba Vector Solutions)	First lien senior secured revolving loan		681		822
Troon Golf, L.L.C.	First lien senior secured revolving loan		3,806		4,685
Ultimate Baked Goods Midco, LLC	First lien senior secured revolving loan		750		950
USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)	First lien senior secured revolving loan		180		180
Valence Surface Technologies LLC	First lien senior secured revolving loan		12		12
Velocity HoldCo III Inc. (dba VelocityEHS)	First lien senior secured revolving loan		368		368
When I Work, Inc.	First lien senior secured revolving loan		143		143
WU Holdco, Inc. (dba Weiman Products, LLC)	First lien senior secured delayed draw term loan		—		1,023
WU Holdco, Inc. (dba Weiman Products, LLC)	First lien senior secured revolving loan		3,169		2,465
Total Unfunded Portfolio Company Commitments		$	148,808	$	157,293

As of March 31, 2022, the Company believed they had adequate financial resources to satisfy the unfunded portfolio company commitments.

Organizational and Offering Costs

The Adviser has incurred organization and offering costs on behalf of the Company in the amount of $12.4 million for the period from October 15, 2015 (Inception) to March 31, 2022, of which $12.4 million has been charged to the Company pursuant to the Investment Advisory Agreement. The Adviser did not incur any organization or offering costs on behalf of the Company for the three months ended March 31, 2022. Under the Investment Advisory Agreement and Administration Agreement, the Adviser is entitled to receive up to 1.5% of gross offering proceeds raised in the Company’s continuous public offering until all organization and offering costs paid by the Adviser have been recovered.

The Adviser has incurred organization and offering costs on behalf of the Company in the amount of $12.4 million for the period from October 15, 2015 (Inception) to December 31, 2021, of which $12.4 million has been charged to the Company pursuant to the Investment Advisory Agreement.

Other Commitments and Contingencies

From time to time, the Company may become a party to certain legal proceedings incidental to the normal course of its business. As of March 31, 2022, management was not aware of any material pending or threatened litigation that would require accounting recognition or financial statement disclosure.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 8. Net Assets

Share Issuances

In connection with its formation, the Company had the authority to issue 300,000,000 common shares at $0.01 per share par value. Effective as of June 18, 2019, the Company amended its charter to increase the number of shares of common stock it is authorized to issue from 300,000,000 to 450,000,000. Pursuant to the Company’s Registration Statement on Form N-2 (File No. 333-213716), the Company registered 264,000,000 common shares, par value of $0.01 per share, at an initial public offering price of $9.47 per share and pursuant to the Company’s Registration Statement of Form N-2 (File No. 333-232183), the Company registered an additional 160,000,000 common shares, par value $0.01 per share, at an initial public offering price of $9.56 per share.

On September 30, 2016, the Company issued 100 common shares for $900 to the Adviser. The Company received $900 in cash from the Adviser on November 17, 2016.

On April 4, 2017, the Company received subscription agreements totaling $10 million for the purchase of shares of its common stock from a private placement from certain individuals and entities affiliated with the Adviser. Pursuant to the terms of those subscription agreements, the individuals and entities affiliated with the Adviser agreed to pay for such shares of common stock upon demand by one of the Company’s executive officers. On April 4, 2017, the Company sold 277,778 shares pursuant to such subscription agreements and met the minimum offering requirement for the Company’s continuous public offering of $2.5 million. The purchase price of these shares sold in the private placement was $9.00 per share, which represented the initial public offering price of $9.47 per share, net of selling commissions and dealer manager fees.

The following table summarizes transactions with respect to shares of the Company’s common stock during the three months ended March 31, 2022 and 2021:


	March 31, 2022						March 31, 2021
($ in thousands, except share amounts)	Shares			Amount			Shares		Amount
Shares/gross proceeds from the continuous public offering		—		$	—			6,145,519	$	55,822
Reinvestment of distributions		1,171,526			10,481			1,141,994		10,186
Repurchased Shares		(1,730,010	)		(15,362	)		—		—
Total shares/gross proceeds		(558,484	)		(4,881	)		7,287,513		66,008
Sales load		—			—			—		(1,095	)
Total shares/net proceeds		(558,484	)	$	(4,881	)		7,287,513	$	64,913

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Prior to the termination of the Company’s continuous public offering, in the event of a material decline in its net asset value per share, which the Company considers to be a 2.5% decrease below its current net offering price, the Company’s Board reduced the offering price in order to establish a new net offering price per share that was not more than 2.5% above the net asset value. The Company will not sell shares at a net offering price below the net asset value per share unless the Company obtains the requisite approval from its shareholders. The changes to the Company’s offering price per share since the commencement of the Company’s initial continuous public offering and associated approval and effective dates of such changes were as follows:


Approval Date	Effective Date	Gross Offering Price Per Share		Net Offering Price Per Share
Initial Offering Price	April 4, 2017	$	9.47	$	9.00
May 2, 2017	May 3, 2017	$	9.52	$	9.04
January 17, 2018	January 17, 2018	$	9.53	$	9.05
January 31, 2018	January 31, 2018	$	9.55	$	9.07
July 18, 2018	July 18, 2018	$	9.56	$	9.08
October 9, 2018	October 10, 2018	$	9.57	$	9.09
January 22, 2019	January 23, 2019	$	9.46	$	8.99
February 19, 2019	February 20, 2019	$	9.51	$	9.03
February 27, 2019	February 27, 2019	$	9.52	$	9.04
April 3, 2019	April 3, 2019	$	9.54	$	9.06
April 9, 2019	April 10, 2019	$	9.55	$	9.07
July 3, 2019	July 3, 2019	$	9.56	$	9.08
October 9, 2019	October 9, 2019	$	9.49	$	9.02
January 15, 2020	January 15, 2020	$	9.51	$	9.03
March 10, 2020	March 11, 2020	$	9.41	$	8.94
March 18, 2020	March 18, 2020	$	8.83	$	8.39
March 25, 2020	March 25, 2020	$	8.74	$	8.30
April 15, 2020	April 15, 2020	$	8.80	$	8.36
April 22, 2020	April 22, 2020	$	8.85	$	8.41
May 19, 2020	May 20, 2020	$	8.87	$	8.43
May 27, 2020	May 27, 2020	$	8.93	$	8.48
June 2, 2020	June 3, 2020	$	8.96	$	8.51
June 9, 2020	June 10, 2020	$	9.02	$	8.57
June 16, 2020	June 17, 2020	$	9.05	$	8.60
July 14, 2020	July 15, 2020	$	9.08	$	8.63
July 22, 2020	July 22, 2020	$	9.12	$	8.66
July 29, 2020	July 29, 2020	$	9.14	$	8.68
August 19, 2020	August 19, 2020	$	9.16	$	8.70
August 26, 2020	August 26, 2020	$	9.18	$	8.72
September 9, 2020	September 9, 2020	$	9.21	$	8.75
September 23, 2020	September 23, 2020	$	9.24	$	8.78
December 23, 2020	December 23, 2020	$	9.32	$	8.85
January 6, 2021	January 6, 2021	$	9.37	$	8.90
March 23, 2021	March 24, 2021	$	9.42	$	8.95

The Company determined not to file additional post-effective amendments to its registration statement and terminated its offering as of April 30, 2021.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Subsequent to April 30, 2021, the Company calculated the price per share that shares issued pursuant to the dividend reinvestment plan were issued as follows:


Date of Issuance	Record Date	Number of Shares		Purchase Price per Share
May 26, 2021	May 25, 2021		364,726	$	8.93
June 30, 2021	June 29, 2021		450,718	$	8.99
July 28, 2021	July 27, 2021		392,202	$	8.95
August 25, 2021	August 24, 2021		389,897	$	8.95
September 29, 2021	September 28, 2021		384,273	$	9.00
October 27, 2021	October 26, 2021		387,954	$	8.96
November 24, 2021	November 23, 2021		389,853	$	8.95
December 29, 2021	December 28, 2021		387,939	$	9.00
January 26, 2022	January 25, 2022		389,571	$	8.98
February 23, 2022	February 22, 2022		390,759	$	8.98
March 30, 2022	March 29, 2022		391,196	$	8.88

Distributions

The Board has authorized and declared weekly distribution amounts per share of common stock through June 30, 2021 and monthly distribution amounts per share of common stock thereafter, payable monthly in arrears. The following table presents cash distributions per share that were declared during the three months ended March 31, 2022:


	Distributions
($ in thousands)	Per Share		Amount
2022
March 31, 2022 (three record dates)	$	0.15	$	22,847
Total	$	0.15	$	22,847

The following table presents cash distributions per share that were declared during the three months ended March 31, 2021:


	Distributions
($ in thousands)	Per Share		Amount
2021
March 31, 2021 (thirteen record dates)	$	0.15	$	22,434
Total	$	0.15	$	22,434

On February 23, 2021, the Board declared regular weekly distributions for April 2021 through June 2021. The regular weekly cash distributions, each in the gross amount of $0.011580 per share, will be payable monthly to shareholders of record as of the weekly record date.

On May 5, 2021, the Board declared regular monthly distributions for July 2021 through September 2021. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

On January 25, 2022, the Board declared regular monthly distributions for January 2022 through March 2022. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

On February 23, 2022, the Board declared regular monthly distributions for April 2022 through June 2022. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

On March 30, 2022, the Board declared a regular quarterly distribution payable on or before April 28, 2022 to shareholders of record as of March 31, 2022, equal to 100% of the Company's investment company taxable income and net capital gains for the taxable quarter, to the extent such amount exceeds $0.15054 per share, but is less than or equal to $0.167271 per share, which, for the quarter ended March 31, 2022, was equal to $0.15054.

With respect to distributions, the Company has adopted an “opt-in” dividend reinvestment plan for common shareholders pursuant to which shareholders that have "opted-in" may have the full amount of any cash distribution reinvested in additional shares of the Company's common stock based on the net offering price per share calculated as if the Company's offering had not been terminated. As a result, in the event of a declared distribution, each shareholder that has not “opted-in” to the dividend reinvestment plan will have their dividends or distributions automatically received in cash rather than reinvested in additional shares of the Company’s common stock. Shareholders who receive distributions in the form of shares of common stock will be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions.

The Company may fund its cash distributions to shareholders from any source of funds available to the Company, including but not limited to offering proceeds, net investment income from operations, capital gains proceeds from the sale of assets, dividends or other distributions paid to it on account of preferred and common equity investments in portfolio companies and expense support from the Adviser, which is subject to recoupment. In no event, however, will funds be advanced or borrowed for the purpose of distributions, if the amount of such distributions would exceed the Company’s accrued and received revenues for the previous four quarters, less paid and accrued operating expenses with respect to such revenues and costs.

Through March 31, 2022, a portion of the Company’s distributions resulted from expense support from the Adviser, and future distributions may result from expense support from the Adviser, each of which is subject to repayment by the Company within three years from the date of payment. The purpose of this arrangement is to avoid distributions being characterized as a return of capital for U.S. federal income tax purposes. Shareholders should understand that any such distribution is not based on the Company’s investment performance, and can only be sustained if the Company achieves positive investment performance in future periods and/or the Adviser continues to provide expense support. Shareholders should also understand that the Company’s future repayments of expense support will reduce the distributions that they would otherwise receive. There can be no assurance that the Company will achieve the performance necessary to sustain these distributions, or be able to pay distributions at all.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Sources of distributions, other than net investment income and realized gains on a U.S. GAAP basis, include required adjustments to U.S. GAAP net investment income in the current period to determine taxable income available for distributions. The following tables reflect the sources of cash distributions on a U.S. GAAP basis that the Company has declared on its shares of common stock during the three months ended March 31, 2022 and 2021:


	Three Months Ended March 31, 2022
Source of Distribution	Per Share			Amount			Percentage
($ in thousands, except per share amounts)
Net investment income	$	0.16		$	22,984			100.6		%
Net realized gain on investments(1)		—			740			3.2
Distributions in excess of (undistributed) net investment income and realized gains		(0.01	)		(877	)		(3.8	)
Total	$	0.15		$	22,847			100.0		%

________________

(1)

The per share amount rounds to less than $0.01 per share.


	Three Months Ended March 31, 2021
Source of Distribution	Per Share		Amount		Percentage
($ in thousands, except per share amounts)
Net investment income	$	0.14	$	21,062		93.9	%
Net realized gain (loss) on investments(1)		—		367		1.6
Distributions in excess of net investment income		0.01		1,005		4.5
Total	$	0.15	$	22,434		100.0	%

________________

(1)

The per share amount rounds to less than $0.01 per share.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Share Repurchases

In the third quarter of 2017, the Company began offering, and on a quarterly basis, intend to continue offering, to repurchase shares of the Company’s common stock on such terms as may be determined by the Board in its complete discretion. The Board has complete discretion to determine whether we will engage in any share repurchase, and if so, the terms of such repurchase. At the discretion of the Board, the Company may use cash on hand, cash available from borrowings, and cash from the sale of investments as of the end of the applicable period to repurchase shares.

All shares purchased by the Company pursuant to the terms of each offer to repurchase will be retired and thereafter will be authorized and unissued shares.

Any periodic repurchase offers are subject in part to the Company’s available cash and compliance with the BDC and RIC qualification and diversification rules promulgated under the 1940 Act and the Code, respectively. While the Company intends to continue to conduct quarterly tender offers as described above, the Company is not required to do so and may suspend or terminate the share repurchase program at any time.


Offer Date	Tender Offer Expiration	Tender Offer		Purchase Price per Share		Shares Repurchased
March 4, 2019	March 29, 2019	$	6,207,452	$	9.06		119,874
May 13, 2019	June 10, 2019	$	9,039,928	$	9.07		100,108
August 19, 2019	September 16, 2019	$	13,085,063	$	9.08		234,693
November 18, 2019	December 16, 2019	$	16,984,077	$	9.02		396,914
March 9, 2020	April 3, 2020	$	21,398,616	$	8.30		1,462,441
May 26, 2020	June 22, 2020	$	16,280,933	$	8.60		600,204
August 24, 2020	September 21, 2020	$	21,493,631	$	8.78		1,797,979
November 16, 2020	December 14, 2020	$	16,153,577	$	8.78		794,091
March 10, 2021	April 6, 2021	$	18,995,153	$	8.95		1,945,553
June 1, 2021	June 28, 2021	$	19,621,539	$	8.99		2,182,596
August 30, 2021	September 27, 2021	$	11,911,588	$	9.00		1,323,510
November 29, 2021	December 27, 2021	$	11,859,682	$	9.00		1,317,742
March 1, 2022	March 28, 2022	$	15,362,486	$	8.88		1,730,010

Note 9. Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per common share for the three months ended March 31, 2022 and 2021:


	Three Months Ended March 31,
($ in thousands, except per share amounts)	2022		2021
Increase (decrease) in net assets resulting from operations	$	10,005	$	32,263
Weighted average shares of common stock outstanding—basic and diluted		151,788,770		149,144,175
Earnings per common share-basic and diluted	$	0.07	$	0.22

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 10. Income Taxes

The Company has elected to be treated as a RIC under Subchapter M of the Code, and intends to operate in a manner so as to continue to qualify for the tax treatment applicable to RICs. To qualify for tax treatment as a RIC, the Company must, among other things, distribute to its shareholders in each taxable year generally at least 90% of the Company’s investment company taxable income, as defined by the Code, and net tax-exempt income for that taxable year. To maintain tax treatment as a RIC, the Company, among other things, intends to make the requisite distributions to its shareholders, which generally relieves the Company from corporate-level U.S. federal income taxes.

Depending on the level of taxable income earned in a tax year, the Company can be expected to carry forward taxable income (including net capital gains, if any) in excess of current year dividend distributions from the current tax year into the next tax year and pay a nondeductible 4% U.S. federal excise tax on such taxable income, as required. To the extent that the Company determines that its estimated current year annual taxable income will be in excess of estimated current year dividend distributions from such income, the Company will accrue excise tax on estimated excess taxable income.

For the three months ended March 31, 2022, the Company recorded U.S. federal income tax expense/(benefit) of $0.3 million. For the three months ended March 31, 2021 the Company recorded U.S. federal income tax expense/(benefit) of $0.3 million.

Taxable Subsidiaries

Certain of the Company’s consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes. For the three months ended March 31, 2022, the Company recorded net tax expenses of approximately $0.3 million for taxable subsidiaries. For the three months ended March 31, 2021, the Company recorded net tax expenses of approximately $0.3 million for taxable subsidiaries.

The Company recorded net deferred tax liabilities of $4.1 million and $4.0 million as of March 31, 2022 and December 31, 2021, respectively, for taxable subsidiaries, which is significantly related to GAAP to tax outside basis differences in the taxable subsidiaries' investment in certain partnership interests.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 11. Financial Highlights

The following are the financial highlights for a common share outstanding during the three months ended March 31, 2022 and 2021:


	For the Three Months Ended March 31,
($ in thousands, except share and per share amounts)	2022				2021
Per share data:
Net asset value, at beginning of period	$	8.98			$	8.84
Results of operations:
Net investment income(1)		0.16				0.14
Net realized and unrealized gain (loss)(5)		(0.09	)			0.08
Net increase (decrease) in net assets resulting from operations		0.07				0.22
Shareholder distributions:
Distributions from net investment income(2)		(0.16	)			(0.14	)
Distributions from net realized gains(2)(8)		—				—
Undistributed (distributions in excess of) net investment income and net realized gains(2)		0.01				(0.01	)
Net increase (decrease) in net assets from shareholders' distributions		(0.15	)			(0.15	)
Capital share transactions:
Issuance of common stock above net asset value		—				—		(8)
Net increase in net assets resulting from capital share transactions		—				—		(8)
Net asset value, at end of period	$	8.90			$	8.91

Total Return(3)(6)		0.6		%		1.8		%

Ratios
Ratio of net expenses to average net assets(4)(7)		7.5		%		6.6		%
Ratio of net investment income to average net assets(7)		6.8		%		6.4		%
Portfolio turnover rate		2.7		%		5.5		%

Supplemental Data
Weighted-average shares outstanding		151,788,770				149,144,175
Shares outstanding, end of period		150,818,035				152,735,740
Net assets, end of period	$	1,341,968			$	1,361,046

________________

(1)

The per share data was derived using the weighted average shares during the period.

(2)

The per share data was derived using actual shares outstanding at the date of the relevant transaction.

(3)

Total return is not annualized. An investment in the Company is subject to a maximum upfront sales load of 5% of the offering price, which will reduce the amount of capital available for investment. Total return displayed is net of all fees, including all operating expenses such as management fees, incentive fees, general and administrative expenses, organization and amortized offering expenses, and interest expenses.

(4)

Operating expenses may vary in the future based on the amount of capital raised, the Adviser’s election to continue expense support, and other unpredictable variables. For the three months ended March 31, 2022 and 2021, the total operating expenses to average net assets were 7.5% and 7.0%, respectively, prior to expense support provided by the Adviser, expense recoupment paid to the Adviser, and management and incentive fee waivers, if any. Past performance is not a guarantee of future results.

(5)

The amount shown at this caption is the balancing amount derived from the other figures in the schedule. The amount shown at this caption for a share outstanding throughout the year may not agree with the change in the aggregate gains and losses in portfolio securities for the year because of the timing of sales of the Company’s shares in relation to fluctuating market values for the portfolio.

(6)

Total return is calculated as the change in net asset value (“NAV”) per share (assuming dividends and distributions, if any, are reinvested in accordance with the Company’s dividend reinvestment plan), if any, divided by the beginning NAV per share (which for the purposes of this calculation is equal to the net offering price in effect at that time).

(7)

The ratio reflects an annualized amount, except in the case of non-recurring expenses (e.g. initial organization expenses).

(8)

The per share amount rounds to less than $0.01 per share.

Owl Rock Capital Corporation II

Notes to Consolidated Financial Statements (Unaudited) – Continued

Note 12. Subsequent Events

On April 27, 2022, the Company determined that shares issued pursuant to the Company's distribution reinvestment plan will be issued at price of $8.88 per share.

On May 3, 2022, the Board declared regular monthly distributions for July 2022 through September 2022. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

On May 3, 2022, the Board declared a regular quarterly distribution payable on or before August 15, 2022 to shareholders of record as of June 30, 2022, equal to 100% of the Company's investment company taxable income and net capital gains for the taxable quarter, to the extent such amount exceeds $0.15054 per share, but is less than or equal to $0.167271 per share.

On May 6, 2022, the parties to the SPV Asset Facility I amended the SPV Asset Facility I to, among other things, convert the benchmark rate of the facility loans denominated in USD from LIBOR to term SOFR, extend the reinvestment period from November 30, 2022 to November 30, 2023, extend the stated maturity from November 30, 2023 to November 30, 2024, and increase the spread from 2.25% to 2.40%.

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

The information contained in this section should be read in conjunction with “ITEM 1. CONSOLIDATED FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA”. This discussion contains forward-looking statements, which relate to future events or the future performance or financial condition of Owl Rock Capital Corporation II and involves numerous risks and uncertainties, including, but not limited to, those described in our Form 10-K for the fiscal year ended December 31, 2021 and in “ITEM 1A. RISK FACTORS”. This discussion also should be read in conjunction with the “Cautionary Statement Regarding Forward Looking Statements” set forth on page 3 of this Quarterly Report on Form 10-Q. Actual results could differ materially from those implied or expressed in any forward-looking statements.

Overview

Owl Rock Capital Corporation II (the “Company”, “we”, “us”, or “our”) is an externally managed, non-diversified closed-end management investment company that has elected to be treated as a business development company (“BDC”) under the 1940 Act. Formed as a Maryland corporation on October 15, 2015, we are externally managed by Owl Rock Capital Advisors LLC (the “Adviser”) which is responsible for sourcing potential investments, conducting due diligence on prospective investments, analyzing investment opportunities, structuring investments and monitoring our portfolio on an ongoing basis. The Adviser is registered as an investment adviser with the Securities and Exchange Commission (“SEC”). We have elected to be treated as a RIC under Subchapter M of the Code, and we intend to operate in a manner so as to continue to qualify for the tax treatment applicable to RICs. On February 28, 2017, we formed a wholly-owned subsidiary, OR Lending II LLC, a Delaware limited liability company, which holds a California finance lenders license. OR Lending II LLC originates loans to borrowers headquartered in California.

We are managed by our Adviser. Our Adviser is registered with the SEC as an investment adviser under the Investment Advisers Act of 1940, as amended (the "Advisers Act"), an indirect subsidiary of Blue Owl Capital, Inc. ("Blue Owl") (NYSE: OWL) and part of Owl Rock, a division of Blue Owl focused on direct lending. Subject to the overall supervision of our Board, our Adviser manages the day-to-day operations of, and provides investment advisory and management services, to us. The Adviser or its affiliates may engage in certain organizational activities and receive attendant arrangement, structuring or similar fees. Our Adviser is responsible for managing our business and activities, including sourcing investment opportunities, conducting research, performing diligence on potential investments, structuring our investments, and monitoring our portfolio companies on an ongoing basis through a team of management professionals.

We commenced a continuous public offering for up to 264,000,000 shares of our common stock on April 4, 2017. On January 29, 2020, we commenced the follow-on offering for up to 160,000,000 shares of our common stock. On September 30, 2016, the Adviser purchased 100 shares of our common stock at $9.00 per share, which represented the initial public offering price of $9.47 per share, net of combined upfront selling commissions and dealer manager fees. The Adviser will not tender these shares for repurchase as long as the Adviser remains our investment adviser. There is no current intention for the Adviser to discontinue in its role. On April 4, 2017, we received subscription agreements totaling $10.0 million for the purchase of shares of our common stock from a private placement from certain individuals and entities affiliated with the Adviser. Pursuant to the terms of those subscription agreements, the individuals and entities affiliated with the Adviser agreed to pay for such shares of common stock upon demand by one of our executive officers. On April 4, 2017, we sold 277,778 shares pursuant to such subscription agreements and met the minimum offering requirement for our continuous public offering of $2.5 million. The purchase price of these shares sold in the private placement was $9.00 per share, which represented the initial public offering price of $9.47 per share, net of selling commissions and dealer manager fees. In April 2017, we commenced operations and made our first portfolio company investment. Since meeting the minimum offering requirement and commencing our continuous public offering and through the termination of our offering, we have issued 151,364,239 shares of our common stock for gross proceeds of approximately $1.4 billion, including seed capital contributed by our Adviser in September 2016 and approximately $10.0 million in gross proceeds raised in the private placement from certain individuals and entities affiliated with Owl Rock Capital Advisors. We have determined not to file additional post-effective amendments to our registration statement and terminated our public offering as of April 30, 2021.

Our Adviser also serves as investment adviser to Owl Rock Capital Corporation and Owl Rock Core Income Corp.

Blue Owl consists of three divisions: Blue Owl consists of three divisions: (1) Owl Rock, which focuses on direct lending, (2) Dyal, which focuses on providing capital to institutional alternative asset managers and (3) Oak Street, which focuses on real estate strategies. Owl Rock is comprised of Owl Rock Technology Advisors LLC (“ORTA”), Owl Rock Capital Private Fund Advisors LLC (“ORPFA”), Owl Rock Technology Advisors II LLC ("ORTA II") and Owl Rock Diversified Advisors LLC (“ORDA” and together with ORTA, ORPFA, ORTA II and the Adviser, the "Owl Rock Advisers"), which also are investment advisers and includes Wellfleet. As of March 31, 2022, the Adviser and its affiliates had $44.8 billion of assets under management across the Owl Rock division of Blue Owl. As of April 1, 2022, the Owl Rock division of Blue Owl also includes a CLO business ("Wellfleet"), which was acquired from affiliates of Littlejohn & Co. LLC.

The management of our investment portfolio is the responsibility of the Adviser and the Investment Committee. We consider these individuals to be our portfolio managers. The Investment Team is led by Douglas I. Ostrover, Marc S. Lipschultz and Craig W. Packer and is supported by certain members of the Adviser's senior executive team and the Investment Committee. The Investment Team, including members of Wellfleet, under the Investment Committee's supervision, sources investment opportunities, conducts research, performs due diligence on potential investments, structures our investments and will monitor our portfolio companies on an ongoing basis. The Investment Committee is comprised of Douglas I. Ostrover, Marc S. Lipschultz, Craig W. Packer, Alexis Maged and Jeff Walwyn. The Investment Committee meets regularly to consider our investments, direct our strategic initiatives and supervise the actions taken by the Adviser on our behalf. In addition, the Investment Committee reviews and determines whether to make prospective investments (including approving parameters or guidelines pursuant to which investments in broadly syndicated loans may be bought and sold), structures financings and monitors the performance of the investment portfolio. Each investment opportunity requires the approval of a majority of the Investment Committee. Follow-on investments in existing portfolio companies may require the Investment Committee's approval beyond that obtained when the initial investment in the portfolio company was made. In addition, temporary investments, such as those in cash equivalents, U.S. government securities and other high quality debt investments that mature in one year or less, may require approval by the Investment Committee. The compensation packages of certain Investment Committee members from the Adviser include various combinations of discretionary bonuses and variable incentive compensation based primarily on performance for services provided and may include shares of Blue Owl.

We may be prohibited under the 1940 Act from participating in certain transactions with our affiliates without the prior approval of our directors who are not interested persons and, in some cases, the prior approval of the SEC. We, our Adviser and certain affiliates, have been granted exemptive relief by the SEC to permit us to co-invest with other funds managed by our Adviser or certain of its affiliates, in a manner consistent with our investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. Pursuant to such exemptive relief, we generally are permitted to co-invest with certain of our affiliates if a “required majority” (as defined in Section 57(o) of the Investment Company Act of 1940, as amended (the "1940 Act") of our independent directors make certain conclusions in connection with a co-investment transaction, including that (1) the terms of the transactions, including the consideration to be paid, are reasonable and fair to us and our shareholders and do not involve overreaching by us or our shareholders on the part of any person concerned, (2) the transaction is consistent with the interests of our shareholders and is consistent with our investment objective and strategies, (3) the investment by our affiliates would not disadvantage us, and our participation would not be on a basis different from or less advantageous than that on which our affiliates are investing and (4) the proposed investment by the Company would not benefit the Advisers or its affiliates or any affiliated person of any of them (other than the parties to the transaction), except to the extent permitted by the exemptive relief and applicable law, including the limitation set forth in Section 57(k) of the 1940 Act. The Owl Rock Advisors’ investment allocation policy seeks to ensure equitable allocation of investment opportunities over time between us and other funds managed by our Adviser or its affiliates. As a result of the exemptive relief, there could be significant overlap in our investment portfolio and the investment portfolio of the Owl Rock Clients and/or other funds managed by the Adviser or its affiliates that could avail themselves of exemptive relief and that have an investment objective similar to ours.

For time to time we may form wholly-owned subsidiaries to facilitate our normal course of business.

Certain of our consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

We have elected to be regulated as a BDC under the 1940 Act and as a regulated investment company (“RIC”) for tax purposes under the Internal Revenue Code of 1986, as amended (the “Code”). As a result, we are required to comply with various statutory and regulatory requirements, such as:

•

the requirement to invest at least 70% of our assets in “qualifying assets”, as such term is defined in the 1940 Act;

•

source of income limitations;

•

asset diversification requirements; and

•

the requirement to distribute (or be treated as distributing) in each taxable year at least 90% of our investment company taxable income and tax-exempt interest for that taxable year.

COVID-19 Developments

In March 2020, the outbreak of COVID-19 was recognized as a pandemic by the World Health Organization. In response to the outbreak, our Adviser instituted a work from home policy and began monitoring the ability of its employees to safely return to the office. In October 2021, the Adviser implemented a return to in-office work policy across all of its offices. This policy encourages a return to in-office work but allows for flexibility to work from home based on current conditions.

We have and continue to assess the impact of COVID-19 on our portfolio companies. We cannot predict the full impact of the COVID-19 pandemic, including its duration in the United States and worldwide, the effectiveness of governmental responses designed to mitigate strain to businesses and the economy and the magnitude of the economic impact of the outbreak. The COVID-19 pandemic and preventative measures taken to contain or mitigate its spread have caused, and may in the future cause, business shutdowns, cancellations of events and travel. In addition, while economic activity remains healthy and well improved from the beginning of the COVID-19 pandemic, we continue to observe supply chain interruptions, labor difficulties, commodity inflation and elements of geopolitical, economic and financial market instability both globally and in the United States.

We have built out our portfolio management team to include workout experts and continue to closely monitor our portfolio companies; however, we are unable to predict the duration of any business and supply-chain disruptions or labor difficulties, the extent to which COVID-19 will negatively affect our portfolio companies’ operating results or the impact that such disruptions may have on our results of operations and financial condition.

Our Investment Framework

We are a Maryland corporation organized primarily to originate and make loans to, and make debt and equity investments in, U.S. middle market companies. Our investment objective is to generate current income, and to a lesser extent, capital appreciation by targeting investment opportunities with favorable risk-adjusted returns. Since our Adviser and its affiliates began investment activities in April 2016 through March 31, 2022, our Adviser and its affiliates have originated $56.0 billion aggregate principal amount of investments, of which $53.0 billion aggregate principal amount of investments prior to any subsequent exits or repayments, was retained by either us or a corporation or fund advised by our Adviser or its affiliates. We seek to generate current income primarily in U.S. middle market companies through direct originations of senior secured loans or originations of unsecured loans, subordinated loans or mezzanine loans, broadly syndicated loans and, to a lesser extent, investments in equity and equity-related securities including warrants, preferred stock and similar forms of senior equity. Our equity investments are typically not control-oriented investments and we may structure such equity investments to include provisions protecting our rights as a minority-interest holder.

We define “middle market companies” generally to mean companies with earnings before interest expense, income tax expense, depreciation and amortization, or “EBITDA,” between $10 million and $250 million annually and/or annual revenue of $50 million to $2.5 billion at the time of investment, although we may on occasion invest in smaller or larger companies if an opportunity presents itself. We generally seek to invest in companies with a loan-to-value ratio of 50% or below.

We expect that generally our portfolio composition will be majority debt or income producing securities, which may include “covenant-lite” loans (as defined below), with a lesser allocation to equity or equity-linked opportunities, including publicly traded debt instruments, which we may hold directly or through special purposes vehicles. In addition, we may invest a portion of our portfolio in opportunistic investments and broadly syndicated loans, which will not be our primary focus, but will be intended to enhance returns to our shareholders and from time to time, we may evaluate and enter into strategic portfolio transactions which may result in additional portfolio companies which we are considered to control. These investments may include high-yield bonds and broadly-syndicated loans, including publicly traded debt instruments, which are typically originated and structured by banks on behalf of large corporate borrowers with employee counts, revenues, EBITDAs and enterprise values larger than the middle-market characteristics described above. In addition, we generally do not intend to invest more than 20% of our total assets in companies whose principal place of business is outside the United States, although we do not generally intend to invest in companies whose principal place of business is in an emerging market. Our portfolio composition may fluctuate from time to time based on market conditions and interest rates; however, we seek to invest not more than 20% of our portfolio in any single industry classification and target portfolio companies that comprise 1-2% of our portfolio (with no individual portfolio company generally expected to comprise greater than 5% of our portfolio).

Covenants are contractual restrictions that lenders place on companies to limit the corporate actions a company may pursue. Generally, the loans in which we expect to invest will have financial maintenance covenants, which are used to proactively address materially adverse changes in a portfolio company’s financial performance. However, to a lesser extent, we may invest in “covenant-lite” loans. We use the term “covenant-lite” to refer generally to loans that do not have a complete set of financial maintenance covenants. Generally, “covenant-lite” loans provide borrower companies more freedom to negatively impact lenders because their covenants are incurrence-based, which means they are only tested and can only be breached following an affirmative action of the borrower, rather than by a deterioration in the borrower’s financial condition. Accordingly, to the extent we invest in “covenant-lite” loans, we may have fewer rights against a borrower and may have a greater risk of loss on such investments as compared to investments in or exposure to loans with financial maintenance covenants.

We target portfolio companies where we can structure larger transactions. As of March 31, 2022, our average investment size in each of our portfolio companies was approximately $16.2 million based on fair value. As of March 31, 2022, excluding certain investments that fall outside our typical borrower profile, our portfolio companies representing 86.1% of our total debt portfolio based on fair value, had weighted average annual revenue of $658 million, weighted average annual EBITDA of $147 million and an average interest coverage of 2.8x.

The companies in which we invest use our capital to support their growth, acquisitions, market or product expansion, refinancings and/or recapitalizations. The debt in which we invest typically is not rated by any rating agency, but if these instruments were rated, they would likely receive a rating of below investment grade (that is, below BBB- or Baa3), which is often referred to as “high yield” or “junk”.

A majority of our new investments are indexed to SOFR; however we have material contracts that are indexed to USD-LIBOR and are monitoring this activity, evaluating the related risks and our exposure, and adding alternative language to contracts, where necessary. Certain contracts have an orderly market transition already in process. However, it is not possible to predict the effect of any of these developments, and any future initiatives to regulate, reform or change the manner of administration of LIBOR could result in adverse consequences to the rate of interest payable and receivable on, market value of and market liquidity for LIBOR-based financial instruments.

Key Components of Our Results of Operations

Investments

We focus primarily on the direct origination of loans to middle market companies domiciled in the United States.

Our level of investment activity (both the number of investments and the size of each investment) can and will vary substantially from period to period depending on many factors, including the amount of debt and equity capital available to middle market companies, the level of merger and acquisition activity for such companies, the general economic environment and the competitive environment for the types of investments we make.

In addition, as part of our risk strategy on investments, we may reduce the levels of certain investments through partial sales or syndication to additional lenders.

Revenues

We generate revenues primarily in the form of interest income from the investments we hold. In addition, we may generate income from dividends on either direct equity investments or equity interests obtained in connection with originating loans, such as options, warrants or conversion rights. Our debt investments typically have a term of three to ten years. As of March 31, 2022, 99.0% of our debt investments based on fair value bear interest at a floating rate, subject to interest rate floors in certain cases. Interest on our debt investments is generally payable either monthly or quarterly.

Our investment portfolio consists primarily of floating rate loans, and our credit facilities bear interest at floating rates. Macro trends in base interest rates like London Interbank Offered Rate (“LIBOR”), the Secured Overnight Financing Rate ("SOFR") and any alternative reference rates may affect our net investment income over the long term. However, because we generally originate loans to a small number of portfolio companies each quarter, and those investments vary in size, our results in any given period, including the interest rate on investments that were sold or repaid in a period compared to the interest rate of new investments made during that period, often are idiosyncratic, and reflect the characteristics of the particular portfolio companies that we invested in or exited during the period and not necessarily any trends in our business or macro trends.

Loan origination fees, original issue discount and market discount or premium are capitalized, and we accrete or amortize such amounts under generally accepted accounting principles (“U.S. GAAP”) as interest income using the effective yield method for term instruments and the straight-line method for revolving or delayed draw instruments. Repayments of our debt investments can reduce interest income from period to period. The frequency or volume of these repayments may fluctuate significantly. We record prepayment premiums on loans as interest income. We may also generate revenue in the form of commitment, loan origination, structuring, or due diligence fees, fees for providing managerial assistance to our portfolio companies and possibly consulting fees.

Dividend income on equity investments is recorded on the record date for private portfolio companies or on the ex-dividend date for publicly traded companies.

Our portfolio activity also reflects the proceeds from sales of investments. 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 without regard to unrealized gains or losses previously recognized. We record current period changes in fair value of investments that are measured at fair value as a component of the net change in unrealized gains (losses) on investments in the Consolidated Statements of Operations.

Expenses

Our primary operating expenses include the payment of the management fee, performance based incentive fee, expenses reimbursable under the Administration Agreement and Investment Advisory Agreement, legal and professional fees, interest and other debt expenses and other operating expenses. The management fee and performance based incentive fee compensate our Adviser for work in identifying, evaluating, negotiating, closing, monitoring and realizing our investments.

Except as specifically provided below, all investment professionals and staff of the Adviser, when and to the extent engaged in providing investment advisory and management services to us, and the base compensation, bonus and benefits, and the routine overhead expenses, of such personnel allocable to such services, are provided and paid for by the Adviser. We bear our allocable portion of the compensation paid by the Adviser (or its affiliates) to our Chief Compliance Officer and Chief Financial Officer and their respective staffs (based on a percentage of time such individuals devote, on an estimated basis, to our business affairs). We bear all other costs and expenses of our operations, administration and transactions, including, but not limited to (i) investment advisory fees, including management fees and incentive fees, to the Adviser, pursuant to the Investment Advisory Agreement; (ii) our allocable portion of overhead and other expenses incurred by the Adviser in performing its administrative obligations under the Administration Agreement; and (iii) all other expenses of our operations and transactions including, without limitation, those relating to:

•

expenses deemed to be “organization and offering expenses” for purposes of Conduct Rule 2310(a)(12) of Financial Industry Regulatory Authority (exclusive of commissions, the dealer manager fee, any discounts and other similar expenses paid by investors at the time of sale of our stock);

•

the cost of corporate and organizational expenses relating to offerings of shares of our common stock;

•

the cost of calculating our net asset value, including the cost of any third-party valuation services;

•

the cost of effecting any sales and repurchases of our common stock and other securities;

•

fees and expenses payable under any dealer manager agreements, if any;

•

debt service and other costs of borrowings or other financing arrangements;

•

costs of hedging;

•

expenses, including travel expense, incurred by the Adviser, or members of the investment team, or payable to third parties, performing due diligence on prospective portfolio companies and, if necessary, enforcing our rights;

•

escrow agent, transfer agent and custodial fees and expenses;

•

fees and expenses associated with marketing efforts;

•

federal and state registration fees, any stock exchange listing fees and fees payable to rating agencies;

•

federal, state and local taxes;

•

independent directors’ fees and expenses, including certain travel expenses;

•

costs of preparing financial statements and maintaining books and records and filing reports or other documents with the SEC (or other regulatory bodies) and other reporting and compliance costs, including registration fees, listing fees and licenses, and the compensation of professionals responsible for the preparation of the foregoing;

•

the costs of any reports, proxy statements or other notices to our shareholders (including printing and mailing costs);

•

the costs of any shareholder or director meetings and the compensation of personnel responsible for the preparation of the foregoing and related matters;

•

commissions and other compensation payable to brokers or dealers;

•

research and market data;

•

fidelity bond, directors’ and officers’ errors and omissions liability insurance and other insurance premiums;

•

direct costs and expenses of administration, including printing, mailing, long distance telephone and staff;

•

fees and expenses associated with independent audits, outside legal and consulting costs;

•

costs of winding up;

•

costs incurred in connection with the formation or maintenance of entities or vehicles to hold our assets for tax or other purposes;

•

extraordinary expenses (such as litigation or indemnification); and

•

costs associated with reporting and compliance obligations under the 1940 Act and applicable federal and state securities laws.

We expect, but cannot assure, that our general and administrative expenses will increase in dollar terms during periods of asset growth, but will decline as a percentage of total assets during such periods.

Expense Support and Conditional Reimbursement Agreement

We have entered into an Expense Support and Conditional Reimbursement Agreement (the “Expense Support Agreement”) with the Adviser, the purpose of which is to ensure that no portion of our distributions to shareholders will represent a return of capital for U.S. federal income tax purposes. The Expense Support Agreement became effective as of April 4, 2017, the date that the Company met the minimum offering requirement.

On a quarterly basis, the Adviser shall reimburse us for “Operating Expenses” (as defined below) in an amount equal to the excess of our cumulative distributions paid to our shareholders in each quarter over “Available Operating Funds” (as defined below) received by us on account of our investment portfolio during such quarter. Any payments required to be made by the Adviser pursuant to the preceding sentence are referred to herein as an “Expense Payment”.

Pursuant to the Expense Support Agreement, “Operating Expenses” means all of our operating costs and expenses incurred, as determined in accordance with generally accepted accounting principles for investment companies. “Available Operating Funds” means the sum of (i) our estimated investment company taxable income (including realized net short-term capital gains reduced by realized net long-term capital losses), (ii) our realized net capital gains (including the excess of realized net long-term capital gains over realized net short-term capital losses) and (iii) dividends and other distributions paid to us on account of preferred and common equity investments in portfolio companies, if any (to the extent such amounts listed in clause (iii) are not included under clauses (i) and (ii) above).

The Adviser’s obligation to make an Expense Payment shall automatically become a liability of the Adviser and the right to such Expense Payment will be an asset of ours on the last business day of the applicable quarter. The Expense Payment for any quarter will be paid by the Adviser to us in any combination of cash or other immediately available funds, and/or offset against amounts due from us to the Adviser no later than the earlier of (i) the date on which we close our books for such quarter, or (ii) forty-five days after the end of such quarter.

Following any quarter in which Available Operating Funds exceed the cumulative distributions paid by us in respect of such quarter (the amount of such excess being hereinafter referred to as “Excess Operating Funds”), we will pay such Excess Operating Funds, or a portion thereof, in accordance with the stipulations below, as applicable, to the Adviser, until such time as all Expense Payments made by the Adviser to us within three years prior to the last business day of such quarter have been reimbursed. Any payments required to be made by us are referred to as a “Reimbursement Payment”.

The amount of the Reimbursement Payment for any quarter shall equal the lesser of (i) the Excess Operating Funds in respect of such quarter and (ii) the aggregate amount of all Expense Payments made by the Adviser to us within three years prior to the last business day of such quarter that have not been previously reimbursed by us to the Adviser. The payment will be reduced to the extent that such Reimbursement Payments, together with all other Reimbursement Payments paid during the fiscal year, would cause Other Operating Expenses defined as our total Operating Expenses, excluding base management fees, incentive fees, organization and offering expenses, distribution and shareholder servicing fees, financing fees and costs, interest expense, brokerage commissions and extraordinary expenses on an annualized basis and net of any Expense Payments received by us during the fiscal year to exceed the lesser of: (i) 1.75% of our average net assets attributable to the shares of our common stock for the fiscal year-to-date period after taking such Expense Payments into account; and (ii) the percentage of our average net assets attributable to shares of our common stock represented by Other Operating Expenses during the fiscal year in which such Expense Payment was made (provided, however, that this clause (ii) shall not apply to any Reimbursement Payment which relates to an Expense Payment made during the same fiscal year).

No Reimbursement Payment for any quarter will be made if: (1) the “Effective Rate of Distributions Per Share” (as defined below) declared by us at the time of such Reimbursement Payment is less than the Effective Rate of Distributions Per Share at the time the Expense Payment was made to which such Reimbursement Payment relates, or (2) our “Operating Expense Ratio” (as defined below) at the time of such Reimbursement Payment is greater than the Operating Expense Ratio at the time the Expense Payment was made to which such Reimbursement Payment relates. Pursuant to the Expense Support Agreement, “Effective Rate of Distributions Per Share” means the annualized rate (based on a 365 day year) of regular cash distributions per share exclusive of returns of capital, distribution rate reductions due to distribution and shareholder fees, and declared special dividends or special distributions, if any. The “Operating Expense Ratio” is calculated by dividing Operating Expenses, less organizational and offering expenses, base management and incentive fees owed to Adviser, and interest expense, by our net assets.

The specific amount of expenses reimbursed by the Adviser, if any, will be determined at the end of each quarter. We or the Adviser will be able to terminate the Expense Support Agreement at any time, with or without notice. The Expense Support Agreement will automatically terminate in the event of (a) the termination of the Investment Advisory Agreement, or (b) a

determination by our Board to dissolve or liquidate the Company. Upon termination of the Expense Support Agreement, we will be required to fund any Expense Payments that have not been reimbursed by us to the Adviser. As of March 31, 2022, the amount of Expense Support payments provided by our Adviser since inception is $32.8 million.

Fee Waivers

On June 8, 2018, the Adviser agreed to waive (A) any portion of the management fee that was in excess of 1.50% of our gross assets, excluding cash and cash-equivalents but including assets purchased with borrowed amounts at the end of the two most recently completed calendar quarters, calculated in accordance with the Investment Advisory Agreement, (B) any portion of the incentive fee on net investment income that was in excess of 17.5% of our pre-incentive fee net investment income, which was calculated in accordance with the Investment Advisory Agreement but based on a quarterly preferred return of 1.50% per quarter and an upper level breakpoint of 1.818%, and (C) any portion of the incentive fee on capital gains that was in excess of 17.5% of our realized capital gains, if any, on a cumulative basis from inception through the end of such calendar year, net of all realized capital losses and unrealized capital depreciation on a cumulative basis, minus the aggregate amount of any previously paid incentive fee on capital gains as calculated in accordance with U.S. GAAP (the “Waiver”). Any portion of the management fee, incentive fee on net investment income and incentive fee on capital gains waived is not subject to recoupment.

On February 19, 2020, our Board approved the prior investment advisory agreement, which reduced the management fee and incentive fee to the amounts specified in the Waiver.

Reimbursement of Administrative Services

We will reimburse our Adviser for the administrative expenses necessary for its performance of services to us. However, such reimbursement will be made at an amount equal to the lower of our Adviser’s actual costs or the amount that we would be required to pay for comparable administrative services in the same geographic location. Also, such costs will be reasonably allocated to us on the basis of assets, revenues, time records or other reasonable methods. We will not reimburse our Adviser for any services for which it receives a separate fee, for example rent, depreciation, utilities, capital equipment or other administrative items allocated to a controlling person of our Adviser.

Leverage

The amount of leverage we use in any period depends on a variety of factors, including cash available for investing, the cost of financing and general economic and market conditions. Generally, our total borrowings are limited so that we cannot incur additional borrowings, including through the issuance of additional debt securities, if such additional indebtedness would cause our asset coverage ratio to fall below 200%, as defined in the 1940 Act; however, recent legislation has modified the 1940 Act by allowing a BDC to increase the maximum amount of leverage it may incur from an asset coverage ratio of 200% to an asset coverage ratio of 150%, if certain requirements are met. The reduced asset coverage requirement would permit a BDC to double the amount of leverage it could incur. We are permitted to increase our leverage capacity if shareholders representing at least a majority of the votes cast, when quorum is met, approve a proposal to do so. If we receive such shareholder approval, we would be permitted to increase our leverage capacity on the first day after such approval. Alternatively, we may increase the maximum amount of leverage we may incur to an asset coverage ratio of 150% if the required majority (as defined in Section 57(o) of the 1940 Act) of the independent members of our Board approves such increase with such approval becoming effective after one year. In either case, we would be required to extend to our shareholders, as of the date of such approval, the opportunity to sell the shares of common stock that they hold and we would be required to make certain disclosures on our website and in SEC filings regarding, among other things, the receipt of approval to increase our leverage, our leverage capacity and usage, and risks related to leverage. For shareholders accepting such an offer, the Company would be required to repurchase 25% of such shareholders’ eligible shares in each of the four calendar quarters following the calendar quarter in which the approval occurs. In addition, before incurring any such additional leverage, we would have to renegotiate or receive a waiver from the contractual leverage limitations under our existing credit facilities and notes. Our current target leverage ratio is 0.75x.

In any period, our interest expense will depend largely on the extent of our borrowing and we expect interest expense will increase as we increase our leverage over time subject to the limits of the 1940 Act. In addition, we may dedicate assets to financing facilities.

Market Trends

We believe the middle-market lending environment provides opportunities for us to meet our goal of making investments that generate attractive risk-adjusted returns based on a combination of the following factors.

Limited Availability of Capital for Middle-Market Companies. We believe that regulatory and structural changes in the market have reduced the amount of capital available to U.S. middle-market companies. In particular, we believe there are currently fewer providers of capital to middle market companies. We believe that many commercial and investment banks have, in recent years, de-emphasized their service and product offerings to middle-market businesses in favor of lending to large corporate clients and managing capital markets transactions. In addition, these lenders may be constrained in their ability to underwrite and hold bank loans and high yield securities for middle-market issuers as they seek to meet existing and future regulatory capital requirements. We also believe that there is a lack of market participants that are willing to hold meaningful amounts of certain middle-market loans. As a result, we believe our ability to minimize syndication risk for a company seeking financing by being able to hold its loans without having to syndicate them, coupled with reduced capacity of traditional lenders to serve the middle-market, present an attractive opportunity to invest in middle-market companies.

Capital Markets Have Been Unable to Fill the Void in U.S. Middle Market Finance Left by Banks. While underwritten bond and syndicated loan markets have been robust in recent years, middle market companies are less able to access these markets for reasons including the following:

High Yield Market – Middle market companies generally are not issuing debt in an amount large enough to be an attractively sized bond. High yield bonds are generally purchased by institutional investors who, among other things, are focused on the liquidity characteristics of the bond being issued. For example, mutual funds and exchange traded funds (“ETFs”) are significant buyers of underwritten bonds. However, mutual funds and ETFs generally require the ability to liquidate their investments quickly in order to fund investor redemptions and/or comply with regulatory requirements. Accordingly, the existence of an active secondary market for bonds is an important consideration in these entities’ initial investment decision. Because there is typically little or no active secondary market for the debt of U.S. middle market companies, mutual funds and ETFs generally do not provide debt capital to U.S. middle market companies. We believe this is likely to be a persistent problem and creates an advantage for those like us who have a more stable capital base and have the ability to invest in illiquid assets.

Syndicated Loan Market – While the syndicated loan market is modestly more accommodating to middle market issuers, as with bonds, loan issue size and liquidity are key drivers of institutional appetite and, correspondingly, underwriters’ willingness to underwrite the loans. Loans arranged through a bank are done either on a “best efforts” basis or are underwritten with terms plus provisions that permit the underwriters to change certain terms, including pricing, structure, yield and tenor, otherwise known as “flex”, to successfully syndicate the loan, in the event the terms initially marketed are insufficiently attractive to investors. Furthermore, banks are generally reluctant to underwrite middle market loans because the arrangement fees they may earn on the placement of the debt generally are not sufficient to meet the banks’ return hurdles. Loans provided by companies such as ours provide certainty to issuers in that we can commit to a given amount of debt on specific terms, at stated coupons and with agreed upon fees. As we are the ultimate holder of the loans, we do not require market “flex” or other arrangements that banks may require when acting on an agency basis.

Robust Demand for Debt Capital. We believe U.S. middle market companies will continue to require access to debt capital to refinance existing debt, support growth and finance acquisitions. In addition, we believe the large amount of uninvested capital held by funds of private equity firms broadly, estimated by Preqin Ltd., an alternative assets industry data and research company, to be $1.7 trillion as of January 2022, will continue to drive deal activity. We expect that private equity sponsors will continue to pursue acquisitions and leverage their equity investments with secured loans provided by companies such as us.

The Middle Market is a Large Addressable Market. According to GE Capital’s National Center for the Middle Market 4th quarter 2021 Middle Market Indicator, there are approximately 200,000 U.S. middle market companies, which have approximately 48 million aggregate employees. Moreover, the U.S. middle market accounts for one-third of private sector gross domestic product (“GDP”). GE defines U.S. middle market companies as those between $10 million and $1 billion in annual revenue, which we believe has significant overlap with our definition of U.S. middle market companies.

Attractive Investment Dynamics. An imbalance between the supply of, and demand for, middle market debt capital creates attractive pricing dynamics. We believe the directly negotiated nature of middle market financings also generally provides more favorable terms to the lender, including stronger covenant and reporting packages, better call protection, and lender-protective change of control provisions. Additionally, we believe BDC managers’ expertise in credit selection and ability to manage through credit cycles has generally resulted in BDCs experiencing lower loss rates than U.S. commercial banks through credit cycles. Further, we believe that historical middle market default rates have been lower, and recovery rates have been higher, as compared to the larger market capitalization, broadly distributed market, leading to lower cumulative losses. Lastly, we believe that in the current environment, lenders with available capital may be able to take advantage of attractive investment opportunities as the economy reopens and may be able to achieve improved economic spreads and documentation terms.

Conservative Capital Structures. Following the credit crisis, which we define broadly as occurring between mid-2007 and mid-2009, lenders have generally required borrowers to maintain more equity as a percentage of their total capitalization, specifically to protect lenders during economic downturns. With more conservative capital structures, U.S. middle market companies have exhibited higher levels of cash flows available to service their debt. In addition, U.S. middle market companies often are characterized by simpler capital structures than larger borrowers, which facilitates a streamlined underwriting process and, when necessary, restructuring process.

Attractive Opportunities in Investments in Loans. We invest in senior secured or unsecured loans, subordinated loans or mezzanine loans and, to a lesser extent, equity and equity-related securities. We believe that opportunities in senior secured loans are significant because of the floating rate structure of most senior secured debt issuances and because of the strong defensive characteristics of these types of investments. Given the current low interest rate environment, we believe that debt issues with floating interest rates offer a superior return profile as compared with fixed-rate investments, since floating rate structures are generally less susceptible to declines in value experienced by fixed-rate securities in a rising interest rate environment. Senior secured debt also provides strong defensive characteristics. Senior secured debt has priority in payment among an issuer’s security holders whereby holders are due to receive payment before junior creditors and equity holders. Further, these investments are secured by the issuer’s assets, which may provide protection in the event of a default.

Portfolio and Investment Activity

As of March 31, 2022, based on fair value, our portfolio consisted of 73.5% first lien senior secured debt investments (of which 60% we consider to be unitranche debt investments (including “last-out” portions of such loans)), 20.2% second-lien senior secured debt investments, 1.5% unsecured investments, 1.9% preferred equity investments and 2.9% common equity investments.

As of March 31, 2022, our weighted average total yield of the portfolio at fair value and amortized cost was 7.8% and 7.8%, respectively, and our weighted average yield of accruing debt and income producing securities at fair value and amortized cost was 7.9% and 7.9%, respectively.

As of March 31, 2022, we had investments in 147 portfolio companies with an aggregate fair value of $2.4 billion. As of March 31, 2021, we had net leverage of 0.77x debt-to-equity.

Based on current market conditions, the pace of our investment activities, including originations and repayments, may vary. The strength of the financing and merger and acquisitions markets and the current low interest rate environment, has led to increased originations and an active pipeline of investment opportunities including demand for large unitranche debt investments. However, there have been headwinds in the financing and merger and acquisitions markets resulting from high and persistent inflation, a shifting interest rate environment, geopolitical events and the ongoing impact from COVID-19 globally. We are monitoring the effect that market volatility, including as a result of a rising interest rate environment may have on our portfolio companies and our investment activities and we will continue to seek to invest in recession-resistant industries that we are familiar with.

Our investment activity for the three months ended March 31, 2022 and 2021 is presented below (information presented herein is at par value unless otherwise indicated).


($ in thousands)	For the Three Months Ended March 31,
	2022			2021
New investment commitments
Gross originations	$	34,064		$	188,135
Less: Sell downs		(45	)		(10,855	)
Total new investment commitments	$	34,019		$	177,280
Principal amount of investments funded:
First-lien senior secured debt investments	$	23,754		$	108,402
Second-lien senior secured debt investments		1,000			19,767
Unsecured debt investments		997			26,458
Preferred equity investments(3)		1,000			1,370
Common equity investments(3)		651			—
Total principal amount of investments funded	$	27,402		$	155,997
Principal amount of investments sold or repaid:
First-lien senior secured debt investments	$	(56,615	)	$	(72,704	)
Second-lien senior secured debt investments		—			(36,818	)
Unsecured debt investments		—			—
Preferred equity investments(3)		(3,046	)		—
Common equity investments(3)		—			—
Total principal amount of investments sold or repaid	$	(59,661	)	$	(109,522	)
Number of new investment commitments in new portfolio companies(1)		16			7
Average new investment commitment amount	$	1,980		$	20,062
Weighted average term for new investment commitments (in years)		5.0			5.8
Percentage of new debt investment commitments at floating rates		92.3	%		100.0	%
Percentage of new debt investment commitments at fixed rates		7.7	%		0.0	%
Weighted average interest rate of new investment commitments(2)		7.5	%		7.0	%
Weighted average spread over LIBOR of new floating rate investment commitments		6.1	%		6.2	%

________________

(1)

Number of new investment commitments represents commitments to a particular portfolio company.

(2)

Assumes each floating rate commitment is subject to the greater of the interest rate floor (if applicable) or 3-month LIBOR, which was 0.96% and 0.19% as of March 31, 2022 and 2021, respectively.

(3)

As of March 31, 2021, preferred equity investments and common equity investments were reported in aggregate as equity investments.

Investments at fair value and amortized cost consisted of the following as of March 31, 2022 and December 31, 2021:


	March 31, 2022					December 31, 2021
($ in thousands)	Amortized Cost		Fair Value			Amortized Cost		Fair Value
First-lien senior secured debt investments	$	1,762,387	$	1,753,382	(1)	$	1,785,730	$	1,784,326	(2)
Second-lien senior secured debt investments		483,643		481,553			482,323		484,500
Unsecured debt investments		36,604		35,175			34,524		34,133
Preferred equity investments		46,135		46,259			48,397		49,313
Common equity investments		51,275		68,317			50,226		67,256
Total Investments	$	2,380,044	$	2,384,686		$	2,401,200	$	2,419,528

________________

(1)

60% of which we consider unitranche loans.

(2)

53% of which we consider unitranche loans.

The table below describes investments by industry composition based on fair value as of March 31, 2022 and December 31, 2021:


	March 31, 2022			December 31, 2021
Advertising and media		0.6	%		0.6	%
Aerospace and defense		3.3			3.3
Automotive		1.5			1.4
Buildings and real estate		4.6			5.0
Business services		3.8			3.7
Chemicals		3.3			3.3
Consumer products		4.4			4.8
Containers and packaging		1.3			1.3
Distribution		3.3			3.1
Education		1.1			1.1
Financial services		6.3			6.2
Food and beverage		7.4			7.3
Healthcare equipment and services		3.8			3.7
Healthcare providers and services		7.5			8.1
Healthcare technology		5.8			5.9
Household products		1.9			1.8
Human resource support services		1.3			1.3
Infrastructure and environmental services		0.5			0.5
Insurance		7.6			7.4
Internet software and services		13.0			12.7
Leisure and entertainment		2.6			2.5
Manufacturing		6.3			6.3
Oil and gas		1.1			1.1
Professional services		2.0			2.0
Specialty retail		2.8			2.8
Transportation		2.9			2.8
Total		100.0	%		100.0	%

The table below describes investments by geographic composition based on fair value as of March 31, 2022 and December 31, 2021:


	March 31, 2022			December 31, 2021
United States:
Midwest		17.3	%		17.1	%
Northeast		16.6			16.7
South		36.8			37.3
West		22.1			21.9
International		7.2			7.0
Total		100.0	%		100.0	%

The weighted average yields and interest rates of our investments at fair value as of March 31, 2022 and December 31, 2021 were as follows:


	March 31, 2022			December 31, 2021
Weighted average total yield of portfolio		7.8	%		7.8	%
Weighted average total yield of accruing debt and income producing securities		7.9	%		7.9	%
Weighted average interest rate of accruing debt securities		7.5	%		7.4	%
Weighted average spread over LIBOR of all accruing floating rate investments		6.5	%		6.5	%

The weighted average yield of our accruing debt and income producing securities is not the same as a return on investment for our shareholders but, rather, relates to a portion of our investment portfolio and is calculated before the payment of all of our and our subsidiaries’ fees and expenses. The weighted average yield was computed using the effective interest rates as of each respective date, including accretion of original issue discount and loan origination fees, but excluding investments on non-accrual status, if any. There can be no assurance that the weighted average yield will remain at its current level.

Our Adviser monitors our portfolio companies on an ongoing basis. It monitors the financial trends of each portfolio company to determine if they are meeting their respective business plans and to assess the appropriate course of action with respect to each portfolio company. Our Adviser has several methods of evaluating and monitoring the performance and fair value of our investments, which may include the following:

•

assessment of success of the portfolio company in adhering to its business plan and compliance with covenants;

•

periodic and regular contact with portfolio company management and, if appropriate, the financial or strategic sponsor, to discuss financial position, requirements and accomplishments;

•

comparisons to other companies in the portfolio company’s industry; and

•

review of monthly or quarterly financial statements and financial projections for portfolio companies.

As part of the monitoring process, our Adviser employs an investment rating system to categorize our investments. In addition to various risk management and monitoring tools, our Adviser rates the credit risk of all investments on a scale of 1 to 5. This system is intended primarily to reflect the underlying risk of a portfolio investment relative to our initial cost basis in respect of such portfolio investment (i.e., at the time of origination or acquisition), although it may also take into account the performance of the portfolio company’s business, the collateral coverage of the investment and other relevant factors. The rating system is as follows:


Investment Rating		Description
1		Investments rated 1 involve the least amount of risk to our initial cost basis. The borrower is performing above expectations, and the trends and risk factors for this investment since origination or acquisition are generally favorable;
2		Investments rated 2 involve an acceptable level of risk that is similar to the risk at the time of origination or acquisition. The borrower is generally performing as expected and the risk factors are neutral to favorable. All investments or acquired investments in new portfolio companies are initially assessed a rating of 2;
3		Investments rated 3 involve a borrower performing below expectations and indicates that the loan’s risk has increased somewhat since origination or acquisition;
4		Investments rated 4 involve a borrower performing materially below expectations and indicates that the loan’s risk has increased materially since origination or acquisition. In addition to the borrower being generally out of compliance with debt covenants, loan payments may be past due (but generally not more than 120 days past due); and
5		Investments rated 5 involve a borrower performing substantially below expectations and indicates that the loan’s risk has increased substantially since origination or acquisition. Most or all of the debt covenants are out of compliance and payments are substantially delinquent. Loans rated 5 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 Adviser rates the investments in our portfolio at least quarterly and it is possible that the rating of a portfolio investment may be reduced or increased over time. For investments rated 3, 4 or 5, our Adviser enhances its level of scrutiny over the monitoring of such portfolio company.

The following table shows the composition of our portfolio on the 1 to 5 rating scale as of March 31, 2022 and December 31, 2021:


	March 31, 2022					December 31, 2021
Investment Rating	Investments at Fair Value		Percentage of Total Portfolio			Investments at Fair Value		Percentage of Total Portfolio
($ in thousands)
1	$	389,747		16.3	%	$	353,264		14.6	%
2		1,785,912		74.9			1,872,968		77.4
3		206,632		8.7			190,393		7.9
4		2,395		0.1			2,903		0.1
5		—		—			—		—
Total	$	2,384,686		100.0	%	$	2,419,528		100.0	%

The following table shows the amortized cost of our performing and non-accrual debt investments as of March 31, 2022 and December 31, 2021:


	March 31, 2022					December 31, 2021
($ in thousands)	Amortized Cost		Percentage			Amortized Cost		Percentage
Performing	$	2,277,805		99.8	%	$	2,297,746		99.8	%
Non-accrual		4,829		0.2			4,831		0.2
Total	$	2,282,634		100.0	%	$	2,302,577		100.0	%

Results of Operations

The following table represents the operating results for the three months ended March 31, 2022 and 2021:


	Three Months Ended March 31,
($ in thousands)	2022			2021
Total Investment Income	$	48,379		$	42,940
Less: Net Operating Expenses		25,126			21,567
Net Investment Income (Loss) Before Taxes		23,253			21,373
Less: Income tax expense (benefit), including excise tax expense (benefit)		269			311
Net Investment Income (Loss) After Taxes		22,984			21,062
Net change in unrealized gain (loss)		(13,719	)		10,834
Net realized gain (loss)		740			367
Net Increase (Decrease) in Net Assets Resulting from Operations	$	10,005		$	32,263

Net increase (decrease) in net assets resulting from operations can vary from period to period as a result of various factors, including the level of new investment commitments, expenses, the recognition of realized gains and losses and changes in unrealized appreciation and depreciation on the investment portfolio. For the quarter ended March 31, 2022, our net asset value per share decreased slightly, primarily driven by market spreads widening.

Investment Income

Investment income for the three months ended March 31, 2022 and 2021 were as follows:


	Three Months Ended March 31,
($ in thousands)	2022		2021
Interest income from investments(1)	$	41,047	$	39,646
Payment-in-kind interest income(1)		4,037		1,765
Dividend income		2,535		1,026
Other income		760		503
Total investment income	$	48,379	$	42,940

________________

(1)

For the three months ended March 31, 2021, interest income and payment-in-kind interest income were reported in aggregate as interest income.

100

For the Three Months Ended March 31, 2022 and 2021

Investment income increased to $48.4 million for the three months ended March 31, 2022 from $42.9 million for the same period in the prior year primarily due to an increase in our debt investment portfolio, which, at par, increased from $2.2 billion as of March 31, 2021 to $2.3 billion as of March 31, 2022. In addition to the portfolio growth, the incremental increase in investment income for the period was further driven by dividend income earned from our investment in the Windows Entities, which increased to $1.2 million from $0.9 million for the three months ended March 31, 2022 and 2021, respectively. Included in interest income are other fees such as prepayment fees and accelerated amortization of upfront fees from unscheduled paydowns. Period over period, income generated from unscheduled paydown activity decreased to $1.1 million from $1.2 million, for the three months ended March 31, 2022 and 2021, respectively, and was driven in part by a decrease in unscheduled paydowns. For the three months ended March 31, 2022 and 2021, PIK income represented 10.3% and less than 5% of investment income, respectively. Other income increased period-over-period due to an increase in incremental fee income, which are fees that are generally available to us as a result of closing investments and generally paid at the time of closing. We expect that investment income will vary based on a variety of factors including the pace of our originations and repayments.

Expenses

Expenses for the three months ended March 31, 2022 and 2021 were as follows:


	Three Months Ended March 31,
($ in thousands)	2022		2021
Offering costs	$	—	$	385
Interest expense		10,257		8,520
Management fee		9,084		8,214
Performance based incentive fees		3,357		3,848
Professional fees		1,393		1,177
Directors' fees		314		261
Other general and administrative		721		611
Total operating expenses	$	25,126	$	23,016
Expense Support		—		(1,449	)
Net operating expenses	$	25,126	$	21,567

For the Three Months Ended March 31, 2022 and 2021

Net operating expenses increased to $25.1 million for the three months ended March 31, 2022 from $21.6 million for the same period ended March 31, 2021 primarily due to a decrease in expense support and increases in management fees and interest expense, partially offset by a decrease in performance based incentive fees. The increase in interest expense of $1.7 million was driven by an increase in average daily borrowings to $1.1 billion from $0.9 billion period over period and by an increase in the weighted average cost of debt from 3.4% to 3.5%. The increase in management fees of $0.9 million is due to an increase in average gross assets driven primarily by an increase in investments. During the three months ended March 31, 2022 compared to the three months ended March 31, 2021, the decrease in performance based incentive fees of $0.5 million is due to a decrease in pre-incentive fee net investment income and unrealized losses on our investments.

Net Unrealized Gain (Loss)

We fair value our portfolio investments quarterly and any changes in fair value are recorded as unrealized gains or losses. During the three months ended March 31, 2022 and 2021, net unrealized gains (losses) were comprised of the following:


	Three Months Ended March 31,
($ in thousands)	2022			2021
Net change in unrealized gain on investments	$	2,706		$	16,211
Net change in unrealized loss on investments		(15,006	)		(3,948	)
Income tax (provision) benefit		—			(878	)
Translation of assets and liabilities in foreign currencies		(1,419	)		(551	)
Net change in unrealized gain (loss)	$	(13,719	)	$	10,834

101

For the Three Months Ended March 31, 2022 and 2021

For the three months ended March 31, 2022, the net unrealized loss was primarily driven by a decrease in the fair value of our debt investments as compared to December 31, 2021. As of March 31, 2022, the fair value of our debt investments as a percentage of principal was 97.9% as compared to 98.4% as of December 31, 2021. The primary driver of our portfolio’s unrealized loss was due to current market conditions and credit spreads widening.

The ten largest contributors to the change in net unrealized gain (loss) on investments during the three months ended March 31, 2022 consisted of the following:


Portfolio Company ($ in thousands)	Net Change in Unrealized Gain (Loss)
Entertainment Benefits Group, LLC	$	1,052
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)		923
Remaining portfolio companies		(8,739	)
Hg Saturn Luchaco Limited		(831	)
Norvax, LLC (dba GoHealth)		(811	)
H-Food Holdings, LLC		(765	)
Valence Surface Technologies LLC		(709	)
Packaging Coordinators Midco, Inc.		(685	)
Walker Edison Furniture Company LLC		(681	)
Metis HoldCo, Inc. (dba Mavis Tire Express Services)		(548	)
CIBT Global, Inc.		(506	)
Net unrealized gain (loss) on investments	$	(12,300	)

For the three months ended March 31, 2021, the net unrealized gain was primarily driven by an increase in the fair value of our debt investments as compared to December 31, 2020. As of March 31, 2021, the fair value of our debt investments as a percentage of principal was 98.2% as compared to 97.7% as of December 31, 2020.

The ten largest contributors to the change in net unrealized gain (loss) on investments during the three months ended March 31, 2021 consisted of the following:


Portfolio Company ($ in thousands)	Net Change in Unrealized Gain (Loss)
Windows Entities	$	3,345
Innovative Water Care Global Corporation		1,175
Blackhawk Network Holdings, Inc.		700
Aviation Solutions Midco, LLC (dba STS Aviation)		609
Sonny's Enterprises LLC		568
Mavis Tire Express Services Corp.		476
H-Food Holdings, LLC		428
Remaining portfolio companies		7,322
CIBT Global, Inc.		(1,255	)
Galls, LLC		(626	)
Norvax, LLC (dba GoHealth)		(479	)
Net unrealized gain (loss) on investments	$	12,263

Net Realized Gain (Loss)

The realized gains and losses on fully exited and partially exited portfolio companies during the three months ended March 31, 2022 and 2021 were comprised of the following:


	Three Months Ended March 31,
($ in thousands)	2022			2021
Net realized gain (loss) on investments	$	795		$	197
Net realized gain (loss) on foreign currency transactions		(55	)		170
Net realized gain (loss)	$	740		$	367

102

Realized Gross Internal Rate of Return

Since we began investing in 2017 through March 31, 2022, our exited investments have resulted in an aggregate cash flow realized gross internal rate of return to us of over 9.6% (based on total capital invested of $1.4 billion and total proceeds from these exited investments of $1.6 billion). Over seventy percent of these exited investments resulted in an aggregate cash flow realized gross internal rate of return (“IRR”) to us of 8% or greater.

IRR, is a measure of our discounted cash flows (inflows and outflows). Specifically, IRR is the discount rate at which the net present value of all cash flows is equal to zero. That is, IRR is the discount rate at which the present value of total capital invested in each of our investments is equal to the present value of all realized returns from that investment. Our IRR calculations are unaudited.

Capital invested, with respect to an investment, represents the aggregate cost basis allocable to the realized or unrealized portion of the investment, net of any upfront fees paid at closing for the term loan portion of the investment.

Realized returns, with respect to an investment, represents the total cash received with respect to each investment, including all amortization payments, interest, dividends, prepayment fees, upfront fees (except upfront fees paid at closing for the term loan portion of an investment), administrative fees, agent fees, amendment fees, accrued interest, and other fees and proceeds.

Gross IRR, with respect to an investment, is calculated based on the dates that we invested capital and dates we received distributions, regardless of when we made distributions to our shareholders. Initial investments are assumed to occur at time zero.

Gross IRR reflects historical results relating to our past performance and is not necessarily indicative of our future results. In addition, gross IRR does not reflect the effect of management fees, expenses, incentive fees or taxes borne, or to be borne, by us or our shareholders, and would be lower if it did.

Aggregate cash flow realized gross IRR on our exited investments reflects only invested and realized cash amounts as described above and does not reflect any unrealized gains or losses in our portfolio.

Financial Condition, Liquidity and Capital Resources

Our liquidity and capital resources are generated primarily from the net proceeds of any offering of our common stock and from cash flows from interest, dividends and fees earned from our investments and principal repayments and proceeds from sales of our investments. The primary uses of our cash are for (i) investments in portfolio companies and other investments and to comply with certain portfolio diversification requirements, (ii) the cost of operations (including paying or reimbursing our Adviser), (iii) debt service, repayment and other financing costs of any borrowings and (iv) cash distributions to the holders of our shares.

We may from time to time enter into additional debt facilities, increase the size of our existing credit facilities or issue additional debt securities. Any such incurrence or issuance would be subject to prevailing market conditions, our liquidity requirements, contractual and regulatory restrictions and other factors. In accordance with the 1940 Act, with certain limited exceptions, we are only allowed to incur borrowings, issue debt securities or issue preferred stock, if immediately after the borrowing or issuance, the ratio of total assets (less total liabilities other than indebtedness) to total indebtedness plus preferred stock, is at least 200% (or 150% if certain conditions are met). As of March 31, 2022 and December 31, 2021, our asset coverage ratios were 224% and 221%, respectively. We seek to carefully consider our unfunded commitments for the purpose of planning our ongoing financial leverage. Further, we maintain sufficient borrowing capacity within the 200% (or 150% if certain conditions are met) asset coverage limitation to cover any outstanding unfunded commitments we are required to fund.

Cash as of March 31, 2022, taken together with our available debt, is expected to be sufficient for our investing activities and to conduct our operations in the near term. As of March 31, 2022, we had $37.0 million in cash. During the three months ended March 31, 2022, cash provided by operating activities was $57.0 million, primarily as a result of selldowns and repayments of portfolio investments of $82.8 million and other operating activities of $27.3 million, partially offset by funding portfolio investments of $53.1 million Lastly, we used $74.1 million in cash for financing activities during the period, which was the result of debt issuance costs of $1.3 million, net repayments on our credit facilities of $45.0 million, distributions paid of $12.4 million and repurchased shares of $15.4 million. Our long-term cash needs will include principal payments on outstanding indebtedness and funding of additional portfolio investments. Funding for long-term cash needs will come from unused net proceeds from financing activities. We believe that our liquidity and sources of capital are adequate to satisfy our short and long-term cash requirements. We cannot, however, be certain that these sources of funds will be available at a time and upon terms acceptable to us in sufficient amounts in the future.

103

As of March 31, 2021, we had $39.5 million in cash. During the three months ended March 31, 2021, we used $16.8 million in cash for operating activities, primarily as a result of funding portfolio investments of $181.6 million, partially offset by selldowns and repayments of portfolio investments of $130.9 million, and other operating activity of $33.9 million. Lastly, cash provided by financing activities was $13.5 million during the period, which was the result of proceeds from the issuance of shares of $51.9 million, partially offset by net paydowns on our credit facilities of $26.0 million, distributions paid of $12.3 million and debt issuance costs of $0.1 million.

Net Assets

Share Issuances

In connection with our formation, we had the authority to issue 300,000,000 common shares at $0.01 per share par value. Effective as of June 18, 2019, we amended our charter to increase the number of shares of common stock we are authorized to issue from 300,000,000 to 450,000,000. Pursuant to our Registration Statement on Form N-2 (File No. 333-213716), we registered 264,000,000 common shares, par value of $0.01 per share, at an initial public offering price of $9.47 per share and pursuant to our Registration Statement on Form N-2 (File No. 333-232183), we registered an additional 160,000,000 common shares, par value $0.01 per share, at an initial public offering price of $9.56 per share.

On September 30, 2016, we issued 100 common shares for $900 to the Adviser. We received $900 in cash from the Adviser on November 17, 2016.

On April 4, 2017, we received subscription agreements totaling $10 million for the purchase of shares of our common stock from a private placement from certain individuals and entities affiliated with the Adviser. Pursuant to the terms of those subscription agreements, the individuals and entities affiliated with the Adviser agreed to pay for such shares of common stock upon demand by one of our executive officers. On April 4, 2017, we sold 277,778 shares pursuant to such subscription agreements and met the minimum offering requirement for our continuous public offering of $2.5 million. The purchase price of these shares sold in the private placement was $9.00 per share, which represented the initial public offering price of $9.47 per share, net of selling commissions and dealer manager fees.

The following table summarizes transactions with respect to shares of our common stock during the three months ended March 31, 2022 and 2021:


	March 31, 2022						March 31, 2021
($ in thousands, except share amounts)	Shares			Amount			Shares		Amount
Shares/gross proceeds from the continuous public offering		—		$	—			6,145,519	$	55,822
Reinvestment of distributions		1,171,526			10,481			1,141,994		10,186
Repurchased Shares		(1,730,010	)		(15,362	)		—		—
Total shares/gross proceeds		(558,484	)		(4,881	)		7,287,513		66,008
Sales load		—			—			—		(1,095	)
Total shares/net proceeds		(558,484	)	$	(4,881	)		7,287,513	$	64,913

104

Prior to the termination of our continuous public offering, in the event of a material decline in our net asset value per share, which we consider to be a 2.5% decrease below its current net offering price, our Board reduced the offering price in order to establish a new net offering price per share that was not more than 2.5% above the net asset value. We will not sell shares at a net offering price below the net asset value per share unless we obtain the requisite approval from our shareholders. The changes to our offering price per share since the commencement of our initial continuous public offering and associated approval and effective dates of such changes were as follows:


Approval Date	Effective Date	Gross Offering Price Per Share		Net Offering Price Per Share
Initial Offering Price	April 4, 2017	$	9.47	$	9.00
May 2, 2017	May 3, 2017	$	9.52	$	9.04
January 17, 2018	January 17, 2018	$	9.53	$	9.05
January 31, 2018	January 31, 2018	$	9.55	$	9.07
July 18, 2018	July 18, 2018	$	9.56	$	9.08
October 9, 2018	October 10, 2018	$	9.57	$	9.09
January 22, 2019	January 23, 2019	$	9.46	$	8.99
February 19, 2019	February 20, 2019	$	9.51	$	9.03
February 27, 2019	February 27, 2019	$	9.52	$	9.04
April 3, 2019	April 3, 2019	$	9.54	$	9.06
April 9, 2019	April 10, 2019	$	9.55	$	9.07
July 3, 2019	July 3, 2019	$	9.56	$	9.08
October 9, 2019	October 9, 2019	$	9.49	$	9.02
January 15, 2020	January 15, 2020	$	9.51	$	9.03
March 10, 2020	March 11, 2020	$	9.41	$	8.94
March 18, 2020	March 18, 2020	$	8.83	$	8.39
March 25, 2020	March 25, 2020	$	8.74	$	8.30
April 15, 2020	April 15, 2020	$	8.80	$	8.36
April 22, 2020	April 22, 2020	$	8.85	$	8.41
May 19, 2020	May 20, 2020	$	8.87	$	8.43
May 27, 2020	May 27, 2020	$	8.93	$	8.48
June 2, 2020	June 3, 2020	$	8.96	$	8.51
June 9, 2020	June 10, 2020	$	9.02	$	8.57
June 16, 2020	June 17, 2020	$	9.05	$	8.60
July 14, 2020	July 15, 2020	$	9.08	$	8.63
July 22, 2020	July 22, 2020	$	9.12	$	8.66
July 29, 2020	July 29, 2020	$	9.14	$	8.68
August 19, 2020	August 19, 2020	$	9.16	$	8.70
August 26, 2020	August 26, 2020	$	9.18	$	8.72
September 9, 2020	September 9, 2020	$	9.21	$	8.75
September 23, 2020	September 23, 2020	$	9.24	$	8.78
December 23, 2020	December 23, 2020	$	9.32	$	8.85
January 6, 2021	January 6, 2021	$	9.37	$	8.90
March 23, 2021	March 24, 2021	$	9.42	$	8.95

We have determined not to file additional post-effective amendments to our registration statement and terminated our offering as of April 30, 2021.

105

Subsequent to April 30, 2021, we calculated the price per share that shares issued pursuant to the dividend reinvestment plan were issued as follows:


Date of Issuance	Record Date	Number of Shares		Purchase Price per Share
May 26, 2021	May 25, 2021		364,726	$	8.93
June 30, 2021	June 29, 2021		450,718	$	8.99
July 28, 2021	July 27, 2021		392,202	$	8.95
August 25, 2021	August 24, 2021		389,897	$	8.95
September 29, 2021	September 28, 2021		384,273	$	9.00
October 27, 2021	October 26, 2021		387,954	$	8.96
November 24, 2021	November 23, 2021		389,853	$	8.95
December 29, 2021	December 28, 2021		387,939	$	9.00
January 26, 2022	January 25, 2022		389,571	$	8.98
February 23, 2022	February 22, 2022		390,759	$	8.98
March 30, 2022	March 29, 2022		391,196	$	8.88

Distributions

Our Board has authorized and declared weekly distribution amounts per share of common stock through June 30, 2021 and monthly distribution amounts per share of common stock thereafter, payable monthly in arrears. The following table presents cash distributions per share that were declared during the three months ended March 31, 2022:


	Distributions
($ in thousands)	Per Share		Amount
2022
March 31, 2022 (three record dates)	$	0.15	$	22,847
Total	$	0.15	$	22,847

During certain periods, our distributions may exceed our earnings. As a result, it is possible that a portion of the distributions we make may represent a return of capital. A return of capital generally is a return of a shareholder’s investment rather than a return of earnings or gains derived from our investment activities. Each year a statement on Form 1099-DIV identifying the tax character of the distributions will be mailed to our shareholders. The tax character of the distributions are not determined until the Company’s taxable year end.

The following table presents cash distributions per share that were declared during the three months ended March 31, 2021:


	Distributions
($ in thousands)	Per Share		Amount
2021
March 31, 2021 (thirteen record dates)	$	0.15	$	22,434
Total	$	0.15	$	22,434

On February 23, 2021, our Board declared regular weekly distributions for April 2021 through June 2021. The regular weekly cash distributions, each in the gross amount of $0.011580 per share, will be payable monthly to shareholders of record as of the weekly record date.

On May 5, 2021, our Board declared regular monthly distributions for July 2021 through September 2021. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

On January 25, 2022, our Board declared regular monthly distributions for January 2022 through March 2022. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

On February 23, 2022, our Board declared regular monthly distributions for April 2022 through June 2022. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

106

On March 30, 2022, our Board declared a regular quarterly distribution payable on or before April 28, 2022 to shareholders of record as of March 31, 2022, equal to 100% of the Company's investment company taxable income and net capital gains for the taxable quarter, to the extent such amount exceeds $0.15054 per share, but is less than or equal to $0.167271 per share, which, for the quarter ended March 31, 2022, was equal to $0.15054.

With respect to distributions, we have adopted an “opt-in” dividend reinvestment plan for common shareholders. As a result, in the event of a declared distribution, each shareholder that has not “opted-in” to the dividend reinvestment plan will have their dividends or distributions automatically received in cash rather than reinvested in additional shares of our common stock. Shareholders who receive distributions in the form of shares of common stock will be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions.

We may fund our cash distributions to shareholders from any source of funds available to us, including but not limited to offering proceeds, net investment income from operations, capital gains proceeds from the sale of assets, dividends or other distributions paid to us on account of preferred and common equity investments in portfolio companies and expense support from the Adviser, which is subject to recoupment. In no event, however, will funds be advanced or borrowed for purpose of distributions, if the amount of such distributions would exceed our accrued and received Net Revenues for the previous four quarters, less paid and accrued operating expenses with respect to such revenues and costs.

Through March 31, 2022, a portion of our distributions resulted from expense support from the Adviser, and future distributions may result from expense support from the Adviser, each of which is subject to repayment by us within three years from the date of payment. The purpose of this arrangement is to avoid distributions being characterized as a return of capital for U.S. federal income tax purposes. Shareholders should understand that any such distributions are not based on our investment performance and can only be sustained if we achieve positive investment performance in future periods and/or the Adviser continues to provide expense support. Shareholders should also understand that our future repayments of expense support will reduce the distributions that they would otherwise receive. There can be no assurance that we will achieve the performance necessary to sustain these distributions or be able to pay distributions at all.

107

Sources of distributions, other than net investment income and realized gains on a U.S. GAAP basis, include required adjustments to U.S. GAAP net investment income in the current period to determine taxable income available for distributions. The following tables reflect the sources of cash distributions on a U.S. GAAP basis that we have declared on our shares of common stock during the three months ended March 31, 2022 and 2021:


	Three Months Ended March 31, 2022
Source of Distribution	Per Share			Amount			Percentage
($ in thousands, except per share amounts)
Net investment income	$	0.16		$	22,984			100.6		%
Net realized gain on investments(1)		—			740			3.2
Distributions in excess of (undistributed) net investment income and realized gains		(0.01	)		(877	)		(3.8	)
Total	$	0.15		$	22,847			100.0		%

________________

(1)

The per share amount rounds to less than $0.01 per share.


	Three Months Ended March 31, 2021
Source of Distribution	Per Share		Amount		Percentage
($ in thousands, except per share amounts)
Net investment income	$	0.14	$	21,062		93.9	%
Net realized gain (loss) on investments(1)		—		367		1.6
Distributions in excess of net investment income		0.01		1,005		4.5
Total	$	0.15	$	22,434		100.0	%

________________

(1)

The per share amount rounds to less than $0.01 per share.

108

Share Repurchases

In the third quarter of 2017, we began offering, and on a quarterly basis, intend to continue offering, to repurchase shares of our common stock on such terms as may be determined by our Board in its complete discretion. The Board has complete discretion to determine whether we will engage in any share repurchase, and if so, the terms of such repurchase. At the discretion of our Board, the Company may use cash on hand, cash available from borrowings, and cash from the sale of our investments as of the end of the applicable period to repurchase shares.

All shares purchased by us pursuant to the terms of each offer to repurchase will be retired and thereafter will be authorized and unissued shares.

Any periodic repurchase offers are subject in part to our available cash and compliance with the BDC and RIC qualification and diversification rules promulgated under the 1940 Act and the Code, respectively. While we intend to continue to conduct quarterly tender offers as described above, we are not required to do so and may suspend or terminate the share repurchase program at any time.


Offer Date	Tender Offer Expiration	Tender Offer		Purchase Price per Share		Shares Repurchased
March 4, 2019	March 29, 2019	$	6,207,452	$	9.06		119,874
May 13, 2019	June 10, 2019	$	9,039,928	$	9.07		100,108
August 19, 2019	September 16, 2019	$	13,085,063	$	9.08		234,693
November 18, 2019	December 16, 2019	$	16,984,077	$	9.02		396,914
March 9, 2020	April 3, 2020	$	21,398,616	$	8.30		1,462,441
May 26, 2020	June 22, 2020	$	16,280,933	$	8.60		600,204
August 24, 2020	September 21, 2020	$	21,493,631	$	8.78		1,797,979
November 16, 2020	December 14, 2020	$	16,153,577	$	8.78		794,091
March 10, 2021	April 6, 2021	$	18,995,153	$	8.95		1,945,553
June 1, 2021	June 28, 2021	$	19,621,539	$	8.99		2,182,596
August 30, 2021	September 27, 2021	$	11,911,588	$	9.00		1,323,510
November 29, 2021	December 27, 2021	$	11,859,682	$	9.00		1,317,742
March 1, 2022	March 28, 2022	$	15,362,486	$	8.88		1,730,010

109

Total Return Since Inception

Cumulative total return for the period April 4, 2017 to March 31, 2022 was 41.9% (without upfront sales load) and 34.8% (with maximum upfront sales load). The following table presents cumulative total returns for the three months ended March 31, 2022, rolling 1-year, 3-year and 5-year periods and since inception.

Shareholder Returns (Without Sales Charge)

Shareholder Returns (With Maximum Sales Charge)

Annualized Total Return

YTD

1-Year

3-Year

5-Year

Since Inception

Cumulative Total Return Since Inception

Total Shareholder Returns(1)(2)

0.6%

6.3%

7.4%

8.4%

41.9%

34.8%

________________

(1)

Compounded monthly.

(2)

Past performance does not guarantee future results. Returns reflect reinvestment of distributions and the deduction of ongoing expenses that are borne by investors, such as management fees, incentive fees, interest expense, offering costs, professional fees, director fees and other general and administrative expenses. An investment in the Company is subject to a maximum upfront sales load of 5% of the offering price, which will reduce the amount of capital available for investment. Operating expenses may vary in the future based on the amount of capital raised, the Adviser’s election to continue expense support, and other unpredictable variables.

110

Debt

Aggregate Borrowings

Our debt obligations consisted of the following as of March 31, 2022 and December 31, 2021:


	March 31, 2022
($ in thousands)	Aggregate Principal Committed		Outstanding Principal		Amount Available(1)		Net Carrying Value(2)
SPV Asset Facility I	$	500,000	$	467,227	$	15,809	$	466,681
SPV Asset Facility II		325,000		155,000		128,491		151,043
2024 Notes		450,000		450,000		—		450,269
Total Debt	$	1,275,000	$	1,072,227	$	144,300	$	1,067,993

________________

(1)

The amount available reflects any limitations related to each credit facility’s borrow base.

(2)


	December 31, 2021
($ in thousands)	Aggregate Principal Committed		Outstanding Principal		Amount Available(1)		Net Carrying Value(2)
SPV Asset Facility I	$	500,000	$	412,182	$	18,513	$	411,474
SPV Asset Facility II		325,000		255,000		49,078		252,179
2024 Notes		450,000		450,000		—		450,292
Total Debt	$	1,275,000	$	1,117,182	$	67,591	$	1,113,945

________________

(1)

The amount available reflects any limitations related to each credit facility’s borrow base.

(2)

For the three months ended March 31, 2022 and 2021, the components of interest expense were as follows:


	For the Three Months Ended March 31,
($ in thousands)	2022			2021
Interest expense	$	9,915		$	7,749
Amortization of debt issuance costs		342			771
Total Interest Expense	$	10,257		$	8,520
Average interest rate		3.5	%		3.4	%
Average daily borrowings	$	1,098,056		$	873,911

111

Senior Securities

Information about our senior securities is shown in the following table as of March 31, 2022 and the fiscal years ended December 31, 2021, 2020, 2019, 2018 and 2017.


Class and Period	Total Amount Outstanding Exclusive of Treasury Securities(1) ($ in millions)		Asset Coverage per Unit(2)		Involuntary Liquidating Preference per Unit(3)		Average Market Value per Unit(4)
Promissory Note(5)
December 31, 2020	$	—	$	—		—	N/A
December 31, 2019	$	—	$	2,687		—	N/A
December 31, 2018	$	—	$	2,397		—	N/A
December 31, 2017	$	—	$	4,969		—	N/A
SPV Asset Facility I
March 31, 2022 (unaudited)	$	467.2	$	2,241		—	N/A
December 31, 2021	$	412.2	$	2,213		—	N/A
December 31, 2020	$	365.1	$	2,416		—	N/A
December 31, 2019	$	265.7	$	2,687		—	N/A
December 31, 2018	$	302.5	$	2,397		—	N/A
December 31, 2017	$	20.0	$	4,969		—	N/A
SPV Asset Facility II
March 31, 2022 (unaudited)	$	155.0	$	2,241		—	N/A
December 31, 2021	$	255.0	$	2,213		—	N/A
December 31, 2020	$	191.0	$	2,416		—	N/A
2024 Notes
March 31, 2022 (unaudited)	$	450.0	$	2,241		—	N/A
December 31, 2021	$	450.0	$	2,213		—	N/A
December 31, 2020	$	350.0	$	2,416		—	N/A
December 31, 2019	$	300.0	$	2,687		—	N/A

________________

(1)

Total amount of each class of senior securities outstanding at the end of the period presented.

(2)

Asset coverage per unit is the ratio of the carrying value of our total assets, less all liabilities excluding indebtedness represented by senior securities in this table, to the aggregate amount of senior securities representing indebtedness. Asset coverage per unit is expressed in terms of dollar amounts per $1,000 of indebtedness and is calculated on a consolidated basis.

(3)

The amount to which such class of senior security would be entitled upon our involuntary liquidation in preference to any security junior to it. The "—" in this column indicates information that the SEC expressly does not require to be disclosed for certain types of senior securities.

(4)

Not applicable because the senior securities are not registered for public trading.

(5)

Promissory Note expired on December 31, 2020.

SPV Asset Facilities

Certain of our wholly owned subsidiaries are parties to credit facilities (the “SPV Asset Facilities”). Pursuant to the SPV Asset Facilities, we sell and contribute certain investments to these wholly owned subsidiaries pursuant to sale and contribution agreements by and between us and the wholly owned subsidiaries. No gain or loss is recognized as a result of these contributions. Proceeds from the SPV Asset Facilities are used to finance the origination and acquisition of eligible assets by the wholly owned subsidiary, including the purchase of such assets from us. We retain a residual interest in assets contributed to or acquired to the wholly owned subsidiary through our ownership of the wholly owned subsidiary.

The SPV Asset Facilities are secured by a perfected first priority security interest in the assets of these wholly owned subsidiaries and on any payments received by such wholly owned subsidiaries in respect of those assets. Assets pledged to lenders under the SPV Asset Facilities will not be available to pay our debts.

112

The SPV Asset Facilities contain customary covenants, including certain limitations on the incurrence by us of additional indebtedness and on our ability to make distributions to our shareholders, or redeem, repurchase or retire shares of stock, upon the occurrence of certain events, and customary events of default (with customary cure and notice provisions).

SPV Asset Facility I

On December 1, 2017 (the “SPV Asset Facility I Closing Date”), ORCC II Financing LLC and OR Lending II LLC (collectively, the “Subsidiaries”), each a Delaware limited liability company and a wholly-owned subsidiary of us, entered into a Credit Agreement (the “SPV Asset Facility I”). Parties to the SPV Asset Facility I include ORCC II Financing LLC and OR Lending II LLC, as Borrowers, and the lenders from time to time parties thereto (the “SPV I Lenders”), Goldman Sachs Bank USA as Sole Lead Arranger, Syndication Agent and Administrative Agent, State Street Bank and Trust Company as Collateral Administrator and Collateral Agent and Cortland Capital Market Services LLC as Collateral Custodian. From time to time, the parties to the SPV Asset Facility I have amended the SPV Asset Facility I and the related transaction documents.

From time to time, we sell and contribute certain investments to ORCC II Financing LLC pursuant to a Sale and Contribution Agreement by and between us and ORCC II Financing LLC. No gain or loss will be recognized as a result of these sales and contributions. Proceeds from the SPV Asset Facility I have been and will be used to finance the origination and acquisition of eligible assets by the Subsidiaries, including the purchase of such assets from us. We retain a residual interest in assets contributed to or acquired by the Subsidiaries through our ownership of the Subsidiaries. The maximum principal amount of the SPV Asset Facility I is $500 million; the availability of this amount is subject to a borrowing base test, which is based on the amount of the Subsidiaries’ assets from time to time, and satisfaction of certain conditions, including certain concentration limits

The SPV Asset Facility I provides for a reinvestment period up to and including November 30, 2022. (the “SPV Asset Facility I Commitment Termination Date”). Prior to the SPV Asset Facility I Commitment Termination Date, proceeds received by the Subsidiaries from interest, dividends, or fees on assets must be used to pay expenses and interest on outstanding borrowings, and the excess may be returned to the Company, subject to certain conditions. Proceeds received from principal on assets prior to the SPV Asset Facility I Commitment Termination Date must be used to make quarterly payments of principal on outstanding borrowings. Following the SPV Asset Facility I Commitment Termination Date, proceeds received by the Subsidiaries from interest and principal on collateral assets must be used to make quarterly payments of principal on outstanding borrowings. Subject to certain conditions, between quarterly payment dates prior to and after the SPV Asset Facility I Commitment Termination Date, excess interest proceeds and principal proceeds may be released to the Subsidiaries to make distributions to us.

The SPV Asset Facility I will mature on November 30, 2023. Amounts drawn bear interest at LIBOR plus a 2.25% spread and after a ramp-up period, the spread is also payable on any undrawn amounts. The Company borrows utilizing three-month LIBOR rate loans. If LIBOR ceases to exist, a waterfall of replacement rates will apply to SPV Asset Facility I, unless we , the Administrative Agent and the lenders negotiate a different replacement rate. The SPV Asset Facility I contains customary covenants, including certain financial maintenance covenants, limitations on the activities of the Subsidiaries, including limitations on incurrence of incremental indebtedness, and customary events of default. The SPV Asset Facility I is secured by a perfected first priority security interest in our equity interests in the Subsidiaries and in the assets of the Subsidiaries and on any payments received by the Subsidiaries in respect of those assets. Upon the occurrence of certain value adjustment events relating to the assets securing the SPV Asset Facility I, the Subsidiaries will also be required to provide certain cash collateral. Assets pledged to the SPV I Lenders will not be available to pay our debts.

Borrowings of the Subsidiaries are considered our borrowings for purposes of complying with the asset coverage requirements under the 1940 Act.

In connection with the SPV Asset Facility I, we entered into a Non-Recourse Carveout Guaranty Agreement on the SPV Asset Facility I Closing Date, which was amended and restated twice on March 11, 2019 and April 29, 2019, with State Street Bank and Trust Company, on behalf of certain secured parties, and Goldman Sachs Bank USA. Pursuant to the Non-Recourse Carveout Guaranty Agreement, we guarantee certain losses, damages, costs, expenses, liabilities, claims and other obligations incurred in connection with certain instances of fraud or bad faith misrepresentation, material encumbrances of certain collateral, misappropriation of certain funds, certain transfers of assets, and the bad faith or willful breach of certain provisions of the SPV Asset Facility I.

113

SPV Asset Facility II

On April 14, 2020 (the “SPV Asset Facility II Closing Date”), ORCC II Financing II LLC (“ORCC II Financing II”), a Delaware limited liability company and newly formed subsidiary of us entered into a Credit Agreement (the “SPV Asset Facility II”), with ORCC II Financing II, as Borrower, the lenders from time to time parties thereto (the “SPV II Lenders”), Natixis, New York Branch, as Administrative Agent, State Street Bank and Trust Company as Collateral Agent and Cortland Capital Market Services LLC as Document Custodian. The parties to the SPV Asset Facility II have entered into various amendments, including to increase the maximum principal amount of the SPV Asset Facility II, change the interest rates for amounts drawn in U.S. dollars, to extend the maturity of the SPV Asset Facility II to convert the benchmark rate of the facility from LIBOR to Term SOFR and make certain other changes. The summary below reflects the terms of the SPV Asset Facility II as amended through March 25, 2022.

From time to time, we expect to sell and contribute certain investments to ORCC II Financing II pursuant to a Sale and Contribution Agreement by and between us and ORCC II Financing II. No gain or loss will be recognized as a result of these sales and contributions. Proceeds from the SPV Asset Facility II will be used to finance the origination and acquisition of eligible assets by ORCC II Financing II, including the purchase of such assets from us. We retain a residual interest in assets contributed to or acquired by ORCC II Financing II through our ownership of ORCC II Financing II. The maximum principal amount of the SPV Asset Facility II is $325 million; the availability of this amount is subject to an overcollateralization ratio test, which is based on the value of ORCC II Financing II’s assets from time to time, and satisfaction of certain conditions, including an interest coverage ratio test, certain concentration limits and collateral quality tests.

The SPV Asset Facility II provides for the ability to (1) draw term loans and (2) draw and redraw revolving loans under the SPV Asset Facility II for a period of up to two years after the SPV Asset Facility II Closing Date unless the revolving commitments are terminated or converted to term loans sooner as provided in the SPV Asset Facility II (the “SPV Asset Facility II Commitment Termination Date”). Unless otherwise terminated, the SPV Asset Facility II will mature on April 14, 2030 (the “Stated Maturity”). Prior to the Stated Maturity, proceeds received by ORCC II Financing II from principal and interest, dividends, or fees on assets must be used to pay fees, expenses and interest on outstanding borrowings, and the excess may be returned to us, subject to certain conditions. On the Stated Maturity, ORCC II Financing II must pay in full all outstanding fees and expenses and all principal and interest on outstanding borrowings, and the excess may be returned to us.

Borrowings of ORCC II Financing II are considered our borrowings for purposes of complying with the asset coverage requirements under the 1940 Act.

114

Promissory Note

On May 18, 2017, our Board authorized us, as borrower, to enter into a series of promissory notes (the “Promissory Notes”) with our Adviser, as lender, to borrow up to an aggregate of $10 million from our Adviser. On October 19, 2017, our Board increased the approved amount to an aggregate of $15 million. On November 7, 2017, our Board approved a further modification to the Promissory Notes which extended the original maturity date from January 15, 2018 to December 31, 2018. On November 6, 2018, our Board approved an additional modification to the Promissory Notes which further extended the maturity date to December 31, 2019. On October 30, 2019, our Board approved an additional modification to the Promissory Notes which further extended the maturity date to December 31, 2020. On March 2, 2018, our Board increased the approved amount to an aggregate of $20 million. On July 19, 2018, our Board increased the approved amount to an aggregate of $35 million. On March 8, 2019, the Board increased the approved amount to an aggregate of $50 million. On October 30, 2019, the Board approved an additional modification to the Promissory Notes which further extended the maturity date to December 31, 2020. We may re-borrow any amount repaid; however, there is no funding commitment between the Adviser and us.

The unpaid principal balance of the Promissory Notes and accrued interest thereon was paid in full on December 15, 2020 and December 31, 2020, respectively. Borrowed funds were used to leverage our investment portfolio and to make investments in portfolio companies consistent with our investment strategies.

115

2024 Notes

On November 26, 2019, we issued $300 million aggregate principal amount of our 4.625% notes due November 26, 2024 (the “Existing 2024 Notes”) in a private placement in reliance on Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and for initial resale to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act.

On October 21, 2020, we issued an additional $50 million aggregate principal amount of our 4.625% notes due 2024 and on May 5, 2021, we issued an additional $100 million aggregate principal amount of our 4.625% notes due 2024 (collectively, the “Additional 2024 Notes” and together with the Existing 2024 Notes, the “2024 Notes”) in a private placement in reliance on Section 4(a)(2) of the Securities Act, and for initial resale to qualified institutional buyers pursuant to the exemption from registration provided by Rule 144A promulgated under the Securities Act. The Additional 2024 Notes will be treated as a single series with the Existing 2024 Notes and will have the same terms as the Existing 2024 Notes.

The 2024 Notes have not been registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration.

The 2024 Notes were issued pursuant to an Indenture dated as of November 26, 2019 (the “Base Indenture”), between us and Wells Fargo Bank, National Association, as trustee (the “Trustee”), and a First Supplemental Indenture, dated as of November 26, 2019 (the “First Supplemental Indenture” and together with the Base Indenture, the “Indenture”), between us and the Trustee. The 2024 Notes will mature on November 26, 2024, unless repurchased or redeemed in accordance with their terms prior to such date. The 2024 Notes bear interest at a rate of 4.625% per year payable semi-annually on May 26 and November 26 of each year, commencing on May 26, 2020. The 2024 Notes will be our direct, general unsecured obligations and will rank senior in right of payment to all of our future indebtedness or other obligations that are expressly subordinated, or junior, in right of payment to the 2024 Notes. The 2024 Notes will rank pari passu, or equal, in right of payment with all of our existing and future indebtedness or other obligations that are not so subordinated. The 2024 Notes will rank effectively subordinated, or junior, to any of our future secured indebtedness or other obligations (including unsecured indebtedness that we later secure) to the extent of the value of the assets securing such indebtedness. The 2024 Notes will rank structurally subordinated, or junior, to all existing and future indebtedness and other obligations (including trade payables) incurred by our subsidiaries, financing vehicles or similar facilities.

The Indenture contains certain covenants, including covenants requiring us to (i) comply with the asset coverage requirements of the Investment Company Act of 1940, as amended, whether or not it is subject to those requirements, and (ii) provide financial information to the holders of the 2024 Notes and the Trustee if we are no longer subject to the reporting requirements under the Securities Exchange Act of 1934, as amended. These covenants are subject to important limitations and exceptions that are described in the Indenture.

In addition, if a change of control repurchase event, as defined in the Indenture, occurs prior to maturity, holders of the 2024 Notes will have the right, at their option, to require us to repurchase for cash some or all of the 2024 Notes at a repurchase price equal to 100% of the aggregate principal amount of the 2024 Notes being repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.

116

Off-Balance Sheet Arrangements

Portfolio Company Commitments

From time to time, we may enter into commitments to fund investments. As of March 31, 2022 and December 31, 2021, we had the following outstanding commitments to fund investments in current portfolio companies:


Portfolio Company	Investment	March 31, 2022	December 31, 2021
($ in thousands)
3ES Innovation Inc. (dba Aucerna)	First lien senior secured revolving loan	$687	$687
ABB/Con-cise Optical Group LLC	First lien senior secured revolving loan	59	—
Alera Group, Inc.	First lien senior secured delayed draw term loan	94	94
AmSpec Group, Inc. (fka AmSpec Services Inc.)	First lien senior secured revolving loan	2,462	1,815
Apex Group Treasury, LLC	Second lien senior secured delayed draw term loan	6,618	6,618
Apptio, Inc.	First lien senior secured revolving loan	294	294
Aramsco, Inc.	First lien senior secured revolving loan	336	1,043
Ardonagh Midco 3 PLC	First lien senior secured GBP delayed draw term loan	577	593
Ascend Buyer, LLC (dba PPC Flexible Packaging)	First lien senior secured revolving loan	65	65
Associations, Inc.	First lien senior secured revolving loan	6,146	6,146
AxiomSL Group, Inc.	First lien senior secured delayed draw term loan	2,276	2,276
AxiomSL Group, Inc.	First lien senior secured revolving loan	3,496	3,496
Bayshore Intermediate #2, L.P. (dba Boomi)	First lien senior secured revolving loan	1,239	1,239
BCPE Osprey Buyer, Inc. (dba PartsSource)	First lien senior secured delayed draw term loan	345	345
BCPE Osprey Buyer, Inc. (dba PartsSource)	First lien senior secured revolving loan	52	52
BCTO BSI Buyer, Inc. (dba Buildertrend)	First lien senior secured revolving loan	444	444
BP Veraison Buyer, LLC (dba Sun World)	First lien senior secured delayed draw term loan	6,081	6,081
BP Veraison Buyer, LLC (dba Sun World)	First lien senior secured revolving loan	1,824	1,824

117


Portfolio Company	Investment	March 31, 2022	December 31, 2021
Brightway Holdings, LLC	First lien senior secured revolving loan	526	526
Centrify Corporation	First lien senior secured revolving loan	1,345	1,345
CivicPlus, LLC	First lien senior secured revolving loan	59	59
CivicPlus, LLC	First lien senior secured delayed draw term loan	293	293
CSC Mkg Topco LLC (dba Medical Knowledge Group)	First lien senior secured revolving loan	112	—
Denali BuyerCo, LLC (dba Summit Companies)	First lien senior secured delayed draw term loan	347	513
Denali BuyerCo, LLC (dba Summit Companies)	First lien senior secured revolving loan	92	185
Diamondback Acquisition, Inc. (dba Sphera)	First lien senior secured delayed draw term loan	166	166
Dodge Data & Analytics LLC	First lien senior secured revolving loan	—	374
Douglas Products and Packaging Company LLC	First lien senior secured revolving loan	1,815	661
EET Buyer, Inc. (dba e-Emphasys)	First lien senior secured revolving loan	91	91
Entertainment Benefits Group, LLC	First lien senior secured revolving loan	2,800	2,800
Evolution BuyerCo, Inc. (dba SIAA)	First lien senior secured revolving loan	2,230	2,230
Forescout Technologies, Inc.	First lien senior secured revolving loan	700	700
Fortis Solutions Group, LLC	First lien senior secured delayed draw term loan	262	262
Fortis Solutions Group, LLC	First lien senior secured revolving loan	90	90
Gainsight, Inc.	First lien senior secured revolving loan	872	872
Galls, LLC	First lien senior secured revolving loan	2,361	3,336
Gaylord Chemical Company, L.L.C.	First lien senior secured revolving loan	2,609	2,609
Gerson Lehrman Group, Inc.	First lien senior secured revolving loan	2,039	2,039
GI Ranger Intermediate, LLC (dba Rectangle Health)	First lien senior secured delayed draw term loan	—	123
GI Ranger Intermediate, LLC (dba Rectangle Health)	First lien senior secured revolving loan	66	74
Global Music Rights, LLC	First lien senior secured revolving loan	83	83
GovBrands Intermediate, Inc.	First lien senior secured delayed draw term loan	259	259
GovBrands Intermediate, Inc.	First lien senior secured revolving loan	185	185
Guidehouse Inc.	First lien senior secured revolving loan	—	70
H&F Opportunities LUX III S.À R.L (dba Checkmarx)	First lien senior secured revolving loan	4,583	4,583
Hercules Borrower, LLC (dba The Vincit Group)	First lien senior secured revolving loan	2,986	3,343

118


Portfolio Company	Investment	March 31, 2022	December 31, 2021
HGH Purchaser, Inc. (dba Horizon Services)	First lien senior secured delayed draw term loan	7,949	7,949
HGH Purchaser, Inc. (dba Horizon Services)	First lien senior secured revolving loan	866	1,758
Hometown Food Company	First lien senior secured revolving loan	471	471
Ideal Tridon Holdings, Inc.	First lien senior secured revolving loan	1,273	872
IG Investments Holdings, LLC (dba Insight Global)	First lien senior secured revolving loan	578	361
Individual Foodservice Holdings, LLC	First lien senior secured delayed draw term loan	—	1,440
Individual Foodservice Holdings, LLC	First lien senior secured revolving loan	3,724	4,328
Innovation Ventures HoldCo, LLC	First lien senior secured delayed draw term loan	400	—
Inovalon Holdings, Inc.	First lien senior secured delayed draw term loan	4,499	4,499
Integrity Marketing Acquisition, LLC	First lien senior secured revolving loan	1,868	1,868
Intelerad Medical Systems Incorporated (fka 11849573 Canada Inc.)	First lien senior secured revolving loan	536	536
Interoperability Bidco, Inc. (dba Lyniate)	First lien senior secured revolving loan	652	1,000
IQN Holding Corp. (dba Beeline)	First lien senior secured revolving loan	2,612	2,612
KPSKY Acquisition, Inc. (dba BluSky)	First lien senior secured delayed draw term loan	51	51
Lazer Spot G B Holdings, Inc.	First lien senior secured revolving loan	7,089	7,542
Lignetics Investment Corp.	First lien senior secured delayed draw term loan	1,225	1,225
Lignetics Investment Corp.	First lien senior secured revolving loan	1,054	1,225
Litera Bidco LLC	First lien senior secured delayed draw term loan	913	913
Litera Bidco LLC	First lien senior secured revolving loan	1,013	1,013
MHE Intermediate Holdings, LLC (dba OnPoint Group)	First lien senior secured delayed draw term loan	1,132	1,132
MHE Intermediate Holdings, LLC (dba OnPoint Group)	First lien senior secured revolving loan	1,715	1,786
Milan Laser Holdings LLC	First lien senior secured revolving loan	1,961	1,961
MINDBODY, Inc.	First lien senior secured revolving loan	1,071	1,071
Ministry Brands Holdings, LLC	First lien senior secured delayed draw term loan	226	226
Ministry Brands Holdings, LLC	First lien senior secured revolving loan	68	68
National Dentex Labs LLC (fka Barracuda Dental LLC)	First lien senior secured delayed draw term loan	730	730
National Dentex Labs LLC (fka Barracuda Dental LLC)	First lien senior secured revolving loan	472	1,159
Natural Partners, LLC	First lien senior secured revolving loan	68	—

119


Portfolio Company	Investment	March 31, 2022	December 31, 2021
Nelipak Holding Company	First lien senior secured revolving loan	512	512
Nelipak Holding Company	First lien senior secured revolving loan	878	897
NMI Acquisitionco, Inc. (dba Network Merchants)	First lien senior secured delayed draw term loan	538	538
NMI Acquisitionco, Inc. (dba Network Merchants)	First lien senior secured revolving loan	218	218
Norvax, LLC (dba GoHealth)	First lien senior secured revolving loan	614	614
Notorious Topco, LLC (dba Beauty Industry Group)	First lien senior secured delayed draw term loan	3,521	3,521
Notorious Topco, LLC (dba Beauty Industry Group)	First lien senior secured revolving loan	1,549	1,761
OB Hospitalist Group, Inc.	First lien senior secured revolving loan	2,931	2,618
Patriot Acquisition TopCo S.A.R.L (dba Corza Health, Inc.)	First lien senior secured revolving loan	2,654	2,654
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)	First lien senior secured delayed draw term loan	—	1,460
Peter C. Foy & Associates Insurance Services, LLC (dba PCF Insurance Services)	First lien senior secured revolving loan	1,035	1,035
Pluralsight, LLC	First lien senior secured revolving loan	1,294	1,295
Project Power Buyer, LLC (dba PEC-Veriforce)	First lien senior secured revolving loan	563	563
QAD, Inc.	First lien senior secured revolving loan	571	571
Quva Pharma, Inc.	First lien senior secured revolving loan	851	1,182
Reef Global Acquisition LLC (fka Cheese Acquisition, LLC)	First lien senior secured revolving loan	877	747
Refresh Parent Holdings, Inc.	First lien senior secured delayed draw term loan	—	106
Refresh Parent Holdings, Inc.	First lien senior secured revolving loan	—	920
Relativity ODA LLC	First lien senior secured revolving loan	1,480	1,480
Sara Lee Frozen Bakery, LLC (fka KSLB Holdings, LLC)	First lien senior secured revolving loan	773	967
The Shade Store, LLC	First lien senior secured revolving loan	114	227
Smarsh Inc.	First lien senior secured delayed draw term loan	190	—
Smarsh Inc.	First lien senior secured revolving loan	48	—
Sonny's Enterprises LLC	First lien senior secured revolving loan	2,630	2,254
Swipe Acquisition Corporation (dba PLI)	First lien senior secured delayed draw term loan	772	1,269
Swipe Acquisition Corporation (dba PLI)	Letter of Credit	882	882
SWK Buyer, Inc. (dba Stonewall Kitchen)	First lien senior secured delayed draw term loan	175	—
SWK Buyer, Inc. (dba Stonewall Kitchen)	First lien senior secured revolving loan	63	—

120


Portfolio Company	Investment	March 31, 2022	December 31, 2021
Tahoe Finco, LLC	First lien senior secured revolving loan	1,744	1,744
Tamarack Intermediate, L.L.C.	First lien senior secured revolving loan	112	—
TC Holdings, LLC (dba TrialCard)	First lien senior secured revolving loan	3,315	3,315
TEMPO BUYER CORP. (dba Global Claims Services)	First lien senior secured delayed draw term loan	198	198
TEMPO BUYER CORP. (dba Global Claims Services)	First lien senior secured revolving loan	95	99
THG Acquisition, LLC (dba Hilb)	First lien senior secured revolving loan	1,871	1,871
Thunder Purchaser, Inc. (dba Vector Solutions)	First lien senior secured delayed draw term loan	2,349	2,348
Thunder Purchaser, Inc. (dba Vector Solutions)	First lien senior secured revolving loan	681	822
Troon Golf, L.L.C.	First lien senior secured revolving loan	3,806	4,685
Ultimate Baked Goods Midco, LLC	First lien senior secured revolving loan	750	950
USRP Holdings, Inc. (dba U.S. Retirement and Benefits Partners)	First lien senior secured revolving loan	180	180
Valence Surface Technologies LLC	First lien senior secured revolving loan	12	12
Velocity HoldCo III Inc. (dba VelocityEHS)	First lien senior secured revolving loan	368	368
When I Work, Inc.	First lien senior secured revolving loan	143	143
WU Holdco, Inc. (dba Weiman Products, LLC)	First lien senior secured delayed draw term loan	—	1,023
WU Holdco, Inc. (dba Weiman Products, LLC)	First lien senior secured revolving loan	3,169	2,465
Total Unfunded Portfolio Company Commitments		$148,808	$157,293

We seek to carefully consider our unfunded portfolio company commitments for the purpose of planning our ongoing financial leverage. Further, we consider any outstanding unfunded portfolio company commitments we are required to fund within the 200% asset coverage limitation. As of March 31, 2022, we believe we had adequate financial resources to satisfy the unfunded portfolio company commitments.

Organizational and Offering Costs

The Adviser has incurred organization and offering costs on behalf of us in the amount of $12.4 million for the period from October 15, 2015 (Inception) to March 31, 2022, of which $12.4 million has been charged to us pursuant to the Investment Advisory Agreement. The Adviser did not incur any organization or offering costs on behalf of us for the three months ended March 31, 2022. Under the Investment Advisory Agreement and Administration Agreement, the Adviser is entitled to receive up to 1.5% of gross offering proceeds raised in our continuous public offering until all organization and offering costs paid by the Adviser have been recovered.

The Adviser has incurred organization and offering costs on behalf of us in the amount of $12.4 million for the period from October 15, 2015 (Inception) to December 31, 2021, of which $12.4 million has been charged to us pursuant to the Investment Advisory Agreement.

Other Commitments and Contingencies

From time to time, we may become a party to certain legal proceedings incidental to the normal course of our business. As of March 31, 2022, we were not aware of any material pending or threatened litigation that would require accounting recognition or financial statement disclosure.

121

Contractual Obligations

A summary of our contractual payment obligations under our SPV Asset Facility I, SPV Asset Facility II and 2024 Notes as of March 31, 2022, is as follows:


	Payments Due by Period
($ in thousands)	Total		Less than 1 year		1-3 years		3-5 years		After 5 years
SPV Asset Facility I	$	467,227	$	—	$	467,227	$	—	$	—
SPV Asset Facility II		155,000		—		—		—		155,000
2024 Notes		450,000		—		450,000		—		—
Total Contractual Obligations	$	1,072,227	$	—	$	917,227	$	—	$	155,000

Related Party Transactions

We have entered into a number of business relationships with affiliated or related parties, including the following:

•

the Investment Advisory Agreement;

•

the Administration Agreement;

•

the Expense Support Agreement;

•

the Dealer Manager Agreement; and

•

the License Agreement.

In addition to the aforementioned agreements, we, our Adviser and certain of our Adviser’s affiliates have been granted exemptive relief by the SEC to permit us to co-invest with other funds managed by the Adviser or its affiliates in a manner consistent with our investment objective, positions, policies, strategies and restrictions as well as regulatory requirements and other pertinent factors. See “ITEM 1. – Notes to Consolidated Financial Statements – Note 3. Agreements and Related Party Transactions” for further details.

Our Board has authorized us to enter into a series of Promissory Notes with our Adviser to borrow up to $50 million. The Promissory Notes matured on December 31, 2020. See “ITEM 1. – Notes to Consolidated Financial Statements – Note. 6 Debt” for further details.

Critical Accounting Policies

The preparation of the consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. Changes in the economic environment, financial markets, and any other parameters used in determining such estimates could cause actual results to differ. Our critical accounting policies should be read in connection with our risk factors as disclosed in our Form 10-K for the fiscal year ended December 31, 2021 and in “ITEM 1A. – RISK FACTORS.”

Investments at Fair Value

Investment transactions are recorded on the trade date. Realized gains or losses are measured by the difference between the net proceeds received (excluding prepayment fees, if any) and the amortized cost basis of the investment using the specific identification method without regard to unrealized gains or losses previously recognized, and include investments charged off during the period, net of recoveries. The net change in unrealized gains or losses primarily reflects the change in investment values, including the reversal of previously recorded unrealized gains or losses with respect to investments realized during the period.

Investments for which market quotations are readily available are typically valued at the bid price of those market quotations. To validate market quotations, we utilize a number of factors to determine if the quotations are representative of fair value, including the source and number of the quotations. Debt and equity securities that are not publicly traded or whose market prices are not readily available, as is the case for substantially all of our investments, are valued at fair value as determined in good faith by our Board, based on, among other things, the input of the Adviser, our audit committee and independent third-party valuation firm(s) engaged at the direction of the Board.

122

As part of the valuation process, the Board takes into account relevant factors in determining the fair value of our investments, including: the estimated enterprise value of a portfolio company (i.e., the total fair value of the portfolio company’s debt and equity), the nature and realizable value of any collateral, the portfolio company’s ability to make payments based on its earnings and cash flow, the markets in which the portfolio company does business, a comparison of the portfolio company’s securities to any similar publicly traded securities, and overall changes in the interest rate environment and the credit markets that may affect the price at which similar investments may be made in the future. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the Board considers whether the pricing indicated by the external event corroborates its valuation.

The Board undertakes a multi-step valuation process, which includes, among other procedures, the following:

•

With respect to investments for which market quotations are readily available, those investments will typically be valued at the bid price of those market quotations;

•

Preliminary valuation conclusions are documented and discussed with the Adviser’s valuation committee. Agreed upon valuation recommendations are presented to the Audit Committee;

•

The Audit Committee reviews the valuation recommendations and recommends values for each investment to the Board; and

•

The Board reviews the recommended valuations and determines the fair value of each investment.

We conduct this valuation process on a quarterly basis.

We apply Financial Accounting Standards Board Accounting Standards Codification 820, Fair Value Measurements (“ASC 820”), as amended, which establishes a framework for measuring fair value in accordance with U.S. GAAP and required disclosures of fair value measurements. ASC 820 determines fair value to be the price that would be received for an investment in a current sale, which assumes an orderly transaction between market participants on the measurement date. Market participants are defined as buyers and sellers in the principal or most advantageous market (which may be a hypothetical market) that are independent, knowledgeable, and willing and able to transact. In accordance with ASC 820, we consider its principal market to be the market that has the greatest volume and level of activity. ASC 820 specifies a fair value hierarchy that prioritizes and ranks the level of observability of inputs used in determination of fair value. In accordance with ASC 820, these levels are summarized below:

•

Level 1 – Valuations based on quoted prices in active markets for identical assets or liabilities that we have the ability to access.

•

Level 2 – Valuations based on quoted prices in markets that are not active or for which all significant inputs are observable, either directly or indirectly.

•

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

Transfers between levels, if any, are recognized at the beginning of the period in which the transfer occurred. In addition to using the above inputs in investment valuations, we apply the valuation policy approved by our Board that is consistent with ASC 820. Consistent with the valuation policy, we evaluate the source of the inputs, including any markets in which our investments are trading (or any markets in which securities with similar attributes are trading), in determining fair value. When an investment is valued based on prices provided by reputable dealers or pricing services (that is, broker quotes), we subject those prices to various criteria in making the determination as to whether a particular investment would qualify for treatment as a Level 2 or Level 3 investment. For example, we, or the independent valuation firm(s), review pricing support provided by dealers or pricing services in order to determine if observable market information is being used, versus unobservable inputs.

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 our investments may fluctuate from period to period. Additionally, the fair value of such 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 may ultimately be realized. Further, such investments are generally less liquid than publicly traded securities and may be subject to contractual and other restrictions on resale. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we could realize amounts that are different from the amounts presented and such differences could be material.

123

Interest and Dividend Income Recognition

Interest income is recorded on the accrual basis and includes amortization of discounts or premiums. Certain investments may have contractual payment-in-kind (“PIK”) interest or dividends. PIK interest or dividends represent accrued interest or dividends that are added to the principal amount or liquidation amount of the investment on the respective interest or dividend payment dates rather than being paid in cash and generally becomes due at maturity or at the occurrence of a liquidation event. Discounts and premiums to par value on securities purchased are amortized into interest income over the contractual life of the respective security using the effective yield method. The amortized cost of investments represents the original cost adjusted for the amortization of discounts or premiums, if any. Upon prepayment of a loan or debt security, any prepayment premiums, unamortized upfront loan origination fees and unamortized discounts are recorded as interest income in the current period.

Loans are generally placed on non-accrual status when there is reasonable doubt that principal or interest will be collected in full. Accrued interest is generally reversed when a 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 regarding collectability. If at any point we believe PIK interest or dividends are not expected to be realized, the investment generating PIK interest or dividends will be placed on non-accrual status. When a PIK investment is placed on non-accrual status, the accrued, uncapitalized interest or dividends are generally reversed through interest income. Non-accrual loans are restored to accrual status when past due principal and interest is paid current and, in management’s judgment, are likely to remain current. Management may make exceptions to this treatment and determine to not place a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection.

Distributions

We have elected to be treated for U.S. federal income tax purposes, and intend to qualify annually, as a RIC under Subchapter M of the Code. To obtain and maintain our tax treatment as a RIC, we must distribute (or be deemed to distribute) in each taxable year distributions for tax purposes equal to at least 90 percent of the sum of our:

•

investment company taxable income (which is generally our ordinary income plus the excess of realized short-term capital gains over realized net long-term capital losses), determined without regard to the deduction for dividends paid, for such taxable year; and

•

net tax-exempt interest income (which is the excess of our gross tax exempt interest income over certain disallowed deductions) for such taxable year.

As a RIC, we (but not our shareholders) generally will not be subject to U.S. federal tax on investment company taxable income and net capital gains that we distribute to our shareholders.

We intend to distribute annually all or substantially all of such income. To the extent that we retain our net capital gains or any investment company taxable income, we generally will be subject to corporate-level U.S. federal income tax. We can be expected to carry forward our net capital gains or any investment company taxable income in excess of current year dividend distributions and pay the U.S. federal excise tax as described below.

Amounts not distributed on a timely basis in accordance with a calendar year distribution requirement are subject to a nondeductible 4% U.S. federal excise tax payable by us. We may be subject to a nondeductible 4% U.S. federal excise tax if we do not distribute (or are treated as distributing) during each calendar year an amount at least equal to the sum of:

•

98% of our net ordinary income excluding certain ordinary gains or losses for that calendar year;

•

98.2% of our capital gain net income, adjusted for certain ordinary gains and losses, recognized for the twelve-month period ending on October 31 of that calendar year; and

•

100% of any income or gains recognized, but not distributed, in preceding years.

124

While we intend to distribute any income and capital gains in the manner necessary to minimize imposition of the 4% U.S. federal excise tax, sufficient amounts of our taxable income and capital gains may not be distributed and as a result, in such cases, the excise tax will be imposed. In such an event, we will be liable for this tax only on the amount by which we do not meet the foregoing distribution requirement.

We intend to pay monthly distributions to our shareholders out of assets legally available for distribution. All distributions will be paid at the discretion of our Board and will depend on our earnings, financial condition, maintenance of our tax treatment as a RIC, compliance with applicable BDC regulations and such other factors as our Board may deem relevant from time to time.

To the extent our current taxable earnings for a year fall below the total amount of our distributions for that year, a portion of those distributions may be deemed a return of capital to our shareholders for U.S. federal income tax purposes. Thus, the source of a distribution to our shareholders may be the original capital invested by the shareholder rather than our income or gains. Shareholders should read written disclosure carefully and should not assume that the source of any distribution is our ordinary income or gains.

With respect to distributions, the Company has adopted an “opt-in” dividend reinvestment plan for common shareholders. As a result, in the event of a declared distribution, each shareholder that has not “opted-in” to the dividend reinvestment plan will have their dividends or distributions automatically received in cash rather than reinvested in additional shares of our common stock. Shareholders who receive distributions in the form of shares of common stock will be subject to the same U.S. federal, state and local tax consequences as if they received cash distributions.

Income Taxes

We have elected to be treated as a BDC under the 1940 Act. We have also elected to be treated as a RIC under the Code beginning with our taxable year ended December 31, 2017 and intend to continue to qualify for tax treatment as a RIC. So long as we maintain our tax treatment as a RIC, we generally will not pay corporate-level U.S. federal income taxes on any ordinary income or capital gains that we distribute at least annually to our shareholders as distributions. Rather, any tax liability related to income earned and distributed by us represents obligations of our investors and will not be reflected in our consolidated financial statements.

To qualify as a RIC, we must, among other things, meet certain source-of-income and asset diversification requirements. In addition, to qualify for RIC tax treatment, we must distribute to our shareholders, for each taxable year, at least 90% of our “investment company taxable income” for that year, which is generally our ordinary income plus the excess of our realized net short-term capital gains over our realized net long-term capital losses. In order for us to not be subject to U.S. federal excise taxes, we must distribute annually an amount at least equal to the sum of (i) 98% of our net ordinary income (taking into account certain deferrals and elections) for the calendar year, (ii) 98.2% of our capital gains in excess of capital losses for the one-year period ending on October 31 of the calendar year and (iii) any net ordinary income and capital gains in excess of capital losses for preceding years that were not distributed during such years. We, at our discretion, may carry forward taxable income in excess of calendar year dividends and pay a 4% nondeductible U.S. excise tax on this income.

Certain of our consolidated subsidiaries are subject to U.S. federal and state corporate-level income taxes.

We evaluate tax positions taken or expected to be taken in the course of preparing our consolidated financial statements to determine whether the tax positions are “more-likely-than-not” to be sustained by the applicable tax authority. Tax positions not deemed to meet the “more-likely-than-not” threshold are reserved and recorded as a tax benefit or expense in the current year. All penalties and interest associated with income taxes are included in income tax expense. Conclusions regarding tax positions are subject to review and may be adjusted at a later date based on factors including, but not limited to, on-going analyses of tax laws, regulations and interpretations thereof. There were no material uncertain tax positions through December 31, 2021. The 2018 through 2020 tax years remain subject to examination by the IRS, and generally years 2017 through 2020 remain subject to examination by state and local tax authorities.

125

Recent Developments

On May 3, 2022, our Board declared regular monthly distributions for July 2022 through September 2022. The regular monthly cash distributions, each in the gross amount of $0.050180 per share, will be payable monthly to shareholders of record as of the monthly record date.

On May 3, 2022, our Board declared a regular quarterly distribution payable on or before August 15, 2022 to shareholders of record as of June 30, 2022, equal to 100% of the Company's investment company taxable income and net capital gains for the taxable quarter, to the extent such amount exceeds $0.15054 per share, but is less than or equal to $0.167271 per share.

126

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

We are subject to financial market risks, including valuation risk and interest rate risk.

Valuation Risk

We have invested, and plan to continue to invest, primarily in illiquid debt and equity securities of private companies. Most of our investments will not have a readily available market price, and we value these investments at fair value as determined in good faith by our Board, based on, among other things, the input of the Adviser, our Audit Committee and independent third-party valuation firm(s) engaged at the direction of the Board, and in accordance with our valuation policy. There is no single standard for determining fair value. As a result, determining fair value requires that judgment be applied to the specific facts and circumstances of each portfolio investment while employing a consistently applied valuation process for the types of investments we make. If we were required to liquidate a portfolio investment in a forced or liquidation sale, we may realize amounts that are different from the amounts presented and such differences could be material.

Interest Rate Risk

Interest rate sensitivity refers to the change in earnings that may result from changes in the level of interest rates. We intend to fund portions of our investments with borrowings, and at such time, our net investment income will be affected by the difference between the rate at which we invest and the rate at which we borrow. Accordingly, we cannot assure you that a significant change in market interest rates will not have a material adverse effect on our net investment income.

In a prolonged low interest rate environment, the difference between the total interest income earned on interest earning assets and the total interest expense incurred on interest bearing liabilities may be compressed, reducing our net income and potentially adversely affecting our operating results. Conversely, in a rising interest rate environment, such difference could potentially increase thereby increasing our net income as indicated per the table below.

Substantially all of our assets and liabilities are financial in nature. As a result, changes in interest rates and other factors drive our performance more directly than does inflation. Changes in interest rates do not necessarily correlate with inflation rates or changes in inflation rates.

As of March 31, 2022, 99.0% of our debt investments based on fair value in our portfolio were at floating rates. Additionally, the weighted average LIBOR floor, based on fair value, of our debt investments was 0.8%.

Based on our Consolidated Statements of Assets and Liabilities as of March 31, 2022, the following table shows the annualized impact on net income of hypothetical base rate changes in interest rates on our debt investments (considering interest rate floors for floating rate instruments) assuming each floating rate investment is subject to 3 month LIBOR and there are no changes in our investment and borrowing structure.


($ in millions)	Interest Income			Interest Expense			Net Income
Up 300 basis points	$	67.9		$	18.7		$	49.2
Up 200 basis points	$	45.1		$	12.4		$	32.7
Up 100 basis points	$	22.2		$	6.2		$	16.0
Up 50 basis points	$	10.8		$	3.1		$	7.7
Down 50 basis points	$	(2.6	)	$	(3.1	)	$	0.5
Down 100 basis points	$	(3.3	)	$	(6.0	)	$	2.7

We may in the future hedge against interest rate fluctuations by using hedging instruments such as additional interest rate swaps, futures, options, and forward contracts. While hedging activities may mitigate our exposure to adverse fluctuations in interest rates, certain hedging transactions that we may enter into in the future, such as interest rate swap agreements, may also limit our ability to participate in the benefits of lower interest rates with respect to our portfolio investments.

127

Currency Risk

From time to time, we may make investments that are denominated in a foreign currency. These investments are translated into U.S. dollars at each balance sheet date, exposing us to movements in foreign exchange rates. We may employ hedging techniques to minimize these risks, but we cannot assure you that such strategies will be effective or without risk to us. We may seek to utilize instruments such as, but not limited to, forward contracts to seek to hedge against fluctuations in the relative values of our portfolio positions from changes in currency exchange rates. We also have the ability to borrow in certain foreign currencies under our credit facilities. Instead of entering into a foreign currency forward contract in connection with loans or other investments we have made that are denominated in a foreign currency, we may borrow in that currency to establish a natural hedge against our loan or investment. To the extent the loan or investment is based on a floating rate other than a rate under which we can borrow under our credit facilities, we may seek to utilize interest rate derivatives to hedge our exposure to changes in the associated rate.

128

Item 4. Controls and Procedures

(a)

Evaluation of Disclosure Controls and Procedures

In accordance with Rules 13a-15(b) and 15d-15(b) of the Securities Exchange Act of 1934 ("Exchange Act"), as amended, we, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q and determined that our disclosure controls and procedures are effective as of the end of the period covered by the Quarterly Report on Form 10-Q.

(b)

Changes in Internal Controls Over Financial Reporting

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended March 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

129

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

We are not currently subject to any material legal proceedings, nor, to our knowledge, are any material legal proceeding threatened against us. From time to time, we may be a party to certain legal proceedings in the ordinary course of business, including proceedings relating to the enforcement of our rights under contracts with our portfolio companies. Our business is also subject to extensive regulation, which may result in regulatory proceedings against us. While the outcome of any such future legal or regulatory proceedings cannot be predicted with certainty, we do not expect that any such future proceedings will have a material effect upon our financial condition or results of operations.

Item 1A. Risk Factors.

In addition to the other information set forth in this report, you should carefully consider the risk factors discussed in Part I, “ITEM 1A. RISK FACTORS” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021, which could materiality affect our business, financial condition and/or operating results. The risks described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.

Global economic, political and market conditions, including uncertainty about the financial stability of the United States, could have a significant adverse effect on our business, financial condition and results of operations.

The current worldwide financial markets situation, as well as various social and political tensions in the United States and around the world (including wars and other forms of conflict, terrorist acts, security operations and catastrophic events such as fires, floods, earthquakes, tornadoes, hurricanes and global health epidemics), may contribute to increased market volatility, may have long term effects on the United States and worldwide financial markets, and may cause economic uncertainties or deterioration in the United States and worldwide.

For example, the COVID-19 pandemic continues to adversely impact global commercial activity and has contributed to significant volatility in financial markets.

In addition, the rising conflict between Russia and Ukraine, and resulting market volatility, could adversely affect our business, financial condition or results of operations. In response to the conflict between Russia and Ukraine, the U.S. and other countries have imposed sanctions or other restrictive actions against Russia. The ongoing conflict and the rapidly evolving measures in response could be expected to have a negative impact on the economy and business activity globally and could have a material adverse effect on our portfolio companies and our business, financial condition, cash flows and results of operations. The severity and duration of the conflict and its impact on global economic and market conditions are impossible to predict. In addition, sanctions could also result in Russia taking counter measures or retaliatory actions which could adversely impact our business or the business of our portfolio companies, including, but not limited to, cyberattacks targeting private companies, individuals or other infrastructure upon which our business and the business of our portfolio companies rely.

Any of the above factors, including sanctions, export controls, tariffs, trade wars and other governmental actions, could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline. We monitor developments and seek to manage our investments in a manner consistent with achieving our investment objective, but there can be no assurance that we will be successful in doing so.

130

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

In order to satisfy the reinvestment portion of our dividends for the three months ended March 31, 2022, we issued the following shares of common stock to stockholders of record on the dates noted below who did not opt out of our dividend reinvestment plan. These issuances were not subject to the registration requirements of the Securities Act of 1933, as amended.


Date of Issuance	Record Date	Number of Shares		Purchase Price per Share
January 26, 2022	January 25, 2022		389,571	$	8.98
February 23, 2022	February 22, 2022		390,759	$	8.98
March 30, 2022	March 29, 2022		391,196	$	8.88

All shares purchased by us pursuant to the terms of each offer to repurchase will be retired and thereafter will be authorized and unissued shares.


Offer Date	Tender Offer Expiration	Tender Offer		Purchase Price per Share		Shares Repurchased
March 4, 2019	March 29, 2019	$	6,207,452	$	9.06		119,874
May 13, 2019	June 10, 2019	$	9,039,928	$	9.07		100,108
August 19, 2019	September 16, 2019	$	13,085,063	$	9.08		234,693
November 18, 2019	December 16, 2019	$	16,984,077	$	9.02		396,914
March 9, 2020	April 3, 2020	$	21,398,616	$	8.30		1,462,441
May 26, 2020	June 22, 2020	$	16,280,933	$	8.60		600,204
August 24, 2020	September 21, 2020	$	21,493,631	$	8.78		1,797,979
November 16, 2020	December 14, 2020	$	16,153,577	$	8.78		794,091
March 10, 2021	April 6, 2021	$	18,995,153	$	8.95		1,945,553
June 1, 2021	June 28, 2021	$	19,621,539	$	8.99		2,182,596
August 30, 2021	September 27, 2021	$	11,911,588	$	9.00		1,323,510
November 29, 2021	December 27, 2021	$	11,859,682	$	9.00		1,317,742
March 1, 2022	March 28, 2022	$	15,362,486	$	8.88		1,730,010

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

131

Item 5. Other Information.

Executive Officers

On May 3, 2022, the Board appointed Jennifer McMillon to serve as the Company's Co-Chief Accounting Officer, Co-Treasurer and Co-Controller.

Ms. McMillon is a Managing Director of Blue Owl and also serves as the Co-Chief Accounting officer of the Company, ORCC III, ORCIC and ORTIC and as the Co-Treasurer and Co-Controller of each of the Owl Rock BDCs. Before joining Blue Owl, Ms. McMillon led the accounting department of Tiptree Inc. (TIPT), a national capital holding company, as the Vice President of Technical Accounting and External Reporting from 2017-2022. She was responsible for financial reporting, valuation/purchase accounting, and numerous internal control functions. From 2013-2017, Ms. McMillon served as the Regional Accounting & Reporting Director, Americas of Koch Industries/Georgia Pacific, from 2009-2013 she served as an Accounting Manager at Oaktree Capital and Centerbridge Partners, and prior to that Ms. McMillon worked in public accounting for nearly ten years, spending most of this tenure at PricewaterhouseCoopers. Ms. McMillon earned her B.S. in Accounting from Florida State University and is a licensed Certified Public Accountant in New York.

132

Item 6. Exhibits, Financial Statement Schedules.


Exhibit Number		Description of Exhibits

3.1		Articles of Amendment and Restatement (incorporated by reference to Exhibit (a)(3) to Post-Effective Amendment No. 1 to the Registration Statement on Form N-2 filed on April 4, 2017).

3.2		Articles of Amendment (incorporated by reference to Exhibit 3.1 to the Company’s current Report on Form 8-K, filed on June 18, 2019).

3.3		First Amended and Restated Bylaws (incorporated by reference to Exhibit (b) to Post-Effective Amendment No. 1 to the Registration Statement on Form N-2, filed on April 4, 2017).

10.1		Amendment No. 2 to Credit Agreement, dated as of March 25, 2022, among ORCC II Financing II LLC, as Borrower, the Lenders referred to therein, Natixis, New York Branch, as Administrative Agent, State Street Bank and Trust Company, as Collateral Agent, Collateral Administrator, Custodian and Cortland Capital Market Services LLC as document custodian

31.1*		Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2*		Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1**		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2**		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

________________

* Filed herewith.

** Furnished herewith.

133

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized.


	Owl Rock Capital Corporation II

Date: May 11, 2022	By:	/s/ Craig W. Packer
		Craig W. Packer
		Chief Executive Officer

Date: May 11, 2022	By:	/s/ Bryan Cole
		Bryan Cole
		Chief Financial Officer and Chief Operating Officer

134