UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended June 30, 2019

OR

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

For the transition period from _____ to _____        

Commission File No. 814-00663

ARES CAPITAL CORPORATION

(Exact name of Registrant as specified in its charter) 

Maryland	33-1089684
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)

245 Park Avenue, 44th Floor, New York, NY 10167

(Address of principal executive office)   (Zip Code)

(212) 750-7300

(Registrant’s telephone number, including area code)

____________________________________________________________________

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 ýNo  o

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 o  No o

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

Large accelerated filer x	Accelerated filer o
Non-accelerated filer o	Smaller reporting company o
	Emerging growth company o

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 Securities Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o  No ý

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

Title of each class	Trading symbol	Name of each exchange on which registered
Common stock, $0.001 par value	ARCC	NASDAQ Global Select Market

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at July 24, 2019
Common stock, $0.001 par value	426,720,939

ARES CAPITAL CORPORATION

INDEX

Part I.	Financial Information
Item 1.	Financial Statements
	Consolidated Balance Sheet as of June 30, 2019 (unaudited) and December 31, 2018	3
	Consolidated Statement of Operations for the three and six months ended June 30, 2019 and 2018 (unaudited)	4
	Consolidated Schedule of Investments as of June 30, 2019 (unaudited) and December 31, 2018	5
	Consolidated Statement of Stockholders’ Equity for the three and six months ended June 30, 2019 (unaudited) and the year ended December 31, 2018	90
	Consolidated Statement of Cash Flows for the six months ended June 30, 2019 and 2018 (unaudited)	91
	Notes to Consolidated Financial Statements (unaudited)	92
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	126
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	152
Item 4.	Controls and Procedures	153
Part II.	Other Information
Item 1.	Legal Proceedings	153
Item 1A.	Risk Factors	153
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	154
Item 3.	Defaults Upon Senior Securities	154
Item 4.	Mine Safety Disclosures	154
Item 5.	Other Information	155
Item 6.	Exhibits	156

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(in millions, except per share data)

	As of
	June 30, 2019		December 31, 2018
	(unaudited)
ASSETS
Investments at fair value
Non-controlled/non-affiliate company investments	$	10,695	$	10,478
Non-controlled affiliate company investments	301		292
Controlled affiliate company investments	1,996		1,647
Total investments at fair value (amortized cost of $13,391 and $12,754, respectively)	12,992		12,417
Cash and cash equivalents	572		296
Interest receivable	105		91
Operating lease right-of-use asset	101		—
Other assets	76		79
Receivable for open trades	—		12
Total assets	$	13,846	$	12,895
LIABILITIES
Debt	$	6,024	$	5,214
Base management fees payable	50		45
Income based fees payable	39		36
Capital gains incentive fees payable	63		112
Interest and facility fees payable	62		64
Payable for open trades	2		25
Operating lease liabilities	131		—
Accounts payable and other liabilities	107		99
Total liabilities	6,478		5,595
Commitments and contingencies (Note 7)
STOCKHOLDERS’ EQUITY
Common stock, par value $0.001 per share, 600 common shares authorized; 427 and 426 common shares issued and outstanding, respectively	—		—
Capital in excess of par value	7,185		7,173
Accumulated undistributed earnings	183		127
Total stockholders’ equity	7,368		7,300
Total liabilities and stockholders’ equity	$	13,846	$	12,895
NET ASSETS PER SHARE	$	17.27	$	17.12

See accompanying notes to consolidated financial statements.

3

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS

(in millions, except per share data)

(unaudited)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2019			2018			2019			2018
INVESTMENT INCOME:
From non-controlled/non-affiliate company investments:
Interest income from investments (excluding payment-in-kind (“PIK”) interest income)	$	228		$	199		$	461		$	396
PIK interest income from investments	16			18			28			35
Capital structuring service fees	28			20			67			46
Dividend income	20			8			35			17
Other income	8			20			16			26
Total investment income from non-controlled/non-affiliate company investments	300			265			607			520
From non-controlled affiliate company investments:
Interest income from investments (excluding PIK interest income)	4			4			9			8
PIK interest income from investments	1			1			2			2
Capital structuring service fees	—			—			2			—
Dividend income	—			—			1			—
Total investment income from non-controlled affiliate company investments	5			5			14			10
From controlled affiliate company investments:
Interest income from investments (excluding PIK interest income)	41			34			74			63
PIK interest income from investments	6			6			11			12
Capital structuring service fees	10			5			14			8
Dividend income	18			16			33			29
Other income	2			2			2			8
Total investment income from controlled affiliate company investments	77			63			134			120
Total investment income	382			333			755			650
EXPENSES:
Interest and credit facility fees	69			61			136			121
Base management fees	50			45			99			91
Income based fees	49			40			97			78
Capital gains incentive fees	(1		)	18			1			38
Administrative fees	3			4			7			7
Other general and administrative	10			7			18			18
Total expenses	180			175			358			353
Waiver of income based fees	(10		)	(10		)	(20		)	(20		)
Total expenses, net of waiver of income based fees	170			165			338			333
NET INVESTMENT INCOME BEFORE INCOME TAXES	212			168			417			317
Income tax expense, including excise tax	4			6			8			11
NET INVESTMENT INCOME	208			162			409			306
REALIZED AND UNREALIZED GAINS (LOSSES) ON INVESTMENTS, FOREIGN CURRENCY AND OTHER TRANSACTIONS:
Net realized gains (losses):
Non-controlled/non-affiliate company investments	18			24			25			24
Controlled affiliate company investments	—			(2		)	—			(2		)
Foreign currency and other transactions	3			5			52			(7		)
Net realized gains	21			27			77			15
Net unrealized gains (losses):
Non-controlled/non-affiliate company investments	(34		)	(6		)	(67		)	10
Non-controlled affiliate company investments	16			(4		)	9			(2		)
Controlled affiliate company investments	(6		)	70			(5		)	148
Foreign currency and other transactions	(5		)	5			(9		)	19
Net unrealized gains (losses)	(29		)	65			(72		)	175
Net realized and unrealized gains (losses) on investments, foreign currency and other transactions	(8		)	92			5			190
NET INCREASE IN STOCKHOLDERS’ EQUITY RESULTING FROM OPERATIONS	$	200		$	254		$	414		$	496
BASIC AND DILUTED EARNINGS PER COMMON SHARE (see Note 10)	$	0.47		$	0.60		$	0.97		$	1.16
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING (see Note 10)	426			426			426			426

See accompanying notes to consolidated financial statements.

4

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of June 30, 2019

(dollar amounts in millions)

(unaudited)

Company(1)	Business Description	Investment	Interest(5)(9)	Acquisition Date	Amortized Cost		Fair Value			Percentage of Net Assets
Healthcare Services
Absolute Dental Management LLC and ADM Equity, LLC	Dental services provider	First lien senior secured loan ($0.8 par due 1/2022)	9.91% (Libor + 7.50%/Q)	1/15/2019	$	0.8	$	0.8	(2)(15)
		First lien senior secured loan ($24.4 par due 1/2022)		1/5/2016	24.2		6.3		(2)(14)
		Class A preferred units (4,000,000 units)		1/5/2016	4.0		—		(2)
		Class A common units (4,000,000 units)		1/5/2016	—		—		(2)
					29.0		7.1
Acessa Health Inc. (fka HALT Medical, Inc.)	Medical supply provider	Common stock (569,823 shares)		6/22/2017	0.1		—
ADCS Billings Intermediate Holdings, LLC (19)	Dermatology practice	First lien senior secured revolving loan ($0.6 par due 5/2022)	8.21% (Libor + 5.75%/B)	5/18/2016	0.6		0.6		(2)(15)
		First lien senior secured revolving loan ($1.3 par due 5/2022)	8.08% (Libor + 5.75%/Q)	5/18/2016	1.3		1.2		(2)(15)
					1.9		1.8
ADG, LLC and RC IV GEDC Investor LLC (19)	Dental services provider	First lien senior secured revolving loan ($2.7 par due 9/2022)	7.15% (Libor + 4.75%/M)	9/28/2016	2.7		2.6		(2)(15)
		First lien senior secured revolving loan ($2.4 par due 9/2022)	9.25% (Base Rate + 3.75%/Q)	9/28/2016	2.4		2.3		(2)(15)
		Second lien senior secured loan ($89.0 par due 3/2024)	12.20% (Libor + 10.00%/S)	9/28/2016	89.0		74.8		(2)(15)
		Membership units (3,000,000 units)		9/28/2016	3.0		0.2		(2)
					97.1		79.9
Air Medical Group Holdings, Inc. and Air Medical Buyer Corp.	Emergency air medical services provider	Senior subordinated loan ($182.7 par due 3/2026)	10.287% (Libor + 7.88%/M)	3/14/2018	182.7		182.7		(2)(15)
		Warrant to purchase up to 115,733 units of common stock (expires 3/2028)		3/14/2018	0.9		1.5		(2)
					183.6		184.2
Alcami Corporation and ACM Holdings I, LLC (19)	Outsourced drug development services provider	First lien senior secured loan ($30.0 par due 7/2025)	6.65% (Libor + 4.25%/M)	7/12/2018	29.8		28.8		(3)
		Second lien senior secured loan ($77.5 par due 7/2026)	10.40% (Libor + 8.00%/M)	7/12/2018	76.8		70.5		(2)
		Common units (3,269,900 units)		7/12/2018	32.7		18.6		(2)
					139.3		117.9
Alteon Health, LLC	Provider of physician management services	First lien senior secured loan ($3.0 par due 9/2022)	8.90% (Libor + 6.50%/M)	5/15/2017	3.0		2.7		(2)(15)
athenahealth, Inc., VVC Holding Corp., Virence Intermediate Holding Corp., and Virence Holdings LLC (19)	Revenue cycle management provider to the physician practices and acute care hospitals	First lien senior secured loan ($16.1 par due 2/2026)	7.05% (Libor + 4.50%/Q)	2/11/2019	15.8		16.1		(2)
		Second lien senior secured loan ($210.3 par due 2/2027)	11.04% (Libor + 8.50%/Q)	2/11/2019	210.3		206.1		(2)
		Senior preferred stock (121,810 shares)	13.54% PIK (Libor + 11.13%/Q)	2/11/2019	124.1		124.1		(2)
		Class A interests (0.39% interest)		2/11/2019	9.0		9.0		(2)
					359.2		355.3
Bambino CI Inc. (19)	Manufacturer and provider of single-use obstetrics products	First lien senior secured revolving loan ($0.1 par due 10/2022)	7.89% (Libor + 5.50%/M)	10/17/2017	0.1		0.1		(2)(15)
		First lien senior secured revolving loan ($0.8 par due 10/2022)	7.91% (Libor + 5.50%/M)	10/17/2017	0.8		0.8		(2)(15)

5

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of June 30, 2019

(dollar amounts in millions)

(unaudited)

Company(1)	Business Description	Investment	Interest(5)(9)	Acquisition Date	Amortized Cost	Fair Value		Percentage of Net Assets
		First lien senior secured revolving loan ($1.1 par due 10/2022)	7.97% (Libor + 5.50%/M)	10/17/2017	1.1	1.1	(2)(15)
		First lien senior secured revolving loan ($1.1 par due 10/2022)	10.00% (Base Rate + 4.50%/M)	10/17/2017	1.1	1.1	(2)(15)
		First lien senior secured loan ($30.7 par due 10/2023)	7.90% (Libor + 5.50%/M)	10/17/2017	30.7	30.7	(3)(15)
					33.8	33.8
Care Hospice, Inc (19)	Provider of hospice services	First lien senior secured revolving loan	—	2/8/2018	—	—	(2)(17)
CCS-CMGC Holdings, Inc. (19)	Correctional facility healthcare operator	First lien senior secured revolving loan	—	10/1/2018	—	—	(2)(17)
		First lien senior secured loan ($34.8 par due 10/2025)	7.90% (Libor + 5.50%/M)	9/25/2018	34.5	34.5	(3)
					34.5	34.5
Center for Autism and Related Disorders, LLC (19)	Autism treatment and services provider specializing in applied behavior analysis therapy	First lien senior secured revolving loan	—	11/21/2018	—	—	(2)(17)
Comprehensive EyeCare Partners, LLC (19)	Vision care practice management company	First lien senior secured revolving loan ($0.1 par due 2/2024)	7.10% (Libor + 4.50%/Q)	2/14/2018	0.1	0.1	(2)(15)
		First lien senior secured revolving loan ($0.2 par due 2/2024)	6.83% (Libor + 4.50%/Q)	2/14/2018	0.2	0.2	(2)(15)
		First lien senior secured loan ($2.4 par due 2/2024)	7.12% (Libor + 4.50%/Q)	2/14/2018	2.4	2.4	(2)(15)
		First lien senior secured loan ($5.4 par due 2/2024)	7.12% (Libor + 4.50%/Q)	2/14/2018	5.4	5.3	(2)(15)
					8.1	8.0
D4C Dental Brands HoldCo, Inc. and Bambino Group Holdings, LLC (19)	Dental services provider	First lien senior secured revolving loan ($2.0 par due 12/2022)	10.75% (Base Rate + 5.25%/Q)	12/21/2016	2.0	2.0	(2)(15)
		Class A preferred units (1,000,000 units)	8.00% PIK	12/21/2016	1.0	1.2	(2)
					3.0	3.2
Datix Bidco Limited (8)	Global healthcare software company that provides software solutions for patient safety and risk management	First lien senior secured loan ($2.9 par due 4/2025)	7.12% (Libor + 4.50%/S)	4/27/2018	2.9	2.9	(2)
		First lien senior secured loan ($2.9 par due 4/2025)	7.12% (Libor + 4.50%/S)	4/27/2018	2.9	2.9	(2)
		First lien senior secured loan ($10.0 par due 4/2025)	7.04% (Libor + 4.50%/S)	5/28/2019	9.9	10.0	(2)
					15.7	15.8
DCA Investment Holding, LLC (19)	Multi-branded dental practice management	First lien senior secured revolving loan ($0.9 par due 7/2021)	9.75% (Base Rate + 4.25%/Q)	7/2/2015	0.9	0.9	(2)(15)(18)
		First lien senior secured loan ($18.4 par due 7/2021)	7.58% (Libor + 5.25%/Q)	7/2/2015	18.4	18.4	(4)(15)
					19.3	19.3
Emerus Holdings, Inc. (18)	Freestanding 24-hour emergency care micro-hospitals operator	First lien senior secured loan ($16.5 par due 2/2022)	14.00%	2/21/2019	16.5	16.5	(2)
GHX Ultimate Parent Corporation, Commerce Parent, Inc. and Commerce Topco, LLC	On-demand supply chain automation solutions provider to the healthcare industry	Second lien senior secured loan ($34.5 par due 6/2025)	10.33% (Libor + 8.00%/Q)	6/30/2017	34.2	34.5	(2)(15)
		Series A preferred stock (110,425 shares)	13.34% PIK (Libor + 10.75%/Q)	6/30/2017	142.7	142.7	(2)(15)
		Class A units (14,013,303 units)		6/30/2017	14.0	15.0	(2)
					190.9	192.2
Greenphire, Inc. and RMCF III CIV XXIX, L.P	Software provider for clinical trial management	Limited partnership interest (99.90% interest)		12/19/2014	1.0	3.7	(2)

6

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of June 30, 2019

(dollar amounts in millions)

(unaudited)

Company(1)	Business Description	Investment	Interest(5)(9)	Acquisition Date	Amortized Cost	Fair Value		Percentage of Net Assets
Hygiena Borrower LLC (19)	Adenosine triphosphate testing technology provider	Second lien senior secured loan ($11.1 par due 8/2023)	10.08% (Libor + 7.75%/Q)	6/29/2018	11.1	11.1	(2)(15)
		Second lien senior secured loan ($0.6 par due 8/2023)	10.08% (Libor + 7.75%/Q)	6/29/2018	0.6	0.6	(2)(15)
		Second lien senior secured loan ($2.5 par due 8/2023)	10.08% (Libor + 7.75%/Q)	8/26/2016	2.5	2.5	(2)(15)
		Second lien senior secured loan ($10.7 par due 8/2023)	10.08% (Libor + 7.75%/Q)	2/27/2017	10.7	10.7	(2)(15)
					24.9	24.9
JDC Healthcare Management, LLC (19)	Dental services provider	First lien senior secured revolving loan ($1.2 par due 4/2022)	10.15% (Libor + 7.75%/M)	4/10/2017	1.2	1.1	(2)(15)
		First lien senior secured revolving loan ($1.2 par due 4/2022)	10.16% (Libor + 7.75%/M)	4/10/2017	1.2	1.1	(2)(15)
		First lien senior secured loan ($4.2 par due 4/2023)	10.15% (Libor + 6.75% Cash, 1.00% PIK/M)	4/10/2017	4.2	3.8	(2)(15)
		First lien senior secured loan ($9.9 par due 4/2023)	10.15% (Libor + 6.75% Cash, 1.00% PIK/M)	4/10/2017	9.9	9.0	(2)(15)
		First lien senior secured loan ($19.7 par due 4/2023)	10.15% (Libor + 6.75% Cash, 1.00% PIK/M)	4/10/2017	19.7	17.9	(4)(15)
					36.2	32.9
KBHS Acquisition, LLC (d/b/a Alita Care, LLC) (19)	Provider of behavioral health services	First lien senior secured revolving loan ($0.2 par due 3/2022)	7.41% (Libor + 5.00%/M)	3/17/2017	0.2	0.2	(2)(15)
		First lien senior secured revolving loan ($0.6 par due 3/2022)	7.39% (Libor + 5.00%/M)	3/17/2017	0.6	0.5	(2)(15)
		First lien senior secured revolving loan ($1.0 par due 3/2022)	7.38% (Libor + 5.00%/M)	3/17/2017	1.0	0.9	(2)(15)
		First lien senior secured revolving loan ($0.9 par due 3/2022)	7.40% (Libor + 5.00%/M)	3/17/2017	0.9	0.9	(2)(15)
		First lien senior secured revolving loan ($2.1 par due 3/2022)	7.40% (Libor + 5.00%/M)	3/17/2017	2.1	2.0	(2)(15)
		First lien senior secured revolving loan ($0.2 par due 3/2022)	7.44% (Libor + 5.00%/M)	3/17/2017	0.2	0.2	(2)(15)
					5.0	4.7
Key Surgical LLC (19)	Provider of sterile processing, operating room and instrument care supplies for hospitals	First lien senior secured revolving loan ($0.1 par due 6/2022)	9.25% (Base Rate + 3.75%/B)	6/1/2017	0.1	0.1	(2)(15)
		First lien senior secured loan ($16.8 par due 6/2023)	5.75% (EURIBOR + 4.75%/Q)	6/1/2017	16.6	16.8	(2)(15)
					16.7	16.9
MB2 Dental Solutions, LLC (19)	Dental services provider	First lien senior secured revolving loan ($1.6 par due 9/2023)	9.25% (Base Rate + 3.75%/Q)	9/29/2017	1.6	1.6	(2)(15)
		First lien senior secured loan ($1.7 par due 9/2023)	7.16% (Libor + 4.75%/M)	9/29/2017	1.7	1.7	(2)(15)
					3.3	3.3
MCH Holdings, Inc. and MC Acquisition Holdings I, LLC	Healthcare professional provider	First lien senior secured loan ($14.5 par due 1/2020)	7.90% (Libor + 5.50%/M)	7/26/2017	14.5	14.5	(2)(15)
		First lien senior secured loan ($13.4 par due 1/2020)	7.90% (Libor + 5.50%/M)	7/26/2017	13.4	13.4	(2)(15)

7

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of June 30, 2019

(dollar amounts in millions)

(unaudited)

Company(1)	Business Description	Investment	Interest(5)(9)	Acquisition Date	Amortized Cost	Fair Value		Percentage of Net Assets
		First lien senior secured loan ($39.6 par due 1/2020)	7.90% (Libor + 5.50%/M)	7/26/2017	39.6	39.6	(3)(15)
		First lien senior secured loan ($36.8 par due 1/2020)	7.90% (Libor + 5.50%/M)	7/26/2017	36.8	36.8	(3)(15)
		First lien senior secured loan ($15.2 par due 1/2020)	7.90% (Libor + 5.50%/M)	7/26/2017	15.2	15.2	(2)(15)
		First lien senior secured loan ($14.1 par due 1/2020)	7.90% (Libor + 5.50%/M)	7/26/2017	14.1	14.1	(4)(15)
		Class A units (1,438,643 shares)		1/17/2014	1.5	1.2	(2)
					135.1	134.8
MW Dental Holding Corp. (19)	Dental services provider	First lien senior secured revolving loan ($7.5 par due 4/2021)	9.08% (Libor + 6.75%/Q)	4/12/2011	7.5	7.5	(2)(15)
		First lien senior secured loan ($0.4 par due 4/2021)	9.15% (Libor + 6.75%/Q)	3/19/2018	0.4	0.4	(2)(15)
		First lien senior secured loan ($20.7 par due 4/2021)	9.08% (Libor + 6.75%/Q)	3/19/2018	20.7	20.7	(2)(15)
		First lien senior secured loan ($104.0 par due 4/2021)	9.08% (Libor + 6.75%/Q)	4/12/2011	104.0	104.0	(2)(15)
		First lien senior secured loan ($19.0 par due 4/2021)	9.08% (Libor + 6.75%/Q)	4/12/2011	19.0	19.0	(4)(15)
					151.6	151.6
My Health Direct, Inc.	Healthcare scheduling exchange software solution provider	Warrant to purchase up to 4,548 shares of Series D preferred stock (expires 9/2024)		9/18/2014	—	—	(2)
New Trident Holdcorp, Inc. and Trident Holding Company, LLC	Outsourced mobile diagnostic healthcare service provider	Second lien senior secured loan ($78.4 par due 7/2020)		8/1/2013	67.8	—	(2)(14)
		Second lien senior secured loan ($25.2 par due 7/2022)		8/1/2013	19.4	—	(2)(14)
		Senior subordinated loan ($9.1 par due 7/2020)		11/29/2017	8.8	—	(2)(14)
					96.0	—
NMC Skincare Intermediate Holdings II, LLC (19)	Developer, manufacturer and marketer of skincare products	First lien senior secured revolving loan ($1.6 par due 10/2024)	7.15% (Libor + 4.75%/M)	10/31/2018	1.6	1.6	(2)
		First lien senior secured loan ($1.7 par due 10/2024)	7.15% (Libor + 4.75%/M)	10/31/2018	1.7	1.7	(2)
		First lien senior secured loan ($24.8 par due 10/2024)	7.15% (Libor + 4.75%/M)	10/31/2018	24.8	24.8	(3)
					28.1	28.1
NMN Holdings III Corp. and NMN Holdings LP (19)	Provider of complex rehab technology solutions for patients with mobility loss	Partnership units (30,000 units)		11/13/2018	3.0	3.0	(2)
NMSC Holdings, Inc. and ASP NAPA Holdings, LLC	Anesthesia management services provider	Second lien senior secured loan ($72.8 par due 10/2023)	12.58% (Libor + 10.00%/Q)	4/19/2016	72.8	72.8	(2)(15)
		Class A units (25,790 units)		4/19/2016	2.6	1.3	(2)
					75.4	74.1
Nodality, Inc.	Biotechnology company	First lien senior secured loan ($2.3 par due 8/2016)		11/12/2015	1.5	—	(2)(14)
		First lien senior secured loan ($0.8 par due 8/2016)		11/12/2015	0.6	—	(2)(14)
		First lien senior secured loan ($3.9 par due 8/2016)		4/25/2014	2.6	—	(2)(14)
		First lien senior secured loan ($11.0 par due 8/2016)		4/25/2014	7.1	—	(2)(14)
		Warrant to purchase up to 3,736,255 shares of common stock (expires 3/2026)		5/1/2016	—	—	(2)
					11.8	—

8

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of June 30, 2019

(dollar amounts in millions)

(unaudited)

Company(1)	Business Description	Investment	Interest(5)(9)	Acquisition Date	Amortized Cost	Fair Value		Percentage of Net Assets
NSM Sub Holdings Corp. (19)	Provider of customized mobility, rehab and adaptive seating systems	First lien senior secured revolving loan ($0.5 par due 10/2022)	10.25% (Base Rate + 4.75%/Q)	9/28/2017	0.5	0.5	(2)(15)
		First lien senior secured loan ($10.1 par due 10/2022)	8.08% (Libor + 5.75%/Q)	5/3/2019	10.1	10.0	(2)(15)
					10.6	10.5
nThrive, Inc. (fka Precyse Acquisition Corp.)	Provider of healthcare information management technology and services	Second lien senior secured loan ($10.0 par due 4/2023)	12.15% (Libor + 9.75%/M)	4/20/2016	9.8	9.8	(2)(15)
NueHealth Performance, LLC (19)	Developer, builder and manager of specialty surgical hospitals and ambulatory surgery centers	First lien senior secured loan ($1.5 par due 9/2023)	8.90% (Libor + 6.50%/M)	9/27/2018	1.5	1.5	(2)(15)
		First lien senior secured loan ($10.0 par due 9/2023)	8.90% (Libor + 6.50%/M)	9/27/2018	10.0	10.0	(2)(15)
					11.5	11.5
OmniSYS Acquisition Corporation, OmniSYS, LLC, and OSYS Holdings, LLC	Provider of technology-enabled solutions to pharmacies	Limited liability company membership interest (1.57%)		11/21/2013	1.0	0.7	(2)
Pathway Vet Alliance LLC and Pathway Vet Alliance Holding LLC (19)	Operator of freestanding veterinary hospitals	First lien senior secured revolving loan	—	12/21/2018	—	—	(2)(17)
		First lien senior secured loan ($10.8 par due 12/2024)	6.90% (Libor + 4.50%/M)	12/21/2018	10.8	10.7	(2)(15)
		First lien senior secured loan ($57.4 par due 12/2024)	6.90% (Libor + 4.50%/M)	12/21/2018	56.8	56.8	(2)(15)
		Second lien senior secured loan ($27.4 par due 12/2025)	10.90% (Libor + 8.50%/M)		27.4	27.2	(2)(15)
		Second lien senior secured loan ($163.9 par due 12/2025)	10.90% (Libor + 8.50%/M)	12/21/2018	163.9	163.1	(2)(15)
		Preferred units (1,507,384 units)		12/21/2018	4.9	5.9
					263.8	263.7
Patterson Medical Supply, Inc.	Distributor of rehabilitation supplies and equipment	Second lien senior secured loan ($78.0 par due 8/2023)	11.08% (Libor + 8.50%/Q)	9/2/2015	76.9	67.9	(2)(15)
Phylogeny, LLC and Conversant Biologics, LLC (fka WSHP FC Acquisition LLC) (19)	Provider of biospecimen products for pharma research	First lien senior secured revolving loan ($0.8 par due 3/2024)	8.83% (Libor + 6.50%/Q)	3/30/2018	0.8	0.8	(2)(15)
		First lien senior secured loan ($6.0 par due 3/2024)	8.83% (Libor + 6.50%/Q)	3/30/2018	6.0	6.0	(2)(15)
		First lien senior secured loan ($4.7 par due 3/2024)	8.83% (Libor + 6.50%/Q)	2/11/2019	4.7	4.7	(2)(15)
		First lien senior secured loan ($28.3 par due 3/2024)	8.83% (Libor + 6.50%/Q)	3/30/2018	28.3	28.3	(3)(15)
					39.8	39.8
PhyMED Management LLC	Provider of anesthesia services	Second lien senior secured loan ($47.2 par due 5/2021)	11.15% (Libor + 8.75%/M)	12/18/2015	47.0	46.8	(2)(15)
Premise Health Holding Corp. and OMERS Bluejay Investment Holdings LP (19)	Provider of employer-sponsored onsite health and wellness clinics and pharmacies	First lien senior secured loan ($10.9 par due 7/2025)	5.83% (Libor + 3.50%/Q)	7/10/2018	10.9	10.8	(4)
		Second lien senior secured loan ($67.1 par due 7/2026)	9.83% (Libor + 7.50%/Q)	7/10/2018	66.5	66.4	(2)
		Class A units (9,775 units)		7/10/2018	9.8	11.0	(2)
					87.2	88.2
ProVation Medical, Inc.	Provider of documentation and coding software for GI physicians	First lien senior secured loan ($13.0 par due 3/2024)	9.58% (Libor + 7.00%/Q)	3/9/2018	12.8	13.0	(2)
RecoveryDirect Acquisition, L.L.C. (18)	Outpatient physical therapy provider	First lien senior secured loan ($6.9 par due 1/2024)	6.40% (Libor + 4.00%/M)	1/3/2018	6.9	6.9	(2)(15)
		First lien senior secured loan ($30.6 par due 1/2024)	6.40% (Libor + 4.00%/M)	1/3/2018	30.6	30.6	(4)(15)
					37.5	37.5

9

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of June 30, 2019

(dollar amounts in millions)

(unaudited)

Company(1)	Business Description	Investment	Interest(5)(9)	Acquisition Date	Amortized Cost	Fair Value		Percentage of Net Assets
Respicardia, Inc.	Developer of implantable therapies to improve cardiovascular health	Warrant to purchase up to 99,094 shares of Series C preferred stock (expires 6/2022)		6/28/2012	—	—	(2)
Retriever Medical/Dental Payments LLC (19)	Provider of payment processing services and software to healthcare providers	First lien senior secured loan ($2.0 par due 2/2023)	6.83% (Libor + 4.50%/Q)	3/14/2019	2.0	2.0	(2)(15)
RTI Surgical, Inc.	Manufacturer of biologic, metal and synthetic implants/devices	Second lien senior secured loan ($92.1 par due 12/2023)	11.16% (Libor + 8.75%/M)	3/8/2019	92.1	91.2	(2)(15)
Salter Labs (8)(19)	Developer, manufacturer and supplier of consumable products for medical device customers	First lien senior secured revolving loan ($0.6 par due 3/2020)	6.58% (Libor + 4.25%/Q)	2/8/2018	0.6	0.6	(2)(15)(18)
SCSG EA Acquisition Company, Inc. (19)	Provider of outsourced clinical services to hospitals and health systems	First lien senior secured revolving loan	—	9/1/2017	—	—	(2)(17)
SiroMed Physician Services, Inc. and SiroMed Equity Holdings, LLC (19)	Outsourced anesthesia provider	First lien senior secured loan ($17.1 par due 3/2024)	7.08% (Libor + 4.75%/Q)	3/26/2018	17.1	14.9	(3)(15)
		Common units (684,854 units)		3/26/2018	4.8	0.2	(2)
					21.9	15.1
SM Wellness Holdings, Inc. and SM Holdco, Inc. (19)	Breast cancer screening provider	First lien senior secured loan ($7.1 par due 8/2024)	7.90% (Libor + 5.50%/M)	8/1/2018	7.1	7.1	(2)
		Series A preferred stock (44,975 shares)	12.84% PIK (Libor + 10.25%/Q)	8/1/2018	50.5	50.2	(2)
		Series A units (7,475 units)		8/1/2018	7.5	0.1	(2)
		Series B units (747,500 units)		8/1/2018	—	7.7	(2)
					65.1	65.1
Synergy HomeCare Franchising, LLC and NP/Synergy Holdings, LLC (19)	Franchisor of private-pay home care for the elderly	First lien senior secured loan ($16.0 par due 4/2024)	8.08% (Libor + 5.75%/Q)	4/2/2018	16.0	16.0	(2)(15)
		Common units (550 units)		4/2/2018	0.6	0.7
					16.6	16.7
Teligent, Inc. (19)	Pharmaceutical company that develops, manufactures and markets injectable pharmaceutical products	Second lien senior secured loan ($19.4 par due 6/2024)	11.08% (Libor + 7.75% Cash, 1.00% PIK/Q)	12/13/2018	19.4	19.0	(2)(15)
		Second lien senior secured loan ($48.2 par due 6/2024)	11.20% (Libor + 7.75% Cash, 1.00% PIK/Q)	12/13/2018	48.2	47.2	(2)(15)
					67.6	66.2
TerSera Therapeutics LLC	Acquirer and developer of specialty therapeutic pharmaceutical products	First lien senior secured loan ($2.1 par due 3/2023)	7.58% (Libor + 5.25%/Q)	9/27/2018	2.1	2.1	(2)(15)
		First lien senior secured loan ($5.2 par due 3/2023)	7.58 % (Libor + 5.25%/Q)	5/3/2017	5.2	5.2	(4)(15)
		First lien senior secured loan ($1.8 par due 3/2023)	7.58% (Libor + 5.25%/Q)	4/1/2019	1.8	1.8	(2)(15)
					9.1	9.1
U.S. Acute Care Solutions, LLC (19)	Provider of physician management services	First lien senior secured revolving loan ($1.1 par due 1/2022)	7.40% (Libor + 5.00%/M)	2/8/2018	1.1	1.1	(2)
U.S. Anesthesia Partners, Inc.	Anesthesiology service provider	Second lien senior secured loan ($71.8 par due 6/2025)	9.65% (Libor + 7.25%/M)	6/16/2017	71.0	71.8	(2)(15)
United Digestive MSO Parent, LLC (18)	Gastroenterology physician group	First lien senior secured loan ($12.5 par due 12/2024)	7.08% (Libor + 4.50%/Q)	12/14/2018	12.5	12.5	(2)(15)
Urgent Cares of America Holdings I, LLC and FastMed Holdings I, LLC (19)	Operator of urgent care clinics	First lien senior secured revolving loan ($10.0 par due 2/2022)	10.33% (Libor + 8.00%/Q)	8/15/2017	10.0	10.0	(2)(15)
		Preferred units (7,696,613 units)		6/11/2015	7.7	—
		Series A common units (2,000,000 units)		6/11/2015	2.0	—
		Series C common units (5,288,427 units)		6/11/2015	—	—

10

ARES CAPITAL CORPORATION AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

As of June 30, 2019

(dollar amounts in millions)

(unaudited)

Company(1)	Business Description	Investment	Interest(5)(9)	Acquisition Date	Amortized Cost	Fair Value		Percentage of Net Assets
					19.7	10.0
Urology Management Associates, LLC and JWC/UMA Holdings, L.P.	Urology private practice	First lien senior secured loan ($9.8 par due 8/2024)	7.40% (Libor + 5.00%/M)	8/31/2018	9.7	9.8	(2)(15)
		Limited partnership interests (3.64% interest)		8/31/2018	4.8	5.3	(2)
					14.5	15.1
Verscend Holding Corp. (19)	Healthcare analytics solutions provider	First lien senior secured loan ($47.0 par due 8/2025)	6.90% (Libor + 4.50%/M)	8/27/2018	46.7	46.9	(2)
Vertice Pharma UK Parent Limited (8)	Manufacturer and distributor of generic pharmaceutical products	Preferred shares (40,662 shares)	8.00% PIK	12/21/2015	0.3	0.5
West Dermatology, LLC (19)	Dermatology practice platform	First lien senior secured revolving loan ($0.6 par due 4/2022)	8.03% (Libor + 5.50%/Q)	2/8/2018	0.6	0.6	(2)(15)
		First lien senior secured revolving loan ($0.4 par due 4/2022)	7.91% (Libor + 5.50%/M)	2/8/2018	0.4	0.4	(2)(15)
		First lien senior secured loan ($2.2 par due 4/2023)	7.91% (Libor + 5.50%/M)	9/5/2018	2.2	2.2	(2)(15)
		First lien senior secured loan ($0.5 par due 4/2023)	7.91% (Libor + 5.50%/B)	9/5/2018	0.5	0.5	(2)(15)
		First lien senior secured loan ($3.0 par due 4/2023)	8.02% (Libor + 5.50%/Q)	9/5/2018	3.0	3.0	(2)(15)
		First lien senior secured loan ($1.3 par due 4/2023)	8.03% (Libor + 5.50%/Q)	9/5/2018	1.3	1.3	(2)(15)
		First lien senior secured loan ($0.2 par due 4/2023)	7.98% (Libor + 5.50%/Q)	9/5/2018	0.2	0.2	(2)(15)
		First lien senior secured loan ($4.6 par due 4/2023)	7.83% (Libor + 5.50%/Q)	9/5/2018	4.6	4.6	(2)(15)
		First lien senior secured loan ($7.5 par due 4/2023)	7.83% (Libor + 5.50%/Q)	4/2/2018	7.5	7.5	(2)(15)
					20.3	20.3