−Removed: Blackstone / GSO Secured Lending Fund was formed on March 26, 2018 as a Delaware statutory trust structured as a non-diversified, closed-end management investment company that has elected to be regulated as a BDC under the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the “ 1940 Act ”).
+Added: We were formed on March 26, 2018 as a Delaware statutory trust structured as a non-diversified, closed-end management investment company that has elected to be regulated as a BDC under the Investment Company Act of 1940, as amended (together with the rules and regulations promulgated thereunder, the “ 1940 Act ”).
In addition, for U.S.
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We are managed by our Adviser.
−Removed: GSO Capital Partners LP (the “ Administrator ” and, collectively with its affiliates in the credit-focused business of The Blackstone Group Inc., “ GSO ,” which, for the avoidance of doubt, excludes Harvest Fund Advisors LLC and Blackstone Insurance Solutions) provides the administrative services necessary for us to operate.
+Added: Blackstone Alternative Credit Advisors LP (the “ Administrator ” and, collectively with its affiliates in the credit-focused business of The Blackstone Group Inc., “ Blackstone Credit ,” which, for the avoidance of doubt, excludes Harvest Fund Advisors LLC and Blackstone Insurance Solutions (“ BIS ”) provides the administrative services necessary for us to operate.
Our investment objectives are to generate current income and, to a lesser extent, long-term capital appreciation.
−Removed: Under normal market conditions, we generally expect to invest at least 80% of our total assets (net assets plus borrowings for investment purposes) in secured debt investments (including investments that are secured by equity interests).
+Added: Under normal market conditions, we generally invest at least 80% of our total assets (net assets plus borrowings for investment purposes) in secured debt investments (including investments that are secured by equity interests).
Our portfolio is composed primarily of first lien senior secured and unitranche loans (including first out/last out loans), generally with total investment sizes less than $300 million, which criteria may change from time to time.
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We do not currently expect to focus on investments in issuers that are distressed or in need of rescue financing.
−Removed: Subject to the limitations of the 1940 Act, we may invest in loans or other securities, the proceeds of which may refinance or otherwise repay debt or securities of companies whose debt is owned by other GSO funds.
−Removed: As of December 31, 2019, based on fair value, our portfolio consisted of 98.50% first lien senior secured investments and unitranche loans, 1.05% second lien debt investments and 0.45% equity investments.
−Removed: All of our debt investments as of December 31, 2019 are floating rate in nature, all of which are subject to an interest rate floor.
+Added: Subject to the limitations of the 1940 Act, we may invest in loans or other securities, the proceeds of which may refinance or otherwise repay debt or securities of companies whose debt is owned by other Blackstone Credit funds.
+Added: As of December 31, 2020, based on fair value, our portfolio consisted of 98.51% first lien senior secured investments and unitranche loans, 0.90% second lien debt investments and 0.59% in equity instruments.
+Added: All of our debt investments as of December 31, 2020 were floating rate in nature (88.0% of which had an interest rate floor above zero) and the weighted average yield on our income producing investments was 7.68% at fair value.
As of December 31, 2020 we had investments in 81 portfolio companies, with a weighted average debt investment size in each of our portfolio companies of approximately $69.4 million based on fair value.
+Added: As a BDC, at least 70% of our assets must be the type of "qualifying" assets listed in Section 55(a) of the 1940 Act, as described herein, which are generally privately-offered securities issued by U.S.
+Added: private or thinly-traded companies.
+Added: We may also invest up to 30% of our portfolio opportunistically in "non-qualifying" portfolio investments, such as investments in non-U.S.
We generally intend to distribute substantially all of our available earnings annually by making quarterly cash distributions.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations—Financial Condition, Liquidity and Capital Resources—Borrowings .”
+Added: Effective on December 10, 2020, we changed our name from “Blackstone / GSO Secured Lending Fund” to “Blackstone Secured Lending Fund.”
+Added: COVID-19 Update
+Added: Equity, debt, lending and other financial markets have experienced significant volatility recently related to COVID-19 pandemic and its effects.
+Added: Although many markets have experienced varying degrees of recovery since the initial outbreak of COVID-19, the future impact of the pandemic on financial markets and the Company and its investments is still uncertain.
+Added: See “ Item 1A.
+Added: Risk Factors ” for additional risks around COVID-19 and its impact on the Company.
Our Investment Adviser
−Removed: Our investment activities are managed by our Adviser, a subsidiary of GSO Capital Partners LP, the primary investment manager for GSO.
+Added: Our investment activities are managed by our Adviser, a subsidiary of Blackstone Alternative Credit Advisors LP, the primary investment manager for Blackstone Credit.
The principal executive offices of our Adviser are located at 345 Park Avenue, 31st Floor New York, NY, 10154.
Our Adviser is responsible for originating prospective investments, conducting research and due diligence investigations on potential investments, analyzing investment opportunities, negotiating and structuring our investments and monitoring our investments and portfolio companies on an ongoing basis.
−Removed: In conducting our investment activities, we believe that we benefit from the significant scale and resources of GSO, including our Adviser and its affiliates, subject to the policies and procedures of The Blackstone Group Inc.
+Added: In conducting our investment activities, we believe that we benefit from the significant scale and resources of Blackstone Credit, including our Adviser and its affiliates, subject to the policies and procedures of The Blackstone Group Inc.
(collectively with its affiliates as the context requires, “ Blackstone ”) regarding the management of conflicts of interest.
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The Adviser seeks to generate investment opportunities through direct origination channels as well as through syndicate and club deals.
−Removed: With respect to GSO’s origination channel, the global presence of GSO generates access to a substantial amount of directly originated transactions with what we believe to be attractive investment characteristics.
−Removed: With respect to syndicate and club deals (i.e., where a limited number of investors participate in a loan transaction), GSO has built a network of relationships with commercial and investment banks, finance companies and other investment funds as a result of the long track record of its investment professionals in the leveraged finance marketplace.
−Removed: GSO employs a rigorous investment process and defensive investment approach to evaluate all potential opportunities with a focus on long-term credit performance and principal protection.
−Removed: The investment professionals employed by GSO have spent their careers developing the resources necessary to invest in private companies.
+Added: With respect to Blackstone Credit’s origination channel, the global presence of Blackstone Credit generates access to a substantial amount of directly originated transactions with what we believe to be attractive investment characteristics.
+Added: With respect to syndicate and club deals (i.e., where a limited number of investors participate in a loan transaction), Blackstone Credit has built a network of relationships with commercial and investment banks, finance companies and other investment funds as a result of the long track record of its investment professionals in the leveraged finance marketplace.
+Added: Blackstone Credit also has a significant trading platform, which, we believe, allows us access to the secondary market for investment opportunities.
+Added: Blackstone Credit employs a rigorous investment process and defensive investment approach to evaluate all potential opportunities with a focus on long-term credit performance and principal protection.
+Added: The investment professionals employed by Blackstone Credit have spent their careers developing the resources necessary to invest in private companies.
Before undertaking an investment, the Adviser’s transaction team conducts a thorough and rigorous due diligence review of the opportunity to ensure the company fits our investment strategy.
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The Adviser’s Investment Committee review process is consensus-driven, multi-step and iterative, and occurs in parallel with the diligence and structuring of investments.
−Removed: Others who participate in the Investment Committee process include the team responsible for conducting due diligence, others on the investing team and other senior members of GSO.
+Added: Others who participate in the Investment Committee process include the team responsible for conducting due diligence, others on the investing team and other senior members of Blackstone Credit.
There are no representatives from other business groups of Blackstone involved in the Adviser’s Investment Committee process.
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Our Administrator
−Removed: GSO Capital Partners LP, a Delaware limited partnership, serves as our Administrator.
−Removed: The principal executive offices of GSO Capital Partners LP are located at 345 Park Avenue, New York, New York 10154.
+Added: Blackstone Alternative Credit Advisors LP, a Delaware limited partnership, serves as our Administrator.
+Added: The principal executive offices of our Administrator are located at 345 Park Avenue, New York, New York 10154.
We reimburse the Administrator for its costs, expenses and allocable overhead (including compensation of personnel performing administrative duties) in connection with administrative services performed for us.
See “— Administration Agreement .”
−Removed: GSO is part of Blackstone’s credit-focused platform and is the primary part of its credit reporting segment.
+Added: Blackstone Credit
+Added: Blackstone Credit is part of the credit-focused platform of Blackstone, which is a leading global manager of private capital.
Blackstone’s asset management businesses include investment vehicles focused on real estate, private equity, public debt and equity, growth equity, opportunistic, non-investment grade credit, real assets and secondary funds, all on a global basis.
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Through its different investment businesses, as of December 31, 2020, Blackstone had total assets under management of approximately $619 billion .
−Removed: As of December 31, 2019, GSO’s asset management operation had aggregate assets under management of approximately $124 billion across multiple strategies within the leveraged finance marketplace, including loans, high yield bonds, distressed and mezzanine debt and private equity, including hedge funds.
−Removed: GSO, through its affiliates, employed approximately 404 people in New York, London, Houston and Dublin as of January 1, 2020.
−Removed: As of January 1, 2020, GSO had a 76 person U.S.
−Removed: Direct Lending team (excluding Dwight Scott, Global Head of GSO) focused on the sourcing, structuring, exe cution management and realization of performing credit investments (which includes those professionals who focus primarily on direct lending investments).
−Removed: GSO believes that the depth and breadth of its team provides it with a significant competitive advantage in sourcing product on a global basis, structuring transactions and actively managing investments in the portfolio.
+Added: As of December 31, 2020, Blackstone Credit’s asset management operation had aggregate assets under management of approximatel y $145 billion a cross multiple strategies within the leveraged finance marketplace, including loans, high yield bonds, distressed and mezzanine debt and private equity, including hedge funds.
+Added: Blackstone Credit, through its affiliates, employed over 400 people in New York, London, Houston and Dublin, and satellite offices in Baltimore, San Francisco, Toronto, Frankfurt and Milan as of January 1, 2021.
+Added: As of January 1, 2021, Blackstone Credit had a 82 person U.S.
+Added: Direct Lending team (excluding Dwight Scott, a member of Blackstone Credit's senior management) focused on the sourcing, structuring, execution management and realization of performing credit investments (which includes those professionals who
+Added: focus primarily on direct lending investments).
+Added: Blackstone Credit believes that the depth and breadth of its team provides it with a significant competitive advantage in sourcing product on a global basis, structuring transactions and actively managing investments in the portfolio.
Market Opportunity
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Given current market conditions, we believe that debt issues with variable interest rates may offer a superior return profile to fixed-rate securities, since variable interest rate structures are generally less susceptible to declines in value experienced by fixed-rate securities in a rising interest rate environment.
−Removed: Senior secured debt provides strong defensive characteristics.
−Removed: Because this debt has priority in payment among an issuer’s security holders (i.e., holders are due to receive payment before junior creditors and equity holders), they carry the least
−Removed: potential risk among investments in the issuer’s capital structure.
+Added: While there is inherent risk in investing in any securities, senior secured debt is on the top of the capital structure and thus has priority in payment among an issuer's security holders (i.e.
+Added: senior secured debt holders are due to receive payment before junior creditors and equity holders).
Further, these investments are secured by the issuer’s assets, which may be seized in the event of a default, if necessary.
−Removed: They generally also carry restrictive covenants aimed at ensuring repayment before junior creditors, such as most types of unsecured bondholders, and other security holders and preserving collateral to protect against credit deterioration.
+Added: Senior secured debt often has restrictive covenants for the purpose of additional principal protection and ensuring repayment before junior creditors (i.e.
+Added: most types of unsecured bondholders, and other security holders) and preserving collateral to protect against credit deterioration.
Opportunity in Middle Market Private Companies
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We believe that the following characteristics support our belief:
−Removed: Large Target Market .
−Removed: Middle market companies represent a large and grow ing portion of the U.S.
−Removed: According to the National Center for the Middle Market, there were nearly 200,000 middle market companies in the United States with annual revenues between $10 million and $1 billion, as of December 31, 2019.
−Removed: As of December 31, 2019, these middle market companies represented $7.0 trillion of the U.S.
−Removed: gross domestic product and employed approximately 25% of the nation’s workforce, compared to less than 20% in 2011 (see Middle Market Power Index, Dun & Bradstreet (Jan.
−Removed: National Center for The Middle Market – 4Q 2019, and the International Monetary Fund as of December 2019.).
−Removed: Further, these middle market companies represent, we believe, a significant portion of the growth segment of the U.S.
−Removed: economy, with 7.5% of revenue growth in the past twelve months as of December 31, 2019 compared to 4.3% for S&P 500 companies, according to the National Center of the Middle Market, and often require substantial capital investment to grow their bu sinesses.
−Removed: Middle market companies have generated a significant number of investment opportunities for investment programs advised by GSO and its affiliates over the past several years, and we believe that this market segment will continue to produce significant investment opportunities for us.
+Added: Large and Growing Target Market .
+Added: Middle market companies represent a large and growing portion of the U.S.
+Added: According to the National Center for the Middle Market, there were nearly 200,000 middle market companies in the United States with annual revenues between $10 million and $1 billion, as of June 30, 2020.
+Added: Middle market companies have generated a significant number of investment opportunities for investment programs advised by Blackstone Credit and its affiliates over the past several years, and we believe that this market segment will continue to produce significant investment opportunities for us.
Limited Investment Competition.
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In addition, due to bank consolidation, the number of banks has also rapidly declined, furthering the lack of supply in middle market lending.
−Removed: As of March 2019, there were approximately 4,605 banks in the U.S., which was only one-third of the number of banks in 1984, according to Federal Reserve Economic Data.
+Added: As of April 2020, there were approximately 4,404 banks in the U.S., which was only one-third of the number of banks in 1984, according to Federal Reserve Economic Data.
We also believe that lending and originating new loans to middle market companies, which are often private, generally requires a greater dedication of the lender’s time and resources compared to lending to larger companies, due in part to the smaller size of each investment and the often fragmented nature of information available from these companies.
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In many environments, we believe that middle market companies are more likely to offer attractive economics in terms of transaction pricing, up-front and ongoing fees, prepayment penalties and security features in the form of stricter covenants and quality collateral than loans to larger companies.
−Removed: In addition, as compared to larger companies, middle market companies sometimes have simpler capital structures and carry less leverage, thus aiding the structuring and negotiation process and allowing us greater flexibility in structuring favorable transactions.
+Added: In addition, as compared to larger companies, middle market companies often have simpler capital structures and carry less leverage, thus aiding the
+Added: structuring and negotiation process and allowing us greater flexibility in structuring favorable transactions.
We believe that these factors will result in advantageous conditions in which to pursue our investment objectives of generating current income and, to a lesser extent, long-term capital appreciation.
−Removed: Competitive Strengths
−Removed: GSO is a key player in the middle and upper-middle market direct lending space.
−Removed: GSO has experience scaling funds across its platform that invest throughout all parts of the capital structure.
−Removed: GSO strives to focus on transactions where it can differentiate itself from other providers of capital, targeting larger transactions and those where GSO can bring its expertise and experience in negotiating and structuring.
−Removed: We believe that GSO is one of the few investment management firms with the scale and platform to effectively manage a U.S.
−Removed: direct lending investment strategy, offering investors the following potential competitive strengths:
−Removed: Scale of GSO Platform
−Removed: We believe that the breadth and scale of GSO’s approximately $124 billion platform, as of December 31, 2019, gives GSO a distinct competitive advantage in sourcing proprietary investment opportunities and provides GSO with a differentiated capability to invest in large, complex opportunities.
−Removed: GSO covers approximately 930 corporate credits globally and has focused primarily on the non-investment grade corporate credit market since its inception in 2005.
−Removed: GSO expects that in the current environment, in which committed capital from banks rem ains scarce (as tracked by S&P Capital IQ LCD, U.S.
−Removed: banks’ share of senior secured debt to middle market companies represented 12% of the overall middle market loan volume in 2019, down from nearly 20% in 2011), the ability to provide flexible, well-structured capital commitments in appropriate sizes will enable GSO to command more favorable terms for its investments.
−Removed: GSO beli eves that it occupies a differentiated position in the leveraged finance market, with investment activities that span a broad array of public and private market strategies.
−Removed: We believe this presence enables GSO to identify opportunities early and select those investments that GSO believes offer the most attractive risk-adjusted return profile.
−Removed: In addition, when banks are facing difficulties in syndicating new issues, GSO’s ability to serve as a large “anchor” investor can help facilitate the successful completion of a transaction.
−Removed: We believe the depth of the experience of GSO’s senior management team, together with the wider resources of GSO’s team of investment professionals (the “ Investment Team ”), which is dedicated to sourcing, structuring, executing, monitoring and harvesting a broad range of private investments, will provide us with a significant competitive advantage in sourcing and analyzing what we believe to be attractive investment opportunities.
−Removed: Sourcing and Origination Capabilities
−Removed: As of January 1, 2020 , GSO had a 76 pe rson U.S.
−Removed: Direct Lending team (excluding Dwight Scott, Global Head of GSO) focused on the sourcing, structuring, execution, management and realization of performing credit investments (which includes those professionals who focus primarily on direct lending investments).
−Removed: We believe that GSO’s strong reputation and longstanding relationships with corporate boards, management teams, leveraged buyout sponsors, financial advisors, and intermediaries position GSO as a partner and counterparty of choice and provides us with superior sourcing capabilities.
−Removed: In GSO’s experience, these relationships help drive substantial proprietary deal flow and insight into investment opportunities.
−Removed: GSO has a broad and diversified origination platf orm that we believe allows GSO to drive deal flow through various market cycles while maintaining quality control.
−Removed: In particular, we believe that GSO’s dedicated energy team provides a distinct competitive advantage.
−Removed: Furthermore, GSO has established a reputation fo r providing creative, value-added solutions to address portfolio companies’ financing requirements and believes that the ability to “solve a problem” for a company can lead to attractive investment opportunities.
−Removed: GSO seeks to generate investment opportunities through its direct origination channels and through syndicate and club deals (generally, investments made by a small group of investment firms).
−Removed: With respect to GSO’s origination channel, we seek to leverage the global presence of GSO to generate access to a substantial amount of directly originated transactions with attractive investment characteristics.
−Removed: We believe that the broad network of GSO provides a significant pipeline of investment opportunities for us.
−Removed: With respect to syndicate and club deals, GSO has built a network of relationships with commercial and investment banks, finance companies and other investment funds as a result of the long track record of its investment professionals in the leveraged finance marketplace.
−Removed: GSO also has a significant trading platform, which, we believe, allows us access to the secondary market for investment opportunities.
+Added: Blackstone Credit Strengths
+Added: Blackstone Credit is a key player in the middle and upper-middle market direct lending space and in the private credit space generally.
+Added: Blackstone Credit has experience scaling funds across its platform that invest throughout all parts of the capital structure.
+Added: Blackstone Credit strives to focus on transactions where it can differentiate itself from other providers of capital, targeting larger transactions and those where Blackstone Credit can bring its expertise and experience in negotiating and structuring.
+Added: We believe that Blackstone Credit has the scale and platform to effectively manage a U.S.
+Added: private credit investment strategy, offering investors the following potential strengths:
+Added: Ability to Provide Scale, Differentiated Capital Solutions .
+Added: We believe that the breadth and scale of Blackstone Credit’s approximately $145 billion platform, as of December 31, 2020, and affiliation with Blackstone are distinct strengths when sourcing proprietary investment opportunities and provide Blackstone Credit with a differentiated capability to invest in large, complex opportunities.
+Added: Blackstone Credit is invested in over 1,000 corporate issuers across its portfolios globally and has focused primarily on the non-investment grade corporate credit market since its inception in 2005.
+Added: Blackstone Credit expects that in the current environment, in which committed capital from banks remains scarce (as tracked by S&P Capital IQ LCD, U.S.
+Added: banks’ share of senior secured debt to middle market companies represented 12% of the overall middle market loan volume in 2019, down from nearly 20% in 2011), the ability to provide flexible, well-structured capital commitments in appropriate sizes will enable Blackstone Credit to command more favorable terms for its investments.
+Added: Blackstone Credit believes that it occupies a differentiated position in the leveraged finance market, with investment activities that span a broad array of public and private market strategies.
+Added: We believe this presence enables Blackstone Credit to identify opportunities early and select those investments that Blackstone Credit believes offer the most attractive risk-adjusted return profile.
+Added: In addition, when banks are facing difficulties in syndicating new issues, Blackstone Credit’s ability to serve as a large “anchor” investor can help facilitate the successful completion of a transaction.
+Added: We believe the depth of the experience of Blackstone Credit’s senior management team, together with the wider resources of Blackstone Credit’s team of investment professionals (the “ Investment Team ”), which is dedicated to sourcing, structuring, executing, monitoring and harvesting a broad range of private investments, is one of Blackstone Credit's key strengths when sourcing and analyzing what we believe to be attractive investment opportunities.
+Added: Established Origination Platform with Strong Credit Expertise .
+Added: As of January 1, 2021 , Blackstone Credit had an 82 pe rson U.S.
+Added: Direct Lending Investments and Portfolio Management Team (excluding Dwight Scott, a member of Blackstone Credit's senior management) focused on the sourcing, structuring, execution, management and realization of performing credit investments (which includes those professionals who focus primarily on direct lending investments).
+Added: Performing credit investments are credit investments whose obligors are able to timely and fully pay interest on their outstanding debt, and are not financially stressed or distressed, or considered to be at substantial risk of being financially stressed or distressed, at the time of investment.
+Added: We believe that Blackstone Credit’s strong reputation and longstanding relationships with corporate boards, management teams, leveraged buyout sponsors, financial advisors, and intermediaries position Blackstone Credit as a partner and counterparty of choice and provides us with attractive sourcing capabilities.
+Added: In Blackstone Credit’s experience, these relationships help drive substantial proprietary deal flow and insight into investment opportunities.
+Added: Value-Added Capital Provider and Partner Leveraging the Blackstone Credit Advantage Program.
+Added: Blackstone Credit has established a reputation fo r providing creative, value-added solutions to address a company’s financing requirements and believes our ability to “solve a problem” for a company can lead to attractive investment opportunities.
+Added: In addition, Blackstone Credit has access to the significant resources of the Blackstone platform, including the Blackstone Credit Advantage Program, which is a global platform that provides access to a range of cost saving, revenue generating and best practice sharing opportunities.
+Added: Specifically, Blackstone Credit Advantage provides (i) partnership and best practices for portfolio companies by offering invaluable access to industry and function experts both within the Blackstone organization (including the Blackstone Portfolio Operations team) and the network among portfolio companies;
+Added: (ii) cross selling opportunities across Blackstone and Blackstone Credit portfolio companies;
+Added: (iii) industry knowledge via leadership summits and roundtables;
+Added: and (iv) quarterly reports sharing meaningful insights from CEOs on business and economic trends.
+Added: Finally, one of the most important benefits of the program is Blackstone’s GPO, which is a collective purchasing platform that leverages the scale and buying power of the $5 billion of average annual spending of Blackstone’s portfolio companies with strategic partners and vendors measured over the past ten years.
+Added: Blackstone and Blackstone Credit portfolio companies have generated significant cost savings through their use of the GPO, ranging from 3% to 40%, often from existing suppliers, on maintenance, repair, operations, back office, information technology, hardware, software, telecommunications, business insurance and human resources, among others.
+Added: benefits of working with Blackstone’s GPO can include improved pricing and terms, differentiated service, and ongoing service drops straight to the bottom line.
+Added: Blackstone Credit seeks to generate investment opportunities through its direct origination channels and through syndicate and club deals (generally, investments made by a small group of investment firms).
+Added: With respect to Blackstone Credit’s origination channel, we seek to leverage the global presence of Blackstone Credit to generate access to a substantial amount of directly originated transactions with attractive investment characteristics.
+Added: We believe that the broad network of Blackstone Credit provides a significant pipeline of investment opportunities for us.
+Added: With respect to syndicate and club deals, Blackstone Credit has built a network of relationships with commercial and investment banks, finance companies and other investment funds as a result of the long track record of its investment professionals in the leveraged finance marketplace.
+Added: Blackstone Credit also has a significant trading platform, which, we believe, allows us access to the secondary market for investment opportunities.
Flexible Investment Approach .
−Removed: GSO believes that the ability to invest opportunistically throughout a capital structure provides a meaningful competitive advantage in sourcing transactions and enables the Company to seek investments that provide the best risk/return proposition in any given transaction.
−Removed: GSO’s creativity and flexibility with regard to deal-structuring distinguishes it from other financing sources, including traditional mezzanine providers, whose investment mandates are typically more restrictive.
−Removed: Over time, GSO has demonstrated the ability to negotiate more favorable terms for its investments by providing creative structures that add value for an issuer.
−Removed: GSO will continue to seek to use this flexible investment approach to focus on principal preservation, while generating attractive returns throughout different economic and market cycles.
+Added: Blackstone Credit believes that the ability to invest opportunistically throughout a capital structure is a meaningful strength when sourcing transactions and enables the Company to seek investments that provide the best risk/return proposition in any given transaction.
+Added: Blackstone Credit’s creativity and flexibility with regard to deal-structuring distinguishes it from other financing sources, including traditional mezzanine providers, whose investment mandates are typically more restrictive.
+Added: Over time, Blackstone Credit has demonstrated the ability to negotiate more favorable terms for its investments by providing creative structures that add value for an issuer.
+Added: Blackstone Credit will continue to seek to use this flexible investment approach to focus on principal preservation, while generating attractive returns throughout different economic and market cycles.
Long-Term Investment Horizon .
−Removed: Our long-term investment horizon gives us greater flexibility, which we believe allows us to maximize returns on our investments.
+Added: Our long-term investment horizon gives us great flexibility, which we believe allows us to maximize returns on our investments.
Unlike most private equity and venture capital funds, as well as many private debt funds, we will not be required to return capital to our shareholders once we exit a portfolio investment.
−Removed: We believe that freedom from such capital return requirements, which allows us to invest using a longer-term focus, provides us with a better opportunity to increase total returns on invested capital compared to other private company investment vehicles.
+Added: We believe that freedom from such capital return requirements, which allows us to invest using a long-term focus, provides us with an attractive opportunity to increase total returns on invested capital.
Disciplined Investment Process and Income-Oriented Investment Philosophy .
−Removed: GSO employs a rigorous investment process and defensive investment approach to evaluate all potential opportunities with a focus on long-term credit performance and principal protection.
−Removed: We believe GSO has generated attractive risk-adjusted returns in its investing activities throughout many economic and credit cycles by (i) maintaining its investment discipline;
+Added: Blackstone Credit employs a rigorous investment process and defensive investment approach to evaluate all potential opportunities with a focus on long-term credit performance and principal protection.
+Added: We believe Blackstone Credit has generated attractive risk-adjusted returns in its investing activities throughout many economic and credit cycles by (i) maintaining its investment discipline;
(ii) performing intensive credit work;
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and (iv) actively managing its portfolios.
−Removed: GSO’s investment approach involves a multi-stage selection process for each investment opportunity, as well as ongoing monitoring of each investment made, with particular emphasis on early detection of deteriorating credit conditions at portfolio companies which would result in adverse portfolio developments.
+Added: Blackstone Credit’s investment approach involves a multi-stage selection process for each investment opportunity, as well as ongoing monitoring of each investment made, with particular emphasis on early detection of deteriorating credit conditions at portfolio companies which would result in adverse portfolio developments.
This strategy is designed to maximize current income and minimize the risk of capital loss while maintaining the potential for long-term capital appreciation.
−Removed: Additionally, GSO’s senior investment professionals have dedicated their careers to the leveraged finance and private equity sectors and we believe that their experience in due diligence, credit analysis and ongoing management of investments is invaluable to the success of the U.S.
+Added: Additionally, Blackstone Credit’s senior investment professionals have dedicated their careers to the leveraged finance and private equity sectors and we believe that their experience in due diligence, credit analysis and ongoing management of investments is invaluable to the success of the U.S.
direct lending investment strategy that we will employ.
−Removed: GSO targets businesses with leading market share positions, sustainable barriers to entry, high free cash flow generation, strong asset values, liquidity to withstand market cycles, favorable underlying industry trends, strong internal controls and high-quality management teams.
−Removed: Ability to Leverage Blackstone’s Group Purchasing Organization
−Removed: Blackstone’s Group Purchasing Organization (“ GPO ”) is a collective purchasing platform that leverages the scale and buying power of the $5 billion of average annual spending of Blackstone’s portfolio companies with strategic partners and vendors measured over the past ten years.
−Removed: Blackstone and GSO portfolio companies have generated significant cost savings through their use of the GPO, ranging from 3% to 40%, often from existing suppliers, on maintenance, repair, operations, back office, information technology, hardware, software, telecommunications, business insurance and human resources, among others.
−Removed: The benefits of working with Blackstone’s GPO can include improved pricing and terms, differentiated service, and ongoing service that may benefit the applicable portfolio company’s performance.
+Added: Blackstone Credit targets businesses with leading market share positions, sustainable barriers to entry, high free cash flow generation, strong asset values, liquidity to withstand market cycles, favorable underlying industry trends, strong internal controls and high-quality management teams.
+Added: Strong Investment Track Record.
+Added: Blackstone Credit’s track record in private debt lending and investing in below investment grade credit dates back to the inception of Blackstone Credit.
+Added: Since 2005, Blackstone Credit has provided approximately $69 billion in capital in privately-originated transactions with over 120 different sponsors, through various funds and accounts advised or sub-advised by Blackstone Credit.
+Added: As it relates to the U.S.
+Added: direct lending strategy, Blackstone Credit has been originating in the strategy since inception, and has invested approximately $28 billion of capital specifically in U.S.
+Added: middle market privately originated and anchor loans.
+Added: Blackstone Credit has approximately $97 billion of investor capital invested.
Investment Strategy
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We seek to meet our investment objectives by:
−Removed: • utilizing the experience and expertise of the management team of the Adviser, along with the broader resources of GSO, which include its access to the relationships and human capital of GSO’s parent, Blackstone, in sourcing, evaluating and structuring transactions, subject to Blackstone’s policies and procedures regarding the management of conflicts of interest;
+Added: • utilizing the experience and expertise of the management team of the Adviser, along with the broader resources of Blackstone Credit, which include its access to the relationships and human capital of Blackstone
+Added: Credit’s parent, Blackstone, in sourcing, evaluating and structuring transactions, subject to Blackstone’s policies and procedures regarding the management of conflicts of interest;
• employing a defensive investment approach focused on long-term credit performance and principal protection, generally lending on a basis of 3.5 times to 5.5 times the borrower’s earnings before interest, taxes, depreciation and amortization (“ EBITDA ”) (which is generally measured on a forward basis using estimated projections of the Adviser and may include certain adjustments) and at loan-to-value ratios of 50%-65% (with value being the Adviser’s estimate of enterprise value of the borrower) and also seeking favorable financial covenant protections.
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Under normal market conditions, we generally invest at least 80% of our total assets (net assets plus borrowings for investment purposes) in secured debt investments (including investments that are secured by equity interests).
−Removed: Our portfolio is
−Removed: composed primarily of first lien senior secured and unitranche loans (including first out/last out loans), generally with total investment sizes less than $300 million, which criteria may change from time to time.
+Added: Our portfolio is composed primarily of first lien senior secured and unitranche loans (including first out/last out loans), generally with total investment sizes less than $300 million, which criteria may change from time to time.
To a lesser extent, we have and may continue to also invest in second lien, third lien, unsecured or subordinated loans, generally with total investment sizes less than $100 million, which criteria may change from time to time, and other debt and equity securities.
We do not currently focus on investments in issuers that are distressed or in need of rescue financing.
−Removed: Subject to the limitations of the 1940 Act, we may invest in loans or other securities the proceeds of which may refinance or otherwise repay debt or securities of companies whose debt is owned by other GSO funds.
+Added: Subject to the limitations of the 1940 Act, we may invest in loans or other securities the proceeds of which may refinance or otherwise repay debt or securities of companies whose debt is owned by other Blackstone Credit funds.
Although we do not expect a significant portion of our portfolio to be composed of second lien, third lien, unsecured or subordinated loans, there is no limit on the amount of such loans in which we may invest, subject to compliance with our 80% policy.
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The Adviser will seek companies that it believes possess advantages in scale, scope, customer loyalty, product pricing, or product quality versus their competitors, thereby minimizing business risk and protecting profitability.
−Removed: Stable Companies with Positive Cash Flows.
+Added: Stable Companies with Positive Cash Flow.
The Adviser intends to invest in established, stable companies which have demonstrated a record of profitability and cash flows over several economic cycles.
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Proven Management Teams.
−Removed: The Adviser intends to focus on investments in which the target company has an experienced and high-quality management team with an established track record of success.
−Removed: The Adviser will typically require companies to have in place proper incentives to align management’s goals with the Company’s goals.
+Added: The Adviser focuses on investments in which the target company has an experienced and high-quality management team with an established track record of success.
+Added: The Adviser typically requires companies to have in place proper incentives to align management’s goals with the Company’s goals.
Private Equity Sponsorship.
−Removed: Often the Adviser will seek to participate in transactions sponsored by what it believes to be high-quality private equity firms.
+Added: Often the Adviser seeks to participate in transactions sponsored by what it believes to be high-quality private equity firms.
The Adviser believes that a private equity sponsor’s willingness to invest significant sums of equity capital into a company is an implicit endorsement of the quality of the investment.
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In addition to payments of principal and interest, we expect the primary methods for the strategy to realize returns on our investments include refinancings, sales of portfolio companies, and in some cases initial public offerings and secondary offerings.
−Removed: While many debt securities in which we will invest have stated maturities of five to eight years, based on GSO’s past experience, we believe most of these securities will be redeemed or sold prior to maturity.
−Removed: These securities often have call protection that requires an issuer to pay a premium if it redeems in the early years of an investment.
−Removed: The Investment Team regularly reviews investments and related market conditions in order to determine if an opportunity exists
−Removed: to realize returns on a particular investment.
−Removed: We believe the Adviser’s ability to utilize the entire resources of GSO, including the public market traders and research analysts, allows the Adviser to gain access to current market information where the opportunity may exist to sell positions into the market at attractive prices.
−Removed: Investment Process
+Added: While many debt instruments in which we will invest have stated maturities of five to eight years, we expect the majority to be redeemed or sold prior to maturity.
+Added: These instruments often have call protection that requires an issuer to pay a premium if it redeems in the early years of an investment.
+Added: The Investment Team regularly reviews investments and related market conditions in order to determine if an opportunity exists to realize returns on a particular investment.
+Added: We believe the ability to utilize the entire resources of Blackstone Credit, including the public market traders and research analysts, allows the Adviser to gain access to current market information where the opportunity may exist to sell positions into the market at attractive prices.
+Added: Investment Process Overview
Our investment activities are managed by our Adviser.
The Adviser is responsible for originating prospective investments, conducting research and due diligence investigations on potential investments, analyzing investment opportunities, negotiating and structuring our investments and monitoring our investments and portfolio companies on an ongoing basis.
−Removed: The investment professionals employed by GSO have spent their careers developing the resources necessary to invest in private companies.
+Added: The investment professionals employed by Blackstone Credit have spent their careers developing the resources necessary to invest in private companies.
Our transaction process is highlighted below.
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The Adviser seeks to generate investment opportunities primarily through direct origination channels, and also through syndicate and club deals.
−Removed: With respect to GSO’s origination channel, the global presence of GSO generates access to a substantial amount of directly originated transactions with what we believe to be attractive investment characteristics.
−Removed: With respect to syndicate and club deals, GSO has built a network of relationships with commercial and investment banks, finance companies and other investment funds as a result of the long track record of its investment professionals in the leveraged finance marketplace.
−Removed: We believe that GSO’s strong reputation and longstanding relationships with its broad network will help drive substantial proprietary deal flow and provide a significant pipeline of investment opportunities for us.
+Added: With respect to Blackstone Credit’s origination channel, the global presence of Blackstone Credit generates access to a substantial amount of directly originated transactions with what we believe to be attractive investment characteristics.
+Added: With respect to syndicate and club deals, Blackstone Credit has built a network of relationships with commercial and investment banks, finance companies and other investment funds as a result of the long track record of its investment professionals in the leveraged finance marketplace.
+Added: We believe that Blackstone Credit’s strong reputation and longstanding relationships with its broad network will help drive substantial proprietary deal flow and provide a significant pipeline of investment opportunities for us.
Initial Review .
−Removed: The Investment Team examines information furnished by the target company and external sources, including banks, advisors and rating agencies, if applicable, to determine whether the investment meets our basic investment criteria within the context of proper allocation of our portfolio among various issuers and industries, and offers an acceptable probability of attractive returns with identifiable downside risk.
−Removed: In the case of directly originated transactions, GSO conducts detailed due diligence investigations.
−Removed: For the majority of securities available on the secondary market, a comprehensive analysis is conducted and continuously maintained by a dedicated GSO research analyst, the results of which are available for the transaction team to review.
+Added: The Investment Team examines information furnished by the target company and external sources, including banks, advisors and rating agencies, if applicable, to determine whether the investment meets our basic investment criteria within the context of proper allocation of our portfolio among various issuers and industries, and offers an acceptable
+Added: probability of attractive returns with identifiable downside risk.
+Added: In the case of directly originated transactions, Blackstone Credit conducts detailed due diligence investigations.
+Added: For the majority of securities available on the secondary market, a comprehensive analysis is conducted and continuously maintained by a dedicated Blackstone Credit research analyst, the results of which are available for the transaction team to review.
Credit Analysis/Due Diligence .
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Third parties are often involved in the Adviser’s due diligence process, whether they are hired by the Adviser or by the lead sponsor in a transaction.
−Removed: Utilizing consultants to help evaluate a business and test an investment thesis is typically very
+Added: Utilizing consultants to help evaluate a business and test an investment thesis is typically very beneficial.
When possible, the Adviser seeks to structure transactions in such a way that our target companies are required to bear the costs of due diligence, including those costs related to any outside consulting work we may require.
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A thorough assessment of structure and leverage of a transaction and how the particular investment fits into the overall investment strategy of the portfolio is conducted.
−Removed: GSO’s typical diligence process for an originated investment opportunity spans two to six months, from the initial screen through final approval and funding.
−Removed: Depending on the deal, each deal team typically consists of three to four investment professionals, consisting of a portfolio manager, managing director, principal or vice president and associate and/or analyst.
+Added: Blackstone Credit’s typical diligence process for an originated investment opportunity spans two to six months, from the initial screen through final approval and funding.
+Added: Depending on the deal, each investment team typically consists of three to four investment professionals, consisting of a portfolio manager, managing director, principal or vice president and associate and/or analyst.
+Added: Blackstone Credit’s due diligence emphasizes the following key criteria to facilitate decisions by the Investment Committee (described below) on an investment:
+Added: What is the intrinsic value of the business?
+Added: How has the business historically generated returns on capital?
+Added: Will these returns continue in the future?
+Added: What growth opportunities does the business have, if any?
+Added: And, most importantly, is the investment being purchased at a deep discount to long-term intrinsic value?
+Added: • Return Hurdles :
+Added: Is the investment expected to generate a rate of return that meets the Company's objectives?
+Added: • Risk of Principal Loss & Risk/Reward :
+Added: What is the expected recovery in a severe downside case?
+Added: Does the expected upside appropriately compensate for risk of loss?
+Added: • Company Analysis :
+Added: Does the business have a reason to exist?
+Added: Does it provide needed products and services?
+Added: Does it have strong business characteristics such as high relative market share and a defensible niche?
+Added: • Industry Analysis :
+Added: What is the expected time and depth of cyclical downturn?
+Added: Is the distress related to cyclical or secular issues?
+Added: Is there a favorable industry structure with respect to customers, suppliers and regulation?
+Added: • Due Diligence :
+Added: Do we have sufficient information to make an informed investment decision?
+Added: What steps are required to complete a reorganization, eliminate financial distress, gain control and implement improved business strategies?
+Added: • Exit Plan :
+Added: Do we expect refinancings, a sale of the company, or other exit opportunities?
Investment Committee Process .
The Investment Committee review process is multi-step and iterative, and occurs in parallel with the diligence and structuring of investments.
−Removed: The initial investment screening process involves an Investment Committee “Heads-Up” review presentation by the portfolio manager and members of the deal team.
+Added: The initial investment screening process involves an Investment Committee heads-up (the “ Heads-Up ”) review presentation by the portfolio manager and members of the investment team.
The Heads-Up review involves the production of a short memo with a focus on the following diligence items:
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At this point in the decision-making process, the Investment Committee will decide whether or not the Investment Team should proceed with deeper diligence on the investment opportunity.
−Removed: Once in-depth diligence has begun, the deal team presents updates at regularly-held Investment Committee meetings.
−Removed: The senior team reviews all activity for the prior meeting, with a focus on detailed updates of ongoing situations and in-depth review of all new investment opportunities.
+Added: Once in-depth diligence has begun, the investment team presents updates at the weekly Investment Committee meetings.
+Added: The senior team reviews all activity for the prior week, with a focus on detailed updates of ongoing situations and in-depth review of all new investment opportunities.
The type of diligence materials reviewed at these meetings for each company may include, but are not limited to:
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• Company Analysis:
−Removed: Does the company meet the investment criteria defined by the “GSO Scorecard”?:
+Added: Does the company meet the investment criteria defined by the “Blackstone Credit Scorecard”?:
◦ Leading market share position
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◦ Stable financials:
−Removed: strong free cash flow generation, high EBIT margins
+Added: strong free cash flow generation, high earnings before interest and tax margins
◦ Conservative capital structure with underlying equity value
3 unchanged sentences
• Due Diligence:
−Removed: Have we fully diligence each of the investment criteria specified by the GSO Scorecard?
+Added: Have we fully diligenced each of the investment criteria specified by the Blackstone Credit Scorecard?
Have we completely vetted each of the risk factors identified throughout the diligence and Investment Committee process?
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Do we expect refinancings, a sale of the company, or other exit opportunities?
+Added: The Investment Committee utilizes a consensus-driven approach and currently consists of the following senior investment professionals:
+Added: Dwight Scott, Brad Marshall, Steve Kuppenheimer, Rob Zable, Michael Zawadzki, Dan Smith, Rob Horn, Rob Petrini, Louis Salvatore and Paulo Eapen.
+Added: Others who participate in the Investment Committee process include the members of the Investment Team responsible for sourcing, analyzing and conducting due diligence on the investment and other senior members of Blackstone Credit.
+Added: There are no representatives from other business groups of Blackstone involved in the Company’s Investment Committee process.
Portfolio Monitoring .
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In addition, depending on the size, nature and performance of the transaction, we may occupy a seat or serve as an observer on a portfolio company’s board of directors or similar governing body.
+Added: Typically for its portfolio companies, Blackstone Credit establishes at closing a number of reporting and management tools.
+Added: These tools include regular reporting on portfolio composition and reporting, calls with CEOs and detailed reports and calls with senior management on a regular basis, and quarterly in-person board meetings and board presentations.
+Added: All reports and presentations are designed with Blackstone Credit input based on its past experience with private investments.
+Added: These tools allow Blackstone Credit to identify problems quickly and work to fix them before they impair an investment.
+Added: In addition, Blackstone Credit maintains a “watch list” for each business under-performing its expectations.
+Added: Blackstone Credit seeks to approach each situation with the view that working closely with senior management and the shareholders of the company on strategies to remedy problems will ultimately maximize value realization.
+Added: When, in order to maximize our recovery, Blackstone Credit is forced to take positions inconsistent with the company’s shareholders, Blackstone Credit expects to act quickly to enforce its rights.
+Added: Blackstone Credit strives to position itself to be able to identify and manage the process surrounding a troubled portfolio company.
+Added: When companies under-perform, Blackstone Credit generally increases its involvement in the business and works closely with senior management to develop plans to help get performance on track.
+Added: Blackstone Credit will request more information and will enhance our information quality so that we are aware of any developments.
+Added: Blackstone Credit’s Investment Committee process is designed to identify red flags of a potential opportunity early and to leverage the collective knowledge of its prior experiences.
+Added: Blackstone Credit believes that vetting all investments through its Investment Committee, which has deep expertise across industries, differentiates Blackstone Credit and can help it avoid mistakes.
+Added: Additionally, Blackstone Credit may provide guidance on key management hires or supplement the portfolio company’s board with relevant industry people that Blackstone Credit has worked with previously to engage more deeply in the operations of a portfolio company.
+Added: Additionally, the GPO team can be leveraged to help reduce costs and augment key leadership positions.
+Added: Default/Workout .
+Added: An important element of Blackstone Credit’s strategy is to attempt to structure investments in a manner such that Blackstone Credit will control negotiations should an issuer violate covenants or need to restructure its balance sheet.
+Added: Blackstone Credit believes that this is typically achieved by ensuring that an investment is at or above the “fulcrum” security, if a restructuring were to occur.
+Added: A fulcrum security is the security in a company’s capital structure that, if the company were to be liquidated, would be partially repaid.
+Added: Generally, securities more senior than the fulcrum security would typically be fully repaid in such a liquidation and securities more junior than the fulcrum security would typically receive no recovery in a liquidation.
+Added: If an investment should default, Blackstone Credit believes it has ample resources necessary to take a company through a restructuring, as many of its investment professionals have restructuring backgrounds.
+Added: The Blackstone Credit deal team, along with other creditors and outside counsel, will be responsible for monitoring any defaulting portfolio companies and driving the restructuring processes thereafter.
+Added: The same Investment Team members who originate an investment remain actively involved, from sourcing through diligence, execution and ongoing management all the way to exit.
+Added: In the case that an investment requires a heavy workout that results in a board seat and more operational involvement, Blackstone Credit may dedicate or add a senior investment professional to solely focus on the workout situation.
+Added: This individual will get involved and run the full workout process to allow the other deal team members to focus on new origination and other portfolio companies.
+Added: Any investment undergoing a workout will also be discussed with portfolio management and the Investment Committee on a regular basis.
+Added: Valuation Process .
+Added: Each quarter, we will value investments in our portfolio, and such values will be disclosed each quarter in reports filed with the SEC.
+Added: With respect to investments for which market quotations are not readily available, a valuation committee appointed by the Board of Trustees will assist the Board of Trustees in determining the fair value of such investments in good faith, based on procedures adopted by and subject to the supervision of the Board of Trustees.
+Added: We will also determine our NAV as of the last day of a month that is not also the last day of a calendar quarter and we intend to update the value of securities with reliable market quotations to the most recent market quotation.
+Added: For securities without reliable market quotations, the Adviser’s valuation team will generally value such assets at the most recent quarterly valuation unless the Adviser determines that a significant observable change has occurred since the most recent quarter end with respect to the investment (which determination may be as a result of a material event at a portfolio company, material change in market spreads, secondary market transaction in the securities of an investment or otherwise).
+Added: Investments for which market quotations are readily available are recorded at such market quotations.
+Added: Managerial Assistance .
+Added: As a BDC, we must offer, and provide upon request, significant managerial assistance to certain of our portfolio companies except where the Company purchases securities of an issuer in conjunction with one or more other persons acting together, one of the other persons in the group makes available such managerial assistance.
+Added: This assistance could involve, among other things, monitoring the operations of our portfolio companies, participating in board and management meetings, consulting with and advising officers of portfolio companies and providing other organizational and financial guidance, including through the Blackstone Credit Advantage program.
+Added: The Adviser and the Administrator will provide such managerial assistance on our behalf to portfolio companies that request this assistance.
+Added: To the extent fees are paid for these services, we, rather than the Adviser, will retain any fees paid for such assistance.
In addition to payments of principal and interest, we expect the primary methods for the strategy to realize returns on its investments include refinancings, sales of portfolio companies, and in some cases initial public offerings and secondary offerings.
−Removed: While many debt securities in which we will invest have stated maturities of five to eight years, based on GSO’s past experience, we believe most of these securities will be redeemed or sold prior to maturity.
+Added: While many debt securities in which we will invest have stated maturities of five to eight years, based on Blackstone Credit’s past experience, we believe most of these securities will be redeemed or sold prior to maturity.
These securities often have call protection that requires an issuer to pay a premium if it redeems in the early years of an investment.
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The Investment Team regularly reviews investments and related market conditions in order to determine if an opportunity exists to realize returns on a particular investment.
−Removed: We believe the Adviser’s ability to utilize the entire resources of GSO, including the public market traders and research analysts, allows the Adviser to gain access to current market information where the opportunity may exist to sell positions into the market at attractive prices.
+Added: We believe the Adviser’s ability to utilize the entire resources of Blackstone Credit, including the public market traders and research analysts, allows the Adviser to gain access to current market information where the opportunity may exist to sell positions into the market at attractive prices.
Allocation of Investment Opportunities and Potential Conflicts of Interest
−Removed: GSO, including the Adviser, provides investment management services to other registered investment companies, investment funds, client accounts and proprietary accounts that GSO may establish (other than the Company) (collectively the “ Other GSO Clients ”).
−Removed: In addition, Blackstone provides investment management services to other registered investment companies, investment funds, client accounts and proprietary accounts that Blackstone may establish (together with the Other GSO Clients, the “ Other Clients ”).
+Added: Blackstone Credit, including the Adviser, provides investment management services to other registered investment companies, investment funds, client accounts and proprietary accounts that Blackstone Credit may establish (other than the Company) (collectively the “ Other Blackstone Credit Clients ”).
+Added: In addition, Blackstone provides investment management services to other registered investment companies, investment funds, client accounts and proprietary accounts that Blackstone may establish (together with the Other Blackstone Credit Clients, the “ Other Clients ”).
See “ Item 1A.
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Conflicts of Interest — There may be conflicts of interest related to obligations that the Adviser’s senior management and Investment Team have to other clients.”
+Added: Blackstone Credit will share any investment and sale opportunities with its other clients and the Company in accordance with the Advisers Act and firm-wide allocation policies, which generally provide for sharing pro rata based on targeted acquisition size or targeted sale size.
+Added: Subject to the Advisers Act and as further set forth in the prospectus, certain other clients may receive certain priority or other allocation rights with respect to certain investments, subject to various conditions set forth in such other clients’ respective governing agreements.
+Added: In addition, as a BDC regulated under the 1940 Act, the Company is subject to certain limitations relating to co-investments and joint transactions with affiliates, which likely in certain circumstances limit the Company’s ability to make investments or enter into other transactions alongside other clients.
Co-Investment Relief
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We have received an exemptive order from the Securities and Exchange Commission (“SEC”) that permits us, among other things, to co-invest with certain other persons, including certain affiliates of the Adviser and certain funds managed and controlled by the Adviser and its affiliates, subject to certain terms and conditions.
−Removed: Pursuant to such order, the board of trustees of the Company (the “ Board ”) has established objective criteria (“ Board Criteria ”) clearly defining co-investment opportunities in which the Company will have the opportunity to participate with one or more listed or private GSO-managed BDCs (including the Company, the “ GSO BDCs ”), and other public or private GSO funds that target similar assets.
−Removed: If an investment falls within the Board Criteria, GSO must offer an opportunity for the GSO BDCs to participate.
−Removed: The GSO BDCs may determine to participate or not to participate, depending on whether GSO determines that the investment is appropriate for the GSO BDCs (e.g., based on investment strategy).
−Removed: The co-investment would generally be allocated to us, any other GSO BDCs and the other GSO funds that target similar assets pro rata based on available capital in the applicable asset class.
+Added: Pursuant to such order, the board of trustees of the Company (the “ Board ”) has established objective criteria (“ Board Criteria ”) clearly defining co-investment opportunities in which the Company will have the opportunity to participate with one or more listed or private Blackstone Credit-managed BDCs (including the Company, the “ Blackstone Credit BDCs ”), and other public or private Blackstone Credit funds that target similar assets.
+Added: If an investment falls within the Board Criteria, Blackstone Credit must offer an opportunity for the Blackstone Credit BDCs to participate.
+Added: The Blackstone Credit BDCs may determine to participate or not to participate, depending on whether Blackstone Credit determines that the investment is appropriate for the Blackstone Credit BDCs (e.g., based on investment strategy).
+Added: The co-investment would generally be allocated to us, any other Blackstone Credit BDCs and the other Blackstone Credit funds that target similar assets pro rata based on available capital in the applicable asset class.
If the Adviser determines that such investment is not appropriate for us, the investment will not be allocated to us, but the Adviser will be required to report such investment and the rationale for its determination for us to not participate in the investment to the Board at the next quarterly board meeting.
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Second lien debt 48,979 50,199 0.90 32,782 32,419 1.05
−Removed: Equity Investments 13,487 13,920 0.45 — — —
+Added: Equity 32,942 32,844 0.59 13,487 13,920 0.45
Total $ 5,575,482 $ 5,585,942 100.00 % $ 3,067,767 $ 3,092,440 100.00 %
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Construction & Engineering 1.07 4.44
−Removed: Containers & Packaging — 0.34
Distributors 8.10 18.51
−Removed: Diversified Consumer Services — 1.98
Diversified Financial Services 1.08 2.51
−Removed: Diversified Telecommunication Services — 0.88
+Added: Electrical Equipment 2.61 —
Electronic Equipment, Instruments & Components 2.19 0.46
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Machinery 0.95 1.63
−Removed: Media 0.95 2.88
Oil, Gas & Consumable Fuels 2.66 4.81
+Added: Paper & Forest Products 0.26 —
+Added: Personal Products 0.96 —
Professional Services 2.32 1.76
−Removed: Real Estate Management & Development — 0.90
Software 2.94 3.03
9 unchanged sentences
Canada 267,544 270,126 4.84 8.27
−Removed: Luxembourg 130,113 130,464 4.22 7.80
+Added: Germany 102,106 106,678 1.91 3.26
Total $ 5,575,482 $ 5,585,942 100.00 % 170.94 %
4 unchanged sentences
United States $ 2,675,743 $ 2,698,272 87.25 % 161.27 %
−Removed: United Kingdom 5,862 5,784 1.06 2.45
+Added: Canada 261,911 263,704 8.53 15.76
+Added: Luxembourg 130,113 130,464 4.22 7.80
Total $ 3,067,767 $ 3,092,440 100.00 % 184.83 %
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In addition, we must also comply with positive and negative covenants customary for these types of facilities.
−Removed: Our contractual obligations consisted of the following as of December 31, 2019 (dollar amounts in thousands):
−Removed: Payments Due by Period
−Removed: Total Less than
−Removed: 1 year 1-3 years 3-5 years After 5 years
−Removed: Subscription Facility $ 119,752 $ 119,752 $ — $ — $ —
−Removed: Jackson Hole Funding Facility 514,151 — — 514,151 —
−Removed: Breckenridge Funding Facility 820,311 — — 820,311 —
−Removed: Big Sky Funding Facility — — — — —
−Removed: Total Contractual Obligations $ 1,454,214 $ 119,752 $ — $ 1,334,462 $ —
See “ Item 7.
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Pursuant to the Investment Advisory Agreement, we pay our Adviser a fee for investment advisory and management services consisting of two components—a management fee and an incentive fee.
+Added: The cost of both the management fee and the incentive fee will ultimately be borne by the shareholders.
Management Fee
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Pre-Incentive Fee Net Investment Income Returns do not include any realized capital gains, realized capital losses or unrealized capital appreciation or depreciation.
+Added: The Company excludes the impact of expense support payments and recoupments from pre-incentive fee net investment income.
Pre-Incentive Fee Net Investment Income Returns, expressed as a rate of return on the value of our net assets at the end of the immediately preceding quarter, is compared to a “ hurdle rate ” of return of 1.5% per quarter (6.0% annualized).
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For the avoidance of doubt, such capital gains incentive fee shall be equal to 15% of our realized capital gains on a cumulative basis from inception through the day before the Exchange Listing, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gains incentive fees.
−Removed: Solely for purposes of calculating the capital gains incentive fee after an
−Removed: Exchange Listing, the Company will be deemed to have previously paid capital gains incentive fees prior to an Exchange Listing equal to the product obtained by multiplying (a) the actual aggregate amount of previously paid capital gains incentive fees for all periods prior to an Exchange Listing by (b) the percentage obtained by dividing (x) 17.5% by (y) 15%.
+Added: Solely for purposes of calculating the capital gains incentive fee after an Exchange Listing, the Company will be deemed to have previously paid capital gains incentive fees prior to an Exchange Listing equal to the product obtained by multiplying (a) the actual aggregate amount of previously paid capital gains incentive fees for all periods prior to an Exchange Listing by (b) the percentage obtained by dividing (x) 17.5% by (y) 15%.
Each year, the fee paid for the capital gains incentive fee is net of the aggregate amount of any previously paid capital gains incentive fee for all prior periods.
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The Adviser and the Administrator shall not be liable under their respective agreements with us or otherwise for any loss due to the mistake, action, inaction, negligence, dishonesty, fraud or bad faith of any broker or other agent;
−Removed: provided, that such broker or other agent shall have been selected, engaged or retained and monitored by the Adviser or
−Removed: the Administrator in good faith, unless such action or inaction was made by reason of disabling conduct, or in the case of a criminal action or proceeding, where the Adviser or Administrator had reasonable cause to believe its conduct was unlawful.
+Added: provided, that such broker or other agent shall have been selected, engaged or retained and monitored by the Adviser or the Administrator in good faith, unless such action or inaction was made by reason of disabling conduct, or in the case of a criminal action or proceeding, where the Adviser or Administrator had reasonable cause to believe its conduct was unlawful.
Expense Support
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Such Expense Payment must be made in any combination of cash or other immediately available funds no later than forty-five days after a written commitment from the Adviser to pay such expense, and/or by an offset against amounts due from us to the Adviser or its affiliates.
−Removed: Following any calendar quarter in which Available Operating Funds (as defined in the Expense Support Agreement) exceed the cumulative distributions accrued to our shareholders based on distributions declared with respect to record dates occurring in such calendar quarter (such amount referred to as the “ Excess Operating Funds ”), we shall pay such Excess Operating Funds, or a portion thereof (each, a “ Reimbursement Payment ”), 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 calendar quarter have been reimbursed.
+Added: Following any calendar quarter in which Available Operating Funds (as defined in the Expense Support Agreement) exceed the cumulative distributions accrued to our shareholders based on distributions declared with respect to record dates occurring in such calendar quarter (such amount referred to as the “ Excess Operating Funds ”), we shall pay such Excess Operating Funds, or a portion thereof (each, a
+Added: “ Reimbursement Payment ”), 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 calendar quarter have been reimbursed.
The amount of the Reimbursement Payment for any calendar quarter shall equal the lesser of (i) the Excess Operating Funds in 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 calendar quarter that have not been previously reimbursed by us to the Adviser.
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Shareholders can elect to “opt out” of the Company’s dividend reinvestment plan in their Subscription Agreements.
−Removed: A shareholder may elect to receive its entire dividend in cash at any time by notifying the Company’s transfer
−Removed: agent in writing.
+Added: A shareholder may elect to receive its entire dividend in cash at any time by notifying the Company’s transfer agent in writing.
If, however, a shareholder requests to change its election within 95 days prior to a distribution, the request will be effective only with respect to distributions after the 95-day period.
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persons” (as defined in Regulation S under the 1933 Act), in reliance on exemptions from the registration requirements of the 1933 Act.
−Removed: Shares will be offered for subscription continuously throughout the period during which the Private Offering remains open.
+Added: Shares will be offered for subscription continuously throughout the period
+Added: during which the Private Offering remains open.
Shares will be offered for subscription continuously throughout the Initial Closing Period (as defined below) and may be offered from time to time thereafter.
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Investors will be required to fund drawdowns to purchase our shares up to the amount of their respective Capital Commitments on an as-needed basis each time we deliver a notice to the investors.
−Removed: We expect closings of the Private Offering will occur, from time to time, in the Adviser’s sole discretion, during the two-year period following the initial closing of Capital Commitments (which initial closing took place on October 31, 2018) (the “ Initial Closing Period ”), but the Adviser may modify the Initial Closing Period if approved by the Board, which could extend the Initial Closing Period up to an additional year.
−Removed: We may accept and draw down Capital Commitments from investors throughout the Initial Closing Period.
+Added: We expect closings of the Private Offering will occur, from time to time, in the Adviser’s sole discretion, during the two-year period following the initial closing of Capital Commitments (which initial closing took place on October 31, 2018) (the “ Initial Closing Period ”).
+Added: On October 31, 2020, the Initial Closing Period ended.
After the Initial Closing Period, we may permit one or more additional closings (“ Subsequent Closings ”) as additional Capital Commitments are obtained.
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Each offering has been and will be subject to the limitations of Section 23(b) under the 1940 Act (which generally prohibits us from issuing shares at a price below the then-current NAV of the shares as determined within 48 hours, excluding Sundays and holidays, of such issuance (taking into account any investment valuation adjustments from the latest quarterly valuation date in accordance with the Company’s valuation policy), subject to certain exceptions).
−Removed: In order to more fairly allocate organizational and offering expenses among all shareholders, investors subscribing after the Initial Drawdown Date will be required to bear a pro rata portion of such expenses at the time of their first investment in the Company.
+Added: In order to more fairly allocate organizational expenses among all shareholders, investors subscribing after the Initial Drawdown Date will be required to bear a pro rata portion of such expenses at the time of their first investment in the Company.
The “ Initial Drawdown Period ” began when Initial Capital Commitments were made and will continue until the earlier of (i) an Exchange Listing (as defined below) and (ii) the two-year anniversary of the end of the Initial Closing Period.
−Removed: During the Initial Drawdown Period and any drawdown period applicable to Subsequent Capital Commitments, the Adviser
−Removed: may issue capital calls for any permitted Company purpose.
+Added: During the Initial Drawdown Period and any drawdown period applicable to Subsequent Capital Commitments, the Adviser may issue capital calls for any permitted Company purpose.
Subject to the share repurchase program described herein, the Company generally does not intend to return any drawn capital.
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The Board may also seek to change our form and/or jurisdiction of organization for other reasons.
−Removed: The Board may, at any time and in its discretion,
−Removed: cause us to merge with another BDC, private fund, separately managed account or another investment vehicle without shareholder approval, subject to the requirements of the 1940 Act.
+Added: The Board may, at any time and in its discretion, cause us to merge with another BDC, private fund, separately managed account or another investment vehicle without shareholder approval, subject to the requirements of the 1940 Act.
In the event of our liquidation, dissolution or winding up, each share would be entitled to share ratably in all of our assets that are legally available for distribution after we paid or otherwise provide for all debts and other liabilities and subject to any preferential rights of holders of our preferred shares, if any preferred shares are outstanding at such time.
For the purposes of this paragraph, a merger or consolidation of the Company with or into any other corporation or other entity, or a sale or conveyance of all or any part of our property or assets will not be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary.
−Removed: Emerging Growth Company
−Removed: We are and we will remain an “emerging growth company” as defined in the JOBS Act until the earlier of (a) the last day of the fiscal year (i) following the fifth anniversary of the completion of an Exchange Listing, (ii) in which we have total annual gross revenue of at least $1.07 billion, or (iii) in which we are deemed to be a large accelerated filer, which means the market value of our shares that is held by non-affiliates exceeds $700 million as of the date of our most recently completed second fiscal quarter, and (b) the date on which we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.
−Removed: For so long as we remain an “emerging growth company” we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 (“ Sarbanes-Oxley Act ”).
−Removed: We cannot predict if investors will find our shares less attractive because we may rely on some or all of these exemptions.
−Removed: If some investors find our shares less attractive as a result, there may be a less active trading market for our shares and our share price may be more volatile.
−Removed: In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the 1933 Act for complying with new or revised accounting standards.
−Removed: In other words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.
−Removed: We currently are and intend to continue taking advantage of such extended transition periods.
−Removed: We compete for investments with other BDCs and investment funds (including private equity funds, mezzanine funds and CLO funds), as well as traditional financial services companies such as commercial banks and other sources of funding.
+Added: We compete for investments with other BDCs and investment funds (including private equity funds, mezzanine funds, performing and other credit funds, and funds that invest in CLOs, structured notes, derivatives and other types of collateralized securities and structured products), as well as traditional financial services companies such as commercial banks and other sources of funding.
+Added: These other BDCs and investment funds might be reasonable investment alternatives to us and may be less costly or complex with fewer and/or different risks than we have.
Moreover, alternative investment vehicles, such as hedge funds, have begun to invest in areas in which they have not traditionally invested, including making investments in middle market private U.S.
−Removed: As a result of these new entrants, competition for investment opportunities in middle market private U.S.
+Added: As a result of these new entrants, competition for investment opportunities in middle market
companies may intensify.
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These characteristics could allow our competitors to consider a wider variety of investments, establish more relationships and offer better pricing and more flexible structuring than we are able to do.
−Removed: We may lose investment opportunities if we do not match our competitors’ pricing, terms and structure.
−Removed: If we are forced to match our competitors’ pricing, terms and structure, we may not be able to achieve acceptable returns on our investments or may bear substantial risk of capital loss.
+Added: We may lose investment opportunities if we do not match our competitors’ pricing, terms or structure.
+Added: If we are forced to match our competitors’ pricing, terms or structure, we may not be able to achieve acceptable returns on our investments or may bear substantial risk of capital loss.
A significant part of our competitive advantage stems from the fact that the market for investments in middle market private U.S.
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A significant increase in the number and/or the size of our competitors in this target market could force us to accept less attractive investment terms.
−Removed: Furthermore, many of our competitors are not subject to the regulatory restrictions that the 1940 Act imposes on us as a BDC.
+Added: Furthermore, many of our competitors have greater experience operating under, or are not subject to the regulatory restrictions that the 1940 Act imposes on us as a BDC.
For additional information concerning the competitive risks we face, see “ Item 1A.—Risk Factors—Risks Related To Our Business And Structure.”
+Added: Human Resource Capital
We do not currently have any employees and do not expect to have any employees.
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Our day-to-day investment operations are managed by the Adviser.
−Removed: The services necessary for sourcing and administration of our investment portfolio will be provided by investment
−Removed: professionals employed by the Adviser or its affiliates.
+Added: The services necessary for the sourcing and administration of our investment portfolio will be provided by investment professionals employed by the Adviser or its affiliates.
The Investment Team will focus on origination, non-originated investments and transaction development and the ongoing monitoring of our investments.
−Removed: Repurchase Program
+Added: Share Repurchase Program
Beginning from the end of the Initial Drawdown Period, until an Exchange Listing, we intend to commence tender offers to allow shareholders to tender their shares on a quarterly basis at a price per share expected to reflect NAV per share.
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To validate market quotations, we will utilize a number of factors to determine if the quotations are representative of fair value, including the source and number of the quotations.
−Removed: Debt and equity securities that are not publicly-traded or whose market prices are not readily available, as is expected to be the case for substantially all of our investments, will be valued at fair value as determined in good faith pursuant to procedures adopted by, and under the oversight of, the Board, based on, among other things, the input of the Adviser, the Audit Committee and independent third-party valuation firm(s) engaged at the direction of the Board to review our investments.
+Added: Where it is possible to obtain reliable, independent market quotations from a third party vendor, we will use these quotations to determine the value of our investments.
+Added: Debt and equity securities that are not publicly-traded or whose market prices are not readily available, as is expected to be the case for a substantial portion of our investments, will be valued at fair value as determined in good faith pursuant to procedures adopted by, and under the oversight
+Added: of, the Board, based on, among other things, the input of the Adviser, the Audit Committee and independent third-party valuation firm(s) engaged at the direction of the Board to review our investments.
With respect to investments for which market quotations are not readily available, the Company uses a multi-step valuation process, which includes, among other procedures, the following:
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• The Audit Committee reviews the valuation recommendations made by the Adviser's Valuation Committee, including the independent valuation firms' valuations, and once approved, recommends them for approval by the Board;
−Removed: • The Board reviews the valuation recommendations of the Audit Committee and determines the fair value of each investment in the portfolio in good faith based on the input of the Audit Committee, the Adviser's Valuation Committee and, where applicable, the independent valuation firms.
+Added: • The Board reviews the valuation recommendations of the Audit Committee and determines the fair value of each investment in the portfolio in good faith based on the input of the Audit Committee, the Adviser's Valuation Committee and, where applicable, the independent valuation firms and other external service providers.
Valuation of each of our investments will generally be made as described above as of the end of each fiscal quarter.
−Removed: In cases where we determine our NAV at times other than a quarter end, we intend to update the value of securities with market quotations to the most recent market quotation.
−Removed: For securities without market quotations, non-quarterly valuations will generally be the most recent quarterly valuation unless a material event has occurred since the most recent quarter end with respect to the investment.
+Added: In cases where we determine our NAV at times other than a quarter end, we intend to update the value of securities with reliable market quotations to the most recent market quotation.
+Added: For securities without reliable market quotations, non-quarterly valuations will generally be the most recent quarterly valuation unless a material event has occurred since the most recent quarter end with respect to the investment.
Independent valuation firms are generally not used for non-quarterly valuations.
−Removed: As part of the valuation process, the Board, or its delegates under this valuation policy, takes into account relevant factors in determining the fair value of its investments, many of which are loans, including and in combination, as relevant, of:
+Added: As part of the valuation process, we take into account relevant factors in determining the fair value of its investments, many of which are loans, including and in combination, as relevant, of:
(i) the estimated enterprise value of a portfolio company, (ii) the nature and realizable value of any collateral, (iii) the portfolio company’s ability to make payments based on its earnings and cash flow, (iv) the markets in which the portfolio company does business, (v) a comparison of the portfolio company’s securities to any similar publicly traded securities, and (vi) 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.
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(3) Securities purchased in a private transaction from a U.S.
−Removed: issuer that is not an investment company or from an affiliated person of the issuer, or in transactions incident thereto, if the issuer is in bankruptcy and subject to reorganization or if the issuer, immediately prior to the purchase of its securities was unable to meet its
−Removed: obligations as they came due without material assistance other than conventional lending or financing arrangements.
+Added: issuer that is not an investment company or from an affiliated person of the issuer, or in transactions incident thereto, if the issuer is in bankruptcy and subject to reorganization or if the issuer, immediately prior to the purchase of its securities was unable to meet its obligations as they came due without material assistance other than conventional lending or financing arrangements.
(4) Securities of an Eligible Portfolio Company purchased from any person in a private transaction if there is no ready market for such securities and the BDC already owns 60% of the outstanding equity of the Eligible Portfolio Company.
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Under the 1940 Act, a BDC is subject to restrictions on the issuance, terms and amount of warrants, options or rights to purchase shares that it may have outstanding at any time.
−Removed: In particular, the amount of shares that would result from the conversion or exercise of all outstanding warrants, options or rights to purchase shares cannot exceed 25% of the BDC’s total outstanding shares.
+Added: In particular, the amount of shares that would result from
+Added: the conversion or exercise of all outstanding warrants, options or rights to purchase shares cannot exceed 25% of the BDC’s total outstanding shares.
Leverage and Senior Securities;
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We are also permitted to borrow amounts up to 5% of the value of our total assets for temporary or emergency purposes, which borrowings would not be considered senior securities.
−Removed: We have established asset based credit facilities and a subscription facility and may establish future facilities or enter into other financing arrangements to facilitate investments and the timely payment of our expenses.
+Added: We have established asset based credit facilities and may establish future facilities or enter into other financing arrangements to facilitate investments and the timely payment of our expenses.
Our existing financing facilities bear, and it is anticipated that any future credit facilities will bear interest at floating rates at to be determined spreads over LIBOR.
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In addition, from time to time, our losses on leveraged investments may result in the liquidation of other investments held by us and may result in additional drawdowns to repay such amounts.
+Added: We also issued two unsecured bonds and may have additional bond offerings in the future.
We may enter into a total return swap (“ TRS ”) agreement.
−Removed: A TRS is a contract in which one party agrees to make periodic payments to another party based on the change in the market value of the assets underlying the TRS, which may include a specified security, basket of securities or securities indices during a specified period, in return for periodic payments
−Removed: based on a fixed or variable interest rate.
+Added: A TRS is a contract in which one party agrees to make periodic payments to another party based on the change in the market value of the assets underlying the TRS, which may include a specified security, basket of securities or securities indices during a specified period, in return for periodic payments based on a fixed or variable interest rate.
A TRS effectively adds leverage to a portfolio by providing investment exposure to a security or market without owning or taking physical custody of such security or investing directly in such market.
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Personnel subject to the code are permitted to invest in securities for their personal investment accounts, including securities that may be purchased or held by us, so long as such investments are made in accordance with the code’s requirements.
+Added: You may read and copy this code of ethics at the SEC's Public Reference Room in Washington, D.C.
+Added: You may obtain information on the operation of the Public Reference Room by calling the SEC at (202) 551-8090.
+Added: You may also obtain copies of the codes of ethics, after paying a duplicating fee, by electronic request at the following email address:
+Added: publicinfo@sec.gov, or by writing the SEC's Public Reference Section, 100 F Street, N.E., Washington, D.C.
Affiliated Transactions.
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Proxy Voting Policies and Procedures
−Removed: Shareholders have delegated our proxy voting responsibility to the Adviser.
+Added: We have delegated our proxy voting responsibility to the Adviser.
The Proxy Voting Policies and Procedures of the Adviser are set forth below.
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You may obtain information, without charge, regarding how we voted proxies with respect to our portfolio securities by making a written request for proxy voting information to:
−Removed: Chief Compliance Officer, GSO Asset Management LLC, 345 Park Avenue, 31st Floor, New York, NY 10154.
+Added: Chief Compliance Officer, Blackstone Credit BDC Advisors LLC, 345 Park Avenue, 31st Floor, New York, NY 10154.
Reporting Obligations and Available Information
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The SEC maintains a website (www.sec.gov) that contains reports, proxy and information statements, and other information.
−Removed: We have made available free of charge on our website (www.bgsl.com) our annual reports on Form 10-K, quarterly reports on Form 10-Q, our current reports on Form 8-K and our governing documents.
+Added: We have made available free of charge on our website (www.bxsl.com) our annual reports on Form 10-K, quarterly reports on Form 10-Q, our current reports on Form 8-K and our governing documents.
Material U.S.
Federal Income Tax Considerations
−Removed: The following discussion is a general summary of the material U.S.
+Added: The following discussion is a general summary of certain U.S.
federal income tax considerations applicable to the Company.
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and (4) diversify its holdings so that, at the end of each quarter of each taxable year of the Company (a) at least 50% of the value of the Company’s total assets is represented by cash and cash items (including receivables), U.S.
−Removed: government securities and securities of other RICs, and other securities for
−Removed: purposes of this calculation limited, in respect of any one issuer to an amount not greater in value than 5% of the value of the Company’s total assets and to not more than 10% of the outstanding voting securities of such issuer, and (b) not more than 25% of the value of the Company’s total assets is invested in the securities (other than U.S.
+Added: government securities and securities of other RICs, and other securities for purposes of this calculation limited, in respect of any one issuer to an amount not greater in value than 5% of the value of the Company’s total assets and to not more than 10% of the outstanding voting securities of such issuer, and (b) not more than 25% of the value of the Company’s total assets is invested in the securities (other than U.S.
government securities or securities of other RICs) of (I) any one issuer, (II) any two or more issuers which the Company controls and which are determined to be engaged in the same or similar trades or businesses or related trades or businesses or (III) any one or more Qualified Publicly Traded Partnerships (described in 3b above).
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If the Company fails to qualify as a RIC or fails to satisfy the 90% distribution requirement in any taxable year, the Company would be subject to U.S.
−Removed: federal income tax at regular corporate rates on its taxable income (including distributions of net capital gain), even if such income were distributed to its shareholders, and all distributions out of earnings and profits would be taxed to shareholders as ordinary dividend income.
+Added: federal income tax at regular corporate rates on its taxable income (including distributions
+Added: of net capital gain), even if such income were distributed to its shareholders, and all distributions out of earnings and profits would be taxed to shareholders as ordinary dividend income.
Such distributions generally would be eligible (i) to be treated as “qualified dividend income” in the case of individual and other noncorporate shareholders and (ii) for the dividends received deduction in the case of corporate shareholders.
1 unchanged sentence
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.