What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2020-11-09 compared with 2020-08-10 · 509 added, 509 removed, 3491 unchanged (23% of the section changed)

This section is long enough that the comparison stopped early. What follows is partial, and the remainder is not necessarily unchanged.

3 unchanged sentences

(in millions, except share and per share amounts)

June 30, 2020

September 30, 2020

December 31, 2019

44 unchanged sentences

Three Months Ended

Six Months Ended June 30,

September 30,

Nine Months Ended

September 30,

Investment income

5 unchanged sentences

Paid-in-kind interest income

Dividend income

From controlled/affiliated investments:

42 unchanged sentences

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Net investment income (loss)

19 unchanged sentences

(in millions)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities

37 unchanged sentences

See Note 9 for a discussion of the Companys financing arrangements.

During the six months ended June 30, 2020 and 2019, the Company

paid $74 and $83, respectively, in interest expense on the financing arrangements.

See notes to unaudited

consolidated financial statements.

During the nine months ended September 30, 2020 and 2019, the

Company paid $110 and $122, respectively, in interest expense on the financing arrangements.

unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

19 unchanged sentences

Commercial & Professional Services

Alion Science & Technology Corp

Capital Goods

All Systems Holding LLC

2 unchanged sentences

Commercial & Professional Services

All Systems Holding LLC

Commercial & Professional Services

AM General LLC

11 unchanged sentences

Diversified Financials

Apex Group Limited

Diversified Financials

Ardonagh Group Ltd

L+750, 0.0% PIK (2.3% Max PIK)

Aspect Software Inc

7 unchanged sentences

Food & Staples Retailing

Borden (New Dairy Opco)

Food, Beverage & Tobacco

Borden (New Dairy Opco)

Food, Beverage & Tobacco

L+700, 0.0% PIK (1.0% Max PIK)

Borden Dairy Co

12 unchanged sentences

L+577, 3.0% PIK (3.0% Max PIK)

Software & Services

Distribution International Inc

10 unchanged sentences

Media & Entertainment

L+575, 2.5% PIK (2.5% Max PIK)

Entertainment Benefits Group LLC

Media & Entertainment

L+575, 2.5% PIK (2.5% Max PIK)

Entertainment Benefits Group LLC

Media & Entertainment

L+575, 2.5% PIK (2.5% Max PIK)

Frontline Technologies Group LLC

3 unchanged sentences

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

17 unchanged sentences

15.0% PIK (15.0% Max PIK)

HM Dunn Co Inc

Capital Goods

15.0% PIK (15.0% Max PIK)

Hudson Technologies Co

1 unchanged sentence

Commercial & Professional Services

E+500, 2.3% PIK (2.3% Max PIK)

Commercial & Professional Services

L+525, 2.3% PIK (2.3% Max PIK)

Industria Chimica Emiliana Srl

21 unchanged sentences

Commercial & Professional Services

Lionbridge Technologies Inc

7 unchanged sentences

L+463, 1.0%PIK (1.0% Max PIK)

MB Precision Holdings LLC

Capital Goods

L+725, 2.3% PIK (2.3% Max PIK)

Micronics Filtration Holdings Inc

Capital Goods

L+800, 0.5% PIK (0.5% Max PIK)

7.5% PIK (7.5% Max PIK)

Motion Recruitment Partners LLC

6 unchanged sentences

One Call Care Management Inc

Health Care Equipment & Services

P2 Energy Solutions Inc.

6 unchanged sentences

L+725, 1.8% PIK (1.8% Max PIK)

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

(in millions, except share amounts)

Polyconcept North America Inc

Household & Personal Products

L+450 PIK (L+450 Max PIK)

Premium Credit Ltd

2 unchanged sentences

Household & Personal Products

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2020

(in millions, except share amounts)

Pretium Packaging LLC

7 unchanged sentences

Health Care Equipment & Services

Revere Superior Holdings Inc

Software & Services

Revere Superior Holdings Inc

Software & Services

Roadrunner Intermediate Acquisition Co LLC

3 unchanged sentences

RSC Insurance Brokerage Inc

Safe-Guard Products International LLC

1 unchanged sentence

L+600, 2.8% PIK (2.8% Max PIK)

L+700, 2.8% PIK (2.8% Max PIK)

C+650, 2.8% PIK (2.8% Max PIK)

Capital Goods

L+675, 0.0% PIK (1.0% Max PIK)

Sequel Youth & Family Services LLC

6 unchanged sentences

Telecommunication Services

Staples Canada

Sungard Availability Services Capital Inc

13 unchanged sentences

Capital Goods

L+600, 11.0% PIK (11.0% Max PIK)

L+1,100 PIK (L+1,100 Max PIK)

ThreeSixty Group

29 unchanged sentences

Transportation

Wheels Up Partners LLC

Transportation

notes to unaudited consolidated financial statements.

1 unchanged sentence

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

7 unchanged sentences

Transportation

Wheels Up Partners LLC

Transportation

Z Gallerie LLC

1 unchanged sentence

Software & Services

Zeta Interactive Holdings Corp

Software & Services

Total Senior Secured LoansFirst Lien

9 unchanged sentences

Automobiles & Components

Arena Energy LP

L+1,200, 4.0% PIK (4.0% Max PIK)

E+500 PIK (E+500 Max PIK)

athenahealth Inc

9 unchanged sentences

Household & Personal Products

Emerald Performance Materials LLC

Gruden Acquisition Inc

3 unchanged sentences

Consumer Durables & Apparel

11.8% PIK (11.8% Max PIK)

L+1,175 PIK (L+1,175 Max PIK)

NEP Broadcasting LLC

10 unchanged sentences

Household & Personal Products

11.0% PIK (11.0% Max PIK)

Pure Fishing Inc

3 unchanged sentences

Capital Goods

L+400, 6.8% PIK (6.8% Max PIK)

Sorenson Communications LLC

Telecommunication Services

11.5% PIK (11.5% Max PIK)

L+1,150 PIK (L+1,150 PIK Max

Sparta Systems Inc

15 unchanged sentences

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

8 unchanged sentences

Consumer Services

FourPoint Energy LLC

(e)(f)(g)(n)(w)

JW Aluminum Co

Consumer Durables & Apparel

Mood Media Corp

(f)(g)(n)(w)(y)

Media & Entertainment

14.0% PIK (14.0% Max PIK)

Capital Goods

4 unchanged sentences

Subordinated Debt5.6%

Alion Science & Technology Corp

Capital Goods

Alion Science & Technology Corp

Capital Goods

All Systems Holding LLC

1 unchanged sentence

10.0% PIK (10.0% Max PIK)

Ardonagh Group Ltd

athenahealth Inc

1 unchanged sentence

L+1,113 PIK (L+1,113 Max PIK)

Byrider Finance LLC

Automobiles & Components

20.0% PIK (20.0% Max PIK)

ClubCorp Club Operations Inc

Consumer Services

Cornerstone (Ply Gem Holdings Inc)

Capital Goods

Craftworks Rest & Breweries Group Inc

5 unchanged sentences

Hilding Anders

(g)(l)(n)(w)(z)

Consumer Durables & Apparel

13.0% PIK (13.0% Max PIK)

Hilding Anders

1 unchanged sentence

Hilding Anders

(g)(l)(n)(w)(z)

Consumer Durables & Apparel

Ply Gem Holdings Inc

Capital Goods

Quorum Health Corp

Health Care Equipment & Services

13.0% PIK (13.0% Max PIK)

Total Subordinated Debt

15 unchanged sentences

Bank of Ireland, Class B Credit Linked Floating Rate Note

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

(in millions, except share amounts)

Byrider Finance LLC, Sub Note

11 unchanged sentences

15.0% PIK (15.0% Max PIK)

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2020

(in millions, except share amounts)

Global Jet Capital LLC, Structured Mezzanine

27 unchanged sentences

Diversified Financials

Global Lending Services LLC, Private Equity

Diversified Financials

Home Partners JV, Common Stock

14 unchanged sentences

Technology Hardware & Equipment

Luxembourg Life FundAbsolute Return Fund I, 1L Term Loan

Opendoor Labs Inc, 2L Term Loan

21 unchanged sentences

Net Asset Based Finance

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

(in millions, except share amounts)

Strategic Credit Opportunities, LLC21.3%

2 unchanged sentences

Total Strategic Credit Opportunities Partners

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2020

(in millions, except share amounts)

Equity/Other16.1% (m)

16 unchanged sentences

Capital Goods

Ardonagh Ltd, Ordinary Shares

Ardonagh Ltd, Preferred Stock

Arena Energy LP, Warrants

Ascent Resources Utica Holdings LLC / ARU Finance Corp, Common Stock

10 unchanged sentences

Belk Inc, Units

Byrider Finance LLC, Common Stock

Automobiles & Components

Borden (New Dairy Opco), Common Stock

Food, Beverage & Tobacco

Cengage Learning, Inc, Common Stock

15 unchanged sentences

Empire Today LLC, Common Stock

FourPoint Energy LLC, Common Stock, Class CIIA Units

FourPoint Energy LLC, Common Stock, Class D Units

FourPoint Energy LLC, Common Stock, Class EII Units

FourPoint Energy LLC, Common Stock, Class EIII Units

FourPoint Energy LLC, Common Stock

Fronton BV, Common Stock

4 unchanged sentences

Technology Hardware & Equipment

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

(in millions, except share amounts)

Genesys Telecommunications Laboratories Inc, Preferred Stock

8 unchanged sentences

Consumer Durables & Apparel

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Unaudited Consolidated Schedule of Investments (continued)

As of September 30, 2020

(in millions, except share amounts)

Hilding Anders, Equity Options

17 unchanged sentences

12.5% PIK (12.5% Max PIK)

KKR BPT Holdings Aggregator LLC, Membership Interest

Diversified Financials

MB Precision Holdings LLC, Class A2 Units

Capital Goods

MB Precision Holdings LLC, Preferred Stock

Capital Goods

Micronics Filtration Holdings Inc, Common Stock

10 unchanged sentences

7.5% PIK (7.5% Max PIK)

Mood Media Corp, Common Stock

Mood Media LLC, Class A Warrants

Media & Entertainment

Mood Media LLC, Class B Warrants

Media & Entertainment

Mood Media LLC, Class C Warrants

Media & Entertainment

NBG Home, Common Stock

3 unchanged sentences

One Call Care Management Inc, Common Stock

Health Care Equipment & Services

4,370,566,806

One Call Care Management Inc, Preferred Stock A

Health Care Equipment & Services

One Call Care Management Inc, Preferred Stock B

Health Care Equipment & Services

9.0% PIK (9.0% Max PIK)

6 unchanged sentences

Proserv Acquisition LLC, Class A Preferred Units

Quorum Health Corp, Common Stock

Health Care Equipment & Services

Quorum Health Corp, Trade Claim

Health Care Equipment & Services

Quorum Health Corp, Trust Initial Funding Units

Health Care Equipment & Services

Ridgeback Resources Inc, Common Stock

19 unchanged sentences

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

Towergate, Ordinary Shares

Towergate, Preferred Stock

Trace3 Inc, Common Stock

16 unchanged sentences

Settlement Date

September 30,

Unrealized Appreciation

8 unchanged sentences

JP Morgan Chase Bank

Security may be an obligation of one or more entities affiliated with the named company.

1 unchanged sentence

basis point spread.

As of June 30, 2020, the three-month London Interbank Offered Rate, or LIBOR or L, was 0.30%, the Euro Interbank Offered Rate, or EURIBOR, was (0.42)%, Canadian Dollar Offer Rate, or CDOR, was 0.56% and the U.S.

As of September 30, 2020, the three-month London Interbank Offered Rate, or LIBOR or L, was 0.23%, the Euro Interbank Offered Rate, or EURIBOR, was (0.50)%, Canadian Dollar Offer Rate, or CDOR, was 0.51% and the

Prime Lending Rate, or Prime, was 3.25%.

1 unchanged sentence

PIK income accruals may be adjusted based on the fair value of the underlying investment.

Variable rate

securities with no floor rate use the respective benchmark rate in all cases.

rate securities with no floor rate use the respective benchmark rate in all cases.

Denominated in U.S.

dollars unless otherwise noted.

Fair value determined by the Companys board of directors (see Note 8).

notes to unaudited consolidated financial statements.

1 unchanged sentence

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

Fair value determined by the Companys board of directors (see Note 8).

Security or portion thereof held within Locust Street Funding LLC and is pledged as collateral supporting the amounts outstanding under the

10 unchanged sentences

Security or portion thereof held within CCT Dublin Funding Limited.

Position or portion thereof unsettled as of June 30, 2020.

Position or portion thereof unsettled as of September 30, 2020.

The investment is not a qualifying asset under the Investment Company Act of 1940, as amended.

1 unchanged sentence

any asset other than qualifying assets, unless, at the time the acquisition is made, qualifying assets represent at least 70% of the companys total assets.

As of June 30, 2020, 75.4% of the Companys total assets represented

As of September 30, 2020, 75.4% of the Companys total assets represented

qualifying assets.

14 unchanged sentences

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

2 unchanged sentences

exercise control over the management or policies of such portfolio company.

As of June 30, 2020, the Company held investments in portfolio companies of which it is deemed to be an affiliated person but is not deemed to

The following table presents certain information with respect to investments in portfolio companies of which the Company was deemed to be an affiliated person for the six months ended June 30, 2020:

As of September 30, 2020, the Company held investments in portfolio companies of which it is deemed to be an affiliated person but is not deemed to

The following table presents certain information with respect to investments in portfolio companies of which the Company was deemed to be an affiliated person for the nine months ended September 30, 2020:

Portfolio Company

5 unchanged sentences

Fair Value at

September 30,

Senior Secured LoansFirst Lien

Borden (New Dairy Opco)

Borden Dairy Co (4)

HM Dunn Co Inc

16 unchanged sentences

Asset Based Finance

Home Partners JV, Structured Mezzanine

Home Partners JV, Private Equity

Home Partners JV, Common Stock

Home Partners JV, Private Equity

Home Partners JV, Structured Mezzanine

Orchard Marine Limited, Class B Common Stock

3 unchanged sentences

ASG Technologies, Warrant

Borden (New Dairy Opco), Common Stock

Charlotte Russe Inc, Common Stock

2 unchanged sentences

HM Dunn Co Inc, Preferred Stock, Series B

Home Partners of America Inc, Common Stock

Home Partners of America Inc, Warrant

JW Aluminum Co, Common Stock

JW Aluminum Co, Preferred Stock

notes to unaudited consolidated financial statements.

1 unchanged sentence

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

6 unchanged sentences

Fair Value at

September 30,

Home Partners of America Inc, Common Stock

Home Partners of America Inc, Warrant

JW Aluminum Co, Common Stock

JW Aluminum Co, Preferred Stock

MB Precision Holdings LLC, Class A2 Units

21 unchanged sentences

sales, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company out of this category into a different category.

Interest, PIK, fee and dividend income presented for the full six months ended June 30, 2020.

Interest, PIK, fee and dividend income presented for the full nine months ended September 30, 2020.

The Company held this investment as of December 31, 2019 but it was not deemed to be an affiliated person of the portfolio

1 unchanged sentence

Transfers in or out have been presented at amortized cost.

Under the Investment Company Act of 1940, as amended, the Company generally is deemed to control a portfolio company if it owns

more than 25% of the portfolio companys voting securities or it has the power to exercise control over the management or policies of such portfolio company.

As of June 30, 2020, the Company held investments in portfolio companies of which

it is deemed to be an affiliated person and deemed to control.

During the six months ended June 30, 2020, the Company disposed of investments in portfolio companies of which it was deemed to be an affiliated

person and deemed to control.

The following table presents certain information with respect to investments in portfolio companies of which the Company was deemed to be an affiliated person and deemed to control for the six months

ended June 30, 2020:

notes to unaudited consolidated financial statements.

1 unchanged sentence

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

Under the Investment Company Act of 1940, as amended, the Company generally is deemed to control a portfolio company if it owns

more than 25% of the portfolio companys voting securities or it has the power to exercise control over the management or policies of such portfolio company.

As of September 30, 2020, the Company held investments in portfolio companies of

which it is deemed to be an affiliated person and deemed to control.

During the nine months ended September 30, 2020, the Company disposed of investments in portfolio companies of which it was deemed to be an

affiliated person and deemed to control.

The following table presents certain information with respect to investments in portfolio companies of which the Company was deemed to be an affiliated person and deemed to control for

the nine months ended September 30, 2020:

Portfolio Company

5 unchanged sentences

Fair Value at

September 30,

Senior Secured LoansFirst Lien

33 unchanged sentences

KKR BPT Holdings Aggregator LLC, Membership Interest

Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest, the amortization of

unearned income, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.

notes to unaudited consolidated financial statements.

1 unchanged sentence

Unaudited Consolidated Schedule of Investments (continued)

As of June 30, 2020

As of September 30, 2020

(in millions, except share amounts)

Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest, the amortization of

unearned income, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.

Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or

sales, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company out of this category into a different category.

Interest, PIK and dividend income presented for the full six months ended June 30, 2020.

Interest, PIK and dividend income presented for the full nine months ended September 30, 2020.

notes to unaudited consolidated financial statements.

232 unchanged sentences

Health Care Equipment & Services

Sequential Brands Group Inc.

Consumer Durables & Apparel

notes to unaudited consolidated financial statements.

3 unchanged sentences

(in millions, except share amounts)

Sequential Brands Group Inc.

Consumer Durables & Apparel

Smart Foodservice

331 unchanged sentences

Diversified Financials

Sofi Lending Corp, 2019-C R1

Diversified Financials

Star Mountain Diversified Credit Income Fund III, LP, Private Equity

Diversified Financials

notes to unaudited consolidated financial statements.

3 unchanged sentences

(in millions, except share amounts)

Sofi Lending Corp, 2019-C R1

Diversified Financials

Star Mountain Diversified Credit Income Fund III, LP, Private Equity

Diversified Financials

Toorak Capital Funding LLC, Membership Interest

47 unchanged sentences

Chisholm Oil & Gas Operating LLC, Series A Units

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

CSafe Global, Common Stock

6 unchanged sentences

Consumer Durables & Apparel

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

DEI Sales Inc, Series II Units

57 unchanged sentences

Capital Goods

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Micronics Filtration Holdings Inc, Common Stock

6 unchanged sentences

Media & Entertainment

notes to unaudited consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

NBG Home, Common Stock

104 unchanged sentences

Security is non-income producing.

Security held within IC American Energy Investments, Inc., a wholly-owned subsidiary of the Company.

notes to unaudited consolidated financial statements.

3 unchanged sentences

(in millions, except share amounts)

Security held within IC American Energy Investments, Inc., a wholly-owned subsidiary of the Company.

Security held within FSIC Investments, Inc., a wholly-owned subsidiary of the Company.

35 unchanged sentences

Z Gallerie LLC

Other Senior Secured Debt

JW Aluminum Co (5)

notes to unaudited consolidated financial statements.

11 unchanged sentences

December 31, 2019

Other Senior Secured Debt

JW Aluminum Co (5)

Mood Media Corp

35 unchanged sentences

Z Gallerie LLC, Common Stock

Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest, the amortization of

unearned income, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.

notes to unaudited consolidated financial statements.

3 unchanged sentences

(in millions, except share amounts)

Gross additions include increases in the cost basis of investments resulting from new portfolio investments, PIK interest, the amortization of

unearned income, the exchange of one or more existing securities for one or more new securities and the movement of an existing portfolio company into this category from a different category.

Gross reductions include decreases in the cost basis of investments resulting from principal collections related to investment repayments or

46 unchanged sentences

Toorak Capital LLC, Membership Interest

Strategic Credit Opportunities Partners, LLC

notes to unaudited consolidated financial statements.

11 unchanged sentences

December 31, 2019

Strategic Credit Opportunities Partners, LLC

Advanced Lighting Technologies Inc, Common

31 unchanged sentences

federal income tax purposes, and intends to qualify annually, as a regulated investment company, or RIC, as defined under Subchapter M of the Internal Revenue Code of 1986, as amended, or the Code.

June 30, 2020, the Company had various wholly-owned subsidiaries, including special-purpose financing subsidiaries and subsidiaries through which it holds interests in portfolio companies.

The unaudited consolidated financial statements include

both the Companys accounts and the accounts of its wholly-owned subsidiaries as of June 30, 2020.

September 30, 2020, the Company had various wholly-owned subsidiaries, including special-purpose financing subsidiaries and subsidiaries through which it holds interests in portfolio companies.

The unaudited consolidated financial statements

include both the Companys accounts and the accounts of its wholly-owned subsidiaries as of September 30, 2020.

All significant intercompany transactions have been eliminated in consolidation.

Certain of the Companys consolidated subsidiaries are

subject to U.S.

Certain of the Companys consolidated

subsidiaries are subject to U.S.

federal and state income taxes.

The Companys investment objectives are to generate current income and,

to a lesser extent, long-term capital appreciation.

The Companys investment objectives are to generate

current income and, to a lesser extent, long-term capital appreciation.

The Companys portfolio is comprised primarily of investments in senior secured loans and second lien secured loans of private middle-market U.S.

companies and, to a lesser extent,

subordinated loans and certain asset-based financing loans of private U.S.

In addition, a portion of the Companys portfolio may be comprised of equity and equity-related securities, corporate bonds, structured products, other debt

securities and derivatives, including total return swaps and credit default swaps.

The Company is externally managed by FS/KKR

Advisor, LLC, or the Advisor, pursuant to an investment advisory agreement, dated as of December 20, 2018, or the investment advisory agreement.

On April 9, 2018, GSO / Blackstone Debt Funds Management LLC, or GDFM, resigned as the

investment sub-adviser to the Company and terminated the investment sub-advisory agreement, or the investment sub-advisory

agreement, between FB Income Advisor, LLC, or FB Advisor, and GDFM, effective April 9, 2018.

In connection with GDFMs resignation as the investment sub-adviser to the Company, on April 9, 2018,

the Company entered into an investment advisory agreement, or the prior investment advisory agreement, with the Advisor.

The prior investment advisory agreement replaced the amended and restated investment advisory agreement, dated July 17,

2014, or the FB Advisor investment advisory agreement, by and between the Company and FB Advisor.

On June 15, 2020, the

Company filed Articles of Amendment to its Articles of Incorporation, or the Reverse Stock Split Amendment, with the State Department of Assessments and Taxation of the State of Maryland to effect a 4 to 1 reverse split of the Companys shares

of common stock, or the Reverse Stock Split.

The Reverse Stock Split became effective in accordance with the terms of the Reverse Stock Split Amendment on June 15, 2020.

The Reverse Stock Split affected all shareholders uniformly and did not alter any shareholders percentage interest in the Companys equity, except to the extent that the Reverse Stock Split

resulted in some shareholders owning a fractional share.

In that regard, no fractional shares were issued in connection with the Reverse Stock Split.

Shareholders of record who would have otherwise been entitled to receive a fractional share instead

received a cash payment based on the closing price of the Companys common stock as reported on the NYSE as of June 15, 2020.

A summary of the Companys weighted average number of shares of common stock outstanding and earnings per

share after adjusting for the Reverse Stock Split is as follows:

companies and, to a lesser

extent, subordinated loans and certain asset-based financing loans of private U.S.

In addition, a portion of the Companys portfolio may be comprised of equity and equity-related securities, corporate bonds, structured products,

other debt securities and derivatives, including total return swaps and credit default swaps.

The Company is externally

managed by FS/KKR Advisor, LLC, or the Advisor, pursuant to an investment advisory agreement, dated as of December 20, 2018, or the investment advisory agreement.

On April 9, 2018, GSO / Blackstone Debt Funds Management LLC, or GDFM,

resigned as the investment sub-adviser to the Company and terminated the investment sub-advisory agreement, or the investment

sub-advisory agreement, between FB Income Advisor, LLC, or FB Advisor, and GDFM, effective April 9, 2018.

In connection with GDFMs resignation as the investment

sub-adviser to the Company, on April 9, 2018, the Company entered into an investment advisory agreement, or the prior investment advisory agreement, with the Advisor.

The prior investment advisory

agreement replaced the amended and restated investment advisory agreement, dated July 17, 2014, or the FB Advisor investment advisory agreement, by and between the Company and FB Advisor.

On June 15, 2020, the Company filed Articles of Amendment to its Articles of Incorporation, or the Reverse Stock Split Amendment,

with the State Department of Assessments and Taxation of the State of Maryland to effect a 4 to 1 reverse split of the Companys shares of common stock, or the Reverse Stock Split.

The Reverse Stock Split became effective in accordance with the

terms of the Reverse Stock Split Amendment on June 15, 2020.

The Reverse Stock Split affected all shareholders uniformly

and did not alter any shareholders percentage interest in the Companys equity, except to the extent that the Reverse Stock Split resulted in some shareholders owning a fractional share.

In that regard, no fractional shares were issued in

connection with the Reverse Stock Split.

Shareholders of record who would have otherwise been entitled to receive a fractional share instead received a cash payment based on the closing price of the Companys common stock as reported on the

NYSE as of June 15, 2020.

A summary of the Companys weighted average number of shares of common stock outstanding and earnings per share after adjusting for the Reverse Stock Split is as follows:

September 30, 2019

Weighted average number of shares of common stock outstanding (as previously reported)

3 unchanged sentences

Earnings per share (as previously reported)

Earnings per share (ad adjusted)

Earnings per share (as adjusted)

FS KKR Capital Corp.

11 unchanged sentences

December 31, 2019.

Operating results for the three and six months ended June 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.

The December 31, 2019 consolidated

balance sheet and consolidated schedule of investments are derived from the Companys audited consolidated financial statements as of and for the year ended December 31, 2019.

The Company is considered an investment company under GAAP and

follows the accounting and reporting guidance applicable to investment companies under Accounting Standards Codification Topic 946, Financial ServicesInvestment Companies .

Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020.

The December 31, 2019

consolidated balance sheet and consolidated schedule of investments are derived from the Companys audited consolidated financial statements as of and for the year ended December 31, 2019.

The Company is considered an investment company

under GAAP and follows the accounting and reporting guidance applicable to investment companies under Accounting Standards Codification Topic 946, Financial ServicesInvestment Companies .

Use of Estimates:

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Reclassifications:

Certain amounts in the unaudited consolidated financial statements as of and for the three and six months ended June 30, 2019 and the audited consolidated financial

statements as of and for the year ended December 31, 2019 may have been reclassified to conform to the classifications used to prepare the unaudited consolidated financial statements as of and for the three and six months ended June 30,

Certain amounts in the unaudited consolidated financial statements as of and for the three and nine months ended September 30, 2019 and the audited consolidated financial

September 30, 2020.

Revenue Recognition:

Security transactions are accounted for on the trade date.

The Company records interest

income on an accrual basis to the extent that it expects to collect such amounts.

records interest income on an accrual basis to the extent that it expects to collect such amounts.

The Company records dividend income on the ex-dividend date.

Distributions received from limited liability company

(LLC) and limited partnership (LP) investments are evaluated to determine if the distribution should be recorded as dividend income or a return of capital.

The Company does not accrue as a receivable interest or dividends on

loans and securities if it has reason to doubt its ability to collect such income.

The Companys policy is to place investments on non-accrual status when there is reasonable doubt that interest income

will be collected.

The Company considers many factors relevant to an investment when placing it on or removing it from non-accrual status including, but not limited to, the delinquency status of the

investment, economic and business conditions, the overall financial condition of the underlying investment, the value of the underlying collateral, bankruptcy status, if any, and any other facts or circumstances relevant to the investment.

is reasonable doubt that the Company will receive any previously accrued interest, then the accrued interest will be written-off.

Distributions received from limited liability

company (LLC) and limited partnership (LP) investments are evaluated to determine if the distribution should be recorded as dividend income or a return of capital.

The Company does not accrue as a receivable interest or

dividends on loans and securities if it has reason to doubt its ability to collect such income.

The Companys policy is to place investments on non-accrual status when there is reasonable doubt that

interest income will be collected.

The Company considers many factors relevant to an investment when placing it on or removing it from non-accrual status including, but not limited to, the delinquency status

of the investment, economic and business conditions, the overall financial condition of the underlying investment, the value of the underlying collateral, bankruptcy status, if any, and any other facts or circumstances relevant to the investment.

there is reasonable doubt that the Company will receive any previously accrued interest, then the accrued interest will be written-off.

Payments received on non-accrual

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Structuring and other non-recurring upfront fees are recorded as fee income when earned.

For the six months ended June 30, 2020, the

For the nine months ended September 30, 2020, the

Company recognized $10 in structuring fee revenue.

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The Company implemented ASU

2018-13 during the six months ended June 30, 2020, and it did not have a significant impact on the Companys disclosure over fair value.

2018-13 during the nine months ended September 30, 2020, and it did not have a significant impact on the Companys disclosure over fair value.

FS KKR Capital Corp.

2 unchanged sentences

Share Transactions

Below is a summary of transactions with respect to shares of the Companys common stock during the six months ended June 30,

2020 and 2019:

Six Months Ended June 30,

Below is a summary of transactions with respect to shares of the Companys common stock during the nine months ended

September 30, 2020 and 2019:

Nine Months Ended September 30,

Share Repurchase Program

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The number of shares repurchased has been retroactively adjusted to reflect the Reverse Stock Split as discussed below.

During the six months ended June 30, 2020, the administrator for the Companys distribution

During the nine months ended September 30, 2020, the administrator for the Companys distribution

reinvestment plan, or DRP, purchased 1,196,874 shares of common stock in the open market at an average price per share of $15.70 (totaling $19) pursuant to the DRP, and distributed such shares to participants in the DRP.

During the six months ended

June 30, 2019, the administrator for the DRP purchased 451,406 shares of common stock in the open market at an average price per share of $24.09 (totaling $11) pursuant to the DRP, and distributed such shares to participants in the

During the period from July 1, 2020 to August 7, 2020, the administrator for the DRP purchased 378,300 shares of common stock in the open market at an average price per share of $14.30 (totaling $5) pursuant to the DRP, and

During the nine months ended

September 30, 2019, the administrator for the DRP purchased 756,259 shares of common stock in the open market at an average price per share of $24.30 (totaling $18) pursuant to the DRP, and distributed such shares to participants in the

During the period from October 1, 2020 to November 6, 2020, the administrator for the DRP purchased 307,516 shares of common stock in the open market at an average price per share of $16.37 (totaling $5) pursuant to the DRP, and

distributed such shares to participants in the DRP.

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Under the program, the Company was permitted to repurchase up to $200 in the aggregate of its outstanding common stock in the open market at prices below the then-current net asset value per share.

The program has terminated since the

aggregate repurchase amount that was approved by the Companys board of directors has been expended.

During the three

months ended June 30, 2020, the Company repurchased 588,342 shares of common stock pursuant to the share repurchase program at an average price per share (inclusive of commissions paid) of $12.63 (totaling $7).

During the six months ended

June 30, 2020, the Company repurchased 2,823,750 shares of common stock pursuant to the share repurchase program at an average price per share (inclusive of commissions paid) of $16.71 (totaling $47).

The program has terminated since the aggregate

repurchase amount that was approved by the Companys board of directors has been expended.

During the nine months ended

September 30, 2020, the Company repurchased 2,823,750 shares of common stock pursuant to the share repurchase program at an average price per share (inclusive of commissions paid) of $16.71 (totaling $47).

The number of shares repurchased and the average price per share amounts have been retroactively adjusted to reflect the Reverse Stock

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The following table describes the fees and expenses accrued under the investment advisory agreement and the

administration agreement, as applicable, during the three and six months ended June 30, 2020 and 2019:

administration agreement, as applicable, during the three and nine months ended September 30, 2020 and 2019:

Three Months Ended

Six Months Ended

September 30,

Nine Months Ended

September 30,

Related Party

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Transactions (continued)

During the six months ended June 30, 2020 and 2019, $60 and $49, respectively, in base management fees were paid to the Advisor.

June 30, 2020, $26 in base management fees were payable to the Advisor.

During the six months ended June 30, 2020 and 2019, $0 and $38, respectively, of subordinated incentive fees on income were paid to the

During the six months ended June 30, 2020 and 2019, $3 and $2, respectively, of administrative services expenses related to the

During the nine months ended September 30, 2020 and 2019, $86 and $77, respectively, in base management fees were paid to the Advisor.

of September 30, 2020, $24 in base management fees were payable to the Advisor.

During the nine months ended September 30, 2020 and 2019, $0 and $63, respectively, of subordinated incentive fees on income were paid to

During the nine months ended September 30, 2020 and 2019, $4 and $4, respectively, of administrative services expenses related to the

allocation of costs of administrative personnel for services rendered to the Company by the Advisor and the remainder related to other reimbursable expenses, including reimbursement of fees related to transactional expenses for prospective

investments, such as fees and expenses associated with performing due diligence reviews of investments that do not close, often referred to as broken deal costs.

Broken deal costs were $0.3 for the six months ended June 30, 2020.

The Company paid $5 and $3, respectively, in administrative services expenses to the Advisor during the six months ended June 30, 2020 and 2019.

Broken deal costs were $0.3 for the nine months ended September 30,

The Company paid $6 and $4, respectively, in administrative services expenses to the Advisor during the nine months ended September 30, 2020 and 2019.

Potential Conflicts of Interest

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In June 2020, that

investment vehicle entered into a written trading plan with a third party broker in accordance with Rule 10b5-1 and Rule 10b-18 promulgated under the Exchange Act to facilitate the purchase of shares of the Companys common

stock pursuant to the terms and conditions of such plan.

investment vehicle entered into a written trading plan with a third party broker in accordance with Rule 10b5-1 and Rule 10b-18 promulgated under the Exchange Act to

facilitate the purchase of shares of the Companys common stock pursuant to the terms and conditions of such plan.

The Company is not a party to the plan or any transaction with the investment vehicle.

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Distributions

The following table reflects the cash distributions per share that the Company has declared on its common stock during the six months ended June 30, 2020 and 2019:

The following table reflects the cash distributions per share that the Company has declared on its common stock during the nine months ended September 30, 2020 and 2019:

For the Three Months Ended

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June 30, 2019

September 30, 2019

March 31, 2020

June 30, 2020

September 30, 2020

The amount of each per share distribution has been retroactively adjusted to reflect the Reverse Stock Split as discussed above in Note 3.

On August 10, 2020, the Companys board of directors declared a regular quarterly cash distribution of

$0.60 per share, which will be paid on or about October 1, 2020 to stockholders of record as of the close of business on September 16, 2020.

The timing and amount of any future distributions to stockholders are subject to applicable

legal restrictions and the sole discretion of the Companys board of directors.

Pursuant to the DRP, the Company will

reinvest all cash dividends or distributions declared by the Companys board of directors on behalf of stockholders who do not elect to receive their distributions in cash.

As a result, if the Companys board of directors declares a

distribution, then stockholders who have not elected to opt out of the DRP will have their distributions automatically reinvested in additional shares of the Companys common stock.

On October 29, 2020, the Companys board of directors declared a regular quarterly cash

distribution of $0.60 per share, which will be paid on or about January 5, 2021 to stockholders of record as of the close of business on December 16, 2020.

The timing and amount of any future distributions to stockholders are subject

to applicable legal restrictions and the sole discretion of the Companys board of directors.

Pursuant to the DRP, the

Company will reinvest all cash dividends or distributions declared by the Companys board of directors on behalf of stockholders who do not elect to receive their distributions in cash.

As a result, if the Companys board of directors

declares a distribution, then stockholders who have not elected to opt out of the DRP will have their distributions automatically reinvested in additional shares of the Companys common stock.

With respect to each distribution pursuant to the DRP, the Company reserves the right to either issue new shares of common stock or

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There can be no assurance that the Company will be able to pay distributions at a specific rate or at all.

The following table reflects the sources of the cash distributions on a tax basis that the Company has paid on its common stock during the six months ended June 30, 2020 and 2019:

Six Months Ended June 30,

The following table reflects the sources of the cash distributions on a tax basis that the Company has paid on its common stock during the nine months ended September 30, 2020 and 2019:

Nine Months Ended September 30,

Source of Distribution

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Long-term capital gains proceeds from the sale of assets

During the six months ended June 30, 2020 and 2019, 88.8% and 90.9%, respectively, of the Companys gross investment income was

attributable to cash income earned, 1.8% and 2.0%, respectively, was attributable to non-cash accretion of discount and 9.4% and 7.1%, respectively, was attributable to PIK interest.

During the nine months ended September 30, 2020 and 2019, 88.2% and 91.5%, respectively, of the Companys gross investment income

was attributable to cash income earned, 1.7% and 1.9%, respectively, was attributable to non-cash accretion of discount and 10.1% and 6.6%, respectively, was attributable to PIK interest.

The determination of the tax attributes of the Companys distributions is made annually as of the end

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Net capital losses may be carried forward indefinitely, and their character is retained as short-term or long-term losses.

June 30, 2020, the Company had short-term and long-term capital loss carryforwards available to offset future realized capital gains of $30 and $599, respectively.

$85 of such losses were carried over from CCT due to the Merger, and $177 of

such losses were carried over from losses generated by the Company prior to the Merger.

September 30, 2020, the Company had short-term and long-term capital loss carryforwards available to offset future realized capital gains of $36 and $674, respectively.

$85 of such losses were carried over from CCT due to the Merger, and $177

of such losses were carried over from losses generated by the Company prior to the Merger.

Because of the loss limitation rules of the Code, some of the tax basis losses may be limited in their use.

Any unused balances resulting from such limitations

may be carried forward into future years indefinitely.

As of June 30, 2020 and December 31, 2019, the Companys

gross unrealized appreciation on a tax basis was $961 and $1,087, respectively.

As of June 30, 2020 and December 31, 2019, the Companys gross unrealized depreciation on a tax basis was $1,672 and $1,002, respectively.

Any unused balances resulting from such

limitations may be carried forward into future years indefinitely.

As of September 30, 2020 and December 31, 2019,

the Companys gross unrealized appreciation on a tax basis was $1,001 and $1,087, respectively.

As of September 30, 2020 and December 31, 2019, the Companys gross unrealized depreciation on a tax basis was $1,394 and $1,002,

respectively.

The aggregate cost of the Companys investments for U.S.

federal income tax purposes totaled $8,055 and $7,973 as of June 30,

2020 and December 31, 2019, respectively.

The aggregate net unrealized appreciation (depreciation) on investments on a tax basis was $(1,431) and $(616) as of June 30, 2020 and December 31, 2019, respectively.

The aggregate net

unrealized appreciation (depreciation) on investments on a tax basis excludes net unrealized appreciation (depreciation) from merger accounting, foreign currency forward contracts and foreign currency transactions.

As of June 30, 2020, the Company had a deferred tax liability of $11 resulting from unrealized appreciation on investments held by

the Companys wholly-owned taxable subsidiaries and a deferred tax asset of $60 resulting from net operating losses of

federal income tax purposes totaled $7,746 and

$7,973 as of September 30, 2020 and December 31, 2019, respectively.

The aggregate net unrealized appreciation (depreciation) on investments on a tax basis was $(1,097) and $(616) as of September 30, 2020 and December 31, 2019,

respectively.

The aggregate net unrealized appreciation (depreciation) on investments on a tax basis excludes net unrealized appreciation (depreciation) from merger accounting, foreign currency forward contracts and foreign currency transactions.

As of September 30, 2020, the Company had a deferred tax liability of $11 resulting from unrealized appreciation on

investments held by the Companys wholly-owned taxable subsidiaries and a deferred tax asset of $69 resulting from net

FS KKR Capital Corp.

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Distributions (continued)

the Companys wholly-owned taxable subsidiaries and unrealized depreciation on investments held by the Companys wholly-owned taxable subsidiaries.

As of June 30, 2020, certain

wholly-owned taxable subsidiaries anticipated that they would be unable to fully utilize their generated net operating losses and capital losses, therefore the deferred tax asset was offset by a valuation allowance of $49.

For the six months ended

June 30, 2020, the Company did not record a provision for taxes related to wholly-owned taxable subsidiaries.

The following table summarizes the composition of the Companys investment portfolio at cost and fair value

as of June 30, 2020 and December 31, 2019:

operating losses of the Companys wholly-owned taxable subsidiaries and unrealized depreciation on investments held by the Companys wholly-owned taxable subsidiaries.

September 30, 2020, certain wholly-owned taxable subsidiaries anticipated that they would be unable to fully utilize their generated net operating losses and capital losses, therefore the deferred tax asset was offset by a valuation allowance

For the nine months ended September 30, 2020, the Company did not record a provision for taxes related to wholly-owned taxable subsidiaries.

Investment Portfolio

The following table summarizes the

composition of the Companys investment portfolio at cost and fair value as of September 30, 2020 and December 31, 2019:

September 30,

December 31, 2019

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5% or more of its voting securities.

As of June 30, 2020, the Company held investments in ten portfolio companies of

which it is deemed to control. As of June 30, 2020, the Company held investments in fifteen portfolio companies of which it is deemed to be an affiliated person but is not deemed to control. For additional

information with respect to such portfolio companies, see footnotes (y) and (z) to the unaudited consolidated schedule of investments as of June 30, 2020 in this quarterly report on Form 10-Q.

As of December 31, 2019, the Company held investments in seven portfolio companies of which it is deemed to

control. As of December 31, 2019, the Company held investments in sixteen portfolio companies of which it is deemed to be an affiliated person but is not deemed to control. For additional information with

respect to such portfolio companies, see footnotes (y) and (z) to the consolidated schedule of investments as of December 31, 2019 in this quarterly report on Form 10-Q.

The Companys investment portfolio may contain loans and other unfunded arrangements that are in the form of lines of credit,

revolving credit facilities, delayed draw credit facilities or other investments, which require the Company to provide funding when requested by portfolio companies in accordance with the terms of the underlying agreements.

As of June 30, 2020,

the Company had unfunded debt investments with aggregate unfunded commitments of $330.3, unfunded equity/other commitments of $261.0 and unfunded commitments of $118.3 of Strategic Credit Opportunities Partners, LLC.

As of December 31, 2019,

the Company had unfunded debt investments with aggregate unfunded commitments of $438.0, unfunded equity commitments of $240.1 and unfunded commitments of $385.2 of Strategic Credit Opportunities Partners, LLC.

The Company maintains sufficient cash

on hand and available borrowings to fund such unfunded commitments should the need arise.

For additional details regarding the Companys unfunded debt investments, see the Companys unaudited consolidated schedule of investments as of

June 30, 2020 and the Companys audited consolidated schedule of investments as of December 31, 2019.

As of September 30, 2020, the Company held investments in ten portfolio companies of

which it is deemed to control. As of September 30, 2020, the Company held investments in fifteen portfolio companies of which it is deemed to be an affiliated person but is not deemed to control. For

additional information with respect to such portfolio companies, see footnotes (y) and (z) to the unaudited consolidated schedule of investments as of September 30, 2020 in this quarterly report on Form

As of December 31, 2019, the Company held investments in seven portfolio

companies of which it is deemed to control. As of December 31, 2019, the Company held investments in sixteen portfolio companies of which it is deemed to be an affiliated person but is not deemed to control.

For additional information with respect to such portfolio companies, see footnotes (y) and (z) to the consolidated schedule of investments as of December 31, 2019 in this quarterly report on Form

The Companys investment portfolio may contain loans and other unfunded

arrangements that are in the form of lines of credit, revolving credit facilities, delayed draw credit facilities or other investments, which require the Company to provide funding when requested by portfolio companies in accordance with the terms

of the underlying agreements.

As of September 30, 2020, the Company had unfunded debt investments with aggregate unfunded commitments of $310.8, unfunded equity/other commitments of $211.7 and unfunded commitments of $118.3 of Strategic Credit

Opportunities Partners, LLC.

As of December 31, 2019, the Company had unfunded debt investments with aggregate unfunded commitments of $438.0, unfunded equity commitments of $240.1 and unfunded commitments of $385.2 of Strategic Credit

Opportunities Partners, LLC.

The Company maintains sufficient cash on hand and available borrowings to fund such unfunded commitments should the need arise.

For additional details regarding the Companys unfunded debt investments, see the

Companys unaudited consolidated schedule of investments as of September 30, 2020 and the Companys audited consolidated schedule of investments as of December 31, 2019.

FS KKR Capital Corp.

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The table below describes investments by industry classification and enumerates the

percentage, by fair value, of the total portfolio assets in such industries as of June 30, 2020 and December 31, 2019:

June 30, 2020

percentage, by fair value, of the total portfolio assets in such industries as of September 30, 2020 and December 31, 2019:

September 30,

December 31, 2019

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day-to-day management responsibilities on behalf of SCJV and is entitled to a fee of 0.25% of SCJVs assets under administration, calculated and payable quarterly

As of June 30, 2020, the Company and SCRS have funded approximately $864.8 to SCJV, of which $756.7 was from the Company.

As of September 30, 2020, the Company and SCRS have funded approximately $864.8 to SCJV, of which $756.7 was from the Company.

FS KKR Capital Corp.

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first priority security interest in substantially all of the assets of Jersey City Funding, including its portfolio of assets.

As of June 30, 2020, total outstanding borrowings under the Jersey City Funding Credit Facility were $345.4.

As of September 30, 2020, total outstanding borrowings under the Jersey City Funding Credit Facility were $355.4.

On February 18, 2020, the Jersey City Funding Credit Facility maximum facility amount was reduced from $400 to $350

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including its portfolio of assets.

As of June 30, 2020, total outstanding borrowings under the Chestnut Street Funding Credit Facility were $345.9.

As of September 30, 2020, total outstanding borrowings under the Chestnut Street Funding Credit Facility were $322.9.

On February 21, 2020, the Chestnut Street Funding Credit Facility maximum facility amount was increased from $300 to $400 pursuant to the First Amendment to Loan and Servicing Agreement between

Chestnut Street Funding, SCJV, Citibank, and the other parties thereto.

SCJV was in compliance with all covenants required by its financing arrangements as of June 30, 2020 and December 31, 2019.

SCJV was in compliance with all covenants required by its financing arrangements as of September 30, 2020 and December 31, 2019.

On April 15, 2020, Boxwood Drive Funding LLC, or Boxwood Drive Funding, a wholly-owned special-purpose financing subsidiary of SCJV,

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and the maturity date for the Boxwood Drive Funding Credit Facility are April 15, 2023 and April 15, 2025, respectively.

Under the Boxwood Drive Funding Credit Facility, borrowings bear interest at the rate of LIBOR (or the relevant reference rate

for any foreign currency borrowings) (subject to a 0% floor) plus a spread of (i) during the reinvestment period, 2.05% to 3.15% per annum, and (ii) after the reinvestment period, 2.15% to 3.25% per annum, in each case, determined based on the

currency of the borrowing and the composition of the collateral portfolio.

During the reinvestment period, Boxwood Drive Funding is subject to an unused fee ranging from 0.375% to 1.00% per annum on the average daily unborrowed portion of the

facility amount below 85% of the facility amount.

Borrowings under the Boxwood Drive Funding Credit Facility are secured by a first priority security interest in substantially all of the assets of Boxwood Drive Funding, including its portfolio of

As of June 30, 2020, total outstanding borrowings under the Boxwood Drive Funding Credit Facility were $25.0.

Under the Boxwood Drive Funding Credit Facility, borrowings bear interest at the rate of LIBOR (or the relevant

reference rate for any foreign currency borrowings) (subject to a 0% floor) plus a spread of (i) during the reinvestment period, 2.05% to 3.15% per annum, and (ii) after the reinvestment period, 2.50% to 3.25% per annum, in each case,

determined based on the currency of the borrowing and the composition of the collateral portfolio.

During the reinvestment period, Boxwood Drive Funding is subject to an unused fee ranging from 0.375% to 1.00% per annum on the average daily

unborrowed portion of the facility amount below 85% of the facility amount.

Borrowings under the Boxwood Drive Funding Credit Facility are secured by a first priority security interest in substantially all of the assets of Boxwood Drive Funding,

including its portfolio of assets.

As of September 30, 2020, total outstanding borrowings under the Boxwood Drive Funding Credit Facility were $25.0.

FS KKR Capital Corp.

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Investment Portfolio (continued)

During the six months ended June 30, 2020, the Company sold investments with a cost

of $261.5 for proceeds of $228.4 to SCJV and recognized a net realized gain (loss) of $(33.1) in connection with the transactions.

As of June 30, 2020, $127.9 of these sales to SCJV are included in receivable for investments sold in the

consolidated statements of assets and liabilities.

As of June 30, 2020 and December 31, 2019, SCJV had total

investments with a fair value of $1,447.4 and $1,438.5, respectively.

As of June 30, 2020, SCJV had seven investments on non-accrual status.

As of December 31, 2019, SCJV had no investments on non-accrual status.

Below is a summary of SCJVs portfolio, followed by a listing of

the individual loans in SCJVs portfolio as of June 30, 2020 and December 31, 2019:

During the nine months ended September 30, 2020, the Company sold investments with

a cost of $353.6 for proceeds of $319.5 to SCJV and recognized a net realized gain (loss) of $(34.1) in connection with the transactions.

As of September 30, 2020, $218.1 of these sales to SCJV are included in receivable for investments sold in

the consolidated statements of assets and liabilities.

As of September 30, 2020 and December 31, 2019, SCJV had

total investments with a fair value of $1,559.8 and $1,438.5, respectively.

As of September 30, 2020, SCJV had eight investments on non-accrual status.

As of December 31, 2019, SCJV had no

investments on non-accrual status.

Below is a summary of SCJVs portfolio,

followed by a listing of the individual loans in SCJVs portfolio as of September 30, 2020 and December 31, 2019:

September 30,

Total debt investments (1)

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Strategic Credit Opportunities Partners, LLC Portfolio

As of June 30, 2020 (in millions)

As of September 30, 2020 (in millions)

Interest Rate (b)

Senior Secured Loans First Lien136.0%

1a Smart Start LLC

Technology Hardware & Equipment

1a Smart Start LLC

Technology Hardware & Equipment

1a Smart Start LLC

Technology Hardware & Equipment

ABB CONCISE Optical Group LLC

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Diversified Financials

Apex Group Limited

Diversified Financials

Ardonagh Group Ltd

Arrotex Australia Group Pty Ltd

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Technology Hardware & Equipment

BearCom Acquisition Corp

Technology Hardware & Equipment

Big Bus Tours Ltd

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Consumer Services

Casual Dining Group Ltd

Consumer Services

Catapult Learning LLC

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Health Care Equipment & Services

E+825, 1.8% PIK

(1.8% Max PIK)

Health Care Equipment & Services

E+825, 1.8% PIK

(1.8% Max PIK)

Diamond Resorts International Inc

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Automobiles & Components

Parts Authority Inc

Automobiles & Components

Parts Town LLC

Precision Global Corp

Premium Credit Ltd

Diversified Financials

Pretium Packaging LLC

43 unchanged sentences

Consumer Services

(11.5% Max PIK)

Excelitas Technologies Corp

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Capital Goods

PIK (0.5% Max

Total Senior Secured LoansSecond Lien

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Technology Hardware & Equipment

Luxembourg Life FundAbsolute Return Fund I, 1L Term Loan

Luxembourg Life FundLong Term Growth Fund, 1L Term Loan

MP4 2013-2A Class Subord.

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Diversified Financials

Pretium Partners LLC P1, Structured Mezzanine

2.8%, 5.3% PIK

(5.3% Max PIK)

FS KKR Capital Corp.

4 unchanged sentences

Pretium Partners LLC P1, Structured Mezzanine

2.0%, 7.5% PIK

(7.5% Max PIK)

Pretium Partners LLC P2, Structured Mezzanine

Sealane Trade Finance

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basis point spread.

As of June 30, 2020, the three-month London Interbank Offered Rate, or LIBOR or L, was 0.30%, the Euro Interbank Offered Rate, or EURIBOR, was (0.42)%, the Australian Bank Bill Swap Bid Rate, or BBSY or

As of September 30, 2020, the three-month London Interbank Offered Rate, or LIBOR or L, was 0.23%, the Euro Interbank Offered Rate, or EURIBOR, was (0.50)%, the Australian Bank Bill Swap Bid Rate, or BBSY or

B, was 0.14% and the Canadian Dollar Offer Rate, or CDOR, was 0.51%.

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Consumer Services

(L+1,200 Max PIK)

Casual Dining Group Ltd

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Health Care Equipment & Services

PIK (1.8% Max

E+825, 1.8% PIK

(1.8% Max PIK)

Health Care Equipment & Services

PIK (1.8% Max

E+825, 1.8% PIK

(1.8% Max PIK)

Diamond Resorts International Inc

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Pretium Partners LLC P2, Structured Mezzanine

2.0%, 7.5% PIK

(7.5% Max PIK)

Sealane Trade Finance

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Below is selected balance sheet information for SCJV as of

June 30, 2020 and December 31, 2019:

September 30, 2020 and December 31, 2019:

September 30,

Selected Balance Sheet Information

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Investment Portfolio (continued)

Below is selected statement of operations information for SCJV for the three and six months ended June 30, 2020 and 2019:

Below is selected statement of operations information for SCJV for the three and nine

months ended September 30, 2020 and 2019:

Three Months Ended

September 30,

Nine Months Ended

September 30,

Selected Statement of Operations Information

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Financial Instruments

The following is a summary of the fair value and location of the Companys derivative instruments in the consolidated balance sheets held as of June 30, 2020 and December 31, 2019:

The following is a summary of the fair value and location of the Companys derivative instruments in the consolidated balance sheets held as of September 30, 2020 and December 31, 2019:

Derivative Instrument

Statement Location

September 30,

Foreign currency forward contracts

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Unrealized depreciation on foreign currency forward contracts

Net realized and unrealized gains and losses on derivative instruments recorded by the Company for the six

months ended June 30, 2020 and 2019 are in the following locations in the consolidated statements of operations:

Net realized and unrealized gains and losses on derivative instruments recorded by the Company for the

nine months ended September 30, 2020 and 2019 are in the following locations in the consolidated statements of operations:

Net Realized Gains (Losses)

Six Months Ended

Nine Months Ended

September 30, 2020

Derivative Instrument

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Net Unrealized Gains (Losses)

June 30, 2020

Nine Months Ended

September 30, 2020

Derivative Instrument

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present the Companys assets and liabilities related to derivatives by counterparty, net of amounts available for offset under a master netting arrangement and net of any collateral received or pledged by the Company for such assets and

liabilities as of June 30, 2020 and December 31, 2019:

As of June 30, 2020

liabilities as of September 30, 2020 and December 31, 2019:

As of September 30, 2020

Assets Subject to

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The Company utilizes cross currency swaps from time to time in order to hedge a portion of its investments in foreign currency.

The average notional balance for foreign currency forward contracts during the six months ended June 30, 2020 and 2019 was $28.3 and

$222.5, respectively.

The average notional balance for foreign currency forward contracts during the nine months ended September 30, 2020 and 2019 was

$36.1 and $131.0, respectively.

FS KKR Capital Corp.

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Financial Instruments (continued)

As of June 30, 2020 and December 31, 2019, the Companys open foreign

currency forward contracts were as follows:

As of June 30,

As of September 30, 2020 and December 31, 2019, the Companys open

foreign currency forward contracts were as follows:

As of September 30,

Settlement Date

June 30, 2020

September 30, 2020

(Depreciation)

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JP Morgan Chase Bank

As of December 31,

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Instruments (continued)

As of June 30, 2020 and December 31, 2019, the Companys investments were

categorized as follows in the fair value hierarchy:

June 30, 2020

As of September 30, 2020 and December 31, 2019, the Companys investments

were categorized as follows in the fair value hierarchy:

September 30, 2020

Valuation Inputs

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In addition, the Company had foreign currency forward contracts, as described in Note 7, which were categorized as Level 2 in the

fair value hierarchy as of June 30, 2020 and December 31, 2019.

The Companys investments consist primarily of

debt investments that were acquired directly from the issuer.

Debt investments, for which broker quotes are not available, are valued by independent valuation firms, which determine the fair value of such investments by considering, among other

factors, the borrowers ability to adequately service its debt, prevailing interest rates for like investments, expected cash flows, call features, anticipated repayments and other relevant terms of the investments.

Except as described below,

all of the Companys equity/other investments are also valued by independent valuation firms, which determine the fair value of such investments by considering, among other factors, contractual rights ascribed to such investments, as well as

various income scenarios and multiples of earnings before interest, taxes, depreciation and amortization, or EBITDA, cash flows, net income, revenues or, in limited instances, book value or liquidation value.

An investment that is newly issued and

purchased near the date of the financial statements is valued at cost if the Companys board of directors determines that the cost of such investment is the best indication of its fair value.

Such investments described above are typically

classified as Level 3 within the fair value hierarchy.

Investments that are traded on an active public market are valued at their closing price as of the date of the financial statements and are classified as Level 1 within the fair value

Except as described above, the Company typically values its other investments by using the midpoint of the prevailing bid and ask prices from dealers on the date of the relevant period end, which are provided by independent third-party

pricing services and screened for validity by such services and are typically classified as Level 2 within the fair value hierarchy.

fair value hierarchy as of September 30, 2020 and December 31, 2019.

The Companys investments consist

primarily of debt investments that were acquired directly from the issuer.

Debt investments, for which broker quotes are not available, are valued by independent valuation firms, which determine the fair value of such investments by considering,

among other factors, the borrowers ability to adequately service its debt, prevailing interest rates for like investments, expected cash flows, call features, anticipated repayments and other relevant terms of the investments.

described below, all of the Companys equity/other investments are also valued by independent valuation firms, which determine the fair value of such investments by considering, among other factors, contractual rights ascribed to such

investments, as well as various income scenarios and multiples of earnings before interest, taxes, depreciation and amortization, or EBITDA, cash flows, net income, revenues or, in limited instances, book value or liquidation value.

An investment

that is newly issued and purchased near the date of the financial statements is valued at cost if the Companys board of directors determines that the cost of such investment is the best indication of its fair value.

Such investments described

above are typically classified as Level 3 within the fair value hierarchy.

Investments that are traded on an active public market are valued at their closing price as of the date of the financial statements and are classified as Level 1

within the fair value hierarchy.

independent third-party pricing services and screened for validity by such services and are typically classified as Level 2 within the fair value hierarchy.

The Company periodically benchmarks the bid and ask prices it receives from the third-party pricing services and/or dealers and independent valuation firms as applicable, against the actual prices at

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Instruments (continued)

The following is a reconciliation for the six months ended June 30, 2020 and 2019

The following is a reconciliation for the nine months ended September 30, 2020 and

2019 of investments for which significant unobservable inputs (Level 3) were used in determining fair value:

For the Six Months Ended June 30, 2020

For the Nine Months Ended September 30, 2020

Fair value at beginning of period

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unrealized gains or losses relating to investments still held at the reporting date

For the Six Months Ended June 30, 2019

For the Nine Months Ended September 30, 2019

Fair value at beginning of period

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The valuation techniques and significant unobservable inputs used in recurring

Level 3 fair value measurements as of June 30, 2020 and December 31, 2019 were as follows:

Level 3 fair value measurements as of September 30, 2020 and December 31, 2019 were as follows:

Type of Investment

Fair Value at

June 30, 2020

September 30, 2020

Technique (1)

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0.1x - 29.0x (7.9x)

Option Pricing Model

Equity Illiquidity Discount

60.00% - 60.00% (60.00%)

Subordinated Debt

EBITDA Multiple

5.2x - 7.8x (7.2x)

Discounted Cash Flow

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12.2% - 12.2% (12.2%)

EBITDA Multiple

5.50x - 10.00x (8.02x)

Asset Based Finance

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Type of Investment

Fair Value at

December 31, 2019

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Effective June 15, 2019, the Companys asset coverage requirement applicable to senior securities was reduced from 200% to 150%.

As of June 30, 2020,

As of September 30,

2020, the aggregate amount outstanding of the senior securities issued by the Company was $3,980.

As of June 30, 2020, the Companys asset coverage was 174%.

The following tables present summary information with respect to the Companys outstanding financing arrangements as of June 30, 2020 and December 31, 2019.

For additional information

regarding these financing arrangements, see the notes to the Companys audited consolidated financial statements contained in its annual report on Form 10-K for the year ended December 31, 2019.

significant changes to the Companys financing arrangements during the six months ended June 30, 2020 are discussed below.

As of June 30, 2020 (Unaudited)

As of September 30, 2020, the Companys asset coverage was 176%.

The following tables present summary information with respect to the Companys outstanding financing arrangements as of

September 30, 2020 and December 31, 2019.

For additional information regarding these financing arrangements, see the notes to the Companys audited consolidated financial statements contained in its annual report on Form 10-K for the year ended December 31, 2019.

Any significant changes to the Companys financing arrangements during the nine months ended September 30, 2020 are discussed below.

As of September 30, 2020 (Unaudited)

Type of Arrangement

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Revolving Credit Facility

L+1.75% - 2.00% (1)(3)

Locust Street Credit Facility (2)

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Revolving Credit Facility

L+1.75% - 2.00% (1)(4)

November 7, 2024

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converted to U.S.

dollars at an exchange rate of 1.00 to $1.12 as of June 30, 2020 to reflect total amount outstanding in U.S.

Canadian dollar balance outstanding of CAD $66 has been converted to U.S dollars at an exchange rate

of CAD $1.00 to $0.73 as of June 30, 2020 to reflect total amount outstanding in U.S.

Pound sterling balance outstanding of £121 has been converted to U.S dollars at an exchange rate of £1.00 to $1.24 as of June 30,

2020 to reflect total amount outstanding in U.S.

Australian dollar balance outstanding of A$7 has been converted to U.S dollars at an exchange rate of A$1.00 to $0.69 as of June 30, 2020 to reflect total amount outstanding in U.S.

As of June 30, 2020, the fair value of the 4.750% notes, the 5.000% notes, the 4.625% notes, the 4.125% notes and the 8.625% notes was

approximately $449, $236, $399, $456, and $286, respectively.

dollars at an exchange rate of 1.00 to $1.17 as of September 30, 2020 to reflect total amount outstanding in U.S.

Canadian dollar balance outstanding of CAD $74 has been converted to U.S dollars at an exchange

rate of CAD $1.00 to $0.75 as of September 30, 2020 to reflect total amount outstanding in U.S.

Pound sterling balance outstanding of £125 has been converted to U.S dollars at an exchange rate of £1.00 to $1.29 as of

September 30, 2020 to reflect total amount outstanding in U.S.

Australian dollar balance outstanding of A$6 has been converted to U.S dollars at an exchange rate of A$1.00 to $0.72 as of September 30, 2020 to reflect total amount

outstanding in U.S.

As of September 30, 2020, the fair value of the 4.750% notes, the 5.000% notes, the 4.625% notes, the 4.125% notes and the 8.625% notes

was approximately $456, $244, $405, $467, and $277, respectively.

These valuations are considered Level 2 valuations within the fair value hierarchy.

As of June 30, 2020, there were $299.4 of Class A-1 notes outstanding at L+1.70% and $52.3

As of September 30, 2020, there were $299.4 of Class A-1 notes outstanding at L+1.70% and

$52.3 of Class A-2 notes outstanding at L+2.50%.

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Revolving Credit Facility

L+1.75% - 2.00% (1)(3)

Locust Street Credit Facility (2)

3 unchanged sentences

Revolving Credit Facility

L+1.75% - 2.00% (1)(4)

November 7, 2024

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Financing Arrangements (continued)

For the three and six months ended June 30, 2020 and 2019, the components of total

interest expense for the Companys financing arrangements were as follows:

Three Months Ended June 30,

For the three and nine months ended September 30, 2020 and 2019, the components of

total interest expense for the Companys financing arrangements were as follows:

Three Months Ended September 30,

Arrangement (1)

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8.625% Notes due 2025

Six Months Ended June 30,

Nine Months Ended September 30,

Arrangement (1)

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The Companys average borrowings and weighted average interest rate, including the effect

of non-usage fees, for the six months ended June 30, 2020 were $4,415 and 3.76%, respectively.

As of June 30, 2020, the Companys weighted average effective interest rate on

of non-usage fees, for the nine months ended September 30, 2020 were $4,269 and 3.72%, respectively.

As of September 30, 2020, the Companys weighted average effective interest rate on

borrowings, including the effect of non-usage fees, was 3.65%.

Companys average borrowings and weighted average interest rate, including the effect of non-usage fees, for the six months ended June 30, 2019 were $3,503 and 4.59%, respectively.

June 30, 2019, the Companys weighted average effective interest rate on borrowings, including the effect of non-usage fees, was 4.60%.

Companys average borrowings and weighted average interest rate, including the effect of non-usage fees, for the nine months ended September 30, 2019 were $3,522 and 4.56%, respectively.

of September 30, 2019, the Companys weighted average effective interest rate on borrowings, including the effect of non-usage fees, was 4.44%.

FS KKR Capital Corp.

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The Company was in compliance with all covenants required by its financing arrangements as of

June 30, 2020 and December 31, 2019.

September 30, 2020 and December 31, 2019.

CCT Tokyo Funding Credit Facility

On May 14, 2020, CCT Tokyo Funding LLC, or CCT Tokyo Funding, a wholly-owned special-purpose financing subsidiary of the Company, elected

to extend the reinvestment period of its revolving credit facility, or the CCT Tokyo Funding Credit Facility, with Sumitomo Mitsui Banking Corporation, as the administrative agent, collateral agent, and lender, by an additional six months to

On May 14, 2020, CCT Tokyo Funding LLC, or CCT Tokyo Funding, a wholly-owned special-purpose financing subsidiary of the Company,

elected to extend the reinvestment period of its revolving credit facility, or the CCT Tokyo Funding Credit Facility, with Sumitomo Mitsui Banking Corporation, as the administrative agent, collateral agent, and lender, by an additional six months to

December 2, 2020.

Senior Secured Revolving Credit Facility

On March 3, 2020, the Company entered into a Commitment Increase Agreement in connection with its senior secured revolving credit facility, or as subsequently amended and restated, the Senior Secured

Revolving Credit Facility, with FS KKR Capital Corp.

II, as an additional borrower, JPMorgan Chase Bank, N.A., as administrative agent, ING Capital LLC, as collateral agent, and the lenders party thereto, which, among other things, increased the

total facility amount from $3,890 to $3,980.

On March 3, 2020, the Company entered into a Commitment Increase Agreement in connection with its senior secured revolving credit

facility, or as subsequently amended and restated, the Senior Secured Revolving Credit Facility, with FS KKR Capital Corp.

II, as an additional borrower, JPMorgan Chase Bank, N.A., as administrative agent, ING Capital LLC, as collateral agent, and

the lenders party thereto, which, among other things, increased the total facility amount from $3,890 to $3,980.

There was no change to the sublimit of the total facility amount available for the Company to borrow.

On May 5, 2020, the Company entered into that certain Amendment No.

1 to Amended and Restated Senior Secured Revolving Credit Agreement, or the Amendment, to the Senior Secured Revolving Credit

Facility, with FS KKR Capital Corp.

II, JPMorgan Chase Bank, N.A., as administrative agent, ING Capital LLC, as collateral agent, and the lenders party thereto to, among other things, reset the quarterly minimum shareholders equity test as the

greater of (a) 30% of the total assets as at the last day of such fiscal quarter and (b) $1,968.2 plus 37.5% of net equity proceeds after April 15, 2021.

1 to Amended and Restated Senior Secured Revolving Credit

Agreement, or the Amendment, to the Senior Secured Revolving Credit Facility, with FS KKR Capital Corp.

II, JPMorgan Chase Bank, N.A., as administrative agent, ING Capital LLC, as collateral agent, and the lenders party thereto to, among other

things, reset the quarterly minimum shareholders equity test as the greater of (a) 30% of the total assets as at the last day of such fiscal quarter and (b) $1,968.2 plus 37.5% of net equity proceeds after April 15, 2021.

8.625% Notes due 2025

On April 30, 2020, the Company and U.S.

National Association, as trustee, or U.S.

Bank, entered into that certain Sixth Supplemental Indenture, or the Sixth Supplemental Indenture, to the Indenture, dated as of July 14, 2014 between the Company and U.S.

Bank, or the Base Indenture,

and together with the Sixth Supplemental Indenture, the Indenture.

The Sixth Supplemental Indenture relates to the Companys issuance of $250 aggregate principal amount of its 8.625% notes due 2025, or the Notes, and such issuance of the Notes,

the Offering.

The Notes will mature on May 15, 2025 and may be redeemed in whole or in part at the Companys option

at any time or from time to time at the redemption prices set forth in the Indenture.

The Notes bear interest at a rate of 8.625% per year, subject to adjustment during any downgrade period as described in the Indenture, payable

semi-annually on May 15th and November 15th of each year, commencing on November 15, 2020.

The Notes are general unsecured obligations of the Company that rank senior in right of payment to all of the Companys existing and future

indebtedness that is expressly subordinated in right of payment to the Notes, rank pari passu with all existing and future unsecured unsubordinated indebtedness issued by the Company, rank effectively junior to any of the Companys

secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness, and rank structurally junior to all existing and future indebtedness (including trade

payables) incurred by the Companys subsidiaries, financing vehicles or similar facilities.

The Indenture contains certain covenants, including covenants requiring the Company to comply with the asset coverage requirements of

Section 18(a)(1)(A) as modified by Section 61(a)(1) and (2) of the Investment Company Act of 1940, as amended, whether or not it is subject to those requirements, to provide financial information to the holders of the Notes and U.S.

Bank if the Company is no longer subject to the reporting requirements under the Securities Exchange Act of 1934, as amended, and to use reasonable best efforts to obtain a rating of the Notes (but not a specific rating) from two or more rating

agencies within two months after the issuance of the Notes.

April 30, 2020, the Company and U.S.

Bank National Association, as trustee, or U.S.

Bank, entered into that certain Sixth Supplemental Indenture, or the Sixth Supplemental Indenture, to the Indenture, dated as of July 14, 2014 between the

Company and U.S.

Bank, or the Base Indenture, and together with the Sixth Supplemental Indenture, the Indenture.

The Sixth Supplemental Indenture relates to the Companys issuance of $250 aggregate principal amount of its 8.625% notes due 2025,

or the Notes, and such issuance of the Notes, the Offering.

The Notes will mature on May 15, 2025 and may be redeemed in

whole or in part at the Companys option at any time or from time to time at the redemption prices set forth in the Indenture.

The Notes bear interest at a rate of 8.625% per year, subject to adjustment during any downgrade period

as described in the Indenture, payable semi-annually on May 15th and November 15th of each year, commencing on November 15, 2020.

The Notes are general unsecured obligations of the Company that rank senior in right of payment to all of the

Companys existing and future indebtedness that is expressly subordinated in right of payment to the Notes, rank pari passu with all existing and future unsecured unsubordinated indebtedness issued by the Company, rank effectively junior

to any of the Companys secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness, and rank structurally junior to all existing and future

indebtedness (including trade payables) incurred by the Companys subsidiaries, financing vehicles or similar facilities.

The Indenture contains certain covenants, including covenants requiring the Company to comply with the asset coverage

requirements of Section 18(a)(1)(A) as modified by Section 61(a)(1) and (2) of the Investment Company Act of 1940, as amended, whether or not it is subject to those requirements, to provide financial information to the holders of the

Notes and U.S.

more rating agencies within two months after the issuance of the Notes.

These covenants are subject to important limitations and exceptions that are described in the Indenture.

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to fund these commitments.

As of June 30, 2020, the Companys unfunded commitments consisted of the following:

As of September 30, 2020, the Companys unfunded commitments consisted of the following:

Category / Company (1)

3 unchanged sentences

All Systems Holding LLC

Apex Group Limited

Ardonagh Group Ltd

Aspect Software Inc

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Heniff Transportation Systems LLC

HM Dunn Co Inc

Industria Chimica Emiliana Srl

Kellermeyer Bergensons Services LLC

3 unchanged sentences

Pretium Packaging LLC

Revere Superior Holdings Inc

RSC Insurance Brokerage Inc

Sungard Availability Services Capital Inc

Sweet Harvest Foods Management Co

Truck-Lite Co LLC

Zeta Interactive Holdings Corp

Asset Based Finance

1 unchanged sentence

Opendoor Labs Inc, 2L Term Loan

Unfunded Asset Based Finance/Other commitments

Unfunded Other Asset Based Finance/Other commitments

May be commitments to one or more entities affiliated with the named company.

As of June 30, 2020, the Companys debt commitments are comprised of $38.1 revolving credit facilities, $276.0 delayed draw term

loans and $16.2 term loans, which generally are used for acquisitions or capital expenditures and are subject to certain performance tests.

As of September 30, 2020, the Companys debt commitments are comprised of $46.5 revolving credit facilities, $252.5 delayed draw

term loans and $11.8 term loans, which generally are used for acquisitions or capital expenditures and are subject to certain performance tests.

Such unfunded debt commitments have a fair value representing unrealized appreciation (depreciation) of

The Companys unfunded Asset Based Finance/Other commitments generally require certain conditions to be met or actual approval from the Advisor prior to funding.

As of June 30, 2020, the Company also has an unfunded commitment to provide $118.3 of capital to SCJV.

As of September 30, 2020, the Company also has an unfunded commitment to provide $118.3 of capital to SCJV.

The capital commitment can be satisfied with contributions of cash and/or

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The Company has no such guarantees outstanding

at June 30, 2020 and December 31, 2019.

at September 30, 2020 and December 31, 2019.

Financial Highlights

The following is a schedule of financial highlights of the Company for the six months ended

June 30, 2020 and the year ended December 31, 2019:

Six Months Ended

June 30, 2020

The following is a schedule of financial highlights of the Company for the nine months ended September 30, 2020 and the year ended

December 31, 2019:

Nine Months Ended

September 30, 2020

December 31, 2019

Per Share Data:

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Per share data may be rounded in order to recompute the ending net asset value per share.

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

FS KKR Capital Corp.

2 unchanged sentences

Financial Highlights (continued)

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

The per share data for distributions reflect the actual amount of distributions paid per share during the applicable period.

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Weighted average net assets during the applicable period are used for this calculation.

Ratios for the six months ended June 30, 2020 are

Annualized ratios for the six months ended June 30, 2020 are not necessarily indicative of the ratios that may be expected for the year ending December 31, 2020.

The following is a schedule of supplemental ratios for the six

months ended June 30, 2020 and year ended December 31, 2019:

Six Months Ended

June 30, 2020

Ratios for the nine months ended September 30,

2020 are annualized.

Annualized ratios for the nine months ended September 30, 2020 are not necessarily indicative of the ratios that may be expected for the year ending December 31, 2020.

The following is a schedule of supplemental ratios

for the nine months ended September 30, 2020 and year ended December 31, 2019:

Nine Months Ended

September 30, 2020

December 31, 2019

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Ratio of excise taxes to average net assets

Portfolio turnover for the six months ended June 30, 2020 is not annualized.

Portfolio turnover for the nine months ended September 30, 2020 is not annualized.

Asset coverage per unit is the ratio of the carrying value of the Companys total consolidated assets, less liabilities and indebtedness

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restructuring of an investment.

In addition, a portion of our portfolio may be comprised of corporate bonds, structured products, other debt securities and derivatives, including total return swaps and credit default swaps.

The Advisor will seek to

tailor our investment focus as market conditions evolve.

Depending on market conditions, we may increase or decrease our exposure to less senior portions of the capital structures of our portfolio companies or otherwise make opportunistic

investments, such as where the market price of loans, bonds or other securities reflects a lower value than deemed warranted by the Advisors fundamental analysis.

Such investment opportunities

may occur due to general dislocations in the markets, a misunderstanding by the market of a particular company or an industry being out of favor with the broader investment community and may

include event driven investments, anchor orders and structured products.

The senior secured loans, second lien secured loans

and senior secured bonds in which we invest generally have stated terms of three to seven years and subordinated debt investments that we make generally have stated terms of up to ten years, but the expected average life of such securities is

In addition, a portion of our portfolio may be comprised of corporate bonds, structured products, other debt securities and derivatives, including total

return swaps and credit default swaps.

The Advisor will seek to tailor our investment focus as market conditions evolve.

Depending on market conditions, we may increase or decrease our exposure

to less senior portions of the capital structures of our portfolio companies or otherwise make opportunistic investments, such as where the market price of loans, bonds or other securities reflects a lower value than deemed warranted by the

Advisors fundamental analysis.

Such investment opportunities may occur due to general dislocations in the markets, a misunderstanding by the market of a particular company or an industry being out of favor with the broader investment community

and may include event driven investments, anchor orders and structured products.

The senior secured loans, second lien secured

loans and senior secured bonds in which we invest generally have stated terms of three to seven years and subordinated debt investments that we make generally have stated terms of up to ten years, but the expected average life of such securities is

generally three to four years.

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Our board of directors then assesses the reasonableness of such reimbursements for expenses allocated to us based on the breadth, depth and quality of such services as compared

to the estimated cost to us of obtaining similar services from third-party service providers known to be available.

In addition, our board of directors considers whether any single third-party service provider would be capable of providing all such

services at comparable cost and quality.

to the estimated cost to us of obtaining

similar services from third-party service providers known to be available.

In addition, our board of directors considers whether any single third-party service provider would be capable of

providing all such services at comparable cost and quality.

Finally, our board of directors compares the total amount paid to the Advisor for such services as a percentage of our net assets to the same ratio as reported by other comparable BDCs.

We bear all other expenses of our operations and transactions, including all other

expenses incurred by the Advisor in performing services for us and administrative personnel paid by the Advisor, to the extent they are not controlling persons of the Advisor or any of its affiliates, subject to the limitations included in the

investment advisory agreement and the administration agreement.

In addition, we have contracted with State Street Bank and

Trust Company to provide various accounting and administrative services, including, but not limited to, preparing preliminary financial information for review by the Advisor, preparing and monitoring expense budgets, maintaining accounting and

corporate books and records, processing trade information provided by us and performing testing with respect to RIC compliance.

We bear all other expenses of our operations and transactions, including all other expenses incurred by the Advisor in

performing services for us and administrative personnel paid by the Advisor, to the extent they are not controlling persons of the Advisor or any of its affiliates, subject to the limitations included in the investment advisory agreement and the

administration agreement.

In addition, we have contracted with State Street Bank and Trust Company to provide various

accounting and administrative services, including, but not limited to, preparing preliminary financial information for review by the Advisor, preparing and monitoring expense budgets, maintaining accounting and corporate books and records,

processing trade information provided by us and performing testing with respect to RIC compliance.

COVID-19 Developments

The rapid spread of the

COVID-19 pandemic, and associated impacts on the U.S.

and global economies, has negatively impacted, and is likely to continue to negatively impact, the business operations of some of our portfolio companies.

We cannot at this time fully predict the impact of COVID-19 on our business or the business of our portfolio companies, its duration or magnitude or the extent to which it will negatively impact our portfolio

companies operating results or our own results of operations or financial condition.

We expect that certain of our portfolio companies will continue to experience economic distress for the foreseeable future and may significantly limit

business operations if subjected to prolonged economic distress.

The rapid spread of the COVID-19 pandemic, and associated impacts on the U.S.

and global economies, has negatively impacted, and is likely to continue to negatively

impact, the business operations of some of our portfolio companies.

We cannot at this time fully predict the impact of COVID-19 on our business or the business of our portfolio companies, its duration or

magnitude or the extent to which it will negatively impact our portfolio companies operating results or our own results of operations or financial condition.

We expect that certain of our portfolio companies will continue to experience

economic distress for the foreseeable future and may significantly limit business operations if subjected to prolonged economic distress.

These developments could result in a decrease in the value of our investments.

COVID-19 has already had adverse effects on our investment income and we expect that such adverse effects will continue for some time.

These adverse effects may

require us to restructure certain of our investments, which could result in further reductions to our investment income or in impairments on our investments.

In addition, disruptions in the capital markets have resulted in illiquidity in

certain market areas.

COVID-19 has already had adverse effects on our investment income and we expect that such adverse

effects will continue for some time.

These adverse effects may require us to restructure certain of our investments, which could result in further reductions to our investment income or in impairments on our investments.

disruptions in the capital markets have resulted in illiquidity in certain market areas.

These market disruptions and illiquidity are likely to have an adverse effect on our business, financial condition, results of operations and cash flows.

Unfavorable economic conditions caused by

COVID-19 can also be expected to increase our funding costs and limit our access to the capital markets.

These events have limited our investment originations, which is likely to continue for the immediate

future, and have also had a material negative impact on our operating results.

We will continue to carefully monitor the

impact of the COVID-19 pandemic on our business and the business of our portfolio companies.

Because the full effects of the COVID-19 pandemic are not capable of being

known at this time, we cannot estimate the impacts of COVID-19 on our future financial condition, results of operations or cash flows.

We do, however, expect that it will continue to have a negative impact on

our business and the financial condition of our portfolio companies.

Portfolio Investment Activity for the Three and Six Months Ended

June 30, 2020 and for the Year Ended December 31, 2019

Total Portfolio Activity

The following tables present certain selected information regarding our portfolio investment activity for the three and six months ended

June 30, 2020 and the year ended December 31, 2019:

Net Investment Activity

For the Three Months Ended

June 30, 2020

For the Six Months

June 30, 2020

Sales and Repayments

Net Portfolio Activity

For the Three Months Ended

June 30, 2020

For the Six Months

June 30, 2020

New Investment Activity by Asset Class

Senior Secured LoansFirst Lien

Senior Secured LoansSecond Lien

Other Senior Secured Debt

Subordinated Debt

Unfavorable economic conditions caused by COVID-19 can also be expected to increase our funding costs and limit our access to the capital markets.

These events have limited our investment originations, which

is likely to continue for the immediate future, and have also had a material negative impact on our operating results.

continue to carefully monitor the impact of the COVID-19 pandemic on our business and the business of our portfolio companies.

Because the full effects of the COVID-19

pandemic are not capable of being known at this time, we cannot estimate the impacts of COVID-19 on our future financial condition, results of operations or cash flows.

We do, however, expect that it will

continue to have a negative impact on our business and the financial condition of our portfolio companies.

Portfolio Investment Activity

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.

What changed 10-Q

Item 1. Financial Statements