What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2021-03-01 compared with 2020-02-27 · 1573 added, 1573 removed, 2427 unchanged (56% 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.

2 unchanged sentences

Managements Report on Internal Control over Financial Reporting

Reports of Independent Registered Public Accounting Firm s

Reports of Independent Registered Public Accounting Firms

Consolidated Balance Sheets as of December 31, 2020 and 2019

5 unchanged sentences

Notes to Consolidated Financial Statements

MANAGEMENTS REPORT ON INTERNAL CONTROL OVER FINANCIAL

Our management is responsible for establishing and maintaining adequate internal control over financial

MANAGEMENTS REPORT ON INTERNAL CONTROL OVER

FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal control over

financial reporting.

In connection with the preparation of our annual financial statements, management has conducted an assessment of the effectiveness of our internal control over financial reporting based on the framework set forth in Internal

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internal control over financial reporting of FS KKR Capital Corp.

and subsidiaries (the Company) as of December 31, 2019, based on criteria established in Internal Control Integrated Framework (2013) issued by the

Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria

established in Internal Control Integrated Framework (2013) issued by COSO.

We have also audited, in

accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2019, of the Company and our report dated February 27,

2020, expressed an unqualified opinion on those financial statements.

and subsidiaries (the Company) as of December 31, 2020, based on criteria established in Internal Control Integrated Framework (2013) issued by the Committee

of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2020, based on criteria established in

Internal Control Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the

standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2020, of the Company and our report dated March 1, 2021, expressed an unqualified

opinion on those financial statements.

Basis for Opinion

The Companys management is responsible for maintaining effective internal control over financial reporting and for its assessment of

the effectiveness of internal control over financial reporting, included in the accompanying Managements Report on Internal Control over Financial Reporting.

Our responsibility is to express an opinion on the Companys internal control

over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and

regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards

of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an

understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other

procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion.

The Companys management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting,

included in the accompanying Managements Report on Internal Control over Financial Reporting.

Our responsibility is to express an opinion on the Companys internal control over financial reporting based on our audit.

We are a public

accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the

We conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform

the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing

the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.

that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A companys internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial

statements for external purposes in accordance with generally accepted accounting principles.

A companys internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that,

in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in

accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance

regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

A companys internal control over financial reporting is a process designed to provide reasonable assurance regarding

the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A companys internal control over financial reporting includes those policies

and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded

as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and

directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the companys assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections

of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte & Touche LLP

Francisco, California

February 27, 2020

San Francisco, California

March 1, 2021

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and the Board of Directors FS KKR Capital Corp.

To the Stockholders and the Board of Directors of FS KKR Capital Corp.

Opinion on the Financial Statements and Financial Highlights

audited the accompanying consolidated balance sheet of FS KKR Capital Corp.

and subsidiaries (the Company), including the consolidated schedule of investments, as of December 31, 2019, the related consolidated statements of

operations, cash flows, and changes in net assets for the year then ended, the financial highlights for the year ended December 31, 2019, and the related notes.

In our opinion, the financial statements and financial highlights present fairly,

in all material respects, the financial position of the Company as of December 31, 2019, and the results of its operations, changes in net assets, and cash flows for the year then ended, and the financial highlights for the year ended

December 31, 2019 in conformity with accounting principles generally accepted in the United States of America.

also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Companys internal control over financial reporting as of December 31, 2019, based on criteria established in

Internal Control Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 27, 2020, expressed an unqualified opinion on the Companys

internal control over financial reporting.

audited the accompanying consolidated balance sheets of FS KKR Capital Corp.

and subsidiaries (the Company), including the consolidated schedules of investments, as of December 31, 2020 and 2019, the related consolidated statements of

operations, changes in net assets, and cash flows for the years then ended, the financial highlights for the years then ended, and the related notes (collectively referred to as the financial statements).

In our opinion, the financial

statements present fairly, in all material respects, the financial position of the Company as of December 31, 2020 and 2019, and the results of its operations, changes in net assets, cash flows, and financial highlights for the years then ended, in

conformity with accounting principles generally accepted in the United States of America.

The consolidated financial

statements of the Company for the year ended December 31, 2018, before the effects of the adjustments to retrospectively apply the change in accounting related to the reverse stock split discussed in Note 1 to the financial statements, were audited

by other auditors whose report, dated February 27, 2019, expressed an unqualified opinion on those statements.

We have also audited the adjustments to the 2018 consolidated financial statements to retrospectively apply the change in accounting for

the reverse stock split in 2020, as discussed in Note 1 to the financial statements.

Our procedures included (1) comparing the amounts shown in the per share disclosures for 2018 to the Companys underlying accounting analysis, (2) comparing

the previously reported shares outstanding and the related balance sheet and income statement amounts per the Companys accounting analysis to the previously issued consolidated financial statements, and (3) recalculating the reduction of

shares to give effect to the reverse stock split and testing the mathematical accuracy of the underlying analysis.

In our opinion, such retrospective adjustments are appropriate and have been properly applied.

However, we were not engaged to audit,

review, or apply any procedures to the 2018 consolidated financial statements of the Company other than with respect to the retrospective adjustments, and accordingly, we do not express an opinion or any other form of assurance on the 2018

consolidated financial statements taken as a whole.

We have also audited, in accordance with the standards of the Public

Company Accounting Oversight Board (United States) (PCAOB), the Companys internal control over financial reporting as of December 31, 2020, based on criteria established in Internal Control Integrated Framework (2013) issued by

the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 1, 2021 expressed an unqualified opinion on the Companys internal control over financial reporting.

Basis for Opinion

These financial statements and financial highlights are the responsibility of the Companys management.

Our responsibility is to express an opinion on the Companys financial statements and

financial highlights based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and

regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards

of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements and financial

highlights, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements and financial

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights.

Our procedures included

confirmation of investments owned as of December 31, 2019, by correspondence with the custodian, loan agents, and borrowers;

financial statements and financial highlights are the responsibility of the Companys management.

Our responsibility is to express an opinion on the Companys financial statements and financial highlights based on our audits.

public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission

and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and

perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of

material misstatement of the financial statements and financial highlights, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and

disclosures in the financial statements and financial highlights.

Our audits also included evaluating the accounting

principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements and financial highlights.

Our procedures included confirmation of investments owned as of December 31, 2020 and

2019, by correspondence with the custodian, loan agents, and borrowers;

when replies were not received, we performed other auditing procedures.

We believe that our audit provides a reasonable

basis for our opinion.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and

that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way

our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Fair Value Level 3 Investments Refer to Notes 2 and 8 to the financial statements

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was

communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below,

providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Fair Value Level 3

Investments Refer to Notes 2, 6, and 8 to the financial statements

Critical Audit Matter Description

The Company held investments classified as Level 3 investments under accounting principles generally accepted in the United States of America.

These investments included illiquid corporate bonds and

loans, unlisted equity securities, and derivatives that lack observable market prices.

The valuation techniques used in estimating the fair value of these investments vary based on the specific characteristics of the investments and certain

significant inputs used were unobservable.

The Company held investments classified as Level 3 investments under accounting principles generally accepted in the United States of

These investments included illiquid corporate bonds and loans, unlisted equity securities, and derivatives that lack observable market prices.

The valuation techniques used in estimating the fair value of these investments vary based on the

specific characteristics of the investments and certain significant inputs used were unobservable.

The fair value of the Companys Level 3 investments was $5.8 billion as of December 31, 2020.

We identified the valuation of Level 3 investments as a critical audit matter

because of the judgments necessary for management to select valuation techniques and to use significant unobservable inputs to estimate the fair value.

This required a high degree of auditor judgement and extensive audit effort, including the need

to involve fair value specialists who possess significant valuation experience, to evaluate the appropriateness of the valuation techniques and the significant unobservable inputs, when performing audit procedures to audit managements estimate

of fair value of Level 3 investments.

We identified the valuation of Level 3 investments as a critical audit matter because of the judgments necessary for management to select

valuation techniques and to use significant unobservable inputs to estimate the fair value.

This required a high degree of auditor judgment and extensive audit effort, including the need to involve fair value specialists who possess significant

valuation experience, to evaluate the appropriateness of the valuation techniques and the significant unobservable inputs, when performing audit procedures to audit managements estimate of fair value of Level 3 investments.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to valuation techniques and unobservable observable inputs used by management to estimate the fair value of

Level 3 investments included the following, among others:

We tested the effectiveness of controls over managements valuation of Level 3 investments, including those related to valuation techniques

and significant unobservable inputs.

We evaluated the appropriateness of the valuation techniques used for Level 3 investments and tested the related significant unobservable inputs

by comparing these inputs to external sources.

We evaluated the reasonableness of any significant changes in valuation techniques or significant unobservable inputs.

For a selected sample of Level 3 investments, we performed these procedures

with the assistance of our fair value specialists.

Our audit procedures related to valuation techniques and unobservable observable inputs used by management to estimate the fair value of Level 3 investments included the following, among others:

We tested the effectiveness of controls over managements valuation of Level 3 investments, including those related to valuation techniques and

significant unobservable inputs.

We evaluated the appropriateness of the valuation techniques used for Level 3 investments and tested the related significant unobservable inputs by

comparing these inputs to external sources.

We evaluated the reasonableness of any significant changes in valuation techniques or significant unobservable inputs, including the considerations of the impact of COVID 19.

For a selected sample of Level

3 investments, we performed these procedures with the assistance of our fair value specialists.

In instances where the selection of valuation techniques or significant unobservable inputs were more subjective, with the assistance of our fair value

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transactions, taking into account changes in market or investment specific conditions, where applicable.

Deloitte & Touche LLP

San Francisco, California

February 27, 2020

March 1, 2021

We have served as the Companys auditor since 2019.

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Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet, including the consolidated schedule of investments, of FS KKR Capital Corp.

(the Company) as of December 31, 2018, and the related consolidated statements of operations, changes in net assets and cash flows for each of the two years in the period ended December 31, 2018, and the related notes to the consolidated financial

statements (collectively, the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of FS KKR Capital Corp.

as of December 31, 2018, and the results of its operations and its

cash flows for each of the two years in the period ended December 31, 2018 in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying consolidated statements of operations, changes in net assets and cash flows of FS KKR Capital Corp.

Company) for the year ended December 31, 2018, and the related notes to the consolidated financial statements (collectively, the financial statements).

In our opinion, except for the effects of the adjustments, if any, as might have been determined

to be necessary had we been engaged to audit the Companys restatement of share and per-share information, as described below, the financial statements present fairly, in all material respects, the results of the Companys operations and

its cash flows for the year ended December 31, 2018, in conformity with accounting principles generally accepted in the United States of America.

Reverse Stock Split

We were not engaged to audit the restatement of the

Companys disclosures about share and per-share information for the year ended December 31, 2018, as discussed in Note 3 to the financial statements.

Basis for Opinion

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Companys management.

Our responsibility is to express an opinion on the Companys financial statements based on our audits.

Our responsibility is to express an opinion on the Companys financial statements based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the

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federal securities laws and applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are

free of material misstatement, whether due to error or fraud.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond

to those risks.

Except as discussed above, we conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the

financial statements are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing

procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by

management, as well as evaluating the overall presentation of the financial statements.

Our procedures included confirmation of securities owned as of December 31, 2018 by correspondence with the custodians and brokers or by other appropriate

auditing procedures where replies from brokers were not received.

We believe that our audits provide a reasonable basis for our opinion.

We have served as the auditor of one or more FS Investments investment companies since 2007.

Our audit also included evaluating the accounting principles used and

significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

/s/ RSM US LLP

We have served as the auditor of one or more FS Investments investment companies

Blue Bell, Pennsylvania

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Consolidated Balance Sheets

(in millions,

except share and per share amounts)

(in millions, except share and per share

Investments, at fair value

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Deferred financing costs

Deferred merger costs

Prepaid expenses and other assets

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Debt (net of deferred financing costs of $23 and $9, respectively) (1)

Unrealized depreciation on swap contracts

Unrealized depreciation on foreign currency forward contracts

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Interest payable

Directors fees payable

Other accrued expenses and liabilities

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Common stock, $0.001 par value, 750,000,000 shares authorized, 123,755,965 and 126,581,766 shares issued and outstanding,

respectively (4)

Capital in excess of par value

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See Note 10 for a discussion of the Companys commitments and contingencies.

As discussed in Notes 1 and 3, the Company completed a Reverse Stock Split, effective as of June 15, 2020.

The outstanding shares and net

asset value per common share reflect the Reverse Stock Split on a retroactive basis.

See Note 5 for a discussion of the sources of distributions paid by the Company.

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Paid-in-kind interest income

Dividend income

From controlled/affiliated investments:

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Interest expense (3)

Directors fees

Other general and administrative expenses

5 unchanged sentences

FS KKR Capital Corp.

Consolidated Statements of Operations (continued)

Consolidated Statements of Operations

(in millions, except share and per share amounts)

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Net realized gain (loss) on foreign currency forward contracts

Net realized gain (loss) on secured borrowing

Net realized gain (loss) on foreign currency

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Net change in unrealized appreciation (depreciation) on foreign currency forward contracts

Net change in unrealized appreciation (depreciation) on secured borrowing

Net change in unrealized gain (loss) on foreign currency

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from operations would have been $(2.36).

As discussed in Notes 1 and 3, the Company completed a Reverse Stock Split, effective as of June 15, 2020.

The weighted average shares

used in the per share computation of the net increase (decrease) in net assets resulting from operations reflect the Reverse Stock Split on a retroactive basis.

See notes to consolidated financial statements.

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Year Ended December 31,

Net investment income (loss)

Net investment income

Net realized gain (loss) on investments, swap contracts, secured borrowing and foreign currency

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(Increase) decrease in income receivable

(Increase) decrease in deferred merger costs

(Increase) decrease in prepaid expenses and other assets

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Borrowings under unsecured notes (2)

Secured borrowing (2)

Repayments of credit facilities (2)

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For the year ended December 31, 2018, excludes $1,928 of debt assumed from the 2018 Merger.

See Note 9 for a discussion of the Companys

financing arrangements.

See Note 9 for a discussion of the

Companys financing arrangements.

During the years ended December 31, 2020, 2019 and 2018, the Company paid $156, $171 and $82, respectively, in interest expense on the credit facilities and unsecured notes.

Supplemental disclosure of non-cash operating and financing activities:

In connection with the Merger on December 19, 2018, the Company issued common stock of $1,574 and acquired investments at fair value of $4,168 ($4,428 at

cost) and other assets of $64 and assumed debt of $1,928 and other liabilities of $210.

See notes to consolidated financial

In connection with the 2018 Merger, the Company issued common stock of $1,574 and acquired investments at fair value of $4,168 ($4,428 at cost) and other

assets of $64 and assumed debt of $1,928 and other liabilities of $210 during the year ended December 31, 2018.

notes to consolidated financial statements.

FS KKR Capital Corp.

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(in millions, except share amounts)

Portfolio Company (a)

Senior Secured LoansFirst Lien111.4%

2 unchanged sentences

5 Arch Income Fund 2 LLC

(l)(n)(q)(v)(w)

Diversified Financials

8 unchanged sentences

Capital Goods

Acproducts Inc

Consumer Durables & Apparel

Advanced Lighting Technologies Inc

Advantage Sales & Marketing Inc

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

L+400 PIK (L+400 Max PIK)

AM General LLC

Capital Goods

American Tire Distributors Inc

Automobiles & Components

Ammeraal Beltech Holding BV

Capital Goods

L+750, 0.0% PIK (1.5% Max PIK)

Amtek Global Technology Pte Ltd

6 unchanged sentences

Diversified Financials

Apex Group Limited

Diversified Financials

Ardonagh Group Ltd

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

Ardonagh Group Ltd

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

Aspect Software Inc

Software & Services

8.0% PIK (8.0% Max PIK)

Aspect Software Inc

Software & Services

athenahealth Inc

Health Care Equipment & Services

AVF Parent LLC

L+925 PIK (L+925 Max PIK)

Bellatrix Exploration Ltd

Berner Food & Beverage LLC

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

Food, Beverage & Tobacco

Brand Energy & Infrastructure Services Inc

Capital Goods

Camping World Good Sam

Consumer Durables & Apparel

CEPSA Holdco (Matador Bidco)

CHS/Community Health Systems, Inc.

Health Care Equipment & Services

Commercial Barge Line Co

Transportation

Compassus LLC

Health Care Equipment & Services

Capital Goods

Charles Taylor PLC

Diversified Financials

Capital Goods

5 unchanged sentences

Food, Beverage & Tobacco

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

Distribution International Inc

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Eagle Family Foods Inc

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Food, Beverage & Tobacco

Eagle Family Foods Inc

Food, Beverage & Tobacco

Electronics For Imaging Inc

Technology Hardware & Equipment

Empire Today LLC

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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)

FloWorks International LLC

Capital Goods

FloWorks International LLC

Capital Goods

FloWorks International LLC

Capital Goods

Frontline Technologies Group LLC

Software & Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2020

(in millions, except share amounts)

Portfolio Company (a)

Frontline Technologies Group LLC

Software & Services

Greystone & Co Inc

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Diversified Financials

Greystone Equity Member Corp

Diversified Financials

Heniff Transportation Systems LLC

4 unchanged sentences

Transportation

Heniff Transportation Systems LLC

Transportation

HM Dunn Co Inc

6 unchanged sentences

Commercial & Professional Services

Hunt Mortgage

Diversified Financials

Icynene Group Ltd

Commercial & Professional Services

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

Commercial & Professional Services

Imagine Communications Corp

Media & Entertainment

Imagine Communications Corp

Media & Entertainment

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

Individual FoodService

Capital Goods

Individual FoodService

Capital Goods

Individual FoodService

Capital Goods

Individual FoodService

Capital Goods

Industria Chimica Emiliana Srl

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10.8%, 1.0% PIK (1.0% Max PIK)

JHT Holdings Inc

Capital Goods

Jarrow Formulas Inc

Household & Personal Products

Jo-Ann Stores Inc

Consumer Services

Kellermeyer Bergensons Services LLC

2 unchanged sentences

Commercial & Professional Services

Kellermeyer Bergensons Services LLC

Commercial & Professional Services

Kodiak BP LLC

4 unchanged sentences

Commercial & Professional Services

Technology Hardware & Equipment

Commercial & Professional Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Commercial & Professional Services

Lionbridge Technologies Inc

Consumer Services

Lipari Foods LLC

2 unchanged sentences

Food & Staples Retailing

Lipari Foods LLC

Food & Staples Retailing

Matchesfashion Ltd

Consumer Durables & Apparel

MB Precision Holdings LLC

Capital Goods

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

MI Windows & Doors Inc

Capital Goods

Miami Beach Medical Group LLC

Health Care Equipment & Services

Miami Beach Medical Group LLC

Health Care Equipment & Services

Micronics Filtration Holdings Inc

Capital Goods

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

Motion Recruitment Partners LLC

Commercial & Professional Services

7.5% PIK (7.5% Max PIK)

Motion Recruitment Partners LLC

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Commercial & Professional Services

Multi-Color Corp

Commercial & Professional Services

Consumer Durables & Apparel

Software & Services

North Haven Cadence Buyer Inc

Consumer Services

North Haven Cadence Buyer Inc

Consumer Services

North Haven Cadence Buyer Inc

Consumer Services

North Haven Cadence Buyer Inc

Consumer Services

One Call Care Management Inc

Ontic Engineering & Manufacturing Inc

Capital Goods

Ontic Engineering & Manufacturing Inc

L+500, 2.5% PIK (2.5% Max PIK)

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2020

(in millions, except share amounts)

Portfolio Company (a)

Omnimax International Inc

Capital Goods

Telecommunication Services

PAE Holding Corp

Omnimax International Inc

Capital Goods

Peak 10 Holding Corp

Telecommunication Services

One Call Care Management Inc

Health Care Equipment & Services

P2 Energy Solutions Inc.

Software & Services

P2 Energy Solutions Inc.

Software & Services

P2 Energy Solutions Inc.

Software & Services

Petroplex Acidizing Inc

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

Power Distribution Inc

Capital Goods

L+900 PIK (L+900 Max PIK)

Polyconcept North America Inc

Household & Personal Products

L+450 PIK (L+450 Max PIK)

Premium Credit Ltd

Diversified Financials

Project Marron

1 unchanged sentence

Health Care Equipment & Services

Qdoba Restaurant Corp

Consumer Services

Quorum Health Corp

Health Care Equipment & Services

Reliant Rehab Hospital Cincinnati LLC

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

Safariland LLC

Capital Goods

Safariland LLC

Capital Goods

Safe-Guard Products International LLC

Diversified Financials

L+800, 0.8% PIK (0.8% Max PIK)

C+850, 0.8% PIK (0.8% Max PIK)

Capital Goods

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

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Sequel Youth & Family Services LLC

4 unchanged sentences

Consumer Durables & Apparel

Smart Foodservice

Food & Staples Retailing

SMART Global Holdings Inc

Semiconductors & Semiconductor Equipment

Sorenson Communications LLC

Telecommunication Services

Staples Canada

Sound United LLC

Consumer Durables & Apparel

Sungard Availability Services Capital Inc

Software & Services

L+375, 3.8% PIK (3.8% Max PIK)

Sungard Availability Services Capital Inc

Software & Services

Sutherland Global Services Inc

Software & Services

L+375, 3.8% PIK (3.8% Max PIK)

Sweeping Corp of America Inc

Commercial & Professional Services

Sweeping Corp of America Inc

Commercial & Professional Services

Sweeping Corp of America Inc

Commercial & Professional Services

Sweet Harvest Foods Management Co

1 unchanged sentence

L+775, 1.0% PIK (1.0% Max PIK)

Software & Services

Sweet Harvest Foods Management Co

Food & Staples Retailing

L+775, 1.0% PIK (1.0% Max PIK)

Software & Services

Team Health Inc

Health Care Equipment & Services

ThermaSys Corp

Capital Goods

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

ThreeSixty Group

L+375, 3.8% PIK (3.8% Max PIK)

ThreeSixty Group

Total Safety US Inc

Capital Goods

L+375, 3.8% PIK (3.8% Max PIK)

Software & Services

Transaction Services Group Ltd

Consumer Services

Software & Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2020

(in millions, except share amounts)

Portfolio Company (a)

Transaction Services Group Ltd

Consumer Services

Software & Services

Transaction Services Group Ltd

Software & Services

Truck-Lite Co LLC

Automobiles & Components

Capital Goods

Truck-Lite Co LLC

Automobiles & Components

Capital Goods

Truck-Lite Co LLC

Automobiles & Components

Capital Goods

Utility One Source LP

Capital Goods

Vertiv Group Corp

Technology Hardware & Equipment

Virgin Pulse Inc

Software & Services

Commercial & Professional Services

Warren Resources Inc

10 unchanged sentences

Transportation

Yak Access LLC

Capital Goods

Zeta Interactive Holdings Corp

Software & Services

Wheels Up Partners LLC

Transportation

Zeta Interactive Holdings Corp

2 unchanged sentences

Unfunded Loan Commitments

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Net Senior Secured LoansFirst Lien

2 unchanged sentences

Capital Goods

Access CIG LLC

Software & Services

Advantage Sales & Marketing Inc

Commercial & Professional Services

Agro Merchants Global LP

Transportation

Albany Molecular Research Inc

Pharmaceuticals, Biotechnology & Life Sciences

Amtek Global Technology Pte Ltd

Automobiles & Components

Amtek Global Technology Pte Ltd

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

Automobiles & Components

Arena Energy LP

L+900, 4.0% PIK (4.0% Max PIK)

E+500 PIK (E+500 Max PIK)

athenahealth Inc

Health Care Equipment & Services

Bellatrix Exploration Ltd

Byrider Finance LLC

1 unchanged sentence

L+1,000, 0.5% PIK (0.5% Max PIK)

Chisholm Oil & Gas Operating LLC

L+550, 3.0% PIK (3.0% Max PIK)

CommerceHub Inc

Software & Services

Culligan International Co

Household & Personal Products

EaglePicher Technologies LLC

Capital Goods

Electronics For Imaging Inc

Technology Hardware & Equipment

Emerald Performance Materials LLC

Excelitas Technologies Corp

Technology Hardware & Equipment

Software & Services

Gruden Acquisition Inc

Transportation

LBM Borrower LLC

Capital Goods

MedAssets Inc

Health Care Equipment & Services

Software & Services

Consumer Durables & Apparel

L+1,275 PIK (L+1,275 Max PIK)

NEP Broadcasting LLC

2 unchanged sentences

Software & Services

Ontic Engineering & Manufacturing Inc

Capital Goods

P2 Energy Solutions, Inc.

Software & Services

Paradigm Acquisition Corp

6 unchanged sentences

Household & Personal Products

11.0% PIK (11.0% Max PIK)

Pretium Packaging LLC

Household & Personal Products

Pure Fishing Inc

2 unchanged sentences

Food, Beverage & Tobacco

SIRVA Worldwide Inc

Commercial & Professional Services

Capital Goods

L+1,075, 0.0% PIK (6.8% Max PIK)

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2020

(in millions, except share amounts)

Portfolio Company (a)

Sorenson Communications LLC

Telecommunication Services

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

Sound United LLC

Consumer Durables & Apparel

13.5% PIK (13.5% Max PIK)

6 unchanged sentences

Consumer Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

WireCo WorldGroup Inc

3 unchanged sentences

E+850, 0.5% PIK (0.5% Max PIK)

Z Gallerie LLC

Total Senior Secured LoansSecond Lien

6 unchanged sentences

Black Swan Energy Ltd

Cleaver-Brooks Inc

Capital Goods

Enterprise Development Authority

Consumer Services

FourPoint Energy LLC

JW Aluminum Co

Consumer Durables & Apparel

Maxim Crane Works LP / Maxim Finance Corp

Capital Goods

Mood Media Corp

Media & Entertainment

L+1,400 PIK (L+1,400 Max PIK)

MultiPlan Inc

Health Care Equipment & Services

Pattonair Holdings Ltd

Capital Goods

Rockport (Relay)

Consumer Durables & Apparel

15.0% PIK (15.0% Max PIK)

Capital Goods

Velvet Energy Ltd

Commercial & Professional Services

Total Other Senior Secured Debt

Subordinated Debt5.5%

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

1 unchanged sentence

14.0% PIK (14.0% Max PIK)

DEI Sales Inc

Consumer Durables & Apparel

13.0% PIK (13.0% Max PIK)

Diamond Resorts International Inc

Consumer Services

GFL Environmental Inc

Commercial & Professional Services

Hilding Anders

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

Consumer Durables & Apparel

13.0% PIK (13.0% Max PIK)

Hilding Anders

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

Consumer Durables & Apparel

12.0% PIK (12.0% Max PIK)

Hilding Anders

2 unchanged sentences

13.0% PIK (13.0% Max PIK)

Hilding Anders

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

Consumer Durables & Apparel

18.0% PIK (18.0% Max PIK)

Imagine Communications Corp

Media & Entertainment

Legends Hospitality LLC

Consumer Services

L+1,000 PIK (L+1,000 Max PIK)

Total Subordinated Debt

Unfunded Debt Commitments

Net Subordinated Debt

Asset Based Finance30.8%

801 5th Ave, Seattle, Private Equity

801 5th Ave, Seattle, Structure Mezzanine

8.0%, 3.0% PIK (3.0% Max PIK)

Kenan Advantage Group Inc

Transportation

LifePoint Hospitals Inc

Health Care Equipment & Services

Nouryon (fka Akzo Nobel Specialty Chemicals)

PAREXEL International Corp

Pharmaceuticals, Biotechnology & Life Sciences

Abacus JV, Private Equity

notes to consolidated financial statements.

3 unchanged sentences

(in millions, except share amounts)

Plastipak Holdings Inc

Ply Gem Holdings Inc

Capital Goods

Quorum Health Corp

Health Care Equipment & Services

SRS Distribution Inc

Capital Goods

Team Health Inc

Health Care Equipment & Services

Vertiv Group Corp

Technology Hardware & Equipment

Commercial & Professional Services

Z Gallerie LLC

Total Subordinated Debt

Asset Based Finance19.1%

801 5th Ave, Seattle, Structure Mezzanine

8.0%, 0.0% PIK (3.0% Max PIK)

801 5th Ave, Seattle, Private Equity

Abacus JV, Private Equity

Accelerator Investments Aggregator LP, Private Equity

6 unchanged sentences

Transportation

Avida Holding AB, Common Stock

Diversified Financials

Bank of Ireland, Class B Credit Linked Floating Rate Note

Byrider Finance LLC, Structured Mezzanine

Automobiles & Components

Byrider Finance LLC, Structured Mezzanine

Automobiles & Components

Byrider Finance LLC, Sub Note

Automobiles & Components

Callodine Commercial Finance LLC, 2L Term

Diversified Financials

Callodine Commercial Finance LLC, 2L Term

Diversified Financials

Capital Automotive LP, Private Equity

Capital Automotive LP, Structured Mezzanine

11.0% PIK (11.0% Max PIK)

Global Jet Capital LLC, Preferred Stock

Commercial & Professional Services

Global Jet Capital LLC, Structured Mezzanine

34 unchanged sentences

15.0% PIK (15.0% Max PIK)

Global Jet Capital LLC, Preferred Stock

Commercial & Professional Services

Global Lending Services LLC, Private Equity

Diversified Financials

Global Lending Services LLC, Private Equity

Diversified Financials

Home Partners JV, Common Stock

Home Partners JV, Private Equity

(g)(l)(n)(x)(y)

Home Partners JV, Structured Mezzanine

2 unchanged sentences

11.0% PIK (11.0% Max PIK)

Home Partners JV, Common Stock

Home Partners JV, Private Equity

(g)(l)(n)(x)(y)

Kilter Finance, Preferred Stock

6.0%, 6.0% PIK (6.0% Max PIK)

Kilter Finance, Private Equity

KKR Central Park Leasing Aggregator L.P., Partnership Interest

Capital Goods

KKR Zeno Aggregator LP (K2 Aviation), Partnership Interest

Capital Goods

notes to consolidated financial statements.

3 unchanged sentences

(in millions, except share amounts)

KKR Central Park Leasing Aggregator L.P., Partnership Interest

Capital Goods

KKR Zeno Aggregator LP (K2 Aviation), Partnership Interest

Capital Goods

Portfolio Company(a)

Lenovo Group Ltd, Structured Mezzanine

2 unchanged sentences

Technology Hardware & Equipment

Opendoor Labs Inc, 2L Term Loan

Orchard Marine Limited, Class B Common Stock

2 unchanged sentences

Transportation

Prime ST LLC, Private Equity

Prime ST LLC, Structured Mezzanine

5.0%, 6.0% PIK (6.0% Max PIK)

Rampart CLO 2007 1A Class Subord.

Diversified Financials

Sofi Lending Corp, 2019-C R1

Sofi Lending Corp, Purchase Facility

Diversified Financials

2 unchanged sentences

Toorak Capital Funding LLC, Membership Interest

Diversified Financials

Toorak Capital LLC, Membership Interest

Diversified Financials

Toorak Capital Partners LLC, Private Equity

Wind River CLO Ltd.

8 unchanged sentences

Total Strategic Credit Opportunities Partners

Equity/Other14.8% (k)

Portfolio Company (a)

Equity/Other17.1% (m)

Advanced Lighting Technologies Inc, Common Stock

4 unchanged sentences

Commercial & Professional Services

AltEn, LLC, Membership Units

Amtek Global Technology Pte Ltd, Ordinary Shares

1 unchanged sentence

5,735,804,056

Amtek Global Technology Pte Ltd, Private Equity

Automobiles & Components

Amtek Global Technology Pte Ltd, Trade Claim

4 unchanged sentences

Capital Goods

Ardonagh Ltd, Ordinary Shares

Ardonagh Ltd, Preferred Stock

Arena Energy LP, Warrants

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2020

(in millions, except share amounts)

Portfolio Company (a)

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

4 unchanged sentences

Software & Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Aspect Software Inc, Common Stock

2 unchanged sentences

Software & Services

AVF Parent LLC, Trade Claim

Belk Inc, Units

Bellatrix Exploration Ltd, Warrant

Byrider Finance LLC, Common Stock

Automobiles & Components

Borden (New Dairy Opco), Common Stock

Food, Beverage & Tobacco

Cengage Learning, Inc, Common Stock

2 unchanged sentences

Chisholm Oil & Gas Operating LLC, Series A Units

CSafe Global, Common Stock

Capital Goods

CTI Foods Holding Co LLC, Common Stock

Food, Beverage & Tobacco

DEI Sales Inc, Class A Units

Consumer Durables & Apparel

DEI Sales Inc, Series I Units

Consumer Durables & Apparel

DEI Sales Inc, Series II Units

Consumer Durables & Apparel

Directed LLC, Warrant

1 unchanged sentence

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

Fronton BV, Common Stock

2 unchanged sentences

Technology Hardware & Equipment

Genesys Telecommunications Laboratories Inc, Class A1A5 Shares

Technology Hardware & Equipment

Genesys Telecommunications Laboratories Inc, Ordinary Shares

Technology Hardware & Equipment

Genesys Telecommunications Laboratories Inc, Ordinary Shares

Technology Hardware & Equipment

Genesys Telecommunications Laboratories Inc, Preferred Stock

2 unchanged sentences

Capital Goods

Hilding Anders, ARLE PIK Interest

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

Consumer Durables & Apparel

12.0% PIK (12.0% Max PIK)

Hilding Anders, Class A Common Stock

14 unchanged sentences

Media & Entertainment

JHC Acquisition LLC, Common Stock

Capital Goods

Jones Apparel Holdings, Inc., Common Stock

Consumer Durables & Apparel

JSS Holdings Ltd, Net Profits Interest

Capital Goods

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

JW Aluminum Co, Common Stock

JW Aluminum Co, Preferred Stock

Keystone Australia Holdings Pty Limited, Residual Claim

Consumer Services

KKR BPT Holdings Aggregator LLC, Membership Interest

Diversified Financials

MB Precision Holdings LLC, Preferred Stock

Capital Goods

12.5% PIK (12.5% Max PIK)

Maverick Natural Resources, Common Stock

MB Precision Holdings LLC, Class A2 Units

Capital Goods

Miami Beach Medical Group LLC, Common Stock

Health Care Equipment & Services

Micronics Filtration Holdings Inc, Common Stock

2 unchanged sentences

Capital Goods

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2020

(in millions, except share amounts)

Portfolio Company (a)

Micronics Filtration Holdings Inc, Preferred Stock, Series B

Capital Goods

Mood Media Corp, Common Stock

Media & Entertainment

Micronics Filtration Holdings Inc, Preferred Stock, Series B PIK

Capital Goods

3.0% PIK (3.0% Max PIK)

Micronics Filtration Holdings Inc, Preferred Stock, Series C PIK

Capital Goods

7.5% PIK (7.5% Max PIK)

NBG Home, Common Stock

2 unchanged sentences

Consumer Durables & Apparel

North Haven Cadence Buyer Inc, Common Stock

Consumer Services

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)

4 unchanged sentences

Household & Personal Products

Power Distribution Inc, Common Stock

Capital Goods

Proserv Acquisition LLC, Class A Common Units

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

Rockport (Relay), Warrant

Consumer Durables & Apparel

Safariland LLC, Common Equity

Capital Goods

Sequential Brands Group Inc., Common Stock

2 unchanged sentences

Telecommunication Services

Sound United LLC, Class A Units

Consumer Durables & Apparel

Sound United LLC, Common Stock

Consumer Durables & Apparel

Sound United LLC, Series I Units

Consumer Durables & Apparel

Sound United LLC, Series II Units

Consumer Durables & Apparel

SSC (Lux) Limited S.a r.l., Common Stock

4 unchanged sentences

Software & Services

Sunnova Energy International Inc, Common Stock

Sweet Harvest Foods Management Co, Warrant

Food & Staples Retailing

ThermaSys Corp, Common Stock

(e)(f)(g)(n)(y)

Capital Goods

1 unchanged sentence

Capital Goods

Towergate, Preferred Stock

Towergate, Ordinary Shares

Trace3 Inc, Common Stock

2 unchanged sentences

Warren Resources Inc, Common Stock

Z Gallerie LLC, Common Stock

Zeta Interactive Holdings Corp, Preferred Stock, Series E1

Software & Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Zeta Interactive Holdings Corp, Preferred Stock, Series F

4 unchanged sentences

TOTAL INVESTMENTS219.0%

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2020

(in millions, except share amounts)

Portfolio Company (a)

LIABILITIES IN EXCESS OF OTHER ASSETS(119.0%)

13 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 December 31, 2019, the three-month London Interbank Offered Rate, or LIBOR or L, was 1.91%, the Euro Interbank Offered Rate, or EURIBOR, was (0.38)% and the U.S.

As of December 31, 2020, the three-month London Interbank Offered Rate, or LIBOR or L, was 0.24%, the Euro Interbank Offered Rate, or EURIBOR, was (0.55)%, Canadian Dollar Offer Rate, or CDOR, was 0.48% and the

Prime Lending Rate, or Prime, was 3.25%.

means paid-in-kind.

PIK means paid-in-kind.

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

2 unchanged sentences

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

term loan facility with JPMorgan Chase Bank, N.A.

(see Note 9).

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

2 unchanged sentences

(see Note 9).

Security or portion thereof held within FS KKR MM CLO 1 LLC (see Note 9).

Security or portion thereof was held within CCT Tokyo Funding LLC and was pledged as collateral supporting the amounts outstanding under the

revolving credit facility with Sumitomo Mitsui Banking Corporation (see Note 9).

notes to consolidated financial statements.

3 unchanged sentences

(in millions, except share amounts)

Security or portion thereof held within FS KKR MM CLO 1 LLC (see Note 9).

Security or portion thereof was held within CCT Tokyo Funding LLC and was pledged as collateral supporting the amounts outstanding under the

revolving credit facility with Sumitomo Mitsui Banking Corporation (see Note 9).

Security or portion thereof was held within CCT Dublin Funding Limited

Position or portion thereof unsettled as of December 31, 2019.

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

8 unchanged sentences

Security held within IC Arches Investments LLC, a wholly-owned subsidiary of the Company.

Security held within IC Altus Investments, LLC, a wholly-owned subsidiary of the Company.

Security held within CCT Holdings, LLC, a wholly-owned subsidiary of the Company.

Security held within CCT Holdings II, LLC, a wholly-owned subsidiary of the Company.

Security held within FCF, LLC, a wholly-owned subsidiary of the Company.

Security is an unfunded commitment.

20 unchanged sentences

Senior Secured LoansFirst Lien

Aspect Software Inc (4)

Charlotte Russe Inc

Borden (New Dairy Opco)

Borden Dairy Co (4)

HM Dunn Co Inc

1 unchanged sentence

MB Precision Holdings LLC

Micronics Filtration Holdings Inc (4)

One Call Care Management Inc

3 unchanged sentences

ThermaSys Corp

Z Gallerie LLC

Senior Secured LoansSecond Lien

3 unchanged sentences

Mood Media Corp

Rockport (Relay) (4)

Subordinated Debt

Z Gallerie LLC

Asset Based Finance

Home Partners JV, Structured Mezzanine

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, Warrants

Aspect Software Inc, Common Stock (4)

Borden (New Dairy Opco), Common Stock

Charlotte Russe Inc, Common Stock

1 unchanged sentence

HM Dunn Co Inc, Preferred Stock, Series A

HM Dunn Co Inc, Preferred Stock, Series B

notes to consolidated financial statements.

10 unchanged sentences

Fair Value at

HM Dunn Co Inc, Preferred Stock, Series B

Home Partners of America Inc, Common Stock

4 unchanged sentences

MB Precision Holdings LLC, Preferred Stock

Micronics Filtration Holdings Inc, Common

Micronics Filtration Holdings Inc, Preferred Stock, Series

Micronics Filtration Holdings Inc, Preferred Stock, Series B PIK (4)

Micronics Filtration Holdings Inc, Preferred Stock, Series C PIK (4)

Mood Media Corp, Common Stock

Mood Media LLC, Class A Warrants

Mood Media LLC, Class B Warrants

Mood Media LLC, Class C Warrants

One Call Care Management Inc, Common Stock

5 unchanged sentences

Proserv Acquisition LLC, Class A Preferred Units

Rockport (Relay), Class A

Safariland LLC, Common Equity

6 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 and PIK income presented for the full year ended December 31, 2019.

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

company or deemed to control the portfolio company as of December 31, 2019.

Transfers in or out have been presented at amortized cost.

The Company held this investment as of December 31, 2018 but it was deemed to control the portfolio company as of

December 31, 2018.

Transfers in or out have been presented at amortized cost.

Interest, PIK, fee and dividend income presented for the full year ended December 31, 2020.

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

company or deemed to control the portfolio company as of December 31, 2018.

company as of December 31, 2019.

Transfers in or out have been presented at amortized cost.

22 unchanged sentences

Amtek Global Technology Pte Ltd

Sound United LLC

Senior Secured LoansSecond Lien

Amtek Global Technology Pte Ltd

Sound United LLC

Other Senior Secured Debt

Advanced Lighting Technologies Inc

JW Aluminum Co (4)

Subordinated Debt

3 unchanged sentences

Hilding Anders

Asset Based Finance

1 unchanged sentence

801 5th Ave, Seattle, Private Equity

Comet Aircraft S.a.r.l., Common Stock

Toorak Capital LLC, Membership Interest

Avida Holding AB, Common Stock

Kilter Finance, Preferred Stock

Kilter Finance, Private Equity

Prime ST LLC, Private Equity

Prime ST LLC, Structured Mezzanine

Toorak Capital Funding LLC, Membership Interest

Toorak Capital Partners LLC, Private Equity

Strategic Credit Opportunities Partners, LLC

4 unchanged sentences

Amtek Global Technology Pte Ltd, Trade Claim

Amtek Global Technology Pte Ltd, Private Equity

Hilding Anders, ARLE PIK Interest

Hilding Anders, Class A Common Stock

Hilding Anders, Class B Common Stock

Hilding Anders, Class C Common Stock

Hilding Anders, Equity Options

JW Aluminum Co, Common Stock (4)

JW Aluminum Co, Preferred Stock (4)

notes to consolidated financial statements.

10 unchanged sentences

Fair Value at

Hilding Anders, Class B Common Stock

Hilding Anders, Class C Common Stock

Hilding Anders, Equity Options

KKR BPT Holdings Aggregator LLC, Membership Interest

Sound United LLC, Class A Units

Sound United LLC, Common Stock

Sound United LLC, Series I Units

Sound United LLC, Series II Units

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

3 unchanged sentences

Interest, PIK and dividend income presented for the full year ended December 31, 2020.

The Company held this investment as of December 31, 2019 but it was not deemed to control the portfolio company as of

December 31, 2019.

Transfers in or out have been presented at amortized cost.

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Senior Secured LoansFirst Lien96.3%

12 unchanged sentences

Capital Goods

Acosta Holdco Inc

Commercial & Professional Services

Addison Holdings

Commercial & Professional Services

Advanced Lighting Technologies Inc

1 unchanged sentence

Commercial & Professional Services

Aleris International Inc

Alion Science & Technology Corp

2 unchanged sentences

Commercial & Professional Services

L+400 (L+400 Max PIK)

Altus Power America Inc

All Systems Holding LLC

Commercial & Professional Services

All Systems Holding LLC

Commercial & Professional Services

L+400 PIK (L+400 Max PIK)

AM General LLC

Capital Goods

American Tire Distributors Inc

Automobiles & Components

Ammeraal Beltech Holding BV

2 unchanged sentences

Automobiles & Components

AP Plasman Inc

Capital Goods

Apex Group Limited

4 unchanged sentences

Diversified Financials

Apex Group Limited

Diversified Financials

Apex Group Limited

Diversified Financials

Aspect Software Inc

Software & Services

L+400, 6.5% PIK (6.5% Max PIK)

Aspect Software Inc

Software & Services

athenahealth Inc

Health Care Equipment & Services

AVF Parent LLC

L+925 PIK (L+925 Max PIK)

Bellatrix Exploration Ltd

Berner Food & Beverage LLC

Food & Staples Retailing

Blackhawk Mining LLC

Borden Dairy Co

Food, Beverage & Tobacco

Caprock Midstream LLC

Charlotte Russe Inc

Brand Energy & Infrastructure Services Inc

Capital Goods

Camping World Good Sam

Consumer Durables & Apparel

CEPSA Holdco (Matador Bidco)

CHS/Community Health Systems, Inc.

Health Care Equipment & Services

Commercial Barge Line Co

Transportation

Compassus LLC

Health Care Equipment & Services

Capital Goods

1 unchanged sentence

Capital Goods

CSM Bakery Products

2 unchanged sentences

Food, Beverage & Tobacco

Dade Paper and Bag Co Inc

Capital Goods

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Dade Paper and Bag Co Inc

Capital Goods

Distribution International Inc

3 unchanged sentences

Food, Beverage & Tobacco

Eagleclaw Midstream Ventures LLC

Eagle Family Foods Inc

Food, Beverage & Tobacco

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Electronics For Imaging Inc

Technology Hardware & Equipment

Empire Today LLC

Frontline Technologies Group LLC

Software & Services

Entertainment Benefits Group LLC

Media & Entertainment

Entertainment Benefits Group LLC

Media & Entertainment

Entertainment Benefits Group LLC

Media & Entertainment

Frontline Technologies Group LLC

2 unchanged sentences

Diversified Financials

Greystone Equity Member Corp

Diversified Financials

Greystone Equity Member Corp

Diversified Financials

Heniff Transportation Systems LLC

Transportation

Heniff Transportation Systems LLC

Transportation

Heniff Transportation Systems LLC

Transportation

Heniff Transportation Systems LLC

Transportation

HM Dunn Co Inc

1 unchanged sentence

L+875 PIK (L+875 Max PIK)

HM Dunn Co Inc

Capital Goods

15.0% PIK (15.0% Max PIK)

Hudson Technologies Co

3 unchanged sentences

Icynene Group Ltd

Commercial & Professional Services

Imagine Communications Corp

Media & Entertainment

Imagine Communications Corp

Industrial Group Intermediate Holdings LLC

Media & Entertainment

Industria Chimica Emiliana Srl

Pharmaceuticals, Biotechnology & Life Sciences

Industria Chimica Emiliana Srl

Pharmaceuticals, Biotechnology & Life Sciences

Industry City TI Lessor LP

1 unchanged sentence

10.8%, 1.0% PIK (1.0% Max PIK)

Integro Ltd/United States

JAKKS Pacific Inc

Consumer Durables & Apparel

JHC Acquisition LLC

Capital Goods

JHC Acquisition LLC

Capital Goods

JHT Holdings Inc

2 unchanged sentences

Consumer Services

JSS Holdings Ltd

Capital Goods

L+800, 0.0% PIK (2.5% Max PIK)

Kellermeyer Bergensons Services LLC

Commercial & Professional Services

Kellermeyer Bergensons Services LLC

Commercial & Professional Services

Kellermeyer Bergensons Services LLC

Commercial & Professional Services

Kodiak BP LLC

2 unchanged sentences

Capital Goods

Lazard Global Compounders Fund

Diversified Financials

Lazard Global Compounders Fund

Diversified Financials

Leading Edge Aviation Services Inc

Capital Goods

Leading Edge Aviation Services Inc

Capital Goods

Leading Edge Aviation Services Inc

Capital Goods

Koosharem LLC

Commercial & Professional Services

Technology Hardware & Equipment

Commercial & Professional Services

Lionbridge Technologies Inc

Consumer Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Lipari Foods LLC

Food & Staples Retailing

Lipari Foods LLC

Food & Staples Retailing

Lipari Foods LLC

Food & Staples Retailing

Matchesfashion Ltd

2 unchanged sentences

Capital Goods

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

L+725, 2.3% PIK (2.3% Max

MI Windows & Doors Inc

Capital Goods

Micronics Filtration Holdings Inc

1 unchanged sentence

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

Software & Services

Mitel US Holdings Inc

Technology Hardware & Equipment

Murray Energy Corp

National Debt Relief LLC

Diversified Financials

NaviHealth Inc.

Health Care Equipment & Services

Motion Recruitment Partners LLC

Commercial & Professional Services

Motion Recruitment Partners LLC

Commercial & Professional Services

Motion Recruitment Partners LLC

Commercial & Professional Services

Multi-Color Corp

Commercial & Professional Services

Consumer Durables & Apparel

Software & Services

Nine West Holdings

Consumer Durables & Apparel

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Nine West Holdings

Consumer Durables & Apparel

North Haven Cadence Buyer Inc

6 unchanged sentences

Consumer Services

North Haven Cadence Buyer Inc

Consumer Services

One Call Care Management Inc

Ontic Engineering & Manufacturing Inc

Capital Goods

Ontic Engineering & Manufacturing Inc

Capital Goods

Telecommunication Services

Pacific Union Financial LLC

Diversified Financials

PAE Holding Corp

Capital Goods

Patriot Well Solutions LLC

Petroplex Acidizing Inc

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

Peak 10 Holding Corp

Telecommunication Services

Petroplex Acidizing Inc

15.0% PIK (15.0% Max PIK)

PHRC License LLC

Consumer Services

L+850, 0.3% PIK (0.3% Max PIK)

L+725, 1.8% PIK (1.8% Max

Power Distribution Inc

Capital Goods

Project Marron

Consumer Services

Health Care Equipment & Services

Qdoba Restaurant Corp

Consumer Services

Quorum Health Corp

Health Care Equipment & Services

Reliant Rehab Hospital Cincinnati LLC

Health Care Equipment & Services

Revere Superior Holdings, Inc

Software & Services

Revere Superior Holdings, Inc

Software & Services

Revere Superior Holdings, Inc

Software & Services

Revere Superior Holdings, Inc

Software & Services

Roadrunner Intermediate Acquisition Co LLC

Health Care Equipment & Services

Rogue Wave Software Inc

Software & Services

RSC Insurance Brokerage Inc

Safariland LLC

Capital Goods

Safariland LLC

Capital Goods

L+650, 0.8% PIK (0.8% Max PIK)

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

L+700, 0.8% PIK (0.8% Max PIK)

Sequel Youth & Family Services LLC

4 unchanged sentences

Consumer Durables & Apparel

SIRVA Worldwide Inc

Commercial & Professional Services

Smart Foodservice

Food & Staples Retailing

SMART Global Holdings Inc

2 unchanged sentences

Telecommunication Services

SSC (Lux) Limited S.a r.l.

Health Care Equipment & Services

Staples Canada

5 unchanged sentences

Software & Services

Sutherland Global Services Inc

Software & Services

Sweet Harvest Foods Management Co

Food & Staples Retailing

L+775, 1.0% PIK (1.0% Max PIK)

Software & Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Software & Services

Team Health Inc

4 unchanged sentences

ThreeSixty Group

Total Safety US Inc

Capital Goods

Software & Services

Transaction Services Group Ltd

Consumer Services

Transaction Services Group Ltd

Consumer Services

Truck-Lite Co LLC

Automobiles & Components

Truck-Lite Co LLC

Automobiles & Components

Truck-Lite Co LLC

Automobiles & Components

Utility One Source LP

Capital Goods

Versatile Processing Group Inc

Vertiv Group Corp

Technology Hardware & Equipment

Virgin Pulse Inc

(e)(g)(h)(i)(k)

Software & Services

12 unchanged sentences

Transportation

Wheels Up Partners LLC

Transportation

Wheels Up Partners LLC

Transportation

WireCo WorldGroup Inc

Yak Access LLC

Capital Goods

Z Gallerie LLC

L+650, 2.0% PIK (2.0% Max PIK)

Zeta Interactive Holdings Corp

5 unchanged sentences

Net Senior Secured LoansFirst Lien

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Senior Secured LoansSecond Lien30.9%

9 unchanged sentences

Pharmaceuticals, Biotechnology & Life Sciences

Ammeraal Beltech Holding BV

Capital Goods

Amtek Global Technology Pte Ltd

Automobiles & Components

Amtek Global Technology Pte Ltd

Automobiles & Components

Arena Energy LP

L+900, 4.0% PIK (4.0% Max PIK)

Bellatrix Exploration Ltd

athenahealth Inc

Health Care Equipment & Services

Bellatrix Exploration Ltd

4 unchanged sentences

Chisholm Oil & Gas Operating LLC

L+550, 3.0% PIK (3.0% Max PIK)

CommerceHub Inc

Software & Services

CTI Foods Holding Co LLC

Food, Beverage & Tobacco

Culligan International Co

Household & Personal Products

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Direct ChassisLink Inc

Transportation

EaglePicher Technologies LLC

Capital Goods

Electronics For Imaging Inc

Technology Hardware & Equipment

Emerald Performance Materials LLC

1 unchanged sentence

Technology Hardware & Equipment

Grocery Outlet Inc

Food & Staples Retailing

Gruden Acquisition Inc

Transportation

Higginbotham Insurance Agency Inc

Integro Ltd/United States

iParadigms Holdings LLC

Software & Services

Jo-Ann Stores Inc

LBM Borrower LLC

4 unchanged sentences

Consumer Durables & Apparel

One Call Care Management Inc

L+375, 6.0% PIK (6.0% Max PIK)

NEP Broadcasting LLC

Media & Entertainment

OEConnection LLC

Software & Services

Ontic Engineering & Manufacturing Inc

Capital Goods

P2 Energy Solutions, Inc.

7 unchanged sentences

Polyconcept North America Inc

Consumer Durables & Apparel

Household & Personal Products

Pure Fishing Inc

4 unchanged sentences

Commercial & Professional Services

Consumer Services

Sorenson Communications LLC

Telecommunication Services

11.5% PIK (11.5% Max PIK)

Sparta Systems Inc

Software & Services

Spencer Gifts LLC

Sungard Availability Services Capital Inc

Software & Services

L+400, 2.5% PIK (2.5% Max PIK)

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Vestcom International Inc

2 unchanged sentences

Capital Goods

Wittur Holding GmbH

Capital Goods

E+850, 0.5% PIK (0.5% Max PIK)

Z Gallerie LLC

Total Senior Secured LoansSecond Lien

Unfunded Loan Commitments

Net Senior Secured LoansSecond Lien

Other Senior Secured Debt6.2%

Advanced Lighting Technologies Inc

L+700, 10.0% PIK (10.0% Max PIK)

L+1,700 PIK (L+1,700 Max PIK)

Angelica Corp

1 unchanged sentence

10.0% PIK (10.0% Max PIK)

Artesyn Embedded Technologies Inc

Technology Hardware & Equipment

Black Swan Energy Ltd

1 unchanged sentence

Capital Goods

Cornerstone Chemical Co

Direct ChassisLink Inc

Transportation

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Enterprise Development Authority

Consumer Services

FourPoint Energy LLC

Genesys Telecommunications Laboratories Inc

Technology Hardware & Equipment

JW Aluminum Co

Consumer Durables & Apparel

Maxim Crane Works LP / Maxim Finance Corp

1 unchanged sentence

Mood Media Corp

Media & Entertainment

L+1,400 PIK (L+1,400 Max PIK)

MultiPlan Inc

Health Care Equipment & Services

Pattonair Holdings Ltd

Capital Goods

RedPrairie Corp

Software & Services

Rockport (Relay)

1 unchanged sentence

15.0% PIK (15.0% Max PIK)

Sorenson Communications LLC

Telecommunication Services

9.0%, 0.0% PIK (9.0% Max PIK)

Sunnova Energy Corp

6.0%, 6.0% PIK (6.0% Max PIK)

Surgery Partners Holdings LLC

Health Care Equipment & Services

Capital Goods

Velvet Energy Ltd

1 unchanged sentence

Commercial & Professional Services

Z Gallerie LLC

Total Other Senior Secured Debt

7 unchanged sentences

10.0% PIK (10.0% Max PIK)

Aurora Diagnostics Holdings LLC / Aurora Diagnostics Financing Inc

athenahealth Inc

Health Care Equipment & Services

12.3%, 1.5% PIK (1.5% Max PIK)

L+1,125 PIK (L+1,125 Max PIK)

Byrider Finance LLC

3 unchanged sentences

Consumer Services

Craftworks Rest & Breweries Group Inc

Consumer Services

12.0% PIK (12.0% Max PIK)

DEI Sales Inc

1 unchanged sentence

13.0% PIK (13.0% Max PIK)

Diamond Resorts International Inc

Consumer Services

GFL Environmental Inc

Commercial & Professional Services

Hilding Anders

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

Consumer Durables & Apparel

12 unchanged sentences

18.0% PIK (18.0% Max PIK)

Home Partners of America Inc

Hub International Ltd

Imagine Communications Corp

Media & Entertainment

12.5% PIK (12.5% Max PIK)

Ken Garff Automotive LLC

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Kenan Advantage Group Inc

Transportation

Lazard Global Compounders Fund

Diversified Financials

LifePoint Hospitals Inc

Health Care Equipment & Services

Logans Roadhouse Inc

Consumer Services

Nouryon (fka Akzo Nobel Specialty Chemicals)

PAREXEL International Corp

Pharmaceuticals, Biotechnology & Life Sciences

Plastipak Holdings Inc

Ply Gem Holdings Inc

2 unchanged sentences

Health Care Equipment & Services

Sorenson Communications LLC

Telecommunication Services

13.9%, 0.0% PIK (13.9% Max PIK)

SRS Distribution Inc

Capital Goods

Sungard Availability Services Capital Inc

Software & Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Surgery Partners Holdings LLC

Health Care Equipment & Services

Team Health Inc

Health Care Equipment & Services

Versatile Processing Group Inc

13.0% PIK (13.0% Max PIK)

Vertiv Group Corp

2 unchanged sentences

Total Subordinated Debt

Unfunded Debt Commitments

Net Subordinated Debt

Portfolio Company (a)

Asset Based Finance19.1%

Accelerator Investments Aggregator LP

801 5th Ave, Seattle, Structure Mezzanine

8.0%, 0.0% PIK (3.0% Max PIK)

801 5th Ave, Seattle, Private Equity

Abacus JV, Private Equity

Accelerator Investments Aggregator LP, Private Equity

Diversified Financials

Altus Power America Inc, Preferred Stock

9.0%, 5.0% PIK

Altus Power America Inc, Preferred Stock

9.0%, 5.0% PIK

Altavair AirFinance, Private Equity

Capital Goods

AMPLIT JV LP, Limited Partnership Interest

Diversified Financials

Australis Maritime, Private Equity

Australis Maritime, Common Stock

Transportation

Bank of Ireland

Comet Aircraft S.a.r.l., Common Stock

Capital Goods

Bank of Ireland, Class B Credit Linked Floating Rate Note

Global Jet Capital LLC, Structured Mezzanine

36 unchanged sentences

Commercial & Professional Services

Home Partners JV, Structured Mezzanine

11.0% PIK (11.0% Max PIK)

Home Partners JV, Structured Mezzanine

11.0% PIK (11.0% Max PIK)

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Home Partners JV, Common Stock

Home Partners JV, Private Equity

(g)(l)(n)(x)(y)

KKR Central Park Leasing Aggregator L.P., Partnership Interest

Capital Goods

KKR Zeno Aggregator LP (K2 Aviation)

KKR Zeno Aggregator LP (K2 Aviation), Partnership Interest

Capital Goods

LSF IX Java Investments Ltd, Term Loan

Diversified Financials

Montgomery Credit Holdings LP, Membership Interest

Diversified Financials

MP4 2013-2A Class Subord.

Diversified Financials

NewStar Clarendon 2014-1A Class D

Diversified Financials

NewStar Clarendon 2014-1A Class Subord.

Diversified Financials

Lenovo Group Ltd, Structured Mezzanine

Technology Hardware & Equipment

Lenovo Group Ltd, Structured Mezzanine

Technology Hardware & Equipment

Orchard Marine Limited, Class B Common Stock

2 unchanged sentences

Transportation

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Rampart CLO 2007 1A Class Subord.

Diversified Financials

Star Mountain SMB Multi-Manager Credit Platform LP, Limited Partnership Interest

Sofi Lending Corp, 2019-C R1

Diversified Financials

Toorak Capital LLC, Membership Interest

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

Diversified Financials

Toorak Capital Funding LLC, Membership Interest

Diversified Financials

Toorak Capital LLC, Membership Interest

4 unchanged sentences

Total Asset Based Finance

Unfunded Asset Based Finance Commitments

Net Asset Based Finance

Strategic Credit Opportunities, LLC12.4%

2 unchanged sentences

Total Strategic Credit Opportunities Partners

Equity/Other12.9% (k)

5 Arch Income Fund 2, LLC, Common Stock

Diversified Financials

Portfolio Company (a)

Equity/Other14.8% (m)

Advanced Lighting Technologies Inc, Common Stock

5 unchanged sentences

AltEn, LLC, Membership Units

Altus Power America Inc, Common Stock

Amtek Global Technology Pte Ltd, Ordinary Shares

8 unchanged sentences

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

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Ascent Resources Utica Holdings LLC / ARU Finance Corp, Trade Claim

1 unchanged sentence

Software & Services

ASG Technologies, Warrants

ASG Technologies, Warrant

Software & Services

1 unchanged sentence

Software & Services

Aurora Diagnostics Holdings LLC / Aurora Diagnostics Financing Inc, Warrant

Health Care Equipment & Services

Aspect Software Inc, Warrant

Software & Services

Belk Inc, Units

Brock Group LLC, Common Stock

Bellatrix Exploration Ltd, Warrant

Byrider Finance LLC, Common Stock

Automobiles & Components

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Cengage Learning, Inc, Common Stock

Media & Entertainment

Charlotte Russe Inc, Common Stock

2 unchanged sentences

Capital Goods

CTI Foods Holding Co LLC, Common Stock

Food, Beverage & Tobacco

DEI Sales Inc, Class A Units

4 unchanged sentences

Consumer Durables & Apparel

Eastman Kodak Co, Common Stock

Directed LLC, Warrant

Consumer Durables & Apparel

4 unchanged sentences

FourPoint Energy LLC, Common Stock, Class EIII Units

Fronton BV, Common Stock

Consumer Services

Genesys Telecommunications Laboratories Inc, Class A Shares

8 unchanged sentences

Technology Hardware & Equipment

Harvest Oil & Gas Corp, Common Stock

Harvey Industries Inc, Common Stock

6 unchanged sentences

Consumer Durables & Apparel

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

Hilding Anders, Class B Common Stock

11 unchanged sentences

Imagine Communications Corp, Common Stock

Industrial Group Intermediate Holdings LLC, Common Stock

Media & Entertainment

JHC Acquisition LLC, Common Stock

10 unchanged sentences

Diversified Financials

Leading Edge Aviation Services Inc, Common Stock

Capital Goods

Leading Edge Aviation Services Inc, Preferred Stock

MB Precision Holdings LLC, Preferred Stock

Capital Goods

1 unchanged sentence

Capital Goods

MB Precision Holdings LLC, Preferred Stock

Capital Goods

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Micronics Filtration Holdings Inc, Common Stock

5 unchanged sentences

Mood Media Corp, Common Stock

Media & Entertainment

NBG Home, Common Stock

2 unchanged sentences

Consumer Durables & Apparel

North Haven Cadence Buyer Inc, Common Equity

North Haven Cadence Buyer Inc, Common Stock

Consumer Services

One Call Care Management Inc, Common Stock

4,370,566,806

One Call Care Management Inc, Preferred Stock A

One Call Care Management Inc, Preferred Stock B

9.0% PIK (9.0% Max PIK)

Petroplex Acidizing Inc, Preferred Stock A

2.0%, 0.0% PIK (2.0% Max PIK)

Petroplex Acidizing Inc, Warrant

Polyconcept North America Inc, Class A1 Units

Consumer Durables & Apparel

Household & Personal Products

Power Distribution Inc, Common Stock

3 unchanged sentences

Ridgeback Resources Inc, Common Stock

Rockport (Relay), Class A Units

Rockport (Relay), Warrant

Consumer Durables & Apparel

1 unchanged sentence

Capital Goods

Safariland LLC, Warrant

Capital Goods

Sequential Brands Group Inc., Common Stock

2 unchanged sentences

Telecommunication Services

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company (a)

SSC (Lux) Limited S.a r.l., Common Stock

2 unchanged sentences

Consumer Durables & Apparel

Sunnova Energy Corp, Common Stock

Sunnova Energy Corp, Preferred Stock

Sungard Availability Services Capital Inc, Common Stock

Software & Services

Sunnova Energy International Inc, Common Stock

ThermaSys Corp, Common Stock

(e)(f)(g)(n)(y)

Capital Goods

1 unchanged sentence

Capital Goods

Towergate, Preferred Stock

Towergate, Ordinary Shares

Towergate, Preferred Stock

Trace3 Inc, Common Stock

2 unchanged sentences

Warren Resources Inc, Common Stock

Z Gallerie LLC, Common Stock

Zeta Interactive Holdings Corp, Preferred Stock, Series E1

6 unchanged sentences

TOTAL INVESTMENTS190.3%

LIABILITIES IN EXCESS OF OTHER ASSETS(77.3%)

LIABILITIES IN EXCESS OF OTHER

ASSETS(90.3%)

NET ASSETS100%

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Foreign currency forward contracts

1 unchanged sentence

Settlement Date

December 31, 2018

Unrealized Appreciation

7 unchanged sentences

JP Morgan Chase Bank

Cross currency swaps

Company Receives Fixed Rate

Company Pays Fixed Rate

Termination Date

Unrealized Appreciation

(Depreciation)

JP Morgan Chase Bank

2.20% on USD notional amount of $188.1

0.00% on EUR notional amount of 177.5

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

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Certain variable rate securities in the Companys portfolio bear interest at a rate determined by a publicly disclosed base rate plus a

14 unchanged sentences

(see Note 9).

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Security or portion thereof was held within CCT New York Funding LLC and was pledged as collateral supporting the amounts outstanding under

the revolving credit facility with JPMorgan Chase Bank (see Note 9).

Security or portion thereof held within FS KKR MM CLO 1 LLC (see Note 9).

Security or portion thereof was held within CCT Tokyo Funding LLC and was pledged as collateral supporting the amounts outstanding under the

15 unchanged sentences

Security held within CCT Holdings II, LLC, a wholly-owned subsidiary of the Company.

Security held within FCF, LLC, a wholly-owned subsidiary of the Company.

Security is an unfunded commitment.

20 unchanged sentences

Senior Secured LoansFirst Lien

Advanced Lighting Technologies Inc

Aspect Software Inc (4)

Aspect Software Inc

Charlotte Russe Inc

HM Dunn Co Inc

Logans Roadhouse, Inc.

HM Dunn Co Inc

MB Precision Holdings LLC

One Call Care Management Inc

Petroplex Acidizing Inc

Safariland LLC (6)

ThermaSys Corp

Senior Secured LoansSecond Lien

Logans Roadhouse, Inc.

Z Gallerie LLC

Other Senior Secured Debt

Advanced Lighting Technologies Inc

JW Aluminum Co (5)

Mood Media Corp

Rockport (Relay) (4)

Z Gallerie LLC

Asset Based Finance

Home Partners JV, Structured Mezzanine

Home Partners JV, Common Stock

Home Partners JV, Private Equity

Orchard Marine Limited, Class B Common Stock

Orchard Marine Limited, Series A Preferred Stock

Advanced Lighting Technologies Inc, Common Stock

Advanced Lighting Technologies Inc, Warrant

AltEn, LLC, Membership Units

3 unchanged sentences

Charlotte Russe Inc, Common Stock

Fronton Investor Holdings, LLC, Class B Units

HM Dunn Co Inc, Preferred Stock, Series A

HM Dunn Co Inc, Preferred Stock, Series B

Home Partners of America Inc, Common Stock

Home Partners of America Inc, Warrant

Fronton BV, Common Stock

notes to consolidated financial statements.

10 unchanged sentences

Fair Value at

MB Precision Holdings LLC, Class A2

HM Dunn Co Inc, Preferred Stock, Series A

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 (5)

JW Aluminum Co, Preferred Stock (5)

MB Precision Holdings LLC, Class A2 Units

MB Precision Holdings LLC, Preferred Stock

Mood Media Corp, Common Stock

One Call Care Management Inc, Common Stock

One Call Care Management Inc, Preferred Stock A

One Call Care Management Inc, Preferred Stock B

Petroplex Acidizing Inc, Preferred Stock A

Petroplex Acidizing Inc, Warrant

Proserv Acquisition LLC, Class A Common Units

Proserv Acquisition LLC, Class A Preferred Units

Roadhouse Holding Inc., Common Equity

Rockport (Relay), Class A Units

Rockport (Relay), Class A

Safariland LLC, Common Equity (6)

ThermaSys Corp, Common Stock

ThermaSys Corp, Preferred Stock

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

6 unchanged sentences

Transfers in or out have been presented at amortized cost.

The Company held this investment as of December 31, 2018 but it was deemed to control the portfolio company as of

December 31, 2018.

Transfers in or out have been presented at amortized cost.

The Company held this investment as of December 31, 2018 but it was not deemed to be an affiliated person of the portfolio

company or deemed to control the portfolio company as of December 31, 2018.

Transfers in or out have been presented at amortized cost.

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(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

10 unchanged sentences

Reductions (2)

Net Change in

(Depreciation)

5 unchanged sentences

Amtek Global Technology Pte Ltd

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2018

(in millions, except share amounts)

Portfolio Company

Fair Value at

Additions (1)

Reductions (2)

Net Change in

(Depreciation)

Fair Value at

Amtek Global Technology Pte Ltd

Other Senior Secured Debt

7 unchanged sentences

Asset Based Finance

801 5th Ave, Seattle, Structure Mezzanine

801 5th Ave, Seattle, Private Equity

Comet Aircraft S.a.r.l., Common Stock

13 unchanged sentences

JW Aluminum Co, Common Stock (4)

notes to consolidated financial statements.

FS KKR Capital Corp.

Consolidated Schedule of Investments (continued)

As of December 31, 2019

(in millions, except share amounts)

Portfolio Company

Fair Value at

Additions (1)

Reductions (2)

(Depreciation)

Fair Value at

JW Aluminum Co, Preferred Stock (4)

24 unchanged sentences

the Companys accounts and the accounts of its wholly-owned subsidiaries as of December 31, 2020.

All significant intercompany transactions have been eliminated in consolidation.

Certain of the Companys consolidated subsidiaries are

subject to U.S.

All intercompany transactions have been eliminated in consolidation.

Certain of the Companys consolidated subsidiaries are subject to

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 December 19, 2018,

the Company completed its acquisition, or the Merger, of Corporate Capital Trust, Inc., or CCT, pursuant to that certain Agreement and Plan of Merger, or the Merger Agreement, dated as of July 22, 2018, by and among the Company, CCT, IC

Acquisition, Inc., a former wholly-owned subsidiary of the Company, or Merger Sub, and the Advisor.

Summary of Significant

Accounting Policies

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 December 19, 2018, the Company completed its

acquisition, or the 2018 Merger, of Corporate Capital Trust, Inc., or CCT, pursuant to that certain Agreement and Plan of Merger, or the 2018 Merger Agreement, dated as of July 22, 2018, by and among the Company, CCT, IC Acquisition, Inc., a

former wholly-owned subsidiary of the Company, or Merger Sub, and the Advisor.

See Note 13 for a discussion of the 2018 Merger.

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.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Principal Business and

Organization (continued)

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:

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

Weighted average number of shares of common stock outstanding (as adjusted)

Net investment income per share (as previously reported)

Net investment income per share (as adjusted)

Earnings per share (as previously reported)

Earnings per share (as adjusted)

On November 23, 2020, the Company entered into an Agreement and Plan of Merger, or the 2020 Merger

Agreement, with FS KKR Capital Corp II., a Maryland corporation, or FSKR and, together with the Company, the Funds, Rocky Merger Sub, Inc., a Maryland corporation and wholly-owned subsidiary of the Company, or Merger Sub, and the Advisor.

Merger Agreement provides that, subject to the conditions set forth in the 2020 Merger Agreement, Merger Sub will merge with and into FSKR, with FSKR continuing as the surviving company and as a wholly-owned subsidiary of the Company, or the First

Merger, and, immediately thereafter, FSKR will merge with and into the Company, with the Company continuing as the surviving company or, together with the First Merger, the 2021 Merger.

See Note 14 for additional information.

Summary of Significant Accounting Policies

Basis of Presentation:

The accompanying audited consolidated financial statements of the

Company have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP.

The Company is considered an investment company under GAAP and follows the accounting and reporting guidance applicable

to investment companies under Financial Accounting Standards Board, or the FASB, Accounting Standards Codification Topic 946, Financial ServicesInvestment Companies .

The Company has evaluated the impact of subsequent events through the

date the consolidated financial statements were issued and filed with the U.S.

Securities and Exchange Commission, or the SEC.

The accompanying audited consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States

of America, or GAAP.

The Company is considered an investment company under GAAP and follows the accounting and reporting guidance applicable to investment companies under Financial Accounting Standards Board, or the FASB, Accounting Standards

Codification Topic 946, Financial ServicesInvestment Companies .

The Company has evaluated the impact of subsequent events through the date the consolidated financial statements were issued and filed with the U.S.

Securities and Exchange

Commission, or the SEC.

Use of Estimates:

The preparation of the consolidated financial statements in conformity with GAAP requires management to make

estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting

The preparation of the consolidated financial statements in conformity with

GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues

and expenses during the reporting period.

Actual results could differ from those estimates.

Cash and Cash Equivalents:

The Company considers all highly

liquid investments with original maturities of three months or less to be cash equivalents.

All cash balances are maintained with high credit quality financial institutions, which are members of the Federal Deposit Insurance Corporation.

The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

All cash balances are maintained with high credit quality financial institutions, which are members of the Federal Deposit

Insurance Corporation.

Valuation of Portfolio Investments:

The Company determines the net asset value of its investment portfolio each quarter.

are valued at fair value as determined in good faith by the Companys board of directors.

In connection with that

The Company determines the net asset value of its investment

portfolio each quarter.

Securities are valued at fair value as determined in good faith by the Companys board of directors.

In connection with that determination, the Advisor provides the Companys board of directors with portfolio

company valuations which are based on relevant inputs, including, but not limited to, indicative dealer quotes, values of like securities, recent portfolio company financial statements and forecasts, and valuations prepared by independent

third-party valuation services.

Accounting Standards Codification Topic 820, Fair Value Measurements and Disclosure , or

ASC Topic 820, issued by the FASB clarifies the definition of fair value and requires companies to expand their disclosure about the use of fair value to measure assets and liabilities in interim and annual periods subsequent to initial recognition.

ASC Topic 820 defines fair value as

FS KKR Capital Corp.

3 unchanged sentences

Policies (continued)

determination, the Advisor provides the Companys board of directors with portfolio company valuations which are based on relevant inputs, including, but not limited to, indicative dealer

quotes, values of like securities, recent portfolio company financial statements and forecasts, and valuations prepared by independent third-party valuation services.

Accounting Standards Codification Topic 820, Fair Value Measurements and Disclosure , or ASC Topic 820, issued by the FASB clarifies the definition of fair value and requires companies to expand

their disclosure about the use of fair value to measure assets and liabilities in interim and annual periods subsequent to initial recognition.

ASC Topic 820 defines fair value as the price that would be received from the sale of an asset or paid to

transfer a liability in an orderly transaction between market participants at the measurement date.

ASC Topic 820 also establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.

the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

ASC Topic 820 also

establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value.

These tiers include:

Level 1, defined as observable inputs such as quoted prices in active markets;

Level 2, which includes inputs such as quoted prices for similar securities in active markets and quoted prices for identical securities where there is little

or no activity in the market;

and Level 3, defined as unobservable inputs for which little or no market data exists, therefore requiring an entity to develop its own assumptions.

With respect to investments for which market quotations are not readily available, the Company undertakes a multi-step valuation process

each quarter, as described below:

Level 2, which includes inputs

such as quoted prices for similar securities in active markets and quoted prices for identical securities where there is little or no activity in the market;

and Level 3, defined as unobservable inputs for which little or no market data exists,

therefore requiring an entity to develop its own assumptions.

With respect to investments for which market quotations are not

readily available, the Company undertakes a multi-step valuation process each quarter, as described below:

the Companys quarterly fair valuation process begins by the Advisor providing financial and operating information with respect to each portfolio

20 unchanged sentences

Below is a description of factors that the Advisor, any approved independent third-party valuation services and the Companys board of directors may consider when determining the fair value of the Companys

Valuation of fixed income investments, such as loans and debt securities, depends upon a number of factors,

including prevailing interest rates for like securities, expected volatility in future interest rates, call features, put features and other relevant terms of the debt.

For investments without readily available market prices, the Company may

incorporate these factors into discounted cash flow models to arrive at fair value.

Other factors that may be considered include the borrowers ability to adequately service its debt, the fair market value of the borrower in relation to the

face amount of its outstanding debt and the quality of collateral securing the Companys debt investments.

FS KKR Capital Corp.

3 unchanged sentences

Policies (continued)

Valuation of fixed income investments, such as loans and debt securities, depends upon a

number of factors, including prevailing interest rates for like securities, expected volatility in future interest rates, call features, put features and other relevant terms of the debt.

For investments without readily available market prices, the

Company may incorporate these factors into discounted cash flow models to arrive at fair value.

Other factors that may be considered include the borrowers ability to adequately service its debt, the fair market value of the borrower in

relation to the face amount of its outstanding debt and the quality of collateral securing the Companys debt investments.

For convertible debt securities, fair value generally approximates the fair value of the debt plus the fair value of an option to purchase

the underlying security (i.e., the security into which the debt may convert) at the conversion price.

For convertible debt securities, fair value generally approximates the fair value of the

debt plus the fair value of an option to purchase the underlying security (i.e., the security into which the debt may convert) at the conversion price.

To value such an option, a standard option pricing model may be used.

The Companys equity interests in portfolio companies for which there is no liquid public market are valued at fair value.

The Companys board of directors, in its determination of fair value,

may consider various factors, such as 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.

All of these factors may be

subject to adjustments based upon the particular circumstances of a portfolio company or the Companys actual investment position.

For example, adjustments to EBITDA may take into account compensation to previous owners or acquisition,

recapitalization, restructuring or other related items.

The Advisor, any approved independent third-party valuation services

and the Companys board of directors may also consider private merger and acquisition statistics, public trading multiples discounted for illiquidity and other factors, valuations implied by third-party investments in the portfolio companies or

industry practices in determining fair value.

The Advisor, any approved independent third-party valuation services and the Companys board of directors may also consider the size and scope of a portfolio company and its specific strengths and

weaknesses, and may apply discounts or premiums, where and as appropriate, due to the higher (or lower) financial risk and/or the smaller size of portfolio companies relative to comparable firms, as well as such other factors as the Companys

board of directors, in consultation with the Advisor and any approved independent third-party valuation services, if applicable, may consider relevant in assessing fair value.

Generally, the value of the Companys equity interests in public

companies for which market quotations are readily available is based upon the most recent closing public market price.

Portfolio securities that carry certain restrictions on sale are typically valued at a discount from the public market value of

the security.

When the Company receives warrants or other equity securities at nominal or no additional cost in connection

with an investment in a debt security, the cost basis in the investment will be allocated between the debt securities and any such warrants or other equity securities received at the time of origination.

The Companys board of directors

subsequently values these warrants or other equity securities received at their fair value.

The fair values of the

Companys investments are determined in good faith by the Companys board of directors.

The Companys board of directors is responsible for the valuation of the Companys portfolio investments at fair value as determined in good

faith pursuant to the Companys valuation policy and consistently applied valuation process.

The Companys board of directors has delegated day-to-day

responsibility for implementing its valuation policy to the Advisor, and has authorized the Advisor to utilize independent third-party valuation and pricing services that have been approved by the Companys board of directors.

The valuation

committee is responsible for overseeing the Advisors implementation of the valuation process.

Companys board of directors, in its determination of fair value, may consider various factors, such as 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.

All of these factors may be subject to adjustments based upon the particular circumstances of a portfolio company or the Companys actual investment position.

For example, adjustments to EBITDA may

take into account compensation to previous owners or acquisition, recapitalization, restructuring or other related items.

Advisor, any approved independent third-party valuation services and the Companys board of directors may also consider private merger and acquisition statistics, public trading multiples discounted for illiquidity and other factors, valuations

implied by third-party investments in the portfolio companies or industry practices in determining fair value.

The Advisor, any approved independent third-party valuation services and the Companys board of directors may also consider the size

and scope of a portfolio company and its specific strengths and weaknesses, and may apply discounts or premiums, where and as appropriate, due to the higher (or lower) financial risk and/or the smaller size of portfolio companies relative to

comparable firms, as well as such other factors as the Companys board of directors, in consultation with the Advisor and any approved independent third-party valuation services, if applicable, may consider relevant in assessing fair value.

Generally, the value of the Companys equity interests in public companies for which market quotations are readily available is based upon the most recent closing public market price.

Portfolio securities that carry certain restrictions on sale

are typically valued at a discount from the public market value of the security.

When the Company receives warrants or other

equity securities at nominal or no additional cost in connection with an investment in a debt security, the cost basis in the investment will be allocated between the debt securities and any such warrants or other equity securities received at the

time of origination.

The Companys board of directors subsequently values these warrants or other equity securities received at their fair value.

The Company values certain investments at their net asset value in accordance with practical expedient under ASC Topic 820.

The fair values of the Companys investments are determined in good faith by the Companys board of directors.

The Companys board of directors is responsible for the valuation of the

Companys portfolio investments at fair value as determined in good faith pursuant to the Companys valuation policy and consistently applied valuation process.

The Companys board of directors has delegated day-to-day responsibility for implementing its valuation policy to the Advisor, and has authorized the Advisor to utilize independent third-party valuation and pricing

services that have been approved by the Companys board of directors.

The valuation committee is responsible for overseeing the Advisors implementation of the valuation process.

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.

The Company 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.

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

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.

If 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 investments may be recognized as

income or applied to principal depending upon the collectability of the remaining principal and interest.

Non-accrual investments may be restored to accrual status when principal and interest become current

and are likely to remain current based on the Companys judgment.

FS KKR Capital Corp.

3 unchanged sentences

Policies (continued)

relevant to the investment.

If there is reasonable doubt that the Company will receive any previously accrued interest, then the accrued interest will be

Payments received on non-accrual investments may be recognized as income or applied to principal depending upon the collectability of the remaining

principal and interest.

Non-accrual investments may be restored to accrual status when principal and interest become current and are likely to remain current based on the Companys judgment.

Loan origination fees, original issue discount and market discount are capitalized and the Company amortizes such amounts as interest

income over the respective term of the loan or security.

Loan origination fees, original issue discount and market discount are capitalized and

the Company amortizes such amounts as interest income over the respective term of the loan or security.

Upon the prepayment of a loan or security, any unamortized loan origination fees and original issue discount are recorded as interest income.

1 unchanged sentence

The Company records prepayment premiums on loans and securities as fee income when it receives such amounts.

Effective January 1, 2018, the Company adopted ASC Topic 606, Revenue from Contracts with Customers , or ASC Topic 606, using

the cumulative effect method applied to in-scope contracts with customers that have not been completed as of the date of adoption.

The Company did not identify any

in-scope contracts that had not been completed as of the date of adoption and, as a result, the Company did not recognize a cumulative effect on stockholders equity in connection with the adoption of the

new revenue recognition guidance.

For the year ended December 31, 2019, the Company recognized $20 in structuring fee

revenue under the new revenue recognition guidance and included such revenue in the fee income line item on its consolidated statement of operations.

Comparative periods are presented in accordance with revenue recognition guidance effective prior

to January 1, 2018, under which the Company recorded structuring and other non-recurring upfront fees as income when earned.

The Company has determined that the adoption of the new revenue recognition

guidance did not have a material impact on the amount of revenue recognized for the year ended December 31, 2019.

Realized Gains or Losses, Net Change in Unrealized Appreciation or Depreciation and Net Change in Unrealized Gains or Losses on Foreign Currency:

Gains or losses on the sale of investments are calculated by using the specific identification

The Company measures realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, without regard to unrealized appreciation or depreciation previously

recognized, but considering unamortized fees.

Net change in unrealized appreciation or depreciation reflects the change in portfolio investment values during the reporting period, including any reversal of previously recorded unrealized gains or

losses when gains or losses are realized.

For the years ended December 31, 2020 and 2019, the Company recognized $16 and $20, respectively, in structuring fee revenue and

included such revenue in the fee income line item on its consolidated statement of operations.

Net Realized Gains or

Losses, Net Change in Unrealized Appreciation or Depreciation and Net Change in Unrealized Gains or Losses on Foreign Currency:

Gains or losses on the sale of investments are calculated by using the specific identification method.

measures realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, without regard to unrealized appreciation or depreciation previously recognized, but considering

unamortized fees.

Net change in unrealized appreciation or depreciation reflects the change in portfolio investment values during the reporting period, including any reversal of previously recorded unrealized gains or losses when gains or losses are

Net change in unrealized gains or losses on foreign currency reflects the change in the value of receivables or accruals during the reporting period due to the impact of foreign currency fluctuations.

Capital Gains Incentive Fee:

Pursuant to the terms of the investment advisory agreement, the incentive fee on capital

gains is determined and payable in arrears as of the end of each calendar year (or upon termination of the investment advisory agreement).

This fee equals 20.0% of the Companys incentive fee capital gains, which shall equal both CCTs and

the Companys realized capital gains (without duplication) on a cumulative basis from inception, calculated as of the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation (without

duplication) on a cumulative basis, less the aggregate amount of any capital gain incentive fees previously paid by CCT and the Company.

On a quarterly basis, the Company accrues for the capital gains incentive fee by calculating such fee as if it

were due and payable as of the end of such period.

The Company includes unrealized gains in the calculation of the capital

gains incentive fee expense and related accrued capital gains incentive fee.

This accrual reflects the incentive fees that would be payable to the Advisor if the Companys entire portfolio was liquidated at its fair value as of the balance

sheet date even though the Advisor is not entitled to an incentive fee with respect to unrealized gains unless and until such gains are actually realized.

Pursuant to the terms of the investment advisory agreement, the incentive fee on capital gains is

determined and payable in arrears as of the end of each calendar year (or upon termination of the investment advisory agreement).

This fee equals 20.0% of the Companys incentive fee capital gains, which shall equal both CCTs and the

Companys realized capital gains (without duplication) on a cumulative basis from inception, calculated as of the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation (without duplication)

on a cumulative basis, less the aggregate amount of any capital gain incentive fees previously paid by CCT and the Company.

On a quarterly basis, the Company accrues for the capital gains incentive fee by calculating such fee as if it were due and

payable as of the end of such period.

The Company includes unrealized gains in the calculation of the capital gains incentive

fee expense and related accrued capital gains incentive fee.

This accrual reflects the incentive fees that would be payable to the Advisor if the Companys entire portfolio was liquidated at its fair value as of the balance sheet date even

though the Advisor is not entitled to an incentive fee with respect to unrealized gains unless and until such gains are actually realized.

Subordinated Income Incentive Fee:

1 unchanged sentence

subordinated incentive fee on income under the investment advisory agreement, which is calculated and payable quarterly in arrears, equals 20.0% of the Companys pre-incentive fee net

investment income for the immediately preceding quarter and is subject to a hurdle rate, expressed as a rate of return on the

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Summary of Significant Accounting

Policies (continued)

value of the Companys net assets, equal to 1.75% per quarter, or an annualized hurdle rate of 7.0%.

As a result, the Advisor will not earn this incentive fee for any quarter until

the Companys pre-incentive fee net investment income for such quarter exceeds the hurdle rate of 1.75%.

Companys pre-incentive fee net investment income in any quarter exceeds the hurdle rate, the Advisor will be entitled to

investment income for the immediately preceding quarter and is subject to a hurdle rate, expressed as a rate of return on the value of the Companys net assets, equal to 1.75% per quarter, or an annualized hurdle rate of

As a result, the Advisor will not earn this incentive fee for any quarter until the Companys pre-incentive fee net investment income for such quarter exceeds the hurdle rate of

Once the Companys pre-incentive fee net investment income in any quarter exceeds the hurdle rate, the Advisor will be entitled to

a catch-up fee equal to the amount of the pre-incentive fee net investment income in excess of the hurdle rate, until the Companys pre-incentive fee net investment income for such quarter equals 2.1875%, or 8.75% annually, of net assets.

6 unchanged sentences

agreement take into account the historic per share pre-incentive fee return of both the Company and CCT, together with the historic per share incentive fees paid by both the Company and CCT.

purpose of calculating the per share pre-incentive fee return, any unrealized appreciation or depreciation recognized as a result of the purchase accounting for the Merger is excluded.

purpose of calculating the per share pre-incentive fee return, any unrealized appreciation or depreciation recognized as a result of the purchase accounting for the 2018 Merger is

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Summary of Significant Accounting

Policies (continued)

Income Taxes:

The Company has elected to be treated for U.S.

federal income tax purposes, and intends to qualify

annually, as a RIC under Subchapter M of the Code.

To qualify for and maintain qualification as a RIC, the Company must, among other things, meet certain

source-of-income and asset diversification requirements, as well as distribute to its stockholders, for each tax year, at least 90% of its investment company

taxable income, which is generally the Companys net ordinary income plus the excess, if any, of realized net short-term capital gains over realized net long-term capital losses, determined without regard to any deduction for

distributions paid.

As a RIC, the Company will not have to pay corporate-level U.S.

federal income tax

purposes, and intends to qualify annually, as a RIC under Subchapter M of the Code.

To qualify for and maintain qualification as a RIC, the Company must, among other things, meet certain source-of-income and asset diversification requirements, as well as distribute to its stockholders, for each tax year, at least 90% of its investment company taxable income, which is generally the

Companys net ordinary income plus the excess, if any, of realized net short-term capital gains over realized net long-term capital losses, determined without regard to any deduction for distributions paid.

As a RIC, the Company will not have

to pay corporate-level U.S.

federal income taxes on any income that it distributes to its stockholders.

The Company intends to make distributions in an amount sufficient to qualify for and

maintain its RIC tax status each tax year and to not pay any U.S.

The Company intends to make distributions in an amount sufficient to qualify for and maintain its RIC tax status each tax year and to not pay any

federal income taxes on income so distributed.

The Company is also subject to nondeductible federal excise taxes if it does not distribute in respect of each calendar year an amount

at least equal to the sum of 98% of net ordinary income, 98.2% of any capital gain net income, if any, and any recognized and undistributed income from prior years for which it paid no U.S.

The Company is also subject to nondeductible federal excise taxes if it does not distribute in respect of each calendar year an amount at least equal to the sum of 98% of net ordinary income, 98.2%

of any capital gain net income, if any, and any recognized and undistributed income from prior years for which it paid no U.S.

federal income taxes.

The Company accrued $7, $7 and $5 in

estimated excise taxes payable in respect of income received during the years ended December 31, 2019, 2018 and 2017, respectively.

During the years ended December 31, 2019, 2018, and 2017, the Company paid $9, $6 and $6, respectively, in

excise and other taxes.

The Company evaluates its tax positions to determine if the tax positions taken meet the minimum

recognition threshold in connection with accounting for uncertainties in income tax positions taken or expected to be taken for the purposes of measuring and recognizing tax benefits or liabilities in the Companys consolidated financial

Recognition of a tax benefit or liability with respect to an uncertain tax position is required only when the position is more likely than not to be sustained assuming examination by taxing authorities.

The Company recognizes

interest and penalties, if any, related to unrecognized tax liabilities as income tax expense in its consolidated statements of operations.

During the years ended December 31, 2019, 2018 and 2017, the Company did not incur any interest or

The Company has analyzed the tax positions taken on federal and state income tax returns for all open tax years,

and has concluded that no provision for income tax for uncertain tax positions is required in the Companys financial statements.

The Companys federal and state income and federal excise tax returns for tax years for which the applicable

statutes of limitations have not expired are subject to examination by the Internal Revenue Service and state departments of revenue.

The Company accrued $10, $7 and $7 in estimated excise taxes payable in respect of income received

during the years ended December 31, 2020, 2019 and 2018, respectively.

During the years ended December 31, 2020, 2019, and 2018, the Company paid $7, $9 and $6, respectively, in excise and other taxes.

The Company evaluates its tax positions to determine if the tax positions taken meet the minimum recognition threshold in connection with

accounting for uncertainties in income tax positions taken or expected to be taken for the purposes of measuring and recognizing tax benefits or liabilities in the Companys consolidated financial statements.

Recognition of a tax benefit or

liability with respect to an uncertain tax position is required only when the position is more likely than not to be sustained assuming examination by taxing authorities.

The Company recognizes interest and penalties, if any, related to

unrecognized tax liabilities as income tax expense in its consolidated statements of operations.

During the years ended December 31, 2020, 2019 and 2018, the Company did not incur any interest or penalties.

The Company has analyzed the tax positions taken on federal and state income tax returns for all open tax years, and has concluded that no

provision for income tax for uncertain tax positions is required in the Companys financial statements.

The Companys federal and state income and federal excise tax returns for tax years for which the applicable statutes of limitations

have not expired are subject to examination by the Internal Revenue Service and state departments of revenue.

Distributions:

Distributions to the Companys stockholders are recorded as of the record date.

Subject to the discretion of the Companys board of directors and applicable legal

restrictions, the Company intends to declare and pay such distributions on a quarterly basis.

Subject to the discretion of

the Companys board of directors and applicable legal restrictions, the Company intends to declare and pay such distributions on a quarterly basis.

Net realized capital gains, if any, are distributed or deemed distributed at least annually.

Reclassifications:

Certain amounts in the consolidated financial statements as of and for the years ended December 31, 2018

and 2017 have been reclassified to conform to the classifications used to prepare the consolidated financial statements for the year ended December 31, 2019.

Certain amounts in the consolidated financial statements as of and for the years ended

December 31, 2019 and 2018 have been reclassified to conform to the classifications used to prepare the consolidated financial statements for the year ended December 31, 2020.

Recent Accounting Pronouncements:

In August 2018, the FASB issued Accounting Standards Update

2018-13, Fair Value MeasurementDisclosures FrameworkChanges to Disclosure Requirements of Fair Value Measurement (Topic 820), or ASU 2018-13.

ASU 2018-13 introduces new fair value disclosure requirements and eliminates and modifies certain existing fair value disclosure requirements.

ASU 2018-13 is effective for fiscal

years, and interim periods within those fiscal years, beginning after December 15, 2019.

The Company implemented ASU 2018-13 during the year ended December 31, 2020, and it did not have a significant

impact on the Companys disclosure over fair value.

In March 2020, the FASB issued ASU

2020-04, Reference Rate Reform (Topic 848) , which provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships, and other transactions affected

by reference rate reform if certain criteria are met.

The amendments apply only to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform.

ASU 2020-04 is effective for all entities as of March 12, 2020 through December 31, 2022.

The expedients and exceptions provided by the amendments do not apply to contract modifications and hedging

relationships entered into or evaluated after December 31, 2022, except for hedging transactions as of December 31, 2022, that an entity has elected certain optional expedients for and that are retained through the end of the hedging

relationship.

The Company is currently evaluating the impact of adopting ASU 2020-04 on its consolidated financial statements.

FS KKR Capital Corp.

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Policies (continued)

Recent Accounting Pronouncements:

In August 2018, the FASB issued Accounting

Standards Update 2018-13, Fair Value MeasurementDisclosures FrameworkChanges to Disclosure Requirements of Fair Value Measurement (Topic 820), or ASU 2018-13.

ASU 2018-13 introduces new fair value disclosure requirements and

eliminates and modifies certain existing fair value disclosure requirements.

ASU 2018-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019.

The Company is currently evaluating the impact

of ASU 2018-13 on its financial statements.

Derivative Instruments:

The Companys derivative instruments include

foreign currency forward contracts and cross currency swaps.

The Companys derivative instruments include foreign

currency forward contracts and cross currency swaps.

The Company recognizes all derivative instruments as assets or liabilities at fair value in its consolidated financial statements.

9 unchanged sentences

Share Repurchase Program

Fractional Share Repurchase

Issuance of Common Stock

Net Proceeds from Share Transactions

During the year ended December 31, 2019, the administrator for the Companys distribution

reinvestment plan, or DRP, purchased 4,278,880 shares of common stock in the open market at an average price per share of $5.98 (totaling $26) pursuant to the DRP, and distributed such shares to participants in the DRP.

During the year ended

December 31, 2018, the administrator for the DRP purchased 1,971,585 shares of common stock in the open market at an average price per share of $7.61 (totaling $15) pursuant to the DRP, and distributed such shares to participants in the DRP.

During the period from January 1, 2020 to February 26, 2020, the administrator for the DRP purchased 1,082,652 shares of common stock in the open market at an average price per share of $6.28 (totaling $7) pursuant to the DRP, and

distributed such shares to participants in the DRP.

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

During the year ended December 31, 2020, the administrator for the Companys distribution reinvestment plan, or DRP, purchased

1,504,389 shares of common stock in the open market at an average price per share of $15.84 (totaling $24) pursuant to the DRP, and distributed such shares to participants in the DRP.

During the year ended December 31, 2019, the administrator

for the DRP purchased 1,069,720 shares of common stock in the open market at an average price per share of $23.90 (totaling $26) pursuant to the DRP, and distributed such shares to participants in the DRP.

During the period from January 1, 2021

to February 26, 2021, the administrator for the DRP purchased 275,642 shares of common stock in the open market at an average price per share of $17.21 (totaling $5) pursuant to the DRP, and distributed such shares to participants in the DRP.

For additional information regarding the terms of the DRP, see Note 5.

In accordance with the terms of the Merger Agreement, at the time of the transactions contemplated by the Merger

Agreement, each outstanding share of CCT common stock was converted into the right to receive 2.3552 shares of the Companys common stock (with CCT stockholders receiving cash in lieu of fractional shares of the

Companys common stock).

In accordance with the terms of the 2018 Merger Agreement, at the time of the transactions contemplated by the 2018 Merger Agreement, each

outstanding share of CCT common stock was converted into the right to receive 2.3552 shares of the Companys common stock (with CCT stockholders receiving cash in lieu of fractional shares of the Companys common

As a result, the Company issued an aggregate of 292,324,670 shares of its common stock to former CCT stockholders.

Share and exchange ratio amounts in the foregoing do not reflect the Reverse Stock Split as discussed below.

February 2018 Share Repurchase Program

In February 2018, the

Companys board of directors authorized a stock repurchase program.

Under the program, the Company was permitted to repurchase up to $50 in the aggregate of its outstanding common stock in the open market at prices below the then-current

net asset value per share.

During the year ended December 31, 2018, the Company repurchased 6,571,347 shares of common stock pursuant to the share repurchase program at an average price per share (inclusive of commissions paid) of $7.61

(totaling $50).

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

FS KKR Capital Corp.

In February 2018, the Companys board of directors authorized a stock repurchase program.

Under the program, the Company was permitted to repurchase up to $50 in the aggregate of its outstanding

common stock in the open market at prices below the then-current net asset value per share.

During the year ended December 31, 2018, the Company repurchased 1,642,837 shares of common stock pursuant to the share repurchase program at an

average price per share (inclusive of commissions paid) of $30.44 (totaling $50).

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

FS Investment Corporation

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

(in thousands, except share and per share amounts)

Share Transactions (continued)

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In December 2018, the Companys board of directors authorized a stock repurchase program.

Under the program, the Company is 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 timing, manner, price and amount of any share repurchases will be determined by the

Company, based upon the evaluation of economic and market conditions, the Companys stock price, applicable legal and regulatory requirements and other factors.

On November 19, 2019, the program was extended through December 19, 2020

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

The program may be suspended, extended, modified or discontinued at any time.

During the year ended December 31, 2019, the Company repurchased 25,151,675 shares of common stock pursuant to the share repurchase

program at an average price per share (inclusive of commissions paid) of $6.08 (totaling $153).

During the period from January 1, 2020 to February 26, 2020, the Company repurchased 2,933,435 shares of common stock pursuant to the share

repurchase program at an average price per share (inclusive of commissions paid) of $6.25 (totaling $18).

Related Party

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.

During the year ended December 31, 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).

During the year ended December 31, 2019, the Company repurchased 6,287,919 shares of common stock pursuant to the share repurchase program at an average price per share (inclusive of commissions paid) of $24.30

(totaling $153).

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

Reverse Stock Split and Fractional Shares

As a result of the Reverse Stock

Split, which was effective on June 15, 2020, every four shares of the Companys common stock issued and outstanding were automatically combined into one share of the Companys common stock, and the number of outstanding shares of the

Companys common stock was reduced from approximately 495.0 million to approximately 123.75 million as of June 15, 2020.

The Reverse Stock Split did not modify the rights or preferences of the Companys common stock.

Company also filed a separate Articles of Amendment to Articles of Incorporation with the State Department of Assessments and Taxation of the State of Maryland to provide that there would be no change in the par value of $0.001 per share as a result

of the Reverse Stock Split.

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.

June 15, 2020.

Related Party Transactions

Compensation of the Investment Adviser

Pursuant to the investment advisory agreement, the Advisor is entitled to a base management fee calculated at an annual rate of 1.50% of the average weekly value of the Companys gross assets

excluding cash and cash equivalents (gross assets equal the total assets of the Company as set forth on the Companys consolidated balance sheets) and an incentive fee based on the Companys performance.

Effective June 15, 2019, in

connection with stockholder approval of the modification of the asset coverage requirement applicable to senior securities from 200% to 150%, the Advisor reduced (by permanent waiver) the annual base management fee payable under the investment

advisory agreement from 1.5% to 1.0% on all assets financed using leverage over 1.0x debt-to-equity.

Pursuant to the investment advisory

agreement, the Advisor is entitled to a base management fee calculated at an annual rate of 1.50% of the average weekly value of the Companys gross assets excluding cash and cash equivalents (gross assets equal the total assets of the Company

as set forth on the Companys consolidated balance sheets) and an incentive fee based on the Companys performance.

Effective June 15, 2019, in connection with stockholder approval of the modification of the asset coverage requirement

applicable to senior securities from 200% to 150%, the Advisor reduced (by permanent waiver) the annual base management fee payable under the investment advisory agreement from 1.5% to 1.0% on all assets financed using leverage over 1.0x debt-to-equity.

The base management fee is payable quarterly in arrears.

part of the base management fee not taken as to any quarter will be deferred without interest and may be taken in such other quarter as the Advisor determines.

The prior investment advisory agreement had substantially similar terms, except that cash

and cash equivalents were not excluded from gross assets.

See Note 2 for a discussion of the capital gains and subordinated income incentive fees that the Advisor may be entitled to under the investment advisory agreement.

Pursuant to the FB Advisor investment advisory agreement, which was in effect until April 9, 2018, FB Advisor was entitled to an

annual base management fee equal to 1.75% of the average value of the Companys gross assets (gross assets equal the total assets of the Company as set forth on the Companys consolidated balance sheets) and an incentive fee based on the

Companys performance.

FB Advisor had agreed, effective October 1, 2017, to (a) waive a portion of the base management fee to which it was entitled under the FB Advisor investment advisory agreement so that the fee received equaled

1.50% of the average value of the Companys gross assets and (b) continue to calculate the subordinated incentive fee on income to which it was entitled under the FB Advisor investment advisory agreement as if the base management fee was

1.75% of the average value of the Companys gross assets.

All or any part of the base management fee not taken as to any quarter will be deferred without

interest and may be taken in such other quarter as the Advisor determines.

The prior investment advisory agreement had substantially similar terms, except that cash and cash equivalents were not excluded from gross assets.

See Note 2 for a

discussion of the capital gains and subordinated income incentive fees that the Advisor may be entitled to under the investment advisory agreement.

Pursuant to the FB Advisor investment advisory agreement, which was in effect until April 9, 2018, FB Advisor was entitled to an annual base management fee equal to 1.75% of the average value of

the Companys gross assets (gross assets equal the total assets of the Company as set forth on the Companys consolidated balance sheets) and an incentive fee based on the Companys performance.

FB Advisor had agreed, effective

October 1, 2017, to (a) waive a portion of the base management fee to which it was entitled under the FB Advisor investment advisory agreement so that the fee received equaled 1.50% of the average value of the Companys gross assets

and (b) continue to calculate the subordinated incentive fee on income to which it was entitled under the FB Advisor investment advisory agreement as if the base management fee was 1.75% of the average value of the Companys gross

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Related Party

Transactions (continued)

Pursuant to the investment sub-advisory agreement, GDFM was entitled to receive 50% of all management and incentive fees payable to FB

10 unchanged sentences

professional services rendered to the Company by others.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Related Party

Transactions (continued)

Pursuant to the administration agreement, the Company reimburses the Advisor for

expenses necessary to perform services related to its administration and operations, including the Advisors allocable portion of the compensation and related expenses of certain personnel of Franklin Square Holdings, L.P., which does business

as FS Investments, or FS Investments, and KKR Credit Advisors (US), LLC, or KKR Credit, providing administrative services to the Company on behalf of the Advisor.

The Company reimburses the Advisor no less than quarterly for all costs and expenses

incurred by the Advisor in performing its obligations and providing personnel and facilities under the administration agreement.

The Advisor allocates the cost of such services to the Company based on factors such as total assets, revenues, time

allocations and/or other reasonable metrics.

The Companys board of directors reviews the methodology employed in determining how the expenses are allocated to the Company and the proposed allocation of administrative expenses among the Company

and certain affiliates of the Advisor.

The Companys board of directors then assesses the reasonableness of such reimbursements for expenses allocated to it based on the breadth, depth and quality of such services as compared to the estimated

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

In addition, the Companys 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, the Companys board of directors compares the total amount paid to the Advisor for such services as a percentage of the Companys net assets to the same ratio as reported by other

comparable BDCs.

Pursuant to the administration agreement, the Company reimburses the

Advisor for expenses necessary to perform services related to its administration and operations, including the Advisors allocable portion of the compensation and related expenses of certain personnel of Franklin Square Holdings, L.P., which

does business as FS Investments, or FS Investments, and KKR Credit Advisors (US), LLC, or KKR Credit, providing administrative services to the Company on behalf of the Advisor.

The Company reimburses the Advisor no less than quarterly for all costs

and expenses incurred by the Advisor in performing its obligations and providing personnel and facilities under the administration agreement.

The Advisor allocates the cost of such services to the Company based on factors such as total assets,

revenues, time allocations and/or other reasonable metrics.

The Companys board of directors reviews the methodology employed in determining how the expenses are allocated to the Company and the proposed allocation of administrative expenses

among the Company and certain affiliates of the Advisor.

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

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

In addition, the Companys 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, the Companys board of directors compares the total amount paid to the Advisor for such services as a percentage of the Companys net assets to the same ratio

as reported by other comparable BDCs.

The FB Advisor administration agreement was substantially similar to the administration agreement.

following table describes the fees and expenses accrued under the investment advisory agreement, the prior investment advisory agreement, the FB Advisor investment advisory agreement, the administration agreement and the FB Advisor administration

agreement, as applicable, during the years ended December 31, 2019, 2018 and 2017:

The following table describes the fees and expenses accrued under the investment advisory agreement, the prior investment advisory agreement, the FB Advisor investment advisory agreement, the

administration agreement and the FB Advisor administration agreement, as applicable, during the years ended December 31, 2020, 2019 and 2018:

Year Ended December 31,

10 unchanged sentences

Administrative Services Expenses (3)

FB Advisor agreed, effective October 1, 2017, to waive a portion of the base management fee to which it was entitled under the FB Advisor

investment advisory agreement so that the fee received equaled 1.50% of the average value of the Companys gross assets.

For the years ended December 31, 2018 and 2017, the amount shown is net of waivers of $3 and $3, respectively.

the years ended December 31, 2019, 2018 and 2017, $105, $59, and $73, respectively, in base management fees were paid to the Advisor and/or FB Advisor.

For the year ended December 31, 2018 , the amount shown is net of waivers of $3.

During the years ended December 31, 2020, 2019 and

2018, $111, $105, and $59, respectively, in base management fees were paid to the Advisor and/or FB Advisor.

As of December 31, 2020, $25 in base management fees were payable to the Advisor.

During the year ended December 31, 2019, $71 of subordinated incentive fees on income were paid to the Advisor.

During the year ended December 31, 2020 and 2019, $0 and $71, respectively, of subordinated incentive fees on income were paid to the

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Related Party

Transactions (continued)

During the years ended December 31, 2020, 2019 and 2018, $6, $6 and $3, respectively, of administrative services expenses related to the

7 unchanged sentences

Company does, or of investment vehicles managed by the same personnel.

For example, the Advisor is the investment adviser to FS KKR Capital Corp.

II, and the officers, managers and other personnel of the Advisor may serve in similar or other

capacities for the investment advisers to future

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Related Party

Transactions (continued)

investment vehicles affiliated with FS Investments or KKR Credit.

In serving in these multiple and other capacities, they may have obligations to other clients or investors in those entities, the

fulfillment of which may not be in the Companys best interests or in the best interest of the Companys stockholders.

The Companys investment objectives may overlap with the investment objectives of such investment funds, accounts

or other investment vehicles.

For example, the Advisor is the investment adviser to FSKR, and the officers, managers and other personnel of the Advisor may serve in similar or other capacities for the

investment advisers to future investment vehicles affiliated with FS Investments or KKR Credit.

In serving in these multiple and other capacities, they may have obligations to other clients or investors in those entities, the fulfillment of which

may not be in the Companys best interests or in the best interest of the Companys stockholders.

The Companys investment objectives may overlap with the investment objectives of such investment funds, accounts or other investment

Exemptive Relief

6 unchanged sentences

exemptive relief permitting the Company, subject to the satisfaction of certain conditions, to co-invest in certain privately negotiated investment transactions with certain affiliates of

FB Advisor, including FS Energy and Power Fund, FS KKR Capital Corp.

II and any future BDCs that are advised by FB Advisor or its affiliated investment advisers.

However, in connection with the investment advisory relationship with the Advisor, and

in an effort to mitigate potential future conflicts of interest, the Companys board of directors authorized and directed that the Company (i) withdraw from the FS Order, except with respect to any transaction in which the Company

participated in reliance on the FS Order prior to April 9, 2018, and (ii) rely on an exemptive relief order, dated April 3, 2018, that permits the Company, subject to the satisfaction of certain

FB Advisor, including FS Energy and Power Fund, FSKR and any future BDCs that are advised by FB Advisor or its affiliated investment advisers.

However, in connection with the investment advisory relationship with the Advisor, and in an effort to

mitigate potential future conflicts of interest, the Companys board of directors authorized and directed that the Company (i) withdraw from the FS Order, except with respect to any transaction in which the Company participated in reliance

on the FS Order prior to April 9, 2018, and (ii) rely on an exemptive relief order, dated January 5, 2021, that permits the Company, subject to the satisfaction of certain

conditions, to co-invest in certain privately negotiated investment transactions, including investments originated and directly negotiated by the Advisor or KKR Credit, with certain

affiliates of the Advisor.

Affiliated Purchaser Program

As previously disclosed, certain affiliates of the owners of the Advisor committed $100 to a $350 investment vehicle that may invest from time to time in shares of the Company.

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.

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

Distributions

The following table reflects the cash distributions per share that the Company has declared on its common stock during the years ended December 31, 2019, 2018 and 2017:

The following table reflects the cash distributions per share that the Company has declared on its common stock during the years ended

December 31, 2020, 2019 and 2018:

For the Year Ended December 31,

Per Share (1)

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

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Distributions (continued)

Includes a $0.36 per share special cash distribution that was paid on December 3, 2018.

13 unchanged sentences

or (B) if the market price is less than the net asset value per share, then, in the sole discretion of the Company, (i) shares of common stock will be purchased in open market transactions for the accounts of

participants to the extent practicable, or (ii) the Company will issue shares of common stock at

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Distributions (continued)

net asset value per share.

Pursuant to the terms of the DRP, the number of shares of common stock to be issued to a participant will be determined by dividing the total dollar amount of the

distribution payable to a participant by the price per share at which the Company issues such shares;

provided, however, that shares purchased in open market transactions by the plan administrator will be allocated to a participant based on the

average purchase price, excluding any brokerage charges or other charges, of all shares of common stock purchased in the open market.

participants to the extent practicable, or (ii) the Company will issue shares of common stock at net asset value per share.

Pursuant to the terms of the DRP, the number of shares of common stock to be issued to a participant will be determined

by dividing the total dollar amount of the distribution payable to a participant by the price per share at which the Company issues such shares;

provided, however, that shares purchased in open market transactions by the plan administrator will be

allocated to a participant based on the average purchase price, excluding any brokerage charges or other charges, of all shares of common stock purchased in the open market.

If a stockholder receives distributions in the form of common stock pursuant to the DRP, such stockholder generally will be subject to the same federal, state and local tax consequences as if it elected

20 unchanged sentences

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 years ended December 31, 2019, 2018 and 2017:

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Distributions (continued)

The following table reflects the sources of the cash distributions on a tax basis that

the Company has declared on its common stock during the years ended December 31, 2020, 2019 and 2018:

Year Ended December 31,

8 unchanged sentences

income was attributable to cash income earned, 1.6%, 1.8% and 1.8%, respectively, was attributable to non-cash accretion of discount and 10.3%, 7.7% and 13.9%, respectively, was attributable to paid-in-kind, or PIK, interest.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Distributions (continued)

The Companys net investment income on a tax basis for the years ended

December 31, 2019, 2018 and 2017 was $422, $244 and $206, respectively.

As of December 31, 2019, 2018 and 2017, the Company had $220, $191 and $151, respectively, of undistributed net investment income and $480, $421 and $198,

respectively, of accumulated capital losses on a tax basis.

The Companys undistributed net investment income on a tax

basis as of December 31, 2018 was adjusted following the filing of the Companys 2018 tax return in October 2019.

The adjustment was primarily due to tax-basis income received by the Company during

the year ended December 31, 2018 exceeding GAAP-basis income on account of certain collateralized securities and interests in partnerships, and the reclassification of realized gains and losses upon the sale of certain collateralized securities

held in its investment portfolio during such period.

The tax notices for such collateralized securities and interests in partnerships were received by the Company subsequent to the filing of the Companys annual report on Form 10-K for the year ended December 31, 2018.

The difference between the Companys

GAAP-basis net investment income and its tax-basis net investment income is primarily due to the reclassification of unamortized original issue discount and prepayment fees recognized upon prepayment of loans

from income for GAAP purposes to realized gains or deferred to future periods for tax purposes, the impact of consolidating certain subsidiaries for purposes of computing GAAP-basis net investment income but not for purposes of computing tax-basis net investment income, the reversal of non-deductible excise taxes and income recognized for tax purposes on certain transactions but not recognized for GAAP

The following table sets forth a reconciliation between GAAP-basis net investment income and tax-basis net investment income during the years ended December 31, 2019, 2018 and 2017:

The Companys net investment income on a tax basis for the years ended December 31, 2020, 2019 and 2018 was $357, $422 and $244,

respectively.

As of December 31, 2020, 2019 and 2018, the Company had $244, $220 and $191, respectively, of undistributed net investment income and $855, $480 and $421, respectively, of accumulated capital losses on a tax basis.

The Companys undistributed net investment income on a tax basis may be adjusted following the filing of the Companys tax

The adjustment is in general due to tax-basis income received by the Company differing from GAAP-basis income on account of certain collateralized securities and interests in partnerships, and the reclassification of realized gains and

losses upon the sale of certain collateralized securities held in its investment portfolio during such period.

The difference

between the Companys GAAP-basis net investment income and its tax-basis net investment income is primarily due to the reclassification of unamortized original issue discount and prepayment fees

recognized upon prepayment of loans from income for GAAP purposes to realized gains or deferred to future periods for tax purposes, the impact of consolidating certain subsidiaries for purposes of computing GAAP-basis net investment income but not

for purposes of computing tax-basis net investment income, the reversal of non-deductible excise taxes and income recognized for tax purposes on certain transactions but

not recognized for GAAP purposes.

The following table sets forth a reconciliation between GAAP-basis net investment income and

tax-basis net investment income during the years ended December 31, 2020, 2019 and 2018:

Year Ended December 31,

5 unchanged sentences

Tax-basis net investment income

The Company may make certain adjustments to the classification of stockholders equity as a result of

permanent book-to-tax differences.

During the year ended December 31, 2019, the Company increased accumulated undistributed (distributions in excess of) net

investment income and accumulated undistributed net realized gain (loss) on investments and gain (loss) on foreign currency by $15 and $26, respectively, and decreased capital in excess of par value by $41.

During the year ended December 31,

2018, the Company increased capital in excess of par value and accumulated undistributed (distributions in excess of) net investment income by $186 and $38, respectively, and decreased accumulated undistributed net realized gain (loss) on

investments and gain (loss) on foreign currency by $224.

The determination of the tax attributes of the Companys

distributions is made annually as of the end of the Companys fiscal year based upon the Companys taxable income for the full year and distributions paid for the full year.

The actual tax characteristics of distributions to stockholders

are reported to stockholders annually on Form 1099-DIV.

FS KKR Capital Corp.

2 unchanged sentences

Distributions (continued)

As of December 31, 2019 and 2018, the components of accumulated earnings on a tax

basis were as follows:

The Company may make certain adjustments to the classification of stockholders

equity as a result of permanent book-to-tax differences.

During the year ended December 31, 2020, the Company increased accumulated undistributed (distributions in

excess of) net investment income and accumulated undistributed net realized gain (loss) on investments and gain (loss) on foreign currency by $10 and $119, respectively, and decreased capital in excess of par value by $129.

During the year ended

December 31, 2019, the Company increased accumulated undistributed (distributions in excess of) net investment income and accumulated undistributed net realized gain (loss) on investments and gain (loss) on foreign currency by $15 and $26,

respectively, and decreased capital in excess of par value by $41.

The determination of the tax attributes of the

Companys distributions is made annually as of the end of the Companys fiscal year based upon the Companys taxable income for the full year and distributions paid for the full year.

The actual tax characteristics of distributions to

stockholders are reported to stockholders annually on Form 1099-DIV.

December 31, 2020 and 2019, the components of accumulated earnings on a tax basis were as follows:

Year Ended December 31,

5 unchanged sentences

December 31, 2020, the Company had short-term and long-term capital loss carryforwards available to offset future realized capital gains of $34 and $821, 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.

$85 of such losses were carried over from CCT due to the 2018 Merger, and

$177 of such losses were carried over from losses generated by the Company prior to the 2018 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.

Any unused balances resulting from such

limitations may be carried forward into future years indefinitely.

As of December 31, 2020 and 2019, the gross unrealized appreciation was $1,121 and $1,087, respectively.

14 unchanged sentences

For the year ended December 31, 2020, the Company did not record a provision for taxes related to wholly-owned taxable subsidiaries.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Investment Portfolio

The following table summarizes the composition of the Companys investment portfolio at cost and fair value as of December 31, 2019 and 2018:

The following table summarizes the composition of the Companys investment portfolio at cost and fair value as of December 31,

2020 and 2019:

December 31, 2020

7 unchanged sentences

Amortized cost represents the original cost adjusted for the amortization of premiums and/or accretion of discounts, as applicable, on

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Investment Portfolio (continued)

In general, under the 1940 Act, the Company would be presumed to control a

1 unchanged sentence

5% or more of its voting securities.

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

As of December 31, 2020, the Company held investments in ten portfolio companies of

which it is deemed to control. As of December 31, 2020, the Company held investments in thirteen 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, 2020.

As of December 31, 2018, the Company held investments in eight portfolio companies of which it is deemed to control. As of December 31, 2018, the Company held investments in twelve

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

3 unchanged sentences

the terms of the underlying agreements.

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

Strategic Credit Opportunities Partners, LLC.

As of December 31, 2018, the Company had unfunded debt investments with aggregate unfunded commitments of $172.4, unfunded equity commitments of $386.7 and unfunded commitments of $143.5 of

Strategic Credit Opportunities Partners, LLC.

As of December 31, 2020, the Company had unfunded debt investments with aggregate unfunded commitments of $228.4, unfunded equity/other commitments of $142.9 and unfunded commitments of $65.8 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/other 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 consolidated schedule of investments as of December 31, 2019 and 2018.

For additional details regarding the Companys unfunded debt investments, see

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

FS KKR Capital Corp.

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Industry Classification

Percentage of

Automobiles & Components

31 unchanged sentences

As of December 31, 2020, the Company and SCRS have funded approximately $924.8 to SCJV, of which $809.2 was from the Company.

Jersey City Funding LLC, or Jersey City Funding, a wholly-owned subsidiary of SCJV, has a revolving credit facility with Goldman Sachs Bank, or as amended, the Jersey City Funding Credit Facility, which

provides for up to $350 of borrowings as of

FS KKR Capital Corp.

2 unchanged sentences

Investment Portfolio (continued)

Jersey City Funding LLC, or Jersey City Funding, a wholly-owned subsidiary of SCJV, has

a revolving credit facility with Goldman Sachs Bank, or as amended, the Jersey City Funding Credit Facility, which provides for up to $400 of borrowings as of December 31, 2019.

December 31, 2020.

The Jersey City Funding Credit Facility provides loans in U.S.

dollars, Australian dollars, Euros and pounds sterling.

dollar loans bear interest at the rate of LIBOR plus 2.25%.

dollars, Australian dollars, Euros, pounds sterling and Canadian dollars.

dollar loans bear

interest at the rate of LIBOR plus 2.25%.

Foreign currency loans bear interest at the floating rate plus the spread applicable to the specified currency.

Funding also pays a commitment fee of up to 0.50% on undrawn commitments.

The Jersey City Funding Credit Facility matures on September 29, 2021.

As of December 31, 2019, total outstanding borrowings under the Jersey City Funding Credit

Facility were $236.7.

Borrowings under the Jersey City Funding Credit Facility are secured by substantially all of the assets of Jersey City Funding.

On September 18, 2019, Chestnut Street Funding LLC, or Chestnut Street Funding, a wholly-owned subsidiary of SCJV, entered into a revolving credit facility, or the Chestnut Street Funding Credit

Facility, with Citibank, N.A., or Citibank, as administrative agent and lender, and Wells Fargo Bank, National Association, as collateral agent.

The Chestnut Street Funding Credit Facility provides loans in U.S.

dollars, Australian dollars, Canadian

dollars, Euros and pounds sterling.

Jersey City Funding also pays a commitment fee of up to 0.50% on undrawn commitments.

Jersey City Funding Credit Facility matures on September 29, 2021.

As of December 31, 2020, total outstanding borrowings under the Jersey City Funding Credit Facility were $341.9.

Borrowings under the Jersey City Funding Credit Facility

are secured by substantially all of the assets of Jersey City Funding.

Chestnut Street Funding LLC, or Chestnut Street

Funding, a wholly-owned subsidiary of SCJV, has a revolving credit facility with Citibank, N.A., or as amended, the Chestnut Street Funding Credit Facility, which provides for up to $400 of borrowings as of December 31, 2020.

Street Funding Credit Facility provides loans in U.S.

dollars, Australian dollars, Canadian dollars, Euros and pounds sterling.

dollar loans bear interest at the rate of three-month LIBOR plus 2.25%.

Foreign currency loans bear interest at the applicable floating rate plus 2.25%.

Chestnut Street Funding also pays a commitment fee of

up to 0.50% on undrawn commitments.

Foreign currency loans bear interest at the

applicable floating rate plus 2.25%.

Chestnut Street Funding also pays a commitment fee of up to 0.50% on undrawn commitments.

The Chestnut Street Funding Credit Facility matures on September 18, 2024.

As of December 31, 2019, total outstanding borrowings under the Chestnut Street Funding Credit Facility were $229.4.

During the year ended December 31, 2019, the Company sold investments with a cost of $693.1 for proceeds of $731.6 to SCJV and

recognized a net realized gain (loss) of $38.5 in connection with the transactions.

As of December 31, 2019, $621.6 of these sales to SCJV are included in receivable for investments sold in the consolidated statements of assets and liabilities.

As of December 31, 2020, total

outstanding borrowings under the Chestnut Street Funding Credit Facility were $294.2.

Borrowings under the Chestnut Street Funding Credit Facility are secured by substantially all of the assets of Chestnut Street Funding.

Boxwood Drive Funding LLC, or Boxwood Drive Funding, a wholly-owned subsidiary of SCJV, has a revolving credit facility with BNP Paribas,

or the Boxwood Drive Funding Credit Facility, which provides for up to $300 of borrowings as of December 31, 2020.

The Boxwood Drive Funding Credit Facility provides for loans in U.S.

dollars, Australian dollars, Canadian dollars, New Zealand

dollars, Euros and pounds sterling.

dollar loans bear interest at the rate of LIBOR plus a spread of 2.05% to 3.15% during the reinvestment period and 2.50% to 3.25% thereafter.

Foreign currency of loans bear interest at the applicable floating

rate plus the applicable spread.

Boxwood Drive Funding also pays a commitment fee of up to 1.00% on undrawn commitments.

The Boxwood Drive Funding Credit Facility matures on April 15, 2025.

As of December 31, 2020, total outstanding

borrowings under the Boxwood Drive Funding Credit Facility were $85.9.

Borrowings under the Boxwood Drive Funding Credit Facility are secured by substantially all of the assets of Boxwood Drive Funding.

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

During the year ended December 31, 2020, the Company sold investments with a cost of $450.7 for proceeds of $416.4 to

SCJV and recognized a net realized gain (loss) of $(34.3) in connection with the transactions.

As of December 31, 2020, $163.2 of these sales to SCJV are included in receivable for investments sold in the consolidated statements of assets and

As of December 31, 2020, SCJV had total investments with a fair value of $1,544.3.

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 December 31, 2019 and 2018:

As of December 31,

2020, SCJV had two 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 December 31, 2020 and 2019:

Total debt investments (1)

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Senior Secured LoansFirst Lien124.6%

1a Smart Start LLC

Technology Hardware & Equipment

1a Smart Start LLC

Technology Hardware & Equipment

A10 Capital LLC

Diversified Financials

ABB CONCISE Optical Group LLC

Apex Group Limited

2 unchanged sentences

Diversified Financials

Apex Group Limited

Diversified Financials

Ardonagh Group Ltd

Arrotex Australia Group Pty Ltd

Pharmaceuticals, Biotechnology & Life Sciences

BearCom Acquisition Corp

Technology Hardware & Equipment

Arrotex Australia Group Pty Ltd

Pharmaceuticals, Biotechnology & Life Sciences

BearCom Acquisition Corp

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Consumer Services

Brand Energy & Infrastructure Services Inc

Capital Goods

Bugaboo International BV

Consumer Durables & Apparel

7.8% PIK (7.8%

Casual Dining Group Ltd

Consumer Services

PIK (0.8% Max

Casual Dining Group Ltd

Consumer Services

Casual Dining Group Ltd

Consumer Services

Catapult Learning LLC

Consumer Services

Catapult Learning LLC

Cambium Learning Group Inc

Consumer Services

12 unchanged sentences

Consumer Services

Catapult Learning LLC

Consumer Services

Catapult Learning LLC

Consumer Services

Child Development Schools Inc

2 unchanged sentences

Consumer Services

CommerceHub Inc

Software & Services

Commercial Barge Line Co

Transportation

DB Datacenter Holdings Inc

Software & Services

Health Care Equipment

E+825, 1.8% PIK

(1.8% Max PIK)

Health Care Equipment

E+825, 1.8% PIK

(1.8% Max PIK)

CSM Bakery Products

Food, Beverage & Tobacco

Diamond Resorts International Inc

1 unchanged sentence

Eacom Timber Corp

Frontline Technologies Group LLC

Software & Services

HealthChannels LLC

Health Care Equipment & Services

Highline Aftermarket Acquisition LLC

Automobiles & Components

Huws Gray Ltd

Commercial & Professional Services

PIK (2.3% Max

Commercial & Professional Services

PIK (2.3% Max

Commercial & Professional Services

PIK (2.3% Max

Commercial & Professional Services

Imagine Communications Corp

Media & Entertainment

Imagine Communications Corp

Media & Entertainment

PIK (2.3% Max

Industria Chimica Emiliana Srl

Pharmaceuticals, Biotechnology & Life Sciences

Kellermeyer Bergensons Services LLC

Commercial & Professional Services

FS KKR Capital Corp.

3 unchanged sentences

Interest Rate (b)

Print Solutions Inc

Media & Entertainment

Industria Chimica Emiliana Srl

Pharmaceuticals, Biotechnology & Life Sciences

Kettle Cuisine LLC

2 unchanged sentences

Commercial & Professional Services

Lionbridge Technologies Inc

Consumer Services

MedAssets Inc

Health Care Equipment & Services

P2 Energy Solutions, Inc.

Software & Services

Parts Authority Inc

Automobiles & Components

Parts Authority Inc

Automobiles & Components

Parts Authority Inc

Automobiles & Components

Parts Town LLC

Precision Global Corp

Premium Credit Ltd

Diversified Financials

Project Marron

2 unchanged sentences

Consumer Services

Quirch Foods Co

Food & Staples Retailing

Sentry Data Systems Inc

Health Care Equipment & Services

Sentry Data Systems Inc

Qdoba Restaurant Corp

Consumer Services

Reliant Rehab Hospital Cincinnati LLC

Health Care Equipment & Services

Sentry Data Systems Inc

Roadrunner Intermediate Acquisition Co LLC

Health Care Equipment & Services

Safe-Guard Products International LLC

Diversified Financials

Capital Goods

L+675, 0.0% PIK

(1.0% Max PIK)

Smart & Final Stores LLC

Food & Staples Retailing

SMART Global Holdings Inc

Semiconductors & Semiconductor Equipment

SMART Global Holdings Inc

Semiconductors & Semiconductor Equipment

Staples Canada

Technimark LLC

Total Safety US Inc

Capital Goods

Transaction Services Group Ltd

Consumer Services

Software & Services

Virgin Pulse Inc

Software & Services

Yak Access LLC

Capital Goods

Total Senior Secured LoansFirst Lien

FS KKR Capital Corp.

2 unchanged sentences

Investment Portfolio (continued)

Weld North Education LLC

Software & Services

Total Senior Secured LoansFirst Lien

Unfunded Loan Commitments

1 unchanged sentence

Senior Secured LoansSecond Lien28.9%

Access CIG LLC

Commercial & Professional Services

Ammeraal Beltech Holding BV

1 unchanged sentence

BCA Marketplace PLC

Casual Dining Group Ltd

Consumer Services

(11.5% Max PIK)

Excelitas Technologies Corp

Technology Hardware & Equipment

Software & Services

Resource Label Group LLC

Capital Goods

L+1,075, 0.0% PIK

(6.8% Max PIK)

SIRVA Worldwide Inc

Commercial & Professional Services

Watchfire Enterprises Inc

Technology Hardware & Equipment

WireCo WorldGroup Inc

Capital Goods

Wittur Holding GmbH

Capital Goods

E+850, 0.5% PIK

(0.5% Max PIK)

Total Senior Secured LoansSecond Lien

Other Senior Secured Debt1.0%

Cleaver-Brooks Inc

Capital Goods

Total Other Senior Secured Debt

Subordinated Debt5.3%

Home Partners of America Inc

Kenan Advantage Group Inc

Transportation

Software & Services

Total Subordinated Debt

Asset Based Finance30.2%

Comet Aircraft S.a.r.l., Common Stock

Capital Goods

FS KKR Capital Corp.

3 unchanged sentences

Interest Rate (b)

Asset Based Finance23.8%

Comet Aircraft S.a.r.l., Common Stock

Capital Goods

GA Capital Specialty Lending Fund, Limited Partnership Interest

2 unchanged sentences

Diversified Financials

KKR Zeno Aggregator LP (K2 Aviation)

KKR Zeno Aggregator LP (K2 Aviation), Partnership Interest

Capital Goods

3 unchanged sentences

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.

8 unchanged sentences

(7.5% Max PIK)

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Investment Portfolio (continued)

Interest Rate (b)

Sealane Trade Finance

4 unchanged sentences

Software & Services

Casual Dining Group Ltd, Common Stock

Consumer Services

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Investment Portfolio (continued)

Interest Rate (b)

Home Partners of America Inc, Common Stock

1 unchanged sentence

TOTAL INVESTMENTS189.7%

Derivative Instruments(1.4)%

Foreign currency forward contracts

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

1 unchanged sentence

basis point spread.

As of December 31, 2019, the three-month London Interbank Offered Rate, or LIBOR or L, was 1.91% and the Euro Interbank Offered Rate, or EURIBOR, was (0.38)% and the Australian Interbank Rate, or BBSY or

B, was 0.92%.

As of December 31, 2020, the three-month London Interbank Offered Rate, or LIBOR or L, was 0.24% and the Euro Interbank Offered Rate, or EURIBOR, was (0.55)%, Canadian Dollar Offer Rate, or CDOR, was 0.48% and

the Australian Interbank Rate, or BBSY or B, was 0.06%.

PIK means paid-in-kind.

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

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

Denominated in U.S.

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rate received upon funding.

Asset is on non-accrual status.

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

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Investment Portfolio (continued)

Security or portion thereof held within JCF Cayman Ltd and is pledged as collateral supporting the amounts outstanding under the revolving

credit facility with Goldman Sachs.

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

revolving credit facility with BNP Paribas.

Security is non-income producing.

Strategic Credit Opportunities Partners, LLC Portfolio

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Senior Secured LoansFirst Lien175.6%

Acosta Holdco Inc

Commercial & Professional Services

1a Smart Start LLC

Technology Hardware & Equipment

1a Smart Start LLC

Technology Hardware & Equipment

Apex Group Limited

2 unchanged sentences

Diversified Financials

Arrotex Australia Group Pty Ltd

Pharmaceuticals, Biotechnology & Life Sciences

BearCom Acquisition Corp

Technology Hardware & Equipment

BearCom Acquisition Corp

Technology Hardware & Equipment

BearCom Acquisition Corp

Technology Hardware & Equipment

BearCom Acquisition Corp

Technology Hardware & Equipment

Big Bus Tours Ltd

Consumer Services

Big Bus Tours Ltd

Consumer Services

Brand Energy & Infrastructure Services Inc

5 unchanged sentences

Consumer Services

L+725, 0.8% PIK

(0.8% Max PIK)

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Investment Portfolio (continued)

Interest Rate (b)

Casual Dining Group Ltd

Consumer Services

Casual Dining Group Ltd

Consumer Services

Catapult Learning LLC

Consumer Services

Catapult Learning LLC

Consumer Services

Catapult Learning LLC

Consumer Services

Catapult Learning LLC

Consumer Services

Catapult Learning LLC

Consumer Services

Catapult Learning LLC

Consumer Services

Child Development Schools Inc

Consumer Services

Child Development Schools Inc

Consumer Services

CommerceHub Inc

2 unchanged sentences

Transportation

DB Datacenter Holdings Inc

Software & Services

Health Care Equipment & Services

PIK (1.8% Max

Health Care Equipment & Services

PIK (1.8% Max

Diamond Resorts International Inc

Consumer Services

Eacom Timber Corp

Harbor Freight Tools USA Inc

HealthChannels LLC

Health Care Equipment & Services

Highline Aftermarket Acquisition LLC

Automobiles & Components

Huws Gray Ltd

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Investment Portfolio (continued)

Interest Rate (b)

Huws Gray Ltd

Commercial & Professional Services

2 unchanged sentences

Commercial & Professional Services

Imagine Communications Corp

Media & Entertainment

Imagine Communications Corp

Media & Entertainment

Print Solutions Inc

Media & Entertainment

Industria Chimica Emiliana Srl

Pharmaceuticals, Biotechnology & Life Sciences

Kettle Cuisine LLC

Food, Beverage & Tobacco

Koosharem LLC

Commercial & Professional Services

Marshall Retail Group LLC

MedAssets Inc

Health Care Equipment & Services

P2 Energy Solutions, Inc.

Software & Services

Parts Authority Inc

Automobiles & Components

Parts Authority Inc

Automobiles & Components

Parts Authority Inc

Automobiles & Components

Parts Town LLC

Precision Global Corp

Project Marron

Consumer Services

Project Marron

Consumer Services

Quirch Foods Co

Food & Staples Retailing

Sentry Data Systems Inc

Health Care Equipment & Services

FS KKR Capital Corp.

3 unchanged sentences

Interest Rate (b)

P2 Energy Solutions, Inc.

SMART Global Holdings Inc

Semiconductors & Semiconductor Equipment

Sentry Data Systems Inc

Health Care Equipment & Services

Sentry Data Systems Inc

Health Care Equipment & Services

Smart & Final Stores LLC

Food & Staples Retailing

SMART Global Holdings Inc

2 unchanged sentences

Semiconductors & Semiconductor Equipment

Standard Aero Ltd

Capital Goods

Staples Canada

TIBCO Software Inc

Technimark LLC

Transaction Services Group Ltd

Consumer Services

Weld North Education LLC

Software & Services

Transportation

Utility One Source LP

Capital Goods

Total Senior Secured LoansFirst Lien

2 unchanged sentences

Senior Secured LoansSecond Lien37.5%

Ammeraal Beltech Holding BV

Capital Goods

BCA Marketplace PLC

Casual Dining Group Ltd

Consumer Services

Total Senior Secured LoansSecond Lien

Other Senior Secured Debt2.4%

Artesyn Embedded Technologies Inc

(11.5% Max PIK)

Resource Label Group LLC

Watchfire Enterprises Inc

Technology Hardware & Equipment

Total Other Senior Secured Debt

Subordinated Debt24.2%

Cemex Materials LLC

Telecommunication Services

Wittur Holding GmbH

Capital Goods

PIK (0.5% Max

FS KKR Capital Corp.

3 unchanged sentences

Interest Rate (b)

Hillman Group Inc

Consumer Durables & Apparel

JC Penney Corp Inc

Total Senior Secured LoansSecond Lien

Subordinated Debt10.6%

Home Partners of America Inc

Kenan Advantage Group Inc

3 unchanged sentences

Asset Based Finance30.2%

Sealane Trade Finance

Comet Aircraft S.a.r.l., Common Stock

Capital Goods

GA Capital Specialty Lending Fund, Limited Partnership Interest

Diversified Financials

Global Lending Services LLC, Private Equity

Diversified Financials

KKR Zeno Aggregator LP (K2 Aviation)

Capital Goods

Lenovo Group Ltd, Structured Mezzanine

Technology Hardware & Equipment

Lenovo Group Ltd, Structured Mezzanine

Technology Hardware & Equipment

MP4 2013-2A Class Subord.

Diversified Financials

NewStar Clarendon 2014-1A

Diversified Financials

Pretium Partners LLC P1, Structured Mezzanine

2.8%, 5.3% PIK

(5.3% Max PIK)

Pretium Partners LLC P2, Structured Mezzanine

2.0%, 7.5% PIK

(7.5% Max PIK)

Sealane Trade Finance

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Investment Portfolio (continued)

Interest Rate (b)

Sealane Trade Finance

Total Asset Based Finance

Equity/Other10.9%

Casual Dining Group Ltd

ASG Technologies, Common Stock

Software & Services

Casual Dining Group Ltd, Common Stock

Consumer Services

Home Partners of America Inc, Common Stock

Total Equity/Other

5 unchanged sentences

basis point spread.

As of December 31, 2018, the three-month London Interbank Offered Rate, or LIBOR or L, was 2.81% and the Euro Interbank Offered Rate, or EURIBOR, was (0.31)%.

B, was 0.92%.

PIK means paid-in-kind.

2 unchanged sentences

dollars unless otherwise noted.

Fair value determined by the Companys board of directors.

Investments classified as Level 3.

A portfolio company domiciled in a foreign country.

The jurisdiction of the security issuer may be a different country than the domicile of

the portfolio company.

The underlying credit agreement or indenture contains a PIK provision, whereby the issuer has either the option or the obligation to make

interest payments with the issuance of additional securities.

The interest rate in the schedule represents the current interest rate in effect for these investments.

Security is an unfunded commitment.

1 unchanged sentence

rate received upon funding.

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

revolving credit facility with Goldman Sachs.

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

revolving credit facility with Citibank, N.A.

FS KKR Capital Corp.

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Statement Location

Cross currency swaps

Unrealized depreciation on swap contracts

Foreign currency forward contracts

6 unchanged sentences

Financial Instruments (continued)

Net realized and

unrealized gains and losses on derivative instruments recorded by the Company for the years ended December 31, 2019 and 2018 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 years ended December 31, 2020 and 2019 are in the following locations in the consolidated statements of operations:

Net Realized Gains (Losses)

20 unchanged sentences

December 31, 2020

Assets Subject to

Assets Subject

Master Netting

4 unchanged sentences

Available for

Net Amount of

Liabilities (3)

5 unchanged sentences

December 31, 2019

Assets Subject to

Master Netting

Available for

Net Amount of

JP Morgan Chase Bank

Master Netting

Available for

Net Amount of

Liabilities (3)

23 unchanged sentences

The average notional

balance for foreign currency forward contracts during the year ended December 31, 2019 was $198.6.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Financial Instruments (continued)

As of December 31, 2019 and 2018, the Companys open foreign currency forward

contracts were as follows:

Settlement Date

December 31, 2019

(Depreciation)

JP Morgan Chase Bank

Foreign Currency

Settlement Date

December 31, 2018

(Depreciation)

JP Morgan Chase Bank

As of December 31, 2018, the Companys open cross currency swaps were as follows:

Company Receives Fixed Rate

Company Pays Fixed Rate

(Depreciation)

JP Morgan Chase Bank

2.20% on USD notional amount of $188.1

0.00% on EUR notional amount of 177.5

balance for foreign currency forward contracts during the year ended December 31, 2020 and 2019 was $41.2 and $198.6, respectively.

See consolidated schedule of investments for the Companys open foreign currency forward contracts.

Fair Value of Financial Instruments

Under existing accounting guidance, fair value is defined as the price that the Company would receive upon selling an investment or pay to

transfer a liability in an orderly transaction to a market participant in the principal or most advantageous market for the investment.

This accounting guidance emphasizes valuation techniques that maximize the use of observable market inputs and

minimize the use of unobservable inputs.

Inputs refer broadly to the assumptions that market participants would use in pricing an asset or liability, including assumptions about risk.

Inputs may be observable or unobservable.

Observable inputs are

inputs that reflect the assumptions market participants would use in pricing an asset or liability developed based on market data obtained from sources independent of the Company.

Unobservable inputs are inputs that reflect the

Under existing accounting guidance, fair value is defined as the price that the Company would receive upon selling an investment or pay to transfer a liability in an orderly transaction to a market

participant in the principal or most advantageous

FS KKR Capital Corp.

3 unchanged sentences

Instruments (continued)

assumptions market participants would use in pricing an asset or liability developed based on the best information available in the circumstances.

The Company classifies the inputs used to

measure these fair values into the following hierarchy as defined by current accounting guidance:

market for the investment.

This accounting guidance emphasizes valuation techniques that maximize the use of observable market inputs and minimize the use of unobservable inputs.

broadly to the assumptions that market participants would use in pricing an asset or liability, including assumptions about risk.

Inputs may be observable or unobservable.

Observable inputs are inputs that reflect the assumptions market participants

would use in pricing an asset or liability developed based on market data obtained from sources independent of the Company.

Unobservable inputs are inputs that reflect the assumptions market participants would use in pricing an asset or liability

developed based on the best information available in the circumstances.

The Company classifies the inputs used to measure these fair values into the following hierarchy as defined by current accounting guidance:

Inputs that are quoted prices (unadjusted) in active markets for identical assets or liabilities.

51 unchanged sentences

Fair value at end of period

The amount of total gains or losses for the period included in changes in net assets attributable to the change in

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

The amount of total gains or losses for the period included in changes in net assets attributable to the change in unrealized

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

For the Year Ended December 31, 2019

7 unchanged sentences

Fair value at end of period

The amount of total gains or losses for the period included in changes in net assets attributable to the change in

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

As of June 30, 2018, the Company determined to classify investments whose valuations were obtained from independent third-party pricing

services as Level 2 in the fair value hierarchy as the Company identified significant other observable inputs in these market quotations.

It is the Companys policy to recognize transfers between levels at the beginning of the reporting

The amount of total gains or losses for the period included in changes in net assets attributable to the change in unrealized

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

The valuation techniques and significant unobservable inputs used in recurring Level 3 fair value

measurements as of December 31, 2020 and 2019 were as follows:

Type of Investment

December 31, 2020

Technique (1)

Discounted Cash Flow

Discount Rate

5.7% - 18.6% (9.0%)

EBITDA Multiple

0.1x - 12.7x (7.2x)

Subordinated Debt

Discounted Cash Flow

Discount Rate

12.3% - 12.3% (12.3%)

EBITDA Multiple

7.8x - 11.5x (7.8x)

FS KKR Capital Corp.

3 unchanged sentences

Instruments (continued)

The valuation techniques and significant unobservable inputs used in recurring

Level 3 fair value measurements as of December 31, 2019 and 2018 were as follows:

Type of Investment

Fair Value at

December 31, 2020

Technique (1)

Valuation from

Asset Based Finance

EBITDA Multiple

1.0x - 12.0x (3.6x)

Discounted Cash Flow

Discount Rate

4.2% - 15.2% (9.9%)

EBITDA Multiple

0.1x - 12.5x (7.4x)

Option Pricing Model

Equity Illiquidity Discount

11.0% - 50.0% (11.9%)

Type of Investment

December 31, 2019

Technique (1)

an Increase in

35 unchanged sentences

Fair value based on expected outcome of proposed corporate transactions and/or other factors.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Fair Value of Financial

Instruments (continued)

Type of Investment

Fair Value at

Technique (1)

Senior Secured LoansFirst Lien

Market Comparables

Market Yield (%)

EBITDA Multiples (x)

Revenue Multiples (x)

99.0% - 99.0%

Senior Secured LoansSecond Lien

Market Comparables

Market Yield (%)

EBITDA Multiples (x)

98.5% - 98.5%

Other Senior Secured Debt

Market Comparables

Market Yield (%)

EBITDA Multiples (x)

Subordinated Debt

Market Comparables

Market Yield (%)

EBITDA Multiples (x)

Asset Based Finance

Market Comparables

Market Yield (%)

18.4% - 18.4%

Price to Book Multiple (x)

Net Aircraft Book Value Multiple (x)

Market Quotes

Indicative Dealer Quotes

Discounted Cash Flow

Discount Rate (%)

Net Asset Value

100.0% - 100.0%

Market Comparables

EBITDA Multiples (x)

Revenue Multiples (x)

Capacity Multiple ($/kW)

$1,875.0 - $2,125.0

Net Aircraft Book Value Multiple (x)

Production Multiples (MMcfe/d)

$4,708.0 - $5,167.0

Proved Reserves Multiples (Bcfe)

PV-10 Multiples (x)

Production Multiples (Mboe/d)

$25,000.0 - $38,750.0

Proved Reserves Multiples (Mmboe)

Price to Book Multiple (x)

Discounted Cash Flow

Discount Rate (%)

11.8% - 13.8%

Option Valuation Model

Volatility (%)

30.0% - 30.0%

Equity Illiquidity Discount

10.0% - 10.0%

100.0% - 100.0%

Investments using a market quotes valuation technique were valued by using the midpoint of the prevailing bid and ask prices from dealers on

the date of the relevant period end, which were provided by independent third-party pricing services and screened for validity by such services.

Investments valued using an EBITDA multiple or a revenue multiple pursuant to the market comparables

valuation technique may be conducted using an enterprise valuation waterfall analysis.

For investments utilizing a market comparables valuation technique, a significant increase (decrease) in the market yield, in isolation, would result in a

significantly lower (higher) fair value measurement, and a significant increase (decrease) in any of the valuation multiples, in isolation, would result in a significantly higher (lower) fair value measurement.

For investments utilizing a discounted

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Fair Value of Financial

Instruments (continued)

valuation technique, a significant increase (decrease) in the discount rate, in isolation, would result in a significantly lower (higher) fair value measurement.

For investments utilizing an

option valuation model valuation technique, a significant increase (decrease) in the volatility, in isolation, would result in a significantly higher (lower) fair value measurement.

Fair value based on expected outcome of proposed corporate transactions and/or other factors.

Financing Arrangements

1 unchanged sentence

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

As of December 31, 2019, the aggregate amount outstanding of the senior securities issued

by the Company was $4,195.

As of December 31, 2020, the aggregate amount outstanding of senior securities issued by

the Company was $4,042.

As of December 31, 2020, the Companys asset coverage was 177%.

The following

tables present summary information with respect to the Companys outstanding financing arrangements as of December 31, 2019 and 2018:

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Financing Arrangements (continued)

The following tables present summary information with respect to the Companys

outstanding financing arrangements as of December 31, 2020 and 2019:

As of December 31, 2020

4 unchanged sentences

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

Locust Street Credit Facility (1)

Revolving Credit Facility

September 28, 2022

December 2, 2023

Senior Secured Revolving Credit Facility (2)

Revolving Credit Facility

November 7, 2024

December 23, 2025

4.750% Notes due 2022 (6)

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February 1, 2025

2019-1 Notes (1)(6)

8.625% Notes due 2025 (6)

Unsecured Notes

3.400% Notes due 2026 (6)

Unsecured Notes

January 15, 2026

CLO-1 Notes (2)(7)

Collateralized Loan Obligation

L+1.85% - 3.01% (1)

July 15, 2030

January 15, 2031

LIBOR is subject to a 0% floor.

The carrying amount outstanding under the facility approximates its fair value.

2 unchanged sentences

outstanding indebtedness of the Company.

Amount includes borrowing in Euros, Canadian dollars, pound sterling and Australian dollars.

Amount includes borrowing in Euros, Canadian dollars, pounds sterling and Australian dollars.

Euro balance outstanding of 164 has been

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rate of CAD $1.00 to $0.78 as of December 31, 2020 to reflect total amount outstanding in U.S.

Pound sterling balance outstanding of £100 has been converted to U.S dollars at an exchange rate of £1.00 to $1.33 as of

Pounds sterling balance outstanding of £111 has been converted to U.S dollars at an exchange rate of £1.00 to $1.37 as of

December 31, 2020 to reflect total amount outstanding in U.S.

1 unchanged sentence

outstanding in U.S.

As of December 31, 2019, the fair value of the 4.750% notes, the 5.000% notes, the 4.625% notes and the 4.125% notes was approximately

$467, $250, $416 and $478, respectively.

As of December 31, 2020, the fair value of the 4.750% notes, the 5.000% notes, the 4.625% notes, the 4.125% notes, the 8.625% notes and

the 3.400% notes was approximately $468, $245, $422, $490, $285 and $994 respectively.

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

As of December 31, 2019, 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%.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Financing Arrangements (continued)

As of December 31, 2020, there were $281.4 of Class A-1R notes outstanding at L+1.85%, $20.5 of Class A-2R notes outstanding at

L+2.25%, $32.4 of Class B-1R notes outstanding at L+2.60% and $17.4 of Class B-2R notes outstanding at 3.011%.

As of December 31, 2019

1 unchanged sentence

Maturity Date

CCT New York Funding Credit Facility (1)

Revolving Credit Facility

January 16, 2021

CCT Tokyo Funding Credit Facility (2)

Revolving Credit Facility

December 2, 2022

Locust Street Credit Facility (2)

Term Loan Credit Facility

November 1, 2020

Revolving Credit Facility

September 28, 2022

Senior Secured Revolving Credit Facility (2)

1 unchanged sentence

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

August 9, 2023

November 7, 2024

4.750% Notes due 2022 (6)

Unsecured Notes

July 15, 2019

5.000% Notes due 2022 (6)

Unsecured Notes

January 15, 2020

June 28, 2022

4.625% Notes due 2024 (6)

Unsecured Notes

July 15, 2024

4.125% Notes due 2025 (6)

Unsecured Notes

June 28, 2022

February 1, 2025

CLO-1 Notes (2)(7)

Collateralized Loan Obligation

L+1.70% - 2.50% (1)

July 15, 2030

LIBOR is subject to a 0% floor.

The carrying amount outstanding under the facility approximates its fair value.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Financing Arrangements (continued)

The spread over LIBOR is determined by reference to the amount outstanding under the facility.

1 unchanged sentence

outstanding indebtedness of the Company.

Amount includes borrowing in Euros, Canadian dollars and pound sterling.

Euro balance outstanding of 25 has been converted to U.S.

Amount includes borrowing in Euros, Canadian dollars, pounds sterling and Australian dollars.

Euro balance outstanding of 291 has been

converted to U.S.

dollars at an exchange rate of 1.00 to $1.12 as of December 31, 2019 to reflect total amount outstanding in U.S.

Canadian dollar balance outstanding of CAD $24 has been converted to U.S dollars at an exchange rate of CAD $1.00 to

$0.73 as of December 31, 2018 to reflect total amount outstanding in U.S.

Pound sterling balance outstanding of £3 has been converted to U.S dollars at an exchange rate of £1.00 to $1.28 as of December 31, 2018 to

reflect total amount outstanding in U.S.

Canadian dollar balance outstanding of CAD $69 has been converted to U.S dollars at an exchange

rate of CAD $1.00 to $0.77 as of December 31, 2019 to reflect total amount outstanding in U.S.

Pounds sterling balance outstanding of £100 has been converted to U.S dollars at an exchange rate of £1.00 to $1.33 as of

December 31, 2019 to reflect total amount outstanding in U.S.

Australian dollar balance outstanding of A$173 has been converted to U.S dollars at an exchange rate of A$1.00 to $0.70 as of December 31, 2019 to reflect total amount

outstanding in U.S.

As of December 31, 2019, the fair value of the 4.750% notes, the 5.000% notes, the 4.625% notes and the 4.125% notes was approximately

1 unchanged sentence

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

For the years ended December 31, 2019, 2018 and 2017, the components of total interest expense for the Companys financing arrangements were as follows:

As of December 31, 2019, 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%.

For the years

ended December 31, 2020, 2019 and 2018, the components of total interest expense for the Companys financing arrangements were as follows:

Year Ended December 31,

12 unchanged sentences

4.125% Notes due 2025

Partial Loan Sale (3)

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Financing Arrangements (continued)

8.625% Notes due 2025

3.400% Notes due 2026

Borrowings of each of the Companys wholly-owned, special-purpose financing subsidiaries are considered borrowings of the Company for

1 unchanged sentence

Direct interest expense includes the effect of non-usage fees.

Total interest expense for the secured borrowing includes the effect of amortization of discount.

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

6 unchanged sentences

effect of non-usage fees, was 4.01%.

Under its financing

arrangements, the Company has made certain representations and warranties and is required to comply with various covenants, reporting requirements and other customary requirements for similar financing arrangements.

The Company was in compliance

with all covenants required by its financing arrangements as of December 31, 2019 and December 31, 2018.

CCT New York Funding

Credit Facility

On November 29, 2016, CCT New York Funding LLC, or CCT New York Funding, a wholly owned special

purpose financing subsidiary of the Company, entered into a revolving credit facility, or the CCT New York Funding Credit Facility, pursuant to a loan and security agreement, or the CCT New York Funding Loan Agreement, with JPMorgan Chase Bank,

National Association, or JPMorgan, as administrative agent and lender, any additional lenders from time to time party thereto, the collateral administrator, collateral agent and securities intermediary party thereto, and the Company, which succeeded

CCT as the portfolio manager.

The CCT New York Funding Credit Facility provided for borrowings in an aggregate principal

amount up to $300.

In connection with amending and restating the Locust Street Loan Agreement, the Company repaid and

terminated the CCT New York Funding Credit Facility.

CCT Tokyo Funding Credit Facility

On December 2, 2015, CCT Tokyo Funding LLC, or CCT Tokyo Funding, a wholly owned special purpose financing subsidiary of the Company,

entered into a revolving credit facility, or the CCT Tokyo Funding Credit Facility, pursuant to a loan and servicing agreement with Sumitomo Mitsui Banking Corporation, or SMBC, as the administrative agent, collateral agent, and lender, and the

Company, which succeeded CCT as the servicer and transferor.

The CCT Tokyo Funding Credit Facility provides for borrowings in

an aggregate principal amount up to $300.

The end of the reinvestment period and the maturity date for the CCT Tokyo Funding Credit Facility are June 2, 2020 and June 2, 2023, respectively.

CCT Tokyo Funding may elect to extend both

the reinvestment period and maturity date by an additional six months to December 2, 2020 and December 2, 2023, respectively, subject to satisfaction of certain conditions.

Advances under the CCT Tokyo Funding Credit Facility are subject

to a borrowing base test.

Advances outstanding under the CCT Tokyo Funding Credit Facility bear interest at a rate equal to

(i) for loans for which CCT Tokyo Funding elects the base rate option, the higher of (A) the Prime Rate (as defined in the CCT Tokyo Funding loan and servicing agreement) or (B) the federal funds effective rate plus 0.50%,

plus a spread of 0.75% per annum, or (ii) for loans for which CCT Tokyo Funding elects the LIBOR rate option, three-month LIBOR plus a spread of 1.75% per annum.

In each case, the spread increases by 0.25% per annum if the average daily amount

of advances outstanding during the relevant

FS KKR Capital Corp.

2 unchanged sentences

Financing Arrangements (continued)

remittance period does not exceed $150.

Effective June 2, 2016, CCT Tokyo Funding began paying a quarterly non-usage fee of 0.35% per annum on any

unborrowed amounts up to a threshold amount equal to the lesser of (i) 50% of the borrowing base during the relevant remittance period and (ii) $150, and 0.875% per annum on any unborrowed amounts above such threshold amount.

Under its financing arrangements, the Company has made certain representations and

warranties and is required to comply with various covenants, reporting requirements and other customary requirements for similar financing arrangements.

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

December 31, 2020 and December 31, 2019.

CCT New York Funding Credit Facility

On November 29, 2016, CCT New York Funding LLC, or CCT New York Funding, a wholly owned special purpose financing subsidiary of the

Company, entered into a revolving credit facility, or the CCT New York Funding Credit Facility, pursuant to a loan and security agreement, or the CCT New York Funding Loan Agreement, with JPMorgan Chase Bank, National Association, or JPMorgan, as

administrative agent and lender, any additional lenders from time to time party thereto, the collateral administrator, collateral agent and securities intermediary party thereto, and the Company, which succeeded CCT as the portfolio manager.

The CCT New York Funding Credit Facility provided for borrowings in an aggregate principal amount up to $300.

In connection with amending and restating the Locust Street Loan Agreement, the Company repaid and terminated the CCT New York Funding

Credit Facility.

CCT Tokyo Funding Credit Facility

On December 2, 2015, CCT Tokyo Funding LLC, or CCT Tokyo Funding, a wholly owned special purpose financing subsidiary of the Company, entered into a revolving credit facility, or as amended the CCT

Tokyo Funding Credit Facility, pursuant to a loan and servicing agreement with Sumitomo Mitsui Banking Corporation, or SMBC, as the administrative agent, collateral agent, and lender, and the Company, which succeeded CCT as the servicer and

The CCT Tokyo Funding Credit Facility provides for borrowings in an aggregate principal amount up to $300.

The end of the reinvestment period and the maturity date for the CCT Tokyo Funding Credit Facility are June 2, 2021 and December 2, 2023, respectively.

CCT Tokyo Funding may elect to extend both the reinvestment period and maturity date by

an additional six months to December 2, 2021 and June 2, 2024, respectively, subject to satisfaction of certain conditions.

Advances under the CCT Tokyo Funding Credit Facility are subject to a borrowing base test.

Advances outstanding under the CCT Tokyo Funding Credit Facility bear interest at a rate equal to (i) for loans for which CCT Tokyo

Funding elects the base rate option, the higher of (A) the Prime Rate (as defined in the CCT Tokyo Funding loan and servicing agreement) or (B) the federal funds effective rate plus 0.50%, plus a spread of 0.75% per annum, or

(ii) for loans for which CCT Tokyo Funding elects the LIBOR rate option, three-month LIBOR plus a spread of 1.75% per annum.

In each case, the spread increases by 0.25% per annum if the average daily amount of advances outstanding during the

relevant remittance period does not exceed $150.

Effective June 2, 2016, CCT Tokyo Funding began paying a quarterly non-usage fee of 0.35% per annum on any unborrowed amounts up to a threshold amount

equal to the lesser of (i) 50% of the borrowing base during the relevant remittance period and (ii) $150, and 0.875% per annum on any unborrowed amounts above such threshold amount.

In connection with the CCT Tokyo Funding Credit Facility, CCT Tokyo Funding has made certain representations and warranties and is

5 unchanged sentences

The obligations of CCT Tokyo Funding under the CCT Tokyo Credit Facility are non-recourse to the Company.

Locust Street Credit Facility

On November 1, 2016, Locust Street Street Funding, LLC, or Locust Street, a wholly owned special purpose financing subsidiary of the Company, entered into a loan agreement, or the Locust Street Loan

Agreement and, together with the related transaction documents as subsequently amended and restated, the Locust Street Credit Facility, with JPMorgan, as lender and administrative agent, Citibank, N.A., as collateral agent and securities

intermediary, and Virtus Group, LP, as collateral administrator, pursuant to which JPMorgan advanced a $625 term loan to Locust Street.

Borrowings outstanding under the Locust Street Credit Facility previously beared interest at a rate equal to

three-month LIBOR plus a spread of 2.6833% per annum.

Interest was payable quarterly in arrears.

Under the Locust Street Loan Agreement, Locust Street agreed to repay $200 of the aggregate principal amount of the advances on or before

January 31, 2017, which repayment was satisfied in full in December 2016.

All remaining outstanding advances under the Locust Street Loan Agreement were scheduled to mature, and all accrued and unpaid interest thereunder, was due and

payable, on November 1, 2020.

On March 4, 2019, CCT New York Funding merged with and into Locust Street, and

concurrently, Locust Street entered into an Amended and Restated Loan and Security Agreement, or the Locust Street Amended and Restated Loan Agreement, with JPMorgan, as administrative agent, each of the lenders party thereto, and Wells Fargo Bank,

National Association, as collateral agent, securities intermediary, and collateral administrator, amending and restating the Locust Street Loan Agreement.

Locust Street used a portion of the proceeds of additional borrowings under the Locust Street

Amended and Restated Loan Agreement to repay and terminate the CCT New York Funding Credit Facility.

The Locust Street Credit

Facility provides for revolving borrowings in U.S.

dollars and certain agreed upon foreign currencies in an aggregate principal amount up to $400.

The end of the reinvestment period and the maturity date for the Locust Street Credit Facility are

September 28, 2021 and September 28, 2022, respectively.

Borrowings under the Locust Street Credit Facility are subject to a borrowing base test.

Under the Locust Street Credit Facility, U.S.

dollar borrowings bear interest at the rate of three-month LIBOR plus 2.50%.

Foreign currency borrowings bear interest at the applicable floating rate plus

Interest is payable quarterly in arrears.

During the reinvestment period, Locust Street will pay unused fees quarterly in arrears in an amount equal to the sum of (1) the average daily unused commitment up to 80% of the maximum facility

amount charged at the interest rate that would have accrued during that quarter if that unused commitment had been borrowed in U.S.

Dollars plus (2) 0.75% per annum of the average daily unused commitment above 80% of the maximum facility amount.

In connection with the Locust Street Credit Facility, Locust Street has made certain representations and warranties and must

comply with various covenants and reporting requirements customary for facilities of this type.

The Locust Street Credit Facility contains events of default customary for similar financing transactions.

Upon the occurrence and during the

continuation of an event of default, JPMorgan may declare the outstanding borrowings and all other obligations under the Locust Street Credit Facility immediately due and payable.

FS KKR Capital Corp.

2 unchanged sentences

Financing Arrangements (continued)

Locust Streets obligations under the Locust Street Credit Facility are secured by

a first priority security interest in substantially all of the assets of Locust Street, including its portfolio of assets.

The obligations of Locust Street under the Locust Street Credit Facility are

non-recourse to the Company, and the Companys exposure under the Locust Street Credit Facility is limited to the value of the Companys investment in Locust Street.

The Company incurred costs in connection with obtaining and amending the Locust Street Credit Facility, which the Company has recorded as

deferred financing costs on its consolidated balance sheets and amortizes to interest expense over the life of the facility.

As of December 31, 2019, $3 of such deferred financing costs had yet to be amortized to interest expense.

Senior Secured Revolving Credit Facility

On August 9, 2018, the Company entered into a senior secured revolving credit facility, or as subsequently amended and restated the Senior Secured Revolving Credit Facility, with FS KKR Capital Corp.

II (formerly known as FS Investment Corporation II, as a borrower in its own right and as successor by merger to FS Investment Corporation III), or FSK II, (and prior to the Merger, CCT), as borrowers, JPMorgan, as administrative agent, ING Capital

LLC, or ING, as collateral agent and the lenders party thereto.

The Senior Secured Revolving Credit Facility provides for

borrowings in U.S.

dollars and certain agreed upon foreign currencies in an initial aggregate amount of up to $3,890 with an option for the Company to request, at one or more times, that existing and/or new lenders, at their election, provide up to

$1,945 of additional commitments.

The Senior Secured Revolving Credit Facility initially provides for a sublimit available for the Company to borrow up to $2,215 of the total facility amount, subject to increase or reduction from time to time

pursuant to the terms of the Senior Secured Revolving Credit Facility and the oversight and approval of the Companys board of directors.

A sublimit of the total facility amount also is available to FSK II as an additional borrower, and the

obligations of the borrowers under the Senior Secured Revolving Credit Facility are several (and not joint) in all respects.

The Senior Secured Revolving Credit Facility provides for the issuance of letters of credit in an initial aggregate face

amount of up to $400, with a sublimit available for the Company to request the issuance of letters of credit in an aggregate face amount of up to $99.6, subject to increase or reduction from time to time pursuant to the terms of the Senior Secured

Revolving Credit Facility.

Availability under the Senior Secured Revolving Credit Facility will terminate on November 7,

2023, or the Revolver Termination Date, and the outstanding loans under the Senior Secured Revolving Credit Facility will mature on November 7, 2024.

The Senior Secured Revolving Credit Facility also requires mandatory prepayment of interest

and principal upon certain events during the term-out period commencing on the Revolver Termination Date and at certain other times when the Companys adjusted asset coverage ratio is less than

Borrowings under the Senior Secured Revolving Credit Facility are subject to compliance with a borrowing base test.

Interest under the Senior Secured Revolving Credit Facility for (i) loans for which the Company elects the base rate option, (A) if the value of the borrowing base is equal to or greater than 1.85 times the aggregate amount of certain

outstanding indebtedness of the Company, or the Combined Debt Amount, is payable at an alternate base rate (which is the greatest of (a) the prime rate as publicly announced by JPMorgan, (b) the sum of (x) the greater of

(I) the federal funds effective rate and (II) the overnight bank funding rate plus (y) 0.5%, and (c) the one month LIBOR plus 1% per annum) plus 0.75% and, (B) if the value of the borrowing base is less than 1.85 times the

Combined Debt Amount, the alternate base rate plus 1.00%;

and (ii) loans for which the Company elects the Eurocurrency option (A) if the value of the borrowing base is equal to or greater than 1.85 times the Combined Debt Amount, is

payable at a rate equal to LIBOR plus 1.75% and (B) if the value of the borrowing base is less than 1.85 times the Combined Debt Amount, is payable at a rate equal to LIBOR plus 2.00%.

The Company will pay a commitment fee of at least 0.375%

and up to 0.50% per annum (based on the immediately preceding quarters average usage) on the unused portion of its sublimit under the Senior Secured Revolving Credit Facility during the revolving period.

The Company also will be required to

pay letter of credit participation fees and a fronting fee on the average daily amount of any lenders exposure with respect to any letters of credit issued at the request of the Company under the Senior Secured Revolving Credit Facility.

FS KKR Capital Corp.

Notes to Consolidated Financial Statements (continued)

(in millions, except share and per share amounts)

Financing Arrangements (continued)

In connection with the Senior Secured Revolving Credit Facility, the Company has made

certain representations and warranties and must comply with various covenants and reporting requirements customary for facilities of this type.

In addition, the Company must comply with the following financial covenants:

(a) the Company must

Locust Street Credit Facility

On November 1, 2016, Locust Street Funding, LLC, or Locust Street, a wholly owned special purpose financing subsidiary of the

Company, entered into a loan agreement, or the Locust Street Loan Agreement and, together with the related transaction documents as subsequently amended and restated, the Locust Street Credit Facility, with JPMorgan, as lender and administrative

agent, Citibank, N.A., as collateral agent and securities intermediary, and Virtus Group, LP, as collateral administrator, pursuant to which JPMorgan advanced a $625 term loan to Locust Street.

Borrowings outstanding under the Locust Street Credit

Facility equally beared interest at a rate equal to three-month LIBOR plus a spread of 2.6833% per annum.

Interest was payable quarterly in arrears.

Under the Locust Street Loan Agreement, Locust Street agreed to repay $200 of the aggregate

principal amount of the advances on or before January 31, 2017, which repayment was satisfied in full in December 2016.

All remaining outstanding advances under the Locust Street Loan Agreement were scheduled to mature, and all accrued

and unpaid interest thereunder, was due and payable, on November 1, 2020.

On March 4, 2019, CCT New York Funding

merged with and into Locust Street, and concurrently, Locust Street entered into an Amended and Restated Loan and Security Agreement, or the Locust Street Amended and Restated Loan Agreement, with JPMorgan, as administrative agent, each of the

lenders party thereto, and Wells Fargo Bank, National Association, as collateral agent, securities intermediary, and collateral administrator, amending and restating the Locust Street Loan Agreement.

Locust Street used a portion of the proceeds of

additional borrowings under the Locust Street Amended and Restated Loan Agreement to repay and terminate the CCT New York Funding Credit Facility.

The Locust Street Credit Facility provided for revolving borrowings in U.S.

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-K

Item 8. Financial Statements and Supplementary Data