Oaktree Specialty Lending Corp 10-K

Item 7A. Quantitative and Qualitative Disclosures about Market Risk We are subject to financial market risks, including changes in the valuations of our investment portfolio and interest rates. Valuation Risk Our investments may not have a readily available market price, and we value these investments at fair value as determined in good faith by our Board of Directors, with the assistance of the Audit Committee and Oaktree. There is no single standard for determining fair value in good faith and valuation methodologies involve a significant degree of management judgment. In addition, our valuation methodology utilizes discount rates in part in valuing our investments, and changes in those discount rates may have an impact on the valuation of our investments. Accordingly, valuations by us do not necessarily represent the amounts which may eventually be realized from sales or other dispositions of investments. Estimated fair values may differ from the values that would have been used had a ready market for the investment existed, and the differences could be material to the financial statements. Interest Rate Risk We are subject to financial market risks, including changes in interest rates. Changes in interest rates may affect both our cost of funding and our interest income from portfolio investments, cash and cash equivalents and idle fund investments. Our risk management procedures are designed to identify and analyze our risk, to set appropriate policies and to continually monitor these risks. Our investment income will be affected by changes in various interest rates, including LIBOR and prime rates, to the extent our debt investments include floating interest rates. As of September 30, 2021, 91.5% of our debt investment portfolio (at fair value) and 91.8% of our debt investment portfolio (at cost) bore interest at floating rates. As of September 30, 2020, 88.3% of our debt investment portfolio (at fair value) and 88.8% of our debt investment portfolio (at cost) bore interest at floating rates. The composition of our floating rate debt investments by interest rate floor as of September 30, 2021 and September 30, 2020, was as follows: September 30, 2021 September 30, 2020 ($ in thousands) Fair Value % of Floating Rate Portfolio Fair Value % of Floating Rate Portfolio 0% $ 322,222 14.6 % $ 553,829 42.2 % >0% and <1% 283,065 12.8 % 39,789 3.0 % 1% 1,507,977 68.4 % 672,529 51.3 % >1% 92,384 4.2 % 45,362 3.5 % Total Floating Rate Investments $ 2,205,648 100.0 % $ 1,311,509 100.0 % Based on our Consolidated Statement of Assets and Liabilities as of September 30, 2021, the following table shows the approximate annualized net increase (decrease) in net assets resulting from operations of hypothetical base rate changes in interest rates, assuming no changes in our investment and capital structure. However, there can be no assurances our portfolio companies will be able to meet their contractual obligations at any or all levels on increases in interest rates. ($ in thousands) Basis point increase Increase in Interest Income (Increase) in Interest Expense Net increase (decrease) in net assets resulting from operations 250 $ 38,500 $ (24,500) $ 14,000 200 27,660 (19,600) 8,060 150 16,905 (14,700) 2,205 100 6,338 (9,800) (3,462) 50 1,744 (4,900) (3,156) The net effect of any decrease in interest rates is limited and would not be of significance due to interest rate floors on investments and borrowings outstanding. 74 We regularly measure exposure to interest rate risk. We assess interest rate risk and manage our interest rate exposure on an ongoing basis by comparing our interest rate sensitive assets to our interest rate sensitive liabilities. Based on this review, we determine whether or not any hedging transactions are necessary to mitigate exposure to changes in interest rates. The following table shows a comparison of the interest rate base for our interest-bearing cash and outstanding investments, at principal, and our outstanding borrowings as of September 30, 2021 and September 30, 2020: September 30, 2021 September 30, 2020 ($ in thousands) Interest Bearing Cash and Investments Borrowings Interest Bearing Cash and Investments Borrowings Money market rate $ 23,600 $ — $ 35,248 $ — Prime rate 305 10,000 305 — LIBOR 30 day 674,613 485,000 717,576 414,825 60 day — — 6,861 — 90 day (a) 1,037,019 485,000 362,141 — 180 day 323,869 — 201,699 — 360 day 96,095 — 23,351 — EURIBOR 30 day 28,786 — 29,126 — 90 day 19,599 — — — 180 day 18,516 — 1,689 — UK LIBOR 30 day 28,991 — 23,270 — 180 day 25,128 — 14,612 — Fixed rate 200,599 300,000 171,976 300,000 Total $ 2,477,120 $ 1,280,000 $ 1,587,854 $ 714,825 __________ (a) Borrowings include the 2027 Notes, which pay interest at a floating rate under the terms of the interest rate swap. 75 Item 8. Consolidated Financial Statements. Index to Consolidated Financial Statements Reports of Independent Registered Public Accounting Firm 77 Consolidated Statements of Assets and Liabilities as of September 30, 2021 and 2020 80 Consolidated Statements of Operations for the Years Ended September 30, 2021, 2020 and 2019 81 Consolidated Statements of Changes in Net Assets for the Years Ended September 30, 2021, 2020 and 2019 82 Consolidated Statements of Cash Flows for the Years Ended September 30, 2021, 2020 and 2019 83 Consolidated Schedule of Investments as of September 30, 2021 84 Consolidated Schedule of Investments as of September 30, 2020 96 Notes to Consolidated Financial Statements 107 76 Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Oaktree Specialty Lending Corporation Opinion on the Financial Statements We have audited the accompanying consolidated statements of assets and liabilities of Oaktree Specialty Lending Corporation (the Company), including the consolidated schedules of investments, as of September 30, 2021 and 2020, the related consolidated statements of operations, changes in net assets, and cash flows for each of the three years in the period ended September 30, 2021, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at September 30, 2021 and 2020, and the results of its operations, changes in its net assets, and its cash flows for each of the three years in the period ended September 30, 2021, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of September 30, 2021, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated November 15, 2021 expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. 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 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 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. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our procedures included confirmation of investments owned as of September 30, 2021 and 2020 by correspondence with the custodians, syndication agents and underlying investee companies, and by other appropriate auditing procedures where confirmation was not received. 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. 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 the critical audit matter does not alter in any way our opinion on the consolidated 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 account or disclosures to which it relates. 77 Valuation of investments using significant unobservable inputs Description of the Matter As described in Note 3 to the consolidated financial statements, the Company classified $2,161,581 thousand of its investments as Level 3 within the fair value hierarchy (Level 3 investments) as of September 30, 2021. As described in Note 2 and Note 3 to the consolidated financial statements, the Company’s Board of Directors determined the fair value of the Company’s Level 3 investments by using valuation techniques such as broker quotations, precedent transactions, enterprise value analyses or market yield techniques. These techniques require management to make judgments about the significant unobservable inputs including, among others, comparable EBITDA, revenue or asset multiples, market yields and broker quoted prices. Auditing the fair value of the Company’s Level 3 investments involved a high degree of auditor judgment and extensive audit effort, as changes in the valuation techniques or significant unobservable inputs could have resulted in significant changes in fair value measurements. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls related to the Company’s investment valuation process, including controls related to the Company’s assessment of valuation techniques and significant unobservable inputs used in determining the fair value measurements of the Level 3 investments. Our audit procedures included, among others, evaluating the Company’s valuation techniques and significant unobservable inputs used. Our audit procedures also included, for a sample of Level 3 investments, validating the mathematical accuracy of the fair value calculations and validating the accuracy of other relevant inputs used in estimating fair value measurement, such as investment terms and portfolio company financial information. For example, we compared publicly available information in the Company’s valuation models (e.g., market yields, EBITDA, revenue, and asset multiples of comparable public companies and comparable public transactions) to information available from third-party market research providers. We also compared the significant company-specific inputs in the Company’s valuation models to source documents, such as portfolio company financial statements and covenant certificates provided by the Company. To evaluate the reasonableness of significant unobservable inputs, we assessed whether these inputs were developed in a manner consistent with the Company’s valuation policies and in some instances, we involved our valuation specialists to independently develop ranges using portfolio company and available market information to estimate the fair value of selected investments and we compared these ranges to the Company’s fair value measurements. We also evaluated subsequent events and transactions and considered whether they corroborated or contradicted the Company’s fair value measurements. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2018. Los Angeles, CA November 15, 2021 78 Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of Oaktree Specialty Lending Corporation Opinion on Internal Control Over Financial Reporting We have audited Oaktree Specialty Lending Corporation’s internal control over financial reporting as of September 30, 2021, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Oaktree Specialty Lending Corporation (the Company) maintained, in all material respects, effective internal control over financial reporting as of September 30, 2021, based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of assets and liabilities of the Company, including the consolidated schedules of investments, as of September 30, 2021 and 2020, the related consolidated statements of operations, changes in net assets and cash flows for each of the three years in the period ended September 30, 2021, and the related notes and our report dated November 15, 2021 expressed an unqualified opinion thereon. Basis for Opinion The Company’s 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 Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s 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. Definition and Limitations of Internal Control Over Financial Reporting A company’s 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 company’s 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 company’s 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. /s/ Ernst & Young LLP Los Angeles, California November 15, 2021 79 Oaktree Specialty Lending Corporation Consolidated Statements of Assets and Liabilities (in thousands, except per share amounts) September 30, 2021 September 30, 2020 ASSETS Investments at fair value: Control investments (cost September 30, 2021: $283,599; cost September 30, 2020: $245,950) $ 270,765 $ 201,385 Affiliate investments (cost September 30, 2021: $18,763; cost September 30, 2020: $7,551) 18,289 6,509 Non-control/Non-affiliate investments (cost September 30, 2021: $2,236,759; cost September 30, 2020: $1,415,669) 2,267,575 1,365,957 Total investments at fair value (cost September 30, 2021: $2,539,121; cost September 30, 2020: $1,669,170) 2,556,629 1,573,851 Cash and cash equivalents 29,334 39,096 Restricted cash 2,301 — Interest, dividends and fees receivable 22,125 6,935 Due from portfolio companies 1,990 2,725 Receivables from unsettled transactions 8,150 9,123 Due from broker 1,640 — Deferred financing costs 9,274 5,947 Deferred offering costs 34 67 Deferred tax asset, net 714 847 Derivative assets at fair value 1,912 223 Other assets 2,284 1,898 Total assets $ 2,636,387 $ 1,640,712 LIABILITIES AND NET ASSETS Liabilities: Accounts payable, accrued expenses and other liabilities $ 3,024 $ 1,072 Base management fee and incentive fee payable 32,649 11,212 Due to affiliate 4,357 2,130 Interest payable 4,597 1,626 Payables from unsettled transactions 8,086 478 Derivative liability at fair value 2,108 — Credit facilities payable 630,000 414,825 Unsecured notes payable (net of $6,501 and $3,272 of unamortized financing costs as of September 30, 2021 and September 30, 2020, respectively) 638,743 294,490 Total liabilities 1,323,564 725,833 Commitments and contingencies (Note 14) Net assets: Common stock, $0.01 par value per share, 250,000 shares authorized; 180,361 and 140,961 shares issued and outstanding as of September 30, 2021 and September 30, 2020, respectively 1,804 1,409 Additional paid-in-capital 1,804,354 1,487,774 Accumulated overdistributed earnings (493,335) (574,304) Total net assets (equivalent to $7.28 and $6.49 per common share as of September 30, 2021 and September 30, 2020, respectively) (Note 12) 1,312,823 914,879 Total liabilities and net assets $ 2,636,387 $ 1,640,712 See notes to Consolidated Financial Statements. 80 Oaktree Specialty Lending Corporation Consolidated Statements of Operations (in thousands, except per share amounts) Year ended September 30, 2021 Year ended September 30, 2020 Year ended September 30, 2019 Interest income: Control investments $ 11,792 $ 9,832 $ 11,886 Affiliate investments 716 467 206 Non-control/Non-affiliate investments 161,864 114,947 120,888 Interest on cash and cash equivalents 9 322 690 Total interest income 174,381 125,568 133,670 PIK interest income: Control investments — — 67 Non-control/Non-affiliate investments 16,447 7,863 5,430 Total PIK interest income 16,447 7,863 5,497 Fee income: Control investments 59 42 25 Affiliate investments 20 20 19 Non-control/Non-affiliate investments 14,019 8,457 6,666 Total fee income 14,098 8,519 6,710 Dividend income: Control investments 4,459 1,180 1,825 Non-control/Non-affiliate investments — 3 — Total dividend income 4,459 1,183 1,825 Total investment income 209,385 143,133 147,702 Expenses: Base management fee 32,288 22,895 22,343 Part I incentive fee 21,598 15,194 14,873 Part II incentive fee 17,615 (5,557) 10,194 Professional fees 4,231 2,532 2,906 Directors fees 607 570 570 Interest expense 30,518 26,289 32,426 Administrator expense 1,510 1,524 1,941 General and administrative expenses 2,725 2,494 2,530 Total expenses 111,092 65,941 87,783 Reversal of fees waived (fees waived) (1,608) 5,200 (7,990) Net expenses 109,484 71,141 79,793 Net investment income before taxes 99,901 71,992 67,909 (Provision) benefit for taxes on net investment income (2,795) — — Net investment income 97,106 71,992 67,909 Unrealized appreciation (depreciation): Control investments 31,731 (29,488) 1,519 Affiliate investments 568 (1,763) (360) Non-control/Non-affiliate investments 80,531 10,904 39,689 Secured borrowings — — (2,719) Foreign currency forward contracts 1,689 (267) 328 Net unrealized appreciation (depreciation) 114,519 (20,614) 38,457 Realized gains (losses): Control investments — (4,155) — Non-control/Non-affiliate investments 27,094 (4,615) 15,300 Extinguishment of unsecured notes payable — (2,541) — Secured borrowings — — 2,625 Foreign currency forward contracts (674) (2,613) 2,880 Net realized gains (losses) 26,420 (13,924) 20,805 (Provision) benefit for taxes on realized and unrealized gains (losses) (785) 1,770 (1,011) Net realized and unrealized gains (losses), net of taxes 140,154 (32,768) 58,251 Net increase (decrease) in net assets resulting from operations $ 237,260 $ 39,224 $ 126,160 Net investment income per common share — basic and diluted $ 0.60 $ 0.51 $ 0.48 Earnings (loss) per common share — basic and diluted (Note 5) $ 1.46 $ 0.28 $ 0.89 Weighted average common shares outstanding — basic and diluted 162,118 140,961 140,961 See notes to Consolidated Financial Statements. 81 Oaktree Specialty Lending Corporation Consolidated Statements of Changes in Net Assets (in thousands, except per share amounts) (unaudited) Year ended September 30, 2021 Year ended September 30, 2020 Year ended September 30, 2019 Operations: Net investment income $ 97,106 $ 71,992 $ 67,909 Net unrealized appreciation (depreciation) 114,519 (20,614) 38,457 Net realized gains (losses) 26,420 (13,924) 20,805 (Provision) benefit for taxes on realized and unrealized gains (losses) (785) 1,770 (1,011) Net increase (decrease) in net assets resulting from operations 237,260 39,224 126,160 Stockholder transactions: Distributions to stockholders (82,020) (54,975) (53,565) Net increase (decrease) in net assets from stockholder transactions (82,020) (54,975) (53,565) Capital share transactions: Issuance of common stock in connection with the Mergers 242,704 — — Issuance of common stock under dividend reinvestment plan 2,170 1,878 1,344 Repurchases of common stock under dividend reinvestment plan (2,170) (1,878) (1,344) Net increase (decrease) in net assets from capital share transactions 242,704 — — Total increase (decrease) in net assets 397,944 (15,751) 72,595 Net assets at beginning of period 914,879 930,630 858,035 Net assets at end of period $ 1,312,823 $ 914,879 $ 930,630 Net asset value per common share $ 7.28 $ 6.49 $ 6.60 Common shares outstanding at end of period 180,361 140,961 140,961 See notes to Consolidated Financial Statements. 82 Oaktree Specialty Lending Corporation Consolidated Statements of Cash Flows (in thousands) Year ended September 30, 2021 Year ended September 30, 2020 Year ended September 30, 2019 Operating activities: Net increase (decrease) in net assets resulting from operations $ 237,260 $ 39,224 $ 126,160 Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities: Net unrealized (appreciation) depreciation (114,519) 20,614 (38,457) Net realized (gains) losses (26,420) 13,924 (20,805) PIK interest income (16,447) (7,863) (5,497) Accretion of original issue discount on investments (29,391) (12,305) (17,982) Accretion of original issue discount on unsecured notes payable 572 302 107 Amortization of deferred financing costs 4,151 2,187 2,471 Deferred taxes 133 (1,551) 282 Purchases of investments (1,120,168) (727,161) (477,967) Proceeds from the sales and repayments of investments 792,161 579,550 606,270 Cash acquired in the Mergers 20,945 — — Changes in operating assets and liabilities: (Increase) decrease in interest, dividends and fees receivable (8,495) 4,232 (895) (Increase) decrease in due from portfolio companies 1,360 (109) (1,259) (Increase) decrease in receivables from unsettled transactions 2,514 (4,537) 22,174 (Increase) decrease in due from broker (1,640) — — (Increase) decrease in other assets (1,427) 437 673 Increase (decrease) in accounts payable, accrued expenses and other liabilities (426) (517) (1,992) Increase (decrease) in base management fee and incentive fee payable 19,516 1,045 1,944 Increase (decrease) in due to affiliate 1,119 (559) (585) Increase (decrease) in interest payable 1,163 (670) (1,069) Increase (decrease) in payables from unsettled transactions 7,608 (59,118) 22,360 Increase (decrease) in director fees payable (90) — — Increase (decrease) in amounts payable to syndication partners — — (109) Net cash provided by (used in) operating activities (230,521) (152,875) 215,824 Financing activities: Distributions paid in cash (79,850) (53,097) (52,221) Borrowings under credit facilities 505,000 286,000 298,825 Repayments of borrowings under credit facilities (529,582) (186,000) (225,000) Repayments of unsecured notes — (161,250) (228,825) Issuance of unsecured notes 349,020 297,459 — Repayments of secured borrowings (9,341) — (2,659) Repurchases of common stock under dividend reinvestment plan (2,170) (1,878) (1,344) Deferred financing costs paid (8,890) (4,835) (2,883) Deferred offering costs paid — (67) — Net cash provided by (used in) financing activities 224,187 176,332 (214,107) Effect of exchange rate changes on foreign currency (1,127) 233 200 Net increase (decrease) in cash and cash equivalents and restricted cash (7,461) 23,690 1,917 Cash and cash equivalents and restricted cash, beginning of period 39,096 15,406 13,489 Cash and cash equivalents and restricted cash, end of period $ 31,635 $ 39,096 $ 15,406 Supplemental information: Cash paid for interest $ 24,006 $ 24,470 $ 31,025 Non-cash financing activities: Issuance of shares of common stock under dividend reinvestment plan $ 2,170 $ 1,878 $ 1,344 Deferred financing costs (162) — — Issuance of shares in connection with the Mergers 242,704 — — Extinguishment of secured borrowings — — (7,163) Reconciliation to the Consolidated Statements of Assets and Liabilities September 30, 2021 September 30, 2020 September 30, 2019 Cash and cash equivalents $ 29,334 $ 39,096 $ 15,406 Restricted cash 2,301 — — Total cash and cash equivalents and restricted cash $ 31,635 $ 39,096 $ 15,406 See notes to Consolidated Financial Statements. 83 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Control Investments (8)(9) C5 Technology Holdings, LLC Data Processing & Outsourced Services 829 Common Units $ — $ — (15) 34,984,460.37 Preferred Units 34,984 27,638 (15) 34,984 27,638 Dominion Diagnostics, LLC Health Care Services First Lien Term Loan, LIBOR+5.00% cash due 2/28/2024 6.00 % $ 27,381 27,381 27,381 (6)(15) First Lien Revolver, LIBOR+5.00% cash due 2/28/2024 — — — (6)(15)(19) 30,030.8 Common Units in DD Healthcare Services Holdings, LLC 18,625 18,065 (12)(15) 46,006 45,446 First Star Speir Aviation Limited Airlines (10) First Lien Term Loan, 9.00% cash due 12/15/2025 7,500 — 7,500 (11)(15) 100% equity interest 6,332 698 (11)(12)(15) 6,332 8,198 OCSI Glick JV LLC Multi-Sector Holdings (14) Subordinated Debt, LIBOR+4.50% cash due 10/20/2028 4.60 % 61,709 50,705 55,582 (6)(11)(15)(19) 87.5% equity interest — — (11)(16)(19) 50,705 55,582 Senior Loan Fund JV I, LLC Multi-Sector Holdings (14) Subordinated Debt, LIBOR+7.00% cash due 12/29/2028 8.00 % 96,250 96,250 96,250 (6)(11)(15)(19) 87.5% LLC equity interest 49,322 37,651 (11)(12)(16)(19) 145,572 133,901 Total Control Investments (20.6% of net assets) $ 283,599 $ 270,765 Affiliate Investments (17) Assembled Brands Capital LLC Specialized Finance First Lien Revolver, LIBOR+6.00% cash due 10/17/2023 7.00 % $ 15,899 $ 15,900 $ 15,712 (6)(15)(19) 1,609,201 Class A Units 764 587 (15) 1,019,168.80 Preferred Units, 6% 1,019 1,152 (15) 70,424.5641 Class A Warrants (exercise price $3.3778) expiration date 9/9/2029 — — (15) 17,683 17,451 Caregiver Services, Inc. Health Care Services 1,080,399 shares of Series A Preferred Stock, 10% 1,080 838 (15) 1,080 838 Total Affiliate Investments (1.4% of net assets) $ 18,763 $ 18,289 Non-Control/Non-Affiliate Investments (18) 4 Over International, LLC Commercial Printing First Lien Term Loan, LIBOR+6.00% cash due 6/7/2022 7.00 % $ 10,927 $ 10,524 $ 10,484 (6)(15) First Lien Revolver, LIBOR+6.00% cash due 6/7/2022 — (24) (93) (6)(15)(19) 10,500 10,391 109 Montgomery Owner LLC Real Estate Operating Companies First Lien Delayed Draw Term Loan, LIBOR+7.00% cash due 2/2/2023 7.50 % 3,102 2,984 3,153 (6)(15)(19) 2,984 3,153 A.T. Holdings II SÀRL Biotechnology First Lien Term Loan, 9.50% cash due 12/22/2022 37,158 36,930 36,972 (11)(15) 36,930 36,972 Access CIG, LLC Diversified Support Services First Lien Term Loan, LIBOR+3.75% cash due 2/27/2025 3.83 % 5,352 5,021 5,332 (6) Second Lien Term Loan, LIBOR+7.75% cash due 2/27/2026 7.83 % 17,000 16,923 17,028 (6) 21,944 22,360 84 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Accupac, Inc. Personal Products First Lien Term Loan, LIBOR+6.00% cash due 1/17/2026 7.00 % $ 16,140 $ 15,758 $ 16,140 (6)(15) First Lien Delayed Draw Term Loan, LIBOR+6.00% cash due 1/17/2026 — (29) — (6)(15)(19) First Lien Revolver, LIBOR+6.00% cash due 1/17/2026 7.00 % 1,838 1,789 1,838 (6)(15)(19) 17,518 17,978 Acquia Inc. Application Software First Lien Term Loan, LIBOR+7.00% cash due 10/31/2025 8.00 % 27,349 26,936 27,295 (6)(15) First Lien Revolver, LIBOR+7.00% cash due 10/31/2025 8.00 % 179 148 175 (6)(15)(19) 27,084 27,470 ADB Companies, LLC Construction & Engineering First Lien Term Loan, LIBOR+6.25% cash due 12/18/2025 7.25 % 15,463 14,817 15,287 (6)(15) 14,817 15,287 Aden & Anais Merger Sub, Inc. Apparel, Accessories & Luxury Goods 51,645 Common Units in Aden & Anais Holdings, Inc. 5,165 — (15) 5,165 — AI Sirona (Luxembourg) Acquisition S.a.r.l. Pharmaceuticals Second Lien Term Loan, EURIBOR+7.25% cash due 9/28/2026 7.25 % € 24,838 27,720 28,738 (6)(11)(15) 27,720 28,738 AirStrip Technologies, Inc. Application Software 5,715 Common Stock Warrants (exercise price $139.99) expiration date 5/11/2025 90 — (15) 90 — All Web Leads, Inc. Advertising First Lien Term Loan, LIBOR+6.50% cash due 12/29/2023 7.50 % $ 23,899 21,512 22,992 (6)(15) 21,512 22,992 Alvogen Pharma US, Inc. Pharmaceuticals First Lien Term Loan, LIBOR+5.25% cash due 12/31/2023 6.25 % 13,825 13,329 13,383 (6) 13,329 13,383 Alvotech Holdings S.A. Biotechnology (13) Fixed Rate Bond 15% PIK Tranche A due 6/24/2025 20,967 20,576 20,967 (11)(15) Fixed Rate Bond 15% PIK Tranche B due 6/24/2025 20,512 20,169 20,512 (11)(15) 27,308 Common Shares 6,322 6,322 (15) 47,067 47,801 Amplify Finco Pty Ltd. Movies & Entertainment First Lien Term Loan, LIBOR+4.25% cash due 11/26/2026 5.00 % 15,376 13,814 14,985 (6)(11)(15) Second Lien Term Loan, LIBOR+8.00% cash due 11/26/2027 8.75 % 12,500 12,188 12,063 (6)(11)(15) 26,002 27,048 Ankura Consulting Group LLC Research & Consulting Services Second Lien Term Loan, LIBOR+8.00% cash due 3/19/2029 8.75 % 7,466 7,354 7,606 (6)(15) 7,354 7,606 Apptio, Inc. Application Software First Lien Term Loan, LIBOR+7.25% cash due 1/10/2025 8.25 % 34,458 33,420 33,922 (6)(15) First Lien Revolver, LIBOR+7.25% cash due 1/10/2025 8.25 % 892 849 858 (6)(15)(19) 34,269 34,780 Ardonagh Midco 3 PLC Insurance Brokers First Lien Term Loan, EURIBOR+7.25% cash due 7/14/2026 8.25 % € 1,964 2,179 2,283 (6)(11)(15) First Lien Term Loan, UK LIBOR+7.25% cash due 7/14/2026 8.00 % £ 18,636 23,336 25,329 (6)(11)(15) First Lien Delayed Draw Term Loan, LIBOR+6.00% cash due 7/14/2026 $ — — — (6)(11)(15)(19) First Lien Delayed Draw Term Loan, SONIA+6.00% cash due 7/14/2026 £ — — — (6)(11)(15)(19) 25,515 27,612 85 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Associated Asphalt Partners, LLC Construction Materials First Lien Term Loan, LIBOR+5.25% cash due 4/5/2024 6.25 % $ 2,531 $ 2,245 $ 2,350 (6) 2,245 2,350 Athenex, Inc. Pharmaceuticals First Lien Term Loan, 11.00% cash due 6/19/2026 42,145 40,475 41,845 (11)(15) First Lien Delayed Draw Term Loan, 11.00% cash due 6/19/2026 — (274) (150) (11)(15)(19) 328,149 Common Stock Warrants (exercise price $12.63) expiration date 6/19/2027 973 95 (11)(15) 41,174 41,790 Aurora Lux Finco S.À.R.L. Airport Services First Lien Term Loan, LIBOR+6.00% cash due 12/24/2026 7.00 % 22,655 22,232 21,318 (6)(11)(15) 22,232 21,318 The Avery Real Estate Operating Companies First Lien Delayed Draw Term Loan in T8 Urban Condo Owner, LLC, LIBOR+7.30% cash due 2/17/2023 7.55 % 20,287 19,933 20,490 (6)(15)(19) Subordinated Delayed Draw Debt in T8 Senior Mezz LLC, LIBOR+12.50% cash due 2/17/2023 12.75 % 4,692 4,614 4,698 (6)(15)(19) 24,547 25,188 BAART Programs, Inc. Health Care Services Second Lien Term Loan, LIBOR+8.50% cash due 6/11/2028 9.50 % 7,166 7,059 7,130 (6)(15) Second Lien Delayed Draw Term Loan, LIBOR+8.50% cash due 6/11/2028 — (52) (18) (6)(15)(19) 7,007 7,112 Berner Food & Beverage, LLC Soft Drinks First Lien Term Loan, LIBOR+6.50% cash due 7/30/2027 7.50 % 33,412 32,844 32,844 (6)(15) First Lien Revolver, LIBOR+6.50% cash due 7/30/2027 7.50 % 619 566 566 (6)(15)(19) 33,410 33,410 Blackhawk Network Holdings, Inc. Data Processing & Outsourced Services Second Lien Term Loan, LIBOR+7.00% cash due 6/15/2026 7.13 % 30,625 30,181 30,523 (6) 30,181 30,523 Blumenthal Temecula, LLC Automotive Retail First Lien Term Loan, 9.00% cash due 9/24/2023 3,979 3,980 3,979 (15) 1,293,324 Preferred Units in Unstoppable Automotive AMV, LLC 1,293 1,293 (15) 298,460 Preferred Units in Unstoppable Automotive VMV, LLC 298 298 (15) 298,460 Common Units in Unstoppable Automotive AMV, LLC 298 298 (15) 99,486 Common Units in Unstoppable Automotive VMV, LLC 100 99 (15) 5,969 5,967 Cadence Aerospace, LLC Aerospace & Defense First Lien Term Loan, LIBOR+6.50% cash 2.00% PIK due 11/14/2023 7.50 % 14,146 12,574 12,992 (6)(15) 12,574 12,992 Chief Power Finance II, LLC Independent Power Producers & Energy Traders First Lien Term Loan, LIBOR+6.50% cash due 12/31/2022 7.50 % 23,850 23,458 23,552 (6)(15) 23,458 23,552 CircusTrix Holdings, LLC Leisure Facilities First Lien Term Loan, LIBOR+5.50% cash 2.50% PIK due 7/16/2023 6.50 % 10,686 9,793 8,816 (6)(15)(19) 9,793 8,816 CITGO Holding, Inc. Oil & Gas Refining & Marketing First Lien Term Loan, LIBOR+7.00% cash due 8/1/2023 8.00 % 11,635 11,517 11,512 (6) Fixed Rate Bond, 9.25% cash due 8/1/2024 10,672 10,672 10,765 22,189 22,277 86 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes CITGO Petroleum Corp. Oil & Gas Refining & Marketing First Lien Term Loan, LIBOR+6.25% cash due 3/28/2024 7.25 % $ 14,221 $ 13,855 $ 14,269 (6) 13,855 14,269 Clear Channel Outdoor Holdings Inc. Advertising Fixed Rate Bond, 7.50% cash due 6/1/2029 7,137 7,137 7,431 (11) 7,137 7,431 Continental Intermodal Group LP Oil & Gas Storage & Transportation First Lien Term Loan, LIBOR+9.50% PIK due 1/28/2025 38,876 36,668 32,628 (6)(15) Common Stock Warrants expiration date 7/28/2025 648 1,909 (15) 37,316 34,537 Convergeone Holdings, Inc. IT Consulting & Other Services First Lien Term Loan, LIBOR+5.00% cash due 1/4/2026 5.08 % 7,024 6,848 7,003 (6) 6,848 7,003 Conviva Inc. Application Software 517,851 Shares of Series D Preferred Stock 605 894 (15) 605 894 CorEvitas, LLC Health Care Services First Lien Term Loan, LIBOR+5.50% cash due 12/13/2025 6.50 % 10,196 10,071 10,109 (6)(15) First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 12/13/2025 6.50 % 1,943 1,894 1,912 (6)(15)(19) First Lien Revolver, PRIME+4.50% cash due 12/13/2025 7.75 % 305 283 290 (6)(15)(19) 1,099 Class A2 Common Units in CorEvitas Holdings, L.P. 1,038 1,177 (15) 13,286 13,488 Coty Inc. Personal Products First Lien Revolver, LIBOR+1.75% cash due 4/5/2023 — (712) (395) (6)(11)(15)(19) (712) (395) Coyote Buyer, LLC Specialty Chemicals First Lien Term Loan, LIBOR+6.00% cash due 2/6/2026 7.00 % 18,387 17,887 18,225 (6)(15) First Lien Revolver, LIBOR+6.00% cash due 2/6/2025 — (13) (12) (6)(15)(19) 17,874 18,213 Curium Bidco S.à.r.l. Biotechnology Second Lien Term Loan, LIBOR+7.75% cash due 10/27/2028 8.50 % 16,787 16,535 17,070 (6)(11)(15) 16,535 17,070 Delta Topco, Inc. Systems Software Second Lien Term Loan, LIBOR+7.25% cash due 12/1/2028 8.00 % 6,680 6,647 6,769 (6) 6,647 6,769 Dialyze Holdings, LLC Health Care Equipment First Lien Term Loan, LIBOR+7.00% cash 2.00% PIK due 8/4/2026 8.00 % 24,093 22,439 22,467 (6)(15) First Lien Delayed Draw Term Loan, LIBOR+7.00% cash 2.00% PIK due 8/4/2026 — (170) (163) (6)(15)(19) 5,403,823 Class A Warrants (exercise price $1.00) expiration date 8/4/2028 1,405 1,459 (15) 23,674 23,763 Digital.AI Software Holdings, Inc. Application Software First Lien Term Loan, LIBOR+7.00% cash due 2/10/2027 8.00 % 10,003 9,627 9,783 (6)(15) First Lien Revolver, LIBOR+7.00% cash due 2/10/2027 8.00 % 180 151 156 (6)(15)(19) 9,778 9,939 DirecTV Financing, LLC Cable & Satellite First Lien Term Loan, LIBOR+5.00% cash due 8/2/2027 5.75 % 27,000 26,730 27,048 (6) 26,730 27,048 Eagleview Technology Corporation Application Software Second Lien Term Loan, LIBOR+7.50% cash due 8/14/2026 8.50 % 8,974 8,884 8,918 (6)(15) 8,884 8,918 87 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes EHR Canada, LLC Food Retail First Lien Term Loan, LIBOR+8.00% cash due 12/31/2021 9.00 % $ 3,750 $ 3,745 $ 3,750 (6)(15) 3,745 3,750 EOS Fitness Opco Holdings, LLC Leisure Facilities 487.5 Class A Preferred Units, 12% 488 274 (15) 12,500 Class B Common Units — — (15) 488 274 Firstlight Holdco, Inc. Alternative Carriers First Lien Term Loan, LIBOR+3.50% cash due 7/23/2025 3.58 % 7,012 6,578 6,939 (6) 6,578 6,939 Fortress Biotech, Inc. Biotechnology First Lien Term Loan, 11.00% cash due 8/27/2025 11,359 10,722 11,075 (11)(15) 331,200 Common Stock Warrants (exercise price $3.20) expiration date 8/27/2030 405 341 (11)(15) 11,127 11,416 GI Chill Acquisition LLC Managed Health Care First Lien Term Loan, LIBOR+3.75% cash due 8/6/2025 3.90 % 12,653 12,442 12,621 (6)(15) Second Lien Term Loan, LIBOR+7.50% cash due 8/6/2026 7.63 % 6,250 6,212 6,219 (6)(15) 18,654 18,840 GKD Index Partners, LLC Specialized Finance First Lien Term Loan, LIBOR+8.50% cash due 6/29/2023 9.50 % 26,360 25,837 25,931 (6)(15) First Lien Revolver, LIBOR+8.50% cash due 6/29/2023 9.50 % 1,280 1,251 1,252 (6)(15)(19) 27,088 27,183 Global Medical Response, Inc. Health Care Services First Lien Term Loan, LIBOR+4.25% cash due 3/14/2025 5.25 % 8,630 8,399 8,674 (6) 8,399 8,674 Gulf Operating, LLC Oil & Gas Storage & Transportation First Lien Revolver, LIBOR+4.00% cash due 12/27/2021 — (704) (75) (6)(15)(19) (704) (75) Houghton Mifflin Harcourt Publishers Inc. Education Services First Lien Term Loan, LIBOR+6.25% cash due 11/22/2024 7.25 % 1,007 981 1,009 (6)(11) 981 1,009 iCIMs, Inc. Application Software First Lien Term Loan, LIBOR+6.50% cash due 9/12/2024 7.50 % 25,635 25,024 25,525 (6)(15) First Lien Revolver, LIBOR+6.50% cash due 9/12/2024 7.50 % 1,176 1,147 1,171 (6)(15) 26,171 26,696 Immucor, Inc. Health Care Supplies First Lien Term Loan, LIBOR+5.75% cash due 7/2/2025 6.75 % 8,657 8,425 8,570 (6)(15) Second Lien Term Loan, LIBOR+8.00% cash 3.50% PIK due 10/2/2025 9.00 % 21,834 21,225 21,616 (6)(15) 29,650 30,186 Integral Development Corporation Other Diversified Financial Services 1,078,284 Common Stock Warrants (exercise price $0.9274) expiration date 7/10/2024 113 — (15) 113 — Inventus Power, Inc. Electrical Components & Equipment First Lien Term Loan, LIBOR+5.00% cash due 3/29/2024 6.00 % 18,849 18,693 18,708 (6)(15) Second Lien Term Loan, LIBOR+8.50% cash due 9/29/2024 9.50 % 13,674 13,434 13,434 (6)(15) 32,127 32,142 88 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes INW Manufacturing, LLC Personal Products First Lien Term Loan, LIBOR+5.75% cash due 5/7/2027 6.50 % $ 37,031 $ 35,988 $ 36,291 (6)(15) 35,988 36,291 Itafos Inc. Fertilizers & Agricultural Chemicals First Lien Term Loan, LIBOR+8.25% cash due 8/25/2024 9.25 % 22,506 21,636 21,651 (6)(15) 21,636 21,651 Ivanti Software, Inc. Application Software Second Lien Term Loan, LIBOR+8.50% cash due 12/1/2028 9.50 % 17,346 16,864 17,368 (6)(15) 16,864 17,368 Jazz Acquisition, Inc. Aerospace & Defense First Lien Term Loan, LIBOR+7.50% cash due 1/29/2027 8.50 % 36,603 35,292 36,531 (6)(15) 35,292 36,531 Latam Airlines Group S.A. Airlines First Lien Delayed Draw Term Loan, LIBOR+11.00% PIK due 3/29/2022 16,239 16,085 16,356 (6)(11)(15)(19) 16,085 16,356 Lift Brands Holdings, Inc. Leisure Facilities 2,000,000 Class A Common Units in Snap Investments, LLC 1,399 — (15) 1,399 — Lightbox Intermediate, L.P. Real Estate Services First Lien Term Loan, LIBOR+5.00% cash due 5/9/2026 5.13 % 41,432 40,445 41,225 (6)(15) 40,445 41,225 LogMeIn, Inc. Application Software First Lien Term Loan, LIBOR+4.75% cash due 8/31/2027 4.83 % 3,970 3,720 3,973 (6) 3,720 3,973 LTI Holdings, Inc. Electronic Components Second Lien Term Loan, LIBOR+6.75% cash due 9/6/2026 6.83 % 10,140 10,080 10,127 (6) 10,080 10,127 Marinus Pharmaceuticals, Inc. Pharmaceuticals First Lien Term Loan, 11.50% cash due 5/11/2026 3,441 3,377 3,389 (11)(15) First Lien Delayed Draw Term Loan, 11.50% cash due 5/11/2026 6,881 6,755 6,778 (11)(15)(19) 10,132 10,167 Mayfield Agency Borrower Inc. Property & Casualty Insurance First Lien Term Loan, LIBOR+4.50% cash due 2/28/2025 4.58 % 9,949 9,884 9,949 (6) 9,884 9,949 MedAssets Software Intermediate Holdings, Inc. Health Care Technology Second Lien Term Loan, LIBOR+7.75% cash due 1/29/2029 8.50 % 14,137 13,877 13,960 (6)(15) 13,877 13,960 MHE Intermediate Holdings, LLC Diversified Support Services First Lien Term Loan, LIBOR+5.75% cash due 7/21/2027 6.75 % 16,429 16,111 16,100 (6)(15) First Lien Delayed Draw Term Loan, LIBOR+5.75% cash due 7/21/2027 6.75 % 106 84 83 (6)(15)(19) First Lien Revolver, LIBOR+5.75% cash due 7/21/2027 — (27) (28) (6)(15)(19) 16,168 16,155 Mindbody, Inc. Internet Services & Infrastructure First Lien Term Loan, LIBOR+7.00% cash 1.50% PIK due 2/14/2025 8.00 % 38,774 37,513 38,038 (6)(15) First Lien Revolver, LIBOR+8.00% cash due 2/14/2025 — (75) (76) (6)(15)(19) 37,438 37,962 89 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Ministry Brands, LLC Application Software First Lien Revolver, LIBOR+5.00% cash due 12/2/2022 $ — $ (9) $ (9) (6)(15)(19) Second Lien Term Loan, LIBOR+9.25% cash due 6/2/2023 10.25 % 11,000 10,844 10,906 (6)(15) 10,835 10,897 Mosaic Companies, LLC Home Improvement Retail First Lien Term Loan, LIBOR+6.75% cash due 7/2/2026 7.75 % 47,388 46,487 46,488 (6)(15) 46,487 46,488 MRI Software LLC Application Software First Lien Term Loan, LIBOR+5.50% cash due 2/10/2026 6.50 % 27,352 26,815 27,335 (6)(15) First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 2/10/2026 — (25) — (6)(15)(19) First Lien Revolver, LIBOR+5.50% cash due 2/10/2026 — (13) (1) (6)(15)(19) 26,777 27,334 Navisite, LLC Data Processing & Outsourced Services Second Lien Term Loan, LIBOR+8.50% cash due 12/30/2026 9.50 % 22,560 22,165 22,176 (6)(15) 22,165 22,176 NeuAG, LLC Fertilizers & Agricultural Chemicals First Lien Term Loan, LIBOR+5.50% cash 7.00% PIK due 9/11/2024 7.00 % 47,031 45,279 45,996 (6)(15) First Lien Delayed Draw Term Loan, LIBOR+5.50% cash 7.00% PIK due 9/11/2024 — (202) (120) (6)(15)(19) 45,077 45,876 NN, Inc. Industrial Machinery First Lien Term Loan, LIBOR+6.88% cash due 9/19/2026 7.88 % 59,309 57,971 58,419 (6)(11)(15) 57,971 58,419 OEConnection LLC Application Software First Lien Term Loan, LIBOR+4.00% cash due 9/25/2026 4.08 % 3,355 3,152 3,351 (6) 3,152 3,351 Olaplex, Inc. Personal Products First Lien Term Loan, LIBOR+6.25% cash due 1/8/2026 7.25 % 52,122 50,906 51,731 (6)(15) First Lien Revolver, LIBOR+6.25% cash due 1/8/2025 — (58) (75) (6)(15)(19) 50,848 51,656 OmniSYS Acquisition Corporation Diversified Support Services 100,000 Common Units in OSYS Holdings, LLC 1,000 729 (15) 1,000 729 Onvoy, LLC Integrated Telecommunication Services First Lien Term Loan, LIBOR+4.50% cash due 2/10/2024 5.50 % 3,601 3,410 3,603 (6) Second Lien Term Loan, LIBOR+10.50% cash due 2/10/2025 11.50 % 9,277 9,277 9,277 (6)(15) 19,666.67 Class A Units in GTCR Onvoy Holdings, LLC 1,967 2,372 (15) 13,664.73 Series 3 Class B Units in GTCR Onvoy Holdings, LLC — — (15) 14,654 15,252 OTG Management, LLC Airport Services First Lien Term Loan, LIBOR+10.00% cash due 9/1/2025 11.00 % 19,894 19,504 19,496 (6)(15) First Lien Delayed Draw Term Loan, LIBOR+10.00% cash due 9/1/2025 — (37) (38) (6)(15)(19) 19,467 19,458 P & L Development, LLC Pharmaceuticals Fixed Rate Bond, 7.75% cash due 11/15/2025 7,776 7,832 8,089 7,832 8,089 Park Place Technologies, LLC Internet Services & Infrastructure First Lien Term Loan, LIBOR+5.00% cash due 11/10/2027 6.00 % 9,950 9,479 9,961 (6) 9,479 9,961 90 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Performance Health Holdings, Inc. Health Care Distributors First Lien Term Loan, LIBOR+6.00% cash due 7/12/2027 7.00 % $ 20,085 $ 19,698 $ 19,683 (6)(15) 19,698 19,683 Pingora MSR Opportunity Fund I-A, LP Thrifts & Mortgage Finance 1.86% limited partnership interest 752 112 (11)(16)(19) 752 112 Planview Parent, Inc. Application Software Second Lien Term Loan, LIBOR+7.25% cash due 12/18/2028 8.00 % 28,627 28,198 28,699 (6)(15) 28,198 28,699 PLNTF Holdings, LLC Leisure Facilities First Lien Term Loan, LIBOR+8.00% cash due 3/22/2026 9.00 % 13,729 13,482 13,798 (6)(15) 13,482 13,798 Pluralsight, LLC Application Software First Lien Term Loan, LIBOR+8.00% cash due 4/6/2027 9.00 % 48,689 47,788 47,763 (6)(15) First Lien Revolver, LIBOR+8.00% cash due 4/6/2027 — (65) (67) (6)(15)(19) 47,723 47,696 PRGX Global, Inc. Data Processing & Outsourced Services First Lien Term Loan, LIBOR+6.75% cash due 3/3/2026 7.75 % 34,118 33,016 33,547 (6)(15) First Lien Revolver, LIBOR+6.75% cash due 3/3/2026 — (44) (42) (6)(15)(19) 80,515 Class B Common Units 79 81 (15) 33,051 33,586 ProFrac Services, LLC Industrial Machinery First Lien Term Loan, LIBOR+8.50% cash due 9/15/2023 9.75 % 30,910 29,146 30,600 (6)(15) 29,146 30,600 Project Boost Purchaser, LLC Application Software Second Lien Term Loan, LIBOR+8.00% cash due 5/31/2027 8.08 % 5,250 5,151 5,224 (6)(15) 5,151 5,224 Quantum Bidco Limited Food Distributors First Lien Term Loan, UK LIBOR+6.00% cash due 1/29/2028 6.11 % £ 3,501 4,625 4,673 (6)(11) 4,625 4,673 QuorumLabs, Inc. Application Software 64,887,669 Junior-2 Preferred Stock 375 — (15) 375 — Relativity ODA LLC Application Software First Lien Term Loan, LIBOR+7.50% PIK due 5/12/2027 $ 22,856 22,337 22,376 (6)(15) First Lien Revolver, LIBOR+6.50% cash due 5/12/2027 — (52) (47) (6)(15)(19) 22,285 22,329 Renaissance Holding Corp. Diversified Banks Second Lien Term Loan, LIBOR+7.00% cash due 5/29/2026 7.08 % 3,542 3,515 3,562 (6) 3,515 3,562 RevSpring, Inc. Commercial Printing First Lien Term Loan, LIBOR+4.25% cash due 10/11/2025 4.38 % 9,725 9,185 9,709 (6) 9,185 9,709 RumbleOn, Inc. Automotive Retail First Lien Term Loan, LIBOR+8.25% cash due 8/31/2026 9.25 % 38,036 35,651 35,640 (6)(11)(15) First Lien Delayed Draw Term Loan, LIBOR+8.25% cash due 8/31/2026 — (1,022) (1,027) (6)(11)(15)(19) 164,660 Class B Common Stock Warrants (exercise price $33.00) expiration date 2/28/2023 1,202 1,553 (15) 35,831 36,166 91 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Sabert Corporation Metal & Glass Containers First Lien Term Loan, LIBOR+4.50% cash due 12/10/2026 5.50 % $ 1,818 $ 1,711 $ 1,825 (6) 1,711 1,825 Scilex Pharmaceuticals Inc. Pharmaceuticals Fixed Rate Zero Coupon Bond due 8/15/2026 7,692 6,512 7,169 (15) 6,512 7,169 ShareThis, Inc. Application Software 345,452 Series C Preferred Stock Warrants (exercise price $3.0395) expiration date 3/4/2024 367 — (15) 367 — SIO2 Medical Products, Inc. Metal & Glass Containers Subordinated Debt, 11.25% cash due 2/28/2022 15,896 15,161 15,022 (15) Subordinated Delayed Draw Debt, 11.25% cash due 2/28/2022 — (110) (119) (15)(19) Common Stock Warrants (exercise price $0.75) expiration date 7/31/2028 681 685 (15) 15,732 15,588 Sirva Worldwide, Inc. Diversified Support Services First Lien Term Loan, LIBOR+5.50% cash due 8/4/2025 5.58 % 1,739 1,554 1,644 (6) 1,554 1,644 SM Wellness Holdings, Inc. Health Care Services Second Lien Term Loan, LIBOR+8.00% cash due 4/16/2029 8.75 % 9,109 8,972 9,177 (6)(15) 8,972 9,177 SonicWall US Holdings Inc. Technology Distributors Second Lien Term Loan, LIBOR+7.50% cash due 5/18/2026 7.63 % 3,195 3,163 3,178 (6) 3,163 3,178 Sorrento Therapeutics, Inc. Biotechnology 50,000 Common Stock Units 197 382 (11) 197 382 Star US Bidco LLC Industrial Machinery First Lien Term Loan, LIBOR+4.25% cash due 3/17/2027 5.25 % 1,194 1,114 1,199 (6) 1,114 1,199 SumUp Holdings Luxembourg S.À.R.L. Other Diversified Financial Services First Lien Delayed Draw Term Loan, EURIBOR+8.50% cash due 3/10/2026 10.00 % € 13,980 15,991 15,908 (6)(11)(15)(19) 15,991 15,908 Sunland Asphalt & Construction, LLC Construction & Engineering First Lien Term Loan, LIBOR+6.00% cash due 1/13/2026 7.00 % $ 43,052 41,782 42,450 (6)(15) First Lien Revolver, LIBOR+6.00% cash due 1/13/2022 7.00 % 203 150 169 (6)(15)(19) 41,932 42,619 Supermoose Borrower, LLC Application Software First Lien Term Loan, LIBOR+3.75% cash due 8/29/2025 3.88 % 8,576 7,581 7,996 (6) 7,581 7,996 SVP-Singer Holdings Inc. Home Furnishings First Lien Term Loan, LIBOR+6.75% cash due 7/28/2028 7.50 % 20,976 19,537 19,735 (6)(15) 19,537 19,735 Swordfish Merger Sub LLC Auto Parts & Equipment Second Lien Term Loan, LIBOR+6.75% cash due 2/2/2026 7.75 % 12,500 12,466 12,365 (6)(15) 12,466 12,365 Tacala, LLC Restaurants Second Lien Term Loan, LIBOR+7.50% cash due 2/4/2028 8.25 % 9,448 9,317 9,451 (6) 9,317 9,451 92 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Tecta America Corp. Construction & Engineering Second Lien Term Loan, LIBOR+8.50% cash due 4/9/2029 9.25 % $ 5,203 $ 5,125 $ 5,203 (6)(15) 5,125 5,203 Telestream Holdings Corporation Application Software First Lien Term Loan, LIBOR+8.75% cash due 10/15/2025 9.75 % 18,510 18,017 18,250 (6)(15) First Lien Revolver, LIBOR+8.75% cash due 10/15/2025 9.75 % 492 464 468 (6)(15)(19) 18,481 18,718 TerSera Therapeutics LLC Pharmaceuticals Second Lien Term Loan, LIBOR+9.50% cash due 3/30/2026 10.50 % 29,663 29,359 29,371 (6)(15) 668,879 Common Units of TerSera Holdings LLC 2,192 3,487 (15) 31,551 32,858 TGNR HoldCo LLC Integrated Oil & Gas Subordinated Debt, 11.50% cash due 5/14/2026 4,984 4,842 4,884 (11)(15)(20) 4,842 4,884 Thermacell Repellents, Inc. Leisure Products First Lien Term Loan, LIBOR+5.75% cash due 12/4/2026 6.75 % 6,636 6,603 6,603 (6)(15) First Lien Revolver, LIBOR+5.75% cash due 12/4/2026 — (4) (4) (6)(15)(19) 6,599 6,599 Thrasio, LLC Internet & Direct Marketing Retail First Lien Term Loan, LIBOR+7.00% cash due 12/18/2026 8.00 % 37,876 36,736 37,686 (6)(15) 8,434 Shares of Series C-3 Preferred Stock in Thrasio Holdings, Inc. 101 171 (15) 284,650.32 Shares of Series C-2 Preferred Stock in Thrasio Holdings, Inc. 2,410 5,764 (15) 23,201 Shares of Series X Preferred Stock in Thrasio Holdings, Inc. 22,986 24,803 (15)(19) 62,233 68,424 TIBCO Software Inc. Application Software Second Lien Term Loan, LIBOR+7.25% cash due 3/3/2028 7.34 % 16,788 16,681 17,002 (6) 16,681 17,002 TigerConnect, Inc. Application Software 299,110 Series B Preferred Stock Warrants (exercise price $1.3373) expiration date 12/8/2024 60 525 (15) 60 525 Transact Holdings Inc. Application Software First Lien Term Loan, LIBOR+4.75% cash due 4/30/2026 4.83 % 6,860 6,757 6,809 (6)(15) 6,757 6,809 Velocity Commercial Capital, LLC Thrifts & Mortgage Finance First Lien Term Loan, LIBOR+8.00% cash due 2/5/2026 9.00 % 15,909 15,327 15,830 (6)(15) 15,327 15,830 Veritas US Inc. Application Software First Lien Term Loan, LIBOR+5.00% cash due 9/1/2025 6.00 % 5,940 5,599 5,975 (6) 5,599 5,975 Vitalyst Holdings, Inc. IT Consulting & Other Services 675 Series A Preferred Stock Units 675 440 (15) 7,500 Class A Common Stock Units 75 — (15) 750 440 Win Brands Group LLC Housewares & Specialties First Lien Term Loan, LIBOR+9.00% cash 5.00% PIK due 1/22/2026 10.00 % 1,894 1,875 1,884 (6)(15) 181 Class F Warrants in Brand Value Growth LLC (exercise price $0.01) expiration date 1/25/2027 — 119 (15) 1,875 2,003 93 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Windstream Services II, LLC Integrated Telecommunication Services First Lien Term Loan, LIBOR+6.25% cash due 9/21/2027 7.25 % $ 31,598 $ 30,347 $ 31,793 (6) 18,032 Shares of Common Stock in Windstream Holdings II, LLC 216 363 (15) 109,420 Warrants in Windstream Holdings II, LLC 1,842 2,199 (15) 32,405 34,355 WP CPP Holdings, LLC Aerospace & Defense First Lien Term Loan, LIBOR+3.75% cash due 4/30/2025 4.75 % 4,369 4,005 4,264 (6) Second Lien Term Loan, LIBOR+7.75% cash due 4/30/2026 8.75 % 16,000 15,758 15,815 (6)(15) 19,763 20,079 WPEngine, Inc. Application Software First Lien Term Loan, LIBOR+6.50% cash due 3/27/2026 7.50 % 40,536 39,778 40,013 (6)(15) 39,778 40,013 WWEX Uni Topco Holdings, LLC Air Freight & Logistics Second Lien Term Loan, LIBOR+7.00% cash due 7/26/2029 7.75 % 5,000 4,925 4,981 (6) 4,925 4,981 Zep Inc. Specialty Chemicals First Lien Term Loan, LIBOR+4.00% cash due 8/12/2024 5.00 % 6,495 6,165 6,353 (6) Second Lien Term Loan, LIBOR+8.25% cash due 8/11/2025 9.25 % 22,748 22,692 21,993 (6)(15) 28,857 28,346 Zephyr Bidco Limited Specialized Finance Second Lien Term Loan, UK LIBOR+7.50% cash due 7/23/2026 7.55 % £ 18,000 23,783 24,210 (6)(11) 23,783 24,210 Total Non-Control/Non-Affiliate Investments (172.7% of net assets) $ 2,236,759 $ 2,267,575 Total Portfolio Investments (194.7% of net assets) $ 2,539,121 $ 2,556,629 Cash and Cash Equivalents and Restricted Cash JP Morgan Prime Money Market Fund, Institutional Shares $ 23,600 $ 23,600 Other cash accounts 8,035 8,035 Total Cash and Cash Equivalents and Restricted Cash (2.4% of net assets) $ 31,635 $ 31,635 Total Portfolio Investments and Cash and Cash Equivalents and Restricted Cash (197.2% of net assets) $ 2,570,756 $ 2,588,264 Derivative Instrument Notional Amount to be Purchased Notional Amount to be Sold Maturity Date Counterparty Cumulative Unrealized Appreciation /(Depreciation) Foreign currency forward contract $ 52,186 £ 37,709 11/12/2021 JPMorgan Chase Bank, N.A. $ 1,339 Foreign currency forward contract $ 46,663 € 39,736 11/12/2021 JPMorgan Chase Bank, N.A. 573 $ 1,912 Derivative Instrument Company Receives Company Pays Counterparty Maturity Date Notional Amount Fair Value Interest rate swap Fixed 2.7% Floating 3-month LIBOR +1.658% Royal Bank of Canada 1/15/2027 $350,000 $(2,108) 94 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2021 (dollar amounts in thousands) (1) All debt investments are income producing unless otherwise noted. All equity investments are non-income producing unless otherwise noted. (2) See Note 3 in the accompanying notes to the Consolidated Financial Statements for portfolio composition by geographic region. (3) Equity ownership may be held in shares or units of companies related to the portfolio companies. (4) Interest rates may be adjusted from period to period on certain term loans and revolvers. These rate adjustments may be either temporary in nature due to tier pricing arrangements or financial or payment covenant violations in the original credit agreements or permanent in nature per loan amendment or waiver documents. (5) Each of the Company's investments is pledged as collateral under one or more of its credit facilities. A single investment may be divided into parts that are individually pledged as collateral to separate credit facilities. (6) The interest rate on the principal balance outstanding for all floating rate loans is indexed to the London Interbank Offered Rate ("LIBOR") and/or an alternate base rate (e.g., prime rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan. For each of these loans, the Company has provided the applicable margin over LIBOR or the alternate base rate based on each respective credit agreement and the cash interest rate as of period end. All LIBOR shown above is in U.S. dollars unless otherwise noted. As of September 30, 2021, the reference rates for the Company's variable rate loans were the 30-day LIBOR at 0.08%, the 60-day LIBOR at 0.11%, the 90-day LIBOR at 0.13%, the 180-day LIBOR at 0.16%, the 360-day LIBOR at 0.24%, the PRIME at 3.25%, the 30-day UK LIBOR at 0.05%, the 180-day UK LIBOR at 0.09%, the 30-day EURIBOR at (0.57)%, the 90-day EURIBOR at (0.56)% and the 180-day EURIBOR at (0.53)%. Most loans include an interest floor, which generally ranges from 0% to 1%. (7) Principal includes accumulated payment in kind ("PIK") interest and is net of repayments, if any. “£” signifies the investment is denominated in British Pounds. "€" signifies the investment is denominated in Euros. All other investments are denominated in U.S. dollars. (8) Control Investments generally are defined by the Investment Company Act of 1940, as amended (the "Investment Company Act"), as investments in companies in which the Company owns more than 25% of the voting securities or maintains greater than 50% of the board representation. (9) As defined in the Investment Company Act, the Company is deemed to be both an "Affiliated Person" of and to "Control" these portfolio companies as the Company owns more than 25% of the portfolio company's outstanding voting securities or has the power to exercise control over management or policies of such portfolio company (including through a management agreement). See Schedule 12-14 in the accompanying notes to the Consolidated Financial Statements for transactions during the year ended September 30, 2021 in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to control. (10) First Star Speir Aviation 1 Limited is a wholly-owned holding company formed by the Company in order to facilitate its investment strategy. In accordance with Accounting Standards Update ("ASU") 2013-08, the Company has deemed the holding company to be an investment company under accounting principles generally accepted in the United States ("GAAP") and therefore deemed it appropriate to consolidate the financial results and financial position of the holding company and to recognize dividend income versus a combination of interest income and dividend income. Accordingly, the debt and equity investments in the wholly-owned holding company are disregarded for accounting purposes since the economic substance of these instruments are equity investments in the operating entities. (11) Investment is not a "qualifying asset" as defined under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the Company's total assets. As of September 30, 2021, qualifying assets represented 75.7% of the Company's total assets and non-qualifying assets represented 24.3% of the Company's total assets. (12) Income producing through payment of dividends or distributions. (13) PIK interest income for this investment accrues at an annualized rate of 15%, however, the PIK interest is not contractually capitalized on the investment subsequent to a restructure that occurred during the year ended September 30, 2021. As a result, the principal amount of the investment does not increase over time for accumulated PIK interest. As of September 30, 2021, the accumulated PIK interest balance for the A notes and the B notes was $0.9 million and $0.8 million, respectively. (14) See Note 3 in the accompanying notes to the Consolidated Financial Statements for portfolio composition. (15) As of September 30, 2021, these investments were categorized as Level 3 within the fair value hierarchy established by Financial Accounting Standards Board ("FASB") guidance under Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurements and Disclosures ("ASC 820"). (16) This investment was valued using net asset value as a practical expedient for fair value. Consistent with ASC 820, these investments are excluded from the hierarchical levels. (17) Affiliate Investments generally are defined by the Investment Company Act as investments in companies in which the Company owns between 5% and 25% of the voting securities. (18) Non-Control/Non-Affiliate Investments are investments that are neither Control Investments nor Affiliate Investments. (19) Investment had undrawn commitments. Unamortized fees are classified as unearned income which reduces cost basis, which may result in a negative cost basis. A negative fair value may result from the unfunded commitment being valued below par. (20) This investment represents a participation interest in the underlying securities shown. See notes to Consolidated Financial Statements. 95 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Control Investments (8)(9) C5 Technology Holdings, LLC Data Processing & Outsourced Services 829 Common Units $ — $ — (20) 34,984,460.37 Preferred Units 34,984 27,638 (20) 34,984 27,638 Dominion Diagnostics, LLC Health Care Services First Lien Term Loan, LIBOR+5.00% cash due 2/28/2024 6.00 % $ 27,660 27,660 27,660 (6)(20) First Lien Revolver, LIBOR+5.00% cash due 2/28/2024 6.00 % 5,260 5,260 5,260 (6)(19)(20) 30,030.8 Common Units in DD Healthcare Services Holdings, LLC 18,626 7,667 (20) 51,546 40,587 First Star Speir Aviation Limited Airlines (10) First Lien Term Loan, 9.00% cash due 12/15/2020 11,510 2,035 11,510 (11)(20) 100% equity interest 8,500 1,622 (11)(12)(20) 10,535 13,132 New IPT, Inc. Oil & Gas Equipment & Services First Lien Term Loan, LIBOR+5.00% cash due 3/17/2021 6.00 % 2,304 2,304 1,800 (6)(20) First Lien Revolver, LIBOR+5.00% cash due 3/17/2021 6.00 % 1,009 1,009 788 (6)(19)(20) 50.087 Class A Common Units in New IPT Holdings, LLC — — (20) 3,313 2,588 Senior Loan Fund JV I, LLC Multi-Sector Holdings (14) Subordinated Debt, LIBOR+7.00% cash due 12/29/2028 7.17 % 96,250 96,250 96,250 (6)(11)(20) 87.5% LLC equity interest 49,322 21,190 (11)(16)(19) 145,572 117,440 Total Control Investments (22.0% of net assets) $ 245,950 $ 201,385 Affiliate Investments (17) Assembled Brands Capital LLC Specialized Finance First Lien Revolver, LIBOR+6.00% cash due 10/17/2023 7.00 % $ 4,688 $ 4,688 $ 4,194 (6)(19)(20) 1,609,201 Class A Units 764 483 (20) 1,019,168.80 Preferred Units, 6% 1,019 1,091 (20) 70,424.5641 Class A Warrants (exercise price $3.3778) expiration date 9/9/2029 — — (20) 6,471 5,768 Caregiver Services, Inc. Health Care Services 1,080,399 shares of Series A Preferred Stock, 10% 1,080 741 (20) 1,080 741 Total Affiliate Investments (0.7% of net assets) $ 7,551 $ 6,509 Non-Control/Non-Affiliate Investments (18) 4 Over International, LLC Commercial Printing First Lien Term Loan, LIBOR+6.00% cash due 6/7/2022 7.00 % $ 5,676 $ 5,654 $ 5,264 (6)(20) First Lien Revolver, LIBOR+6.00% cash due 6/7/2021 7.00 % 2,232 2,214 2,070 (6)(20) 7,868 7,334 99 Cents Only Stores LLC General Merchandise Stores First Lien Term Loan, LIBOR+5.00% cash 1.50% PIK due 1/13/2022 6.00 % 19,431 19,220 17,877 (6) 19,220 17,877 A.T. Holdings II SÀRL Biotechnology First Lien Term Loan, 12.00% cash due 4/27/2023 22,619 22,619 26,464 (11)(20) First Lien Delayed Draw Term Loan, 12.00% cash due 4/27/2023 1,508 1,508 1,780 (11)(19)(20) 24,127 28,244 96 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Access CIG, LLC Diversified Support Services Second Lien Term Loan, LIBOR+7.75% cash due 2/27/2026 7.91 % $ 15,000 $ 14,909 $ 14,250 (6) 14,909 14,250 Accupac, Inc. Personal Products First Lien Term Loan, LIBOR+6.00% cash due 1/17/2026 7.00 % 12,487 12,294 12,487 (6)(20) First Lien Delayed Draw Term Loan, LIBOR+6.00% cash due 1/17/2026 — (36) — (6)(19)(20) First Lien Revolver, LIBOR+6.00% cash due 1/17/2026 7.00 % 1,564 1,540 1,564 (6)(20) 13,798 14,051 Acquia Inc. Application Software First Lien Term Loan, LIBOR+7.00% cash due 10/31/2025 8.00 % 20,950 20,594 20,499 (6)(20) First Lien Revolver, LIBOR+7.00% cash due 10/31/2025 — (39) (48) (6)(19)(20) 20,555 20,451 Aden & Anais Merger Sub, Inc. Apparel, Accessories & Luxury Goods 51,645 Common Units in Aden & Anais Holdings, Inc. 5,165 — (20) 5,165 — AdVenture Interactive, Corp. Advertising 9,073 shares of common stock 13,611 13,440 (20) 13,611 13,440 AI Ladder (Luxembourg) Subco S.a.r.l. Electrical Components & Equipment First Lien Term Loan, LIBOR+4.50% cash due 7/9/2025 4.65 % 21,374 20,934 20,465 (6)(11) 20,934 20,465 AI Sirona (Luxembourg) Acquisition S.a.r.l. Pharmaceuticals Second Lien Term Loan, EURIBOR+7.25% cash due 9/28/2026 7.25 % € 24,838 27,668 28,435 (6)(11)(20) 27,668 28,435 Airbnb, Inc. Hotels, Resorts & Cruise Lines First Lien Term Loan, LIBOR+7.50% cash due 4/17/2025 8.50 % $ 15,743 15,378 17,081 (6) 15,378 17,081 AirStrip Technologies, Inc. Application Software 5,715 Common Stock Warrants (exercise price $139.99) expiration date 5/11/2025 90 — (20) 90 — Aldevron, L.L.C. Biotechnology First Lien Term Loan, LIBOR+4.25% cash due 10/12/2026 5.25 % 7,960 7,880 7,977 (6) 7,880 7,977 Algeco Scotsman Global Finance Plc Construction & Engineering Fixed Rate Bond, 8.00% cash due 2/15/2023 13,524 13,277 13,465 (11) 13,277 13,465 Alvotech Holdings S.A. Biotechnology (13) Fixed Rate Bond 15% PIK Note A due 12/13/2023 14,800 18,849 19,968 (11)(20) Fixed Rate Bond 15% PIK Note B due 12/13/2023 14,800 18,849 19,196 (11)(20) 37,698 39,164 Amplify Finco Pty Ltd. Movies & Entertainment First Lien Term Loan, LIBOR+4.00% cash due 11/26/2026 4.75 % 995 909 856 (6)(11)(20) Second Lien Term Loan, LIBOR+8.00% cash due 11/26/2027 8.75 % 12,500 12,188 9,438 (6)(11)(20) 13,097 10,294 97 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Ancile Solutions, Inc. Application Software First Lien Term Loan, LIBOR+7.00% cash due 6/30/2021 8.00 % $ 8,181 $ 8,150 $ 8,124 (6)(20) 8,150 8,124 Apptio, Inc. Application Software First Lien Term Loan, LIBOR+7.25% cash due 1/10/2025 8.25 % 23,764 23,420 23,297 (6)(20) First Lien Revolver, LIBOR+7.25% cash due 1/10/2025 — (22) (30) (6)(19)(20) 23,398 23,267 Ardonagh Midco 3 PLC Insurance Brokers First Lien Term Loan, EURIBOR+7.50% cash due 7/14/2026 8.50 % € 1,440 1,594 1,640 (6)(11)(20) First Lien Term Loan, UK LIBOR+7.50% cash due 7/14/2026 8.25 % £ 11,303 13,752 14,188 (6)(11)(20) First Lien Delayed Draw Term Loan, UK LIBOR+7.50% cash due 7/14/2026 £ — — — (6)(11)(19)(20) Fixed Rate Bond, 11.50% cash due 1/15/2027 $ 2,222 2,200 2,255 (11) 17,546 18,083 Associated Asphalt Partners, LLC Construction Materials First Lien Term Loan, LIBOR+5.25% cash due 4/5/2024 6.25 % 2,554 2,150 2,073 (6) 2,150 2,073 Asurion, LLC Property & Casualty Insurance Second Lien Term Loan, LIBOR+6.50% cash due 8/4/2025 6.65 % 19,985 19,950 20,058 (6) 19,950 20,058 Athenex, Inc. Pharmaceuticals First Lien Term Loan, 11.00% cash due 6/19/2026 28,475 27,252 28,261 (11)(20) First Lien Delayed Draw Term Loan, 11.00% cash due 6/19/2026 — (321) (171) (11)(19)(20) 266,052 Common Stock Warrants (exercise price $12.63) expiration date 6/19/2027 915 785 (11)(20) 27,846 28,875 Aurora Lux Finco S.À.R.L. Airport Services First Lien Term Loan, LIBOR+6.00% cash due 12/24/2026 7.00 % 22,885 22,376 21,283 (6)(11)(20) 22,376 21,283 Blackhawk Network Holdings, Inc. Data Processing & Outsourced Services Second Lien Term Loan, LIBOR+7.00% cash due 6/15/2026 7.19 % 26,250 26,049 24,150 (6) 26,049 24,150 Boxer Parent Company Inc. Systems Software First Lien Term Loan, LIBOR+4.25% cash due 10/2/2025 4.40 % 13,775 13,666 13,407 (6) 13,666 13,407 BX Commercial Mortgage Trust 2020-VIVA Diversified Real Estate Activities Class D Variable Notes due 3/9/2044 3.67 % 12,556 10,482 11,451 (6)(11)(20) Class E Variable Notes due 3/9/2044 3.67 % 6,221 4,806 5,395 (6)(11)(20) 15,288 16,846 California Pizza Kitchen, Inc. Restaurants First Lien Term Loan, LIBOR+8.00% cash due 8/23/2022 3,222 3,081 983 (6)(21) 3,081 983 Chief Power Finance II, LLC Independent Power Producers & Energy Traders First Lien Term Loan, LIBOR+6.50% cash due 12/31/2022 7.50 % 21,850 21,462 20,812 (6)(20) 21,462 20,812 CITGO Holding, Inc. Oil & Gas Refining & Marketing First Lien Term Loan, LIBOR+7.00% cash due 8/1/2023 8.00 % 11,753 11,570 11,081 (6) Fixed Rate Bond, 9.25% cash due 8/1/2024 10,672 10,672 10,192 22,242 21,273 98 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes CITGO Petroleum Corp. Oil & Gas Refining & Marketing First Lien Term Loan, LIBOR+5.00% cash due 3/28/2024 6.00 % $ 8,979 $ 8,890 $ 8,553 (6) 8,890 8,553 Continental Intermodal Group LP Oil & Gas Storage & Transportation First Lien Term Loan, LIBOR+9.50% PIK due 1/28/2025 24,741 24,741 21,753 (6)(20) Common Stock Warrants expiration date 7/28/2025 — 1,672 (20) 24,741 23,425 Convergeone Holdings, Inc. IT Consulting & Other Services First Lien Term Loan, LIBOR+5.00% cash due 1/4/2026 5.15 % 14,621 14,169 13,465 (6) 14,169 13,465 Conviva Inc. Application Software 417,851 Series D Preferred Stock Warrants (exercise price $1.1966) expiration date 2/28/2021 105 395 (20) 105 395 Corrona, LLC Health Care Services First Lien Term Loan, LIBOR+5.50% cash due 12/13/2025 6.50 % 10,300 10,144 10,152 (6)(20) First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 12/13/2025 — (32) (52) (6)(19)(20) First Lien Revolver, PRIME+4.50% cash due 12/13/2025 7.75 % 305 277 279 (6)(19)(20) 1,099 Class A2 Common Units in Corrona Group Holdings, L.P. 1,038 1,038 (20) 11,427 11,417 Coyote Buyer, LLC Specialty Chemicals First Lien Term Loan, LIBOR+6.00% cash due 2/6/2026 7.00 % 13,123 12,992 12,992 (6)(20) First Lien Revolver, LIBOR+6.00% cash due 2/6/2025 — (9) (9) (6)(19)(20) 12,983 12,983 CTOS, LLC Trading Companies & Distributors First Lien Term Loan, LIBOR+4.25% cash due 4/18/2025 4.40 % 10,139 10,228 10,069 (6) 10,228 10,069 Eagleview Technology Corporation Application Software Second Lien Term Loan, LIBOR+7.50% cash due 8/14/2026 8.50 % 12,000 11,880 10,440 (6)(20) 11,880 10,440 EHR Canada, LLC Food Retail First Lien Term Loan, LIBOR+8.00% cash due 12/4/2020 9.00 % 6,861 6,851 6,998 (6)(20) 6,851 6,998 EOS Fitness Opco Holdings, LLC Leisure Facilities 487.5 Class A Preferred Units, 12% 488 49 (20) 12,500 Class B Common Units — — (20) 488 49 ExamSoft Worldwide, Inc. Application Software 180,707 Class C Units in ExamSoft Investor LLC 181 500 (20) 181 500 Fortress Biotech, Inc. Biotechnology First Lien Term Loan, 11.00% cash due 8/27/2025 8,346 7,842 7,908 (11)(20) 243,348 Common Stock Warrants (exercise price $3.20) expiration date 8/27/2030 258 419 (11)(20) 8,100 8,327 GI Chill Acquisition LLC Managed Health Care First Lien Term Loan, LIBOR+4.00% cash due 8/6/2025 4.22 % 17,640 17,552 17,331 (6)(20) Second Lien Term Loan, LIBOR+7.50% cash due 8/6/2026 7.72 % 10,000 9,927 9,350 (6)(20) 27,479 26,681 99 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes GKD Index Partners, LLC Specialized Finance First Lien Term Loan, LIBOR+7.00% cash due 6/29/2023 8.00 % $ 20,933 $ 20,818 $ 20,577 (6)(20) First Lien Revolver, LIBOR+7.00% cash due 6/29/2023 8.00 % 924 915 904 (6)(19)(20) 21,733 21,481 Global Medical Response Health Care Services First Lien Term Loan, LIBOR+4.25% cash due 3/14/2025 5.25 % 6,256 6,152 6,084 (6) 6,152 6,084 Guidehouse LLP Research & Consulting Services First Lien Term Loan, LIBOR+4.50% cash due 5/1/2025 4.65 % 4,949 4,907 4,912 (6) Second Lien Term Loan, LIBOR+8.00% cash due 5/1/2026 8.15 % 20,000 19,930 19,300 (6)(20) 24,837 24,212 Gulf Operating, LLC Oil & Gas Storage & Transportation First Lien Term Loan, LIBOR+5.25% cash due 8/25/2023 6.25 % 3,275 1,874 2,324 (6) 1,874 2,324 Houghton Mifflin Harcourt Publishers Inc. Education Services First Lien Term Loan, LIBOR+6.25% cash due 11/22/2024 7.25 % 6,738 6,508 6,300 (6)(11) 6,508 6,300 I Drive Safely, LLC Education Services 125,079 Class A Common Units of IDS Investments, LLC 1,000 200 (20) 1,000 200 IBG Borrower LLC Apparel, Accessories & Luxury Goods First Lien Term Loan, LIBOR+7.00% cash due 8/2/2022 7.25 % 9,056 8,569 7,856 (6)(20) 8,569 7,856 iCIMs, Inc. Application Software First Lien Term Loan, LIBOR+6.50% cash due 9/12/2024 7.50 % 16,718 16,493 16,584 (6)(20) First Lien Revolver, LIBOR+6.50% cash due 9/12/2024 — (15) (7) (6)(19)(20) 16,478 16,577 Immucor, Inc. Health Care Supplies First Lien Term Loan, LIBOR+5.75% cash due 7/2/2025 6.75 % 6,477 6,354 6,347 (6)(20) First Lien Revolver, LIBOR+5.75% cash due 7/2/2025 — (10) (11) (6)(19)(20) Second Lien Term Loan, LIBOR+8.00% cash 3.50% PIK due 10/2/2025 9.00 % 15,611 15,316 15,298 (6)(20) 21,660 21,634 Integral Development Corporation Other Diversified Financial Services 1,078,284 Common Stock Warrants (exercise price $0.9274) expiration date 7/10/2024 113 — (20) 113 — L Squared Capital Partners LLC Multi-Sector Holdings 2.00% limited partnership interest 887 2,192 (11)(16) 887 2,192 Lanai Holdings III, Inc. Health Care Distributors First Lien Term Loan, LIBOR+4.75% cash due 8/29/2022 5.75 % 12,948 12,810 12,260 (6) 12,810 12,260 Lannett Company, Inc. Pharmaceuticals First Lien Term Loan, LIBOR+5.00% cash due 11/25/2020 6.00 % 460 460 456 (6)(11) 460 456 100 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Lift Brands Holdings, Inc. Leisure Facilities 2,000,000 Class A Common Units in Snap Investments, LLC $ 1,399 $ — (20) 1,399 — Lightbox Intermediate, L.P. Real Estate Services First Lien Term Loan, LIBOR+5.00% cash due 5/9/2026 5.15 % $ 39,500 39,023 37,723 (6)(20) 39,023 37,723 LogMeIn, Inc. Application Software Second Lien Term Loan, LIBOR+9.00% cash due 8/31/2028 9.16 % 9,293 8,831 9,247 (6) 8,831 9,247 LTI Holdings, Inc. Electronic Components First Lien Term Loan, LIBOR+4.75% cash due 7/24/2026 4.90 % 1,794 1,513 1,685 (6) First Lien Term Loan, LIBOR+3.50% cash due 9/6/2025 3.65 % 18,082 15,087 16,884 (6) Second Lien Term Loan, LIBOR+6.75% cash due 9/6/2026 6.90 % 9,000 9,000 7,983 (6) 25,600 26,552 Maravai Intermediate Holdings, LLC Biotechnology First Lien Term Loan, LIBOR+4.25% cash due 8/1/2025 5.25 % 11,760 11,642 11,789 (6)(20) 11,642 11,789 Mauser Packaging Solutions Holding Company Metal & Glass Containers Fixed Rate Bond, 8.50% cash due 4/15/2024 11,378 11,273 11,833 11,273 11,833 Mayfield Agency Borrower Inc. Property & Casualty Insurance First Lien Term Loan, LIBOR+4.50% cash due 2/28/2025 4.65 % 28,823 28,045 26,679 (6) 28,045 26,679 McAfee, LLC Systems Software Second Lien Term Loan, LIBOR+8.50% cash due 9/29/2025 9.50 % 7,000 7,028 7,074 (6) 7,028 7,074 MHE Intermediate Holdings, LLC Diversified Support Services First Lien Term Loan, LIBOR+5.00% cash due 3/8/2024 6.00 % 2,910 2,888 2,832 (6)(20) 2,888 2,832 Mindbody, Inc. Internet Services & Infrastructure First Lien Term Loan, LIBOR+7.00% cash 1.5% PIK due 2/14/2025 8.00 % 29,097 28,675 26,828 (6)(20) First Lien Revolver, LIBOR+8.00% cash due 2/14/2025 — (44) (241) (6)(19)(20) 28,631 26,587 Ministry Brands, LLC Application Software First Lien Revolver, LIBOR+5.00% cash due 12/2/2022 6.00 % 575 566 566 (6)(19)(20) Second Lien Term Loan, LIBOR+9.25% cash due 6/2/2023 10.25 % 9,000 8,934 8,923 (6)(20) 9,500 9,489 MRI Software LLC Application Software First Lien Term Loan, LIBOR+5.50% cash due 2/10/2026 6.50 % 14,369 14,242 14,022 (6)(20) First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 2/10/2026 — (59) (144) (6)(19)(20) First Lien Revolver, LIBOR+5.50% cash due 2/10/2026 — (13) (31) (6)(19)(20) 14,170 13,847 101 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes NeuAG, LLC Fertilizers & Agricultural Chemicals First Lien Term Loan, LIBOR+5.50% cash 7.00% PIK due 9/11/2024 7.00 % $ 35,306 $ 33,918 $ 33,894 (6)(20) First Lien Delayed Draw Term Loan, LIBOR+5.50% cash 7.00% PIK due 9/11/2024 — (175) (175) (6)(19)(20) 33,743 33,719 NuStar Logistics, L.P. Oil & Gas Refining & Marketing Unsecured Delayed Draw Term Loan, 12.00% cash due 4/19/2023 — — — (19)(20) — — Olaplex, Inc. Personal Products First Lien Term Loan, LIBOR+6.50% cash due 1/8/2026 7.50 % 35,056 34,441 35,056 (6)(20) First Lien Revolver, LIBOR+6.50% cash due 1/8/2025 7.50 % 1,917 1,852 1,917 (6)(19)(20) 36,293 36,973 OmniSYS Acquisition Corporation Diversified Support Services 100,000 Common Units in OSYS Holdings, LLC 1,000 607 (20) 1,000 607 Onvoy, LLC Integrated Telecommunication Services Second Lien Term Loan, LIBOR+10.50% cash due 2/10/2025 11.50 % 16,750 16,750 15,142 (6)(20) 19,666.67 Class A Units in GTCR Onvoy Holdings, LLC 1,967 268 (20) 13,664.73 Series 3 Class B Units in GTCR Onvoy Holdings, LLC — — (20) 18,717 15,410 OZLM Funding III, Ltd. Multi-Sector Holdings Class DR Notes, LIBOR+7.77% cash due 1/22/2029 8.03 % 2,312 1,657 2,119 (6)(11) 1,657 2,119 PaySimple, Inc. Data Processing & Outsourced Services First Lien Term Loan, LIBOR+5.50% cash due 8/23/2025 5.65 % 49,535 48,711 47,801 (6)(20) 48,711 47,801 Pingora MSR Opportunity Fund I-A, LP Thrifts & Mortgage Finance 1.86% limited partnership interest 938 353 (11)(16)(19) 938 353 PLATO Learning Inc. Education Services Unsecured Senior PIK Note, 8.50% PIK due 12/9/2021 3,099 2,434 — (15)(20) Unsecured Junior PIK Note, 10.00% PIK due 12/9/2021 15,010 10,227 — (15)(20) Unsecured Revolver, 5.00% cash due 12/9/2021 2,938 2,631 588 (20)(21) 126,127.80 Class A Common Units of Edmentum 126 — (20) 15,418 588 ProFrac Services, LLC Industrial Machinery First Lien Term Loan, LIBOR+7.50% cash due 9/15/2023 8.75 % 15,170 15,081 11,643 (6)(20) 15,081 11,643 Project Boost Purchaser, LLC Application Software Second Lien Term Loan, LIBOR+8.00% cash due 5/9/2027 8.15 % 3,750 3,750 3,375 (6)(20) 3,750 3,375 102 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Pug LLC Internet & Direct Marketing Retail First Lien Term Loan, LIBOR+8.00% cash due 2/12/2027 8.75 % $ 15,740 $ 14,802 $ 15,307 (6) 14,802 15,307 QuorumLabs, Inc. Application Software 64,887,669 Junior-2 Preferred Stock 375 — (20) 375 — Refac Optical Group Specialty Stores 1,550.9435 Shares of Common Stock in Refac Holdings, Inc. 1 — (20) 550.9435 Series A-2 Preferred Stock in Refac Holdings, Inc., 10% 305 — (20) 1,000 Series A-1 Preferred Stock in Refac Holdings, Inc., 10% 999 — (20) 1,305 — Salient CRGT, Inc. Aerospace & Defense First Lien Term Loan, LIBOR+6.50% cash due 2/28/2022 7.50 % 2,955 2,938 2,748 (6)(20) 2,938 2,748 Scilex Pharmaceuticals Inc. Pharmaceuticals Fixed Rate Zero Coupon Bond due 8/15/2026 15,585 12,069 12,468 (20) 12,069 12,468 ShareThis, Inc. Application Software 345,452 Series C Preferred Stock Warrants (exercise price $3.0395) expiration date 3/4/2024 367 — (20) 367 — Sorrento Therapeutics, Inc. Biotechnology 125,000 Common Stock Warrants (exercise price $3.94) expiration date 11/3/2029 — 1,123 (11)(20) — 1,123 Supermoose Borrower, LLC Application Software First Lien Term Loan, LIBOR+3.75% cash due 8/29/2025 3.90 % 10,196 8,925 9,193 (6) 8,925 9,193 Surgery Center Holdings, Inc. Health Care Facilities First Lien Term Loan, LIBOR+3.25% cash due 9/3/2024 4.25 % 3,850 3,133 3,640 (6)(11) 3,133 3,640 Swordfish Merger Sub LLC Auto Parts & Equipment Second Lien Term Loan, LIBOR+6.75% cash due 2/2/2026 7.75 % 12,500 12,458 10,563 (6)(20) 12,458 10,563 Tacala, LLC Restaurants Second Lien Term Loan, LIBOR+7.50% cash due 2/4/2028 7.65 % 7,276 7,167 6,903 (6) 7,167 6,903 TerSera Therapeutics LLC Pharmaceuticals Second Lien Term Loan, LIBOR+9.50% cash due 3/30/2024 10.50 % 29,663 29,236 29,371 (6)(20) 668,879 Common Units of TerSera Holdings LLC 2,192 3,487 (20) 31,428 32,858 TIBCO Software Inc. Application Software Second Lien Term Loan, LIBOR+7.25% cash due 3/3/2028 7.40 % 15,000 14,925 14,766 (6) 14,925 14,766 TigerConnect, Inc. Application Software 299,110 Series B Preferred Stock Warrants (exercise price $1.3373) expiration date 12/8/2024 60 525 (20) 60 525 Transact Holdings Inc. Application Software First Lien Term Loan, LIBOR+4.75% cash due 4/30/2026 4.90 % 6,930 6,826 6,553 (6)(20) 6,826 6,553 103 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Truck Hero, Inc. Auto Parts & Equipment Second Lien Term Loan, LIBOR+8.25% cash due 4/21/2025 9.25 % $ 21,500 $ 21,191 $ 20,819 (6)(20) 21,191 20,819 U.S. Renal Care, Inc. Health Care Services First Lien Term Loan, LIBOR+5.00% cash due 6/26/2026 5.15 % 1,122 934 1,096 (6) 934 1,096 Uniti Group Inc. Specialized REITs 21,072 Common Units — 133 222 (11)(12) 133 222 Verscend Holding Corp. Health Care Technology First Lien Term Loan, LIBOR+4.50% cash due 8/27/2025 4.65 % 14,525 14,479 14,429 (6) Fixed Rate Bond, 9.75% cash due 8/15/2026 7,000 7,020 7,629 21,499 22,058 Vertex Aerospace Services Corp. Aerospace & Defense First Lien Term Loan, LIBOR+4.50% cash due 6/29/2025 4.65 % 10,168 10,133 10,073 (6) 10,133 10,073 Vitalyst Holdings, Inc. IT Consulting & Other Services 675 Series A Preferred Stock Units 675 440 (20) 7,500 Class A Common Stock Units 75 — (20) 750 440 William Morris Endeavor Entertainment, LLC Movies & Entertainment First Lien Term Loan, LIBOR+8.50% cash due 5/18/2025 9.50 % 33,298 31,594 33,298 (6)(20) 31,594 33,298 Windstream Services II, LLC Integrated Telecommunication Services First Lien Term Loan, LIBOR+6.25% cash due 9/21/2027 7.25 % 25,935 24,900 25,168 (6) 6,129 Shares of Common Stock in Windstream Holdings II, LLC 53 69 (20) 37,215 Warrants in Windstream Holdings II, LLC 913 444 (20) 25,866 25,681 WP CPP Holdings, LLC Aerospace & Defense Second Lien Term Loan, LIBOR+7.75% cash due 4/30/2026 8.75 % 15,000 14,893 11,700 (6)(20) 14,893 11,700 WPEngine, Inc. Application Software First Lien Term Loan, LIBOR+6.50% cash due 3/27/2026 7.50 % 14,188 13,863 13,949 (6)(20) First Lien Delayed Draw Term Loan, LIBOR+6.50% cash due 3/27/2026 — (602) (443) (6)(19)(20) 13,261 13,506 xMatters, Inc. Application Software 600,000 Common Stock Warrants (exercise price $0.593333) expiration date 2/26/2025 709 336 (20) 709 336 Zep Inc. Specialty Chemicals First Lien Term Loan, LIBOR+4.00% cash due 8/12/2024 5.00 % 1,955 1,895 1,845 (6) Second Lien Term Loan, LIBOR+8.25% cash due 8/11/2025 9.25 % 30,000 29,908 24,180 (6)(20) 31,803 26,025 Zephyr Bidco Limited Specialized Finance Second Lien Term Loan, UK LIBOR+7.50% cash due 7/23/2026 7.55 % £ 18,000 23,705 21,176 (6)(11) 23,705 21,176 Total Non-Control/Non-Affiliate Investments (149.3% of net assets) $ 1,415,669 $ 1,365,957 104 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) Portfolio Company/Type of Investment (1)(2)(3)(4)(5) Cash Interest Rate (6) Industry Principal (7) Cost Fair Value Notes Total Portfolio Investments (172.0% of net assets) $ 1,669,170 $ 1,573,851 Cash and Cash Equivalents JP Morgan Prime Money Market Fund, Institutional Shares $ 35,248 $ 35,248 Other cash accounts 3,848 3,848 Total Cash and Cash Equivalents (4.3% of net assets) $ 39,096 $ 39,096 Total Portfolio Investments and Cash and Cash Equivalents (176.3% of net assets) $ 1,708,266 $ 1,612,947 Derivative Instrument Notional Amount to be Purchased Notional Amount to be Sold Maturity Date Counterparty Cumulative Unrealized Appreciation /(Depreciation) Foreign currency forward contract $ 35,577 £ 27,494 11/12/2020 JPMorgan Chase Bank, N.A. $ 25 Foreign currency forward contract $ 30,260 € 25,614 11/12/2020 JPMorgan Chase Bank, N.A. 198 $ 223 105 Oaktree Specialty Lending Corporation Consolidated Schedule of Investments September 30, 2020 (dollar amounts in thousands) (1) All debt investments are income producing unless otherwise noted. All equity investments are non-income producing unless otherwise noted. (2) See Note 3 in the accompanying notes to the Consolidated Financial Statements for portfolio composition by geographic region. (3) Equity ownership may be held in shares or units of companies related to the portfolio companies. (4) Interest rates may be adjusted from period to period on certain term loans and revolvers. These rate adjustments may be either temporary in nature due to tier pricing arrangements or financial or payment covenant violations in the original credit agreements or permanent in nature per loan amendment or waiver documents. (5) Each of the Company's investments is pledged as collateral under the Syndicated Facility (as defined in Note 6 to the accompanying notes to the Consolidated Financial Statements). (6) The interest rate on the principal balance outstanding for all floating rate loans is indexed to LIBOR and/or an alternate base rate (e.g., prime rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan. For each of these loans, the Company has provided the applicable margin over LIBOR or the alternate base rate based on each respective credit agreement and the cash interest rate as of period end. All LIBOR shown above is in U.S. dollars unless otherwise noted. As of September 30, 2020, the reference rates for the Company's variable rate loans were the 30-day LIBOR at 0.15%, the 60-day LIBOR at 0.19%, the 90-day LIBOR at 0.22%, the 180-day LIBOR at 0.27%, the 360-day LIBOR at 0.37%, the PRIME at 3.25%, the 30-day UK LIBOR at 0.05%, the 180-day UK LIBOR at 0.22%, the 30-day EURIBOR at (0.57)% and the 180-day EURIBOR at (0.36)%. Most loans include an interest floor, which generally ranges from 0% to 1%. (7) Principal includes accumulated PIK interest and is net of repayments, if any. “£” signifies the investment is denominated in British Pounds. "€" signifies the investment is denominated in Euros. All other investments are denominated in U.S. dollars. (8) Control Investments generally are defined by the Investment Company Act as investments in companies in which the Company owns more than 25% of the voting securities or maintains greater than 50% of the board representation. (9) As defined in the Investment Company Act, the Company is deemed to be both an "Affiliated Person" of and to "Control" these portfolio companies as the Company owns more than 25% of the portfolio company's outstanding voting securities or has the power to exercise control over management or policies of such portfolio company (including through a management agreement). See Schedule 12-14 in the accompanying notes to the Consolidated Financial Statements for transactions during the year ended September 30, 2020 in which the issuer was both an Affiliated Person and a portfolio company that the Company is deemed to control. (10) First Star Speir Aviation 1 Limited is a wholly-owned holding company formed by the Company in order to facilitate its investment strategy. In accordance with ASU 2013-08, the Company has deemed the holding company to be an investment company under GAAP and therefore deemed it appropriate to consolidate the financial results and financial position of the holding company and to recognize dividend income versus a combination of interest income and dividend income. Accordingly, the debt and equity investments in the wholly-owned holding company are disregarded for accounting purposes since the economic substance of these instruments are equity investments in the operating entities. (11) Investment is not a "qualifying asset" as defined under Section 55(a) of the Investment Company Act. Under the Investment Company Act, the Company may not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of the Company's total assets. As of September 30, 2020, qualifying assets represented 75.4% of the Company's total assets and non-qualifying assets represented 24.6% of the Company's total assets. (12) Income producing through payment of dividends or distributions. (13) PIK interest income for this investment accrues at an annualized rate of 15%, however, the PIK interest is not contractually capitalized on the investment. As a result, the principal amount of the investment does not increase over time for accumulated PIK interest. As of September 30, 2020, the accumulated PIK interest balance for each of the A notes and the B notes was $4.3 million. The fair value of this investment is inclusive of PIK. (14) See Note 3 in the accompanying notes to the Consolidated Financial Statements for portfolio composition. (15) This investment was on PIK non-accrual status as of September 30, 2020. PIK non-accrual status is inclusive of other non-cash income, where applicable. (16) This investment was valued using net asset value as a practical expedient for fair value. Consistent with ASC 820, these investments are excluded from the hierarchical levels. (17) Affiliate Investments generally are defined by the Investment Company Act as investments in companies in which the Company owns between 5% and 25% of the voting securities. (18) Non-Control/Non-Affiliate Investments are investments that are neither Control Investments nor Affiliate Investments. (19) Investment had undrawn commitments. Unamortized fees are classified as unearned income which reduces cost basis, which may result in a negative cost basis. A negative fair value may result from the unfunded commitment being valued below par. (20) As of September 30, 2020, these investments were categorized as Level 3 within the fair value hierarchy established by ASC 820. (21) This investment was on cash non-accrual status as of September 30, 2020. Cash non-accrual status is inclusive of PIK and other non-cash income, where applicable. See notes to Consolidated Financial Statements. 106 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Note 1. Organization Oaktree Specialty Lending Corporation (together with its consolidated subsidiaries, the "Company") is a specialty finance company that looks to provide customized, one-stop credit solutions to companies with limited access to public or syndicated capital markets. The Company was formed in late 2007 and operates as a closed-end, externally managed, non-diversified management investment company that has elected to be regulated as a Business Development Company under the Investment Company Act. The Company has qualified and elected to be treated as a regulated investment company ("RIC") under the Internal Revenue Code of 1986, as amended (the "Code"), for U.S. federal income tax purposes. The Company's investment objective is to generate current income and capital appreciation by providing companies with flexible and innovative financing solutions, including first and second lien loans, unsecured and mezzanine loans, bonds, preferred equity and certain equity co-investments. The Company may also seek to generate capital appreciation and income through secondary investments at discounts to par in either private or syndicated transactions. The Company is externally managed by Oaktree Fund Advisors, LLC ("Oaktree"), a subsidiary of Oaktree Capital Group, LLC (“OCG”), pursuant to an investment advisory agreement between the Company and Oaktree (as amended and restated, the "Investment Advisory Agreement"). Oaktree is an affiliate of Oaktree Capital Management, L.P. ("OCM"), the Company's external investment adviser from October 17, 2017 through May 3, 2020 and also a subsidiary of OCG. Oaktree Fund Administration, LLC ("Oaktree Administrator"), a subsidiary of OCM, provides certain administrative and other services necessary for the Company to operate pursuant to an administration agreement between the Company and Oaktree Administrator (the "Administration Agreement"). See Note 11. In 2019, Brookfield Asset Management Inc. ("Brookfield") acquired a majority economic interest in OCG. OCG operates as an independent business within Brookfield, with its own product offerings and investment, marketing and support teams. On March 19, 2021, the Company acquired Oaktree Strategic Income Corporation (“OCSI”), pursuant to that certain Agreement and Plan of Merger (the “Merger Agreement”), dated as of October 28, 2020, by and among OCSI, the Company, Lion Merger Sub, Inc., a wholly-owned subsidiary of the Company (“Merger Sub”), and, solely for the limited purposes set forth therein, Oaktree. Pursuant to the Merger Agreement, Merger Sub was first merged with and into OCSI, with OCSI as the surviving corporation (the “Merger”), and, immediately following the Merger, OCSI was then merged with and into the Company, with the Company as the surviving company (together with the Merger, the “Mergers”). In accordance with the terms of the Merger Agreement, at the effective time of the Merger, each outstanding share of OCSI’s common stock was converted into the right to receive 1.3371 shares of the Company’s common stock (with OCSI’s stockholders receiving cash in lieu of fractional shares of the Company’s common stock). As a result of the Mergers, the Company issued an aggregate of 39,400,011 shares of its common stock to former OCSI stockholders. See Note 15. "Merger with OCSI". Note 2. Significant Accounting Policies Basis of Presentation: The Consolidated Financial Statements of the Company have been prepared in accordance with GAAP and pursuant to the requirements for reporting on Form 10-K and Regulation S-X. All intercompany balances and transactions have been eliminated. The Company is an investment company following the accounting and reporting guidance in ASC Topic 946, Financial Services - Investment Companies ("ASC 946"). Use of Estimates: The preparation of the financial statements in conformity with GAAP requires management to make certain estimates and assumptions affecting amounts reported in the financial statements and accompanying notes. These estimates are based on the information that is currently available to the Company and on various other assumptions that the Company believes to be reasonable under the circumstances. Changes in the economic and political environments, financial markets and any other parameters used in determining these estimates could cause actual results to differ and such differences could be material. Significant estimates include the valuation of investments and revenue recognition. Consolidation: The accompanying Consolidated Financial Statements include the accounts of Oaktree Specialty Lending Corporation and its consolidated subsidiaries. Each consolidated subsidiary is wholly-owned and, as such, consolidated into the Consolidated Financial Statements. Certain subsidiaries that hold investments are treated as pass through entities for U.S. federal income tax purposes. The assets of certain of the consolidated subsidiaries are not directly available to satisfy the claims of the creditors of Oaktree Specialty Lending Corporation or any of its other subsidiaries. 107 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) As an investment company, portfolio investments held by the Company are not consolidated into the Consolidated Financial Statements but rather are included on the Statements of Assets and Liabilities as investments at fair value. Fair Value Measurements: The Company values its investments in accordance with ASC 820, which defines fair value as the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A liability's fair value is defined as the amount that would be paid to transfer the liability to a new obligor, not the amount that would be paid to settle the liability with the creditor. ASC 820 prioritizes the use of observable market prices over entity-specific inputs. Where observable prices or inputs are not available or reliable, valuation techniques are applied. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the investments or market and the investments' complexity. Hierarchical levels, defined by ASC 820 and directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities, are as follows: • Level 1 — Unadjusted, quoted prices in active markets for identical assets or liabilities as of the measurement date. • Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data at the measurement date for substantially the full term of the assets or liabilities. • Level 3 — Unobservable inputs that reflect management's best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. If inputs used to measure fair value fall into different levels of the fair value hierarchy, an investment's level is based on the lowest level of input that is significant to the fair value measurement. The Company's assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the investment. This includes investment securities that are valued using "bid" and "ask" prices obtained from independent third party pricing services or directly from brokers. These investments may be classified as Level 3 because the quoted prices may be indicative in nature for securities that are in an inactive market, may be for similar securities or may require adjustments for investment-specific factors or restrictions. Financial instruments with readily available quoted prices generally will have a higher degree of market price observability and a lesser degree of judgment inherent in measuring fair value. As such, Oaktree obtains and analyzes readily available market quotations provided by pricing vendors and brokers for all of the Company's investments for which quotations are available. In determining the fair value of a particular investment, pricing vendors and brokers use observable market information, including both binding and non-binding indicative quotations. The Company seeks to obtain at least two quotations for the subject or similar securities, typically from pricing vendors. If the Company is unable to obtain two quotes from pricing vendors, or if the prices obtained from pricing vendors are not within the Company's set threshold, the Company seeks to obtain a quote directly from a broker making a market for the asset. Oaktree evaluates the quotations provided by pricing vendors and brokers based on available market information, including trading activity of the subject or similar securities, or by performing a comparable security analysis to ensure that fair values are reasonably estimated. Oaktree also performs back-testing of valuation information obtained from pricing vendors and brokers against actual prices received in transactions. In addition to ongoing monitoring and back-testing, Oaktree performs due diligence procedures over pricing vendors to understand their methodology and controls to support their use in the valuation process. Generally, the Company does not adjust any of the prices received from these sources. If the quotations obtained from pricing vendors or brokers are determined to not be reliable or are not readily available, the Company values such investments using any of three different valuation techniques. The first valuation technique is the transaction precedent technique, which utilizes recent or expected future transactions of the investment to determine fair value, to the extent applicable. The second valuation technique is an analysis of the enterprise value ("EV") of the portfolio company. EV means the entire value of the portfolio company to a market participant, including the sum of the values of debt and equity securities used to capitalize the enterprise at a point in time. The EV analysis is typically performed to determine (i) the value of equity investments, (ii) whether there is credit impairment for debt investments and (iii) the value for debt investments that the Company is deemed to control under the Investment Company Act. To estimate the EV of a portfolio company, Oaktree analyzes various factors, including the portfolio company’s historical and projected financial results, macroeconomic impacts on the company and competitive dynamics in the company’s industry. Oaktree also utilizes some or all of the following information based on the individual circumstances of the portfolio company: (i) valuations of comparable public companies, (ii) recent sales of private and public comparable companies in similar industries or having similar business or earnings characteristics, (iii) purchase prices as a multiple of their earnings or cash flow, (iv) the portfolio company’s ability to meet its 108 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) forecasts and its business prospects, (v) a discounted cash flow analysis, (vi) estimated liquidation or collateral value of the portfolio company's assets and (vii) offers from third parties to buy the portfolio company. The Company may probability weight potential sale outcomes with respect to a portfolio company when uncertainty exists as of the valuation date. The third valuation technique is a market yield technique, which is typically performed for non-credit impaired debt investments. In the market yield technique, a current price is imputed for the investment based upon an assessment of the expected market yield for a similarly structured investment with a similar level of risk, and the Company considers the current contractual interest rate, the capital structure and other terms of the investment relative to risk of the company and the specific investment. A key determinant of risk, among other things, is the leverage through the investment relative to the EV of the portfolio company. As debt investments held by the Company are substantially illiquid with no active transaction market, the Company depends on primary market data, including newly funded transactions and industry specific market movements, as well as secondary market data with respect to high yield debt instruments and syndicated loans, as inputs in determining the appropriate market yield, as applicable. In accordance with ASC 820-10, certain investments that qualify as investment companies in accordance with ASC 946 may be valued using net asset value as a practical expedient for fair value. Consistent with FASB guidance under ASC 820, these investments are excluded from the hierarchical levels. These investments are generally not redeemable. The Company estimates the fair value of certain privately held warrants using a Black Scholes pricing model, which includes an analysis of various factors and subjective assumptions, including the current stock price (by using an EV analysis as described above), the expected period until exercise, expected volatility of the underlying stock price, expected dividends and the risk free rate. Changes in the subjective input assumptions can materially affect the fair value estimates. The Company's Board of Directors undertakes a multi-step valuation process each quarter in connection with determining the fair value of the Company's investments: • The quarterly valuation process begins with each portfolio company or investment being initially valued by Oaktree's valuation team in conjunction with Oaktree's portfolio management team and investment professionals responsible for each portfolio investment; • Preliminary valuations are then reviewed and discussed with management of Oaktree; • Separately, independent valuation firms engaged by the Board of Directors prepare valuations of the Company's investments, on a selected basis, for which market quotations are not readily available or are readily available but deemed not reflective of the fair value of the investment, and submit the reports to the Company and provide such reports to Oaktree and the Audit Committee of the Board of Directors; • Oaktree compares and contrasts its preliminary valuations to the valuations of the independent valuation firms and prepares a valuation report for the Audit Committee; • The Audit Committee reviews the preliminary valuations with Oaktree, and Oaktree responds and supplements the preliminary valuations to reflect any discussions between Oaktree and the Audit Committee; • The Audit Committee makes a recommendation to the full Board of Directors regarding the fair value of the investments in the Company's portfolio; and • The Board of Directors discusses valuations and determines the fair value of each investment in the Company's portfolio. The fair value of the Company's investments as of September 30, 2021 and September 30, 2020 was determined in good faith by the Board of Directors. The Board of Directors has and will continue to engage independent valuation firms to provide assistance regarding the determination of the fair value of a portion of the Company's portfolio securities for which market quotations are not readily available or are readily available but deemed not reflective of the fair value of the investment each quarter, and the Board of Directors may reasonably rely on that assistance. However, the Board of Directors is responsible for the ultimate valuation of the portfolio investments at fair value as determined in good faith pursuant to the Company's valuation policy and a consistently applied valuation process. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the fair value of the Company’s investments may fluctuate from period to period. Because of the inherent uncertainty of valuation, these estimated values may differ significantly from the values that would have been reported had a ready market for the investments existed, and it is reasonably possible that the difference could be material. With the exception of the line items entitled "deferred financing costs," "deferred offering costs," "other assets," "deferred tax asset, net," "credit facilities payable" and "unsecured notes payable," which are reported at amortized cost, all assets and liabilities approximate fair value on the Consolidated Statements of Assets and Liabilities. The carrying value of the line items titled "interest, dividends and fees receivable," "due from portfolio companies," "receivables from unsettled transactions," "due 109 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) from broker," "accounts payable, accrued expenses and other liabilities," "base management fee and incentive fee payable," "due to affiliate," "interest payable" and "payables from unsettled transactions" approximate fair value due to their short maturities. Foreign Currency Translation: The accounting records of the Company are maintained in U.S. dollars. All assets and liabilities denominated in foreign currencies are translated into U.S. dollars based on the prevailing foreign exchange rate on the reporting date. The Company does not isolate that portion of the results of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held. The Company’s investments in foreign securities may involve certain risks, including foreign exchange restrictions, expropriation, taxation or other political, social or economic risks, all of which could affect the market and/or credit risk of the investment. In addition, changes in the relationship of foreign currencies to the U.S. dollar can significantly affect the value of these investments and therefore the earnings of the Company. Derivative Instruments: Foreign Currency Forward Contracts The Company uses foreign currency forward contracts to reduce the Company's exposure to fluctuations in the value of foreign currencies. In a foreign currency forward contract, the Company agrees to receive or deliver a fixed quantity of one currency for another at a pre-determined price at a future date. Foreign currency forward contracts are marked-to-market at the applicable forward rate. Unrealized appreciation (depreciation) on foreign currency forward contracts are recorded within derivative assets or derivative liabilities on the Consolidated Statements of Assets and Liabilities by counterparty on a net basis, not taking into account collateral posted which is recorded separately, if applicable. Purchases and settlements of foreign currency forward contracts having the same settlement date and counterparty are generally settled net and any realized gains or losses are recognized on the settlement date. The Company does not utilize hedge accounting with respect to foreign currency forward contracts and as such, the Company recognizes its foreign currency forward contracts at fair value with changes included in the net unrealized appreciation (depreciation) on the Consolidated Statements of Operations. Interest Rate Swaps The Company uses an interest rate swap to hedge some of the Company's fixed rate debt. The Company designated the interest rate swap as the hedging instrument in an effective hedge accounting relationship, and therefore the periodic payments are recognized as components of interest expense in the Consolidated Statements of Operations. Depending on the nature of the balance at period end, the fair value of the interest rate swap is either included as a derivative asset or derivative liability on the Company's Consolidated Statements of Assets and Liabilities. The change in fair value of the interest rate swap is offset by a change in the carrying value of the fixed rate debt. Any amounts paid to the counterparty to cover collateral obligations under the terms of the interest rate swap agreement are included in due from broker on the Company's Consolidated Statements of Assets and Liabilities. Secured Borrowings: Securities sold and simultaneously repurchased at a premium are reported as financing transactions in accordance with FASB ASC Topic 860, Transfers and Servicing ("ASC 860"). Amounts payable to the counterparty are due on the repurchase settlement date and, excluding accrued interest, such amounts are presented in the accompanying Statements of Assets and Liabilities as secured borrowings. Premiums payable are separately reported as accrued interest. Investment Income: Interest Income Interest income, adjusted for accretion of original issue discount ("OID"), is recorded on an accrual basis to the extent that such amounts are expected to be collected. The Company stops accruing interest on investments when it is determined that interest is no longer collectible. Investments that are expected to pay regularly scheduled interest in cash are generally placed on non-accrual status when there is reasonable doubt that principal or interest cash payments will be collected. Cash interest payments received on investments may be recognized as income or a return of capital depending upon management’s judgment. 110 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) A non-accrual investment is restored to accrual status if past due principal and interest are paid in cash and the portfolio company, in management’s judgment, is likely to continue timely payment of its remaining obligations. In connection with its investment in a portfolio company, the Company sometimes receives nominal cost equity that is valued as part of the negotiation process with the portfolio company. When the Company receives nominal cost equity, the Company allocates its cost basis in the investment between debt securities and the nominal cost equity at the time of origination. Any resulting discount from recording the loan, or otherwise purchasing a security at a discount, is accreted into interest income over the life of the loan. For the Company's secured borrowings, the interest earned on the entire loan balance is recorded within interest income and the interest earned by the counterparty is recorded within interest expense in the Consolidated Statements of Operations. PIK Interest Income The Company's investments in debt securities may contain PIK interest provisions. PIK interest, which generally represents contractually deferred interest added to the loan balance that is generally due at the end of the loan term, is generally recorded on the accrual basis to the extent such amounts are expected to be collected. The Company generally ceases accruing PIK interest if there is insufficient value to support the accrual or if the Company does not expect the portfolio company to be able to pay all principal and interest due. The Company's decision to cease accruing PIK interest on a loan or debt security involves subjective judgments and determinations based on available information about a particular portfolio company, including whether the portfolio company is current with respect to its payment of principal and interest on its loans and debt securities; financial statements and financial projections for the portfolio company; the Company's assessment of the portfolio company's business development success; information obtained by the Company in connection with periodic formal update interviews with the portfolio company's management and, if appropriate, the private equity sponsor; and information about the general economic and market conditions in which the portfolio company operates. The Company's determination to cease accruing PIK interest is generally made well before the Company's full write-down of a loan or debt security. In addition, if it is subsequently determined that the Company will not be able to collect any previously accrued PIK interest, the fair value of the loans or debt securities would be reduced by the amount of such previously accrued, but uncollectible, PIK interest. The accrual of PIK interest on the Company’s debt investments increases the recorded cost bases of these investments in the Consolidated Financial Statements including for purposes of computing the capital gains incentive fee payable by the Company to Oaktree. To maintain its status as a RIC, certain income from PIK interest may be required to be distributed to the Company’s stockholders, even though the Company has not yet collected the cash and may never do so. Fee Income Oaktree or its affiliates may provide financial advisory services to portfolio companies and, in return, the Company may receive fees for capital structuring services. These fees are generally nonrecurring and are recognized by the Company upon the investment closing date. The Company may also receive additional fees in the ordinary course of business, including servicing, amendment and prepayment fees, which are classified as fee income and recognized as they are earned or the services are rendered. The Company has also structured exit fees across certain of its portfolio investments to be received upon the future exit of those investments. These fees are typically paid to the Company upon the earliest to occur of (i) a sale of the borrower or substantially all of the assets of the borrower, (ii) the maturity date of the loan or (iii) the date when full prepayment of the loan occurs. The receipt of such fees is contingent upon the occurrence of one of the events listed above for each of the investments. These fees are included in net investment income over the life of the loan. Dividend Income The Company generally recognizes dividend income on the ex-dividend date for public securities and the record date for private equity investments. Distributions received from private equity investments are evaluated to determine if the distribution should be recorded as dividend income or a return of capital. Generally, the Company will not record distributions from private equity investments as dividend income unless there are sufficient earnings at the portfolio company prior to the distribution. Distributions that are classified as a return of capital are recorded as a reduction in the cost basis of the investment. Cash and Cash Equivalents and Restricted Cash: Cash and cash equivalents consist of demand deposits and highly liquid investments with maturities of three months or less when acquired. The Company places its cash and cash equivalents and restricted cash with financial institutions and, at times, cash held in bank accounts may exceed the Federal Deposit Insurance Corporation ("FDIC") insurance limit. Cash and 111 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) cash equivalents are included on the Company's Consolidated Schedule of Investments and cash equivalents are classified as Level 1 assets. As of September 30, 2021, included in restricted cash was $2.3 million that was held at Wells Fargo Bank, N.A. in connection with the Citibank Facility (as defined in Note 6. Borrowings). Pursuant to the terms of the Citibank Facility, the Company was restricted in terms of access to $2.3 million until t he occurrence of the periodic distribution dates and, in connection therewith, the Company’s submission of its required periodic reporting schedules and verifications of the Company’s compliance with the terms of the Citibank Facility. Due from Portfolio Companies: Due from portfolio companies consists of amounts payable to the Company from its portfolio companies, including proceeds from the sale of portfolio companies not yet received or being held in escrow and excluding those amounts attributable to interest, dividends or fees receivable. These amounts are recognized as they become payable to the Company ( e.g. , principal payments on the scheduled amortization payment date). Receivables/Payables from Unsettled Transactions: Receivables/payables from unsettled transactions consist of amounts receivable to or payable by the Company for transactions that have not settled at the reporting date. Deferred Financing Costs: Deferred financing costs consist of fees and expenses paid in connection with the closing or amending of credit facilities and debt offerings. Deferred financing costs in connection with credit facilities are capitalized as an asset when incurred. Deferred financing costs in connection with all other debt arrangements are a direct deduction from the related debt liability when incurred. Deferred financing costs are amortized using the effective interest method over the term of the respective debt arrangement. This amortization expense is included in interest expense in the Company's Consolidated Statements of Operations. Upon early termination or modification of a credit facility, all or a portion of unamortized fees related to such facility may be accelerated into interest expense. For extinguishments of the Company’s unsecured notes payable, any unamortized deferred financing costs are deducted from the carrying amount of the debt in determining the gain or loss from the extinguishment. Deferred Offering Costs: Legal fees and other costs incurred in connection with the Company’s shelf registration statement are capitalized as deferred offering costs in the Consolidated Statements of Assets and Liabilities. To the extent any such costs relate to equity offerings, these costs are charged as a reduction of capital upon utilization. To the extent any such costs relate to debt offerings, these costs are treated as deferred financing costs and are amortized over the term of the respective debt arrangement. Any deferred offering costs that remain at the expiration of the shelf registration statement or when it becomes probable that an offering will not be completed are expensed. Income Taxes: The Company has elected to be subject to tax as a RIC under Subchapter M of the Code and operates in a manner so as to qualify for the tax treatment applicable to RICs. In order to be subject to tax as a RIC, among other things, the Company is required to meet certain source of income and asset diversification requirements and timely distribute dividends to its stockholders of an amount generally at least equal to 90% of investment company taxable income, as defined by the Code and determined without regard to any deduction for dividends paid, for each taxable year. As a RIC, the Company is not subject to U.S. federal income tax on the portion of its taxable income and gains distributed currently to stockholders as a dividend. Depending on the level of taxable income earned during a taxable year, the Company may choose to retain taxable income in excess of current year dividend distributions and would distribute such taxable income in the next taxable year. The Company would then incur a 4% excise tax on such income, as required. To the extent that the Company determines that its estimated current year annual taxable income, determined on a calendar year basis, could exceed estimated current calendar year dividend distributions, the Company accrues excise tax, if any, on estimated excess taxable income as taxable income is earned. The Company anticipates timely distribution of its taxable income within the tax rules under Subchapter M of the Code. The Company did not incur a U.S. federal excise tax for calendar years 2019 and 2020 and does not expect to incur a U.S. federal excise tax for calendar year 2021. The Company holds certain portfolio investments through taxable subsidiaries. The purpose of the Company's taxable subsidiaries is to permit the Company to hold equity investments in portfolio companies which are "pass through" entities for U.S. federal income tax purposes in order to comply with the RIC tax requirements. The taxable subsidiaries are consolidated 112 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) for financial reporting purposes, and portfolio investments held by them are included in the Company’s Consolidated Financial Statements as portfolio investments and recorded at fair value. The taxable subsidiaries are not consolidated with the Company for U.S. federal income tax purposes and may generate income tax expense, or benefit, and the related tax assets and liabilities, as a result of their ownership of certain portfolio investments. This income tax expense, if any, would be reflected in the Company's Consolidated Statements of Operations. The Company uses the liability method to account for its taxable subsidiaries' income taxes. Using this method, the Company recognizes deferred tax assets and liabilities for the estimated future tax effects attributable to temporary differences between financial reporting and tax bases of assets and liabilities. In addition, the Company recognizes deferred tax benefits associated with net operating loss carry forwards that it may use to offset future tax obligations. The Company measures deferred tax assets and liabilities using the enacted tax rates expected to apply to taxable income in the years in which it expects to recover or settle those temporary differences. FASB ASC Topic 740, Accounting for Uncertainty in Income Taxes ("ASC 740"), provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the Company's Consolidated Financial Statements. ASC 740 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Company's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold are recorded as a tax benefit or expense in the current year. Management's determinations regarding ASC 740 may be subject to review and adjustment at a later date based upon factors including an ongoing analysis of tax laws, regulations and interpretations thereof. The Company recognizes the tax benefits of uncertain tax positions only where the position is "more-likely-than-not" to be sustained assuming examination by tax authorities. Management has analyzed the Company's tax positions and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on returns filed for open tax years 2018, 2019 and 2020. The Company identifies its major tax jurisdictions as U.S. Federal and California, and the Company is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will change materially in the next 12 months. Note 3. Portfolio Investments As of September 30, 2021, 194.7% of net assets at fair value, or $2.6 billion, was invested in 138 portfolio companies, including (i) $133.9 million in subordinated notes and limited liability company ("LLC") equity interests of Senior Loan Fund JV I, LLC ("SLF JV I"), a joint venture through which the Company and Trinity Universal Insurance Company, a subsidiary of Kemper Corporation ("Kemper"), co-invest in senior secured loans of middle-market companies and other corporate debt securities and (ii) $55.6 million in subordinated notes and LLC equity interests of OCSI Glick JV LLC ("Glick JV" and, together with SLF JV I, the "JVs"), a joint venture through which the Company and GF Equity Funding 2014 LLC ("GF Equity Funding") co-invest primarily in senior secured loans of middle-market companies. As of September 30, 2021, 2.4% of net assets at fair value, or $31.6 million, was invested in cash and cash equivalents (including $2.3 million of restricted cash). In comparison, as of September 30, 2020, 172.0% of net assets at fair value, or $1.6 billion, was invested in 113 portfolio investments, including $117.4 million in subordinated notes and LLC equity interests of SLF JV I. As of September 30, 2020, 4.3% of net assets at fair value, or $39.1 million, was invested in cash and cash equivalents. As of September 30, 2021, 86.7% of the Company's portfolio at fair value consisted of senior secured debt investments and 7.6% consisted of subordinated debt investments, including the debt investments in the JVs. As of September 30, 2020, 84.1% of the Company's portfolio at fair value consisted of senior secured debt investments and 10.3% consisted of subordinated debt investments, including the debt investment in SLF JV I. The Company also held equity investments in certain of its portfolio companies consisting of common stock, preferred stock, warrants, limited partnership interests or LLC equity interests. These instruments generally do not produce a current return but are held for potential investment appreciation and capital gain. During the years ended September 30, 2021, 2020 and 2019, the Company recorded net realized gains (losses) of $26.4 million, $(13.9) million and $20.8 million, respectively. During the years ended September 30, 2021, 2020 and 2019, the Company recorded net unrealized appreciation (depreciation) of $114.5 million, $(20.6) million and $38.5 million, respectively. 113 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) The composition of the Company's investments as of September 30, 2021 and September 30, 2020 at cost and fair value was as follows: September 30, 2021 September 30, 2020 Cost Fair Value Cost Fair Value Investments in debt securities $ 2,222,223 $ 2,259,924 $ 1,422,487 $ 1,388,605 Investments in equity securities 120,621 107,222 101,111 67,806 Debt investments in the JVs 146,955 151,832 96,250 96,250 Equity investments in the JVs 49,322 37,651 49,322 21,190 Total $ 2,539,121 $ 2,556,629 $ 1,669,170 $ 1,573,851 The following table presents the composition of the Company's debt investments as of September 30, 2021 and September 30, 2020 at fixed rates and floating rates: September 30, 2021 September 30, 2020 Fair Value % of Debt Portfolio Fair Value % of Debt Portfolio Floating rate debt securities, including the debt investments in the JVs $ 2,205,648 91.45 % $ 1,311,509 88.33 % Fixed rate debt securities 206,108 8.55 173,346 11.67 Total $ 2,411,756 100.00 % $ 1,484,855 100.00 % The following table presents the financial instruments carried at fair value as of September 30, 2021 on the Company's Consolidated Statement of Assets and Liabilities for each of the three levels of hierarchy established by ASC 820: Level 1 Level 2 Level 3 Measured at Net Asset Value (a) Total Investments in debt securities (senior secured) $ — $ 338,707 $ 1,878,536 $ — $ 2,217,243 Investments in debt securities (subordinated, including the debt investments in the JVs) — 18,196 176,317 — 194,513 Investments in equity securities (preferred) — — 63,565 — 63,565 Investments in equity securities (common and warrants, including LLC equity interests of the JVs) 382 — 43,163 37,763 81,308 Total investments at fair value 382 356,903 2,161,581 37,763 2,556,629 Cash equivalents 23,600 — — — 23,600 Derivative assets — 1,912 — — 1,912 Total assets at fair value $ 23,982 $ 358,815 $ 2,161,581 $ 37,763 $ 2,582,141 Derivative liability $ — $ 2,108 $ — $ — $ 2,108 Total liabilities at fair value $ — $ 2,108 $ — $ — $ 2,108 __________ (a) In accordance with ASC 820-10, certain investments that are measured using the net asset value per share (or its equivalent) as a practical expedient for fair value have not been classified in the fair value hierarchy. These investments are generally not redeemable. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Consolidated Statements of Assets and Liabilities. 114 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) The following table presents the financial instruments carried at fair value as of September 30, 2020 on the Company's Consolidated Statement of Assets and Liabilities for each of the three levels of hierarchy established by ASC 820: Level 1 Level 2 Level 3 Measured at Net Asset Value (a) Total Investments in debt securities (senior secured) $ — $ 418,806 $ 904,237 $ — $ 1,323,043 Investments in debt securities (subordinated, including the debt investment in SLF JV I) — 35,660 126,152 — 161,812 Investments in equity securities (preferred) — — 29,959 — 29,959 Investments in equity securities (common and warrants, including LLC equity interests of SLF JV I) 222 — 35,080 23,735 59,037 Total investments at fair value 222 454,466 1,095,428 23,735 1,573,851 Cash equivalents 35,248 — — — 35,248 Derivative assets — 223 — — 223 Total assets at fair value $ 35,470 $ 454,689 $ 1,095,428 $ 23,735 $ 1,609,322 __________ (a) In accordance with ASC 820-10, certain investments that are measured using the net asset value per share (or its equivalent) as a practical expedient for fair value have not been classified in the fair value hierarchy. These investments are generally not redeemable. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the Consolidated Statements of Assets and Liabilities. When a determination is made to classify a financial instrument within Level 3 of the valuation hierarchy, the determination is based upon the fact that the unobservable factors are significant to the overall fair value measurement. However, Level 3 financial instruments typically have both unobservable or Level 3 components and observable components (i.e. components that are actively quoted and can be validated by external sources). Accordingly, the appreciation (depreciation) in the tables below includes changes in fair value due in part to observable factors that are part of the valuation methodology. Transfers between levels are recognized at the beginning of the reporting period. The following table provides a roll-forward in the changes in fair value from September 30, 2020 to September 30, 2021 for all investments for which the Company determined fair value using unobservable (Level 3) factors: Investments Senior Secured Debt Subordinated Debt (including debt investments in the JVs) Preferred Equity Common Equity and Warrants Total Fair value as of September 30, 2020 $ 904,237 $ 126,152 $ 29,959 $ 35,080 $ 1,095,428 Purchases (a) 1,237,783 66,537 27,692 5,665 1,337,677 Sales and repayments (352,237) (45,353) (31) (28,629) (426,250) Transfers in (b)(c)(d) 18,458 — — 6,759 25,217 Transfers out (b)(d) (6,228) — — — (6,228) PIK interest income 14,700 — — — 14,700 Accretion of OID 19,642 2,069 — — 21,711 Net unrealized appreciation (depreciation) 43,736 18,177 7,218 13,953 83,084 Net realized gains (losses) (1,555) 8,735 (1,273) 10,335 16,242 Fair value as of September 30, 2021 $ 1,878,536 $ 176,317 $ 63,565 $ 43,163 $ 2,161,581 Net unrealized appreciation (depreciation) relating to Level 3 investments still held as of September 30, 2021 and reported within net unrealized appreciation (depreciation) in the Consolidated Statement of Operations for the year ended September 30, 2021 $ 46,340 $ 4,857 $ 5,913 $ 13,763 $ 70,873 __________ (a) Includes the Level 3 investments acquired in connection with the Mergers during the year ended September 30, 2021. (b) There were transfers into/out of Level 3 from/to Level 2 for certain investments during the year ended September 30, 2021 as a result of a change in the number of market quotes available and/or a change in market liquidity. (c) There was a transfer into Level 3 from Level 2 as a result of an investment restructuring in which Level 2 senior secured debt was exchanged for Level 3 senior secured debt and common equity. 115 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) (d) There was one transfer from senior secured debt to common equity and warrants during the year ended September 30, 2021 as a result of an investment restructuring, in which $6.3 million of senior secured debt was exchanged for $6.3 million of common equity. The following table provides a roll-forward in the changes in fair value from September 30, 2019 to September 30, 2020 for all investments for which the Company determined fair value using unobservable (Level 3) factors: Investments Senior Secured Debt Subordinated Debt (including debt investment in SLF JV I) Preferred Equity Common Equity and Warrants Total Fair value as of September 30, 2019 $ 653,334 $ 110,309 $ 40,578 $ 41,006 $ 845,227 Purchases 423,545 50,534 — 1,485 475,564 Sales and repayments (207,898) (40,630) (1,388) (13,838) (263,754) Transfers in (a)(b) 67,939 5,113 — 19,229 92,281 Transfers out (a)(b) (33,625) (605) — — (34,230) PIK interest income 7,568 — — — 7,568 Accretion of OID 6,042 2,856 — — 8,898 Net unrealized appreciation (depreciation) 15,944 12,917 (9,726) (14,981) 4,154 Net realized gains (losses) (28,612) (14,342) 495 2,179 (40,280) Fair value as of September 30, 2020 $ 904,237 $ 126,152 $ 29,959 $ 35,080 $ 1,095,428 Net unrealized appreciation (depreciation) relating to Level 3 investments still held as of September 30, 2020 and reported within net unrealized appreciation (depreciation) in the Consolidated Statement of Operations for the year ended September 30, 2020 $ (11,757) $ 1,777 $ (9,125) $ (17,277) $ (36,382) __________ (a) There were transfers into/out of Level 3 from/to Level 2 for certain investments during the year ended September 30, 2020 as a result of a change in the number of market quotes available and/or a change in market liquidity. (b) There was a transfer from senior secured debt to common equity and warrants during the year ended September 30, 2020 as a result of an investment restructuring, in which $46.5 million of senior secured debt was exchanged for new senior secured debt of $27.9 million and common equity of $18.6 million. There was also a transfer from subordinated debt to common equity and warrants during the year ended September 30, 2020 as a result of an investment restructuring, in which $0.6 million of subordinated debt was exchanged for common equity and warrants. Significant Unobservable Inputs for Level 3 Investments The following table provides quantitative information related to the significant unobservable inputs for Level 3 investments, which are carried at fair value, as of September 30, 2021: Asset Fair Value Valuation Technique Unobservable Input Range Weighted Average (a) Senior Secured Debt $ 1,413,373 Market Yield Market Yield (b) 4.0% - 30.0% 10.4% 36,197 Enterprise Value EBITDA Multiple (c) 3.0x - 9.0x 4.5x 7,500 Enterprise Value Asset Multiple (c) 0.9x - 1.1x 1.0x 421,466 Broker Quotations Broker Quoted Price (e) N/A - N/A N/A Subordinated Debt 24,485 Market Yield Market Yield (b) 12.0% - 14.0% 12.6% Debt Investments in the JVs 151,832 Enterprise Value N/A (f) N/A - N/A N/A Preferred & Common Equity 6,188 Enterprise Value Revenue Multiple (c) 0.9x - 11.2x 2.5x 93,520 Enterprise Value EBITDA Multiple (c) 3.0x - 35.0x 15.9x 698 Enterprise Value Asset Multiple (c) 0.9x - 1.1x 1.0x 6,322 Transactions Precedent Transaction Price (d) N/A - N/A N/A Total $ 2,161,581 __________ (a) Weighted averages are calculated based on fair value of investments. (b) Used when market participants would take into account market yield when pricing the investment. (c) Used when market participants would use such multiples when pricing the investment. (d) Used when there is an observable transaction or pending event for the investment. 116 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) (e) The Company generally uses prices provided by an independent pricing service which are non-binding indicative prices on or near the valuation date as the primary basis for the fair value determinations for quoted senior secured debt investments. Since these prices are non-binding, they may not be indicative of fair value. The Company evaluates the quotations provided by pricing vendors and brokers based on available market information, including trading activity of the subject or similar securities, or by performing a comparable security analysis to ensure that fair values are reasonably estimated. Each quoted price is evaluated by the Audit Committee of the Company's Board of Directors in conjunction with additional information compiled by Oaktree. (f) The Company determined the value of its subordinated notes of each JV based on the total assets less the total liabilities senior to the subordinated notes held at such JV in an amount not exceeding par under the EV technique. The following table provides quantitative information related to the significant unobservable inputs for Level 3 investments, which are carried at fair value, as of September 30, 2020: Asset Fair Value Valuation Technique Unobservable Input Range Weighted Average (a) Senior Secured Debt $ 542,354 Market Yield Market Yield (b) 6.6% - 30.0% 12.5% 35,508 Enterprise Value EBITDA Multiple (c) 0.6x - 6.3x 5.9x 11,510 Enterprise Value Asset Multiple (c) 0.9x - 1.1x 1.0x 314,865 Broker Quotations Broker Quoted Price (e) N/A - N/A N/A Subordinated Debt 29,314 Market Yield Market Yield (b) 4.8% - 15.0% 9.3% 588 Enterprise Value EBITDA Multiple (c) 7.6x - 8.6x 8.1x SLF JV I Debt Investment 96,250 Enterprise Value N/A (f) N/A - N/A N/A Preferred & Common Equity 16,470 Enterprise Value Revenue Multiple (c) 0.9x - 7.0x 3.1x 45,934 Enterprise Value EBITDA Multiple (c) 0.6x - 15.0x 7.6x 1,622 Enterprise Value Asset Multiple (c) 0.9x - 1.1x 1.0x 1,013 Transactions Precedent Transaction Price (d) N/A - N/A N/A Total $ 1,095,428 __________ (a) Weighted averages are calculated based on fair value of investments. (b) Used when market participants would take into account market yield when pricing the investment. (c) Used when market participants would use such multiples when pricing the investment. (d) Used when there is an observable transaction or pending event for the investment. (e) The Company generally uses prices provided by an independent pricing service which are non-binding indicative prices on or near the valuation date as the primary basis for the fair value determinations for quoted senior secured debt investments. Since these prices are non-binding, they may not be indicative of fair value. The Company evaluates the quotations provided by pricing vendors and brokers based on available market information, including trading activity of the subject or similar securities, or by performing a comparable security analysis to ensure that fair values are reasonably estimated. Each quoted price is evaluated by the Audit Committee of the Company's Board of Directors in conjunction with additional information compiled by Oaktree. (f) The Company determined the value of its subordinated notes of SLF JV I based on the total assets less the total liabilities senior to the subordinated notes held at SLF JV I in an amount not exceeding par under the EV technique. Under the market yield technique, the significant unobservable input used in the fair value measurement of the Company's investments in debt securities is the market yield. Increases or decreases in the market yield may result in a lower or higher fair value measurement, respectively. Under the EV technique, the significant unobservable input used in the fair value measurement of the Company's investments in debt or equity securities is the earnings before interest, taxes, depreciation and amortization ("EBITDA"), revenue or asset multiple, as applicable. Increases or decreases in the valuation multiples in isolation may result in a higher or lower fair value measurement, respectively. 117 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Financial Instruments Disclosed, But Not Carried, At Fair Value The following table presents the carrying value and fair value of the Company's financial liabilities disclosed, but not carried, at fair value as of September 30, 2021 and the level of each financial liability within the fair value hierarchy: Carrying Value Fair Value Level 1 Level 2 Level 3 Syndicated Facility payable $ 495,000 $ 495,000 $ — $ — $ 495,000 Citibank Facility payable 135,000 135,000 — — 135,000 2025 Notes payable (carrying value is net of unamortized financing costs and unaccreted discount) 295,740 314,541 — 314,541 — 2027 Notes payable (carrying value is net of unamortized financing costs, unaccreted discount and interest rate swap fair value adjustment) 343,003 351,134 — 351,134 — Total $ 1,268,743 $ 1,295,675 $ — $ 665,675 $ 630,000 The following table presents the carrying value and fair value of the Company's financial liabilities disclosed, but not carried, at fair value as of September 30, 2020 and the level of each financial liability within the fair value hierarchy: Carrying Value Fair Value Level 1 Level 2 Level 3 Syndicated Facility payable $ 414,825 $ 414,825 $ — $ — $ 414,825 2025 Notes payable (carrying value is net of unamortized financing costs and unaccreted discount) 294,490 301,431 — 301,431 — Total $ 709,315 $ 716,256 $ — $ 301,431 $ 414,825 The principal values of the credit facilities payable approximate fair value due to their variable interest rates and are included in Level 3 of the hierarchy. The Company used market quotes as of the valuation date to estimate the fair value of its 3.500% notes due 2025 (the "2025 Notes") and 2.700% notes due 2027 (the "2027 Notes"), which are included in Level 2 of the hierarchy. Portfolio Composition Summaries of the composition of the Company's portfolio at cost as a percentage of total investments and at fair value as a percentage of total investments and net assets are shown in the following tables: September 30, 2021 September 30, 2020 Cost: % of Total Investments % of Total Investments Senior secured debt $ 2,179,907 85.85 % $ 1,345,012 80.58 % Debt investments in the JVs 146,955 5.79 % 96,250 5.77 % Preferred equity 65,939 2.60 % 39,550 2.37 % Common equity and warrants 54,682 2.15 % 61,561 3.69 % LLC equity interests of the JVs 49,322 1.94 % 49,322 2.95 % Subordinated debt 42,316 1.67 % 77,475 4.64 % Total $ 2,539,121 100.00 % $ 1,669,170 100.00 % September 30, 2021 September 30, 2020 Fair Value: % of Total Investments % of Net Assets % of Total Investments % of Net Assets Senior secured debt $ 2,217,243 86.72 % 168.89 % $ 1,323,043 84.06 % 144.61 % Debt investments in the JVs 151,832 5.94 % 11.56 % 96,250 6.12 % 10.52 % Preferred equity 63,565 2.49 % 4.84 % 29,959 1.90 % 3.27 % Common equity and warrants 43,657 1.71 % 3.33 % 37,847 2.40 % 4.14 % Subordinated debt 42,681 1.67 % 3.25 % 65,562 4.17 % 7.17 % LLC equity interests of the JVs 37,651 1.47 % 2.87 % 21,190 1.35 % 2.32 % Total $ 2,556,629 100.00 % 194.74 % $ 1,573,851 100.00 % 172.03 % 118 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) The geographic composition is determined by the location of the corporate headquarters of the portfolio company, which may not be indicative of the primary source of the portfolio company's business. The following tables show the composition of the Company's portfolio by geographic region at cost as a percentage of total investments and at fair value as a percentage of total investments and net assets: September 30, 2021 September 30, 2020 Cost: % of Total Investments % of Total Investments Northeast $ 720,781 28.39 % $ 495,440 29.69 % Midwest 385,846 15.20 % 285,674 17.11 % West 365,471 14.39 % 330,468 19.80 % Southeast 294,339 11.59 % 171,330 10.26 % International 268,817 10.59 % 210,963 12.64 % Southwest 256,227 10.09 % 67,867 4.07 % South 156,764 6.17 % 72,150 4.32 % Northwest 90,876 3.58 % 35,278 2.11 % Total $ 2,539,121 100.00 % $ 1,669,170 100.00 % September 30, 2021 September 30, 2020 Fair Value: % of Total Investments % of Net Assets % of Total Investments % of Net Assets Northeast $ 721,647 28.24 % 54.97 % $ 446,499 28.38 % 48.81 % Midwest 382,475 14.96 % 29.13 % 252,482 16.04 % 27.60 % West 371,257 14.52 % 28.28 % 325,708 20.69 % 35.60 % Southeast 299,486 11.71 % 22.81 % 165,516 10.52 % 18.09 % International 275,904 10.79 % 21.02 % 213,741 13.58 % 23.36 % Southwest 258,940 10.13 % 19.72 % 65,647 4.17 % 7.18 % South 155,526 6.08 % 11.85 % 70,551 4.48 % 7.71 % Northwest 91,394 3.57 % 6.96 % 33,707 2.14 % 3.68 % Total $ 2,556,629 100.00 % 194.74 % $ 1,573,851 100.00 % 172.03 % 119 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) The following tables show the composition of the Company's portfolio by industry at cost as a percentage of total investments and at fair value as a percentage of total investments and net assets as of September 30, 2021 and September 30, 2020: September 30, 2021 September 30, 2020 Cost: % of Total Investments % of Total Investments Application Software $ 367,265 14.49 % $ 162,536 9.71 % Multi-Sector Holdings (1) 196,277 7.73 148,116 8.87 Pharmaceuticals 138,250 5.44 99,471 5.96 Data Processing & Outsourced Services 120,381 4.74 109,744 6.57 Biotechnology 111,856 4.41 89,447 5.36 Personal Products 103,642 4.08 50,091 3.00 Industrial Machinery 88,231 3.47 15,081 0.90 Health Care Services 84,750 3.34 71,139 4.26 Specialized Finance 68,554 2.70 51,909 3.11 Aerospace & Defense 67,629 2.66 27,964 1.68 Fertilizers & Agricultural Chemicals 66,713 2.63 33,743 2.02 Internet & Direct Marketing Retail 62,233 2.45 14,802 0.89 Construction & Engineering 61,874 2.44 13,277 0.80 Integrated Telecommunication Services 47,059 1.85 44,583 2.67 Internet Services & Infrastructure 46,917 1.85 28,631 1.72 Specialty Chemicals 46,731 1.84 44,786 2.68 Home Improvement Retail 46,487 1.83 — — Automotive Retail 41,800 1.65 — — Airport Services 41,699 1.64 22,376 1.34 Diversified Support Services 40,666 1.60 18,797 1.13 Real Estate Services 40,445 1.59 39,023 2.34 Oil & Gas Storage & Transportation 36,612 1.44 26,615 1.59 Oil & Gas Refining & Marketing 36,044 1.42 31,132 1.87 Soft Drinks 33,410 1.32 — — Electrical Components & Equipment 32,127 1.27 20,934 1.25 Health Care Supplies 29,650 1.17 21,660 1.30 Advertising 28,649 1.13 13,611 0.82 Real Estate Operating Companies 27,531 1.08 — — Cable & Satellite 26,730 1.05 — — Movies & Entertainment 26,002 1.02 44,691 2.68 Insurance Brokers 25,515 1.00 17,546 1.05 Leisure Facilities 25,162 0.99 1,887 0.11 Health Care Equipment 23,674 0.93 — — Independent Power Producers & Energy Traders 23,458 0.92 21,462 1.29 Airlines 22,417 0.88 10,535 0.63 Health Care Distributors 19,698 0.78 12,810 0.77 Commercial Printing 19,685 0.78 7,868 0.47 Home Furnishings 19,537 0.77 — — Managed Health Care 18,654 0.73 27,479 1.65 Metal & Glass Containers 17,443 0.69 11,273 0.68 Other Diversified Financial Services 16,104 0.63 113 0.01 Thrifts & Mortgage Finance 16,079 0.63 938 0.06 Health Care Technology 13,877 0.55 21,499 1.29 Auto Parts & Equipment 12,466 0.49 33,649 2.02 Electronic Components 10,080 0.40 25,600 1.53 Property & Casualty Insurance 9,884 0.39 47,995 2.88 Restaurants 9,317 0.37 10,248 0.61 IT Consulting & Other Services 7,598 0.30 14,919 0.89 Research & Consulting Services 7,354 0.29 24,837 1.49 Systems Software 6,647 0.26 20,694 1.24 Leisure Products 6,599 0.26 — — Alternative Carriers 6,578 0.26 — — Apparel, Accessories & Luxury Goods 5,165 0.20 13,734 0.82 Air Freight & Logistics 4,925 0.19 — — Integrated Oil & Gas 4,842 0.19 — — Food Distributors 4,625 0.18 — — Food Retail 3,745 0.15 6,851 0.41 Diversified Banks 3,515 0.14 — — Technology Distributors 3,163 0.12 — — Construction Materials 2,245 0.09 2,150 0.13 Housewares & Specialties 1,875 0.07 — — Education Services 981 0.04 22,926 1.37 General Merchandise Stores — — 19,220 1.15 Hotels, Resorts & Cruise Lines — — 15,378 0.92 Diversified Real Estate Activities — — 15,288 0.92 Trading Companies & Distributors — — 10,228 0.61 Oil & Gas Equipment & Services — — 3,313 0.20 Health Care Facilities — — 3,133 0.19 Specialty Stores — — 1,305 0.08 Specialized REITs — — 133 0.01 Total $ 2,539,121 100.00 % $ 1,669,170 100.00 % 120 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) September 30, 2021 September 30, 2020 Fair Value: % of Total Investments % of Net Assets % of Total Investments % of Net Assets Application Software $ 372,606 14.58 % 28.39 % $ 160,591 10.21 % 17.57 % Multi-Sector Holdings (1) 189,483 7.41 14.43 121,751 7.74 13.31 Pharmaceuticals 142,194 5.56 10.83 103,092 6.55 11.27 Data Processing & Outsourced Services 113,923 4.46 8.68 99,589 6.33 10.89 Biotechnology 113,641 4.44 8.66 96,624 6.14 10.56 Personal Products 105,530 4.13 8.04 51,024 3.24 5.58 Industrial Machinery 90,218 3.53 6.87 11,643 0.74 1.27 Health Care Services 84,735 3.31 6.45 59,925 3.81 6.55 Aerospace & Defense 69,602 2.72 5.30 24,521 1.56 2.68 Specialized Finance 68,844 2.69 5.24 48,425 3.08 5.29 Internet & Direct Marketing Retail 68,424 2.68 5.21 15,307 0.97 1.67 Fertilizers & Agricultural Chemicals 67,527 2.64 5.14 33,719 2.14 3.69 Construction & Engineering 63,109 2.47 4.81 13,465 0.86 1.47 Integrated Telecommunication Services 49,607 1.94 3.78 41,091 2.61 4.49 Internet Services & Infrastructure 47,923 1.87 3.65 26,587 1.69 2.91 Specialty Chemicals 46,559 1.82 3.55 39,008 2.48 4.26 Home Improvement Retail 46,488 1.82 3.54 — — — Automotive Retail 42,133 1.65 3.21 — — — Real Estate Services 41,225 1.61 3.14 37,723 2.40 4.12 Diversified Support Services 40,888 1.60 3.11 17,689 1.12 1.93 Airport Services 40,776 1.59 3.11 21,283 1.35 2.33 Oil & Gas Refining & Marketing 36,546 1.43 2.78 29,826 1.90 3.26 Oil & Gas Storage & Transportation 34,462 1.35 2.63 25,749 1.64 2.81 Soft Drinks 33,410 1.31 2.54 — — — Electrical Components & Equipment 32,142 1.26 2.45 20,465 1.30 2.24 Advertising 30,423 1.19 2.32 13,440 0.85 1.47 Health Care Supplies 30,186 1.18 2.30 21,634 1.37 2.36 Real Estate Operating Companies 28,341 1.11 2.16 — — — Insurance Brokers 27,612 1.08 2.10 18,083 1.15 1.98 Cable & Satellite 27,048 1.06 2.06 — — — Movies & Entertainment 27,048 1.06 2.06 43,592 2.77 4.76 Airlines 24,554 0.96 1.87 13,132 0.83 1.44 Health Care Equipment 23,763 0.93 1.81 — — — Independent Power Producers & Energy Traders 23,552 0.92 1.79 20,812 1.32 2.27 Leisure Facilities 22,888 0.90 1.74 — — — Commercial Printing 20,100 0.79 1.53 7,334 0.47 0.80 Home Furnishings 19,735 0.77 1.50 — — — Health Care Distributors 19,683 0.77 1.50 12,260 0.78 1.34 Managed Health Care 18,840 0.74 1.44 26,681 1.70 2.92 Metal & Glass Containers 17,413 0.68 1.33 11,833 0.75 1.29 Thrifts & Mortgage Finance 15,942 0.62 1.21 353 0.02 0.04 Other Diversified Financial Services 15,908 0.62 1.21 — — — Health Care Technology 13,960 0.55 1.06 22,058 1.40 2.41 Auto Parts & Equipment 12,365 0.48 0.94 31,382 1.99 3.43 Electronic Components 10,127 0.40 0.77 26,552 1.69 2.90 Property & Casualty Insurance 9,949 0.39 0.76 46,737 2.97 5.11 Restaurants 9,451 0.37 0.72 7,886 0.50 0.86 Research & Consulting Services 7,606 0.30 0.58 24,212 1.54 2.65 IT Consulting & Other Services 7,443 0.29 0.57 13,905 0.88 1.52 Alternative Carriers 6,939 0.27 0.53 — — — Systems Software 6,769 0.26 0.52 20,481 1.30 2.24 Leisure Products 6,599 0.26 0.50 49 — 0.01 Air Freight & Logistics 4,981 0.19 0.38 — — — Integrated Oil & Gas 4,884 0.19 0.37 — — — Food Distributors 4,673 0.18 0.36 — — — Food Retail 3,750 0.15 0.29 6,998 0.44 0.76 Diversified Banks 3,562 0.14 0.27 — — — Technology Distributors 3,178 0.12 0.24 — — — Construction Materials 2,350 0.09 0.18 2,073 0.13 0.23 Housewares & Specialties 2,003 0.08 0.15 — — — Education Services 1,009 0.04 0.08 7,088 0.45 0.77 Apparel, Accessories & Luxury Goods — — — 7,856 0.50 0.86 General Merchandise Stores — — — 17,877 1.14 1.95 Hotels, Resorts & Cruise Lines — — — 17,081 1.09 1.87 Diversified Real Estate Activities — — — 16,846 1.07 1.84 Trading Companies & Distributors — — — 10,069 0.64 1.10 Health Care Facilities — — — 3,640 0.23 0.40 Oil & Gas Equipment & Services — — — 2,588 0.16 0.28 Specialized REITs — — — 222 0.01 0.02 Total $ 2,556,629 100.00 % 194.74 % $ 1,573,851 100.00 % 172.03 % ___________________ (1) This industry includes the Company's investments in the JVs and certain limited partnership interests. 121 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) As of September 30, 2021 and September 30, 2020, the Company had no single investment that represented greater than 10% of the total investment portfolio at fair value. Income, consisting of interest, dividends, fees, other investment income and realization of gains or losses, may fluctuate and in any given period can be highly concentrated among several investments. Senior Loan Fund JV I, LLC In May 2014, the Company entered into an LLC agreement with Kemper to form SLF JV I. The Company co-invests in senior secured loans of middle-market companies and other corporate debt securities with Kemper through its investment in SLF JV I. SLF JV I is managed by a four person Board of Directors, two of whom are selected by the Company and two of whom are selected by Kemper. All portfolio decisions and investment decisions in respect of SLF JV I must be approved by the SLF JV I investment committee, which consists of one representative selected by the Company and one representative selected by Kemper (with approval from a representative of each required). Since the Company does not have a controlling financial interest in SLF JV I, the Company does not consolidate SLF JV I. SLF JV I is capitalized pro rata with LLC equity interests as transactions are completed and may be capitalized with additional subordinated notes issued to the Company and Kemper by SLF JV I. The subordinated notes issued by SLF JV I (the "SLF JV I Notes") are senior in right of payment to SLF JV I LLC equity interests and subordinated in right of payment to SLF JV I’s secured debt. As of September 30, 2021 and September 30, 2020, the Company and Kemper owned, in the aggregate, 87.5% and 12.5%, respectively, of the LLC equity interests of SLF JV I and the outstanding SLF JV I Notes. SLF JV I is not an "eligible portfolio company" as defined in section 2(a)(46) of the Investment Company Act. SLF JV I has a senior revolving credit facility with Deutsche Bank AG, New York Branch (as amended, the "SLF JV I Deutsche Bank Facility"), which permitted up to $260.0 million and $250.0 million of borrowings (subject to borrowing base and other limitations) as of September 30, 2021 and September 30, 2020, respectively. Borrowings under the SLF JV I Deutsche Bank Facility are secured by all of the assets of SLF JV I Funding LLC, a special purpose financing subsidiary of SLF JV I. As of September 30, 2021, the reinvestment period of the SLF JV I Deutsche Bank Facility was scheduled to expire May 3, 2023 and the maturity date for the SLF JV I Deutsche Bank Facility was May 3, 2028. As of September 30, 2021, borrowings under the SLF JV I Deutsche Bank Facility accrued interest at a rate equal to 3-month LIBOR plus 2.00% per annum during the reinvestment period, 3-month LIBOR plus 2.15% per annum for the first year after the reinvestment period, 3-month LIBOR plus 2.25% for the following year and plus 2.50% thereafter, in each case with a 0.125% LIBOR floor. Under the SLF JV I Deutsche Bank Facility, $215.6 million and $167.9 million of borrowings were outstanding as of September 30, 2021 and September 30, 2020, respectively. As of September 30, 2021 and September 30, 2020, SLF JV I had total assets of $379.2 million and $313.5 million, respectively. SLF JV I's portfolio primarily consisted of senior secured loans to 55 portfolio companies as of September 30, 2021 and September 30, 2020. The portfolio companies in SLF JV I are in industries similar to those in which the Company may invest directly. As of September 30, 2021, the Company's investment in SLF JV I consisted of LLC equity interests and SLF JV I Notes of $133.9 million in aggregate, at fair value. As of September 30, 2020, the Company's investment in SLF JV I consisted of LLC equity interests and SLF JV I Notes of $117.4 million in aggregate, at fair value. As of each of September 30, 2021 and September 30, 2020, the Company and Kemper had funded approximately $165.5 million to SLF JV I, of which $144.8 million was from the Company. As of September 30, 2021, the Company had aggregate commitments to fund SLF JV I of $35.0 million, of which approximately $26.2 million was to fund additional SLF JV I Notes and approximately $8.8 million was to fund LLC equity interests in SLF JV I. As of September 30, 2020, the Company had commitments to fund LLC equity interests in SLF JV I of $17.5 million, of which $1.3 million was unfunded. 122 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Below is a summary of SLF JV I's portfolio, followed by a listing of the individual loans in SLF JV I's portfolio as of September 30, 2021 and September 30, 2020: September 30, 2021 September 30, 2020 Senior secured loans (1) $344,196 $307,579 Weighted average interest rate on senior secured loans (2) 5.60% 5.44% Number of borrowers in SLF JV I 55 56 Largest exposure to a single borrower (1) $9,875 $10,487 Total of five largest loan exposures to borrowers (1) $46,984 $49,097 __________ (1) At principal amount. (2) Computed using the weighted average annual interest rate on accruing senior secured loans at fair value. 123 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) SLF JV I Portfolio as of September 30, 2021 Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes Access CIG, LLC First Lien Term Loan, LIBOR+3.75% cash due 2/27/2025 3.83 % Diversified Support Services $ 9,111 $ 9,084 $ 9,078 (4) ADB Companies, LLC First Lien Term Loan, LIBOR+6.25% cash due 12/18/2025 7.25 % Construction & Engineering 7,732 7,566 7,644 (4) Altice France S.A. First Lien Term Loan, LIBOR+4.00% cash due 8/14/2026 4.12 % Integrated Telecommunication Services 2,596 2,468 2,591 Alvogen Pharma US, Inc. First Lien Term Loan, LIBOR+5.25% cash due 12/31/2023 6.25 % Pharmaceuticals 9,755 9,580 9,443 (4) Amplify Finco Pty Ltd. First Lien Term Loan, LIBOR+4.25% cash due 11/26/2026 5.00 % Movies & Entertainment 7,880 7,801 7,680 (4) Anastasia Parent, LLC First Lien Term Loan, LIBOR+3.75% cash due 8/11/2025 3.88 % Personal Products 2,799 2,211 2,378 Apptio, Inc. First Lien Term Loan, LIBOR+7.25% cash due 1/10/2025 8.25 % Application Software 4,615 4,565 4,544 (4) Apptio, Inc. First Lien Revolver, LIBOR+7.25% cash due 1/10/2025 8.25 % Application Software 154 150 148 (4)(5) Total Apptio, Inc. 4,769 4,715 4,692 Asurion, LLC Second Lien Term Loan, LIBOR+5.25% cash due 1/20/2029 5.33 % Property & Casualty Insurance 6,000 5,940 5,980 Aurora Lux Finco S.À.R.L. First Lien Term Loan, LIBOR+6.00% cash due 12/24/2026 7.00 % Airport Services 6,403 6,283 6,025 (4) BAART Programs, Inc. First Lien Term Loan, LIBOR+5.00% cash due 6/11/2027 6.00 % Health Care Services 5,985 5,925 5,970 BAART Programs, Inc. First Lien Delayed Draw Term Loan, LIBOR+5.00% cash due 6/11/2027 6.00 % Health Care Services 450 436 446 (5) Total BAART Programs, Inc. 6,435 6,361 6,416 Blackhawk Network Holdings, Inc. First Lien Term Loan, LIBOR+3.00% cash due 6/15/2025 3.08 % Data Processing & Outsourced Services 9,675 9,662 9,615 Boxer Parent Company Inc. First Lien Term Loan, LIBOR+3.75% cash due 10/2/2025 3.88 % Systems Software 6,643 6,570 6,615 Brazos Delaware II, LLC First Lien Term Loan, LIBOR+4.00% cash due 5/21/2025 4.08 % Oil & Gas Equipment & Services 7,253 7,234 7,158 C5 Technology Holdings, LLC 171 Common Units Data Processing & Outsourced Services — — (4) C5 Technology Holdings, LLC 7,193,539.63 Preferred Units Data Processing & Outsourced Services 7,194 5,683 (4) Total C5 Technology Holdings, LLC 7,194 5,683 Centerline Communications, LLC First Lien Term Loan, LIBOR+5.50% cash due 8/10/2027 6.50 % Wireless Telecommunication Services 2,000 1,961 1,960 Centerline Communications, LLC First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 8/10/2023 6.50 % Wireless Telecommunication Services 1,920 1,890 1,889 (5) Centerline Communications, LLC First Lien Revolver, LIBOR+5.50% cash due 8/10/2027 Wireless Telecommunication Services — (12) (12) (5) Total Centerline Communications, LLC 3,920 3,839 3,837 CITGO Petroleum Corp. First Lien Term Loan, LIBOR+6.25% cash due 3/28/2024 7.25 % Oil & Gas Refining & Marketing 7,111 7,040 7,134 (4) City Football Group Limited First Lien Term Loan, LIBOR+3.50% cash due 7/21/2028 4.00 % Movies & Entertainment 6,500 6,468 6,492 Connect U.S. Finco LLC First Lien Term Loan, LIBOR+3.50% cash due 12/11/2026 4.50 % Alternative Carriers 7,362 7,204 7,376 Convergeone Holdings, Inc. First Lien Term Loan, LIBOR+5.00% cash due 1/4/2026 5.08 % IT Consulting & Other Services 7,449 7,229 7,427 (4) Curium Bidco S.à.r.l. First Lien Term Loan, LIBOR+4.00% cash due 7/9/2026 4.13 % Biotechnology 5,880 5,836 5,884 Dcert Buyer, Inc. First Lien Term Loan, LIBOR+4.00% cash due 10/16/2026 4.08 % Internet Services & Infrastructure 5,885 5,870 5,893 DirecTV Financing, LLC First Lien Term Loan, LIBOR+5.00% cash due 8/2/2027 5.75 % Cable & Satellite 6,000 5,940 6,011 (4) Enviva Holdings, LP First Lien Term Loan, LIBOR+5.50% cash due 2/17/2026 6.50 % Forest Products 5,878 5,819 5,893 124 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes eResearch Technology, Inc. First Lien Term Loan, LIBOR+4.50% cash due 2/4/2027 5.50 % Application Software $ 7,406 $ 7,332 $ 7,451 GI Chill Acquisition LLC First Lien Term Loan, LIBOR+3.75% cash due 8/6/2025 3.90 % Managed Health Care 3,721 3,737 3,712 (4) GI Chill Acquisition LLC Second Lien Term Loan, LIBOR+7.50% cash due 8/6/2026 7.63 % Managed Health Care 3,750 3,674 3,731 (4) Total GI Chill Acquisition LLC 7,471 7,411 7,443 Gibson Brands, Inc. First Lien Term Loan, LIBOR+5.00% cash due 8/11/2028 5.75 % Leisure Products 7,500 7,425 7,463 Global Medical Response, Inc. First Lien Term Loan, LIBOR+4.75% cash due 10/2/2025 5.75 % Health Care Services 2,214 2,178 2,226 Global Medical Response, Inc. First Lien Term Loan, LIBOR+4.25% cash due 3/14/2025 5.25 % Health Care Services 1,995 1,995 2,004 (4) Total Global Medical Response, Inc. 4,209 4,173 4,230 Grab Holdings Inc. First Lien Term Loan, LIBOR+4.50% cash due 1/29/2026 5.50 % Interactive Media & Services 2,985 2,907 3,025 Indivior Finance S.À.R.L. First Lien Term Loan, LIBOR+5.25% cash due 6/30/2026 6.00 % Pharmaceuticals 7,481 7,336 7,456 Intelsat Jackson Holdings S.A. First Lien Term Loan, PRIME+4.75% cash due 11/27/2023 8.00 % Alternative Carriers 3,568 3,550 3,622 Intelsat Jackson Holdings S.A. First Lien Term Loan, LIBOR+4.75% cash due 7/13/2022 5.75 % Alternative Carriers 5,000 4,935 5,044 Intelsat Jackson Holdings S.A. First Lien Delayed Draw Term Loan, LIBOR+4.75% cash due 7/13/2022 Alternative Carriers — (13) 9 (5) Total Intelsat Jackson Holdings S.A. 8,568 8,472 8,675 INW Manufacturing, LLC First Lien Term Loan, LIBOR+5.75% cash due 5/7/2027 6.50 % Personal Products 9,875 9,597 9,678 (4) Lightbox Intermediate, L.P. First Lien Term Loan, LIBOR+5.00% cash due 5/9/2026 5.13 % Real Estate Services 7,443 7,377 7,405 (4) LogMeIn, Inc. First Lien Term Loan, LIBOR+4.75% cash due 8/31/2027 4.83 % Application Software 7,940 7,812 7,946 (4) LTI Holdings, Inc. First Lien Term Loan, LIBOR+3.50% cash due 9/6/2025 3.58 % Electronic Components 7,442 7,329 7,354 Maravai Intermediate Holdings, LLC First Lien Term Loan, LIBOR+3.75% cash due 10/19/2027 4.75 % Biotechnology 6,819 6,751 6,846 Mindbody, Inc. First Lien Term Loan, LIBOR+7.00% cash 1.50% PIK due 2/14/2025 8.00 % Internet Services & Infrastructure 4,616 4,565 4,528 (4) Mindbody, Inc. First Lien Revolver, LIBOR+8.00% cash due 2/14/2025 Internet Services & Infrastructure — (6) (9) (4)(5) Total Mindbody, Inc. 4,616 4,559 4,519 MRI Software LLC First Lien Term Loan, LIBOR+5.50% cash due 2/10/2026 6.50 % Application Software 3,877 3,843 3,875 (4) MRI Software LLC First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 2/10/2026 Application Software — (6) (1) (4)(5) MRI Software LLC First Lien Revolver, LIBOR+5.50% cash due 2/10/2026 Application Software — (3) — (4)(5) Total MRI Software LLC 3,877 3,834 3,874 Northern Star Industries Inc. First Lien Term Loan, LIBOR+4.50% cash due 3/31/2025 5.50 % Electrical Components & Equipment 6,755 6,738 6,738 OEConnection LLC First Lien Term Loan, LIBOR+4.00% cash due 9/25/2026 4.08 % Application Software 7,852 7,816 7,842 (4) Olaplex, Inc. First Lien Term Loan, LIBOR+6.25% cash due 1/8/2026 7.25 % Personal Products 6,273 6,189 6,226 (4) Olaplex, Inc. First Lien Revolver, LIBOR+6.25% cash due 1/8/2025 Personal Products — (7) (8) (4)(5) Total Olaplex, Inc. 6,273 6,182 6,218 Park Place Technologies, LLC First Lien Term Loan, LIBOR+5.00% cash due 11/10/2027 6.00 % Internet Services & Infrastructure 4,975 4,801 4,981 (4) Planview Parent, Inc. Second Lien Term Loan, LIBOR+7.25% cash due 12/18/2028 8.00 % Application Software 4,503 4,435 4,514 (4) 125 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes Pluralsight, LLC First Lien Term Loan, LIBOR+8.00% cash due 4/6/2027 9.00 % Application Software $ 6,796 $ 6,669 $ 6,667 (4) Pluralsight, LLC First Lien Revolver, LIBOR+8.00% cash due 4/6/2027 Application Software — (8) (8) (4)(5) Total Pluralsight, LLC 6,796 6,661 6,659 Sabert Corporation First Lien Term Loan, LIBOR+4.50% cash due 12/10/2026 5.50 % Metal & Glass Containers 2,728 2,700 2,738 (4) SHO Holding I Corporation First Lien Term Loan, LIBOR+5.25% cash due 4/27/2024 6.25 % Footwear 8,288 8,277 7,874 SHO Holding I Corporation First Lien Term Loan, LIBOR+5.23% cash due 4/27/2024 6.23 % Footwear 138 138 131 Total SHO Holding I Corporation 8,426 8,415 8,005 Sirva Worldwide, Inc. First Lien Term Loan, LIBOR+5.50% cash due 8/4/2025 5.58 % Diversified Support Services 1,087 1,071 1,027 (4) Sorenson Communications, LLC First Lien Term Loan, LIBOR+5.50% cash due 3/17/2026 6.25 % Communications Equipment 2,854 2,825 2,877 Star US Bidco LLC First Lien Term Loan, LIBOR+4.25% cash due 3/17/2027 5.25 % Industrial Machinery 8,255 8,075 8,289 (4) Supermoose Borrower, LLC First Lien Term Loan, LIBOR+3.75% cash due 8/29/2025 3.88 % Application Software 7,823 7,465 7,294 (4) Surgery Center Holdings, Inc. First Lien Term Loan, LIBOR+3.75% cash due 8/31/2026 4.50 % Health Care Facilities 4,911 4,895 4,925 Trench Plate Rental, Co. First Lien Term Loan, LIBOR+4.75% cash due 12/3/2026 5.75 % Construction Materials 3,942 3,882 3,881 Trench Plate Rental, Co. First Lien Delayed Draw Term Loan, LIBOR+4.75% cash due 12/3/2026 Construction Materials — (11) (12) (5) Trench Plate Rental, Co. First Lien Revolver, LIBOR+4.75% cash due 12/3/2026 5.75 % Construction Materials 24 15 15 (5) Total Trench Plate Rental, Co. 3,966 3,886 3,884 Veritas US Inc. First Lien Term Loan, LIBOR+5.00% cash due 9/1/2025 6.00 % Application Software 6,435 6,333 6,473 (4) Verscend Holding Corp. First Lien Term Loan, LIBOR+4.00% cash due 8/27/2025 4.08 % Health Care Technology 4,080 4,052 4,091 Waystar Technologies, Inc. First Lien Term Loan, LIBOR+4.00% cash due 10/22/2026 4.08 % Health Care Technology 5,910 5,880 5,921 Windstream Services II, LLC First Lien Term Loan, LIBOR+6.25% cash due 9/21/2027 7.25 % Integrated Telecommunication Services 7,899 7,629 7,948 (4) WP CPP Holdings, LLC Second Lien Term Loan, LIBOR+7.75% cash due 4/30/2026 8.75 % Aerospace & Defense 6,000 5,964 5,931 (4) Total Portfolio Investments $ 344,196 $ 346,052 $ 346,665 __________ (1) Represents the interest rate as of September 30, 2021. All interest rates are payable in cash, unless otherwise noted. (2) The interest rate on the principal balance outstanding for all floating rate loans is indexed to LIBOR and/or an alternate base rate (e.g., prime rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan. For each of these loans, the Company has provided the applicable margin over LIBOR or the alternate base rate based on each respective credit agreement and the cash interest rate as of period end. All the LIBOR shown above is in U.S. dollars. As of September 30, 2021, the reference rates for SLF JV I's variable rate loans were the 30-day LIBOR at 0.08%, the 60-day LIBOR at 0.11%, the 90-day LIBOR at 0.13%, the 180-day LIBOR at 0.16%, the 360-day LIBOR at 0.24% and the PRIME at 3.25%. Most loans include an interest floor, which generally ranges from 0% to 1%. (3) Represents the current determination of fair value as of September 30, 2021 utilizing a similar technique as the Company in accordance with ASC 820. However, the determination of such fair value is not included in the Company's Board of Directors' valuation process described elsewhere herein. (4) This investment was held by both the Company and SLF JV I as of September 30, 2021. (5) Investment had undrawn commitments. Unamortized fees are classified as unearned income which reduces cost basis, which may result in a negative cost basis. A negative fair value may result from the unfunded commitment being valued below par. 126 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) SLF JV I Portfolio as of September 30, 2020 Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes Access CIG, LLC First Lien Term Loan, LIBOR+3.75% cash due 2/27/2025 3.91 % Diversified Support Services $ 9,206 $ 9,170 $ 9,029 AdVenture Interactive, Corp. 927 shares of common stock Advertising 1,390 1,373 (4) AI Ladder (Luxembourg) Subco S.a.r.l. First Lien Term Loan, LIBOR+4.50% cash due 7/9/2025 4.65 % Electrical Components & Equipment 6,038 5,914 5,781 (4) Airbnb, Inc. First Lien Term Loan, LIBOR+7.50% cash due 4/17/2025 8.50 % Hotels, Resorts & Cruise Lines 3,051 2,981 3,311 (4) Altice France S.A. First Lien Term Loan, LIBOR+4.00% cash due 8/14/2026 4.15 % Integrated Telecommunication Services 4,643 4,450 4,527 Alvogen Pharma US, Inc. First Lien Term Loan, LIBOR+5.25% cash due 12/31/2023 6.25 % Pharmaceuticals 9,879 9,623 9,566 Amplify Finco Pty Ltd. First Lien Term Loan, LIBOR+4.00% cash due 11/26/2026 4.75 % Movies & Entertainment 7,960 7,880 6,846 (4) Anastasia Parent, LLC First Lien Term Loan, LIBOR+3.75% cash due 8/11/2025 Personal Products 2,828 2,282 1,248 (6) Apptio, Inc. First Lien Term Loan, LIBOR+7.25% cash due 1/10/2025 8.25 % Application Software 4,615 4,550 4,526 (4) Apptio, Inc. First Lien Revolver, LIBOR+7.25% cash due 1/10/2025 Application Software — (5) (8) (4)(5) Total Apptio, Inc. 4,615 4,545 4,518 Aurora Lux Finco S.À.R.L. First Lien Term Loan, LIBOR+6.00% cash due 12/24/2026 7.00 % Airport Services 6,468 6,324 6,015 (4) Blackhawk Network Holdings, Inc. First Lien Term Loan, LIBOR+3.00% cash due 6/15/2025 3.15 % Data Processing & Outsourced Services 9,775 9,758 9,251 Boxer Parent Company Inc. First Lien Term Loan, LIBOR+4.25% cash due 10/2/2025 4.40 % Systems Software 7,532 7,448 7,331 (4) Brazos Delaware II, LLC First Lien Term Loan, LIBOR+4.00% cash due 5/21/2025 4.16 % Oil & Gas Equipment & Services 7,331 7,306 5,600 C5 Technology Holdings, LLC 171 Common Units Data Processing & Outsourced Services — — (4) C5 Technology Holdings, LLC 7,193,539.63 Preferred Units Data Processing & Outsourced Services 7,194 5,683 (4) Total C5 Technology Holdings, LLC 7,194 5,683 Carrols Restaurant Group, Inc. First Lien Term Loan, LIBOR+6.25% cash due 4/30/2026 7.25 % Restaurants 3,990 3,792 3,960 CITGO Petroleum Corp. First Lien Term Loan, LIBOR+5.00% cash due 3/28/2024 6.00 % Oil & Gas Refining & Marketing 7,184 7,112 6,842 (4) Clear Channel Outdoor Holdings, Inc. First Lien Term Loan, LIBOR+3.50% cash due 8/21/2026 3.76 % Advertising 331 290 302 Connect U.S. Finco LLC First Lien Term Loan, LIBOR+4.50% cash due 12/11/2026 5.50 % Alternative Carriers 7,437 7,262 7,228 Curium Bidco S.à.r.l. First Lien Term Loan, LIBOR+3.75% cash due 7/9/2026 3.97 % Biotechnology 5,940 5,895 5,895 Dcert Buyer, Inc. First Lien Term Loan, LIBOR+4.00% cash due 10/16/2026 4.15 % Internet Services & Infrastructure 7,960 7,940 7,879 Dealer Tire, LLC First Lien Term Loan, LIBOR+4.25% cash due 12/12/2025 4.40 % Distributors 943 902 924 eResearch Technology, Inc. First Lien Term Loan, LIBOR+4.50% cash due 2/4/2027 5.50 % Application Software 7,481 7,406 7,461 Frontier Communications Corporation First Lien Term Loan, PRIME+2.75% cash due 6/15/2024 6.00 % Integrated Telecommunication Services 3,939 3,901 3,887 Gigamon, Inc. First Lien Term Loan, LIBOR+4.25% cash due 12/27/2024 5.25 % Systems Software 7,781 7,734 7,684 Global Medical Response, Inc. First Lien Term Loan, LIBOR+4.75% cash due 10/2/2025 5.75 % Health Care Services 2,231 2,187 2,185 Guidehouse LLP Second Lien Term Loan, LIBOR+8.00% cash due 5/1/2026 8.15 % Research & Consulting Services 6,000 5,979 5,790 (4) 127 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes Helios Software Holdings, Inc. First Lien Term Loan, LIBOR+4.25% cash due 10/24/2025 4.52 % Systems Software $ 3,970 $ 3,930 $ 3,923 Intelsat Jackson Holdings S.A. First Lien Term Loan, PRIME+4.75% cash due 11/27/2023 8.00 % Alternative Carriers 3,568 3,541 3,598 Intelsat Jackson Holdings S.A. First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 7/13/2022 6.50 % Alternative Carriers 971 801 1,011 (5) Total Intelsat Jackson Holdings S.A. 4,539 4,342 4,609 KIK Custom Products Inc. First Lien Term Loan, LIBOR+4.00% cash due 5/15/2023 5.00 % Household Products 5,322 5,308 5,302 LogMeIn, Inc. First Lien Term Loan, LIBOR+4.75% cash due 8/31/2027 4.91 % Application Software 5,000 4,876 4,842 Mindbody, Inc. First Lien Term Loan, LIBOR+7.00% cash 1.5% PIK due 2/14/2025 8.00 % Internet Services & Infrastructure 4,546 4,481 4,192 (4) Mindbody, Inc. First Lien Revolver, LIBOR+8.00% cash due 2/14/2025 Internet Services & Infrastructure — (7) (38) (4)(5) Total Mindbody, Inc. 4,546 4,474 4,154 MRI Software LLC First Lien Term Loan, LIBOR+5.50% cash due 2/10/2026 6.50 % Application Software 3,830 3,795 3,737 (4) MRI Software LLC First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 2/10/2026 Application Software — (1) (4) (4)(5) MRI Software LLC First Lien Revolver, LIBOR+5.50% cash due 2/10/2026 Application Software — (3) (8) (4)(5) Total MRI Software LLC 3,830 3,791 3,725 Navicure, Inc. First Lien Term Loan, LIBOR+4.00% cash due 10/22/2026 4.15 % Health Care Technology 5,970 5,940 5,849 New IPT, Inc. First Lien Term Loan, LIBOR+5.00% cash due 3/17/2021 6.00 % Oil & Gas Equipment & Services 1,006 1,006 786 (4) New IPT, Inc. 21.876 Class A Common Units in New IPT Holdings, LLC Oil & Gas Equipment & Services — — (4) Total New IPT, Inc. 1,006 1,006 786 Northern Star Industries Inc. First Lien Term Loan, LIBOR+4.75% cash due 3/31/2025 5.75 % Electrical Components & Equipment 6,825 6,803 6,518 Northwest Fiber, LLC First Lien Term Loan, LIBOR+5.50% cash due 4/30/2027 5.66 % Integrated Telecommunication Services 2,400 2,314 2,403 Novetta Solutions, LLC First Lien Term Loan, LIBOR+5.00% cash due 10/17/2022 6.00 % Application Software 5,931 5,909 5,827 OEConnection LLC First Lien Term Loan, LIBOR+4.00% cash due 9/25/2026 4.15 % Application Software 7,455 7,418 7,371 OEConnection LLC First Lien Delayed Draw Term Loan, LIBOR+4.00% cash due 9/25/2026 Application Software — (2) (5) (5) Total OEConnection LLC 7,455 7,416 7,366 Olaplex, Inc. First Lien Term Loan, LIBOR+6.50% cash due 1/8/2026 7.50 % Personal Products 4,938 4,851 4,938 (4) Olaplex, Inc. First Lien Revolver, LIBOR+6.50% cash due 1/8/2025 7.50 % Personal Products 270 261 270 (4)(5) Total Olaplex, Inc. 5,208 5,112 5,208 PetVet Care Centers, LLC First Lien Term Loan, LIBOR+4.25% cash due 2/14/2025 5.25 % Specialized Consumer Services 2,743 2,736 2,747 PG&E Corporation First Lien Term Loan, LIBOR+4.50% cash due 6/23/2025 5.50 % Electric Utilities 5,985 5,899 5,875 Recorded Books, Inc. First Lien Term Loan, LIBOR+4.25% cash due 8/31/2025 4.75 % Publishing 6,000 5,940 5,940 Sabert Corporation First Lien Term Loan, LIBOR+4.50% cash due 12/10/2026 5.50 % Metal & Glass Containers 2,828 2,800 2,791 Salient CRGT, Inc. First Lien Term Loan, LIBOR+6.50% cash due 2/28/2022 7.50 % Aerospace & Defense 2,111 2,099 1,963 (4) SHO Holding I Corporation First Lien Term Loan, LIBOR+3.00% cash PIK 2.25% due 4/27/2024 4.00 % Footwear 8,396 8,380 5,898 Signify Health, LLC First Lien Term Loan, LIBOR+4.50% cash due 12/23/2024 5.50 % Health Care Services 9,750 9,690 9,409 Sirva Worldwide, Inc. First Lien Term Loan, LIBOR+5.50% cash due 8/4/2025 5.65 % Diversified Support Services 4,781 4,709 3,992 128 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes Star US Bidco LLC First Lien Term Loan, LIBOR+4.25% cash due 3/17/2027 5.25 % Industrial Machinery $ 3,718 $ 3,532 $ 3,551 Sunshine Luxembourg VII SARL First Lien Term Loan, LIBOR+4.25% cash due 10/1/2026 5.25 % Personal Products 7,940 7,900 7,911 Supermoose Borrower, LLC First Lien Term Loan, LIBOR+3.75% cash due 8/29/2025 3.90 % Application Software 4,888 4,575 4,407 (4) Surgery Center Holdings, Inc. First Lien Term Loan, LIBOR+3.25% cash due 9/3/2024 4.25 % Health Care Facilities 4,962 4,943 4,691 (4) Uber Technologies, Inc. First Lien Term Loan, LIBOR+4.00% cash due 4/4/2025 5.00 % Application Software 2,997 2,959 2,980 UFC Holdings, LLC First Lien Term Loan, LIBOR+3.25% cash due 4/29/2026 4.25 % Movies & Entertainment 2,856 2,816 2,814 Veritas US Inc. First Lien Term Loan, LIBOR+5.50% cash due 9/1/2025 6.50 % Application Software 6,500 6,371 6,375 Verscend Holding Corp. First Lien Term Loan, LIBOR+4.50% cash due 8/27/2025 4.65 % Health Care Technology 4,112 4,080 4,084 (4) VM Consolidated, Inc. First Lien Term Loan, LIBOR+3.25% cash due 2/28/2025 3.40 % Data Processing & Outsourced Services 10,487 10,495 10,291 Windstream Services II, LLC First Lien Term Loan, LIBOR+6.25% cash due 9/21/2027 7.25 % Integrated Telecommunication Services 7,980 7,662 7,744 (4) WP CPP Holdings, LLC Second Lien Term Loan, LIBOR+7.75% cash due 4/30/2026 8.75 % Aerospace & Defense 6,000 5,956 4,680 (4) Total Portfolio Investments $ 307,579 $ 311,428 $ 298,771 __________ (1) Represents the interest rate as of September 30, 2020. All interest rates are payable in cash, unless otherwise noted. (2) The interest rate on the principal balance outstanding for all floating rate loans is indexed to LIBOR and/or an alternate base rate (e.g., prime rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan. For each of these loans, the Company has provided the applicable margin over LIBOR or the alternate base rate based on each respective credit agreement and the cash interest rate as of period end. All the LIBOR shown above is in U.S. dollars. As of September 30, 2020, the reference rates for SLF JV I's variable rate loans were the 30-day LIBOR at 0.15%, the 60-day LIBOR at 0.19%, the 90-day LIBOR at 0.22%, the 180-day LIBOR at 0.27% and the PRIME at 3.25%. Most loans include an interest floor, which generally ranges from 0% to 1%. (3) Represents the current determination of fair value as of September 30, 2020 utilizing a similar technique as the Company in accordance with ASC 820. However, the determination of such fair value is not included in the Company's Board of Directors' valuation process described elsewhere herein. (4) This investment was held by both the Company and SLF JV I as of September 30, 2020. (5) Investment had undrawn commitments. Unamortized fees are classified as unearned income which reduces cost basis, which may result in a negative cost basis. A negative fair value may result from the unfunded commitment being valued below par. (6) This investment was on cash non-accrual status as of September 30, 2020. Cash non-accrual status is inclusive of PIK and other non-cash income, where applicable. Both the cost and fair value of the Company's SLF JV I Notes were $96.3 million as of each of September 30, 2021 and September 30, 2020. The Company earned interest income of $7.4 million, $8.1 million and $9.8 million on the SLF JV I Notes for the years ended September 30, 2021, 2020 and 2019, respectively. As of September 30, 2021, the SLF JV I Notes bore interest at a rate of one-month LIBOR plus 7.00% per annum with a LIBOR floor of 1.00% and will mature on December 29, 2028. The cost and fair value of the LLC equity interests in SLF JV I held by the Company were $49.3 million and $37.7 million, respectively, as of September 30, 2021, and $49.3 million and $21.2 million, respectively, as of September 30, 2020. The Company earned $0.9 million in dividend income for the year ended September 30, 2021 with respect to its investment in the LLC equity interests of SLF JV I. The Company did not earn dividend income for the years ended September 30, 2020 and 2019 with respect to its investment in the LLC equity interests of SLF JV I. The LLC equity interests of SLF JV I are generally dividend producing to the extent SLF JV I has residual cash to be distributed on a quarterly basis. 129 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Below is certain summarized financial information for SLF JV I as of September 30, 2021 and September 30, 2020 and for the years ended September 30, 2021, 2020 and 2019: September 30, 2021 September 30, 2020 Selected Balance Sheet Information: Investments at fair value (cost September 30, 2021: $346,052; cost September 30, 2020: $311,428) $ 346,665 $ 298,771 Cash and cash equivalents 23,446 5,389 Restricted cash 4,517 4,211 Other assets 4,529 5,093 Total assets $ 379,157 $ 313,464 Senior credit facility payable $ 215,620 $ 167,910 SLF JV I Notes payable at fair value (proceeds September 30, 2021: $110,000; proceeds September 30, 2020: $110,000) 110,000 110,000 Other liabilities 10,507 11,336 Total liabilities $ 336,127 $ 289,246 Members' equity 43,030 24,218 Total liabilities and members' equity $ 379,157 $ 313,464 Year ended September 30, 2021 Year ended September 30, 2020 Year ended September 30, 2019 Selected Statements of Operations Information: Interest income $ 20,018 $ 19,808 $ 22,727 Other income 565 338 153 Total investment income 20,583 20,146 22,880 Senior credit facility interest expense 5,706 7,432 8,705 SLF JV I Notes interest expense 8,444 9,205 11,153 Other expenses 260 244 358 Total expenses (1) 14,410 16,881 20,216 Net unrealized appreciation (depreciation) 13,270 (9,704) 2,257 Net realized gains (losses) 399 (3,691) (8,507) Net income (loss) $ 19,842 $ (10,130) $ (3,586) __________ (1) There are no management fees or incentive fees charged at SLF JV I. SLF JV I has elected to fair value the SLF JV I Notes issued to the Company and Kemper under FASB ASC Topic 825, Financial Instruments - Fair Value Option . The SLF JV I Notes are valued based on the total assets less the total liabilities senior to the SLF JV I Notes in an amount not exceeding par under the EV technique. During the year ended September 30, 2021, the Company sold $48.0 million of senior secured debt investments to SLF JV I for $47.2 million cash consideration, which represented the fair value at the time of sale. A gain of $2.5 million was recognized by the Company on these transactions. During the year ended September 30, 2020, the Company did not sell any debt investments to SLF JV I. During the year ended September 30, 2019, the Company sold $8.4 million of senior secured debt investments to SLF JV I at fair value in exchange for $8.3 million cash consideration. A loss of $0.1 million was recognized by the Company on these transactions. 130 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) OCSI Glick JV LLC On March 19, 2021, as a result of the consummation of the Mergers, the Company became party to the LLC agreement of Glick JV. The Glick JV invests primarily in senior secured loans of middle-market companies. The Company co-invests in these securities with GF Equity Funding through the Glick JV. The Glick JV is managed by a four person Board of Directors, two of whom are selected by the Company and two of whom are selected by GF Equity Funding. The Glick JV is capitalized as transactions are completed, and portfolio decisions and investment decisions in respect of the Glick JV must be approved by the Glick JV investment committee, which consists of one representative selected by the Company and one representative selected by GF Equity Funding (with approval from a representative of each required). Since the Company does not have a controlling financial interest in the Glick JV, the Company does not consolidate the Glick JV. The members provide capital to the Glick JV in exchange for LLC equity interests, and the Company and GF Debt Funding 2014 LLC ("GF Debt Funding"), an entity advised by affiliates of GF Equity Funding, provide capital to the Glick JV in exchange for subordinated notes issued by the Glick JV (the "Glick JV Notes"). As of September 30, 2021, the Company and GF Equity Funding owned 87.5% and 12.5%, respectively, of the outstanding LLC equity interests, and the Company and GF Debt Funding owned 87.5% and 12.5%, respectively, of the Glick JV Notes. The Glick JV is not an "eligible portfolio company" as defined in section 2(a)(46) of the Investment Company Act. The Glick JV has a senior revolving credit facility with Deutsche Bank AG, New York Branch (the "Glick JV Deutsche Bank Facility"), which, as of September 30, 2021, had a reinvestment period end date and maturity date of May 3, 2023 and May 3, 2028, respectively, and permitted borrowings of up to $90.0 million (subject to borrowing base and other limitations). Borrowings under the Glick JV Deutsche Bank Facility are secured by all of the assets of the Glick JV and all of the equity interests in the Glick JV and, as of September 30, 2021, bore interest at a rate equal to 3-month LIBOR plus 2.25% per annum during the reinvestment period, 3-month LIBOR plus 2.40% for the first year after the end of the reinvestment period, 3-month LIBOR plus 2.50% for the following year and 2.75% thereafter, in each case with a 0.125% LIBOR floor. Under the Glick JV Deutsche Bank Facility, $71.9 million of borrowings were outstanding as of September 30, 2021. As of September 30, 2021, the Glick JV had total assets of $141.0 million. The Glick JV's portfolio consisted of middle-market and other corporate debt securities of 37 portfolio companies as of September 30, 2021. The portfolio companies in the Glick JV are in industries similar to those in which the Company may invest directly. The Company's investment in the Glick JV consisted of LLC equity interests and Glick JV Notes of $55.6 million in the aggregate at fair value as of September 30, 2021. The Glick JV Notes are junior in right of payment to the repayment of temporary contributions made by the Company to fund investments of the Glick JV that are repaid when GF Equity Funding and GF Debt Funding make their capital contributions and fund their Glick JV Notes, respectively. As of September 30, 2021, the Glick JV had total capital commitments of $100.0 million, $87.5 million of which was from the Company and the remaining $12.5 million of which was from GF Equity Funding and GF Debt Funding. Approximately $84.0 million in aggregate commitments were funded as of September 30, 2021, of which $73.5 million was from the Company. As of September 30, 2021, the Company had commitments to fund Glick JV Notes of $78.8 million, of which $12.4 million were unfunded as of such date. As of September 30, 2021, the Company had commitments to fund LLC equity interests in the Glick JV of $8.7 million, of which $1.6 million were unfunded. 131 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Below is a summary of the Glick JV's portfolio, followed by a listing of the individual loans in the Glick JV's portfolio as of September 30, 2021: September 30, 2021 Senior secured loans (1) $126,512 Weighted average current interest rate on senior secured loans (2) 5.86% Number of borrowers in the Glick JV 37 Largest loan exposure to a single borrower (1) $6,907 Total of five largest loan exposures to borrowers (1) $28,324 __________ (1) At principal amount. (2) Computed using the weighted average annual interest rate on accruing senior secured loans at fair value. Glick JV Portfolio as of September 30, 2021 Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes ADB Companies, LLC First Lien Term Loan, LIBOR+6.25% cash due 12/18/2025 7.25% Construction & Engineering $ 3,866 $ 3,783 $ 3,822 (4) Alvogen Pharma US, Inc. First Lien Term Loan, LIBOR+5.25% cash due 12/31/2023 6.25% Pharmaceuticals 6,907 6,780 6,687 (4) Amplify Finco Pty Ltd. First Lien Term Loan, LIBOR+4.25% cash due 11/26/2026 5.00% Movies & Entertainment 2,955 2,925 2,880 (4) Anastasia Parent, LLC First Lien Term Loan, LIBOR+3.75% cash due 8/11/2025 3.88% Personal Products 1,667 1,310 1,416 Asurion, LLC Second Lien Term Loan, LIBOR+5.25% cash due 1/20/2029 5.33% Property & Casualty Insurance 3,000 2,970 2,990 Aurora Lux Finco S.À.R.L. First Lien Term Loan, LIBOR+6.00% cash due 12/24/2026 7.00% Airport Services 3,694 3,625 3,476 (4) BAART Programs, Inc. First Lien Term Loan, LIBOR+5.00% cash due 6/11/2027 6.00% Health Care Services 3,192 3,160 3,184 BAART Programs, Inc. First Lien Delayed Draw Term Loan, LIBOR+5.00% cash due 6/11/2027 6.00% Health Care Services 240 232 238 (5) Total BAART Programs, Inc. 3,432 3,392 3,422 Brazos Delaware II, LLC First Lien Term Loan, LIBOR+4.00% cash due 5/21/2025 4.08% Oil & Gas Equipment & Services 4,835 4,823 4,772 CITGO Petroleum Corp. First Lien Term Loan, LIBOR+6.25% cash due 3/28/2024 7.25% Oil & Gas Refining & Marketing 3,555 3,520 3,567 (4) City Football Group Limited First Lien Term Loan, LIBOR+3.50% cash due 7/21/2028 4.00% Movies & Entertainment 2,500 2,488 2,497 Curium Bidco S.à.r.l. First Lien Term Loan, LIBOR+4.00% cash due 7/9/2026 4.13% Biotechnology 4,900 4,863 4,903 DirecTV Financing, LLC First Lien Term Loan, LIBOR+5.00% cash due 8/2/2027 5.75% Cable & Satellite 3,000 2,970 3,005 (4) Enviva Holdings, LP First Lien Term Loan, LIBOR+5.50% cash due 2/17/2026 6.50% Forest Products 3,919 3,879 3,928 eResearch Technology, Inc. First Lien Term Loan, LIBOR+4.50% cash due 2/4/2027 5.50% Application Software 2,469 2,444 2,484 Gibson Brands, Inc. First Lien Term Loan, LIBOR+5.00% cash due 8/11/2028 5.75% Leisure Products 4,000 3,960 3,981 Houghton Mifflin Harcourt Publishers Inc. First Lien Term Loan, LIBOR+6.25% cash due 11/22/2024 7.25% Education Services 431 420 433 (4) Indivior Finance S.À.R.L. First Lien Term Loan, LIBOR+5.25% cash due 6/30/2026 6.00% Pharmaceuticals 3,990 3,913 3,977 Integro Parent, Inc. First Lien Term Loan, LIBOR+5.75% cash due 10/31/2022 6.75% Insurance Brokers 3,229 3,221 3,173 Intelsat Jackson Holdings S.A. First Lien Term Loan, LIBOR+4.75% cash due 7/13/2022 5.75% Alternative Carriers 4,167 4,112 4,203 Intelsat Jackson Holdings S.A. First Lien Delayed Draw Term Loan, LIBOR+4.75% cash due 7/13/2022 Alternative Carriers — (11) 7 (5) Total Intelsat Jackson Holdings S.A. 4,167 4,101 4,210 INW Manufacturing, LLC First Lien Term Loan, LIBOR+5.75% cash due 5/7/2027 6.50% Personal Products 2,469 2,399 2,419 (4) 132 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Portfolio Company Investment Type Cash Interest Rate (1)(2) Industry Principal Cost Fair Value (3) Notes Lightstone Holdco LLC First Lien Term Loan, LIBOR+3.75% cash due 1/30/2024 4.75% Electric Utilities $ 3,439 $ 3,115 $ 2,855 LTI Holdings, Inc. First Lien Term Loan, LIBOR+3.50% cash due 9/6/2025 3.58% Electronic Components 1,372 1,147 1,356 MRI Software LLC First Lien Term Loan, LIBOR+5.50% cash due 2/10/2026 6.50% Application Software 1,635 1,621 1,634 (4) MRI Software LLC First Lien Delayed Draw Term Loan, LIBOR+5.50% cash due 2/10/2026 Application Software — (1) — (4)(5) MRI Software LLC First Lien Revolver, LIBOR+5.50% cash due 2/10/2026 Application Software — (1) — (4)(5) Total MRI Software LLC 1,635 1,619 1,634 Northern Star Industries Inc. First Lien Term Loan, LIBOR+4.50% cash due 3/31/2025 5.50% Electrical Components & Equipment 5,308 5,294 5,294 OEConnection LLC First Lien Term Loan, LIBOR+4.00% cash due 9/25/2026 4.08% Application Software 3,926 3,908 3,921 (4) Olaplex, Inc. First Lien Term Loan, LIBOR+6.25% cash due 1/8/2026 7.25% Personal Products 3,502 3,454 3,475 (4) Olaplex, Inc. First Lien Revolver, LIBOR+6.25% cash due 1/8/2025 Personal Products — (4) (5) (4)(5) Total Olaplex, Inc. 3,502 3,450 3,470 Planview Parent, Inc. Second Lien Term Loan, LIBOR+7.25% cash due 12/18/2028 8.00% Application Software 2,842 2,799 2,849 (4) Pluralsight, LLC First Lien Term Loan, LIBOR+8.00% cash due 4/6/2027 9.00% Application Software 4,465 4,383 4,380 (4) Pluralsight, LLC First Lien Revolver, LIBOR+8.00% cash due 4/6/2027 Application Software — (6) (6) (4)(5) Total Pluralsight, LLC 4,465 4,377 4,374 Sabert Corporation First Lien Term Loan, LIBOR+4.50% cash due 12/10/2026 5.50% Metal & Glass Containers 1,819 1,800 1,825 (4) SHO Holding I Corporation First Lien Term Loan, LIBOR+5.25% cash due 4/27/2024 6.25% Footwear 6,159 6,140 5,851 SHO Holding I Corporation First Lien Term Loan, LIBOR+5.23% cash due 4/27/2024 6.23% Footwear 102 102 97 Total SHO Holding I Corporation 6,261 6,242 5,948 Supermoose Borrower, LLC First Lien Term Loan, LIBOR+3.75% cash due 8/29/2025 3.88% Application Software 2,850 2,703 2,657 (4) Surgery Center Holdings, Inc. First Lien Term Loan, LIBOR+3.75% cash due 8/31/2026 4.50% Health Care Facilities 4,911 4,895 4,925 Tribe Buyer LLC First Lien Term Loan, LIBOR+4.50% cash due 2/16/2024 5.50% Human Resource & Employment Services 1,599 1,598 1,354 Verscend Holding Corp. First Lien Term Loan, LIBOR+4.00% cash due 8/27/2025 4.08% Health Care Technology 1,721 1,709 1,725 Waystar Technologies, Inc. First Lien Term Loan, LIBOR+4.00% cash due 10/22/2026 4.08% Health Care Technology 3,940 3,920 3,947 Windstream Services II, LLC First Lien Term Loan, LIBOR+6.25% cash due 9/21/2027 7.25% Integrated Telecommunication Services 4,937 4,768 4,967 (4) WP CPP Holdings, LLC Second Lien Term Loan, LIBOR+7.75% cash due 4/30/2026 8.75% Aerospace & Defense 3,000 2,982 2,965 (4) Total Portfolio Investments $ 126,512 $ 124,112 $ 124,108 __________ (1) Represents the interest rate as of September 30, 2021. All interest rates are payable in cash, unless otherwise noted. (2) The interest rate on the principal balance outstanding for all floating rate loans is indexed to LIBOR and/or an alternate base rate (e.g., prime rate), which typically resets semi-annually, quarterly, or monthly at the borrower's option. The borrower may also elect to have multiple interest reset periods for each loan. For each of these loans, the Company has provided the applicable margin over LIBOR or the alternate base rate based on each respective credit agreement and the cash interest rate as of period end. All LIBOR shown above is in U.S. dollars. As of September 30, 2021, the reference rates for the Glick JV's variable rate loans were the 30-day LIBOR at 0.08%, the 60-day LIBOR at 0.11%, the 90-day LIBOR at 0.13%, the 180-day LIBOR at 0.16% and the 360-day LIBOR at 0.24%. Most loans include an interest floor, which generally ranges from 0% to 1%. (3) Represents the current determination of fair value as of September 30, 2021 utilizing a similar technique as the Company in accordance with ASC 820. However, the determination of such fair value is not included in the Company's Board of Directors' valuation process described elsewhere herein. (4) This investment was held by both the Company and the Glick JV as of September 30, 2021. 133 (5) Investment had undrawn commitments. Unamortized fees are classified as unearned income which reduces cost basis, which may result in a negative cost basis. A negative fair value may result from the unfunded commitment being valued below par. The cost and fair value of the Company's aggregate investment in the Glick JV was $50.7 million and $55.6 million, respectively, as of September 30, 2021. For the period from March 19, 2021 to September 30, 2021, the Company's investment in the Glick JV Notes earned interest income of $2.4 million. The Company did not earn any dividend income for the period from March 19, 2021 to September 30, 2021 with respect to its investment in the LLC equity interests of the Glick JV. The LLC equity interests of the Glick JV are income producing to the extent there is residual cash to be distributed on a quarterly basis. As of September 30, 2021, the Glick JV Notes bore interest at a rate of one-month LIBOR plus 4.50% per annum and will mature on October 20, 2028. Below is certain summarized financial information for the Glick JV as of September 30, 2021 and for the period from March 19, 2021 to September 30, 2021: September 30, 2021 Selected Balance Sheet Information: Investments at fair value (cost September 30, 2021: $124,112) $ 124,108 Cash and cash equivalents 14,087 Restricted cash 1,055 Other assets 1,750 Total assets $ 141,000 Senior credit facility payable $ 71,882 Glick JV Notes payable at fair value (proceeds September 30, 2021: $70,525) 63,522 Other liabilities 5,596 Total liabilities $ 141,000 Members' equity — Total liabilities and members' equity $ 141,000 For the period from March 19, 2021 to September 30, 2021 Selected Statements of Operations Information: Interest income $ 4,643 Fee income 67 Total investment income 4,710 Senior credit facility interest expense 1,157 Glick JV Notes interest expense 1,780 Other expenses 95 Total expenses (1) 3,032 Net unrealized appreciation (depreciation) (1,710) Realized gain (loss) 32 Net income (loss) $ — __________ (1) There are no management fees or incentive fees charged at the Glick JV. The Glick JV has elected to fair value the Glick JV Notes issued to the Company and GF Debt Funding under FASB ASC Topic 825, Financial Instruments - Fair Value Option . The Glick JV Notes are valued based on the total assets less the liabilities senior to the Glick JV Notes in an amount not exceeding par under the EV technique. During the period from March 19, 2021 to September 30, 2021, the Company did not sell any debt investments to the Glick JV. Note 4. Fee Income For the years ended September 30, 2021, 2020 and 2019, the Company recorded total fee income of $14.1 million, $8.5 million and $6.7 million, respectively, of which $0.6 million, $0.7 million and $0.6 million, respectively, was recurring in nature. Recurring fee income primarily consisted of servicing fees and exit fees. 134 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Note 5. Share Data and Net Assets Earnings per Share The following table sets forth the computation of basic and diluted earnings per share, pursuant to ASC Topic 260-10, Earnings per Share , for the years ended September 30, 2021, 2020 and 2019: (Share amounts in thousands) Year ended September 30, 2021 Year ended September 30, 2020 Year ended September 30, 2019 Earnings (loss) per common share — basic and diluted: Net increase (decrease) in net assets resulting from operations $ 237,260 $ 39,224 $ 126,160 Weighted average common shares outstanding — basic and diluted 162,118 140,961 140,961 Earnings (loss) per common share — basic and diluted $ 1.46 $ 0.28 $ 0.89 Changes in Net Assets The following table presents the changes in net assets for the years ended September 30, 2021, 2020 and 2019: Common Stock Shares Par Value Additional paid-in-capital Accumulated Overdistributed Earnings Total Net Assets Balance at September 30, 2018 140,961 $ 1,409 $ 1,492,739 $ (636,113) $ 858,035 Net investment income — — — 67,909 67,909 Net unrealized appreciation (depreciation) — — — 38,457 38,457 Net realized gains (losses) — — — 20,805 20,805 (Provision) benefit for taxes on realized and unrealized gains (losses) — — — (1,011) (1,011) Distributions to stockholders — — — (53,565) (53,565) Reclassification of additional paid-in capital — — (4,965) 4,965 — Issuance of common stock under dividend reinvestment plan 269 3 1,341 — 1,344 Repurchases of common stock under dividend reinvestment plan (269) (3) (1,341) — (1,344) Balance at September 30, 2019 140,961 $ 1,409 $ 1,487,774 $ (558,553) $ 930,630 Net investment income — — — 71,992 71,992 Net unrealized appreciation (depreciation) — — — (20,614) (20,614) Net realized gains (losses) — — — (13,924) (13,924) (Provision) benefit for taxes on realized and unrealized gains (losses) — — — 1,770 1,770 Distributions to stockholders — — — (54,975) (54,975) Issuance of common stock under dividend reinvestment plan 435 4 1,874 — 1,878 Repurchases of common stock under dividend reinvestment plan (435) (4) (1,874) — (1,878) Balance at September 30, 2020 140,961 $ 1,409 $ 1,487,774 $ (574,304) $ 914,879 Net investment income — — — 97,106 97,106 Net unrealized appreciation (depreciation) — — — 114,519 114,519 Net realized gains (losses) — — — 26,420 26,420 (Provision) benefit for taxes on realized and unrealized gains (losses) — — — (785) (785) Distributions to stockholders — — — (82,020) (82,020) Reclassification of additional paid-in capital — — 74,271 (74,271) — Issuance of common stock in connection with the Mergers 39,400 395 242,309 — 242,704 Issuance of common stock under dividend reinvestment plan 338 3 2,167 — 2,170 Repurchases of common stock under dividend reinvestment plan (338) (3) (2,167) — (2,170) Balance at September 30, 2021 180,361 $ 1,804 $ 1,804,354 $ (493,335) $ 1,312,823 Distributions Distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid out as a dividend is determined by the Board of Directors and is based on management’s estimate of the Company’s annual taxable income. Net realized capital gains, if any, may be distributed to stockholders or retained for reinvestment. 135 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) The Company has adopted a dividend reinvestment plan (“DRIP”) that provides for reinvestment of any distributions the Company declares in cash on behalf of its stockholders, unless a stockholder elects to receive cash. As a result, if the Company’s Board of Directors declares a cash distribution, then the Company’s stockholders who have not “opted out” of the Company’s DRIP will have their cash distribution automatically reinvested in additional shares of the Company’s common stock, rather than receiving the cash distribution. If the Company’s shares are trading at a premium to net asset value, the Company typically issues new shares to implement the DRIP with such shares issued at the greater of the most recently computed net asset value per share of common stock or 95% of the current market price per share of common stock on the payment date for such distribution. If the Company’s shares are trading at a discount to net asset value, the Company typically purchases shares in the open market in connection with the Company’s obligations under the DRIP. For U.S. federal income tax purposes, the Company estimates its distributions for the 2021 calendar year will be composed primarily of ordinary income. The character of such distributions will be appropriately reported to the Internal Revenue Service and stockholders for the 2020 calendar year. To the extent the Company’s taxable earnings for a fiscal and taxable year fall below the amount of distributions paid for the fiscal and taxable year, a portion of the total amount of the Company’s distributions for the fiscal and taxable year is deemed a return of capital for U.S. federal income tax purposes to the Company’s stockholders. For the year ended September 30, 2021, no portion of the distributions was deemed a return of capital for tax purposes. The following table reflects the distributions per share that the Company has paid, including shares issued under the DRIP, on its common stock during the years ended September 30, 2021, 2020 and 2019: Date Declared Record Date Payment Date Amount per Share Cash Distribution DRIP Shares Issued (1) DRIP Shares Value (2) November 13, 2020 December 15, 2020 December 31, 2020 $ 0.11 $ 15.0 million 93,964 $ 0.5 million January 29, 2021 March 15, 2021 March 31, 2021 0.12 16.4 million 81,702 0.5 million April 30, 2021 June 15, 2021 June 30, 2021 0.13 22.9 million 76,979 0.5 million July 30, 2021 September 15, 2021 September 30, 2021 0.145 25.5 million 85,075 0.6 million Total for the year ended September 30, 2021 $ 0.505 $ 79.8 million 337,720 $ 2.2 million Date Declared Record Date Payment Date Amount per Share Cash Distribution DRIP Shares Issued (1) DRIP Shares Value November 12, 2019 December 13, 2019 December 31, 2019 $ 0.095 $ 12.9 million 87,747 $ 0.5 million January 31, 2020 March 13, 2020 March 31, 2020 0.095 12.9 million 157,523 0.5 million April 30, 2020 June 15, 2020 June 30, 2020 0.095 13.0 million 87,351 0.4 million July 31, 2020 September 15, 2020 September 30, 2020 0.105 14.3 million 102,404 0.5 million Total for the year ended September 30, 2020 $ 0.390 $ 53.1 million 435,025 $ 1.9 million Date Declared Record Date Payment Date Amount per Share Cash Distribution DRIP Shares Issued (1) DRIP Shares Value November 19, 2018 December 17, 2018 December 28, 2018 $ 0.095 $ 13.0 million 87,429 $ 0.4 million February 1, 2019 March 15, 2019 March 29, 2019 0.095 13.1 million 59,603 0.3 million May 3, 2019 June 14, 2019 June 28, 2019 0.095 13.1 million 61,093 0.3 million August 2, 2019 September 13, 2019 September 30, 2019 0.095 13.1 million 61,205 0.3 million Total for the year ended September 30, 2019 $ 0.380 $ 52.3 million 269,330 $ 1.3 million __________ (1) Shares were purchased on the open market and distributed. (2) Rounded balance may not sum to the total. Common Stock Issuances On March 19, 2021, in connection with the Mergers, the Company issued an aggregate of 39,400,011 shares of common stock to former OCSI stockholders. There were no other common stock issuances during the years ended September 30, 2021, 2020 and 2019. Note 6. Borrowings Syndicated Facility On November 30, 2017, the Company entered into a senior secured revolving credit facility (as amended and restated, the “Syndicated Facility”) pursuant to a Senior Secured Revolving Credit Agreement with the lenders party thereto, ING Capital 136 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) LLC, as administrative agent, ING Capital LLC, JPMorgan Chase Bank, N.A., BofA Securities, Inc. and MUFG Union Bank, N.A. as joint lead arrangers and joint bookrunners, and JPMorgan Chase Bank, N.A. and Bank of America, N.A., as syndication agents. The Syndicated Facility provides that the Company may use the proceeds of the loans and issuances of letters of credit under the Syndicated Facility for general corporate purposes, including acquiring and funding leveraged loans, mezzanine loans, high-yield securities, convertible securities, preferred stock, common stock and other investments. The Syndicated Facility further allows the Company to request letters of credit from ING Capital LLC, as the issuing bank. On October 28, 2020, the Company entered into an incremental commitment and assumption agreement in connection with the Company’s exercise of $75 million of the accordion feature under the Syndicated Facility. On December 28, 2020, the Company entered into an incremental commitment agreement pursuant to which a lender under the Syndicated Facility increased its commitment amount under the Syndicated Facility by $25 million. On May 4, 2021, the Company amended the Syndicated Credit Facility to, among other things, increase the size of the facility by $150 million (and increase the “accordion” feature to permit the Company, under certain circumstances, to increase the size of the facility to up to the greater of $1.25 billion and the Company’s net worth, as defined in the facility). As a result of such agreements, as of September 30, 2021, the size of the Syndicated Facility was $950 million. As of September 30, 2021, (i) the period during which the Company may make drawings will expire on May 4, 2025 and the maturity date is May 4, 2026 and (ii) the interest rate margin for (a) LIBOR loans (which may be 1-, 2-, 3- or 6-month, at the Company’s option) was 2.00% and (b) alternate base rate loans was 1.00%. The Syndicated Facility is secured by substantially all of the Company’s assets (excluding, among other things, investments held in and by certain subsidiaries of the Company (including OCSL Senior Funding II LLC) or investments in certain portfolio companies of the Company) and guaranteed by certain subsidiaries of the Company. As of September 30, 2021, except for assets that were held by OCSL Senior Funding II LLC and certain immaterial subsidiaries, substantially all of the Company's assets are pledged as collateral under the Syndicated Facility. The Syndicated Facility requires the Company to, among other things, (i) make representations and warranties regarding the collateral as well as each of the Company’s portfolio companies’ businesses, (ii) agree to certain indemnification obligations, and (iii) comply with various affirmative and negative covenants, reporting requirements and other customary requirements for similar revolving credit facilities, including covenants related to: (A) limitations on the incurrence of additional indebtedness and liens, (B) limitations on certain investments, (C) limitations on certain asset transfers and restricted payments, (D) maintaining a certain minimum stockholders’ equity, (E) maintaining a ratio of total assets (less total liabilities) to total indebtedness, of the Company and its subsidiaries (subject to certain exceptions), of not less than 1.50 to 1.00, (F) maintaining a ratio of consolidated EBITDA to consolidated interest expense, of the Company and its subsidiaries (subject to certain exceptions), of not less than 2.25 to 1.00, (G) maintaining a minimum liquidity and net worth, and (H) limitations on the creation or existence of agreements that prohibit liens on certain properties of the Company and certain of its subsidiaries. The Syndicated Facility also includes usual and customary default provisions such as the failure to make timely payments under the facility, the occurrence of a change in control, and the failure by the Company to materially perform under the agreements governing the facility, which, if not complied with, could accelerate repayment under the facility. As of September 30, 2021, the Company was in compliance with all financial covenants under the Syndicated Facility. In addition to the asset coverage ratio described above, borrowings under the Syndicated Facility (and the incurrence of certain other permitted debt) are subject to compliance with a borrowing base that will apply different advance rates to different types of assets in the Company’s portfolio. Each loan or letter of credit originated or assumed under the Syndicated Facility is subject to the satisfaction of certain conditions. As of September 30, 2021 and September 30, 2020, the Company had $495.0 million and $414.8 million of borrowings outstanding under the Syndicated Facility, respectively, which had a fair value of $495.0 million and $414.8 million, respectively. The Company's borrowings under the Syndicated Facility bore interest at a weighted average interest rate of 2.197%, 3.028% and 4.550% for the years ended September 30, 2021, 2020 and 2019, respectively. For the years ended September 30, 2021, 2020 and 2019, the Company recorded interest expense (inclusive of fees) of $13.8 million, $14.9 million and $17.1 million, respectively, related to the Syndicated Facility. Citibank Facility On March 19, 2021, as a result of the consummation of the Mergers, the Company became party to a revolving credit facility (as amended and/or restated from time to time, the “Citibank Facility”) with OCSL Senior Funding II LLC (formerly OCSI Senior Funding II LLC), the Company’s wholly-owned, special purpose financing subsidiary, as the borrower, the Company, as collateral manager and seller, each of the lenders from time to time party thereto, Citibank, N.A., as administrative agent, and Wells Fargo Bank, National Association, as collateral agent and custodian. 137 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) As of September 30, 2021, the Company was able to borrow up to $150 million under the Citibank Facility (subject to borrowing base and other limitations). As of September 30, 2021, the reinvestment period under the Citibank Facility was scheduled to expire on July 18, 2023 and the maturity date for the Citibank Facility was July 18, 2024. As of September 30, 2021, borrowings under the Citibank Facility are subject to certain customary advance rates and accrue interest at a rate equal to LIBOR plus between 1.25% and 2.20% per annum on broadly syndicated loans, subject to observable market depth and pricing, and LIBOR plus 2.25% per annum on all other eligible loans during the reinvestment period. In addition, as of September 30, 2021, for the duration of the reinvestment period there is a non-usage fee payable of 0.50% per annum on the undrawn amount under the Citibank Facility. The minimum asset coverage ratio applicable to the Company under the Citibank Facility is 150% as determined in accordance with the requirements of the Investment Company Act. Borrowings under the Citibank Facility are secured by all of the assets of OCSL Senior Funding II LLC and all of the Company’s equity interests in OCSL Senior Funding II LLC. The Company may use the Citibank Facility to fund a portion of its loan origination activities and for general corporate purposes. Each loan origination under the Citibank Facility is subject to the satisfaction of certain conditions. As of September 30, 2021, the Company had $135.0 million outstanding under the Citibank Facility, which had a fair value of $135.0 million. The Company's borrowings under the Citibank Facility bore interest at a weighted average interest rate of 2.086% for the period from March 19, 2021 to September 30, 2021. For the period from March 19, 2021 to September 30, 2021, the Company recorded interest expense (inclusive of fees) of $1.9 million related to the Citibank Facility. Deutsche Bank Facility On March 19, 2021, as a result of the consummation of the Mergers, the Company became party to a loan financing and servicing agreement (as amended, the “Deutsche Bank Facility”) with OCSI Senior Funding Ltd., the Company’s wholly-owned, special purpose financing subsidiary, as borrower, the Company, as equityholder and as servicer, the lenders from time to time party thereto, Deutsche Bank AG, New York Branch, as facility agent, and Wells Fargo Bank, National Association, as collateral agent and as collateral custodian. On May 4, 2021, the Company repaid all outstanding borrowings under the Deutsche Bank Facility using borrowings under the Syndicated Credit Facility, following which the Deutsche Bank Facility was terminated. For the period from March 19, 2021 to May 4, 2021, the Company’s borrowings under the Deutsche Bank Facility bore interest at a weighted average interest rate of 2.900%. For the period from March 19, 2021 to September 30, 2021, the Company recorded interest expense (inclusive of fees) of $0.3 million related to the Deutsche Bank Facility. 2025 Notes On February 25, 2020, the Company issued $300.0 million in aggregate principal amount of the 2025 Notes for net proceeds of $293.8 million after deducting OID of $2.5 million, underwriting commissions and discounts of $3.0 million and offering costs of $0.7 million. The OID on the 2025 Notes is amortized based on the effective interest method over the term of the 2025 Notes. The 2025 Notes were issued pursuant to an indenture, dated April 30, 2012, as supplemented by the fifth supplemental indenture, dated February 25, 2020 (collectively, the "2025 Notes Indenture"), between the Company and Deutsche Bank Trust Company Americas (the "Trustee"). The 2025 Notes are the Company's general unsecured obligations that rank senior in right of payment to all of the Company's existing and future indebtedness that is expressly subordinated in right of payment to the 2025 Notes. The 2025 Notes rank equally in right of payment with all of the Company's existing and future liabilities that are not so subordinated. The 2025 Notes effectively rank junior to any of the Company's secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness. The 2025 Notes rank structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company's subsidiaries, financing vehicles or similar facilities. Interest on the 2025 Notes is paid semi-annually on February 25 and August 25 at a rate of 3.500% per annum. The 2025 Notes mature on February 25, 2025 and may be redeemed in whole or in part at any time or from time to time at the Company's option prior to maturity at par plus a “make-whole” premium, if applicable. In addition, holders of the 2025 Notes can require the Company to repurchase the 2025 Notes at 100% of their principal amount upon the occurrence of certain change of control events as described in the 2025 Notes Indenture. The 2025 Notes were issued in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof. During the year ended September 30, 2021, the Company did not repurchase any of the 2025 Notes in the open market. The 2025 Notes Indenture contains certain covenants, including covenants requiring the Company's compliance with the asset coverage requirements set forth in Section 18(a)(1)(A) as modified by Section 61(a)(1) and (2) of the Investment Company Act or any successor provisions (but giving effect to any exemptive relief granted to the Company by the U.S. Securities and Exchange Commission ("SEC")), as well as covenants requiring the Company to provide financial information to 138 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) the holders of the 2025 Notes and the Trustee if the Company ceases to be subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These covenants are subject to limitations and exceptions that are described in the 2025 Notes Indenture. 2027 Notes On May 18, 2021, the Company issued $350.0 million in aggregate principal amount of the 2027 Notes for net proceeds of $344.8 million after deducting OID of $1.0 million, underwriting commissions and discounts of $3.5 million and offering costs of $0.7 million. The OID on the 2027 Notes is amortized based on the effective interest method over the term of the 2027 Notes. The 2027 Notes were issued pursuant to an indenture, dated April 30, 2012, as supplemented by the sixth supplemental indenture, dated May 18, 2021 (collectively, the "2027 Notes Indenture"), between the Company and the Trustee. The 2027 Notes are the Company's general unsecured obligations that rank senior in right of payment to all of the Company's existing and future indebtedness that is expressly subordinated in right of payment to the 2027 Notes. The 2027 Notes rank equally in right of payment with all of the Company's existing and future liabilities that are not so subordinated. The 2027 Notes effectively rank junior to any of the Company's secured indebtedness (including unsecured indebtedness that the Company later secures) to the extent of the value of the assets securing such indebtedness. The 2027 Notes rank structurally junior to all existing and future indebtedness (including trade payables) incurred by the Company's subsidiaries, financing vehicles or similar facilities. Interest on the 2027 Notes is paid semi-annually on January 15 and July 15, beginning on January 15, 2022, at a rate of 2.700% per annum. The 2027 Notes mature on January 15, 2027 and may be redeemed in whole or in part at any time or from time to time at the Company's option prior to maturity at par plus a “make-whole” premium, if applicable. In addition, holders of the 2027 Notes can require the Company to repurchase the 2027 Notes at 100% of their principal amount upon the occurrence of certain change of control events as described in the 2027 Notes Indenture. The 2027 Notes were issued in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof. During the year ended September 30, 2021, the Company did not repurchase any of the 2027 Notes in the open market. The 2027 Notes Indenture contains certain covenants, including covenants requiring the Company's compliance with the asset coverage requirements set forth in Section 18(a)(1)(A) as modified by Section 61(a)(1) and (2) of the Investment Company Act or any successor provisions (but giving effect to any exemptive relief granted to the Company by the SEC), as well as covenants requiring the Company to provide financial information to the holders of the 2027 Notes and the Trustee if the Company ceases to be subject to the reporting requirements of the Exchange Act. These covenants are subject to limitations and exceptions that are described in the 2027 Notes Indenture. In connection with the 2027 Notes, the Company entered into an interest rate swap to more closely align the interest rates of its liabilities with its investment portfolio, which consists of predominately floating rate loans. Under the interest rate swap agreement, the Company receives a fixed interest rate of 2.700% and pays a floating interest rate of the three-month LIBOR plus 1.658% on a notional amount of $350 million. The Company designated the interest rate swap as the hedging instrument in an effective hedge accounting relationship. See Note 13 for more information regarding the interest rate swaps. The below table presents the components of the carrying value of the 2025 Notes and the 2027 Notes as of September 30, 2021: As of September 30, 2021 ($ in millions) 2025 Notes 2027 Notes Principal $ 300.0 $ 350.0 Unamortized financing costs (2.6) (4.0) Unaccreted discount (1.7) (0.9) Interest rate swap fair value adjustment — (2.1) Net carrying value $ 295.7 $ 343.0 Fair Value $ 314.5 $ 351.1 139 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) The below table presents the components of the carrying value of the 2025 Notes as of September 30, 2020: As of September 30, 2020 ($ in millions) 2025 Notes Principal $ 300.0 Unamortized financing costs (3.3) Unaccreted discount (2.2) Net carrying value $ 294.5 Fair Value $ 301.4 The below table presents the components of interest and other debt expenses related to the 2025 Notes and the 2027 Notes for the year ended September 30, 2021: ($ in millions) 2025 Notes 2027 Notes Coupon interest $ 10.5 $ 3.5 Amortization of financing costs and discount 1.3 0.3 Effect of interest rate swap — (1.1) Total interest expense $ 11.8 $ 2.7 Coupon interest rate (net of effect of interest rate swap for 2027 Notes) 3.500 % 1.813 % The below table presents the components of interest and other debt expenses related to the 2025 Notes for the year ended September 30, 2020: ($ in millions) 2025 Notes Coupon interest $ 6.3 Amortization of financing costs and discount 0.7 Total interest expense $ 7.0 Coupon interest rate 3.500 % 2024 Notes On October 18, 2012, the Company issued $75.0 million in aggregate principal amount of the 5.875% notes due 2024 (the "2024 Notes") for net proceeds of $72.5 million after deducting underwriting commissions of $2.2 million and offering costs of $0.3 million. The 2024 Notes were issued pursuant to an indenture, dated April 30, 2012, as supplemented by the first supplemental indenture, dated October 18, 2012, between the Company and the Trustee. Interest on the 2024 Notes was paid quarterly in arrears on January 30, April 30, July 30 and October 30 at a rate of 5.875% per annum. On March 2, 2020, the Company redeemed 100%, or $75.0 million aggregate principal amount, of the issued and outstanding 2024 Notes, following which they were delisted from the New York Stock Exchange. The redemption price per 2024 Note was $25 plus accrued and unpaid interest. The Company recognized a loss of $1.0 million in connection with the redemption of the 2024 Notes during the year ended September 30, 2020. For the years ended September 30, 2020 and 2019, the Company recorded interest expense of $1.9 million and $4.6 million (inclusive of fees), respectively, related to the 2024 Notes. As of September 30, 2021 and September 30, 2020, there were no 2024 Notes outstanding. 2028 Notes In April and May 2013, the Company issued $86.3 million in aggregate principal amount of the 6.125% notes due 2028 (the "2028 Notes") for net proceeds of $83.4 million after deducting underwriting commissions of $2.6 million and offering costs of $0.3 million. The 2028 Notes were issued pursuant to an indenture, dated April 30, 2012, as supplemented by the second supplemental indenture, dated April 4, 2013, between the Company and the Trustee. Interest on the 2028 Notes was paid quarterly in arrears on January 30, April 30, July 30 and October 30 at a rate of 6.125% per annum. On March 13, 2020, the Company redeemed 100%, or $86.3 million aggregate principal amount, of the issued and outstanding 2028 Notes, following which they were delisted from the Nasdaq Global Select Market. The redemption price per 2028 Note was $25 plus accrued and unpaid interest. The Company recognized a loss of $1.5 million in connection with the redemption of the 2028 Notes during the year ended September 30, 2020. 140 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) For the year ended September 30, 2020 and 2019, the Company recorded interest expense of $2.5 million and $5.5 million (inclusive of fees), respectively, related to the 2028 Notes. As of September 30, 2021 and September 30, 2020, there were no 2028 Notes outstanding. Secured Borrowings As of September 30, 2021 and September 30, 2020, the Company did not have any secured borrowings outstanding. On March 19, 2021, as a result of the consummation of the Mergers, the Company became party to a secured borrowing arrangement under which certain securities were sold and simultaneously repurchased at a premium. The amounts due under the secured borrowing arrangement were settled prior to September 30, 2021. For the period from March 19, 2021 to September 30, 2021, the Company recorded less than $0.1 million of interest expense in connection with secured borrowings. The Company's secured borrowings bore interest at a weighted average rate of 3.123% for the period from March 19, 2021 to September 30, 2021. During the year ended September 30, 2019, $7.2 million of secured borrowings were extinguished in exchange for $7.2 million of preferred stock in C5 Technology Holdings, LLC, which was restructured during the year. For the year ended September 30, 2019, the Company recorded interest expense of $0.1 million related to the secured borrowings. For the year ended September 30, 2019, the Company recorded unrealized depreciation on secured borrowings of $2.7 million. For the year ended September 30, 2019, the Company recorded a realized gain of $2.6 million as a result of the extinguishment of secured borrowings in connection with the C5 Technology Holdings, LLC restructuring. Principal Payments Scheduled principal payments for debt obligations as of September 30, 2021 are as follows: Payments due during fiscal years ended September 30, Total 2022 2023 2024 2025 2026 and Thereafter Syndicated Facility $ 495,000 $ — $ — $ — $ — $ 495,000 Citibank Facility 135,000 — — 135,000 — — 2025 Notes 300,000 — — — 300,000 — 2027 Notes 350,000 — — — — 350,000 Total $ 1,280,000 $ — $ — $ 135,000 $ 300,000 $ 845,000 Note 7. Interest Income As of September 30, 2021, there were no investments on non-accrual status . As of September 30, 2020, there were two investments on which the Company had stopped accruing cash and/or PIK interest or OID income. The percentages of the Company's debt investments at cost and fair value by accrual status as of September 30, 2020 were as follows: September 30, 2020 Cost % of Debt Portfolio Fair Value % of Debt Portfolio Accrual $ 1,500,364 98.79 % $ 1,483,284 99.89 % PIK non-accrual (1) 12,661 0.83 — — Cash non-accrual (2) 5,712 0.38 1,571 0.11 Total $ 1,518,737 100.00 % $ 1,484,855 100.00 % ___________________ (1) PIK non-accrual status is inclusive of other non-cash income, where applicable. (2) Cash non-accrual status is inclusive of PIK and other non-cash income, where applicable. Note 8. Taxable/Distributable Income and Dividend Distributions Taxable income differs from net increase (decrease) in net assets resulting from operations primarily due to: (1) unrealized appreciation (depreciation) on investments and foreign currency, as gains and losses are not included in taxable income until they are realized; (2) origination and exit fees received in connection with investments in portfolio companies; (3) organizational costs; (4) income or loss recognition on exited investments; and (5) recognition of interest income on certain loans. 141 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) As of September 30, 2021, the Company had net capital loss carryforwards of 547.9 million to offset net capital gains that will not expire, to the extent available and permitted by U.S. federal income tax law, of which $69.1 million are available to offset future short-term capital gains and $478.8 million are available to offset future long-term capital gains. A portion of such net capital loss carryfowards represented a realized loss under IRC 382-383, which is carried forward to future years to offset future gains subject to certain limitations. Listed below is a reconciliation of "net increase (decrease) in net assets resulting from operations" to taxable income for the years ended September 30, 2021 and 2020. Year ended September 30, 2021 Year ended September 30, 2020 Year ended September 30, 2019 Net increase (decrease) in net assets resulting from operations $ 237,260 $ 39,224 $ 126,160 Net unrealized (appreciation) depreciation (114,519) 20,614 (38,457) Book/tax difference due to organizational costs (87) (87) (87) Book/tax difference due to interest income on certain loans — 1,214 3,330 Book/tax difference due to capital losses utilized (41,625) (545) (18,571) Other book/tax differences 11,863 (6,058) (8,111) Taxable/Distributable Income (1) $ 92,892 $ 54,362 $ 64,264 __________ (1) The Company's taxable income for the year ended September 30, 2021 is an estimate and will not be finally determined until the Company files its tax return for the fiscal year ended September 30, 2021. Therefore, the final taxable income may be different than the estimate. The Company uses the liability method to account for its taxable subsidiaries' income taxes. Using this method, the Company recognizes deferred tax assets and liabilities for the estimated future tax effects attributable to temporary differences between financial reporting and tax bases of assets and liabilities. In addition, the Company recognizes deferred tax benefits associated with net loss carry forwards that it may use to offset future tax obligations. The Company measures deferred tax assets and liabilities using the enacted tax rates expected to apply to taxable income in the years in which it expects to recover or settle those temporary differences. When assessing the realizability of deferred tax assets, the Company considers whether it is probable that some or all of the deferred tax assets will not be realized. In determining whether the deferred tax assets are realizable, the Company considers the period of expiration of the tax asset, historical and projected taxable income and tax liabilities for the tax jurisdiction in which the tax asset is located. The deferred tax asset recognized by the Company, as it relates to the higher tax basis in the carrying value of certain assets compared to the book basis of those assets, will be recognized in future years by these taxable entities. Deferred tax assets are based on the amount of the tax benefit that the Company’s management has determined is more likely than not to be realized in future periods. In determining the realizability of this tax benefit, management considered numerous factors that will give rise to pre-tax income in future periods. Among these are the historical and expected future book and tax basis pre-tax income of the Company and unrealized gains in the Company’s assets at the determination date. Based on these and other factors, the Company determined that, as of September 30, 2021, $0.3 million of the $1.0 million deferred tax assets would not more likely than not be realized in future periods. As of September 30, 2021, the Company recorded a net deferred tax asset of $0.7 million on the Consolidated Statements of Assets and Liabilities. For the year ended September 30, 2021, the Company recognized a total provision for income tax related to realized and unrealized gains of $0.8 million, which was composed of (i) a current income tax expense of approximately $0.7 million, and (ii) a deferred income tax expense of approximately $0.1 million, which resulted from unrealized appreciation on investments held by the Company’s wholly-owned taxable subsidiaries. For the year ended September 30, 2021, the Company recognized a provision for income tax related to net investment income of $2.8 million, which was all current income tax expense. For the year ended September 30, 2020, the Company recognized a total provision for income tax benefit of $1.8 million, which was comprised of (i) a current income tax benefit of approximately $0.2 million, and (ii) a deferred income tax benefit of approximately $1.6 million, which resulted from unrealized depreciation on investments held by the Company’s wholly-owned taxable subsidiaries. For the year ended September 30, 2019, the Company recognized a total provision for income taxes of $1.0 million, which was comprised of (i) current income tax expense of approximately $0.7 million, primarily as a result of realized gains on investments held by the Company's wholly-owned taxable subsidiaries, net of return to provision adjustments, and (ii) deferred income tax expense of approximately $0.3 million, which resulted from unrealized appreciation on investments held by the Company’s wholly-owned taxable subsidiaries. 142 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) For the year ended September 30, 2021, the Company reclassified $74.3 million, respectively, of accumulated overdistributed earnings to additional paid-in-capital on the Consolidated Statement of Assets and Liabilities related to the merger with OCSI. These reclassification entries did not impact total net assets. As of September 30, 2021, the Company's last tax year end, the components of accumulated overdistributed earnings on a tax basis were as follows: Undistributed ordinary income, net $ (20,260) Net realized capital losses 497,255 Unrealized losses, net 16,340 Accumulated overdistributed earnings $ 493,335 The aggregate cost of investments for U.S. federal income tax purposes was $2.6 billion as of September 30, 2021. As of September 30, 2021, the aggregate gross unrealized appreciation for all investments in which there was an excess of value over cost for U.S. federal income tax purposes was $409.5 million. As of September 30, 2021, the aggregate gross unrealized depreciation for all investments in which there was an excess of cost for U.S. federal income tax purposes over value was $425.8 million. Net unrealized depreciation based on the aggregate cost of investments for U.S. federal income tax purposes was $16.3 million. Note 9. Realized Gains or Losses and Net Unrealized Appreciation or Depreciation Realized Gains or Losses Realized gains or losses are measured by the difference between the net proceeds from the sale or redemption and the cost basis of the investment without regard to unrealized appreciation or depreciation previously recognized, and include investments written-off during the period, net of recoveries. Realized losses may also be recorded in connection with the Company's determination that certain investments are considered worthless securities and/or meet the conditions for loss recognition per the applicable tax rules. 143 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) During the year ended September 30, 2021, the Company recorded an aggregate net realized gain of $26.4 million, which consisted of the following: ($ in millions) Portfolio Company Net Realized Gain (Loss) PLATO Learning Inc. $ 7.8 Keypath Education Holdings, LLC 6.8 L Squared Capital Partners LLC 3.4 LTI Holdings, Inc. 2.6 BX Commercial Mortgage Trust 2020-VIVA 2.6 California Pizza Kitchen Inc. (1.8) Refac Optical Group (1.3) Other, net 6.3 Total, net $ 26.4 During the year ended September 30, 2020, the Company recorded an aggregate net realized loss of $13.9 million, which consisted of the following: ($ in millions) Portfolio Company Net Realized Gain (Loss) Cenegenics, LLC $ (29.2) Dominion Diagnostics, LLC (15.6) Thruline Marketing Inc. (4.9) Covia Holdings Corporation (3.3) YETI Holdings, Inc. 17.6 Sorrento Therapeutics, Inc. 11.5 Lytx Holdings, LLC 5.2 Goodrx Holdings Inc. 2.1 HealthEdge Software, Inc. 1.8 Other, net 0.9 Total, net $ (13.9) During the year ended September 30, 2019, the Company recorded an aggregate net realized gain of $20.8 million, which consisted of the following: ($ in millions) Portfolio Company Net Realized Gain (Loss) Maverick Healthcare Group, LLC $ 17.5 BeyondTrust Holdings LLC 12.4 Comprehensive Pharmacy Services LLC 7.6 Refac Optical Group 7.5 YETI Holdings, Inc. 5.3 InMotion Entertainment Group, LLC 3.0 Advanced Pain Management (22.5) Thing5, LLC (net of secured borrowings) (11.1) Weatherford International (3.3) Other, net 4.4 Total, net $ 20.8 Net Unrealized Appreciation or Depreciation Net unrealized appreciation or depreciation reflects the net change in the valuation of the portfolio pursuant to the Company's valuation guidelines and the reclassification of any prior period unrealized appreciation or depreciation. 144 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) During the years ended September 30, 2021, 2020 and 2019, the Company recorded net unrealized appreciation (depreciation) of $114.5 million, $(20.6) million and $38.5 million, respectively. For the year ended September 30, 2021, this consisted of $70.0 million of net unrealized appreciation on debt investments, $36.3 million of net unrealized appreciation on equity investments, $6.6 million of net unrealized appreciation related to exited investments (a portion of which resulted in a reclassification to realized losses) and $1.7 million of net unrealized appreciation of foreign currency forward contracts. For the year ended September 30, 2020, this consisted of $35.3 million of net unrealized depreciation on equity investments, $12.0 million of net unrealized depreciation on debt investments and $0.3 million of net unrealized depreciation of foreign currency forward contracts, partially offset by $26.9 million of net unrealized appreciation related to exited investments (a portion of which resulted in a reclassification to realized losses). For the year ended September 30, 2019, this consisted of $57.0 million of net unrealized appreciation related to exited investments (a portion of which results in a reclassification to realized losses), $10.6 million of net unrealized appreciation on equity investments and $0.3 million net unrealized appreciation of foreign currency forward contracts, partially offset by $26.8 million of net unrealized depreciation on debt investments and $2.7 million of net unrealized depreciation of secured borrowings (which results in a reclassification to realized gains). For the year ended September 30, 2021, there were $22.8 million of net realized and unrealized gains (losses) that resulted solely from accounting adjustments related to the Mergers. Note 10. Concentration of Credit Risks The Company deposits its cash with financial institutions and at times such balances may be in excess of the FDIC insurance limit. The Company limits its exposure to credit loss by depositing its cash with high credit quality financial institutions and monitoring their financial stability. Note 11. Related Party Transactions As of September 30, 2021 and September 30, 2020, the Company had a liability on its Consolidated Statements of Assets and Liabilities in the amount of $32.6 million and $11.2 million, respectively, reflecting the unpaid portion of the base management fees and incentive fees payable to Oaktree. Investment Advisory Agreement The Company is party to the Investment Advisory Agreement. Under the Investment Advisory Agreement, the Company pays Oaktree a fee for its services under the Investment Advisory Agreement consisting of two components: a base management fee and an incentive fee. The cost of both the base management fee payable to Oaktree and any incentive fees earned by Oaktree is ultimately borne by common stockholders of the Company. From October 17, 2017 through May 3, 2020, the Company was externally managed by OCM pursuant to an investment advisory agreement. On May 4, 2020, OCM effected the novation of such investment advisory agreement to Oaktree. Immediately following such novation, the Company and Oaktree entered into a new investment advisory agreement with the same terms, including fee structure, as the investment advisory agreement with OCM. The investment advisory agreement with Oaktree was subsequently amended and restated on March 19, 2021 in connection with the closing of the Mergers. The term “Investment Advisory Agreement” refers collectively to the agreements with Oaktree and, prior to its novation, with OCM. Unless earlier terminated as described below, the Investment Advisory Agreement will remain in effect from year-to-year if approved annually by the Board of Directors of the Company or by the affirmative vote of the holders of a majority of the Company’s outstanding voting securities, including, in either case, approval by a majority of the directors of the Company who are not interested persons. The Investment Advisory Agreement will automatically terminate in the event of its assignment. The Investment Advisory Agreement may be terminated by either party without penalty upon 60 days’ written notice to the other. The Investment Advisory Agreement may also be terminated, without penalty, upon the vote of a majority of the outstanding voting securities of the Company. Base Management Fee Under the Investment Advisory Agreement, the base management fee is calculated at an annual rate of 1.50% of total gross assets, including any investment made with borrowings, but excluding cash and cash equivalents. The base management fee is payable quarterly in arrears and the fee for any partial month or quarter is appropriately prorated. Effective May 3, 2019, the base management fee on the Company’s gross assets, including any investments made with borrowings, but excluding any cash and cash equivalents, that exceed the product of (A) 200% and (B) the Company’s net asset value will be 1.00%. For the avoidance of doubt, the 200% will be calculated in accordance with the Investment Company Act and will give effect to 145 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) exemptive relief the Company received from the SEC with respect to debentures issued by a small business investment company subsidiary. In connection with the Mergers, the Company and Oaktree entered into an amended and restated investment advisory agreement, which among other items, waived an aggregate of $6 million of base management fees otherwise payable to Oaktree in the two years following the closing of the Mergers on March 19, 2021 at a rate of $750,000 per quarter (with such amount appropriately prorated for any partial quarter). For the years ended September 30, 2021, 2020 and 2019, the base management fee incurred under the Investment Advisory Agreement was $30.7 million (net of waiver), $22.9 million and $22.2 million, respectively. Incentive Fee The incentive fee consists of two parts. Under the Investment Advisory Agreement, the first part of the incentive fee (the “incentive fee on income” or "Part I incentive fee") is calculated and payable quarterly in arrears based upon the “pre-incentive fee net investment income” of the Company for the immediately preceding quarter. The payment of the incentive fee on income is subject to payment of a preferred return to investors each quarter (i.e., a “hurdle rate”), expressed as a rate of return on the value of the Company’s net assets at the end of the most recently completed quarter, of 1.50%, subject to a “catch up” feature. For this purpose, “pre-incentive fee net investment income” means interest income, dividend income and any other income (including any other fees such as commitment, origination, structuring, diligence and consulting fees or other fees that the Company receives from portfolio companies, other than fees for providing managerial assistance) accrued during the fiscal quarter, minus the Company’s operating expenses for the quarter (including the base management fee, expenses payable under the Administration Agreement and any interest expense and dividends paid on any issued and outstanding preferred stock, but excluding the incentive fee). Pre-incentive fee net investment income includes, in the case of investments with a deferred interest feature (such as OID debt, instruments with PIK interest and zero coupon securities), accrued income that the Company has not yet received in cash. Pre-incentive fee net investment income does not include any realized capital gains, realized capital losses or unrealized capital appreciation or depreciation. In addition, pre-incentive fee net investment income does not include any amortization or accretion of any purchase premium or purchase discount to interest income resulting solely from merger-related accounting adjustments in connection with the assets acquired in the Mergers, including any premium or discount paid for the acquisition of such assets, solely to the extent that the inclusion of such merger-related accounting adjustments, in the aggregate, would result in an increase in pre-incentive fee net investment income. Under the Investment Advisory Agreement, the calculation of the incentive fee on income for each quarter is as follows: • No incentive fee is payable to Oaktree in any quarter in which the Company’s pre-incentive fee net investment income does not exceed the preferred return rate of 1.50% (the “preferred return”) on net assets; • 100% of the Company’s pre-incentive fee net investment income, if any, that exceeds the preferred return but is less than or equal to 1.8182% in any fiscal quarter is payable to Oaktree. This portion of the incentive fee on income is referred to as the “catch-up” provision, and it is intended to provide Oaktree with an incentive fee of 17.5% on all of the Company’s pre-incentive fee net investment income when the Company’s pre-incentive fee net investment income exceeds 1.8182% on net assets in any fiscal quarter; and • For any quarter in which the Company’s pre-incentive fee net investment income exceeds 1.8182% on net assets, the incentive fee on income is equal to 17.5% of the amount of the Company’s pre-incentive fee net investment income, as the preferred return and catch-up will have been achieved. There is no accumulation of amounts on the hurdle rate from quarter to quarter and accordingly there is no clawback of amounts previously paid if subsequent quarters are below the quarterly hurdle. For the years ended September 30, 2021, 2020 and 2019, the first part of the incentive fee (incentive fee on income) incurred under the Investment Advisory Agreement was $21.6 million, $15.2 million and $14.9 million, respectively. Under the Investment Advisory Agreement, the second part of the incentive fee (the "capital gains incentive fee") is determined and payable in arrears as of the end of each fiscal year (or upon termination of the Investment Advisory Agreement, as of the termination date) commencing with the fiscal year ended September 30, 2019 and equals 17.5% of the Company’s realized capital gains, if any, on a cumulative basis from the beginning of the fiscal year ended September 30, 2019 through the end of each subsequent fiscal year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees under the Investment Advisory Agreement. Any realized capital gains, realized capital losses, unrealized capital appreciation and unrealized capital depreciation with respect to the Company’s portfolio as of the end of the fiscal year ended September 30, 2018 are excluded from the calculations of the second part of the incentive fee. In addition, the calculation of realized capital gains, realized capital 146 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) losses and unrealized capital depreciation does (1) not include any such amounts resulting solely from merger-related accounting adjustments in connection with the assets acquired in the Mergers, including any premium or discount paid for the acquisition of such assets, solely to the extent that the inclusion of such merger-related accounting adjustments, in the aggregate, would result in an increase in the capital gains incentive fee and (2) include any such amounts associated with the investments acquired in the Mergers for the period from October 1, 2018 to the date of closing of the Mergers, solely to the extent that the exclusion of such amounts, in the aggregate, would result in an increase in the capital gains incentive fee. For the year ended September 30, 2021, the Company incurred $8.8 million of capital gains incentive fees under the Investment Advisory Agreement. For the year ended September 30, 2020, the Company did not incur any capital gains incentive fees under the Investment Advisory Agreement. For the year ended September 30, 2019, the Company incurred $4.6 million of capital gains incentive fees under the Investment Advisory Agreement (prior to waivers). GAAP requires that the capital gains incentive fee accrual consider the cumulative aggregate unrealized capital appreciation in the calculation, as a capital gains incentive fee would be payable if such unrealized capital appreciation were realized on a theoretical "liquidation basis." A fee so calculated and accrued would not be payable under applicable law and may never be paid based upon the computation of capital gains incentive fees in subsequent periods. Amounts ultimately paid under the Investment Advisory Agreement will be consistent with the formula reflected in the Investment Advisory Agreement. This GAAP accrual is calculated using the aggregate cumulative realized capital gains and losses and aggregate cumulative unrealized capital depreciation included in the calculation of the capital gains incentive fee plus the aggregate cumulative unrealized capital appreciation. Any realized capital gains and losses and cumulative unrealized capital appreciation and depreciation with respect to the Company’s portfolio as of the end of the fiscal year ended September 30, 2018 are excluded from the GAAP accrual. If such amount is positive at the end of a period, then GAAP requires the Company to record a capital gains incentive fee equal to 17.5% of such cumulative amount, less the aggregate amount of actual capital gains incentive fees payable or capital gains incentive fees accrued under GAAP in all prior periods. The resulting accrual for any capital gains incentive fee under GAAP in a given period may result in an additional expense if such cumulative amount is greater than in the prior period or a reversal of previously recorded expense if such cumulative amount is less than in the prior period. If such cumulative amount is negative, then there is no accrual. There can be no assurance that such unrealized capital appreciation will be realized in the future or any accrued capital gains incentive fee will become payable under the Investment Advisory Agreement. For the year ended September 30, 2021, $17.6 million of accrued capital gains incentive fees were expensed. For the year ended September 30, 2020, the Company reversed $5.6 million of previously accrued capital gains incentive fees. For the year ended September 30, 2019, $10.2 million of accrued capital gains incentive fees were expensed (prior to waivers). As of September 30, 2021, the total accrued capital gains incentive fee liability was $17.6 million. To ensure compliance with Section 15(f) of the Investment Company Act, OCM entered into a two-year contractual fee waiver with the Company, which ended on October 17, 2019, pursuant to which OCM waived any management or incentive fees payable under the Investment Advisory Agreement that exceeded what would have been paid to Fifth Street Management LLC (the "Former Adviser") in the aggregate under the investment advisory agreement by and between the Company and the Former Advisor. The contractual amount of fees permanently waived at the end of the two-year period was $3.9 million. Prior to the end of the two-year period, amounts potentially subject to waiver under the two-year contractual fee waiver were accrued quarterly based on a theoretical “liquidation basis.” As of September 30, 2019, the Company had accrued cumulative fee waivers of $9.1 million. During the year ended September 30, 2020, the Company reversed $5.2 million of previously accrued fee waivers since the two-year fee waiver period ended. The following table provides a roll-forward of the accrued waiver balance and illustrates the impact of the end of the two-year contractual fee waiver period: ($ in millions) Accrued fee waivers as of September 30, 2019 (1) $ 9.1 Reversal of previously accrued fee waivers (2) (5.2) Contractual fees waived under the Investment Advisory Agreement (3) (3.9) Accrued fee waivers as of September 30, 2020 $ — (1) Calculated in accordance with GAAP as of September 30, 2019 and is based on a hypothetical liquidation basis. (2) Reflects the reversal of fee waivers that were previously accrued based on a hypothetical liquidation basis when the two-year contractual fee waiver was in effect. This reversal was recognized in connection with the expiration of the two-year contractual fee waiver, which ended on October 17, 2019, and is reflected in reversal of fees waived in the Consolidated Statement of Operations for the year ended September 30, 2020. (3) Reflects the amount of fees permanently waived pursuant to the two-year contractual fee waiver. 147 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) The following table shows the capital gains incentive fee payable under the Investment Advisory Agreement (net of waivers) for the years ended September 30, 2021, 2020 and 2019: ($ in millions) September 30, 2019 (1) September 30, 2020 September 30, 2021 Capital gains incentive fee payable under the Investment Advisory Agreement (prior to waivers) $ 4.6 $ — $ 8.8 Contractual fees waived (3.9) — — Capital gains incentive fee payable under the Investment Advisory Agreement (net of waivers) $ 0.8 $ — $ 8.8 (1) Amounts may not sum due to rounding. Indemnification The Investment Advisory Agreement provides that, absent willful misfeasance, bad faith or gross negligence in the performance of their respective duties or by reason of the reckless disregard of their respective duties and obligations, Oaktree and its officers, managers, partners, members (and their members, including the owners of their members), agents, employees, controlling persons and any other person or entity affiliated with it, are entitled to indemnification from the Company for any damages, liabilities, costs and expenses (including reasonable attorneys' fees and amounts reasonably paid in settlement) arising from the rendering of Oaktree's services under the Investment Advisory Agreement or otherwise as investment adviser. Administrative Services The Company is party to the Administration Agreement with Oaktree Administrator. Pursuant to the Administration Agreement, Oaktree Administrator provides administrative services to the Company necessary for the operations of the Company, which include providing office facilities, equipment, clerical, bookkeeping and record keeping services at such facilities and such other services as Oaktree Administrator, subject to review by the Company’s Board of Directors, shall from time to time deem to be necessary or useful to perform its obligations under the Administration Agreement. Oaktree Administrator may, on behalf of the Company, conduct relations and negotiate agreements with custodians, trustees, depositories, attorneys, underwriters, brokers and dealers, corporate fiduciaries, insurers, banks and such other persons in any such other capacity deemed to be necessary or desirable. Oaktree Administrator makes reports to the Company’s Board of Directors of its performance of obligations under the Administration Agreement and furnishes advice and recommendations with respect to such other aspects of the Company’s business and affairs, in each case, as it shall determine to be desirable or as reasonably required by the Company’s Board of Directors; provided that Oaktree Administrator shall not provide any investment advice or recommendation. Oaktree Administrator also provides portfolio collection functions for interest income, fees and warrants and is responsible for the financial and other records that the Company is required to maintain and prepares, prints and disseminates reports to the Company’s stockholders and all other materials filed with the SEC. In addition, Oaktree Administrator assists the Company in determining and publishing the Company’s net asset value, overseeing the preparation and filing of the Company’s tax returns, and generally overseeing the payment of the Company’s expenses and the performance of administrative and professional services rendered to the Company by others. Oaktree Administrator may also offer to provide, on the Company’s behalf, managerial assistance to the Company’s portfolio companies. For providing these services, facilities and personnel, the Company reimburses Oaktree Administrator the allocable portion of overhead and other expenses incurred by Oaktree Administrator in performing its obligations under the Administration Agreement, including the Company’s allocable portion of the rent of the Company’s principal executive offices (which are located in a building owned by a Brookfield affiliate) at market rates and the Company’s allocable portion of the costs of compensation and related expenses of its Chief Financial Officer, Chief Compliance Officer, their staffs and other non-investment professionals at Oaktree that perform duties for the Company. Such reimbursement is at cost, with no profit to, or markup by, Oaktree Administrator. The Administration Agreement may be terminated by either party without penalty upon 60 days’ written notice to the other. The Administration Agreement may also be terminated, without penalty, upon the vote of a majority of the Company’s outstanding voting securities. For the years ended September 30, 2021, 2020 and 2019, the Company accrued administrative expenses of $1.7 million, $1.8 million and $2.3 million, respectively, including $0.2 million, $0.3 million and $0.3 million of general and administrative expenses, respectively. 148 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) As of September 30, 2021 and September 30, 2020, $4.4 million and $2.1 million, respectively, was included in “Due to affiliate” in the Consolidated Statements of Assets and Liabilities, reflecting the unpaid portion of administrative expenses and other reimbursable expenses payable to Oaktree Administrator. 149 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Note 12. Financial Highlights (Share amounts in thousands) Year ended September 30, 2021 Year ended September 30, 2020 Year ended September 30, 2019 Year ended September 30, 2018 (1) Year ended September 30, 2017 Net asset value per share at beginning of period $6.49 $6.60 $6.09 $6.16 $7.97 Net investment income (2) 0.60 0.51 0.48 0.43 0.51 Net unrealized appreciation (depreciation) (2)(3) 0.73 (0.14) 0.27 0.73 (0.69) Net realized gains (losses) (2) 0.16 (0.10) 0.14 (0.83) (1.21) (Provision) benefit for taxes on realized and unrealized gains (losses) (2) — 0.01 — — — Distributions of net investment income to stockholders (0.51) (0.39) (0.38) (0.27) (0.47) Tax return of capital — — — (0.13) — Issuance of common stock (0.19) — — — 0.05 Net asset value per share at end of period $7.28 $6.49 $6.60 $6.09 $6.16 Per share market value at beginning of period $4.84 $5.18 $4.96 $5.47 $5.81 Per share market value at end of period $7.06 $4.84 $5.18 $4.96 $5.47 Total return (4) 57.61% 2.10% 12.56% (1.49)% 2.84% Common shares outstanding at beginning of period 140,961 140,961 140,961 140,961 143,259 Common shares outstanding at end of period 180,361 140,961 140,961 140,961 140,961 Net assets at beginning of period $914,879 $930,630 $858,035 $867,657 $1,142,288 Net assets at end of period $1,312,823 $914,879 $930,630 $858,035 $867,657 Average net assets (5) $1,150,662 $871,305 $909,264 $841,583 $1,018,498 Ratio of net investment income to average net assets (5) 8.44% 8.26% 7.47% 7.13% 7.13% Ratio of total expenses to average net assets (5) 9.65% 7.57% 9.65% 9.51% 10.49% Ratio of net expenses to average net assets (5) 9.51% 8.16% 8.78% 9.35% 10.35% Ratio of portfolio turnover to average investments at fair value 39.66% 38.99% 32.50% 67.66% 39.06% Weighted average outstanding debt (6) $964,390 $647,080 $573,891 $608,553 $982,372 Average debt per share (2) $5.95 $4.59 $4.07 $4.32 $6.95 Asset coverage ratio at end of period (7) 201.68% 227.22% 294.91% 232.98% 227.40% __________ (1) Beginning on October 17, 2017, the Company is externally managed by Oaktree or its affiliates. Prior to October 17, 2017, the Company was externally managed by the Former Adviser. (2) Calculated based upon weighted average shares outstanding for the period. (3) For the year ended September 30, 2021, the amount shown for net unrealized appreciation (depreciation) includes the effect of the timing of common stock issuances in connection with the Mergers. (4) Total return equals the increase or decrease of ending market value over beginning market value, plus distributions, divided by the beginning market value, assuming dividend reinvestment prices obtained under the Company's DRIP. Total return does not include sales load. (5) Calculated based upon the weighted average net assets for the period. (6) Calculated based upon the weighted average of principal debt outstanding for the period. (7) Based on outstanding senior securities of $1,280.0 million, $714.8 million, $476.1 million, $643.4 million and $680.7 million as of September 30, 2021, 2020, 2019, 2018 and 2017, respectively. 150 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Senior Securities Information about our senior securities (including debt securities and other indebtedness) is shown in the following table as of the fiscal years ended September 30 for the years indicated below. We had no senior securities outstanding as of September 30 of any prior fiscal years prior to those indicated below. Class and Year(1) Total Amount Outstanding Exclusive of Treasury Securities (2) Asset Coverage Per Unit(3) Involuntary Liquidating Preference Per Unit(4) Average Market Value Per Unit(5) Syndicated Facility and Prior ING Facility Fiscal 2012 $ 141,000 3,857 — N/A Fiscal 2013 168,000 3,949 — N/A Fiscal 2014 267,395 2,595 — N/A Fiscal 2015 383,495 2,389 — N/A Fiscal 2016 472,495 2,208 — N/A Fiscal 2017 226,495 2,274 — N/A Fiscal 2018 241,000 2,330 — N/A Fiscal 2019 314,825 2,949 — N/A Fiscal 2020 414,825 2,272 — N/A Fiscal 2021 495,000 2,017 — N/A Citibank Facility Fiscal 2021 $ 135,000 2,017 Wells Fargo Facility Fiscal 2012 $ 60,251 3,857 — N/A Fiscal 2013 20,000 3,949 — N/A Sumitomo Facility Fiscal 2012 $ — 3,857 — N/A Fiscal 2013 — 3,949 — N/A Fiscal 2014 50,000 2,595 — N/A Fiscal 2015 43,800 2,389 — N/A Fiscal 2016 43,800 2,208 — N/A Fiscal 2017 29,500 2,274 — N/A Convertible Notes Fiscal 2012 $ 115,000 3,857 — N/A Fiscal 2013 115,000 3,949 — N/A Fiscal 2014 115,000 2,595 — N/A Fiscal 2015 115,000 2,389 — N/A Secured Borrowings Fiscal 2014 $ 84,750 2,595 — N/A Fiscal 2015 21,787 2,389 — N/A Fiscal 2016 18,929 2,208 — N/A Fiscal 2017 13,489 2,274 — N/A Fiscal 2018 12,314 2,330 — N/A 151 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Class and Year(1) Total Amount Outstanding Exclusive of Treasury Securities (in thousands)(2) Asset Coverage Per Unit(3) Involuntary Liquidating Preference Per Unit(4) Average Market Value Per Unit(5) 2019 Notes Fiscal 2014 $ 250,000 2,595 — N/A Fiscal 2015 250,000 2,389 — N/A Fiscal 2016 250,000 2,208 — N/A Fiscal 2017 250,000 2,274 — N/A Fiscal 2018 228,825 2,330 — N/A 2024 Notes Fiscal 2013 $ 75,000 3,949 — 979.45 Fiscal 2014 75,000 2,595 — 966.96 Fiscal 2015 75,000 2,389 — 991.94 Fiscal 2016 75,000 2,208 — 993.70 Fiscal 2017 75,000 2,274 — 1,006.74 Fiscal 2018 75,000 2,330 — 1,010.72 Fiscal 2019 75,000 2,949 — 1,012.76 2025 Notes Fiscal 2020 $ 300,000 2,272 — N/A Fiscal 2021 300,000 2,017 — N/A 2027 Notes Fiscal 2021 $ 350,000 2,017 — N/A 2028 Notes Fiscal 2013 $ 86,250 3,949 — 957.21 Fiscal 2014 86,250 2,595 — 943.73 Fiscal 2015 86,250 2,389 — 988.06 Fiscal 2016 86,250 2,208 — 999.29 Fiscal 2017 86,250 2,274 — 1,007.51 Fiscal 2018 86,250 2,330 — 994.82 Fiscal 2019 86,250 2,949 — 993.33 Total Senior Securities Fiscal 2012 $ 316,251 3,857 — Fiscal 2013 464,250 3,949 — Fiscal 2014 928,395 2,595 — Fiscal 2015 975,332 2,389 — Fiscal 2016 946,474 2,208 — Fiscal 2017 680,734 2,274 — Fiscal 2018 643,389 2,330 — Fiscal 2019 476,075 2,949 — Fiscal 2020 714,825 2,272 — Fiscal 2021 1,280,000 2,017 — 152 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) ______________ (1) This table excludes any SBA-guaranteed debentures outstanding during the relevant periods because the SEC has granted the Company exemptive relief that permits it to exclude such debentures from the definition of senior securities in the asset coverage ratio the Company is required to maintain under the Investment Company Act. (2) Total amount of each class of senior securities outstanding at the end of the period, presented in thousands. (3) The asset coverage ratio for a class of senior securities representing indebtedness is calculated as the Company's consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by total senior securities representing indebtedness. This asset coverage ratio is multiplied by $1,000 to determine the “Asset Coverage Per Unit.” (4) The amount to which such class of senior security would be entitled upon the involuntary liquidation of the issuer in preference to any security junior to it. The “-” indicates information that the Securities and Exchange Commission expressly does not require to be disclosed for certain types of senior securities. (5) Calculated on a daily average basis. 153 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Note 13. Derivative Instruments The Company enters into foreign currency forward contracts from time to time to help mitigate the impact that an adverse change in foreign exchange rates would have on the value of the Company’s investments denominated in foreign currencies. In order to better define its contractual rights and to secure rights that will help the Company mitigate its counterparty risk, the Company entered into an International Swaps and Derivatives Association, Inc. Master Agreement (the "ISDA Master Agreement") with its derivative counterparty, JPMorgan Chase Bank, N.A. The ISDA Master Agreement permits a single net payment in the event of a default or similar event. As of September 30, 2021, no cash collateral has been pledged to cover obligations and no cash collateral has been received from the counterparty with respect to the Company's forward currency contracts. During the year ended September 30, 2021, in connection with the issuance of the 2027 Notes, the Company entered into an interest rate swap agreement with the Royal Bank of Canada pursuant to an ISDA Master Agreement. As of September 30, 2021, the Company paid $1.6 million to the Royal Bank of Canada to cover collateral obligations under the terms of the interest swap agreement, which is included in due from broker on the Consolidated Statement of Assets and Liabilities. Certain information related to the Company’s foreign currency forward contracts is presented below as of September 30, 2021. Description Notional Amount to be Purchased Notional Amount to be Sold Maturity Date Gross Amount of Recognized Assets Gross Amount of Recognized Liabilities Balance Sheet Location of Net Amounts Foreign currency forward contract $ 52,186 £ 37,709 11/12/2021 $ 1,339 $ — Derivative asset Foreign currency forward contract $ 46,663 € 39,736 11/12/2021 $ 573 $ — Derivative asset $ 1,912 $ — Certain information related to the Company’s foreign currency forward contracts is presented below as of September 30, 2020. Description Notional Amount to be Purchased Notional Amount to be Sold Maturity Date Gross Amount of Recognized Assets Gross Amount of Recognized Liabilities Balance Sheet Location of Net Amounts Foreign currency forward contract $ 35,577 £ 27,494 11/12/2020 $ 25 $ — Derivative asset Foreign currency forward contract $ 30,260 € 25,614 11/12/2020 $ 198 $ — Derivative asset $ 223 $ — Certain information related to the Company’s interest rate swap is presented below as of September 30, 2021. Description Notional Amount Maturity Date Gross Amount of Recognized Assets Gross Amount of Recognized Liabilities Balance Sheet Location of Net Amounts Interest rate swap $ 350,000 1/15/2027 $ — $ 2,108 Derivative liability $ — $ 2,108 There was no interest rate swap as of September 30, 2020. Note 14. Commitments and Contingencies Merger Litigation On December 18, 2020, putative stockholder Oklahoma Firefighters Pension and Retirement System filed a complaint on behalf of itself and all other similarly situated holders of the Company’s common stock and derivatively on behalf of the Company as nominal defendant in the Delaware Court of Chancery, captioned Oklahoma Firefighters Pension and Retirement System v. Frank, et al., No. 2020-1075-VCM (Del. Ch.). This lawsuit is referred to herein as the “Merger Litigation”. The Merger Litigation alleges a direct breach of fiduciary duty claim against the Board of Directors in connection with the solicitation of the approval by the Company’s stockholders of the issuance of shares of the Company’s common stock to be issued pursuant to the Merger Agreement and a derivative breach of fiduciary duty claim against the Board of Directors in connection with its negotiation and approval of the Mergers. The Merger Litigation alleges, among other things, that the members of the Board of Directors had certain conflicts of interest in the negotiation and approval of the Mergers and that the 154 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) initial filing of the joint proxy statement/prospectus relating to the Mergers omitted certain information that the plaintiff claims is material. The Merger Litigation, among other things, requested that the court enjoin the vote of the Company’s stockholders with respect to the approval of the issuance of shares of the Company’s common stock to be issued pursuant to the Merger Agreement and award attorneys’ fees and damages in an unspecified amount. On February 16, 2021, the plaintiff withdrew the request that the court enjoin the vote of the Company’s stockholders. On April 26, 2021, putative stockholder Oklahoma Firefighters Pension and Retirement System filed a proposed order voluntarily dismissing its claims surrounding the Mergers, with prejudice as to the plaintiff and without prejudice as to any other stockholder of the Company. The court entered the order of dismissal on May 10, 2021. The Court retained jurisdiction solely for the purpose of adjudicating the anticipated application of plaintiff’s counsel for an award of attorneys’ fees and reimbursement of expenses in connection with the supplemental disclosures included in the amended joint proxy statement/prospectus. The Company subsequently agreed to pay $0.4 million to plaintiff’s counsel for attorneys’ fees and expenses in full satisfaction of the claim for attorneys’ fees and expenses in the action. For the year ended September 30, 2021, the Company recognized a $0.4 million loss in connection with the litigation matter described above. In connection with the lawsuit, the Company incurred professional fees of $0.8 million during the year ended September 30, 2021. Additionally, the Company determined that it is probable that it will receive $0.7 million of insurance recoveries in connection with such loss and professional fees incurred and has recognized such amount for the year ended September 30, 2021. The Company received such insurance recoveries subsequent to September 30, 2021. Off-Balance Sheet Arrangements The Company may be a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financial needs of its portfolio companies. As of September 30, 2021, the Company's only off-balance sheet arrangements consisted of $264.9 million of unfunded commitments, which was comprised of $212.4 million to provide debt and equity financing to certain of its portfolio companies, $49.0 million to provide financing to the JVs and $3.5 million related to unfunded limited partnership interests. As of September 30, 2020, the Company's only off-balance sheet arrangements consisted of $157.5 million of unfunded commitments, which was comprised of $152.7 million to provide debt financing to certain of its portfolio companies, $1.3 million to provide equity financing to SLF JV I and $3.5 million related to unfunded limited partnership interests. Such commitments are subject to the portfolio companies' satisfaction of certain financial and nonfinancial covenants and may involve, to varying degrees, elements of credit risk in excess of the amount recognized in the Company's Consolidated Statements of Assets and Liabilities. 155 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) A list of unfunded commitments by investment (consisting of revolvers, term loans with delayed draw components, subordinated notes and LLC equity interests in the JVs, preferred stock and limited partnership interests) as of September 30, 2021 and September 30, 2020 is shown in the table below: September 30, 2021 September 30, 2020 Senior Loan Fund JV I, LLC $ 35,000 $ 1,328 Assembled Brands Capital LLC 24,868 36,079 Athenex, Inc. 21,072 22,780 Marinus Pharmaceuticals, Inc. 18,349 — RumbleOn, Inc. 16,301 — Ardonagh Midco 3 PLC 14,892 3,007 OCSI Glick JV LLC 13,998 — Dominion Diagnostics, LLC 11,148 5,887 Gulf Operating, LLC 10,064 — Coty Inc. 9,886 — Latam Airlines Group S.A. 7,267 — Sunland Asphalt & Construction, LLC 6,492 — NeuAG, LLC 5,441 4,382 Olaplex, Inc. 4,806 1,917 Mindbody, Inc. 4,000 3,048 OTG Management, LLC 3,789 — BAART Programs, Inc. 3,583 — Pluralsight, LLC 3,532 — Pingora MSR Opportunity Fund I-A, LP 3,500 3,500 MHE Intermediate Holdings, LLC 3,466 — Dialyze Holdings, LLC 3,431 — SIO2 Medical Products, Inc. 3,406 — SumUp Holdings Luxembourg S.À.R.L. 3,350 — Accupac, Inc. 3,267 2,346 CorEvitas, LLC 3,235 5,189 MRI Software LLC 2,699 7,239 Thrasio, LLC 2,578 — PRGX Global, Inc. 2,518 — Berner Food & Beverage, LLC 2,475 — 4 Over International, LLC 2,300 — Relativity ODA LLC 2,218 — Acquia Inc. 2,061 2,240 The Avery 1,850 — Apptio, Inc. 1,338 1,538 Coyote Buyer, LLC 1,333 942 Telestream Holdings Corporation 1,266 — Ministry Brands, LLC 1,100 425 109 Montgomery Owner LLC 937 — Digital.AI Software Holdings, Inc. 898 — Thermacell Repellents, Inc. 833 — GKD Index Partners, LLC 320 231 CircusTrix Holdings, LLC 37 — WPEngine, Inc. — 26,348 NuStar Logistics, L.P. — 17,911 A.T. Holdings II SÀRL — 7,541 New IPT, Inc. — 2,229 iCIMs, Inc. — 882 Immucor, Inc. — 541 Total $ 264,904 $ 157,530 156 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Note 15. Merger with OCSI On March 19, 2021, the Company completed its previously announced acquisition of OCSI. The Company was the accounting survivor of the Mergers. In accordance with the terms of the Merger Agreement, at the effective time of the Merger, each outstanding share of OCSI common stock was converted into the right to receive 1.3371 shares of common stock of the Company (with OCSI stockholders receiving cash in lieu of fractional shares of the Company’s common stock). As a result of the Merger, the Company issued an aggregate of 39,400,011 shares of its common stock to former OCSI stockholders. The Mergers were accounted for as an asset acquisition in accordance with the asset acquisition method of accounting as detailed in ASC 805-50, Business Combinations—Related Issues ("ASC 805"). The Company determined the fair value of the shares of the Company's common stock that were issued to former OCSI stockholders pursuant to the Merger Agreement plus transaction costs to be the consideration paid in connection with the Mergers under ASC 805. The consideration paid to OCSI stockholders was less than the aggregate fair values of the assets acquired and liabilities assumed, which resulted in a purchase discount (the “purchase discount”). The consideration paid was allocated to the individual assets acquired and liabilities assumed based on the relative fair values of net identifiable assets acquired other than “non-qualifying” assets (for example, cash) and did not give rise to goodwill. As a result, the purchase discount was allocated to the cost basis of the OCSI investments acquired by the Company on a pro-rata basis based on their relative fair values as of the effective time of the Mergers. Immediately following the Mergers, the investments were marked to their respective fair values in accordance with ASC 820 which resulted in $34.1 million of unrealized appreciation in the Consolidated Statement of Operations as a result of the Mergers. The purchase discount allocated to the debt investments acquired will accrete over the life of each respective debt investment through interest income, with a corresponding adjustment recorded to unrealized appreciation on such investment acquired through its ultimate disposition. The purchase discount allocated to equity investments acquired will not amortize over the life of such investments through interest income and, assuming no subsequent change to the fair value of the equity investments acquired and disposition of such equity investments at fair value, the Company will recognize a realized gain with a corresponding reversal of the unrealized appreciation on disposition of such equity investments acquired. The Mergers were considered a tax-free reorganization and the Company has elected to carry forward the historical cost basis of the acquired OCSI investments for U.S. federal tax purposes. The following table summarizes the allocation of the consideration paid to the assets acquired and liabilities assumed as a result of the Mergers: Common stock issued by the Company $ 242,704 Transaction costs 1,593 Consideration paid $ 244,297 Investments $ 470,155 Cash and cash equivalents 20,945 Other assets 8,995 Total assets acquired 500,095 Debt 249,098 Other liabilities 6,700 Total liabilities assumed 255,798 Net assets acquired $ 244,297 157 OAKTREE SPECIALTY LENDING CORPORATION NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (in thousands, except share and per share amounts, percentages and as otherwise indicated) Note 16. Subsequent Events The Company’s management evaluated subsequent events through the date of issuance of the Consolidated Financial Statements. There have been no subsequent events that occurred during such period that would require disclosure in, or would be required to be recognized in the Consolidated Financial Statements as of and for the year ended September 30, 2021, except as discussed below. Distribution Declaration On October 13, 2021, the Company’s Board of Directors declared a quarterly distribution of $0.155 per share, payable in cash on December 31, 2021 to stockholders of record on December 15, 2021. 158 Schedule 12-14 Oaktree Specialty Lending Corporation Schedule of Investments in and Advances to Affiliates (in thousands, except share and per share amounts, percentages and as otherwise indicated) Year ended September 30, 2021 Portfolio Company/Type of Investment (1) Cash Interest Rate Industry Principal Net Realized Gain (Loss) Amount of Interest, Fees or Dividends Credited in Income (2) Fair Value as of October 1, 2020 Gross Additions (3) Gross Reductions (4) Fair Value as of June 30, 2021 % of Total Net Assets Control Investments C5 Technology Holdings, LLC Data Processing & Outsourced Services 829 Common Units $ — $ — $ — $ — $ — $ — — % 34,984,460.37 Preferred Units — — 27,638 — — 27,638 2.1 % Dominion Diagnostics, LLC Health Care Services First Lien Term Loan, LIBOR+5.00% cash due 2/28/2024 6.00 % $ 27,381 — 1,726 27,660 — (279) 27,381 2.1 % First Lien Revolver, LIBOR+5.00% cash due 2/28/2024 — — 275 5,260 2,439 (7,699) — — % 30,030.8 Common Units in DD Healthcare Services Holdings, LLC — 2,795 7,667 10,398 — 18,065 1.4 % First Star Speir Aviation Limited (5) Airlines First Lien Term Loan, 9.00% cash due 12/15/2025 7,500 — — 11,510 — (4,010) 7,500 0.6 % 100% equity interest — 763 1,622 1,244 (2,168) 698 0.1 % New IPT, Inc. Oil & Gas Equipment & Services First Lien Term Loan, LIBOR+5.00% cash due 3/17/2021 — — 42 1,800 504 (2,304) — — % First Lien Revolver, LIBOR+5.00% cash due 3/17/2021 — — 17 788 221 (1,009) — — % 50.087 Class A Common Units in New IPT Holdings, LLC — — — — — — — % OCSI Glick JV LLC (6) Multi-Sector Holdings Subordinated Debt, LIBOR+4.50% cash due 10/20/2028 4.60 % 61,709 — 2,401 — 56,693 (1,111) 55,582 4.2 % 87.5% equity interest — — — — — — — % Senior Loan Fund JV I, LLC (7) Multi-Sector Holdings Subordinated Debt, LIBOR+7.00% cash due 12/29/2028 8.00 % 96,250 — 7,388 96,250 — — 96,250 7.3 % 87.5% LLC equity interest — 903 21,190 16,461 — 37,651 2.9 % Total Control Investments $ 192,840 $ — $ 16,310 $ 201,385 $ 87,960 $ (18,580) $ 270,765 20.6 % Affiliate Investments Assembled Brands Capital LLC Specialized Finance First Lien Revolver, LIBOR+6.00% cash due 10/17/2023 7.00 % $ 15,899 $ — $ 736 $ 4,194 $ 12,435 $ (917) $ 15,712 1.2 % 1,609,201 Class A Units — — 483 104 — 587 — % 1,019,168.80 Preferred Units, 6% — — 1,091 61 — 1,152 0.1 % 70,424.5641 Class A Warrants (exercise price $3.3778) expiration date 9/9/2029 — — — — — — — % Caregiver Services, Inc. Health Care Services 1,080,399 shares of Series A Preferred Stock, 10% — — — 741 97 — 838 0.1 % Total Affiliate Investments $ 15,899 $ — $ 736 $ 6,509 $ 12,697 $ (917) $ 18,289 1.4 % Total Control & Affiliate Investments $ 208,739 $ — $ 17,046 $ 207,894 $ 100,657 $ (19,497) $ 289,054 22.0 % 159 This schedule should be read in connection with the Company's Consolidated Financial Statements, including the Consolidated Schedules of Investments and Notes to the Consolidated Financial Statements. ______________________ (1) The principal amount and ownership detail are shown in the Company's Consolidated Schedules of Investments . (2) Represents the total amount of interest (net of non-accrual amounts), fees and dividends credited to income for the portion of the period an investment was included in the Control or Affiliate categories. (3) Gross additions include increases in the cost basis of investments resulting from new portfolio investments, follow-on investments, accrued PIK interest (net of non-accrual amounts) and the exchange of one or more existing securities for one or more new securities. Gross additions also include net increases in unrealized appreciation or net decreases in unrealized depreciation as well as the movement of an existing portfolio company into this category or out of a different category. (4) Gross reductions include decreases in the cost basis of investments resulting from principal payments or sales and exchanges of one or more existing securities for one or more new securities. Gross reductions also include net increases in unrealized depreciation or net decreases in unrealized appreciation as well as the movement of an existing portfolio company out of this category and into a different category. (5) First Star Speir Aviation Limited is a wholly-owned holding company formed by the Company in order to facilitate its investment strategy. In accordance with ASU 2013-08, the Company has deemed the holding company to be an investment company under GAAP and therefore deemed it appropriate to consolidate the financial results and financial position of the holding company and to recognize dividend income versus a combination of interest income and dividend income. Accordingly, the debt and equity investments in the wholly-owned holding company are disregarded for accounting purposes since the economic substance of these instruments are equity investments in the operating entities. (6) Together with GF Equity Funding, the Company co-invests through Glick JV. Glick JV is capitalized as transactions are completed and all portfolio and investment decisions in respect to Glick JV must be approved by the Glick JV investment committee consisting of representatives of the Company and GF Equity Funding (with approval from a representative of each required). (7) Together with Kemper, the Company co-invests through SLF JV I. SLF JV I is capitalized as transactions are completed and all portfolio and investment decisions in respect to SLF JV I must be approved by the SLF JV I investment committee consisting of representatives of the Company and Kemper (with approval from a representative of each required). 160 Schedule 12-14 Oaktree Specialty Lending Corporation Schedule of Investments in and Advances to Affiliates (in thousands, except share and per share amounts, percentages and as otherwise indicated) Year ended September 30, 2020 Portfolio Company/Type of Investment (1) Cash Interest Rate Industry Principal Net Realized Gain (Loss) Amount of Interest, Fees or Dividends Credited in Income (2) Fair Value at October 1, 2019 Gross Additions (3) Gross Reductions (4) Fair Value at September 30, 2020 % of Total Net Assets Control Investments C5 Technology Holdings, LLC Data Processing & Outsourced Services 829 Common Units $ — $ — $ — $ — $ — $ — — % 34,984,460.37 Preferred Units — — 34,984 — (7,346) 27,638 3.0 % Dominion Diagnostics, LLC Health Care Services First Lien Term Loan, LIBOR+5.00% cash due 2/28/2024 6.00 % $ 27,660 — 1,076 — 27,869 (209) 27,660 3.0 % First Lien Revolver, LIBOR+5.00% cash due 2/28/2024 6.00 % 5,260 — 216 — 5,260 — 5,260 0.6 % 30,030.8 Common Units in DD Healthcare Services Holdings, LLC — — — 18,627 (10,960) 7,667 0.8 % First Star Speir Aviation Limited (5) Airlines First Lien Term Loan, 9.00% cash due 12/15/2020 11,510 — 1,180 11,510 106 (106) 11,510 1.3 % 100% equity interest — — 4,630 — (3,008) 1,622 0.2 % New IPT, Inc. Oil & Gas Equipment & Services First Lien Term Loan, LIBOR+5.00% cash due 3/17/2021 6.00 % 2,304 — 193 3,256 — (1,456) 1,800 0.2 % First Lien Revolver, LIBOR+5.00% cash due 3/17/2021 6.00 % 1,009 — 76 1,009 — (221) 788 0.1 % 50.087 Class A Common Units in New IPT Holdings, LLC — — 2,903 — (2,903) — — % Senior Loan Fund JV I, LLC (6) Multi-Sector Holdings Subordinated Debt, LIBOR+7.00% cash due 12/29/2028 7.17 % 96,250 — 8,055 96,250 — — 96,250 10.5 % 87.5% LLC equity interest — — 30,052 — (8,862) 21,190 2.3 % Thruline Marketing, Inc. Advertising First Lien Term Loan, LIBOR+7.00% cash due 4/3/2022 — — 257 18,146 — (18,146) — — % First Lien Revolver, LIBOR+7.75% cash due 4/3/2022 — — 1 — — — — — % 9,073 Class A Units in FS AVI Holdco, LLC (4,932) — 6,438 4,210 (10,648) — — % Total Control Investments $ 143,993 $ (4,932) $ 11,054 $ 209,178 $ 56,072 $ (63,865) $ 201,385 22.0 % Affiliate Investments Assembled Brands Capital LLC Specialized Finance First Lien Revolver, LIBOR+6.00% cash due 10/17/2023 7.00 % $ 4,688 $ — $ 487 $ 5,585 $ 2,036 $ (3,427) $ 4,194 0.5 % 1,609,201 Class A Units — — 782 — (299) 483 0.1 % 1,019,168.80 Preferred Units, 6% — — 1,019 72 — 1,091 0.1 % 70,424.5641 Class A Warrants (exercise price $3.3778) expiration date 9/9/2029 — — — — — — — % Caregiver Services, Inc. Health Care Services 1,080,399 shares of Series A Preferred Stock, 10% — — — 1,784 — (1,043) 741 0.1 % Total Affiliate Investments $ 4,688 $ — $ 487 $ 9,170 $ 2,108 $ (4,769) $ 6,509 0.7 % Total Control & Affiliate Investments $ 148,681 $ (4,932) $ 11,541 $ 218,348 $ 58,180 $ (68,634) $ 207,894 22.7 % 161 This schedule should be read in connection with the Company's Consolidated Financial Statements, including the Consolidated Schedules of Investments and Notes to the Consolidated Financial Statements. ______________________ (1) The principal amount and ownership detail are shown in the Company's Consolidated Schedules of Investments. (2) Represents the total amount of interest (net of non-accrual amounts), fees and dividends credited to income for the portion of the period an investment was included in the Control or Affiliate categories. (3) Gross additions include increases in the cost basis of investments resulting from new portfolio investments, follow-on investments, accrued PIK interest (net of non-accrual amounts) and the exchange of one or more existing securities for one or more new securities. Gross additions also include net increases in unrealized appreciation or net decreases in unrealized depreciation as well as the movement of an existing portfolio company into this category or out of a different category. (4) Gross reductions include decreases in the cost basis of investments resulting from principal payments or sales and exchanges of one or more existing securities for one or more new securities. Gross reductions also include net increases in unrealized depreciation or net decreases in unrealized appreciation as well as the movement of an existing portfolio company out of this category and into a different category. (5) First Star Speir Aviation Limited is a wholly-owned holding company formed by the Company in order to facilitate its investment strategy. In accordance with ASU 2013-08, the Company has deemed the holding company to be an investment company under GAAP and therefore deemed it appropriate to consolidate the financial results and financial position of the holding company and to recognize dividend income versus a combination of interest income and dividend income. Accordingly, the debt and equity investments in the wholly-owned holding company are disregarded for accounting purposes since the economic substance of these instruments are equity investments in the operating entities. (6) Together with Kemper, the Company co-invests through SLF JV I. SLF JV I is capitalized as transactions are completed and all portfolio and investment decisions in respect to SLF JV I must be approved by the SLF JV I investment committee consisting of representatives of the Company and Kemper (with approval from a representative of each required). 162 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure Not applicable.