##### Table of Contents





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q







|x | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ---------------------------------------------------------------------------------------

For the Quarter Ended March 31, 2015



| ̈ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
|- | ----------------------------------------------------------------------------------------

Commission File Number: 814-00849





SOLAR SENIOR
CAPITAL LTD.

(Exact name of registrant as specified in its charter)







|                                         |  |                                     
|---------------------------------------- |  | ------------------------------------
|Maryland                                 |  | 27-4288022                          
|(State of Incorporation)                 |  | (I.R.S. Employer Identification No.)
|500 Park Avenue New York, N.Y.           |  | 10022                               
|(Address of principal executive offices) |  | (Zip Code)                          

(212) 993-1670

(Registrants telephone number, including area code)





Indicate by
check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the
past 90 days.    Yes  x    No   ̈

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every
Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post
such files).    Yes   ̈    No   ̈

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See
definition of accelerated filer and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):



|                        |  |   |  |                           |  |  
|----------------------- |  | - |  | ------------------------- |  | -
|Large accelerated filer |  |  ̈ |  | Accelerated filer         |  | x
|                        |  |   | 
|Non-accelerated filer   |  |  ̈ |  | Smaller Reporting Company |  |  ̈

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

The number of shares of the registrants Common Stock, $.01 par value, outstanding as of May 4, 2015 was 11,533,315.









---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2015

TABLE OF CONTENTS





|                              |  |                                                                                                                                              |  |  |    | 
|----------------------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------- |  |  | -- | 
|                              |  | PAGE                                                                                                                                         | 
|PART I. FINANCIAL INFORMATION |  |                                                                                                                                              | 
|                              |  |                                                                                                                                             
|Item 1.                       |  | Financial Statements                                                                                                                         |  |  |    | 
|                              |  | Consolidated Statements of Assets and Liabilities as of March 31, 2015 (unaudited) and December 31, 2014                                     |  |  | 3  | 
|                              |  |                                                                                                                                             
|                              |  | Consolidated Statements of Operations for the three months ended March 31, 2015 (unaudited) and March 31, 2014
 (unaudited)                  |  |  | 4  | 
|                              |  |                                                                                                                                             
|                              |  | Consolidated Statements of Changes in Net Assets for the three months ended March 31, 2015 (unaudited) and
 the year ended December 31, 2014 |  |  | 5  | 
|                              |  |                                                                                                                                             
|                              |  | Consolidated Statements of Cash Flows for the three months ended March 31, 2015 (unaudited) and March 31, 2014
 (unaudited)                  |  |  | 6  | 
|                              |  |                                                                                                                                             
|                              |  | Consolidated Schedule of Investments as of March 31, 2015 (unaudited)                                                                        |  |  | 7  | 
|                              |  |                                                                                                                                             
|                              |  | Consolidated Schedule of Investments as of December 31, 2014                                                                                 |  |  | 10 | 
|                              |  |                                                                                                                                             
|                              |  | Notes to Consolidated Financial Statements (unaudited)                                                                                       |  |  | 13 | 
|                              |  |                                                                                                                                             
|                              |  | Report of Independent Registered Public Accounting Firm                                                                                      |  |  | 30 | 
|                              |  |                                                                                                                                             
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition and Results of Operations                                                        |  |  | 31 | 
|                              |  |                                                                                                                                             
|Item 3.                       |  | Quantitative and Qualitative Disclosures About Market Risk                                                                                   |  |  | 47 | 
|                              |  |                                                                                                                                             
|Item 4.                       |  | Controls and Procedures                                                                                                                      |  |  | 47 | 
|                              | 
|PART II. OTHER INFORMATION    |  |                                                                                                                                              |  | 
|                              |  |                                                                                                                                             
|Item 1.                       |  | Legal Proceedings                                                                                                                            |  |  | 48 | 
|                              |  |                                                                                                                                             
|Item 1A.                      |  | Risk Factors                                                                                                                                 |  |  | 48 | 
|                              |  |                                                                                                                                             
|Item 2.                       |  | Unregistered Sales of Equity Securities and Use of Proceeds                                                                                  |  |  | 48 | 
|                              |  |                                                                                                                                             
|Item 3.                       |  | Defaults Upon Senior Securities                                                                                                              |  |  | 48 | 
|                              |  |                                                                                                                                             
|Item 4.                       |  | Mine Safety Disclosures                                                                                                                      |  |  | 48 | 
|                              |  |                                                                                                                                             
|Item 5.                       |  | Other Information                                                                                                                            |  |  | 48 | 
|                              |  |                                                                                                                                             
|Item 6.                       |  | Exhibits                                                                                                                                     |  |  | 49 | 
|                              |  |                                                                                                                                             
|                              |  | Signatures                                                                                                                                   |  |  | 51 | 



2



---

##### Table of Contents

PART I. FINANCIAL INFORMATION

In this Quarterly Report, Solar Senior, Company, Fund, we, us, and our refer to
Solar Senior Capital Ltd. unless the context states otherwise.



|Item 1. | Financial Statements
|------- | --------------------

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

(in thousands, except share amounts)



|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------ | ------- | - | ---------------- | - | ------- | -
|                                                                                                                                                                                |  | March 31,2015(unaudited) |         |   | December 31,2014 |  
|Assets                                                                                                                                                                          |  |                          |         |   |                  |   |         |  
|Investments at fair value:                                                                                                                                                      |  |                          |         |   |                  |   |         |  
|Companies less than 5% owned (cost: $277,445 and $302,343, respectively)                                                                                                        |  | $                        | 278,209 |   |                  | $ | 302,422 |  
|Companies 5% to 25% owned (cost: $4,034 and $4,034, respectively)                                                                                                               |  |                          | 3,487   |   |                  |   | 3,623   |  
|Companies more than 25% owned (cost: $62,423 and $32,839, respectively)                                                                                                         |  |                          | 63,657  |   |                  |   | 34,421  |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|Total investments (cost: $343,902 and $339,216, respectively)                                                                                                                   |  |                          | 345,353 |   |                  |   | 340,466 |  
|Cash                                                                                                                                                                            |  |                          | 4,840   |   |                  |   | 7,471   |  
|Cash equivalents                                                                                                                                                                |  |                          | 35,003  |   |                  |   | 35,000  |  
|Interest receivable                                                                                                                                                             |  |                          | 779     |   |                  |   | 1,029   |  
|Dividends receivable                                                                                                                                                            |  |                          | 591     |   |                  |   | 442     |  
|Receivable for investments sold                                                                                                                                                 |  |                          | 90      |   |                  |   |        |  
|Prepaid expenses and other assets                                                                                                                                               |  |                          | 520     |   |                  |   | 389     |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|Total assets                                                                                                                                                                    |  | $                        | 387,176 |   |                  | $ | 384,797 |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|Liabilities                                                                                                                                                                     |  |                          |         |   |                  |   |         |  
|Credit facility payable (see note 6 and 7)                                                                                                                                      |  | $                        | 140,900 |   |                  | $ | 143,200 |  
|Payable for investments and cash equivalents purchased                                                                                                                          |  |                          | 39,978  |   |                  |   | 35,000  |  
|Distributions payable                                                                                                                                                           |  |                          | 1,355   |   |                  |   | 1,355   |  
|Management fee payable (see note 3)                                                                                                                                             |  |                          | 866     |   |                  |   | 798     |  
|Interest payable                                                                                                                                                                |  |                          | 291     |   |                  |   | 277     |  
|Administrative services expense payable (see note 3)                                                                                                                            |  |                          | 34      |   |                  |   | 444     |  
|Other liabilities and accrued expenses                                                                                                                                          |  |                          | 213     |   |                  |   | 204     |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|Total liabilities                                                                                                                                                               |  | $                        | 183,637 |   |                  | $ | 181,278 |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|Commitments and contingencies (see note 10 and 11)                                                                                                                              |  |                          |         |   |                  |   |         |  
|Net Assets                                                                                                                                                                      |  |                          |         |   |                  |   |         |  
|Common stock, par value $0.01 per share, 200,000,000 and 200,000,000 common shares authorized, respectively, and 11,533,315 and
11,533,315 issued and outstanding, respectively |  | $                        | 115     |   |                  | $ | 115     |  
|Paid-in capital in excess of par                                                                                                                                                |  |                          | 211,449 |   |                  |   | 211,449 |  
|Distributions in excess of net investment income                                                                                                                                |  |                          | (3,719  | ) |                  |   | (3,529  | )
|Accumulated net realized loss                                                                                                                                                   |  |                          | (5,757  | ) |                  |   | (5,766  | )
|Net unrealized appreciation                                                                                                                                                     |  |                          | 1,451   |   |                  |   | 1,250   |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|Total net assets                                                                                                                                                                |  | $                        | 203,539 |   |                  | $ | 203,519 |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  
|Net Asset Value Per Share                                                                                                                                                       |  | $                        | 17.65   |   |                  | $ | 17.65   |  
|                                                                                                                                                                                |  |                          |         |   |                  |   |         |  

See notes to consolidated financial statements.



3



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

(in thousands, except share amounts)



|                                                                                           |  |                    |       |   |               |   |       |  
|------------------------------------------------------------------------------------------ |  | ------------------ | ----- | - | ------------- | - | ----- | -
|                                                                                           |  | Three months ended |      
|                                                                                           |  | March 31,2015      |       |   | March 31,2014 |  
|INVESTMENT INCOME:                                                                         |  |                    |       |   |               |   |       |  
|Interest:                                                                                  |  |                    |       |   |               |   |       |  
|Companies less than 5% owned                                                               |  | $                  | 5,119 |   |               | $ | 4,862 |  
|Companies 5% to 25% owned                                                                  |  |                    | 53    |   |               |   | 57    |  
|Dividends:                                                                                 |  |                    |       |   |               |   |       |  
|Companies more than 25% owned                                                              |  |                    | 969   |   |               |   | 817   |  
|Other income:                                                                              |  |                    |       |   |               |   |       |  
|Companies more than 25% owned                                                              |  |                    | 2     |   |               |   |      |  
|                                                                                           |  |                    |       |   |               |   |       |  
|Total investment income                                                                    |  |                    | 6,143 |   |               |   | 5,736 |  
|                                                                                           |  |                    |       |   |               |   |       |  
|EXPENSES:                                                                                  |  |                    |       |   |               |   |       |  
|Management fees (see note 3)                                                               |  | $                  | 866   |   |               | $ | 687   |  
|Performance-based incentive fees (see note 3)                                              |  |                    | 157   |   |               |   | 213   |  
|Interest and other credit facility expenses (see note 7)                                   |  |                    | 832   |   |               |   | 437   |  
|Administrative services expense (see note 3)                                               |  |                    | 254   |   |               |   | 242   |  
|Other general and administrative expenses                                                  |  |                    | 315   |   |               |   | 304   |  
|                                                                                           |  |                    |       |   |               |   |       |  
|Total expenses                                                                             |  |                    | 2,424 |   |               |   | 1,883 |  
|                                                                                           |  |                    |       |   |               |   |       |  
|Performance-based incentive fees waived (see note 3)                                       |  |                    | (157  | ) |               |   |      |  
|                                                                                           |  |                    |       |   |               |   |       |  
|Net expenses                                                                               |  |                    | 2,267 |   |               |   | 1,883 |  
|                                                                                           |  |                    |       |   |               |   |       |  
|Net investment income                                                                      |  | $                  | 3,876 |   |               | $ | 3,853 |  
|                                                                                           |  |                    |       |   |               |   |       |  
|                                                                                           |  |                   
|REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS AND CASH EQUIVALENTS:                   |  |                    |       |   |               |   |       |  
|Net realized gain (loss) on investments and cash equivalents (companiesless than 5% owned) |  | $                  | 9     |   |               | $ | (812  | )
|Net change in unrealized gain on investments and cash equivalents                          |  |                    | 201   |   |               |   | 947   |  
|                                                                                           |  |                    |       |   |               |   |       |  
|Net realized and unrealized gain (loss) on investments and cash equivalents                |  |                    | 210   |   |               |   | 135   |  
|                                                                                           |  |                    |       |   |               |   |       |  
|NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS                                       |  | $                  | 4,086 |   |               | $ | 3,988 |  
|                                                                                           |  |                    |       |   |               |   |       |  
|EARNINGS PER SHARE (see note 5)                                                            |  | $                  | 0.35  |   |               | $ | 0.35  |  
|                                                                                           |  |                    |       |   |               |   |       |  

See notes to consolidated financial statements.



4



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

(in thousands, except share amounts)



|                                                               |  |                                             |         |   |                             |   |         |   
|-------------------------------------------------------------- |  | ------------------------------------------- | ------- | - | --------------------------- | - | ------- | --
|                                                               |  | Three months endedMarch 31, 2015(unaudited) |         |   | Year endedDecember 31, 2014 |  
|Increase in net assets resulting from operations:              |  |                                             |         |   |                             |   |         |   
|Net investment income                                          |  | $                                           | 3,876   |   |                             | $ | 13,814  |   
|Net realized gain (loss)                                       |  |                                             | 9       |   |                             |   | (638    | ) 
|Net change in unrealized gain (loss)                           |  |                                             | 201     |   |                             |   | (1,486  | ) 
|                                                               |  |                                             |         |   |                             |   |         |   
|Net increase in net assets resulting from operations           |  |                                             | 4,086   |   |                             |   | 11,690  |   
|                                                               |  |                                             |         |   |                             |   |         |   
|Distributions to stockholders:                                 |  |                                             |         |   |                             |   |         |   
|From net investment income                                     |  |                                             | (4,066  | ) |                             |   | (14,842 | ) 
|From other sources                                             |  |                                             |        |   |                             |   | (1,419  | )
|                                                               |  |                                             |         |   |                             |   |         |   
|Net distributions to stockholders                              |  |                                             | (4,066  | ) |                             |   | (16,261 | ) 
|                                                               |  |                                             |         |   |                             |   |         |   
|Capital transactions:                                          |  |                                             |         |   |                             |   |         |   
|Reinvestment of distributions                                  |  |                                             |        |   |                             |   | 73      |   
|                                                               |  |                                             |         |   |                             |   |         |   
|Net increase in net assets resulting from capital transactions |  |                                             |        |   |                             |   | 73      |   
|                                                               |  |                                             |         |   |                             |   |         |   
|Total increase (decrease) in net assets                        |  |                                             | 20      |   |                             |   | (4,498  | ) 
|Net assets at beginning of period                              |  |                                             | 203,519 |   |                             |   | 208,017 |   
|                                                               |  |                                             |         |   |                             |   |         |   
|Net assets at end of period(1)                                 |  | $                                           | 203,539 |   |                             | $ | 203,519 |   
|                                                               |  |                                             |         |   |                             |   |         |   
|Capital share activity:                                        |  |                                             |         |   |                             |   |         |   
|Common stock issued from reinvestment of distributions         |  |                                             |        |   |                             |   | 4,012   |   
|                                                               |  |                                             |         |   |                             |   |         |   
|Net increase from capital share activity                       |  |                                             |        |   |                             |   | 4,012   |   
|                                                               |  |                                             |         |   |                             |   |         |   



| | Represents tax return of capital.
|- | ---------------------------------

|(1) | Includes undistributed (overdistributed) net investment income of ($3,719) and ($3,529), respectively.
|--- | ------------------------------------------------------------------------------------------------------

See notes to consolidated financial statements.



5



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)

(in thousands)



|                                                                               |  |                    |         |   |               |   |         |  
|------------------------------------------------------------------------------ |  | ------------------ | ------- | - | ------------- | - | ------- | -
|                                                                               |  | Three months ended |        
|                                                                               |  | March 31,2015      |         |   | March 31,2014 |  
|Cash Flows from Operating Activities:                                          |  |                    |         |   |               |   |         |  
|Net increase in net assets resulting from operations                           |  | $                  | 4,086   |   |               | $ | 3,988   |  
|Adjustments to reconcile net increase in net assets resulting from operations: |  |                    |         |   |               |   |         |  
|Net realized (gain) loss on investments and cash equivalents                   |  |                    | (9      | ) |               |   | 812     |  
|Net change in unrealized (gain) loss on investments and cash equivalents       |  |                    | (201    | ) |               |   | (947    | )
|(Increase) decrease in operating assets:                                       |  |                    |         |   |               |   |         |  
|Purchase of investments                                                        |  |                    | (24,720 | ) |               |   | (49,873 | )
|Proceeds from disposition of investments                                       |  |                    | 20,073  |   |               |   | 43,009  |  
|Capitalization of payment-in-kind interest                                     |  |                    | (30     | ) |               |   | (23     | )
|Receivable for investments sold                                                |  |                    | (90     | ) |               |   | (88     | )
|Interest receivable                                                            |  |                    | 250     |   |               |   | (32     | )
|Dividends receivable                                                           |  |                    | (149    | ) |               |   | (40     | )
|Prepaid expenses and other assets                                              |  |                    | (131    | ) |               |   | (193    | )
|Increase (decrease) in operating liabilities:                                  |  |                    |         |   |               |   |         |  
|Payable for investments and cash equivalents purchased                         |  |                    | 4,978   |   |               |   | 17,234  |  
|Management fee payable                                                         |  |                    | 68      |   |               |   | (16     | )
|Performance-based incentive fees payable                                       |  |                    |        |   |               |   | 180     |  
|Administrative services expense payable                                        |  |                    | (410    | ) |               |   | (326    | )
|Interest payable                                                               |  |                    | 14      |   |               |   | 38      |  
|Other liabilities and accrued expenses                                         |  |                    | 9       |   |               |   | 96      |  
|                                                                               |  |                    |         |   |               |   |         |  
|Net Cash Provided by (Used in) Operating Activities                            |  |                    | 3,738   |   |               |   | 13,819  |  
|                                                                               |  |                    |         |   |               |   |         |  
|Cash Flows from Financing Activities:                                          |  |                    |         |   |               |   |         |  
|Cash distributions paid                                                        |  |                    | (4,066  | ) |               |   | (4,051  | )
|Proceeds from borrowings                                                       |  |                    | 12,100  |   |               |   | 34,300  |  
|Repayments of borrowings                                                       |  |                    | (14,400 | ) |               |   | (39,100 | )
|                                                                               |  |                    |         |   |               |   |         |  
|Net Cash Provided by (Used in) Financing Activities                            |  |                    | (6,366  | ) |               |   | (8,851  | )
|                                                                               |  |                    |         |   |               |   |         |  
|NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                           |  |                    | (2,628  | ) |               |   | 4,968   |  
|CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                               |  |                    | 42,471  |   |               |   | 2,774   |  
|                                                                               |  |                    |         |   |               |   |         |  
|CASH AND CASH EQUIVALENTS AT END OF PERIOD                                     |  | $                  | 39,843  |   |               | $ | 7,742   |  
|                                                                               |  |                    |         |   |               |   |         |  
|Supplemental disclosure of cash flow information:                              |  |                    |         |   |               |   |         |  
|Cash paid for interest                                                         |  | $                  | 818     |   |               | $ | 399     |  
|                                                                               |  |                    |         |   |               |   |         |  

Non-cash financing activities consist of the reinvestment of distributions of $0 and $73 for the three months ended
March 31, 2015 and 2014, respectively. Additionally, during the three months ended March 31, 2015, $29,584 of investments were transferred from the Company to First Lien Loan Program LLC (see note 11).

See notes to consolidated financial statements.



6



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS (unaudited)

March 31, 2015

(in thousands, except share/unit amounts)



|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|---------------------------------------------------------- |  | ------------------------------------ | - | ------------------- | ----- |  | ---------- | -------- | ---- | --------------- |  |  | --------------- | ---- |  | ------------ | ---------- |  | --------- |  | ---------- | ---- |  | - | ------------ |  |  | - | ------ |  |  | - | ------ | 
|Description                                                |  | Industry                             |   | SpreadaboveIndex(3) |       |  | LiborFloor |          |      | InterestRate(1) |  |  | AcquisitionDate |      |  | MaturityDate |            |  | ParAmount |  |            | Cost |  |   | FairValue    | 
|Bank Debt/Senior Secured Loans  136.2%                    |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Advantage Sales and Marketing, Inc                         |  | Professional Services                |   |                     | L+650 |  |            |          | 1.00 | %               |  |  | 7.50            | %    |  |              | 2/14/2013  |  |           |  | 7/21/2022  |      |  | $ | 8,000        |  |  | $ | 7,944  |  |  | $ | 8,028  | 
|Aegis Toxicology Sciences Corporation                      |  | Health Care Services                 |   |                     | L+850 |  |            |          | 1.00 | %               |  |  | 9.50            | %    |  |              | 2/20/2014  |  |           |  | 8/24/2021  |      |  |   | 4,000        |  |  |   | 3,946  |  |  |   | 3,940  | 
|ALG B.V. (Apple Leisure)(2)(4)                             |  | Hotels, Restaurants & Leisure        |   |                     | L+575 |  |            |          | 1.25 | %               |  |  | 7.00            | %    |  |              | 2/28/2013  |  |           |  | 2/28/2019  |      |  |   | 2,776        |  |  |   | 2,756  |  |  |   | 2,776  | 
|ALG USA Holdings, LLC (Apple
Leisure)(2)                   |  | Hotels, Restaurants & Leisure        |   |                     | L+575 |  |            |          | 1.25 | %               |  |  | 7.00            | %    |  |              | 2/28/2013  |  |           |  | 2/28/2019  |      |  |   | 3,679        |  |  |   | 3,654  |  |  |   | 3,679  | 
|AmeriQual Group, LLC(2)                                    |  | Food Products                        |   |                     | L+500 |  |            |          | 1.50 | %               |  |  | 7.25            | %(5) |  |              | 3/28/2011  |  |           |  | 3/28/2016  |      |  |   | 11,189       |  |  |   | 11,151 |  |  |   | 10,965 | 
|Aperture Group, LLC (Trade Monster)(2)                     |  | Capital Markets                      |   |                     | L+625 |  |            |          | 1.00 | %               |  |  | 7.25            | %    |  |              | 9/2/2014   |  |           |  | 8/29/2019  |      |  |   | 3,980        |  |  |   | 3,962  |  |  |   | 3,980  | 
|Asurion, LLC                                               |  | Insurance                            |   |                     | L+750 |  |            |          | 1.00 | %               |  |  | 8.50            | %    |  |              | 2/27/2014  |  |           |  | 3/3/2021   |      |  |   | 2,500        |  |  |   | 2,467  |  |  |   | 2,516  | 
|Athletico Management, LLC and Accelerated Holdings,
LLC(2) |  | Health Care Facilities               |   |                     | L+550 |  |            |          | 0.75 | %               |  |  | 6.25            | %    |  |              | 12/1/2014  |  |           |  | 12/2/2020  |      |  |   | 9,975        |  |  |   | 9,880  |  |  |   | 9,975  | 
|Blue Coat Systems, Inc                                     |  | Internet Software & Services         |   |                     | L+850 |  |            |          | 1.00 | %               |  |  | 9.50            | %    |  |              | 6/28/2013  |  |           |  | 6/28/2020  |      |  |   | 4,500        |  |  |   | 4,463  |  |  |   | 4,590  | 
|Blue Ribbon, LLC (Pabst)(2)                                |  | Beverages                            |   |                     | L+475 |  |            |          | 1.00 | %               |  |  | 5.75            | %    |  |              | 11/5/2014  |  |           |  | 11/13/2021 |      |  |   | 1,477        |  |  |   | 1,463  |  |  |   | 1,490  | 
|Capstone Logistics Acqusition, Inc.(2)                     |  | Professional Services                |   |                     | L+450 |  |            |          | 1.00 | %               |  |  | 5.50            | %    |  |              | 10/3/2014  |  |           |  | 10/7/2021  |      |  |   | 8,479        |  |  |   | 8,398  |  |  |   | 8,394  | 
|Castle Management Borrower LLC (Highgate
Hotels)(2)        |  | Real Estate Management & Development |   |                     | L+450 |  |            |          | 1.00 | %               |  |  | 5.50            | %    |  |              | 10/10/2014 |  |           |  | 9/18/2020  |      |  |   | 7,960        |  |  |   | 7,886  |  |  |   | 7,960  | 
|CGSC of Delaware Holdings Corp. (Cooper Gay)               |  | Insurance                            |   |                     | L+700 |  |            |          | 1.25 | %               |  |  | 8.25            | %    |  |              | 4/5/2013   |  |           |  | 10/16/2020 |      |  |   | 4,000        |  |  |   | 3,956  |  |  |   | 3,640  | 
|Confie Seguros Holding II Co.(2)                           |  | Insurance                            |   |                     | L+450 |  |            |          | 1.25 | %               |  |  | 5.75            | %    |  |              | 11/9/2012  |  |           |  | 11/9/2018  |      |  |   | 13,130       |  |  |   | 13,022 |  |  |   | 13,130 | 
|ConvergeOne Holdings Corp.(2)                              |  | Communications Equipment             |   |                     | L+500 |  |            |          | 1.00 | %               |  |  | 6.00            | %    |  |              | 6/16/2014  |  |           |  | 6/17/2020  |      |  |   | 6,948        |  |  |   | 6,886  |  |  |   | 6,947  | 
|CT Technologies Intermediate
Holdings(2)                   |  | Health Care Technology               |   |                     | L+500 |  |            |          | 1.00 | %               |  |  | 6.00            | %    |  |              | 12/1/2014  |  |           |  | 12/1/2021  |      |  |   | 4,988        |  |  |   | 4,939  |  |  |   | 4,988  | 
|Engineering Solutions & Products,
LLC(7)                   |  | Aerospace & Defense                  |   |                     | L+600 |  |            |          | 2.00 | %               |  |  | 8.00            | %    |  |              | 11/5/2013  |  |           |  | 5/4/2018   |      |  |   | 324          |  |  |   | 324    |  |  |   | 324    | 
|Engineering Solutions & Products, LLC(7)                   |  | Aerospace & Defense                  |   |                     | L+600 |  |            |          | 2.00 | %               |  |  | 8.00            | %    |  |              | 11/5/2013  |  |           |  | 11/5/2018  |      |  |   | 2,343        |  |  |   | 2,343  |  |  |   | 2,343  | 
|Epic Health Services, Inc.(2)                              |  | Health Care Services                 |   |                     | L+475 |  |            |          | 1.00 | %               |  |  | 5.75            | %    |  |              | 2/20/2015  |  |           |  | 2/17/2021  |      |  |   | 3,000        |  |  |   | 2,970  |  |  |   | 2,970  | 
|Filtration Group Corp.                                     |  | Industrial Conglomerates             |   |                     | L+725 |  |            |          | 1.00 | %               |  |  | 8.25            | %    |  |              | 11/15/2013 |  |           |  | 11/21/2021 |      |  |   | 2,000        |  |  |   | 1,982  |  |  |   | 2,012  | 
|Fulton Holding Corp.(2)                                    |  | Specialty Retail                     |   |                     |      |  |            |          |     |                 |  |  | 8.50            | %    |  |              | 5/10/2013  |  |           |  | 5/28/2018  |      |  |   | 15,000       |  |  |   | 15,076 |  |  |   | 15,150 | 
|Global Tel*Link Corp                                       |  | Communications Equipment             |   |                     | L+775 |  |            |          | 1.25 | %               |  |  | 9.00            | %    |  |              | 5/21/2013  |  |           |  | 11/23/2020 |      |  |   | 3,000        |  |  |   | 2,951  |  |  |   | 2,945  | 
|HC Group Holdings III, Inc. (Walgreens)                    |  | Health Care Services                 |   |                     | L+500 |  |            |          | 1.00 | %               |  |  | 6.00            | %    |  |              | 3/25/2015  |  |           |  | 4/7/2022   |      |  |   | 5,000        |  |  |   | 4,975  |  |  |   | 4,975  | 
|Hostway Corporation(2)                                     |  | Internet Software & Services         |   |                     | L+475 |  |            |          | 1.25 | %               |  |  | 6.00            | %    |  |              | 6/27/2014  |  |           |  | 12/13/2019 |      |  |   | 9,688        |  |  |   | 9,648  |  |  |   | 9,688  | 
|Ikaria, Inc                                                |  | Health Care Technology               |   |                     | L+775 |  |            |          | 1.00 | %               |  |  | 8.75            | %    |  |              | 2/4/2014   |  |           |  | 2/12/2022  |      |  |   | 4,000        |  |  |   | 3,973  |  |  |   | 4,040  | 
|Innovative Xcessories & Services,
LLC(2)                   |  | Automotive Retail                    |   |                     | L+425 |  |            |          | 1.00 | %               |  |  | 5.25            | %    |  |              | 8/21/2014  |  |           |  | 2/21/2020  |      |  |   | 4,625        |  |  |   | 4,584  |  |  |   | 4,625  | 
|IPC Systems, Inc.(2)                                       |  | Communications Equipment             |   |                     | L+550 |  |            |          | 1.00 | %               |  |  | 6.50            | %    |  |              | 2/03/2015  |  |           |  | 8/6/2021   |      |  |   | 5,000        |  |  |   | 4,852  |  |  |   | 5,041  | 
|Kellermeyer Bergensons Services, LLC 
(KBS)(2)             |  | Commercial Services & Supplies       |   |                     | L+500 |  |            |          | 1.00 | %               |  |  | 6.00            | %    |  |              | 10/31/2014 |  |           |  | 10/29/2021 |      |  |   | 4,988        |  |  |   | 4,940  |  |  |   | 4,987  | 
|KODA Distribution Group, Inc.(2)                           |  | Distributors                         |   |                     | L+500 |  |            |          | 1.00 | %               |  |  | 6.00            | %    |  |              | 9/30/2013  |  |           |  | 4/9/2018   |      |  |   | 9,650        |  |  |   | 9,624  |  |  |   | 9,554  | 
|Landslide Holdings, Inc                                    |  | Software                             |   |                     | L+725 |  |            |          | 1.00 | %               |  |  | 8.25            | %    |  |              | 2/25/2014  |  |           |  | 2/25/2021  |      |  |   | 3,310        |  |  |   | 3,306  |  |  |   | 3,310  | 
|Material Handling Services, LLC
(TFS)(2)                   |  | Air Freight & Logistics              |   |                     | L+475 |  |            |          | 1.00 | %               |  |  | 5.75            | %    |  |              | 3/3/2014   |  |           |  | 3/26/2020  |      |  |   | 11,685       |  |  |   | 11,583 |  |  |   | 11,568 | 
|Metamorph US 3, LLC (Metalogix)(2)                         |  | Software                             |   |                     | L+550 |  |            |          | 1.00 | %               |  |  | 6.50            | %    |  |              | 12/1/2014  |  |           |  | 12/1/2020  |      |  |   | 9,938        |  |  |   | 9,700  |  |  |   | 9,739  | 
|Miller Heiman, Inc.(2)                                     |  | Professional Services                |   |                     | L+575 |  |            |          | 1.00 | %               |  |  | 6.75            | %    |  |              | 9/30/2013  |  |           |  | 9/30/2019  |      |  |   | 7,272        |  |  |   | 7,211  |  |  |   | 7,126  | 
|MYI Acquiror Corp. (McLarens Young)(2)                     |  | Insurance                            |   |                     | L+450 |  |            |          | 1.25 | %               |  |  | 5.75            | %    |  |              | 5/21/2014  |  |           |  | 5/28/2019  |      |  |   | 3,483        |  |  |   | 3,453  |  |  |   | 3,413  | 
|MYI Acquiror Ltd. (McLarens
Young)(2)(4)                   |  | Insurance                            |   |                     | L+450 |  |            |          | 1.25 | %               |  |  | 5.75            | %    |  |              | 5/21/2014  |  |           |  | 5/28/2019  |      |  |   | 4,478        |  |  |   | 4,439  |  |  |   | 4,388  | 
|Pearl Merger Sub LLC (PetVet)(2)                           |  | Health Care Facilities               |   |                     | L+450 |  |            |          | 1.00 | %               |  |  | 5.50            | %    |  |              | 1/29/2015  |  |           |  | 12/17/2020 |      |  |   | 4,489        |  |  |   | 4,401  |  |  |   | 4,399  | 
|PM Holdings III Corp.(Pro Mach)(2)                         |  | Machinery                            |   |                     | L+450 |  |            |          | 1.00 | %               |  |  | 5.50            | %    |  |              | 10/17/2014 |  |           |  | 10/22/2021 |      |  |   | 8,978        |  |  |   | 8,892  |  |  |   | 8,978  | 
|QBS Holding Company, Inc. (Quorum).(2)                     |  | Software                             |   |                     | L+475 |  |            |          | 1.00 | %               |  |  | 5.75            | %    |  |              | 8/1/2014   |  |           |  | 8/7/2021   |      |  |   | 6,484        |  |  |   | 6,424  |  |  |   | 6,354  | 
|QoL Meds, LLC(2)                                           |  | Health Care Services                 |   |                     | L+450 |  |            |          | 1.00 | %               |  |  | 5.50            | %    |  |              | 7/14/2014  |  |           |  | 7/15/2020  |      |  |   | 7,960        |  |  |   | 7,924  |  |  |   | 7,960  | 
|Richelieu Foods, Inc.(2)                                   |  | Food Products                        |   |                     | L+475 |  |            |          | 1.00 | %               |  |  | 5.75            | %    |  |              | 11/21/2014 |  |           |  | 5/21/2020  |      |  |   | 6,948        |  |  |   | 6,849  |  |  |   | 6,843  | 
|Securus Technologies, Inc                                  |  | Communications Equipment             |   |                     | L+775 |  |            |          | 1.25 | %               |  |  | 9.00            | %    |  |              | 4/17/2013  |  |           |  | 4/30/2021  |      |  |   | 10,000       |  |  |   | 9,924  |  |  |   | 9,880  | 
|Shoes for Crews, Inc.(2)                                   |  | Footwear                             |   |                     | L+425 |  |            |          | 1.25 | %               |  |  | 5.50            | %    |  |              | 3/27/2012  |  |           |  | 3/27/2017  |      |  |   | 3,267        |  |  |   | 3,265  |  |  |   | 3,267  | 
|Skinnypop Popcorn, LLC(2)                                  |  | Food Products                        |   |                     | L+450 |  |            |          | 1.00 | %               |  |  | 5.50            | %    |  |              | 7/17/2014  |  |           |  | 7/17/2019  |      |  |   | 4,938        |  |  |   | 4,894  |  |  |   | 4,938  | 
|Trident USA Health Services(2)                             |  | Health Care Services                 |   |                     | L+525 |  |            |          | 1.25 | %               |  |  | 6.50            | %    |  |              | 7/29/2013  |  |           |  | 7/31/2019  |      |  |   | 8,968        |  |  |   | 8,903  |  |  |   | 8,743  | 
|Varsity Brands Holdings Co., Inc.(2)                       |  | Diversified Consumer Services        |   |                     | L+500 |  |            |          | 1.00 | %               |  |  | 6.00            | %    |  |              | 12/10/2014 |  |           |  | 12/11/2021 |      |  |   | 6,484        |  |  |   | 6,421  |  |  |   | 6,562  | 
|WNA Holdings, Inc. (Waddington)                            |  | Containers & Packaging               |   |                     | L+725 |  |            |          | 1.25 | %               |  |  | 8.50            | %    |  |              | 5/24/2013  |  |           |  | 12/7/2020  |      |  |   | 4,000        |  |  |   | 3,970  |  |  |   | 4,040  | 
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Total Bank Debt/Senior Secured Loans                       |  |                                      | $ | 276,574             |       |  | $          | 277,160  |     
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Unsecured Notes  1.8%                                     |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Apollo Investment Corporation(4)                           |  | Diversified Financial Services       |   |                     |      |  |            |          |     |                 |  |  | 5.75            | %    |  |              | 11/10/2011 |  |           |  | 1/15/2016  |      |  | $ | 3,650        |  |  | $ | 3,538  |  |  | $ | 3,716  | 
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Common Equity/Equity Interests  31.7%                     |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   | Shares/Units |  |  |   |        |  |  |   |        | 
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Engineering Solutions & Products,
LLC(7)(8)               |  | Aerospace & Defense                  |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              | 11/5/2013  |  |           |  |            |      |  |   | 133,668      |  |  | $ | 1,367  |  |  | $ | 820    | 
|First Lien Loan Program LLC(4)(6)                          |  | Asset Management                     |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              | 2/13/2015  |  |           |  |            |      |  |   | 2,958,396    |  |  |   | 29,584 |  |  |   | 28,519 | 
|Gemino Healthcare Finance,
LLC(4)(6)(9)                    |  | Diversified Financial Services       |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              | 9/30/2013  |  |           |  |            |      |  |   | 32,839       |  |  |   | 32,839 |  |  |   | 35,138 | 
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Total Common Equity/Equity Interests                       |  |                                      | $ | 63,790              |       |  | $          | 64,477   |     
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Total Investments(10)
169.7%                              |  |                                      | $ | 343,902             |       |  | $          | 345,353  |     
|Cash Equivalents  17.2%                                   |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   | Par Amount   |  |  |   |        |  |  |   |        | 
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|U.S. Treasury Bill                                         |  | Government                           |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              | 3/30/2015  |  |           |  | 4/23/2015  |      |  |   | 35,000       |  |  | $ | 35,003 |  |  | $ | 35,003 | 
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Total Investments & Cash Equivalents 186.9%               |  |                                      | $ | 378,905             |       |  | $          | 380,356  |     
|Liabilities in Excess of Other Assets  (86.9%)            |  |                                      |   |                     |       |  |            | (176,817 | )   
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 
|Net Assets  100.0%                                        |  |                                      |   |                     |       |  | $          | 203,539  |     
|                                                           |  |                                      |   |                     |       |  |            |          |      |                 |  |  |                 |      |  |              |            |  |           |  |            |      |  |   |              |  |  |   |        |  |  |   |        | 



See notes
to consolidated financial statements.



7



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS (unaudited) (continued)

March 31, 2015

(in thousands)



|(1) | Floating rate debt investments typically bear interest at a rate determined by reference to either the London Interbank Offered Rate (LIBOR or
L) index rate or the prime index rate (PRIME or P), and which typically reset monthly, quarterly or semi-annually. For each debt investment we have provided the current interest rate in effect as of March 31, 2015.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Indicates an investment that is wholly or partially held by Solar Senior Capital Ltd. through its wholly-owned financing subsidiary SUNS SPV LLC. Such investments are
pledged as collateral under the Senior Secured Revolving Credit Facility (see Note 7 to the consolidated financial statements) and are not generally available to creditors, if any, of Solar Senior Capital Ltd. The respective par amounts for
investments that are partially held through SUNS SPV LLC are: AmeriQual Group, LLC $4,735. Par balances in excess of these stated amounts are held directly by Solar Senior Capital Ltd. All other investments not listed above are wholly held through
SUNS SPV LLC.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Floating rate instruments accrue interest at a predetermined spread relative to an index, typically the LIBOR or PRIME rate. These instruments are typically subject to
a LIBOR or PRIME rate floor.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Indicates assets that the Company believes may not represent qualifying assets under Section 55(a) of the Investment Company Act of 1940 (1940
Act), as amended. If we fail to invest a sufficient portion of our assets in qualifying assets, we could be prevented from making follow-on investments in existing portfolio companies or could be required to dispose of investments at
inappropriate times in order to comply with the 1940 Act. As of March 31, 2015, on a fair value basis, non-qualifying assets in the portfolio represented 19.3% of the total assets of the Company.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | A portion of the coupon is payable in kind (PIK). Of the current 7.25% coupon, 6.50% is paid in cash and a range of 0.50%-1.00%, currently 0.75%, is PIK.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------

|(6) | Denotes investments in which we are deemed to exercise a controlling influence over the management or policies of a company, as defined in the 1940 Act, due to
beneficially owning, either directly or through one or more controlled companies, more than 25% of the outstanding voting securities of the investment. Transactions during the three months ended March 31, 2015 in these controlled investments
are as follows:
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                               |  |                                |        |  |                |   |        |                 |  |   |                     |  |  |                      |   |  |                            |   |     |  |  |   |        | 
|------------------------------ |  | ------------------------------ | ------ |  | -------------- | - | ------ | --------------- |  | - | ------------------- |  |  | -------------------- | - |  | -------------------------- | - | --- |  |  | - | ------ | 
|Name of Issuer                 |  | Fair Value atDecember 31, 2014 |        |  | GrossAdditions |   |        | GrossReductions |  |   | Realized Gain(Loss) |  |  | Dividend/OtherIncome |   |  | Fair Value atMarch 31,2015 |  
|First Lien Loan Program LLC    |  | $                              |       |  |                | $ | 29,584 |                 |  | $ |                    |  |  | $                    |  |  |                            | $ | 109 |  |  | $ | 28,519 | 
|Gemino Healthcare Finance, LLC |  |                                | 34,421 |  |                |   |       |                 |  |   |                    |  |  |                      |  |  |                            |   | 862 |  |  |   | 35,138 | 
|                               |  |                                |        |  |                |   |        |                 |  |   |                     |  |  |                      |   |  |                            |   |     |  |  |   |        | 
|                               |  | $                              | 34,421 |  |                | $ | 29,584 |                 |  | $ |                    |  |  | $                    |  |  |                            | $ | 971 |  |  | $ | 63,657 | 
|                               |  |                                |        |  |                |   |        |                 |  |   |                     |  |  |                      |   |  |                            |   |     |  |  |   |        | 



|(7) | Denotes investments in which we are an Affiliated Person but not exercising a controlling influence, as defined in the 1940 Act, due to beneficially owning,
either directly or through one or more controlled companies, more than 5% but less than 25% of the outstanding voting securities of the investment. Transactions during the three months ended March 31, 2015 in these affiliated investments are as
follows:
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                                         |  |                                |       |  |                |   |   |                 |  |   |                     |  |  |                |   |  |                            |   |    |  |  |   |       | 
|-------------------------------------------------------- |  | ------------------------------ | ----- |  | -------------- | - | - | --------------- |  | - | ------------------- |  |  | -------------- | - |  | -------------------------- | - | -- |  |  | - | ----- | 
|Name of Issuer                                           |  | Fair Value atDecember 31, 2014 |       |  | GrossAdditions |   |   | GrossReductions |  |   | Realized Gain(Loss) |  |  | InterestIncome |   |  | Fair Value atMarch 31,2015 |  
|Engineering Solutions & Products, LLC
(1st lien)         |  | $                              | 324   |  |                | $ |  |                 |  | $ |                    |  |  | $              |  |  |                            | $ | 6  |  |  | $ | 324   | 
|Engineering Solutions & Products, LLC
(2nd lien)         |  |                                | 2,343 |  |                |   |  |                 |  |   |                    |  |  |                |  |  |                            |   | 47 |  |  |   | 2,343 | 
|Engineering Solutions & Products, LLC (equity interests) |  |                                | 956   |  |                |   |  |                 |  |   |                    |  |  |                |  |  |                            |   |   |  |  |   | 820   | 
|                                                         |  |                                |       |  |                |   |   |                 |  |   |                     |  |  |                |   |  |                            |   |    |  |  |   |       | 
|                                                         |  | $                              | 3,623 |  |                | $ |  |                 |  | $ |                    |  |  | $              |  |  |                            | $ | 53 |  |  | $ | 3,487 | 
|                                                         |  |                                |       |  |                |   |   |                 |  |   |                     |  |  |                |   |  |                            |   |    |  |  |   |       | 



|(8) | Our equity investment in Engineering Solutions & Products, LLC is held through ESP SSC Corp., a taxable subsidiary.
|--- | -------------------------------------------------------------------------------------------------------------------

|(9) | Investment represents the operating company after consolidation of the holding company Gemino Senior Secured Healthcare LLC.
|--- | ----------------------------------------------------------------------------------------------------------------------------

|(10) | Aggregate net unrealized depreciation for federal income tax purposes is $895; aggregate gross unrealized appreciation and depreciation for federal tax purposes is
$2,949 and $3,844, respectively, based on a tax cost of $346,248.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Non-income producing security.
|- | ------------------------------



See notes to consolidated financial statements.



8



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS (unaudited) (continued)

March 31, 2015



|                                     |  |                                                                  |        | 
|------------------------------------ |  | ---------------------------------------------------------------- | ------ | 
|Industry Classification              |  | Percentage of TotalInvestments (atfair value) as ofMarch
31,2015 |       
|Diversified Financial Services       |  |                                                                  | 11.3%  | 
|Health Care Services                 |  |                                                                  | 8.3%   | 
|Asset Management                     |  |                                                                  | 8.3%   | 
|Insurance                            |  |                                                                  | 7.8%   | 
|Communications Equipment             |  |                                                                  | 7.2%   | 
|Professional Services                |  |                                                                  | 6.8%   | 
|Food Products                        |  |                                                                  | 6.6%   | 
|Software                             |  |                                                                  | 5.6%   | 
|Specialty Retail                     |  |                                                                  | 4.4%   | 
|Health Care Facilities               |  |                                                                  | 4.2%   | 
|Internet Software & Services         |  |                                                                  | 4.1%   | 
|Air Freight & Logistics              |  |                                                                  | 3.3%   | 
|Distributors                         |  |                                                                  | 2.8%   | 
|Health Care Technology               |  |                                                                  | 2.6%   | 
|Machinery                            |  |                                                                  | 2.6%   | 
|Real Estate Management & Development |  |                                                                  | 2.3%   | 
|Diversified Consumer Services        |  |                                                                  | 1.9%   | 
|Hotels, Restaurants & Leisure        |  |                                                                  | 1.9%   | 
|Commercial Services & Supplies       |  |                                                                  | 1.4%   | 
|Automotive Retail                    |  |                                                                  | 1.3%   | 
|Containers & Packaging               |  |                                                                  | 1.2%   | 
|Capital Markets                      |  |                                                                  | 1.2%   | 
|Aerospace & Defense                  |  |                                                                  | 1.0%   | 
|Footwear                             |  |                                                                  | 0.9%   | 
|Industrial Conglomerates             |  |                                                                  | 0.6%   | 
|Beverages                            |  |                                                                  | 0.4%   | 
|                                     |  |                                                                  |        | 
|Total Investments                    |  |                                                                  | 100.0% | 
|                                     |  |                                                                  |        | 

See notes to consolidated financial statements.



9



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS

December 31, 2014

(in thousands, except share/unit amounts)



|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|---------------------------------------------------------- |  | ------------------------------------ | - | ------------------------- |  | ------------------------------ | ----- | -------- | -------- |  | ---------- | --------------- |  |  | ---------- |  |  | ---- | ------------ |  | --------- | - | ------ |  |  | - | ------ | 
|Description                                                |  | Industry                             |   | Interest(1)               |  | Basis PointSpreadAboveIndex(3) |       |          | Maturity |  |            | AcquisitionDate |  |  | Par Amount |  |  | Cost |              |  | FairValue |  
|Bank Debt/Senior Secured Loans  148.1%                    |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Advantage Sales and Marketing, Inc                         |  | Professional Services                |   | 7.50%                     |  |                                | L+650 |          |          |  | 7/21/2022  |                 |  |  | 2/14/2013  |  |  | $    | 8,000        |  |           | $ | 7,942  |  |  | $ | 7,936  | 
|Aegis Toxicology Sciences Corporation                      |  | Health Care Services                 |   | 9.50%                     |  |                                | L+850 |          |          |  | 8/24/2021  |                 |  |  | 2/20/2014  |  |  |      | 4,000        |  |           |   | 3,945  |  |  |   | 4,000  | 
|ALG B.V. (Apple Leisure)(2)(4)                             |  | Hotels, Restaurants & Leisure        |   | 7.00%                     |  |                                | L+575 |          |          |  | 2/28/2019  |                 |  |  | 2/28/2013  |  |  |      | 2,776        |  |           |   | 2,755  |  |  |   | 2,776  | 
|ALG USA Holdings, LLC (Apple
Leisure)(2)                   |  | Hotels, Restaurants & Leisure        |   | 7.00%                     |  |                                | L+575 |          |          |  | 2/28/2019  |                 |  |  | 2/28/2013  |  |  |      | 3,679        |  |           |   | 3,652  |  |  |   | 3,679  | 
|AmeriQual Group, LLC(2)                                    |  | Food Products                        |   | 7.50% (6.5%Cash /
1% PIK) |  |                                | L+500 |          |          |  | 3/28/2016  |                 |  |  | 3/28/2011  |  |  |      | 11,159       |  |           |   | 11,112 |  |  |   | 10,964 | 
|Asurion, LLC                                               |  | Insurance                            |   | 8.50%                     |  |                                | L+750 |          |          |  | 3/3/2021   |                 |  |  | 2/27/2014  |  |  |      | 2,500        |  |           |   | 2,466  |  |  |   | 2,492  | 
|Athletico Management, LLC and Accelerated Holdings,
LLC(2) |  | Health Care Facilities               |   | 6.25%                     |  |                                | L+550 |          |          |  | 12/2/2020  |                 |  |  | 12/1/2014  |  |  |      | 15,000       |  |           |   | 14,852 |  |  |   | 14,850 | 
|Blue Coat Systems, Inc                                     |  | Internet Software & Services         |   | 9.50%                     |  |                                | L+850 |          |          |  | 6/28/2020  |                 |  |  | 6/28/2013  |  |  |      | 4,500        |  |           |   | 4,462  |  |  |   | 4,433  | 
|Blue Ribbon, LLC (Pabst)(2)                                |  | Beverages                            |   | 5.75%                     |  |                                | L+475 |          |          |  | 11/13/2021 |                 |  |  | 11/5/2014  |  |  |      | 1,500        |  |           |   | 1,485  |  |  |   | 1,495  | 
|Capstone Logistics Acqusition, Inc.(2)                     |  | Professional Services                |   | 5.50%                     |  |                                | L+450 |          |          |  | 10/7/2021  |                 |  |  | 10/3/2014  |  |  |      | 12,968       |  |           |   | 12,841 |  |  |   | 12,838 | 
|Castle Management Borrower LLC (Highgate
Hotels)(2)        |  | Real Estate Management & Development |   | 5.50%                     |  |                                | L+450 |          |          |  | 9/18/2020  |                 |  |  | 10/10/2014 |  |  |      | 11,970       |  |           |   | 11,854 |  |  |   | 11,850 | 
|CGSC of Delaware Holdings Corp (Cooper Gay).               |  | Insurance                            |   | 8.25%                     |  |                                | L+700 |          |          |  | 10/16/2020 |                 |  |  | 4/5/2013   |  |  |      | 4,000        |  |           |   | 3,954  |  |  |   | 3,600  | 
|Confie Seguros Holding II Co.(2)                           |  | Insurance                            |   | 5.75%                     |  |                                | L+450 |          |          |  | 11/9/2018  |                 |  |  | 11/9/2012  |  |  |      | 13,164       |  |           |   | 13,049 |  |  |   | 13,123 | 
|ConvergeOne Holdings Corp.(2)                              |  | Communications Equipment             |   | 6.00%                     |  |                                | L+500 |          |          |  | 6/17/2020  |                 |  |  | 6/16/2014  |  |  |      | 6,965        |  |           |   | 6,900  |  |  |   | 6,965  | 
|CT Technologies Intermediate
Holdings(2)                   |  | Health Care Technology               |   | 6.00%                     |  |                                | L+500 |          |          |  | 12/1/2021  |                 |  |  | 12/1/2014  |  |  |      | 5,000        |  |           |   | 4,950  |  |  |   | 4,950  | 
|Engineering Solutions & Products,
LLC(6)                   |  | Aerospace & Defense                  |   | 8.00%                     |  |                                | L+600 |          |          |  | 5/4/2018   |                 |  |  | 11/5/2013  |  |  |      | 324          |  |           |   | 324    |  |  |   | 324    | 
|Engineering Solutions & Products,
LLC(6)                   |  | Aerospace & Defense                  |   | 8.00%                     |  |                                | L+600 |          |          |  | 11/5/2018  |                 |  |  | 11/5/2013  |  |  |      | 2,343        |  |           |   | 2,343  |  |  |   | 2,343  | 
|Epic Health Services, Inc.(2)                              |  | Health Care Services                 |   | 6.50%                     |  |                                | L+525 |          |          |  | 10/18/2018 |                 |  |  | 10/21/2013 |  |  |      | 6,650        |  |           |   | 6,599  |  |  |   | 6,650  | 
|Filtration Group Corp                                      |  | Industrial Conglomerates             |   | 8.25%                     |  |                                | L+725 |          |          |  | 11/21/2021 |                 |  |  | 11/15/2013 |  |  |      | 2,000        |  |           |   | 1,982  |  |  |   | 2,002  | 
|Fulton Holding Corp.(2)                                    |  | Specialty Retail                     |   | 8.50%                     |  |                                |      |          |          |  | 5/28/2018  |                 |  |  | 5/10/2013  |  |  |      | 15,000       |  |           |   | 15,081 |  |  |   | 15,150 | 
|Global Tel*Link Corp                                       |  | Communications Equipment             |   | 9.00%                     |  |                                | L+775 |          |          |  | 11/23/2020 |                 |  |  | 5/21/2013  |  |  |      | 3,000        |  |           |   | 2,950  |  |  |   | 2,945  | 
|Hostway Corporation(2)                                     |  | Internet Software & Services         |   | 6.00%                     |  |                                | L+475 |          |          |  | 12/13/2019 |                 |  |  | 6/27/2014  |  |  |      | 9,750        |  |           |   | 9,709  |  |  |   | 9,750  | 
|Ikaria, Inc                                                |  | Health Care Technology               |   | 8.75%                     |  |                                | L+775 |          |          |  | 2/12/2022  |                 |  |  | 2/4/2014   |  |  |      | 4,000        |  |           |   | 3,972  |  |  |   | 3,950  | 
|Innovative Xcessories & Services, 
LLC(2)                  |  | Automotive Retail                    |   | 5.25%                     |  |                                | L+425 |          |          |  | 2/21/2020  |                 |  |  | 8/21/2014  |  |  |      | 7,289        |  |           |   | 7,220  |  |  |   | 7,289  | 
|IPC Systems, Inc.(2)                                       |  | Communications Equipment             |   | 6.00%                     |  |                                | L+500 |          |          |  | 11/8/2020  |                 |  |  | 5/02/2014  |  |  |      | 9,950        |  |           |   | 9,858  |  |  |   | 9,950  | 
|Kellermeyer Bergensons Services, LLC
(KBS)(2)              |  | Commercial Services & Supplies       |   | 6.00%                     |  |                                | L+500 |          |          |  | 10/29/2021 |                 |  |  | 10/31/2014 |  |  |      | 7,500        |  |           |   | 7,426  |  |  |   | 7,425  | 
|KODA Distribution Group, Inc.(2)                           |  | Distributors                         |   | 6.00%                     |  |                                | L+500 |          |          |  | 4/9/2018   |                 |  |  | 9/30/2013  |  |  |      | 9,712        |  |           |   | 9,684  |  |  |   | 9,664  | 
|Landslide Holdings, Inc                                    |  | Software                             |   | 8.25%                     |  |                                | L+725 |          |          |  | 2/25/2021  |                 |  |  | 2/25/2014  |  |  |      | 3,310        |  |           |   | 3,306  |  |  |   | 3,260  | 
|Material Handling Services, LLC
(TFS)(2)                   |  | Air Freight & Logistics              |   | 5.75%                     |  |                                | L+475 |          |          |  | 3/26/2020  |                 |  |  | 3/3/2014   |  |  |      | 9,775        |  |           |   | 9,688  |  |  |   | 9,677  | 
|Metamorph US 3, LLC (Metalogix)(2)                         |  | Software                             |   | 6.50%                     |  |                                | L+550 |          |          |  | 12/1/2020  |                 |  |  | 12/1/2014  |  |  |      | 15,000       |  |           |   | 14,629 |  |  |   | 14,625 | 
|Miller Heiman, Inc.(2)                                     |  | Professional Services                |   | 6.75%                     |  |                                | L+575 |          |          |  | 9/30/2019  |                 |  |  | 9/30/2013  |  |  |      | 7,319        |  |           |   | 7,254  |  |  |   | 7,172  | 
|MYI Acquiror Corp. (McLarens Young)(2)                     |  | Insurance                            |   | 5.75%                     |  |                                | L+450 |          |          |  | 5/28/2019  |                 |  |  | 5/21/2014  |  |  |      | 3,491        |  |           |   | 3,460  |  |  |   | 3,456  | 
|MYI Acquiror Ltd. (McLarens
Young)(2)(4)                   |  | Insurance                            |   | 5.75%                     |  |                                | L+450 |          |          |  | 5/28/2019  |                 |  |  | 5/21/2014  |  |  |      | 4,489        |  |           |   | 4,449  |  |  |   | 4,444  | 
|OH Acquisition, LLC (Trade Monster)(2)                     |  | Capital Markets                      |   | 7.25%                     |  |                                | L+625 |          |          |  | 8/29/2019  |                 |  |  | 9/2/2014   |  |  |      | 3,990        |  |           |   | 3,971  |  |  |   | 3,990  | 
|PM Holdings III Corp. (Pro Mach)(2)                        |  | Machinery                            |   | 5.50%                     |  |                                | L+450 |          |          |  | 10/22/2021 |                 |  |  | 10/17/2014 |  |  |      | 9,000        |  |           |   | 8,912  |  |  |   | 8,910  | 
|QBS Holding Company, Inc. (Quorum).(2)                     |  | Software                             |   | 5.75%                     |  |                                | L+475 |          |          |  | 8/7/2021   |                 |  |  | 8/1/2014   |  |  |      | 10,000       |  |           |   | 9,904  |  |  |   | 9,900  | 
|QoL Meds, LLC(2)                                           |  | Health Care Services                 |   | 5.50%                     |  |                                | L+450 |          |          |  | 7/15/2020  |                 |  |  | 7/14/2014  |  |  |      | 7,980        |  |           |   | 7,942  |  |  |   | 7,920  | 
|Richelieu Foods, Inc.(2)                                   |  | Food Products                        |   | 5.75%                     |  |                                | L+475 |          |          |  | 5/21/2020  |                 |  |  | 11/21/2014 |  |  |      | 7,000        |  |           |   | 6,897  |  |  |   | 6,895  | 
|Securus Technologies, Inc                                  |  | Communications Equipment             |   | 9.00%                     |  |                                | L+775 |          |          |  | 4/30/2021  |                 |  |  | 4/17/2013  |  |  |      | 10,000       |  |           |   | 9,921  |  |  |   | 9,850  | 
|Shoes for Crews, Inc.(2)                                   |  | Footwear                             |   | 5.50%                     |  |                                | L+425 |          |          |  | 3/27/2017  |                 |  |  | 3/27/2012  |  |  |      | 3,526        |  |           |   | 3,523  |  |  |   | 3,526  | 
|Skinnypop Popcorn, LLC(2)                                  |  | Food Products                        |   | 5.50%                     |  |                                | L+450 |          |          |  | 7/17/2019  |                 |  |  | 7/17/2014  |  |  |      | 5,000        |  |           |   | 4,954  |  |  |   | 4,950  | 
|Trident USA Health Services(2)                             |  | Health Care Services                 |   | 6.50%                     |  |                                | L+525 |          |          |  | 7/31/2019  |                 |  |  | 7/29/2013  |  |  |      | 8,993        |  |           |   | 8,924  |  |  |   | 8,858  | 
|Varsity Brands Holdings Co., Inc.(2)                       |  | Diversified Consumer Services        |   | 6.00%                     |  |                                | L+500 |          |          |  | 12/11/2021 |                 |  |  | 12/10/2014 |  |  |      | 6,500        |  |           |   | 6,435  |  |  |   | 6,504  | 
|WNA Holdings, Inc. (Waddington)                            |  | Containers & Packaging               |   | 8.50%                     |  |                                | L+725 |          |          |  | 12/7/2020  |                 |  |  | 5/24/2013  |  |  |      | 4,000        |  |           |   | 3,969  |  |  |   | 4,020  | 
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Total Bank Debt/Senior Secured Loans                       |  |                                      | $ | 301,505                   |  |                                | $     | 301,350  |         
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Unsecured Notes  1.8%                                     |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Apollo Investment Corporation(4)                           |  | Diversified Financial Services       |   | 5.75%                     |  |                                |      |          |          |  | 1/15/2016  |                 |  |  | 11/10/2011 |  |  | $    | 3,650        |  |           | $ | 3,505  |  |  | $ | 3,739  | 
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Common Equity/Equity Interests  17.4%                     |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      | Shares/Units |  |           |   |        |  |  |   |        | 
|Engineering Solutions & Products,
LLC(6)(7)               |  | Aerospace & Defense                  |   |                           |  |                                |       |          |          |  |            |                 |  |  | 11/5/2013  |  |  |      | 133,668      |  |           | $ | 1,367  |  |  | $ | 956    | 
|Gemino Healthcare Finance, LLC(4)(5)(8)                    |  | Diversified Financial Services       |   |                           |  |                                |       |          |          |  |            |                 |  |  | 9/30/2013  |  |  |      | 32,839       |  |           |   | 32,839 |  |  |   | 34,421 | 
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Total Common Equity/Equity Interests                       |  |                                      | $ | 34,206                    |  |                                | $     | 35,377   |         
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Total Investments(9)
167.3%                               |  |                                      | $ | 339,216                   |  |                                | $     | 340,466  |         
|Cash Equivalents  17.2%                                   |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      | Par Amount   |  |           |   |        |  |  |   |        | 
|U.S. Treasury Bill                                         |  | Government                           |   | 0.000%                    |  |                                |      |          |          |  | 1/29/2015  |                 |  |  | 12/29/2014 |  |  |      | 35,000       |  |           | $ | 35,000 |  |  | $ | 35,000 | 
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Total Investments & Cash Equivalents  184.5%              |  |                                      | $ | 374,216                   |  |                                | $     | 375,466  |         
|Liabilities in Excess of Other Assets  (84.5%)            |  |                                      |   |                           |  |                                |       | (171,947 | )       
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 
|Net Assets 100.0%                                         |  |                                      |   |                           |  |                                | $     | 203,519  |         
|                                                           |  |                                      |   |                           |  |                                |       |          |          |  |            |                 |  |  |            |  |  |      |              |  |           |   |        |  |  |   |        | 

See notes to consolidated financial statements.



10



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)

December 31, 2014

(in thousands)



|(1) | Floating rate debt investments typically bear interest at a rate determined by reference to either the London Interbank Offered Rate (LIBOR or
L) index rate or the prime index rate (PRIME or P), and which typically reset monthly, quarterly or semi-annually. For each debt investment we have provided the current interest rate in effect as of December 31, 2014.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Indicates an investment that is wholly or partially held by Solar Senior Capital Ltd. through its wholly-owned financing subsidiary SUNS SPV LLC. Such investments are
pledged as collateral under the Senior Secured Revolving Credit Facility (see Note 7 to the consolidated financial statements) and are not generally available to the creditors, if any, of Solar Senior Capital Ltd. The respective par amounts for
investments that are partially held through SUNS SPV LLC are: AmeriQual Group, LLC $4,722; Athletico Management, LLC and Accelerated Holdings, LLC $10,000; Capstone Logistics Acquisition, Inc. $8,479; Castle Management Borrower LLC $7,980;
Kellermeyer Bergensons Services, LLC $5,000; and Metamorph US 3, LLC $10,000. Par balances in excess of these stated amounts are held directly by Solar Senior Capital Ltd. All other investments not listed above are wholly held through SUNS SPV LLC.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Floating rate instruments accrue interest at a predetermined spread relative to an index, typically the LIBOR or PRIME rate. These instruments are typically subject to
a LIBOR or PRIME rate floor.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Indicates assets that the Company believes may not represent qualifying assets under Section 55(a) of the Investment Company Act of 1940 (1940
Act), as amended.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(5) | Denotes investments in which we are deemed to exercise a controlling influence over the management or policies of a company, as defined in the 1940 Act, due to
beneficially owning, either directly or through one or more controlled companies, more than 25% of the outstanding voting securities of the investment. Transactions during the year ended December 31, 2014 in these controlled investments are as
follows:
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                               |  |                                |        |  |                |   |   |                 |  |   |                     |  |  |                |   |  |                               |   |       |  |  |   |        | 
|------------------------------ |  | ------------------------------ | ------ |  | -------------- | - | - | --------------- |  | - | ------------------- |  |  | -------------- | - |  | ----------------------------- | - | ----- |  |  | - | ------ | 
|Name of Issuer                 |  | Fair Value atDecember 31, 2013 |        |  | GrossAdditions |   |   | GrossReductions |  |   | Realized Gain(Loss) |  |  | DividendIncome |   |  | Fair Value atDecember 31,2014 |  
|Gemino Healthcare Finance, LLC |  | $                              | 34,500 |  |                | $ |  |                 |  | $ |                    |  |  | $              |  |  |                               | $ | 3,277 |  |  | $ | 34,421 | 
|                               |  |                                |        |  |                |   |   |                 |  |   |                     |  |  |                |   |  |                               |   |       |  |  |   |        | 



|(6) | Denotes investments in which we are an Affiliated Person but not exercising a controlling influence, as defined in the 1940 Act, due to beneficially owning,
either directly or through one or more controlled companies, more than 5% but less than 25% of the outstanding voting securities of the investment. Transactions during the year ended December 31, 2014 in these affiliated investments are as
follows:
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



|                                                         |  |                                |       |  |                |   |     |                 |  |   |                     |  |  |                |   |  |                               |   |     |  |  |   |       | 
|-------------------------------------------------------- |  | ------------------------------ | ----- |  | -------------- | - | --- | --------------- |  | - | ------------------- |  |  | -------------- | - |  | ----------------------------- | - | --- |  |  | - | ----- | 
|Name of Issuer                                           |  | Fair Value atDecember 31, 2013 |       |  | GrossAdditions |   |     | GrossReductions |  |   | Realized Gain(Loss) |  |  | InterestIncome |   |  | Fair Value atDecember 31,2014 |  
|Engineering Solutions & Products, LLC (revolving loan)   |  | $                              |      |  |                | $ | 231 |                 |  | $ | 231                 |  |  | $              |  |  |                               | $ | 2   |  |  | $ |      | 
|Engineering Solutions & Products, LLC
(1st lien)         |  |                                | 405   |  |                |   |    |                 |  |   | 81                  |  |  |                |  |  |                               |   | 27  |  |  |   | 324   | 
|Engineering Solutions & Products, LLC
(2nd lien)         |  |                                | 2,637 |  |                |   |    |                 |  |   | 294                 |  |  |                |  |  |                               |   | 192 |  |  |   | 2,343 | 
|Engineering Solutions & Products, LLC (equity interests) |  |                                | 1,367 |  |                |   |    |                 |  |   |                    |  |  |                |  |  |                               |   |    |  |  |   | 956   | 
|                                                         |  |                                |       |  |                |   |     |                 |  |   |                     |  |  |                |   |  |                               |   |     |  |  |   |       | 
|                                                         |  | $                              | 4,409 |  |                | $ | 231 |                 |  | $ | 606                 |  |  | $              |  |  |                               | $ | 221 |  |  | $ | 3,623 | 
|                                                         |  |                                |       |  |                |   |     |                 |  |   |                     |  |  |                |   |  |                               |   |     |  |  |   |       | 



|(7) | Our equity investment in Engineering Solutions & Products, LLC is held through ESP SSC Corporation, a taxable subsidiary.
|--- | -------------------------------------------------------------------------------------------------------------------------

|(8) | Investment represents the operating company after consolidation of the holding company Gemino Senior Secured Healthcare LLC.
|--- | ----------------------------------------------------------------------------------------------------------------------------

|(9) | Aggregate net unrealized depreciation for U.S. federal income tax purposes is $1,496; aggregate gross unrealized appreciation and depreciation for federal tax purposes
is $1,822 and $3,318, respectively, based on a tax cost of $341,962.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Non-income producing security.
|- | ------------------------------



See notes to consolidated financial statements.



11



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

CONSOLIDATED SCHEDULE OF INVESTMENTS (continued)

December 31, 2014



|                                     |  |                                                                      |        | 
|------------------------------------ |  | -------------------------------------------------------------------- | ------ | 
|Industry Classification              |  | Percentage of TotalInvestments (atfair value) as ofDecember 31,
2014 |       
|Diversified Financial Services       |  |                                                                      | 11.2%  | 
|Communications Equipment             |  |                                                                      | 8.7%   | 
|Professional Services                |  |                                                                      | 8.2%   | 
|Software                             |  |                                                                      | 8.2%   | 
|Health Care Services                 |  |                                                                      | 8.1%   | 
|Insurance                            |  |                                                                      | 8.0%   | 
|Food Products                        |  |                                                                      | 6.7%   | 
|Specialty Retail                     |  |                                                                      | 4.4%   | 
|Health Care Facilities               |  |                                                                      | 4.4%   | 
|Internet Software & Services         |  |                                                                      | 4.2%   | 
|Real Estate Management & Development |  |                                                                      | 3.5%   | 
|Air Freight & Logistics              |  |                                                                      | 2.8%   | 
|Distributors                         |  |                                                                      | 2.8%   | 
|Health Care Technology               |  |                                                                      | 2.6%   | 
|Machinery                            |  |                                                                      | 2.6%   | 
|Commercial Services & Supplies       |  |                                                                      | 2.2%   | 
|Automotive Retail                    |  |                                                                      | 2.1%   | 
|Hotels, Restaurants & Leisure        |  |                                                                      | 1.9%   | 
|Diversified Consumer Services        |  |                                                                      | 1.9%   | 
|Containers & Packaging               |  |                                                                      | 1.2%   | 
|Capital Markets                      |  |                                                                      | 1.2%   | 
|Aerospace & Defense                  |  |                                                                      | 1.1%   | 
|Footwear                             |  |                                                                      | 1.0%   | 
|Industrial Conglomerates             |  |                                                                      | 0.6%   | 
|Beverages                            |  |                                                                      | 0.4%   | 
|                                     |  |                                                                      |        | 
|Total Investments                    |  |                                                                      | 100.0% | 
|                                     |  |                                                                      |        | 

See notes to consolidated financial statements.



12



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited)

March 31, 2015

(in thousands, except share amounts)

Note 1. Organization

Solar Senior Capital Ltd. (Solar Senior, the Company, SUNS, we, us, or
our), a Maryland corporation formed on December 16, 2010, is a closed-end, externally managed, non-diversified management investment company that has elected to be treated as a business development company (BDC) under
the Investment Company Act of 1940 (the 1940 Act). Furthermore, as the Company is an investment company, it continues to apply the guidance in FASB Accounting Standards Codification (ASC) Topic 946. In addition, for tax
purposes, we have elected to be treated as a regulated investment company (RIC), under the Internal Revenue Code of 1986, as amended (the Code).

On January 28, 2011, Solar Senior was capitalized with initial equity of $2 and commenced operations. On February 24, 2011, Solar Senior priced its initial public offering, selling
9.0 million shares, including the underwriters over-allotment, at a price of $20.00 per share. Concurrent with this offering, management purchased an additional 500,000 shares through a private placement, also at $20.00 per share.

The Companys investment objective is to seek to maximize current income consistent with the preservation of capital. We
seek to achieve our investment objective by directly or indirectly investing primarily in senior secured loans, including first lien and second lien debt instruments, made primarily to leveraged private middle-market companies whose debt is rated
below investment grade, which the Company refers to collectively as senior loans. From time to time, we may also invest in public companies that are thinly traded. Under normal market conditions, at least 80% of the value of the
Companys net assets (including the amount of any borrowings for investment purposes) will be invested in senior loans.

Note 2.
Significant Accounting Policies

The accompanying consolidated financial statements have been prepared on the accrual basis
of accounting in conformity with accounting principles generally accepted in the United States of America (GAAP), and include the accounts of the Company and its wholly-owned subsidiaries. The consolidated financial statements reflect
all adjustments and reclassifications which, in the opinion of management, are necessary for the fair presentation of the results of the operations and financial condition for the periods presented. All significant intercompany balances and
transactions have been eliminated. Certain prior period amounts may have been reclassified to conform to current period presentation.

Interim consolidated financial statements are prepared in accordance with GAAP for interim financial information and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X, as
appropriate. Accordingly, they may not include all of the information and notes required by GAAP for annual consolidated financial statements. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and
liabilities at the date of the financial statements and the reported amounts of income and expenses during the reported periods. Changes in the economic environment, financial markets and any other parameters used in determining these estimates
could cause actual results to differ materially. The current periods results of operations will not necessarily be indicative of results that ultimately may be achieved for the fiscal year ending on December 31, 2015.

In the opinion of management, all adjustments which are of a normal recurring nature considered necessary for the fair presentation of
financial statements, have been included.

The significant accounting policies consistently followed by the Company are:



| | (a) | Investment transactions are accounted for on the trade date;
| | --- | ------------------------------------------------------------



13



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



| | (b) | The Company conducts the valuation of its assets in accordance with GAAP and the 1940 Act. The Company generally values its assets on a quarterly basis, or more
frequently if required. Investments for which market quotations are readily available on an exchange are valued at the closing price on the date of valuation. The Company may also obtain quotes with respect to certain of its investments from pricing
services or brokers or dealers in order to value assets. When doing so, management determines whether the quote obtained is sufficient according to GAAP to determine the fair value of the investment. If determined adequate, the Company uses the
quote obtained. Debt investments with maturities of 60 days or less shall each be valued at cost plus accreted discount, or minus amortized premium, which is expected to approximate fair value, unless such valuation, in the judgment of Solar Capital
Partners, LLC (the Investment Adviser), does not represent fair value, in which case such investments shall be valued at fair value as determined in good faith by or under the direction of the Companys board of directors (the
Board).
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Investments for which reliable market quotations are not readily available or for which the
pricing sources do not provide a valuation or methodology or provide a valuation or methodology that, in the judgment of the Investment Adviser or the Board does not represent fair value, shall be valued as follows: (i) each portfolio company
or investment is initially valued by the investment professionals responsible for the portfolio investment; (ii) preliminary valuations are discussed with senior management of the Investment Adviser; (iii) independent valuation firms
engaged by, or on behalf of, the Board will conduct independent appraisals and review the Investment Advisers preliminary valuations and make their own independent assessment for (a) each portfolio investment that, when taken together
with all other investments in the same portfolio company, exceeds 10% of estimated total assets, plus available borrowings, as of the end of the most recently completed fiscal quarter, and (b) each portfolio investment that is presently in
payment default; (iv) the Board will discuss the valuations and determine the fair value of each investment in our portfolio in good faith based on the input of the Investment Adviser and, where appropriate, the respective independent valuation
firm.

The recommendation of fair value generally considers the following factors among others, as relevant: applicable market
yields; the nature and realizable value of any collateral; the portfolio companys ability to make payments; the portfolio companys earnings and discounted cash flow; the markets in which the issuer does business; and comparisons to
publicly traded securities, among others.

When an external event such as a purchase transaction, public offering or subsequent
equity sale occurs, the Company will consider the pricing indicated by the external event to corroborate the valuation. 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 investments may differ significantly from the values that would have been used had a readily available market value existed for such investments, and the differences could be material.

Investments are valued utilizing a market approach, an income approach, or both approaches, as appropriate. The market approach uses
prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business). The income approach uses valuation techniques to convert future amounts (for example, cash flows
or earnings) to a single present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. In following these approaches, the types of factors that we may take into account in
fair value pricing our investments include, as relevant: available current market data, including relevant and applicable market trading and transaction comparables, applicable market yields and multiples, security covenants, call protection
provisions, the nature and realizable value of any collateral, the portfolio companys ability to make payments, its earnings and



14



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



discounted cash flows, the markets in which the portfolio company does business, comparisons of financial ratios of peer companies that are public, M&A comparables, and enterprise values,
among other factors. When available, broker quotations and/or quotations provided by pricing services are considered as an input in the valuation process. For the three months ended March 31, 2015, there has been no change to the Companys
valuation techniques and the nature of the related inputs considered in the valuation process.

ASC Topic 820 classifies the
inputs used to measure these fair values into the following hierarchy:

Level 1: Quoted prices in active markets for
identical assets or liabilities, accessible by the Company at the measurement date.

Level 2: Quoted prices for similar
assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or other observable inputs other than quoted prices.

Level 3: Unobservable inputs for the asset or liability.

In all cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level of input that is significant to the fair value
measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each investment. The exercise of judgment is based in part on our knowledge of
the asset class and our prior experience.



| | (c) | Gains or losses on investments are calculated by using the specific identification method.
| | --- | ------------------------------------------------------------------------------------------



| | (d) | The Company records interest, adjusted for amortization of premium and accretion of discount, on an accrual basis. Loan origination fees, original issue discount, and
market discounts are capitalized and we amortize such amounts into income using the interest method or on a straight-line basis, as applicable. Upon the prepayment of a loan, any unamortized loan origination fees are recorded as interest income. We
record call premiums on loans repaid as interest income when we receive such amounts. Capital structuring fees, amendment fees, consent fees, and any other non-recurring fee income as well as management fee and other fee income for services
rendered, if any, are recorded as other income when earned.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (e) | The Company intends to comply with the applicable provisions of the Internal Revenue Code pertaining to regulated investment companies to make distributions of taxable
income sufficient to relieve it of substantially all U.S. federal income taxes. The Company, at its discretion, may carry forward taxable income in excess of calendar year distributions and pay a 4% excise tax on this income. The Company will accrue
excise tax on such estimated excess taxable income as appropriate. As of March 31, 2015 the accrual for excise tax was $0.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (f) | Book and tax basis differences relating to stockholder distributions and other permanent book and tax differences are typically reclassified among the Companys
capital accounts annually. In addition, the character of income and gains to be distributed is determined in accordance with income tax regulations that may differ from GAAP.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (g) | Distributions to common stockholders are recorded as of the record date. The amount to be paid out as a distribution is determined by the Board. Net realized capital
gains, if any, are generally distributed or deemed distributed at least annually.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (h) | In accordance with Regulation S-X and ASC Topic 810Consolidation, the Company consolidates its interest in investment company
subsidiaries, financing subsidiaries and certain wholly-owned holding
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



15



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



| | companies that serve to facilitate investment in portfolio companies. In addition, the Company may also consolidate any controlled operating companies substantially all of whose business
consists of providing services to the Company.
| | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (i) | The accounting records of the Company are maintained in U.S. dollars. Any assets and liabilities denominated in foreign currencies are translated into U.S. dollars
based on the rate of exchange of such currencies against the U.S. dollar on the date of valuation. The Company will 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. Such fluctuations would be included with the net unrealized gain or loss from investments. The Companys investments in foreign securities, if any, may involve certain
risks, including without limitation: 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 in terms of U.S. dollars and therefore the earnings of the Company.
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (j) | The Company has made an irrevocable election to apply the fair value option of accounting to its senior secured revolving credit facility (the Credit
Facility), in accordance with ASC 825-10 and uses an independent third-party valuation firm to assist in measuring its fair value.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (k) | The Company may record origination and other expenses related to certain debt issuances as prepaid assets. These expenses are deferred and amortized using either the
effective interest method or the straight-line method over the stated life. The straight-line method may be used on revolving facilities and when it approximates the effective yield method.
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (l) | The Company records expenses related to shelf filings and applicable equity offering costs as prepaid assets. These expenses are charged as a reduction of capital upon
utilization, in accordance with ASC 946-20-25.
| | --- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (m) | Investments that are expected to pay regularly scheduled interest in cash are generally placed on non-accrual status when principal or interest cash payments are past
due 30 days or more and/or when it is no longer probable that principal or interest cash payments will be collected. Such non-accrual investments are restored to accrual status if past due principal and interest are paid in cash, and in
managements judgment, are likely to continue timely payment of their remaining principal and interest obligations. Cash interest payments received on such investments may be recognized as income or applied to principal depending on
managements judgment.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (n) | The Company defines cash equivalents as securities that are readily convertible into known amounts of cash and so near their maturity that they present insignificant
risk of changes in value because of changes in interest rates. Generally, only securities with a maturity of three months or less from the date of issue would qualify, with limited exceptions. The Company believes that certain U.S. Treasury bills,
repurchase agreements and other high-quality, short-term debt securities would qualify as cash equivalents.
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Recent Accounting Pronouncements

In February 2015, the Financial Accounting Standards Board issued Accounting Standards Update 2015-02, Consolidation (Topic 810)Amendments to the Consolidation Analysis. The update changes the
analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. Public companies are required to apply ASU 2015-02 for interim and annual



16



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



reporting periods beginning after December 15, 2015. Accordingly, the Company is currently evaluating the impact of the adoption of ASU 2015-02 on its consolidated financial statements and
disclosures.

In April 2015, the Financial Accounting Standards Board issued Accounting Standards Update 2015-03,
InterestImputation of Interest (Subtopic 835-30)Simplifying the Presentation of Debt Issuance Costs. The update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct
deduction from the carrying amount of that debt liability, consistent with debt discounts. Public companies are required to apply ASU 2015-03 retrospectively for interim and annual reporting periods beginning after December 15, 2015.
Accordingly, the Company is currently evaluating the impact of the adoption of ASU 2015-03 on its consolidated financial statements and disclosures.

Note 3. Agreements

Solar Senior has an Investment Advisory and Management
Agreement with the Investment Adviser, under which the Investment Adviser manages the day-to-day operations of, and provides investment advisory services to, Solar Senior. For providing these services, the Investment Adviser receives a fee from
Solar Senior, consisting of two componentsa base management fee and an incentive fee. The base management fee is calculated at an annual rate of 1.00% of gross assets. For services rendered under the Investment Advisory and Management
Agreement, the base management fee is payable quarterly in arrears. The base management fee is calculated based on the average value of our gross assets at the end of the two most recently completed calendar quarters. Base management fees for any
partial month or quarter will be appropriately pro-rated. From time-to-time we may purchase U.S. Treasury bills or other high-quality, short-term debt securities at or near the end of the quarter and typically close out the position on a net cash
basis subsequent to quarter end. We may also utilize repurchase agreements or other balance sheet transactions, including drawing down on our credit facilities, as deemed appropriate. The amount of these transactions or such drawn cash for this
purpose is excluded from total assets for purposes of computing the asset base upon which the management fee is determined.

The incentive fee has two parts, as follows: one is calculated and payable quarterly in arrears based on our pre-incentive fee net
investment income for the immediately preceding calendar quarter. For this purpose, pre-incentive fee net investment income means interest income, dividend income and any other income (other than fees for providing managerial assistance) accrued
during the calendar quarter, minus our operating expenses for the quarter (excluding the incentive fee). Pre-incentive fee net investment income includes, in the case of investments, if any, with a deferred interest feature (such as original issue
discount, debt instruments with pay-in-kind interest and zero-coupon securities), accrued income that we have not yet received in cash. Pre-incentive fee net investment income does not include any realized capital gains, computed net of all realized
capital losses or unrealized capital depreciation. Pre-incentive fee net investment income, expressed as a rate of return on the value of our net assets at the end of the immediately preceding calendar quarter, is compared to a hurdle of
1.75% per quarter (7.00% annualized). The Company pays the Investment Adviser an incentive fee with respect to pre-incentive fee net investment income for each calendar quarter as follows:



| |  |  | no incentive fee in any calendar quarter in which our pre-incentive fee net investment income does not exceed the hurdle of 1.75%;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------



| |  |  | 50% of pre-incentive fee net investment income with respect to that portion of such pre-incentive fee net investment income, if any, that exceeds the
hurdle but is less than 2.9167% in any calendar quarter (11.67% annualized);
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



17



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



and



| |  |  | 20% of the amount of pre-incentive fee net investment income, if any, that exceeds 2.9167% in any calendar quarter (11.67% annualized) will be payable
to the Investment Adviser.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

For the three months ended March 31, 2015 and 2014, the Company recognized
$866 and $687, respectively, in base management fees and $157 and $213, respectively, in performance-based incentive fees. For the three months ended March 31, 2015 and 2014, $157 and $0, respectively, of such performance-based incentive fees
were waived. This voluntary fee waiver was made at the Investment Advisers discretion and is not subject to recapture by the Investment Adviser or reimbursement by the Company.

The second part of the incentive fee is determined and payable in arrears as of the end of each calendar year (or upon termination of the
Investment Advisory Agreement, as of the termination date) and will equal 20% of the Companys cumulative realized capital gains less cumulative realized capital losses, unrealized capital depreciation (unrealized depreciation on a gross
investment-by-investment basis at the end of each calendar year) and all net capital gains upon which prior performance-based capital gains incentive fee payments were previously made to the Investment Adviser. For financial statement purposes, the
second part of the incentive fee is accrued based upon 20% of cumulative net realized gains and net unrealized capital appreciation. No accrual was required for the three months ended March 31, 2015 and 2014.

Solar Senior has also entered into an Administration Agreement with Solar Capital Management, LLC (the Administrator) under
which the Administrator provides administrative services for Solar Senior. For providing these services, facilities and personnel, Solar Senior reimburses the Administrator for Solar Seniors allocable portion of overhead and other expenses
incurred by the Administrator in performing its obligations under the Administration Agreement, including rent. The Administrator will also provide, on Solar Seniors behalf, managerial assistance to those portfolio companies to which Solar
Senior is required to provide such assistance.

For the three months ended March 31, 2015 and 2014, the Company
recognized expenses under the Administration Agreement of $254 and $242, respectively. No managerial assistance fees were accrued or collected for the three months ended March 31, 2015 and 2014.

Note 4. Net Asset Value Per Share

At March 31, 2015, the Companys total net assets and net asset value per share were $203,539 and $17.65, respectively. This compares to total net assets and net asset value per share at
December 31, 2014 of $203,519 and $17.65, respectively.

Note 5. Earnings Per Share

The following table sets forth the computation of basic and diluted net increase in net assets per share resulting from operations,
pursuant to ASC 260-10, for the three months ended March 31, 2015 and 2014:



|                                                                |  |                             |            |  |      |   |            | 
|--------------------------------------------------------------- |  | --------------------------- | ---------- |  | ---- | - | ---------- | 
|                                                                |  | Three months
endedMarch 31, |           
|                                                                |  | 2015                        |            |  | 2014 |  
|Earnings per share (basic & diluted)                            |  |                             |            |  |      |   |            | 
|Numeratornet increase in net assets resulting from operations: |  | $                           | 4,086      |  |      | $ | 3,988      | 
|Denominatorweighted average shares:                            |  |                             | 11,533,315 |  |      |   | 11,531,975 | 
|Earnings per share:                                             |  | $                           | 0.35       |  |      | $ | 0.35       | 



18



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



Note 6. Fair Value

Fair value is defined as the price 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. GAAP establishes a
framework for measuring fair value that includes a hierarchy used to classify the inputs used in measuring fair value. The hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels. The level in the fair
value hierarchy within which the fair value measurement falls is determined based on the lowest level input that is significant to the fair value measurement. The levels of the fair value hierarchy are as follows:

Level 1. Financial assets and liabilities whose values are based on unadjusted quoted prices for identical assets or
liabilities in an active market that the Company has the ability to access.

Level 2. Financial assets and
liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable either directly or indirectly for substantially the full term of the asset or liability. Level 2 inputs include the following:



| | a) | Quoted prices for similar assets or liabilities in active markets;
| | -- | ------------------------------------------------------------------



| | b) | Quoted prices for identical or similar assets or liabilities in non-active markets;
| | -- | -----------------------------------------------------------------------------------



| | c) | Pricing models whose inputs are observable for substantially the full term of the asset or liability; and
| | -- | ---------------------------------------------------------------------------------------------------------



| | d) | Pricing models whose inputs are derived principally from or corroborated by observable market data through correlation or other means for substantially the full term of
the asset or liability.
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Level 3. Financial assets and liabilities whose values are based on prices
or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. These inputs reflect managements and, if applicable, an independent third-party valuation firms own assumptions
about the assumptions a market participant would use in pricing the asset or liability.

When the inputs used to measure fair
value fall within different levels of the hierarchy, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement in its entirety. For example, a Level 3
fair value measurement may include inputs that are observable (Levels 1 and 2) and unobservable (Level 3).

Gains and losses for assets and liabilities categorized within the Level 3 table below may include changes in fair value that are
attributable to both observable inputs (Levels 1 and 2) and unobservable inputs (Level 3).

A review of fair
value hierarchy classifications is conducted on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification for certain financial assets or liabilities. Such reclassifications are reported as transfers in/out
of the appropriate category as of the end of the quarter in which the reclassifications occur.



19



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



The following tables present the balances of assets and liabilities measured at fair
value on a recurring basis, as of March 31, 2015 and December 31, 2014:

Fair Value Measurements

As of March 31, 2015



|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|------------------------------ |  | ------- | - |  | ------- | - | ------ | ------- |  | - | ------- |  |  | - | ------- | 
|                               |  | Level 1 |   |  | Level 2 |   |        | Level 3 |  |   | Total   | 
|Assets:                        |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Bank Debt/Senior Secured Loans |  | $       |  |  |         | $ | 55,065 |         |  | $ | 222,095 |  |  | $ | 277,160 | 
|Unsecured Notes                |  |         |  |  |         |   | 3,716  |         |  |   |        |  |  |   | 3,716   | 
|Common Equity/Equity Interests |  |         |  |  |         |   |       |         |  |   | 64,477  |  |  |   | 64,477  | 
|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Total Investments              |  |         |  |  |         |   | 58,781 |         |  |   | 286,572 |  |  |   | 345,353 | 
|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Liabilities:                   |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Credit Facility                |  | $       |  |  |         | $ |       |         |  | $ | 140,900 |  |  | $ | 140,900 | 
|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 

Fair Value Measurements

As of December 31, 2014



|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|------------------------------ |  | ------- | - |  | ------- | - | ------ | ------- |  | - | ------- |  |  | - | ------- | 
|                               |  | Level 1 |   |  | Level 2 |   |        | Level 3 |  |   | Total   | 
|Assets:                        |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Bank Debt/Senior Secured Loans |  | $       |  |  |         | $ | 49,527 |         |  | $ | 251,823 |  |  | $ | 301,350 | 
|Unsecured Notes                |  |         |  |  |         |   | 3,739  |         |  |   |        |  |  |   | 3,739   | 
|Common Equity/Equity Interests |  |         |  |  |         |   |       |         |  |   | 35,377  |  |  |   | 35,377  | 
|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Total Investments              |  | $       |  |  |         | $ | 53,266 |         |  | $ | 287,200 |  |  | $ | 340,466 | 
|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Liabilities:                   |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 
|Credit Facility                |  | $       |  |  |         | $ |       |         |  | $ | 143,200 |  |  | $ | 143,200 | 
|                               |  |         |   |  |         |   |        |         |  |   |         |  |  |   |         | 



20



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



The following table provides a summary of the changes in fair value of Level 3 assets
and liabilities for the three months ended March 31, 2015, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at March 31, 2015:

Fair Value Measurements Using Level 3 Inputs



|                                                                                                                                        |  |                               |         |   |                              |   |        |  
|--------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------- | ------- | - | ---------------------------- | - | ------ | -
|                                                                                                                                        |  | Bank Debt/SeniorSecured Loans |         |   | CommonEquity/EquityInterests |  
|Fair value, December 31, 2014                                                                                                           |  | $                             | 251,823 |   |                              | $ | 35,377 |  
|Total gains or losses included in earnings:                                                                                             |  |                               |         |   |                              |   |        |  
|Net realized gain (loss)                                                                                                                |  |                               | 10      |   |                              |   |       |  
|Net change in unrealized gain (loss)                                                                                                    |  |                               | 10      |   |                              |   | (484   | )
|Purchase of investment securities                                                                                                       |  |                               | 19,850  |   |                              |   | 29,584 |  
|Proceeds from dispositions of investment securities                                                                                     |  |                               | (49,598 | ) |                              |   |       |  
|Transfers in/out of Level 3                                                                                                             |  |                               |        |   |                              |   |       |  
|                                                                                                                                        |  |                               |         |   |                              |   |        |  
|Fair value, March 31, 2015                                                                                                              |  | $                             | 222,095 |   |                              | $ | 64,477 |  
|                                                                                                                                        |  |                               |         |   |                              |   |        |  
|Unrealized gains (losses) for the period relating to those Level 3 assets that were still held by the Company at the end of the
period: |  |                               |         |   |                              |   |        |  
|Net change in unrealized gain (loss):                                                                                                   |  | $                             | 153     |   |                              | $ | (484   | )
|                                                                                                                                        |  |                               |         |   |                              |   |        |  

During the three months ended March 31, 2015, there were no transfers in and out of Levels 1 and 2.

The following table shows a reconciliation of the beginning and ending balances for fair valued liabilities measured using
significant unobservable inputs (Level 3) for the three months ended March 31, 2015:



|                                          |  |   |         |  
|----------------------------------------- |  | - | ------- | -
|Beginning fair value at December 31, 2014 |  | $ | 143,200 |  
|Borrowings                                |  |   | 12,100  |  
|Repayments                                |  |   | (14,400 | )
|Transfers in/out of Level 3               |  |   |        |  
|                                          |  |   |         |  
|Ending fair value at March 31, 2015       |  | $ | 140,900 |  
|                                          |  |   |         |  

The Company has made an irrevocable election to apply the fair value option of accounting to the Credit
Facility, in accordance with ASC 825-10. On March 31, 2015, there were borrowings of $140,900 on the Credit Facility. For the three months ended March 31, 2015, the Credit Facility had no net change in unrealized (appreciation)
depreciation. The Company uses an independent third-party valuation firm to assist in measuring the fair value of our Credit Facility.



21



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



The following table provides a summary of the changes in fair value of Level 3 assets
and liabilities for the year ended December 31, 2014, as well as the portion of gains or losses included in income attributable to unrealized gains or losses related to those assets and liabilities still held at December 31, 2014:

Fair Value Measurements Using Level 3 Inputs



|                                                                                                                                        |  |                               |          |   |                              |   |        |  
|--------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------- | -------- | - | ---------------------------- | - | ------ | -
|                                                                                                                                        |  | Bank Debt/SeniorSecured Loans |          |   | CommonEquity/EquityInterests |  
|Fair value, December 31, 2013                                                                                                           |  | $                             | 185,330  |   |                              | $ | 35,867 |  
|Total gains or losses included in earnings:                                                                                             |  |                               |          |   |                              |   |        |  
|Net realized gain (loss)                                                                                                                |  |                               | (644     | ) |                              |   |       |  
|Net change in unrealized gain (loss)                                                                                                    |  |                               | 146      |   |                              |   | (490   | )
|Purchase of investment securities                                                                                                       |  |                               | 184,392  |   |                              |   |       |  
|Proceeds from dispositions of investment securities                                                                                     |  |                               | (121,941 | ) |                              |   |       |  
|Transfers in/out of Level 3                                                                                                             |  |                               | 4,540    |   |                              |   |       |  
|                                                                                                                                        |  |                               |          |   |                              |   |        |  
|Fair value, December 31, 2014                                                                                                           |  | $                             | 251,823  |   |                              | $ | 35,377 |  
|                                                                                                                                        |  |                               |          |   |                              |   |        |  
|Unrealized gains (losses) for the period relating to those Level 3 assets that were still held by the Company at the end of the
period: |  |                               |          |   |                              |   |        |  
|Net change in unrealized gain (loss):                                                                                                   |  | $                             | (465     | ) |                              | $ | (490   | )
|                                                                                                                                        |  |                               |          |   |                              |   |        |  

During the fiscal year ended December 31, 2014, investments with a fair value of $4,540 were
transferred from Level 2 to Level 3. These transfers were a result of changes in the quantity and quality of information used as valuation inputs by the Investment Adviser. There were no other transfers between levels.

The following table shows a reconciliation of the beginning and ending balances for fair valued liabilities measured using significant
unobservable inputs (Level 3) for the year ended December 31, 2014:



|                                          |  |   |          |  
|----------------------------------------- |  | - | -------- | -
|Beginning fair value at December 31, 2013 |  | $ | 61,400   |  
|Borrowings                                |  |   | 206,100  |  
|Repayments                                |  |   | (124,300 | )
|Transfers in/out of Level 3               |  |   |         |  
|                                          |  |   |          |  
|Ending fair value at December 31, 2014    |  | $ | 143,200  |  
|                                          |  |   |          |  

The Company has made an irrevocable election to apply the fair value option of accounting to the Credit
Facility, in accordance with ASC 825-10. On December 31, 2014, there were borrowings of $143,200 on the Credit Facility. For the year ended December 31, 2014, the Credit Facility had no net change in unrealized (appreciation) depreciation.
The Company uses an independent third-party valuation firm to assist in measuring the fair value of our Credit Facility.

Quantitative Information about Level 3 Fair Value Measurements

The Company typically determines the fair value of its performing debt investments utilizing a yield analysis. In a yield analysis, a
price is ascribed for each investment based upon an assessment of current and expected market yields for similar investments and risk profiles. Additional consideration is given to current



22



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



contractual interest rates, relative maturities and other key terms and risks associated with an investment. Among other factors, a significant determinant of risk is the amount of leverage used
by the portfolio company relative to the total enterprise value of the company, and the rights and remedies of our investment within each portfolio company.

Significant unobservable quantitative inputs typically used in the fair value measurement of the Companys Level 3 assets and liabilities primarily reflect current market yields, including indices,
and readily available quotes from brokers, dealers, and pricing services as indicated by comparable assets and liabilities, as well as enterprise values, returns on equity and earnings before income taxes, depreciation and amortization
(EBITDA) multiples of similar companies, and comparable market transactions for equity securities.

Quantitative
information about the Companys Level 3 asset and liability fair value measurements as of March 31, 2015 is summarized in the table below:



|                                 |  |                   |  |                             |                  |  |                                           |                                                  |                    |                                              |                         |                                                           
|-------------------------------- |  | ----------------- |  | --------------------------- | ---------------- |  | ----------------------------------------- | ------------------------------------------------ | ------------------ | -------------------------------------------- | ----------------------- | ----------------------------------------------------------
|                                 |  | Asset orLiability |  | Fair Value atMarch 31, 2015 |                  |  | Principal 
ValuationTechnique/Methodology |                                                  | Unobservable Input |                                              | Range (WeightedAverage)
|Bank Debt / Senior Secured Loans |  | Asset             |  | $                           | 222,095          |  |                                           | Yield Analysis                                   |                    | Market Yield                                 |                         | 5.3%  10.5% (6.8%)                                       
|Common Equity/Equity Interests   |  | Asset             |  | $$
$                        | 82035,138
28,519 |  |                                           | Enterprise ValueEnterprise Value Net Asset Value |                    | EBITDA MultipleReturn on Equity Market Yield |                         | 9.7x  11.8x (9.7x)6.5%  11.6% (10.8%)
5.3%  7.1% (6.0%)
|Credit Facility                  |  | Liability         |  | $                           | 140,900          |  |                                           | Yield Analysis                                   |                    | Market Yield                                 |                         | L+0.5%  L+4.75%(L+2.0%)                                  

Significant increases or decreases in any of the above unobservable inputs in isolation, including
unobservable inputs used in deriving bid-ask spreads, if applicable, would result in a significantly lower or higher fair value measurement for such assets and liabilities.

Quantitative information about the Companys Level 3 asset and liability fair value measurements as of December 31, 2014 is summarized in the table below:



|                                 |  |                   |  |                                |           |  |                                           |                                  |                    |                                 |                         |                                        
|-------------------------------- |  | ----------------- |  | ------------------------------ | --------- |  | ----------------------------------------- | -------------------------------- | ------------------ | ------------------------------- | ----------------------- | ---------------------------------------
|                                 |  | Asset orLiability |  | Fair Value atDecember 31, 2014 |           |  | Principal 
ValuationTechnique/Methodology |                                  | Unobservable Input |                                 | Range (WeightedAverage)
|Bank Debt / Senior Secured Loans |  | Asset             |  | $                              | 251,823   |  |                                           | Yield Analysis                   |                    | Market Yield                    |                         | 5.3%  10.7% (6.7%)                    
|Common Equity/Equity Interests   |  | Asset             |  | $$                             | 95634,421 |  |                                           | Enterprise ValueEnterprise Value |                    | EBITDA MultipleReturn on Equity |                         | 7.9x  10.3x (6.9x)7.1%  20.9% (11.3%)
|Credit Facility                  |  | Liability         |  | $                              | 143,200   |  |                                           | Yield Analysis                   |                    | Market Yield                    |                         | L+0.5%  L+4.75%(L+2.0%)               

Significant increases or decreases in any of the above unobservable inputs in isolation, including
unobservable inputs used in deriving bid-ask spreads, if applicable, would result in a significantly lower or higher fair value measurement for such assets and liabilities.

Note 7. Debt

Senior Secured Revolving Credit FacilityOn
August 26, 2011, the Company established SUNS SPV, LLC (SUNS SPV) which entered into the $200 million Credit Facility with Citigroup Global Markets Inc. acting as administrative agent. The Credit Facility was scheduled to mature on
August 26, 2016 and generally bore interest at a rate of LIBOR plus 2.25%. The Credit Facility can also be expanded up to $600,000 and is secured by all of



23



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



the assets held by the SUNS SPV. Under the terms of the Credit Facility, Solar Senior and the SUNS SPV, as applicable, have made certain customary representations and warranties, and are required
to comply with various covenants, including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities. The Credit Facility also includes usual and customary events of default for credit facilities
of this nature.

On November 7, 2012, the Company amended the Credit Facility. As a result of the amendment, the stated
interest rate on the Credit Facility was reduced to LIBOR plus 2.00% from LIBOR plus 2.25%, and the Credit Facility continues to have no LIBOR floor requirement. The amendment also provided us greater investment flexibility and extended the final
maturity date to November 6, 2017. On February 26, 2014, the Company utilized the Credit Facilitys delayed draw feature, expanding immediately available capital from $150,000 to $200,000, subject to borrowing base limitations.

On June 30, 2014, the Company again amended the Credit Facility. As a result of this amendment, commitments under the
Credit Facility were reduced by $25,000 to $175,000 and may be expanded up to $600,000 under its accordion feature. This amendment to the Credit Facility also added greater investment flexibility and extends the final maturity date to June 28,
2019. The stated interest rate remains LIBOR plus 2.00% with no LIBOR floor requirement.

The Company has made an irrevocable
election to apply the fair value option of accounting to the Credit Facility, in accordance with ASC 825-10. Accounting for the Credit Facility at fair value better aligns the measurement methodologies of assets and liabilities, which may mitigate
certain earnings volatility. ASC 825-10 requires entities to display the fair value of the selected assets and liabilities on the face of the Consolidated Statement of Assets and Liabilities and changes in fair value of the Credit Facility are
reported in the Consolidated Statement of Operations.

The average annualized interest cost for all borrowings for the three
months ended March 31, 2015 and the year ended December 31, 2014 was 2.21% and 2.18%, respectively. These costs are exclusive of other credit facility expenses such as unused fees and fees paid to the back-up servicer, if any. The maximum
amount borrowed on the Credit Facility during the three months ended March 31, 2015 and the year ended December 31, 2014, was $143,200 and $143,200, respectively.



24



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



Note 8. Financial Highlights and Senior Securities Table

The following is a schedule of financial highlights for the three months ended March 31, 2015 and for the year ended
December 31, 2014:



|                                                                |  |                                             |            |    |                            |   |            |    
|--------------------------------------------------------------- |  | ------------------------------------------- | ---------- | -- | -------------------------- | - | ---------- | ---
|                                                                |  | Three months endedMarch 31,2015 (unaudited) |            |    | Year endedDecember 31,2014 |  
|Per Share Data:(a)                                              |  |                                             |            |    |                            |   |            |    
|Net asset value, beginning of year                              |  | $                                           | 17.65      |    |                            | $ | 18.04      |    
|                                                                |  |                                             |            |    |                            |   |            |    
|Net investment income                                           |  |                                             | 0.34       |    |                            |   | 1.20       |    
|Net realized and unrealized gain (loss)                         |  |                                             | 0.01       |    |                            |   | (0.18      | )  
|                                                                |  |                                             |            |    |                            |   |            |    
|Net increase (decrease) in net assets resulting from operations |  |                                             | 0.35       |    |                            |   | 1.02       |    
|Issuance of common stock                                        |  |                                             |           |    |                            |   |           |    
|Distributions to stockholders:                                  |  |                                             |            |    |                            |   |            |    
|From net investment income                                      |  |                                             | (0.35      | )  |                            |   | (1.29      | )  
|From net realized gains                                         |  |                                             |           |    |                            |   |           |    
|From other sources                                              |  |                                             |           |    |                            |   | (0.12      | )**
|Anti-dilution                                                   |  |                                             |           |    |                            |   |           |    
|Offering costs and other                                        |  |                                             |           |    |                            |   |           |    
|                                                                |  |                                             |            |    |                            |   |            |    
|Net asset value, end of period                                  |  | $                                           | 17.65      |    |                            | $ | 17.65      |    
|                                                                |  |                                             |            |    |                            |   |            |    
|Per share market value, end of period                           |  | $                                           | 16.11      |    |                            | $ | 14.97      |    
|Total Return(b)                                                 |  |                                             | 10.03      | %  |                            |   | (10.47     | %) 
|Net assets, end of period                                       |  | $                                           | 203,539    |    |                            | $ | 203,519    |    
|Shares outstanding, end of period                               |  |                                             | 11,533,315 |    |                            |   | 11,533,315 |    
|                                                                |  |                                             |            |    |                            |   |            |    
|Ratios to average net assets(c):                                |  |                                             |            |    |                            |   |            |    
|Net investment income                                           |  |                                             | 1.90       | %  |                            |   | 6.69       | %  
|                                                                |  |                                             |            |    |                            |   |            |    
|Operating expenses                                              |  |                                             | 0.71       | %* |                            |   | 2.50       | %* 
|Interest and other credit facility expenses                     |  |                                             | 0.40       | %  |                            |   | 1.52       | %  
|                                                                |  |                                             |            |    |                            |   |            |    
|Total expenses                                                  |  |                                             | 1.11       | %* |                            |   | 4.02       | %* 
|                                                                |  |                                             |            |    |                            |   |            |    
|Average debt outstanding                                        |  | $                                           | 140,139    |    |                            | $ | 72,132     |    
|Portfolio turnover ratio                                        |  |                                             | 14.1       | %  |                            |   | 47.5       | %  



|(a) | Calculated using the average shares outstanding method.
|--- | -------------------------------------------------------

|(b) | Total return is based on the change in market price per share during the period and takes into account distributions, if any, reinvested in accordance with the dividend
reinvestment plan.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | Not annualized for periods less than one year.
|--- | ----------------------------------------------

|* | The ratio of operating expenses to average net assets and the ratio of total expenses to average net assets is shown net of a voluntary incentive fee waiver (see note
3).
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------

For the three months ended March 31, 2015, the ratios of operating expenses to average net assets and
total expenses to average net assets would be 0.78% and 1.19%, respectively, without the voluntary incentive fee waiver. For the year ended December 31, 2014, the ratios of operating expenses to average net assets and total expenses to average
net assets would be 2.61% and 4.13%, respectively, without the voluntary incentive fee waiver.

|** | Represents tax return of capital.
|-- | ---------------------------------



25



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



Information about our senior securities is shown in the following table as of each year
ended December 31 since the Company commenced operations, unless otherwise noted. The  indicates information which the SEC expressly does not require to be disclosed for certain types of senior securities.



|                                     |  |                             |         |  |                           |   |        |                                             |  |   |                                |  |  |  |     | 
|------------------------------------ |  | --------------------------- | ------- |  | ------------------------- | - | ------ | ------------------------------------------- |  | - | ------------------------------ |  |  |  | --- | 
|Class and Year                       |  | Total 
AmountOutstanding(1) |         |  | AssetCoveragePer 
Unit(2) |   |        | InvoluntaryLiquidatingPreferencePer Unit(3) |  |   | AverageMarket ValuePer
Unit(4) | 
|Revolving Credit Facility            |  |                             |         |  |                           |   |        |                                             |  |   |                                |  |  |  |     | 
|Fiscal 2015 (through March 31, 2015) |  | $                           | 140,900 |  |                           | $ | 2,445  |                                             |  | $ |                               |  |  |  | N/A | 
|Fiscal 2014                          |  |                             | 143,200 |  |                           |   | 2,421  |                                             |  |   |                               |  |  |  | N/A | 
|Fiscal 2013                          |  |                             | 61,400  |  |                           |   | 4,388  |                                             |  |   |                               |  |  |  | N/A | 
|Fiscal 2012                          |  |                             | 39,100  |  |                           |   | 5,453  |                                             |  |   |                               |  |  |  | N/A | 
|Fiscal 2011                          |  |                             | 8,600   |  |                           |   | 21,051 |                                             |  |   |                               |  |  |  | N/A | 



|(1) | Total amount of each class of senior securities outstanding at the end of the period presented.
|--- | -----------------------------------------------------------------------------------------------

|(2) | The asset coverage ratio for a class of senior securities representing indebtedness is calculated as our consolidated total assets, less all liabilities and
indebtedness not represented by senior securities, divided by senior securities representing indebtedness. This asset coverage ratio is multiplied by one thousand to determine the Asset Coverage Per Unit. In order to determine the specific Asset
Coverage Per Unit for each class of debt, the total Asset Coverage Per Unit was divided based on the amount outstanding at the end of the period for each. As of March 31, 2015, asset coverage was 244.5%.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | 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.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Not applicable, we do not have senior securities that are registered for public trading.
|--- | ----------------------------------------------------------------------------------------

Note 9. Gemino Healthcare Finance, LLC

Pursuant to a definitive agreement,
dated September 30, 2013, we acquired Gemino Healthcare Finance, LLC (d/b/a Gemino Senior Secured Healthcare Finance) (Gemino) from affiliates of EDG Partners, D. E. Shaw AQ-SP Series 5-01, L.L.C. and other members of Gemino. Gemino
is a commercial finance company that originates, underwrites, and manages primarily secured, asset-based loans for small and mid-sized companies operating in the healthcare industry. Our initial investment in Gemino of $32,839 was funded from our
existing Credit Facility. We have an additional $5,000 commitment to Gemino (which may be structured as debt or equity), conditional upon approval of the Gemino board of managers, among other conditions. The management team of Gemino committed to
lead Gemino and co-invested in the transaction.

Concurrent with the closing of the transaction, Gemino entered into a new,
four-year, non-recourse, $100,000 credit facility with non-affiliates, which is expandable to $150,000 under its accordion feature. Effective March 31, 2014, the credit facility was expanded to $105,000 and again on June 27, 2014 to
$110,000.

On December 31, 2013, we contributed our 32,839 units in Gemino to Gemino Senior Secured Healthcare LLC
(Gemino Senior Secured Healthcare). In exchange for this contribution, we received 19,839 units of equity interests and $13,000 in floating rate secured notes of Gemino Senior Secured Healthcare bearing interest at LIBOR plus 7.50%,
maturing on December 31, 2018. However, our financial statements, including our schedule of investments, reflect our investments in Gemino Senior Secured Healthcare on a consolidated basis. Geminos management team currently owns
approximately 5% of the equity in Gemino. Gemino Senior Secured Healthcare owns approximately 95% of the equity in Gemino and Solar Senior owns 100% of the equity in Gemino Senior Secured Healthcare. Gemino and Gemino Senior Secured Healthcare are
treated as pass-through entities for tax purposes.



26



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



Gemino currently manages a highly diverse portfolio of directly-originated and
underwritten senior-secured commitments. As of March 31, 2015, the portfolio totaled approximately $189,569 of commitments, of which $119,588 were funded, on total assets of $124,206. As of December 31, 2014, the portfolio totaled
approximately $204,926 of commitments, of which $122,909 were funded, on total assets of $129,024. At March 31, 2015, the portfolio consisted of 36 issuers with an average balance of approximately $3,322 versus 38 issuers with an average
balance of approximately $3,234 at December 31, 2014. All of the commitments in Geminos portfolio are floating-rate, senior-secured, cash-pay loans. Geminos credit facility, which is non-recourse to us, had approximately $90,000 and
$95,000 of borrowings outstanding at March 31, 2015 and December 31, 2014, respectively. For the three months ended March 31, 2015 and 2014, Gemino had net income of $1,155 and $908, respectively, on gross income of $3,298 and $2,922,
respectively. Due to timing and non-cash items, there may be material differences between GAAP net income and cash available for distributions.

Note 10. Commitments and Contingencies

The Company had unfunded debt and equity commitments to various revolving and delayed draw loans, as well as to Gemino. The total amount of these unfunded commitments as of March 31, 2015 and
December 31, 2014 is $6,736 and $6,736, respectively, comprised of the following:



|                                      |  |               |       |  |                  |   |       | 
|------------------------------------- |  | ------------- | ----- |  | ---------------- | - | ----- | 
|                                      |  | March 31,2015 |       |  | December 31,2014 |  
|Gemino Healthcare Finance, LLC*       |  | $             | 5,000 |  |                  | $ | 5,000 | 
|Engineering Solutions & Products, LLC |  |               | 1,736 |  |                  |   | 1,736 | 
|                                      |  |               |       |  |                  |   |       | 
|Total Commitments                     |  | $             | 6,736 |  |                  | $ | 6,736 | 
|                                      |  |               |       |  |                  |   |       | 



|* | The Company controls the funding of this commitment and may cancel it at its discretion.
|- | ----------------------------------------------------------------------------------------

As of March 31, 2015 and December 31, 2014, the Company had sufficient cash available and/or liquid securities available to
fund these commitments.

Note 11. First Lien Loan Program LLC

On September 10, 2014, the Company entered into a limited liability company agreement to create a First Lien Loan Program (FLLP) with Voya Investment Management LLC (Voya).
Voya acts as the investment advisor for several wholly-owned insurance subsidiaries of Voya Financial, Inc. (NYSE: VOYA). The joint venture vehicle, structured as an unconsolidated Delaware limited liability company, is expected to invest primarily
in senior secured floating rate term loans to middle market companies predominantly owned by private equity sponsors or entrepreneurs. Solar Senior and Voya have committed to provide $50,000 and $7,250, respectively, of capital to the joint venture.
All portfolio decisions and generally all other decisions in respect of the FLLP must be approved by an investment committee of the FLLP consisting of representatives of the Company and Voya (with approval from a representative of each required). On
February 13, 2015, FLLP commenced operations. On February 13, 2015, FLLP as transferor and FLLP 2015-1, LLC, a newly formed wholly owned subsidiary of FLLP, as borrower entered into a $75,000 senior secured revolving credit facility (the
FLLP Facility) with Wells Fargo Securities, LLC acting as administrative agent. Solar Senior Capital Ltd. acts as servicer under the FLLP Facility. The FLLP Facility is scheduled to mature on February 13, 2020. The
FLLP Facility generally bears interest at a rate of LIBOR plus a range of 2.25%-2.50%. FLLP and FLLP 2015-1, LLC, as applicable, have made certain customary representations and warranties, and are required to comply with various covenants,
including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities. The FLLP Facility also includes usual and customary events of default for credit facilities



27



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



of this nature. There were no borrowings outstanding as of March 31, 2015. As of March 31, 2015 and December 31, 2014, Solar Senior and Voya contributed combined equity capital in
the amount of $33,810 and $0, respectively. Of the $33,810 of contributed equity capital, the Company contributed $29,584 in the form of investments. The remaining $4,226 of contributed equity capital was in the form of cash. As of March 31,
2015, Solar Senior and Voyas remaining commitments totaled $20,416 and $3,024, respectively.

As of March 31, 2015
and December 31, 2014, FLLP had total assets of $32,775 and $0, respectively. For the same periods, FLLPs portfolio consisted of first lien floating rate senior secured loans to 8 and 0 different borrowers, respectively. For the period
ended March 31, 2015, FLLP invested $32,049 across 8 portfolio companies. Investments sold or prepaid totaled $83 during the same period. At March 31, 2015, the weighted average yield of FLLPs portfolio was 6.0%, measured at fair
value.

FLLP Portfolio as of March 31, 2015



|                                                          |  |                                     |  |                 |      |   |              |  |          |           |  |   |       |  |  |              |        |  |  |   |        | 
|--------------------------------------------------------- |  | ----------------------------------- |  | --------------- | ---- | - | ------------ |  | -------- | --------- |  | - | ----- |  |  | ------------ | ------ |  |  | - | ------ | 
|Description                                               |  | Industry                            |  | InterestRate(1) |      |   | MaturityDate |  |          | ParAmount |  |   | Cost  |  |  | FairValue(2) |       
|Athletico Management, LLC andAccelerated Holdings, LLC(3) |  | Health Care Facilities              |  |                 | 6.25 | % |              |  | 12/02/20 |           |  | $ | 4,988 |  |  | $            | 4,938  |  |  | $ | 4,988  | 
|Capstone LogisticsAcquisition, Inc.(3)                    |  | Professional Services               |  |                 | 5.50 | % |              |  | 10/07/21 |           |  |   | 4,489 |  |  |              | 4,444  |  |  |   | 4,444  | 
|Castle Management Borrower LLC (Highgate Hotels)(3)       |  | Real Estate Management &Development |  |                 | 5.50 | % |              |  | 09/18/20 |           |  |   | 3,980 |  |  |              | 3,941  |  |  |   | 3,980  | 
|Innovative Xcessories &Services, LLC(3)                   |  | Automotive Retail                   |  |                 | 5.25 | % |              |  | 02/21/20 |           |  |   | 2,500 |  |  |              | 2,500  |  |  |   | 2,500  | 
|Kellermeyer Bergensons Services, LLC (KBS)(3)             |  | Commercial Services &Supplies       |  |                 | 6.00 | % |              |  | 10/29/21 |           |  |   | 2,494 |  |  |              | 2,469  |  |  |   | 2,494  | 
|Metamorph US 3, LLC (Metalogix)(3)                        |  | Software                            |  |                 | 6.50 | % |              |  | 12/01/20 |           |  |   | 4,969 |  |  |              | 4,846  |  |  |   | 4,869  | 
|Pearl Merger Sub, LLC (PetVet)(3)                         |  | Health Care Facilities              |  |                 | 5.50 | % |              |  | 12/17/20 |           |  |   | 5,486 |  |  |              | 5,378  |  |  |   | 5,377  | 
|QBS Holding Company, Inc. (Quorum)(3)                     |  | Software                            |  |                 | 5.75 | % |              |  | 08/07/21 |           |  |   | 3,491 |  |  |              | 3,457  |  |  |   | 3,420  | 
|                                                          |  |                                     |  |                 |      |   |              |  |          |           |  |   |       |  |  |              |        |  |  |   |        | 
|                                                          |  |                                     |  |                 |      |   |              |  |          |           |  |   |       |  |  | $            | 31,973 |  |  | $ | 32,072 | 
|                                                          |  |                                     |  |                 |      |   |              |  |          |           |  |   |       |  |  |              |        |  |  |   |        | 



|(1) | Floating rate debt investments typically bear interest at a rate determined by reference to either the London Interbank Offered Rate (LIBOR or
L) index rate or the prime index rate (PRIME or P), and which typically reset monthly, quarterly or semi-annually. For each debt investment we have provided the current interest rate in effect as of March 31, 2015.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Represents the fair value in accordance with ASC Topic 820. The determination of such fair value is not included in the Boards valuation process described
elsewhere herein.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | The Company also holds a portion of this position on its balance sheet.
|--- | -----------------------------------------------------------------------



28



---

##### Table of Contents

SOLAR SENIOR CAPITAL LTD.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (unaudited) (continued)

March 31, 2015

(in thousands, except share amounts)



Below is certain summarized financial information for FLLP as of March 31, 2015 and
for the period February 13, 2015 (commencement of operations) through March 31, 2015:



|                                      |  |                      |        | 
|------------------------------------- |  | -------------------- | ------ | 
|                                      |  | As of March 31, 2015 |       
|Selected Balance Sheet Information:   |  |                      |        | 
|Investments, at fair value            |  | $                    | 32,072 | 
|Cash and other assets                 |  |                      | 703    | 
|                                      |  |                      |        | 
|Total assets                          |  | $                    | 32,775 | 
|                                      |  |                      |        | 
|Debt outstanding                      |  | $                    |       | 
|Distributions payable                 |  |                      | 121    | 
|Accrued expenses                      |  |                      | 61     | 
|                                      |  |                      |        | 
|Total liabilities                     |  | $                    | 182    | 
|                                      |  |                      |        | 
|Members equity                       |  | $                    | 32,593 | 
|                                      |  |                      |        | 
|Total liabilities and members equity |  | $                    | 32,775 | 
|                                      |  |                      |        | 



|                                              |  |                                                                                  |        |  
|--------------------------------------------- |  | -------------------------------------------------------------------------------- | ------ | -
|                                              |  | For the
PeriodFebruary 13, 2015(commencement ofoperations) throughMarch 31,
2015 |       
|Selected Statement of Operations Information: |  |                                                                                  |        |  
|Interest Income                               |  | $                                                                                | 184    |  
|                                              |  |                                                                                  |        |  
|Service fees                                  |  | $                                                                                | 2      |  
|Interest and other credit facility expenses*  |  |                                                                                  | 1,366  |  
|Other general and administrative expenses     |  |                                                                                  | 11     |  
|                                              |  |                                                                                  |        |  
|Total expenses                                |  |                                                                                  | 1,379  |  
|                                              |  |                                                                                  |        |  
|Net investment income (loss)                  |  | $                                                                                | (1,195 | )
|                                              |  |                                                                                  |        |  
|Net change in unrealized gain on investments  |  |                                                                                  | 99     |  
|                                              |  |                                                                                  |        |  
|Net income (loss)                             |  | $                                                                                | (1,096 | )
|                                              |  |                                                                                  |        |  



|* | FLLP made an irrevocable election to apply the fair value option of accounting to the FLLP Facility, in accordance with ASC 825-10. As such, all expenses related to the
establishment of the FLLP Facility were expensed in the current period. This amount totaled $1,316.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Note 12. Subsequent
Events

The Company has evaluated the need for disclosures and/or adjustments resulting from subsequent events through the
date the consolidated financial statements were issued.

On April 9, 2015, the Board declared a monthly distribution of
$0.1175 per share payable on May 1, 2015 to holders of record as of April 23, 2015.

On May 5, 2015, the Board
declared a monthly distribution of $0.1175 per share payable on June 2, 2015 to holders of record as of May 21, 2015.



29



---

##### Table of Contents

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders

Solar Senior Capital Ltd.:

We have reviewed the accompanying consolidated
statement of assets and liabilities, including the consolidated schedule of investments, of Solar Senior Capital Ltd. (the Company) as of March 31, 2015, the related consolidated statements of operations for the three-month periods ended
March 31, 2015 and 2014, the consolidated statement of changes in net assets for the three-month period ended March 31, 2015, and the related consolidated statements of cash flows for the three-month periods ended March 31, 2015 and
2014. These consolidated financial statements are the responsibility of the Companys management.

We conducted our
reviews in accordance with the standards of the Public Company Accounting Oversight Board (United States). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible
for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States), the objective of which is the expression of an opinion
regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our reviews, we
are not aware of any material modifications that should be made to the consolidated financial statements referred to above for them to be in conformity with U.S. generally accepted accounting principles.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the
consolidated statement of assets and liabilities, including the consolidated schedule of investments, of Solar Senior Capital Ltd., as of December 31, 2014 and the related consolidated statement of changes in net assets, and cash flows for the
year ended December 31, 2014, and in our report dated February 25, 2015, we expressed an unqualified opinion on those consolidated financial statements.

/s/ KPMG LLP

New York, New York

May 5, 2015



30



---

##### Table of Contents

|Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations
|------- | -------------------------------------------------------------------------------------

The information contained in this section should be read in conjunction with our consolidated financial statements and notes thereto
appearing elsewhere in this report.

Some of the statements in this report constitute forward-looking statements, which
relate to future events or our future performance or financial condition. The forward-looking statements contained herein involve risks and uncertainties, including statements as to:



| |  |  | our future operating results;
| | - |  | -----------------------------



| |  |  | our business prospects and the prospects of our portfolio companies;
| | - |  | --------------------------------------------------------------------



| |  |  | the impact of investments that we expect to make;
| | - |  | -------------------------------------------------



| |  |  | our contractual arrangements and relationships with third parties;
| | - |  | ------------------------------------------------------------------



| |  |  | the dependence of our future success on the general economy and its impact on the industries in which we invest;
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | the ability of our portfolio companies to achieve their objectives;
| | - |  | -------------------------------------------------------------------



| |  |  | our expected financings and investments;
| | - |  | ----------------------------------------



| |  |  | the adequacy of our cash resources and working capital; and
| | - |  | -----------------------------------------------------------



| |  |  | the timing of cash flows, if any, from the operations of our portfolio companies.
| | - |  | ---------------------------------------------------------------------------------

We generally use words such as anticipates, believes, expects, intends and similar
expressions to identify forward-looking statements. Our actual results could differ materially from those projected in the forward-looking statements for any reason, including any factors set forth in Risk Factors and elsewhere in this
report.

We have based the forward-looking statements included in this report on information available to us on the date of
this report, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you
are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the SEC, including any annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form
8-K.

Overview

Solar Senior Capital Ltd. (Solar Senior, the Company, or we), a Maryland corporation formed in
December 2010, is a closed-end, externally managed, non-diversified management investment company that has elected to be treated as a business development company (BDC) under the Investment Company Act of 1940, as amended (the 1940
Act). Furthermore, as the Company is an investment company, it continues to apply the guidance in FASB Accounting Standards Codification (ASC) Topic 946. In addition, for tax purposes, the Company has elected to be treated as a
regulated investment company (RIC) under Subchapter M of the Internal Revenue Code of 1986, as amended (the Code).

On February 24, 2011, we priced our initial public offering, selling 9.0 million shares, including the underwriters over-allotment, at a price of $20.00 per share. Concurrent with this
offering, management purchased an additional 500,000 shares through a concurrent private placement, also at $20.00 per share.

On August 26, 2011, the Company established SUNS SPV, LLC (SUNS SPV) which entered into a $200 million senior secured
revolving credit facility (the Credit Facility) with Citigroup Global Markets Inc. acting as administrative agent. The Credit Facility was scheduled to mature on August 26, 2016 and generally bore



31



---

##### Table of Contents

interest at the London Interbank Offered Rate (LIBOR) plus 2.25%. The Credit Facility had $150 million immediately available with an additional $50 million available under a delayed
draw feature. The Credit Facility can also be expanded up to $600 million and is secured by all of the assets held by the SUNS SPV. Under the terms of the Credit Facility, Solar Senior and the SUNS SPV, as applicable, have made certain customary
representations and warranties, and are required to comply with various covenants, including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities. The Credit Facility also includes usual and
customary events of default for credit facilities of this nature.

On November 7, 2012, we amended our Credit Facility.
As a result of the amendment, the stated interest rate on the Credit Facility was reduced to LIBOR plus 2.00% from LIBOR plus 2.25%, and the Credit Facility continues to have no LIBOR floor requirement. The amendment also provided us greater
investment flexibility and extended the final maturity date to November 6, 2017.

On June 30, 2014, the Company
again amended the Credit Facility. As a result of this amendment, commitments under the Credit Facility were reduced by $25 million to $175 million and may be expanded up to $600 million under its accordion feature. This amendment to the Credit
Facility also added greater investment flexibility and extends the final maturity date to June 28, 2019. The stated interest rate remains LIBOR plus 2.00% with no LIBOR floor requirement.

We invest primarily in U.S. middle market companies, where we believe the supply of primary capital is limited and the investment
opportunities are most attractive. Our investment objective is to seek to maximize current income consistent with the preservation of capital. We seek to achieve our investment objective by directly and indirectly investing primarily in senior
loans, including first lien and second lien debt instruments, made to private middle-market companies whose debt is rated below investment grade, which we refer to collectively as senior loans. We may also invest in debt of public
companies that are thinly traded. Under normal market conditions, at least 80% of the value of our net assets (including the amount of any borrowings for investment purposes) will be invested in senior loans. Senior loans typically pay interest at
rates which are determined periodically on the basis of a floating base lending rate, primarily LIBOR, plus a premium. Senior loans in which we expect to invest are typically made to U.S. and, to a limited extent, non-U.S. corporations, partnerships
and other business entities which operate in various industries and geographical regions. Senior loans typically are rated below investment grade. Securities rated below investment grade are often referred to as leveraged loans or
high yield securities, and may be considered high risk compared to debt instruments that are rated investment grade.

We expect to invest in senior loans made primarily to private, leveraged middle-market companies with approximately $20 million to $100 million of earnings before income taxes, depreciation and
amortization (EBITDA). Our business model is focused primarily on the direct origination of investments through portfolio companies or their financial sponsors. We expect that our direct investments will generally range between $5
million and $30 million each, although we expect that this investment size will vary proportionately with the size of our capital base and/or with strategic initiatives. In addition, we may invest a portion of our portfolio in other types of
investments, which we refer to as opportunistic investments, which are not our primary focus but are intended to enhance our overall returns. These opportunistic investments may include, but are not limited to, direct investments in public companies
that are not thinly traded and securities of leveraged companies located in select countries outside of the United States. We may invest up to 30% of our total assets in such opportunistic investments, including senior loans issued by non-U.S.
issuers, subject to compliance with our regulatory obligations as a BDC under the 1940 Act.

As of March 31, 2015, our
adviser, Solar Capital Partners, LLC (the Investment Adviser), has invested approximately $4.7 billion in more than 190 different portfolio companies since it was founded in 2006. Over the same period, the Investment Adviser completed
transactions with more than 120 different financial sponsors.



32



---

##### Table of Contents

Recent Developments

On April 9, 2015, the Board declared a monthly distribution of $0.1175 per share payable on May 1, 2015 to holders of record as of April 23, 2015.

On May 5, 2015, the Board declared a monthly distribution of $0.1175 per share payable on June 2, 2015 to holders of record as
of May 21, 2015.

Investments

Our level of investment activity can and does vary substantially from period to period depending on many factors, including the amount of debt and equity capital available to middle market companies, the
level of merger and acquisition activity for such companies, the general economic environment and the competitive environment for the types of investments we make. As a BDC, we must not acquire any assets other than qualifying assets
specified in the 1940 Act unless, at the time the acquisition is made, at least 70% of our total assets are qualifying assets (with certain limited exceptions). Qualifying assets include investments in eligible portfolio companies. The
definition of eligible portfolio company includes certain public companies that do not have any securities listed on a national securities exchange and companies whose securities are listed on a national securities exchange but whose
market capitalization is less than $250 million.

Revenue

We generate revenue primarily in the form of interest and dividend income from the securities we hold and capital gains, if any, on
investment securities that we may sell. Our debt investments generally have a stated term of three to seven years and typically bear interest at a floating rate usually determined on the basis of a benchmark London interbank offered rate
(LIBOR), commercial paper rate, or the prime rate. Interest on our debt investments is generally payable quarterly but may be monthly or semi-annually. In addition, our investments may provide payment-in-kind (PIK) interest.
Such amounts of accrued PIK interest are added to the cost of the investment on the respective capitalization dates and generally become due at maturity of the investment or upon the investment being called by the issuer. We may also generate
revenue in the form of commitment, origination, structuring fees, fees for providing managerial assistance and, if applicable, consulting fees, etc.

Expenses

All investment professionals of the Investment Adviser and
its staff, when and to the extent engaged in providing investment advisory and management services to us, and the compensation and routine overhead expenses of that personnel which is allocable to those services are provided and paid for by the
Investment Adviser. We bear all other costs and expenses of our operations and transactions, including those relating to:



| |  |  | investment advisory and management fees;
| | - |  | ----------------------------------------



| |  |  | expenses incurred by the Investment Adviser payable to third parties, including agents, consultants or other advisors, in monitoring our financial and
legal affairs and in monitoring our investments and performing due diligence on our prospective portfolio companies;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | calculation of our net asset value (including the cost and expenses of any independent valuation firm utilized);
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | direct costs and expenses of administration, including independent registered public accounting and legal costs;
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | costs of preparing and filing reports or other documents with the SEC;
| | - |  | ----------------------------------------------------------------------



| |  |  | interest payable on debt, if any, incurred to finance our investments;
| | - |  | ----------------------------------------------------------------------



| |  |  | offerings of our common stock and other securities;
| | - |  | ---------------------------------------------------



33



---

##### Table of Contents

| |  |  | registration and listing fees;
| | - |  | ------------------------------



| |  |  | fees payable to third parties, including agents, consultants or other advisors, relating to, or associated with, evaluating and making investments;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | transfer agent and custodial fees;
| | - |  | ----------------------------------



| |  |  | taxes;
| | - |  | ------



| |  |  | independent directors fees and expenses;
| | - |  | -----------------------------------------



| |  |  | marketing and distribution-related expenses;
| | - |  | --------------------------------------------



| |  |  | the costs of any reports, proxy statements or other notices to stockholders, including printing and postage costs;
| | - |  | ------------------------------------------------------------------------------------------------------------------



| |  |  | our allocable portion of the fidelity bond, directors and officers/errors and omissions liability insurance, and any other insurance premiums;
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | organizational costs; and
| | - |  | -------------------------



| |  |  | all other expenses incurred by us or the Administrator in connection with administering our business, such as our allocable portion of overhead under
the administration agreement, including rent and our allocable portion of the cost of our chief financial officer and chief compliance officer and their respective staffs.
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We expect our general and administrative operating expenses related to our ongoing operations to increase moderately in dollar terms.
During periods of asset growth, we generally expect our general and administrative operating expenses to decline as a percentage of our total assets and increase during periods of asset declines. Incentive fees, interest expense and costs relating
to future offerings of securities, among others, may also increase or reduce overall operating expenses based on portfolio performance, interest rate benchmarks, and offerings of our securities relative to comparative periods, among other factors.

Portfolio and Investment Activity

During the three months ended March 31, 2015, we invested $24.6 million across 5 portfolio companies. This compares to investing $49.7 million in 9 portfolio companies for the three months ended
March 31, 2014. Investment sales and prepayments during the three months ended March 31, 2015 totaled $20.2 million versus $43.5 million for the three months ended March 31, 2014.

At March 31, 2015, our portfolio consisted of 46 portfolio companies and was invested 80.2% in senior secured loans, 1.1% in
unsecured loans and 18.7% in common equity/equity interests measured at fair value versus 37 portfolio companies invested 85.7% in senior secured loans, 1.4% in unsecured loans and 12.9% in common equity/equity interests at March 31, 2014.

The weighted average yields on our income producing portfolio of investments were 6.9% and 7.7%, respectively, at
March 31, 2015 and 2014 measured at fair value.

At March 31, 2015, 94.5% or $325.7 million of our income producing
investment portfolio* is floating rate and 5.5% or $18.9 million is fixed rate, measured at fair value. At March 31, 2014, 93.0% or $254.5 million of our income producing investment portfolio* is floating rate and 7.0% or $19.0 million is fixed
rate, measured at fair value.

Since the initial public offering of Solar Senior on February 24, 2011 and through
March 31, 2015, invested capital totaled approximately $851 million in 87 portfolio companies. Over the same period, Solar Senior completed transactions with more than 55 different financial sponsors.



|* | We have included First Lien Loan Program LLC and Gemino Healthcare Finance, LLC as 100% floating rate within our income producing investment portfolio.
|- | -------------------------------------------------------------------------------------------------------------------------------------------------------



34



---

##### Table of Contents

Gemino Healthcare Finance, LLC

Pursuant to a definitive agreement, dated September 30, 2013, we acquired Gemino Healthcare Finance, LLC (d/b/a Gemino Senior Secured
Healthcare Finance) (Gemino) from affiliates of EDG Partners, D. E. Shaw AQ-SP Series 5-01, L.L.C. and other members of Gemino. Gemino is a commercial finance company that originates, underwrites, and manages primarily secured,
asset-based loans for small and mid-sized companies operating in the healthcare industry. Our initial investment in Gemino of $32.8 million was funded from our existing Credit Facility. We have an additional $5.0 million commitment to Gemino (which
may be structured as debt or equity), conditional upon approval of the Gemino board of managers, among other conditions. The management team of Gemino committed to lead Gemino and co-invested in the transaction.

Concurrent with the closing of the transaction, Gemino entered into a new, four-year, non-recourse, $100.0 million credit facility with
non-affiliates, which is expandable to $150.0 million under its accordion feature. Effective March 31, 2014, the credit facility was expanded to $105.0 million and again on June 27, 2014 to $110.0 million.

On December 31, 2013, we contributed our 32,839 units in Gemino to Gemino Senior Secured Healthcare LLC (Gemino Senior Secured
Healthcare). In exchange for this contribution, we received 19,839 units of equity interests and $13.0 million in floating rate secured notes of Gemino Senior Secured Healthcare bearing interest at LIBOR plus 7.50%, maturing on
December 31, 2018. However, our financial statements, including our schedule of investments, reflect our investments in Gemino Senior Secured Healthcare on a consolidated basis. Geminos management team currently owns approximately 5% of
the equity in Gemino. Gemino Senior Secured Healthcare owns approximately 95% of the equity in Gemino and Solar Senior owns 100% of the equity in Gemino Senior Secured Healthcare. Gemino and Gemino Senior Secured Healthcare are treated as
pass-through entities for tax purposes.

Gemino currently manages a highly diverse portfolio of directly-originated and
underwritten senior-secured commitments. As of March 31, 2015, the portfolio totaled approximately $189.6 million of commitments, of which $119.6 million were funded, on total assets of $124.2 million. As of December 31, 2014, the
portfolio totaled approximately $204.9 million of commitments, of which $122.9 million were funded, on total assets of $129.0 million. At March 31, 2015, the portfolio consisted of 36 issuers with an average balance of approximately $3.3
million versus 38 issuers with an average balance of approximately $3.2 million at December 31, 2014. All of the commitments in Geminos portfolio are floating-rate, senior-secured, cash-pay loans. Geminos credit facility, which is
non-recourse to us, had approximately $90.0 million and $95.0 million of borrowings outstanding at March 31, 2015 and December 31, 2014, respectively. For the three months ended March 31, 2015 and 2014, Gemino had net income of $1.2
million and $0.9 million, respectively, on gross income of $3.3 million and $2.9 million, respectively. Due to timing and non-cash items, there may be material differences between GAAP net income and cash available for distributions.

First Lien Loan Program LLC

On September 10, 2014, the Company entered into a limited liability company agreement to create a First Lien Loan Program (FLLP) with Voya Investment Management LLC (Voya).
Voya acts as the investment advisor for several wholly-owned insurance subsidiaries of Voya Financial, Inc. (NYSE: VOYA). The joint venture vehicle, structured as an unconsolidated Delaware limited liability company, is expected to invest primarily
in senior secured floating rate term loans to middle market companies predominantly owned by private equity sponsors or entrepreneurs. Solar Senior and Voya have committed to provide $50.0 million and $7.25 million, respectively, of capital to the
joint venture. All portfolio decisions and generally all other decisions in respect of the FLLP must be approved by an investment committee of the FLLP consisting of representatives of the Company and Voya (with approval from a representative of
each required). On February 13, 2015, FLLP commenced operations. On February 13, 2015, FLLP as transferor and FLLP 2015-1, LLC, a newly formed wholly owned subsidiary of FLLP, as borrower entered into a $75 million senior secured revolving
credit facility



35



---

##### Table of Contents

(the FLLP Facility) with Wells Fargo Securities, LLC acting as administrative agent. Solar Senior Capital Ltd. acts as servicer under the FLLP Facility. The FLLP Facility is
scheduled to mature on February 13, 2020. The FLLP Facility generally bears interest at a rate of LIBOR plus a range of 2.25%-2.50%. FLLP and FLLP 2015-1, LLC, as applicable, have made certain customary representations and warranties,
and are required to comply with various covenants, including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities. The FLLP Facility also includes usual and customary events of default for
credit facilities of this nature. There were no borrowings outstanding as of March 31, 2015. As of March 31, 2015 and December 31, 2014, Solar Senior and Voya contributed combined equity capital in the amount of $33.8 million and $0,
respectively. Of the $33.8 million of contributed equity capital, the Company contributed $29.6 million in the form of investments. The remaining $4.2 million of contributed equity capital was in the form of cash. As of March 31,
2015, Solar Senior and Voyas remaining commitments totaled $20.4 million and $3.0 million, respectively.

As
of March 31, 2015 and December 31, 2014, FLLP had total assets of $32.8 million and $0, respectively. For the same periods, FLLPs portfolio consisted of first lien floating rate senior secured loans to 8 and 0 different borrowers,
respectively. For the period ended March 31, 2015, FLLP invested $32.0 million across 8 portfolio companies. Investments sold or prepaid totaled $0.1 million during the same period. At March 31, 2015, the weighted average yield of
FLLPs portfolio was 6.0%, measured at fair value.

FLLP Portfolio as of March 31, 2015 (in thousands)



|                                                                                         |  |                                      |  |                 |      |   |              |  |          |           |  |   |       |  |  |              |        |  |  |   |        | 
|---------------------------------------------------------------------------------------- |  | ------------------------------------ |  | --------------- | ---- | - | ------------ |  | -------- | --------- |  | - | ----- |  |  | ------------ | ------ |  |  | - | ------ | 
|Description                                                                              |  | Industry                             |  | InterestRate(1) |      |   | MaturityDate |  |          | ParAmount |  |   | Cost  |  |  | FairValue(2) |       
|Athletico Management, LLC and Athletico Management, LLC and Accelerated Holdings, LLC(3) |  | Health Care Facilities               |  |                 | 6.25 | % |              |  | 12/02/20 |           |  | $ | 4,988 |  |  | $            | 4,938  |  |  | $ | 4,988  | 
|Capstone Logistics Acquisition, Inc.(3)                                                  |  | Professional Services                |  |                 | 5.50 | % |              |  | 10/07/21 |           |  |   | 4,489 |  |  |              | 4,444  |  |  |   | 4,444  | 
|Castle Management Borrower LLC (Highgate Hotels)(3)                                      |  | Real Estate Management & Development |  |                 | 5.50 | % |              |  | 09/18/20 |           |  |   | 3,980 |  |  |              | 3,941  |  |  |   | 3,980  | 
|Innovative Xcessories & Services, LLC(3)                                                 |  | Automotive Retail                    |  |                 | 5.25 | % |              |  | 02/21/20 |           |  |   | 2,500 |  |  |              | 2,500  |  |  |   | 2,500  | 
|Kellermeyer Bergensons Services, LLC (KBS)(3)                                            |  | Commercial Services & Supplies       |  |                 | 6.00 | % |              |  | 10/29/21 |           |  |   | 2,494 |  |  |              | 2,469  |  |  |   | 2,494  | 
|Metamorph US 3, LLC (Metalogix)(3)                                                       |  | Software                             |  |                 | 6.50 | % |              |  | 12/01/20 |           |  |   | 4,969 |  |  |              | 4,846  |  |  |   | 4,869  | 
|Pearl Merger Sub, LLC (PetVet)(3)                                                        |  | Health Care Facilities               |  |                 | 5.50 | % |              |  | 12/17/20 |           |  |   | 5,486 |  |  |              | 5,378  |  |  |   | 5,377  | 
|QBS Holding Company, Inc. (Quorum)(3)                                                    |  | Software                             |  |                 | 5.75 | % |              |  | 08/07/21 |           |  |   | 3,491 |  |  |              | 3,457  |  |  |   | 3,420  | 
|                                                                                         |  |                                      |  |                 |      |   |              |  |          |           |  |   |       |  |  |              |        |  |  |   |        | 
|                                                                                         |  |                                      |  |                 |      |   |              |  |          |           |  |   |       |  |  | $            | 31,973 |  |  | $ | 32,072 | 
|                                                                                         |  |                                      |  |                 |      |   |              |  |          |           |  |   |       |  |  |              |        |  |  |   |        | 



|(1) | Floating rate debt investments typically bear interest at a rate determined by reference to either the London Interbank Offered Rate (LIBOR or
L) index rate or the prime index rate (PRIME or P), and which typically reset monthly, quarterly or semi-annually. For each debt investment we have provided the current interest rate in effect as of March 31, 2015.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Represents the fair value in accordance with ASC Topic 820. The determination of such fair value is not included in the Boards valuation process described
elsewhere herein.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | The Company also holds a portion of this position on its balance sheet.
|--- | -----------------------------------------------------------------------



36



---

##### Table of Contents

Below is certain summarized financial information for FLLP as of March 31, 2015 and for
the period February 13, 2015 (commencement of operations) through March 31, 2015:



|                                                   |  |                      |        | 
|-------------------------------------------------- |  | -------------------- | ------ | 
|Selected Balance Sheet Information (in thousands): |  | As of March 31, 2015 |       
|Investments, at fair value                         |  | $                    | 32,072 | 
|Cash and other assets                              |  |                      | 703    | 
|                                                   |  |                      |        | 
|Total assets                                       |  | $                    | 32,775 | 
|                                                   |  |                      |        | 
|Debt outstanding                                   |  | $                    |       | 
|Distributions payable                              |  |                      | 121    | 
|Accrued expenses                                   |  |                      | 61     | 
|                                                   |  |                      |        | 
|Total liabilities                                  |  | $                    | 182    | 
|                                                   |  |                      |        | 
|Members equity                                    |  | $                    | 32,593 | 
|                                                   |  |                      |        | 
|Total liabilities and members equity              |  | $                    | 32,775 | 
|                                                   |  |                      |        | 



|                                                             |  |                                                                                  |        |  
|------------------------------------------------------------ |  | -------------------------------------------------------------------------------- | ------ | -
|Selected Statement of Operations Information (in thousands): |  | For the
PeriodFebruary 13, 2015(commencement ofoperations) throughMarch 31,
2015 |       
|Interest Income                                              |  | $                                                                                | 184    |  
|                                                             |  |                                                                                  |        |  
|Service fees                                                 |  | $                                                                                | 2      |  
|Interest and other credit facility expenses*                 |  |                                                                                  | 1,366  |  
|Other general and administrative expenses                    |  |                                                                                  | 11     |  
|                                                             |  |                                                                                  |        |  
|Total expenses                                               |  |                                                                                  | 1,379  |  
|                                                             |  |                                                                                  |        |  
|Net investment income (loss)                                 |  | $                                                                                | (1,195 | )
|                                                             |  |                                                                                  |        |  
|Net change in unrealized gain on investments                 |  |                                                                                  | 99     |  
|                                                             |  |                                                                                  |        |  
|Net income (loss)                                            |  | $                                                                                | (1,096 | )
|                                                             |  |                                                                                  |        |  



|* | FLLP made an irrevocable election to apply the fair value option of accounting to the FLLP Facility, in accordance with ASC 825-10. As such, all expenses related to the
establishment of the FLLP Facility were expensed in the current period. This amount totaled $1,316.
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Critical Accounting
Policies

The preparation of consolidated financial statements and related disclosures in conformity with GAAP requires
management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and revenues and expenses during the
periods reported. Actual results could materially differ from those estimates. We have identified the following items as critical accounting policies. Within the context of these critical accounting policies and disclosed subsequent events herein,
we are not currently aware of any other reasonably likely events or circumstances that would result in materially different amounts being reported.

Valuation of Portfolio Investments

We conduct the valuation of our
assets, pursuant to which our net asset value is determined, at all times consistent with GAAP, and the 1940 Act. Our valuation procedures are set forth in more detail below:

The Company conducts the valuation of its assets in accordance with GAAP and the 1940 Act. The Company generally values its assets on a quarterly basis, or more frequently if required. Investments for
which



37



---

##### Table of Contents

market quotations are readily available on an exchange are valued at the closing price on the date of valuation. The Company may also obtain quotes with respect to certain of its investments from
pricing services or brokers or dealers in order to value assets. When doing so, management determines whether the quote obtained is sufficient according to GAAP to determine the fair value of the investment. If determined adequate, the Company uses
the quote obtained. Debt investments with maturities of 60 days or less shall each be valued at cost plus accreted discount, or minus amortized premium, which is expected to approximate fair value, unless such valuation, in the judgment of the
Investment Adviser, does not represent fair value, in which case such investments shall be valued at fair value as determined in good faith by or under the direction of the Companys board of directors (the Board).

Investments for which reliable market quotations are not readily available or for which the pricing sources do not provide a valuation or
methodology or provide a valuation or methodology that, in the judgment of the Investment Adviser or the Board does not represent fair value, each shall be valued as follows: (i) each portfolio company or investment is initially valued by the
investment professionals responsible for the portfolio investment; (ii) preliminary valuations are discussed with senior management of the Investment Adviser; (iii) independent valuation firms engaged by, or on behalf of, the Board will
conduct independent appraisals and review the Investment Advisers preliminary valuations and make their own independent assessment for (a) each portfolio investment that, when taken together with all other investments in the same
portfolio company, exceeds 10% of estimated total assets, plus available borrowings, as of the end of the most recently completed fiscal quarter, and (b) each portfolio investment that is presently in payment default; (iv) the Board will
discuss the valuations and determine the fair value of each investment in our portfolio in good faith based on the input of the Investment Adviser and, where appropriate, the respective independent valuation firm.

The recommendation of fair value generally considers the following factors among others, as relevant: applicable market yields; the
nature and realizable value of any collateral; the portfolio companys ability to make payments; the portfolio companys earnings and discounted cash flow; the markets in which the issuer does business; and comparisons to publicly traded
securities, among others.

When an external event such as a purchase transaction, public offering or subsequent equity sale
occurs, the Company will consider the pricing indicated by the external event to corroborate the valuation. 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 investments may differ significantly from the values that would have been used had a readily available market value existed for such investments, and the differences could be material.

Investments are valued utilizing a market approach, an income approach, or both approaches, as appropriate. The market approach uses
prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities (including a business). The income approach uses valuation techniques to convert future amounts (for example, cash flows
or earnings) to a single present amount (discounted). The measurement is based on the value indicated by current market expectations about those future amounts. In following these approaches, the types of factors that we may take into account in
fair value pricing our investments include, as relevant: available current market data, including relevant and applicable market trading and transaction comparables, applicable market yields and multiples, security covenants, call protection
provisions, the nature and realizable value of any collateral, the portfolio companys ability to make payments, its earnings and discounted cash flows, the markets in which the portfolio company does business, comparisons of financial ratios
of peer companies that are public, M&A comparables, and enterprise values, among other factors. When available, broker quotations and/or quotations provided by pricing services are considered as an input in the valuation process. For the three
months ended March 31, 2015, there has been no change to the Companys valuation techniques and the nature of the related inputs considered in the valuation process.



38



---

##### Table of Contents

Accounting Standards Codification (ASC) Topic 820 classifies the inputs used to
measure these fair values into the following hierarchy:

Level 1: Quoted prices in active markets for identical assets
or liabilities, accessible by the Company at the measurement date.

Level 2: Quoted prices for similar assets or
liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active, or other observable inputs other than quoted prices.

Level 3: Unobservable inputs for the asset or liability.

In all cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level of input that is significant to the fair value
measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to each investment. The exercise of judgment is based in part on our knowledge of
the asset class and our prior experience.

Determination of fair value involves subjective judgments and estimates.
Accordingly, the notes to our consolidated financial statements express the uncertainty with respect to the possible effect of such valuations, and any change in such valuations, on our consolidated financial statements.

Valuation of Credit Facility

The Company has made an irrevocable election to apply the fair value option of accounting to the Credit Facility, in accordance with ASC 825-10. We believe accounting for the Credit Facility at fair value
better aligns the measurement methodologies of assets and liabilities, which may mitigate certain earnings volatility.

Revenue
Recognition

The Company records dividend income and interest, adjusted for amortization of premium and accretion of
discount, on an accrual basis. Investments that are expected to pay regularly scheduled interest and/or dividends in cash are generally placed on non-accrual status when principal or interest/dividend cash payments are past due 30 days or more
and/or when it is no longer probable that principal or interest/dividend cash payments will be collected. Such non-accrual investments are restored to accrual status if past due principal and interest or dividends are paid in cash, and in
managements judgment, are likely to continue timely payment of their remaining interest or dividend obligations. Interest or dividend cash payments received on investments may be recognized as income or applied to principal depending upon
managements judgment. Some of our investments may have contractual PIK interest or dividends. PIK interest and dividends computed at the contractual rate is accrued into income and reflected as receivable up to the capitalization date. PIK
investments offer issuers the option at each payment date of making payments in cash or in additional securities. When additional securities are received, they typically have the same terms, including maturity dates and interest rates as the
original securities issued. On these payment dates, the Company capitalizes the accrued interest or dividends receivable (reflecting such amounts as the basis in the additional securities received). PIK generally becomes due at the maturity of the
investment or upon the investment being called by the issuer. At the point the Company believes PIK is not expected to be realized, the PIK investment will be placed on non-accrual status. When a PIK investment is placed on non-accrual status, the
accrued, uncapitalized interest or dividends is reversed from the related receivable through interest or dividend income, respectively. The Company does not reverse previously capitalized PIK interest or dividends. Upon capitalization, PIK is
subject to the fair value estimates associated with their related investments. PIK investments on non-accrual status are restored to accrual status if the Company again believes that PIK is expected to be realized. Loan origination fees, original
issue discount, and market discounts are capitalized and amortized into income using the interest method or straight-line, as applicable. Upon the prepayment of a loan, any unamortized loan origination fees are recorded as interest income. We record
prepayment premiums on loans and other investments as interest income when we receive such amounts. Capital structuring fees are recorded as other income when earned.

The typically higher yields and interest rates on PIK securities, to the extent we invested, reflects the payment deferral and increased credit risk associated with such instruments and that such
investments may



39



---

##### Table of Contents

represent a significantly higher credit risk than coupon loans. PIK securities may have unreliable valuations because their continuing accruals require continuing judgments about the
collectability of the deferred payments and the value of any associated collateral. PIK interest has the effect of generating investment income and increasing the incentive fees payable at a compounding rate. In addition, the deferral of PIK
interest also increases the loan-to-value ratio at a compounding rate. PIK securities create the risk that incentive fees will be paid to the Investment Adviser based on non-cash accruals that ultimately may not be realized, but the Investment
Adviser will be under no obligation to reimburse the Company for these fees. For the three months ended March 31, 2015, capitalized PIK income totaled less than $0.1 million.

Net Realized Gain or Loss and Net Change in Unrealized Gain or Loss

We generally measure realized gain or loss by the difference between the net proceeds from the repayment or sale and the amortized cost
basis of the investment, without regard to unrealized appreciation or depreciation previously recognized, but considering unamortized origination or commitment fees and prepayment penalties. The net change in unrealized gain or loss reflects the
change in portfolio investment values during the reporting period, including the reversal of previously recorded unrealized gain or loss, when gains or losses are realized.

Income Taxes

Solar Senior Capital, a U.S. corporation, has elected to be
treated as a RIC under Subchapter M of the Code, as amended. In order to qualify as a RIC, among other things, the Company is required to timely distribute to its stockholders at least 90% of investment company taxable income, as defined by the
Code, for each year. Depending on the level of taxable income earned in a given tax year, we may choose to carry forward taxable income in excess of current year distributions into the next tax year and pay a 4% excise tax on such income, as
required. To the extent that the Company determines that its estimated current year annual taxable income will be in excess of estimated current year distributions, the Company accrues an estimated excise tax, if any, on estimated excess taxable
income. As of March 31, 2015, the accrual for excise tax was $0.

Recent Accounting Pronouncements

In February 2015, the Financial Accounting Standards Board issued Accounting Standards Update 2015-02, Consolidation (Topic
810)Amendments to the Consolidation Analysis. The update changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. Public companies are required to apply ASU 2015-02
for interim and annual reporting periods beginning after December 15, 2015. Accordingly, the Company is currently evaluating the impact of the adoption of ASU 2015-02 on its consolidated financial
statements and disclosures.

In April 2015, the Financial Accounting Standards Board issued Accounting Standards Update
2015-03, InterestImputation of Interest (Subtopic 835-30)Simplifying the Presentation of Debt Issuance Costs. The update requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a
direct deduction from the carrying amount of that debt liability, consistent with debt discounts. Public companies are required to apply ASU 201503 retrospectively for interim and annual reporting periods beginning after December 15,
2015. Accordingly, the Company is currently evaluating the impact of the adoption of ASU 2015-03 on its consolidated financial statements and disclosures.

RESULTS OF OPERATIONS

Results comparisons are for the three months ended
March 31, 2015 and March 31, 2014:

Investment Income

For the three months ended March 31, 2015 and 2014, gross investment income totaled $6.1 million and $5.7 million, respectively. The
increase in gross investment income year over year was primarily due to net portfolio growth.



40



---

##### Table of Contents

Expenses

Net expenses totaled $2.3 million and $1.9 million, respectively, for the three months ended March 31, 2015 and 2014, of which $0.9 million and $0.9 million, respectively, were management and net
performance-based incentive fees and $0.8 million and $0.4 million, respectively, were interest and other credit facility expenses. Administrative services and other general and administrative expenses totaled $0.6 million and $0.5 million,
respectively, for the three months ended March 31, 2015 and 2014. Expenses generally consist of management fees, performance-based incentive fees, administrative services expenses, insurance, legal expenses, directors expenses, audit and
tax expenses, transfer agent fees and expenses, and other general and administrative expenses. Interest and other credit facility expenses generally consist of interest, unused fees, agency fees and loan origination fees, if any, among others. The
increase in total expenses for the three months ended March 31, 2015 as compared to the year ago period was primarily due to increased interest expense on higher average borrowings and higher management fees on a comparatively larger portfolio.

Net Investment Income

The Companys net investment income totaled $3.9 million and $3.9 million, or $0.34 and $0.33, per average share, respectively, for the three months ended March 31, 2015 and 2014.

Net Realized Gain (Loss)

The Company had investment sales and prepayments totaling approximately $49.8 million and $22.5 million, respectively, for the three
months ended March 31, 2015 and 2014. Net realized gains (losses) over the same periods were $0.0 million and ($0.8) million, respectively. Net realized gains for the three months ended March 31, 2015 were primarily related to the sale of
certain investments. Net realized losses for the three months ended March 31, 2014 were primarily related to the sale of our investment in SLT Environmental, Inc.

Net Change in Unrealized Gain

For the three months ended March 31,
2015 and 2014, net change in unrealized gain on the Companys assets and liabilities totaled $0.2 million and $0.9 million, respectively. Net unrealized gain for the three months ended March 31, 2015 is primarily due to appreciation in the
value of our investments in Gemino Healthcare Finance LLC, IPC Systems, Inc. and Blue Coat Systems, Inc., among others, partially offset by depreciation in First Lien Loan Program LLC and Engineering Solutions & Products, LLC., among
others. Net unrealized gain for the three months ended March 31, 2014 was primarily due to the reversal of unrealized depreciation on our investment in SLT Environmental, Inc.

Net Increase in Net Assets From Operations

For the three months ended
March 31, 2015 and 2014, the Company had a net increase in net assets resulting from operations of $4.1 million and $4.0 million, respectively. For the same periods, earnings per average share were $0.35 and $0.35, respectively.

LIQUIDITY AND CAPITAL RESOURCES

The Companys liquidity and capital resources are generally available through its Credit Facility, through periodic follow-on equity offerings, as well as from cash flows from operations, investment
sales and pre-payments of investments. At March 31, 2015, the Company had $140.9 million in borrowings outstanding on its Credit Facility and $34.1 million of unused capacity, subject to borrowing base limits.

On January 18, 2013, the Company closed a follow-on public equity offering of 2.0 million shares of common stock at $18.85 per
share raising approximately $37.2 million in net proceeds. In the future, the Company may raise additional equity or debt capital, among other considerations. The primary uses of funds will



41



---

##### Table of Contents

be investments in portfolio companies, reductions in debt outstanding and other general corporate purposes. The issuance of debt or equity securities will depend on future market conditions,
funding needs and other factors and there can be no assurance that any such issuance will occur or be successful.

We
currently expect that our liquidity needs will be met with cash flows from operations, borrowings under our Credit Facility, including its accordion feature, as well as from other available financing activities.

Cash Equivalents

We
deem certain U.S. Treasury bills, repurchase agreements and other high-quality, short-term debt securities as cash equivalents. From time to time, including at or near the end of each fiscal quarter, we consider using various temporary investment
strategies for our business. One strategy includes taking proactive steps by utilizing cash equivalents with the objective of enhancing our investment flexibility pursuant to Section 55 of the 1940 Act. More specifically, from time-to-time we
may purchase U.S. Treasury bills or other high-quality, short-term debt securities at or near the end of the quarter and typically close out the position on a net cash basis subsequent to quarter end. We may also utilize repurchase agreements or
other balance sheet transactions, including drawing down on our credit facilities, as deemed appropriate. The amount of these transactions or such drawn cash for this purpose is excluded from total assets for purposes of computing the asset base
upon which the management fee is determined. We held approximately $35 million in cash equivalents as of March 31, 2015.

Debt

Senior Secured Revolving Credit FacilityOn August 26, 2011, the Company established the SUNS SPV which
entered into the Credit Facility with Citigroup Global Markets Inc. acting as administrative agent. The Credit Facility was scheduled to mature on August 26, 2016 and generally bore interest at a rate of LIBOR plus 2.25%. The Credit Facility
can also be expanded up to $600 million and is secured by all of the assets held by the SUNS SPV. Under the terms of the Credit Facility, Solar Senior and the SUNS SPV, as applicable, have made certain customary representations and warranties, and
are required to comply with various covenants, including leverage restrictions, reporting requirements and other customary requirements for similar credit facilities. The Credit Facility also includes usual and customary events of default for credit
facilities of this nature.

On November 7, 2012, we amended our Credit Facility. As a result of the amendment, the stated
interest rate on the Credit Facility was reduced to LIBOR plus 2.00% from LIBOR plus 2.25%, and the Credit Facility continues to have no LIBOR floor requirement. The amendment also provided us greater investment flexibility and extended the final
maturity date to November 6, 2017. On February 26, 2014, the Company utilized the Credit Facilitys delayed draw feature, expanding immediately available capital from $150.0 million to $200.0 million, subject to borrowing base
limitations.

On June 30, 2014, the Company again amended the Credit Facility. As a result of this amendment, commitments
under the Credit Facility were reduced by $25.0 million to $175.0 million and may be expanded up to $600.0 million under its accordion feature. This amendment to the Credit Facility also added greater investment flexibility and extends the final
maturity date to June 28, 2019. The stated interest rate remains LIBOR plus 2.00% with no LIBOR floor requirement. At March 31, 2015, the Company was in compliance with all financial and operational covenants required by the Credit
Facility.

Contractual Obligations



|                                            |  |                                                                  |       |  |                 |   |   |           |  |   |           |  |  |                  |       |  |  |   |   | 
|------------------------------------------- |  | ---------------------------------------------------------------- | ----- |  | --------------- | - | - | --------- |  | - | --------- |  |  | ---------------- | ----- |  |  | - | - | 
|                                            |  | Payments due by Period as of March 31,
2015(dollars in millions) |      
|                                            |  | Total                                                            |       |  | Less than1 year |   |   | 1-3 years |  |   | 3-5 years |  |  | More than5 years |      
|Senior Secured Revolving Credit Facility(1) |  | $                                                                | 140.9 |  |                 | $ |  |           |  | $ |          |  |  | $                | 140.9 |  |  | $ |  | 



|(1) | At March 31, 2015, $34.1 million of capacity remained unused.
|--- | -------------------------------------------------------------



42



---

##### Table of Contents

Information about our senior securities is shown in the following table as of each year
ended December 31 since the Company commenced operations, unless otherwise noted. The  indicates information which the SEC expressly does not require to be disclosed for certain types of senior securities.



|                                     |  |                                                  |         |  |                           |   |        |                                             |  |   |                                |  |  |  |     | 
|------------------------------------ |  | ------------------------------------------------ | ------- |  | ------------------------- | - | ------ | ------------------------------------------- |  | - | ------------------------------ |  |  |  | --- | 
|Class and Year                       |  | Total AmountOutstanding (dollarsin thousands)(1) |         |  | AssetCoveragePer 
Unit(2) |   |        | InvoluntaryLiquidatingPreferencePer Unit(3) |  |   | AverageMarket ValuePer Unit(4) | 
|Revolving Credit Facility            |  |                                                  |         |  |                           |   |        |                                             |  |   |                                |  |  |  |     | 
|Fiscal 2015 (through March 31, 2015) |  | $                                                | 140,900 |  |                           | $ | 2,445  |                                             |  | $ |                               |  |  |  | N/A | 
|Fiscal 2014                          |  |                                                  | 143,200 |  |                           |   | 2,421  |                                             |  |   |                               |  |  |  | N/A | 
|Fiscal 2013                          |  |                                                  | 61,400  |  |                           |   | 4,388  |                                             |  |   |                               |  |  |  | N/A | 
|Fiscal 2012                          |  |                                                  | 39,100  |  |                           |   | 5,453  |                                             |  |   |                               |  |  |  | N/A | 
|Fiscal 2011                          |  |                                                  | 8,600   |  |                           |   | 21,051 |                                             |  |   |                               |  |  |  | N/A | 



|(1) | Total amount of each class of senior securities outstanding at the end of the period presented.
|--- | -----------------------------------------------------------------------------------------------

|(2) | The asset coverage ratio for a class of senior securities representing indebtedness is calculated as our consolidated total assets, less all liabilities and
indebtedness not represented by senior securities, divided by senior securities representing indebtedness. This asset coverage ratio is multiplied by $1,000 to determine the Asset Coverage Per Unit. In order to determine the specific Asset Coverage
Per Unit for each class of debt, the total Asset Coverage Per Unit was divided based on the amount outstanding at the end of the period for each. As of March 31, 2015, asset coverage was 244.5%.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | 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.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

|(4) | Not applicable, we do not have senior securities that are registered for public trading.
|--- | ----------------------------------------------------------------------------------------

We have also entered into two contracts under which we have future commitments: the Investment Advisory and Management Agreement,
pursuant to which Solar Capital Partners, LLC has agreed to serve as our investment adviser, and the Administration Agreement, pursuant to which Solar Capital Management, LLC (the Administrator) has agreed to furnish us with the
facilities and administrative services necessary to conduct our day-to-day operations and provide on our behalf managerial assistance to those portfolio companies to which we are required to provide such assistance. Payments under the Investment
Advisory and Management Agreement are equal to (1) a percentage of the value of our average gross assets and (2) a two-part incentive fee. Payments under the Administration Agreement are equal to an amount based upon our allocable
portion of the Administrators overhead in performing its obligations under the Administration Agreement, including rent, technology systems, insurance and our allocable portion of the costs of our chief financial officer and chief
compliance officer and their respective staffs. Either party may terminate each of the investment advisory and management agreement and administration agreement without penalty upon 60 days written notice to the other. See note 3 to our
Consolidated Financial Statements.

On September 10, 2014, FLLP entered into a servicing agreement with the Company. FLLP
engaged and retained the Company to provide certain administrative services relating to the facilities, supplies and necessary ongoing overhead support services for the operation of FLLPs ongoing business affairs in exchange for a fee. Either
party may terminate this agreement upon 30 days written notice to the other.



43



---

##### Table of Contents

Off-Balance Sheet Arrangements

The Company had unfunded debt and equity commitments to various revolving and delayed draw loans, as well as to Gemino. The total amount
of these unfunded commitments as of March 31, 2015 and December 31, 2014 is $6.7 million and $6.7 million, respectively, comprised of the following:



|                                      |  |               |     |  |                  |   |     | 
|------------------------------------- |  | ------------- | --- |  | ---------------- | - | --- | 
|                                      |  | March 31,2015 |     |  | December 31,2014 |  
|(in millions)                         |  |               |     |  |                  |   |     | 
|Gemino Healthcare Finance, LLC*       |  | $             | 5.0 |  |                  | $ | 5.0 | 
|Engineering Solutions & Products, LLC |  |               | 1.7 |  |                  |   | 1.7 | 
|                                      |  |               |     |  |                  |   |     | 
|Total Commitments                     |  | $             | 6.7 |  |                  | $ | 6.7 | 
|                                      |  |               |     |  |                  |   |     | 



|* | The Company controls the funding of this commitment and may cancel it at its discretion.
|- | ----------------------------------------------------------------------------------------

As of March 31, 2015 and December 31, 2014, the Company had sufficient cash available and/or liquid securities available to
fund these commitments.

In the normal course of its business, we invest or trade in various financial instruments and may
enter into various investment activities with off-balance sheet risk, which may include forward foreign currency contracts. Generally, these financial instruments represent future commitments to purchase or sell other financial instruments at
specific terms at future dates. These financial instruments contain varying degrees of off-balance sheet risk whereby changes in the market value or our satisfaction of the obligations may exceed the amount recognized in our consolidated Statement
of Assets and Liabilities.



44



---

##### Table of Contents

Distributions

The following table reflects the cash distributions per share on our common stock for the two most recent fiscal years and the current fiscal year to date:



|                  |  |                    |  |                   |  |        |        | 
|----------------- |  | ------------------ |  | ----------------- |  | ------ | ------ | 
|Date Declared     |  | Record Date        |  | Payment Date      |  | Amount |       
|Fiscal 2015       |  |                    |  |                   |  |        |        | 
|May 5, 2015       |  | May 21, 2015       |  | June 2, 2015      |  | $      | 0.1175 | 
|April 9, 2015     |  | April 23, 2015     |  | May 1, 2015       |  |        | 0.1175 | 
|February 25, 2015 |  | March 19, 2015     |  | April 2, 2015     |  |        | 0.1175 | 
|February 3, 2015  |  | February 19, 2015  |  | February 27, 2015 |  |        | 0.1175 | 
|January 8, 2015   |  | January 22, 2015   |  | January 30, 2015  |  |        | 0.1175 | 
|                  |  |                    |  |                   |  |        |        | 
|YTD Total (2015)  |  |                    |  |                   |  | $      | 0.5875 | 
|                  |  |                    |  |                   |  |        |        | 
|Fiscal 2014       |  |                    |  |                   |  |        |        | 
|December 4, 2014  |  | December 18, 2014  |  | January 5, 2015   |  | $      | 0.1175 | 
|November 4, 2014  |  | November 20, 2014  |  | December 2, 2014  |  |        | 0.1175 | 
|October 8, 2014   |  | October 23, 2014   |  | October 31, 2014  |  |        | 0.1175 | 
|September 9, 2014 |  | September 25, 2014 |  | October 2, 2014   |  |        | 0.1175 | 
|August 4, 2014    |  | August 21, 2014    |  | September 3, 2014 |  |        | 0.1175 | 
|July 9, 2014      |  | July 24, 2014      |  | August 1, 2014    |  |        | 0.1175 | 
|June 6, 2014      |  | June 19, 2014      |  | July 1, 2014      |  |        | 0.1175 | 
|May 5, 2014       |  | May 22, 2014       |  | May 30, 2014      |  |        | 0.1175 | 
|April 8, 2014     |  | April 24, 2014     |  | May 1, 2014       |  |        | 0.1175 | 
|February 25, 2014 |  | March 20, 2014     |  | April 1, 2014     |  |        | 0.1175 | 
|February 6, 2014  |  | February 20, 2014  |  | February 28, 2014 |  |        | 0.1175 | 
|January 9, 2014   |  | January 23, 2014   |  | January 31, 2014  |  |        | 0.1175 | 
|                  |  |                    |  |                   |  |        |        | 
|Total (2014)      |  |                    |  |                   |  | $      | 1.41   | 
|                  |  |                    |  |                   |  |        |        | 
|Fiscal 2013       |  |                    |  |                   |  |        |        | 
|December 5, 2013  |  | December 19, 2013  |  | January 3, 2014   |  | $      | 0.1175 | 
|October 30, 2013  |  | November 21, 2013  |  | December 3, 2013  |  |        | 0.1175 | 
|October 8, 2013   |  | October 24, 2013   |  | November 1, 2013  |  |        | 0.1175 | 
|September 5, 2013 |  | September 19, 2013 |  | October 2, 2013   |  |        | 0.1175 | 
|July 31, 2013     |  | August 22, 2013    |  | September 4, 2013 |  |        | 0.1175 | 
|July 9, 2013      |  | July 25, 2013      |  | August 1, 2013    |  |        | 0.1175 | 
|June 5, 2013      |  | June 20, 2013      |  | July 2, 2013      |  |        | 0.1175 | 
|May 7, 2013       |  | May 23, 2013       |  | June 3, 2013      |  |        | 0.1175 | 
|April 8, 2013     |  | April 25, 2013     |  | May 1, 2013       |  |        | 0.1175 | 
|February 25, 2013 |  | March 21, 2013     |  | April 2, 2013     |  |        | 0.1175 | 
|February 5, 2013  |  | February 21, 2013  |  | March 1, 2013     |  |        | 0.1175 | 
|January 8, 2013   |  | January 24, 2013   |  | February 1, 2013  |  |        | 0.1175 | 
|                  |  |                    |  |                   |  |        |        | 
|Total (2013)      |  |                    |  |                   |  | $      | 1.41   | 
|                  |  |                    |  |                   |  |        |        | 

Tax characteristics of all distributions will be reported to shareholders on Form 1099 after the end of
the calendar year. Future distributions, if any, will be determined by our Board. We expect that our distributions to stockholders will generally be from accumulated net investment income, from net realized capital gains or non-taxable return of
capital, if any, as applicable.

We have elected to be taxed as a RIC under Subchapter M of the Code. To maintain our RIC
status, we must distribute at least 90% of our ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, if any, out of the assets legally available for distribution. In addition, although we
currently intend to distribute realized net capital gains (i.e., net long-term capital gains in excess of short-term capital losses), if any, at least annually, out of the assets legally available for such distributions, we may in the future
decide to retain such capital gains for investment.

We maintain an opt out dividend reinvestment plan for our
common stockholders. As a result, if we declare a distribution, then stockholders cash distributions will be automatically reinvested in additional shares of our common stock, unless they specifically opt out of the dividend
reinvestment plan so as to receive cash distributions.



45



---

##### Table of Contents

We may not be able to achieve operating results that will allow us to make distributions at
a specific level or to increase the amount of these distributions from time to time. In addition, due to the asset coverage test applicable to us as a business development company, we may in the future be limited in our ability to make
distributions. Also, our revolving credit facility may limit our ability to declare distributions if we default under certain provisions. If we do not distribute a certain percentage of our income annually, we will suffer adverse tax consequences,
including possible loss of the tax benefits available to us as a regulated investment company. In addition, in accordance with GAAP and tax regulations, we include in income certain amounts that we have not yet received in cash, such as contractual
payment-in-kind interest, which represents contractual interest added to the loan balance that becomes due at the end of the loan term, or the accrual of original issue or market discount. Since we may recognize income before or without receiving
cash representing such income, we may have difficulty meeting the requirement to distribute at least 90% of our investment company taxable income to obtain tax benefits as a regulated investment company.

With respect to the distributions to stockholders, income from origination, structuring, closing and certain other upfront fees
associated with investments in portfolio companies are treated as taxable income and accordingly, distributed to stockholders.

Related
Parties

We have entered into a number of business relationships with affiliated or related parties, including the
following:



| |  |  | We have entered into an Investment Advisory and Management Agreement with the Investment Adviser. Mr. Gross, our chairman and chief executive
officer, is a managing member and a senior investment professional of, and has financial and controlling interests in, the Investment Adviser. In addition, Mr. Spohler, our chief operating officer is a partner and a senior investment
professional of, and has financial interests in, the Investment Adviser.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | The Administrator provides us with the office facilities and administrative services necessary to conduct day-to-day operations pursuant to our
Administration Agreement. We reimburse the Administrator for the allocable portion of overhead and other expenses incurred by it in performing its obligations under the Administration Agreement, including rent, the fees and expenses associated with
performing compliance functions, and the compensation of our chief compliance officer, our chief financial officer and any administrative support staff.
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | We have entered into a license agreement with the Investment Adviser, pursuant to which the Investment Adviser has granted us a non-exclusive,
royalty-free license to use the name Solar Capital.
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

The Investment Adviser and its affiliates
may also manage other funds in the future that may have investment mandates that are similar, in whole and in part, with ours. For example, the Investment Adviser presently serves as investment adviser to Solar Capital Ltd., a publicly traded BDC,
which to focuses on investing primarily in senior secured loans, mezzanine loans and equity securities. In addition, Michael S. Gross, our chairman and chief executive officer, Bruce Spohler, our chief operating officer, and Richard L. Peteka, our
chief financial officer, serve in similar capacities for Solar Capital Ltd. The Investment Adviser and certain investment advisory affiliates may determine that an investment is appropriate for us and for one or more of those other funds. In such
event, depending on the availability of such investment and other appropriate factors, the Investment Adviser or its affiliates may determine that we should invest side-by-side with one or more other funds. Any such investments will be made only to
the extent permitted by applicable law and interpretive positions of the SEC and its staff, and consistent with the Investment Advisers allocation procedures.

In addition, we have adopted a formal code of ethics that governs the conduct of our officers and directors. Our officers and directors also remain subject to the duties imposed by both the 1940 Act and
the Maryland General Corporation Law.



46



---

##### Table of Contents

|Item 3. | Quantitative and Qualitative Disclosures About Market Risk
|------- | ----------------------------------------------------------

We are subject to financial market risks, including changes in interest rates. During the three months ended March 31, 2015, all but two of the investments had floating interest rates. Our loans are
primarily based on floating LIBOR and typically have durations of one to three months after which they reset to current market interest rates. Most of our loans to portfolio companies have LIBOR floors. The Company also has a revolving credit
facility that is based on floating LIBOR and commercial paper rates. Assuming no changes to our balance sheet as of March 31, 2015, a hypothetical one-quarter of one percent decrease in LIBOR on our floating rate assets and liabilities would
increase our earnings by approximately two cents per average share over the next twelve months. Assuming no changes to our balance sheet as of March 31, 2015, a hypothetical one percent increase in LIBOR on our floating rate assets and
liabilities would decrease our earnings by approximately six cents per average share over the next twelve months. However, we may hedge against interest rate fluctuations from time-to-time by using standard hedging instruments such as futures,
options and forward contracts subject to the requirements of the 1940 Act. While hedging activities may insulate us against adverse changes in interest rates, they may also limit our ability to participate in any benefits of certain changes in
interest rates with respect to our portfolio of investments.



|                                                                |  |         |  |        
|--------------------------------------------------------------- |  | ------- |  | -------
|Increase (Decrease) in LIBOR                                    |  | (0.25%) |  | 1.00%  
|Increase (Decrease) in Net Investment Income Per Share Per
Year |  | $0.02   |  | $(0.06)



|Item 4. | Controls and Procedures
|------- | -----------------------

(a)
Evaluation of Disclosure Controls and Procedures

As of March 31, 2015 (the end of the period covered by this
report), we, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) of the 1934 Act). Based on that
evaluation, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective and provided reasonable assurance that information required to be disclosed in our
periodic SEC filings is recorded, processed, summarized and reported within the time periods specified in the SECs rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive
Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. However, in evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well
designed and operated can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of such possible controls and
procedures.

(b) Changes in Internal Controls Over Financial Reporting

Management has not identified any change in the Companys internal control over financial reporting that occurred during the first
quarter of 2015 that has materially affected, or is reasonably likely to materially affect, the Companys internal control over financial reporting.



47



---

##### Table of Contents

PART II. OTHER INFORMATION



|Item 1. | Legal Proceedings
|------- | -----------------

We,
Solar Capital Management, LLC and Solar Capital Partners, LLC are not currently subject to any material pending legal proceedings threatened against us. From time to time, we may be a party to certain legal proceedings incidental to the normal
course of our business including the enforcement of our rights under contracts with our portfolio companies. While the outcome of these legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a
material effect upon our business, financial condition or results of operations beyond what has been disclosed with these financial statements.



|Item 1A. | Risk Factors
|-------- | ------------

In addition
to the other information set forth in this report, you should carefully consider the factors discussed in Risk Factors in the March 5, 2015 filing of our Registration Statement on Form N-2, which could materially affect our
business, financial condition and/or operating results. The risks described in our Registration Statement on Form N-2 are not the only risks facing our company. Additional risks and uncertainties not currently known to us or that we currently deem
to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.



|Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds
|------- | -----------------------------------------------------------

We did not engage in unregistered sales of securities during the quarter ended March 31, 2015.



|Item 3. | Defaults Upon Senior Securities
|------- | -------------------------------

None.



|Item 4. | Mine Safety Disclosures
|------- | -----------------------

Not applicable.



|Item 5. | Other Information
|------- | -----------------

None.



48



---

##### Table of Contents

|Item 6. | Exhibits
|------- | --------

The following
exhibits are filed as part of this report or hereby incorporated by reference to exhibits previously filed with the SEC:



|               |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|-------------- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit
Number |  | Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|               | 
|3.1            |  | Articles of Amendment and Restatement(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|               | 
|3.2            |  | Amended and Restated Bylaws(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|               | 
|4.1            |  | Form of Common Stock Certificate(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|               | 
|10.1           |  | Dividend Reinvestment Plan(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|               | 
|10.2           |  | Investment Advisory and Management Agreement by and between Registrant and Solar Capital Partners, LLC(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|               | 
|10.3           |  | Form of Custody Agreement(4)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|               | 
|10.4           |  | Administration Agreement by and between Registrant and Solar Capital Management, LLC(4)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|               | 
|10.5           |  | Form of Indemnification Agreement by and between Registrant and each of its directors(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|               | 
|10.6           |  | Trademark License Agreement by and between Registrant and Solar Capital Partners, LLC(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|               | 
|10.7           |  | Form of Share Purchase Agreement by and between Registrant and Solar Senior Capital Investors, LLC(1)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|               | 
|10.8           |  | Amendment No. 1 to Share Purchase Agreement by and between Registrant and Solar Senior Capital Investors, LLC(2)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|               | 
|10.9           |  | Form of Contribution Agreement, dated as of August 26, 2011, by and between SUNS SPV LLC, as the contributee, and Solar Senior Capital Ltd., as the contributor(3)                                                                                                                                                                                                                                                                                                                                                                                                                                           
|               | 
|10.10          |  | Third Amendment to the Loan and Servicing Agreement, dated as of June 30, 2014 by and among the Registrant, as the transferor and the servicer, SUNS SPV LLC, as the borrower,
Citibank, N.A., as the administrative agent and collateral agent, each of the conduit lenders from time to time party thereto, each of the lender agents from time to time party thereto, each of the liquidity banks from time to time party thereto,
each of the institutional lenders from time to time party thereto, and Wells Fargo Bank, N.A., as the account bank, the collateral custodian and the backup servicer(5)
|               | 
|10.11          |  | Form of Loan and Servicing Agreement, dated as of August 26, 2011 (as amended through June 30, 2014), by and among the Registrant, as the servicer and the transferor, SUNS SPV LLC,
as the borrower, each of the conduit lenders from time to time party thereto, each of the liquidity banks from time to time party thereto, each of the lender agents from time to time party thereto, Citibank, N.A., as the administrative agent and
collateral agent, and Wells Fargo Bank, N.A., as the account bank, the backup servicer and the collateral
custodian(5)                                            
|               | 
|10.12          |  | Form of Limited Liability Company Agreement, dated as of September 10, 2014, by and among the Registrant, Voya Retirement Insurance and Annuity Company, ReliaStar Life Insurance
Company, and Voya Insurance and Annuity Company, by and through Voya Investment Management LLC, as agent and investment manager(6)                                                                                                                                                                                                                                                                                         
|               | 
|11.1           |  | Computation of Per Share Earnings (included in the notes to the financial statements contained in this report).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|               | 
|31.1           |  | Certification of Chief Executive Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as
amended.*                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        



49



---

##### Table of Contents

|               |  |                                                                                                                      
|-------------- |  | ---------------------------------------------------------------------------------------------------------------------
|Exhibit
Number |  | Description                                                                                                          
|               | 
|31.2           |  | Certification of Chief Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.*
|               | 
|32.1           |  | Certification of Chief Executive Officer pursuant to Section 906 of The Sarbanes-Oxley Act of 2002.*                 
|               | 
|32.2           |  | Certification of Chief Financial Officer pursuant to Section 906 of The Sarbanes-Oxley Act of 2002.*                 



|(1) | Previously filed in connection with Solar Senior Capital Ltd.s registration statement on Form N-2 (File No. 333-171330) filed on February 14, 2011.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | Previously filed in connection with Solar Senior Capital Ltd.s report on Form 10-K filed on February 22, 2012.
|--- | ---------------------------------------------------------------------------------------------------------------

|(3) | Previously filed in connection with Solar Senior Capital Ltd.s report on Form 8-K filed on August 31, 2011.
|--- | ------------------------------------------------------------------------------------------------------------

|(4) | Previously filed in connection with Solar Senior Capital Ltd.s report on Form 10-K filed on February 25, 2014.
|--- | ---------------------------------------------------------------------------------------------------------------

|(5) | Previously filed in connection with Solar Senior Capital Ltd.s report on Form 10-Q filed on August 4, 2014.
|--- | ------------------------------------------------------------------------------------------------------------

|(6) | Previously filed in connection with Solar Senior Capital Ltd.s report on Form 10-Q filed on November 4, 2014.
|--- | --------------------------------------------------------------------------------------------------------------

|* | Filed herewith.
|- | ---------------



50



---

##### Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized on May 5, 2015.



|                          |  |                                                                                       
|------------------------- |  | --------------------------------------------------------------------------------------
|SOLAR SENIOR CAPITAL LTD.
|                          | 
|By:                       |  | /S/    MICHAEL S.
GROSS                                                               
|                          |  | Michael S. Gross Chief Executive Officer (Principal Executive
Officer)                
|                          | 
|By:                       |  | /S/    RICHARD L.
PETEKA                                                              
|                          |  | Richard L. Peteka Chief Financial Officer (Principal Financial and Accounting
Officer)



51